Nectar Lifescience Ltd Management Discussions

An overview of the economy

Current Overview of the World Economy

The global economy is facing a number of challenges in 2023, including the after impact of COVID-19 pandemic, the war in Ukraine, and rising inflation. These challenges are expected to slow global growth from 6.1% in 2021 to 3.6% in 2022 and 2023. Despite these challenges, there are some positive signs as well for the global economy. The labour market is very strong in some countries, and corporate profits are at record levels. These factors could help to support economic growth in the coming months.

The following are some of the key economic indicators for the global economy in 2023:

• Global GDP growth: 3.6%

• Inflation: 5.7% in advanced economies, 8.7% in emerging market and developing economies

• Unemployment: 5.5% in advanced economies, 7.5% in emerging market and developing economies

The following are some of the key risks to the global economy in 2023:

• The COVID-19 pandemic: The pandemic weaned away but there are impending impacts of covid will take some time to come back to normal by end of 2023 and till then, it could continue to disrupt economic activity and lead to higher unemployment.

• The war in Ukraine: The war could continue to disrupt trade and lead to higher energy prices.

• Rising inflation: Rising inflation could erode the purchasing power of consumers and make it more difficult for businesses to operate.

Sources:

• International Monetary Fund (IMF). World Economic Outlook, April 2023.

• World Bank. Global Economic Prospects, January 2023.

• Organization for Economic Cooperation and Development (OECD). Economic Outlook, June 2022.

• International Monetary Fund. (2023, April 11). World Economic Outlook: April 2023. Retrieved from https://www.imf.org/en/Publications/WEO/Issues/2023/04/11/world-economic-outlook-april-2023

Current Overview of Indian Economy– Continues to show resilience

The Indian economy is expected to grow at 6.4% in fiscal year 2023 and 6.7% in fiscal year 2024. The growth will be driven by private consumption and investment, supported by government policies. Private consumption is expected to grow due to improving labour market conditions and consumer confidence. The governments commitment to increasing capital expenditure, even with a lower fiscal deficit target, will also stimulate demand. The services sector is projected to grow strongly as the impact of the COVID-19 pandemic subsides, while manufacturing growth is expected to improve in fiscal year 2024. Measures to boost agricultural productivity will contribute to sustained growth in the agricultural sector.

Despite the positive outlook, there are risks to Indias economic growth, including geopolitical tensions and weather-related shocks. These factors could impact the countrys economic performance in the near future.

The governments focus on a balanced monetary policy and efforts to stimulate investment will be crucial in sustaining Indias economic growth in the coming years.

Citations:

1. Asian Development Bank (ADB). "India Economy to Grow 6.4% in FY2023, Rise to 6.7% in FY2024." ADB.org. https://www.adb.org/news/india-economy-grow

2. https://www2.deloitte.com/us/en/insights/economy/asia-pacific/india-economic-outlook.html 3. https://www.worldbank.org/en/news/press-release/2023/04/04/ indian-economy-continues-to-show-resilience-amid-global-uncertainties

The Expanding Landscape of the Pharmaceutical Industry in India

The Indian pharmaceutical industry is one of the fastest-growing industries in the world. It is currently valued at $50 billion and is projected to reach $65 billion by 2024 and $130 billion by 2030. India is a major exporter of pharmaceuticals, serving over 200 countries worldwide. It caters to more than 50% of Africas demand for generics, approximately 40% of the generic demand in the United States, and around 25% of the UKs total medicine requirement. India also plays a pivotal role in meeting global vaccine demand, accounting for approximately 60% of the market. The country stands as a leading supplier of essential vaccines such as DPT, BCG, and Measles vaccines. Remarkably, 70% of the World Health Organizations vaccines, as per the essential Immunization schedule, are sourced from India.

The Indian pharmaceutical industry is thriving due to a number of factors, including:

• A strong domestic market: India has a large and growing population, which creates a large domestic market for pharmaceuticals.

• A skilled workforce: India has a large pool of skilled scientists and engineers who are well-trained in the pharmaceutical industry.

• Favourable government policies: The Indian government has implemented a number of policies that are favourable to the pharmaceutical industry, such as tax breaks and subsidies.

• Access to global markets: India has access to global markets through a number of free trade agreements.

The Indian pharmaceutical industry is poised for continued growth in the coming years. The industry is expected to benefit from rising demand for generics and vaccines, as well as from the governments focus on improving healthcare access.

