AR 2013 Title Letter size copy - Claris Lifesciences Limited Report 2013... · Management Discussion & Analysis 24 Standalone Financial ... Punjab National Bank ... 2013 and Statement

ContentManaging Director & CEO’s Message 03

Notice to Shareholders 05

Directors’ Report 12

Report on Corporate Governance 16

Management Discussion & Analysis 24

Standalone Financial Statements

Auditors’ Report 37

Annexure to Auditors’ Report 38

Balance Sheet 40

Statement of Profit & Loss 41

Cash Flow Statement 42

Notes forming part of the Financial Statements 44

Consolidated Financial Statements

Auditors’ Report 65

Consolidated Balance Sheet 66

Consolidated Statement of Profit & Loss 67

Consolidated Cash Flow Statement 68

Notes forming part of the Financial Statements 70

Information on the Financials of the Subsidiary Companies 87

Proxy Form 95

Corporate Information

BOARD OF DIRECTORS REGISTERED & CORPORATE OFFICEClaris Corporate Headquarters, Nr. Parimal Railway Crossing, Mr. Surrinder Lal KapurEllisbridge, Ahmedabad - 380006, IndiaChairman & Independent DirectorTel: +91-79-26563331 Fax:- +91-79-26408053/26565879Mr. Arjun HandaWebsite: www.clarislifesciences.comManaging Director & CEO

Mr. Aditya S. HandaMANUFACTURING FACILITYDirectorVillage: Chacharwadi, VasnaTaluka: SanandMr. Chetan S. MajmudarAhmedabad - 382213, IndiaWhole Time Director

BANKERS Mr. Chandrasingh S. Purohit1. Canara BankWhole Time Director2. Indian Overseas Bank3. Punjab National BankMr. T. V. Ananthanarayanan4. Andhra BankIndependent Director5. Allahabad Bank6. Central Bank of IndiaMr. Anup P. Shah7. Vijaya BankIndependent Director8. Barclays Bank Plc

VP-Company Secretary & Compliance OfficerREGISTRAR AND SHARE TRANSFER AGENTSKirit KanjariaLINK INTIME INDIA PRIVATE LIMITED(Unit : Claris Lifesciences Limited)AUDITORSC-13, Pannalal Silk Mills CompoundDeloitte Haskins & Sells, AhmedabadLBS Road, Bhandup (West)Mumbai – 400 078

CIN: L85110GJ1994PLC022543

The year witnessed the outcome of our persistent efforts in regulated markets including the USA, where we have 12 ANDAs approval on hand, and 23 ANDAs in approval pipeline. In Europe, we have already crossed the mark of 213 product approvals with 69 products under approvals.

Our income from net sales in the year 2013 stood at Rs. 65,838 lacs where revenues from international markets stood at Rs. 43,827 lacs, representing 67% of the net revenues.

We set up a new injectables plant which will be operational by mid next year. This will add to our capacity to cater to increasing demands of our high-end, complex products.

We paid serious attention to people development, corporate governance, and a paradigm of corporate social responsibility that includes contributing to society at large through various initiatives creating meaningful and sustained impact to the cause we espouse.

Dear Shareowners, Our people practices were once again recognised by industry experts which made us achieve the ‘Best Place to Work’ award

I am happy to share with you the Annual Report for the year and retain 1st position in Healthcare sector for the consecutive 2013. fourth time. This recognition once again is a confirmation of our

belief that people are everything.The year 2013 will always be remembered as strategically one of the most significant years for Claris. We remained focused on I thank all the stakeholders for continued trust and support strengthening our base competency i.e. Injectables. We adopted extended to Claris.two-pronged strategy for growth – (a) Enhanced focus on regulated markets by aggressively filing ANDAs in the USA, enhancing network and product portfolio in Europe and other regulated markets; and (b) Separated out our successful Arjun Handainfusion (IV fluids) business in emerging markets, by forming Managing Director & CEOnew joint venture company, Claris Otsuka Ltd. (Claris Otsuka) with Japanese partners, Otsuka Pharmaceutical Factory Inc (Otsuka), and Mitsui & Co. Ltd. (Mitsui).

I believe this new JV Company that became functional in August 2013 has brought complementary strengths to the table and will help foster the business, benefiting all stakeholders at large. With this JV in place, Claris team can dedicatedly focus their efforts on injectables business in regulated markets. Moreover, the growth from Claris Otsuka will have more to offer in building Claris further.

We have ushered into a new growth trajectory, and we are committed to take the Injectables business to newer heights, by expanding manufacturing capacities, building larger product portfolio, capturing larger markets and investing in new ways of working.

Managing Director & CEO’s Message

Arjun Handa | MD & CEO

Notice to ShareholdersCLARIS LIFESCEINCES LIMITEDRegd. Office: Claris Corporate Headquarters,Near Parimal Railway Crossing, Ellisbridge,Ahmedabad – 380 006, IndiaTel. No. +91-79-2656 3331Fax: +91-79-2640 8053/ 2656 5879Website: CIN: L85110GJ1994PLC022543

NOTICE TO SHAREHOLDERS

Notice is hereby given that the Nineteenth Annual General Meeting of the Members of CLARIS LIFESCIENCES LIMITED will be held on Tuesday, June 17, 2014 at 11.00 AM at Ahmedabad Management Association, J.B. Auditorium, ATIRA Campus, Dr. Vikram Sarabhai Marg, Ahmedabad – 380015 to transact the following business:

ORDINARY BUSINESS:

1. To receive, consider and adopt the Audited Balance Sheet as at December 31, 2013 and Statement of Profit & Loss for the financial year ended on that date together with the Report of the Board of Directors and Auditors thereon.

2. To appoint a Director in place of Mr. Aditya S Handa, who retires by rotation and being eligible, offers himself for re-appointment.

3. To appoint M/s Shah and Shah Associates, Chartered Accountants, Ahmedabad (FRN 113742W) as the new Statutory Auditors of the company to hold office from the conclusion of this Annual General Meeting until the conclusion of next Annual General Meeting of the Company in place of the retiring Auditors, namely, M/s. Deloitte Haskins & Sells, Chartered Accountants, and to fix the remuneration of the new Auditors:

“RESOLVED THAT pursuant to the provisions of Sections 139,140,141 and other applicable provisions, if any of the Companies Act, 2013, approval be and is hereby accorded to appoint M/s Shah and Shah Associates, Chartered Accountants, Ahmedabad (FRN 113742W) as Statutory Auditors of the Company, to hold office from the conclusion of this Annual General Meeting up to the conclusion of the next Annual General Meeting, in place of the retiring Auditors, M/s. Deloitte Haskins & Sells, Chartered Accountants Ahmedabad (FRN 117365W), Statutory Auditors of the Company.”

“RESOLVED FURTHER THAT the Board of Directors be and are hereby authorized to fix the remuneration and other terms and conditions of said appointment.”

“RESOLVED FURTHER THAT any one Director or the Company Secretary of the Company be and are hereby severally authorized to file necessary of e-forms with Registrar of Companies, Gujarat.”

SPECIAL BUSINESS:

4. To consider and if thought fit, to pass with or without modification(s) the following resolution as a Special Resolution:

"RESOLVED THAT in supersession of the earlier resolution passed at the 17th Annual General Meeting held on April 30, 2012 and pursuant to Section 180(1)(c) and all other applicable provisions, if any, of the Companies Act, 2013 (previously being Section 293(1)(d) of the Companies Act, 1956),including any statutory modifications or re-enactments thereof, the consent of the members be and is hereby accorded to the Board of Directors to borrow any sum or sums of money from time to time from any one or more Banks and/or from any one or more persons, firms, Bodies Corporate or Financial Institutions, Multilateral agencies, Foreign Institutional Investors, Foreign Financial Institutions and from any other persons or combination thereof whether by way of over draft, cash credit, guarantees, advance or deposits, loans, bills discounting or otherwise and whether unsecured or secured by mortgage, charge, hypothecation, lien or pledge of the Company's assets and properties, whether in full or in part, whether immovable, movable or stock in trade (including raw materials, stores, spare parts and components, in stock or in transit) current assets and work in process and all or any of the undertaking(s) of the Company, notwithstanding that the monies to be borrowed together with monies already borrowed by the Company (apart from temporary loans obtained from the Company's Bankers in the ordinary course of business) will or may exceed at any time the aggregate of the paid-up share capital of the Company and its free reserves, that is to say, reserves not set apart for any specific purpose so that the total amounts of monies so borrowed at any time shall not exceed the sum of Rs 750 Crores (Rupees Seven Hundred Fifty Crores Only).”

“RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorised to do all such acts, deeds, matters and things that may be necessary, desirable or expedient for giving effect to the above resolution.”


"RESOLVED THAT Mr. Surrinder Lal Kapur, already an Independent Director pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges and who is eligible to remain in office as an Independent Director pursuant to Section 149 and all other applicable provisions, if any, of the Companies Act, 2013 and Rules made thereunder (including any statutory modification(s) or re-enactment thereof) read with Schedule IV of the Companies Act, 2013 and the revised Clause 49 of the Listing Agreement effective from 1st October, 2014, continue as an Independent Director for a term of 5 (five) consecutive years with effect from April 1, 2014 up to March 31, 2019 , and shall not be liable to retire by rotation.”

www.clarislifesciences.com

Claris Lifesciences Limited - Annual Report 2013 5

Notice to Shareholders

Claris Lifesciences Limited - Annual Report 20136

Place : AhmedabadDate : May 9, 2014

Registered Office : Claris Corporate Headquarters,Nr. Parimal Railway Crossing, Ellisbridge, Ahmedabad 380006, IndiaTel. No. +91-79-2656 3331Fax: +91-79-2640 8053/ 2656 5879Website: CIN: L85110GJ1994PLC022543


By order of the Board of DirectorsFor Claris Lifesciences Limited

Kirit KanjariaVP – Company Secretary & Compliance Officer


"RESOLVED THAT Mr. T. V. Ananthanarayanan, already an Independent Director pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges and who is eligible to remain in office as an Independent Director pursuant to Section 149 and all other applicable provisions, if any, of the Companies Act, 2013 and Rules made thereunder (including any statutory modification(s) or re-enactment thereof) read with Schedule IV of the Companies Act, 2013 and the revised Clause 49 of the Listing Agreement effective from 1st October, 2014, continue as an Independent Director for a term of 5 (five) consecutive years with effect from April 1, 2014 up to March 31, 2019 , and shall not be liable to retire by rotation.”


"RESOLVED THAT Mr. Anup P. Shah, already an Independent Director pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges and who is eligible to remain in office as an Independent Director pursuant to Section 149 and all other applicable provisions, if any, of the Companies Act, 2013 and Rules made thereunder (including any statutory modification(s) or re-enactment thereof) read with Schedule IV of the Companies Act, 2013 and the revised Clause 49 of the Listing Agreement effective from 1st October, 2014, continue as an Independent Director for a term of 5 (five) consecutive years with effect from April 1, 2014 up to March 31, 2019 , and shall not be liable to retire by rotation.”


“RESOLVED THAT subject to the provisions of Sections 196, 197, 198, 203 and other applicable provisions, if any, of the Companies Act, 2013 read with Schedule V thereto and further read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, Mr. Chetan S. Majmudar, be and is hereby re-appointed as a Whole Time Director of the Company, for a further period of 3 years commencing from 1st July, 2014 to 30th June, 2017 upon the terms and conditions, including the remuneration to be paid as may be agreed to and decided by the Board and Mr. Chetan S. Majmudar.”

“RESOLVED FURTHER THAT subject to the provisions of Section 197 and other applicable provisions, if any, of the Companies Act, 2013, the remuneration as set out herein above be paid as minimum remuneration to Mr. Chetan S. Majmudar, notwithstanding that in any financial year of the Company during his tenure as Whole Time Director, the Company has made no profits or profits are inadequate.”

“RESOLVED FURTHER THAT subject to the superintendence, control and direction of the Board of Directors of the Company and the regulations contained in the Memorandum and Articles of Association of the Company and also the provisions of the Companies Act, 2013 and any other regulations that may be applicable to the operations of the Company, Mr. Chetan S Majmudar as a Whole Time Director, be made responsible for and be authorised to take decisions as mentioned in the Letter of his re-appointment.”

“RESOLVED FURTHER THAT pursuant to the provisions of Rules 3 and 8 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a return of appointment in the prescribed form be filed with the Registrar of Companies within the prescribed time period for the appointment of Mr. Chetan S. Majmudar as the Whole Time Director of the Company. ”

NOTES:1. Explanatory Statement as required under Section 102 of the Companies Act, 2013 in respect of the Special Business is annexed hereto.

2. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE ANNUAL GENERAL MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE IN THE MEETING INSTEAD OF HIMSELF/HERSELF AND THE PROXY NEED NOT BE A MEMBER OF THE COMPANY. THE INSTRUMENT APPOINTING THE PROXY IN ORDER TO BE EFFECTIVE, MUST BE DEPOSITED AT THE REGISTERED OFFICE OF THE COMPANY NOT LESS THAN 48 HOURS BEFORE THE COMMENCEMENT OF THE MEETING. MEMBERS/ PROXIES SHOULD BRING THEIR DULY FILLED ATTENDANCE SLIP ATTACHED HEREWITH TO ATTEND THE MEETING. A proxy form is sent herewith. Proxies submitted on behalf of the companies, societies, etc., must be supported by an appropriate resolution/ authority, as applicable. A person can act as proxy on behalf of members not exceeding 50 (fifty) and holding in aggregate not more than 10 (ten) percent of the total share capital of the Company.

3. Members are requested to kindly bring their copy of the Annual Report with them at the Annual General Meeting, as no extra copy of Annual Report would be made available at the Annual General Meeting.



4. The Register of Members and Share Transfer Books will remain closed from June 13, 2014 to June 17, 2014 (both days inclusive).

5. The brief profile of the Directors proposed to be re-appointed is given in the section “Report on Corporate Governance” of the Annual Report.

6. All documents referred to in the Notice or in the accompanying Explanatory Statement are available for inspection by the members at the Registered Office of the Company on all working days, except Saturdays, Sundays and public holidays, between 10.00 a.m. to 1.00 p.m. prior to the date of the Annual General Meeting and also available for inspection at the meeting.

7. The shares of the Company are at present listed with BSE Limited. The listing fee for the year 2014-2015 is paid to BSE before the due date.

8. Pursuant to Section 72 of the Companies Act, 2013 read with the Companies (Share Capital and Debentures) Rules, 2014, members are entitled to make a nomination in respect of shares held by them in physical form. Shareholders desirous of making a nomination are requested to send their requests in Form No. SH-13 in duplicate (which will be made available on request) to the Registrar and Share Transfer Agent of the Company.

9. The Notice along with Annual Report will be sent electronically indicating the process and manner of E-Voting to the members whose e-mail addresses are registered with the depository participants /Company. The physical copy of Notice along with Annual Report has been sent to those members whose email addresses are not registered with the depository participants /Company indicating the process and manner of E-Voting.

The members will be entitled to receive physical copy of annual report for the financial year ended December 31, 2013, free of cost, upon sending a request to the Registrar and Transfer Agent or the Company Secretary of the Company. The Notice along with Annual Report will also be available on the Company's website www.clarislifesciences.com

10. In terms of the Circular No. CIR/MRD/DP/10/2013 dated March 21, 2013 issued by the Securities and Exchange Board of India, listed companies are required to use the Reserve Bank of India's approved electronic mode of payment such as Electronic Clearance Service (ECS), LECS (Local ECS)/RECS (Regional ECS)/NECS (National ECS), NEFT, etc. for making cash payments like dividend, etc. to the members.

Accordingly, members holding securities in demat mode are requested to update their bank details with their depository participants. And the members holding securities in physical form are requested to send a request to the Registrar and Transfer Agent i.e. Link Intime India Private Limited or the Company Secretary of the Company.

11. Members are requested to inform change in address or bank mandate to their respective depository participants with whom they are maintaining their demat accounts and with the Registrar and Transfer Agent i.e. M/s Link Intime India Private Limited or the Company Secretary of the Company for the shares held in physical form by a written request duly signed by the member for receiving all communication in future.

12.Members desiring any information relating to the accounts are requested to write to the Company at least 10 days before the meeting so as to enable the management to keep the information available at the meeting.

13.Members wishing to claim dividend, which remain unclaimed, are requested to correspond with the Registrar and Transfer Agent i.e. M/s Link Intime India Private Limited or the Company Secretary of the Company. Members are requested to note that dividends not claimed within a period of seven years from the date of transfer to the Company's Unpaid Dividend Account, will be as per the Section 124 of the Companies Act, 2013, be transferred to Investor Education and Protection Fund.

Members who have either neither received nor encashed their dividend warrant(s) for the financial years ended December 31, 2010 upto December 31, 2013, are requested to write to the Company, mentioning the relevant Folio number or DP ID and Client ID, for issuance of duplicate/revalidated dividend warrant(s).

14. Voting through electronic means:-

I In compliance with the provisions of Section 107 and 108 of the Companies Act, 2013 read with Rule 20 of the Companies (Management and Administration) Rules, 2014 and in further pursuance to the revised Clause 35B of the Listing Agreement effective with immediate effect from vide Circular No. CFD/ Policy Cell/ 2/ 2014 dated 17th April, 2014 issued by the Securities and Exchange Board of India, the Company is pleased to provide members facility to exercise their right to vote at the 19th Annual General Meeting by electronic means and business may be transacted through E-Voting services provided by National Securities Depository Limited (NSDL). It is hereby clarified that it is not mandatory for a member to vote using the E-voting facility and a member may avail of the facility at his/her discretions, subject to compliance with the instruction for E-Voting given below.

In case of Members who are entitled to vote but have not exercised their right to vote by electronic means, the Chairman of the Company may order a poll on his own motion in terms of Section 109 of the Companies Act, 2013 for the businesses specified in the accompanying Notice. For abundant clarity, in the event of poll, please note that the Members who have exercised their right to vote by electronic means shall not vote by way of poll at the Meeting.

A. In case a Member receives an email from NSDL [for members whose email IDs are registered with the Company/Depository Participants(s)]:(i) Open email and open PDF file viz; “Claris Annual Report e-Voting.pdf” with your Client ID or Folio No. as password. The said PDF file contains your

user ID and password/PIN for e-voting. Please note that the password is an initial password.(ii) Launch internet browser by typing the following URL: https://www.evoting.nsdl.com/(iii) Click on Shareholder - Login(iv) Put user ID and password as initial password/PIN noted in step (i) above. Click Login.(v) Password change menu appears. Change the password/PIN with new password of your choice with minimum 8 digits/characters or combination



thereof. Note new password. It is strongly recommended not to share your password with any other person and take utmost care to keep your password confidential.

(vi) Home page of e-voting opens. Click on e-Voting: Active Voting Cycles.(vii) Select “EVEN” of Claris Lifesciences Limited.

(viii) Now you are ready for e-voting as Cast Vote page opens.(ix) Cast your vote by selecting appropriate option and click on “Submit” and also “Confirm” when prompted.(x) Upon confirmation, the message “Vote cast successfully” will be displayed(xi) Once you have voted on the resolution, you will not be allowed to modify your vote(xii) Institutional shareholders (i.e. other than individuals, HUF, NRI etc.) are required to send scanned copy (PDF/JPG Format) of the relevant Board

Resolution/ Authority letter etc. together with attested specimen signature of the duly authorized signatory(ies) who are authorized to vote, to the Scrutinizer through e-mail to [email protected] with a copy marked to [email protected]

B. In case a Member receives physical copy of the Notice of Annual General Meeting [for members whose email IDs are not registered with the Company/Depository Participants(s) or requesting physical copy] :

(i) Initial password is provided as below/at the bottom of the Attendance Slip for the Annual General Meeting:

EVEN (E Voting Event Number) USER ID PASSWORD/PIN

(ii) Please follow all steps from Sl. No. (ii) to Sl. No. (xii) above, to cast vote.

II. In case of any queries, you may refer the Frequently Asked Questions (FAQs) for Shareholders and e-voting user manual for Shareholders available at the Downloads section of www.evoting.nsdl.com

III. If you are already registered with NSDL for e-voting then you can use your existing user ID and password/PIN for casting your vote.

IV. You can also update your mobile number and e-mail id in the user profile details of the folio which may be used for sending future communication(s).

V. The e-voting period commences on June 10, 2014 (6:00 am) and ends on June 12, 2014 (12:00 pm). During this period shareholders' of the Company, holding shares either in physical form or in dematerialized form, as on the cut-off date is May 16, 2014, may cast their vote electronically. The e-voting module shall be disabled by NSDL for voting thereafter. Once the vote on a resolution is cast by the shareholder, the shareholder shall not be allowed to change it subsequently.

VI. The voting rights of shareholders shall be in proportion to their shares of the paid up equity share capital of the Company as on the cut-off date is May 16, 2014.

VII. Mr. Ashish C Doshi, Company Secretary in practice has been appointed as the Scrutinizer to scrutinize the e-voting process in a fair and transparent manner.

VIII. The Scrutinizer shall within a period not exceeding three(3) working days from the conclusion of the e-voting period unblock the votes in the presence of at least two(2) witnesses not in the employment of the Company and make a Scrutinizer's Report of the votes cast in favour or against, if any, forthwith to the Chairman of the Company.

IX. The Results shall be declared on or after the Annual General Meeting of the Company. The Results declared along with the Scrutinizer's Report shall be placed on the Company's website www.clarislifesciences.com and on the website of NSDL within two(2) days of passing of the resolutions at the Annual General Meeting of the Company and communicated to the BSE Limited

EXPLANATORY STATEMENT PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013:

ITEM NO. 4

Pursuant to General Circular No. 04/2014 dated 25th March, 2014 issued by the Ministry of Corporate Affairs and in further pursuance to the provision of Section 180(1)(c) of the Companies Act, 2013 (previously being Section 293(1)(d) of the Companies Act, 1956) and further in supersession of the earlier resolution passed at the 17th Annual General Meeting held on April 30, 2012, the Board of Directors cannot, except with the consent of the company in general meeting, borrow moneys (apart from temporary loans obtained from the company's banker in the ordinary course of business) in excess of the aggregate of the paid-up capital and free reserves, that is to say, reserves not set apart for any specific purpose. In such circumstance, approval of the shareholders is being requested to enable the Directors to borrow money to the extent of Rs. 750 Crores (rupees seven hundred and fifty crores only) from lenders as stated above.

None of the Directors, Key Managerial Personnel or their relatives are in any way concerned or otherwise interested in this resolution

Your Directors recommend the resolution for your approval as a Special Resolution.

ITEM NO. 5

Mr. Surrinder Lal Kapur is an Independent and Non - Executive Director of the Company. He was appointed as a Director of the Company on



September 26, 2008. He holds a post graduate degree in Mathematics and is a graduate in Law from Punjab University. He has completed his training in public administration from the National Academy of Administration, Mussoorie. He has a practical experience in banking and promotion of industrial investments. He works as an honorary adviser to the President, PHDCCI (PHD Chamber of Commerce & Industry, a regional chamber of commerce covering 11 Northern States and Union Territories of India). He served in the Indian Administrative Service for about 35 years. He retired from Public Service as Chairman of the Board for Industrial and Financial Reconstruction. He is practising as an Advocate and is proprietor of a law firm known as “S.L. Kapur & Associates”. He has floated a charitable trust known as Poverty Alleviation through Generation of Employment Trust to provide employment opportunities to youth belonging to backward classes and rural areas. He is holding nil shares of the Company as on date.

Mr. Surrinder Lal Kapur was appointed as a, Director of the Company prior to 1st April, 2014, being the date of notification of section 149 of the Companies Act, 2013. He is eligible to continue as an 'Independent Director' under the Companies Act, 2013 (the “Act”) and the revised Clause 49 of the Listing Agreement with the Stock Exchanges that will come into effect from 1st October, 2014. However, the records of the Ministry of Corporate Affairs need to take a note that the said Director is an 'Independent Director' being appointed prior to 1st April, 2014, and is not liable to retire by rotation pursuant to section 149(13) of the Act. Pursuant to section 149(10) of the Act, an Independent Director shall hold office for a term up to five consecutive years on the Board of a company. Pursuant to Explanation to sub-section (11) of section 149 of the Act, any tenure of an Independent Director on the date of commencement of the Act shall not be counted as a term for the purpose of counting his term in office. Pursuant to the revised Clause 49 of the Listing Agreement that is made applicable with effect from 1st October, 2014 by the Securities and Exchange Board of India, any person who has already served as an Independent Director for five years or more in a company as on 1st October, 2014 shall be eligible for appointment on completion of his present term for one more term of up to five years only.

Hence, Mr. Surrinder Lal Kapur, who has already served for more five years or more, is eligible for appointment for only one term of 5 consecutive years on completion of his term.

The Members are requested to consider the continuation of Mr. Surrinder Lal Kapur as an Independent Director under the Companies Act, 2013 whose period of office shall not be liable to retire by rotation.

None of the Directors, Key Managerial Personnel or their relatives are in any way concerned or otherwise interested in this resolution except Mr. Surrinder Lal Kapur.


ITEM NO. 6

Mr. T. V. Ananthanarayanan is the Non-Executive and Independent Director of the Company and was appointed as Director of the Company on January 28, 2008. He holds a Master of Science degree in Biomedical engineering from the Indian Institute of Technology, Chennai, and is a graduate in Mechanical Engineering from the Indian Institute of Technology, Chennai. Mr. T. V. Ananthanarayanan is a Trained Behavioural Scientist and Yoga Teacher apart from being an Engineer; He is the founder of the consulting firm "FLAME TAO Knoware"—a team of functional experts all of whom are Behavioural Scientists focusing on Organizational Transformation, Alignment and Optimization; he is one of the founders of Sumedhas Academy for Human Context—a nonprofit organization focusing on developing behavioral scientists. He is also a founder trustee of The Barefoot Academy of Governance. His consulting experience spans three decades: organization turnarounds, leadership coaching, culture transformations. His clients include TCS, Infosys, Laxmi Machine Works, ITC and EPCOS. He pioneered the use of Yoga and Theatre in process work. He has published many papers and three books: Learning through Yoga, The Totally Aligned Organization and Organization Alignment and Development (co-authored with Gagandeep Singh). His goal is to develop a unique approach to management at a personal level and at an organizational level based on the three streams of his expertise namely, Lean Management, Yoga and Behavioural Sciences. He is holding nil shares of the Company as on date.

Mr. T. V. Ananthanarayanan was appointed as a Director of the Company prior to 1st April, 2014, being the date of notification of section 149 of the Companies Act, 2013. He is eligible to continue as an 'Independent Director' under the Companies Act, 2013 (the “Act”) and the revised Clause 49 of the Listing Agreement with the Stock Exchanges that will come into effect from 1st October, 2014. However, the records of the Ministry of Corporate Affairs need to take a note that the said Director is an 'Independent Director' being appointed prior to 1st April, 2014, and is not liable to retire by rotation pursuant to section 149(13) of the Act. Pursuant to section 149(10) of the Act, an Independent Director shall hold office for a term up to five consecutive years on the Board of a company. Pursuant to Explanation to sub-section (11) of section 149 of the Act, any tenure of an Independent Director on the date of commencement of the Act shall not be counted as a term for the purpose of counting his term in office. Pursuant to the revised Clause 49 of the Listing Agreement that is made applicable with effect from 1st October, 2014 by the Securities and Exchange Board of India, any person who has already served as an Independent Director for five years or more in a company as on 1st October, 2014 shall be eligible for appointment on completion of his present term for one more term of up to five years only.

Hence, Mr. T. V. Ananthanarayanan, who has already served for more five years or more, is eligible for appointment for only one term of 5 consecutive years on completion of his term.

The Members are requested to consider the continuation of Mr. T. V. Ananthanarayanan as an Independent Director under the Companies Act, 2013 whose period of office shall not be liable to retire by rotation.

None of the Directors, Key Managerial Personnel or their relatives are in any way concerned or otherwise interested in this resolution except Mr. T. V. Ananthanarayanan.




