46. Provisions
Accounting Policies

A provision is recognized if, as a result of a past event, the
Company has a present legal or constructive obligation that
can be estimated reliably, and it is probable that an outflow of
economic benefits will be required to settle the obligation. If the
effect of the time value of money is material, provisions are
determined by discounting the expected future cash flows at a
pre-tax rate that reflects current market assessments of the
time value of money and the risks specific to the liability. Where
discounting is used, the increase in the provision due to the
passage of time is recognized as a finance cost.

The amount recognized as a provision is the best estimate of
the consideration required to settle the present obligation at
the reporting date, considering the risks and uncertainties
surrounding the obligation. When some or all the economic
benefits required to settle a provision are expected to be
recovered from a third party, the receivable is recognized as an
asset if it is virtually certain that reimbursement will be received,
and the amount of the receivable can be measured reliably.

A contract is considered to be onerous when the expected
economic benefits to be derived by the Company from the
contract are lower than the unavoidable cost of meeting its
obligations under the contract. The provision for an onerous
contract is measured at the present value of the lower of the
expected cost of terminating the contract and the expected net
cost of continuing with the contract. Before such a provision is
made, the Company recognizes any impairment loss on the
assets associated with that contract.

Provisions are reviewed at each balance sheet date and
adjusted to reflect the current best estimate. If it is no longer
probable that the outflow of resources would be required to
settle the obligation, the provision is reversed.

47. Segment Reporting

i) Primary Segment (Business Segment)

The Company operates only in the business segment of
“Pharmaceuticals Products”, and in the opinion of the
management the inherent nature of activities in which it is
engaged are governed by the same set of risks and rewards.
As such the activities are identified as single segment in
accordance with the Indian Accounting Standard (Ind AS 108)
issued under Companies (Indian Accounting Standards) Rules,
2016 as amended up to date.

In view of the interwoven/intermix nature of business and
manufacturing facility, other segmental information is not
ascertainable.

iii) Revenue from Major Customers

Revenue from one customer of the company pharmaceutical
segment represented approximately ' 1,262.72 million (Previous
year ' 2,274.08 million) of the company’s total revenue.

48. Other Borrowing Costs

Other Borrowing Costs include gain on account of foreign
exchange fluctuation (net) amounting to ' 85.27 million (Previous
Year ' 97.50 million).

Accounting Policies

Borrowing costs that are attributable to the acquisition or
construction of qualifying assets are capitalized. Other borrowing
costs are recognized as an expense in the period in which they
are incurred.

49. Leases

Operating leases are mainly in the nature of lease of office
premises with no restrictions and are renewable/cancellable at
mutual consent. There are no restrictions imposed by lease
arrangements. There are no sub leases. Lease payments
recognized in the Statement of Profit and Loss Account are
' 20.31 million (Previous Year ' 18.89 million).

Accounting Policies

Basic earnings per share is calculated by dividing the net profit
or loss for the period attributable to equity shareholders by the
weighted average number of equity-shares outstanding during
the period.

Diluted earnings per share is calculated by dividing the net profit or
loss for the period attributable to equity shareholders by the weighted
average number of equity-shares outstanding during the year after
adjusted for the effects of all dilutive potential equity shares.

54. Related Party Disclosures

Related party disclosures as required under Indian Accounting
Standard (Ind AS 24) on “Related Party Disclosures” issued
under Companies (Indian Accounting Standards) Rule 2016,
as amended up to date, are given below: -

a) Relationship

i) Subsidiary Companies

• Neclife PT, Unipessoal LDA - Portugal (Inoperative during
the year)

ii) Key Management Personnel

• Mr. Sanjiv Goyal, Chairman & Managing Director

• Mr. Puneet Sud, Whole-time Director

• Mr. Amit Chadah, Chief Executive Officer

• Mr. Sushil Kapoor, Chief Financial Officer

• Ms. Neha, Company Secretary (upto 28.02.2025)

• Mr. Sanjaymohan Singh Rawat, Company Secretary (w.e.f.
01.04.2025)

iii) Joint Ventures and Associates

• None

# The matters are subject to legal proceedings in the ordinary
course of business. In the opinion of the management, legal
proceedings for cases, when ultimately concluded, will not have
a material effect on the results of operation or financial position
of the company.

** MAT credit entitlement would be reduced by ' 580.98 million,
in case of adverse judgment and ' 299.00 million will be adjusted
against the MAT credit entitlement already lapsed in the books
of accounts.

@Amount deposited under protest ' 25.62 million.

# Amount deposited under protest ' 0.52 million.

# In case demand is confirmed, penalty up to equivalent amount
may be imposed.

$ Amount deposited under protest “Nil” (Previous year ' 3.44
million).