The Cephalosporin Space

Indias Potential in Antibiotic Production - Cephalosporins are a class of antibiotics that are effective against a wide range of bacteria, including those that are resistant to other antibiotics. They are typically well-tolerated by patients and have few side effects. India is a major producer of cephalosporins, with a large capacity for production and a long history of manufacturing. Indian cephalosporins are exported to a wide range of countries, including the United States, Europe, and Japan.

The demand for cephalosporins is expected to grow in the coming years, due to the increasing prevalence of infectious diseases, the rise of antibiotic resistance, and the aging population. India is well-positioned to meet this growing demand, with the resources, expertise, and production capacity to be a major supplier of cephalosporins in the global market.

There are a number of challenges that India faces in the cephalosporin space, including the need to invest in research and development, and the need to improve the quality of control systems. However, India has the potential to be a major player in the global cephalosporin market, with the resources, expertise, and production capacity to be a major supplier of cephalosporins in the coming years.

Here are some additional facts and figures about the cephalosporin market in India:

• The Indian anti-infective market, including cephalosporins, has already reached $3.4 billion by 2023 and is growing at a CAGR of 17%.

• India is the worlds largest producer of generic cephalosporins.

• The Indian pharmaceutical industry is expected to grow at a CAGR of 10% in the next decade.

• India has a large pool of skilled and experienced scientists and engineers who are working in the pharmaceutical industry.

• India has a strong regulatory framework for the pharmaceutical industry.

These factors make India an attractive destination for investment in the cephalosporin space.

About Nectar Lifesciences Limited

Nectar Lifesciences Limited ("Nectar" or "Company") is a global pharmaceutical company with a strong focus on the production and development of cephalosporins. The company has a long history of innovation, a broad product portfolio, global reach and has a strong track record of success in the cephalosporin market.

Nectar is well-positioned to become a global leader in the cephalosporin market. Its commitment to R&D will help the company to continue to develop new and improved cephalosporins that meet the needs of patients around the world.

In addition to the strengths mentioned above, Nectar also has a number of other factors that could help it to become a global leader in the cephalosporin market. These factors include:

• Commitment to sustainability: The companys manufacturing processes are designed to minimize environmental impact. Nectars commitment to sustainability is a positive factor that could help the company to attract customers and investors.

• Positive reputation: Nectar has a positive reputation in the pharmaceutical industry. The company is known for its high-quality products and its commitment to patient safety. Its positive reputation will help the company to attract customers and investors.

Nectar has a strong hold of API & Formulation business in almost 66 countries. It has state-of-the-art manufacturing facilities spread across Punjab and Himachal Pradesh with compliance to global standards of cGMP, Environment Health Safety (EHS). It also has hundreds of highly skilled, knowledgeable, competent and qualified workforce at all levels.

1. APIs & Intermediates

Nectar is one of the leading manufacturers of Cephalosporin range of products - oral and Sterile APIs – at its two units in Derabassi Punjab. It has been certified multiple times by global regulatory authorities such as USFDA, EUGMP INFARMED, COFEPRIS, KFDA, PMDA, MCC, and ANVISA Brazil. The Companys Unit 2 is dedicated to catering to regulated markets and is one of Asias best sterile facilities with the least amount of human intervention.

The Companys competitive advantage lies in its flexibility to produce multiple products in the same manufacturing facilities and its deep knowledge and chemistry skills in diverse and challenging therapeutic domains. Nectar is also one of the few companies in India which possess both Lyophilisation and Crystallisation facilities.

Production is carried out in dedicated production units, each unit coupled to a fully dedicated isolated finishing suite. The Company maintains stringent controls through its institutionalized Quality Management Systems (QMS) that covers the entire production cycle - from raw materials, manufacturing to packaging and dispatch.

The Company has a process development R&D unit that continues to work on the improvement in quality, cost optimisation and enrich the product basket to emerge as cost effective player. Currently, the API business team is exploring new avenues of growth through new products, new markets, and new customers.

2. Formulations/Finished Dosage Formulations ("FDF") Nectar has a strong presence in the formulation space. The FDF facility at Baddi, Himachal Pradesh has best-in-class assets operated by a talented and energetic team capable to scale up the operations with efficiency and quality expectations. The FDF facility has also been recognised & approved by regulatory bodies like INFARMED Portugal for European Union, ANVISA Brazil, OGYI Hungary for European Union, Pharmacy & Poison Board Kenya, NMRC Namibia, NDA Uganda, TFDA and others.