ITEM NO. 7

Mr. Anup P. Shah is the Non-Executive and Independent Director of the Company and was appointed by the Board of Directors on 23rd February, 2013. He is a Fellow Member of the Institute of Chartered Accountants of India, a Commerce and a Law Graduate from the Mumbai University. Presently, he is the Managing Partner of M/s. Pravin P. Shah & Co, Chartered Accountants. Mr. Anup has hands-on experience in Legal, Financial, and Tax Consultancy, including Business Restructuring, Transaction Structuring, Capital Markets Regulations, Foreign Investments, PE Investments, Business Valuations, Real Estate Structuring, Corporate Governance issues, Accounting Advisory, etc. He has authored/ co-authored several books and contributed over 175 Articles. He is an Independent Director and Chairman of Audit Committee of Ruby Mills Ltd and Independent Director and Member of the Audit Committee of Jai Corp Ltd. He is also on the Board of Landmark Business Service Centre Private Limited, Knowhowhub.com Private Limited, Macro Investment & Financial Consultants Private Limited and also the Founder Director of Health & Education Foundation, a section 25 Company, dedicated to the cause of Prevention / Treatment of Heart Disease and providing Education to needy children. He is holding NIL shares of the Company as on date.

Mr. Anup P. Shah was appointed as a Director of the Company prior to 1st April, 2014, being the date of notification of section 149 of the Companies Act, 2013. He is eligible to continue as an 'Independent Director' under the Companies Act, 2013 (the “Act”) and the revised Clause 49 of the Listing Agreement with the Stock Exchanges that will come into effect from 1st October, 2014. However, the records of the Ministry of Corporate Affairs need to take a note that the said Director is an 'Independent Director' being appointed prior to 1st April, 2014, and is not liable to retire by rotation pursuant to section 149(13) of the Act. Pursuant to section 149(10) of the Act, an Independent Director shall hold office for a term up to five consecutive years on the Board of a company. Pursuant to Explanation to sub-section (11) of section 149 of the Act, any tenure of an Independent Director on the date of commencement of the Act shall not be counted as a term for the purpose of counting his term in office. Pursuant to the revised Clause 49 of the Listing Agreement that is made applicable with effect from 1st October, 2014 by the Securities and Exchange Board of India, any person who has already served as an Independent Director for five years or more in a company as on 1st October, 2014 shall be eligible for appointment on completion of his present term for one more term of up to five years only.

Hence, Mr. Anup P. Shah, who was appointed on February 23, 2013, is eligible for re-appointment for a further term of five consecutive years after the initial five years.

The Members are requested to consider the continuation of Mr. Anup P. Shah as an Independent Director under the Companies Act, 2013 whose period of office shall not be liable to retire by rotation.

None of the Directors, Key Managerial Personnel or their relatives are in any way concerned or otherwise interested in this resolution except Mr. Anup P. Shah.


ITEM NO. 8

Mr. Chetan S. Majmudar holds a Bachelor of Science degree from Saurashtra University, Rajkot. He joined our Company on April 1, 1999 and has around 38 years of experience in the pharmaceutical industry. He oversees the technical aspects of our Company. He has been involved in obtaining various regulatory approvals from authorities such as USFDA, MHRA & TGA for our Clarion manufacturing facilities. Prior to joining our Company, he was an employee of Core Healthcare Limited. He is responsible for development, manufacturing and quality of products.

Mr. Chetan S Majmudar is neither a Managing Director nor a Whole Time Director nor a Manager in any other Company. He is also not in whole time employment elsewhere. He is a citizen of India and also resident of India.

Keeping in view his experience in the pharmaceutical industry and more especially his vast knowledge of technical aspects, the Board of Directors of the Company on recommendation of the Remuneration/ Compensation Committee and subject to the approval of the Members and other approvals if any, re-appoints Mr. Chetan S. Majmudar as a Whole Time Director of the Company for a further period of 3 years w.e.f. 1st July, 2014 on the following terms and conditions:

Salary : Rs. 500,000/- per month.

Annual Increment : The Board will grant annual increments from time to time up to 40% of the last drawn salary to be decided by the Board of Directors and revise the Salary within the aforesaid range by granting one or more increments in the above scale, having regard to the merits and performance.

Perquisites: Besides the above salary, Mr. Chetan shall be entitled to the following perquisites:

(a) Perquisites including allowances in such form and to such extent as may be decided by theBoard of Directors or Remuneration / Compensation Committee (or the Nomination and Remuneration Committee) subject to a ceiling of annual salary.

(b) Company's contribution to Provident Fund and Superannuation or Annuity Fund to the extent these either singly or taken together are not taxable under the Income tax Act, gratuity payable as per the Rules of the Company and encashment of leave at the end of his tenure as per the Rules of the Company applicable to senior executives and the same shall not be included in the computation of limits for the remuneration or perquisites aforesaid.



If, in any financial year, the Company has no profits or its profits are inadequate, then in such event, notwithstanding the provisions of Section II of Part II of Schedule V to the Companies Act, 2013 but subject to the approval of the Central Government as may be required, the remuneration as set out above, will be paid as minimum remuneration.

Other terms :a) Leave: On full pay and allowances, as per the Rules of the Company, but not exceeding one month's leave for every 11 months of service.

b) Reimbursement of entertainment and/or travelling, hotel and other expenses actually incurred by him in the performance of duties.

c) Mr. Chetan S. Majmudar shall not be entitled for sitting fees for attending meetings of the Board of Directors of the Company or Board Committees so long as he functions as the Executive Director of the Company.

d) Subject to the provisions of the Companies Act, 2013, Mr. Chetan S Majmudar shall not, while he continues to hold office, be subject to retirement by rotation of Directors and they shall not be reckoned as a Director for the purpose of determining the rotation or retirement of Directors or in fixing the number of Directors to retire.

e) The re-appointment may be terminated by either party giving to the other party ninety days' notice in writing.

f) In the event of any dispute or difference arising at any time between Mr. Chetan S Majmudar and the Company in respect of the Agreement or the construction thereof, the same will be submitted to and be decided by Arbitration in accordance with the provisions of the Arbitration and Conciliation Act, 1996.

None of the Directors except Mr. Chetan S Majmudar is deemed to be interested in the above resolution.


Note on appointment of M/s Shah & Shah Associates, Chartered Accountants, Ahmedabad, as Statutory Auditors of the Company (Item No. 3)

M/s Shah and Shah Associates, Chartered Accountants, Ahmedabad (FRN 113742W) are proposed to be appointed as the new Statutory Auditors of the company to hold office from the conclusion of this Annual General Meeting until the conclusion of next Annual General Meeting of the Company in place of the retiring Auditors, namely, M/s. Deloitte Haskins & Sells, Chartered Accountants. The company felt that although statutorily not required but as part of proactive governance and considering the auditor rotation concept introduced by the Companies Act, 2013 it would be appropriate to voluntarily change the Auditors.

The Company has received special notice of a resolution from a Member of the Company, in terms of the applicable provisions of the Companies Act, 1956 which is also in compliance with the Companies Act,2013, signifying his intention to propose the appointment of M/s Shah & Shah Associates, Chartered Accountants, Ahmedabad as the statutory auditors of the Company from the conclusion of this Annual general meeting till the conclusion of the next Annual General meeting of the Company.

Based on the recommendation of the Audit Committee, the Board of Directors, has recommended the appointment of M/s Shah & Shah Associates, Chartered Accountants, Ahmedabad, as Statutory Auditors of the Company for the financial year 2014 in place of M/s Deloitte Haskins & Sells, Chartered Accountants.

M/s Shah & Shah Associates, Chartered Accountants, Ahmedabad have expressed their willingness to act as the statutory auditors of the Company, if appointed, and have further confirmed that the said appointment would be in conformity with the provisions of Section 224 of the Companies Act, 1956 which is also in compliance with the Companies Act,2013.

The Member’s approval is being sought for the appointment of M/s. Shah & Shah Associates, Chartered Accountants, Ahmedabad as the statutory auditors of the Company and to authorise the Board of Directors, on recommendation of the Audit Committee, to determine the remuneration payable to them.

None of the Directors is concerned or interested in this resolution.

Your Directors recommend the resolution for your approval.

Place : AhmedabadDate : May 9, 2014

Registered Office : Claris Corporate Headquarters,Nr. Parimal Railway Crossing, Ellisbridge, Ahmedabad 380006, IndiaTel. No. +91-79-2656 3331Fax: +91-79-2640 8053/ 2656 5879Website: CIN: L85110GJ1994PLC022543


By order of the Board of DirectorsFor Claris Lifesciences Limited


RESULTS OF OPERATIONS:During the financial year under review your Company’s income from net sales stood at Rs. 65,837.55 Lacs as against Rs. 76,272.34 Lacs in the previous year. As highlighted earlier, the previous year’s figures are not comparable in view of the divestment of Infusion business on July 31, 2013.

Our revenues from international markets stood at Rs. 43,827.02 Lacs as compared to Rs. 40,671.23 Lacs in previous financial year representing 66.57% of the net revenues as compared to 53.32 % of previous financial year.

EBITDA, PBT and PAT reached to Rs. 20,997.40 Lacs, Rs. 10,748.55 Lacs and Rs. 8,440.97 Lacs respectively as against Rs.27,510.29 Lacs, Rs.13,578.12 Lacs and Rs.10,391.12 Lacs respectively, in the previous year.

As a percentage of net sales, the EBITDA, PBT and PAT margins stood at 31.89%, 16.33% and 12.82% respectively in fiscal year 2013 compared to 36.07%, 17.80% and 13.62% respectively in the previous year.

The Company reported gain of Rs.1505.98 Lacs on sale of it’s infusion business to Claris Otsuka Limited, the erstwhile wholly-owned subsidiary of the company.

Detailed analyses of the financials have been provided in the Management Discussion and Analysis which is a part of this Directors Report.

JOINT VENTURE:During the year, the Company has transferred its Infusion business for India and Emerging Markets to Claris Otsuka Limited on a slump sale

Directors' Reportbasis; for a total cash consideration of Rs.103182.42 Lacs (Rs.105040.00 Lacs cash consideration less Rs.1857.38 Lacs for liabilities transferred) for the net assets of infusion business transferred in favour of Claris Otsuka Limited. Post this transaction, the Company is continuing to hold 20% of the Claris Otsuka Limited and Otsuka Pharmaceutical Factory Inc., Japan and Mitsui & Co. Ltd., Japan will hold 60% and 20% respectively in Claris Otsuka Limited.

As a part of this transaction, the Company has transferred its infusion products namely Common Solutions, Anti-Infective, Plasma Volume Expanders and Parenteral Nutrition therapies for India and Emerging Markets to Claris Otsuka Limited.

FURTURE OUTLOOK / GROWTH PLANS:The Company will focus on its speciality generics injectables business and will target its next phase of growth through new product launches in international market, especially in the key Regulated Markets of US and European Union. The Company will increase its focus on development and launch of niche products targeted for the US and EU, the company intends to build a pipeline of 100 ANDAs for the US over the next three years, some of these products may also be acquired inorganically.

To meet the growing demands of Injectable products in the International Markets the company has commenced projects for capacity expansion to meet the growing demand of its products in the US and EU and to introduce new delivery systems. As part of the expansion process, two projects have been initiated for the year 2014, (i) packaging automation for the flagship plant Clarion 1, this will increase the overall capacities of the plant; and (ii) Installation of two manufacturing lines in Clarion 5, these lines will cater to Aseptic as well as Terminally Sterilised products and also have the capability to manufacture Lyophilised products.

DIVIDEND:Your Company has declared and paid an interim dividend of Rs. 9/- per equity share of Rs. 10/- each (i.e. 90%) on January 7, 2014 for the year 2013, which was paid on February 4, 2014 to the members of the Company as on record date January 21, 2014. The total outflow on account of dividend payments, including distribution tax, was Rs. 6,719.72 Lacs ( FY2012 Rs. 1,483.41 Lacs).

TRANSFER TO RESERVES:Your Company has transferred Rs. 830.00 Lacs to the General Reserves. An amount of Rs. 65,585.06 Lacs is to be retained in the Profit and Loss Account (of consolidated accounts).

SUBSIDIARIES:Your Company has 13 International and 4 Indian Subsidiaries as on December 31, 2013. During the year, Claris Otsuka Limited was discontinued as the subsidiary of your Company on and from July 31, 2013 upon the completion of transfer of infusion business for India and emerging markets to the Claris Otsuka Limited.

Accounts of Subsidiaries:Pursuant to General Circular No.2/2011 dated February 8, 2011 issued by Ministry of Corporate Affairs, the Company in its meeting held on February 28, 2014 has availed the general exemption from attaching a copy of the Balance Sheet, Statement of Profit and Loss, Directors’ Report and Auditors’ Report of the Subsidiary Companies and other documents required to be attached under Section 212(1) of the Companies Act, 1956, to the Balance Sheet of the Company for the financial year ended December 31, 2013.

Accordingly, in accordance with the Accounting Standard AS-21 on Consolidated Financial Statements read with the Accounting Standard AS-23 on Accounting for Investments in Associates notified under Section 211(3C) of the Companies Act, 1956 the Audited Consolidated Financial Statements are provided in the Annual Report. The Annual

Dear Members,

Your Directors are pleased to present the nineteenth Annual Report of the Company and Annual Audited Accounts for the financial year ended December 31, 2013.

FINANCIAL RESULTS:Your company has, on 31st July, 2013 transferred its Infusion business to Claris Otsuka Limited in which your Company holds 20% of its equity capital and which was an erstwhile wholly-owned subsidiary company of your Company. Hence the audited figures for the financial year under review with the previous year are not comparable.

The financial highlights of the Company on Consolidated and Standalone basis are as below:

Particulars Consolidated Standalone

(Rupees in lacs)

IncomeProfit before Interest, depreciation and taxFinance CostsDepreciation & AmortisationExceptional ItemProfit after exceptional itemsProvision for taxProfit after taxShare in Loss of AssociateNet Profit / (Loss) after taxes and share in loss of associatesBalance brought forward from previous yearBalance available for Appropriation:Proposed DividendCorporate tax on dividendTax on Dividend of earlier yearTransfer to General ReserveBalance carried to Balance Sheet

70,834.9520,997.40

5,219.456,535.381,505.98

10,748.552,207.718,540.84

(99.87)8,440.97

64,703.67

5,743.60976.12

9.86830.00

65,585.06

2013

77,766.1927,510.29

6,505.267,426.91

-13,578.123,187.00

10,391.12-

10,391.12

56,360.96

1,276.35207.06

-565.00

64703.67

2012

67,867.5319,821.11

5,210.125,796.111,505.98

10,320.862,199.018,121.85

-8,121.85

46,885.57

5,743.60976.12

9.86830.00

47,447.84

2013

73,014.5324,343.67

6,491.247,179.44

(45.10)10,627.893,186.277,441.62

-7,441.62

41,492.36

1,276.35207.06

-565.00

46,885.57

2012


Accounts of the Subsidiary Companies and the related detailed information will be made available to the members of the holding and subsidiary companies seeking such information at any point of time. The Annual Accounts of the Subsidiary Companies will also be kept for inspection by any members at the Registered Office of the holding company and at the concerned subsidiary companies.

INTERNAL CONTROL SYSTEM:The Company has a reasonable internal control system, which ensures that all assets are protected against loss from unauthorized use and all transactions are recorded and reported correctly. The internal control systems are further supplemented by internal audit carried out by an independent firm of Chartered Accountants and periodical review by management. The Audit Committee of the Board of Directors addresses issues raised by both, the Internal Auditors and the Statutory Auditors.

FIXED DEPOSITS:Your Company has not accepted any fixed deposit under Section 58A of the Companies Act, 1956.

INSURANCE:The assets/ properties of the Company are adequately insured against the loss of fire, riots, earthquake, terrorism, etc and other risks that are considered necessary by the management. Apart from the above, your Company has also Product as well as Director’s and Officer’s Liability Insurance Policies.

DIRECTORS:Mr. Aditya S. Handa, Director of the Company, retire by rotation at the conclusion of this Annual General Meeting and being eligible offer himself for reappointment.

The brief resume of the Director retiring by rotation and seeking re-appointment at the ensuing Annual General Meeting, as stipulated under clause 49 of the Standard Listing Agreement with the Stock Exchange, is given in section “Report on Corporate Governance” of the Annual Report.

DIRECTORS' RESPONSIBILITY STATEMENT:Pursuant to the requirement under section 217(2AA) of the Companies Act, 1956, with respect to the Directors' Responsibility Statement, it is hereby confirmed:

1. That in the preparation of the accounts for the financial year ended December 31, 2013, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

2. That the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that were 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 the year under review;

3. That the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. That the Directors have prepared the accounts for the financial year ended December 31, 2013 on a 'going concern’ basis.

AUDITORS:M/s Shah and Shah Associates, Chartered Accountants, Ahmedabad (FRN 113742W) as the new Statutory Auditors of the company to hold office from the conclusion of this Annual General Meeting until the conclusion of next Annual General Meeting of the Company in place of the retiring Auditors, namely, M/s. Deloitte Haskins & Sells, Chartered Accountants, although statutorily not required but appropriate to voluntarily change, as part of proactive governance and considering the auditor rotation concept introduced by the new Companies Act. Further, M/s Shah and Shah Associates, Chartered Accountants, Ahmedabad (FRN 113742W), have given their willingness to be appointed as

Statutory Auditors of the Company and have also furnished a certificate as required under provision of the section 224(1B) of the Companies Act, 1956 to the effect that their appointment, if made, will be in accordance with the limits specified in the sub-section (1B) of section 224 of the Companies Act, 1956.The Notice convening the said Annual General Meeting contains the said resolution.

The Board of Directors places on record appreciation of the services rendered by M/s. Deliotte Haskins & Sells, Chartered Accountants, Ahmedabad to the Company .

COST AUDITOR:Pursuant to Section 233B of the Companies Act, 1956, M/s. Kiran J. Mehta & Co., Cost Accountants, Ahmedabad was appointed as Cost Auditors of the Company in respect of cost audit of the Company’s pharmaceutical activities for the year ended December 31, 2013. Report of the Cost Auditor in respect of Cost Audit for the year under review will be filed with the Central Government in due time period.

ENERGY, TECHNOLOGY AND FOREIGN EXCHANGE:The information required under the Companies Act, 1956 as given in Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is given in the Annexure – I.

PARTICULARS OF EMPLOYEES:Employees are vital to the Company. Your Company has created a favourable work environment that encourages innovation and meritocracy. Your Company has staff strength of 959 employees as at December 31, 2013 compared to staff strength of 1558 employees as at December 31, 2012. The reduction is on account of transfer of its Infusion business for India and Emerging Markets to Claris Otsuka Limited and subsequent transfer of concerned employees to Claris Otsuka Limited.

Particulars of employees covered under section 217(2A) of the Companies Act, 1956 are attached read with Companies (Particulars of Employees) Rules, 1975 and forms part of this Annual Report. However, as per Section 219(1)(b)(iv) of the Companies Act, 1956, the Annual Report is being sent to all members excluding the said annexure. Any member interested in obtaining the particulars may obtain the same in writing to the Company Secretary of the Company or the same is available for inspection at the Registered Office of the Company during the working hours of the Company.

CORPORATE GOVERNANCE:Pursuant to Clause 49 of the Listing Agreement, a “Report on Corporate Governance” forms a part of Annual Report.

MANAGEMENT DISCUSSION & ANALYSIS:Pursuant to Clause 49 of the Listing Agreement, “Management Discussion & Analysis” is given separately forming part of this Annual Report.

ACKNOWLEDGMENT:The Board of Directors greatly appreciates the commitment and dedication of employees at all levels who have contributed to the growth and success of the Company. We also thank all our clients, vendors, investors, bankers and other business associates for their continued support and encouragement during the year.

We also thank the Government of India, Government of Gujarat, Ministry of Commerce and Industry, Ministry of Finance, Customs and Excise Departments, Income Tax Department, and all other Government Agencies for their support during the year and look forward to their continued support in the future.

Directors' Report

For and on Behalf of Board

Arjun HandaManaging Director & CEO

Place : AhmedabadDate : February 28, 2014

Chandrasingh S. PurohitWhole Time Director


Annexure-I to the Directors’ ReportParticulars required under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988

I. CONSERVATION OF ENERGY

Energy conservation means the efforts made by the company to reduce the consumption of energy and reduces its dependency on power generated from fossil fuels. Energy requirement of any growing company keeps on increasing year on year and considering the same your company has decided to increase the capacity of its existing bio mass based power plant. As informed during the earlier

years, your Company has power plant capacity of generating 4.25 Mw. And, also has 2 Mw solar power plant under Jawaharlal Nehru Solar Mission with the objective of renewable power generation and supply of green and clean electricity. This solar power plant is based on SPV (Solar Photovoltaic) connected to grid. These steps signify company’s initiatives to replace non renewable energy source with a renewable energy source.

Power and Fuel ConsumptionElectricity PurchasedUnits (kwh)Total Amount (Rs.)Rate / Unit (Rs.)

Own generation[D G Set]Through diesel generator

Units generated (kwh)Total Cost of Diesel (Rs.)Cost/Unit (Rs.)

Furnace OilQuantity (Kgs)Total Amount (Rs.)Rate / Unit (Rs.)

Co-generation (Power Plant)PowerUnit generated (kwh)Total Amount (Rs.)Rate / Unit (Rs.)

SteamUnit generated (kgs)Total Amount (Rs.)Rate / Unit (Rs.)

2013

18,415,839115,149,309

6.25

15,312654,678

42.76

92,8844,554,922

49.04

18,663,800112,775,707

6.04

81,103,950114,613,001

1.41

2012

27,418,142184,800,246

6.74

27,0161,022,043

37.83

426,19221,513,327

50.48

7,432,70033,403,533

4.49

120,060,110119,603,920

1.00

Below is the cost of power and steam generation for the year ended on December 31, 2013 and that for the year ended on December 31, 2012.

Sr. No

A

1

2

3

B1

2

II. RESEARCH AND DEVELOPMENT

Products and its related Marketing Authorization is the biggest asset of the Generic Pharmaceutical Company. Keeping this in mind, Claris has always focused on niche injectable products and strives to build a robust product pipeline of generic specialty injectable products for worldwide markets with special interest in the regulated markets. The company's commitment to research is manifested through its strong R&D team capable of developing complex and difficult to manufacture products. The Company has a team of more than 70 for R&D working at different levels with the common goal of strengthening the Product Pipeline of the Company.

Following new types of delivery systems introduced in this year• Injections in glass vials• Injection in Infusion Bags

14 Claris Lifesciences Limited - Annual Report 2013

Regulatory Filing & Approvals in 2013• 5 ANDAs approval received from US & 23 MA Approvals from EU• 3 ANDAs & 7 PAS (Prior Approval Submissions) filed in US• 39 applications filed in EU & 23 applications in Other Regulated Markets• 125 Applications filed in ROW market

a. Main Area of FocusClaris is continuing the R&D spend keeping in mind following:

1. New Products targeting the Regulated Markets especially USA & Europe and to meet the product shortages in highly regulated market.2. Increase in the product basket for sales across Emerging Markets.

b. Benefits Derived1. A Larger product basket across multiple therapeutic segments benefits the company to increase its market share.2. New technologies and products allow the company to market its products across a wider segment and target a larger revenue and market share

across countries.3. Better formulations could result in reduction of costs of therapy.4. To open us new specialized area of products for commercialization5. This will pave way for the commercialization and improved utilization of the SVP capacity which we are planning to put by middle of 2014.

c. Future Plan of Action1. Expanding product baskets across various therapies for International markets.2. Targeting 70 ANDA pipeline for the US over the next 3-4 years.3. Aggressive registration strategy in all International markets for future sales.4. Planning to develop some new products in Aseptic & Lyophilization technology.5. Products to be developed across therapeutic segments like Anesthesia & Analgesia, Antidotes, and Detoxifying Agents.6. Inhouse API development for Claris captive consumption & submission of these finished formulations in USA & Europe for better cost

efficiency and redundancy.

d. Expenditure on R&DThe total expenditures for research and development (R&D) activities relating to continuing operations were Rs. 335.24 Lacs and Rs. 230.47 Lacs for the financial year ended December 31, 2013 and December 31, 2012 respectively.

III. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION:

Efforts, in brief, made towards technology absorption, adaptation and innovation. The Company has embraced state-of-art technology for its manufacturing facility. The technology has been developed in co-operation with world-renowned technology leaders across the globe. With this level of automation and technology, the company is equipped to compete with the global competitors in terms of product quality and cost.

Technology absorption is not involved as the process for manufacture of bulk drug/formulation is being developed inhouse by the company.

Cost optimization initiative with respect to less expensive actives, excipients, packaging materials change over in commercialized products. These will result in annualized savings worth millions of rupees when approved and implemented.

Foreign Exchange Earnings and outgoThe export earnings during the year amounted to Rs. 35,644.23 Lacs (previous year Rs. 34,002.90 Lacs) Expenditure (gross) in foreign currency during the year amounted to Rs. 3,634.29 Lacs (previous year Rs. 2,557.77 Lacs). Expenditure is on accrual basis.

Annexure-I to the Directors’ Report

For and on Behalf of Board




15Claris Lifesciences Limited - Annual Report 2013

COMPANY’S PHILOSOPHY

Claris Lifesciences Limited philosophy envisages the attainment of the highest standards of Corporate Governance by timely disclosures, transparent accounting policies, responsibility and fairness. Its endeavour is to maximize the long term value of the Shareholders of the Company.

BOARD OF DIRECTORS

The Board of Directors comprises of 7 Directors as on December 31, 2013. Out of this, three are Independent Directors (including Chairman), three Executive Directors and one Non-Executive Director.

Composition, Category & Designation of Directors

Notes :1. Mr. Anup P. Shah was appointed as an Additional Independent Non-Executive Director on February 23, 2013 and was regularized as a Director on

April 12, 2013 at Annual General Meeting of the Company.

BOARD MEETINGS

Attendance of each Director at the Board Meetings, last Annual General Meeting and number of other directorship and Chairmanship/ Membership of Committees in various Companies.

* Includes only Chairmanship / Membership of the Audit Committee and the Shareholders’ Grievance Committee.** Excludes Directorship in Foreign Companies and Non Profit Organisation.

Number of Board Meetings held and the dates on which held

Four meetings of the Board of Directors were held during the year ended 31st December, 2013 on February 23, 2013, May 10, 2013, August 10, 2013 and November 13, 2013.

BRIEF RESUME OF THE DIRECTORS SEEKING APPOINTMENT/ RE-APPOINTMENT

Mr. Aditya S. Handa, a Non - Executive DirectorMr. Aditya S. Handa is a Non Executive Director of the Company. He holds a Master of Business Administration degree from Babson college USA and holds a Bachelor of Commerce degree from the Gujarat University, Ahmedabad. He was appointed as a Director of the Company on June 13, 2006 and has served as CFO of the Company from January 1, 2008 to March 31, 2009, which was his first employment. As on December 31, 2013, he is holding nil shares of the Company.

Report on Corporate Governance

Name of Director

Mr. Surrinder Lal Kapur

Mr. Arjun Handa

Mr. Aditya S. Handa

Mr. T. V. Ananthanarayanan

Mr. Chetan S. Majmudar

Mr. Chandrasingh S. Purohit

Mr. Anup P. Shah

Designation

Chairman

Managing Director & CEO

Director

Director

Whole Time Director

Whole Time Director

Director

Category

Independent Non Executive Director

Promoter and Executive Director

Non Executive Director


Executive Director

Executive Director


Name of Director

Number of other Directorships and Committee Memberships/

Chairmanships*Attendance Particulars

Mr. Arjun Handa

Mr. Aditya S. Handa





Mr. Anup P. Shah

Board Meetings

4

4

2

4

4

4

4

Last AGM

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Other Directorships

7**

6**

2

1**

4

4

5**

Committee MembershipsChairmanships

Committee Chairmanships

1

-

-

-

-

5

3

-

-

-

-

-

1

-

-

-

-

-

-

1

1


Report on Corporate GovernanceCODE OF CONDUCT

The Board of Directors of the Company has laid down a code of conduct for all the Board Members and Senior Management Group of the Company. The code of conduct is available on the website of the Company www.clarislifesciences.com. All the Board Members and Senior Management Group have affirmed compliance with the Code of Conduct. A declaration signed by the Managing Director & CEO to this effect is enclosed as a part of this Annual Report.

AUDIT COMMITTEE

The Board of Directors have constituted an Audit Committee to assist the Board in discharging its responsibilities effectively. The constitution, power, role etc of the Audit Committee meets with the requirements of Section 292A of the Companies Act, 1956 and Clause 49 (II) (A)/(B)/(C)/(D) and (E) of the Listing Agreement with Stock Exchange.

