-
DRAFT RED HERRING PROSPECTUSAugust 6, 2015
Please refer section 32 of the Companies Act, 2013This Draft Red
Herring Prospectus will be updated upon fi ling with the RoC
Book Built Offer
ALKEM LABORATORIES LIMITEDAlkem Laboratories Limited (Company)
was incorporated as a private limited company Alkem Laboratories
Private Limited on August 8, 1973 at Patna under the Companies Act,
1956 and
subsequently became a deemed public limited company under
section 43A(2) of Companies Act, 1956 on October 26, 1988. Pursuant
to our Company passing a resolution under section 21 of Companies
Act, 1956 and upon issuance of a fresh certifi cate of
incorporation consequent on change of name dated August 21, 2001,
the name of our Company was changed to Alkem Laboratories Limited
with
effect from October 26, 1988. Pursuant to an order passed by the
Company Law Board, Kolkata, the registered offi ce of our Company
was shifted from state of Bihar to Maharashtra in the year 2007.
For further details, please refer to the chapter History and
Certain Corporate Matters on page 158.
Registered Offi ce and Corporate Offi ce: Alkem House, Senapati
Bapat Marg, Lower Parel, Mumbai 400 013, Maharashtra, India. Tel
No:+91 22 3982 9999; Fax No:+91 22 2492 7190Contact Person: Mr.
Manish Narang, Senior Vice President, Legal, Company Secretary and
Compliance Offi cer; Tel No:+91 22 3982 9999; Fax No:+91 22 2492
7190
E-mail: [email protected]; Website: www.alkemlabs.com;
Corporate Identity Number: U00305MH1973PLC174201.
PROMOTERS OF OUR COMPANY: MR. SAMPRADA SINGH, MR. BASUDEO N.
SINGH AND INDIVIDUALS IDENTIFIED AS PROMOTERS AND LISTED IN THE
CHAPTER OUR PROMOTERS, PROMOTER GROUP AND GROUP COMPANIES ON PAGE
194.
INITIAL PUBLIC OFFERING OF UPTO 12,853,442 EQUITY SHARES OF FACE
VALUE `2 EACH (EQUITY SHARES) OF OUR COMPANY FOR CASH AT A PRICE OF
`[] PER EQUITY SHARE THROUGH AN OFFER FOR SALE, BY THE SELLING
SHAREHOLDERS (DEFINED SUBSEQUENTLY) AGGREGATING UP TO `[] MILLION
(OFFER). THE OFFER INCLUDES A RESERVATION OF UP TO [] EQUITY
SHARES, AGGREGATING UP TO `[] MILLION, FOR SUBSCRIPTION BY ELIGIBLE
EMPLOYEES (AS DEFINED SUBSEQUENTLY) ON A COMPETITIVE BASIS
(EMPLOYEE RESERVATION PORTION). THE OFFER LESS THE EMPLOYEE
RESERVATION PORTION IS HEREINAFTER REFERRED TO AS THE NET OFFER.
THE OFFER AND THE NET OFFER WILL CONSTITUTE UP TO 10.75% AND [] %,
RESPECTIVELY, OF THE POST-OFFER PAID-UP EQUITY SHARE CAPITAL OF OUR
COMPANY.
THE FACE VALUE OF THE EQUITY SHARES IS ` 2 EACH. THE OFFER PRICE
IS ` [] PER EQUITY SHARE AND IS [] TIMES OF THE FACE VALUE THE
PRICE BAND, DISCOUNT, IF ANY, TO RETAIL INDIVIDUAL INVESTORS AND
ELIGIBLE EMPLOYEES AND THE MINIMUM BID LOT WILL BE DECIDED BY OUR
COMPANY AND THE SELLING SHAREHOLDERS IN CONSULTATION WITH THE
GLOBAL CO-ORDINATORS AND BOOK RUNNING LEAD MANAGERS (GCBRLMs) AND
WILL BE ADVERTISED IN ONE ENGLISH, HINDI AND MARATHI NEWSPAPERS
(MARATHI BEING THE REGIONAL LANGUAGE OF MAHARASHTRA WHERE OUR
REGISTERED OFFICE IS LOCATED), EACH WITH WIDE CIRCULATION, AT LEAST
FIVE WORKING DAYS PRIOR TO THE BID/ OFFER OPENING DATE.In case of
revision in the Price Band, the Bid/ Offer Period shall be extended
for at least three Working Days after such revision of the Price
Band, subject to the Bid/ Offer Period not exceeding 10 Working
Days. Any revision in the Price Band, and the revised Bid/ Offer
Period, if applicable, shall be widely disseminated by notifi
cation to BSE Limited (BSE) and the National Stock Exchange of
India Limited (NSE), by issuing a press release and also by
indicating the change on the websites of the GCBRLMs and at the
terminals of the Syndicate member(s).Pursuant to Rule 19(2)(b)(iii)
of the Securities Contracts (Regulation) Rules, 1957, as amended
(the SCRR), the Offer is being made for at least 10% of the
post-Offer paid-up Equity Share capital of our Company. The Offer
is being made through the Book Building Process in compliance with
regulation 26(1) of the Securities and Exchange Board of India
(Issue of Capital and Disclosure Requirements) Regulations, 2009,
as amended (SEBI ICDR Regulations), wherein 50% of the Net Offer
shall be allocated on a proportionate basis to qualifi ed
institutional buyers (QIBs). Our Company and the Selling
Shareholders may, in consultation with the GCBRLMs, allocate up to
60% of the QIB Portion to Anchor Investors (Anchor Investor
Portion) at the Anchor Investor Offer Price, on a discretionary
basis, out of which at least one-third will be available for
allocation to domestic Mutual Funds only. In the event of
under-subscription or non-allocation in the Anchor Investor
Portion, the balance Equity Shares shall be added to the Net QIB
Portion. Such number of Equity Shares representing 5% of the Net
QIB Portion shall be available for allocation on a proportionate
basis to Mutual Funds only, and the remaining Net QIB Portion shall
be available for allocation on a proportionate basis to all QIBs
(other than Anchor Investors), including Mutual Funds, subject to
valid Bids being received at or above Offer Price. Further, not
less than 15% of the Net Offer shall be available for allocation on
a proportionate basis to Non-Institutional Investors and not less
than 35% of the Net Offer shall be available for allocation to
Retail Individual Investors in accordance with SEBI ICDR
Regulations, subject to valid Bids being received from them at or
above the Offer Price. Further, [] Equity Shares shall be reserved
for allocation on a proportionate basis to Eligible Employees,
subject to valid Bids being received at or above the Offer Price.
All QIBs (other than Anchor Investors) and Non-Institutional
Investors must compulsorily and Retail Individual Investors and
Eligible Employees may optionally participate in this Offer through
the ASBA process by providing the details of their respective bank
accounts in which the corresponding Bid Amounts will be blocked by
the SCSBs. For further details please refer to the chapter Offer
Procedure on page 476.
RISKS IN RELATION TO THE FIRST ISSUEThis being the fi rst public
offering of Equity Shares of our Company, there has been no formal
market for the Equity Shares. The face value of the Equity Shares
is `2 and the Floor Price is [] times of the face value and the Cap
Price is [] times of the face value. The Offer Price (as determined
and justifi ed by our Company and the Selling Shareholders in
consultation with the GCBRLMs as stated in Basis for Offer Price on
page 99) should not be taken to be indicative of the market price
of the Equity Shares after the Equity Shares are listed. No
assurance can be given regarding an active and / or sustained
trading in the Equity Shares of our Company or regarding the price
at which the Equity Shares will be traded after listing.
GENERAL RISKSInvestment in equity and equity related securities
involves a degree of risk and investors should not invest any funds
in this Offer unless they can afford to take the risk of losing
their investment. Investors are advised to read the risk factors
carefully before taking an investment decision in this Offer. For
taking an investment decision, investors must rely on their own
examination of our Company and the Offer including the risks
involved. The Equity Shares offered in the Offer have not been
recommended or approved by the Securities and Exchange Board of
India (SEBI) nor does SEBI guarantee the accuracy or adequacy of
this Draft Red Herring Prospectus. Specifi c attention of the
investors is invited to the chapter Risk Factorson page 18.
COMPANYS AND THE SELLING SHAREHOLDERS ABSOLUTE RESPONSIBILITYOur
Company, having made all reasonable inquiries, accepts
responsibility for and confi rms that this Draft Red Herring
Prospectus contains all information with regard to our Company and
the Offer, which is material in the context of this Offer; that the
information contained in this Draft Red Herring Prospectus is true
and correct in all material aspects and is not misleading in any
material respect; that the opinions and intentions expressed herein
are honestly held; and that there are no other facts, the omission
of which makes this Draft Red Herring Prospectus as a whole or any
of such information or the expression of any such opinions or
intentions misleading in any material respect.Each Selling
Shareholder accepts responsibility only for statements in this
Draft Red Herring Prospectus in relation to itself and the Equity
Shares being sold by them through the Offer for Sale. The Selling
Shareholders do not assume any responsibility for any other
statement in this Draft Red Herring Prospectus, including without
limitation, any and all of the statements made by or relating to
the Company or its business.
LISTINGThe Equity Shares offered through this Draft Red Herring
Prospectus are proposed to be listed on BSE and NSE. The
in-principle approvals from each of BSE and NSE for listing the
Equity Shares have been received pursuant to letter no. [] dated []
and letter no. [] dated [], respectively. For the purpose of this
Offer, [] shall be the Designated Stock Exchange. A copy of the Red
Herring Prospectus and the Prospectus shall be delivered for
registration to RoC in accordance with section 26(4) of the
Companies Act, 2013. For details of the material contracts and
documents available for inspection from the date of the Red Herring
Prospectus up to the Bid/ Offer Closing Date, please refer to the
chapter Material Contracts and Documents for Inspection on page
549.
