The Directors are pleased to present the THIRTY FOURTH ANNUAL REPORT
and the audited statements of accounts for the year ended 31st March
Financial Results (Standalone)
(Rs. in million)
For the year ended March 31,2015 March 31,2014
Income from operations 45,928 38,616
Profit before Exceptional Items 4,820 4,201
Provision for Taxation 1,207 894
Net Profit before Exceptional Item 3,613 3,307
Exceptional Item (147) -
Net Profit after Exceptional Item 3,466 3,307
Balance of Profit brought forward 3,165 2,307
Profit Available for appropriations 6,631 5,614
Dividend (inclusive of dividend tax) 964 936
Transfer to General Reserve 1,500 1,500
Transfer to Debenture Redemption Reserve 485 13
Amount charged off in accordance with 539 -
transitional provisions of the Companies
Balance carried forward to Balance sheet 3,143 3,165
Results of Operations
During the year under review, the income from operations of the Company
increased to Rs. 45,928 million compared to Rs. 38,616 million in the
previous year, registering an impressive growth of 19%. The profit
after tax for the year increased by 5% to Rs. 3,466 million compared
to Rs. 3,307 million in the previous year.
During the year under review, the consolidated gross revenue of the
Company increased to Rs. 51,785 million compared to Rs. 43,842
million in the previous year, registering an impressive growth of 18%.
Net profit after minority interest for the group increased to Rs.
3,399 million from Rs. 3,168 million representing a growth of 7%.
Consolidated Financial Statements
In accordance with the Companies Act, 2013 (the Act) and Accounting
Standard (AS)-21 on Consolidated Financial Statements read with AS-23
on Accounting for Investments in Associates and AS-27 on Financial
Reporting of Interests in Subsidiaries, Associates and Joint Ventures,
the audited consolidated financial statements form part of the Annual
In terms of provison to sub section (3) of Section 129 of the Act, the
salient features of the financial statements of the Subsidiaries,
Associates and Joint Venture Companies are set out in the prescribed
Form AOC-1 which forms a part of the Annual Report.
In accordance with Section 136 of the Act, the audited financial
statements, including the consolidated financial statements of the
Company and audited accounts of the subsidiaries are available on the
website www.apollohospitals.com. The documents will also be available
for inspection during business hours at the registered office of the
The Board of Directors have recommended a dividend of Rs. 5.75 per
equity share (115% on face value of Rs. 5/- per share) on the paid-up
equity share capital of the company for the financial year ended 31st
March 2015 amounting to Rs. 963.76 million inclusive of tax of Rs.
163.79 million, which if approved at the forthcoming Annual General
Meeting on 11th August 2015, will be paid to those shareholders whose
names appear in the Register of Members as at the closing hours of
business on 31st July 2015. In respect of shares held in electronic
form, the dividend will be paid on the basis of beneficial ownership
furnished by the depositories viz., NSDL and CDSL for this purpose.
The Register of Members and Share Transfer Books will remain closed
from Saturday, 1st August 2015 to 11th August 2015 (both days
Transfer of Reserves
Your Company proposes to transfer Rs. 1,500 million to the general
reserves out of the amount available for appropriations. An amount of
Rs. 3,143 million is proposed to be retained in the Profit & Loss
CRISIL has rated the company''s debt instruments as AA indicating a high
degree of safety.
Subsidiaries, Joint Ventures and Associate Companies
At the beginning of the year, your Company had ten direct subsidiaries,
six step down subsidiaries, seven joint ventures and three associate
companies. As on March 31, 2015, your Company has twelve direct
subsidiaries and five step down subsidiaries, seven joint ventures and
three associate companies.
The statement containing the summarised financial position of the
subsidiary companies viz., Apollo Home Healthcare (India) Limited
(formerly known as Unique Home Health Care Limited) (AHHCL), AB Medical
Centres Limited (ABMCL), Samudra Healthcare Enterprises Limited (SHEL),
Apollo Hospital (UK) Limited (AHUKL), Apollo Health and Lifestyle
Limited (AHLL), Western Hospitals Corporation Pvt Limited (WHCPL),
Total Health (TH), Apollo Nellore Hospital Limited (ANHL), Imperial
Hospital and Research Centre Limited (IHRCL), Alliance Medicorp (India)
Limited (Alliance), Sapien Bio Sciences Pvt Limited (SBPL), Apollo
Rajshree Hospitals Pvt Limited (ARHL), Apollo Bangalore Cradle Limited
(ABCL), Apollo Cosmetic Surgical Centre Pvt Limited (ACSPL), Apollo
Sugar Clinics Limited (ASCL), Akeso Healthcare Private Limited (AKESO)
and Nova Speciality Hospitals Limited (NOVA), pursuant to Section 129
and Rules 5 of the Companies (Accounts) Rules, 2014, is contained in
Form AOC - 1 which form part of the Annual Report.
