MULTICARE PHARMACEUTICALS PHILIPPINES INC.

ACCOUNTS FOR THE YEAR ENDED 31ST MARCH, 2010

26 T H FLOOR,RUFINO TOWER

6784 AYALA AVENUE,

MAKATI CITY 1226

PHILIPPINES

ARORA & ARORA CHARTERED ACCOUNTANTS

DHANLAXMI, HANUMAN ROAD, VILE PARLE (E), MUMBAI 400 057 TEL # 261 6 69 15

To the Board of Directors MULTICARE PHARMACEUTICALS PHILIPPINES INC.

We have performed the procedures agreed with you enumerated below with respect to translation and reformatting of the accompanying Balance Sheet of MULTICARE PHARMACEUTICALS PHILIPPINES INC., Philippines ('the Company') as at 31St March, 201 0, the Profit and Loss Account and also the Cash flow statement of the Company for the year ended on that date. Our engagement was undertaken in accordance with the Standard on Related Services (SRS 4400) "Engagements to Perform Agreed-Upon Procedures regarding Financial information", issued by the Institute of Chartered Accountants of India. In performing the procedures, we have relied upon the financial statements in Philippime peso ('PESO') originally audited by the statutory auditors of the Company in Philippinnes.

2. The PESO amounts as audited, have been translated into Indian Rupees ('INR') by the Company's management on the basis as stated in accounting policy A (e)(ii) and note 15 in Schedule 17 of the translated and reformatted accounts and reformatted in accordance with the requirements of the Companies Act, 1956. The translated and reformatted financial statements ( financial statements) have been approved by the Board of Directors of the Company.

3. In relation to the financial statements prepared by the management, the following agreed-upon procedures were performed by us:

(a) Verifying the translation of the audited financial statements as at and for the year ended March 3 1,20 10 from PESO into INR on the basis stated in the paragraph 2 above and

(b) Verifying the reformatting of the audited financial statements as at and for the year ended March 31,2010 as per the requirements of the Companies Act, 1956.

4. We report that the financial statements prepared in PESO as audited by the statutory auditors, have been translated and reformatted in INR on the basis stated in paragraph 2 above and such financial statements comply with the accounting standards referred to in Section 21 1 (3C) of the Companies Act, 1956 and the requirements of Schedule VI to the Companies Act, 1956.

5. The above procedures do not constitute an audit and accordingly, we do not express any audit opinion on the financial statements in PESO referred to in paragraph 1 above.

6. This report is issued solely with regard to financial statements as translated and reformatted to comply with the provisions of Section 212 of the Companies Act, 1956 by the holding company.

For ARORA & ARORA CHARTERED ACCOUNTANTS R~is t ra t ion No : 100544W y d y Q 2 k Act ~ h a f i ~ r e d tan's 7j + GIR ARORA

hl MS+ Partner M N o 41019 Mumbai, 30 April, 20 10

:ARE PHARMACEUTICALS PHILIPPINES INc.

IN PHP IN INR IN PHP IN INR

;HEET AS AT MARCH 31,2010 As at As at As at As at Schedules 31.03.2010 31.03.201 0 31.03.2009 31.03.2009

IS OF FUNDS

IOLDERS' FUNDS

:apital

3s and Surplus

UNDS d Loans

red Loans

:ATION OF FUNDS

4SSETS Block

Iepreciation

3ck

ed tax assets note No. 1 of Schedule 17)

TOTAL I 142,764,050 1 1 141,836,082 1 ( 98,500,653 1 1 103,425,688 1

iNT ASSETS, LOANS AND ADVANCES

ories

y Debtors

and Bank Balances

; and Advances

CURRENT LIABILITIES AND PROVISIONS

:nt Liabilities

sions

:URRENT ASSETS

'icant Accounting Policies and

; to Accounts

TOTAL I 142,764,050 1 1 141,836,082 1 I 98,500,653 ( 1 103,425,688 1

X Chartered

- per our attached report of even date

For Arora & ArOra chartered Accountants

For MULTICARE PHARMACEUTICALS PHILIPPINES, INC

Vinod Dhawan Chandru Chawla Chairman Director

place : Mumbai Place : Murnbai Dated : Apd 30 , 2010 Dated : April 30 ,201 0

) U L T I ~ ~ f t ~ PHARMACEUTICALS PHILIPPINES INc.