Composition and Terms of Reference

Prior to February 23, 2013, the Audit Committee comprised of three Members, namely, Mr. Arjun Handa, Mr. T. V. Ananthanarayanan and Mr. Surrinder Lal Kapur. Except for Mr. Arjun Handa, all other members of the Audit Committee were Independent.

The Audit Committee was re-constituted on February 23, 2013 comprising of four Members, namely, Mr. Anup P. Shah, Mr. Surrinder Lal Kapur, Mr. T. V. Ananthanarayanan and Mr. Chandrasingh S. Purohit. Mr. Anup P. Shah was appointed as Chairman of the Audit Committee by the Board on February 23, 2013. Except for Mr. Chandrasingh S. Purohit, all other members of the Audit Committee are Independent.

The Committee deals with accounting matters, financial reporting and internal controls. Terms of reference of Audit Committee specified by the Board are as contained in section 292A of the Companies Act, 1956 and Clause 49 of the Listing Agreement with Stock Exchanges.

Meetings and attendance during the year

The Committee met four times during the year ended December 31, 2013 on February 23, 2013, May 10, 2013, August 10, 2013 and November 13, 2013. All the members of the Audit Committee were present in all the meetings.

REMUNERATION/ COMPENSATION COMMITTEE

Composition and other details

Prior to February 23, 2013, the Remuneration/ Compensation Committee comprised of two Members, namely, Mr. Surrinder Lal Kapur and Mr. T V Ananthanarayanan. All the member of the Committee are Independent.

The Board has re-constituted Remuneration/ Compensation Committee comprising of three Members namely, Mr. Anup P. Shah, Mr. Surrinder Lal Kapur and Mr. T. V. Ananthanarayanan. Mr. T. V. Ananthanarayanan was appointed as Chairman of the Committee by the Board on February 23, 2013. All the members of the Committee are Independent. Terms of reference

The Committee evaluates and determines the Company’s remuneration policy, having regard to performance standards and existing industry practice and benefits for Executive Director(s)/ Senior Management Personnel and look after the issues relating to major HR policies.

Attendance during the year

No meeting was held during the year.

Remuneration Policy

The Remuneration Committee determines the Company’s remuneration policy, having regard to performance standards and existing industry practice. Under the existing policies of the Company, the Remuneration Committee, inter alia, determines the remuneration payable to the Directors.

Apart from discharging the above-mentioned basic functions, the Remuneration Committee also discharges the following functions:

• Framing policies and compensation including salaries and salary adjustments, incentives, bonuses, promotion, benefits, stock options and performance targets of the top executives; and

• Formulating strategies for attracting and retaining employees and employee & development programmes.



a) Executive Directors

The remuneration paid to Directors during the financial year ended December, 31, 2013 are as follows:

b) Non-Executive Directors

The sitting fees paid to Non-Executive Directors for attending meetings during the financial year ended December, 31, 2013 are as follows:

SHAREHOLDERS/ INVESTORS GRIEVANCE COMMITTEE:

As a measure of good Corporate Governance and focusing on strengthening the relation with the stakeholders, the Board has formed Shareholders/ Investors' Grievance Committee.

Constitution and CompositionPrior to February 23, 2013, the Shareholders/ Investors Grievance Committee comprised of three Members, namely, Mr. Arjun Handa, Mr. T. V. Ananthanarayanan and Mr. Chandrasingh S. Purohit.

The Board has re-constituted Shareholders/ Investors Grievance Committee comprising of five Members, namely, Mr. Anup P. Shah, Mr. Surrinder Lal Kapur, Mr. T. V. Ananthanarayanan, Mr. Arjun Handa and Mr. Chandrasingh S. Purohit. Mr. Surrinder Lal Kapur was appointed as Chairman of the Committee by the Board on February 23, 2013. All the members were present in all the meetings.

Compliance Officer

Mr. Kirit Kanjaria, VP – Company Secretary & Compliance Officer. Terms of Reference

The Committee was constituted to look into the Investors' complaints and to redress the same expediently. The Committee meets as and when there are any complaints from investors. The Company Secretary of the Company is the Compliance Officer. There were nil complaint pending to be resolved as on December 31, 2013.

Executive Directors

Mr. Arjun Handa



TOTAL

Perks (Rs.)

-

30,000

30,000

60,000

Salary (Rs.)

15,000,000

4,679,360

4,679,360

24,358,720

Other Allowances (Rs.)

50,000

50,000

50,000

150,000

Non-Executive Directors



Mr. Anup P. Shah

TOTAL

Amount in Rs.

2,40,000

2,40,000

2,40,000

7,20,000


Details of Complaints for the year 2013:

S.No

1

2

Nature of Complaints

Non- receipt of dividend warrant

Non- receipt of annual report

TOTAL

Received

2

1

3

Pending

Nil

Nil

Nil

Disposed

1

3

2

Details of Remuneration paid to Directors during the year


GENERAL BODY MEETINGS

Location and time for the Annual General Meetings held in the last three financial years:

Year

2012

2011

2010

Special Resolution

-----

-----

-----

Date / Time

12/04/2013

12:00 Noon

30/04/2012

12:00 Noon

12/05/2011

4.00 P.M.

Venue

Ahmedabad Management Association,

J. B. Auditorium,

ATIRA campus,

Dr.Vikram Sarabhai Marg,

Ahmedabad – 380015


H.T.parekh convention centre,

ATIRA campus, Dr.Vikram Sarabhai Marg,

Ahmedabad - 380015


H. T. Parekh convention centre,

ATIRA campus,

Dr.Vikram Sarabhai Marg,

Ahmedabad - 380015

Special Resolution passed last year through Postal Ballot

No Special Resolution was passed last year through Postal Ballot.

DISCLOSURES

Disclosures on materially significant related party transactions that may have potential conflict with the interest of the Company at large.

We have disclosed the material significant related party transactions in the Notes forming part of the financial statements.

Details of non-compliance by the company, penalties, strictures imposed on the company by Stock Exchange or SEBI or any statutory authority, on any matter related to capital markets, during the last three years.

Nil.

Whistle Blower policy and affirmation that no personnel has been denied access to the audit committee.

The Company affirms that no personnel has been denied access to the audit committee.

Details of compliance with mandatory requirements and adoption of the non- mandatory requirements of this clause.

All the mandatory requirements has been complied by the Company. The Company is in process to adopt certain Non-Manadatory requirments including Whistle Blower Policy.

MEANS OF COMMUNICATION

ResultsThe quarterly, half-yearly and yearly un-audited/ audited financial results of the Company were published as per Clause 41 of the Listing Agreement. The results are also uploaded on Company’s website : www.clarislifesciences.com


Report on Corporate GovernanceGeneral Information for Shareholders

Date, Time and Venue of Annual General Meeting : Tuesday, June 17, 2014 at 11.00 AM at Ahmedabad Management Association, J.B. Auditorium, ATIRA campus, Dr.Vikram Sarabhai Marg, Ahmedabad -380015

Financial Year of the Company : December 31, 2013. Financial Year 2014 (tentative)

20th Annual General Meeting : May- June 2015

Results for the quarter ended March 31, 2014 : Second week of May 2014

Results for the quarter ended June 30, 2014 : Second week of August 2014

Results for the quarter ended September 30, 2014 : Second week of November 2014

Results for the last quarter ended December 31, 2014 : Second week of February 2015

Book Closure dates

From June 13, 2014 to June 17, 2014 (both days inclusive) for the purpose of the Annual General Meeting.

Dividend Payment Date : No dividend is declared.

Listing on Stock Exchanges

The Company's Shares are listed on BSE Limited. The listing fee for the year 2013-14 has been paid to the above stock exchange. The Listing fee for the year 2014-15 will be paid on or before the due date.

Stock Codea) Scrip code Bombay Stock Exchange : 533288

Scrip ID Bombay Stock Exchange : CLARIS

b) Demat ISIN Numbers in NSDL & CDSL for Equity Shares : INE562G01018


Month

January 2013

February 2013

March 2013

April 2013

May 2013

June 2013

July 2013

August 2013

September 2013

October 2013

November 2013

December 2013

High

228.40

226.90

229.50

232.00

186.70

211.40

207.70

190.00

202.15

198.00

192.00

229.00

Monthly high / low stock quotations at BSE (Figure in Rs.)

Low

198.00

176.00

181.60

176.60

150.00

142.05

165.35

162.15

162.05

170.00

169.00

164.10

BSE


Share transfer systemThe Company has a Registrar and Share Transfer Agent. Share transfers, if documents are found to be in order, are registered and Certificates are returned in the normal course within two weeks from the date of receipt of the documents. Request for dematerialisation of shares are processed and confirmation given to the respective depositories i.e, National Securities Depositories Limited (NSDL) and Central Depository Services (India) Limited (CDSL) within seven days.


As on 01/01/2013

As on 31/12/2013

% Change

Share Price (Rs.)

211.10

192.95

-8.60

Share price performance in comparison to broad based indices - BSE Sensex

BSE Sensex

19,580.81

21,170.68

8.12

Share Price v/s. BSE

Total Equity Share Capital of the Company as on December 31, 2013 was 63,817,765 equity shares of Rs. 10/- each.

Registrar and Share Transfer Agents

LINK INTIME INDIA PRIVATE LIMITED

(Unit : Claris Lifesciences Limited)

C-13, Pannalal Silk Mills Compound

LBS Road, Bhandup (West)

Mumbai – 400 078

Contact Person : Prabhsharan Nottay

Tel No. : 25946970 Ext : 2303

e-mail : [email protected]

Website: www.linkintime.co.in

SEBI Registration No: INR00000 4058

No. of Equity Shares

Less than 500

501 – 1000

1001 – 2000

2001 – 3000

3001 – 4000

4001 – 5000

5001 – 10000

10000 and above

Total

No. of Shares

12,53,917

4,39,538

2,97,717

1,34,768

1,07,430

1,33,737

4,22,014

6,10,28,644

6,38,17,765

% to total Capital

1.96

0.69

0.47

0.21

0.17

0.21

0.66

95.63

100.00

No.of Shareholders

13,271

625

197

52

30

29

55

87

14346

% of total shareholders

92.51

4.36

1.37

0.36

0.21

0.20

0.38

0.61

100.00

Category

Company Promoter / Promoter Group

Mutual Funds / UTI

Financial Institutions / Banks

Foreign Institutional Investors

Non-Resident Indians

Non Resident Non- Repatriable

Foreign Venture Capital Investors

Qualified Foreign Investors - Corporate

Bodies Corporate

General Public

Clearing Members

TOTAL

% Shareholding

60.21

0.28

0.00

14.86

0.36

0.33

11.14

2.81

4.48

4.68

0.85

100.00

No. of shares held

3,84,25,211

1,77,371

757

94,82,790

2,30,133

2,09,366

71,11,095

17,94,800

28,56,397

29,84,705

5,45,140

6,38,17,765

Shareholding Pattern as on December 31, 2013

Distribution of shareholding as on December 31, 2013



Dematerialisation of shares

The equity shares of the Company are in dematerialised form as on December 31, 2013 except 3 equity shares. Trading in Equity Shares of the Company is permitted only in dematerialised form.

Outstanding GDRs/ADRs/Warrants or any convertible instruments, conversion date and likely impact on equity: Nil.

Plant LocationsVillage : Chacharwadi, VasnaTaluka : SanandAhmedabad - 382213

Address for CorrespondenceFor Shares held in physical & Demat formLINK INTIME INDIA PRIVATE LIMITED(Unit : Claris Lifesciences Limited)C-13, Pannalal Silk Mills CompoundLBS Road, Bhandup (West)Mumbai – 400 078Website: www.linkintime.co.ine-mail : [email protected] Registration No: INR00000 4058

Any Query on Annual ReportClaris Lifesciences LimitedSecretarial DepartmentClaris Corporate HeadquartersNr. Parimal Railway Crossing, Ellisbridge,Ahmedabad – 380006, India

CIN: L85110GJ1994PLC022543For any other queries : Email :

Tel: +91-79-26563331, Fax:- +91-79-26408053/26565879Website: www.clarislifesciences.com

[email protected]

Place : AhmedabadDate : 28th February, 2014

Ashish C. DoshiPracticing Company SecretaryC.O.P No. : 2356


As provided under clause 49 of the Listing Agreement with the Stock Exchange, the Board Members and the Senior Management Group have confirmed compliance with the Code of Conduct for the year ended December 31, 2013.



For Claris Lifesciences Limited

Declaration on Compliance with

Code of Conduct

Report on Corporate GovernanceCOMPLIANCE CERTIFICATE ON CORPORATE GOVERNANCE

To the Members of Claris Lifesciences Limited, Ahmedabad.

We have examined the compliance of the conditions of Corporate Governance by Claris Lifesciences Limited for the year ended 31st December, 2013, as stipulated in clause 49 of the Listing Agreement of the said Company with stock exchanges.

The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to procedures and implementation thereof, adopted by the Company for ensuring compliance with the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.

In our opinion and to the best of our information and according to the explanations given to us and representation made by the management, we certify that the Company has complied with the conditions of the Corporate Governance as stipulated in the above mentioned Listing Agreement.

We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company.

The financial statements have been prepared in compliance with the requirements of the Companies Act, 1956 and Generally Accepted Accounting Principles (GAAP) in India. This discussion may contain forward-looking statements that involve risks and uncertainties. Except for the historical information contained herein, statements in this presentation and the subsequent discussions, which include words or phrases such as “will”, “aim”, “will likely result”, “would”, “believe”, “may”, “expect”, “will continue”, “anticipate”, “estimate”, “intend”, “plan”, “contemplate”, “seek to”, “future”, “objective”, “goal”, “likely”, “project”, “should”, “potential”, “will pursue” and similar expressions or variations of such expressions may constitute "forward-looking statements". These forward-looking statements involve a number of risks, uncertainties and other factors that could cause actual results, performance or achievements, to differ materially from those projected by the forward-looking statements. These risks and uncertainties include, but are not limited to our ability to successfully implement our strategy, our growth and expansion plans, obtain regulatory approvals, our provisioning policies, technological changes, investment and business income, cash flow projections, our exposure to market risks as well as other risks.

The Company cannot guarantee that the mentioned assumptions and expectations are accurate or will be realized; and also does not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date thereof.

GLOBAL PHARMACEUTICAL INDUSTRY Pharmaceutical industry overviewThe global pharmaceutical market has witnessed a 6% CAGR from 2006 to 2012 to reach a US$ 956 Billion market size in 2012. According to IMS Health, the global pharmaceutical spend is estimated to touch US$ 1.2 trillion by CY2016, growing at 4.5% annually. Growth will be primarily driven by higher generic spending (accounting for 3/4th of the total increase) and increasing medical expenditure.

Management Discussion & Analysis

24

Regulated Markets

USAThe US pharmaceutical market is value at US$ 322 Billion in 2011, is expected to grow at a CAGR of 1-4% over 2012-16, likely to reach a market value of 350-380 Billion by 2016 (Source: IMS).The year 2012 witnessed around US$ 35 Billion worth of drugs to go off patent (Source: India Pharmaceuticals- HSBC, 2012). The US generics market, worth US$ 100 Billion, is also estimated to register a CAGR of 8-9% in the medium term on account of patent expiries (Source: Fitch, 2013).

EUROPEEurope is one of the largest global pharmaceutical market (around 17%) after the US. In Europe, pharmaceutical market is likely to witness growth in the range of 1% to 2% by 2016. Sluggish growth is expected due to healthcare cost containment measures adopted in order to curtail the debt crisis. The 5 key EU nations are likely to touch a market size of US$ 125-175 Billion by 2016.

Country-wise pharmaceutical scenario

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

484 51

0 538 56

7 596 62

5 640 65

7 673 68

7 700

121

138

157

178

203

231 240

269

301 337

378

Generic Branded Generic

Global pharmaceutical and global generic sales by 2015

(Source: IMS Health, Barclays Research 2013)

Country

UK

GERMANY

FRANCE

SPAIN

ITALY

Market size in 2016 (USD Bn)

18-28

39-49

32-42

13-23

23-33

2012-2016 CAGR%

0-3

0-3

(2)-1

(4)-(1)

0-3

EMERGING MARKETSThe emerging markets are likely to double their pharmaceutical spending from US$ 151 Billion 2011 to around US$ 285-313 Billion by 2015 (Source: CLSA, 2013).Growth will be led by gradual economic growth and government efforts to expand healthcare access. IMS expects the emerging markets to grow by 13%-plus CAGR from 2011 to 2016, reaching US$ 357 Billion by 2016.



25

GENERIC MARKETThe global generic spending is projected to increase to USD 400-430 Billion by 2016 from USD 242 Billion in 2011, primarily driven by emerging markets. In 2012, over 490 ANDA received approvals globally (Source: USFDA)Growing generic spending in the developed markets over the next five years will be fuelled by generic competition due to patent expiries, with some additional increased due to expanded generic use for off-patent molecules. In emerging markets generic companies will increase most of the spending.

Generics Spending to Drive the Growth

The “patent cliff” has historically been an oral drug phenomenon but now with more than USD 100 Bn of patent expiries expected by 2016 including more than 172 small Injectable molecules with a cumulative markets size estimated at USD 20 Bn facing patent expiry by 2020 the generic Injectable industry is posed well to take advantage of the patent cliff.

35

30

25

20

15

10

5

02012 2013 2014 2015 2016

Mkt Size (USD Bn) No. of Product

GDUFA TO EASE THE US ANDA BACKLOGGeneric Drug User Fee Act (GDUFA) implemented in 2012 allows the FDA to collect user fee to establish systems and hire personnel to enhance efficiency in terms of review, inspection and related areas. With an Abbreviated New Drug Application (ANDA) backlog of more than 2500 drugs, the implementation of GDUFA will accelerate the process. Industry estimates 90% of the backlog to be address by 2017 and post 2017 the FDA targets to review a ANDA application within 10 months of application from the existing time frame of 24 to 36 months.

2011Global Spend

Branded Generic Other 2016 (E) Global Spend

956

34

173

27 1190



26

Top 5 therapy areas account for 60% of shortage in 2011

US Drug Shortage – An opportunity for Injectable GenericsDrug shortages in the US present a niche opportunity for generic companies, particularly in the injectables space. Approximately 80% of drug shortages in the US pertain to generic injectables drugs (roughly half of the injectables market) and approximately 60% of the shortage falls in the therapy areas of oncology, cardiovascular (CVS), central nervous system (CNS), anti-infectives and pain management out of these 50% shortages were introduced before 2000.

While there has been some respite recently, drug shortage instances have shot up over the past few years, following the Heparin incident in 2008. Post the implementation of an executive order from the Obama administration and the FDASIA Act, there has been an overall improvement in the drug shortage scenario in the US (117 drug shortages in in 2012 versus 251 in 2011). However, any resolution presents an opportunity for companies in the sterile injectables space.

Drug Shortages – Dominated by Injectables

Cy05 Cy06 Cy07 Cy08 Cy09 Cy10 Cy11 Cy12

Injectable Other

30

31 23

33 50

40

72

38

85

72

46

132

68

183

33

84

Vitamins, 9%

Others, 28%

Oncology, 16%

Anti-Infective, 15%

CVS, 12%

CNS, 11%

pain, 9%


Management Discussion & AnalysisLimited Supplier fuel drug shortages in the US

27

60

50

40

30

20

10

0

0 1 2 3 4 5 6 7 8 9 10 12 17

7

23 2319

15

610

3 1 2 1

Num

ber

of P

rodu

cts

Number of Suppliers

56

2

Increased Warning Letters by FDA further reduces the number of Suppliers

6000

5000

4000

3000

2000

1000

0Cy04 Cy05 Cy06 Cy07 Cy08 Cy09 Cy10 Cy11 Cy12

New FDA Commissioner

Warning Letters by USFDA

Injectable takes the Lead in US Drug shortage ListInjectable due to its complex manufacturing process and stringent quality norms has limited suppliers with the top three players commanding nearly two thirds of the market share; most Injectable drugs have limited number of competitors with 83% of the drugs having less than five players. Add to this a differentiated distribution network through GPOs leads to an opportunity for the existing Injectable players who have USFDA approved facilities.

Injectable – A High Margin BusinessComplexity of manufacturing has led to limited competition across a large range of products with approximately 83% of injectable drugs sold in the US have less than five generic competition, fewer competitors and stringent regulator action have resulted in severe drug shortages in the US. These shortages are dominated by sterile injectables, presenting niche opportunities. Indian companies have seen strong success in the US generics market, as large value and volume drugs go off patent. However, these opportunities were restricted in the oral solid (capsules and tablets) dosage forms. With patent expiries expected to dry up by 2016, companies need to look beyond the traditional oral solid route. Injectables emerge as a key segment, with limited competition and substantial opportunity.

Indian EconomyIndia’s GDP is estimated to have grown by 5% in FY 2012-13. The Reserve Bank of India infused INR 18,000 crore to its economy by reducing the cash reserve ratio (CRR) to 4% in its third monetary policy during 2012-13. Moreover, the Reserve Bank of India twice lowered the repo rate by 25 basis points in 2012-13 to help revive growth. Increasing FDI limits across major sectors have significantly improved India's capital flows. The government is also taking various initiatives to keep the fiscal reforms as expected to strengthen Indian's growth story.


Management Discussion & AnalysisIndian Pharmaceutical MarketThe Indian Pharma Industry grew a healthy 16% in FY13 to reach $ 38 Billion against a size of $ 33 Billion in FY12. This growth was largely export-driven, supported by the domestic industry which grew by 12% this fiscal. The growth in the domestic market has been led by the chronic segments which grew by 14% YoY and today account for 30% of the total market.

28

Domestic Exports

Fy12 Fy13 Fy15(E)

13

8

14

11

15

17

Source: AIOCD MAT March 2013; Directorate General of Foreign Trade; Pharmaexcil India; CII- Yes Bank, India Life Sciences: Vision 2015

The growth of the domestic pharma market has decelerated over the last few quarters owing to a number of systemic bottlenecks. The current policy paralysis with regards to the new drug pricing mechanism, delays in approval of clinical trials, aggressive patent activism and the evolving marketing guidelines have led to a wait and watch approach being implemented by most pharma players. In addition macro-economic pressures of high inflation and lower disposable income in the hands of payers has led to the current economic slowdown extending to the pharma space as well.

Quarterly Growth run rate of Domestic Indian Pharmaceutical Market

Q1FY11 Q1FY11 Q1FY11 Q1FY11 Q1FY11 Q1FY11 Q1FY11 Q1FY11 Q1FY11 Q1FY11 Q1FY11 Q1FY11 Q1FY11 Q1FY11 Q1FY11

11%

17%

14% 14% 14% 14% 14%

17%18%

16%

17%

14%

9%

8%

12%

The growth in the domestic market is therefore expected to remain muted till the current bottlenecks are eased. There are some signs of recovery at the policy level with clarity emerging from the National Pharmaceutical Pricing Authority on the latest Essential Medicine List and fresh regulations being put in place to better manage clinical trials. However, it is still a long way to go before the policy measures bear fruit and the domestic growth can sustainably resume. The 2013 sectorial update by Fitch reiterates a stable outlook for the domestic Pharma market as the inherent growth drivers are still in place, despite the delta emerging from the current regulatory ambiguity.

2014 M&A OUTLOOKA recent survey by KPMG indicated 41% of the respondents felt that Mergers and Acquisitions would be most active in Healthcare, Pharamaceuticals and Life Sciences, this was second only to the TMT sector where 44% respondents felt would be the most active sector in M&A. Futher, more than 83% respondents felt that the US would be the most popular deal destination as large pharma companies seek out companies to enhance product basket & delivery systems, enter new revenue growth areas, expand customer base or seek cost efficiencies in regions where there is a distinct cost advantage as compared to US.

Larger corporations and PE funds are sitting on investable capital and feel positive about the current deal environment. Interest rates in the US are low and the economy is improving. Despite these positive factors the M&A has not been as active as expected in 2013. However deals are expected to pick up as companies seek to grow inorganically in 2014.


RevenueRevenue from operations

(a) Gross Sales 66,791 77,623Less : Excise Duty 954 1,351 Net Sales 65,837 76,272

(b) Operating income 939 464 Revenue from operations (net) 66,776 76,736

Other Income 4,059 1,029 Total Revenue 70,835 77,765 Expenses

Cost of materials consumed 15,091 21,780Purchase of Stock in trade 9,096 4,686

Changes in inventories of finished goods and work in-progress 519 (1,418)Employees benefits expense 5,098 5,236 Finance cost 5,219 6,505 Depreciation and amortization expense 6,535 7,427 Other expenses 20,035 19,972

Total expenses 61,593 64,188 Profit before exceptional items and tax 9,242 13,577 Exceptional Items : Profit on disposal of infusion business under slump sale 1,506 -Profit Before Tax 10,748 13,577Total Tax Expense 2,208 3,187 Profit After Tax and before share of Profit/(loss) of Associate 8,540 10,390 Share in Loss of Associate (100) -Profit for the year 8,440 10,390

for the Year ended on31-12-2013

for the Year ended on31-12-2012

(Rupees in Lacs)

Management Discussion & AnalysisJoint Venture with Claris Otsuka LimitedOn December 7, 2012, Company entered in to certain agreements with Otsuka Pharmaceutical Factory, Inc., Japan (‘Otsuka’) and Mitsui & Co. Ltd., Japan (‘Mitsui’) for transfer of its Infusion Business to Claris Otsuka Limited on ‘slump sale’ basis. The said infusion business includes identified products of Common Solutions, Anti Infective, Plasma Volume Expanders and Parenteral Nutrition in India and in Emerging markets.

The transaction was completed on July 31, 2013 ,and company received Rs 1050 Cr towards the transfer of business , after completion of all the formalities and approvals.

Rewards to ShareholdersAfter entering into Joint Venture with Otsuka & Mitsui , company rewarded its shareholders by offering buy-back and declaration of Interim Dividend. Company vide its board meeting held on January 7, 2014 approved an interim dividend of Rs 9 per equity share. In the same meeting the Board , subject to the approval of shareholders by way of a Special Resolution through postal ballot and other regulatory compliances required under applicable laws, recommended a proposal to buy back, on a proportionate basis, from the shareholders/beneficial owners of the equity shares of the Company as on the record date, up to 92,50,000 equity shares of the face value of Rs. 10 each (representing 14.49 % of the total equity share capital of the Company) at the price of Rs. 250 per equity share aggregating to Rs. 231.25 Crs through “Tender Offer” route as prescribed under the Securities and Exchange Board of India (Buy-Back of Securities) Regulations, 1998.

Financial PerformanceThe financial statements have been prepared in compliance with the requirements of the Companies Act, 1956 and Generally Accepted Accounting Principles (GAAP) in India. The revised Schedule VI of the Companies Act, 1956 has been adopted while preparing these statements, in accordance with the notification from the Ministry of Corporate Affairs.

During the period from Jan 1, 2013 to July 31, 2013 , company operated in both Infusion & Specialty business , and subsequent to Joint Venture , it operated in specialty business only , thus current year financials are not comparable to the previous year.

The following table details out the statement of profit and loss for the year ended December 31, 2013 and December 31, 2012.



On consolidated basis, the net sales of the company for the year ended December 31, 2013 stood at Rs. 65,837 Lacs as against Rs. 76,272 Lacs in the previous year. Company would like to state that two numbers are not comparable due to Joint Venture in 2013.

Operating Income

The operating income has increased by 102.14 %, from Rs. 464 Lacs in the previous year to Rs. 939 Lacs. The primary reason for the increase in the operating income is attributed to additional income of Rs. 448 lacs generated by rendering services to the Joint Venture Company for the period from August, 2013 to December, 2013.

Other Income

The other income has increased by Rs.3,029 lacs, which is approximately 300% times of the income booked in the previous year. The Other Income stood at Rs 4,059 Lacs in the current year as compared to Rs 1,029 Lacs in the previous year. Other income for current year includes an investment income of Rs 3,175 lacs arising out of the proceeds from Joint Venture.

Finance Costs

Finance costs reduced by 19.77% from Rs. 6,505 Lacs in FY 2012 to Rs. 5,219 Lacs in FY 2013, due to repayment of loan funds during the year.

Depreciation and Amortization Expense

Depreciation and Amortization Expense reduced by 12% from Rs. 7,427 Lacs in FY 2012 to Rs. 6,535 Lacs in FY 2013, on account of transfer of fixed assets pursuant to slump sale of infusion business.

