Dear Shareholders,

Your Directors are pleased to present their Forty-Third Annual Report and Audited Financial Statements for the Year ended 31 March 2022.

FINANCIAL PERFORMANCE

The Financial Statements for the year ended 31 March 2022 have been prepared in accordance with the Indian Accounting Standards (Ind AS) read with Section 133 and other applicable provisions of the Companies Act, 2013 ("Act").

The Company discloses consolidated and standalone financial results on a quarterly basis, which are subjected to limited and publishes consolidated and standalone audited financial results annually.

PERFORMANCE REVIEW

The Company continues to be engaged in development, manufacture and sale of branded and generic pharmaceutical formulations.

During the year under review, Consolidated Revenue from Operations increased to Rs 3,341 cr., around 16% higher than the previous year. Consolidated Profit AfterTaxgrewat9%from Rs 654 cr. to Rs 713 cr. Exports contributed around 70% of the business. dividEnd

At the meeting held on 29 October 2021, the Board had declared an interim dividend of Rs 9.50/- (475%) per equity share in accordance with the Dividend Distribution Policy of the Company. Total dividend payout was Rs 82.21 cr. In order to conserve resources for business operations, the Board recommends interim dividend to be considered as final dividend for FY 2022. The Dividend Distribution Policy is placed on the website of the Company and can be accessed at http://www.ajantapharma.com/AdminData/PolicyCodes/

DividendPolicy.pdf

SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES

The Company continues to have including one step down subsidiary. The Company does not have any Associate company or Joint Venture.

During the year, Ajanta Pharma Mauritius Limited (APML) closed down its manufacturing unit after following due process and complying with regulatory requirements. The manufacturing facility was about 25-year-old and needed upgrade involving major capex, which was commercially unviable. The Company has sufficient manufacturing capacity in India and all the supplies of erstwhile Mauritius facility would be catered from India. APML will continue to operate with trading activities. APML's subsidiary Ajanta Pharma Mauritius (International) Limited located in the Free

Trade Port is being wound up as it lost its relevance due to rationalisation of tax structure in Mauritius.

All the subsidiaries except Ajanta Pharma Nigeria Limited and Ajanta Pharma Mauritius (International) Ltd. have contributed positively in the growth and profitability of the

Company. Financials of subsidiaries are included in the consolidated financial statements, which forms

Annual Report. Statement containing salient features of financials of subsidiaries pursuant to Section 129 of the Act read with Rule 5 and 8(1) of the Companies (Accounts) Rules, 2014, is annexed in the Form AOC-1 as "annexure a" to this Report.

Audited Financial Statements of Company's subsidiaries are available on Company's website at www.ajantapharma.com and the same are available for inspection at the Registered

Office of the Company. The same will also be made available to interested members upon getting request.

Company's "Policy on Material Subsidiaries" can be accessed at http://www.Ajantapharma.com/AdminData/PolicyCodes/ PolicyonMaterialSubsidiaries2019.pdf

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Act and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)

Regulations, 2015 ("Listing Regulations"), the Annual Audited year Consolidated Financial Statements for the financial ended 31 March 2022, together with Report of Auditors' thereon, forms part of this annual report.

CREDIT RATING

The Company's bank facilities are rated by Credit Analysis and Research Limited ("CARE"). They have assigned rating overseas subsidiaries, CARE AA / CARE A1+ for long term / short term bank facilities, which reaffirms the reputation and trust the Company has earned for its sound financial management and its ability to meet its financial obligations.

SHARE CAPITAL

The Company's bank facilities are rated by Credit Analysis and Research Limited ("CARE"). They have assigned rating CARE AA / CARE A1+ for long term / short term bank facilities, which reaffirms the reputation and trust the Company has earned for its sound financial management and its ability to meet its financial obligations.

Buy-back of shares

During the year, the Company bought back 11,20,000

(Eleven lakhs twenty thousand only) fully paid-up equity shares of the face value of Rs 2/- each, representing 1.29% of the total number of equity shares in the subscribed of this and paid-up equity share capital of the Company, from the existing shareholders / beneficial owners of equity shares of the Company on a proportionate basis, through "Tender Offer" route, at a price of Rs 2,550/- (Rupees Two thousand five hundred and fifty only) per equity share for an aggregate amount of Rs 285.60 cr.

Post Buyback, the paid-up share capital stood reduced from 8,65,35,770 equity shares to 8,54,15,770 equity shares of Rs 2/- each. Post buyback shareholding pattern is given in the Corporate Governance Report.