The Companys products are marketed to the ROW markets such as Southeast Asia, Latin America, the Commonwealth of Independent States (CIS), and Africa. The Company has filed two of its major Cephalosporin Formulations in Europe in its bid to enter regulated markets of the world and is expanding its business in Europe.

3. Menthol & Mint derivatives

Leveraging its pharmaceutical mindset and discipline, Nectar has created a niche for itself in this otherwise highly unorganised business space. As of now, the Company has scaled down this business to create more value-added business in future. The Company is reworking its technology and facility for this product line. Its global-sized processing capacities and world-class production practices have the capabilities positioned Nectar as a leader in the Menthol Arena, again.

The Company is re-focusing on this section by working on new technologies to produce value added products so that it becomes a niche and specialized product rather than commodity model.

4. Empty Hard Gelatin Capsules

Nectars state-of-the-art Empty Hard Gelatin Capsules (EHGC) manufacturing facility allows it to cater to Indias 120 billion capsule EHGC market, continually growing at a healthy pace. The Company has a production capacity of 4 billion capsule shells enabling it to feature among the Top 5 EHGC manufacturers in India catering to domestic & export markets. It is also the only unit to follow unique concept of SMSR (Single Machine Single Room). The Companys two-piece double lock Gelatin Capsules are manufactured in compliance with cGMP requirements of US FDA and EDQM norms.

Nectar has recently launched two new innovative products in EHGC menthol capsules (Nexxicap MintyTM) and pearl capsules (Nexxicap PearlTM)

Some of the prominent features of our capsules are:

• DMF filed

• All printing options (linear, circular, spiral, oriented, non-oriented etc)

• Different Sizes (0, Oel,1,2,3)

• 5-year shelf life

• Ethylene oxide free

• BSE & TSE Free

Annual Report 2022-23/ 14

• Halal certification

• Manufactured with pharmaceutical Drug Master File & EDQM (The European Directorate for the Quality of Medicines & HealthCare) certified Gelatin.

However, being a non-core business, the Company is endeavouring to dispose off this business.

Regulatory filings

Nectar has a pipeline of 101 Drug Master Files (DMFs) filing till date in regulated markets like the US, EU, Japan, Korea, Canada and South Africa for its Cephalosporin APIs, intermediates, capsules shells and menthol. The Company has also filed dossiers for its formulations in large and growing markets, which are at an advanced stage in the approval lifecycle.

Citations -

• World Economic Situation and Prospects as of mid-2023

• United Nations Department of Economic and Social Affairs. (2023). World Economic Situation and Prospects as of mid-2023. New York: United Nations. Retrieved from https:// www.un.org/development/desa/dpad/publication/world-economic-situation-and-prospects-as-of-mid-2023/

• International Monetary Fund World Economic Outlook

• International Monetary Fund. (2023). World Economic Outlook: War in Ukraine – Economic Implications. Washington, DC:

International Monetary Fund. Retrieved from https:// www.imf.org/en/Publications/WEO

• OECD Economic Outlook Organisation for Economic Cooperation and Development. (2023). OECD Economic Outlook, Volume 2023 Issue 1: Rising to the Crises: Policy Challenges and Next Steps. Paris: OECD Publishing. Retrieved from https://www.oecd.org/economic-outlook/march-2023/

Financial performance

Continuing from the information about the financial performance from the Boards Report, the further highlights of financial performance are as under:

Particulars	FY23	FY22
EBITDA* Margin (%)	6.43	10.20
Profit (Loss) Before Tax Margin (%)	(2.67)	2.06
Profit (Loss) After Tax Margin (%)	(1.47)	1.52

* EBITDA – Earning before interest, tax, depreciation and amortization.

Details of significant changes (i.e., change of 25% or more as compared to the immediately previous FY) in key financial ratios has been provided in Note no. 2.51 of Standalone Financial Statements, along with detailed explanations thereof. However, the ratios not provided in the said note are provided hereunder:

Key financial ratios	FY23	FY22	Change %	Numerator/ Denominator	Detailed Explanation in case change is more than 25%:
(i) Interest Coverage Ratio	0.49	1.44	(-)66	(EBIT*/Interest)	Due to rise in raw material and power & fuel costs, the EBIT reduced.
(ii) Operating Profit Margin (%)	(-)0.29	6.10	(-)105	(Operating Margin / Net Sale)	Due to rise in raw material and power & fuel costs, the operating margin reduced

* EBIT – Earning before interest and tax

Return on Net worth [Profit (Loss) After Tax/ Net Worth*]

FY23	FY22	Detailed Explanation
(-)2.09%	2.33%	Profit for the year reduced due to rise in raw material and power & fuel costs, thereby return on Net worth reduced

* Net worth is calculated on average basis. Also refer to Note 2.51 in financial statements i.e. return on average equity.

