Apollo Hospitals Annual Report 2013-2014 3k2y53

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Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Inside this book

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Performance Highlights 4 6 8 10

C o r p o r at e R e v i e w

42 43 44 53

Business Review Management Discussion and Analysis Clinical Governance

82 106

F i n a n c i a l S tat e m e n t s 108 114 159 161 223

At Apollo we are cognizant of what this means. The pursuit of excellence in all that we do and a Patient First approach to healing underpins our health care practice. We have for over 30 years now put smiles on over 35 million faces with this sustained dedication towards patient wellbeing. Our motivation is simple.

It lies in our understanding that the human body is

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Priceless.

As reported in The New York Times, 11th February, 1976, “The High Cost of Being Human”—Harold J Morowitz

Consolidated Financials

Apollo Hospitals’ Mission is “to bring healthcare of international standards within the reach of every individual. We are committed to the achievement and maintenance of excellence in education, research, and healthcare for the benefit of humanity.”

Standalone Financials

Auditors’ Report on Standalone Financial Statements Standalone Financial Statements Auditors’ Report on Consolidated Financial Statements Consolidated Financial Statements Statement pursuant to Section 212 of the Companies Act, 1956

Such valuations are obviously purely notional. The blueprint and the savoir faire to assemble the raw materials into a warm body magically materialize the moment conception takes place. They codify, particularise and define how that body will function and how it will look. The body’s innate intelligence unfolds and stays with it every day using the nervous system as its conduit to coordinate the massive number of functions that occur every second within it. If this capability together with the body’s parts-vital and reproductive organs, fluids, tissues, germ fighting capabilities, its DNA and its emotions are taken into consideration, there is really no justifiable price tag for the human body. It is quite simply non-pareil and quite simply Priceless.

Business Review

The Apollo Commitment 12 Responsible 14 Adaptable 22 Caring 26 Collaborative 28 Future Ready 32 Sustainable 36 Socially Conscious 40

The Board Corporate Information Directors Report to the Shareholders Corporate Governance Report

Statutory Section

The Apollo Ethos Evolution of Apollo The Year Gone By Financial Highlights

Over the years many scientists have attempted to value the human body. The tag, once upon a time a mere 98 cents, has risen steadily over the years from $3.50 in 1972 to $5.60 in 1976 and $650 soon after. Then came along Yale molecular biologist, Harold J Morowitz, who referenced a biochemical company’s catalogue that priced synthesized materials like haemoglobin at $2.95 a gram and bradykinin at $12,000 a gram, and came up with the staggering 6 million dollar man. He stated that the dollar number was merely a deduction based on the cost of materials available commercially-the hormones, proteins, enzymes, RNA, DNA, amino acids and other complex bio-chemicals that are the building blocks of life, and estimated that fashioning the $6 million chemical shopping list into human cells might cost closer to $6,000,000,000,000,000 (six thousand trillion dollars). Assembling the resulting heap of cells into tissue, the tissue into organs, and the organs into a warm body might in fact drain all the treasuries of the world, with no guarantee of success, Morowitz concluded.# 

S tat u t o r y S e c t i o n

Corporate Review

Chairman’s Message

As caregivers, we at Apollo take this responsibility very seriously while we continue to focus on providing best-in-class medical treatment across all specialties of care. Be it Cardiology, Oncology, Orthopedics, or Neuro-sciences, we provide the same emphasis on creating a culture of health and wellness as with care and sickness.

Chairman's Message

It is human nature to take for granted things that are gifted to us. It is only when a resource becomes neglected or is taken for granted, that it is missed and its absence regretted.

Non-Communicable Diseases (NCDs) represent a new frontier in the fight to improve global health. NCDs affect the developing world and the lower-income populations the hardest. NCDs are estimated to for nearly 75% of all global deaths. India alone s for 17% of these. This high burden poses a substantial threat to India’s socio economic development, with a potential cumulative loss of US $6.2 trillion by 2030 – nearly 3.5 times our current GDP!

The year saw us scaling our clinical value proposition with the introduction of several new initiatives across specialties. The first ever separation of the Pygopagus twins highlights our clinical focus and our commitment to patient care and excellence. The COE (Centres of Excellence) initiatives has further gained momentum and driven improvements in the case mix across our network. We have successfully conducted over 500 robotic surgeries in fiscal year 2014, further elevating our standards of technology excellence and quality of patient care, while continuing to remain the World No. 1 in solid organ transplants.

Global experience, has demonstrated that interventions aimed at prevention and early diagnosis are the most cost effective means for NCDs’ control, especially in developed markets. There is clear evidence linking reductions in cardiovascular and diabetes related morbidity and mortality to focus on initiatives such as large scale awareness campaigns, lifestyle interventions, screening programmes and medication for highrisk groups. It is critical to recognize that many risk factors of NCDs (unhealthy diet, physical inactivity, tobacco use, alcohol abuse) are controllable with right individual action. The challenge for India is to create a mindset where individuals see healthy living as an essential investment rather than as an expense.

I wish to conclude by stating that, by getting a health check done, you are taking care of the two most important and scarcest resources in your life, time and health. It is time well spent. Please this message on to everyone you touch. I wish you and your families all the very best of health and thank each and every stakeholder for their continued , belief and trust. With warm personal regards and in anticipation of an even better future. Dr. Prathap C. Reddy Executive Chairman Apollo Hospitals Group

We on our part fully realize that apart from our patient care focus, what is priceless to us as an organization, is our medical and professional manpower, all our employees as well as our shareholders’ capital which needs to earn a return over a specified time period. In this regard, I am happy that we have had another good financial year with consolidated

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Consolidated Financials

Annual Report 2013–14

I’m talking about your own individual health and the need to take care of it; it is your most precious resource apart from the time given to you, another precious resource, which is again finite. So the need to handle them both with utmost care cannot be over-emphasised.

Our investment in some of the best technologies like the Da-vinci Robot for minimally invasive surgeries, True-beam and Cyber-knife for Cancer treatment or our proposed Proton therapy centre – the first of its kind in this part of the world are targeted towards ensuring that we provide our patients care comparable to the best in the world.

As I end this note, I would like to reiterate that Apollo will work together with the new Government on these 21st century health challenges to try and create a unified Public Private Partnership framework based on the guiding principles of effectiveness, efficiency and equity.

Standalone Financials

While many people would ascribe this word to things like a work of art or a precious stone, and a few to resources like oil or for that matter water, seldom does one realise that probably the most precious thing on the surface of earth is the human body.

For us, the patient is at the centre of whatever we do or plan for, and patient care is the reason for your company’s existence, a very precious resource for the patient.

Business Review

Priceless

- the word is immediately associated with things of immeasurable value or inestimable worth. One always uses the word with reference to resources, which by definition are precious and scarce and therefore have to be managed with utmost reverence and care.

I have personally witnessed, in the course of my profession, the value of getting to know the state of one’s health through a timely health check. It gives one the power to manage health in a conscious manner and saves a lot of unnecessary effort, time and money; and it could perhaps save one’s life as well. In grave conditions as cancer, early detection could well mean the difference between life and death. I can state emphatically that certain cancers, if detected early, can be cured. At Apollo, we have done it repeatedly.

This certainly could not happen without the contribution of each one of our employees, our engaged workforce, in recognition of which we have been awarded the Gallup Great Places to Work Award (GGWA) for 2014. This award places the Apollo Group amongst the top few organizations globally on workplace engagement – making it one of the best places to work globally. This recognition is awarded to Organizations that have performed exceptionally in engaging their workforce and leveraging that strength to drive business results and sustainable growth.

Statutory Section

Dear Shareholders,

Our focus since inception has been on right diagnosis and accurate treatment planning before getting into the actual treatment itself and we continue to invest in some of the best technologies available on this front across all our hospitals. We continuously aim at improving our standards of clinical care to ensure all our hospitals deliver safe and quality care to patients, irrespective of location and size through The Apollo Standards of Clinical Care (TASCC) which embodies a set of process requirements and outcome measures that underlie the Apollo Hospitals approach to clinical care.

The standalone pharmacies have witnessed a 24% growth in revenues, while the EBITDA margins have expanded to 3.3% in FY14. We now have 1,632 stores in total and are the largest organised player in this segment. Our success on this front has come about through a combination of factors including the maturity of the store network, rationalisation of loss making stores and a gradual increase in the proportion of private labels in the product mix.

Corporate Review

Be it branching out from primary clinics to Sugar clinics or moving away from “Preventive health checks” to “Personalised health checks”, we have always tried to detect the disease or its symptoms early so that they can either be cured through treatment or controlled through medication.

Health is preserved and gained through a delicate combination of holistic practices such as a healthy mind, a balanced lifestyle, proper eating and soulful work. The preciousness and value of all life and especially human life is truly priceless. We need to be aware of this at every moment and also tell those around us. Health can be lost due to a variety of reasons and to preserve it, there are certain things which should be done: namely, stopping smoking, eating sensibly, getting enough exercise, adopting a holistic lifestyle through practice of yoga and meditation and getting a health check done regularly–a very small price to pay, for your priceless body.

annual revenues growing 16 % to ` 43.8 billion and consolidated net profits growing to ` 3.2 billion. Consolidated EPS for the year stood at 22.77 and I am pleased to announce a 115% dividend of `  5.75 per share for the fiscal year 2014.

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

The Apollo Ethos What sets us apart

Our Core

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Smart technology adoption

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Ability to attract good doctors

Our Focus

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To lead the way in clinical excellence by leveraging technology & innovation

To enhance patient experience & value

Focus on high end specialities & procedures

2

Focus on standardisation of clinical protocols

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Broad based service offerings for end to end care

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Stringent quality control norms & protocols

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Strong execution strategy

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Acumen to match care demand & market gaps with creation of assets

Why is our care different?

Preventive healthcare

Patient

Patient

Compliance

Engagement

Reactive

Proactive

Business Review

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Long term relationship with doctors & medical professionals

Statutory Section

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Indepth understanding of practice & industry

Corporate Review

A combination of underlying factors that will shape our future

Growth Drivers

Annual Report 2013–14

Inadequate government spends on healthcare (1.2% of GDP vs. 4.6% globally)

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ƒƒIncrease in working population ƒƒIncrease in ageing population ƒƒRising affluence ƒƒIncreasing penetration of health insurance ƒƒIncrease in elective health care

Changing disease profile

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ƒƒLifestyle-related chronic diseases ƒƒIncrease in NCDs ƒƒCancer ƒƒWomen’s health ƒƒTier II needs

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To Episodic

Relationship based communication

Medical Value Tourism

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Hospital

Consumer

at the core

at the core

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Consolidated Financials

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Inadequate infrastructure (1.1 beds per ‘000 people vs. 3 beds world average)

Standalone Financials

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India s for 20% of the world’s disease burden

Changing patient demographics

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

The Evolution of Apollo

2006-2010

The Road Travelled

Expansion Operational Highlights

Apollo Day Care Surgery launched — a dedicated facility



for minor surgeries requiring short stay

2009

Karur, Apollo Children's Hospital (Chennai)



Apollo Hospital at Karaikudi, Tamil Nadu.

2010

Secunderabad, Bhubaneswar, Lavasa, Hyderguda

2013

Hospitals in, Vanagaram (Chennai),



Jayanagar (Bengaluru) & Trichy

2011

Apollo Institute of Robotic Surgery launched - the first



world class robotic centre in Tamil Nadu, in collaboration



with the Vattikutti Foundation, USA



First in India to set up PET MRI System with PET mMR,



PET - CT mCT 128, RTP and Respiratory 4 D gating and a



standing MRI



Apollo Health City - Hyderabad recognised as Best



Medical Tourism Facility for 2009-2010 by GOI

2012

First of its Kind-Dental Wellness Centre in India, the White,



luxury dental spa launched



Placed order for Proton therapy equipment for Cancer

Started in Chennai with 150 beds

2001

Mysore, Bilaspur

2006

Apollo Hospitals, Chennai receives accreditation from

1988

Apollo Hospitals, Jubilee hills, Hyderabad

2002

First Med (Chennai), Apollo Gleneagles (Kolkata)



JCI, USA

1995

Apollo Specialty Hospital, Chennai

2003 Ahmedabad



Apollo Hospitals Hyderabad receives accreditation for



Acute Stroke from JCI, USA — the first hospital in the



world outside the United States to receive Disease Specific



Certification Apollo Hospitals, Bengaluru becomes the 6th Apollo

1996

Indraprastha Apollo Hospitals, Delhi

2005

First CRADLE launched in Gurgaon

1997

Apollo Specialty Hospital, Madurai



Kakinada

1988

First pharmacy retail outlet in Chennai

2002

Apollo Hospitals introduces nationwide single

2008



First of its kind CT Scanner- 4th Generation at Apollo



emergency number - 1066.



hospital to receive accreditation from JCI, USA



Hospitals Hyderabad

2002

The first Apollo Clinic inaugurated in Delhi



JV for hybrid umbilical cord blood bank along with Cadila

Apollo Hospitals Hyderabad- First in the world to use



Pharmaceuticals and StemCyte Inc.USA India’s first 320 slice CT installed in Chennai

First High frequency Cath lab in India at Apollo

2004



Hospitals Hyderabad



satellite technology for telemedicine





ICU at Apollo Hospitals Hyderabad equipped with

2005

First 16-slice PET CT Imaging System in South East



2,000 successful renal transplants completed



touch screen monitors- first of its kind in Asia



Asia launched at Apollo Hospitals, Hyderabad.

2009

Asia Pacific’s most advanced CyberKnife launched at

First 64-Slice CT Angio System launched at Apollo



Apollo Specialty Cancer Hospital, Chennai



Hospitals, Chennai



ACE@25, a clinical balanced scorecard with international

launched

2005

Apollo Hospitals, New Delhi becomes the first hospital



quality benchmarks launched in all Apollo Hospitals

1994



in India to receive accreditation from JCI, USA.

2010

Novalis TX radiosurgery inaugurated at Indraprastha

First 3 Tesla MRI in India in New Delhi



Apollo Hospitals

1991 1993

First international patient - from Middle East 24 hours ambulance service with wireless facility Teletherapy Unit and India’s first Dose Rate Micro

2005



Selectron installed at Apollo Specialty Hospital.

1996

First dedicated linac based stereotactic radio surgery



M-health services launched



unit - X knife with CLINAC 600 SR, outside of USA



Apollo Quality Program detailing methodologies for

1999

Dedicated stroke unit with 24 hours neurology cover,



Clinical Handovers, International Patient Safety Goals,



spiral CT scanner and Intra vascular Neuro lab and



Surgical Care Improvement and Zero Medication Errors



Intra Cranial Doppler - first in India



launched across the entire Apollo group.

2000

First telemedicine facility in the country inaugurated at



Aragonda by Bill Clinton, President of USA

2010

Successful Heart Transplant at Apollo Hospitals, Chennai



- for the first time on an American



Auditory brain implant performed independently for the



first time in India

2005

treatment 2013

Successfully completed 1,000 cases of Cyber Knife



Radio Surgery



Apollo Health City, Hyderabad performs revolutionary



Minimally Invasive Knee Replacement (Resurface) Surgery



using OrthoGlide Medial Knee system

2011

World’s first iPad Navigation Hip resurfacing Surgery



performed at Apollo Specialty Hospitals, Chennai in 2011



World’s first Single Incision Revision Bariatric Surgery in



July 2011



India’s first Robotic Bariatric program launched at Apollo



Hospitals, Chennai in 2011

2001

Apollo Specialty Hospital, Chennai completes 100



First Apollo Health check



Bone Marrow Transplants

1984

First kidney transplantation at Apollo Chennai

2004

First Drug eluting stent used at Apollo Hospitals



First Coronary Artery By Graft Surgery

Hyderabad

1988

Introduced Coronary Artery Stenting for the Ist time



First Cadaver Liver Transplant performed at Apollo



in India.



Hospitals Hyderabad

1989

IVF Unit creates medical history with the birth of a

2012

More than 130,000 cardiac surgeries performed with



baby by ‘GIFT’ procedure



99.6% success rate

1990

Revolutionary orthopedic surgery - equalizing of



Apollo performs more than 1,000 transplants in the year



limbs and deformity correction by llizarov



making it the busiest Solid Organ Transplant program in

procedure



the world

1994

Cardiac Surgery Programme completes



Apollo Hospitals Hyderabad performs first coronary



10,000 surgeries



angioplasty in India using fully absorbable stent

1995

First bone marrow transplant

2013

Chennai surgeons successfully separated Tanzanian



First multi organ transplant in the country at



Pygopagus coned Twins and created history in the



Apollo Hospitals, Chennai



medical field – first time in Asia



First Stereotactic radiosurgery unit in South Asia



Apollo performs a double-lung transplantation on a patient

1996

Successfully completed 1,000 renal transplants



suffering from a rare genetic condition known as the

1998

First successful pediatric and adult liver



Hermansky-Pudlak Syndrome - second in the world



transplants in India at Apollo Indrapastha Hospital

2014

Apollo completed 500 Robotic Surgeries in FY14 using the



Da Vinci Si System.

FY 2000

1,500 beds RX

25 stores

Revenues ` 2,684 mn.

FY 2005

4,000

beds

RX

170

stores

Revenues ` 6,621 mn.

FY 2010

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RX

7,984 beds 1,049

stores

Revenues `

20,265 mn.

FY 2014

RX

8,617 beds 1,632

stores

Revenues `

43,482 mn.

Consolidated Financials

First Cardiac Surgery (Atrial septal Defect)

Standalone Financials

1983

Business Review

Medical Achievements

RX

2011

Karimnagar

Statutory Section

Apollo Bengaluru

2008

1983



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2001-2005

2007

Corporate Review

1983-2000

2011-2014

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

The Year Gone By FY 14 at Apollo Hospitals*

A Typical Weekday in the World of Apollo

3,000,000

250,000 +

issions

Out-Patients

Preventive Health Checks

5,000 +

13,000

Heart Surgeries

t Replacements

Neuro Surgical Operations

20,000

1,500

800

600

300

Footfalls

issions

Major Surgeries

CT Scans

MRIs

Tender Loving Care

375

40

350

3–4

Kidney Transplants

Liver Transplants

100,000 +

1,000

Cardiac Surgeries

Dialysis

Organ Transplants

Pharmacy Walk-Ins

Health Checks

150,000 +

150

Radiotherapy Sessions

Countries Medical Value Travel

Bone Marrow Transplants

42,000 + Chemotherapy Sittings

$ ##

* FY14 info for owned hospitals only.   Does not include managed hospitals

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Representative Data Includes all owned hospitals, managed hospitals, Daycare Centres, CRADLE, Clinics & Pharmacies in the Apollo Network

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Consolidated Financials

120 8

Cost Benefit

Standalone Financials

Annual Report 2013–14

Robotic Surgeries

1,000 +

Business Review

500

Academic & Research Excellence

Cutting Edge Technology

Clinical Excellence

Statutory Section

10,000

##

Corporate Review

325,000 +

$

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Performance Financial Highlights

Five years at a glance All data in Rupees million, except for share data

Operating EBIT (Earnings before interest & Tax)

5,046

4,659

8%

Profit Before Tax

4,067

3,991

2%

Profit After Tax

3,168

3,044

4%

Earnings per Share (EPS)-Basic (`)

22.77

22.08

3%

Earnings per Share (EPS)-Diluted (`)

22.77

21.88

4%

6,724

11%

6,082

6,082

5,131

6,724

4,190

Operating EBITDA (Earnings before interest, Tax & Depreciation)

3,013

16%

43,842

37,687

37,687

43,842

Revenue from operations

31,475

Growth 26,054

FY 2013

2010

2011

2012

2013

2014

2010

2011

2012

2013

2014

EBIT

Statutory Section

FY 2014

EBITDA

20,265

Rupees million, except for share data

Corporate Review

Revenue

Consolidated Financial Highlights

PAT

Consolidated Financial Position

Shareholders Funds

29,612

27,313

Capital Reserve on Consolidation

155

155

Minority Interest

188

173

12,283

10,863

3,519

2,546

Annual Report 2013–14

Loan funds and Long term Provisions/Liabilities Deferred Tax Liability

3,168

41,050

2010

2011

2012

2013

2014

EPS (Basic) (` )

*  Includes cash & investment in liquid mutual funds of ` 4,151 million in FY14 & ` 6,822 million in FY13 #   Previous year numbers have been regrouped & reclassified wherever necessary to conform with current year classification 10

EPS (Diluted) (` )

22.77

45,757

3,044

Sources of Funds

2014

21.88

251

2,194

228

2013

16.30

Deferred Tax Asset

1,839

11,879

2012

14.37

12,142

Net Current Assets & Long term Advances * #

1,376

1,480

2011

11.10

1,661

5,046

Non-current Investments

2010

22.77

1,453

4,659

1,499

22.08

Goodwill

3,892

25,987

16.83

30,227

3,243

Fixed Assets

14.80

41,050

2,256

45,757

11.15

Application of Funds

2010

2011

2012

2013

2014

2010

2011

2012

2013

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Consolidated Financials

FY 2013

Standalone Financials

FY 2014

Business Review

Rupees million

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

The Apollo Commitment

To achieve these objectives we at Apollo rely on the shared values of the group on which we are founded and which we are proud to embrace. We are Responsible for ensuring better outcomes through focus on clinical excellence, superior diagnoses and treatment, use of technology and IT systems, to ensure superior patient experience.

We Collaborate within as well as with peers globally to drive thought leadership in health care delivery. We will leverage the deep experience of our doctors to derive the best possible treatment plans for our patients.

We will become Future Ready by using technology to build robust health care systems capable of addressing diverse patient needs and changing disease profile. We make our healthcare delivery Sustainable by balancing our long term vision with short term operational focus to create optimal value for our stakeholders.

We want to give distinctive care to every patient who walks into our facility. This commitment that we are making is Priceless to that objective.

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Consolidated Financials

Apollo will increase its broad based service offerings but continue to strengthen its core while emphasising on high end specialities and procedures and relying on innovation to improve clinical practices.

Standalone Financials

Annual Report 2013–14

Business Review

We adopt a Caring approach towards our patients who remain at the core of our existence and through Tender Loving Care, make a difference to their health and wellness.

Statutory Section

We Adapt to changing consumer demands and progressively expand our services repertoire in of improved quality of life for the patient.

Apollo has over 8,600 beds and over 1,600 pharmacies across India. Despite this geographic diversity, the vision and the values that drive the organization create a cohesive ‘One Apollo’ atmosphere at all points of the value chain. Apollo’s unique value proposition for the patient stems from the end-to-end care the group enables, the standard operating procedures, protocols and processes, innovative use of technology, and the experienced doctors who collaborate to elicit the best diagnoses and treatment plans. Apollo’s personalised patient care through differentiated products and services and the culture of empathy and patient centricity combined with a focus on patient wellness makes the brand trustworthy and affords the hospitals an intrinsic and sustainable strength that few others in the industry can match.

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Corporate Review

Apollo’s healthcare franchise comprises hospitals, clinics, day-care centres, pharmacies, and insurance. Backed by strong fundamentals and driven by clinical excellence, cutting edge technology and best in class doctors, the group’s patient centric approach to delivering healthcare services sets a high standard in the industry.

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Responsible Trusted Custodian of the Community’s Health

At the forefront of Apollo’s Medical Excellence is a team of internationally experienced and renowned doctors and surgeons who bring with them a collective hands-on experience of several hundreds of years. This combined with the group’s championship of first-class technology, systems and clinical protocols assures the highest quality of care for all patients at our various centres of excellence.

Statutory Section

Apollo's Centres of Excellence

Business Review

Through varying geographies and a diverse patient base, Apollo has consistently focused on clinical excellence and innovative technology for superior patient outcomes. These standards, a hallmark of Apollo Hospitals, have attracted medical tourists from over 120 countries to our hospitals. Apollo offers the same standards and quality of care that is available overseas at a much lower cost, making our hospitals the destination of choice for patients from around the world.

Standalone Financials

Whether it is ensuring the highest quality clinical practices that are benchmarked and rated with the best hospitals in the world, or focussing

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Annual Report 2013–14

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Priceless.

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on service excellence and patient experience, Apollo believes in providing differentiated treatment options and services to all patients.

Corporate Review

At Apollo we consider it our prime Responsibility to provide high quality clinical care to all our patients. Putting the patient at the core of our operations, we have developed robust quality standards, used expert diagnoses and treatment plans, and enhanced infection and safety protocols to render them the most appropriate treatment.

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

N e u r ology

C ardiol ogy

The Apollo Institutes of Neurosciences are equipped to treat the entire range of Neurological diseases.

Ort h o p ae d ics

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Were the first to perform Birmingham Hip Resurfacing procedure in India The hospital has a 99% success rate for Hip Resurfacing procedure Pioneers of Illizarov Procedure for limb lengthening in India Revolutionary Ceramic Coated Knee Replacement was performed for the 1st time in South India at Apollo Speciality Hospital, Chennai. Resorbable screws were used for the first time in India at Apollo Hospitals Chennai to correct congenital spine problem of a sixyear-old child from Tanzania. World's 1st iPod Navigation Hip Resurfacing Surgery was successfully performed at Apollo Speciality Hospitals, Chennai.

In 1995, Apollo Hospitals performed its first Bone Marrow Transplantation, as well as the first multi organ transplant in the country. Early in 2001, The Apollo Speciality Hospital, Chennai completed 100 Bone Marrow Transplants. „„

Tr a n s p la n t s „„ „„

The Apollo Transplant Institutes offers one of the world's most comprehensive solid organ transplant programs with a success rate of 90%

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Consolidated Financials

Annual Report 2013–14

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Services include Liver & Kidney Transplants, Corneal Transplants, Heart Transplants, Intestinal & GI Transplants & Pediatric Transplants State of the art infrastructure & equipment Team of renowned Transplant Surgeons, Nephrologists, Gastroenterologist's, Pediatric Surgeons, Anesthetists, Intensivists & Physicians

Standalone Financials

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Apollo Hospitals was the first Indian hospital group to introduce Stereotactic Radiotherapy and Radiosurgery for cancer treatment. Was the first hospital group in South-East Asia to introduce the 16 Slice PET-CT Scan. Introduced the most advanced CyberKnife® Robotic Radio Surgery System in the Asia Pacific, region, the world’s first and only robotic radiosurgery system designed to treat tumors anywhere in the body with submillimeter accuracy.

Business Review

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Pioneered open heart surgeries and cardiac catheterization, in the early 80's. Conducted over 140,000 cardiac surgeries - one of only 10 hospitals in the world to achieve these volumes. Achieved a 99.6% success rate in cardiac by surgeries; over 91% of which were beating heart surgeries. Introduced cutting edge procedures like off-pump and beating-heart surgery, either by thoracotomy (minimal invasive access) or classical sternotomy, transradial angioplasty and stenting, mitral valve replacement. First hospital group to bring the 320 Slice CT- Angio scan system and the 64 Slice CTAngio scan system to India First private healthcare provider to perform a heart transplant in 1995

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O n c ology

Statutory Section

Pioneers of Total Knee Replacement in India

Transsphenoidal surgery for pituitary tumors, spinal fusions, X-Knife for fractioned treatment of benign and malignant tumours (Stereo Tactic Radiotherapy) and many more cutting edge treatments make Apollo Hospitals a leader in Neurosurgical care Ably ed by modern Neuro-Radiology services, Neuro-Intensive Care facilities as well as Medical and Radiation Oncology services, Neurological specialists at Apollo Hospitals achieve outcomes matching those of the leading institutions across the globe

Corporate Review

The Heart Institutes at Apollo Hospitals, India represents one of the largest groups of Cardiology and Cardio-Thoracic Surgery in the world. The scorecard shows an unmatched record of over 140,000 heart surgeries, which include complicated coronary artery by surgery, surgery for all types of valvular heart disease and child heart surgery, with success rates comparable to international standards.

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Apollo’s ICU management and critical care, protocols and handover and its Emergency Care are among the best in the country. Whether it is in providing easy access to these services through a hotline or enhancing door to physician time, Apollo places a on putting patient needs above all else.

200+ ambulances

mts response time during emergencies

500,000+

Infection Controls „„ Our infection control protocols pertain to a wide

„„ „„

„„

Clinical Handovers

Annual Report 2013–14

500+

Emergency access number

<10

mts door to physician time

Methodical organization of critical care services influences outcome measures such as mortality, length of stay and infection rates.

