Sun Pharmaceutical Industries Limited (SUNPHARMA) Earnings Call Transcript & Summary

Good afternoon, everybody. Myself, Anoop Deshpande, Company Secretary and Compliance Officer, welcome all the members and members of the Board of Directors to this 31st Annual General Meeting of Sun Pharmaceutical Industries Limited. In compliance with circulars issued by Ministry of Corporate Affairs and the Securities and Exchange Board of India, this meeting is being conducted through video conference or other video visual -- audiovisual means. I shall now introduce you to the directors who have joined this meeting. Dr. Pawan Goenka, Lead Independent Director, is attending the meeting from Mumbai. Dr. Goenka is also the Chairman of the Nomination and Remuneration Committee. Also, as there is no permanent Chairman to the Board at this point of time, Dr. Goenka, who is the Lead Independent Director, would act as the Chairman of this meeting pursuant to the terms and conditions of appointment of Lead Independent Director. Mr. Dilip Shanghvi, Managing Director of the company, is attending the meeting from Mumbai. Mr. Shanghvi is also the Chairman of the Risk Management Committee. Mr. Gautam Doshi, Independent Director, is attending the meeting from Mumbai. Mr. Doshi is also the Chairman of the Corporate Governance and Ethics Committee, Audit Committee and Stakeholders' Relationship Committee. Ms. Rama Bijapurkar, Independent Director, is attending the meeting from Bangalore. Ms. Bijapurkar is also the Chairperson of the Corporate Social Responsibility Committee. Mr. Sanjay Asher, Independent Director, is attending the meeting from Mumbai. Mr. Rolf Hoffmann, Independent Director, is attending the meeting from Montenegro. Mr. Sudhir Valia, Non-Exec Director, is attending the meeting from Mumbai. Mr. Sailesh Desai, Whole Time Director, is attending the meeting from Mumbai. Mr. Aalok Shanghvi, Whole Time Director, is attending the meeting from Mumbai. Mr. C.S. Muralidharan, Chief Financial Officer, has also joined this meeting from Mumbai. We also have representatives of SRBC & CO LLP, statutory auditors, KJB & Co. LLP, secretarial auditors, K D & Company, cost auditors of the company, attending this meeting. [Operator Instructions] All the books, records, registers, as required under the Companies Act 2013 and delivered documents referred to in the Notice of 31st Annual General Meeting are available for inspection electronically during the meeting. As per the requirement of SEBI regulations and Companies Act 2013, remote e-voting facility was made available to the members from August 24, 2023, to August 27, 2023, to cast their votes on each of the resolutions set out in the said notice of 31st AGM. Mr. Chintan Goswami, partner of KJB & Co. LLP and, failing him, Mr. Alpeshkumar Panchal, partner of KJB & Co., shall act as the scrutinizer for e-voting process. After all the resolutions as per the Notice of 31st AGM are placed, the floor will be open for shareholder questions. With this, I now hand over the proceedings of the meeting to the Chairman of the meeting, Dr. Pawan Goenka. Over to you, sir.

Thank you, Anoop. Dear shareholders, good afternoon. I hope you all are doing well and enjoyed witnessing the successful landing of Vikram on the moon. I welcome you all at this 31st Annual General Meeting of the company. I also welcome my fellow board members. The company has taken adequate steps to enable shareholders to participate in the meeting through video conferencing and to cast their vote by electronic means. We have requisite quorum present to conduct the proceedings of this meeting. [Operator Instructions] I now request Mr. Dilip Shanghvi, Managing Director, to share updates on the company's performance and business.