GLOBAL CO-ORDINATORS AND BOOK RUNNING LEAD MANAGERS REGISTRAR TO
THE OFFER
Nomura Financial Advisory and Securities (India) Private
LimitedCeejay House, Level 11, Plot F, Shivsagar Estate, Worli,
Mumbai 400 018,Maharashtra, India.Tel.: +91 22 4037 4037Fax: +91 22
4037 4111Email: [email protected]:
www.nomuraholdings.com/company/group/asia/india/index.htmlInvestor
grievance email: [email protected] Person:
Mr. Shreyance ShahSEBI Regn. No.: INM000011419
Axis Capital Limited1st Floor, Axis House, C-2 Wadia
International Centre, P.B. Marg, Worli, Mumbai 400 025,
Maharashtra, India.Tel.: +91 22 4325 2183Fax: +91 22 4325
3000Email:
[email protected]:www.axiscapital.co.inInvestor grievance
email: [email protected] Person:Ms. Lakha NairSEBI Regn.
No.:INM000012029
J.P. Morgan India Private LimitedJ.P. Morgan Tower, Off. C.S.T.
Road, Kalina, Santacruz (East), Mumbai 400 098, Maharashtra,
India.Tel.: +91 22 6157 3000Fax: +91 22 6157 3911Email:
[email protected]:www.jpmipl.comInvestor grievance email:
[email protected] Person: Ms. Prateeksha
Runwal SEBI Regn. No.:INM000002970
Edelweiss Financial Services Limited14th Floor, Edelweiss House,
Off. C.S.T. Road, Kalina,Mumbai 400 098,Maharashtra, India.Tel: +91
22 4086 3535Fax +91 22 4086 3610Email: al.ipo@edelweissfi
n.comWebsite:www.edelweissfi n.comInvestor grievance email:
customerservice.mb@edelweissfi n.comContact Person : Mr. Anshul
Bansal/ Mr. Siddharth ShahSEBI Regn. No.: INM0000010650
Link Intime India Private LimitedC-13, Pannalal Silk Mills
Compound, L.B.S. Marg,Bhandup (West),Mumbai 400 078, Maharashtra,
India.Tel: +91 22 6171 5400Fax: +91 22 2596 0329E-mail:
[email protected]: www.linkintime.co.in Investor
Grievance E-mail: [email protected] Person: Mr.
Sachin AcharSEBI Regn. No.: INR000004058
BID/ OFFERPROGRAMME#
FOR ALL BIDDERS: OFFER OPENS ON: []FOR QIBs: OFFER CLOSES ON**:
[]FOR ALL BIDDERS, OTHER THAN QIBs: OFFER CLOSES ON: []
#Our Company and the Selling Shareholders may, in consultation
with the GCBRLMs, may offer a discount of up to []% (equivalent of
`[]) on the Offer Price to Retail Individual Investors and Eligible
Employees. Our Company and the Selling Shareholders may, in
consultation with the GCBRLMs, consider participation by Anchor
Investors. The Anchor Investor shall bid in the Anchor Investor
Bid/ Offer Period i.e. one Working Day prior to the Bid/ Offer
Opening Date.** Our Company and the Selling Shareholders may, in
consultation with the GCBRLMs, consider closing the Bidding by QIB
Bidders one Working Day prior to the Bid/ Offer Closing Date in
accordance with the SEBI ICDR Regulations.
mailto:[email protected]:[email protected]
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Alkem Laboratories Limited
1
TABLE OF CONTENTS
SECTION I: GENERAL
......................................................................................................................................
2
DEFINITIONS AND ABBREVIATIONS
....................................................................................................
2 PRESENTATION OF FINANCIAL, INDUSTRY AND MARKET DATA
............................................. 14 FORWARD LOOKING
STATEMENTS
...................................................................................................
17
SECTION II: RISK FACTORS
........................................................................................................................
18
SECTION III: INTRODUCTION
....................................................................................................................
43
SUMMARY OF INDUSTRY
.......................................................................................................................
43 SUMMARY OF OUR BUSINESS
...............................................................................................................
45 SUMMARY FINANCIAL INFORMATION
.............................................................................................
51 THE OFFER
..................................................................................................................................................
58 GENERAL INFORMATION
......................................................................................................................
60 CAPITAL STRUCTURE
.............................................................................................................................
71
SECTION IV: PARTICULARS OF THE OFFER
.........................................................................................
98
OBJECTS OF THE OFFER
........................................................................................................................
98 BASIS FOR OFFER PRICE
........................................................................................................................
99 STATEMENT OF TAX BENEFITS
.........................................................................................................
102
SECTION V: ABOUT THE COMPANY
.......................................................................................................
115
INDUSTRY OVERVIEW
..........................................................................................................................
115 OUR BUSINESS
.........................................................................................................................................
129 KEY INDUSTRY REGULATIONS AND POLICIES
.............................................................................
149 HISTORY AND CERTAIN OTHER CORPORATE MATTERS
.......................................................... 158 OUR
SUBSIDIARIES
.................................................................................................................................
163 OUR MANAGEMENT
...............................................................................................................................
174 OUR PROMOTERS, PROMOTER GROUP AND GROUP COMPANIES
......................................... 194 DIVIDEND POLICY
..................................................................................................................................
212
SECTION VI: FINANCIAL INFORMATION
.............................................................................................
213
FINANCIAL STATEMENTS
....................................................................................................................
213 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS
OF OPERATIONS
......................................................................................................................................
358 FINANCIAL INDEBTEDNESS
................................................................................................................
382
SECTION VII: LEGAL AND OTHER INFORMATION
...........................................................................
398
OUTSTANDING LITIGATION AND MATERIAL DEVELOPMENTS
............................................. 398 LICENSES AND
APPROVALS
................................................................................................................
435 OTHER REGULATORY AND STATUTORY DISCLOSURES
........................................................... 451
SECTION VII: OFFER INFORMATION
.....................................................................................................
467
OFFER
STRUCTURE................................................................................................................................
467 TERMS OF THE OFFER
..........................................................................................................................
473 OFFER PROCEDURE
...............................................................................................................................
476
SECTION VIII: MAIN PROVISIONS OF THE ARTICLES OF ASSOCIATION
.................................. 526
SECTION IX: OTHER
INFORMATION......................................................................................................
549
MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION
................................................ 549
SECTION X: DECLARATION BY THE SELLING
SHAREHOLDERS..................................................
551
SECTION XI: DECLARATION
.....................................................................................................................
552
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Alkem Laboratories Limited
2
SECTION I: GENERAL
DEFINITIONS AND ABBREVIATIONS
This Draft Red Herring Prospectus uses certain definitions and
abbreviations which, unless the context otherwise
indicates or implies, the following terms have the meanings
given below. References to statutes, rules, regulations,
guidelines and policies will be deemed to include all amendments
and modifications notified thereto from time to
time.
The words and expressions used but not defined herein shall have
the same meaning as is assigned to such terms
under the SEBI ICDR Regulations, the Companies Act, the SCRA,
the Depositories Act and the rules and
regulations made thereunder.
Notwithstanding the foregoing, including any terms and
abbreviations used in the chapters Statement of Tax
Benefits, Financial Statements, Outstanding Litigations and
Material Developments, Our Business and
Main Provisions of the Articles of Association on pages 102,
213, 398, 129 and 526, respectively, shall have the
meanings given to such terms in these respective chapters.
General Terms
Term Description
Alkem/ our Company or
the Company
Alkem Laboratories Limited, a company incorporated under the
Companies Act, 1956,
and having its registered office at Alkem House, Senapati Bapat
Marg, Lower Parel,
Mumbai 400 013, Maharashtra, India.
We/ us/ Our Unless the context otherwise indicates or implies,
refers to our Company together with
our Subsidiaries, on a consolidated basis.
Company Related Terms
Term Description
Articles/ Articles of
Association/ AoA
The articles of association of our Company, as amended.
Auditor / Statutory
Auditor
The statutory auditors of our Company, namely, B S R & Co.
LLP, Chartered
Accountants. Board/ Board of
Directors
The board of directors of our Company or a duly constituted
committee thereof.
Ascend Our Subsidiary, Ascend Laboratories LLC
Cachet Our Subsidiary, Cachet Pharmaceuticals Private
Limited
Corporate Office The corporate office of our Company located at
Alkem House, Senapati Bapat Marg,
Lower Parel, Mumbai 400 013, Maharashtra, India.
CSR Committee The corporate social responsibility committee of
the Board of Directors.
Director(s) The director(s) of our Company.
Enzene Our Subsidiary Enzene Biosciences Limited
Equity Shares The equity shares of our Company of `2 each, fully
paid up, unless otherwise specified in the context thereof.
Group Our Company along with our Subsidiaries
Group Companies The companies, firms and ventures promoted by
our Promoters and disclosed in the
chapter Our Promoters, Promoter Group and Group Companies - Our
Group
Companies on page 194.
Independent
Director(s) Independent directors on the Board of Directors. For
details of the Independent
Directors, please refer to the chapter Our Management on page
174.
Indchemie Our Subsidiary Indchemie Health Specialities Private
Limited
Memorandum/
Memorandum of
Association/ MoA
The memorandum of association of our Company, as amended.
OAIL Olympic Agro Industries Limited
Pharmacor Our Subsidiary, Pharmacor Pty Ltd, Australia
Promoters The promoters of our Company namely, (i) Samprada
Singh, (ii) Samprada Singh
(HUF), (iii) Balmiki Prasad Singh, (iv) Manju Singh, (v)
Sarandhar Singh, (vi)
Srinivas Singh, (vii) Satish Kumar Singh, (viii) Premlata Singh,
(ix) Sarvesh Singh,
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Alkem Laboratories Limited
3
Term Description
(x) Annapurna Singh, (xi) Sandeep Singh, (xii) Inderjit Arora;
(xiii) Basudeo N.