Employee Stock option Scheme

The Company has formulated and implemented Employee Stock Option Scheme, 2011 ("ESOS 2011") and Ajanta Pharma Share Based Incentive Plan 2019 ("SBIP 2019"). The Nomination and Remuneration Committee ("NRC") administers these schemes. There were no changes in the schemes during the year.

During the year, 4,000 shares were issued and allotted against the options exercised. Disclosures with regard to Employees' Stock Options Scheme are put up on the Company's website and can be accessed at http:// www.ajantapharma.com/AnnualReports.aspx M/s. Alwyn Dsouza & Co., Secretarial Auditor have issued certificate 2019 have been implemented in accordance with SEBI regulations and the resolution passed by members in their general meeting. The certificate will be available for inspection by members at the ensuing Annual General Meeting ("AGM").

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Board of Directors of the Company comprise of eminent persons of proven competence and integrity. They bring in diversified knowledge & experience, strong financial & business acumen, management & leadership qualities. retirement by rotation

Mr. Mannalal B. Agrawal retires by rotation at the ensuing AGM and being eligible, has offered himself for re-appointment. The Board recommends his reappointment. independent directors

All the Independent Directors have given declarations that they continue to meet the criteria of independence as laid down under Section 149(6) of the Act and under the Listing Regulations. They have registered their names in the Independent Directors data-base and have passed the proficiency test, if applicable. They have also affirmed compliance to the Conduct for Independent

Directors.

The Board is of the opinion that the Independent Directors of the Company possess requisite qualifications, experience and expertise in the fields of manufacturin g, management,operations,strategy, sales & marketing, auditing, banking, risk management and they hold high standards of integrity.

Based on disclosures provided by them, none of them are disqualified from being appointed as Director under Section 164 of the Act and are independent from the management.

Policies on appointment and remuneration of directors

The Company has laid down "Policy for Determining Qualifications of Directors" and "Policy for Remuneration of Directors and Employees" as approved by the NRC. The policies are available at: h t t p : / / w w w. a j a n t a p h a r m a . that ESOS 2011 & SBIP com/AdminData/PolicyCodes/ PolicyfordeterminingqualificationsofDirectors.pdf http://www.ajantapharma.com/AdminData/ PolicyCodes/Policyforremuneration2018.pdf The Policy for Determining Qualifications of

Directors sets out guiding principles for selection of persons who are qualified to become Directors/ Independent Directors.

The objective of the Policy for Remuneration of

Directors and Employees is to ensure that the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate the Directors, Key Managerial Personnel ("KMP") and Senior Management employees. The same are briefly mentioned in the Corporate Governance Report.

KEY MANAGERIAL PERSONNEL

Mr. Yogesh M. Agrawal, Managing Director; Mr. Rajesh M. Agrawal, Joint Managing Director; Mr. Arvind K.

Agrawal, Chief Financial Officer and Mr. Gaurang C.

Shah, Company Secretary are the KMP of the Company as on the date of this report.

Board and directors' evaluation

As per provisions of the Act and Regulation 17(10) of the Listing Regulations, the evaluation process for the performance of the Board, its committees and individual Directors was carried out by Board of Directors, in accordance with the framework and criteria laid down by the NRC. Further, at a separate meeting, the Independent Directors evaluated performance of Non-Independent

Directors, Board as a whole and of the Chairman of the Board. A consolidated report on performance evaluation was shared with the Chairman of the Board for his review and discussion with Board and each Director.

The manner of evaluation of Board of Directors performance and matters incidental thereto, are detailed in the Report on Corporate Governance.

Board mEEtingS

During the year, 5 Board meetings were held through video-conferencing due to on-going threat of COVID-19. Details of meetings are given in the Report on Corporate Governance. Measures were taken to ensure security of information and confidentiality of process, at the same time, ensuring convenience of the Board members.

BOARD COMMITTEES

The Board currently has six committees, viz., Audit

Committee, Nomination and Remuneration Committee, Corporate Social Responsibility Committee, Stakeholders Relationship Committee, Risk Management Committee and Executive Committee. All the recommendations made by these Committees of Board including the Audit Committee were accepted by the Board.

A detailed update on the committees, its composition, number of Committee meetings held and attendance of the directors at each meeting is provided in the Report on Corporate Governance.

RELATED PARTY TRANSACTIONS AND POLICY

All the Related Party transactions ("RPTs") entered into during the financial year were in accordance with the Company's Policy on Related Party Transactions, on an arm's length basis and in the ordinary course of business.

Pursuant to Regulation 23(3) of the Listing Regulations and

Rule 6A of the Companies (Meetings of Board and its Powers)

Rules, 2014, the Audit Committee granted omnibus approval to the transactions likely to be entered into by the Company with related parties during the year and are of repetitive nature. A statement of all the RPTs effected is presented before the Audit Committee on a quarterly basis. Members may refer to Note No. 53 to the Financial Statement which sets out related party disclosures pursuant to IND AS-24.