<15

mts door to ECG in acute coronary syndrome

The National Network of Emergency Services „„ Emergency care of uniform

The CCU is a ‘semi-closed’ unit and high quality care is provided by the Critical Health Care team along with primary consultants.

quality standards across the country „„ 24 hour emergency and trauma care to meet all medical and surgical emergencies including poly-trauma „„ Common functional and medical protocols across the system

Special emphasis is placed on „„ nurses’ training „„ standardising care through

clinical pathways „„ the identification of ethical and

for Delhi, Ahmedabad, * Data Kolkata, Hyderabad,

economic issues pertaining to critical care

Bengaluru and Chennai

18

<30

mts door to CT in acute strokes

<30

mts door to needle in STEMI

<90

mts door to balloon in primary PCI

Apollo’s pioneering emergency care is a scientifically developed protocol-driven emergency system. It has: „„ well-equipped ambulances

manned by trained personnel „„ air ambulance services for

remote areas and life threatening emergencies „„ effective communication system between the central control room, the ambulances and emergency facilities in the hospitals

Emergency Care 19

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information at a glance to the care providers ƒƒ enhances ability of attending staff member to identify potential source of problem „„ Transfer of care from physician to physician or nurse to nurse in case of change of location or change of shifts „„ Includes accurate information about ƒƒ patient’s care ƒƒ treatment and services ƒƒ verbal order ƒƒ test results ƒƒ current condition ƒƒ recent or anticipated changes

1066

Standalone Financials

„„ Standardised procedure for clinical handover ƒƒ enhances patient’s safety by providing vital

Total Pickups (Monthly)

Business Review

„„

950

calls per day currently

The critical care units at Apollo integrate many specialities and diverse technologies offering hope to patients who are critically and acutely ill.

emergency footfalls (annually)

Statutory Section

„„

spectrum of interventions & have been developed tly with intensivists & anesthetists ICUs – high risk areas for patient where lifethreatening mistakes & omissions in care can occur Checklist of care should be addressed daily Critically ill patients highly vulnerable to health care associated infection, resulting in significant morbidity & prolonged length of hospital stay Reponsibility of every member of the health care team to ensure compliance with hospital and unit infection control policies – like hand-washing before & after examining a patient; use of alcohol hand rubs; use of sterile barriers & disposable gloves; safe disposal of all sharps & patient consumables; & traffic control Bedside Analysis – checklist use has reduced ALOS & improved infection control indices

calls served in 10 years

Critical Care

120,000*

Corporate Review

<10

ICU Management

220

Emergency Beds

Continuous clinical monitoring & improvement TASCC (The Apollo Standards of Clinical Care)

Leveraging IT for better patient care

Unique Hospital Identification Number

EMR

„„ Single health record for lifetime

„„ Provides detailed view of patient’s medical history „„ s timely and well-informed diagnosis

Corporate Review

HIMMS Analytics Asia-Pacific

„„ Enables doctor access without geographical limitation

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Level 6 Certfication

„„ Eliminates need for physical records

TA S C C Statutory Section

A C E   @  25 Apollo Clinical Excellence score card

Clinical Quality Parameters

Globally only 8.49% of hospitals have reached Stage 6

Parameters involve complication rates, rates, infection rates & ALOS –▶mortality after major procedures; compared with international benchmarks.

25

RACE

< 2.5% of hospitals in Asia Pac have reached Stage 6

Balanced score card for COEs

25 policies covering clinical care,

Apollo Clinical Policies, Plans & Procedures

Patient benefits

infrastructural requirements.

Standardised methodology of identifying deaths in a hospital with potential to have Apollo Mortality Review–▶resulted from an error through trigger criteria. Systematic peer review through a checklist & categorisation to identify preventable deaths.

AMR

Monitoring Systems

AIRS Apollo Incident Reporting System

Digital Healthcare Award

for tracking incidents that pose a –▶Mechanism safety risk to patients.

„„

Enhances safety & clinician

„„

Paperless environment with secure access to personal medical information

HIMSS-ELSEVIER

Programme for standardisation of processes for clinical handovers, medication safety, –▶ surgical safety, patient identification, verbal orders, handwashing compliance & falls prevention.

„„ Makes patient interactions seamless during care delivery „„ Enables appointments, access to medical records & remote consultation „„ Caters to Continuous Care delivery by interconnecting key stake holders like doctors, staff & labs

Breakthrough Innovation in Service Delivery

„„ Serves 2.5 mn patients around India „„ access provided during hospital registration

Standalone Financials

„„ For leveraging IT towards patient care & safety in creating Patient Engagement Platform - Apollo PRISM

Runner Up award for Breakthrough Innovation in Service Delivery (Patient Satisfaction Tracking System - survey to measure patient satisfaction)

AIMA

Parameter AQP Monitoring Dashboard Apollo Quality Programme

20

–▶ nursing care, managerial processes &

Business Review

APP

„„ Health records stored on private cloud

Patient Engagement Platform

20

PRISM 21

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„„ Records accessible over internet

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Giving hope at the world's busiest transplant centre

Adaptable Transforming Healthcare Service Delivery

st

Apollo believes in being adaptable to shifting consumer demands and patient demographics to best serve the interests of the community. As India’s middle class burgeons, as consumption patterns change and non-communicable diseases related to sugar, cancer and the heart abound, as the customer becomes increasingly informed and discerning, innovation within the realm of healthcare becomes Priceless.

1998

1999

1999

2008

2009

Successful adult cadaveric transplant

Simultaneous KidneyPancreas transplant in South India

Successful pediatric living related liver transplant

Successful liver transplant for Hepatitis B without immunoglobulins

Youngest pediatric liver transplant in India

Institutes of Robotic surgery Performed Asia’s heaviest (348 kg, BMI-112.5) bariatric surgery

Successful liverkidney transplant

The Apollo Institutes of Transplant form one of the world’s largest and most comprehensive solid organ transplant programs. It uses the best minds and cutting edge technology to deliver optimum solutions through transplants.

1,400 +

2009

Case of HermanskyPudlak Syndrome in India treated with double lung transplant

Renaissance System

Solid organ transplants in 2013 TM

Robotic Surgical

Patient Benefits

amage | Minimal Bl ue D o Tiss Risk of Infection | L od Lo ess ss ss Le duced ars | Faster Re Pain c S e e l R Visib cov ery s Les

s ie

m

in

all

i

in healthcare delivery will help transform the country’s healthcare eco-

M

State-of-the-art Equipment

analytical and cloud technologies to advantage, Apollo’s innovative solutions

i Si Surgical Syste m Vinc Da r Robotics Renais san zo a ce M ECMO | Cell Vizio

systematically pursues. With access to skills that can utilize social, mobile,

Institutes of Robotic Surgery

u y In vasive S

rg

Ca s rd dic Ur io lo g y | O rt h o p a e gy olo lo Gy g y | G a stro e ntero s nae c c olo g atri y | P ae di

system towards assured equity without disparity. Priceless.

„„

Robot guided system specifically designed for spine surgery

„„

First hospital to offer in Asia Pacific

„„

High accuracy and less radiation

Advantages

ECMO Extra-Corporeal Membrane Oxygenation system Life saving advanced intensive care technology

„„

Used in adults and children

„„

Used when the lungs or heart are not working properly

„„

Key to success is timely intervention of multiple organ failure

23

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„„

Areas where Used

22

175+

surgeries since launch

Standalone Financials

Robotic and minimally invasive surgeries are treatment options that Apollo

Micro Precisio n ility & Maneou Flexib vrab ater ility Gre

quality of life for patients through faster recovery and minimal discomfort.

er

Apollo is in the frontline driving that transformation. We seek to ensure

3

Business Review

Faced with a huge disease burden and a billion plus people from varying socio-economic backgrounds, India’s healthcare delivery challenges are ittedly complex but remain naturally hospitable to creative solutions that can address scale, reach and affordability.

Annual Report 2013–14

1998

Successful liver transplant in India

Statutory Section

1998

Private hospital to conduct a Heart Transplant in India

Corporate Review

1995

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Evolving healthcare through progressive thinking

Increased ICU turn-around.

Paperless Online Access (PRISM)

Primary Care Centres

Speciality Clinics & Day Care

Reduced narcotic usage for pain

ƒƒ

Faster recovery. ICU stay: 12 hours post procedure Ambulation within 6 hours of surgery

ƒƒ

ƒƒ

ƒƒ

Personalised

Checks

Health Checks

ƒƒ

(Angiogram)

(CT Angio, Fibroscan,

400+ Successful surgeries

Cell Vizio)

Faster return to work: 70% <10 days

9 days

Conventional heart surgery

4 days MICS

MICS involves no cutting. The heart is approached through a small 2" opening in the rib space on the left side. This leaves no deep scarring. 70% of patients needing CABG can now be adapted to MICS, creating a good outcome for the common man.

Minimally Invasive Cardiac Surgeries & Robotic Surgeries

24

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Annual Report 2013–14

ƒƒ

Coronary artery by surgery or CABG as it is commonly referred to is often a life saving procedure where blood supply to the heart is restored when vessels supplying the heart are blocked. The procedure has a recovery period that can extend to as long as 3 months disrupting normal life and work. Traditionally the procedure is done by cutting the breast bone or sternum open for easy access and this takes as long as 3 months to unite.

Cyber Knife & Proton Therapy

Invasive Cardiac Surgeries

Significantly reduced blood transfusion

Standalone Financials

Conventional LINACS

ƒƒ

Business Review

Non-invasive Diagnostics

Patient benefits

Invasive Diagnostics

Significantly reduced risk factors for other surgeries

Impact on hospital resources

Preventive Health

Precise surgery with very small incision & minimal scarring Eliminates deep wound infection

Statutory Section

Financial impact: Better bed utilization ƒƒ ALOS – conventional Heart surgery: 9 days ƒƒ ALOS – MICS: 4 days which includes 1 day for pre-surgery

ƒƒ

Corporate Review

Paper Medical Records

Minimally Invasive Coronary Artery Surgery (MICS)

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Human Sigma

Caring

1st in India to adopt Human Sigma by mapping customer and employee engagement to the Gallup “S” methodology

„„

Ranked this year among top 37 companies that partner with Gallup

„„

This recognises exceptional leadership that understands that engaging employees drives real business outcomes

„„

Apollo now among globally recognised organisations for mastering how to engage workforce to deliver sustainable growth

Guest Relations

Comionate Service Delivery

Service Excellence is a mintmark of Apollo. The Tender Loving Care of the nursing staff combined with empathy and a kind approach make a world of difference to patients giving them the confidence and emotional strength to get better faster.

„„

Apollo has adopted the engagement pathway for Voice of Customer (VOC)

„„

Partnered with Gallup to benchmark e-customer with best in class hospitals globally

„„

„„

In-house framework captures VOC from interactions and converts them into qualitative and quantitative for quick follow-up action Awarded “Best Innovation in Service Delivery” in 2013 by AIMA & Hospital Management Awards

Corporate Review

„„

issions

Core training module for all nurses

„„

Inspires the conversion of daily interactions into memorable experiences, resulting in enhanced courtesy index for nursing

„„

Tender Loving Care (TLC) - training for frontline staff

„„

TLC acknowledged as “Best Training Initiatives in Healthcare” at “Asian Learning & Development Leadership Awards” in Dubai in 2013

„„

Dedicated rooming experience that orients patients and attendees to various hospital services

Discharge „„

Post-discharge calls to patients for suggestions and 72 hours after discharge

„„

Speedy discharge summary for planned discharges

Business Review

This quality of patient care is possible in Apollo Hospitals because of an engaged workforce that takes pride in its day-today responsibilities. They are able to alleviate feelings of stress and fear in patients while instilling in them a positive approach towards treatment. Through small acts of kindness, they create a superior patient experience that few others are able to match.

„„

Minimises waiting time for planned issions

Statutory Section

Tender Loving Care

„„

The ‘Great Places to Work For’ award that Apollo recently won in an employee engagement survey conducted by Gallup, places Apollo Hospitals as amongst the top organizations to work for worldwide. Standalone Financials

The award is given to organizations that have performed exceptionally well in engaging their workforce and are able to leverage that engagement to

Service Excellence

drive business outcomes towards sustainable growth. Priceless.

A case study

Feeling for the Patient Annual Report 2013–14 26

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When a woman was itted to CCU and put on a ventilator, she was very distraught. The nursing staff found out that her son’s wedding was scheduled just a few days later and she was upset she would miss it. The staff knew this was really a once in a lifetime event. The ER and CCU team took the initiative to personally transport the patient to the wedding venue, creating an unforgettable experience for all concerned and much happiness for the patient. Priceless.

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Awarded recognition for the founding of the Healthcare Alliance by Dr. Prathap C Reddy to draw up strategies and recommendation for addressing challenges in healthcare in India and the rest of the world.

Collaborative Working Together to Enhance Solutions

The group’s collaborative approach to consultative learning and sharing of best practice through networks like the ACE Forum and the Tumor Board, ensures efficacy in diagnoses and treatment plans. Home to some of the best minds in medicine who are endowed with superior skills for treating patients, Apollo has several firsts to its credit spanning all its centres of excellence. Complex surgeries requiring multi-disciplinary teams of doctors and other professionals are an every day occurence within the walls of our Hospitals.

„„ Set up in 2008 „„ Furthers group’s commitment to clinical

„„ Team of eminent radiation, medical & surgical

excellence „„ Designed for consultants in the group & hosted on website „„ Offers platform for ƒƒdiscussion of medical innovations ƒƒsharing clinical best practices ƒƒoffering research ideas ƒƒgathering second opinion ƒƒposting information on papers published; accolades & awards won ƒƒdisseminating information on events

„„ Periodic meetings & discussions „„ Collective concurrence on accurate diagnosis „„ Uses learning & experience to evolve best

oncologists

treatment plan „„ Framework for learning & sharing best

practices „„ Calculated efforts for setting up clinical

excellence protocols

Statutory Section

Apollo cherishes collaboration in all spheres of its operations. Whether in clinical practices, innovation, partnerships, research or knowledge building, it harnesses the best available skills, knowledge and experience to enhance solutions for the patient.

Tumour Board

„„ Enviable track record for matching global

outcomes „„ Offers unparalleled learning & upgradation of

knowledge for oncology team

Group Practice Aims to organize full time consultants in different departments into group practice Creates opportunity for second opinion and mutual consultation as a group Utilizes collective skills and experience to handle difficult and complex cases Collective practice enhances patient confidence Improved scheduling for patients through call and vacation coverage Provides time for conferences and skill updation, academic activity & research Allows consultants to enhance their geographical reach by travelling to other locations

Business Review

„„ „„ „„ „„ „„ „„ „„

Peer review Standalone Financials

As a trusted healthcare provider, Apollo believes in health care equity for all and often convenes forums with renowned international and regional professionals and healthcare practitioners to discuss advancements in

Annual Report 2013–14

healthcare delivery, infection controls and patient safety. Priceless.

28

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Each speciality has performance measurement indicators that are measured individually for each consultant. A comparative analysis is then done with international benchmarks, the departmental average and individual performance. These are discussed during the departmental review along with peers to improve systems and practices and also used for individual consultant appraisal. Peer reviews also forms part of mortality reviews to identify the root-cause analysis of any death. Two peers from the same specialty independently conduct the reviews to indentify: „„ Clincial practice deficiency, if any „„ Delay in recognition of clinical deterioration „„ Escalation & response „„ Hospital acquired infection „„ Post procedure complication „„ Medical or communication errors The results are used to further our care protocols within the unit and aids in standardisation of treatment and clinical decisions.

3

Corporate Review

The Apollo Clinical Excellence Forum

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Driving solutions through knowledge building partnerships

A case study

India reports first ever surgical separation of Pygopagus twins

4th International Congress on Transforming Healthcare with IT

The defining moment in the lives of the nine month old boys who had been ed at the tail end of their spines at birth and shared a single anus and rectum, was when they were separated as two individuals. The historical marathon surgery which included re-constructive work, took 18 hours and involved a chosen team of 20 highly skilled doctors from the specialties of neurosurgery, plastic surgery, paediatric surgery and paediatric urology. Brilliant collaboration by doctors, surgeons, nurses, technicians, and others, underlies this mammoth effort that gifted two people a chance at life. Priceless.

September 2013 1,000 delegates – India & Overseas

3rd International Congress on Patient Safety

1

2

Statutory Section

September 2013 850 delegates – India & Overseas Theme: Patient safety tools & best practices

Corporate Review

In what is considered the first ever reported surgical separation of Pygopagus twins in India, a team of senior surgeons from across specialities undertook the very complex, lengthy and critical surgery in Chennai on December 16, 2013 on twin boys from Tanzania.

A case study Apollo Cancer Conclave

Liver transplant on a five month old

February 2014

3 Business Review

When a three month old in Oman developed jaundice and became progressively sick, doctors in the country recommended a liver transplant to save his life. As this facility was not available in Oman, the family travelled to Apollo Chennai for treatment. After weeks of collaborative care in the hospital, the baby’s condition was declared stable for the transplant. He was now 5 months old and barely weighed 5kg. The father donated the left lateral segment and the baby underwent a successful liver transplant. Post-operative recovery was rocky but he pulled through. The baby returned to Oman 2 months later. He is presently 3 years old, a bouncing young boy with a new lease on life. Priceless.

Future of Healthcare March 2014 Partners: AIMA, CII, FICCI, IMA, NATHEALTH, PHFL, Bain & Co., KPMG, McKinsey & Co. & PWC

4

A case study

Advanced therapy for cancer Standalone Financials

When a 44 year old lady was itted with vague abdominal pain, she was diagnosed with Advanced Ovarian cancer. After a few sessions of preoperative chemotherapy, she underwent removal of the uterus, ovaries, oviducts, cervix and related lymph nodes. Abdominal cyto reductive surgery was also performed after which she underwent HIPEC therapy. The procedure took approximately 7 hours. The patient had no intraoperative complications and had a smooth recovery. Drains and the Ryle’s tube were removed on day 2; oral sips started on day 3, full liquid diet from day 5 and solids from day 6 onwards. She was discharged on the 10th day and fared well during follow-up visits to the hospital. Priceless.

30

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Annual Report 2013–14

Cancer that has spread to the lining surfaces of the peritoneal (abdominal) cavity is very difficult to treat as chemotherapy is not very effective and side effects difficult to endure. HIPEC, a type of chemotherapy used in combination with surgery, where warmed anti-cancer drugs are infused and circulated in the abdominal cavity for a short period of time is an option in these cases. Apollo Hospitals is one of the few centres worldwide where the HIPEC technology is being used.

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

E–ICU

Future Ready Preparing to Meet Market Demands

India is being increasingly burdened with escalating healthcare requirements and is now the heart, cancer and diabetes capital of the world. In the face of this onslaught, private players and the government have to partner to bring uncompromised quality healthcare to the country’s masses.

Apollo offers home healthcare services for people with a serious illness or disability. The initiative provides: „„ Trained, screened & credentialed healthcare professionals „„ 24/7 live operator phone access „„ Transportation services from doctor’s office/hospital „„ High focus on patient safety, infection control & comfort

Main Benefits

Mobile Health Geriatric Care „„ Dedicated to the well-being and health of elderly people „„ Holistic approach that employs best ways to maintain or improve functional ability, physical health, cognition and mental health „„ Services include: ƒƒOutpatient and inpatient care ƒƒEmergency care ƒƒHome healthcare

Tele Radiology

Priceless.

32

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The state of the art Tele-Radiology centre inaugurated in 2013 serves to extend reach and radiology services beyond the boundaries of a single hospital. It is envisioned that the centre will soon cater to requirements across international borders as well.

„„ Comprehensive Health Screening programme „„ Tailor made packages to cater to rich assortment of individuals „„ Convenience of all tests, specialists, consultations and treatment under one roof „„ Reports and reviews within 24 to 36 hours „„ Early indicator of disease risk „„ Comprehensive wellness programme for health goals. Includes appropriate medical intervention for preventive controls

Standalone Financials

Personalised Healthcare

Alongside we also believe it is our responsibility to educate people about Annual Report 2013–14

With the explosion in mobile phone usage in India, the emerging mobile health industry is expected to become a 1 billion dollar opportunity by 2020. Apollo is already a step ahead and has made PRISM and E–doc (an application that allows a patient to electronically book an appointment with a doctor), mobile-ready. Radiology and CT scan reports will be also made accessible on a mobile phone. This Mobile Health system will improve information flow and patient-doctor connectivity. Apollo is continuously working on this front to widen & deepen its medical offerings using Mobile Health.

Business Review

Developing infrastructure, establishing inclusive business models with appropriate pricing to address demand, and tackling scale, are key areas that need attention. Apollo is ahead of the times in addressing these through innovative technology driven solutions. In an environment where it takes just one mistake to cause a negative outcome and one minute to make the difference between life and death, Apollo has successfully leveraged information technology to create robust and patient centric healthcare systems that can improve response times, reduce human error, save costs, and impact quality of life. We benchmark our performance and practices with the world’s best hospitals and lay on-going emphasis on continuous improvement.

healthy living, wellness and lifestyle management.

Statutory Section

„„ Minimises need for hospitalisation & enables faster discharge „„ In-home consultation „„ Faster physical control & recovery

Corporate Review

Care Continuum

This multitasking portal and workstation leverages technology to enhance reach for treating patients in a remote ICU from an Apollo Hospitals E-ICU hub. Using it, doctors can get a summary of the patient’s vital signs and lab results. Through the InteleEYE, a remote intensivist can monitor and interact with patients in several ICUs and hold discussions with the care teams. The Remote Wave Form Viewer provides intensivists access to the ICU’s patient monitor waveforms and events, enabling them to treat patients regardless of physical location. Audiovisual systems provide a bedside view of the patient. All clinical applications and algorithms in the Tele ICU are FDA compliant.

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Cardiac and Neuro Rehab

Bio-Banking is a very important aspect of Life Sciences. Apollo’s ethical bio-repository will provide a catalogued library of bio-samples which can be leveraged to create an information repository comprising of RNA, DNA & genetic information.

Apollo provides specialised post-acute neurological, cardiac & orthopaedic rehabilitation services with an aim to improve a person’s overall quality of life – physically, emotionally, & socially after heart disease or physical injury. It addresses the prevention & correction of secondary effects of physical injury, cardiac & neurological illness.

„„ „„

„„ „„

Cardiac–rehab

Drug Discovery & Services „„ Create custom cell lines & tumour microarrays „„ Target & Biomarker Services „„ Discovery & validation using primary human cells „„ Genomics & proteomics services „„ Drug Discovery related services „„ Idea-to-IND phase collaborative drug discovery programmes „„ Human Cell based Phenotype screening services

The Neuro Rehab Programme

„„

ƒƒstroke ƒƒspinal cord injury ƒƒtraumatic brain injury ƒƒmultiple sclerosis ƒƒ small children with cerebral

palsy.

„„

„„

Genomics (Oncology)

Doctor-supervised with a multi-disciplinary team of trained physiotherapists, occupational therapists, speech therapists, psychiatrists & other specialists & counsellors.

It is designed for people with diseases, trauma, or disorders of the nervous system & will benefit movement disorders caused by:

It aims to help patient return to the highest level of function and independence possible through alternate techniques & skills to compensate for paralysis or weakness.

Neuro–rehab

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Continuing its legacy of pioneering healthcare changes in India, Apollo through Sapien BioSciences (An Apollo subsidiary) is now set to introduce clinical genomic tests. The first of these, will be a clinical genomics for oncology that is designed to identify the mutations that drive cancer initiation and progression. Insights obtained from this test will reportedly enable prediction of patients’ response to their medication allowing the physician to tailor treatment to the patients’ genomic profile. 

It offers physical therapy using robotic & virtual reality equipment & also provides nutritional & psychiatric .

„„

Standalone Financials

Annual Report 2013–14

„„

Improves function, reduces symptoms & enhances the well-being of the patient.

Business Review

Bio-Banking

„„

The Life Centre identifies individual’s exercise capacity, lifestyle, dietary habits, & stress levels Aims to correct lifestyle and chronic risk factors Provides holistic recovery and restoration solution - customises training programme to improve cardio-respiratory fitness Prepares personalised diet plan & educates person about lifestyle changes Provides specialised therapeutic yoga sessions Conducts stress management & group counselling sessions

Statutory Section

Clinical Services „„ Treatment Optimization „„ Molecular Diagnostics „„ Clinical Services „„ Stratification of clinical trial populations „„ Research & Bio-repository Services

Corporate Review

„„

cities and have creatively leveraged technology and information systems to

Sustainable

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

provide patients’ access to our world-class doctors regardless of physical

Anchored for the Future

location. Apollo offers the highest standards of quality with zero compromise on patient safety. Our robust infection control norms and protocols as well as our policy to use the best consumables are based on sustaining our group’s long term competitive position in the industry.

Statutory Section Business Review Standalone Financials

While we have consistently delivered superior returns to all investors and stakeholders, we believe that we have a well planned strategy to deliver the next phase of growth. Our aim is to: gg continue cluster strategy for expansion with greenfield projects in attractive newer markets gg garner higher market share in select acute and tertiary care services gg focus on Centres of Excellence with specific plan to further penetrate into Cardiology and Oncology specialties gg enhance Out-Patient focus by creating value differentiators and leveraging on personalised health checks advantage gg optimise asset utilisation and focus on cost efficiencies in flagship facilities and locations gg strengthen core value proposition by well defined clinical pathways and protocols gg set benchmark standards in clinical outcomes, technology and practices gg leverage brand value and enhance customer reach through investment in primary clinics, sugar clinics, dialysis centres and dental care as separate focus verticals

While the opportunity space that we work in is large, our strategy is centred on strengthening our presence in key strategic markets with the right balance of risk-reward. A compelling businesscase is a prerequisite for any investment decision taken by us on expansion. Our business strategy ensures focus on what is best for the patient while complementing the need to generate strong financial returns for the shareholder. This forms the core of Apollo’s sustainable strategy.

Priceless.

Apollo’s “reputational currency” and the trust and loyalty of our customer are very important to us and remain on top of whatever healthcare initiative or business-line we embark on. We have expanded our footprint into Tier 2 36

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Annual Report 2013–14

Corporate Review

Apollo’s mission of delivering healthcare of international standards along with its commitment to excellence, forms the essence of its strategy. Apollo Hospitals aspires to be a transformational healthcare provider capable of addressing the scale and complexity of India’s disease burden. In single-minded pursuit of this goal, we manage the healthcare delivery value chain through systemic innovation and continuous improvement in product, process and technology.

Sustainability requires the right balance between long-term and short-term goals and while we continue to invest for the long-term, the operating teams focus on short-term goals.

Long - term Sustainability Parameters

Short - term Operating Parameters

(15 y e a r ti m e p e ri o d )

(5 yea r t im e per io d)

2000 1995

6,621 2,684

4 57

2010

3,006

2005

1,16 7

2000 1995

2014

6,724

715

2013

313,3 48

201 2

281,020

2011

265,425

2010

1 27

5,811 #

2014

331,6 7 8 Ope ra t i n g beds & Oc c upa n c y ra te

2005

ca g r 2 3%

EBI TD A (` mi l li o n )

20,265

ca g r 27 %

2014

I n - pa ti en t a d mi ssi o n s

43,842

Co ns i s te nt B e d U t i l i sa t i o n

S te a d y Vo l ume G r owth

5,549 #

2013

4,257 #

2005 2000 1995

D e bt Eq ui ty

1,376 384 27 8

0.4 5

4 5,072 14,643 4,977 538

0.69

ca g r 33%

2014 2010 2005

25 $

1995

750 * N A$

4.7 8

2011

4.79

2010

4.84

2014

2.66% 1.91%

2011 2010

* Beds includes both owned & managed hospitals $ Number of Stand- Alone Pharmacies

0.47%

2 3,684

2013

21,724

201 2

20,4 55

2011

18,474

2010

16,952

Ma tur e S to r e s ( P r e F Y 0 8 ) E BI TD A M a r g i n s 3.29%

201 2

1,500 *

2000

201 2

2013

3,000 *

170 $

4.65

2014

5,376 *

1,049 $

2013

ca g r 9%

S AP E BIT DA Ma r g i ns

6,684 *

1,632 $

4.54

2014

5.65% 5.29%

2013

4.63%

201 2 2011 2010

3.57% 1.3 4%

-2.07%

39

3

Contents

4

Consolidated Financials

38

2000

S t eady Hos pit al & Pharma cy Expans i o n

Be d Count & P harm acy Cou nt

Marke t C ap

1 27,500

2010

1995

0.42

2005

2014

Operating Beds

Standalone Financials

2014

2000

0.44

2010

1995

63

Su p e r i o r S h ar e h olde r Re tu r n s

2005

0.35

71%

Inc r e a s e d R e a l i sa t i o n P e r B e d

Av e ra g e Re v e n ue Pe r Oc c upi e d Be d (` pe r d a y )

2010

2014

ca g r 2 3%

Av e ra g e L e n g th of S ta y (AL OS ) D a y s

3,168

72%

Business Review

PAT ( ` mi l l i o n )

2014

Fa s te r P a ti e nt Tur na r o und & Be tte r Uti l i za ti o n

L ow Gearing

71%

4,76 7 #

2011

#

Su s t ai n e d P rofitability

73%

5,153 #

201 2

2010

2 35,160

73%

Statutory Section

Re v e n ue (`   mi l l i o n )

2014

Cons is t ent EBIT DA

Corporate Review

S t r o n g R even u e G r ow th

2010

Our cluster based operational focus and growth strategy helps us drive operating efficiencies and profitability while providing patients with a comprehensive set of sub-specialities & treatment services.