Dear fellow shareholders, on behalf of the Board of Directors, I welcome all of you to the 31st AGM of your company. I hope you and your family members are doing well. I shall begin by sharing key trends of the global pharmaceutical industry. Following a rebound in global medicine use in 2021 after the pandemic, growth slowed in 2022 and spending inched up from USD 1.42 trillion to USD 1.48 trillion. Global pharmaceutical spending is projected to grow by a CAGR of 3% to 6% between '23 and '27 and to reach total market size of approximately USD 1.9 trillion. The growth is expected to be primarily driven by the introduction of novel medicines. This will be offset by the loss of exclusivity and the lower cost of generics and biosimilars. Regional spending and volume growth trends will continue to diverge, with developed markets growing at a slower rate than pharmerging markets. I will now share highlights of Sun Pharma's business for the financial year 2023. I'm happy to report that we had a good year with strong performance across multiple parameters. All geographies did well recording double-digit growth, while profitability improved despite rising costs. Our global consolidated revenue grew by 12.6% to INR 433 billion. EBITDA grew by 12% to INR 116 billion, with margin of 26.5%. Adjusted net profit was up by about 12.8% to INR 86 billion. Excluding exceptional items, return on capital employed was maintained at 16.5%, while return on equity improved by about 1% to 15.9%. Our global specialty revenues recorded a strong 29% growth to reach USD 871 million. Its contribution has more than doubled from 7% of consolidated revenue in '18 to about 16.2% in FY '23. Sun Pharma's India business sales were at INR 136 billion, up by 6.6%, and accounted for about 32% of overall revenue. Excluding contribution of COVID-19 products in previous year, the underlying business performed well, with about 10.2% growth year-on-year. Our India business growth was in line with the industry growth, driven by leading presence in chronic segments and strong brand equity with doctors. As per AIOCD-AWACS March '23 data, our market share remained constant at 8.3% on net basis versus the previous year. Given the distribution and doctor reach of Sun's India business, we continue to be the partner of choice for global pharma companies for in-licensing of innovative products that can be potentially launched in India. We undertook India field force expansion in FY '23, adding 10% to our existing strength. The field force expansion has helped us declutter our portfolio and expand our presence in Tier 2 and Tier 3 terms. Sun Pharma is the largest pharmaceutical company in India and is ranked #1 in terms of prescription, with 12 different classes of specialties. Sun Pharma's leading position in India and its brand equity will help to leverage the benefits from the growth in the Indian pharmaceutical market. The Indian pharmaceutical market size is estimated to reach about INR 35 billion to INR 39 billion by '27 recording a 7.5% to 10.5% compounded growth. Demographics and lifestyle changes, rising per capita income, growing incidence of chronic ailment, increasing access to modern medicine and improving health insurance coverage will be the key driver of this growth. Revenues in the U.S. grew by 19% to INR 135 billion and accounted for approximately 31% of our consolidated revenue for FY '23. Growth was driven by specialty sales in the U.S., which continued to gain traction. Generics business in the U.S. continued to face price erosion, and there was additional impact of import alert at our Halol facility, imposed on December '22. However, we were able to partly compensate for these headwinds in the U.S. generics through new launches and market share gains. U.S. is the largest pharmaceutical market globally and expected to grow at about 2.5% to 5.5% CAGR to USD 762 million by 2027, with the growth driven mainly by innovative specialty products. Sun Pharma has presence in both the generics and in innovative segments in the U.S. and is well positioned to exploit growth opportunity in the U.S. market. Grew by 17% versus previous year in Emerging Markets, growth was recorded across multiple markets in local currency terms. Sun Pharma operates [indiscernible] Emerging Markets and is one of the largest Indian companies operating in these markets. The overall pharmaceutical spending in Emerging Markets, including India, is estimated to grow at 5% to 8% CAGR to USD 487 million to USD 518 billion by 2027. The Rest of the World business grew by around 11% for the year. We spent approximately 24 billion on R&D, which accounted for about 5.5% of sales. We continue to invest in building an R&D pipeline for both the global generics and the specialty business. Let me now update you on our specialty business. Over the past decade, Sun Pharma has invested towards building global specialty business as a new revenue stream for the company. While specialty is a part of global pharmaceuticals, it has different dynamics as compared to our existing business. Sun Pharma has marketed approximately 26 specialty products across markets. And I'm happy to report that global specialty accounted for 16.2% of our global consolidated revenue in '23. Our therapy areas of focus within the global specialty include skin care, eye care and skin cancers. Some of our key products are as follows: ILUMYA, which is used in treatment of adults with moderate to severe plaque psoriasis who are candidates for systemic therapy or phototherapy. As per World Psoriasis day consortium, psoriasis affects 2% to 3% of world's population, thereby making it a widely prevalent condition. [ ILYMYA ] belongs to the most advanced category of treatments available for treating psoriasis, namely IL-23 inhibitors. It's marketed by Sun Pharma directly in several markets, including the U.S., Canada, Australia, Japan. This is the largest product by revenue in our global specialty portfolio. Winlevi is a first-in-class topical androgen receptor inhibitor approved by U.S. FDA for the topical treatment of acne vulgaris in patients above the age of 12. Based on global burden of disease data, acne affects 9.4% of world's population. One treatment for acne, Winlevi, is the first FDA-approved acne drug in nearly 40 years with the first in class mechanism of action. Our product, CEQUA, is indicated to increase tear production in patients with dry eyes and inflammatory disease that affects more than 16 million people in U.S. alone. We have launched CEQUA in India recently to expand our commercial footprint and bring global specialty portfolio to the home market. Following are the highlights of our global specialty business for FY '23. During the year, Sun acquired Concert Pharma, the lead asset of Concert, deuruxolitinib, has successfully completed global Phase III trial, including in the U.S. for the indication of treatment of alopecia areata. The company launched SEZABY, phenobarbital sodium injection, in the U.S. market, which is indicated for the treatment of neonatal seizures. SEZABY is the first and only approved product in the U.S. with Orphan Drug administration for the treatment of neonatal seizures in term and preterm infants. Besides deuruxolitinib, which has completed Phase III study as discussed above, Sun Pharma specialty R&D pipeline comprises of following products. Our marketed product, ILUMYA is also undergoing Phase III clinical trial for psoriatic arteritis. Another candidate, MM-II, has completed global Phase IIb trial as a potential treatment for knee pain in patients with symptomatic knee osteoarthritis. SCD-044 is in Phase II clinical trial as a potential oral treatment for atopic dermatitis and moderate to severe plaque psoriasis. Finally, our glucagon-like peptide-1 receptor agonist, GL0034, has completed Phase I clinical trials. Early clinical data demonstrates marked weight loss and good tolerability. We presented this promising Phase I data in the ADA conference in San Diego, U.S. held in June '23 to start enrolling patients in Phase II trial during 2023. We continue to focus on improving manufacturing efficiencies and optimizing cost. At year-end, Sun Pharma had a strong net cash position of about USD 1.5 billion. Let me now share overall outlook of your company. All our businesses are well positioned, and we expect high single-digit consolidated top line growth for FY '24. The expansion for global specialty business is expected to continue. Our R&D spending is expected to be about 7% to 8% of sales in FY '24, with an increasing share of spending in specialty R&D. After providing insight into the company's business, I would like now to share the information on shareholder initiative taken by us. During this year, company worked extra mile in reaching out to long-term shareholders whose details were not updated with us and who have not been claiming their dividend for a long time. As an outcome of the company's proactive approach, unclaimed dividends for more than 7,000 shareholders were processed by the company voluntarily in a onetime exercise. We will continue to take various measures in the best interest of shareholders. Sun Pharma's dedicated workforce has been instrumental in attaining our organizational goals. We have faced several challenges in recent years, including pandemic-induced disruptions and an information security incident in March '23. Our employees have ensured that operations remained on track during those disruption threats. We are grateful to our Board of Directors for their continued guidance and support. Your support to us as shareholders is of vital importance, and we hope that you will continue to repose your confidence in us in the future. Thank you.