30

Revenue Break Up

Company’s total Income for the year ended December 31, 2013 comprises of three elements:• Revenue from Operations• Operating Income• Other Income

The table below illustrates the contribution of each of these components to the company’s total income for FY 2013 and FY 2012:

Revenue from OperationsOperating IncomeOther IncomeTotal Revenues (100%)

FY 2013

92.9%1.3%5.7%

70,835

FY 2012

98.1%0.6%1.3%

77,766

(Rupees in Lacs)

Material Costs 34% 33%

Employee Costs 7% 7%

Operating expenses 28% 26%

Interest 7% 9%

Depreciation 9% 10%

Tax 3% 4%

PAT 14% 14%

33%

7%

26%

9%

10%

4%

14%

34%

7%

28%

7%

9%

3%

14%

Distribution on Revenue FY13 Distribution on Revenue FY12

Fy12Fy13



31

Debt Equity Ratio

2013

2012

2011 0.39

0.47

0.19

Current Ratio

2013

2012

2011 3.21

2.45

2.35

Net Worth (Rs. in Lacs)

2013

2012

2011 105,211

114,887

140,429

Risk and Concerns

The Company is exposed to certain risks such as Regulatory changes, credit and liquidity risks, New Product risks, competition , Government pricing controls, litigation relating to Intellectual Property Rights and products quality, foreign exchange fluctuation, economic and political environment etc. The Company has a Corporate Risk Management team consisting of professionally qualified chartered accountants and functional specialists who are empowered to examine/audit the adequacy, relevance and effectiveness of the control systems, compliance with policies , plans , and statutory requirements and to take the necessary steps for mitigating risks profile of the company.

Internal Control system and their adequacy

The company has a reasonable system of internal control comprising authority levels and powers , supervision, check and balances, policies and procedures. It has in place adequate stytems of internal control, commensurate with its size and the nature of operations. The system is reviewed and updates on a ongoing basis. The company has well defined internal audit system which is continuously upgraded by measures such as strengthening of IT enabled activities and use of external management services.

Exceptional Item

Exceptional item comprise of profit of Rs 1,506 lacs from the sale of infusion business on slump sale basis

Profit for the year

Profit for the year stood at Rs 8,441 lacs after the share of loss in the Associate company which amounted to Rs 100 lacs

Financial Highlights

*Based on GAAP Consolidated Financial Statements



32

Corporate Social Responsibility

As a socially responsible organisation, Claris supports many initiatives impacting society at large, in various ways of promoting and contributing to activities of sports, education, culture, etc.

Supporting Sports for a Cause

Claris has a strong belief that sports play a very important role in the development of youth and society. Hence, your company encourages and sponsors sporting events to reinforce the sports culture in today's youth.

For the second year in a row, Claris joined hands with The Times of India (TOI) and Ahmedabad District Football Association to organize 'TOI-Claris Twenty20 School Soccer Tournament'. The tournament witnessed participation from boys and girls of prominent schools of Gujarat which compiled into 48 teams. This year, girls' teams were an addition to the last year's all-boys format in the spirit of campaign “Save The Girl Child”. The purpose of organising this tournament was fulfilled where extensive participation from the youth of the entire state was given an opportunity to showcase their football skills and they were given a chance to display their love for football.

Your company supported an inaugural cylcing event, Brevet de Randonneur Mondieux (BRM) in Ahmedabad. (BRM is an international Endurance Cycling event, held in over 30 countries, and is the oldest event in the history of Cycling). The event was organised by ‘Cyclone’, a Cycling Club in Ahmedabad and was authorised by Audax India Randonneurs, where about 70 riders from across Gujarat participated in various categories, including Claris members.

Extending Help to Students

Every Independence Day celebration is fulfilled with a feeling of sharing through a charity program for Claris. This year too, your company distributed exam kit, lunch-box set, and chocolates to the students of a school of Chancharwadi village near the manufacturing facility on the occasion of Independence Day. Various members visited the school where they delivered speech to the students on being a responsible citizen for nation’s growth. The elders, villagers, and sarpanch appreciated our contribution towards the noble cause.

Motif Charity Walk

Motif organised a Charity Walk in Ahmedabad to benefit certain NGOs of the state working for social causes. This year too, your company was one of the associate sponsors for the campaign, where some of the Claris members participated in the walk.Supporting AJTET for Traffic Regulation

Looking at the current state of traffic in the city, Ahmedabad Jilla Traffic Education Trust (AJTET) initiated a cause to support police in controlling & managing traffic, creating awareness among public about the traffic rules, and bringing about a culture of order & road discipline. Your company supported the cause by contributing funds and participating in their initiatives. Claris was appreciated for supporting such a noble cause.

Water Festival at Adalaj ni Vav

Encouraging the music fraternity and attempting to reintroduce the heritage monuments in the city, Craft of Art hosted music festivals, keeping in sync with the World Heritage Week 2013. Your company sponsored the Water Festival at heritage site Adalaj ni Vav, which witnessed renowned musicians performing and thousands of music & art connoisseurs encouraging the moments.

Your company also supports Poiesis Achievement Foundation - a unique initiative with the vision to inspire young children towards a life of accomplishment and help them grow into powerful and determined achievers, and Indian Renal Foundation (IRF), a voluntary health organization dedicated to the cause of kidney failure patients in India in its mission of prevention, treatment, education, and research in the area of kidney diseases.

Your company won 1st rank in 'Healthcare' for the 4th time in a row, and achieved 15th rank in 'Top 100 Best Companies to Work for in India' in study conducted by The Economic Times and Great Place To Work Institute, India in 2013.

The study measured the level of trust, pride, and companionship within organisations. This achievement is a testimonial of your company's robust organisational philosophy, values, and culture practices, which were assessed and recognised in the study.

Hiring

Your company continued to use the non-traditional ways of sourcing and recruitment like posting vacancies on professional networking sites like LinkedIn, job portals, interviewing outstation candidates online on Skype, along with the traditional ways of member referral program ‘AutoQuest’, internal databank, and advertisements.

For assessing soft skills of candidates during hiring, your company continued to conduct various tests - aptitude tests, psychometric tests, handwriting analysis, etc.

Capability Enhancement



33

As part of human capital development, your company continued to focus on managerial and leadership development programs. This year, Competency-based people development framework was introduced. Various training programs were organized in line with training needs identified after thorough competency mapping. For key members, several psychometric tests were conducted like extended DISC and FIRO-B to assess and map the competency of the members, which were followed by a session with the faculty and one-to-one counseling with the experts.

Your company initiated providing product training to international locals which serves as a platform to solve their queries.

Outdoor learning programs were organised where members were made to perform various team building activities, along with a discussion with the faculty and senior members where they were asked of their learnings.

Throughout the year, besides in-house training by internal and external faculty, key members were nominated to premium management institutes including IIMs, ISBs and MDI for leadership skills development. Many members were encouraged to learn through webinars as well.

Cultural InitiativesYour company arranged for dental and eye check-ups for all members and displayed informative posters on good health practices.

Under the continued initiative ‘Thank God It’s Saturday’ (TGIS), where members can wear casual dress - T-shirt, Jeans and sport shoes on Saturdays, a Soccer Saturday was organised to promote the spirit of the game during our ongoing Soccer Tournament , which enhanced the flavour of the tournament.

Your company recognised the achievements made by the family members by displaying them in newsletter and on intranet portal, which incited the members to feel an integral part of the company as their loved ones were appreciated on a company level.

Your company also introduced an initiative 'Feel Special' for key members, where a cake is delivered on the member's marriage anniversary at their home. This provides a feeling of belongingness with the company by the member and their spouse.

Internal CommunicationKeeping the Claris members and their family abreast of the key developments in the company, your company continued sending Claris Quarterly newsletter every quarter during the year.

Employee Engagement & InvolvementThe members along with their families celebrated all major festivals of the year - Uttarayan, Holi, Janmashtami, Navratri, Dussehra, Diwali, and Christmas with great enthusiasm. Similarly, your company also celebrated special days like - New Year, Women’s Day, Mother’s Day, etc.

Several sports tournaments were conducted such as Cricket, Table Tennis, Carrom, Chess, Pool, etc. For the first time, a Soccer Tournament was also organised wherein members displayed a lot of exuberance.

The thrust of HR remained on bringing harmony among business goals, people capabilities, culture, and systems through various initiatives and interventions. As on December 31, 2013, the total employees of the organisation were 999.

Work-Life BalanceWe strive to create a work environment which not only builds professional career but also develop people in all work-life dimensions.

In today’s fast-paced life, people have to work more efficiently and maintain energy. Your company provides members with upto-date technologies to enhance work efficiency e.g. we have SAP-enables systems and processes, and that too linked with mobile applications, which help people take faster decisions even while they are away from office. We have energy boosters within our premises like Clarista, the cafeteria and Gaming Zone, an area to play indoor games that provide members a great deal of fun and rejuvenation to maintain their energy levels.

Members’ health is of course an important area for balancing life. Your company has an in-house gymnasium having all the latest equipment where members can go and work-out. On the wellness front, various health check-ups and tests are conducted throughout the year for members and families. We organize various sports competitions like soccer, cricket, pool, table tennis etc to enhance fitness and imbibe team spirit among people.

Your company allows time-off for personal work like paying utility bills, meeting social obligations, visiting banks etc. and also makes onsite arrangement for most of the needs to save on time of people. In order to encourage the members to spend leisure time with family your company provides paid leave whenever they wish. Besides long vacation, members can utilize ‘myHoliday’ a flexi-leave planning scheme whereby members can take leave on their own religious festivals as per their wish. On the front of involving families of members on larger scale, we organize and celebrate cultural festivals with them.

Your company sponsors members to musical and cultural events around the city like Times Ahmedabad Festival, dramas, ‘Saptak’ music festival, etc. Your company extends financial support as well to members on certain important occasions like marriage, purchasing home and car.

In all, your company attempts to strike balance between work and life of people by touching upon their needs in terms of health, spirituality, family involvement, leisure, work and time management, finances and overall personal development; and thereby attempts to keep people motivated and committed.



34

Cautionary Statement

Certain statements in the Management Discussion & Annalysis detailing the company’s objectives, projections, estimates, expectations or predictions may be forward looking statements within the meaning of applicable securities laws and regulations. These statements being based on certain assumptions and expectation of future event, actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Company’s operations include economic conditions affecting domestic demand supply conditions, finished goods prices, changes in Government Regulations and Tax regime etc. The Company assumes no responsibility to publically amend , modify or revise any forward looking statements on the basis of subsequent developments, information or events.


Report on the Financial StatementsWe have audited the accompanying financial statements of CLARIS LIFESCIENCES LIMITED (“the Company”), which comprise the Balance Sheet as at 31st December, 2013, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management’s Responsibility for the Financial StatementsThe Company’s Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards notified under the Companies Act, 1956 (“the Act”) (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs) and in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors’ ResponsibilityOur responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

OpinionIn our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:(a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st December, 2013;(b) in the case of the Statement of Profit and Loss, of the profit of the Company for the year ended on that date; and(c) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

Report on Other Legal and Regulatory Requirements1. As required by the Companies (Auditor’s Report) Order, 2003 (“the Order”) issued by the Central Government in terms of Section 227(4A) of the

Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order. 2. As required by Section 227(3) of the Act, we report that:

(a) We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with the Accounting Standards notified under the Act (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated 13 September, 2013 of the Ministry of Corporate Affairs).

(e) On the basis of the written representations received from the directors as on 31st December, 2013 taken on record by the Board of Directors, none of the directors is disqualified as on 31st December, 2013 from being appointed as a director in terms of Section 274(1)(g) of the Act.

Auditors’ Report To the Members of Claris Lifesciences Limited

For Deloitte Haskins & SellsChartered Accountants (Registration No. 117365W)

Gaurav J. ShahPartner(Membership No : 35701)

Place : AhmedabadDate : February, 201428th


1. Having regard to the nature of the Company’s business / activities, clauses (xiii) and (xiv) of CARO are not applicable.

2. In respect of its fixed assets : (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.(b) The Company has a program of verification of fixed assets to cover all the items over a period of three years which in our opinion, is reasonable

having regard to the size of the Company and the nature of its assets. Pursuant to the program, certain fixed assets were physically verified by the management during the year. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

(c) During the year, the Company has disposed off a substantial part of its fixed assets (attention is invited to note no. 37 of the financial statements). According to the information and explanations given to us, we are of the opinion that the sale of the said part of the fixed assets has not affected the going concern status of the Company.

3. In respect of its inventory : (a) According to the information and explanations given to us, inventories were physically verified during the year by the management at all

locations at reasonable intervals. In our opinion, the frequency of verification is reasonable. (b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by

the management were reasonable and adequate in relation to the size of the Company and the nature of its business.(c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories. As

explained to us, the discrepancies noticed on physical verification of inventories as compared to the book records have been properly dealt with in the books of account.

4. In our opinion and according to the information and explanations given to us, there are no companies, firms or parties required to be entered into the register maintained under section 301 of the Companies Act, 1956. Accordingly, paragraphs 4(iii) (a) to (g) of the Order are not applicable to the Company.

5. In our opinion and according to the information and explanations given to us, having regard to the explanations that some of the items purchased are of special nature and suitable alternative sources are not readily available for obtaining comparable quotations, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory and fixed assets and the sale of goods and services. During the course of our audit, we have not observed any major weakness in such internal control system.

6. In our opinion and according to the information and explanations given to us, there are no contracts or arrangements that need to be entered into the register maintained in pursuance of Section 301 of the Companies Act, 1956.

7. According to the information and explanations given to us, during the year, the Company has not accepted any deposits from public.

8. The Company has appointed a firm of Chartered Accountants for carrying out internal audit. On the basis of the reports made by them to the management, in our opinion, the internal audit system is commensurate with the size of the Company and the nature of its business.

9. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under Section 209(1)(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

10.According to the information and explanations given to us in respect of statutory dues :The Company has generally been regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, employees’ state insurance, income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other material statutory dues applicable to it.

No undisputed amounts payable in respect of the aforesaid statutory dues were outstanding, as at December 31, 2013 for a period of more than six months from the date they became payable.

11. Details of dues in respect of income tax, sales tax and excise duty which have not been deposited as at December 31, 2013 on account of disputes are given below :

Annexure to the Auditors' Report (Referred to in paragraph 1 under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even date)


Statute

Income Tax Act, 1961





Andhra Pradesh VAT Act, 2005

Central Excise Act, 1994



Period to which the amount relates

A.Y. 2006-07

A.Y. 2007-08

A.Y. 2008-09

A.Y. 2009-10

A.Y. 2010-11

2006 – 2010

2008 – 2009

2011-2012

2011-2012

Nature of Dues

Income Tax

Income Tax

Income Tax

Income Tax

Income Tax

Sales Tax

Excise Duty

Excise Duty

Excise Duty

Forum where Dispute is pending

Income Tax Appellate Tribunal



Commissioner of Income Tax (appeals)

Commissioner of Income Tax (appeals)

Sales Tax Appellate Tribunal

CESTAT, Ahmedabad

Deputy Commissioner, Central Excise

Deputy Commissioner, Central Excise

11. The Company does not have accumulated losses at the end of the financial year. The Company has not incurred cash losses during the financial year covered under the audit and during the immediately preceding financial year.

12.In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to financial institutions or banks. The Company has not issued any debentures.

13.In our opinion and according to the explanations given to us and based on the information available, no loans have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

14.In our opinion and according to the information and explanations given to us, during the year, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

15.In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained.

16.According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that no funds raised on short-term basis have been used for long-term investment.

17.During the year, the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

18.The Company has not issued any debentures during the year.

19.The Company has not raised any money by public issues during the year.

20.To the best of our knowledge and belief and according to the information and explanations given to us, no fraud by the Company or no material fraud on the Company was noticed or reported during the year.

For Deloitte Haskins & SellsChartered Accountants(Registration No. 117365W)



Annexure to the Auditors' Report

* Net of amounts paid under protest or otherwise

Amount involved (Rs. in lakhs*)

70.55

67.60

91.50

0.02

0.18

8.93

68.59

2.29

14.87


(Referred to in paragraph 1 under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even date)

For and on behalf of the Board of Directors


Kirit KanjariaVP - Company Secretary & Compliance Officer



Balance Sheetas at 31st December, 2013

In terms of our report attached

For Deloitte Haskins & SellsChartered Accountants

Gaurav J. ShahPartner


(Rupees in Lacs)

I. EQUITY AND LIABILITIES(1) Shareholders' funds

(a) Share Capital 2 6,381.78 6,381.78 (b) Reserves and Surplus 3 88,631.40 87,239.13

95,013.18 93,620.91

(2) Non - current liabilities(a) Long-term borrowings 4 12,682.94 29,894.66 (b) Deferred tax liabilities (net) 5 5,896.85 7,166.99 (c) Other long-term liabilities 6 - 133.53 (d) Long-term provisions 7 591.12 881.25

19,170.91 38,076.43

(3) Current liabilities(a) Short-term borrowings 4 10,546.65 20,037.67 (b) Trade payables 8 10,317.21 10,045.21 (c) Other current liabilities 6 29,282.17 16,684.10 (d) Short-term provisions 7 9,009.93 1,965.79

59,155.96 48,732.77

Total 173,340.05 180,430.11

II. ASSETS(1) Non - current assets

(a) Fixed assets 9(i) Tangible assets 50,316.23 80,473.99 (ii) Intangible assets 196.50 - (iii) Capital work-in-progress 17,329.26 17,426.79

67,841.99 97,900.78 (b) Non - current investments 10 1,860.62 1,665.62 (c) Long-term loans and advances 11 9,510.19 19,904.22 (d) Other non-current assets 12 - 126.00

79,212.80 119,596.62

(2) Current assets(a) Current investments 10 60,881.99 - (b) Inventories 13 3,925.32 17,194.80 (c) Trade receivables 14 15,479.09 24,793.54 (d) Cash and cash equivalents 15 8,912.85 11,334.39 (e) Short -term loans and advances 11 3,764.70 7,341.56 (f) Other current assets 12 1,163.30 169.20

94,127.25 60,833.49

Total 173,340.05 180,430.11 Significant Accounting Policies 1Other Notes forming part of the Financial Statements 2-45

As at31-12-2013

As at31-12-2012Notes


(Rupees in Lacs)

NoteFor the Year ended on

31-12-2013

Statement of Profit & LossFor the year ended on 31st December, 2013

For the Year ended on 31-12-2012

RevenueI. Revenue from operations 16

(a) Gross Sales 63,833.23 72,685.39 Less : Excise Duty 953.88 1,348.37 Net Sales 62,879.35 71,337.02

(b) Operating income 938.65 464.36 Revenue from operations (net) 63,818.00 71,801.38

II. Other Income 17 4,049.53 1,213.15 III. Total Revenue ( I+ II ) 67,867.53 73,014.53 IV. Expenses

Cost of materials consumed 18 15,091.00 21,780.21Purchase of Stock in trade 18 9,378.23 4,242.88Changes in inventories of finished goods and work-in-progress 19 (142.73) (1,869.83)Employees benefits expense 20 4,724.87 4,922.81 Finance cost 21 5,210.12 6,491.24 Depreciation and amortization expense 5,796.11 7,179.44 Other expenses 22 18,995.05 19,594.79 Total expenses 59,052.65 62,341.54

V. Profit before exceptional items and tax (III- IV) 8,814.88 10,672.99 VI. Exceptional items

(a) Profit on disposal of infusion business (Discontinuing Operations) under slump sale 37 1,505.98 - (b) Diminution in value of investment in a subsidiary 25 - (45.10)

VII. Profit before tax (V+VI) 10,320.86 10,627.89 VIII. Tax Expense

(a) Current Tax 4,102.46 2,067.72(b) Deferred Tax (1,270.14) 1,142.55(c) MAT Credit Entitlement (633.31) - (d) Short / (Excess) Provision of Tax of Earlier Years - (24.00)

2,199.01 3,186.27 IX. Profit After Tax (VII-VIII) 8,121.85 7,441.62 Profit after tax comprises of:

a. Profit from Continuing Operations (after tax) 3,921.33 * b. Profit from Discontinuing Operations (before tax) 37 2,958.62 * c. Profit on disposal of infusion business under slump sale 1,505.98 * d. (Add) / Less: Tax expense / (Reversal) of discontinuing operations;

i) Tax expense of Discontinuing Operations 884.52 *ii) Tax on disposal of infusion business under slump sale (net of reversal of deferred taxes of Rs. 2,885.18 Lacs) (620.44) *

X. Earnings per share (Basic & Diluted) 36(Nominal value per equity share of Rs. 10)a. Continuing Operations 6.14 *b. Total Operations 12.73 11.66

* Refer Note 37 ( c )Significant Accounting Policies 1Other Notes forming part of the Financial Statements 2-45





Chandra gh S. PurohitWhole Time Director

sin






(Rupees in Lacs)

Cash Flow StatementFor the year ended on 31st December, 2013



A. Cash Flow From Operating Activities

1. Profit before tax 10,320.86 10,627.89

2. Adjustments for :Depreciation and amortisation expense 5,796.11 7,179.44 Finance cost 5,210.12 6,491.24 Interest income (3,272.54) (680.50)(Profit)/Loss on sale of fixed assets - (Net) - (1.11)Provision for diminution in value of long term investment - 45.10 Provision for doubtful debts and advances 20.19 133.62 Bad debts written-off - 73.65 Gain on sale of Units of Mutual Funds (519.87) - Profit on disposal of infusion business under slump sale (1,505.98) - Unrealised foreign exchange rate difference (gain)/loss (Net) (400.92) (1,374.50)

Operating profit before working capital changes (1+2) 15,647.97 22,494.83

3. Adjustments for :Decrease / (increase) in trade and other receivables (3,030.85) 3,878.78 Decrease / (increase) in inventories (107.79) (1,984.04)(Decrease) / increase in trade and other payables 1,350.17 2,863.22

Cash generated from/(used in) operations 13,859.50 27,252.79

4. Direct taxes paid (1,663.52) (2,477.87)

Net Cash Generated From/(Used in) Operating Activities [A] 12,195.98 24,774.92

B. Cash Flow From Investing ActivitiesPurchase of fixed assets (Including Capital Advances) (26,306.77) (34,748.01)Proceeds from Sale of fixed assets 1,267.65 13.11 Proceeds from disposal of infusion business under slump sale 105,040.00 - Purchase of Current Investments (60,881.99) - Investment in Subsidiary Company - (5.00)Investment in Associate Company (195.00) - Interest received 2,278.44 641.92 Gain on sale of Units of Mutual Funds 519.87 -

Net Cash Generated/(Used in) Investing Activities [B] 21,722.20 (34,097.98)

C. Cash Flow From Financing ActivitiesProceeds from long term borrowings (Net) (17,940.23) 11,528.00 Proceeds from short term borrowings (Net) (9,491.02) 1,088.49 Interest paid (5,570.74) (6,227.82)Dividend paid (1,276.35) (1,276.35)Net Cash Generated From/(Used in) Financing Activities [C] (34,278.34) 5,112.32

Net Increase/(Decrease) In Cash & Cash Equivalents [A+B+C] (360.16) (4,210.74)Cash & Cash Equivalents at the beginning of the Year 7,193.11 11,403.85 Cash & Cash Equivalents at the end of the Year 6,832.95 7,193.11


(Rupees in Lacs)

Cash Flow StatementFor the year ended on 31st December, 2013



Notes:

1 A) Components of Cash & Cash EquivalentsCash on hand 3.12 6.96 Cheques on hand - 84.00 Balances with banks

- In Current accounts 6,039.07 2,709.17 - In Margin money 665.76 392.98 - In Fixed deposit account 125.00 4,000.00

6,832.95 7,193.11 B) Cash and cash equivalents not available for immediate usea) In Margin money and fixed deposit accounts 2,076.95 4,139.18 b) Unclaimed share application money lying in escrow account 0.18 0.18 c) Unclaimed dividend account 2.77 1.92

2,079.90 4,141.28 Cash & Cash Equivalents as per Note 15 (A+B) 8,912.85 11,334.39

2 Interest paid is exclusive of and purchase of fixed assets is inclusive of interest capitalised 780.58 788.49

3 The above cash flow statement has been prepared under the "Indirect Method" as set out in the Accounting Standard - 3 on Cash Flow Statement issued by the Institute of Chartered Accountants of India.

4 Cash Flow Statement reflects the combined cashflows pertaining to continuing and discontinuing operations.

5 The previous year's figures have been regrouped wherever necessary.





Chandra gh S. PurohitWhole Time Director

sin






Notes forming part of the Financial Statements

1. SIGNIFICANT ACCOUNTING POLICIES:

1.1 Basis of preparation of financial statements The financial statements are prepared under the historical cost convention on accrual basis of accounting, in accordance with the requirements of the Companies Act, 1956, including the accounting standards notified by the Central Government of India under Section 211 (3C) of the Companies Act, 1956.

1.2 Use of estimatesThe preparation of financial statements, in conformity with the generally accepted accounting principles requires that the management makes estimates and assumptions that affect the reported amount of assets and liabilities, disclosure of contingent liabilities as at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. Difference between the actual results and estimates are recognized in the period in which the results are known / materialized.

1.3 Fixed assets and depreciationa. Fixed assets are capitalized at cost including all direct costs and other expenses incurred in connection with acquisition of assets and are net

of refundable taxes and levies.b. Depreciation on Fixed Assets is provided on the straight-line method at the rates and in the manner prescribed under Schedule XIV of the

Companies Act, 1956 or at the rates based on estimated useful life whichever is higher. c. Leasehold improvements are amortized over a period of 36 months. d. Intangible assets are stated at cost and are amortized equally over a period of five years from the year in which incurred.

1.4 Investmentsa. Long-term investments are stated at cost. Any diminution in the value, other than temporary, is provided for. Current investments are carried

individually, at lower of cost and fair value.b. Investments in shares of foreign subsidiary companies are expressed in Indian Currency at the rate of exchange prevailing at the time when

the original investments were made.

1.5 InventoriesInventories are valued at lower of cost and net realisable value. Cost of inventories comprises all cost of purchase, cost of conversion and other costs incurred in bringing the inventories to their present location and condition. Cost of raw materials and packing materials is computed on Weighted Average basis. Cost of work-in-progress and finished goods is determined on absorption costing method.

1.6 Revenue recognitiona. Sales include sales of products, dossiers and marketing rights. Sales include excise duty and exchange differences on sales transactions, but

are net of sales tax. Sales are recognized at the time when significant risks and reward of ownership in the goods are transferred.b. Revenue in respect of other income is recognized when no significant uncertainty as to its determination or realization exists.

1.7 Retirement benefitsDefined Contribution PlanThe Company's contributions paid/payable for the year to Provident Fund and ESIC are charged to the profit and loss account for the year.

Defined Benefit Plan The Company's liabilities towards gratuity and leave encashment are determined using the projected unit credit method which considers each period of service as giving rise to an additional unit of benefit entitlement and measures each unit separately to build up the final obligation. Past services are recognised on a straight-line basis over the average period until the amended benefits become vested. Actuarial gain and losses are recognised immediately in the profit and loss account as income or expense. Obligation is measured at the present value of estimated future cash flows using a discounted rate that is determined by reference to market yields at the balance sheet date on Government bonds where the currency and terms of the Government bonds are consistent with the currency and estimated terms of the defined benefit obligation.

1.8 Foreign currency transactionsTransactions denominated in foreign currencies are recorded at the exchange rate prevailing at the time of the transaction.

Monetary items denominated in foreign currencies at the year-end are restated at the year-end rates. In case of items, which are covered by forward exchange contracts, the difference between the year end rate and the rate on the date of contract is recognised as exchange difference and the premium paid on forward contracts is recognised over the life of the contract.

Non-monetary foreign currency items are carried at cost.

Any income or expense on account of exchange difference either on settlement or on translation is recognized in the profit and loss account, except, for the exchange differences arising on settlement or on translation of long-term foreign currency monetary items after 1st April 2011, so far as they relate to the acquisition of a depreciable capital asset, are added to or deducted from the cost of the asset and are depreciated over the balance life of the asset.


1.9 Research and development expensesRevenue expenditure on Research and Development is expensed as incurred. Expenses of capital nature are capitalized and depreciation is provided thereon as per the policy stated above.

1.10 Expenditure on product registrationExpenditure incurred for registration of products for overseas markets and for product acquisitions are charged to the profit & loss account.

1.11 Borrowing costsBorrowing costs consist of interest and other costs that the Company incurs in connection with the borrowing of funds and exchange differences arising from foreign currency borrowing to the extent that they are regarded as an adjustment to interest costs.