Singh, (xiv) Rekha Singh, (xv) Dhananjay Kumar Singh, (xvi)
Madhurima Singh,
(xvii) Divya Singh, (xviii) Aniruddha Singh, (xix) Mritunjay
Kumar Singh, (xx)
Seema Singh, (xxi) Meghna Singh, (xxii) Shrey Shreeanant Singh
and (xxiii)
Archana Singh.
Promoter Group Includes such persons and entities constituting
promoter group in terms of Regulation
2 (1)(zb) of the SEBI ICDR Regulations and mentioned in the
chapter Promoter,
Promoter Group and Group Companies on page 194.
Registered Office The registered office of our Company located
at Alkem House, Senapati Bapat Marg,
Lower Parel, Mumbai 400 013, Maharashtra, India.
Registrar of
Companies / RoC
The Registrar of Companies, Mumbai located at 100, Everest,
Marine Drive Mumbai
400 002, Maharashtra, India.
Shareholders The shareholders of our Company.
Shareholders
Agreement
Shareholders Agreement dated July 13, 2015 entered into between
the Promoters
and the Company. For further details, please refer please refer
to, History and
Certain Corporate Matters Summary of Key Agreements
Shareholders
Agreement on page 161.
Shareholders Group 1 The shareholders group 1 consists of
certain of our Promoters, namely (i) Samprada
Singh, (ii) Samprada Singh (HUF), (iii) Balmiki Prasad Singh,
(iv) Manju Singh, (v)
Sarandhar Singh, (vi) Srinivas Singh, (vii) Satish Kumar Singh,
(viii) Premlata Singh,
(ix) Sarvesh Singh, (x) Annapurna Singh, (xi) Sandeep Singh and
(xii) Inderjit Arora.
Shareholders Group 2 The shareholders group 2 consists of
certain of our Promoters, namely (i) Basudeo
N. Singh, (ii) Rekha Singh, (iii) Dhananjay Kumar Singh, (iv)
Madhurima Singh, (v)
Divya Singh, (vi) Aniruddha Singh, (vii) Mritunjay Kumar Singh,
(viii) Seema Singh,
(ix) Meghna Singh, (x) Shrey Shreeanant Singh and (xi) Archana
Singh.
Selling Shareholders The selling shareholders to the Offer
namely, (i) Nawal Kishore Singh, (ii) Jayanti
Sinha, (iii) Rajesh Kumar, (iv) Rekha Singh, (v) Anju Singh,
(vi) Anita Singh, (vii)
Rajeev Ranjan, (viii) Prerana Kumar, (ix) Prabhat N Singh, (x)
Deepak Kumar Singh,
(xi) Kishore Kumar Singh, (xii) Lalan Kumar Singh, (xiii) Tushar
Kumar, (xiv)
Krishna Singh, (xv) Alok Kumar, (xvi) Ashok Kumar, (xvii) Madan
Kumar Singh,
and (xviii) Raj Kumar Singh.
Subsidiaries The subsidiaries of our Company namely, (i) Cachet
Pharmaceuticals Private
Limited, (ii) Indchemie Health Specialities Private Limited,
(iii) Enzene Biosciences
Limited, (iv) Alkem Real Estate LLP, (v) Alkem Laboratories
(Nigeria) Limited, (vi)
Alkem Laboratories (Pty) Limited, (vii) Alkem Laboratories
Corporation, (viii)
Alkem Pharma GmbH, (ix) S&B Holdings BV, (x) Pharmacor Pty
Ltd., (xi)
ThePharmaNetwork LLC, (xii) Ascend Laboratories Sdn Bhd, (xiii)
Ascend
Laboratories SpA, (xiv) Pharmacor Limited, (xv) ThePharmaNetwork
LLP, (xvi)
Alkem Laboratories Korea, Inc., (xvii) S&B Pharma Inc.
(xviii) Ascend Laboratories
LLC and (ix) Ascend Laboratories (UK) Limited.
Offer Related Terms
Term Description
Allot/ Allotment/
Allotted
Transfer of Equity Shares to successful Bidders pursuant to this
Offer.
Allotment Advice Note or advice or intimation of Allotment sent
to the Bidders who have been or are
to be Allotted Equity Shares after the Basis of Allotment has
been approved by the
Designated Stock Exchange.
Allottee A successful Bidder to whom the Allotment is made.
Anchor Investor A QIB, applying under the Anchor Investor
Portion and in accordance with the
requirements specified in the SEBI ICDR Regulations.
Anchor Investor
Allocation Price
The final price at which allocation is being done to Anchor
Investors on the Anchor
Investor Bid Period. The Anchor Investor Allocation Price will
be decided by our
Company and the Selling Shareholders in consultation with the
GCBRLMs.
Anchor Investor Bid/
Offer Period
The final day, one Working Day prior to the Bid/ Offer Opening
Date, on which Bids
by Anchor Investors shall be submitted and Allocation to Anchor
Investors shall be
completed.
Anchor Investor Offer The final price at which Equity Shares
will be Allotted to the Anchor Investors in
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Alkem Laboratories Limited
4
Term Description
Price terms of the Red Herring Prospectus and Prospectus, which
price will be equal to or
higher than the Offer Price but not higher than the Cap
Price.
Anchor Investor Portion Up to 60% of the QIB Portion which may
be allocated by our Company and the Selling
Shareholders, in consultation with the GCBRLMs, to Anchor
Investors on a
discretionary basis.
One-third of the Anchor Investor Portion shall be reserved for
domestic Mutual Funds,
subject to valid Bids being received from domestic Mutual Funds
at or above the
Anchor Investor Allocation Price.
Application Supported
by Blocked Amount/
ASBA
An application, whether physical or electronic, used by ASBA
Bidder to make a Bid
authorising a SCSB, to block the Bid Amount in their ASBA
Account.
Bids by QIBs (except Anchor Investors) and Non-Institutional
Investors should be
compulsorily made through ASBA. Anchor Investors are not
permitted to participate
through the ASBA process.
ASBA Account Account maintained with a SCSB and specified in the
Bid cum Application Form
submitted by the ASBA Bidders for blocking the extent of the
appropriate Bid
Amount specified by an ASBA Bidder in the Bid cum Application
Form.
ASBA Bidder(s) Any Bidder, other than an Anchor Investor, who
Bids in the Offer through the ASBA
process.
Axis Axis Capital Limited
Bankers to the Offer The Escrow Collection Bank(s), Refund
Bank(s) and Public Issue Bank(s).
Basis of Allotment The basis on which Equity Shares will be
Allotted to successful Bidders under the
Offer and which is described in the chapter Offer Procedure on
page 476.
Bid(s) An indication to make an offer during the Bid/ Offer
Period by a Bidder (other than
Anchor Investors) or during the Anchor Investor Bid/ Offer
Period by the Anchor
Investors, to purchase the Equity Shares from Selling
Shareholders at a price within
the Price Band, including all revisions and modifications
thereto.
Bid Amount The highest value of optional Bids indicated in the
Bid cum Application Form and
payable by the Bidder/ blocked in the ASBA Account on submission
of a Bid cum
Application Form in the Offer, which shall be net of Employee
Discount and Retail
Discount for Eligible Employees and Retail Individual Investors,
as applicable.
However for Eligible Employees applying in the Employee
Reservation Portion and
the Retail Individual Investors applying at the Cut-Off Price,
the Bid amount shall be
Cap Price multiplied by the number of Equity Shares Bid for by
such Eligible
Employee/ Retail Individual Investors and mentioned in the Bid
cum Application
Form net of Employee/ Retail Discount as the case may be.
Bid cum Application
Form
The form used by a Bidder, including ASBA Bidders, which is
serially numbered
comprising an eight digit application number, to make a Bid and
which will be
considered as the application for Allotment in terms of the Red
Herring Prospectus
and the Prospectus.
Bid/ Offer Closing Date Except in relation to any Bids received
from Anchor Investors, the date after which
the Syndicate, the Designated Branches and the Non-Syndicate
Registered Brokers
will not accept any Bids, which shall be notified in two
national daily newspapers,
one each in English and Hindi, and in one Marathi daily
newspaper, each with wide
circulation and in case of any revision, the extended Bid/ Offer
Closing Date also to
be notified on the website and terminals of the Syndicate, the
Non-Syndicate
Registered Brokers and SCSBs, as required under the SEBI ICDR
Regulations.
Our Company and the Selling Shareholders may, in consultation
with the GCBRLMs,
consider closing the Bid/ Offer Period for QIBs one Working Day
prior to the Bid/
Offer Closing Date in accordance with the SEBI ICDR Regulations
which shall be
notified in two national daily newspapers, one each in English
and Hindi, and in one
Marathi daily newspaper, each with wide circulation.
Bid/ Offer Opening
Date
Except in relation to Anchor Investor, the date on which the
Syndicate, the SCSBs
and the Non-Syndicate Registered Brokers shall start accepting
Bids which shall be
notified in two national daily newspapers, one each in English
and Hindi, and in one
Marathi daily newspaper, each with wide circulation.
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Alkem Laboratories Limited
5
Term Description
Bid/ Offer Period The period between the Bid/ Offer Opening Date
and the Bid/ Offer Closing Date,
inclusive of both days, during which prospective Bidders (except
Anchor Investors)
can submit their Bids, including any revisions thereof. The Bid/
Offer Period shall
comprise of Working Days only. Our Company and the Selling
Shareholders, in
consultation with the GCBRLMs may consider closing the Bidding
by QIB Bidders
one Working Day prior to the Bid/ Offer Closing Date, which
shall be notified in an
advertisement in same newspapers in which the Bid/ Offer Opening
advertisement
was published and in such a case the Bid/ Offer Period for the
QIBs shall be
determined accordingly.