Assessing the precise after impact of Covid-19 wave on the companys operations and financials remains challenging. However, the Indian economy is projected to experience significant growth in the fiscal years 2023 and 2024. Private consumption and investment will be the key drivers, buoyed by favourable government policies. Factors such as improving labour market conditions, increased consumer confidence, and the governments focus on capital expenditure will stimulate demand and bolster private consumption.

Internal Control System and adequacy

Given the current economic downturn, the significance of internal control review has amplified. Continuous evaluations are conducted to monitor and assess the effectiveness of the implemented internal control system, ensuring alignment with the Board of Directors intentions. The Internal Control is intended to increase transparency and accountability in an organizations process of designing and implementing a system of internal control. This process aids in identifying any deficiencies in internal controls, prompting corrective actions to be taken.

The Company has established a comprehensive system of internal controls to safeguard its assets against unauthorized use and to ensure the reliability of financial reporting.

The Company has aligned its internal financial control system with the requirement of Companies Act, 2013 to enhance operational effectiveness, efficiency, and compliance with regulations. These controls are integrated into automated internal business processes, a centralized global process framework, and key support functions. Nectars internal controls are commensurate with its size and the nature of its operations. These have been designed to provide reasonable assurance with regard to recording and providing reliable financial and operational information, complying with applicable statutes, safeguarding assets from unauthorized use, executing transactions with proper authorization and ensuring compliance with corporate policies. Nectar has a well-defined delegation of power with authority limits for approving contracts as well as expenditure. All transactions are recorded and reported in accordance with the Indian Accounting Standards. Nectars management assessed the effectiveness of the companys internal control over financial reporting as defined in Regulation 17 of LODR Regulations as of March 31, 2023. M/s Deepak Jindal & Co., Chartered Accountants, the statutory auditors of Nectar have audited the financial statements and have issued an attestation report on the companys internal control over financial reporting as defined in section 143 of the Act. Nectar has appointed Mr. Aman Singla, Chartered Accountant to oversee and carry out internal audit of its activities. The audit is based on an internal audit plan, which is reviewed and approved by the Audit Committee.

Nectar also undergoes periodic audit by specialized third party consultants and professionals for business specific compliances such as quality management, service management, information security, etc. The Audit Committee reviews audit reports submitted by internal auditors and statutory auditors. Suggestions for improvement are considered and the audit committee follows up on corrective action.

Outlook

With the world gradually recovering from the impact of Covid-19, our business is experiencing a resurgence. The supply chain for antibiotics was severely affected, leading to shortages caused by disruptions and lockdowns. Furthermore, material flow was restricted, outpatient departments (OPDs) were non-operative, and elective surgeries were scarce.

However, as the global effects of the pandemic subside, we anticipate a normalization of the demand and supply of antibiotics, resulting in a stabilization of our business. Once the situation normalizes, we expect to witness the projected growth of our business. To capitalize on this opportunity, Nectar will focus on expanding its customer base and increasing its share of existing customers. Our exceptional support and performance during challenging times have enhanced our credibility with customers, providing a strong foundation for further growth. As part of our business growth strategy, the Company is pursuing a shift in the market and customer mix, adopting a more FDF focused approach. By aligning our efforts with this approach, we aim to achieve our business goals and propel the company along a trajectory of sustained growth.

SWOT Analysis of Nectar Strengths:

1. Established Presence: Nectar is one of the largest players in the Cephalosporin industry with operations in many countries. Its widespread presence provides a strong foundation for global expansion and market reach.

2. World-Class Facilities: The company boasts world-class manufacturing facilities, equipped with advanced technologies and adhering to international quality standards. This allows Nectar to produce high-quality pharmaceutical products efficiently.

3. Strong Capacity: Nectar has a robust production capacity, enabling it to meet the growing demand for Cephalosporin products in the market. This gives the company a competitive advantage in fulfilling customer needs and ensuring timely delivery.