Apollo Home Healthcare (India) Limited (AHHCL)
(Formerly known as Unique Home Health Care Limited)
AHHCL, a wholly owned subsidiary of the Company provides medical and
paramedical services including doctor''s consultation, physiotherapy
direct to patient homes and also offers paramedical services in
hospitals to critically ill patients. During the year AHHCL, recorded a
revenue of Rs. 31.18 million and a net profit of 4.28 million.
AB Medical Centres Limited (ABMCL)
ABMCL, a wholly owned subsidiary of the Company does not have any
commercial operations as it has leased out its infrastructure viz.,
land, building and medical equipment to the company for running a
hospital. For the year ended 31st March, 2015, ABMCL recorded an income
of Rs. 6.40 million and a net profit of Rs. 4.78 million.
Samudra Healthcare Enterprises Limited (SHEL)
SHEL, a wholly owned subsidiary of the Company, runs a 120 bed multi
speciality hospital at Kakinada. For the year ended 31st March, 2015,
SHEL recorded an income of Rs. 282.92 million and a net profit of 5.29
Apollo Hospital (UK) Limited (AHUKL)
AHUKL is a wholly owned foreign subsidiary of the Company and has not
yet commenced its operations. Apollo Health and Lifestyle Limited
AHLL, a wholly owned subsidiary of the Company is engaged in the
business of providing primary healthcare facilities through a network
of owned/franchised clinics across India offering specialist
consultations, diagnostics, preventive health checks, telemedicine
facilities and a 24-hour pharmacy all under one roof. For the year
ended 31st March, 2015, AHLL recorded an income of Rs. 1,664.35
million and a net loss of Rs. 271.61 million.
Western Hospitals Corporation Private Limited (WHCPL)
For the year ended 31st March 2015, WHCPL, a wholly owned subsidiary of
the Company, recorded a net profit of Rs. 8.93 million.
Total Health (TH)
Total Health, a wholly owned subsidiary of the Company registered under
Section 25 of the then Companies Act, 1956, is carrying out CSR
Apollo Nellore Hospital Limited (ANHL)
ANHL has leased out its land at Nellore to the Company. ANHL recorded
revenues of Rs. 7.42 million and a net loss of Rs. 7.78 million.
Imperial Hospital and Research Centre Limited (IHRCL)
IHRCL, a 90% subsidiary of the company owns a 240 bed multi-specialty
hospital at Bengaluru. For the year ended 31st March, 2015, IHRCL
recorded an income of Rs. 1,671.90 million and a net profit of Rs.
Alliance Medicorp India Limited (Alliance)
Apollo holds a 51% stake in Alliance, which is engaged in the business
of running dialysis clinics. For the year ended 31st March, 2015,
Alliance recorded an income of Rs. 43.13 million and a net loss of Rs.
Sapien Biosciences Pvt Ltd (SBPL)
SBPL, a 70% subsidiary of the company which is engaged in the business
of bio-banking of tissues is currently in the startup stage. For the
year ended 31st March, 2015, SBPL recorded a net loss of Rs. 13.26
Apollo Rajshree Hospitals Pvt Ltd (ARHL)
ARHL, a 57.66% subsidiary of the company, runs a multi speciality
hospital at Indore. For the year ended 31st March, 2015, ARHL recorded
an income of Rs. 139.98 million and a net loss of Rs. 96.44 million.
Apollo Bangalore Cradle Limited (ABCL)
ABCL, a subsidiary of Apollo Health and Lifestyle Limited, is engaged
in the business of healthcare service. For the year ended 31st March,
2015 ABCL recorded an income of Rs. 226.29 million and a net loss of
Rs. 34.90 million.