Bid Lot [] Equity Shares
Bidder Any prospective investor who makes a Bid pursuant to the
terms of the Red Herring
Prospectus and the Bid cum Application Form, including an Anchor
Investor unless
stated or implied otherwise.
Book Building Process/
Method
The book building process as provided under Part A of Schedule
XI of the SEBI
ICDR Regulations, in terms of which this Offer is being
made.
Broker Centre Broker centres notified by the Stock Exchanges
where Bidders can submit the Bid
cum Application Forms to a Non-Syndicate Registered Broker.
The details of such Broker Centres, along with the names and
contact details of the
Non-Syndicate Registered Broker are available on the websites of
the respective
Stock Exchanges. CAN/ Confirmation of
Allocation Note
The note or advice or intimation of allocation of Equity Shares
sent to the successful
Anchor Investors who have been allocated Equity Shares after
discovery of the
Anchor Investor Offer Price, including any revisions
thereof.
Cap Price The higher end of the Price Band above which the Offer
Price will not be finalized
and above which no Bids will be accepted.
Client ID Client identification number maintained with one of
the Depositories in relation to demat account.
Cut-off Price The Offer Price, as finalised by our Company and
the Selling Shareholders in
consultation with the GCBRLMs. Only Retail Individual Investors
and Eligible
Employees bidding in the Employee Reservation Portion are
entitled to Bid at the
Cut-off Price, for a Bid Amount not exceeding `200,000 (which
shall be net of Employee Discount/ Retail Discount, as applicable).
No other category of Bidders
are entitled to Bid at the Cut-off Price.
Demographic Details The address, Bidders bank account details,
MICR code, name, status and occupation
of a Bidder
Depository A depository registered with SEBI under the
Depositories Act.
Designated Branch Such branches of the SCSBs, which shall
collect Bid cum Application Forms used
by ASBA Bidders, a list of which is available on
http://www.sebi.gov.in/
/cms/sebi_data/attachdocs/1365051213899.html or at such other
websites as may be
prescribed by SEBI from time to time.
Designated Date The date on which funds are transferred from the
Escrow Account to the Public Issue
Account or the Refund Account, as appropriate, and instructions
for transfer of the
amount blocked by the SCSB from the bank account of the ASBA
Bidder to the
Public Issue Account are provided, after the Prospectus is filed
with the RoC,
following which the Selling Shareholders shall transfer the
Equity Shares in the Offer
for Sale.
Designated Stock
Exchange/ DSE
[]
Draft Red Herring
Prospectus or DRHP
This draft red herring prospectus dated August 6, 2015 issued in
accordance with the
SEBI ICDR Regulations, filed with SEBI and which does not
contain complete
particulars of the price at which the Equity Shares would be
Alloted and the size of
the Offer.
Edelweiss Edelweiss Financial Services Limited
Eligible Employees All or any of the following:
(a) a permanent and full time employee of our Company and
Subsidiaries (excluding
such employees who are not eligible to invest in the Offer under
applicable laws,
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Alkem Laboratories Limited
6
Term Description
rules, regulations and guidelines including Promoters and
employees who are part
of the Promoter Group) as of the date of filing of the Red
Herring Prospectus with
the RoC and who continues to be an employee of our Company,
until the
submission of the Bid cum Application Form, in accordance with
applicable law;
and
(b) a Director of our Company (excluding Promoters who are
Directors11 of our
Company) who is eligible to apply under the Employee Reservation
Portion under
applicable law.
An employee of our Company, who is recruited against a regular
vacancy but is on
probation as on the date of submission of the Bid cum
Application Form will also be
deemed a permanent and a full time employee.
The maximum Bid Amount under the Employee Reservation Portion by
an Eligible
Employee shall not exceed `200,000 on a net basis.
Eligible Employees may be given a discount, at the discretion of
our Company and
the Selling Shareholders, in consultation with the GCBRLMs in
accordance with
Regulation 29 of the SEBI ICDR Regulations.
Eligible FPIs FPIs from such jurisdictions outside India where
it is not unlawful to make an offer/
invitation under the Offer and in relation to whom the Red
Herring Prospectus
constitutes an invitation to purchase the Equity Shares offered
thereby
Eligible NRIs NRI(s) from jurisdictions outside India where it
is not unlawful to make an offer or
invitation under the Offer and in relation to whom the Bid cum
Application Form and
the Red Herring Prospectus will constitute an invitation to
subscribe to or purchase
the Equity Shares
Employee Discount Our Company and the Selling Shareholders, in
consultation with the GCBRLMs,
may offer a discount of up to []% (equivalent of `[]) to the
Offer Price to Eligible Employees and which shall be announced at
least five Working Days prior to the Bid/
Offer Opening Date.
Employee Reservation
Portion Reservation of up to [] Equity Shares aggregating up to
`[] million, available for allocation to Eligible Employees on a
proportionate basis.
Escrow Account Account opened with the Escrow Collection Banks
for the Offer and in whose favour
the Bidder (except ASBA Bidders) will issue cheques or drafts in
respect of the Bid
Amount when submitting a Bid.
Escrow Agreement Agreement to be entered into by our Company,
the Selling Shareholders, the
Registrar to the Offer, the GCBRLMs, the Syndicate member(s),
the Escrow
Collection Bank(s) and the Refund Bank(s) for collection of the
Bid Amounts and
where applicable, refunds of the amounts collected from the
Bidders (excluding the
ASBA Bidders), on the terms and conditions thereof.
Escrow Collection
Banks
The banks which are clearing members and registered with SEBI
under the Securities
and Exchange Board of India (Bankers to an Issue) Regulations,
1994, with whom
the Escrow Account(s) will be opened.
First / Sole Bidder Bidder whose name shall be mentioned in the
Bid cum Application Form or the
Revision Form and in case of joint Bids, whose name shall also
appear as the first
holder of the beneficiary account held in joint names.
Floor Price Lower end of the Price Band, subject to any revision
thereto, at or above which the
Offer Price and the Anchor Investor Offer Price will be
finalised and below which
no Bids will be accepted.
GCBRLMs/ Global Co-
ordinators and Book
Running Lead
Managers
The global co-ordinators and book running lead managers to the
Offer, in this case
being Nomura Financial Advisory and Securities (India) Private
Limited, Axis
Capital Limited, J.P. Morgan India Private Limited and Edelweiss
Financial Services
Limited.
General Information
Document/ GID
The General Information Document for investing in public issues
prepared and issued
in accordance with the circular (CIR/ CFD/ DIL/ 12/ 2013) dated
October 23, 2013,
notified by SEBI, suitably modified and included in Offer
Procedure General
Information Document for Investing in Public Issues on page
488.
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Alkem Laboratories Limited
7
Term Description
Insurance Companies Any company registered with Insurance
Regulatory and Development Authority as
an insurance company.
JPM/ J.P. Morgan J.P. Morgan India Private Limited.
Listing Agreement The listing agreement to be entered into by
our Company with the Stock Exchanges.
Mutual Funds A mutual fund registered with SEBI under the
Securities and Exchange Board of
India (Mutual Funds) Regulations, 1996.
Mutual Fund Portion 5% of the Net QIB Portion or [] Equity
Shares available for allocation to Mutual
Funds, out of the Net QIB Portion.
Net Offer The Offer minus the Employee Reservation Portion.
Net QIB Portion The portion of the QIB Portion, less the number
of the Equity Shares Allotted to the
Anchor Investors.
Non-Institutional
Investors
All Bidders, including Category III FPIs, that are not QIBs or
Retail Individual
Investors and who have Bid for Equity Shares for a cumulative
amount more than
`200,000 (but not including NRIs other than eligible NRIs).
Non-Institutional
Portion
Portion of the Offer being not less than 15% of the Net Offer
consisting of [] Equity
Shares which shall be available for allocation on a
proportionate basis to Non-
Institutional Investors, subject to valid Bids being received at
or above the Offer
Price.
Nomura Nomura Financial Advisory and Securities (India) Private
Limited.
Non-Resident A person resident outside India, as defined under
FEMA and includes an NRI, FII,
FPIs and FVCI.
Non-Syndicate Broker
Centre
A broker centre of the Stock Exchanges with broker terminals,
where in a Non-
Syndicate Registered Broker may accept Bid cum Application
Forms, a list of which
is available on the website of the Stock Exchanges, and at such
other websites as may
be prescribed by SEBI from time to time.
Non-Syndicate
Registered Broker
A broker registered with SEBI under the Securities and Exchange
Board of India
(Stock Brokers and Sub Brokers) Regulations, 1992, having office
in any of the Non-
Syndicate Broker Centres, and eligible to procure Bids in terms
of the circular No.
CIR/ CFD/ 14/ 2012 dated October 4, 2012 issued by SEBI.
Offer/ Offer for Sale Initial public offering of up to
12,853,442 Equity Shares of face value of `2 each for cash at a
price of [] each by way of an Offer for Sale, aggregating up to `[]
million.
The Offer comprises of Net Offer to the public aggregating up to
`[] million and Employee Reservation Portion.
Offer Agreement The agreement dated August 6, 2015 entered into
among our Company, the Selling
Shareholders and the GCBRLMs, pursuant to which certain
arrangements are agreed
to in relation to the Offer.
Offer Price Final price at which Equity Shares will be Allotted
in terms of the Red Herring
Prospectus. The Offer Price will be decided by our Company and
the Selling
Shareholders in consultation with the GCBRLMs on the Pricing
Date.