Thank you, Dilip. May I now request the company's Secretary and Compliance Officer, to speak on certain statutory aspects.

Thank you, Dilip. May I now request the Company Secretary and Compliance Officer to speak on certain statutory aspects?

Copy of the annual report for the year '22/'23, along with the Notice convening this 31st Annual General Meeting has been e-mailed to the members of the company. These documents are also made available on the company's website. As such, the Notice of 31st Annual General Meeting is being taken as read. The statutory auditor's report on the stand-alone financial segments for the financial year 2023 does not contain any qualifications or modify opinion or adverse remarks. Hence, it is being taken as read. The secretarial auditor's report for the financial year '22/'23 does not contain any qualifications or modified opinion or adverse remarks, except the comment in which, in the opinion of the Board, it's self-explanatory. Now I shall read out the relevant para of the secretarial audit report. We report that the [ UDN ] and the date of issue of certificate annexed in the annual report for FY '21/'22 issued under Regulation 34, read with Schedule V, Para-C, clause 10, sub-clause (i) of SEBI LODR regulations was incorrectly mentioned. It is clarified that there is no change in the contents of such certificate and such certificate was issued without any qualifications. Over to you, Goenka.

Thank you, Anoop. I shall now read out the resolutions for the items set out as ordinary business in the Notice of this Annual General Meeting. Item #1, adoption of stand-alone financial statements: resolved that the audited stand-alone financial statements of the company for the financial year ended March 31, 2023, and the reports of the Board of Directors and auditors thereon be and are hereby received, considered and adopted. Item #2, adoption of consolidated financial statements: resolved that the audited consolidated financial statements of the company for the financial year ended March 31, 2023, and the report of the auditors thereon be and are hereby received, considered and adopted. I now move to item #3, declaration of dividend: resolved that pursuant to the recommendation of the Board of Directors at their meeting held on May 26, 2023, the final dividend of INR 4 per equity share of INR 1 each on INR 239 crores, 93 lakh, 34,970 equity shares of INR 1 each amounting to INR 959 crores, 73 lakh, 39,880, for the financial year ended March 31, 2023, be and is hereby declared and that the same be paid to the equity shareholders whose names stood in the register of members as beneficial owners as the close of business hours on July 28, 2023, as per the list provided by NSDL and CDSL in respect of shares held in electronic form and as members in the register of members of the company. I shall now move to item #4 relating to reappointment of Mr. Sudhir Valia, who retires by rotation. Resolved that Mr. Sudhir Valia, having director identification #00005561, who retires by rotation under Section 152 of the Companies Act 2013 and being eligible, has offered himself for reappointment, be and is hereby reappointed as Director of the company, who shall be liable to retire by rotation. I shall now proceed to the items of special business. Since the resolutions for these items, along with explanatory statements outlining these objectives and implications are already provided in the Notice of 31st AGM they are not being read out. Item #5, ordinary resolution for ratification of remuneration of cost auditors; Item #6, special resolution for appointment of Mr. Rolf Hoffmann as an independent Director of the company for a period of 5 years; Item #7, special resolution for appointment of Aalok Shanghvi as a Whole Time Director of the company and approval of the renumeration payable to him for a period of 5 years; Item #8, ordinary resolution for material related party transactions between Taro Pharmaceuticals USA Inc. and Taro Pharmaceuticals Inc, Canada for financial year '23/'24. Now we will take up questions from shareholders. We will respond to all the queries at the end after all shareholders have had their turn. Those shareholders who are registered as speakers for this AGM will be permitted to express their views or ask questions for a maximum of 3 minutes each. [Operator Instructions] We shall now call out the names of shareholders one by one.