Apollo Sugar Clinics Limited (ASCL)
ASCL, a subsidiary of Apollo Health and Lifestyle Limited, is engaged
in the business of healthcare services. For the year ended 31st March,
2015, ASCL recorded an income of Rs. 44.44 million and a net loss of
Rs. 50.76 million.
Apollo Cosmetic Surgical Centre Pvt Ltd (ACSPL)
ACSPL, a subsidiary of Apollo Health and Lifestyle Limited, is engaged
in the business of running cosmetic surgical centres. For the year
ended 31st March, 2015, ACSPL recorded an income of Rs. 42.56 million
and a net loss of Rs. 1.67 million.
Akeso Healthcare Private Limited (AKESO)
AKESO, a wholly owned subsidiary of Apollo Health and Lifestyle
Limited, is engaged in the business of healthcare services. For the
period of 9 months ended 31st March, 2015 it recorded an income of Rs.
57.39 million and a net profit of Rs. 2.35 million.
Nova Speciality Hospitals Private Limited (NOVA)
NOVA, a wholly owned subsidiary of Apollo Health and Lifestyle Limited,
is engaged in the business of poly clinics, diagnostic centres and day
care surgery centres. For the year ended 31st March 2015, NOVA recorded
an income of Rs. 217.86 million and a net loss of Rs. 108.87 million
The Company is committed to maintain the highest standards of corporate
governance and adhere to the corporate governance requirements set out
by SEBI. The report on Corporate Governance as stipulated under the
Listing Agreement forms an integral part of this Report. The requisite
certificate from the Auditors of the Company confirming compliance with
the conditions of corporate governance is attached to the report on
Management''s Discussion and Analysis Report
Management''s Discussion and Analysis Report for the year under review,
as stipulated under Clause 49 of the Listing Agreement with the Stock
Exchanges in India, is presented in a separate section forming part of
the Annual Report.
The Company has zero tolerance for sexual harassment at the workplace
and has adopted a policy on prevention, prohibition and redressal of
sexual harassment at the workplace in line with the provisions of the
Sexual Harassment of Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013 and the rules framed thereunder. The company did
not receive any complaints to report in the Board''s report or intimate
to the District Officer.
Vigil Mechanism / Whistle Blower Policy
The Company has established a vigil mechanism for Directors and
Employees to report their genuine concerns, the details of which are
given in the Corporate Governance Report. The policy on Vigil Mechanism
and Whistle Blower Policy have been posted on the website of the
Particulars of Loans, Guarantees and Investments
Details of Loans, Guarantees and Investments covered under the
provisions of Section 186 of the Companies Act, 2013 are given in the
notes to the Financial Statements.
During the financial year, your Company had accepted fresh deposits of
Rs. 43.68 million. The total deposits with the Company as on 31st
March 2015 was Rs. 339.27 million (Rs. 354.51 million as on 31st
March 2014) which include deposits for an aggregate value of Rs. 1.49
million (Rs. 6.41 million as on 31st March 2014) not claimed by
Directors and other Key Managerial Personnel (KMPs)
Changes in the composition of the Board of Directors and KMPs
Shri. Vinayak Chatterjee was appointed as an additional director with
effect from 2nd July 2014 and the Members at the Annual General Meeting
held on 25th August 2014 approved his appointment as an Independent
Director to hold office for five (5) consecutive years for a term upto
31st March 2019, not liable to retire by rotation.
Shri. Khairil Anuar Abdullah has resigned from the office of Director
of the Company with effect from 21st January 2015 citing his inability
to continue given his other professional commitments.
The Board wishes to place on record its appreciation for his
contributions made during his tenure as a Director of the Company.
Board Composition and Independent Directors
The Board consists of the Executive Chairman, four Executive Directors
and eight Independent Directors. Independent directors are appointed
for a term of five years and are not liable to retire by rotation.
All Independent Directors have given declarations that they meet the
criteria of independence as laid down under Section 149(6) of the
Companies Act, 2013 and Clause 49 of the Listing Agreement.
Retirement by Rotation
Pursuant to Section 161(1) of the Companies Act, 2013 Smt.Preetha
Reddy, Director retires by rotation at the ensuing Annual General
Meeting and being eligible offers herself for re-appointment.