koFIT AND LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31,2010

IN PHP IN INR IN PHP IN INR Current Year Current Year For the Period For the Period

1. Schedules ended ended From 26.03.2009 From 26.03.2009 31.03.2010 31.03.2010 TO 31.03.2009 TO 31.03.2009

INCOME Sales Other Income

EXPENDITURE cost of Materials 13 personnel Expenses 14 Manufacturing and Other Expenses 15 Interest and Finance Charges 16 Depreciation and Amortization

Profit before Tax

:Provision for Taxation - Current Tax . - Less : MAT Credit Entitlement - Deferred Tax

get Profit after Tax Add : Surplus brought forward from previous year

3alance carried to Balance Sheet

Earnings Per Share (Refer note No.9 of Schedule 17) - Basic

. - Ciluted

NOmlnal Value ot each equity share IS PHP 1U

i Significant Accounting Policies and ' Notes to Accounts 17

( per our anached repomf even date

For MULTlCARE PHARMACEUTICALS PHILIPPINES, INC

Vinod Dhawan Chandru Chawla Chairman Director

place : Mumbai Place : Mumbai ~ ~ t e d : April 30, 2010 Dated : April 30 ,201 0

-

IN INR CASH FLOW STATEMENT FOR THE YEAR ENDED 31.03.2010

IN PHP IN INR Current Year

ended 31.03.2010

IN PHP For the Period

From 26.03.2009 To 31.03.2009

Current Year ended

31.03.2010

For the Period From 26.03.2009

To 31.03.2009 cash Flow from Operating Activities Net profit before Tax Adjustments for:

Depreciation and Amortisation Profit on saleldiscard of Fixed Assets (net) lnterest and Finance Charges lnterest on Deposits Dividend on Long Term lnvestment - Trade

Operating Profit before Working Capital Changes 44,319,236 Adjustments for:

Trade and other Receivables (7,216,521) Inventories (2,037,590) Trade and other Payables (32,820.800)

Cash Generated from Operations 2,244,325

Direct Taxes paid (net) Net Cash Generated from Operating Activities

Cash Flow from Investing Activities Additions to Fixed Assets Sale of Fixed Assets Sale of Investments Dividend on Long Term lnvestment - Trade lnterest on Deposits

Net Cash used in Investing Activities

Cash Flow from Financing Activities

Proceeds from issue of Equity Shares 30,000,000 Proceeds/(repayrnent) fromlof Borrowings (net) 25,362,833 25,197,975 (47,402,300) Issue of Equity Shares (ESOPs) Securities Premium Received (ESOPs) Interest and Finance Charges paid (net) (5,729,626) (5,729,626) (229.209) Dividend paid Corporate Dividend Tax paid

Net Cash Generated froml(used in) Financing Activities 19,633,207 19,468,349 (17,631,509)

Net decrease in Cash and Cash equivalents (5,591,485) (5,871,057) 7,092,316

Cash and Cash equivalents as at the beginning of the period 15,270,685 16,034,219 8,178,369

Cash and Cash equivalents as at the end of the period 9,679,200 10,163,162 15,270,685

. . I .

1 .Cash and Cash equivalents include Cash and Bank Balances (Refer Schedule 9) 9,616,285 Unrealised (gain)lloss on foreign currency cash and cash equivalents 546,877 Total Cash and Cash equivalents 10,163,162

2. Additions to Fixed Assets (including movements in Capital Work-in-Progress) are considered as a part of investing activities. 3. lnterest income on Bank Deposits is classified as cash flow from investing activities. 4. The above Cash Flow Statement has been prepared under the 'Indirect Method' as set out in the Accounting Standard 3

(AS-3) "Cash Flow Statement".