During the year, the Company had not entered into any transactions with related parties (save and except transactions with company's subsidiaries), which could be considered as material in accordance with the Company's

Policy on materiality of RPT or which are required to be reported in Form AOC-2 in terms of Section 134(3)(h) read with Section 188 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014.

CORPORATE SOCIAL RESPONSIBILITY ("CSR")

The CSR Committee reviews and monitors the CSR projects and expenditure undertaken by the Company on a regular basis and apprises the Board of the same.

Company has spentover2% profits during theaveragenet the three preceding financial years in accordance with

CSR Policy and Annual Action Plan of the Company. CSR activities were carried out in the field of healthcare and education for the under privileged people. Company also contributed significantly in collaboration with credible NGOs across various states for providing relief to the communities impacted by COVID-19 such as conducting of vaccination drive, distributing essential groceries to the needy, providing medical equipment and PPEs.

Further, in terms of the amended CSR Rules, the Chief

Financial Officer has certified that the funds disbursed for

CSR have been used for the purpose and in the manner approved by the Board for the financial year 2022.

CSR policy and report on CSR activities undertaken during the year in accordance with Section 134 & 135 of the Act read with Rule 8 of the Companies (Corporate Social Responsibility Policy) Amendment Rules, 2021 and Rule 9 of the Companies (Accounts) Rules, 2014, is annexed as "annexure B" to this report.

MANAGEMENT DISCUSSION AND ANALYSIS

A detailed review of the operations, performance and future outlook, major events occurred during the year as well as state of company's affairs is given in the Management Discussion and Analysis, which forms part of this report.

REPORT ON CORPORATE GOVERNANCE

The Board of Directors reaffirmtheir continued commitment to good Corporate Governance practices and elevating the same.

Report on Corporate Governance together with certificate from the Practicing Company Secretaries confirming compliance of conditions of Corporate Governance, is annexed and forms an integral part of this report.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

Company believes in creating value for all its stakeholders. It has been conducting business in a sustainable manner and in a way that delivers long-term shareholder value and create maximum value for the Society.

The Company is also committed to ensure that its actions positively impact the economic, societal and environmental dimensions of the triple bottom line.

The Company has on voluntary basis adopted Business Responsibility and Sustainability Report ("BRSR") for FY 2022 based on the National Voluntary Guidelines on Social,

Environmental and Economic responsibilities of business, to demonstrate sustainability objectives and company's performance on ESG parameters. The said report forms part of the Annual Report and the same have been hosted on the Company's website, which can be accessed at http://www. ajantapharma.com/AnnualReports.aspx. Any Member interested in obtaining a copy of BRSR may write to the Company Secretary.

UNCLAIMED DIVIDEND / SHARES

In pursuance of Regulation 39 read with Schedule VI of the

Listing Regulations, the details of shares lying in unclaimed suspense account and unclaimed shares / dividend transferred to Investor Education and Protection Fund, are provided in the Report on Corporate Governance.

ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3) (a) of the Act, the Annual Return as on 31 March 2022 is available on the Company's website at http://www.ajantapharma.com/ AnnualReports.aspx.

AUDITORS AND AUDIT REPORTS

Pursuant to Section 92(3) read with Section 134(3) (a) of the Act, the Annual Return as on 31 March 2022 is available on the Company's website at

Statutory auditors

The Auditors' Report on the financial statements of the Company for the financial year ended 31 March 2022 is unmodified i.e. it does not contain any qualification, reservation, adverse remark or disclaimer. The Notes on financial statement referred to in the Auditor's Report are self-explanatory and do not call for any further comments. The Auditors' Report is enclosed with the financial statements forming part of the Annual Report. M/s. B S R and Co. LLP, Chartered Accountants (ICAI

Registration No.: 101248W/W-100022) ("M/s. BSR") are the Statutory Auditors of the Company. Their tenure expires at the conclusion of ensuing 43rd AGM of the Company.

M/s. BSR was established in the year 1990 and is a Limited Liability Partnership Firm registered with the Institute of Chartered Accountants of India ("ICAI"). Their registered office is in Mumbai and have 12 branch offices in various cities in India. It is primarily engaged in providing audit and assurance services to its clients. Based on the recommendation of the Audit Committee, the Board of Directors of the Company at its meeting held on 10 May 2022, have subject to approval of members, re-appointed M/s. BSR as the Statutory Auditor of the Company for a period of five years, i.e., to hold office from the conclusion of the 43 rd AGM till the conclusion of the 48th AGM to be held in the year 2027.