4. Location Advantage: Being based in India, Nectar benefits from lower manufacturing costs, access to a skilled workforce, and proximity to a large pool of raw materials. This helps maintain cost efficiency and competitiveness in the industry.

5. Technological expertise: The company possesses advanced technology and expertise in the production of Cephalosporin API, enabling it to deliver high-quality products efficiently and maintain a competitive edge in the market.

6. Extensive product portfolio: The company offers a wide range of Cephalosporin API products, catering to diverse customer needs and increasing its market share. The broad product portfolio also allows for cross-selling and upselling opportunities.

7. Strong regulatory approvals: With approvals from renowned regulatory bodies such as USFDA, EUGMPA, ANVISA, PMDA, and others, the company demonstrates high-quality manufacturing practices and compliance with international standards, enhancing its reputation and market credibility.

8. Cost advantage: Being based in India, the company can benefit from lower manufacturing and operational costs compared to many developed countries. This cost advantage can contribute to competitive pricing and higher profit margins.

9. Established global capacities: The company has significant manufacturing capabilities for Cephalosporin API, allowing it to cater to global demand and compete effectively in the market.

Opportunity

1. Growing Global Demand: The increasing demand for Cephalosporin products worldwide presents significant opportunities for Nectar. Expanding its market presence and capturing a larger share of this growing demand can lead to substantial revenue growth.

2. Emerging Markets: Exploring and expanding into emerging markets where healthcare infrastructure and pharmaceutical demand are rapidly growing can provide Nectar with new avenues for expansion and revenue generation.

3. Product Innovation: Investing in research and development to introduce new and improved Cephalosporin products can give the company a competitive edge and help capture a larger market share. Innovations in formulation, delivery methods, or combination therapies could create differentiation in the market.

4. Growing demand for Cephalosporin API: The global demand for Cephalosporin API is increasing due to the rising prevalence of bacterial infections and the need for effective antibiotics. The company can capitalize on this growing market by expanding its production capacities and meeting the demand.

5. Expansion into emerging markets: The company can explore opportunities to expand its presence in emerging markets, where the demand for Cephalosporin API is rising rapidly. By establishing strategic partnerships or distribution networks, the company can gain a competitive advantage and increase its market share.

6. Research and development: Investing in research and development activities can help the company develop new formulations, improve existing products, and enhance its product pipeline. This will enable the company to meet evolving customer needs, differentiate itself from competitors, and capture new market opportunities.

Threat

1. Stringent regulatory environment: Regulatory requirements for pharmaceutical manufacturing are becoming increasingly stringent worldwide. The company needs to stay updated with evolving regulations and ensure continuous compliance to avoid any penalties or disruptions in operations.

2. Supply chain disruptions: Any disruptions in the supply of raw materials or intermediates, whether due to natural disasters, geopolitical factors, or logistical issues, can affect the companys production capabilities and lead to delays or increased costs.

3. Price pressure: Intense competition and cost-conscious buyers can exert downward pressure on product prices, potentially affecting the companys profitability. The ability to effectively manage costs becomes key.

Human resource

Nectar, a company led by industry professionals who are dedicated and skilled in their work, recognizes the value of each employee as an asset. With a commitment to training, enrichment, retention, and talent acquisition, Nectar allocates significant resources and employs effective strategies. To foster continuous learning and development, Nectar follows the Human Resource (HR) policy outlined below:

• Attract, develop, and retain talented individuals at all organizational levels.

• Cultivate a performance-oriented culture by continuously enhancing capabilities and motivating employees.

• Encourage leadership at every level through trust, empowerment, and openness.

• Foster a collaborative approach to achieve business excellence.

• Cultivate a vibrant work culture based on innovation and productivity.

Nectars HR learning and development initiatives are aligned with the requirements of a rapidly growing organization. As the company embraces new strategies and faces fresh challenges each year, its processes, technology, and, most importantly, its people experience immediate impact. Continual learning is ingrained in the companys culture, enabling employees to be more productive and adapt to increased responsibilities. Notably, shop floor resources are encouraged to focus on key development areas, given their role as implementers and their responsibility for maintaining necessary cGMP compliance levels. These executives receive comprehensive training in compliance management, aligning with the companys goals and fostering a sense of value within the organization.