1 As per our attached report of even date

- I For Arora 8 Arora c h a ~ d Accountants

partner

place : Mumbai Dated : April 30.2010

For MULTICARE PHARMACEUTICALS PHILIPPINES. INC

Vinod Dhawan ~ h a n d h Chawla Chairman Director

Place : Mumbai Dated : April 30 . 201 0

SCHEDULES F O ~ ~ l ~ G PART OF THE BALANCE SHEET

IN PHP IN INR IN PHP IN INR

sCHEDUL~ 1 .SHARE CAPITAL

As at 31.01.2010 31.03.2010 H.01.2009 11.01.2009

AU#nonxed

3,000,000 year 3,000,000) Equity Shares o l PHP 10 each

TOTAL

2,565,000 year2.5BS.WO) Equily Shares of PHP 10 each pald up

(1,,08,150 ( p r e ~ i ~ u ~ year 1.308.150) shares are held by 'Lupin Holdings B.V.NeIherlandsm, the holding company) 25.650.000 26.932.500 25.650.000 26.932.500

TOTAL 25,650,000 26,932,500 25,650,000 25,932,500

S , - ~ ~ ~ ~ ~ E 2 -RESERVES AND SURPLUS

SeLY,ilie~ Premium ACcOUn( Balance p r last Balance Sheel Add . Remived durina the Pedad

cumency translation reserve tredlled/(debiled) during the year (net)

SUmlYS in profil and Loss AecOunl

TOTAL 71,665,639 69,750,486 52,764,975 55,403,226

. ,qepresenls amount received on allolmenl of 18O.OW Equity Shares of PHP 10 each lo Lupin Holdings B.V..Nsalherlands.lhe holding campany

QCHEDULE 3 -SECURED LOANS I Working Capital Loans from Banks

dotes : TOTAL

I) Lease obligations lo financial lnslitulions are Secured by hypotlcation oftranrpcn vehicles !) wonlng Capilal Loans from Banks sewred by letter of Comfort from ~ u p h Limited and pledus of linished goods

8.232.71 7 6,192,205 I) Working Capital Loans fmm Banks secured by way of charge agalnsl mcelvables from a distributor and pledge of finished goods :) Arnaunlsdue vithin a Year 8.344.847 8.290.605

.=are Obligations

;CHEDULE 4 -UNSECURED LOANS I e m Loans from Banb

Norking Capital Loans from Banks 'oI~S : TOTAL 1 Amount due withln a year

Tem Loans from Banks I Working Capital Loans from Banks sewred by letter of Comfort from LuplnLlmHed

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Number Face IN PHP IN INR IN PHP

Value

IN INR

AS at As st 31.03.2010

AS at 31.03.2010

As at 31.03.2009 31.03.2009

I ~n EquW

. umuoted lT"de)

phll,pplnes ~ o n g Distance Telephone Co

TOTAL

stock.m-trade

.aaw Malerials

. packing Malerials

. Work.in.ProceSS

. Finished mods (including Traded Goods)