A discount of up to []% (equivalent of `[]) per Equity Share on
the Offer Price may be offered to Retail Individual Investors and
Eligible Employees. The Rupee amount
of the such discount, if any, will be decided by our Company and
the Selling
Shareholders, in consultation with the GCBRLMs, and advertised
in [] editions of
[], [] editions of []and [] editions of [] (which are widely
circulated English,
Hindi and Marathi newspapers, Marathi being the regional
language of Maharashtra
where our Registered Office is located), at least five Working
Days prior to the Bid/
Offer Opening Date, and shall be made available to the Stock
Exchanges for the
purpose of uploading on their website.
Offer Proceeds The proceeds of the Offer. For further details,
please refer to the chapter Objects of
the Offer on page 98.
Price Band Price band of a minimum price of `[] per Equity Share
(Floor Price) and the maximum price of `[] per Equity Share (Cap
Price) including any revisions thereof.
Price Band and the minimum Bid Lot size for the Offer will be
decided by our
Company and the Selling Shareholders in consultation with the
GCBRLMs and will
be advertised, at least five Working Days prior to the Bid/
Offer Opening Date, in
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Alkem Laboratories Limited
8
Term Description
[] edition of the English national newspaper [], [] edition of
the Hindi national
newspaper [] and [] edition of the Marathi newspaper [], each
with wide
circulation.
Pricing Date The date on which our Company and the Selling
Shareholders in consultation with
the GCBRLMs finalise the Offer Price.
Prospectus The prospectus to be filed with the RoC in accordance
with section 26 of the
Companies Act, 2013 and the SEBI ICDR Regulations, containing,
inter alia, the
Offer Price that is determined at the end of the Book Building
process, the size of the
Offer and certain other information.
Public Issue Account The bank accounts opened with the Public
Issue Banks by the Selling Shareholders
under section 40(3) of the Companies Act, 2013 to receive money
from the Escrow
Accounts on the Designated Date and where the funds shall be
transferred by the
SCSBs from the ASBA Accounts.
Public Issue Banks The banks which are clearing members and
registered with SEBI under the Securities
and Exchange Board of India (Bankers to an Issue) Regulations,
1994 with whom the
Public Issue Account(s) will be opened.
Qualified Institutional
Buyers or QIBs
Qualified institutional buyers as defined under Regulation
2(1)(zd) of the SEBI ICDR
Regulations.
QIB Portion The portion of the Offer of [] Equity Shares
required to be allocated to QIBs.
Red Herring
Prospectus/ RHP
Red herring prospectus to be issued in accordance with section
32 of the Companies
Act, 2013 and the provisions of the SEBI ICDR Regulations, which
will not have
complete particulars of the price at which the Equity Shares
will be offered and the
size of the Offer.
Red Herring Prospectus will be registered with the RoC at least
three days before the
Bid/ Offer Opening Date and will become the Prospectus upon
filing with the RoC
after the Pricing Date.
Refund Account The account(s) opened with Refund Bank(s), from
which refunds (excluding to the
ASBA Bidders), if any, of the whole or part of the Bid Amount
shall be made.
Refund Banks The banks which are clearing members and registered
with SEBI under the Securities
and Exchange Board of India (Bankers to an Issue) Regulations,
1994 with whom the
Refund Account will be opened.
Refunds through
electronic transfer of
funds
Refunds through electronic transfer of funds means refunds
through NECS, Direct
Credit, NEFT or RTGS, as applicable.
Registrar/ Registrar to
the Offer
Registrar to this Offer, in this case being Link Intime India
Private Limited.
Restated Consolidated
Financial Information
Consolidated financial statement of assets and liabilities as at
March 31, 2015, 2014,
2013, 2012 and 2011 and statement of profit and loss and
statement of cash flows for
each of the years ended March 31, 2015, 2014, 2013, 2012 and
2011 for our
Company, its Subsidiaries read alongwith all the notes thereto,
restated in accordance
with the SEBI ICDR Regulations, which have been prepared and
presented under the
historical cost convention using the accrual system of
accounting in accordance with
the Indian GAAP and requirements of Companies Act, 1956 (up to
March 31, 2014)
and notified sections, schedules and rules of the Companies Act
(w.e.f. April 1, 2014)
including accounting standards as prescribed by the Companies
(Accounting
Standard) Rules, 2006 as per Section 211(3c) of the Companies
Act, 1956 (which are
deemed to be applicable as Section 133 of Companies Act read
with Rule 7 of
Companies (Accounts) Rules, 2014, to the extent applicable) and
included in the
section Financial Statements on page 213
Restated Standalone
Financial Information
Standalone financial statement of assets and liabilities as at
March 31, 2015, 2014,
2013, 2012 and 2011 and statement of profit and loss and
statement of cash flows for
each of the years ended March 31, 2015, 2014, 2013, 2012 and
2011 for our Company
read alongwith all the notes thereto, restated in accordance
with the SEBI ICDR
Regulations, which have been prepared and presented under the
historical cost
convention using the accrual system of accounting in accordance
with the Indian
GAAP and requirements of Companies Act, 1956 (up to March 31,
2014) and
notified sections, schedules and rules of the Companies Act
(w.e.f. April 1, 2014)
including accounting standards as prescribed by the Companies
(Accounting
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Alkem Laboratories Limited
9
Term Description
Standard) Rules, 2006 as per Section 211(3c) of the Companies
Act, 1956 (which are
deemed to be applicable as Section 133 of Companies Act read
with Rule 7 of
Companies (Accounts) Rules, 2014, to the extent applicable) and
included in the
section Financial Statements on page 213
Retail Discount Our Company and the Selling Shareholders, in
consultation with the GCBRLMs,
may decide to offer a discount of `[] per Equity Share to the
Offer Price to Retail Individual Investors and which shall be
announced at least five Working Days prior
to the Bid/ Offer Opening Date.
Retail Individual
Bidders / Retail
Individual Investors /
RIIs
Individual Bidders, submitting Bids, who have Bid for Equity
Shares for an amount
not more than `200,000 in any of the bidding options in the Net
Offer (including HUFs applying through their Karta and Eligible
NRIs and does not include NRIs other
than Eligible NRIs).
Retail Portion/ Retail
Category
The portion of the Offer being not less than 35% of the Net
Offer available for
allocation to Retail Individual Investor(s) in accordance with
the SEBI ICDR
Regulations, subject to valid Bids being received at or above
the Offer Price.
Revision Form Form used by Bidders, including ASBA Bidders, to
modify the quantity of the Equity
Shares or the Bid Amount in any of their Bid cum Application
Forms or any previous
Revision Form(s).
QIB Bidders and Non-Institutional Investors are not allowed to
lower their Bids (in
terms of quantity of Equity Shares or the Bid Amount) at any
stage.
Self-Certified Syndicate
Bank or SCSBs
The banks which are registered with SEBI under the Securities
and Exchange Board
of India (Bankers to an Issue) Regulations, 1994 and offer
services in relation to
ASBA, including blocking of an ASBA Account in accordance with
the SEBI ICDR
Regulations and a list of which is available on http:/ /
www.sebi.gov.in/ sebiweb/
home/ list/ 5/ 33/ 0/ 0/ Recognised Intermediaries or at such
other website as may be
prescribed by SEBI from time to time.
Share Escrow
Agreement
Agreement to be entered into between the Selling Shareholders,
our Company and the
Escrow Agent in connection with the transfer of Equity Shares
under the Offer for
Sale by the Selling Shareholders and credit of such Equity
Shares to the demat account
of the Allottees.
Specified Locations Bidding centres where the Syndicate shall
accept Bid cum Application Forms
from ASBA Bidders, a list of which is available on the website
of SEBI
(http://www.sebi.gov.in) and updated from time to time
Sub Syndicate
member(s)
A SEBI Registered member of BSE and/ or NSE appointed by the
GCBRLMs and /
or Syndicate member(s) to act as a Sub Syndicate member(s) in
the Offer.
Syndicate Includes the GCBRLMs and Syndicate member(s).
Syndicate Agreement The agreement to be entered into between the
GCBRLMs, the Selling Shareholders,
the Syndicate member(s) and our Company in relation to the
collection of Bids
(excluding Bids by ASBA Bidders) in this Offer.
Syndicate ASBA
Centres
Bidding Centres where an ASBA Bidder can submit his Bid cum
Application Form
to the Syndicate member(s) and prescribed by SEBI from time to
time.
Syndicate member(s) An intermediary registered with the SEBI to
act as a syndicate member(s) and who
is permitted to carry on the activity as an underwriter in this
case being [].
Transaction Registration
Slip/ TRS
The slip or document issued by member of the Syndicate or the
SCSB (only on
demand), as the case may be, to the Bidder as proof of
registration of the Bid.
U.S. QIB Qualified institutional buyers, as defined in Rule 144A
under Securities Act.
Underwriters The GCBRLMs and the Syndicate member(s).
Underwriting
Agreement
The agreement among the Underwriters, the Selling Shareholders
and our Company
to be entered into on or after the Pricing Date.
Working Day Any day, other than Saturdays and Sundays, on which
commercial banks in Mumbai
are open for business, provided however, for the purpose of the
time period between
the Bid/ Offer Closing Date and listing of the Equity Shares on
the Stock Exchanges,
Working Days shall mean all days excluding Sundays and bank
holidays in
Mumbai in accordance with the SEBI Circular no. CIR/ CFD/ DIL/
3/ 2010 dated
April 22, 2010.