[Operator Instructions] The first speaker shareholder is [ Mr. Sateish Jeltilal Shah ]. Okay, the first speaker shareholder has not joined this meeting. The second speaker is [ Mr. Gorov Vilader Rozatka ]. The second speaker has also not joined this meeting. The third speaker shareholder is [ Ms. Snitab Haretsha ].

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Thank you.

That was our fourth speaker, [ Mr. Bhagat Shah ]. We go to our fifth speaker [ Manas Banerjee ].

Good afternoon, everybody, respective Chairman, present Board members and my fellow offline shareholders. Myself, [ Manos Banerjee ], joining the DC AGM from Kolkata. I convey my sincere thanks to our Company Secretary, Mr. Anoop Deshpande, and his full team for registering my name as a speaker and for AGM link. In all [indiscernible] financial year 2022/'23 was a good year. Our company delivered robust double-digit growth in revenue and profitability and further strengthening our market leadership. Congratulations to the Board members for this. Now I have some observations. Number one, sir, on Mohali plant, when we will be able to restart the supply from that plant? Next query, sir, on Revlimid. Sir, do you think it is a nice lucrative opportunity? Or is it a lot diluted? Next sir, could you just provide some color on why we have seen an increase in debt in the balance sheet? And finally, how should you see Taro's performance for the financial year 2023? If you give some light in this matter. I already supported all the resolutions by remote e-voting. Thank you for patience hearing and have a nice day. Over to you, sir, for next proceedings.

Thank you. Our next speaker #6 is Mr. [ Badri Vishal Bajaj ]. We'll move to our next speaker. We may come back to [ Mr. Badri ] if he is available. Speaker #7 is [ Mr. Manoj Kumar Gupta ].

Good afternoon. My name is [ Manoj Gupta ]. I've joined this meeting from my residence, Kolkata. I have a great respect and regard for Mr. Dilip Shanghvi, and I wish to God to give you more success and to take the company on new heights under his leadership. Sir, what's your future plan? And thanks to the company secretary and his team to help us to join this meeting through VC. And thanks for your CSR work. And sir, how much -- when the Taro merger will be complete? Today in the media that you are going to move on with the Taro. So what's your plan in that regard? And sir, generics, where government is focusing to inspire the generic medicines. So what's your view in this regard? And I strongly support all the resolutions to hope that company will touch the new heights under your leadership in future.

Thank you. Our speaker #8 and 9 are [ Mr. Vijay Memani and Mumpta Memani ]. They both have not joined the meeting. We go to our next speaker, speaker #10, [ Mr. Santoshi Kumar Saraf ].

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Thank you, [ Santoshi ]. Speaker #11 is [ Alpanar Salkar ]. Alpanar has not joined the meeting. Speaker #12, Mr. [ Bimal Kumar Agarwal ].

Good afternoon to everyone. First of all, I thank the Company Secretary, esteemed management staff and the shareholder. Chairman already answered my question. I won't take your time much. And I have already supported all the resolutions. What is the land bank we got as of now? Any new plant, we are putting up? I heard that. Only I want to know that's all from. And always keep the meeting VC, so from anywhere you can join. The director also don't have to come from their support there for business, they don't have to come. It may save quite a lot of money and you always keep this VC meeting because now [ Sun Pharma share, ] also said they keep it VC only. That's all from me. Thank you very much. Again, I thank the Company Secretary and his team. Thank you very much.

Thank you. Our next speaker #13 is [ Mr. Gautam Nandi ].