TOTAL

H~~~~~ 8. SUNDRY DEBTORS nsacurad l

~ ~ b t ~ oujllanding for a period exceeding six monlhs .considered good

doublful

olhwr Debts considered good

~~~s prov~sion for doubtful debts

TOTAL

{EDULE 9 -CASH AND BANK BALANCES

Cash in hand 10,000 9,935 1O.WO 10.500

Bank Balances : - Wflh Other6

In Current Accounts TOTAL

c Balances include balances wnh non scheduled banks are as under:

e of the Bank In Philip~ines Account tvoe

co De oro Unibank -US Dollar Accounl co De om Unlbank ;of Commerce :of Philippine Islands : 01 Philippine Islands-US Dollar Account h e y Bank Bank lpolilln Bank and Tlvst Company lpolil'in Bank and Tlvst Company ng Bank of Asla Bank

Current Account Currenl Account Current Acwunl Current Account Current Account Current Account Current ACWU~I

Cumnl Account Current Account Current Account current Account

As at 31.( IN PHP

18.568 216,310

2.372.918 120.856

127.460 10.000

4.375.941

2.427.147

Maximum Balance dudng the period IN PHP IN INR 2,245.345 2.230.750

11.194.026 11.121.265 72.414 71.943

11.987.686 11.909.766 3.411.731 3.389.555

10,012.554 9.947.472 127.507 126,678 10.000 9.935

12.618.422 12,536,402 7.302.143 7,254,679

11.490.867 11.416,176.,

As at 31.03.2009 IN PHP IN INR

9.497 9.972 6.108.753 6,414,191

69.761 73,249 4.613.164 4.843.823

95.871 100.664 70.435 73.957

126.475 132.799 10,000 10.500

4.089.667 4.294.1 51 67.061 70.414

Maximum Balance during the pedod IN PHP IN INR

9.566 10.044

sldered unless othewlre stated 31.03.2010

I pmv1510n ,ordoubtful advances 9 1 5 '

TOTAL

HEDUL~ H .CURRENT LlABlUTlES AND PROVISIONS I mnt ~ lab i l l t le~ ~mptances

creditors : ,) Trrlal outsfanding dues lo small scale induslrlal undenakings Tolal ou(slanding dues to creditors clherthan small scale induslrial undeflaklngs

aner LhbllitieS

lnlere5(~ccrued bui not due on loans

TOTAL

F~~ Retiremen1 Benefits F~~ pe pen sated Absences F~~ Tsxalion ( nel of Advance Tax)

TOTAL 66.838.614 66,404,163 105.140.137 H0,397,145

I N PHP iN INR IN PHP IN INR Current Year Current Year

ended For the Perlod F o r the Period

ended From 26.03.2009 F~~~ 26.03.2009 31.03.2010 31.03.2010 l o 31.03.2009 t o 31.03.2009

nd on Long lnusrlments -Trade

~ n l s d ,Lo.,, On sale af assets

E- E D V L ~ 13. COST OF MATERIALS

TOTAL

ing Slocx : ?Fl,,,nad ~ ~ ~ d r (including Traded Goods) 37.306.669 39.172.003 36.841.248 38,683,310

. won in. Pmcers 1.537.875 1.614.768 1,688,383 a 38.844.544 40.786.771 38.529.631 40.456.112

clng SloCk : Fln,sned ~ ~ o d s (including Tradad Goods)

Won. ln. process

,,,,in ~ l ~ k or Finished Goods (including Traded Goods) and Wok.in.procesr TOTAL

,ED~L+ 14. PERSONNEL EXPENSES

w,, wegas and Bonus 47.980.870 47.980.870 2.320.723 2.436.759 lrlbution mrRefiramen1 ben8fitS 3.098.300 3.098.300 682.274 716.387

I wetlam Expenses 3,599,274 3,599.274 196.238 206.050 TOTAL 54,678.444 54,678,444 3,199,235 3,359,196

ended 31.03.2010

Fmm 26.03.2009 Fmm 26.03.200g 31.03.2010 to 31.03.2009 to 31.03.2009

TOTAL

E ~ V L E 16 .INTEREST AND FINANCE CHAROES

,,I on nxed ~ o a n s 2.68s.118 2.685.118 228,409 239.829 R 3.044.508 3.044.508 800 840

TOTAL 5,729,626 5.729.626 229,209 240,669

SCHEDULE - 17

SIGNIFICANT ACCOUNTING POLICIES AND NOTES FORMING PART OF THE BALANCE SHEET AND PROFIT AND LOSS ACCOUNT

A) SIGNIFICANT ACCOUNTING POLICIES

a) Basis of Preparation of Financial Statements:

The financial statements are prepared as per historical cost convention and in accordance with the generally accepted accounting principles in India.

b) Use of Estimates:

The preparation of financial statements requires estimates and assumptions that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Differences between the actual results and the estimates are recognised in the period in which the same are known/materialised.

c) Fixed Assets:

Fixed Assets are stated at cost less accumulated depreciation and accumulated impairment losses, if any.

d) Intangible Assets:

Intangible assets are recognised only if it is probable that the future economic benefits that are attributable to the assets will flow to the enterprise and the cost of the assets can be measured reliably. The intangible assets are recorded. at -cost and are carried at cost less accumulated amortisation and accumulated impairment losses, if any.

e) Foreign Currency Transactions / Translation:

i) Foreign Currency Transactions