Borrowing costs that are attributable to acquisition / construction of qualifying assets are capitalized as part of cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to the profit & loss account.

1.12 LeasesLease rentals in respect of assets taken on operating leases are charged to the profit and loss account on accrual and straight-line basis over the lease term.

1.13 Taxes on incomeCurrent taxationCurrent tax provision is determined on the basis of taxable income computed as per the provisions of the Income Tax Act.Minimum Alternate Tax (MAT) paid in accordance with the tax laws, which gives future economic benefits in the form of adjustment to future income tax liability, is considered as an asset if there is convincing evidence that the Company will pay normal income tax. Accordingly, MAT is recognised as an asset in the Balance Sheet when it is probable that future economic benefit associated with it will flow to the Company.

Deferred taxationDeferred tax is recognized for all timing differences that are capable of reversal in one or more subsequent periods, subject to consideration of prudence and by applying tax rates that have been enacted or substantively enacted as on the balance sheet date.

1.14 Provisions, contingent liabilities and contingent assetsProvisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognized but are disclosed in the notes to the financial statements. Contingent assets are neither recognized nor disclosed in the financial statements.



(Rupees in Lacs)


As at31-12-2013

As at31-12-2012

2. SHARE CAPITAL

Authorised 120,510,000 Equity Shares of Rs.10 each 12,051.00 12,051.00

Issued, Subscribed, & Paid up :63,817,765 Equity Shares of Rs. 10 each fully paid - up 6,381.78 6,381.78

6,381.78 6,381.78

(I) Reconciliation of number of equity shares outstanding at the beginning and at the end of the reporting year :As at beginning of the year Nos. 63,817,765 63,817,765 Issued during the year Nos. - - Outstanding at the end of the year Nos. 63,817,765 63,817,765

(ii) Rights, Preferences and Restrictions attached to equity shares The Company has only one class of equity shares having a face value of Rs.10 per share. Each shareholder is eligible for one vote per equity share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders at the ensuing Annual General Meeting. In the event of liquidation, the equity shareholders are eligibleto receive the remaining assets of the Company after distribution of all the preferential amounts, in the proportion of their shareholding.

(iii) Shareholders holding more than 5% of total equity sharesAthanas Enterprise Private Limited Nos. 31,580,679 -

% 49.49 -

First Carlyle Ventures III Nos. 7,111,095 7,111,095 % 11.14 11.14

Abellon Energy Limited Nos. 6,844,532 - % 10.73 -

Sarjan Financial Private Limited Nos. - 23,780,172 % - 37.26

Arjun Handa Nos. - 7,800,507 % - 12.22

Aditya S. Handa Nos. - 3,371,532 % - 5.28

Medical Technologies Limited Nos. - 4,653,120 % - 7.29

(iv) Details of bonus shares issued during last five yearsEquity shares allotted as fully paid-up shares of Rs.10 each for a consideration other than cash pursuant to capitalization of securities premium account during the financial year ended December 31, 2010 Nos. 17,061,763 17,061,763

(v) The Board of Directors at their meeting held on 7th January, 2014 have, subject to the approval of shareholders by way of a Special Resolution through postal ballot and other regulatory compliances required under applicable laws, recommended a proposal to buy back, on a proportionate basis, from the shareholders/beneficial owners of the equity shares of the Company as on the record date, up to 92,50,000 equity shares of the face value of Rs. 10 each (representing 14.49 % of the total equity share capital of the Company) at the price of Rs. 250 per equity share aggregating to Rs. 23,125 Lacs which is less than 25% of the aggregate of equity share capital and free reserves of the Company as per audited financial statements of the Company for the financial year ended December 31, 2012 through “Tender Offer” route as prescribed under the Securities and Exchange Board of India (Buy-Back of Securities) Regulations, 1998.

Notes


(Rupees in Lacs)


As at31-12-2013

As at31-12-2012

3. RESERVES & SURPLUS

Capital Redemption Reserve 500.00 500.00 Securities Premium Account 34,584.62 34,584.62 General Reserve

Opening Balance 5,268.94 4,703.94 Add : Transferred from surplus in the Statement of Profit and Loss 830.00 565.00 Closing Balance 6,098.94 5,268.94

Surplus / (Deficit) in the Statement of Profit and LossOpening Balance 46,885.57 41,492.36Add : Net Profit for the year 8,121.85 7,441.62Less : Appropriations

Proposed Interim Dividend [Rs.9 per share (Previous Year : Nil)] 5,743.60 - Proposed Dividend [Nil (Previous Year : Rs.2 per share)] - 1,276.35 Tax on Dividend 976.12 207.06 Tax on Dividend of earlier year 9.86 - Transferred To General Reserve 830.00 565.00

Closing balance 47,447.84 46,885.57

88,631.40 87,239.13

4. BORROWINGS

Secured : -Long-term borrowings, non-current portionTerm Loans from Banks

External Commercial Borrowing-in Foreign Currency - 19,173.00 Rupee term loans 4.a 11,379.97 9,282.15 Vehicle loans 4.d 6.87 22.38

Term loans from Finance Companies Rupee term loan 4.c 1,293.91 1,410.00 Vehicle loan 4.d 2.19 7.13

12,682.94 29,894.66

Long-term borrowings, current portionTerm Loans from Banks

Rupee term loans 4.a 3,406.04 4,147.55 Vehicle loans 4.d 17.64 32.16

Term loans from Finance Companies Rupee term loan 4.c 120.00 90.00 Vehicle loan 4.d 4.94 7.41

3,548.62 4,277.12

Short-term borrowingsCash Credit accounts 4.b 8,305.87 18,054.63 Buyers' Credit 4.b 2,240.78 1,983.04

10,546.65 20,037.67 26,778.21 54,209.45

Notes :a. Term Loans are secured by first pari passu charge by hypothecation of specified moveable

fixed assets, mortgage over immovable fixed assets and second pari passu charge over stocks, receivables and specified immovable properties in favor of the Banks.

b. Cash Credit Accounts and buyers' credit are secured by first pari passu charge by hypothecation of all current assets of the Company (present and future); second pari passu charge by hypothecation of movable fixed assets (present and future), by mortgage on specified immovable fixed assets of the Company (present and future) and by first pari passu charge through equitable mortgage on specified immovable property of the Company.

c. The term loan is secured by first and exclusive charge over the immovable and movable assets of Solar Plant located at Modasa.

d. Vehicle loans from banks and finance companies are secured by hypothecation of respective vehicles.

Notes


(Rupees in Lacs)


As at31-12-2013

As at31-12-2012

5. DEFERRED TAX LIABILITIES

Deferred tax liabilitiesDifference between book depreciation and depreciation under the Income-tax Act ,1961 (IT Act) 6,455.39 7,917.97 Deferred tax assetsDisallowances of provisions / expenses 388.26 432.27 Share issue expenses set off against share premium 170.28 318.71 allowable u/s 35 - D of IT Act in subsequent years

558.54 750.98 Net Deferred Tax Liability 5,896.85 7,166.99

6. OTHER LIABILITIES

Long-term liabilitiesAdvances from customers - 133.53

Current liabilitiesCurrent maturities of long-term debt 4 3,548.62 4,277.12 Interest accrued and due on borrowings 181.50 172.21 Interest accrued but not due on borrowings 105.01 474.92 Payables on purchase of fixed assets 1,663.02 1,212.75 Trade advances 2,003.11 4,023.16 Trade deposits 3,119.52 3,852.31 Unclaimed Share Application Money * 0.18 0.18 Unclaimed Dividend * 2.77 1.92 Advances from related parties 18,362.90 2,297.09 Payables to statutory and other authorities 295.54 372.44

29,282.17 16,684.10 29,282.17 16,817.63

*Note: There is no amount due and outstanding as at the Balance Sheet date to be credited to Investor Education and Protection Fund

7. PROVISIONS

Long-term provisionsProvision for employee benefits

Gratuity 32 304.23 417.15 Leave benefits 32 286.89 464.10

591.12 881.25

Short-term provisionsProvision for employee benefits


Taxation (Net of Payments) 2,229.52 423.89 Proposed Dividend - 1,276.35 Proposed Interim Dividend 5,743.60 - Tax on Proposed Dividend 976.12 207.06

9,009.93 1,965.79 9,601.05 2,847.04

Notes


Particulars Principal terms

Rupee term loans

Vehicle Loans

13,769.922,430.00

31.64

Repayable in equated quarterly installments of Rs. 601.51 Lacs Repayable in equated monthly installments of Rs. 83.33 Lacs

Repayable in equated monthly installments of Rs. 1.88 Lacs

e. The terms of repayment of term loans and other loans :

(Rupees in Lacs)

Sr.No.

Descriptionof Assets

Gross Block (At cost) Depreciation / Amortisation Net Block As at

01-01-13Additions

during theyear

Deductionduring the

year*

As at31-12-13

As at31-12-12

Upto01-01-13

- 2,273.51

265.52

25,079.42 876.53 314.75 90.08

391.35

750.09 30,041.25 22,899.75

509.76 509.76

542.27

30,551.01

23,442.02

For theYear

- 338.90

-

5,109.49 155.20 49.45 18.04 75.48

46.15 5,792.71 7,160.25

3.40 3.40

19.19

5,796.11

7,179.44

Deduction during the

year*

Upto31-12-13

A.123

456789

B1

Tangible AssetsFreehold LandBuildings Improvement to leasehold propertyPlant & EquipmentElectrical InstallationFurniture & FixturesOffice EquipmentsVehiclesData Processing Equipments(A)Previous YearIntangible AssetsComputer Software (B)

Previous Year

TOTAL (A+B)

Previous Year

1,530.78 13,423.09

265.52

88,756.33 3,788.10

884.09 165.72 809.72

891.89 110,515.24

89,034.63

509.76 509.76

561.46

111,025.00

89,596.09

- 1,042.53

-

4,417.90 97.33

- 15.80 8.33

111.92 5,693.81 21,511.36

199.90 199.90

-

5,893.71

21,511.36

617.28 8,528.84

265.52

31,980.06 1,436.62

245.48 1.63 53.62

28.73 43,157.78

30.75

509.76 509.76

51.70

43,667.54

82.45

913.50 4,837.97

-

41,854.46 1,735.67

364.37 72.39

334.75

203.12 50,316.23 80,473.99

196.50 196.50

-

50,512.73

80,473.99

1,530.78 11,149.58

-

63,676.91 2,911.57

569.34 75.64

418.37

141.80 80,473.99

- -

19.19

80,473.99

As at31-12-13

913.50 5,936.78

-

61,194.17 2,448.81

638.61 179.89 764.43

975.08 73,051.27 110,515.24

199.90 199.90

509.76

73,251.17

111,025.00

- 1,513.60

265.52

10,849.20 318.59 89.96 0.62

37.15

24.28 13,098.92

18.75

509.76 509.76

51.70

13,608.68

70.45

- 1,098.81

-

19,339.71 713.14 274.24 107.50 429.68

771.96 22,735.04 30,041.25

3.40 3.40

509.76

22,738.44

30,551.01

9. FIXED ASSETS

Notes forming part of the Financial Statements(Rupees in Lacs)

As at31-12-2013

As at31-12-2012

8. TRADE PAYABLES

Sundry CreditorsMicro & Small Enterprise 108.19 77.59 Others 10,209.02 9,967.62

10,317.21 10,045.21

a. Disclosures required by Micro, Small and Medium Enterprises Development Act, 2006 (“MSM Act”) are as under :-

Principal amount remaining unpaid to any supplier as at the year end. 108.19 77.59 Interest due on the above mentioned principal amount remaining unpaid to any supplier as at the year end 7.59 7.70 Amount of the interest paid by the Company in terms of Section16 of MSM Act along with the amount of the payment made to the supplier beyond the appointed day during the accounting year - - Amount of interest due and payable for the period of delay in making payment but without adding the interest specified under the MSM Act. - - Amount of interest accrued and remaining unpaid at the end of the accounting year 51.92 44.33

Note :The above information has been determined to the extent such parties could be identified on thebasis of information available with the Company.

Notes


* Deductions include transfers on slump sale of infusion business


As at31-12-2013

As at31-12-2012

10. INVESTMENTS

1. Non-Current InvestmentsI. TradeA. In Equity Instruments(a) Of Subsidiaries , unquoted

(I) Catalys Venture Cap Limited, Mauritius 504.93 504.93 1,140,600 Ordinary Shares of US$ 1 each fully paid-up

(ii) Claris Produtos Farmaceuticos do Brasil Ltda, 935.03 935.03 4,642,248.46 Quotas of Brasilian Real 1 each fully paid-up

(iii) Claris Lifesciences Venezuela C.A. 0.35 0.35 1,000 Common Shares of Bolivars 1,000 each fully paid-up

(iv) Claris Lifesciences Indonesia, PT 45.10 45.10 100,000 Ordinary Shares of Indonesia Rupiah 9,108 each fully paid-upLess : Provision for long-term diminution in value 25 (45.10) (45.10)

- - (v) Claris Lifesciences Colombia Ltda 73.70 73.70

271,661Quotas of Colombian Pesos 1,000 each fully paid-up(vi) Claris Lifesciences Philippines, INC. 93.97 93.97

102,000 Ordinary Shares of Philippine Pesos 100 each fully paid-up (vii) Claris Lifesciences de Mexico SA de CV 2.00 2.00

50 Ordinary Shares of Mexican Pesos 1000 each fully paid-up(viii)Claris Lifesciences Inc., USA 0.08 0.08

200 Ordinary Shares of US $ 1 each fully paid-up (ix) Claris Lifesciences (UK) Limited 0.08 0.08

100 Ordinary Shares of GBP 1 each fully paid-up(x) Claris Lifesciences (Aust) Pty Ltd 0.03 0.03

100 Ordinary Shares of AUD 1 each fully paid-up(xi) Claris Lifesciences & Cia Chile Limitada 28.52 28.52

100% of Social Rights (xii) Icubix Infotech Limited 4.99 4.99

49,940 Equity Shares of Rs.10 each fully paid-up.(xiii)Claris Lifesciences International Limited 5.00 5.00

50,000 Equity Shares of Rs. 10 each fully paid-up.(xiv)OGEN Nutrition Limited 5.00 5.00

50,000 Equity Shares of Rs. 10 each fully paid-up.(xv) Claris Infrastructure Limited 5.00 5.00

50,000 Equity Shares of Rs. 10 each fully paid-up.(xvi)Claris Otsuka Limited - 5.00

Nil (5,00,000) Equity Shares of Rs. 10/- each fully paid-up. 1,658.68 1,663.68

(b) Of Associate , unquoted(i) Claris Otsuka Limited 200.00 -

20,00,000 (Previous year NIL )Equity Shares of Rs. 10/- each fully paid-up. 1,858.68 1,663.68

II. Non-TradeA. In Equity instruments of other entities, unquoted

(i) Indian Renal Foundation 1.94 1.94 19,400 Equity Shares of Rs. 10/- each fully paid

Total non-current 1,860.62 1,665.62

2. Current InvestmentA. In Preference Share of Other Entities, quoted

(i) L&T Finance Holding Limited 1,000.00 - 10,00,000 (Previous Year - Nil )9% Cumulative Compulsorily Redeemable Preference Shares of Rs. 100 each, fully paid up

(ii) IL and FS Transportation Networks Limited 1,000.00 - 50,00,000 (Previous Year - Nil ) 10.53% Cumulative Non-Convertible CompulsorilyRedeemable Preference Shares of Rs. 20 each, fully paid up

2,000.00 -

Notes



As at31-12-2013

As at31-12-2012

B In Bonds/Debentures of other entities , quoted(i) India Infrastructure Finance Company Limited 1,000.00 -

1,00,000 units (Previous Year - Nil ) of 8.50% Tax Free Secured, Redeemable, Non-Convertible Bonds of Rs. 1,000 each

(ii) India Infrastructure Finance Company Limited 1,000.00 - 1,00,000 units (Previous Year - Nil ) of 8.66% Tax Free Secured, Redeemable, Non-Convertible Bonds of Rs. 1,000 each

(iii) India Infoline Finance Limited 2,692.17 - 22,500 units (Previous Year - Nil ) of 11.50% Secured Redeemable, Non- Convertible Debentures of Rs. 10,000 each

(iv) India Infoline Finance Limited 1,451.70 - 1,14,692 units (Previous Year - Nil ) of 11.70% Secured Redeemable, Non Convertible Debentures of Rs. 1,000 each

6,143.87 - C. Investments in Mutual Funds

(i) 2,55,561.926 units (Previous Year - Nil ) of Reliance Liquid Fund 7,777.12 - (ii) 65,22,965.128 units (Previous Year - Nil ) of HDFC Cash Management Fund 1,705.73 - (iii) 3,19,227.335 units (Previous Year - Nil ) of Religare Invesco Liquid Fund 5,500.00 - (iv) 30,00,000 units (Previous Year - Nil ) of IIFL-Short Term Income Fund 300.00 - (v) 21,96,595.277 units (Previous Year - Nil ) of HDFC Gilt Fund 500.00 - (vi) 36,52,487.709 units (Previous Year - Nil ) of IDFC Government Securities Fund 500.00 - (vii) 1,81,595.405 units (Previous Year - Nil ) of Principal Cash Management Fund 2,200.00 -

18,482.85 -

D Other Investmentsa) Commercial Papers(i) 500 units (Previous Year - Nil ) of Tata Motors Finance Limited 2,372.72 - (ii) 1,000 units (Previous Year - Nil ) of Shapoorji Pallonji & Company Limited 4,675.68 - (iii) 500 units (Previous Year - Nil ) of Religare Securities Limited 2,372.36 - (iv) 980 units (Previous Year - Nil ) of Reliance Capital Limited 4,637.01 - (v) 100 units (Previous Year - Nil ) of L&T Finance Holding Limited 480.39 - (vi) 1,500 units (Previous Year - Nil ) of JM Financial Products Limited 6,846.83 - (vii) 1,000 units (Previous Year - Nil ) of Edelweiss Financial Services Limited 4,528.48 - (viii) 1,000 units (Previous Year - Nil ) of Axis Finance Limited 4,813.53 -

30,727.00 - b) Pass Through Certificate(i) 2,266 units (Previous Year - Nil ) of Shinning Metal Trust 1,528.27 -

c) Corporate Deposit with Infrastructure Leasing & Financial Services Limited 2,000.00 -

Total Current Investments 60,881.99 -

Total Investments 62,742.61 1,665.62

a. Aggregate amount in quoted investments 8,143.87 - b. Aggregate amount in unquoted investments 36,115.89 1,665.62 c. Aggregate amount invested in Mutual Funds 18,482.85 - d. Aggregate market value of quoted investments 8,263.47 - e. Aggregate market value of Mutual Funds 18,564.27 - f. Aggregate provision made for diminution in value of investments 45.10 45.10

Notes


(Rupees in Lacs)

As at31-12-2013

As at31-12-2012

11. LOANS AND ADVANCES

[Unsecured and considered good, unless otherwise stated]Non-current loans and advances

Capital advances 7,377.14 18,669.85 Security & Tender deposits 966.88 702.46 Mat Credit Entitlement 1,153.77 520.46 Electricity and other deposits 12.40 11.45

9,510.19 19,904.22 Current loans and advances

Considered GoodLoans and advances to related parties 15.45 793.64 Balance with Government Authorities 580.86 452.59 Advances to suppliers 2,420.51 5,477.73 Advances recoverable in cash or kind 747.88 617.60 3,764.70 7,341.56

Considered doubtfulLoans and advances to related parties 14.81 166.14 Less : Provision for doubtful advances 14.81 166.14

- - 3,764.70 7,341.56

13,274.89 27,245.78

Amount due from directors / other officers of the Company Rs. Rs.11.37 Lacs (Previous Year Rs. 18.78 Lacs)

12. OTHER ASSETS

[Unsecured and considered good, unless otherwise stated]Non-current assets Fixed Deposit Accounts {pledged with bank} - 126.00

Current assetsInterest accrued

On Bonds 892.53 - On Fixed Deposits 51.70 87.21 On Others 219.07 81.99 1,163.30 169.20

1,163.30 295.20 13. INVENTORIES

(At lower of cost and net realisable value)Raw Materials 1,085.38 1,631.86 Packing Materials 896.40 1,448.53 Work in process 13.a 1,237.65 1,469.76 Finished Goods 705.89 12,644.65

3,925.32 17,194.80

a. Break up of Work in processLarge Volume Parental 224.92 616.15 Small Volume Parental 872.83 613.05 Others 139.90 240.56

1,237.65 1,469.76

Notes



(Rupees in Lacs)

For the year ended on 31-12-2013


14. TRADE RECEIVABLES

(Unsecured)

Exceeding Six Months from the date they became dueConsidered Good 5,911.14 8,111.40 Considered Doubtful 180.10 206.22

6,091.24 8,317.62 Others

Considered Good 9,567.95 16,682.14 Considered Doubtful 217.86 20.22

9,785.81 16,702.36 Less : Provision for Doubtful Debts 397.96 226.44

15,479.09 24,793.54

15. CASH AND CASH EQUIVALENTS

Cash on Hand 3.12 6.96 Cheques on Hand - 84.00 Balances with scheduled banks :Current Accounts 6,039.07 2,709.17 Margin Money Accounts 2,742.71 3,032.16 Fixed Deposit Accounts 125.00 5,500.00 Unclaimed share application money lying in escrow account 0.18 0.18 Unclaimed Dividend Account 2.77 1.92

8,909.73 11,243.43 8,912.85 11,334.39

16. REVENUE FROM OPERATIONS

SalesSales of Products 16.a 63,833.23 72,685.39 Less : Excise duties 953.88 1,348.37

62,879.35 71,337.02 Operating Income

Export benefits 277.73 208.67 Income from Shared Services 448.01 - Sale of scrap 212.91 255.69

938.65 464.36

63,818.00 71,801.38 a. Break up of SalesLarge Volume Parental 40,195.09 49,454.94 Small Volume Parental 18,526.59 17,624.42 Others 5,111.55 5,606.03

63,833.23 72,685.39

17. OTHER INCOME

Interest Incomea. Interest from banks on :

(i) Deposits 316.85 419.54 (ii) Other balances 247.40 242.80

b. Interest income from current investments 2,655.59 - c. Others 52.70 18.16

3,272.54 680.50 Profit On Sales of Mutual Fund Investment 519.87 - Sale of Voluntary Carbon Reduction Units 235.51 215.31 Foreign Exchange Rate Difference (Net) - 190.59 Provision for Product Recall no longer required - 115.40 Miscellaneous Income 21.61 11.35

4,049.53 1,213.15

Notes



(Rupees in Lacs)



18. COST OF MATERIALS CONSUMED, PURCHASE OF STOCK IN TRADE

Raw Materials Consumed 18.a18.b 9,311.93 14,526.63

Packing Materials Consumed 18.c 5,779.07 7,253.58 15,091.00 21,780.21

Purchase of Stock in trade 18.d 9,378.23 4,242.88

24,469.23 26,023.09 a. Break up of Raw Materials Consumed

Glass Bottle 1,175.71 955.43 Amino Acid 519.43 496.95 Plastic Granules 3,666.82 6,619.91 Egg-Lecithin 85.68 833.56 Dextrose Anhydrous 498.97 1,437.48 Other 3,365.32 4,183.30

9,311.93 14,526.63 b. Break-up of consumption of raw materials into imported and indigenous

Imported 7,101.34 8,189.76 76.26% 56.38%

Indigenous 2,210.60 6,336.87 23.74% 43.62%

c. Break up of Packing Materials ConsumedCarton / Corrugated Box 995.69 2,100.08 Others 4,783.38 5,153.50

d. Break up of Goods PurchasedLarge Volume Parental 7,750.41 2,442.88 Small Volume Parental 830.15 819.16 Others 797.67 980.84

9,378.23 4,242.88

19. CHANGES IN INVENTORIES OF FINISHED GOODS AND WORK-IN-PROGRESS

Stocks at the end of the yearWork-in Progress 1,237.65 1,469.76 Finished Goods 705.89 12,644.65

1,943.54 14,114.41

Stocks at the beginning of the yearWork-in Progress 1,469.76 1,218.41 Finished Goods * 331.05 11,026.17

1,800.81 12,244.58 (142.73) (1,869.83)

*Opening stock of finished goods is after adjustment in respect of the slump sale of infusion business and other related agreements

20. EMPLOYEE BENEFITS EXPENSE

Salaries, Wages, Bonus & Gratuity 4,459.45 4,639.88 Contribution to Provident and other funds 150.57 163.28 Staff Welfare 114.85 119.65

4,724.87 4,922.81

21. FINANCE COST

Interest Expense 4,029.13 5,107.55 Other borrowing cost 651.49 750.84 Bank Charges & Commission 529.50 632.85

5,210.12 6,491.24

Notes



1,909.37

534.988.93

85.7410,400.00

600.553,275.94

161.12

1,626.64

392.278.93

87.7810,400.00

509.593,905.61

851.10

(Rupees in Lacs)

a. Claim against the company not acknowledge as debtsb. Disputed demand under : (i) Income Tax (ii) Sales Tax (iii) Excise Duty (iv) Regulatoryc. Guarantees given by the bankers on behalf of the companyd. Bills discountede.Letters of credit outstanding

As at31-12-2012

As at31-12-2013

23. Contingent Liabilities

17,971.87

1,860.45

(Rupees in Lacs)

A. Estimated amount of contracts remaining to be executed on capital account and not provided for; (net of capital advances)B. Outstanding obligation to export goods worth Rs. 6,692.54 Lacs (Previous year Rs. 36,959.47 Lacs) within the stipulated period as per Export Promotional Capital Goods Scheme, failing which additional custom duty payable would amount to

As at31-12-2012

As at31-12-2013

24. Commitments & Obligations

3,736.79

7,622.07

(Rupees in Lacs)



22. OTHER EXPENSES

Conversion charges 131.13 408.33 Stores & Spares Consumed 994.02 651.82 Contract Labour Charges 1,074.10 1,272.85 Laboratory expenses 652.11 503.68 Power & Fuel 1,807.51 3,472.16 Insurance 105.32 105.70 Rent 371.50 393.72 Outward freight 5,457.49 4,306.79 Commission 787.90 677.88 Marketing and Sales Promotion Expenses 1,943.37 1,994.90 Traveling 1,760.50 1,501.11 Stationery & Printing 100.20 94.36 Communication Expenses 236.69 210.28 Rates and Taxes 15.03 13.70 Repairs to Building 128.66 85.78 Plant & Machinery 175.40 210.32 Others 487.74 386.21 Bad Debts written -off - 73.65 Provision for doubtful debts and advances 20.19 133.62 Foreign Exchange Rate Difference (Net) 916.14 - Excise Duty (73.71) 63.29 Consultancy Fees 737.31 1,428.14 Legal Fees & Charges 238.53 265.93 Professional Charges 122.14 122.41 General Charges 784.05 1,207.21 Donations 42 21.73 10.95

18,995.05 19,594.79

Notes



25. PT Claris Lifesciences Indonesia (CLI), a wholly owned subsidiary of the Company in Indonesia, has been incurring losses which has resulted in complete erosion of the networth of CLI. The changes in import regulations in Indonesia have given rise to uncertainties with respect to recoverability of the value of the long term investments in foreseeable future. In view of this, considering accounting prudence, an amount of Rs. 45.10 Lacs had been recognized towards diminution in value of the long term investments in the financial statements for the year ended 31st December 2012.

26. Excise duty shown as deduction from Sales represents the amount of excise duty collected on sales. Excise duty expenses under Note No 22, “Operating and Other Expense”, represents the difference between excise duty element in the amounts of closing stocks and opening stocks and excise duty paid on materials manufactured for captive consumption.