Interest and claims by customers, suppliers, lenders, and
employees may be payable as and when the outcome of the
related matters is finally determined and hence have not been
included above. Management based on legal advice and
historical trends, believes that no material liability will devolve
on the Company in respect of these matters.

Accounting Policies

A contingent liability is a possible obligation that arises from
past events whose existence will be confirmed by the occurrence
or non-occurrence of one or more uncertain future events
beyond the control of the Company or a present obligation that
is not recognised because it is not probable that an outflow of
resources will be required to settle the obligation.

A contingent liability also arises in extremely rare cases where
there is a liability that cannot be recognised because it cannot
be measured reliably. The Company does not recognise a
contingent liability but discloses its existence in the financial
statements unless the possibility of an outflow of resources
embodying economic benefits is remote. Contingent liabilities
and commitments are reviewed by the management at each
balance sheet date.

Contingent assets are neither recognised nor disclosed in the
financial statements. However, contingent assets are assessed
continually and if it is virtually certain that an inflow of economic
benefits will arise, the asset and related income are recognised
in the period in which the change occurs.

56. Derivatives
Currency derivatives

The Company uses foreign currency forward contracts and
currency options to hedge its risks associated with foreign
currency fluctuations relating to certain firm commitments and
forecasted transactions. The use of foreign currency forward
contracts and currency options is governed by the Company’s
strategy. The Company does not use forward contracts and
currency options for speculative purposes.

57. Disclosure of Transactions with Struck off Companies:

As per the information available with the company, the Company
did not have any material transactions with companies struck
off under Section 248 of the Companies Act, 2013 or Section
560 of Companies Act, 1956 during the financial year.

58. Capital Management:

For the purpose of the Company’s capital management, capital
includes issued equity capital, and all other equity reserves
attributable to the equity holders of the Company. The primary
objective of the Company’s capital management is to safeguard
the Company’s ability to remain as a going concern and
maximize the shareholder value.

The Company manages its capital structure and makes
adjustments in light of changes in economic conditions, annual
operating plans and long-term and other strategic investment
plans. In order to maintain or adjust the capital structure, the
Company may adjust the amount of dividends paid to
shareholders, return capital to shareholders or issue new shares.
The current capital structure of the Company is equity based
with no financing through borrowings except through leasing.
The Company is not subject to any externally imposed capital
requirements.

No changes were made in the objectives, policies or processes
for managing capital during the year ended March 31, 2025
and March 31,2024.

59. Credit Rating

The following table presents an analysis of the credit quality of
debt securities issued by the Parent Company and its subsidiary.
Rating has been obtained from credit rating agency CARE
Ratings Ltd (Pervious year from Brickwork Ratings India Private
Ltd). The details of which are as below:

60. Additional Regulatory Disclosure Requirements

No transactions to report against the following disclosure
requirements as notified by MCA pursuant to amended Schedule
III:

a. Crypto Currency or Virtual Currency

b. Benami Property held under Prohibition of Benami Property
Transactions Act, 1988 and rules made thereunder

c. Registration of charges or satisfaction with Registrar of
Companies

d. Compliance with number of layers of companies

e. Relating to borrowed funds:

i. Willful defaulter

ii. Utilization of borrowed funds & share premium

iii. Borrowings obtained on the basis of security of current
assets

iv. Discrepancy in utilization of borrowings

v. Current maturity of long-term borrowings

f. Title deeds of immoveable properties not held in name of
company.

g. Relationship with Struck off Companies.

h. Revaluation of property, Plant and equipment as no such
revaluation taken place during the year.

Comments for variations above 25%, if any:

1. The company has incurred losses during FY 2024-25 whereas the company earned profits during FY 2023-24 leading to decline in ratio
of debt service coverage ratio, Return on Equity (ROE), Net profit ratio and Return on capital employed (ROCE).

2. During FY 2024-25, sales of the company (net of GST) have declined to ' 16,699.74 million as compared to ' 16,840.86 million in FY
2023-24 and the working capital of the company have been declined to ' 2,160.44 Million in FY 2024-25 as compared to ' 3,110.14
million in FY 2023-24. Both these factors have resulted in an improvement of Net capital turnover ratio.

62. The Company has re-grouped the previous year’s figures to confirm the current year’s classification.

FOR NECTAR LIFESCIENCES LIMITED For Deepak Jindal & Co.

CHARTERED ACCOUNTANTS
Firm Regn. No. 023023N

Sanjiv Goyal Amit Chadah (Onkar Singh)

Chairman & Managing Director Chief Executive Officer Partner

DIN: 00002841 M. No. 514746

Sushil Kapoor Sanjaymohan Singh Rawat

Chief Financial Officer Company Secretary

Place: Chandigarh
Date: 07.07.2025