Transactions in foreign currency are recorded at the original rate of exchange in force at the time transactions are effected. Exchange differences arising on settlement of all transactions are recognized in the profit and loss account.

Monetary items (other than Long term Foreign Currency Monetary items in terms of Notification relating to AS 11 issued by the Ministry of Corporate Affairs in March 2009) denominated in foreign currency are restated using the exchange rate prevailing at the date of the

Balance Sheet and resulting net exchange difference is recognized in the Profit and Loss Account.

The exchange differences arising on reporting of the Long Term Foreign currency Monetary Items at the rates different from those at which they were initially recorded during the period or reported in the previous financial statements, in so far as they relate to the acquisition of a depreciable capital asset, are added or deducted as the case may be, from cost of the respective asset and depreciated over the balance life of those assets. In other cases, these are accumulated in a "Foreign Currency Monetary Item Translation Difference Accountn and arnortised over the balance period of such long term assetlliability not beyond 31st March, 2011, in terms of the Notification relating to AS 11 issued by the Ministry of Corporate Affairs in March 2009.

ii) Foreign Currency Translation: The local accounts are maintained in local and functional currency, which is the Philippine Peso. The financial statements have been translated to Indian Rupees considering the operations of the Company as 'non integral operations' for the holding company on the following basis -

i. All income and expenses are translated at the average rate of exchange prevailing during the period.

ii. All monetary and non-monetary assets and liabilities, excluding share capital are translated at the closing exchange rate as at the Balance sheet date.

... 111. Share capital is translated at historical rates.

iv. The resulting exchange diffe~ence is accounted in 'Foreign Currency Translation Reserve'.

f ) Investments:

Long-term investments are stated at cost of acquisition. Provision for diminution in the value of long-term investments is made only if such decline is other than temporary.

g) Inventories:

Stock-in-trade is valued at lower of cost and net realisable value. Cost is computed based on FIFO method in respect of all procured materials. Cost also includes all charges incurred for bringing the inventories to their present location and condition.

h) Employee benefits:

i) ~e f ined Benefit Scheme company's liabilities towards defined benefit scheme expected to occur after twelve months, are determined using the Projected Unit Credit Method. Actuarial valuations under the Projected Unit Credit Method are carried out at the year ended on March 31, 2010. Actuarial gains and losses are recognised in the Profit and Loss account in the period of occurrence of such gains and losses.

The retirement benefit obligation recognised in the balance sheet represents the present value of the defined benefit obligation as adjusted for unrecognised past service cost, and as reduced by the fair value of scheme assets. Any asset resulting from this calculation is limited to past service cost, plus the present value of available refunds and reductions in future contributions to the scheme.

ii) Short-term emplovee benefits Short-term employee benefits expected to be paid in exchange for the services rendered by employees are recognised undiscounted during the period employee renders services. These benefits include incentives & bonus.

i) Revenue recognition:

i) Revenue from sale of goods is recognised when the significant risks and rewards in respect of ownership of products are transferred by the Company.

ii) Revenue (including in respect of insurance or other claims, interest etc.) is recognised when it is reasonable to expect that the ultimate collection will be made.

iii) Revenue from product sales is stated net of returns, sales tax and applicable trade discounts and allowances.

iv) Dividend from investment is recognised as revenue when right to receive the payments is established.

v) Interest income is recognised on time proportionate basis. '

j) Depreciation and Amortisation:

Depreciation on fixed assets is provided under straight line method over their useful life as determined by the Management on the basis of technical evaluation, etc. 1 Assets I Estimated useful life Leasehold improvements Vehicles (including under finance