Proposal for their re-appointment is placed in the Notice convening the 43rd AGM, which forms part of this report.

M/s. BSR have confirmed their independent status and eligibility for the said appointment. The Company has received confirmation from them to the effect that their appointment, if made, will be in accordance with the limits specified under the Act and that the firm satisfies the criteria specified in Section 141 of the Act read with Rule 4 of Companies (Audit & Auditors) Rules, 2014. They have also confirmed that they hold a valid certificate issued by the Peer Review Board of the ICAI. The Board is of the opinion that continuation of M/s.

BSR, as Statutory Auditors will be in the best interests of the Company and recommends to the members to consider their re-appointment as Statutory Auditors of the Company, for another term of five years, from the conclusion of the ensuing AGM, till the AGM to be held in the calendar year 2027, at such remuneration mutually agreed and approved by the Board.

internal auditors

M/s. Ernst & Young LLP conducted internal audit of important centralised functions. For other locations, viz. factories, C&F agents and warehouses, other Chartered

Accounting Firms having requisite expertise and resources are appointed as Internal Auditors. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board.

Secretarial auditors

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

Managerial Personnel) Rules, 2014 and Regulation 24A of the Listing Regulations, Board had appointed M/s. Alwyn D'souza & Co., Practicing Company Secretaries to undertake the Secretarial Audit of the Company.

Secretarial Audit Report is annexed to this report as

"annexure c". There are no qualifications or reservations or adverse remarks in the Secretarial Audit Report. The

Secretarial Audit Report is self-explanatory and does not call for any further comments.

cost auditors

The Company maintains cost accounts and records as per the provisions of Section 148(1) of the Act and the same are audited by the Cost Auditors. Cost Audit Report for FY 2021 has been filedwith the Ministry of Corporate Affairs.

Based on the recommendation of the Audit Committee, Board has appointed M/s. Sevekari, Khare & Associates, practicing Cost Accountants, to audit the cost records of the Company for FY 2023. They have confirmed that their appointment is in accordance with the applicable provisions of the Act and rules framed thereunder and that they are not disqualified to be appointed as the Cost Auditors of the Company for the year ending 31 March 2023.

Resolution for ratification of remuneration of the Cost Auditors by the Members has been set out in the Notice of the 43rd AGM.

During the year under review, the statutory auditors, internal auditors, secretarial auditors and cost auditors have not reported any instances of fraud committed in the Company.

ANNUAL SECRETARIAL COMPLIANCE REPORT

M/s. Alwyn D'Souza & Co., Practicing Company Secretaries, have issued Secretarial Compliance Report for the year ended 31 March 2022 confirming compliance of SEBI Regulations / guidelines / circulars issued thereunder and applicable to the Company. There are no observations or adverse remarks in their report.

SECRETARIAL STANDARDS

During FY 2022, the Company has complied with all applicable mandatory Secretarial Standards issued by The Institute of Company Secretaries of India.

INTERNAL CONTROL SYSTEM, RISK MANAGEMENT AND COMPLIANCE FRAMEWORK

The Company has a well-established internal control framework, which is designed to continuously assess the adequacy, effectiveness and efficiency of financial and operational controls. It helps to identify, assess and leverage business opportunities and manage risks effectively. The Internal Financial Controls ("IFCs") are commensurate with the scale and complexity of its operations. The controls were tested during the year and no reportable material weaknesses either in their design or operations were observed. The current system of IFCs is aligned with the requirement of the Act and is in line with globally accepted risk-based framework.

The Company has put in place robust policies and procedures, which inter-alia, ensure integrity in conducting its business, safeguarding its assets, timely preparation of reliable financial information, accuracy & completeness in maintaining accounting records and prevention & detection of frauds & errors.

The Company also has Risk Management framework in place which defines roles and responsibilities at various levels of the risk management process.

Board has set up Risk Management Committee ("RMC") as per details set out in the Report on Corporate Governance. Audit Committee and RMC reviews key risk elements of the Company's business, finance, operations & compliance and its mitigation strategies. RMC reviews key strategic, business, compliance and operational risks; whereas issues around ethics and fraud, internal control over financial reporting, process risks and their mitigation, are reviewed by the Audit Committee. Risk Management system followed by the Company is detailed in the Management Discussion and Analysis report and in the Notes of Accounts.

SUPPLY CHAIN

Your Company developed a resilient supply chain that supported business growth despite adversities caused by the second wave of COVID-19. Staying agile, it continued sourcing raw materials from over approximately 2,550 suppliers, while ensuring the safety of its partners and customers.