Re-appointment of Executive Directors
The tenure of offices of the Executive Directors viz., Smt.Preetha
Reddy as Executive Vice Chairperson, Smt. Suneeta Reddy as Managing
Director and Smt. Sangita Reddy as Joint Managing Director are due for
renewal on 3rd February 2016.
The Board recommends their appointments and accordingly resolutions
seeking approval of the members for their appointments have been
included in the Notice of the Annual General Meeting of the Company
along with their brief profiles.
Key Managerial Personnel
Pursuant to the provisions of Section 203 of the Companies Act, 2013
the appointments of Smt. Suneeta Reddy, Managing Director, Shri.
Krishnan Akhileswaran, Chief Financial Officer and Shri. S.M. Krishnan,
Company Secretary, were formalized as the Key Managerial Personnel of
Statutory Auditors and Secretarial Auditors Report
The Directors hereby confirm that there is no qualification,
reservation or adverse remark made by the statutory auditors of the
company or in the secretarial audit report by the practicing company
secretary for the year ended 31st March, 2015.
Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of
the Listing Agreement, the Board has carried out an annual performance
evaluation of its own performance, the directors individually as well
as the evaluation of the working of the Audit and Nomination &
Remuneration Committees. The manner in which the evaluation has been
carried out is stated in the Corporate Governance Report.
The Board has, on the recommendation of the Nomination & Remuneration
Committee approved a policy for selection and appointment of Directors,
Senior Management and for determining their remuneration. The
Remuneration Policy is stated in the Corporate Governance Report.
Meetings of the Board
The Board met seven times during the financial year, the details of
which are given in the Corporate Governance Report.
The intervening gap between the Meetings was within the period
prescribed under the Companies Act, 2013.
Pursuant to the requirement of Clause 49 of the Listing Agreement, the
Company has constituted a Business Risk Management Committee. The
details of the Committee and its terms of reference are set out in the
Corporate Governance Report.
The Company has a robust Business Risk Management framework to
identify, evaluate business risks and opportunities. This framework
seeks to create transparency, minimize adverse impact on the business
objectives and enhance the Company''s competitive advantage.
The business risk framework defines the risk management approach across
the enterprise at various levels including documentation and reporting.
The framework has different risk models which help in identifying risk
trends, exposure and potential impact analysis at a Company level as
also separately for individual business segments.
Internal Control Systems and their Adequacy
The Company has an Internal Control System, commensurate with the size,
scale and complexity of its operations. To maintain its objectivity
and independence, the Internal Audit function reports to the Chairman
of the Audit Committee of the Board. During the year, such controls
were tested and no reportable material weaknesses in the design or
operation were observed.
Significant and Material Orders passed by the Regulators or Courts.
There are no significant material orders passed by the Regulators /
Courts which would impact the going concern status of the Company and
its future operations.
Directors'' Responsibility Statement
Pursuant to Section 134(3)(c) of the Companies Act 2013, the Directors
of the Company hereby state and confirm:
a. that in the preparation of the annual financial statements for the
year ended March 31,2015, the applicable accounting standards have been
followed along with proper explanations relating to material
departures, if any;
b. t hat such accounting policies have been selected and applied
consistently and judgement and estimates have been made that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company as at March 31,2015 and of the profit of the
Company for the year ended on that date;
c. t hat proper and sufficient care has been taken for the maintenance
of adequate accounting records in accordance with the provisions of the
Companies Act, 2013 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
d. that the annual financial statements have been prepared on a going
e. that proper internal financial controls were in place and that the
financial controls were adequate and were operating effectively.
f. that systems to ensure compliance with the provisions of all
applicable laws were in place and were adequate and operating
The paid up Equity Share Capital as on March 31,2015 was Rs. 695.63
million. During the year under review, the Company has not issued
shares with differential voting rights nor granted stock options nor
sweat equity. As on March 31, 2015, the details of the shareholding by
the Directors of the Company are set out in the Corporate Governance
Report forming part of the Board''s Report and none of the directors
hold convertible instruments of the Company.
The Board at its meeting held on 28th May, 2015 approved the proposal
to undertake an issue of equity shares to the existing shareholders on
a Rights basis of a sum of upto Rs. 7,500 million. The purpose of the
Rights Issue would be to provide headroom for future debt funding
during a period of low interest rate regime as the Company continues on
its growth path, apart from rewarding its shareholders.