2 years 5 years

Furniture & Fixtures Warehouse equipments Computer Softwares Marketing Rights

5 years 3 years 3 years 10 years

k) Taxes on Income:

Income Tax is measured at the amount expected to be paid as per applicable tax rates in Philippines.

Deferred tax assets and liabilities are recognised for future tax consequence attributable to timing differences between taxable income and accounting income that are measured at relevant enacted tax rates. At each balance sheet date the company reassesses unrecognised deferred tax assets, to the extent they become reasonably certain or virtually certain of realisation, as the case may be.

I) Operating Leases:

Assets taken on lease under which all risks and rewards of ownership are effectively retained by the lessor are classified as operating lease. Lease payments under operating leases are recognised as expenses on accrual basis in accordance with the respective lease agreements.

m) Finance Leases:

Assets acquired under lease where the Company has substantially all the risks and rewards of ownership are classified as finance leases. Such assets are capitalised at the inception of the lease at the lower of the fair value or the present value of minimum lease payments and a liability is created for an equivalent amount. Each lease rental paid is allocated between the liability and the interest cost, so as to obtain a constant periodic rate of interest on the outstanding liability for each period.

'. . n) Provisions, Contingent Liabilities and Contingent Assets:

Provisions involving substantial degree of estimation in measurement are recognised when there is a present obligation as a result of past events and it is probable that there will be a n oufflow of resources. Contingent liabilities are not recognised but are disclosed in the Notes to Accounts. Contingent Assets are neither recognised nor disclosed in the financial statements.

o) Borrowing Costs:

Borrowing costs attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes a substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.

p) 1mpairment.of assets:

An asset is treated as impaired when the. carrying cost of the asset exceeds its recoverable value. An impairment loss is charged to profit and loss account in the year i r w h i c h an asset is identified as impaired. The impairment loss recognised in. prior accounting periods is reversed if there has been a change in the estimate of recoverable amount.

B) NOTES TO ACCOUNTS

1. Deferred Tax Provision:

The deferred tax assets/ (liabilities) arising o u t of significant timing differences are as under:

Particulars

Deferred Tax Liability:

Deferred Tax Assets: Allowance for impairment losses on trade receivables Retirement benefit liability Accruals for employee benefits Allowance to write-down inventories

Net Deferred Tax Assets

2. Segment Reporting:

The Company is exclusively in the Pharmaceutical business segment and has only one reportable primary and secondary reporting segment.

As at 31.03.2010

1

Particulars

Deferred Tax Liability:

Deferred Tax Assets: Allowance for impairment losses on trade receivables Retirement benefit liability Accruals for employee benefits Allowance to write-down inventories

PHP -

2,634,961

2,3 13,781 2,269,747

418,926 7,637,415

INR -

2,617,834

2,298,741 2,254,994

416,202 7,587,771

-As at 31.03.2009 PHP

-

I 2,634,961

3,008,446 2,302,742

Net Deferred Tax Assets 8,009,090

INR -

1 2,766,709

3,158,868 2,417,879

8,409,545

3. Additional information pursuant to the Provisions of Paragraphs 3, 4C, and 4D of part I1 of Schedule VI to the Companies Act, 1956.

a) Consumption of Raw Materials:

26.03.2009 to 3 1.03.2009

TOTAL

b) Value of Imported and Indigenous consumption:

Consumption of Raw Materials:

C) CIF Value of Imports:

i) Raw Materials ii) Packing Materials iii) Purchase of Traded Goods

TOTAL

Raw Materials

TOTAL

01.04.2009 to 31.03.2010 PHP 4,641,785 81 1,348

26,457,s 19 31,910,652

26.03.2009 to 31.03.2009

INR 4,641,785 8 1 1,348

26,457,s 19 31,910,652

PHP 67,700

67,700

INR 7 1,085

7 1,085

d) Expenditure in Foreign currencies on account of : 1 01.04.2009 to 31.03.2010

PHP i) Selling and Promotion expenses ii) Others

TOTAL

e) Earnings in Foreign exchange on account of:

INR

26.03.2009 to 31.03.2009

258,366 440,634 699,000

PHP -

258,366 440,634 699,000

INR -

Others

4. ana age rial Remuneration:

1 01.04.2009 to 31.03.2010