Further, quality, safety and compliance continued to remain the backbone of supply chain operations team.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

Company has zero tolerance policy for any form of unethical behavior. The Company has formulated vigil mechanism viz., Whistle Blower Policy to encourage the company employees who have knowledge of actual or suspected violation, malpractices, corruption, fraud or unethical conduct, leak of unpublished price sensitive information, etc. The employees can come forward and express their legitimate concerns to the Audit Committee Chairman without any fear of reprimand, victimisation or unfair treatment.

It is posted on the intranet and website of your Company and the same is available at http://www.ajantapharma.com/ AdminData/PolicyCodes/WhistleBlowerPolicy2019.pdf The same is reviewed by the Audit Committee from time to time. No concerns or irregularities have been reported by employees / directors till date. It is affirmed that no person has been denied access to the Audit Committee.

POLICY ON SEXUAL HARASSMENT OF WOMEN AT WORK PLACE

The Company is committed to creating a healthy working environment that enables employees to work without fear of prejudice and gender bias. The Company has formulated

Policy on prevention, prohibition and redressal of sexual harassment of women at workplaces in accordance with

The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act 2013. Your Company has a robust mechanism in place to redress complaints reported under it if any. Company has been imparting training programmes on periodic basis to familiarise women employees about the policy. Policy is available on intranet of the Company. The policy has set guidelines on the redressal and enquiry process that is to be followed by complainants and the Internal Complaints Committees (ICC), whilst dealing with issues related to sexual harassment at the work place.

The Company has set up ICC at all the locations where there are more than 10 women employees, to address the complaints regarding sexual harassment. Company has not received any complaints during the year.

CODE OF CONDUCT

The Company has laid down a robust Code of Business

Conduct and Ethics, which is based on the principles of ethics, integrity and transparency. More details about the Code are given in the Corporate Governance Report.

HUMAN RESOURCE, HEALTH & SAFETY

The Company takes pride in its human capital, which comprises people from diverse backgrounds and cultures. Despite severe competition, the enthusiasm and unstinting efforts of the employees have enabled the Company to remain at the forefront.

Ajantaites have unflinching commitment and ensure that despite the challenges, the highly efficacious medicines manufactured by the Company were made available across the world.

The Company gives paramount importance to safety, security and well-being of its human resources and maintains highest standards of health and safety in all its plants and facilities.

MANAGERIAL REMUNERATION AND PARTICULARS OF EMPLOYEES

There were 7,234 permanent employees of the Company as of 31 March 2022. The information pursuant to Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed to this report as "annexure d".

Information pursuant to Rule 5(2) & 5(3) of the Companies

(Appointment and Remuneration of Managerial Personnel)

Rules, 2014 also forms part of this report pursuant to proviso to Section 136(1) of the Act. Any shareholder interested in obtaining a copy of the same may write to the Company Secretary at the registered office address of the Company.

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

Pursuant to Section 134 of the Act read with Companies (Accounts) Rules, 2014, particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, are given in "annexure E" to this report.

LOANS, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees and Investments, pursuant to provisions of Section 186 of the Act and Schedule V of the Listing Regulations, are given in Notes to Financial Statements.

OTHER DISCLOSURES

No disclosure or reporting is made with respect to the following items, as there were no such transactions during the year under review: Details relating to deposits accepted by the Company;

The issue of equity shares with differential rights as to dividend, voting or otherwise; Provision of money for the purchase of its own shares by employees or by trustees for the benefits of employees;

Remuneration or commission received by Managing

Director & CEO from subsidiaries; Revision in the financial statements;

Change in the nature of company's business;

Transfer of any amount to reserves during the year under review;

Material changes and commitments affecting financial position of the Company between the end of the financial year and the date of this report.

DIRECTORS' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your

Directors confirm: a. that in the preparation of the annual accounts for the year ended 31 March 2022, the applicable Accounting

Standards have been followed along with proper explanation relating to material departures, if any; b. that the Directors had selected accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year ended 31 March 2022 and of the profit of the Company for the period; c. that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; d. that the annual accounts/financial statements have been prepared on a going concern basis; financcontrols were in place e. that proper internal and that the financial controls were adequate and were operating effectively; f. that the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

GRATITUDE & ACKNOWLEDGEMENTS

Your Directors place on record, their sincere appreciation for the commitment, dedication, hard work and wholehearted efforts put in by each and every Ajantaite during the challenging times. The Directors also wish to express their gratitude to the Investors for the confidence and faith that they continued to repose in the Company. They also acknowledge the guidance, encouragement and cooperation received by it from various departments of the Governments & other statutory bodies, financial institutions, banks, distributors, suppliers, business associates, analysts, medical professionals and customers.