27. Capital Work In Progress includes preoperative expenditure pending allocation to projects under implementation, the break up of which is as under:

Fixed Asset

(Rupees in Lacs)


13.814,050.18

3.294067.28

BuildingPlant & MachineryElectrical InstallationTotal


-793.35

-793.35

Details of Preoperative Expenses capitalized during the year:

Preoperative Expenses

1,367.41805.8626.9681.17

2,246.559.72

(4,067.28)470.39

(Rupees in Lacs)

Opening balance Add : Interest and finance charges Consultancy / Professional Fees Personnel Cost Foreign Exchange Rate Difference Other Expenses Less: Capitalized during the year Closing balance

As at31-12-2012

As at31-12-2013

820.81788.49

37.70-

504.329.44

(793.35)1,367.41


(Rupees in Lacs)


292.100.370.907.74

301.11

22.4717.3839.85

2.82

-


259.100.370.900.55

260.92

22.4716.9739.44

2.76

-a) Managerial Remuneration Paid to Directors/Key Management Personnel Salary Contribution to Provident Fund Perquisites Sitting Fees paid to Non-Executive Directors TotalNote: Provision for leave encashment and gratuity benefits which is based on actuarialvaluation done on an overall company basis is not included in the above

b) Payment to Auditors Audit Fees Certification and Other Services Total Cost audit fees

29.The provision for current tax has been made as per the provisions of the Income Tax Act, 1961. The tax year for the Company being the year ending 31st March, the provision for current tax for the year is the aggregate of the provision required for the three months ended 31st March 2013 and the provision required for the remaining nine months up to 31st December 2013, the ultimate tax liability of which has been estimated on the basis of the actual / projected figures for the period from 1st April 2013 to 31st March 2014.

28.Statement of Profit and Loss account includes: -


(Rupees in Lacs)

Forward cover for Export receivable

Exposure hedged by derivative instruments: -

No. of Contracts

2013 2012

- 3

Foreign Currency

Amount

2013 2012

- 70.00

Reporting Currency

Amount (INR)

2013

-

2012

EUR 5,058.20

(Rupees in Lacs)

Loan Outstanding USDAccounts ReceivableUSDEURGBPCHFAUDNZDSEKJPYAccounts PayableUSDEURGBPAUDCHFNZD

Unhedged Exposures

Foreign Currency

Amount

2013 2012

-

245.3947.047.330.292.940.020.99

41.42

294.3150.144.375.65

13.600.06

350.00

382.7138.164.577.58

11.880.960.99

41.42

278.1958.962.09

13.01-

0.45

Reporting Currency

Amount (INR)

2013 2013

-

15,189.444,014.33

747.6220.21

161.170.869.45

24.42

18,217.984,280.14

445.89309.92943.73

3.09

19,173.00

20,964.652,757.51

404.22456.33677.4043.468.39

26.37

15,239.054,260.60

184.65741.90

-20.47

31.Pursuant to notification dated 29th December, 2011 issued by Central Government under Companies (Accounting Standard) Amendment Rules, 2009; with effect from April 1, 2011, the Company exercised the option whereby, the exchange differences arising on settlement or on translation of long-term foreign currency monetary items, so far as they relate to the acquisition of a depreciable capital asset, are added to or deducted from the cost of the asset and are depreciated over the balance life of the asset.


30.Disclosures regarding Derivative Instruments:a. The Company uses forward exchange contracts to hedge its exposure in foreign currency. There are no contracts entered into for the purpose of

speculation.b. The information on derivative instruments as on 31st December 2013 is as follows:

(Rupees in Lacs)


2,246.55-

Amount added/(reduced) from capital assetsAmount remaining to be depreciated


504.32958.95


i. Expenses recognized in Profit & Loss Account for the

year ended on 31st December

(Rupees in Lacs)

Current service cost

Interest Cost

Expected return on plan assets

Net actuarial losses (gains)

Total Expenses

32. Employee Benefits

Gratuity

a. Defined Benefit Plans

2013

52.82

33.97

-

(44.24)

42.55

2012

79.96

31.62

-

(15.34)

96.23

Leave Encashment

2013

39.81

37.52

-

(32.53)

44.80

2012

61.90

27.75

-

117.55

207.20

ii. Reconciliation of Closing balances of changes in present value of the Defined Benefit Obligation

Opening defined benefit obligation

Amount transferred

Service Cost

Interest Cost

Actuarial losses (gains)

Losses ( gains) on curtailments

Liabilities extinguished on settlements

Benefits paid

Closing defined benefit obligation

444.64

(115.36)

52.82

33.97

(44.24)

-

-

(40.07)

331.76

393.74

-

79.96

31.62

(15.34)

-

-

(45.33)

444.64

495.10

(167.68)

39.81

37.52

(32.53)

-

-

(52.18)

320.05

363.42

-

61.90

27.75

117.55

-

-

(75.51)

495.11

iii. Reconciliation of Opening and Closing balances of changes in fair value of plan assets

Opening fair value of plan assets

Expected return on plan assets

Actuarial gains and (losses)

Assets distributed on settlements

Contributions by employer

Benefits paid

Closing balance of fair value of plan assets

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

iv. Net Liability recognized in the Balance sheet

Defined Benefit Obligation

Fair value of plan assets

Present Value of unfunded obligation recognized as liability

331.76

-

331.76

444.64

-

444.64

495.11

-

495.11

320.05

-

320.05

v. Past four years data for define benefit obligation and fair value of plan assets are as under:

Gratuity




Leave Encashment




For the year ended 31st December

2012 2011 2010 2009

444.64

-

444.64

495.10

-

495.10

393.74

-

393.74

363.42

-

363.42

361.38

-

361.38

345.26

-

345.26

285.80

-

285.80

233.63

-

233.63



b)Defined Contribution Plans

Rs. 124.34 Lacs (Previous Year Rs. 134.33 Lacs) recognized as an expense and included in the Notes 20 of Profit and Loss Account under the head

"Contribution to Provident and other funds".

33. Segment Information

I) Primary Segment:

In accordance with the requirements of Accounting Standard –17 on Segment Reporting, the Company has determined its business segment as

“Drugs & Pharmaceuticals”. Since all of the Company’s business is from “Drugs and Pharmaceuticals’, there are no other primary reportable

segments. Thus the segment revenue, segment result, total carrying amount of segment liabilities, total cost incurred to acquire segment assets,

the total amount of charge for depreciation during the year are all reflected in the financial statements as of and for the year ended 31st

December, 2013.

vi. Actuarial Assumptions

Discount Rate

Expected rate of salary increase

Mortality

Withdrawal Rates

Retirement Age

Actuarial Valuation Method

9.30%

6.00%

Indian Assured Lives Mortality (2006-08) Ult.

3% younger ages reducing to 1% at old ages

58 Years

Projected Unit Credit Method

8.00%

6.00%

LIC (1994-96) published table of mortality rates

3 % younger age reducing to 1 % old age

58 Years

Projected Unit Credit Method

As at 31-12-2013 As at 31-12-2012

Revenue

Carrying amounts of segment assets

Capital expenditure

(Rupees in Lacs)

India

21,882.03

(35,521.21)

1,60,645.82

(1,66,459.99)

5,796.18

(34,746.73)

ii. Secondary Segment (Geographical Segment)

Outside India

40,997.32

(35,815.81)

12,694.23

(13,970.11)

-

(-)

Total

62,879.35

(71,337.02)

1,73,340.05

(1,80,430.10)

5,796.18

(34,746.73)

Note: Figures in brackets are in respect of previous year.

34. Related party disclosures as required by Accounting Standard 18, ” Related Party Disclosures”, issued by the Institute of Chartered Accountants of

India are given below.

Name of the Related Parties

A. Subsidiary Companies

Claris Lifesciences Venezuela C. A

Claris Produtos Farmaceuticos Do Brasil Limitada

PT. Claris Lifesciences Indonesia

Claris Lifesciences Colombia Limitada

iCubix Infotech Limited

Catalys Venture Cap Limited

Claris Lifesciences International Limited

Claris Lifesciences Philippines Inc

Claris Lifesciences De Mexico SA de CV

Claris Lifesciences (UK) Limited

Claris Lifesciences (Aust) Pty. Limited

Claris Lifesciences Inc.

Claris Lifesciences & CIA Chile Limitada

OGEN Nutrition Limited

Claris Infrastructure Limited

Claris Pharmaservices

Claris SteriOne

Claris Otsuka Limited (upto July 31, 2013)

(A)Particulars of related parties and nature of relationships:


B. Associate Company

Claris Otsuka Limited (from August 1, 2013)

C. Companies over which Key Management Personnel and

their relatives are able to exercise significant influence

Sarjan Financial Private Limited

Medical Technologies Limited

D. Key Management Personnel

Mr. Arjun Handa


Mr. Amish P. Vyas


E. Relatives of Key Management Personnel

Mr. Aditya S. Handa



(Rupees in Lacs)

For the Year ended on 31st Dec 2013

For the Year ended on 31st Dec 2012

a) Nature of Transactions1. Sales

To Subsidiary CompaniesClaris Produtos Farmaceuticos Do Brasil Limitada - 96.04Claris Lifesciences Philippines Inc 967.07 1,628.68Catalys Venture Cap Limited - 665.81Claris Lifesciences Inc. 1,087.62 96.41

To AssociatesClaris Otsuka Limited 1,740.26 -

2. Sale of AssetsTo Associates

Claris Otsuka Limited 3,761.82 -

3. Services PurchasedFrom Subsidiary Companies

iCubix Infotech Limited 157.30 182.02

4. Services RenderedTo Associates


5. PurchasedFrom Associates


6. Expense ReimbursedTo Subsidiary Companies

Claris Lifesciences (Aust) Pty. Limited 1.74 0.89Claris Lifesciences (UK) Limited 0.88 0.43Claris Produtos Farmaceuticos do Brasil Limitada - 398.14Claris Lifesciences Inc. - 111.98Others - 147.54

To AssociatesClaris Otsuka Limited 915.08 -

7. Remuneration Paid To Key Management Personnel

Mr. Arjun Handa 150.59 150.59Mr. Chandrasingh S. Purohit 47.59 36.59Mr. Amish P. Vyas 47.59 36.59Mr. Chetan S. Majmudar 47.59 36.59

8. Dividend PaidTo Key Management Personnel

Mr. Arjun Handa 156.01 156.01To Companies in which Key Management Personnel have Controlling Interest

Sarjan Financial Private Limited 475.60 475.60 Medical Technologies Limited 93.06 93.06

To Relative of Key Management PersonneMr. Aditya S. Handa 67.43 134.01

9. Doubtful debts/Advances Provided for the yearOf Subsidiary Companies

PT. Claris Lifesciences Indonesia 381.61 93.82Claris Lifesciences Philippines Inc 20.79 20.22Claris Produtos Farmaceuticos Do Brasil Limitada - 52.45Others 10.38 8.75

10.Received on Slump SaleFrom Associates

Claris Otsuka Limited 1,05,040.00 -

11. Advances Granted during the YearTo Subsidiary Companies

Claris Produtos Farmaceuticos Do Brasil Limitada 5,246.22 242.21Catalys Venture Cap Limted 0.92 3,347.79Claris Lifesciences De Mexico SA de CV 1,576.17 41.56Others 677.02 546.85

Notes


(B) Related party transactions


(Rupees in Lacs)

As at31-12-2013

As at31-12-2012

12.Advances Received during the YearFrom Subsidiary Companies

Catalys Venture Cap Limited 5,177.28 3,124.43Claris Lifesciences & CIA Chile Limitada 1,251.76 -Claris SteriOne 855.68 -Others 277.66 1.18

13.Investment made during the yearFrom Subsidiary Company

Claris Otsuka Limited - 5.00From Associate

Claris Otsuka Limited 195.00 -

b) Balances at the end of the year1. Outstanding Payables

To Subsidiary Companies iCubix Infotech Limited 1.55 17.60

2. Outstanding Receivables From Subsidiary Companies

Claris Produtos Farmaceuticos Do Brasil Limitada - 854.18 Catalys Venture Cap Limited - 3,508.13 PT. Claris Lifesciences Indonesia 377.19 333.81

Claris Lifesciences Philippines Inc 386.87 272.37Others 6.88 33.27

From AssociatesClaris Otsuka Limited 1,212.63 -

3. Provision for Doubtful Debts PT. Claris Lifesciences Indonesia 377.18 206.22 Claris Lifesciences Philippines Inc 20.79 20.22

4. Advances Received Outstanding To Subsidiary Companies

Claris Produtos Farmaceuticos do Brasil Limitada 2,486.31 -Claris Lifesciences & CIA Chile Limitada 1,183.95 68.26Catalys Venture Cap Limited 1,277.97 -Claris Lifesciences De Mexico SA de CV 1,745.13 241.59Claris SteriOne 872.79 5.48Claris Lifesciences Inc. 189.10 1,509.39Others 607.65 472.36

To Associate CompaniesClaris Otsuka Limited 10,000.00

5. Advances Granted Outstanding (Net of provision for Doubtful advances)From Subsidiary Companies

Claris Produtos Farmaceuticos do Brasil Limitada. - 517.29Claris Lifesciences Inc. - 272.85Claris Lifesciences International Limited 7.20 3.50PT. Claris Lifesciences Indonesia 16.18 -OGEN Nutrition Limited 6.16 -Others 0.71 -

From Key Management PersonnelMr. Amish P. Vyas 3.79 1.74Mr. Chetan S. Majmudar 7.58 7.21Mr. Chandrasingh S. Purohit - 4.98

6. Provision for doubtful Advances PT. Claris Lifesciences Indonesia 4.43 104.94 OGEN Nutrition Limited 6.16 5.59 Claris Produtos Farmaceuticos do Brasil Limitada. - 52.45

Claris Lifesciences International Limited 3.53 3.07Others 0.69 0.09



Basic & Diluted EPSComputation of Profit (Numerator)

(i) Net Profit for the year from Continuing Operations(ii) Net Profit for the year from Total Operations

Weighted Average Number of Shares (Denominator)Weighted average number of Equity shares of Rs.10 each used For calculation of Basic Earnings Per Share

Basic & Diluted EPS ( in Rs.)(i) Continuing Operations(ii) Total Operations

Face value per share (in Rs.)* Refer Note 37 ( c )


3,921.338,121.85

Nos.

63,817,765

6.1412.7310.00


* 7,441.62

Nos.

63,817,765

*11.6610.00

(Rupees in Lacs, except per share data)36.Computation of Earnings per Share (EPS) :

37. Discontinuing operations On December 7, 2012,the management of the Company entered in to certain agreements with Otsuka Pharmaceutical Factory, Inc., Japan (‘Otsuka’) and Mitsui & Co. Ltd., Japan (‘Mitsui’) for transfer of its Infusion Business to Claris Otsuka Limited on ‘slump sale’ basis. The said infusion business includes identified products of Common Solutions, Anti Infective, Plasma Volume Expanders and Parenteral Nutrition in India and in Emerging markets (herein after referred to as ‘the infusion business’).

The Board of Directors of the Company, in its meeting held on December 7, 2012 had passed necessary resolutions approving the transfer of the infusion business to Claris Otsuka Limited and upon getting the necessary approvals from the shareholders, through postal ballot on 18th February, 2013 and after getting approvals from statutory and regulatory authorities, the transfer of the infusion business was completed on 31st July, 2013.

a) As per the terms of the agreements, the Company has received Rs. 103,182.42lacs (Rs. 105,040.00 lacs less Rs. 1,857.58 lacs for liabilities transferred) as consideration for the net assets of the infusion business transferred in favor of Otsuka and Mitsui, who have, in effect, subscribed towards equity share capital and towards Securities Premium of Claris Otsuka Limited, pursuant to which, Otsuka, Mitsui and the Company respectively hold 60 %, 20% and 20% of the equity share capital of Claris Otsuka Limited. The purchase consideration includes Rs. 30,000 Lacs towards transfer of intangible assets which are recognised by the Company as and when the Intangible assets are transferred in the name of Claris Otsuka Limited.


Lease payments recognized in the profit and Loss account for the yearMinimum lease payments under the agreements are as follows. a) Not later than one year b) Later than one year but not later than 5 Years c) Later than five years


299.14

298.991242.17734.86

35. Disclosure for operating leases under Accounting Standard 19 – “Accounting for Leases”The Company has entered into agreements for taking on leave and license basis residential / office premises including furniture and fittings therein, as applicable, for a period ranging from 11 to 60 months. The specified disclosure in respect of these agreements is given below:

(Rupees in Lacs)


267.67

285.091209.561052.77

(Rupees in Lacs)

As at31-12-2013

As at31-12-2012

7. Investments Balance at the end of the period( net of Provision for Diminution in value)From Subsidiary Companies

Claris Produtos Farmaceuticos Do Brasil Limitada 935.03 935.03 Catalys Venture Cap Limited 504.93 504.93

Others 218.72 223.72From Associate CompaniesClaris Otsuka Limited 200.00 -

8. Provision for diminution in value of investment From Subsidiary Companies PT. Claris Lifesciences Indonesia 45.10 45.10


Purchase of goods traded-inRaw MaterialsPacking MaterialPlant & MachineryStores and Spares


84.136,588.061,839.481,783.33

32.01


463.796,731.841,689.66

13,687.55115.38

(Rupees in Lacs)38. C.I.F. Value of Imports:


The pre-tax gain on disposal of assets and settlement of liabilities attributable to the sale of the infusion business of Rs. 1,505.98 lacs (net of deal related expenses of Rs. 1,883.22 lacs) has been disclosed in the statement of profit and loss as an exceptional item, being profit on disposal of infusion business under slump sale. The income tax expense in this respect relating to the capital gain tax of Rs. 2,264.64 lacs andreversal of deferred tax liability of Rs. 2,885.18 lacs have been included in the current tax and deferred tax amounts respectively in the statement of profit and loss.

b) Necessary disclosures of the details pertaining to the discontinuing operations in respect of the infusion business and the reorganization thereof as stated above, as required under the Accounting Standard – 24 ‘Discontinuing Operations’ (AS-24) as notified by the Government of India under Section 211(3C) of the Companies Act, 1956,are as under : -

RevenueExpenditureProfit Before taxProfit after taxTotal AssetsTotal LiabilitiesCash flow (used in)/from Operating activitiesCash flow (used in)/from Investing activities Cash flow (used in)/from Financing activities

For the Year ended on 31-12-2013#

22,055.7319,097.112,958.622,074.10

91,650.781,857.585,113.40

0.00(1,121.00)

(Rupees in Lacs)

For the Year ended on 31-12-2012*

42,854.56Refer note (C)Refer note (C)Refer note (C)

73,630.105,845.03

Refer note (C)(9,678.13)

3,357.32

# For the period from 1st January 2013 to 31 July 2013 / as at 31st July 2013.* As per disclosures made in the financial statements for the previous financial year ended on 31st December 2012

c) The Company operates under a single business segment i.e. ‘Drugs & Pharmaceuticals’ as per the requirements of Accounting Standard – 17 ‘Segment Reporting’. The transfer of the infusion business involved transfer of assets and liabilities as are related to the infusion business and as the same are identified by the parties to the transaction. For this purpose, the products, employees, tangible and intangible assets, current assets, market territories, long term and short term borrowings, other liabilities etc. have been identified as are related to the infusion business. In view of common employees, marketing expenses, logistics and distribution arrangements and general corporate overheads, which are not separately identifiable for identified products of the infusion business being transferred, the Company is unable to determine the income and expenses clearly attributable to the discontinued operations. As per the practice followed by the Company for preparation of its financial statements for financial reporting purposes, its present system of maintenance of books of account and other relevant records does not provide clearly identifiable details of income and expenditure as are related to the infusion business. Under the facts and circumstances, for the period from 1st January 2013 to 31st July, 2013, the Company has disclosed separately the figures for expenditure attributable to discontinuing operations, profit from the continuing and from the discontinuing operations, tax expense of discontinuing operations, profit from discontinuing operations (after tax) and cash flows from operating activities on best estimate basis. However, such figures for the previous corresponding year are not available, and hence not disclosed.

d) In view of the above stated transfer of infusion business, the figures for the financial year reported in the statement of profit and loss and the cash flow statement do not include the figures of the infusion business for the period from 1st August, 2013 to 31st December 2013 and the figures in the balance sheet as at 31st December 2013 do not include the figures pertaining to the infusion business. Under the circumstances, the same are not comparable with the corresponding previous year figures which included figures for the infusion business for the whole of the previous year.











45. Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure.


Bhartiya Janta Party


-


2.00

(Rupees in Lacs)42.Payment to Political Party

43. Current Assets, Loans and Advances as at 31st December 2013 have a value on realization in the ordinary course of business at least equal to the amount at which they are stated.

Number of non-resident shareholdersNumber of equity shares on which dividend was paid (Lacs)Year ended to which the dividend relatedAmount remitted (Rupees in Lacs)


254188.28

2012376.56


266156.53

2011313.07

44.Remittance in foreign currency during the year on account of dividend.

Expenditure on research and development charged to revenue

FOB value of ExportsOperating IncomeSales of Voluntary Carbon Reduction Units


335.24


35,354.4654.26

235.51


230.47


33,787.60-

215.30

(Rupees in Lacs)

(Rupees in Lacs)

40.Research and Development Expenditure:

41.Earnings in foreign exchange:

Consultancy FeesTesting ChargesLegal Fees & ChargesTravelingFreightCommissionInterest & Finance chargesOthers Product Registration Fees, Sales Promotion Expenses, Advertisement - Marketing etc.)


326.9143.719.23

879.96828.25453.15149.38943.70


93.1518.0277.80

567.57717.8397.62

112.48873.30

(Rupees in Lacs)39.Expenditure in foreign currency:


We have audited the accompanying consolidated financial statements of CLARIS LIFESCIENCES LIMITED (the “Company”) and its subsidiaries (the Company and its subsidiaries constitute “the Group”), which comprise the Consolidated Balance Sheet as at 31st December, 2013, the Consolidated Statement of Profit and Loss and the Consolidated Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management’s Responsibility for the Consolidated Financial StatementsThe Company’s Management is responsible for the preparation of these consolidated financial statements that give a true and fair view of the consolidated financial position, consolidated financial performance and consolidated cash flows of the Group in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the consolidated financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors’ ResponsibilityOur responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company’s preparation and presentation of the consolidated financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

OpinionIn our opinion and to the best of our information and according to the explanations given to us, and based on the consideration of the reports of the other auditors on the financial statements of the subsidiaries referred to below in the Other Matter paragraph, the aforesaid consolidated financial statements give a true and fair view in conformity with the accounting principles generally accepted in India:

(a)in the case of the Consolidated Balance Sheet, of the state of affairs of the Group as at31stDecember, 2013;(b)in the case of the Consolidated Statement of Profit and Loss, of the profitof the Group for the year ended on that date; and(c)in the caseof the Consolidated Cash Flow Statement, of the cash flows of the Group for the year ended on that date.

Other MatterWe did not audit the financial statements of fourteen subsidiaries, whose financial statements reflect total assets of Rs.19,174.18 lacs as at 31stDecember, 2013, total revenues of Rs. 5,875.56 lacs and net cash inflows amounting to Rs. 101.24 lacs for the year ended on that date, as considered in the consolidated financial statements. These financial statements have been audited by other auditors whose reports have been furnished to us by the Management and our opinion, in so far as it relates to the amounts and disclosures included in respect of these subsidiaries, is based solely on the reports of the other auditors. Our opinion is not qualified in respect of this matter.

Auditors’ Reporton the Consolidated Financial Statements

For Deloitte Haskins & SellsChartered Accountants (Registration No. 117365W)



To The Board Of Directors, Claris Lifesciences Limited


Consolidated Balance Sheet

I. EQUITY AND LIABILITIES

(1) Shareholders' funds(a) Share capital 2 6,381.78 6,381.78 (b) Reserves and surplus 3 134,047.69 108,504.92

140,429.47 114,886.70

(2) Non - current liabilities(a) Long-term borrowings 4 12,682.94 29,894.66 (b) Deferred tax liabilities (net) 5 5,878.19 7,143.62 (c) Other long-term liabilities 6 - 133.53 (d) Long-term provisions 7 641.50 932.89

19,202.63 38,104.70

(3) Current liabilities(a) Short-term borrowings 4 10,546.65 20,037.67 (b) Trade payables 8 10,828.80 10,712.68 (c) Other current liabilities 6 21,044.98 14,475.88 (d) Short-term provisions 7 9,039.21 2,011.09

51,459.64 47,237.32 Total 211,091.74 200,228.72

II. ASSETS

(1) Goodwill on consolidation 3.20 3.20 (2) Non - current assets

(a) Fixed assets(i) Tangible assets 9 50,419.03 80,603.30 (ii) Intangible assets 9 6,734.85 6,453.93 (iii) Capital work-in-progress 17,329.26 17,426.79 74,483.14 104,484.02

(b) Non-current investments 10 20,950.07 1.94 (c) Long-term loans and advances 11 19,467.12 28,852.10 (d) Other non-current assets 12 - 126.00

114,900.33 133,464.06 (3) Current assets

(a) Current investments 10 60,881.99 - (b) Inventories 13 4,497.42 18,428.50 (c) Trade receivables 14 15,651.27 22,823.17 (d) Cash and cash equivalents 15 9,459.35 11,769.43 (e) Short -term loans and advances 11 4,534.88 13,571.16 (f) Other current assets 12 1,163.30 169.20

96,188.21 66,761.46

Total 211,091.74 200,228.72 Significant accounting policies 1Other notes forming part of the financial statements 2-34

(Rupees in Lacs) As at 31st December, 2013










Claris Lifesciences Limited and its Subsidiaries

As at31-12-2013

As at31-12-2012

Notes


(Rupees in Lacs)

Consolidated Statement of Profit & LossFor the year ended on 31st December, 2013

RevenueI. Revenue from operations 16

(a) Gross sales 66,791.43 77,622.98 Less : Excise duty 953.88 1,350.64 Net sales 65,837.55 76,272.34

(b) Operating income 938.65 464.36 Revenue from operations (net) 66,776.20 76,736.70

II. Other income 17 4,058.75 1,029.49 III. Total Revenue ( I+ II ) 70,834.95 77,766.19 IV. Expenses

Cost of materials consumed 18 15,091.00 21,780.21 Purchase of stock-in-trade 18 9,095.54 4,686.38 Changes in inventories of finished goods and work-in-progress 19 518.89 (1,418.05)Employee benefits expense 20 5,097.56 5,235.68 Finance costs 21 5,219.45 6,505.26 Depreciation and amortization expense 6,535.38 7,426.91 Other expenses 22 20,034.56 19,971.68

Total expenses 61,592.38 64,188.07 V. Profit before Exceptional items and tax ( III- IV) 9,242.57 13,578.12 VI. Exceptional items

Profit on disposal of infusion business (Discontinuing Operations) under slump sale 33 1,505.98 -

VII. Profit before tax (V+VI) 10,748.55 13,578.12 VIII. Tax Expense :

(a) Current tax 4,106.99 2,081.64 (b) Deferred tax (1,265.97) 1,129.79 (c) MAT credit entitlement (633.31) (0.43)(d) Short / (Excess) provision of tax of earlier years - (24.00)

2,207.71 3,187.00 IX. Profit After Tax and before share of Profit/ (loss) of Associate (VII-VIII) 8,540.84 10,391.12

Profit after tax comprises of :a. Profit from Continuing Operations (after tax) 4,340.32 * b. Profit from Discontinuing Operations (before tax) 33 2,958.62 * c. Profit on disposal of infusion business (discontinuing operation) under slump sale 1,505.98 * d. (Add) / Less: Tax expense / (Reversal) of discontinuing operations;

i) Tax expense of Discontinuing Operations" 884.52 * ii) Tax on disposal of infusion business under slump sale (net of reversal of deferred taxes of Rs. 2,885.18 Lacs)" (620.44) *

X. Share in Loss of Associate (99.87) - XI. Profit for the year 8,440.97 10,391.12 XII. Earnings per share - Basic & Diluted (Nominal value per equity share of Rs.10)" 32

a. Continuing Operations 6.80 *b. Total Operations 13.23 16.28

* Refer Note 33 ( c )Significant accounting policies 1Other notes forming part of the financial statements 2-34






For the year ended on31-12-2013

For the year ended on31-12-2012Notes







(Rupees in Lacs)

Consolidated Cash Flow StatementFor the year ended on 31st December, 2013

A. Cash Flow From Operating Activities

1. Profit before tax 10,748.55 13,578.12

2. Adjustment for :Depreciation and amortisation expense 6,535.38 7,426.91 Finance cost 5,219.45 6,505.26 Interest income (3,275.00) (680.51)(Profit)/Loss on sale of fixed assets - (Net) - (1.11)Provision for doubtful debts and advances 32.66 - Bad debts written-off - 73.65 Gain on sale of Units of Mutual Funds (519.87) - Share in Loss from Associate 99.87 - Profit on disposal of infusion business under slump sale (1,505.98) - Unrealised foreign exchange rate difference (gain)/loss (Net) 2,582.47 (696.21)

Operating profit before working capital changes (1+2) 19,917.53 26,206.11

3. Adjustments for working capital changes:Decrease / (increase) in trade and other receivables 386.45 8,355.42 Decrease / (increase) in inventories 553.82 (1,532.25)(Decrease) / increase in trade and other payables (4,835.70) 2,875.16 Cash generated from/(used in) operations 16,022.10 35,904.43

4. Direct taxes paid (1,683.77) (2,486.67)

Net Cash Generated From/(Used in) Operating Activities [A] 14,338.33 33,417.76

B. Cash Flow From Investing ActivitiesPurchase of fixed assets (Including Capital Advances) (28,230.94) (44,316.78)Proceeds from Sale of fixed assets 1,267.66 13.69 Proceeds from disposal of infusion business under slump sale 105,040.00 -Purchase of Current Investments (60,881.99) -Investment in Associate Company (195.00) - Share in Loss from Associate (99.87) - Interest received 2,280.90 642.10 Gain on sale of Units of Mutual Funds 519.87 -

Net Cash Generated/(Used in) Investing Activities [B] 19,700.63 (43,660.99)

C. Cash Flow From Financing ActivitiesProceeds from long term borrowings (Net) (17,940.22) 12,256.70 Proceeds from short term borrowings (Net) (9,491.02) 1,088.49 Interest paid (5,580.07) (6,241.84)Dividend paid (1,276.35) (1,276.35)Net Cash Generated From/(Used in) Financing Activities [C] (34,287.66) 5,827.00

Net Increase/(Decrease) In Cash & Cash Equivalents [A+B+C] (248.70) (4,416.23)Cash & Cash Equivalents at the beginning of the Year 7,628.15 12,044.38 Cash & Cash Equivalents at the end of the Year 7,379.45 7,628.15


For The Year ended on 31-12-2013

For The Year ended on 31-12-2012


(Rupees in Lacs)

Consolidated Cash Flow StatementFor the year ended on 31st December, 2013

Notes:1 A) Components of Cash & Cash Equivalents

Cash on hand 4.15 8.41 Cheques on hand - 84.00 Balances with banks

- In Current accounts 6,584.54 3,142.76 - In Margin money 665.76 392.98 - In Fixed deposit account 125.00 4,000.00 - In Fixed deposit account with Financial Institution - -

7,379.45 7,628.15 B) Cash and cash equivalents not available for immediate use

a) In Margin money and fixed deposit accounts 2,076.95 4,139.18 b) Unclaimed share application money lying in escrow account 0.18 0.18 c) Unclaimed dividend account 2.77 1.92

2,079.90 4,141.28 Cash & Cash Equivalents as per Note 15 (A+B) 9,459.35 11,769.43

2 Interest paid is exclusive of and purchase of fixed assets is inclusive of interest capitalised 780.58 788.49

3 The above cash flow statement has been prepared under the "Indirect Method" as set out in the Accounting Standard - 3 on Cash Flow Statement issued by the Institute of Chartered Accountants of India.