26.03.2009 to 31.03.2009

1 1 PHP 1 INR 1

0 1.04.2009 to 3 1.03.20 10

PHP -

PHP 349

INR -

INR 349

Salary and Allowances Contribution to Retirement benefits Sitting fees to Directors

TOTAL

5. Auditors Remuneration:

Salary and Allowances Contribution to Retirement benefits

TOTAL

.. 3,000,000 635,570 4 17,420

4 052,990

3,000,000 635,570 417,420

4,052,990

26.03.2009 to 3 1.03.2009

Payment to Auditors: a) As Audit Fees b) Reimbursement of out -of -pocket

expenses Total

PHP 79,643 16,873 96,s 16

INR 83,625 17,717

101,342

0 1.04.2009 to 31.03.2010 PHP

130,000 19,500

149,500

INR

130,000 19,500

149,500

6. Disclosure for lease under Accounting Standard 19 - "Leases"

Payment to Auditors: As Audit Fees

A) Finance Lease:

The Company procures transport vehicles under finance leases.

26.03.2009 to 31.03.2009

Reconciliation of Minimum Lease Payments and their Present Value as at the balance sheet date:

PHP

2,300

INR

2,415

Minimum Lease payments Less : Present Value of Minimum Lease Payments Unexpired Finance Charges

Not later than one year Later than one year but not later than five years Later than five years Total

A s on March 31,2010

Minimum Lease payments

Less : Present Value of Minimum Lease Payments Unexpired Finance Charges

PHP 23,332,623 19,570,947

3,76 1,676

As on March 3 1,20 10

INR 23,180,960 19,443,736

3,737,224

A s on March 3 1,2009

PHP

PHP 23,913,687

19,689,957

4,223,730

Minimum Lease

Payments 9,587,283

13,745,340

-

23,332,623

INR

INR 25,109,371

20,674,455

4,434,9 16

Present Value

8,151,337

11,419,610

.. .

-

19,570,947

Minimum Lease

Payments 9,524,965

13,655,995

----.

-

23,180,960

Present Value

8,098,354

1 1,345,382

-

19,443,736

A s on March 31,2009

I Lease I Value I Lease I Value I

- -

P H P Minimum I Present

Not later than

INR Minimum I Present

one year Later than one year but not later than five

Payments 10,103,329

years Later than five

B) Operating Leases :

13,8 10,358

years Total

General description of the lease:

7,735,096

-

The Company has taken on lease warehouse for a period of two (2) years u p to December 31, 2011 with the option to renew the contract. The Company has renewed on lease of existing office for a period of three (3) years up to February 14, 2013 with the option to renew the contract. The Company has taken on lease another office space for a period of seven (7) years up to March 25, 2016. On January 21, 2010, MPPI entered into a new lease agreement for additional office space for a period of three (3) years u p to February 14, 2013 with the option to renew the contract.

11,954,86 1

23,9 13,687

Rent expenses recognised in the accounts for the year ended March 31, 2010 PHP 5,126,8 19 INR 5,126,814' (previous period PHP 157,920 (INR 165,816))

Payments 10,608,495

-

The future minimum lease payments and payment profile of non cancellable operating leases are as under:

8,121,851

14,500,876

19,689,957

12,552,604

- -

25,109,371

Not later than one year Later than one year but not later than five years Later than five years Total

20,674,455

A s on 3 1.03.20 10 PHP

6,187,807 18,910,859

3,638,572 28,737,238

INR 6,147,586

18,787,938

3,614,921 28,550,445

9. Basic and Diluted Earnings per Share is calculated as under:

Not later than one year Later than one year but not later than five years Later than five years Total

As on 3 1.03.2009

Profit after Tax Weighted average number of Equity Shares : Earnings per Share - Basic & Dilutive

10. The Company makes annual contributions to a private bank to fund defined benefit plan for qualifying employees.

PHP 4,744,37 1

14,554,286

7,277,143 26,575,800

Profit after Tax

Weighted average number of Equity Shares : Earnings per Share - Basic & Dilutive

The most recent actuarial valuation of plan assets and the present value of the defined benefit obligation for retirement benefit were carried out as at March 31, 2010. The present value of the defined benefit obligations and the related current service cost and past service cost, were measured using the Projected Unit Credit-Method.

INR 4,98 1,590

15,282,000

7,64 1,000 27,904,590

01.04.2009 to 31.03.2010

The following table sets out the status of the retirement plan and the amounts recognised in the Company's financial statements as at March 31,2010

PHP 18,900,564 2,565,000

7.37

26.03.2009 to 3 1.03.2009

JNR 16,683,130 2,565,000

6.50

PHP 2,764,323

2,565,000

1.08