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Socially Conscious Touching the Community

k

Ta

e

40

surgeries performed

380 copies of

„„ Provides early diagnosis, treatment, surgery, post-operative

care and financial

350,000

‘the healer’

sold for fund-raising

22

CMEs covering 3,000 beneficiaries

on

BHB’s website

}

100,000 beneficiaries of free

Apollo healthchecks

400,000 fan following on facebook

NCC, AISEC & the World Heart Federation (Geneva) ed by

SAHI - A Society to Aid the Hearing Impaired

9 camps in

CURE - An Apollo Hospitals Cancer Care Initiative „„ The CURE foundation – an effort to bring cancer care to

those who cannot afford it „„ Extends preventive as well as rehabilitative cancer

treatment to the economically backward „„ Objectives ƒƒ Promoting prevention & early detection ƒƒ Spreading knowledge ƒƒ Providing treatment options ƒƒ Rendering rehabilitation & care

FY14

Health Camps & Awareness Programmes (FY14)

1,300 patients screened

„„ „„ „„ „„ „„

35 cochlear implant surgeries funded

42

micro-ear surgeries performed

* Data for Chennai, Hyderabad, Delhi, Kolkata and Bengaluru.

3

Over 400 health camps; 100,000 beneficiaries 300 speciality clinics, camps & screening programmes 300+ Health Talks and CMEs; 28,000+ attendees 26 Rural Health E-Wellness Sessions; 5,500 attendees from 16 villages Round the year blood donation drives, doctor meets, vocational training for women, & ‘Green Events’ to create social awareness 41

Contents

4

Consolidated Financials

little or no access to modern medical treatment

375+

people have taken pledge

„„ Identifies hearing impaired children, mainly in rural areas, with „„ Provides high quality medical and surgical services

300+

for the underprivileged

70 campaign events till date

2014

children screened

„„ Established in 2003 „„ Dedicated to paediatric cardiac care and child heart surgery

Billion Hearts Beating (BHB)

Launched April 2010 Aims to inform, educate & trigger positive action towards heart disease Addresses different socio-economic sections across the country The Simple 5 Solution – BHB’s comprehensive lifestyle guide: get active; eat healthy; quit smoking; beat stress; get a regular health check

}

32 screening camps in

Standalone Financials

Annual Report 2013–14

}

lives touched till date

Business Review

„„ „„ „„ „„

ed g e e Pl th

50,000

Statutory Section

Priceless.

SACHi - Saving a Child’s Heart initiative

Corporate Review

}

In an on-going effort to raise awareness about the value of health and wellness amongst India’s diverse population, and in enabling healthcare equity across the various socio-economic groups in the country, Apollo Hospitals runs awareness campaigns, facilitates surgeries and treatments, and conducts health camps in both urban and rural areas on a regular basis. The following activities* provide a birds eye view of this large scale effort.

Performance Performance Highlights Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

The Board

Corporate Information

Bankers

Shri. K. Panabhan Group President

Shri. S.K. Venkataraman Chief Strategy Officer

Smt. Preetha Reddy Executive Vice Chairperson*

Smt. Suneeta Reddy Managing Director*

Chief Financial Officer

Smt. Shobana Kamineni Executive Vice Chairperson*

Shri. S.M. Krishnan Sr. General Manager – Finance & Company Secretary

Auditors

ed Office

M/s. S. Viswanathan Chartered ants Chennai - 600 004.

Shri. Deepak Vaidya Director

Shri. Habibullah Badsha Director

19, Bishop Gardens, Raja Annamalaipuram, # Chennai – 600 028

Corporate Office

Shri. Khairil Anuar Abdullah Director

Sunny Side Building, East Block, 3rd Floor, No. 8/17 Shafee Mohammed Road, Chennai – 600 006

istrative Office

Business Business Review Review

Smt. Sangita Reddy t Managing Director*

Andhra Bank Axis Bank Bank of Tokyo Canara Bank Citi Bank HDFC Bank HSBC ICICI Bank IDBI Bank Indian Bank Indian Overseas Bank Oriental Bank of Commerce State Bank of Travancore

Statutory Statutory Section Section

Shri. Krishnan Akhileswaran Dr. Prathap C Reddy Founder and Executive Chairman

Corporate Corporate Review Review

Senior Management Team

li Towers, # 55, Greams Road, Chennai – 600 006. A E-mail: [email protected] Website: www.apollohospitals.com

Shri. G. Venkatraman Director

42

Shri. Sanjay Nayar Director

Shri. N Vaghul Director

Audit Committee

Shri. Vinayak Chaterjee Director*

Stakeholders Relationship Committee

Nomination & Remuneration Committee

Investment Committee

Share Transfer Committee

Corporate Social Responsibility Committee

Shri. Deepak Vaidya Chairman

Shri. Rajkumar Menon Chairman

Shri. N.Vaghul Member

Shri. N. Vaghul Chairman

Shri. Rajkumar Menon, Member

Shri.Rafeeque Ahamed, Chairman

Shri.G.Venkatraman Member

Smt. Preetha Reddy Member

Shri. Deepak Vaidya Member

Shri. Deepak Vaidya Member

Smt. Preetha Reddy Member

Smt.Suneeta Reddy Member

Shri.Rajkumar Menon Member

Smt. Suneeta Reddy Member

Shri.G.Venkatraman Member

Shri. Vinayak Chatterjee, Member

Shri. Rafeeque Ahamed, Member

Smt. Sangita Reddy Member

Shri. Rafeeque Ahamed, Member

Smt. Preetha Reddy Member Smt.Suneeta Reddy Member

*  With effect from 2nd July 2014

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Consolidated Consolidated Financials Financials

Annual Report 2013–14

Shri. Raj Kumar Menon Director

Standalone Standalone Financials Financials

Shri. Rafeeque Ahamed Director

of their subsidiaries in their annual reports subject to fulfillment of certain conditions prescribed. The Board of Directors of the Company at its meeting held on 28th May 2014, noted the provisions of the MCA circular cited and

Directors' Report to the Shareholders

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

ed the necessary resolution granting requisite approvals for not attaching the Balance Sheet, Profit & Loss , Report of the Board of Directors and Report of the Auditors of each of the subsidiary companies to the s of the Company. A statement of summarized financials of all subsidiaries of your Company, pursuant to Section 212(8) of the Companies Act, 1956 forms part of this report. Any further information in respect of the annual on request and will also be available for inspection for any member at its ed Office. In accordance

Your Directors are pleased to present the THIRTY THIRD ANNUAL REPORT and the audited statements of

with the ing Standard, AS-21 issued by the Institute of Chartered ants of India, the Consolidated

s for the year ended 31st March 2014.

Financial Statement presented by your Company includes the financial information of all its subsidiaries.

Financial Results (Standalone)

Dividend

For the year ended

33,178

4,201

4,034

894

988

3,307

3,046

-

45

Net Profit after Extraordinary Items

3,307

3,091

Balance of Profit brought forward Dividend paid on equity shares

2,307

1,763

-

22

5,614

4,832

936

895

1,500

1,000

13

630

3,165

2,307

Provision for Taxation Net Profit before Extraordinary Items after Taxation Extraordinary Items

(arising on conversion of FCCB loan & share warrants) Profit available for appropriations

(as against ` 5.50 per equity share on face value of ` 5/- each, 110% in the previous year) on the paid up equity share capital of the company for the financial year ended 31st March 2014, which if approved at the forthcoming Annual General Meeting on 25th August 2014 will be paid to those shareholders whose names appear in the of as at the closing hours of business on 18th August 2014. 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 of and Share Transfer Books will remain closed from Tuesday, 19th August 2014 to Monday, 25th August 2014 (both days inclusive).

Transfer of Reserves Your Company proposes to transfer ` 1,500 million to the general reserves out of the amount available for appropriations. An amount of ` 3,165 million is proposed to be retained in the Profit & Loss .

Appropriations Dividend (inclusive of dividend tax) Transfer to General Reserve Transfer to Debenture Redemption Reserve Balance carried forward to Balance sheet

Business Review

38,616

Profit before Extraordinary Items and Taxation

The Board of Directors recommend a dividend of ` 5.75 per equity share (115% on face value of ` 5/ - per share)

(` in million) March 31, 2013

Statutory Section

Income from operations

March 31, 2014

Corporate Review

report and the financial statements of the subsidiary companies of your Company will be made available to the

Credit Rating CRISIL has rated the company’s debt instruments as AA indicating a high degree of safety. CRISIL Equities has upgraded Company’s CRISIL IER fundamental grade to 5/5 from 4/5. The grade indicates that the company’s fundamentals are ‘excellent’ relative to other listed equity securities in India.

Subsidiaries

During the year under review, the income from operations of the Company increased to ` 38,616 million compared to ` 33,178 million in the previous year, ing an impressive growth of 16%. The profit after tax for the year

Your Company has fourteen subsidiary companies (including fellow subsidiaries) as on March 31, 2014. The

increased by 7% to ` 3,307 million compared to ` 3,091 million in the previous year.

statement in respect of the details of the subsidiary companies viz., Unique Home Health Care Limited (UHHCL), AB Medical Centres Limited (ABMCL), Samudra Healthcare Enterprises Limited (SHEL), Apollo Hospital (UK)

During the year under review, the consolidated gross revenue of the Company increased to ` 43,842 million

Limited (AHUKL), Apollo Health and Lifestyle Limited (AHLL), Western Hospitals Corporation Pvt Limited (WHL),

compared to ` 37,687 million in the previous year, ing an impressive growth of 16%. Net profit after minority interest for the group increased to ` 3,168 million from ` 3,044 million representing a growth of 4%.

, Apollo Nellore Hospital Limited (ANHL) (formerly Pinakini Hospitals Limited), Imperial Hospital and Research

Consolidated Financial Statements

Apollo Bangalore Cradle Limited (ABCL) formerly Apollo Koramangala Cradle Limited, Apollo Clinics (Gujarat)

Centre Limited (IHRCL), Alliance Medicorp (India) Limited (Alliance), Sapien Bio Sciences Pvt Limited (SBPL), Limited (ACGL), Apollo Cosmetic Surgical Centre Pvt Limited (ACSPL) and Alliance Dental Care Limited (Alliance

The Ministry of Corporate Affairs (MCA) vide its circular No. 5/12/2007-CL-Ill dated 8th February 2011 had granted

Dental) pursuant to section 212 of the Companies Act, 1956, is attached to this report.

general exemption under Section 212(8) of the Companies Act, 1956 to companies from attaching the s

44

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Consolidated Financials

Annual Report 2013–14

Standalone Financials

Results of Operations

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Unique Home Health Care Limited (UHHCL) UHHCL, a wholly owned subsidiary of the Company provides medical and paramedical services including doctor’s

Apollo Bangalore Cradle Limited (ABCL) (formerly Apollo Koramangla Cradle Limited)

consultation, physiotherapy direct to patient homes and also offers paramedical services in hospitals to critically

ABCL, a subsidiary of Apollo Health and Lifestyle Limited is engaged in the business of healthcare service. For

ill patients. For the year ended 31st March 2014 UHHCL, recorded a revenue of ` 25.56 million and net profit

the year ended 31st March 2014, ABCL recorded a revenue of ` 150.77 million and a net loss of ` 33.69 million.

of ` 2.02 million. ACGL, a subsidiary of Apollo Health and Lifestyle Limited is engaged in the business of healthcare services. For

ABMCL, a wholly owned subsidiary of the Company does not have any commercial operations as it has leased

the year ended 31st March 2014, ACGL recorded a revenue of ` NIL million and a net loss of ` 0.10 million.

out its infrastructure viz., land, building and medical equipment to the Company for running the hospital. For the year ended 31st March 2014, ABMCL recorded an income of ` 6.41 million and a net profit of ` 4.44 million.

Apollo Cosmetic Surgical Centre Pvt Limited (ACSPL)

Corporate Review

Apollo Clinics (Gujarat) Limited (ACGL) AB Medical Centres Limited (ABMCL)

ACSPL, a subsidiary of Apollo Health and Lifestyle Limited is engaged in the business of running cosmetic

Samudra Healthcare Enterprises Limited (SHEL)

surgical centres. For the year ended 31st March 2014, ACSPL recorded a revenue of ` 50.44 million and a net

SHEL, a wholly owned subsidiary of the company, runs a 120 bed multi speciality hospital at Kakinada. For the

loss of ` 0.50 million.

year ended 31st March 2014, SHEL recorded revenues of ` 279.56 million and a net profit of ` 3.36 million. Alliance Dental, a subsidiary of Alliance Medicorp (India) Limited is engaged in the business of running dental

AHUKL is a wholly owned foreign subsidiary of the Company and has not yet commenced its operations.

clinics. For the year ended 31st March 2014, Alliance Dental recorded a revenue of ` 272.77 million and a net loss of ` 18.59 million.

Apollo Health and Lifestyle Limited (AHLL) AHLL, a wholly owned subsidiary of the Company is engaged in the business of providing primary healthcare

Corporate Governance

facilities through a network of owned/franchised clinics across India offering specialist consultation, diagnostics,

Pursuant to Clause 49 (VII) of the Listing Agreement with the Stock Exchanges, a separate report on Corporate

preventive health checks, telemedicine facilities and a 24-hour pharmacy all under one roof. For the year ended 31st March 2014, AHLL recorded a consolidated revenue of ` 1,149.33 million and a net loss of ` 326.96 million.

Governance forms part of the Directors’ Report in the Annual Report. Your Company has been complying with the

Western Hospitals Corporation Private Limited (WHL)

Governance Report.

For the year ended 31st March 2014, WHL, a wholly owned subsidiary of the Company, recorded revenue of

A certificate from the Auditors of the Company regarding compliance with the conditions of Corporate Governance

` 11.61 million and a net profit of ` 7.92 million.

as stipulated under Clause 49 of the Listing Agreement is attached to this report.

requirements of the Listing Agreement and necessary disclosures have been made in this regard in the Corporate

Business Review

Apollo Nellore Hospital Limited (ANHL)

Awards

ANHL has leased out its land at Nellore to the Company. ANHL recorded revenues of ` 7.42 million and a net profit of ` 4.84 million.

•

Imperial Hospital and Research Centre Limited (IHRCL)

•

Apollo Hospitals has been awarded the Gallup Great Places to Work Award (GGWA) for the year 2014 in recognition of exceptionally leveraging its workforce to drive business results and sustainable growth.

ended 31st March 2014, IHRCL recorded a revenue of ` 1,469.35 million and a net profit of ` 51.67 million.

•

Dr. Prathap C. Reddy, Chairman, Apollo Hospitals Group was conferred with the Lifetime Achievement Award at the Asian Business Leadership Forum Awards 2013.

Alliance Medicorp India Limited (Alliance) •

Alliance, a 51% subsidiary of the Company is engaged in the business of running dialysis clinics. For the year ended

Standalone Financials

Dr. Prathap C. Reddy, Founder and Chairman of the Apollo Hospitals Group was honoured with the Lifetime Achievement Award by NDTV.

IHRCL, a 85.76% subsidiary of the company owns a 240 bed multi speciality hospital at Bengaluru. For the year

Dr. Prathap C Reddy was also conferred with the Lifetime Achievement Award by CNBC TV18 at the 9th edition of India Business Leaders Awards 2013

31st March 2014, Alliance recorded consolidated revenue of ` 309.72 million and a net loss of ` 27.13 million. •

In the Week-Nielsen Hospital Awards 2013, 3 Hospitals from the Apollo Network were recognised as being

Sapien Biosciences Pvt Ltd (SBPL)

among the Top 15 Multi-specialty Hospitals in India. Chennai (#4), Delhi (#9) and Hyderabad (#14) have been

SBPL, a 70% subsidiary of the company which is engaged in the business of bio-banking of tissues is currently

conferred with this prestigious honour. Chennai and Delhi have featured in the list of Top 10 hospitals in India

in the startup stage. For the year ended 31st March 2014, SBPL recorded a revenue of ` 0.67 million and a net

for the 6th year in a row. These two facilities have also featured in the list of Best Hospitals in India for the

loss of ` 6.35 million.

specialties of Cardiology and Oncology.

46

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Consolidated Financials

Annual Report 2013–14

Statutory Section

Alliance Dental Care Limited (Alliance Dental)

Apollo Hospital (UK) Limited (AHUKL)

•

Apollo Health City, Hyderabad has been bestowed the prestigious ‘International Medical Tourism Award’ for

pace of growth and optimize profitability. She will directly steer the hospital vertical and will also handle Brand

Excellence in Customer Service. This has been awarded by the reputed International Medical Travel Journal,

and Marketing.

UK. Apollo Health City was the only hospital from India to be nominated.

Smt. Shobana Kamineni has been re-designated as Executive Vice-Chairperson of the Compnay. She will continue to spearhead Apollo Pharmacy related initiatives and will also oversee the planning, design and execution of new

Directors' Responsibility Statement

projects and will lead the Apollo Global Projects Consultancy Division.

•

Smt Sangita Reddy will take charge as t Managing Director of the Company and will assume greater

In the preparation of the annual s for the year, the applicable ing standards had been followed

responsibilities which will include creating an IT enabled patient centric operation across the Apollo footprint.

along with proper explanations and there were no material departures;

She will continue to steer Apollo’s thrust on research, innovation and healthcare initiatives. In growing the group’s

The Directors had selected such ing policies and applied them consistently and made judgments

retail healthcare foray, Sangita will also spearhead Retail Health, including running Clinics, Cradles and other retail service formats. She will also lead the Human Resources and IT functions across all divisions of the Group. The

and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the

other and conditions including remuneration of the Executive Directors as approved by the at the

Company at the end of the financial year and of the profit of the Company for that period; •

earlier Annual General Meetings remain the same.

The Directors had taken proper and sufficient care for the maintenance of adequate ing records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and

Smt. Sangita Reddy, Director retires by rotation at the ensuing Annual General Meeting and being eligible offers

The Directors had prepared the annual s on a going concern basis.

herself for re-appointment.

Fixed Deposits

Shri. Sanjay Nayar was appointed as an additional director with effect from 10th February 2014 and holds office

In view of the new Companies Act, 2013 requirements, the Company can accept deposits from the public and

upto the date of the ensuing Annual General Meeting.

only after obtaining approval from the at the ensuing annual general meeting.

Shri. Vinayak Chatterjee was appointed as an additional director with effect from 2nd July 2014 and holds office

The total deposits with the Company as on 31st March 2014 was ` 355.38 million (` 367.61 million as on 31st

upto the date of the ensuing Annual General Meeting.

March 2013) which include deposits and interest thereon for an aggregate value of ` 4.40 million (` 25.31 million

In of Sections 149, 152 and other applicable provisions of the Companies Act, 2013 read with Rules made thereunder, the Independent Directors viz., Shri. N. Vaghul, Shri.Deepak Vaidya, Shri. Rafeeque Ahamed, Shri.Rajkumar Menon, Shri. Habibullah Badsha, Shri. G. Venkatraman, Shri. Khairil Anuar Abdullah, Shri. Sanjay

Executive Directors

Nayar and Shri. Vinayak Chatterjee are being recommended for appointment for a term of upto five consecutive years i.e. upto 31st March 2019, on a non-rotational basis.

The Company has gone in for a major re-organisation of its top leadership with the twin objective of accelerating growth and furthering its strategic goals. This strategic re-alignment will enable the company to focus on growth

Business Review

as on 31st March 2013) not claimed by depositors.

Shri. T.K. Balaji has resigned from the office of Director of the Company w.e.f 15th April 2014 citing his inability

opportunities and hospitals, pharmacies and clinics while furthering its clinical leadership and service excellence.

to continue given his other professional commitments.

The Company aims to deepen the focus in each of these verticals as well as drive synergies between them using

The Board wishes to place on record its appreciation for his contributions made during his tenure as a Director

technology and foster an ecosystem focused on wellness, innovation and productivity.

the following Executive Directors along with new designations.

Auditors

Smt.Preetha Reddy has been re-designated as Executive Vice-Chairperson of the Company. She will work

The Auditors, M/s. S. Viswanathan, Chartered ants, retire at the ensuing Annual General Meeting and

closely with the organization’s 8,000 clinicians, industry bodies, State and Central Governments to advance

have confirmed their eligibility and willingness to accept office, if re-appointed.

policy matters on important healthcare issues and also in reviewing global medical advancements, in introducing contemporary protocols to further enhance clinical outcomes. Considering the immense potential in international

The Audit Committee and the Board recommend the re-appointment of M/s.S.Viswanathan, Chartered

business, Smt. Preetha Reddy will directly lead this portfolio and drive Apollo’s aspiration of becoming the global

ants, as Auditors of the Company, to hold office till the conclusion of the next Annual General Meeting.

Standalone Financials

of the Company.

The Board of Directors at its meeting held on 2nd July 2014 approved the expanded roles and responsibilities of

healthcare destination. She will also steer the Enterprise Risk Management portfolio for the company. Smt. Suneeta Reddy assumes the role of Managing Director of the Company. She will lead the initiatives related to

Cost Auditors

corporate strategy, corporate finance, funding and investments and will leverage M&As to achieve the accelerated

The Company has appointed M/s. Raman and Associates, Cost ants, as the Cost Auditors for conducting the audit of cost records of the Company for the financial year ending 31st March 2015.

48

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Consolidated Financials

Annual Report 2013–14

Statutory Section

Directors

for preventing and detecting fraud and other irregularities; •

Corporate Review

The Directors of the Company hereby state and confirm that: •

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | Purchasing Electricity units with wind mill units and compensating with EB bills.

•

Phasing out of CFL Lamps with LED Lights.

•

Introducing Micro processing energy saver for AHU Motors. (ABANCA)

•

Incorporating ZETEON water saving accessories in the hospitals.

Directors’ Report. However, having regard to the provisions of Section 219(1)(b)(iv) of the Companies Act, 1956,

•

Availment of H.T connection for Lab Block from L.T connection to conserve energy consumption.

the Annual Report excluding the aforesaid information is being sent to all the of the Company and others

As energy costs comprise a very small portion of your Company’s total expenses, the financial implications of

entitled thereto. Any interested in obtaining such particulars may write to the Company Secretary at the

these measures are not material.

In of provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, the names and other particulars of employees are set out in the Annexure to the

ed Office of the Company.

Technology Absorption

Particulars Regarding Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo.

Corporate Review

•

Particulars of Employees as per Section 217(2A) of the Companies Act, 1956.

Over the years, your Company has brought into the country the best that the world has to offer in of technology. In its continuous endeavour to serve the patients better and to bring healthcare of international standards within the reach of every individual, your company has introduced the latest technologies in its hospitals.

Particulars as required to be disclosed as per the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are set out in the statement attached herewith as Annexure - A.

1. The latest 3.0 Tesla MRI system from Philips - model Ingenia 3.0T, has been installed at Apollo Hospital, RF coils resulting in 40% higher signal-to-noise ratio and highest dynamic range to provide excellent image

Acknowledgement

quality. Flexstream technology enables imaging with fewer coils and reduces patient set up time thereby

Your Directors wish to place on record their appreciation of the contribution made by the employees at all levels,

increasing patient throughput by 30%. This model has the largest homogenous field of view offering a

to the continued growth and prosperity of your Company.

Statutory Section

Greams Road, Chennai. It incorporates patented stream architecture wherein MR signals are digitised in the

combination of maximum comfort for patient scanning and high image quality. Multi Transmit 4D technology

Your Directors also wish to place on record their appreciation of business constituents, banks and other financial

utilizes multiple RF sources to adapt to individual patients, resulting in better image uniformity, contrast and

institutions and shareholders, of the Company for their continued .

consistency in addition to faster patient scanning. 2. Due to increasing multi-drug resistant infectious organisms, Microbiology labs have a challenge in accurate microbial identification and antibiotic susceptibility testing for achieving better clinical responses and

Place : Chennai Date : 2nd July 2014

efficient patient care outcomes. The VITEK MS is an automated mass spectrometry microbial identification

Dr. Prathap C Reddy

system installed at the Apollo Hospital, Greams Road, Chennai which utilizes the latest technology and

Executive Chairman

a comprehensive database of clinically relevant species for obtaining results in a short time. The system provides a clear identification of the species, genus and family so that clinicians can start appropriate

Business Review

For and on behalf of the Board of Directors

antibiotic treatment at the earliest. The system is equipped with Biomerieux’s advanced middleware solution MYLA for seamless integration of the reports and results with the Hospital Lab Information System.

Annexure - A to the Directors’ Report Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo

3. The INGENUITY TF 128 PET CT at Apollo Gleneagles Hospitals, Kolkata is the first installation of its kind in the world. The system has the latest 3rd generation Time of Flight technology with best timing resolution of at significantly lower doses which helps in reducing the radiation burden on the patient. The sensitivity gain achieved through Astonish TF allows for fewer counts required for measured PET activity. The Astonish TF technology helps in minute lesion detection and providing patient care in oncology investigation and

Conservation of Energy

follow-up studies. The World’s first open gantry design allows the patient to undergo a PET-CT scan with

The operations of the Company are not energy-intensive. However, significant measures are being taken to

maximum comfort especially for claustrophobic and paediatric patients. The Ingenuity TF PET/CT is powered with the fastest 128 slice CT with ultra-fast reconstruction which produces superb image quality. There is

Your Company constantly evaluates and invests in new technology to make its infrastructure more energy efficient.

a 33% improvement in z-axis visualization with 128 slices. The ultra-high resolution of the system allows

The following energy saving measures were adopted during the year 2013-2014.

outstanding spatial visualization. The Ingenuity 128 slice CT offers 4cms coverage for excellent image quality at a low dose with up to 57% improvement in spatial resolution. The iPatient’s holistic approach to workflow

Sustaining the hot water generation for patient rooms with heat pump instated of hot water (Diesel) Boiler

makes the entire procedure of acquiring the scans simpler and easier. The system automatically determines

and energy saving is maintained.

the collimation, pitch and rotation time, always optimizing for image quality, dose and speed.

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Consolidated Financials

Annual Report 2013–14

reduce the energy consumption by using energy-efficient equipment.

•

Standalone Financials

495 pico seconds powered with Astonish TF. The Astonish TF technology gives exceptional image quality

4. Varian True beam STX Linear Accelerator: To advance the treatment of lung, breast, prostate, head and

Corporate Governance Report

neck, and other types of cancers, the TrueBeam™ platform for image-guided radiotherapy and radiosurgery has been ordered for Apollo Specialty Hospital, Chennai to treat even moving targets with unprecedented

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

speed and accuracy. The system dynamically synchronizes imaging, patient positioning, motion management, and treatment delivery. “Intelligent” automation further speeds treatments with an up to five-fold reduction in the number of steps needed for imaging, positioning and treating patients. The system can be used for all

Corporate Review

forms of advanced external-beam radiotherapy including image-guided radiotherapy and radiosurgery (IGRT and IGRS), intensity-modulated radiotherapy (IMRT), stereotactic body radiotherapy (SBRT) and RapidArc® radiotherapy. New ‘gated’ RapidArc Radiotherapy, which compensates for tumor motion by synchronizing

The Company’s philosophy on code of governance

imaging with dose delivery during a continuous rotation around the patient, is a powerful tool for treating cancers of the thorax, such as lung and liver cancers, when tumor motion is an issue.

The basic objective of corporate governance policies adopted by the Company is to attain the highest levels of transparency, ability and integrity. This objective extends not merely to comply with statutory requirements

5. To advance liver disease management, Apollo Hospitals, Chennai is acquiring the latest model Fibroscan

but also to go beyond them by putting into place procedures and systems, which are in accordance with the

502 Touch which provides multiple controls for accurate, reliable and reproducible measurement of liver

best practices of governance. Your Company believes that good Corporate Governance enhances the trust and

tissue stiffness. The system includes a new feature which aids in measurement of ultrasound attenuation in

confidence of all the stakeholders. Good practice in corporate behaviour helps to enhance and maintain public

the liver. This enables non invasive assessment and quantification of liver steatosis for the examination and

Your Company reviews its corporate governance practices to ensure that they reflect the latest developments

6. Intuitive Surgical-da Vinci Robotic Surgical System: With a view to provide the best available surgical

in the corporate arena and in positioning itself to conform to the best corporate governance practices. Your

outcomes to patients, Apollo Group has introduced state-of-the-art da Vinci Robotic surgical system in 4 of its locations in the network. These Systems combine computer and robotic technologies to create a new category

Company is committed to pursuing excellence in all its activities and in maximisation of its shareholders’ wealth.

of surgical treatment, robotic-assisted laparoscopic, thoracoscopic or endoscopic surgery. By providing

The Company’s corporate governance policies and practices focus on the following principles:-

surgeons with enhanced capabilities, the System makes it possible to treat a broader range of conditions

1. To recognize the respective roles and responsibilities of the Board and Management.

using a minimally invasive approach for major surgery with only a few tiny incisions. In addition, the surgeon can operate with better visualization, precision, dexterity and control than possible using traditional surgical

2. To achieve the highest degree of transparency by maintaining a high degree of disclosure levels.

patients than conventional open and minimally invasive surgery allow. The benefits to patients include small

Business Review

approaches. The extended capabilities of the System will help surgeons provide better clinical outcomes to

3. To ensure and maintain high ethical standards in its functioning.

scars, shorter hospital stay, precise, easy and safe access even to difficult-to-reach surgical sites.