4 Cash Flow Statement reflects the combined cash flows pertaining to continuing anddiscontinuing operations.

5 The previous year's figures have been regrouped wherever necessary.


For The Year ended on 31st Dec 2013

For The Year ended on 31st Dec 2012











1. SIGNIFICANT ACCOUNTING POLICIES:

1.1Basis of preparation of Financial Statements The Consolidated financial statements are prepared under the historical cost convention on the accrual basis of accounting, in accordance with the requirements of the Companies Act, 1956, including the accounting standards notified by the Central Government of India under Section 211 (3C) of the Companies Act, 1956.

1.2Principles of ConsolidationThe consolidated financial statements include the financial statements of Claris Lifesciences Limited (‘the Company’), and its subsidiaries as described in Note 23 (collectively referred to as ‘the Group’).

The consolidated financial statements have been prepared on the basis of Accounting Standard 21, ‘Consolidated Financial Statements’, issued by the Institute of Chartered Accountants of India.

The financial statements of the parent Company and its subsidiaries have been combined on a line- by- line basis by adding together the book values of like items of assets, liabilities, income and expenses after eliminating intra-group balances / transactions and resultant unrealized profits / losses in full. The amounts shown in respect of reserves comprise the amount of the relevant reserves as per the balance sheet of the parent Company and its share in the post-acquisition increase in the relevant reserves of the subsidiaries. The excess or deficit of parent’s portion of equity in the subsidiary Company over its cost of investment, if any, is treated as a capital reserve or recognized as goodwill respectively.

The consolidated financial statements are prepared using uniform accounting policies for like transactions and other events in similar circumstances except where it is not practicable to do so. Considering that the financial statements of the foreign subsidiaries have been prepared under the laws and regulations applicable to their respective country of incorporation, these consolidated financial statements have been prepared substantially in the same format adopted by the Company to the extent possible, as required by the Accounting Standard AS 21 “Consolidated Financial Statements” issued by the Institute of Chartered Accountants of India.

In case of foreign subsidiaries, revenue items are consolidated at the average rate prevailing during the period. All assets and liabilities are converted at the rates prevailing at the end of the period. Exchange gains/losses arising on conversion are recognized under Foreign Currency Translation Reserve.

The consolidated financial statements include the share of profit / loss of the associate companies which have been accounted for using equity method as per AS 23 Accounting for Investments in Associates in Consolidated Financial Statements. Accordingly, the share of profit/ loss of each of the associate companies ( the loss being restricted to the cost of investment) has been added to / deducted from the cost of investments.

1.3Use of estimatesThe preparation of financial statements, in conformity with the generally accepted accounting principles requires that the management makes estimates and assumptions that affect the reported amount of assets and liabilities, disclosure of contingent liabilities as at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. Difference between the actual results and estimates are recognized in the period in which the results are known / materialized.

1.4Fixed assetsFixed assets are capitalized at cost including all direct costs and other expenses incurred in connection with acquisition of assets and are net of refundable taxes and levies.

1.5DepreciationIndian Companiesi) Depreciation on Fixed Assets is provided on the straight-line method at the rates and in the manner prescribed under Schedule

XIV of the Companies Act, 1956 or at the rates based on estimated useful life whichever is higher. ii) Leasehold improvements are amortized over a period of 36 months. iii)Intangible assets are stated at cost and are amortized equally over a period of five years from the year in which incurred.

Foreign CompaniesDepreciation has been provided by the Foreign Companies on methods and at the rates required / permissible by the local laws so as to write-off assets over their useful life.



1.6GoodwillGoodwill arising on consolidation is not amortized but is tested for impairment periodically.

1.7InvestmentsLong-term investments are stated at cost. Any diminution in the value, other than temporary, is provided for. Current investments are carried individually, at lower of cost and fair value.

1.8InventoriesI) Inventories are valued at cost or net realizable value, whichever is less. ii) In case of Parent Company the cost (net of refundable taxes and levies) for raw materials and packing materials is computed on

Moving Average basis. iii) The cost of work in progress and finished goods is determined on absorption cost basis and comprises of cost of materials, direct

labour and manufacturing overheads.

1.9Revenue recognitiona. Sales include sales of products, dossiers and marketing rights. Sales include excise duty and exchange differences on sales

transactions, but are net of sales tax. Sales are recognized at the time when significant risks and reward of ownership in the goods are transferred.

b. Revenue in respect of other income is recognized when no significant uncertainty as to its determination or realization exists.

1.10 Employee benefitsContributions to provident and other funds accruing during the accounting period are charged to the Statement of profit and loss. Provision for liabilities in respect of gratuity and leave encashment are accrued and provided at the end of each accounting period on the basis of actuarial valuation.

1.11 Foreign currency transactionsTransactions denominated in foreign currencies are recorded at the exchange rate prevailing at the time of the transaction.

Monetary items denominated in foreign currencies at the year-end are restated at the year-end rates. In case of items, which are covered by forward exchange contracts, the difference between the year end rate and the rate on the date of contract is recognized as exchange difference and the premium paid on forward contracts is recognized over the life of the contract.

Non-monetary foreign currency items are carried at cost.

Any income or expense on account of exchange difference either on settlement or on translation is recognized in the profit and loss account, except, for the exchange differences arising on settlement or on translation of long-term foreign currency monetary items after 1st April 2011, so far as they relate to the acquisition of a depreciable capital asset, are added to or deducted from the cost of the asset and are depreciated over the balance life of the asset.

1.12 Research and development expensesRevenue expenditure on Research and Development is expensed as incurred. Expenses of capital nature are capitalized and depreciation is provided thereon as per the policy stated above.

1.13 Expenditure on product registrationExpenditure incurred for registration of products for overseas markets and for product acquisitions are charged to the profit & loss account.

1.14 Borrowing costsBorrowing costs consist of interest and other costs that the Group incurs in connection with the borrowing of funds and exchange differences arising from foreign currency borrowing to the extent that they are regarded as an adjustment to interest costs.

Borrowing costs that are attributable to acquisition / construction of qualifying assets are capitalized as part of cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to the profit & loss account

1.15 LeasesLease rentals in respect of assets taken on operating leases are charged to the profit and loss account on accrual and straight-line basis over the lease term.



1.16 Taxes on IncomeIndian CompaniesCurrent taxationCurrent tax provision is determined on the basis of taxable income computed as per the provisions of the Income Tax Act, 1961.

Minimum Alternate Tax (MAT) paid in accordance with the tax laws, which gives future economic benefits in the form of adjustment to future income tax liability, is considered as an asset if there is convincing evidence that the Company will pay normal income tax. Accordingly, MAT is recognised as an asset in the Balance Sheet when it is probable that future economic benefit associated with it will flow to the Company.

Deferred taxationDeferred tax is recognized for all timing differences that are capable of reversal in one or more subsequent periods, subject to consideration of prudence and by applying tax rates that have been enacted or substantively enacted as on the balance sheet date.

Foreign CompaniesForeign companies recognize tax liabilities and assets in accordance with the applicable local laws.

1.17 Provisions, Contingent Liabilities and Contingent AssetsProvisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognized but are disclosed in the notes to the financial statements. Contingent assets are neither recognized nor disclosed in the financial statements.



(Rupees in Lacs)


2. SHARE CAPITAL

Authorised 120,510,000 Equity Shares of Rs. 10 each 12,051.00 12,051.00

Issued, Subscribed, & Paid up :63,817,765 Equity Shares of Rs. 10 each fully paid-up - 6,381.78 6,381.78

6,381.78 6,381.78

(i) Reconciliation of number of equity shares outstanding at the beginning and at the end of the reporting year :

As at beginning of the year Nos. 63,817,765 63,817,765 Add: Issued during the year Nos. - - Outstading at the end of the year Nos. 63,817,765 63,817,765

(ii) Rights preferences and restrictions attached to equity shares

The Company has one class of equity shares having a face value of Rs. 10 per share. Each shareholder is eligible for one vote per equity share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders at the ensuing Annual General Meeting, In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion of their shareholding.

(iii) Shareholders holding more than 5% of total equity shares

Athanas Enterprise Private Limited Nos. 31,580,679 - % 49.49 -

First Carlyle Ventures III Nos. 7,111,095 7,111,095 % 11.14 11.14

Abellon Energy Limited Nos. 6,844,532 - % 10.73 -

Sarjan Financial Private Limited Nos. - 23,780,172 % - 37.26

Arjun Handa Nos. - 7,800,507 % - 12.22

Aditya S. Handa Nos. - 3,371,532 % - 5.28

Medical Technologies Limited Nos. - 4,653,120 % - 7.29

(iv) Details of bonus shares issued during last five years

Equity shares allotted as fully paid-up shares of Rs.10 each for a consideration other than cash pursuant to capitalisation of securities premium account

Nos. 17,061,763 17,061,763 during the financial year

ended December 31st, 2010

(v) The Board of Directors at their meeting held on 7th January, 2014 have, subject to the approval of shareholders by way of a Special Resolution through postal ballot and otherregulatory compliances required under applicable laws, recommended a proposal to buy back, on a proportionate basis, from the shareholders/beneficial owners of the equity shares of the Company as on the record date, up to 92,50,000 equity shares of the face value of Rs. 10 each (representing 14.49 % of the total equity share capital of the Company) at the price of Rs. 250 per equity share aggregating to Rs. 23,125 Lacs which is less than 25% of the aggregate of equity share capital and free reserves of the Company as per audited financial statements of the Company for the financial year ended December 31, 2012 through “Tender Offer” route as prescribed under the Securities and Exchange Board of India (Buy-Back of Securities) Regulations, 1998.


As at31-12-2013



(Rupees in Lacs)


3. RESERVES & SURPLUS

Capital redemption reserve 500.00 500.00

Securities premium accountOpening Balance 34,584.62 34,584.62 Add : Proportionate share in Associate Company 20,848.00 - Closing Balance 55,432.62 34,584.62

General reserveOpening Balance 5,267.70 4,702.70 Add : Transferred from surplus in the Statement of Profit and Loss 830.00 565.00 Closing Balance 6,097.70 5,267.70

Foreign currency translation reserve 6,432.31 3,448.93

Surplus / (Deficit) in the Statement of Profit and LossOpening Balance 64,703.67 56,360.96 Add : Net profit for the year 8,440.97 10,391.12 Less : Appropriations Proposed Interim Dividend [Rs.9 per share (Previous Year : Nil)] 5,743.60 - Proposed Dividend [Nil (Previous Year : Rs.2 per share)] - 1,276.35 Tax on Interim Dividend 976.12 207.06 Tax on Dividend of earlier year 9.86 - Transferred To General Reserve 830.00 565.00

Closing Balance 65,585.06 64,703.67 134,047.69 108,504.92

4. BORROWINGS

Secured:-Long-term borrowings, non-current portion

Term loans from banks External commercial borrowing-in Foreign Currency - 19,173.00 Rupee term loans 11,379.97 9,282.15 Vehicle loans 6.87 22.38

Term loans from Finance Companies Rupee term loan 1,293.91 1,410.00 Vehicle loan 2.19 7.13

12,682.94 29,894.66 Long-term borrowings, current portion

Term loans from banksRupee term loans 3,406.04 4,147.55 Vehicle loans 17.64 32.16

Term loans from Finance Companies Rupee term loan 120.00 90.00 Vehicle loan 4.94 7.41

3,548.62 4,277.12 Short-term borrowings

Cash Credit accounts 8,305.87 18,054.63 Buyers' credit 2,240.78 1,983.04

10,546.65 20,037.67 26,778.21 54,209.45


As at31-12-2013



(Rupees in Lacs)


5. DEFERRED TAX LIABILITIES ( NET )

Deferred tax liabilitiesDifference between book depreciation and depreciation under the Income-tax Act ,1961 ( IT Act ) 6,455.39 7,917.97

Deferred tax assetsDisallowances of provisions / expenses 406.92 455.64 Share issue expenses set off against share premium allowable under Section 35D of IT Act, 1961 in subsequent years 170.28 318.71

577.20 774.35 Net Deferred Tax Liability 5,878.19 7,143.62

6. OTHER LIABILITIES

Other long-term liabilitiesAdvances from customers - 133.53

Other current liabilitiesCurrent maturities of long-term debt 4 3,548.62 4,277.12 Interest accrued and due on borrowings 181.50 172.21 Interest accrued but not due on borrowings 105.01 474.92 Payables on purchase of fixed assets 1,663.02 1,212.75 Trade advances 2,112.65 4,067.81 Trade deposits 3,119.52 3,852.31 Unclaimed Share Application Money * 0.18 0.18 Unclaimed Dividend * 2.77 1.92 Advances from related parties 10,000.00 0.00 Payables to statutory and other authorities 311.71 416.66

21,044.98 14,475.88 21,044.98 14,609.41

*Note: There is no amount due and outstanding as at the Balance Sheet date to be credited to Investor Education and Protection Fund

7. PROVISIONS

Long-term provisionsProvision for employee benefits


641.50 932.89 Short-term provisions

Provision for employee benefitsGratuity 28 28.78 28.50 Leave benefits 28 34.16 32.00 Taxation (Net of payments) 2,256.55 467.18 Proposed dividend - 1,276.35 Proposed Interim Dividend 5,743.60 - Tax on Proposed Dividend 976.12 207.06

9,039.21 2,011.09 9,680.71 2,943.98

8. TRADE PAYABLES

Sundry creditorsMicro & small enterprise 108.19 77.59 Others 10,720.61 10,635.09

10,828.80 10,712.68


As at31-12-2013



Notes forming part of the Financial StatementsClaris Lifesciences Limited and its Subsidiaries

Sr.No.

Descriptionof Assets

Gross Block (At Cost) Depreciation / Amortisation Net Block

As at01-01-13

Additionsduring

the year

Deductionsduring

the year*

As at31-12-13

As at31-12-12

Upto01-01-13

For theYear

Deductionduring

the year*

Upto31-12-13

1,530.78 13,422.60

268.07

88,944.62 3,788.32

937.58 218.95 832.61 937.92

110,881.45 89,411.42

509.76 6,671.27

7,181.03 561.46

118,062.48 89,972.88

Exchange fluctuation

A123

456789

B

Tangible AssetsFreehold LandBuildingsImprovement to leasehold propertyPlant & MachineryElectrical InstallationFurniture & FixturesOffice EquipmentsVehiclesData ProcessingEquipmentsTotal (A)Previous Year

Intangible AssetsComputer Software Licensing & RegistrationTotal (B)Previous Year

TOTAL (A+B)Previous Year

(Rupees in Lacs)9. FIXED ASSETS

- 1,042.53

-

4,417.90 97.33

- 16.18 8.33

112.33

5,694.60 21,501.36

199.90 -

199.90 6,671.27

5,894.50 28,172.63

617.28 8,528.84

265.52

31,980.06 1,436.62

245.48 1.63

53.62 28.74

43,157.79 31.33

509.76

509.76 51.70

43,667.55 83.03

- -

0.03

(4.08) -

(0.99) 1.15 1.60 0.22

(2.07)

- 867.78 867.78

-

865.71

- 2,273.08

268.07

25,200.71 876.74 353.79 101.72 414.35 789.69

30,278.15 23,106.52

509.76 217.34 727.10 542.27

31,005.25 23,648.79

- 338.90

-

5,125.84 155.20 56.19 18.86 75.48 46.92

5,817.39 7,190.38

3.40 714.59 717.99 236.53

6,535.38 7,426.91

- 1,513.60

265.52

10,849.20 318.59 89.96 0.62

37.15 24.28

13,098.92 18.75

509.76

509.76 51.70

13,608.68 70.45

- 1,098.38

2.58

19,476.44 713.35 319.10 120.49 454.28 812.54

22,997.16 30,278.15

3.40 1,000.70

1,004.10 727.10

24,001.26 31,005.25

913.50 4,837.91

-

41,901.94 1,735.68

372.01 114.16 334.64 209.19

50,419.03 80,603.30

196.50 6,538.35

6,734.85 6,453.93

57,153.88 87,057.23

1,530.78 11,149.52

-

63,743.91 2,911.58

583.79 117.23 418.26 148.23

80,603.30 -

- 6,453.93 6,453.93

-

87,057.23 -

(Rupees in Lacs)

10. INVESTMENTS (AT COST)

1. Non-current Investments ( valued at cost ) , long term I. Trade

A. In Equity Instruments of Associate , unquoted(i) Claris Otsuka Limited 20,00,000 (Previous Year - Nil) Equity Shares of Rs. 10/- each fully paid-up. 200.00 - Add: Proportionate Share in Securities Premium 20,848.00 - Less: Share in Loss of Associate (99.87) -

20,948.13 - II. Non-Trade

A. In Equity instruments of other entities, unquoted(i) Indian Renal Foundation 1.94 1.94 19,400 Equity Shares of Rs. 10/- each fully paid

Total non-current 20,950.07 1.94

2. Current Investments

A. In Preference Shares of Other Entities, quoted(i) L&T Finance Holding Limited 1,000.00 -

10,00,000 (Previous Year - Nil )9% Cumulative Compulsorily Redeemable Preference Shares of Rs. 100 each, fully paid up

(ii) IL & FS Transportation Networks Ltd 1,000.00 - 50,00,000 (Previous Year - Nil) 10.53% Cumulative Non-Convertible Compulsorily Redeemable Preference Shares of Rs. 20 each, fully paid up

2,000.00 -

As at31-12-2013



As at31-12-13

913.50 5,936.29

2.58

61,378.38 2,449.03

691.11 234.65 788.92

1,021.73

73,416.19 110,881.45

199.90 7,539.05

7,738.95 7,181.03

81,155.14 118,062.48

Exchange fluctuation

- -

0.03

(0.91)

(0.92) 0.53 1.60 0.21

0.54

-

- 68.77

68.77 -

69.31

* Deductions include transfers on slump sale of Infusion business


(Rupees in Lacs)

B. In Bonds/Debentures of other entities , quoted(i) India Infrastructure Finance Company Limited 1,000.00 -

1,00,000 units (Previous Year - Nil ) of 8.50% Tax Free Secured, Redeemable, Non-Convertible Bonds of Rs. 1,000 each

(ii)India Infrastructure Finance Company Limited 1,000.00 - 1,00,000 units (Previous Year - Nil ) of 8.66% Tax Free Secured, Redeemable, Non-Convertible Bonds of Rs. 1,000 each

(iii) India Infoline Finance Limited 2,692.17 - 22,500 units (Previous Year - Nil ) of 11.50% Secured Redeemable Non- Convertible Debentures of Rs. 10,000 each

(iv) India Infoline Finance Limited 1,451.70 - 1,14,692 units (Previous Year - Nil ) of 11.70% Secured Redeemable Non Convertible Debentures of Rs. 1,000 each

6,143.87 -C. Investments in Mutual Funds

(i) 2,55,561.926 units (Previous Year - Nil ) of Reliance Liquid Fund 7,777.12 - (ii)65,22,965.128 units (Previous Year - Nil ) of HDFC Cash Management Fund 1,705.73 - (iii) 3,19,227.335 units (Previous Year - Nil ) of Religare Invesco Liquid Fund 5,500.00 - (iv) 30,00,000 units (Previous Year - Nil ) of IIFL-Short Term Income Fund 300.00 - (v) 21,96,595.277 units (Previous Year - Nil ) of HDFC Gilt Fund 500.00 - (vi) 36,52,487.709 units (Previous Year - Nil ) of IDFC Government Securities Fund 500.00 - (vii) 1,81,595.405 units (Previous Year - Nil ) of Principal Cash Management Fund 2,200.00 -

18,482.85 - D Other Investments

a) In Commercial Papers(I) 500 units (Previous Year - Nil ) of Tata Motors Finance Limited 2,372.72 - (ii)1,000 units (Previous Year - Nil ) of Shapoorji Pallonji & Company Limited 4,675.68 - (iii) 500 units (Previous Year - Nil ) of Religare Securities Limited 2,372.36 - (iv) 980 units (Previous Year - Nil ) of Reliance Capital Limited 4,637.01 - (v) 100 units (Previous Year - Nil ) of L&T Finance Holding Limited 480.39 - (vi) 1,500 units (Previous Year - Nil ) of JM Financial Products Limited 6,846.83 - (vii) 1,000 units (Previous Year - Nil ) of Edelweiss Financial Services Limited 4,528.48 - (viii) 1,000 units (Previous Year - Nil ) of Axis Finance Limited 4,813.53 -

30,727.00 - b) Pass Through Certificate

(I) 2,266 units (Previous Year - Nil ) of Shinning Metal Trust 1,528.27 -

c) Corporate Deposit with Infrastructure Leasing & Financial Services Limited 2,000.00 - 3,528.27 -

Total Current Investments 60,881.99 -

Total Investments 81,832.06 1.94

a. Aggregate amount in quoted investments 8,143.87 - b. Aggregate amount in unquoted investments 55,205.34 1.94 c. Aggregate amount invested in Mutual Funds 18,482.85 - d. Aggregate market value of quoted investments 8,263.47 - e. Aggregate market value of Mutual Funds 18,564.27 -

As at31-12-2013




(Rupees in Lacs)

11. LOANS AND ADVANCES

[Unsecured and considered good, unless otherwise stated]Non-current loans and advances

Capital advances 17,175.21 27,340.93 Security & tender deposits 966.88 702.45 MAT credit entitlement 1,155.50 520.46 Balance with government authorities - 118.19 Electricity and other deposits 169.53 170.07

19,467.12 28,852.10 Current loans and advances

Considered goodLoans and advances to related parties - 32.66 Balance with government authorities 1,076.65 770.04 Advances to suppliers 2,446.07 11,743.12 Advances recoverable in cash or kind 1,012.16 1,025.34

4,534.88 13,571.16 Considered doubtful

Loans and advances to related parties 32.66 - Less : Provision for doubtful advances 32.66 -

- - 4,534.88 13,571.16

24,002.00 42,423.26 12. OTHER ASSETS

[Unsecured and considered good, unless otherwise stated]

Other non-current assets Fixed deposit accounts {pledged with bank} - 126.00

Other current assetsInterest accruedOn Bonds 892.53 - On Fixed Deposits 51.70 87.21 On Others 219.07 81.99

1,163.30 169.20 1,163.30 295.20

13. INVENTORIES

Raw materials 1,107.27 1,631.86 Packing materials 902.35 1,448.53 Work in process 1,237.93 1,469.76 Finished goods 1,249.87 13,878.35

4,497.42 18,428.50

14. TRADE RECEIVABLES

(Unsecured)Exceeding six months from the date they became due

Considered good 5,291.70 5,762.00 Considered doubtful 33.26 32.02

5,324.96 5,794.02 Others

Considered good 10,359.57 17,061.17 10,359.57 17,061.17

Less : Provision for doubtful debts 33.26 32.02 15,651.27 22,823.17





(Rupees in Lacs)

15. CASH AND CASH EQUIVALENTS

Cash on hand 4.15 8.41 Cheques on hand - 84.00

Balances with scheduled banks :Current accounts 6,584.54 3,142.76 Margin money accounts 2,742.71 3,032.16 Fixed deposit accounts 125.00 5,500.00 Unclaimed share application money lying in escrow account 0.18 0.18 Unclaimed dividend account 2.77 1.92 9,455.20 11,677.02

9,459.35 11,769.43 16. REVENUE FROM OPERATION

SalesSales of products 66,791.43 77,622.98 Less : Excise duties 953.88 1,350.64

65,837.55 76,272.34 Operating incomeExport benefits 277.73 208.67 Income from Shared Services 448.01 - Sale of scrap 212.91 255.69

938.65 464.36 66,776.20 76,736.70

17 : OTHER INCOME

Interest Incomea. Interest from banks on :

(i) Deposits 316.85 419.54 (ii) Other balances 247.40 242.80

b. Interest income from current investments 2,655.59 - c. Others 55.16 18.17

3,275.00 680.51 Profit On Sales on Mutual Fund 519.87 - Sale of voluntary carbon reduction units 235.51 215.31 Provision for product recall no longer required written-back - 115.40 Miscellaneous income 28.37 18.27

4,058.75 1,029.49

18 : COST OF MATERIALS CONSUMED, PURCHASE OF STOCK IN TRADE

Raw materials consumed 9,311.93 14,526.63 Packing materials consumed 5,779.07 7,253.58

15,091.00 21,780.21 Purchase of goods traded-in 9,095.54 4,686.38

24,186.54 26,466.59 19 : CHANGES IN INVENTORIES OF FINISHED GOODS (WORK-IN-PROGRESS)

Stocks at the end of the yearWork-in progress 1,237.65 1,469.76 Finished goods 1,277.97 13,878.35

2,515.62 15,348.11 Stocks at the beginning of the yearWork-in progress 1,469.76 1,203.95 Finished goods * 1,564.75 12,726.11

3,034.51 13,930.06 518.89 (1,418.05)

*Opening stock of finished goods is after adjustment in respect of the slump sale of infusion business and other related agreements

20 : EMPLOYEE BENEFITS EXPENSE

Salaries, Wages, Bonus & Gratuity 4,825.25 4,931.88 Contribution to Provident and other funds 156.64 187.90 Staff Welfare 115.67 115.90

5,097.56 5,235.68





21 : FINANCE COST

Interest expense 4,029.13 5,107.55 Other borrowing cost 655.09 753.98 Bank charges 535.23 643.73