INR 2,902,542

2,565,000

1.13

111)

of the year

Reconciliation of PVO and fair value of plan assets:

PVO at end of year

Fair Value of planned assets at end of year

Funded status

Unrecognised actuarial gain/ (loss)

Net asset/ (liability) recognised in the balance sheet

13,442,448

8,025,130 (5,4 17,3 18)

(2,295,285)

(7,712,603)

13,355,072

7,972,967 (5,382,105)

(2,280,366)

(7,662,471)

I assets (%)

11. The year end foreign currency exposures that have not been hedged by a derivative instrument or otherwise are as below:

Amount payable in foreign currency-on .account of the following:

Particulars

Import of goods and services

Other payables

Foreign Currency

US $

US $

As on 31.03.2010

PHP

3,792,001

75,207

INR

3,767,353

74,7 18

Amount in Foreign

Currency

78,223

1,650

of pmduction and purchases d finished goods: yl&

<--PmducUoon--> <- Purchase of goods ->

Year ended 26.03.2009 to 26.03.2009 to 31.03.2009 31.03.2010 31.03.2009 Year ended on 31.03.2010 Value

lion Unit Quantity Quantity Quantity PHP INR Quantity PHP INR

17.56 Nil

0.93 Nil

No. in Million

No. in Million 1.08 7,303,936 7.303.936

- I 106.728.153 106,728.153 5,462,296 5,735,411

.pdudion quantities are quantities of goods manufactured by Vlird parties on loan lcences.

Year ended on 31.03.2010 26.03.2W9 to 31.03.2009 Value Value

Unit Quantity PHP INR Quantity PHP INR

No. in Million 48.19 275.926.484 275,926,484 2.1 11456338 12029155 I wes No. in Million 0.29 1,134.735 1.134.735 0.04 97892 102787 I gc4s: No. in Million 0.09 12,511,447 12,511.447 0.003 396129 415935

kt3 No. in Milllon 1.16 16.566.610 16.566.610 0.06 918341 9642581

TAL

@iis of finished goods stock:

Opening Stdck Closing Stock As on 01.04.2009 As on 31.03.2010

Quantity 's . Value Quantity Value !hUm UnR PHP INR PHP INR

Bls No. h Million

Utes No. in Million

bns: No. in Million

us No. in Miillon

S E s in brackets are for previous period I

13. Related Party Disclosures. as requlred by AS-18 a n glven below :

A RelaUonships Qtegory I : Holding and Ultimate holding Company:

Category II: Key Management Personnel :

Vinod Dhawan Romeo Sy Shirley SY Diwakar Kaza Chandru Chawla

Lupin Holding B.V..Netheriandr Lupin Lld , India

Chairman President Treasurer Director Dimdor

6. TnnncUons wHh the related parties. PHP

Sr. No.

1

2

3

4

5

6

26.03.2009

to 31.03.2009

Key Management

Personnel

ZS,WO,WO

63.465

67.920

Tnnractlonr

Purchase of Goods Lupln Lld

Services received Lupin Ltd

Repaymenl of loan given Romeo Sy

RemuneraUon Paid Romeo Sy

Sming Fees Chandru Chawla

Renl Paid Romeo Sy

INR

26.03.2009 to 31.03.2009

Kay Manawment

Personnel

26,250,000

66.638

71,316

01.04.2009 to 31.03.2010

Sr. No.

1

2

3

4

5

6

TnnwcUons

Purchase of Goods Lupin Lld

SON^-l I ~ W ~ V R ~

Lupin Ltd

Repayment of loan glven Romeo sy

Remunemllon Pald Romeo Sy

S~ltlnp Fees Chandru C h d a

Rent Pald Romeo Sy

01.04.2009 t o 31.03.2010

C. Balances due fmmflo the mhted

PHP

Total

6.41 8.147

1.368.125

3.635.570

417,420

3,638,580

Holdlnn Company

6.418.147

1,368,125

Holdlng Company

6.418.147

1.368.125

Key Management Personnel

3.635.570

417,420

3,638,580

26.03.2009 to 31.05.2000

M Y Management Pernonnel

67.920

Key Management

Personnel

3.635.570

417.420

. 3,638,580

Sr. No.

1

2

3

Total

5,418,147

1.368.125

'3,635,570

417.420

3.638.580

TnnsacUons

Purchase of Goods Lupin Lid

Rent payable lo Romao Sy

Sffling Fees Chandru Chawla

01.042009 to 31.03.2010

INR

Total

2,309,568

1.650

Holding Company

2,309,668

Sr. No.

1

2

3

Key Management

Personnel

1.650

Transactions

Purchase of Goods Lupin Lld

Rent payable lo R o ~ e o Sy

S i n g Fees Chendru Chawla

26.03.2009 to 31.03.2009

Kay Management Personnel

71.316

01.04.2009 to 31.03.2010

Total

2.194.668

1.639

Holding Company

2.194.668

Key Management Personnel

1.639

14. These accounts have been prepared for the year ended March 31, 2010 to comply with the provisions of Section 212 of the Companies Act, 1956. Previous period figures are for March 26, 2009 to March 31, 2009.

15. Closing exchange rate as on March 3 1, 20 10 considered for the purpose of translation as referred in l7A(e)(ii) above is Rs. 0.9935 for PHP 1.

16. Various party balances are subject to confirmation and adjustments, if any.

For MULTICARE PHARMACEUTICALS PHILIPPINES INC.

Vinod Dhawan Chandru Chawla Chairman Director

t Place: Mumbai

h Dated: April 30, 20 10

-'-XI