4. To accord the highest importance to investor relations.

7. Mazor Robotics’ Renaissance Spine Surgery System: Surgical treatment of the spine requires planning

5. To ensure a sound system of risk management and internal controls.

and precision; and each patient’s anatomy has unique challenges. Surgery with Mazor Robotics’ Renaissance System provides increased safety and precision for a wide variety of spine procedures, and in some cases,

6. To ensure that employees of the Company subscribe to the corporate values and apply them in their conduct.

enables minimally invasive surgery. Surgeons plan before entering the operating room and then implement

7. To ensure that the decision making process is fair and transparent.

with the utmost perfection during the procedure, providing consistent results and optimal outcomes for

8. To ensure that the Company follows globally recognized corporate governance practices.

lowers complication rates, reduces pain and enables faster recovery and return to daily activities. Apollo has been using this one of its kind system as a next step in the evolution of spine surgery in India.

I. Board of Directors

Foreign Exchange Earnings & Outgo

The Company has an Executive Chairman. As per Clause 49 of the Listing Agreement, if the Chairman is

Foreign Exchange Earnings: ` 534.27 million (This is exclusive of rupee payment made by Non-Resident Indians

Standalone Financials

patients minimally invasive surgery with Mazor Robotics’ technology increases accuracy with less radiation,

an Executive Chairman, at least half of the Board should comprise of independent directors. The Board

and Foreign Nationals)

comprises 62 per cent of independent directors. The Board of Directors of the Company has a healthy blend

Foreign Exchange Outgo : ` 1,146.67 million towards purchase of medical equipment and capital expenditure.

of executive and non-executive directors, and consequently ensures the desired level of independence in functioning and decision-making. Moreover all the non-executive directors are eminent professionals, and bring the wealth of their professional expertise and experience to the management of the Company.

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Annual Report 2013–14

Statutory Section

trust in companies and the stock markets.

follow up of patients with liver disease.

Pecuniary relationships or transactions of Non executive directors vis-à-vis the Company

(A) Composition of the Board of Directors and details of external directorships and hips of boards/committees Director

Promoter

Designation

Executive

Share

Number of

Number of

Whether

holding

Directorships

hips

Chairman / Member

(B) Remuneration Policy to Directors

in the

(out of which as

in Board

Company

Chairman) other

Committees

a) Executive Directors

than AHEL #

other than

The Nomination and Remuneration Committee of the Board consists solely of non-executive directors. Its

AHEL ##

of reference include making recommendations to the Board in respect of the Group policy on executive

6,445,464

14(11)

-

remuneration, and the consideration and determination of the remuneration of the executive directors and senior

-

management.

Chairman Smt. Preetha Reddy

Promoter

Executive Vice Chairperson

Smt. Suneeta Reddy Smt. Shobana

Promoter Promoter

Smt. Sangita Reddy

12

1

Member

2,381,590

11(3)

1

Chairman

1

Member

1

Member

The main aim of the Group’s remuneration policy is to pay the Group’s executive directors and senior management

1

Managing Director1 Executive Vice -

2,189,952

13

competitively, having regard to other comparable companies and the need to ensure that they are properly remunerated and motivated to perform in the best interests of shareholders. Performance related rewards, based on measured and stretch targets, are therefore an important component of remuneration packages. The Nomination and Remuneration Committee obtains external advice from independent firms of compensation

Chairperson1 Promoter

t Managing Director

2,432,508

12

-

and benefit consultants when necessary.

-

1

The main components of the remuneration package for executive directors comprises of base salary and

Independent Director

-

-

-

Shri. Rafeeque

Independent Director

55,900

-

-

-

Independent Director

10,806

1

-

-

Independent Director

-

2(1)

2

Chairman

2

Member

performance related variable annual incentive linked to company performance.

Ahamed Shri. Habibullah

Base Compensation (Fixed pay) The base salary or the fixed component has been finalized based on prevailing market standards. The salaries

Badsha Shri. Deepak Vaidya

for executive directors will be reviewed annually having regard to the job size, responsibility levels, performance evaluation and competitive market practices. Also, the annual increments relating to the fixed pay components will be decided by the Nomination and Remuneration Committee based on company performance and market

Independent Director

-

4(1)

4

Chairman

Shri.Khairil Anuar

Independent Director

-

-

-

-

Shri.G.Venkatraman

Independent Director

-

6

5

Chairman

Performance Based Incentive (Variable pay)

Shri. Sanjay Nayar

Independent Director

-

1

2

Chairman

All Executive Directors would be eligible for Performance Based Variable Pay, linked to the achievement of

3

Member

operating profit targets and job related goals. A percentage of the bonus is payable by reference to the profit

Shri. Vinayak

Independent Director

2

Chairman

targets and the balance is payable by reference to individual performance criteria. The maximum annual bonus

2

Member

payable is 125% of base salary.

conditions.

Abdullah

2

Chatterjee

-

3

#excluding Directorships in Foreign Companies, Private Companies and Section 25 Companies.

In addition to the variable pay, the Executive Chairman will be eligible for a commission of upto 1% of the net profits before tax of the Company. This will be determined by the Nomination and Remuneration Committee

## Represents hip/Chairmanship of Audit Committees and Stakeholders Relationship Committee.

based on the review of the Executive Chairman’s achievement linked to improvement in shareholders returns and brand enhancement.

As on 31st March 2014, none of the Directors on the Board hold the office of Director in more than 15 Public Limited Companies, or hip of Committees of the Board in more than 10 Committees and Chairmanship

The Executive Directors Compensation as detailed above is within the overall framework of the approvals given

of more than 5 Committees, across all companies.

by shareholders and in line with the managerial remuneration limits as specified under the Companies Act, 1956.

1 Redesignated w.e.f. 2nd July, 2014

The job related goals for each working director will be set out by the Nomination and Remuneration Committee

2 Appointed as a director w.e.f. 2nd July, 2014

every year.

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Consolidated Financials

Annual Report 2013–14

Standalone Financials

Shri. N. Vaghul

Business Review

Shri. Rajkumar Menon

Statutory Section

Kamineni

2,193,915

Corporate Review

Dr. Prathap C Reddy

Category

The Company does not have any direct pecuniary relationship/transaction with any of its Non Executive Directors.

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | b) Non Executive Directors

Daughter of Dr. Prathap C

Compensation to the non-executive directors takes the form of:-

Smt. Shobana Kamineni

1. Sitting fees for the meetings of the Board and Committees, if any attended by them and

Reddy, Sister of Smt.Preetha Reddy, Smt. Suneeta Reddy

-

27.00

24.11

-

51.11

-

27.00

24.03

-

51.03

& Smt. Sangita Reddy Daughter of Dr. Prathap C

2. Commission on profits.

Executive and Independent Directors within the overall maximum ceiling limit of 1% of the net profits of the

Reddy, Sister of Smt.Preetha Reddy, Smt. Suneeta Reddy & Smt. Shobana Kamineni

Company for a period of five years with effect from 1st April 2009 in addition to the sitting fees being paid by the

Shri. Rajkumar Menon

-

0.18

-

-

1.00

1.18

The compensation is reviewed periodically taking into consideration various factors such as performance of the

Shri. Rafeeque Ahamed

-

0.04

-

-

1.00

1.04

responsibilities cast on the directors under various laws and other relevant factors.

Shri. Habibullah Badsha

-

0.04

-

-

1.00

1.04

The Board approved the payment of commission of ` 1 million to each Non Executive and Independent Director

Shri. Deepak Vaidya

-

0.18

-

-

1.00

1.18

for the year ended 31st March 2014.

Shri. N. Vaghul

-

0.12

-

-

1.00

1.12

Shri. T.K. Balaji

-

0.04

-

-

1.00

1.04

The aggregate commission payable to all non-executive directors is well within the limits approved by the

Shri.Khairil Anuar Abdullah

-

0.08

-

-

1.00

1.08

Company, time spent by the directors for attending to the affairs and business of the Company, and the extent of

shareholders and in line with the provisions of the Companies Act, 1956. (c) Details of remuneration paid to the Directors The details of the remuneration paid/accrued to the Directors for the year ended 31st March 2014 along with their relationships and business interests is detailed below:

Dr. Prathap C Reddy

Father of Smt.Preetha Reddy, Smt.Suneeta Reddy, Smt. Sangita Reddy & Smt. Shobana Kamineni

Remuneration paid/payable for the year ended 31st March 2014 Remuneration Sitting Fee

-

Fixed pay

Commission

Total

59.40

49.30

41.80

150.50

1.22

-

0.04

-

-

0.35

0.39

Shri. Sanjay Nayar (appointed w.e.f 10th February 2014)

-

-

-

-

-

-

The term of executive directors is for a period of 5 years from the respective dates of appointment.

iv. Commission to the Non-Executive Directors for the year ended 31st March 2014 @ ` 1 million each per 27.00

24.11

-

51.11

General Meeting to be held on 25th August 2014. Sitting fee also includes payment of fees for attending Board-level Committee Meetings. v. The Company has no stock option plans and hence, such an instrument does not form part of the remuneration

Standalone Financials

annum will be paid, subject to deduction of tax after adoption of s by shareholders at the Annual -

Daughter of Dr. Prathap C Reddy, Sister of Smt.Preetha

package payable to any Executive Director and/or Non-Executive Director. -

27.00

24.84

-

51.84

vi. The Company did not advance any loan to any of its directors during the year.

Kamineni & Smt.Sangita

Annual Report 2013–14

1.00

iii. None of the above persons is eligible for any severance pay.

Reddy

Reddy, Smt. Shobana

-

ii. The Company does not have any service contract with any of the directors.

Kamineni & Smt.Sangita

Smt. Suneeta Reddy

-

i.

Reddy, Sister of Smt.Suneeta Reddy, Smt. Shobana

0.22

Notes:

Variable Pay

Daughter of Dr. Prathap C Smt. Preetha Reddy

-

Business Review

Relationship with other Directors

Name of the Director

(` in million)

Shri.G.Venkatraman Shri. Shashank Singh (resigned w.e.f 7th August 2013)

Statutory Section

Company for attending the Board/Committee Meetings.

Corporate Review

Smt. Sangita Reddy

The Shareholders and the Ministry of Corporate Affairs have approved the payment of commission to Non

Reddy

57

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Consolidated Financials

56

judgment or order which, may have ed strictures on the code of conduct of the Company or taken

(C) Board Procedures

an adverse view regarding another enterprise that can have negative implications on the Company.

(a) Number of Board Meetings held, dates on which held



10. Details of t venture or collaboration agreements.



Five board meetings were held during the financial year from 1st April 2013 to 31st March 2014. The dates



11. Transactions that involve substantial payment towards goodwill, brand equity or intellectual property.

on which the meetings were held are as follows:-



12. Significant labour problems and their resolutions. Any significant development on the Human Resources/ Industrial Relations front like g of wage agreement, implementation of VRS scheme etc.

26th April 2013, 20th May 2013, 7th August 2013, 12th November 2013 and 10th February 2014.

Director

Number of

Board Meetings Board Meetings

13. Sale of material nature such as investments, subsidiaries, assets which is not in the normal course of



14. Quarterly details of foreign exchange exposures and the steps taken by management to limit the risks

business.

(b) Attendance details of each director at the Board Meetings and at the last AGM are set out below:-

Number of



Last AGM

of adverse exchange rate movement, if material.

attendance



15. Non-compliance of any regulatory, statutory or listing requirements and shareholders service such as

held

Attended

(Yes/No)

Dr. Prathap C Reddy

5

5

Yes

Smt. Preetha Reddy

5

5

Yes

d) The Board reviews periodically the compliance reports of all laws applicable to the Company.

Smt. Suneeta Reddy

5

5

Yes

Smt. Shobana Kamineni

5

4

Yes

(D) Code of Conduct for Board and Senior Management Personnel

Smt. Sangita Reddy

5

5

Yes

Shri. Rajkumar Menon

5

3

No

with the legal requirements, specifically under Clause 49 of the Stock Exchange Listing Agreements of the

Shri. Rafeeque Ahamed

5

2

No

Company. The Code is aimed at preventing any wrongdoing and promoting ethical conduct at the Board and

Shri. Habibullah Badsha

5

2

No

Senior Management level.

Shri. Deepak Vaidya

5

4

Yes

The Company Secretary has been appointed as the Compliance Officer and is responsible to ensure

Shri. N. Vaghul

5

5

Yes

adherence to the Code by all concerned. A copy of the code of conduct has been posted at the Company’s

5

2

No

official website www.apollohospitals.com

Shri. Khairil Anuar Abdullah

5

4

Yes

The declaration regarding compliance with the code of conduct as required under clause 49 of the Listing

Shri. G. Venkatraman

5

5

Yes

Agreement with the stock exchanges is appended to this report.

Shri. Shashank Singh

5

1

-

Shri. Sanjay Nair

5

-

NA

The Board of Directors have adopted a Code of Conduct for the Board and Senior Management Personnel. This Code helps the Company to maintain the Standard of Business Ethics and ensure compliance



Code of Conduct for prevention of Insider Trading The Company has adopted a code of conduct for prevention of insider trading in accordance with the

1 Ceased to be a Director w.e.f 25th April 2014

Business Review

2

non¬payment of dividend, delay in share transfers etc.

Statutory Section

Shri. T.K. Balaji

1

Corporate Review



Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992. Shri. S.M. Krishnan,

2 Appointed to the Board w.e.f 10th Feb 2014

Senior General Manager - Finance and Company Secretary is the Compliance Officer. All the Directors and Senior Management Personnel and such other designated employees of the Company who are expected to

(c) The information made available to the Board includes the following

have access to unpublished price sensitive information relating to the Company are covered under the said

1. Annual Operating plans, budgets and any updates.

code. The Directors, their relatives, senior management personnel, designated employees etc., are restricted



2. Capital budgets and any updates.

from purchasing, selling and dealing in the shares while being in possession of unpublished price sensitive



3. Quarterly results for the Company and its operating divisions or business segments.

information about the Company during certain prohibited periods.



4. Minutes of meetings of the Audit Committee and other committees of the Board.



5. The information or recruitment and remuneration of senior officers just below the board level, including

Standalone Financials





6. Show cause, demand, prosecution notices and penalty notices, which are materially important.



7. Fatal or serious accidents, dangerous occurrences any material effluent or pollution problems.



8. Any material default in financial obligations to and by the Company or substantial non-payment for goods sold by the Company.



9. Any issue which involves possible public or product liability, claims of substantial nature including any

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Annual Report 2013–14

appointment and removal of the Chief Financial Officer and the Company Secretary.

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | (c) Powers of the Audit Committee

II. Composition of Board Committees Audit Committee

Stakeholders

Nomination &

Relationship

Remuneration

Committee

Committee

Investment

Share Transfer

Committee

Committee

Corporate Social Responsbility

Shri. N.Vaghul, Member

Shri. N. Vaghul, Member

Shri. Rajkumar Menon, Member

Shri.G.Venkatraman, Member

Smt. Preetha Reddy, Member

Shri. Deepak Vaidya Member

Shri. Deepak Vaidya, Member

Shri. Rafeeque Smt.Suneeta Ahamed, Member Reddy, Member

Shri. Rafeeque Ahamed, Member



1. To investigate any activity within its of reference.

Shri. Rafeeque Ahamed, Chairman



2. To seek information from any employee.



3. To obtain outside legal or other professional advice.



4. To secure attendance of outsiders with relevant expertise, if it considers necessary

Corporate Review

Shri. Rajkumar Menon, Chairman

Smt. Preetha Reddy, Smt. Preetha Member Reddy, Member

The powers of the Audit Committee include the following:

Committee

Shri. Deepak Vaidya, Chairman

Shri.Rajkumar Menon, Smt. Suneeta Reddy, Shri.G.Venkatraman Member Member Member



(d) Functions of the Audit Committee

Smt. Sangita Reddy, Member

Smt.Suneeta Reddy, Member



The role of the Audit Committee includes the following:



1. Oversight of the company’s financial reporting process and the disclosure of its financial information to ensure that the financial statements are correct, sufficient and credible;

Shri. Vinayak Chatterjee, Member2



2. Recommendation for appointment, remuneration and of appointment of auditors of the company;



3. Approval of payments to statutory auditors for any other services rendered by the statutory auditors;



4. Reviewing, with the management, the annual financial statements and auditor’s report thereon before

1 Ceased to be a member w.e.f 25th April 2014

Statutory Section

Shri. T.K. Balaji1, Member

submission to the Board for approval, with particular reference to:

2 Appointed as a member w.e.f 2nd July 2014



report in of clause (c) of sub-section (2AA) of section 217 of the Companies Act, 1956

1. Audit Committee

The Company continued to derive immense benefit from the deliberations of the Audit Committee comprising of the following Independent Directors.



1. Shri. Deepak Vaidya, Chairman



2. Shri. G. Venkatraman and



3. Shri. Rajkumar Menon

The committee comprises of eminent professionals with expert knowledge in corporate finance. The Minutes of

b. Changes, if any, in ing policies and practices and reasons for the same



c. Major ing entries involving estimates based on the exercise of judgment by management



d. Significant adjustments made in the financial statements arising out of audit findings



e. Compliance with listing and other legal requirements relating to financial statements



f. Disclosure of any related party transactions



g. Qualifications in the draft audit report



approval;

(b) Meetings of Audit Committee

The Audit Committee met five times during the year on 25th April 2013, 16th May 2013, 6th August 2013,

Designation

1.

Shri. Deepak Vaidya

2. 3.

those stated in the offer document / prospectus / notice and the report submitted by the monitoring Number of Meetings Held

Number of Meetings attended

Chairman

5

5

Shri. G. Venkatraman

Member

5

5

Shri. Rajkumar Menon

Member

5

3

agency monitoring the utilisation of proceeds of a public or rights issue, and making appropriate recommendations to the Board to take up steps in this matter;

7. Reviewing and monitoring the auditor’s independence and performance, and effectiveness of the audit process;



60

8. Approval or any subsequent modification of transactions of the Company with related parties;

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Consolidated Financials

Sl. No Name of the Member

6. Reviewing, with the management, the statement of uses / application of funds raised through an issue (public issue, rights issue, preferential issue, etc.), the statement of funds utilized for purposes other than

11th November 2013 and 10th February 2014.

Annual Report 2013–14

5. Reviewing, with the management, the quarterly financial statements before submission to the Board for

Standalone Financials

each audit committee meeting are placed before and discussed by the Board of Directors of the Company.



Business Review

(a) Composition of the Audit Committee

a. Matters required to be included in the Director’s Responsibility Statement to be included in the Board’s

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

9. Scrutiny of inter-corporate loans and investments;

2. Nomination & Remuneration Committee



10. Valuation of undertakings or assets of the company, wherever it is necessary;

(a) Composition and Scope of the Nomination & Remuneration Committee



11. Evaluation of internal financial controls and risk management systems;



12. Reviewing, with the management, performance of statutory and internal auditors, adequacy of the

In line with the requirements of the Companies Act, 2013, the Board at its meeting held on 25th April 2014 changed the nomenclature of the existing Remuneration and Nomination Committee as the Nomination and Remuneration Committee.



The Nomination & Remuneration Committee comprises of the following Non Executive and Independent Directors.

13. Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure coverage

1. Shri. N. Vaghul

and frequency of internal audit;

2. Shri. Deepak Vaidya



14. Discussion with internal auditors of any significant findings and follow up there on;



15. Reviewing the findings of any internal investigations by the internal auditors into matters where there is

Corporate Review

internal control systems;

3. Shri. G. Venkatraman and 4. Shri. Rafeeque Ahamed The Scope of the Nomination & Remuneration Committee includes the following:

suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting

1. To submit recommendations to the Board with regard to -

the matter to the Board;

16. Discussion with statutory auditors before the audit commences, about the nature and scope of audit as

Non-Executive Directors. In making these recommendations, the Committee shall take into

well as post-audit discussion to ascertain any area of concern;

the special professional skills required for efficient discharge of the Board’s functions;

17. To look into the reasons for substantial defaults if any, in the payment to the depositors, debenture holders, shareholders (in case of non-payment of declared dividends) and creditors;



18. To review the functioning of the Whistle Blower mechanism;



19. Approval of appointment of the CFO (i.e., the whole-time Finance Director or any other person heading

21. Carrying out such other functions as may be specifically referred to the committee by the company’s

c) Appointment of Executive Directors.



(b) the amount of remuneration, including performance or achievement bonus and perquisites payable to the Executive Directors



3. To frame guidelines for Reward Management and recommend suitable schemes for the Executive Directors and Senior Management

The Audit Committee shall mandatorily review the following information. (i) The Management Discussion and Analysis of financial condition and results of operations;



4. To determine the need for key man insurance for any of the company’s personnel



(ii) Statement of significant related party transactions (as defined by the Audit Committee and submitted



5. To identify persons who are qualified to become directors and who may be appointed in senior management positions in accordance with the criteria laid down and recommend to the Board their



(iii) Management letters / letters of internal control weaknesses issued by the Statutory Auditors;



(iv) Internal audit reports relating to internal control weaknesses; and



(v) The appointment/removal and of remuneration of the Internal Auditors/Chief Internal Auditor



appointment and removal

6. To carry out evaluation of every Director’s performance.



7. To formulate the criteria for determining the qualification, positive attributes and independence of

Standalone Financials



by management);

a director and recommend to the Board a policy, relating to the remuneration for the directors, key managerial personnel and other employees.

In addition to the areas noted above, the audit committee reviews controls and security relating to the Company’s critical IT applications, the internal and control assurance audit reports of all major divisions and profit centers and deviations from the code of business principle, if any.

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Annual Report 2013–14

(a) the amount of commission and fees payable to the Directors within the applicable provisions of the Companies Act, 1956.

Board of Directors and/or other committees of Directors.



Business Review



b) Retirement of Directors liable to retire by rotation; and



background, etc. of the candidate; 20. Carrying out any other function as is mentioned in the of reference of the Audit Committee.



2. To determine and recommend to the Board from time to time -

the finance function or discharging that function) after assessing the qualifications, experience and



a) Filling up of vacancies in the Board that might occur from time to time and appointment of additional

Statutory Section



Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

8, To formulate the criteria for evaluation of Indpendent Directors and the Board.



9. To ensure that the level and composition of remuneration is reasonable and sufficient, relationship of remuneration to performance is clear and meets performance benchmarks, and involves a balance



2. Smt. Preetha Reddy and



3. Smt. Suneeta Reddy



The Stakeholders Relationship Committee specifically looks into issues such as redressing of shareholders’ and investors’ complaints such as transfer of shares, non-receipt of shares, non-receipt of declared dividends

between fixed and incentive pay.

and ensuring expeditious share transfers and also redresses the grievances of deposit holders, debenture

10. To carry out any other function as is mandated by the Board from time to time and/or enforced by any

holders and other security holders. (b) Meetings of the Stakeholders Relationship Committee

(b) Meetings of the Nomination & Remuneration Committee

The Committee met four times during the year on 5th April 2013, 9th July 2013, 11th October 2013 and 10th January 2014.

During the year, the Nomination & Remuneration Committee met on 20th May 2013. Sl. No

Name of the Member

Designation

Number of Meetings Held

Number of Meetings attended

Sl. No

Name of the Member

Designation

Number of Meetings Held

Number of Meetings attended

Shri. N. Vaghul

Chairman

1

1

1.

Shri. Rajkumar Menon

Chairman

4

4

2.

Shri. Deepak Vaidya

Member

1

-

2.

Smt. Preetha Reddy

Member

4

4

3.

Shri. G. Venkatraman

Member

1

1

3.

Smt. Suneeta Reddy

Member

4

4

4.

Shri. Shashank Singh (ceased to be a member w.e.f 7th August 2013)

Member

1

1

6.

Shri. Rafeeque Ahamed

Member

1

-

Statutory Section

1.

Corporate Review

statutory notification, amendment or modification as may be applicable.

Name and designation of the Compliance Officer:Shri. S.M. Krishnan, Sr. General Manager – Finance and Company Secretary.

3. Investment Committee (5) Corporate Social Responsibility Committee

(a) Composition and Scope of the Investment Committee

As per the Companies Act, 2013, all companies having a networth of ` 5,000 million or more, or turnover

The Investment Committee comprises of a majority of Independent Directors and consists of the following

of ` 10,000 million or more or a net profit of ` 50 million or more during any financial year will be required

. 1. Shri. N. Vaghul



2. Shri. Deepak Vaidya



3. Shri. Vinayak Chatterjee (Appointed as a member w.e.f. 2nd July 2014)



4. Smt. Preetha Reddy and



5. Smt. Suneeta Reddy



Note: Shri. T.K. Balaji ceased to be a member w.e.f. 25th April 2014

to constitute a Corporate Social Responsibility (CSR) Committee of the Board consisting of three or more directors, at least one of whom will be an independent director. Accordingly, the Board on April 25, 2014 constituted the CSR Committee (‘the Committee’) comprising of :

1. Shri. Rafeeque Ahamed, Chairman



2. Smt. Suneeta Reddy and



3. Smt. Sangita Reddy



The purpose of the Committee is to formulate and monitor the CSR policy of the Company. The of

the Company.



4. Stakeholders Relationship Committee

by the company as well as the amount of expenditure to be incurred on the activities referred to in the



CSR policy.

In line with the requirements of the Companies Act, 2013, the Board at its meeting held on 25th April 2014 changed the nomenclature of the existing Investors Grievance Committee as the Stakeholders Relationship Committee.



• To monitor the CSR policy from time to time.



• To prepare a transparent monitoring mechanism for ensuring implementation of the projects / programmes / activities proposed to be undertaken by the Company.

(a) Composition and Scope of the Stakeholders Relationship Committee The Stakeholders Relationship Committee comprises of the following Directors:



• To report, in the prescribed format, the details of their CSR initiatives in the Directors’ Report and in the Company’s website.

1. Shri. Rajkumar Menon, Chairman

64

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Consolidated Financials

Annual Report 2013–14

• To formulate and recommend to the board, a CSR policy, which will indicate the activities to be undertaken

Standalone Financials

reference of the Committee will include the following:-

The function of the Investment Committee is to review and recommend investments in new activities planned by

Business Review



(6) Share Transfer Committee

Board has constituted a Risk Management Committee headed by the Managing Director which reviews the



Composition and Scope of the Share Transfer Committee

suitable measures to mitigate such risks.



The Share transfer committee comprises of the following directors:



1. Shri. Rajkumar Menon



2. Smt. Preetha Reddy and



3. Shri. Rafeeque Ahamed



The Share Transfer Committee, constituted by the Board has been delegated powers to ister the

probability of risk events that adversely affect the operations and profitability of the Company and suggests

A Risk Management Framework is already in place and the Executive Management reports to the Board periodically on the assessment and minimization of risks.

Corporate Review

(D) Proceeds of Public, Rights and Preferential Issues

During the year, the Company had not issued or allotted any securities.

following:-

(E) Management



•

To effect transfer of shares





•

To effect transmission of shares



•

To issue duplicate share certificates as and when required; and



•

To confirm demat/remat requests

The Management Discussion and Analysis Report is appended to this report.

(F) Shareholders (1) Disclosures regarding appointment or re-appointment of Directors

As per the Companies Act, 1956, atleast two thirds of the Board should consist of retiring Directors, of these atleast one third are required to retire every year.

Iii. Subsidiaries



Except the Chairman, Managing Director and Non Executive Independent Directors, other Directors are liable

Statutory Section



The Committee, attends to share transfers and other formalities once in a fortnight

to retire by rotation as per the provisions of the Companies Act.

As per the revised Clause 49 of the Stock Exchange Listing Agreement, your Company does not have any Material non-listed Subsidiary Company whose turnover or networth exceeded 20% of the consolidated turnover



or networth respectively of the Company and its subsidiaries in the immediately preceding ing year.