Good afternoon, respected Chairman, Board of Directors, and my online fellow shareholders. Myself, [ Gautam Nandi ] of Kolkata. Very old equity shareholder of your company. Sir, firstly, I'd like to give thanks to your secretarial department for sending me annual report along with Notice and necessary joining link through e-mail all in advance. So special thanks to our respected Company Secretary, Mr. Anoop Deshpande and his whole team of your secretarial department for [indiscernible] full services to all minority shareholders. Sir, you are organizing your Annual General Meeting through video conference, and I find it's a grand success. Sir, I am very pleased to receive your wonderful annual report, which is very attractive and also very, very informative. [Foreign Language] Sir, I find very good performance in every segment, even in this challenging year. Now the situation is still very tough. Every company is suffering so much. Still, you are paying very good dividend to our minority shareholders. Sir, I'm very happy, sir. Sir, your CSR is also very, very good. So please keep it, sir. Sir, I'd like to know what is the road map for the next 3 to 4 years? Sir, are you going to launch any new products in this year? Sir, do you have any expansion program in near future? Sir, one request, if situation permits, please arrange a factory visit in the coming winter season, at least for our speaker shareholders. We are eagerly awaiting for the visit, sir. Also, [Foreign Language] speaker shareholder [Foreign Language] please [indiscernible] accordingly including 2 [indiscernible] tickets, so please consider, sir. Another thing, sir, please provide speaker serial number with your link, which you are sending to us in advance. This is very urgent for us, sir. Sir, I have requested for the hard copy of annual report. You have already sent to my registered address, so thank you again sir. Sir, please do something on our [ add list ] for our speaker shareholders. This is nothing but it token of love. So please consider, sir. Sir, I'm very proud to be a shareholder of your company. I have full trust with our strong management set. And I shall -- along with my family, have already casted a vote in favor of you through my EOD. Sir, looking forward with a positive outlook towards our company with higher profit margin, handsome dividend, one is to one bonus and retail. Sir, may god bless you, sir. Stay safe, stay healthy. Thank you very much, sir. Gautam Nandi from Kolkata signing off, sir. Thank you.

Thank you. Our next speaker, #14 is [ Mr. Kaushik Sowkar ].

Good afternoon to everyone. First, I am honored to have the opportunity to address you all today. I would like to express my gratitude to the Board of Directors for allowing me this chance to express my view. First off, I salute the Board of Directors for continuing, VC [indiscernible] meeting, thereby allowing pan-India participation. Sir, I request you to continue this trend. I am satisfied shareholder of our company, and I must commend the management for the remarkable efforts in creating wealth of the shareholders, more particularly for minority shareholders. However, I'd like to raise a couple of concerns. My primary concern pertains to the utilization of [ saving ] on account of [indiscernible]. I believe it will look prudent and try to look at a portion of the savings of the shareholders' fund, more particularly amongst bigger shareholders who actually participate in [indiscernible] considering the valuable contribution and active environment, however, it could be [indiscernible] appreciation to restore a small momentum on the occasional festivals. So you can provide with the breakup of expenses on account of our physical meeting and on account of VC mode of meeting if possible. I really plead the Board to consider my proposal and explore the possibility of implementing the gesture. By doing so, [indiscernible] it will reinforce the [ past rapport ] between the company and its shareholders and contribute to overall well-being of the corporate family. My next concern, how has the Sun Pharma product portfolio evolved over the past years? Are there notable new product launches or development in the pipeline? What is the company approach to the product innovation and development, especially in terms of addressing unmet medical needs? Does company manufacture end drugs or on [ scale rashes ] and also for urinary infection, if any? I would appreciate it if you can send the name via email or a call. My final concern is the company has been hesitant in supporting individual MA, including myself. I have sent my [ emigration ] pass and follow-up specifically where the company has not heard my request. So not aiding a definitely able person be a part of sales activity, [indiscernible] supported certification work including [indiscernible] CV. Your system would mean a lot to me. If I can't get help from such a [indiscernible] like Sun Pharma, then who can I turn to? I am reserving my [ creation ] after meeting in the hopes of receiving [indiscernible] and productive consideration for retired help and support. I want to clarify that I'm not seeking handouts or free money nor any sympathy. I value my independence and self-reliance, I'm Chartered Accountant myself. And I hope you can understand and respect my [ retire ] who maintains their independence. Thank you for considering my requests and [indiscernible] support, I can make significant contribution to our organization and help also impact our society. I eagerly await your response and sincerely appreciate the time attention you have provided [ me already ]. Additionally, I would like to request assistance in addressing [indiscernible]. As a fellow [indiscernible], I have reviewed the [indiscernible] and guidance would be instrumental in [indiscernible] Board. Finally, I request -- I call on the other shareholders for site visit [indiscernible]. Thank you. Thank you so much.

Thank you. We have our next speaker, #15. [ Keev Phisa ]. [ Keev Phisha ] has not joined the meeting. We move to our next speaker, #16, [ Jedeet Buckshi ] Jedeet has also not joined. Our next speaker, #17 is [ Sureka Sharot Kumaysha ].