5,219.45 6,505.26 22 : OTHER EXPENSES

Conversion charges 131.13 408.33 Stores & spares consumed 994.02 652.97 Contract labour charges 1,074.10 1,272.85 Power & fuel 1,807.51 3,472.16 Insurance 145.99 145.99 Outward freight 5,704.61 4,462.77 Commission 789.25 690.15 Marketing and sales promotion expenses 1,986.93 1,922.64 Laboratory expenses 675.69 504.31 Travelling expenses 1,773.50 1,533.91 Stationery & printing 100.90 95.10 Communication expenses 246.67 223.42 Rent 386.80 414.02 Rates and taxes 54.71 68.77 Repairs to Building 128.66 85.78 Plant & machinery 176.12 210.32 Others 488.61 380.88 Bad debts written-off - 73.65 Provision for doubtful debts and advances 32.66 - Foreign exchange rate difference (Net) 1,188.76 192.58 Excise duty (73.71) 63.29 Consultancy fees 756.77 1,513.16 Legal fees & charges 254.24 276.36 Professional charges 131.64 127.86 General charges 1,051.41 1,169.46 Donations 27.59 10.95

20,034.56 19,971.68



Name of the Company

Subsidiary CompaniesiCubix Infotech LimitedClaris Lifesciences International Limited Ogen Nutrition LimitedClaris Infrastructure LimitedClaris Produtos Farmaceuticos do Brasil Ltda.PT. Claris Lifesciences IndonesiaClaris Lifesciences Colombia Ltda.Catalys Venture Cap LimitedClaris Lifesciences Venezuela C. A.Claris Lifesciences Inc.Claris Lifesciences (UK) LimitedClaris Lifesciences & Cia. Chile LimitadaClaris Lifesciences (Aust) Pty LimitedClaris Lifesciences de Mexico S.A. de C.V.Claris Lifesciences Philippines, INC.Claris SteriOneClaris PharmaservicesClaris Otsuka Limited ( Upto 31st July, 2013)Associate CompanyClaris Otsuka Limited (from 1st August, 2013)

Country of Incorporation

IndiaIndiaIndiaIndiaBrasil

IndonesiaColombiaMauritiusVenezuela

USAUK

ChileAustralia

MexicoPhilippinesMauritiusMauritius

India

India

% of Holding either directly or indirectly or through

subsidiary as at 31-12-2013

100100100100100100100100100100100100100100100100100

-

20

% of Holding either directly or indirectly or through

subsidiary as at 31-12-2012

100100100100100100100100100100100100100100100100100100

-

23. Description of the Group The following subsidiary companies are considered in the consolidated financial statements.


(Rupees in Lacs)

(Rupees in Lacs)25. Commitments & ObligationsAs at

31-12-2013

17,971.87

1,860.45

As at31-12-2012

3,736.79

7,622.07

a. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of capital advances)b. Outstanding obligation to export goods worth Rs. 6,692.54 Lacs (Previous year Rs. 36,959.47 Lacs) within the stipulated period as per Export Promotional Capital Goods Scheme, failing which additional custom duty payable would amount to

26. Capital Work In Progress includes preoperative expenditure pending allocation to a project under implementation as under

(Rupees in Lacs)

As at31-12-2013

1367.41 805.86 26.96 81.17 2246.55 9.72

(4,067.28) 470.39

As at31-12-2012

820.81788.49

37.70-

504.329.44

(793.35)1,367.41

Preoperative Expenses

Opening balanceAdd: Interest and finance charges Consultancy / Professional Fee Personnel Cost Foreign Exchange Rate Difference Other Expenses Less: Capitalized during the year Closing balance

(Rupees in Lacs)For the Year ended

on 31-12-2013

13.814,050.18

3.294,067.28


-793.35

-793.35

Fixed Asset

BuildingPlant & MachineryElectrical InstallationTotal

Details of Preoperative expenses capitalized during the year:

27.Pursuant to notification dated 29th December, 2011 issued by Central Government under Companies (Accounting Standard) Amendment Rules, 2009; with effect from April 1, 2011, the Company has exercised the option whereby, the exchange differences arising on settlement or on translation of long- term foreign currency monetary items, so far as they relate to the acquisition of a depreciable capital asset, are added to or deducted from the cost of the asset and are depreciated over the balance life of the asset.


on 31-12-2013

2,246.55-


504.32958.95

Amount added/(reduced) from capital assetsAmount remaining to be depreciated

(Rupees in Lacs)28 . Employee Benefits a. Defined Benefits Plans:

i. Expenses recognized in Profit & Loss Account for the year ended on 31st December

Short provision made in the books Current service costInterest CostExpected return on plan assetsNet actuarial losses (gains)Total Expenses

Gratuity2013

-56.6536.18

-(46.76)46.07

Leave Encashment2013

-41.8939.67

-(39.67)41.89

2012

0.4764.0329.47

-121.44215.41

2012

1.1283.7933.32

-(12.29)105.94


24. Contingent Liabilities

a. Claims against the Company not acknowledged as debts b. Disputed demand under : (I) Income Tax (ii) Sale tax (iii) Excise Duty (iv) Regulatoryc. Guarantees given by the bankers on behalf of the Companyd. Bills discountede. Letters of credit outstanding

As at31-12-2013

2,516.24

534.988.93

85.7410,400.00

600.553,275.94

161.12

As at31-12-2012

2,235.90

392.278.93

87.78104,00.00

509.593,905.61

851.10

(Rupees in Lacs)


ii. Reconciliation of Closing balances of changes in present value of the Defined Benefit Obligation

Opening defined benefit obligation Service CostInterest CostActuarial losses (gains)Losses (gains) on curtailmentsLiabilities extinguished on settlementsBenefits paidClosing defined benefit obligation

471.8256.6536.18

(46.76)--

(40.78)477.11

414.2983.7933.32

(12.29)--

(47.29)471.82

521.5741.8939.67

(39.67)--

(53.11)510.35

384.2164.0329.47

121.44-

-(77.58)521.57

Gratuity2013

Leave Encashment2013 20122012

iii. Reconciliation of Opening and Closing balances of changes in fair value of plan assets

Opening fair value of plan assets Expected return on plan assetsActuarial gains and (losses)Assets distributed on settlementsContributions by employerBenefits paidClosing balance of fair value of plan assets

-------

-------

-------

-------

iv. Net Liability recognized in the Balance sheet

Defined Benefit Obligation Fair value of plan assets Present Value of unfunded obligation recognized as liability

477.11

477.11

471.82

471.82

510.35

510.35

521.57

521.57

v. Past four years data for define benefit obligation and fair value of plan assets are as under:

GratuityDefined Benefit Obligation Fair value of plan assets Present Value of unfunded obligation recognized as liability Leave EncashmentDefined Benefit Obligation Fair value of plan assets Present Value of unfunded obligation recognized as liability

2012

471.82

471.82

521.57

521.57

2011

414.30

414.30

384.20

384.20

2010

380.93

380.93

365.50

365.50

2009

300.50

300.50

247.60

247.60

for the year ended 31st December,

Discount RateExpected rate of salary increaseMortalityWithdrawal RatesRetirement AgeActuarial Valuation Method

31-12-2013

9.30%6.00%Indian Assured Lives Mortality (2006-08) Ult.3% younger ages reducing to 1% at old ages58 YearsProjected Unit Credit Method

31-12- 2012

8.00%6.00%LIC (1994-96) published table of mortality rates3 % younger age reducing to 1 % old age58 YearsProjected Unit Credit Method

vi. Actuarial Assumptions

b. Defined Contribution PlansRs. 129.82 lacs (Previous Year Rs. 158.35 lacs) is recognized as an expense in respect of Defined Contribution Plans and is included in the Note No.20 forming part of Statement of Profit and Loss under the head “Contribution to Provident and other funds.

29. Segment Information

(i) Primary Segment:In accordance with the requirements of Accounting Standard –17 on Segment Reporting, the Group has determined its business segment as “Drugs and Pharmaceuticals”. Since all of the Group’s business is from “Drugs and Pharmaceuticals’, there are no other primary reportable segments. Thus the segment revenue, segment result, total carrying amount of segment liabilities, total cost incurred to acquire segment assets, the total amount of charge for depreciation during the year are all reflected in the consolidated financial statements as at and for the year ended 31st December, 2013.

(Rupees in Lacs)



Revenue

Carrying amounts of segment asset

Capital expenditure

(ii) Secondary Segment (Geographical Segment)

India

22,010.53 (35,601.11)

1,81,509.43(166,553.98)

5,796.18 (34,746.73)

Outside India

43,827.02(40,671.23)

29,582.31(33,674.74)

- (6,671.27)

Total

65,837.55(76,272.34)

2,11,091.74(200,228.72)

5,796.18 (41,418.00)

(Rupees in Lacs)

Note: Figures in brackets are in respect of previous year.


A. Associate CompanyClaris Otsuka Limited

B. Companies in which Key Management Personnel or their relatives are able to exercise significant influence Sarjan Financial Private Limited Medical Technologies LimitedAccelaries Technologies LimitedEnthrills Infotech Limited

C. Key Management PersonnelMr. Arjun HandaMr. Chetan S. MajmudarMr. Amish P. VyasMr. Chandrasingh S. Purohit

D. Relatives of Key Management PersonnelMr. Aditya S. Handa

30. Related party disclosures as required by Accounting Standard 18, ” Related Party Disclosures”, issued by the Institute of Chartered Accountants of India are given below.

(A) Particulars of related parties and nature of relationships:



(Rupees in Lacs)

For the Year ended on

31-12-2013


31-12-2012


a) Nature of Transactions1. Sales

To AssociatesClaris Otsuka Limited 1,740.26 -

2. Sale of AssetsTo Associates


3. Services RenderedTo Associates Claris Otsuka Limited 1,219.94 -

4. PurchasedFrom Associates


5. Expense Reimbursed To Associates Claris Otsuka Limited 915.08 -

6. Remuneration Paid To Key Management Personnel Mr. Arjun Handa 150.59 150.59 Mr. Chandrasingh S. Purohit 47.59 36.59 Mr. Amish P. Vyas 47.59 36.59 Mr. Chetan S. Majmudar 47.59 36.59

7. Dividend PaidTo Key Management Personnel Mr. Arjun Handa 156.01 156.01

To Companies in which Key Management Personnel or their relatives are able to exercise significant influence

Sarjan Financial Private Limited 475.60 475.60Medical Technologies Limited 93.06 93.06

To Relative of Key Management PersonnelMr. Aditya S. Handa 67.43 134.01

8. Received on Slump SaleFrom Associates

Claris Otsuka Limited 1,05,040.00 -

9. Doubtful debts/Advances Provided for the yearFrom Companies in which Key Management Personnel or their relatives are able to exercise significant influence

Accelaries Technologies Limited 17.32 -Enthrills Infotech Limited 15.34 -

10. Investment made during the yearClaris Otsuka Limited 195.00 -


1. Lease payments recognized in the profit and Loss account for the year

2. Minimum lease payments under the agreements are as follows. a) Not later than one year b) Later than one year but not later than 5 Year c) Later than five year


on 31-12-2013

299.14

298.991242.17734.86


276.31

215.37861.37188.55

31. Disclosures for operating leases under Accounting Standard 19 – “Accounting for Leases” The company has entered into agreements for taking on leave and license basis residential / office premises including furniture and fittings

therein, as applicable, for a period ranging from 11 to 60 months. The specified disclosure in respect of these agreements is given below:

Basic & Diluted EPSComputation of Profit (Numerator) (i)Net Profit for the year from Continuing Operations (ii) Net Profit for the year from Total Operations

Weighted Average Number of Shares (Denominator)Weighted average number of Equity shares of Rs.10 each used for calculation of Basic Earning Per ShareBasic & Diluted EPS (in Rs.) (i) Continuing Operations (ii) Total OperationsFace value per share (in Rs.)* Refer Note 37 ( c )

(Rupees in lacs, except per share data)


4.340.328440.97

Nos.

63,817,765

6.8013.2310.00


*10,391.12

Nos.

63,817,765

*16.2810.00

32. Computation of Earnings per Share (EPS):


(Rupees in Lacs)


31-12-2013


31-12-2012

b) Balance at the end of the year1. Outstanding Payables

To Companies in which Key Management Personnel or their relatives are able to exercise significant influence

Accelaries Technologies Limited 0.20 0.20

2. Outstanding Receivables From Associates


3. Advances Received Outstanding To Associate Companies


4. Advances Granted Outstanding Net of provision for DoubtfulFrom Companies in which Key Management Personnel or their relatives are able to exercise significant influence Accelaries Technologies Limited - 17.32

Enthrills Infotech Limited - 15.34From Key Management Personnel

Mr. Amish P. Vyas 3.79 1.74Mr. Chetan S. Majmudar 7.58 7.21Mr. Chandrasingh S. Purohit - 4.98

5. Provision for doubtful AdvancesAccelaries Technologies Limited 17.32 -Enthrills Infotech Limited 15.34 -

6. Investments Balance at the end of the period( net of Provision for Diminution in value)From Associate Companies

Claris Otsuka Limited 200.00


# For the period from 1st January 2013 to 31 July 2013 / as at 31st July 2013.* As per disclosures made in the financial statements for the previous financial year ended on 31st December 2012.

c) The Company operates under a single business segment i.e. ‘Drugs & Pharmaceuticals’ as per the requirements of Accounting Standard – 17 ‘Segment Reporting’. The transfer of the infusion business involved transfer of assets and liabilities as are related to the infusion business and as the same are identified by the parties to the transaction. For this purpose, the products, employees, tangible and intangible assets, current assets, market territories, long term and short term borrowings, other liabilities etc. have been identified as are related to the infusion business. In view of common employees, marketing expenses, logistics and distribution arrangements and general corporate overheads, which are not separately identifiable for identified products of the infusion business being transferred, the Company is unable to determine the income and expenses clearly attributable to the discontinued operations. As per the practice followed by the Company for preparation of its financial statements for financial reporting purposes, its present system of maintenance of books of account and other relevant records does not provide clearly identifiable details of income and expenditure as are related to the infusion business. Under the facts and circumstances, for the period from 1st January 2013 to 31st July, 2013, the Company has disclosed separately the figures for expenditure attributable to discontinuing operations, profit from the continuing and from the discontinuing operations, tax expense of discontinuing operations, profit from discontinuing operations (after tax) and cash flows from operating activities on best estimate basis. However, such figures for the previous corresponding year are not available and hence not disclosed.

d) In view of the above stated transfer of infusion business, the figures for the financial year reported in the statement of profit and loss and the cash flow statement do not include the figures of the infusion business for the period from 1st August, 2013 to 31st December 2013 and the figures in the balance sheet as at 31st December 2013 do not include the figures pertaining to the infusion business. Under the circumstances, the same are not comparable with the corresponding previous year figures which included figures for the infusion business for the whole of the previous year.

34. Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure.

In terms of our report attached For Deloitte Haskins & SellsChartered Accountants



For and on behalf of Board of DirectorsArjun HandaManaging Director & CEO





Particular

RevenueExpenditureProfit Before taxProfit after taxTotal AssetsTotal LiabilitiesCash flow (used in)/from Operating activitiesCash flow (used in)/from Investing activities Cash flow (used in)/from Financing activities

(Rupees in Lacs)For the year ended on

31st Dec 2013#22,055.7319,097.112,958.622,074.10

91,650.781,857.585,113.40

0.00(1,121.00)

For the year ended on 31st Dec 2012*

42,854.56Refer note (C)Refer note (C)Refer note (C)

73,630.105,845.03

Refer note (C)(9,678.13)

3,357.32

33. Discontinuing operationsOn December 7, 2012,the management of the Company entered in to certain agreements with Otsuka Pharmaceutical Factory, Inc., Japan (‘Otsuka’) and Mitsui & Co. Ltd., Japan (‘Mitsui’) for transfer of its Infusion Business to Claris Otsuka Limited on ‘slump sale’ basis. The said infusion business includes identified products of Common Solutions, Anti Infective, Plasma Volume Expanders and Parenteral Nutrition in India and in Emerging markets (herein after referred to as ‘the infusion business’). The Board of Directors of the Company, in its meeting held on December 7, 2012 had passed necessary resolutions approving the transfer of the infusion business to Claris Otsuka Limited and upon getting the necessary approvals from the shareholders, through postal ballot on 18th February, 2013 and after getting approvals from statutory and regulatory authorities, the transfer of the infusion business was completed on 31st July, 2013.

a) As per the terms of the agreements, the Company has received Rs. 103,182.42 lacs (Rs. 105,040.00 lacs less Rs. 1,857.58 lacs for liabilities transferred) as consideration for the net assets of the infusion business transferred in favor of Otsuka and Mitsui, who have, in effect, subscribed towards equity share capital and towards Securities Premium of Claris Otsuka Limited, pursuant to which, Otsuka, Mitsui and the Company respectively hold 60 %, 20% and 20% of the equity share capital of Claris Otsuka Limited. The purchase consideration includes Rs. 30,000 Lacs towards transfer of intangible assets which are recognised by the Company as and when the Intangible assets are transferred in the name of Claris Otsuka Limited. The pre-tax gain on disposal of assets and settlement of liabilities attributable to the sale of the infusion business of Rs. 1,505.98 lacs (net of deal related expenses of Rs. 1,883.22 lacs) has been disclosed in the statement of profit and loss as an exceptional item, being profit on disposal of infusion business under slump sale. The income tax expense in this respect relating to the capital gain tax of Rs. 2,264.64 lacs and reversal of deferred tax liability of Rs. 2,885.18 lacs have been included in the current tax and deferred tax amounts respectively in the statement of profit and loss.

b) Necessary disclosures of the details pertaining to the discontinuing operations in respect of the infusion business and the reorganization thereof as stated above, as required under the Accounting Standard – 24 ‘Discontinuing Operations’ (AS-24) as notified by the Government of India under Section 211(3C) of the Companies Act, 1956,are as under : -


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,763

424

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7,2

92,0

00

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12,9

48

14,

119,

537

41,

595,

510

18,

569

84,

465,

129

42,

176,

141

70,

096,

485

72,

519,

139

20,

402

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175

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150

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Inve

stm

ents

mad

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idia

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-

-

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-

747

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,585

-

-

-

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-

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427

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287

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3,7

15,3

97

5,4

29,9

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192

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Prof

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re

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101

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(1,4

73,6

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(2,6

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5,4

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3,6

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360) -

-

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678

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(14,

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(46,

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(57,

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643

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548

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72

(60,

500,

360) -

-

(10,

319,

638)

34,

664

(12,

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792) -

(14,

799)

(3,0

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25)

(46,

316)

(1,9

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90)

(57,

193)

Nam

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PT C

laris

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Not

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bas

ed o

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e ex

chan

ge ra

tes

as o

n 31

-12-

2013

87

Clar

is L

ifesc

ienc

es L

imite

d -

Annu

al R

epor

t 20

13

Statement pursuant to section 212 of the Companies Act, 1956 Relating to Subsidiary Companies

Claris Produtos Farmaceuticos

Do Brasil Limitada

R$

31-Dec-2013

4,642,248.46 quotas of

Real 1 each

1100%

3,894,666

(7,922,771)

NIL

NIL

Name of the Subsidiary Company

Currency of Presentation

Financial year of the Subsidiary Company ended on

Holding Company's interest - No. of equity share

- Percentage (%) of Holding.

The net aggregate amount of the Subsidiary's Profit / Loss so far as it concerns the members of the Holding Company not dealt within the Holding Company's Account- For the Current Financial year

- For the Previous Financial year since it became subsidiary.

The net aggregate amount of Profit / Loss of the Subsidiary which has been dealt within the account of the Holding Company - For the Current Financial year


Information on the financials of the Subsidiary Companies

Claris Lifesciences

Colombia Limitada

COL Pesos

31-Dec-2013

271,661 Social Quotas of

COL Pesos 1,000 each

2100%

(45,908,000)

(1,026,666,288)

NIL

NIL

Claris Lifesciences de Mexico SA de CV

Mexican Pesos

31-Dec-2013

50 shares of Mexican Pesos

1,000 each

3100%

(567,480)

(18,066,125)

NIL

NIL

Claris Lifesciences & CIA Chile

Limitada

Chilian Pesos

31-Dec-2013

100 % ofSocial Rights

4100%

46,126,617

1,251,869,705

NIL

NIL

1. 4,642,248.46 quotas of Real 1/- each are held by Claris Lifesciences Limited and 3,324,111.54 quotas of Real 1/- each are held by Catalys Venture Cap Limited.

2. 271,661 Social Quotes of COL Pesos 1,000 each are held by Claris Lifesciences Limited, 15,811 Social Quotes of COL Pesos 1,000 each are held by Claris Lifesciences International Limited and 2,100,000 Social Quotes of COL Pesos 1,000 each are held by Catalys Venture Cap Limited.

3. 50 Common registered Shares (Fixed Capital) of Mexican Pesos 1,000 each are held by Claris Lifesciences Ltd. And 68,000 Common registered Shares (Variable Capitat) of Mexican Pesos 1,000 each at Par Value, are held by Catalys Venture Cap Limited.

4. 85,500,000 Chilean Pesos equivalent to 95.00% of Social Right by Claris Lifesciences Limited and 4,500,000 Chilean Pesos equivalent to 5% of Social Right by Claris Lifesciences International Limited.



Claris Lifesciences Venezuela C.A.

Bolivar Fuerte(Bs.F)

31-Dec-2013

1,000 Common Share of Bolivar Fuerte 1 each

100%

368,152

374,839

NIL

NIL











Catalys Venture Cap Limited

USD

31-Dec-2013

11,40,600 Ordinary Shares of

US $ 1 each

100%

(977,436)

44,085,163

NIL

NIL

Claris Pharmaservices

USD

31-Dec-2013

-

st1

-

-

NIL

NIL

Claris SteriOne

USD

31-Dec-2013

-

st2

-

(300)

NIL

NIL

1. 4,642,248.46 quotas of Real 1/- each are held by Claris Lifesciences Limited and 3,324,111.54 quotas of Real 1/- each are held by Catalys Venture Cap Limited.

2. 271,661 Social Quotes of COL Pesos 1,000 each are held by Claris Lifesciences Limited, 15,811 Social Quotes of COL Pesos 1,000 each are held by Claris Lifesciences International Limited and 2,100,000 Social Quotes of COL Pesos 1,000 each are held by Catalys Venture Cap Limited.

3. 50 Common registered Shares (Fixed Capital) of Mexican Pesos 1,000 each are held by Claris Lifesciences Ltd. And 68,000 Common registered Shares (Variable Capitat) of Mexican Pesos 1,000 each at Par Value, are held by Catalys Venture Cap Limited.

4. 85,500,000 Chilean Pesos equivalent to 95.00% of Social Right by Claris Lifesciences Limited and 4,500,000 Chilean Pesos equivalent to 5% of Social Right by Claris Lifesciences International Limited.



PT. Claris Lifesciences Indonesia

Indonesia Rupiah

31-Dec-2013

100,000 Share of Indonesia Rupiah 9108 per share

100%

(2,023,458,480)

(6,369,821,422)

NIL

NIL











Claris Lifesciences

Philippines, INC.

Philippines Pesos

31-Dec-2013

102,000 Shares of Philippine Pesos

100 each

100%

24,940

(11,891,144)

NIL

NIL

Claris Lifesciences

Inc.

USD

31-Dec-2013

200 Shares of USD 1 each

1100%

(204,530)

(1,162,233)

NIL

NIL

Claris Lifesciences (Aust) Pty Ltd

AUD

31-Dec-2013

100 Ordinary Shares of AUD

1 each

100%

(270)

53

NIL

NIL

1. 200 Shares of USD 1 each at Par Value are held by Claris Lifesciences Ltd, and 4,350,000 Shares of USD 1 each at Par Value are held by Catalys Venture Cap Limited.

Claris Lifesciences (UK) Limited

GBP

31-Dec-2013

100 Ordinary Shares of GBP

1 each

100%

- -

NIL

NIL



Icubix Infotech Limited

INR

31-Dec-2013

50,000 Equity Shares of Rs. 10 each

100%

(3,072,425)

5,352,874

NIL

NIL











Claris Lifesciences International Limited

INR

31-Dec-2013

50,060 Equity Shares of

Rs. 10 each

100%

(46,316)

(807,557)

NIL

NIL

Ogen Nutrition Limited

INR

31-Dec-2013


Rs. 10 each

100%

(1,945,590)

(1,311,030)

NIL

NIL

Claris Infrastructure

Limited

INR

31-Dec-2013


Rs. 10 each

100%

(57,193)

(511,395)

NIL

NIL


Notes


Notes


Notes


PROXY FORM[Pursuant to section 105(6) of the Companies Act, 2013 and rule 19(3) of the Companies (Management and Administration) Rules, 2014]

CLARIS LIFESCIENCES LIMITEDRegistered Office : Claris Corporate Headquarters, Nr. Parimal Railway Crossing, Ellisbridge, Ahmedabad-380006, India.

Tel: +91-79-26563331, 66309330 Website: www.clarislifesciences.com CIN: L85110GJ1994PLC022543

Name of the Member

Registered Address

Email ID

Folio No. / Client ID

DP ID.

I/We being the member(s) of __________________, shares of the above named company, hereby appoint

1. Name:_ _________________________________________________________________________________________________________Address:_ __________________________________________________________________________________________________________ ________________________________________________________________________________________________________________E-mail ID:_ ________________________________________________________________________________________________________

Signature:________________________________, or failing him/her





as my/our proxy to attend and vote (on a poll) for me/us and on my/our behalf at the Ninteenth Annual General Meeting of CLARIS LIFESCIENCES LIMITED, to be held on Tuesday, June 17, 2014 at 11.00 AM at Ahmedabad Management Association, J.B Auditorium, ATIRA Campus, Dr. Vikram Sarabhai Marg, Ahmedabad 380 015, Gujarat and/or any adjournment thereof in respect of such resolutions as are indicated below:

Resolutions No.1. ______________________________________ 2. ______________________________________3. ______________________________________ 4. ______________________________________5. ______________________________________ 6. ______________________________________7. ______________________________________ 8. ______________________________________

Signed this___________________________day of_______________________2014

Signature of shareholder

Signature of Proxy holder(s)

Note: This form of proxy in order to be effective should be duly completed and deposited at the Registered Office of the Company, not less than 48 hours before the commencement of the Meeting.


Affix RevenueStamp

CLARIS LIFESCIENCES LIMITED

Registered Office : Claris Corporate Headquarters, Nr. Parimal Railway Crossing, Ellisbridge, Ahmedabad-380006, India.

Tel: +91-79-26563331, 66309330 Website: www.clarislifesciences.com CIN: L85110GJ1994PLC022543

ATTENDANCE SLIP

Only Shareholders or the Proxies will be allowed to attend the meeting

Regd. Folio/DP ID

& Client ID

Number of Shares

Held

Name and Address

of the Shareholder

I/We hereby record my/our presence at the Nineteenth Annual General Meeting of CLARIS LIFESCIENCES LIMITED held

on Tuesday, June 17, 2014 at 11.00 AM at Ahmedabad Management Association, J.B Auditorium, ATIRA Campus, Dr.

Vikram Sarabhai Marg, Ahmedabad 380 015, Gujarat and/or any adjournment thereof.

……………………………………………..

Signature

Note :

1. Shareholders attending the meeting in person or through proxy are requested to complete the Attendance Slip and

hand it over at the attendance verification counter at the entrance of Meeting hall.

2. Bodies Corporate, whether a company or not, who are members, may attend through their authorised

representatives appointed under Section 113 of the Companies Act, 2013. A copy of authorisation should be deposited

with the Company.

3. Electronic copy of the Annual Report for 2013 and Notice of the Annual General Meeting (AGM) longwith attendance

slip and proxy form is being sent to all the members whose email address is registered with the Company/ Depository

Participant unless any member has requested for a hard copy of the same. Members receiving electronic copy and

attending the AGM can print copy of this Attendance Slip.

4. Physical copy of the Annual Report for 2013 and Notice of the AGM along with the attendance slip and proxy form is

sent in the permitted mode(s) to all members whose email is not registered or have requested for a hard copy.

__________________________________________________________________________________________

E-Voting Information

The electronic voting particulars are set out below:

EVSN (Electronic Voting Sequence

Number)

USER ID PASSWORD

Please refer Notice for instructions on e voting.

E-voting facility is available during the following voting period

Commencement of e-voting End of E-voting

Tuesday, June 10, 2014 (6:00 am) Thursday, June 12, 2014 (12:00 pm)

Documents

AR 2013 Title Letter size copy - Claris Lifesciences Limited Report 2013... · Management Discussion & Analysis 24 Standalone Financial ... Punjab National Bank ... 2013 and Statement