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Alkem Laboratories Limited
10
Technical/ Industry Related Terms / Abbreviations
Term Description
Asst. Assistant
ANDA Abbreviated New Drug Application
APIs Active pharmaceutical ingredients
C&F Clearing and Forwarding
CDSCO Central Drugs Standard Control Organization of India
CEO Chief Executive Officer
CFO Chief Financial Officer
cGMP Current Good Manufacturing Practices
DESI Drug Efficacy Study Implementation
DPCO 2013 Department of Pharmaceuticals released the revised
Drugs (Price Control) Order,
2013
DCGI Drug Controller General of India
DMF Drug Master Files
EMA European Medicine Agency
EPCG Export Promotion Capital Goods
Fax Facsimile
FDA Food and drugs administration
FDC Drugs Fixed dose combination drugs
FSSAI Food Safety and Standards Authority of India
FTFs First-to-files
GCP Good clinical practices
GLP Good laboratory practices
GMP Good manufacturing processes
ICDS Income Computation and Disclosure Standards
IMS Health IMS Health Information and Consulting Services India
Private Limited
NDA New drug application
NHAM National Health Assurance Mission
NLEM National List of Essential Medicines
NPPA National Pharmaceutical Pricing Authority
Sr. Senior
Tel. Telephone
TGA Therapeutic Goods Administration, Australia
WHO World Health Organisation
UCPMP Uniform Code of Pharmaceutical Marketing Practices
UK-MHRA The Medicines and Healthcare Products Regulatory Agency
in the United Kingdom
USFDA United States Food and Drug Administration
V.P. Vice President
Conventional and General Terms/ Abbreviations
Term Description
AGM Annual general meeting
AIF(s) Alternative investment funds, as defined in, and
registered with SEBI under the
Securities and Exchange Board of India (Alternative Investment
Funds) Regulations,
2012.
AS Accounting standards issued by the Institute of Chartered
Accountants of India
AY Assessment year
BPLR Bank prime lending rate
BG Bank guarantee
BR Base rate
BSE BSE Limited
Bn/ bn Billion
CAGR Compounded annual growth rate
CC Cash credit
CCI Competition Commission of India
CDSL Central Depository Services (India) Limited
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Alkem Laboratories Limited
11
Term Description
CIN Corporate identity number
CIT Commissioner of Income Tax
CLB Company Law Board
CSR Corporate social responsibility
CST Central Sales Tax
CST Act The Central Sales Tax Act, 1956
CST Rules The Central Sales Tax (Registration and Turnover)
Rules, 1957
Category I Foreign
Portfolio Investors
FPIs that are registered as Category I foreign portfolio
investors under the SEBI
FPI Regulations.
Category II Foreign
Portfolio Investors
FPIs that are registered as Category II foreign portfolio
investors under the SEBI
FPI Regulations.
Category III Foreign
Portfolio Investors
FPIs that are registered as Category III foreign portfolio
investors under the SEBI
FPI Regulations.
Consolidated FDI
Policy
Consolidated FDI Policy (Circular 1 of 2015) dated May 12, 2015
issued by the
Department of Industrial Policy and Promotion, Ministry of
Commerce and Industry,
Government of India, and any modifications thereto or
substitutions thereof, issued
from time to time.
Companies Act, 1956 The Companies Act, 1956 (without reference
to the provisions thereof that have
ceased to have effect upon notification of the sections of the
Companies Act, 2013)
along with the relevant rules made thereunder.
Companies Act/
Companies Act, 2013
The Companies Act, 2013, to the extent in force pursuant to the
notification of
sections of the Companies Act, 2013, along with the relevant
rules made thereunder.
Competition Act The Competition Act, 2002
DCA and Rules Drugs and Cosmetics Act, 1940 and Drugs and
Cosmetics Rules, 1945
DIN Director identification number
DIPP Department of Industrial Policy and Promotion, Ministry of
Commerce and Industry,
Government of India
DP ID Depository participant identification
Depositories NSDL and CDSL
Depositories Act The Depositories Act, 1996
EPS Earnings per share
EOU Export oriented unit
Europe MAA Europe Marketing Authorisation Application
FCNR Account Foreign currency non-resident account
FDI Foreign direct investment
FEMA
The Foreign Exchange Management Act, 1999 read with rules and
regulations
thereunder and amendments thereto
FEMA Regulations The Foreign Exchange Management (Transfer or
Issue of Security by a Person
Resident Outside India) Regulations 2000 and amendments
thereto.
FII(s) Foreign Institutional Investors as defined under the SEBI
FPI Regulations. FPI(s) Foreign Portfolio Investors as defined
under the SEBI FPI Regulations.
fiscal year/ Fiscal/ FY Period of 12 months ended March 31 of
that particular year, unless otherwise stated.
FIPB Foreign Investment Promotion Board
FLC Foreign letter of credit
FVCI Foreign Venture Capital Investor, as defined in and
registered with SEBI under the
SEBI FVCI Regulations
GAAR General anti-avoidance rule
GDP Gross domestic product
GoI/ Government Government of India
GST Goods and Services Tax
HNI High net worth individual
HUF Hindu undivided family
ICAI Institute of Chartered Accountants of India
IFRS International Financial Reporting Standards
IPO Initial public offering
ILC Inland letter of credit
IRDA Insurance Regulatory and Development Authority
I.T. Act The Income Tax Act, 1961
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Alkem Laboratories Limited
12
Term Description
Indian GAAP Generally Accepted Accounting Principles in
India
Ind AS Indian Accounting Standard
Insider Trading
Regulations
The Securities and Exchange Board of India (Prohibition of
Insider Trading)
Regulations, 2015
KMP/ Key Management
Personnel/ Key
Managerial Personnel
Key management personnel defined under section 2(1)(s) of the
SEBI ICDR
Regulations and includes the officers vested with executive
powers and the officers
at the level immediately below the Board and defined more
particularly in Our
Management Key Management Personnel on page 190.
LER Loan equivalent risk
Libor London interbank offer rate
LOC Letters of credit
LOU Letter of undertaking
LLP Act The Limited Liability Partnership Act, 2008
MAT Minimum alternate tax
MCA Ministry of Corporate Affairs, Government of India
MICR Magnetic ink character recognition
Mn / mn Million
MOU Memorandum of understanding
Mutual Fund(s) Mutual Fund(s) means mutual funds registered
under the Securities and Exchange
Board of India (Mutual Funds) Regulations, 1996.
NA/ N.A. Not Applicable
NAV/ Net Asset Value Net Asset Value being paid up equity share
capital plus free reserves (excluding
reserves created out of revaluation) less deferred expenditure
not written off
(including miscellaneous expenses not written off) and debit
balance of Profit and
Loss account, divided by number of issued Equity Shares.
NCR National capital region
NECS National electronic clearing services
NEFT National electronic fund transfer
Net Worth Net worth means the aggregate of the paid up share
capital, share premium account,
and reserves and surplus (excluding revaluation reserve).
NOC No objection certificate.
Notified Sections The sections of the Companies Act, 2013 that
have been notified by the MCA and are
currently in effect.
NR Non-resident
NRE Account Non-resident external account
NRI An individual resident outside India who is a citizen of
India or is an Overseas
Citizen of India cardholder within the meaning of Section 7 (A)
of the Citizenship
Act, 1955.
NRO Account Non-resident ordinary account
NSDL National Securities Depository Limited
NSE National Stock Exchange of India Limited
OCB/ Overseas
Corporate Body
A company, firm, partnership, society or other corporate body
owned directly or
indirectly to the extent of at least 60% by NRIs including
overseas trusts, in which
not less than 60% of beneficial interest is irrevocably held by
NRIs directly or
indirectly and which was in existence on October 3, 2003 and
immediately before
such date had taken benefits under the general permission
granted to OCBs under
FEMA. OCBs are not allowed to invest in this Offer, except with
the specific
permission of the RBI.
p.a. Per annum
P/ E Ratio Price/ earnings ratio
PAN Permanent account number allotted under the Income Tax Act,
1961.
PAT Profit after tax
PBT Profit before tax
PCFC Packing Credit in Foreign Currency
PIO Persons of Indian origin
PLR Prime lending rate
RBI The Reserve Bank of India
RBI Act The Reserve Bank of India Act, 1934
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Alkem Laboratories Limited
13
Term Description
RONW Return on Net Worth
`/ Rs./ Rupees/ INR Indian Rupees
RTGS Real time gross settlement
SAP Systems, Applications and Products in Data Processing
SCRA The Securities Contracts (Regulation) Act, 1956
SCRR The Securities Contracts (Regulation) Rules, 1957
SCSB Self-certified syndicate bank
SEBI The Securities and Exchange Board of India constituted
under the SEBI Act.