The Board has since constituted a Sub Committee to administer and
oversee all matters relating to the terms of the Rights Issue.
Contracts and Arrangements with Related Parties
All contracts / arrangements / transactions entered by the Company
during the financial year with related parties were in the ordinary
course of business and on an arm''s length basis. During the year, the
Company had not entered into any contract / arrangement / transaction
with related parties which could be considered material in accordance
with the policy of the Company on materiality of related party
The Policy on materiality of related party transactions and dealing
with related party transactions as approved by the Board may be
accessed on the Company''s website at the link:
http://www.apollohospitals.com . Your Directors draw attention of the
members to the Notes to the financial statement which sets out related
None of the Directors have any pecuniary relationships or transactions
vis-a-vis the Company.
Particulars of Employees and related disclosures
In terms of the provisions of Section 197(12) of the Companies Act,
2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, a statement showing
the names and other particulars of the employees drawing remuneration
in excess of the limits set out in the said rules is provided in the
Disclosures pertaining to remuneration and other details as required
under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of
the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014 are provided in the Annual Report.
Having regard to the provisions of Section 136(1) read with its
relevant provisio of the Companies Act, 2013, the Annual Report
excluding the aforesaid information is being sent to the members of the
Company. The said information is available for inspection at the
Registered Office of the Company during working hours and any member
interested in obtaining such information may write to the Company
Secretary and the same will be furnished free of cost.
Employee Stock Options
No Employee Stock Options have been given to the employees of the
company and thus no disclosure is required.
Corporate Social Responsibility Initiatives
As part of its initiatives under Corporate Social Responsibility
(CSR), the Company has undertaken projects in the areas of Rural
Development, Education and Health. These projects are in accordance
with Schedule VII of the Companies Act, 2013. The Report on CSR
activities for the financial year 2014-15 is annexed herewith as
The Statutory Auditors, M/s. S. Viswanathan, Chartered Accountants,
retire at the ensuing Annual General Meeting and have confirmed their
eligibility and willingness to accept office, if reappointed.
The Audit Committee and the Board recommend the re-appointment of
M/s.S.Viswanathan, Chartered Accountants, as Auditors of the Company,
to hold office till the conclusion of the next Annual General Meeting.
Pursuant to Section 148 of the Companies Act, 2013 read with The
Companies (Cost Records Activities and Audit) Amendment Rules, 2014,
your Directors had, on the recommendation of the Audit Committee,
appointed M/s. Raman & Associates, Cost Accountants, Chennai (ICWA
Registration No.000050) to audit the cost records of the Company for
the financial year 2015-16 on a remuneration of Rs. 1.50 million.
As required under the Companies Act, 2013, the remuneration payable to
the cost auditor is required to be placed before the Members in a
general meeting for their ratification. Accordingly, a resolution
seeking Members'' ratification for the remuneration payable to M/s.
Raman & Associates, Cost Accountants, Chennai (ICWA Registration
No.000050) is included at Item No. 8 of the Notice convening the Annual
The Board has appointed Smt. Lakshmmi Subramanian, Senior Partner, M/s.
Lakshmmi Subramanian & Associates, a firm of Company Secretaries in
practice, to conduct Secretarial Audit for the financial year 2014- 15.
The Secretarial Audit Report for the financial year ended March 31,2015
is annexed herewith as Annexure B to this Report. The Secretarial
Audit Report does not contain any qualification, reservation or adverse
Particulars regarding Conservation of Energy, Technology Absorption and
Foreign Exchange Earnings and Outgo
The information as required to be disclosed on conservation of energy,
technology absorption and foreign exchange earnings and outgo
stipulated under Section 134(3)(m) of the Companies Act, 2013 read with
Rule 8 of the Companies (Accounts) Rules, 2014, is annexed herewith as
Extract of Annual Return
The details forming part of the extract of the Annual Return in Form
MGT-9 is annexed herewith as Annexure D.
Your Directors wish to place on record their appreciation of the
contributions made by employees at all levels,towards the continued
growth and prosperity of your Company.
Your Directors also wish to place on record their appreciation of
business constituents, banks and other financial institutions and
shareholders, of the Company for their continued support.
For and on behalf of the Board of Directors
Place : Chennai Dr. Prathap C Reddy
Date : 28th May, 2015 Executive Chairman