Smt. Sangita Reddy retires by rotation and is eligible for re-appointment at the ensuing Annual General Meeting. Shri. Sanjay Nayar was appointed as an additional director of the Company w.e.f 10th February 2014 and holds the office of Director upto the ensuing Annual General Meeting.

(A) Related Party Transactions



Shri. Vinayak Chatterjee was appointed as an additional Director of the Company w.e.f. 2nd July 2014 and holds the office of Director upto the ensuing Annual General Meeting.

There were no materially significant related party transactions, pecuniary transactions or relationships between the Company and its directors, promoters or the management that may have a potential conflict with the interests



of the Company at large except the details of transactions disclosed in the Notes forming part of the s

Business Review



IV. Disclosures

In order to comply with the requirements of sections, 149, 152 and other applicable provisions of the Companes Act, 2013, the Indpendent Directors Viz, Shri. N. Vaghul, Shri Deepak Vaidya, Shri. Rafeeque

as required under ing Standard 18 of the Institute of Chartered ants of India. All related party

Ahamed, Shri. Rajkumar Menon, Shri. Habibullah Badsha, Shri. G. Venkatraman, Shri. Khairil Anur Abdullah,

transactions are conducted on an arms length basis.

Shri Sanjay Nayar and Shri Vinayak Chatterjee are being recommended for appointment for a term upto five

provided to the Board and the interested Directors neither participate in the discussions, nor do they vote on such matters. The Audit Committee of the Company also reviews related party transactions periodically. (B) ing Treatment



The detailed resumes of all these directors are provided as part of the Notice of the Annual General Meeting.



(2) Means of Communication

Standalone Financials

consecutive years i.e. upto 31st March 2019, on a non-rotational basis.

All details relating to financial and commercial transactions, where directors may have a potential interest are

The unaudited quarterly/half yearly financial statements are announced within forty five days from the

The Company follows the ing Standards issued by the Institute of Chartered ants of India and in

end of the quarter. The aforesaid financial statements are taken on record by the Board of Directors and

preparation of financial statements, the Company has not adopted a treatment different from that prescribed by

are communicated to the Stock Exchanges where the Company’s securities are listed. Once the Stock

any ing Standard.

Exchanges have been intimated, these results are communicated by way of a Press Release to various new agencies/analysts and published within 48 hours in two leading daily newspapers - one in English and one

(C) Risk Management

in Tamil.

Business Risk Evaluation and management of such risks is an ongoing process within the organization. The

66

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Consolidated Financials

Annual Report 2013–14

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

The audited annual results are announced within two months from the end of the last quarter as stipulated



under the Listing Agreement with the Stock Exchanges. For the financial year ended 31st March 2014,

(5) General Body Meetings

The location, date and time of the Annual General Meetings held during the preceding three years are given

the audited annual results were announced on 28th May 2014. The audited annual results are taken on

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

below:

record by the Board of Directors and are communicated to the Stock Exchanges where these results are Year

communicated by way of a Press Release to various news agencies/analysts and are also published within

Date

Venue

Time

48 hours in two leading daily newspapers - one in English and one in Tamil. The audited financial results form

The Company also informs by way of intimation to the Stock Exchanges all price sensitive matters or such

January 2010-2011 22, 2011 (EGM)

other matters which in its opinion are material and of relevance to the shareholders. The quarterly/half yearly and the annual results of the company are put on the Company’s website www.apollohospitals.com.

Chinmaya Heritage Centre, 11.00 A.M. Tapovan Hall, Chennai

Reminder to Investors: Reminders for unclaimed shares, unclaimed dividend/interest are sent to the shareholders as per records every year.

Kamaraj Arangam, Chennai

9th 2011-2012 August 2012

Kamaraj Arangam, Chennai

7th 2012-2013 August 2013

The Music Academy, Chennai

by NSE for corporates. All periodical compliance filings like shareholding pattern, corporate governance report are filed electronically on NEAPS.

BSE Corporate Compliance & Listing Centre (the listing centre): BSE’s listing centre is a web-based

SEBI Complaints Redressal System (SCORES) : The investor complaints are processed in a centralized web based complaints redressal system. The salient features of this system are : Centralised database of all

No Special resolutions were ed.

11.00 A.M.

Payment of remuneration equivalent to 5% of the net profits of the Company to Dr. Prathap C Reddy, Permanent Chairman for a period of five years with effect from 25th June 2012

11.00 A.M.



• Appointment of Smt.Sindoori Reddy as Vice President Operations under the provisions of Section 314 of the Companies Act, 1956 • Alteration of Articles of Association of the Company

(6) Postal Ballots

During the year there were no ordinary or special resolutions ed by the through Postal

Ballot.

(3) Investors' Grievances and Share Transfer

As mentioned earlier, the Company has a Board-level Stakeholders Relationship Committee to examine and redress shareholders and investors’ complaints. The status on complaints and share transfers is reported

V. C EO/CFO Certification

to the Committee. The details of shares transferred and nature of complaints is provided in the Additional

As required by Clause 49 of the Listing Agreement, the certificate from Smt. Preetha Reddy, Managing

information to shareholders section of the Annual Report.

Director and Smt. Suneeta Reddy, t Managing Director was obtained and placed before the Board of

etc., shareholders should send in their communications to Integrated Enterprises (India) Ltd, our registrar

VI. Compliance with Corporate Governance Norms

and share transfer agent. Their address is given in the section on Shareholder Information.

(i) Mandatory Requirements

(4) Details of Non-Compliances

The Company has complied with all the mandatory requirements of Corporate Governance norms as

There are no non-compliances by the Company and no penalties or strictures have imposed on the Company

enumerated in Clause 49 of the Listing Agreement with the Stock Exchanges.

by the Stock Exchanges or SEBI or any statutory authority, on any matter related to capital markets, during the last three years.

(ii) Non-Mandatory Requirements The status of compliance in respect of non-mandatory requirements of Clause 49 of Listing Agreement is as follows:-

68

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4

Consolidated Financials

Annual Report 2013–14

Standalone Financials

Directors at their meeting held on 28th May 2014.

For matters regarding shares transferred in physical form, share certificates, dividends, change of address



Business Review

complaints, online of Action Taken Reports (ATRs) by the concerned companies and online viewing by investors of action taken on the complaint and its current status.

• Issue of upto 3,276,922 convertible warrants to Dr. Prathap C Reddy, Promoter of the Company on a preferential allotment basis

10.15 A.M.

application designed for corporates. All periodical compliance filings like shareholding pattern, corporate governance report are also filed electronically on the listing centre.

• Raising funds by way of equity through Qualified Institutional Placement (QIP) Scheme.

Statutory Section

NSE Electronic Application Processing System (NEAPS) : The NEAPS is a web based application designed

July 22, 2010-2011 2011

• Increasing the Authorized Share Capital of the Company from ` 850 million to ` 1,100 million and consequential amendments to the Memorandum and Articles of Association of the Company.

Corporate Review

a part of the Annual Report which is sent to the shareholders prior to the Annual General Meeting.

Special Resolutions ed

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | 1. The Board

(2) GDRs

There is no Non-Executive Chairman for the Company

Traded at :Nasdaq – Portal Market

2. Shareholder Rights :

(3) Non Convertible Debentures

Details are given under the heading ‘Communication to Shareholders’

Mumbai – 400 051 Website : www.nseindia.com (4) Listing Fees (vi) Address of ed Office

The Company has appointed separate persons for the office of Chairman and Managing Director

No. 19 Bishop Gardens, Raja Annamalaipuram, Chennai – 600 028.

5. Reporting of Internal Auditor :

Paid for all the above stock exchanges for 2013-2014 and 2014-2015.

Corporate Review

Tel : 91-22-2659 8100 - 8114 Fax : 91-22-2659 8237/38

During the year under review, there was no audit qualification in the Company’s financial statements.

4. Separate post of Chairman and CEO :

WDM Segment of National Stock Exchange of India Exchange Plaza, Bandra-Kurla Complex, Bandra (E),

3. Audit Qualifications :

EuroMTF of Luxembourg Stock Exchange, BP 165 L-2011 Luxembourg

(vii) a) Stock Exchange Security

The Company has Internal Auditors who report directly to the Audit Committee.

Code for The Company is in the process of adopting the non-mandatory requirements such as training of board

(1) Equity Shares (i) Bombay Stock Exchange

the Company has fully complied with SEBI guidelines relating to Corporate Governance in respect of

Statutory Section

, mechanism for evaluating the non-executive board and whistle blower policy. However

(i) 508869

Limited, Mumbai

compliance of mandatory requirements applicable as on 31st March 2014.

(ii) National Stock Exchange of

(ii) APOLLOHOSP

India Limited, Mumbai

VII. Auditors Report on Corporate Governance

(2) GDRs

As required by Clause 49 of the Listing Agreement, the auditors’ certificate is given as an annexure to the Directors Report.

India Limited, Mumbai b) Demat ISIN Numbers in NSDL & c) ISIN Numbers of GDRs

1st Quarter

1st April to 30th June

2nd Quarter

1st July to 30th September

3rd Quarter

1st October to 31st December

4th & last Quarter

1st January to 31st March



INE437A01024



f) Domestic Custodian for GDRs

(i) Bombay Stock Exchange Ltd (BSE)



Phiroze Jheejheebhoy Towers, Dalal Street, Mumbai – 400 001 Tel :91-22-2272 1234, 1233, Fax : 91-22-2272 3353/3355 Website : www.bseindia.com

INE437A07062, INE437A07070 INE437A07088 & INE437A07096

e) Overseas Depositary for GDRs

On or before 8th September 2014

– US0376082055

The Bank of New York Mellon 101 Barclay Street, 22W, New York, NY 10286 ICICI Bank Limited Securities Markets Services, 1st Floor, Empire Complex,



414 Senapati Bapat Marg, Lower Parel, Mumbai – 400 013



Tel. +91-22-6667 2026 Fax +91-22-6667 2779/2740 g) Trustee for Debenture Holders

(ii) National Stock Exchange of India Limited (NSE)

Standalone Financials

19th August 2014 to 25th August 2014 (both days inclusive)

Reg. S GDRs

Rule 144a GDRs – US0376081065 d) ISIN Numbers of Debentures

(v) Listing of :

Axis Trustee Services Limited

Exchange Plaza, Bandra-Kurla Complex,



2nd floor, Axis Bank Building, Bombay Dyeing,

Bandra (E), Mumbai – 400 051



Pandurang Bhudkar Marg, Worli, Mumbai - 400 025

Tel : 91-22-2659 8100 - 8114 Fax : 91-22-2659 8237/38



Tel. +91-22- 24255212 Fax +91-22-6667 2779/2740

Website : www.nseindia.com

70

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4

Consolidated Financials

Annual Report 2013–14

APOL17, APOL20, APOL21

CDSL for Equity Shares

(ii) Financial Calendar

(1) Equity Shares

AHELYP05

Business Review

25th August 2014 at 10.30 a.m. T.T.K. Road, Chennai – 600 014

(iv) Dividend Payment

(ii) Nasdaq – Portal Market (i) National Stock Exchange of The Music Academy, New No. 168 (Old No.306)

(iii) Date of Book Closure

US0376082055

(3) Non Convertible Debentures

General Shareholders' information (i) AGM date, time and venue

(i) Luxembourg Stock Exchange

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

viii. Monthly High and Low quotations along with the volume of shares traded in NSE & BSE during the year 2013-2014 Month

National Stock Exchange (NSE) High

Low

High

Numbers

Low

Volume

810.50

2,562,236

849.55

814.00

1,657,924

May-2013

1,097.85

819.55

17,221,948

1,096.15

820.60

1,734,864

Jun-2013

1,071.20

910.00

6,261,369

1,050.00

905.00

717,038

Jul-2013

1,054.00

927.15

4,710,079

1,052.00

928.60

343,828

Aug-2013

990.00

801.20

4,405,872

990.00

802.00

447,936

Sep-2013

949.00

845.00

3,968,747

949.55

842.00

277,344

Oct-2013

935.00

848.70

2,575,066

960.00

850.50

238,138

Nov-2013

927.00

830.05

2,277,556

925.00

824.30

215,440

Dec-2013

961.70

815.35

5,646,705

960.50

817.00

414,598

Jan-2014

987.65

876.05

3,073,072

987.00

879.80

348,901

Feb-2014

969.80

895.70

2,269,710

968.90

899.30

256,876

Mar-2014

925.00

852.10

2,572,021

925.00

852.50

168,601

“Kences Towers”, II Floor, No.1 Ramakrishna Street, North Usman Road, T. Nagar, Chennai – 600 017



Tel. No.: 044 – 2814 0801, 2814 0803 Fax No.: 044 – 2814 2479 E-mail: [email protected]

Share transfer requests for shares held in physical form received by the Company are processed and the share certificates are returned within the stipulated time under the Companies Act and the listing agreement, provided that the documents received are in order and complete in all respects. Delays beyond the stipulated period were mainly due to disputes over the title to the shares.

The shares transferred (in physical form) during the year are as under.

Shares Transferred Total No. of Shares as on 31st March % of Share Capital

2013-2014

2012-2013

(face value of ` 5/-)

(face value of ` 5/-)

83,898

20,874

139,125,159

139,125,159

0.06

0.02

The Company obtains from a Company Secretary in Practice a half-yearly certificate of compliance with the share transfer formalities as required under Clause 47(c) of the Listing Agreement with Stock Exchanges and

Apollo

6800



2. Shareholders’ Services

6700



The status on the total number of requests / complaints received during the year was as follows:

6600 6500

Sl. No.

Received

Replied

6400

1.

Change of Address

200

200

-

6300

2.

Revalidation and issue of duplicate dividend

177

177

-

6200 6100

warrants Share transfers

148

148

-

4.

Split of Shares

11

11

-

5800

5.

Stop Transfers

5700

6.

Change of Bank Mandate

5600

7.

Correction of Name

5500

8.

Dematerialisation Confirmation

5400

9.

Rematerialisation of shares

5300

10.

Issue of duplicate share certificates

19

19

11.

Transmission of shares

100

100

-

12.

General enquiry

210

210

-

6000 5900

Mar-14

Feb-14

Jan-14

Dec-13

Nov-13

Oct-13

Sep-13

Aug-13

Jul-13

Jun-13

May-13

Apr-13

5200

0

0

135

135

-

3

3

-

413

413

-

6

6

-

The Company usually attended to the investor grievances/correspondence within a period of 2 days from the

Month Apollo

date of receipt of the same during the financial year, except in cases that were constrained by disputes and

Nifty

legal impediments.

72

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Consolidated Financials

Annual Report 2013–14

Pending

3.

Nifty

Nifty

Nature of Complaints/Requests

Standalone Financials

1150 1100 1050 1000 950 900 850 800 750 700 650 600 550 500 450 400 350 300 250 200 150 100 50 0

files a copy of the certificate with the Stock Exchanges.

Business Review

Apollo Price

Apollo Price Vs NSE Nifty ix. Apollo Share Price Vs Nifty

Statutory Section

850.00

Integrated Enterprises (India) Limited



xi 1. Share Transfer System

Numbers

(`)



Corporate Review

Apr-2013

The Bombay Stock Exchange, (BSE)

Volume

(`)

x. R egistrar & Share Transfer Agent

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | 3) Legal Proceedings



There are four pending cases relating to dispute over the title to shares, in which Company had been made

2) Categories of shareholders as on March 31, 2014 Category

a party. However these cases are not material in nature.

Category of Shareholder

code

No. of Shaerholders

Total number of shares

Percentage to total no. of shares

4) Change of Address, Bank Details, Nomination etc. All the are requested to notify immediately any changes in their address, email id, bank mandate Limited. holding shares in electronic segment are requested to notify the change of address, email

Shareholding of Promoter and Promoter Group Indian

(a) (b)

Individuals/ Hindu Undivided Family Bodies Corporate Sub Total (A) (1) Total Shareholding of Promoter and Promoter Group Public shareholding

id, bank details, nomination etc to the depository participants (DP) with whom they maintain client s for effecting necessary corrections. Any intimation made to the Registrar without effecting the necessary (B)

changes to their DPs with whom they have opened s.

1 (a) (b) (c) (d) (e)

5) Transfer of unclaimed amounts to the Investor Education and Protection Fund During the year, the Company has transferred a sum of ` 1.97 million as unclaimed dividend to the Investor Education and Protection Fund pursuant to Section 205C of the Companies Act, 1956 and the Investor Education and Protection Fund (Awareness and Protection of Investor) Rules, 2001.

B2 (a) (b)

xii 1) Distribution of Shareholdings as on 31st March 2014 Shares

i. Individual shareholders holding nominal share

Holders

capital up to Rs 1 lakh ii. Individual shareholders holding nominal

No. of Equity Shares Physical Nos. 500

501 1,001

%

Nos.

Physical %

Nos.

Electronic %

Nos.

%

14.77 19.58 34.35 34.35

28 12 1 5 333 379

1,265,286 10,850 323,708 3,712,201 57,803,321 63,115,366

0.91 0.01 0.23 2.67 41.55 45.37

604

1,326,577

0.95

33,378

6,870,788

4.94

10

294,918

0.21

14

120,470

0.09

6

91,606

0.07

share capital in excess of Rs. 1 lakh. ( c)

Any Other

1,146,141

0.82

1,881,785

1.35

7,700

21.25

25,033

69.08

1,000

475,934

0.34

778,051

0.56

628

1.73

1,017

2.81

2,000

515,260

0.37

722,152

0.52

304

0.84

460

1.27

Foreign Nationals Non Resident Indians

Trusts Directors and their relatives

1

300

-

1,144

1,701,572

1.22

1

16,199

0.01

Clearing Member

198

201,092

0.14

Hindu Undivided Families

467

131,198

0.09

3,000

330,858

0.24

388,391

0.28

124

0.34

153

0.42

3,001

4,000

352,144

0.25

332,416

0.24

99

0.27

92

0.25

4,001

5,000

79,454

0.06

199,575

0.14

17

0.05

43

0.12

5,001

10,000

787,815

0.57

887,880

0.64

99

0.27

123

0.34

Foreign Corporate Bodies

4

16,405,575

11.80

Sub-Total (B)(2)

35,827

27,160,295

19.52

Total Public Shareholding (B)= (B)(1)+(B)(2)

36,206

90,275,661

64.89

TOTAL (A)+(B)

36,236

138,064,115

99.24

Nil

Nil

Nil

(2) Public

2

1,061,044

0.76

Total Public Shareholding (C)= (C)(1)+(C)(2)

2

1,061,044

0.76

36,238

139,125,159

100.00

10,001

above

Total Grand Total

523,079

0.38 129,724,224

93.24

22

0.06

324

0.89

4,210,685

3.03 134,914,474

96.97

8,993

24.82

27,245

75.18

139,125,159

Overseas Corporate Bodies

(B)

36,238

(C)

Global Depository Receipts (GDRs) (1) Promoter and Promoter Group

(C)

74

75

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Consolidated Financials

Annual Report 2013–14

GRAND TOTAL (A)+(B)+(C)

Standalone Financials

2,001

Business Review

1

Electronic

Institutions Mutual Funds/ UTI Financial Institutions / Banks Central Government/ State Government(s) Insurance Companies Foreign Institutional Investors Sub-Total (B) (1) Non-institutions Bodies Corporate Individuals

20,550,530 27,237,924 47,788,454 47,788,454

Statutory Section

correction with the DP cannot be updated. It is therefore necessary on the part of the shareholders to inform

25 5 30 30

Corporate Review

and nomination details to the Company’s Registrar and Share Transfer Agents, Integrated Enterprises (I)

(A) 1



and Central Depository Services (India) Limited (CDSL) and the total listed and paid up capital. This audit

3) Top Ten Shareholders* as on 31st March 2014. S. No.

Name

No. of Shares

Promoters / Promoter Group

47,788,454

34.35

2

Integrated (Mauritius) Healthcare Holdings Limited

15,093,860

10.85

3

Oppenheimer Group

13,267,607

9.54

4

Newton / BNY Mellon

5,917,807

4.25

5

Fidelity

5,646,663

4.06

6

Schroders

4,215,448

3.03

7

Life Insurance Corporation of India

3,638,128

2.62

8

Capital Group

3,481,658

2.50

9

Abu Dhabi Investment Authority

2,592,687

1.86

10

Munchener Ruckversicherungsgesellschaft Akliengesellschaft in Munchen

2,397,380

1.72

104,039,692

74.78

before the Board of Directors. The audit, interalia, confirms that the total listed and paid up capital of the Company is in agreement with the aggregate of the total number of shares in dematerialised form (held with NSDL and CDSL) and total number of shares in physical form.

xiv O utstanding GDRs or Warrants or any convertible instrument, conversion dates and likely impact on equity (i) Pursuant to the resolution ed by the in an Extraordinary General Meeting held on 24th May 2005, the Company had issued 9,000,000 Global Depositary Receipts (GDRs) and the details of GDRs issued and converted and outstanding (after adjusting the split of face value of ` 5/- per share) as on 31st March 2014 are given below :

* The top 10 shareholders have been grouped based on the beneficiary information received from the depositories Total GDRs issued

GDRs :

18,000,000

Add : Equity Shares converted into GDRs during 2011-2012

7,689,329

The details of high / low market prices of the GDRs at The Luxembourg Stock Exchange and Rule 144 A GDRs at

Equity Shares converted into GDRs during 2012-2013

10,949

Portal Market of NASDAQ during the financial year 2013-2014 are as under

Equity Shares converted into GDRs during 2013-2014

439,944

Apr-2013

High ($) 15.48

Reg. S Low ($) 14.98

Closing ($) 15.48

High ($) 15.97

Rule 144 - A Low ($) 15.08

May-2013

19.43

15.33

17.84

19.46

15.32

Less : GDRs converted into underlying equity shares Closing ($) 15.50

4,415,068

2006-2007

2,346,712

17.76

2007-2008

1,515,600

2008-2009

347,020

2009-2010

49,600

2010-2011

6,263,200

2011-2012

5,396,660

Jun-2013

18.18

15.59

17.73

17.99

15.52

17.45

Jul-2013

16.92

15.43

15.43

17.00

15.57

15.57

Aug-2013

15.90

12.60

13.09

15.91

12.47

13.15

Sep-2013

15.14

12.51

14.85

15.12

12.58

14.87

2012-2013

4,597,869

Oct-2013

14.79

13.74

14.79

14.72

13.81

14.71

2013-2014

147,449

Nov-2013

14.81

13.35

13.35

14.76

13.39

13.39

Outstanding GDRs as on 31st March 2014

Dec-2013

15.33

13.22

15.30

15.35

13.22

15.30

Jan-2014

15.30

14.41

14.85

15.33

14.45

14.93

Feb-2014

15.17

14.50

14.85

15.21

14.52

14.92

Mar-2014

15.35

14.04

15.35

15.28

14.04

15.28

Business Review

2005-2006

25,079,178 1,061,044

There is no change in the issued equity on conversion of GDRs into equity shares

The Company had sent three reminders to the shareholders to claim the shares. In response to our reminders,

Note : 1 GDR = 1 equity share.

some of the shareholders have claimed and still 425,692 equity shares have not yet been claimed. Accordingly

xiii

as per the requirements of Clause 5A(i) of the Listing Agreements the Company has transferred 425,692

1) Dematerialization of Shares

Standalone Financials

xv Equity Shares in the suspense :

unclaimed equity shares to the “Apollo Hospitals Enterprise Limited - Unclaimed Suspense .”

As on 31st March 2014, 96.97% of the Company’s paid up equity capital was held in dematerialized form. Trading in equity shares of the Company is permitted only in dematerialized form as per a notification issued

The details of the unclaimed shares is being posted in the company’s website under the column “Investor

by the Securities and Exchange Board of India (SEBI).

Relations”.

2) Reconciliation of Share Capital Audit Report

The voting rights on the shares outstanding in the suspense as on 31st March 2014 shall remain

As stipulated by the Securities and Exchange Board of India, a qualified Practising Company Secretary

frozen till the rightful owners of such shares claim the shares.

carries out the Audit to reconcile the total itted capital with National Securities Depository Limited (NSDL)

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Consolidated Financials

Annual Report 2013–14

Nos.

Statutory Section

Particulars

and includes direct holdings and sub-s managed by them.

Month

Corporate Review

1

Total

is carried out every quarter and the report thereon is submitted to the Stock Exchanges and is also placed

%

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

xvi. Investors Correspondence



a. For queries relating to shares



Apollo First Med Hospital, No.484, B-West First Street, Near District Court, KK Nagar,



Madurai – 625 020 Tel :

“Kences Towers”, II Floor,No.1 Ramakrishna Street,



Apollo Hospitals, No. 163, Allwyn Nagar, Kovai Road, Karur – 639 002.

North Usman Road, T. Nagar, Chennai – 600 017,



Shri. Suresh Babu, Asst. Vice President

Madurai

Lake View Road, K.K.Nagar, Madurai–625 020 Tel : 0452 – 2580 199/2580 892/ 893

Integrated Enterprises (India) Limited

Karaikudi Managiri Sukkanenthal Village, Thalakkavur Panchayat, Kallal Panchayat Union,

Fax No.: 044 – 2814 2479

Karaikudi – 630 001 Tel: 045-6522 3700

E-mail : [email protected] b. For queries relating to dividend Shri. L. Lakshmi Narayana Reddy



Sr. General Manager -Secretarial



Apollo Hospitals Enterprise Limited, Ali Towers, III Floor, No. 55, Greams Road, Chennai -600 006.



Tel. No.: 044 -2829 0956, 2829 3896, Fax No.: 044 -2829 0956,



E-mail : [email protected]

Tiruchirappalli

Varaganeri Village, Chennai Madurai By Road, Tiruchirappalli. Tel: 0431 3307777



Aragonda Thavanampallee Mandal, Chittoor District, Andhra Pradesh – 517 129 Tel : 08573-283 220, 221, 222, 231



Hyderabad

#8-2-293/82-J-III/DH/900, Phase III - Jubilee Hills, Hyderabad – 500 033 Tel : 040-2360 7777



H.No. 3-5-836,837 & 838 Old MLA Quarters, Hyderguda, Hyderabad – 500 029



Tel.: 040-2323 1380, 2338 8338

xvii Hospital Complexes



Apollo Hospitals – DRDO, # 18-14, DMRL ‘X’ Roads, Kanchanbagh, Hyderabad – 500 058

Apollo Hospitals



Tel. No. 040 – 2434 2222 / 2211 / 3333



# 22-1-26/1 & 22-1-25/1 Bhagyanagar Colony, Kukatpally, Hyderabad – 500 072



Tel. No. 040 – 2316 0039/41



PET-CT Scan Centre, Apollo Hospitals Complex, Jubilee Hills, Hyderabad – 500 033



Tel.No. : 040-2360 7777



H-No. 9-1-87/1, Polisetty Towers, St. Johns Road, Secunderabad – 500 003



Tel. No. 040-2771 8888

Nellore

H.No. 16-111-1133, Muthkur Road, Pinakini Nagar, Nellore – 524 004.



Tel: 0861-2301066/2321077

Designated Exclusive email-id: The company has designated the following email-id exclusively for investor grievances/services. [email protected]

Chennai

No. 21 & 24 Greams Lane, Off. Greams Road, Chennai – 600 006



Tel : 044 2829 3333/2829 0200



320 Anna Salai, Nandanam, Chennai – 600 035



Tel : 044 2433 1741, 2433 6119, 4229 1111



No. 646 T.H. Road, Tondiarpet, Chennai – 600 081. Tel : 044 2591 3333, 2591 5858



Apollo First Med Hospital, No.159 E.V.R. Periyar Salai, Chennai – 600 010.