SEBI Act The Securities and Exchange Board of India Act,
1992
SEBI AIF Regulations The Securities and Exchange Board of India
(Alternative Investment Funds)
Regulations, 2012
SEBI FII Regulations The Securities and Exchange Board of India
(Foreign Institutional Investors)
Regulations, 1995
SEBI FPI Regulations The Securities and Exchange Board of India
(Foreign Portfolio Investors)
Regulations, 2014 SEBI FVCI Regulations The Securities and
Exchange Board of India (Foreign Venture Capital Investors)
Regulations, 2000
SEBI ICDR Regulations The Securities and Exchange Board of India
(Issue of Capital and Disclosure
Requirements) Regulations, 2009
SEBI Takeover
Regulations
The Securities and Exchange Board of India (Substantial
Acquisition of Shares and
Takeovers) Regulations, 2011
SEBI VCF Regulations The erstwhile Securities and Exchange Board
of India (Venture Capital Funds)
Regulations, 1996
Securities Act U.S. Securities Act of 1933, as amended
SIA Secretariat of Industrial Assistance, Department of
Industrial Policy & Promotion,
Ministry of Commerce and Industry, Government of India
SPV Special Purpose Vehicle
Sr. Senior
STT Securities transaction tax
State Government The government of a state of the Union of
India
Stock Exchange(s) BSE and/ or NSE, as the context may refer
to
UK The United Kingdom
US / U.S./ United States The United States of America
US GAAP Generally Accepted Accounting Principles in the United
States of America
USD/ US$/ U.S.$ United States Dollars
VAT Value added tax VCFs Venture Capital Funds as defined and
registered with SEBI under the SEBI VCF
Regulations
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Alkem Laboratories Limited
14
PRESENTATION OF FINANCIAL, INDUSTRY AND MARKET DATA
Certain Conventions
All references to India in this Draft Red Herring Prospectus are
to the Republic of India and all references to
the U.S., USA or United States are to the United States of
America. Further, all references to following
countries are:
Sr. No. Reference Country
1. Australia The Commonwealth of Australia
2. Chile The Republic of Chile
3. Germany The Federal Republic of Germany
4. Kenya The Republic of Kenya
5. Malaysia The Federation of Malaysia
6. Netherlands The Kingdom of Netherlands
7. Nigeria The Federal Republic of Nigeria
8. Philippines The Republic of the Philippines
9. South Africa The Republic of South Africa
10. South Korea The Republic of Korea
11. U.K., UK or United Kingdom The United Kingdom of Great
Britain and Northern Ireland
Financial Data
Unless stated otherwise, the financial information in this Draft
Red Herring Prospectus is derived from our
Restated Consolidated Financial Information and Restated
Standalone Financial Information. The above stated
financial information is restated in accordance with the SEBI
ICDR Regulations, which have been prepared and
presented under the historical cost convention using the accrual
system of accounting in accordance with the
Indian GAAP and requirements of Companies Act, 1956 (up to March
31, 2014) and notified sections, schedules
and rules of the Companies Act (w.e.f. April 1, 2014) including
accounting standards as prescribed by the
Companies (Accounting Standard) Rules, 2006 as per Section
211(3c) of the Companies Act, 1956 (which are
deemed to be applicable as Section 133 of Companies Act read
with Rule 7 of Companies (Accounts) Rules, 2014,
to the extent applicable).
In this Draft Red Herring Prospectus, all figures in decimals
have been rounded off to the first decimal and all
percentage figures have been rounded off to one decimal places
and accordingly there may be consequential
changes in this Draft Red Herring Prospectus.
Our Companys fiscal year commences on April 1 and ends on March
31 of the next year; accordingly, all
references to a particular fiscal year, unless stated otherwise,
are to the 12 month period ended on March 31 of
that year.
There could be significant differences between Indian GAAP, US
GAAP and IFRS. The reconciliation of the
financial information to IFRS or US GAAP financial information
has not been provided. Our Company has not
attempted to explain those differences or quantify their impact
on the financial data included in this Draft Red
Herring Prospectus and we urge investors to consult your own
advisors regarding such differences and their
impact on our Companys financial data. For details in connection
with risks involving differences between
Indian GAAP and IFRS, please refer to Risk Factors Significant
differences could exist between Indian GAAP
and other accounting principles, such as U.S. GAAP and IFRS,
which may affect investors assessments of our
Companys IND IFRS financial condition on page 39. Accordingly,
the degree to which the financial
information included in this Draft Red Herring Prospectus will
provide meaningful information is entirely
dependent on the readers level of familiarity with Indian
accounting policies and practices, Indian GAAP, the
Companies Act and the SEBI ICDR Regulations. Any reliance by
persons not familiar with Indian accounting
policies, Indian GAAP, the Companies Act, the SEBI ICDR
Regulations and practices on the financial
disclosures presented in this Draft Red Herring Prospectus
should accordingly be limited.
Unless the context otherwise indicates, any percentage amounts,
as set forth in Risk Factors, Our Business,
Managements Discussion and Analysis of Financial Conditional and
Results of Operations on pages 18, 129
and 358 respectively, and elsewhere in this Draft Red Herring
Prospectus have been calculated on the basis of
the Restated Consolidated Financial Information and Restated
Standalone Financial Information of our
Company.
https://upload.wikimedia.org/wikipedia/commons/5/50/RepChile.ogg
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Alkem Laboratories Limited
15
Currency and Units of Presentation
All references to:
Rupees or ` or INR or Rs. are to Indian Rupee, the official
currency of the Republic of India;
USD or US$ are to United States Dollar, the official currency of
the United States of America;
Euro or EUR are to Euro, the official currency of the European
Union and consequently, the official currency of the Kingdom of
Netherlands; and
All references to the following currencies refer to the official
currencies of countries mentioned below:
Sr. No. Currency Country 1. Australian dollar or AUD or $
Australia
2. Chilean peso or CLP or $ Chile
3. Euro or EUR or Germany
4. Kenyan shilling or KES or Sh Kenya
5. Malaysian ringgit or MYR or RM Malaysia
6. Euro or EUR or Netherlands
7. Nigerian naira or NGN or Nigeria
8. Philippine peso or PHP or Philippines
9. South African rand or ZAR or R South Africa
10. South Korean won or KRW or South Korea
11. British pound or GBP or U.K., UK or United Kingdom
Except otherwise specified, our Company has presented certain
numerical information in this Draft Red Herring
Prospectus in million units. One million represents 1,000,000
and one billion represents 1,000,000,000.
Exchange Rates
This Draft Red Herring Prospectus contains conversion of certain
other currency amounts into Indian Rupees
that have been presented solely to comply with the SEBI ICDR
Regulations. These conversions should not be
construed as a representation that these currency amounts could
have been, or can be converted into Indian
Rupees, at any particular rate or at all.
The following table sets forth, for the periods indicated,
information with respect to the exchange rate between
the Rupee and other currencies:
(in `) Currency As on March 31,
2011 2012 2013 2014 2015
1 USD(1) 44.6 50.9 54.3 59.9 62.5
1 AUD(2) 46.1 52.9 56.6 55.3 47.5
1 Chilean peso(3) 0.1 0.1 0.1 0.1 0.1
1 (4) 63.4 67.9 69.5 82.7 67.2
100 Kenyan shilling(5) 53.6 61.3 63.5 69.3 67.6
1 RM(6) 14.9 16.9 17.4 18.3 16.8
1 NGN(7) 0.3 0.3 0.3 0.4 0.3
1 Philippine peso(8) 1.0 1.2 1.3 1.3 1.4
1 Rand(9) 6.6 6.6 5.9 5.7 5.1
1 KRW(10) 0.0 0.0 0.0 0.1 0.1
1 (11) 71.8 81.5 82.2 99.8 92.5 Source:
(1) Foreign Exchange Dealer Association of India - Fedai.org.in
(2) Foreign Exchange Dealer Association of India - Fedai.org.in (3)
Oanda.com (4) Foreign Exchange Dealer Association of India -
Fedai.org.in
https://en.wikipedia.org/wiki/Chilean_pesohttps://en.wikipedia.org/wiki/Kenyan_shillinghttps://en.wikipedia.org/wiki/Malaysian_ringgithttps://en.wikipedia.org/wiki/Nigerian_nairahttps://en.wikipedia.org/wiki/Philippine_pesohttps://en.wikipedia.org/wiki/South_African_randhttps://en.wikipedia.org/wiki/South_Korean_wonhttps://en.wikipedia.org/wiki/Pound_sterlinghttps://en.wikipedia.org/wiki/Chilean_pesohttps://en.wikipedia.org/wiki/Kenyan_shillinghttps://en.wikipedia.org/wiki/Philippine_peso
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Alkem Laboratories Limited
16
(5) Foreign Exchange Dealer Association of India - Fedai.org.in
(6) Oanda.com (7) Oanda.com (8) Oanda.com (9) Foreign Exchange
Dealer Association of India - Fedai.org.in (10) Oanda.com (11)
Foreign Exchange Dealer Association of India - Fedai.org.in
In case March 31 of any of the respective years is a public
holiday, the previous calendar day not being a public
holiday has been considered.
Industry and Market Data
Unless stated otherwise, industry and market data used in this
Draft Red Herring Prospectus has been obtained
or derived from publicly available information as well as
various industry publications and sources.
Industry publications generally state that the information
contained in such publications has been obtained from
publicly available documents from various sources believed to be
reliable but their accuracy and completeness
are not guaranteed and their reliability cannot be assured.
Accordingly, no investment decision should be based
on such information. Although we believe the industry and market
data used in this Draft Red Herring Prospectus
is reliable, it has not been independently verified by us, the
Selling Shareholders or the GCBRLMs or any of
their affiliates or advisors. The data used in these sources may
have been re-classified by us for the purposes of
presentation. Data from these sources may also not be
comparable.
The extent to which the market and industry data used in this
Draft Red Herring Prospectus is meaningful
depends on the readers familiarity with and understanding of the
methodologies used in compiling such data.
There are no standard data gathering methodologies in the
industry in which business of our Company is
conducted, and methodologies and assumptions may vary widely
among different industry sources.
Such data involves risks, uncertainties and numerous assumptions
and is subject to change based on various
factors. Accordingly, investment decisions should not be based
solely on such information.