Hello, my name is [ Sureka Kumaysha ]. I'm a joint holder along with [ Sumit Tatar ]. I have already changed my point by e-mail and it is good afternoon, sir. And especially, sir, what I'm looking is that I have seen mail on Saturday evening and today morning, I have seen a reply from our Company Secretary. So I'm very happy because he replied to whatever I need, promptly, acknowledgment and [indiscernible] approach. So I'm very happy. Another thing, sir, there is -- everybody was talking. Dilip Shanghvi, he also talked about shareholders' worries. And what I want to tell you here is that, sir, I have [ demated ] some shares of Sun Pharma, which in 2018 and '19, which I should find out. Now again, once again, I started [indiscernible] some months 2023 and I sold 1 more share of Sun Pharma. So I requested to [indiscernible] performance to our Secretary on Saturday and he has [indiscernible] on the document and I'm ready with these all documents, sir. Another thing, sir, you talked about…

Can you speak a little bit closer to the mic? We cannot really understand what you're saying.

Okay, sir. And sir, I had one more point, like we see -- you talked about a lot of medicines, which cure whatever diseases we are happening. But whether we make any medicine that -- whether we have got any medicine, which cannot -- which stops having any diseases because recently, what I have done, I have done 1 blood test, which is normally done after bypass. And a lot of doctors have got different opinion and it's been normal. So my opinion that is something we can prevent, preventive is better than doing something at later date. That is my opinion, sir. And another thing, sir, I have sent you an e-mail and what I have noticed, is see, you are the largest pharmaceutical company and because a few all Indians and all over the world, people get very ill, sir, what is my -- what I have found in our 44,570 [ growth ] is much, much higher than [indiscernible] Pfizer [ EPC ]. And another thing what I have found, our stand-alone also is much higher than [ Hipla ]. And also our USA revenue of 13,535 crores is much higher than revenue from [ Altan Jelichemical Pfizer's EPC ]. So it looks like that you are the largest pharmaceutical company and I'm really very happy with this. Sir, another thing because of this, we have done a good business, the foreign exchange, what we gain, is 4,413 crores. And another thing is that our PAT is 8,473 crores. Previous year, it was 3,247 crores. This has been done at higher than the employment costs, the this year employment cost is INR 8,296 crores, slightly lower than the PAT. So it is really -- what -- in my opinion, always PAT should be higher than the employment costs. We run company for shareholders and then we run company for employees and because the previous year, the employment cost was more than double that of the PAT. And another thing, what I had gone through your consolidated profit and loss account and what I found…

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I have got only 1 point, sir. What I have found, sir, is the -- why our PAT is higher. PAT is higher because sales in the inventory which has helped us by [indiscernible] growth. Exceptional items increased by 4,405 crores and deferred tax has increased [indiscernible by 1,021 crores. And what I think, sir, if same situation remains, then definitely '23/'24 will be -- I think we are seeing good profits. Only thing my observation is that our earnings per share has increased from 13.6 to 35.6, but I don't find in this financial year, any increase in the share price. Why a market doesn't respond to our good PAT, that I have not understood. Is it possible please, try to explain this and whatever point, and I'm really happy with your Company Secretary because he responded to me very fast. Thank very much for giving the opportunity.

Our next speaker is Mr. [ Ashit Kumar Pata ].

I have, sir, a brief point. Sir, your opening remarks is very optimistic and for the prospective top line [indiscernible] and your stand-alone revenue is nicely achieved. EP has gone to plus 7 from minus 4. And sir, I have some brief views that at present our company's Halol facility status and also Mohali facilities, has issued some U.S. FDA noncompliance letter and also raw material had impression, higher borrowing cost and geopolitical turbulence had any adverse impact. And also an intense pricing pressure in the U.S. market and also my company encountered FDA-related issues, such as warning letter, quality control and manufacturing deficiencies, and product recalls in the U.S. So some highlights how you have come out from this. And optimistic demand for skill, your ports supply chain disruption and pharmaceuticals [ spot ] and clinical trials playing catch-up and data breaches and cyber security trades. How we are coming out all these negative parameters? Nothing to say more, I pray to god for your good health and prosperity of my company.

Speaker #19 is [ Hari Ram Chaudry ].