Tel : 044 2821 1111, 2821 2222 Apollo Children Hospital, 15-A Shafi Mohammed Road, Chennai – 600 006



Tel : 044 2829 8282, 2829 6262



New No. 6, Old No. 24, Cenotaph Road, Chennai – 600 018 Tel : 044 2433 4455



No. 134, Mint Street, Sowcarpet, Chennai – 600 079 Tel : 044 2529 6080/84









No.5/639, Old Mahabalipuram Road, Kandanchavadi, Chennai – 600 096



Tel : 044-2496 3697

Visakapatnam



No.10-50-80 Waltair Main Road, Visakapatnam – 530 002 Tel.No.0891-272 7272, 252 9619

Kakinada H-No. 13-1-3 Surya Rao Peta, Main Road, Kakinada – 533 001 Tel.No. 0884 – 2345 700/800/900



Mysore Apollo BGS Hospitals, Adichunchanagiri Road, Kuvempu Nagar, Mysore – 570 023 Tel. No. 0821 – 256 6666, 256 8888

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2/319 Rajiv Gandhi Salai (OMR), Karapakkam, Chennai – 600 097 Tel : 044-2450 5700

Karim Nagar Apollo Reach Hospital, H.No.G.P.No.4-72, Subhash Nagar, Theegalgutta Pally, G.P.Arepally Rev. Village, Karim Nagar – 505 001. Tel. No.0878 220 0000

No.64, Vanagaram to Ambattur Main Road, Chennai-600 095 Tel :044-2653 7777



Standalone Financials



Business Review





Annual Report 2013–14



Statutory Section



Tel. : 04324 - 241900

Corporate Review

Tel. No.: 044 – 2814 0801, 2814 0803,

Karur

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Bilaspur

Lingiyadi Village, Bilaspur – 495 001, Chattisgarh Tel : 07752–243300-02

Bhubaneswar

#251, Sainik School, Unit 15, Bhubaneswar – 751 003. Tel: 0674-6661016/1066/0413

Bangalore

154/11 Bannerghatta Road, Opp. IIM, Bangalore – 560 076 Tel. No. 080-4030 4050

Ahmedabad

Plot No.1A, GIDC Estate, Bhat Village, Gandhi Nagar, Gujarat – 382 428



Tel : 079-6670 1800



Kolkata

No. 58, Canal Circular Road, Kolkata – 700 054 Tel : 033-2320 3040



New Delhi

Sarita Vihar, Delhi Mathura Road, New Delhi – 110 044 Tel. No. 011-2692 5858



Nashik

Swamy Narayan Nagar, Off Mumbai Agra Highway, Near Lunge Mangal Karyalaya,



Corporate Review



Auditors’ Report On Corporate Governance

To The , Apollo Hospitals Enterprise Limited

Panchavati, Nashik - 422 003 Tel: 0253-2510350/2510450

We have examined the compliance of conditions of Corporate Governance by Apollo Hospitals Enterprise Limited, for the year ended 31st March 2014, as stipulated in Clause 49 of the Listing Agreement of the said Company

Other Health Centres

Woodhead Tower, No. 12 Ramaswamy Road, Alwarpet, Chennai – 600 018

The compliance of conditions of Corporate Governance is the responsibility of the Management. Our examination



Tel. No. 044-0467 2200/2498 8866

was limited to procedures and implementation thereof, adopted by the Company for ensuring the compliance



Apollo Heart Centre, # 156, Greams Road, Chennai – 600 006



Tel : 044 2829 6923



Apollo Medical Centre, Plot No. C-150, 6th Cross, Thillai Nagar, Trichy – 620 018

the Company has complied with the conditions of Corporate Governance as stipulated in the above mentioned



Tel. No.0431-2740864

Listing Agreement.



Apollo Emergency Centre, Rajiv Gandhi International Airport, Samshabad Hospital.

We further state that such compliance is neither an assurance as to the future viability of the Company nor the



Tel.:040-2400 8346

efficiency or effectiveness with which the Management has conducted the affairs of the Company.



Apollo Gleneagles Clinic, 48/1F, Leela Roy Sarani, Ghariahat, Kolkata – 700 019



Tel : 033 2461 8028



City Center, 1 Tulsibaug Society, Opp. Doctor House, Ellisbridge, Ahmedabad – 380 006



Tel. No. 079 6630 5800



Apollo Clinic, KR 28, VIP Road, Port Blair, Andaman 744 101 Tel : 03192 233550

of the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the financial

Statutory Section

with the Stock Exchanges in India.

statements of the Company. In our opinion and to the best of our information and according to the explanations given to us, we certify that

Mylapore, Chennai – 600 004

Business Review

17, Bishop Wallers Avenue (West)

For M/s. S. Viswanathan Chartered ants



V.C. Krishnan Partner

Date : 2nd July 2014

Declaration under Clause 49 of the Listing Agreement regarding adherence to the Code of Conduct I, Preetha Reddy, Managing Director of the Company, hereby declare that the Board of Directors has laid down

Standalone Financials

Place : Chennai

a Code of Conduct for its Board and Senior Management Personnel of the Company and the Board

For APOLLO HOSPITALS ENTERPRISE LIMITED Place : Chennai

SUNEETA REDDY

Date : 2nd July 2014

Managing Director

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Annual Report 2013–14

and Senior Management Personnel have affirmed compliance with the said code of conduct.

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Management Discussion and Analysis

•

Infant and maternal mortality ratio

•

Size of the healthcare market

Healthcare spending as a percentage of GDP in India has reduced from 4.3% in 2000 to 3.7% in 2010. The decline in the proportion to GDP implies that the growth in expenditure on healthcare has not kept pace with the growth in GDP. The corresponding global average for healthcare spends as a percentage of GDP was 8.2% in

Due to the low public expenditure and under-utilization of allotted resources, the private sector s for

General Overview of Healthcare Services in India

a major share of the total healthcare expenditure in India. While the proportion of Government expenditure to

India has had several achievements in the growth of its healthcare services sector since independence. The

private expenditure has marginally improved from 26:74 in 2000 to 28:72 in 2010, India continues to report the

country inherited basic and limited healthcare infrastructure which was grossly inadequate to meet the demands

highest proportions of private investment in healthcare spending by nations across the globe. The global average

of a large and diverse populace. From that starting point, India has emerged as a serious player in the global

for proportion of public spending to private healthcare spending was 59:41 in 2010.

healthcare services delivery landscape with a multitude of world-class healthcare institutions imbibing the highest

Corporate Review

2000 and 9.2% in 2010.

Another standout feature of the healthcare services delivery landscape in India is that out-of-pocket spends as a

standards of clinical excellence.

proportion of total healthcare spending continues to remain high at about 86% of total healthcare expenditure in 2010. This is due to a low public spend and moderate penetration of health insurance. The global average has

last two decades the private sector in India has steadily grown and enhanced its quality of operations to emerge

remained steady at ~50% during the period from 2000 to 2010.

as the leading provider of the entire array of healthcare services. Though Government initiatives in the field of

The global average for per capita spend on healthcare expenditure has significantly increased (in PPP ) from

healthcare are largely critiqued, there have been several meaningful initiatives and innovative reforms.

US$ 564 in 2000 to US$ 1,017 in 2010. In India, the corresponding figures compare poorly despite growing from

Statutory Section

While the public sector was the predominant service provider for most of the post-Independence era, over the

US$ 65 in 2000 to US$ 126 in 2010.

Although, there has been reasonable progress in several areas, multiple deficiencies continue to exist in the delivery of healthcare services in India. These parameters need to be addressed immediately and effectively.

However, despite the progress made by the private sector over the years, infrastructure gaps persist in the

Several Millennium Development Goals are unlikely to be achieved by 2015. Despite a considerable decline in

industry. The bed availability in India stood at 9 per 10,000 by 2012 which was significantly lower than the WHO

child malnutrition rates over the past few decades, India continues to have the highest number of malnourished

guideline of 30 beds per 10,000 population. In of availability of medical staff, the number of doctors and nurses available for every 10,000 was at 6.5 and 10.0 in India compared to the global average of 13.9 doctors

is yet to overcome health challenges posed by infectious diseases and under-nutrition. The country will need to

and 29.0 nurses per 10,000 population. (Source: WHO World Health Statistics, 2013)

battle this dual burden simultaneously. The growing rural – urban divide, abysmal state of public infrastructure, under-allocation of resources towards the sector and the increasing scarcity of qualified doctors indicate that

The existing healthcare system in India is heavily skewed in favour of the urban areas, which for only

India will be hard pressed to drive improvements in of key healthcare adequacy metrics for some time.

25-30% of the population. This disproportionate distribution of health services also results in increased cost of

Business Review

children in the world. While India is witnessing an increase in chronic disease related morbidity and mortality, it

treatments, delays and sub-optimal treatments.

However, there have also been significant improvement in various offerings across the healthcare spectrum in India. This is apparent from the strides made in primary care to quaternary care, expertise across various

Further, the public perception about care and quality in a Government healthcare facility is not as favourable as

specialties, adoption of technology-based treatments and large volumes of complex medical procedures being

compared to private healthcare delivery systems. Ensuring healthcare for all calls for a multi-disciplinary & multi-pronged approach. Significant improvements in the

colleges, pharmacies or medical insurance have resulted in extending and widening the reach of healthcare to all

delivery mechanism cannot be brought about by just changing or applying pressure on one factor and leaving

corners of the country.

the others unchanged. A model obsessed with controlling costs without paying attention towards changing other determinants will not lead to creation of a successful delivery system. Determinants like accessibility, quality

The Healthcare Services Delivery Landscape in India

standards, equitability, resource availability and equitable distribution need to be worked upon simultaneously to

Standalone Financials

undertaken. The simultaneous progress and growth of allied offerings like diagnostics centres, medical & nursing

produce visible changes.

A detailed analysis of the healthcare system in India reveals that our health care model needs further augmentation

•

Health expenditure as a percentage of GDP

•

Per capita spending on healthcare

•

Doctor-to-Population & Hospital Bed-to-Population ratio

Key Characteristics A track record of sustained growth over the last several years along with the potential for accelerated growth in the future has sharpened the focus on the healthcare services delivery sector. Fundamental strengths are

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Consolidated Financials

Annual Report 2013–14

on several vital parameters, namely:

to the quality of services offered by its private healthcare service providers.

Population growth and changing demographics

Disparity in Health Infrastructure between urban and rural areas

India’s population is predicted to grow from approximately 1.2 billion in 2011-12 to over 1.5 billion by 2026. It

The progress made by private healthcare service providers in the last few years has been mostly confined to

is already the second most populated country in the world and is expected to sur China by 2025. India

urban areas. These areas are now home to a wide variety of facilities offering single specialty, multi-specialty,

is currently at less than a third of the recommended global benchmark of 30 hospital beds for every 10,000

primary care, quaternary care as well as value added services and bespoke offerings. These urban markets

of the population (Source: WHO), Thus, there is already a significant backlog of healthcare infrastructure

cater to local residents as well as to international medical value travellers and also to a large share of patients

in the country. The continued population growth will result in additional demand for healthcare infrastructure. In

from surrounding rural areas. Increased competitive intensity has resulted in pockets of oversupply in some of

addition to growth in population, increased life expectancy is leading to an increase in the absolute number of

the urban areas. Semi-urban and rural areas are at the other extreme with several areas lacking even in basic

middle-aged and older adults, leading to a corresponding increase in demand for healthcare delivery systems

amenities. Thus there is a vast disparity in offerings between the metros and urban centers vis-a-vis the semi-

and services.

urban and rural areas in the country.

Rising Burden of Non Communicable Diseases

Evolving Business Models

The burden of non-communicable diseases (NCDs) is reaching alarming proportions in India. India is already

Increased competition and the ever increasing cost of resources has encouraged innovation in the healthcare

the global capital for cardiac disease, diabetes and cancer. These diseases are driven by changes in lifestyle

industry. The last two decades have seen the emergence of private hospital chains, single specialty chains and

and shift in dietary patterns and now for an increasing proportion of deaths. Apart from the standard

boutique healthcare centers. It is now common for healthcare service providers to focus on a single specialization

disease profile within a population, our country is faced with the additional disease burden from NCDs which is

such as eye care, orthopedics, cardiac care or maternity. These business models have proven effective in increasing

intensifying the need for healthcare delivery and associated medical facilities.

efficiencies through higher volumes resulting in reduced costs while delivering comparable quality standards and

Statutory Section

from all corners of the globe. India is steadily ri the ranks of emerging Medical Tourism destinations due

the following:

Corporate Review

contributing to a favourable view for investing into the sector and the industry in India which is characterized by

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

success rates. Touch points have also multiplied with all-encoming hospitals at one single location being

Inadequate Public Infrastructure

replaced by multiple interface points such as standalone clinics, diagnostic centers and pharmacies. At the other

In several countries around the world, healthcare delivery is the primary responsibility of the State. However,

end of the spectrum, integrated healthcare delivery centers like Medicities are also emerging as viable business

in India, due to the scale of demand and the resources required to adequately service that demand, public

models in the Indian healthcare services industry.

healthcare infrastructure has been found wanting. While there are several Public Healthcare facilities of repute

Increased focus from Investors

public healthcare infrastructure is present it is poorly managed as it either lacks the adequate number of medical

The long-term growth potential of the healthcare industry in India has never been in doubt. However, investors

professionals, necessary medical equipment or basic standards of hygiene. Private healthcare service providers

have been deterred by the track record of high capital intensity and elongated gestation periods. In recent

have emerged to cater to the unmet demand for quality healthcare services in India.

years, steps to moderate capital intensity such as leasing of premises, franchising, operating and maintenance

Business Review

these add up to a miniscule fraction of the overall requirements. Further, in many parts of the country even though

contracts, etc. have helped to somewhat mitigate such concerns. Further, innovative delivery models and value added services have led to increased capital efficiency and improved asset turns. This has resulted in multi-

The economic progress of the last few years has led to a rise in per capita and increased disposable income.

faceted growth in the healthcare industry even as several other industries are faced with slowing or declining

This has resulted in a significant expansion of the addressable market for private healthcare providers. Further,

growth due to the challenging economic conditions. As a result, there has been a notable increase in venture

consumer awareness has increased and patients are willing to pay for better infrastructure, improved diagnostic

capital and private equity investments into the industry.

facilities, latest technology and best-in-class medical care. This is ed by increased health insurance coverage across the country leading to a preference for accredited facilities. Given these factors, patients are

Retail Pharmacies

inclined towards private hospitals and the addressable market is expected to grow further paving the way for

In India, pharmacies are the dominant distribution channel for pharmaceutical companies and generate a majority

sustained growth of private healthcare service providers.

of overall sales. However, the industry is highly fragmented in nature and is dominated by the unorganized segment or stand-alone units which enjoy a comprehensive presence across the country. It is only in recent years

Emergence of Medical Value Travel

that the organized segment has scaled up its presence by setting up chains of retail pharmacy stores.

Deeper penetration of technology into everyday lives has broken traditional barriers and transformed the world into a global marketplace. This has led to the emergence of medical value travel. Patients can now evaluate

There are approximately 800,000 pharmacies in India today with about 60,000 distributors. In value , the

healthcare institutions across the globe from the comfort of their own homes. They can assess clinical outcomes,

size of the total retail pharmacy market is estimated to be between ` 750,000 and ` 800,000 million. Out of this,

confirm accreditation standards, evaluate physician success rates and compare healthcare costs at facilities in all

the organised market s for approximately ` 30,000 million or less than 5% of the overall market.

corners of the world. Healthcare service providers who offer a compelling value proposition now attract patients

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Consolidated Financials

Annual Report 2013–14

Standalone Financials

Rising per Capita Income and Quality Consciousness

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | Organized players are now making steady inroads into the market and gradually increasing their market share.

SWOT Analysis

They are responsible for the improved quality of retail services and have raised the bar on customer centricity by introducing trends like loyalty schemes, discouraging spurious drugs, tele-consultation services, private labels

Strengths

and value added services such as basic diagnostics and health insurance plans.

Trusted and Preferred Brand: Your Company is well known as the first corporate hospital network in the country. An impeccable track record, several pioneering initiatives and the sheer number of surgeries with high

Entrants into the organised market comprise a mix of pharmaceutical or healthcare service companies, large

success rates have helped to establish the “Apollo” brand as a premier brand in the healthcare sector in India. This brand value provides several tangible and intangible benefits such as the belief and trust that makes patients

Karunya pharmacies.

choose Apollo, the ability to attract doctors and other healthcare professionals ahead of competition, ability

The key challenges that need to be addressed are inefficient distribution and supply chains, counterfeit and

to appropriately price its healthcare services, sustained marketing benefits and a headstart in footfalls at new

spurious drugs, shortage of trained and qualified manpower, increased competition from international players and

facilities.

the prohibitive cost of real estate. The recent legislation fixing maximum prices for certain essential medicines has

Integrated Healthcare Delivery Model: Our presence in various initiatives across the healthcare services delivery

the effect of compressing profit margins in the industry.

chain gives up a competitive advantage and we are able to benefit from the following:

However, the potential remains high and the sector is gradually maturing and will see increased innovation and

•

improved scale from the larger players. In addition, the entry of global players will bring in increased sophistication

Our pan-India presence in primary clinics, telemedicine, retail healthcare and other healthcare programs provide increased touch points for patient access.

Health Insurance

•

Captive market to cross sell businesses of pharmacies, health insurance and self-branded products.

•

Ability to participate in a wider spectrum of the patient treatment cycle from diagnostics to hospitalisation to

For the purpose of regulation, health insurance companies are classified as non-life companies. Despite the

insurance coverage up to ongoing medication requirements post-hospitalisation

country’s worst slowdown in over a decade, the annual growth in s of the non-life insurance sector

•

was a healthy 12% for 2013-14. Health insurance’s annual collections were just over ` 70,000 million

Statutory Section

and standards and set the tone for sustained growth in the retail pharmacy sector.

Synergistic revenue streams which have differentiated characteristics in of resource use and capital intensity

(Source: IRDA). Despite a healthy growth, profitability in the business remains a challenge due to the prevalence of a high claims ratio.

•

Though the health insurance industry is nearly 30 years old, the penetration level remains low with less than 20%

Scale: The network of 50 hospitals, 1,632 pharmacies and over 100 clinics and retail healthcare centres provide

Access to qualified and trained medical resources through our educational initiatives

us with the following benefits:

facilitated the entry of many private sector health insurers. Even then, the industry continues to be dominated by four public sector entities (National, New India, Oriental, and United India) that together have 60% market share. The rest of the share is spread over 17 private sector players including the standalone health insurance players.

•

Cost efficiencies through sharing of managerial and clinical resources;

•

Economies of scale and ability to obtain competitive prices from our suppliers and service providers due to

Business Review

of the population being covered by adequate health insurance. The industry was liberalised in the year 2000 which

centralized purchasing;

The insurance penetration level in India is very low when compared with the global average. Over 80% of health care spends continues to be from private financing, much of which is out of pocket payments and employer

•

funding. Prima facie it seems that there is significant scope for health insurance to grow further. However, there

The ability to absorb initial ramp up costs during the gestation period of new hospitals without significantly impacting overall operating performance

High Quality and mature facilities: The Company has a strong emphasis on clinical excellence in its operations.

The Industry is getting mature as the overall service levels and customer management standards are improving.

We conduct a large number of complex and high-end medical procedures with outstanding success rates and

The introduction of health insurance portability has offered more convenience to customers and has enhanced

clinical outcomes. We have the largest number 8 of JCI accredited facilities by any single healthcare group in

competition in the industry.

India / Asia and also have 10 facilities which are accredited by NABH. The first mover advantage has enabled your

Co-ordination by the IRDA to address sustained losses in the industry by permitting revision in s and

company to establish hospitals at prime locations in several cities in India at costs which cannot be replicated.

allowing for negotiation with hospitals has helped to improve the financial position of the industry. This is expected

Apart from that, 67% or 3,896 of our 5,811 operating beds are over 5 years old which indicates the strength and

to spur further innovation and encourage introduction of customer friendly products which will pave the way for

maturity of the business.

sustained growth in the years ahead.

Standalone Financials

are several consumer prejudices which will take time to overcome.

Arrangements with Doctors / Medical Personnel: Our consultant engagement model with senior doctors provides them the professional comfort and freedom to deliver optimal performance. Many of the doctors associated with us are prominent within the medical field having received accolades and awards or are heading national medical associations. We are also among the leading private healthcare services employers in India.

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Corporate Review

corporates, entrepreneurs and even the Central and State Governments through the Jan Aushadi outlets and

The medical colleges and training establishments within our group provide us with an abundant number of newly

Obsolescence of medical equipment: We use the latest medical equipment in our hospitals to provide top

qualified medical personnel the lack of which can otherwise be a serious constraint to growth and efficiency.

quality healthcare services. Due to the extent of global research and development into healthcare and frequent

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

product improvements and evolving technology, the rate of obsolescence of equipment is high. Many times, such Professional Management team with rich industry experience: Our management team comprises of senior

equipment can become redundant well before their projected useful life. Rapid obsolescence reduces the time

professionals with abundant expertise and knowhow. They possess a proven track record in the healthcare

frame for recovery of investment and dilutes capital efficiency.

services industry and have been instrumental in driving strategy and growth. The blend of doctors as well as Lack of Standardisation: Healthcare is an extremely dynamic industry and there are varied requirements even

of delivering high standards of clinical excellence, best-in-class patient care, rapid technology adoption, value

in markets which are reasonably proximate. Every market has a unique set of circumstances with variance

optimization and focus on key specialties while growing in a steady and calibrated manner.

in demographics, disease profiles, customer attitudes, seasonal variations, price sensitivity and so on. Even hospitals in two different cities in the same state will not be subject to identical operating circumstances. This

Pioneer in Leveraging Technology: Your Company has been a pioneer in adopting cutting edge technology to

requires a higher degree of customization and adaptability. The lack of standardisation necessitates increased

elevate treatment quality and clinical standards in India. From introducing the first MRI machine in the country to

intensity in the level of monitoring and clinical governance.

Corporate Review

qualified professionals for key functions has enabled the company to repeatedly balance the multiple objectives

the recent focus on robotics and the ongoing project to introduce the Proton Cancer Therapy in India, Apollo has consistently been at the forefront of introducing technology based treatments in India. This factor has been a key

Complex business model: The hospital business is not a ‘plug and play’ business by any standard. Merely

enabler for maintaining high clinical standards and helps to attract renowned doctors from India and abroad and

having all of the necessary resources is not a guarantee to success. Due to the many moving parts, rigorous

in improving efficiency in operations.

management overview is required for sustaining clinical standards, balancing case mix, ensuring adequate multiple operating metrics to monitor and analyse. The operating environment is dynamic and the organization

Weaknesses

has to appropriately respond to the ongoing challenges.

High intensity of resources: The healthcare services delivery business requires deployment of significant amount of resources which are either expensive or scarce or both. The upfront investment to set up a hospital is high as the ‘per bed’ cost to set up a tertiary hospital in an urban area can be upwards of ` 10 million per bed. This

Opportunities

includes costs of building, construction costs, interiors and costs of plants & machines and medical equipment.

Increase in population and changing demographics: India is the second largest populated country in the

Once operational, hospitals are also labour & skill intensive. Skilled manpower includes doctors, nurses and para-

world and is expected to see its population expand from 1.2 billion people currently to 1.5 billion people in 2015.

medical staff comprising lab-technicians, radiographers and therapists all of whom are in short supply in India.

Further, with increasing longevity the number of middle-aged and elderly people is expected to multiply. This will

The overall requirement for such scarce resources makes it challenging to set up and profitably run a hospital

result in an increase in demand for all kinds of healthcare services manifold. Change in disease patterns: India is the cancer, diabetes and heart disease capital of the world. This rising

Long gestation period: Apart from the significant upfront capital outlay on land, building and medical equipment

burden of non-communicable disease is a sad reality and a challenge that Indian healthcare service providers will

at the time of setting up a hospital, operating costs are also high. Though there are exceptions, the average

need to effectively address.

maturity time frame for a facility to turn net income positive is approximately 4-5 years. Inability to scale up

in lifestyle caused by increasing incomes and improved affordability. The sheer volume of cases will mean that a

occupancy in new facilities could adversely affect our operating efficiencies and our profitability. The establishment

manifold increase in bed capacity will be required on a pan India basis to address this challenge.

of marquee facilities which are now mature and generating positive cash flows has improved your Company’s

Under penetration in semi-urban and rural areas: Notwithstanding the sophisticated healthcare facilities

ability to service debt capital.

and pockets of over-capacity in certain urban centres, there continue to be several regions within the country where healthcare facilities remain woefully inadequate. Despite the ability and the willingness to pay for quality

are multiple rules and regulations to adhere to even in day-to-day operations like importing medical equipment,

healthcare services patients in these areas are forced to opt for moderate or sub-standard facilities for lack of a

setting up parking facilities at hospitals or adding or reducing staff. The present regulations pertaining to medical

better alternative. These catchment areas can prove to be low hanging fruit for healthcare service providers who

visas are a constraint to expand the share of medical tourism. The lack of proactive and favourable regulation

are able to offer quality healthcare services with excellent clinical outcomes. We plan to serve the demand in

has blunted some of the potential that the healthcare sector could have realized over the last several decades.

some of these areas for quality healthcare services through our “REACH” initiative.

Scarcity of doctors and medical personnel: The hospitals business is skill & talent intensive. The quality of

Increase in demand for elective surgeries: Given steady increases in disposable incomes and growing health

doctors and ing healthcare professionals are critical to the quality and efficiency of the business. Top

awareness, there has been a manifold expansion in demand for elective or planned surgeries. Patients are now

quality doctors and medical personnel are a finite resource and these professionals enjoy abundant opportunity

willing to undergo discretionary treatments and healthcare procedures where the goal is to enhance health and

in the form of entrepreneurial ventures, independent practice as well as competing offers from other service

quality of life. These procedures are known as electives as patient can ‘elect’ to undergo these treatments. We

providers in India and abroad. Our continued performance and growth substantially depends on our ability to

intend to concentrate on this requirement and build a strong presence in this segment.

attract and retain the best of skilled medical talent and professionals.

Increasing incidence of medical tourism: Earlier, patients would travel across borders to access high quality medical care which was unavailable in their home countries. However, these disparities are less common today

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Lack of Regulatory Vision: There is a requirement of over 80 licenses and approvals to set up a hospital. There

Standalone Financials

Annual Report 2013–14

The increase in NCDs is an outcome of changing dietary patterns and alterations

Business Review

in India.

Statutory Section

volumes and regularly upgrading technology. In addition, there is a high level of doctor interaction combined with

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | and quality healthcare is available in various regions across the world. However, it is now commonly known

Industry Outlook / Prospects

that healthcare in developed countries is unaffordable for many. This has led to the increasing prevalence of

The healthcare services industry will need to work towards addressing the key issues plaguing the sector. In

medical value travel. In addition to regional peers like Singapore, Malaysia and Thailand, India is fast emerging

addition to the shortage and the inequitable distribution of health infrastructure across the country, the sector

as a preferred destination. Indian doctors are already highly regarded for competency and expertise. If India can

will have to tackle the shortage of doctors as well as the growing burden of lifestyle diseases. This will require

continue to make progress on quality of healthcare delivery and facilities and ease the overall process, it could

innovative solutions and high investments; factual evidence suggests that creation of one bed in the tertiary

garner a significant market share of global medical tourism. High number of under-performing facilities in India: Due to the attractive returns delivered by the leading

For a transition towards the desired ratios of 30 beds per 10,000 population, over 2 million new hospital beds

healthcare companies in India, there is a perception that the healthcare business is highly remunerative. As

need to be created. Moreover, assuming a split of 70:30 between secondary and tertiary care, an investment of

a result, there has been a rush to set up healthcare facilities across the length and breadth of this country.

gigantic proportions is required.

However, the approach in several cases does not factor in the ground realities. Due to their inability to invest in the appropriate medical technology, absorb initial period losses, attract medical talent or increase footfalls,

Mobilizing a capital spending of this order for capacity building is neither possible for the Government nor for the

several medical facilities set up across the country are incurring operating and financial losses. This presents itself

private sector if they work in isolation. Hence, this calls for innovative out of the box solutions and development

an opportunity for experienced hospital operators like us to acquire such facilities and leverage our strengths to

of new business models.

Corporate Review

sector entails an investment upwards of ` 8 million and ` 4 million upwards per bed in the secondary care sector.

turn them around. Better utilization of under-utilized Government infrastructure, incentivizing capital flows into the sector and It is likely that private players will continue to upgrade their skills and the overall healthcare market will be divided

Heightened competitive intensity: The increasing propensity for entrepreneurs and business houses to enter

more categorically into sub-markets based on geographic location, complexity of care and economic strata of

into the healthcare business has resulted in a spike in setting up of greenfield facilities, JVs and acquisitions.

population being serviced.

There are even pockets of over-capacity in some metros. In order to make these ventures remunerative after

Statutory Section

leveraging on technology to reduce intensity of physical infrastructure are some of the options under consideration.

Threats

having invested significant funds, there is a chance that some of these players may resort to unsustainable pricing in order to gain market share.

Company Overview

Increasing cost of resources: The emergence of several domestic hospital chains combined with the entry of

Apollo Hospitals was founded by Dr. Prathap C. Reddy in 1979 and became a public listed company on the BSE in 1983 and was listed on the NSE in 1996. Your Company launched India’s first corporate hospital in Chennai

international players is leading to an increased number of competitors chasing finite resources such as land,

50 Hospitals, 1,632 Pharmacies, over 100 primary care & diagnostic clinics, 115 telemedicine units across

supply of these resources. A failure to acquire resources at fair and reasonable rates will impact the ability

10 countries, health insurance services, global projects consultancy, 15 academic institutions and a Research

to suitably grow and expand our operations. Further, increases in operating costs can impact the Company’s operations and financial condition.

Foundation with a focus on global clinical trials, epidemiological studies, stem-cell and genetic research.