This Draft Red Herring Prospectus includes industry related
information from a report published by CRISIL
Research, a division of CRISIL Limited. CRISIL Research (CRISIL)
has consented to the use of such
information in the Draft Red Herring Prospectus subject to the
following disclosure:
CRISIL Research, a division of CRISIL Limited (CRISIL) has taken
due care and caution in preparing this
report (Report) based on the Information obtained by CRISIL from
sources which it considers reliable
(Data). However, CRISIL does not guarantee the accuracy,
adequacy or completeness of the Data / Report and
is not responsible for any errors or omissions or for the
results obtained from the use of Data / Report. This Report
is not a recommendation to invest / disinvest in any company
covered in the Report. CRISIL especially states that
it has no liability whatsoever to the subscribers / users /
transmitters/ distributors of this Report. CRISIL Research
operates independently of, and does not have access to
information obtained by CRISILs Ratings Division /
CRISIL Risk and Infrastructure Solutions Ltd (CRIS), which may,
in their regular operations, obtain
information of a confidential nature. The views expressed in
this Report are that of CRISIL Research and not of
CRISILs Ratings Division / CRIS. No part of this Report may be
published/reproduced in any form without
CRISILs prior written approval.
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Alkem Laboratories Limited
17
FORWARD LOOKING STATEMENTS
This Draft Red Herring Prospectus contains certain
forward-looking statements. These forward-looking
statements can generally be identified by words or phrases such
as will, aim, will likely result, believe,
expect, will continue, anticipate, estimate, intend, plan,
contemplate, seek to, future,
objective, goal, project, should, will pursue and similar
expressions or variations of such expressions.
All statements contained in this Draft Red Herring Prospectus
that are not statements of historical fact constitute
forward-looking statements. All statements regarding our
expected financial condition and results of operations,
business, plans, objectives, strategies, goals and prospects are
forward-looking statements.
Forward-looking statements reflect our current views with
respect to future events and are not a guarantee of
future performance. These statements are based on our
managements beliefs and assumptions, which in turn are
based on currently available information. Although our Company
believes the assumptions upon which these
forward-looking statements are based to be reasonable, any of
these assumptions could prove to be inaccurate,
and the forward-looking statements based on these assumptions
could be incorrect.
Further, the actual results may differ materially from those
suggested by the forward-looking statements due to
risks or uncertainties associated with our expectations with
respect to, but not limited to, regulatory changes
pertaining to the pharmaceutical industry in India in which our
Company operates and our ability to respond to
them.
Important factors that could cause actual results to differ
materially from our expectations include, but are not
limited to, the following:
1. Price fluctuation due to Drug Prices Control Order and NLEM;
2. Our ability to successfully implement our strategy, growth and
expansion plans; 3. Our ability to identify market trends and
customer preferences early on and to leverage this information
successfully;
4. The outcome of legal or regulatory proceedings that our
Company is or might become involved in; 5. Contingent liabilities,
environmental problems and uninsured losses; 6. Government
approvals; 7. Changes in government policies and regulatory actions
that apply to or affect our business; 8. Developments affecting the
Indian economy; and 9. Uncertainty in global financial markets.
We cannot assure investors that the expectation reflected in
these forward-looking statements will prove to be
correct. Given these uncertainties, investors are cautioned not
to place undue reliance on such forward-looking
statements and not to regard such statements as a guarantee of
future performance.
By their nature, certain risk disclosures are only estimates and
could be materially different from what actually
occurs in the future. As a result, actual future gains or losses
could materially differ from those that have been
estimated. Our Company, the Directors, the GCBRLMs and their
respective affiliates or associates do not have
any obligation to, and do not intend to, update or otherwise
revise any statements reflecting circumstances arising
after the date hereof or to reflect the occurrence of underlying
events, even if the, underlying assumptions do not
come to fruition. In accordance with the SEBI ICDR Regulations,
our Company and the GCBRLMs will ensure
that investors in India are informed of material developments
until such time as the grant of listing and trading
permissions by the Stock Exchanges for the Equity Shares
allotted pursuant to the Offer. Each of the Selling
Shareholders will ensure that investors are informed of material
developments in relation to statements and
undertakings made by such Selling Shareholder in the Red Herring
Prospectus until the time of the grant of listing
and trading permission by the Stock Exchanges.
All forward looking statements are subject to risks,
uncertainties and assumptions about us that could cause our
actual results to differ materially from those contemplated by
the relevant forward looking statement. For further
discussion of factors that could cause our actual results to
differ from our expectations, please refer to the chapters
Risk Factors, Our Business and Managements Discussion and
Analysis of Financial Condition and Results
of Operation on pages 18, 129 and 358, respectively.
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Alkem Laboratories Limited
18
SECTION II: RISK FACTORS
An investment in the Equity Shares involves a high degree of
risk. You should carefully consider all
information in this Draft Red Herring Prospectus, including the
risks and uncertainties described below, before
making an investment in the Equity Shares. If any or some
combination of the following risks actually occur,
our business, prospects, results of operations and financial
condition could suffer, the trading price of the
Equity Shares could decline and you may lose all or part of your
investment. In addition, the risks set out in this
section may not be exhaustive and additional risks and
uncertainties not presently known to us, or which we
currently deem to be immaterial, may arise or may become
material in the future. Unless specified in the relevant
risk factor below, we are not in a position to quantify the
financial implication of any of the risks mentioned below.
Any potential investor in the Equity Shares should pay
particular attention to the fact that we are subject to
extensive regulatory environment that may differ significantly
from one jurisdiction to other. In making an
investment decision, prospective investors must rely on their
own examination of us on a consolidated basis and
the terms of the Offer including the merits and the risks
involved. To obtain a complete understanding of our
business, you should read the sections Our Business and
Managements Discussion and Analysis of Financial
Condition and Result of Operations on pages 129 and 358,
respectively. If our business, result of operations or
financial condition suffers, the price of the Equity Shares and
the value of your investments in the Equity Shares
could decline.
This Draft Red Herring Prospectus also contains forward looking
statements, which refers to future events that
produce known and unknown risks, uncertainties and other
factors, many of which are beyond our control, which
may cause the actual results to be materially different from
those expressed or implied by the forward looking
statements. Please refer to the chapter Forward Looking
Statements on page 17.
In this section, unless the context otherwise requires, a
reference to our Company refers to Alkem Laboratories
on a stand-alone basis and we, us and our refers to Alkem
Laboratories Limited, and our Subsidiaries on
a consolidated basis. Unless otherwise stated or the context
otherwise requires, the financial information used in
this section is derived from our Restated Consolidated Financial
Information and Restated Standalone Financial
Information, as applicable.
Risks relating to our Business
1. There are outstanding litigations involving our Company, our
Promoters, our Directors and our Subsidiaries.
Our Company, our Promoters, our Directors and our Subsidiaries
are involved in certain legal proceedings
which are pending at different levels of adjudication before
various courts, tribunals and appellate authorities.
We cannot provide assurance that these legal proceedings will be
decided in our favour. Decisions in such
proceedings adverse to such person/ entitys interests may have a
significant adverse effect on our business,
results of operations, cash flows and financial condition.
A summary of the pending civil and criminal proceedings
involving our Company, our Promoters, our
Directors and our Subsidiaries is provided below:
Litigations against our Company
Category Company
No. of
Proceedings
Amount, to the extent quantifiable (` million)
Criminal Complaints 20 2.4
Civil Proceedings 16 2.2
Tax Proceedings (Direct and Indirect) 73 1,324.7
Labour Matters 23 3.3
Litigations by our Company
Category Company
No. of Proceedings Amount, to the extent quantifiable (`
million) Criminal Proceedings 45 56.2
Civil Proceedings 11 28.9
Labour Matters 6 Nil
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Alkem Laboratories Limited
19
Litigations against Indchemie
Category Subsidiaries
No. of Proceedings Amount, to the extent quantifiable (`
million) Criminal Complaints 5 Nil
Civil Proceedings Nil Nil
Tax Proceedings (Direct and Indirect) 3 2.7
Labour Matters Nil Nil
Litigations by Indchemie
Category Subsidiaries
No. of Proceedings Amount, to the extent quantifiable (`
million) Criminal Complaints 25 2.4
Civil Proceedings 1 Nil
Labour Matters Nil Nil
Litigations against Cachet
Category Subsidiaries
No. of Proceedings Amount, to the extent quantifiable (`
million) Criminal Complaints 3 Nil
Civil Proceedings Nil Nil
Tax Proceedings (Direct and Indirect) 17 110.1
Labour Matters 1 0.4
Litigations by Cachet
Category Subsidiaries
No. of Proceedings Amount, to the extent quantifiable (`
million) Criminal Complaints 9 8.5
Civil Proceedings Nil Nil
Labour Matters Nil Nil
Litigations against our Promoters
Category Promoters
No. of Proceedings Amount, to the extent quantifiable (`
million) Criminal Complaints 18 2.1
Civil Proceedings 2 Nil
Tax Proceedings (Direct and Indirect) Nil Nil
Labour Matters Nil Nil
Litigations against our Directors
Category Directors
No. of Proceedings Amount, to the extent quantifiable (`
million) Criminal Complaints 18 2.1
Civil Proceedings 2 Nil
Tax Proceedings (Direct and Indirect) Nil Nil
Labour Matters Nil Nil
For further details of legal proceedings involving the Company,
our Promoters, our Directors and our
Subsidiaries, please refer to the chapter Outstanding Litigation
and Material Developments on page 398.
In addition to the aforementioned legal proceedings there are
notices / summons issued against our Company
from time to time. For further ddetails please refer to
Outstanding Litigation and Material Developments -
Notices against our Company on page 431. Furthermore, if
significant claims are determined against us and
we are required to pay all or a portion of the disputed amount,
there could be a material adverse effect on our
business, results of operations, financial conditions and
prospects. We are currently, and may in the future
be, implicated in lawsuits in the ordinary course of business,
including lawsuits and arbitrations and counter
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Alkem Laboratories Limited
20
claims. Litigations and arbitrations could result in substantial
costs and a diversion of efforts and attention of
our management and/or subject us to significant liabilities to
third parties.
2. Our business is subject to extensive regulation. If we fail
to comply with the applicable regulatio