So I'm starting my speech, Mr. Chairman. My name is [ Hari Ram Chaudry ]. I am speaking from my home at [indiscernible], Bombay. Mr. Chairman, first of all, I guess that we have [ hybridation ] from next year also vehicle as well as online because in any season, we can attend all the meeting. Number two, there's a hybrid system in [ high court ], there's a hybrid system in my company were I'm a Director; and Mr. Chairman, in this vehicle, also attend where you out of Mumbai like take my case. I'm in Bombay. [indiscernible] in Bombay. My question today, because you've [indiscernible] easier system, please [indiscernible] from next year also. [indiscernible]

Sir, [ Hari Ram ], your voice is breaking…

[indiscernible] out of Bombay, [indiscernible] annual report prepared by your Company Secretary, I compliment you. About [indiscernible], can you let us know how do we stand to [ pay ] that this year and whether [indiscernible]? Mr. Chairman, from the CSR that we do, can you [indiscernible] members of that [indiscernible]? [indiscernible], I compliment you and our [indiscernible] I compliment the Company Secretary and now I [indiscernible]. Finally, let us know is that we have to be [indiscernible] whether we are in the [indiscernible]. Now, if possible [indiscernible] this year and also the last year? [indiscernible] amount you contributed by [indiscernible]…

[ Mr. Hari Ram ], you are breaking up. We are not able to fully understand your question. Can you switch off your radio?

I come through. Please, I come through. Thank you. I [indiscernible]. Thank you. I'll come through again. Thank you.

Thank you, [ Mr. Hari Ram ]. Speaker #20 is [ Aspeeva Mancho, Vasenia ]. [ Aspeeva ] has not joined. We go to our speaker #21, [ Vasudha Vikas Takwei ].

Good evening, respected Chairman. Respected Chairman, sir, Board of Directors and fellow shareholders, myself, [ Vasudha from Tani ]. I would like to congrats our Company Secretary for sending the soft copy of the report read in advance, which its subject's clear and transparent. The opening phrase given by the Chairperson is also very excellent and informative. I would like to ask what is our attrition rate? Secondly, I would like to ask which plant gives us highest revenue out of our 18 plants? With this, I support all the resolutions. Thank you very much, and wish the company all the best for coming financial years, and my best wishes for all the festivals coming during the month of Shravan in Hyderabad. Thank you very much, sir.

Thank you. Our next speaker #22 is [ Mr. Yusef Ranwaller ]. There seems to be some technical issue from [ Mr. Ranwaller's ] side. We move to our next speaker #23, [ Mr. Denish Patia ].

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Thank you. [ Mr. Yusef ] has joined.

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Our next and the last speaker, #24 is [ Mr. Ramesh Shankar Gola ]. Mr. Ramesh has not joined the meeting. With this, we complete our list of speakers.

Yes. May I now request Mr. Dilip Shanghvi to respond to all your queries?

Yes. Thank you. So I wish to broadly thank all the shareholders for your appreciation of the efforts of the secretarial department and also the effort of the employees and the directors to run the business in the best possible way. And I appreciate the encouragement and we will continue to make the effort so that we can continue to produce same kind or even better results going forward. There were a few specific questions related to new products that we have recently launched and what kind of market share that we've been able to get. To that, I think, generally, whenever we launch a product, we try and ensure that we are amongst the, if not the largest, at least among the top 3 players in every product that we are in market. We are able to achieve this in most of the new launches. Specific product-by-product I think if you have interest, we will be able to share the information with you. But I think the Secretary of Department can share those information with you. There is generally a suggestion for continuing the video meeting or even a hybrid meeting where people [indiscernible]. I think that we will definitely consider as an important suggestion. There were questions related to business impact of the Mohali and Halol facility. I think we have -- we are continuing to sell products out of the exempted product from Halol. And for Mohali, I think we had shared the update about the current status in our last quarterly call. There are no specific additional information beyond that. However, we continue to supply from Mohali to many other countries where we are supplying products. There was also a question related to Revlimid, whether -- how big a product it is. So it's an important product, and we expect it to continue to be an important product, at least for the next 1, 1.5 years. The -- There were questions about increase in the debt in the books. All of you are aware that we acquired Concert Pharmaceuticals for, I think, close to $570 million. For that, we have taken some temporary bridge finance because money that we had was invested in assets that we could not liquidate immediately. But I think if you will see our quarterly statement, then there is a significant reduction in that debt. Going forward, we will possibly be -- end of this year, we should be repaying all the debt by either current cash flows or from the cash that we are holding. There's also a question about the future plan. I think as a part of my readout, I shared with you the overall guidance about the growth of the company and the focus of the company, would be to grow all the businesses and continue to grow the profitability as well as the top line. There were questions related to Taro merger. So as you are aware, I think we've made an offer to Taro to buy out the minority shareholders and buy out the rest of the shares which we don't own. We've also shared with the investors that we -- Taro will respond to our proposal. And as we have any additional information to share with the shareholders about the Taro transaction, we will share that with you. But there is no specific additional update related to -- There's some concern about the price competition on the generic medicine. It is a competitive business, and we need to continue to make up for the lost top line and bottom line by new businesses or by improving the market share of the existing product. I think that's something that we've been able to do in our generic business in the U.S., to some extent, in Europe also is continuing to grow. There's something about insider trading that I did not fully understand. But if you wish to, I think we can share specific information whenever we -- the secretarial department will share more information with you. There's suggestions about female empowerment, and I think we also have an ongoing focus on increasing the number of female employees and also creating an environment where female employees continue to do well in the company. I think it's a company of choice for female [indiscernible] long-term carrier. Quite a few of our senior executives are already female, but the opportunity is there for us to increase that number. I think overall, our progress in ESG, which will also have this as an information, is in our ESG report, which may be part of our, what you call -- is there on our website.