Discontinuation of leases: The lands on which our hospital buildings and our stand-alone pharmacies are

Your Company is headquartered in Chennai and its diversified operations include multiple subsidiaries, t ventures and associates. It runs large hospital clusters in Chennai and Hyderabad and has established landmark

operating on are not owned by us. In case the lease arrangements relating to these properties are not renewed in our favour or on that are not favourable to us our business operations may suffer disruptions.

hospitals in Delhi, Bangalore, Kolkata, Ahmedabad, Pune, Bhubaneshwar, Madurai and Mysore.

Losing out on the Medical Tourism Opportunity: Several countries in the Asia-Pacific region have woken up to

Its healthcare facilities comprise a mix of primary, secondary, and tertiary care facilities. The tertiary care oncology, neurosciences, critical care, orthopedics, radiology, gastroenterology, and transplants. In addition, it

in the form of subsidized capital, ease in permissions and tax benefits. Further, due to enhanced infrastructure

is increasingly focusing on technology based treatment areas such as minimally invasive surgery, robotics and

and simplified visa norms, they are poised to grab a larger share of the opportunity. India will need to rapidly address issues and improve its competitiveness in this arena.

technology for cancer.

Withdrawal of tax incentives: Since fiscal 2011, we have benefited from the tax deduction given in respect of

In addition to existing operations, the Group has several initiatives underway which includes setting up of the

Standalone Financials

hospitals in the network provide advanced levels of care in over 50 specialties, including cardiac sciences,

the opportunity to attract Medical Tourists. These countries are providing incentives to domestic service providers

Proton Therapy Centre in Chennai. This will be the first of its kind in the Southern Hemisphere and is well

capital expenditure incurred on setting up new hospital projects. The resultant deferment of tax has helped to

placed to offer advanced oncology therapy to a combined population of over 3.5 billion people in Asia, Africa

improve our immediate cash flows allowing us more resources to fund growth. Any withdrawal of tax incentives

and Australia. It is also expanding its network of Retail Healthcare Centres including Dental Clinics and Lifestyle

or increase in corporate tax rates will result in increased liabilities and reduced returns to the business.

Birthing Centres. Significant efforts are also underway to integrate cutting edge technologies and innovative systems such as Paperless Hospitals, Tele-radiology, homecare services, wearable devices and personalized medicine into mainstream offerings.

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in 1983. Now, as Asia largest and most trusted healthcare group, its presence includes over 8,617 beds across

quality medical professionals and potential acquisition targets. Demand growth is expected to outpace improved

Healthcare Services

Accreditations

Our healthcare services segment consists of hospitals, hospital-based pharmacies and projects and consultancy

As the world becomes smaller and progresses towards a vision of becoming one large global marketplace,

services. We have discussed the projects and consultancy services in a separate section in this Management

patients will increasingly be able to pick and choose a hospital facility in any part of the globe. In order to ensure

Discussion and Analysis.

standardization of healthcare delivery services across the globe, facilities are opting to be accredited by a credible

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

agency or third party organisation which can evaluate and grade healthcare services according to a set of standards which are revised on a periodic basis. Eight of our hospitals have received accreditations from the t Commission International, USA (“JCI”) for

As of March 31, 2014 we had a capacity of 8,617 beds in 50 hospitals located in India and overseas. Of the 8,617

meeting international healthcare quality standards for patient care and organization management. JCI is the

beds, 6,684 beds are in 39 hospitals owned by us and 1,933 beds are in 11 hospitals under our management

world’s premier accreditation body for evaluation of healthcare facilities. Our Hospitals at Bangalore, Chennai,

through operations and management contracts

Delhi, Hyderabad, Kolkata, Ludhiana, Dhaka and Mauritius have already received the accreditation and we are in 31.03.2014

Number of owned hospitals at end of period Number of owned beds at end of period

6,684

6,382

Number of operating beds at end of period

5,811

5,549

In-patient discharges (Nos.)

331,678

313,348

Adjusted discharges (Nos.)

459,588

430,959

4.54

4.65

4,126

3,993

71%

72%

23,684

21,702

Average daily census Bed occupancy rate (%) Average revenue per occupied bed per day (`)

In developing countries like India, where health services are delivered mainly through private health providers, regulation is a vital instrument and function of government policy. To that end, the government has set up the National Accreditation Board for Hospitals & Healthcare Providers (“NABH”) to establish and operate accreditation programmes for healthcare organisations in India. It is a constituent board of the Quality Council of India. Apollo Specialty Hospitals in Chennai and Madurai and our hospitals at Ahmedabad, Noida and Secunderabad have received accreditations from NABH.

Strategy We remain focused on capacity creation with the objective of simultaneously improving operating efficiencies. We aim to achieve this through: Creation of new Healthcare Delivery Capacity in India: Our primary focus will be the delivery of healthcare regions which are under-served and leading healthcare providers must strive to enhance their presence across

Clinical Excellence

the country. Mergers and acquisitions are not ideal for capacity creation and providers must strive to add new

Apollo Hospitals has always accorded high priority to clinical excellence. It has identified the highest standards of

capacity or leverage unutilized facilities to ensure ‘incremental’ capacity is introduced to address the shortfall of

clinical outcomes in various specialties across the globe and set itself targets to meet or sur these standards.

Business Review

services in India. The addressable market is large and is growing each year. We believe that there are several

healthcare infrastructure in the country. Our expansion initiatives complement our plans for the core segment of

In the process it has developed an enviable track record of clinical excellence.

delivery of healthcare services.

In order to ensure sustainable clinical outcomes the Company follows an internal quality management process

Leveraging multiple formats to touch more patients: In addition to the healthcare services delivery business,

known as the “Apollo Clinical Excellence” program which is referred to as “ACE @ 25”. This has been implemented

our businesses of retail pharmacies, health insurance, medical education, telemedicine, projects & consultancy, lifestyle birthing centres and dental clinics provide us with multiple touch points to interact with patients. These

are critical to delivering the very best clinical outcomes. In order to enhance its standards even further, the

touch points enable the brand to improve the connect with patients and also help to serve patients better near

Company has introduced the Rocket ACE program which covers an additional 25 parameters leading to an

to their homes.

advanced clinical performance assessment model for key focus areas.

Focus on high acuity cases: The healthcare services market is large and diverse with multiple challenges which

During FY13, on the occasion of World Heart Day, the Group announced that it has completed 130,000 Heart

Standalone Financials

across the entire network of hospitals. ACE @ 25 assesses performance based on 25 clinical parameters which

has to be addressed. However, since our resources are finite we need to focus on specific areas where we can

Surgeries, since inception, which is by far the largest cardiac program across the globe. Further, the Group

optimize efforts and value. We have therefore identified cardiology, oncology, neurology, critical care, orthopedics

reported a success rate of 99.6% for these surgeries which places it among the leading healthcare entities across

and transplants as key focus areas for our tertiary care hospitals. We internally designate these focus areas as

the globe on the basis of clinical standards.

“Centers of Excellence”. We have invested significant resources to develop robotic surgery capabilities and have

A focus on clinical excellences enables Apollo Hospitals to continuously assess the quality of care provided to

the largest solid organ transplant program in the world. We believe that it is essential to increase volumes of high

patients and allows it to objectively measure the consistency and success of its healthcare delivery services.

acuity cases at our facilities to maximize our productivity in the healthcare services market.

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38

Average length of stay (days)

the process for preparing other facilities for evaluation.

31.03.2013

39

Corporate Review

Hospitals

Multi-pronged expansion plan: Despite a wide presence across the country there are many areas within the

Lastly, it will simultaneously expand in Tier II and Tier III cities in India through its “REACH” hospitals initiative. The

country where we wish to augment our presence. As branching out is a gradual process requiring gestation of

REACH initiative envisages setting up of secondary care facilities in these cities leading to a win-win situation for

new facilities, we need to selectively expand our presence across the country. We plan to augment our presence

the Company as well as its patients. A large majority of cases can be handled at these hospitals and complex

in major urban centres such as Chennai, Hyderabad, Kolkata, Bangalore and New Delhi where we already have a

cases can be treated at tertiary care centres in Tier I cities.

significant presence. We also wish to enter in cities like Mumbai, Patna and state capitals. By setting up multiple

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

The current expansion plan envisages an addition of 350 beds in REACH Hospitals in Nellore and Nashik, 300

facilities in each of these cities we plan to develop ‘clusters’ of hospitals in several major urban centres in India

presence in these cities. In FY15, the Company also plans to launch its first hospital in Mumbai of 350 beds as

augment our presence in Tier 2 and 3 cities in India through the REACH hospitals initiative.

well as its first hospital in Indore comprising of 175 beds apart from a 250 bed hospital in Vizag. This will be

Hub and Spoke Model: We have set up a network of Clinics, REACH Hospitals, pharmacies and telemedicine

supplemented by a hospital in Patna in FY16 and further expansion in Mumbai and Chennai Metros in FY17 and

units. All these centres act as the primary touch point for patients. As setting up of these facilities is significantly less

FY18.

resource intensive vis-à-vis secondary or tertiary care facilities, we can apply differential strategies when adding

Corporate Review

beds across four facilities in Chennai and a 180 bed hospital in North Bangalore which adds to the existing

which will help us to diversify and strengthen our network in these key markets. Thirdly, we plan to simultaneously

In addition to the planned addition of beds and hospitals, there are several initiatives that will aid in expansion.

such facilities either in urban centres or semi-urban centres. These centres will offer basic healthcare services and

The setting up of a Proton Therapy Centre in Chennai which will be the first of its kind centre for cancer treatment

refer any high acuity cases back to the main hospitals. These facilities act as spokes and contribute to increased

in the Asia Pacific Region will entail an investment of ` 4,200 million. This covers the cost of equipment and

volumes of the entire network including the tertiary healthcare facilities. Similarly, we are implementing processes

services including long-term operation and maintenance. There are plans to enhance retail healthcare presence

to facilitate outpatient departments and day care centres for all non-critical treatments at these facilities which

The expansion plans are based on management estimates. The actual dates of completion and the actual

Technology and new initiatives: The Apollo Hospitals Group has always been at the forefront of technology

number of new beds to be rolled out on completion of each planned project may differ from the estimated dates

excellence and has been the first to leverage several innovative technologies for the benefit of patients. By

or numbers set out above due to various factors.

employing the latest offerings, we have been able to enhance clinical outcomes, reduce ALOS and optimize value while improving the patient care experience. we plan to continue in the same vein with the increased

Capital Expenditure

Centre in Chennai. We also plan to introduce new formats for healthcare delivery. These include lifestyle birthing

Apart from the expansion plans outlined above we have made investments to increase bed capacity in existing

centres, primary care clinics, dental clinics, larger sized pharmacy stores as well as units for teleradiology and

centres and incurred maintenance and refurbishment costs. We have invested in new technologies, modernization

telemedicine which have been positively received by patients across the network.

of facilities and expansion of services. We believe that these investments will help us to attract and retain doctors and to make our hospitals a preferred choice for patients.

Cultivate Regulatory : The healthcare industry is facing multiple challenges on of increased costs of capital, scarcity of medical resources, increased competition from regional markets, archaic laws and

Our Board has approved a capital expenditure of around ` 21,000 million for our expansion plans stated above.

regulations. A single player in the industry will have a limited impact when championing for changes in regulation.

Of this ` 6,000 million has already been invested and the balance ` 15,000 million will be invested in a calibrated

Your Company has been one of the founding of Healthcare bodies such as ‘NATHEALTH’ and the

manner over the next three years. This will be financed from existing funds, internal accruals as well as through

Healthcare Alliance which comprise several leading players of the Healthcare Industry as . It is expected

debt funds. Capital expenditure primarily relates to expansion activities. The amount and purpose of these

that these bodies will act as a unified voice for the Healthcare Industry and lobby for incentives and forward

expenditures may change in accordance with business requirements.

Business Review

thrust on Minimally Invasive Surgery and Robotics and the introduction of the ground-breaking Proton Therapy

Statutory Section

with the rollout of clinics, dental care centres, lifestyle birthing centres and pharmacies.

will allow for a larger proportion of capacity at existing hospitals to focus on high end tertiary care.

looking legislation intended to promote the growth of the healthcare industry in India.

The Apollo “REACH” Hospitals initiative is aimed at setting up a network of secondary care facilities with around

Your Company has chalked out aggressive growth plans for the next 3 years which will see it adding around

100 to 200 beds each in Tier II and Tier III cities in India. Such facilities provide patients in these locations

2,200 beds to its existing base of 6,684 beds as of March 31, 2014. These new beds will be located in 12

improved access to high quality healthcare services and technology.

hospitals which, when added to the current network of 39 hospitals, will take the overall network to 51 hospitals.

We believe the service offerings provided by these facilities will be readily accepted by the population living in

The expansion has been chalked out in a calibrated manner with a manageable number of beds coming on

these locations. At the same time, it will help extend the Apollo Brand to all corners of the country. We have

stream each year. Further, the strategy behind the expansion is to augment its pan-India presence in a balanced

identified a number of Tier II and Tier III cities across the country that are currently under-served in of

manner. This will consist of expansion of beds and facilities in centres such as Chennai and Bangalore where

healthcare services but have a sizable population who are willing to spend on quality care. We believe we can set

it already has a considerable presence. This will help it to become the dominant healthcare provider in key

up high quality facilities at competitive costs to further our geographic reach to non-metros and smaller towns to

locations. We also plans to set up new hospitals in metros and large cities with no existing presence in order to

address the latent demand.

reach out to a wider urban population. Its current expansion plan envisages entry into Mumbai, Indore, Patna and Vishakapatnam amongst other locations.

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Apollo REACH Hospitals

Expansion Plans

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | The REACH model allows us to moderate the capital intensity when setting up a hospital. A reduced breakeven

Standalone Pharmacies

point allows operational flexibility. Further, these hospitals are located in smaller centres which are less populated

Your Company has been in the retail pharmacy business for the last 20 years. In the last 5 years there has been

and hence the footfalls and asset turnover is reduced. The volumes and case mix do not justify the investment

accelerated growth in the business. During this time, the network has expanded from around 350 stores to

into expensive and high-end equipment. However, the quality of care and visibility of the brand allows for a deep

1,632 stores currently. Through this journey there have several innovations by the company in of new store

connect with patients. As the market in these centres mature and these facilities develop, the specialties and

formats and introduction of value added services.

equipment phasing can be augmented in a calibrated manner.

bandage and dressing, blood pressure, etc are provided free of charge to our customers. We also introduced a

Bhubaneshwar and Karur. In FY14, it inaugurated REACH Hospitals in Vanagaram, a suburb of Chennai as well

service called ATM (Anytime medicine) – where patients can get priority delivery of medicines. Apart from this,

as Trichy. In the near term, more such hospitals will be launched in Nashik and Nellore. All of the REACH hospitals

we also launched a service known as compliance pack to help remind those patients who are prone to forgetting

have proven to be successful with healthy growth in volumes. The recently launched facilities in Chennai and

Corporate Review

Such value added services include the initiative of a ‘nurse station’ where we provide paramedic services like

Your Company has set up REACH hospitals in Tier II cities including Kakinada, Karaikudi, Karimnagar,

their medicine schedule.

Trichy are also witnessing good growth, we expect all the REACH Hospitals to become profitable and thereby add to the overall portfolio of the Company.

This has been accompanied by a change in the product mix through the introduction of wellness products as well as self-branded products. When we started our operations, we were primarily selling pharmaceutical products which have now evolved to include more wellness products. We find that for stores located in the vicinities of

Medical Tourism

residential areas, it is the wellness products that sell the most.

network, especially those in major urban centres such as Delhi, Chennai, Kolkata, Hyderabad, Bangalore and Ahmedabad handle large volumes of International patients.

We also tailor our product mix for each pharmacy. The product mix and display in pharmacies in the North will vary from those in the South. Apart from this, 40-45% of our business comes from loyal customers.

From our experience, the primary criteria evaluated by these international patients is the quality of care. These patients choose our facilities after evaluating our doctors and medical teams for their expertise in a particular

Each of our 1,632 outlets is looked at as a strategic business unit (SBU). We have a cluster analysis mechanism

specialty and measuring their track record and clinical success rates. The number of facilities in our network

and each cluster is managed by an independent manager. We have standardised our systems for tracking the

which enjoy a JCI accreditation also works in our favour.

viability of each store in of its real estate costs, supply chain, cost-benefit ratios and various other routine

Statutory Section

hospitals and clinics, prescription drugs for 75-80% of store turnover. Whereas in stores located near

Your Company has a well established track record of catering to international patients. Several hospitals in the

operating metrics for retail pharmacy.

The other factor that has a bearing on the decision to choose a particular facility is its accessibility. Cities like

The profitability profile of this business has improved steadily due to maturity of stores, increasing proportion

Bangalore and Ahmedabad have witnessed a sharp improvement in travel infrastructure over the last decade but

of private label products as well as rationalization of the store network through the discontinuation of unviable

are yet to scale up accessibility to the levels of the metro cities.

stores. Despite the DPCO order which impacted margins by around 1-2% across the pharmacy network, there has been an improvement in the operating margins during the year.

India is considered as a medical destination by many given the fact that Indian doctors are highly skilled and

Business Review

Delhi, Chennai and Mumbai benefit from their accessibility to International locations. Centres like Hyderabad,

regarded. India is being preferred for complex surgeries in the fields of cardiology, orthopaedics, neurology. Neighbouring countries such as Singapore, Thailand, Malaysia are able to attract patients for less critical ailments

Projects & Consultancy

such as cosmetic surgery. These countries also gain an advantage from friendly and conducive regulation

We provide comprehensive and services to the healthcare delivery industry including pre-commissioning

pertaining to medical visas as well as less onerous requirements for solid organ transplants.

consultancy services comprising feasibility studies, infrastructure planning as well as design & advisory services equipment planning, sourcing and installation services.

have significant number of patients from the Middle East and from Africa.

We also provide post-commissioning consultancy services, which include management contracts (providing

We expect continued strong growth in the volumes of international patients. We have set up touch points in the

day-to-day operational ), franchising and technical consultation including human resource planning and

form of clinics and telemedicine units. We are actively marketing our offerings by arranging medical camps and

training and the establishment of medical and istrative protocols. We provide these services to third party

consultation with specialists who themselves fly to these centres. This helps to build a connect with patients and

organizations globally for a fee.

is a key catalyst to make them choose Apollo over other service providers. We have also created separate blocks for International patients in several of our facilities which will have suites of international standards. The option of ‘visa on arrival’ for individuals of select nationalities at several airports across India is a step in the right

Apollo Health & Lifestyle Limited (AHLL)

direction. The impending launch of our hospitals in Mumbai in the next couple years is expected to further boost

AHLL is a wholly-owned subsidiary which houses our portfolio of retail healthcare businesses. Upto FY2010, we

our volumes of international patients given the connectivity that Mumbai enjoys with key international locations.

provided such services through franchised clinics but changed our business model from FY2011 to focus on self-owned clinics.

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(functional design and architecture review), human resource planning, recruitment and training and medical

Apollo enjoys a special standing as it has recently completed the 500th transplant on a Pakistani patient. We also

We believe that these clinics can act as a critical component of our integrated healthcare delivery model as they

Discussion on Consolidated Financial Performance and Results of Operations

help to bridge the gaps between our existing facilities / formats and the customer. They also provide strategic

The following table present summaries of results of operations for the years ended March 31, 2013 and 2014:

benefits such as expanding the reach of the brand, addressing new categories of patients, expanding patient touch points, helping to seed the market prior to launch of a hospital facility and easing the pressure on the OPD

31.03.2014

ward of the main hospital. Operating Revenues

enabling us to go to the customer rather than the other way around. Further, the ability to modify formats has

Add: Other Income

helped to enhance the patient experience. For example, our lifestyle birthing centres have bright interiors and are

Add: Profit on Sale of Equity

designed to celebrate a new life whereas hospital facilities are associated with disease and recovery and offer

31.03.2013

Amount

% of

Amount

% of

` in million

Income

` in million

Income

43,842

37,687

215

302

-

63

Corporate Review

Since these clinics are not resource intensive they can be set up in neighbourhoods and crowded urban areas

44,057

100

38,052

100.00

Operative Expenses

21,501

48.80

18,558

48.77

We have launched a variety of clinics addressing problems related to liver, sugar, knee pain, advanced fever, etc.

Salaries & Benefits

7,275

16.51

6,231

16.37

We have also rolled out 2 lifestyle birthing centers which are branded as ‘Cradle’. The rollout of Apollo White

istration & Other Expenses

8,342

18.94

6,815

17.91

Dental Spas has also picked up pace in FY14.

Financial Expenses

1,194

2.71

1,033

2.71

Depreciation & Amortization

1,678

3.81

1,424

3.74

Profit Before Income Tax

4,067

9.23

3,991

10.49

Provision for Taxation

1,018

2.31

1,051

2.76

Profit after Tax

3,049

6.92

2,940

7.73

(14)

(0.03)

(17)

(0.04)

3,063

6.95

2,957

7.77

104

0.24

87

0.23

3,167

7.19

3,044

8.00

As of March 31, 2014, we had a total of 100 clinics and we plan to add more clinics & cradles across the country over the next few years. Through our network of clinics, we aim to make quality healthcare services accessible to a larger cross-section of the Indian population. Our clinics are equipped to provide a wide range of healthcare services, from basic to advanced consultation and diagnostic tests. All of our clinics are equipped

Less: Minority Interest

with a pharmacy and some of our clinics also offer telemedicine facilities to provide access to specialist doctors

Profit After Minority Interest

in multiple locations.

Add: Share in Associates Profit After Share in Associates

Medical Insurance – Apollo Munich Health Insurance

Statutory Section

Total Income

limited design flexibility due to primary objectives of functionality and disease control.

Revenues

companies in the world. We believe there are significant synergies between our core healthcare services business,

The 16% change in our operating revenues for FY14 compared to FY13 was primarily the result of an increase in

retail pharmacies and the health insurance business.

occupancy and revenue per bed day (RPBD) for hospitals as well as strong growth in the SAP business. Health care services revenues grew by 18% from ` 25,617 million to ` 30,226 million. Revenue per Bed Day increased from ` 21,702 to ` 23,684. The increase in RPBD is largely a result of changes in the acuity of patients as well

s scaling up at a CAGR of over 30% during the period 2010-11 to 2013-14.

Business Review

We entered the health insurance market through a t venture with Munich Re – one of the leading insurance

The health insurance industry continues to report healthy growth rates and is expected to grow with gross

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

as better price realizations.

Apollo Munich was able to expand its gross written from ` 6,200 million in FY13 to ` 6,930 million in

The number of stores within the network of Standalone Pharmacies was 1,632 as at March 31, 2014 as compared

FY14. We have been able to grow ahead of industry growth rates and our insurance products are rated very

to 1,503 stores as at March 31, 2013. These rollouts together with maturity of existing stores led to a 24% yoy

highly by market participants. Further, we enjoy one of the best claims ratios in the industry and customer

revenue growth in the standalone pharmacy segment (SAPs).

customers. We had 52 branches across the country and assets under management stood at ` 6,530 million as

The following table shows the key drivers of our revenues for the periods presented:

on March 31, 2014.

Discharges (Nos.) Revenues per patient (`) Out-patients (Nos.) Revenue per bed day (`)

98

Year Ended

Increase

% Increase

31.03.2014

31.03.2013

(Decrease)

(Decrease)

331,678

313,348

18,330

6

88,710

84,025

4,685

6

4.54

4.65

(0.11)

2

2,943,610

2,647,819

295,791

11

23,684

21,702

1,982

9

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4

Consolidated Financials

Annual Report 2013–14

Average length of stay (days)

Year Ended

Standalone Financials

loyalty and retention is high as the introduction of health insurance portability has not resulted in net migration of

increase is largely due to higher interest charge arising on commissioning of new hospital projects at Chennai,

Expenses

Bengaluru and Trichy.

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Salaries & Benefits (excluding managerial remuneration) Our salaries and benefits expense of ` 5,865 million during 2013 increased by ` 1,053 million to ` 6,918 million

Provision For Income Taxes

in 2014. This increase was a result of annual compensation increases for our employees, plus the impact of an

The provision for taxes during the year ended March 31, 2014 is ` 1,018 million compared to ` 1,051 million in

increasing number of employed physicians within our hospitals and pharmacists for the SAPs. Year Ended

% of

Year Ended

% of

` Increase

% Increase

31.03.2014

Revenue

31.03.2013

Revenue

(Decrease)

(Decrease)

6,918

15.7

5,865

15.4

1,053

18.0

allows weighted deduction of 150% of project cost of new hospitals commissioned during the year.

Liquidity

benefits (excluding

Our primary sources of liquidity are cash flows generated from our operations as well as long-term borrowings.

managerial remuneration)

We believe that our internally generated cash flows, amounts available under our debt agreements and the further

(` in million) No. of employees

Corporate Review

Salaries, wages and

the previous year ended March 31, 2013 due to availing of benefit under section 35AD of the Income Tax Act that

35,883

33,018

2,865

debt that is proposed to be raised will be adequate to service existing debt, finance internal growth and deploy

8.7

funds for capital expenditure.

During 2014, our material cost of ` 21,501 million increased 16%, as compared to ` 18,558 million in 2013. The

Capital Expenditure

increase in material cost was in line with the growth in operating revenues.

As we continue to increase bed capacity and roll-out new hospitals, capital expenditures continue to be high. We have made significant, targeted investments at our hospitals to add new technologies, modernize facilities and

The following table summarizes our operating and istrative expenses for the periods presented Year Ended

% of

Year Ended

% of

`Increase

31.03.2014

Revenue

31.03.2013

Revenue

(Decrease)

` in million

` in million

expand our services. These investments should assist in our efforts to attract and retain physicians and to make Increase

952

2.50

205

21.6

Rents and leases

1,309

2.97

1,139

2.99

170

14.9

822

1.87

633

1.66

189

29.9

(` in million) 2013 - 2014

2012 - 2013

Cash and cash equivalents at beginning of the year

3,200.64

2,368.38

3,733.89

4,427.52

1,152

2.61

889

2.34

263

29.6

Net cash from operating activities

412

0.94

429

1.13

(17)

(3.9)

Net cash used in Investing activities

fees

(3,558.28)

(7,325.19)

Net cash from financing activities

(634.77)

3,729.93

(459.17)

832.26

2,741.47

3,200.64

Rates & taxes

279

0.63

104

0.27

175

168.0

Net increase in cash and cash equivalents

Provision for doubtful

204

0.46

174

0.46

30

17.5

Cash and cash equivalents at the end of the year

Other operating expenses

3,007

6.82

2,495

6.56

512

20.5

Total

8,342

18.9

6,815

17.91

1,527

22.4

Business Review

2.63

Legal and professional

Summary of Cash flow statement is given below

(Decrease)

1,157

Marketing and advertising

our hospitals more desirable to our employees and potential patients.

%

Repairs and maintenance Outsourcing expenses

Statutory Section

Operative Expenses

debts & Bad debts

Cash Flow From Operating Activities Net cash of ` 3,734 million was generated from operating activities by the Company in FY14 compared to ` 4,428 million in FY13. (` in million)

Our depreciation & amortization expense increased to ` 1,678 million during 2014, as compared to ` 1,424

Operating profit before working capital changes

million during 2013. The increase is largely due to capital improvement projects completed during 2013 and

Effect of working capital changes

normal replacement costs of facilities and equipment.

Foreign Exchange gain / loss Cash generation from operations Taxes paid

Financial Expenses

Net cash provided by operating activities

Our financial expenses increased to ` 1,194 million during 2014, compared to ` 1,033 million during 2013. The

100

2013 - 2014

2012 - 2013

6,966.90

6,254.72

(2,140.45)

(898.88)

11.21

(0.90)

4,826.45

5,417.88

(1,103.77)

(927.42)

3,733.89

4,427.52

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Consolidated Financials

Annual Report 2013–14

Depreciation & Amortization

Standalone Financials

written off

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | The risks that may affect the functioning of the Company include, but are not limited to:

Cash Flow From Investing Activities (` in million) 2012 - 2013

(5,958.42)

(6,600.08)

2,302.18

(1,071.14)

97.96

283.08

Others

-

(0.04)

Sale of AHSL equity (Extraordinary Item)

-

62.95

(3,558.28)

(7,325.19)

Purchase of fixed assets Sale / (Purchase) of investments Interest and Dividend received

Net cash used in investing activities

Competitive intensity and new entrants to the market;

•

Pace of obsolescence of technology and treatment methods;

•

Inflationary pressures and other factors affecting demand for our products;

•

Increasing costs of materials, transport and storage;

•

Labour shortages and attrition of key staff including medical professionals;

•

Increased compliance and regulatory challenges;

Corporate Review

2013 - 2014

•

Net cash used in investing activities includes capital expenditure on new hospitals projects and upgradation of existing facilities. The short term investments in mutual funds were redeemed partly during the year to finance

Your Company has a defined Risk Management Model to identify potential risks, treatment and monitor the

the projects.

occurrence of risk. Risk Identification: Monitoring and identification of risks is carried out at regular intervals with a view to improve existing processes and procedures. This assessment is based on risk perception survey, business environment scanning and inputs from shareholders.