Employee Welfare

Nectar undertakes the following activities as a part of Employee Welfare services:

• Safety Services

• Skill development training

• Personal protective equipment

• Basic Facilities for Welfare of Employees

• Ambulatory services at the workplace

EHS

Nectars EHS (Environment Health & Safety Cell) strictly adheres to the US Environmental Protection Agencys principles of Green Chemistry to comply & fulfill in-house mandatory guidelines. The Company has framed the EHS policy with following objectives:

1. To protect and promote environment conservation by minimising adverse impact of its business operations on environment.

2. To strive for low carbon emission.

3. To conserve natural resources and promote 3Rs –Reduction, reuse and recycle.

4. To recognize employees as its most important asset and to provide a safe and healthy work environment.

5. To prevent injuries and occupational illnesses and ensure safety and good health of employees and stakeholders.

Whistle Blower Policy/ Vigil Mechanism

The company has made the Whistle Blower Policy for the employees of the company where employees are given the freedom to disclose to the management- any instances of unethical behaviour, actual or suspected, fraud or violation of the companys code of conduct or ethics policy. As per policy:

1. No unfair treatment will be meted out to a Whistle Blower by virtue of his/her having reported a Protected Disclosure under this Policy.

2. The Company condemns any discrimination, harassment, victimization, or other unfair employment practice being adopted against Whistle Blowers.

3. Complete protection will be given to Whistle Blowers against any unfair practice like retaliation, threat or intimidation of termination/suspension of service, disciplinary action, transfer, demotion, refusal of promotion, or the like including any direct or indirect use of authority to obstruct the Whistle Blowers right to continue to perform his duties/functions including making further Protected Disclosure.

Risk management Approach

Risk management plays a vital role in identifying and mitigating threats that could significantly impact an organization. Nectar recognizes the importance of proactive and effective risk management, understanding that while risks cannot be eliminated entirely, they can be significantly reduced.

To enhance risk management efficiency, the company identifies and evaluates the risks it faces in pursuit of its objectives. These risks are then categorized as critical or non-critical based on their potential impact.

Nectars framework for enterprise risk management focuses on identifying potential events that could hinder objective achievement. The company sets objectives aligned with its mission and risk appetite, ensuring a systematic process is in place.

A Risk Management Committee, chaired by Mr. Sanjiv Goyal, Chairman & Managing Director and comprising members Dr. Rupinder Tewari, Independent Director and Mr. Amit Chadah, Chief Executive Officer of the Company has been established. The committee conducts constructive discussions, incorporating inputs from functional heads, and submits regular reports to the Board regarding risk mitigation measures.

Here are some identified risks, their impact, and mitigation strategies:

1. Competition Risk: Cephalosporin manufacturers pose a threat to the companys sales. Nectars economies of scale, strong customer relationships, proficient R&D team, and cost optimization efforts give it a competitive advantage.

2. Regulatory Risk: Various countries have implemented additional and upgraded regulations. Nectar has a dedicated team monitoring the global regulatory environment, ensuring compliance and alignment through a robust quality assurance mechanism and continuous training.

3. Global Economic Volatility Risks: Nectars diverse customer base across the globe makes it susceptible to policy changes in different countries. The company maintains regular communication with global customers through its marketing and regulatory affairs team, proactively aligning with evolving frameworks.

4. Patent Protection Risks: To prevent infringement, Nectar has a dedicated team of scientists that conducts thorough studies of existing patents during new product or process development stages.

5. Raw Material Import Risks: Reliance on raw material imports, particularly from China, presents risks. Nectar is actively working to broaden its vendor base and develop substitute inputs to decrease dependence.

6. People Risks: Nectars effective HR strategy covers various aspects such as learning and development, recruitment, benefits administration, compensation management, performance appraisal, employee and labour relations, and compliance management, ensuring stability and continuous growth.

7. Financial Risks: Nectar addresses financial risks through high standards of corporate governance and compliance, cash management services to manage liquidity risk, creditworthiness assessments, provisions for bad debts, and prudent measures for foreign exchange and interest rate management.

8. Commodity Risks: The volatility of commodity prices can impact the business. Nectar tackles this challenge by procuring materials against specific orders and maintaining a strong export base, providing a safety net for raw material procurement.

By actively identifying and managing these risks, Nectar strives to maintain a resilient and secure operational environment, supporting the companys long-term growth and success.

	For and on behalf of the Board of Directors
	of Nectar Lifesciences Limited
	(Sanjiv Goyal)
Place: Chandigarh	Chairman & Managing Director
Date: 26-05-2023	DIN: 00002841