The Sustainability -- the BRSR.

The sustainability report, you should be able to see everything, including the focus on increasing use of renewable energy, recycling, improving, reducing the power consumption and various initiatives so that we can reduce the carbon footprint of our business. Generally, I think our approach for identifying a new product is a product which can help patient or doctors treat a disease better than the current products are and that is one of the key reason why we are successful as a company. I think there are some suggestions about employee costs. I think while our focus is on reducing the overall employee costs, not only by controlling costs, but also by growing the top line, but you should also recognize that we continue to acquire new businesses and some of the new businesses are in early phases of their development, so the proportionate amount of employee cost of these products are much higher than us. So they increase the overall employee costs. But when these products will come to market, they will again help us in reducing the overall employee cost as the -- as we continue to leverage the new acquisitions and grow the top line. The general concern about the pricing pressure in the generic business, increasing cost and some additional information related to product recall, which also, I think, is too detailed for me to share with you on this call, but the secretarial department should be able to give additional information. I think cybersecurity was an important learning experience for us. And I think it has helped us strengthen our security processes. And what we are happy is that with the support and the involvement of teams across the country and with -- from different functions, we could continue the normal business of the company and we could achieve the business objective without getting negatively impacted because of the cybersecurity incidence. Overall, I think the company has made significant investment as well as a lot of efforts in CSR activity. Our CSR activity is focused around health and education. We issued multiple recognitions as well as awards because of the -- what you call the [ varying rate videos ] that we have. So I think there's a question related to attrition rate. My recollection is that our overall attrition rate would be less than 10%, but it may be 1% here or there. But amongst the industry, I think we have the lowest attrition rate in the pharma industry in India. And as per the best place to work, I think we've been recognized as the best place to work in terms of employee morale as well as the support in the health care industry. I think I must appreciate the recognition. And also, we are happy that we are able to give a work environment where people can continue to create and can contribute and get recognition for their efforts. Then amongst the various plant, I think there is a suggestion about -- I'm then asked question about which is the facility with the largest top line revenue. So I think we have 2 plants in Sikkim. One of these plant, Sikkim 2, has the largest revenue from a single plant in the whole company. Then there is -- I mean, the question related to -- we've made significant investment in the U.S. 'til now. I don't have a specific number, but we believe that a large part of the investment has been from the income that we've generated from the U.S. and we continue to generate future growth and revenue out of the U.S. The details about the plants in India and outside of India, I think we have large number of facilities, so difficult to give details. But if you want specific information, then the secretarial department will be happy to share more detailed information with you. There were multiple requests for plant visits. I think like what I have explained to you in the past, pharmaceutical industry have a controlled manufacturing environment and it's very difficult without violating GMP [indiscernible] have unauthorized personnel visit the facility. So I hope you understand the challenges that we face and it will be difficult to accept that as request. I think there were also requests about speaker shareholders. I don't know whether from a law point of view, we can create shareholders differentially or permits as to treat shareholders differentially. There was a specific question about the company policy related to differentially abled employ -- I mean people. We don't have yet a policy. We need to discuss this in our interim [indiscernible] policy that we can sustain and deliver it. I think I have tried to make an effort to respond to all the questions that were raised. Mr. Goenka, have I missed anything?

No, I think you have covered it. Yes. So thank you, Dilip. Dear shareholders, we have answered the questions and queries put up before the meeting. If inadvertently we have missed to respond to any question, we shall address them separately. The e-voting will remain open until 15 minutes from the conclusion of this meeting. Those shareholders who have not cast their votes yet are requested to do so. I request the scrutinizer to complete the scrutinizing process and then submit the report to myself or the Company Secretary and Compliance Officer, being the person authorized by me. The scrutinizer's report and the e-voting results will be submitted to stock exchange within the prescribed time and it will also be placed before -- placed on the company's and CDSL's website. Also, the results will be displayed on Notice Board of the company at its designated office and corporate office. I thank one and all for attending this meeting. We can now conclude the 31st Annual General Meeting of the company. Thank you.

Thank you.

Thank you. And with permission of the Chair, I declare this meeting has concluded. Thank you, everyone.