(` in million) 2013 - 2014

2012 - 2013

72.45

1,631.40

2,321.79

5,934.74

Repayment of finance/lease liabilities

(1,060.03)

(2,247.20)

Interest and Dividend paid

(1,968.99)

(1,589.00)

(634.77)

3,729.93

Issues from share capital Proceeds from Borrowings

Net cash from financing activities

Risk measurement and treatment: After risks have been identified, risk mitigation and solutions are defined in order to bring risk exposure levels in-line with the risk appetite.

Statutory Section

Cash Flow From Financing Activities

Risk reporting: We have an established Risk Council to deal with any reported risks. In addition, a quarterly risk report is presented to our Risk Management Committee, which reviews the Enterprise Risk Management program to assess its efficacy to manage the risk.

Cash provided by financing activities in FY14 resulted primarily from loans availed from bankers and financial

Internal Controls

paid interest and dividend of ` 1,969 million in FY14.

Your Company and its subsidiaries have established a wide-ranging system of Internal Controls to ensure that all assets are safeguarded and protected. Further, it has processes in place to ensure that all transactions are evaluated, authorized, recorded and reported accurately.

Risk Management & Internal Controls

Business Review

institutions. We used part of the proceeds from financing activities to repay loans of ` 1,060 million in FY14. We

Your Company has also put in place an extensive budgetary control review mechanism whereby the management

Risk Management

regularly reviews actual performance in comparison to forecasts. Any significant deviation from forecasts is

As your Company expands the scale of operations to include a large number of hospitals, primary healthcare

reviewed and assessed rapidly to identify any market trends or shortcomings in service offerings.

facilities, pharmacies and retail healthcare touch points and widens its network to reach out to patients from all

preparing financial information and other data. The internal control procedures are augmented by an extensive

management system has been implemented to ensure that risks are contained within manageable levels.

programme of internal, external audits and periodic reviews by the management.

A Risk Management Committee headed by the Managing Director has been constituted which will identify, assess, prioritize, manage, monitor and communicate suitable measures to manage such risks. The executive management team reports to the Board of Directors periodically on the assessment and minimization of such

Human Resources

risks.

Successful companies across the world are recognized by their people and the innovations they bring to bear.

Standalone Financials

The system is designed to adequately ensure that financial and other records are accurate and reliable for

corners of the globe, it is aware that it is being exposed to an increasing degree of risk. A comprehensive risk

2013 -14 too witnessed numerous initiatives and endeavours purpose-designed to enhance the company’s

cash flows, financial performance, management performance and overall sustainability of the Company.

people capital.

102

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Consolidated Financials

Annual Report 2013–14

This ethos has always underlined the human resource agenda at Apollo Hospitals and hence the financial year These risks can adversely impact the functioning of the Company through their effect on operating performance,

New were brought into the Apollo family fold to resource the new hospitals opened in Chennai, Bangalore

Recognition is said to be the greatest motivator and bearing this in mind, over the years, Apollo had introduced

and Trichy. As of 31st March, 2014 we had a total employee strength of 35,878 (including employees of our

several innovative felicitation programs for employees. This year, the spot reward entitled “I Made a Difference”

subsidiaries, t ventures and associates). A keen focus to connect people and performance witnessed the

was introduced and was received very favourably by all in the workforce. Cohesive team work within teams

introduction of ‘Apollo Big Minds’ - An Employee suggestion scheme which encourages employees to contribute

across business verticals was incentivised with a monetary reward program.

ideas for improvement. A study by NPC (National Productivity Council) was implemented to help assess optimum

Apollo emerged as a recipient of numerous prestigious Indian and international awards as follows:

manpower required for smooth running of the hospital network.

Apollo Future Leadership Program

•

Sojo Koka - A soft skill development programme for all our Consultants & other doctors

•

Competency Coaching Program for the Nursing Leaders

•

Leadership Development program for all CXO’s and Business Heads by PwC

•

Apollo Hospitals was the winner of the prestigious SKOCH ORDER-OF-MERIT Award for Best On-Boarding Solutions for the year 2013.

•

Voice of Customer Methodology that was put into practice has been awarded in the category as “Breakthrough Innovation in Service Delivery” by the All India Management Association and has been listed amongst the

Corporate Review

•

Significant strides were taken in rolling out training & development initiatives such as the implementation of: •

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

top 30 innovations of the country in 2013. It has also been recognized in the Hospital Management Awards Forum in Bangkok as the “Best Innovation in Operational Excellence”. •

Apollo Hospitals has been awarded by Asian Learning & Development Leadership Awards in two categories

Brand Wealth, GAMP, IIM Trichy, NHRD and World HRD Congress

Health Care. •

Employee engagement was a keen focus area and the success of the programs introduced over the year across the group was reflected in the high engagement scores in both the employee and consultant surveys undertaken.

Apollo Hospitals won the Asia HRD Awards 2013 for Contribution by HR to an Organisation in Jakarta.

Above all in an effort to improve employee morale and happiness, a new HR service delivery format was adopted

We adopted the Human Sigma wherein we used Employee Engagement to drive Customer Engagement leading to

Statutory Section

Nomination of Apollo Mid and Senior Leadership Resources to various External Training Programs like AIMA,

namely The Best Customer Service Training program in an organization and The Best Training Initiative in

and the human resources team is steadfast in the pursuit to make the organization, one amongst the globally

growth in business results. We partnered with Gallup worldwide to measure Customer & Employee Engagement.

preferred employers.

In the first wave of engagement we have been listed in the top 30 companies to work for in the World. The strategic focus also encouraged employee across the group to put forth abundant suggestions for initiatives that

Cautionary Statement

led to significant saving in costs.

projections, estimates, expectations and predictions may be ‘forward looking statements’ within the meaning of

measure more to manage better, gained greater significance and in keeping with this development, the senior

applicable laws and regulations. Actual results may differ from those expressed or implied. Important developments

management appraisal process was reviewed and re-engineered to be more holistic and have a stronger linkage

that could alter your Company’s performance include increase in material costs, technology developments and

to business performance.

Business Review

Some of the statements in this Management Discussion & Analysis, describing the Company’s objectives,

In a business environment becoming more globally integrated and competitive than ever before, the need to

significant changes in political and economic environment, tax laws and labour relations.

A positive trend observed this year was that manpower attrition decreased on a year on year basis by 2%. The organizational values system reinforced across the Group resulted in enhanced patient centric behaviours driving up the service excellence parameters to new heights. The Voice of Customer (VoC) methodology that was created is an integrated system that captures customer voice from all touch points and provides early warnings

Standalone Financials

and direction for our success, directly from people who really matter; our customers. This has won several laurels in domestic and international forums. It is said that technology is integral to an innovation ecosystem and investment into an enterprise-wide Oracle Fusion HCM as the HRMS Solution was made for the entire group. A transformational tool, it will be harnessed to drive value to the business by creating a modern employee experience and by providing real time employee

The tenets of ion, Purpose, People and Profits in the journey of healing were amplified across the organization and in addition several path breaking policies were also introduced. A specific emphasis was laid out on ‘Protection against Sexual Harassment and Safety of Woman at the Workplace.’ A greater impetus to recruitment from premier business schools led to young managers coming on board across the group businesses.

104

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Consolidated Financials

Annual Report 2013–14

data for decision makers.

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Education & Training

Clinical Governance

Basic Life Training was imparted to all employees at Apollo Hospitals, Chennai. Regular training classes were conducted to train them on R and other life saving techniques. Newly ed Consultants of Apollo Hospitals Group were oriented on JCIA standards, Organizational and Departmental requisites.

Corporate Review

Achievements

Clinical Governance at Apollo Hospitals, is a framework that s a systematic, sustained approach to quality improvement. It encomes all the systems and processes that ensure safe and effective care delivery.

Personalized health Check-up (PHC)

Clinical Governance plays a guiding role in improving the standard of clinical practice, while upholding the

Over the last 3 decades we have the accumulated experience of having conducted more than 8 million health checks – the

commitment to maintain and improve the quality of care provided to our patients by our clinicians – care that is

highest in the world. This experience combined with our expertise and certified processes give us the ability to create an

able, systematic and sustainable. The Clinical Governance at Apollo Hospitals, Chennai signals, s

Apollo Personalized Health Check that is so accurate, with results that anyone can trust.

and strengthens initiatives to enable the hospital in providing quality healthcare in a safe, friendly, healing and

The Personalized Health Check will suggest clinical tests to an individual only based on inference from an initial

holistic environment.

bring in genetic profiling component into the personalized health check which will be an adjunct the health check and

safety in the clinical delivery through patient , clinical audit and review and tracking of clinical outcomes.

help you modify your lifestyle for a better tomorrow. We at Apollo believe in taking care of our customers even after

Policies and improvement processes are then implemented which will foster good practices in contributing

they leave our hospitals: you get a free insurance cover for one year if you ‘’ our health check.

towards best outcomes for patients.

Clinical Audit

Apollo Hospitals, Chennai performed the first simultaneous Kidney-Pancreas transplant in South India

ACAT (Apollo Clinical Audit Team) from 33 locations constituting 17 auditors went across the Apollo Hospitals

A team of surgeons led by a transplant surgeon operated on a 52-year old diabetic patient with kidney failure at

ecosystem for auditing ACE @ 25 parameters. Parameters performances, data collection methodology, key

Apollo Hospitals, Chennai. Reportedly, this is the first to be held in South India. Simultaneous kidney pancreas transplant is an operation to place the kidney and pancreas at the same time in a patient who has kidney failure and also suffers from diabetes, needing very high insulin dose to control

Apollo’s Safe Surgery Initiative

sugars. Diabetic patients with kidney failure need a kidney transplant to prolong their life. Steroids used as

Apollo Hospitals, Chennai has implemented a customized version of the WHO Surgical Safety Checklist in all the

immunosuppressant’s make treatment of diabetes difficult and poorly controlled sugar levels will continue to affect

operating rooms, in conjunction with a Checklist introduction program for anesthetists, or staff, and surgeons.

the rest of the body including the transplanted kidney. However, performing a pancreas transplant eliminates

This initiative aims to decrease the likelihood that patients undergoing surgery in our hospitals will suffer from

these problems by optimally controlling sugar levels and protect the transplanted kidney from future effects

preventable complications. The WHO Surgical Safety Checklist was originally studied in an eight center multi-

of diabetes. Additionally, it will also help reverse the effects of diabetes on other systems including peripheral

country pilot study and the results were published in the January 2009 New England Journal of Medicine Article,

neuropathy thus protecting the limbs.

Standalone Financials

A Surgical Safety Checklist to Reduce Morbidity and Mortality in a Global Population. The use of the checklist

Business Review

efforts for ACE were reviewed and reports were submitted to respective locations for further improvement.

Statutory Section

thorough physical and clinical examination performed by our experienced and renowned clinical team. We will soon

Clinical departments are constantly reviewed to identify variances that impact adversely on patient care and

reduced the rate of deaths and complications by more than one-third.

Annual Performance Review for Clinical Parameters An Annual review of performance of all clinical specialties was held during February 2014. Each department presented its OP/IP statistics, procedures/surgeries done, complications, Quality indicators, best practices, paper presentations,

106

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Consolidated Financials

Annual Report 2013–14

affiliations and future plans.

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Independent Auditors’ Report

Opinion

To the of Apollo Hospitals Enterprise Limited

view in conformity with the ing principles generally accepted in India:

In our opinion, and to the best of our information and according to the explanations given to us, the accompanying financial statements give the information required by the Act in the manner so required and give a true and fair

a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2014;

Corporate Review

b) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and

Report on the Financial Statements

c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

We have audited the accompanying financial statements of Apollo Hospitals Enterprise Limited (the company), which comprise the Balance Sheet as at March 31, 2014, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant ing policies and other explanatory

Report on other Legal and Regulatory Requirements

information, which we have signed under reference to this report.

1. As required by the Companies (Auditor’s Report) Order, 2003, as amended by the Companies (Auditor’s Report ) (Amendment) Order, 2004 issued by the Central Government of India in of section 227(4A) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order. 2. As required by section 227(3) of the Act, we report that:

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the ing



Standards referred under the Companies Act, 1956 (the Act) read with the General Circular 15/2013 dated

a) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

September 13, 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013.

This responsibility includes the design, implementation and maintenance of internal controls relevant to the

Statutory Section

Management’s Responsibility for the Financial Statements

b) in our opinion proper books of as required by law have been kept by the Company so far as appears from our examination of those

preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.



c) The Balance Sheet, Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of .



Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our

d) in our opinion, the Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with ing Standards notified under the Act read with the General Circular 15/2013 dated

audit in accordance with the Standards on Auditing issued by the Institute of Chartered ants of India.

13 September, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act,

Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain

2013

reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence, about the amounts and disclosures in the

e) on the basis of written representations received from the directors as on March 31, 2014, taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2014, from being

financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of

appointed as a director in of clause (g) of sub-section (1) of section 274 of the Act

the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk

f) Since the Central Government has not issued any notification as to the rate at which the cess is to be

of the financial statements in order to design audit procedures that are appropriate in the circumstances, but

paid under section 441A of the Companies Act,1956 nor has it issued any Rules under the said section,

not for the purpose of expressing an opinion on the effectiveness of the entity’s internal controls. An audit also

prescribing the manner in which such cess is to be paid,no cess is due and payable by the Company.

includes evaluating the appropriateness of ing policies used and the reasonableness of the ing estimates made by Management, as well as evaluating the overall presentation of the financial statements. New No. 17, Bishop Wallers Avenue (West),

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit

Mylapore, Chennai – 600 004

opinion.



Place: Chennai Date :28th May 2014

108

For M/s S Viswanathan Chartered ants FRN : 004770S V C Krishnan Partner hip No: 022167

109

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Consolidated Financials



Standalone Financials



assessments, the auditor considers internal controls relevant to the Company’s preparation and fair presentation

Annual Report 2013–14

Business Review

Auditor’s Responsibility

4. In our opinion and according to the information and explanations given to us, and having regard to the

Annexure to the Independent Auditors’ Report

explanation that some of the items purchased are of special nature and suitable alternatives sources do

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

not exists for obtaining comparable quotations, there is generally an adequate internal control procedure commensurate with the size of the company and the nature of its business, for the purchase of stores, medicines and fixed assets for sale of goods and services. During the course of our audit, we have not observed any major weaknesses in the internal control system.

by the Management, the particulars of contracts or arrangements referred to in section 301 of the Act

The Annexure referred to in paragraph 1 of the Our Report of even date to the of Apollo Hospitals

have been entered in the required to be maintained under that section.

Enterprise Limited. On the s of the company for the year ended March 31, 2014.

On the basis of such checks as we considered appropriate and according to the information and explanation

regard to the prevailing market prices.

1. (a) The company is maintaining proper records showing full particulars including quantitative details and

6. In our opinion and according to the information and explanations given to us, the Company has complied

situation of its fixed assets.

with the directives issued by the Reserve Bank of India and provisions of Section 58A, Section 58AA and

(b) The company has a program of physical verification of its fixed assets by which all fixed assets are verified

other relevant provisions of the Companies Act, 1956 and Companies (Acceptance of Deposits) Rules,

in a phased manner over a period of three years. In our opinion, this periodicity of physical verification

1975 with regard to the deposits accepted from the public including unclaimed deposits matured in earlier

is reasonable having regard to the size of the company and the nature of its assets. According to the

years that are outstanding during the year. To the best of our knowledge and according to the information

information and explanations given to us, no material discrepancies were observed by the Management

and explanations given to us, no order has been ed by the Company Law Board, National Company

on such verification.

Law Tribunal or Reserve Bank of India or any Court or any other Tribunal on the Company in respect of the aforesaid deposits.

(c) In our opinion and according to the information and explanations given to us, the fixed assets that have been sold/disposed off during the year do not constitute a substantial part of the total fixed assets of the

7.

company. Hence, the going concern assumption has not been affected.

8. According to the information and explanations given to us, the Central Government has not prescribed the maintenance of cost records under Section 209(1) (d) of the Companies Act, 1956 for any of the activities of

(b) In our opinion and according to the information and explanations given to us, the procedures of physical

the Company.

verification of stock of medicines, stores, spares, consumables, chemicals, lab materials and surgical instruments followed by the Management are reasonable and adequate in relation to the size of the

9. (a) According to the information and explanations given to us, the Company is regular in depositing with

company and the nature of its business.

appropriate authorities undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees’ State Insurance, Income Tax, Sales Tax, Service tax, Customs Duty, Cess,

(c) In our opinion and on the basis of our examination of the records, the Company is generally maintaining

Wealth Tax and other statutory dues applicable to it. To the best of our knowledge and according to the information and explanations given to us, there are no arrears of outstanding statutory dues as at March

by the Management as compared to book records.

31, 2014 for a period of more than six months from the date they became payable. To the best of our knowledge and belief and according to the information and explanations given to us, excise duty is not

3. (a) According to the information and explanations given to us and on the basis of our examination of the

applicable to this Company.

books of , the Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the maintained under Section 301 of the Companies Act, 1956.



Consequently, the provisions of clauses 3 (b), 3(c) and 3 (d) of the order are not applicable to the

(b) According to the information and explanations given to us and the records of the company examined by us, there are no dues disputed with respect to Cess, Wealth Tax and Service tax. The particulars of

Company.

Sales tax, Customs duty and Income tax which have not been deposited on of any dispute are as follows:

(b) According to the information and explanations given to us and on the basis of our examination of the books of , the Company has not taken loans from companies, firms or other parties listed in the maintained under Section 301 of the Companies Act, 1956. Consequently, the requirements of clauses (iii) (f) & (iii) (g) of paragraph 4 of the Order are not applicable.

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Consolidated Financials

Annual Report 2013–14

Standalone Financials

proper records of its inventories. No material discrepancy was noticed on physical verification of stocks



Business Review

in our opinion, the internal audit system is reasonable having regard to the size and nature of its business.

have been physically verified at reasonable intervals by the Management.



The Company has firms of Chartered ants, including a Private Limited Company as Internal Auditors for its various divisions and pharmacies. On the basis of the reports submitted by them to the Management,

2. (a) Stock of medicines, stores, spares, consumables, chemicals, lab materials and surgical instruments



Statutory Section



b) In our opinion and according to the information and explanations given to us the transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable, having

given to us during the course of our audit, we report that:



Corporate Review

5. a) Based on the audit procedures applied by us and according to the information and explanations provided

Name of the statute

Nature of the dues

Amount (` in million) 31.03.2014

Period to which the amount relates

Forum where dispute is pending

Andhra Pradesh General Sales Tax

Sales tax

0.52

Assessment Years 2001-02 & 2002-03

@ Appellate Tribunal Hyderabad

Customs Act, 1962

Customs duty

99.70

1996,1997

# Assistant Collector of Customs ( Chennai, Hyderabad & Customs duty)

Value Added Tax Act, 2004

Service tax Value Added Tax

20.82 2.27

that proper records have been maintained of the transactions and contracts relating to shares, securities, debentures and other investments dealt in by the Company and timely entries have been made in the

2013-14

CESTAT, Delhi

2008-09,

##Deputy Commissioner of Commercial Tax (Enforcement), Chennai

2009-10, 2010-11

records. We also report that the Company has held and dealt with shares, securities, debentures and other investments in its own name. 15. In our opinion and according to the information and explanations given to us, the Company has given guarantees for loans taken by t Venture Companies, subsidiaries, from banks and financial institutions, the and conditions whereof are not prejudicial to the interest of the Company. 16. In our opinion and according to the information and explanations given to us, the Company has availed term loans and the said term loans have been used for the purpose for which the term loans have been obtained.

Assessment Year 66.72

2008-2009

38.95

Assessment Year

funds raised on short term basis for long term investments.

Department has filed appeal before Madras High Court

18. During the year the Company has not made any preferential allotment of shares to parties and Companies covered in the maintained under section 301 of the Companies Act 1956 and hence Clause 4(xviii)

1999-2000,

of the Companies (Auditor’s Report) Order, 2003, as amended by the Companies (Auditor’s

2000-2001 Income Tax Act, 1961

(Amendment) Order, 2004 is not applicable to the Company.

2001-2002

Income Tax 94.14

Assessment Year

CIT (Appeals)

19. During the year the Company has not issued any debentures and hence Clause 4(xix) of the Companies

2010-2011

(Auditor’s Report) Order, 2003, as amended by the Companies (Auditor’s Report) ( Amendment) Order, 2004

2011-2012

is not applicable to the Company.

136.76

Assessment Year 2000-2001

@@Honourable Supreme Court

0.16

Assessment Year 2009-2010, 20102011 & 2011-12

CIT (Appeals)

20. During the year the Management has not raised money through public issue and hence Clause 4(xx) of the Companies (Auditor’s Report) Order, 2003, as amended by the Companies (Auditor’s Report) ( Amendment) Order, 2004 is not applicable to the Company.

336.73

21. According to the information and explanations given to us, by the Company, no fraud on or by the Company has been noticed or reported, during the year.

@ refer clause (i) (c) Note 28 - Notes forming part of s

Business Review

TOTAL

Report)

Statutory Section

1996-1997,

17. In our opinion and according to the information and explanations given to us, the Company has not used any

Department has gone on appeal to ITAT

2009-2010

Corporate Review

Service Tax

14. Based on our examination of the records and evaluation of the related internal controls, we are of the opinion

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

@@ refer clause (i) (c) Note 28 - Notes forming part of s # refer clause (i) (c) Note 28 - Notes forming part of s ## refer clause (i) (c) Note 28 - Notes forming part of s

New No. 17, Bishop Wallers Avenue (West),

10. In our opinion and according to the information and explanations given to us, the Company has no

Mylapore, Chennai – 600 004

accumulated losses as at March 31, 2014. The Company has also not incurred cash losses in such financial

11. In our opinion and according to the information and explanations given to us, the Company has not defaulted



in repayment of any dues to financial institutions, banks and debenture holders.

Place: Chennai Date :28th May 2014

12. In our opinion and according to the information and explanations given to us, the Company has not granted

Chartered ants FRN : 004770S V C Krishnan Partner hip No: 022167

Standalone Financials



year and in the immediately preceding financial year.

For M/s S Viswanathan

13. In our opinion and according to the information and explanations given to us, the Company is not a Chit Fund, Nidhi, Mutual Benefit Fund or Society and hence Clause (xiii) of the Companies (Auditor’s Report) Order, 2003, is not applicable to the Company.

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Consolidated Financials

Annual Report 2013–14

any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Balance Sheet

Statement of Profit & Loss

As at 31st March 2014

for the year ended 31st March 2014 (` in million)

(` in million) I.

31.03.2014

31.03.2013 I. II.

2 3

695.63 28,951.62

695.63 26,580.34

4 5 6

10,052.40 3,288.58 27.58

8,787.77 2,394.11 37.65

7 8 9 10

159.30 2,487.23 1,587.21 1,316.35 48,565.90

189.28 1,763.42 1,941.34 1,154.35 43,543.89

III.

IV.

19,759.12 127.88 4,635.73 173.85

X.

value of ` 5 Each Before Extraordinary Item Basic (in `) Diluted (in `) After Extraordinary Item Basic (in `) Diluted (in `) Notes Forming Part of s

16,774.72 140.41 3,579.23 148.07

5,417.61 4,876.08

5,254.50 3,227.58

16 17 18 19 20 21

1,482.67 2,649.74 4,684.51 2,088.98 2,489.34 180.39 48,565.90

3,705.85 2,053.88 4,266.09 2,554.66 1,685.81 153.09 43,543.89

24

25 26 27

5

31.03.2014 38,616.31 224.57 38,840.88

31.03.2013 33,177.91 310.27 33,488.18

9,516.01 10,962.79 (459.87) 6,102.23 870.68 1,290.78 6,356.58 34,639.20 4,201.68

8,642.58 8,639.91 (84.26) 5,243.99 726.25 1,085.20 5,200.16 29,453.83 4,034.35

4,201.68

45.45 4,079.80

833.27 (833.27) 894.48 3,307.20

798.37 (502.92) 295.45 693.26 3,091.08

23.77 23.77

22.10 21.89

23.77 23.77

22.43 22.22

1-43

* Represents profit on sale of the Company’s equity investment in Apollo Health Street Limited

1-43

* includes a portion of long term borrowings of ` 582.91 million payable within the next 12 months. For and on behalf of the Board of Directors

As per our Report annexed

For M/s. S. Viswanathan Chartered ants Firm Registration No. 004770S

Krishnan Akhileswaran Chief Financial Officer

Dr. Prathap C Reddy Executive Chairman

For M/s. S. Viswanathan Chartered ants Firm Registration No. 004770S

Krishnan Akhileswaran Chief Financial Officer

Dr. Prathap C Reddy Executive Chairman

V C Krishnan Partner (hip No. 022167) 17, Bishop Wallers Avenue West Mylapore, Chennai - 600 004

S M Krishnan Sr. General Manager - Finance & Company Secretary

Preetha Reddy Managing Director

S M Krishnan Sr. General Manager - Finance & Company Secretary

Preetha Reddy Managing Director



Suneeta Reddy t Managing Director

V C Krishnan Partner (hip No. 022167) 17, Bishop Wallers Avenue West Mylapore, Chennai - 600 004



Suneeta Reddy t Managing Director

Place : Chennai Date : 28th May 2014

For and on behalf of the Board of Directors

Place : Chennai Date : 28th May 2014

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Consolidated Financials

Annual Report 2013–14

As per our Report annexed

Standalone Financials

14 15

Note 22 23

Business Review

VIII. IX.

extraordinary items and tax Extraordinary Items * Profit before tax Tax expense (a) Current Tax ( Mat ) (b) Less: Mat Credit Entitlement (c) Net Current Tax (d) Deferred Tax Profit / (Loss) for the period Earnings per equity share of face

V. VI. VII. 11 12 13

Particulars Revenue from operations Other income Total Expenses (a) Cost of Materials Consumed during the Year (b) Puchase of Stock-in-Trade (c ) Changes in Inventories of Stock-in-Trade (d) Employee Benefits Expense (e) Finance Costs (f) Depreciation and Amortization Expense (g) Other Expenses Total Profit before exceptional and

Statutory Section

III.

Development (b) Non-Current Investments (c) Long-Term Loans and Advances 2 Current Assets (a) Current Investments (b) Inventories (c) Trade Receivables (d) Cash and Cash Equivalents (e) Short-Term Loans and Advances (f) Other Current Assets TOTAL Notes Forming Part of s

Note

Corporate Review

II.

Particulars EQUITY AND LIABILITIES Shareholders’ funds 1 (a) Share Capital (b) Reserves and Surplus Non-current liabilities 2 (a) Long-term Borrowings (b) Deferred tax Liabilities (Net) (c) Other Long term Liabilities Current liabilities 3 (a) Short-term Borrowings (b) Trade Payables (c) Other Current Liabilities* (d) Short-term Provisions TOTAL ASSETS Non-Current Assets 1 (A) Fixed Assets (I) Tangible Assets (Ii) Intangible Assets (Iii) Capital Work-in-Progress (Iv) Intangible Assets Under



Notes Forming Part of s

b. On assets installed prior to 2nd April 1987 on straight-line method at the rates equivalent to the Income Tax rates.



Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

ii. Depreciation on new assets acquired during the year is provided at the rates applicable from the date of acquisition to the end of the financial year.



Corporate Review

1. Significant ing Policies

iii. In respect of the assets sold during the year, depreciation is provided from the beginning of the year till the date of its disposal.

A. Basis of Preparation of Financial Statements



The financial statements are prepared under the historical cost convention under accrual method of ing and as

v. Amortization:

a going concern, in accordance with the Generally Accepted ing Principles (GAAP) prevalent in India and the



Mandatory ing Standards as notified under the Companies (ing Standards) Rules, 2006 and according

iv. Individual assets acquired for ` 5,000/- and below are fully depreciated in the year of acquisition.

a. The cost/ of land and building taken on lease by the Company from Orient Hospital, Madurai will be amortised over a period of 30 years though the lease is for a period of 60 years.

to the provisions of the Companies Act, 1956.

B. Inventories

The cost/ of land and building taken additionally on lease by the Company at Madurai is for a period of 9 years with an option to extend the lease by another 16 years. The depreciation on the leasehold building is charged on a straight line basis with the lease period being considered as 25

In the absence of any further estimated costs of completion and estimated costs necessary to make the

years.

sale, the Net Realisable Value is not applicable. Cost of these inventories comprises of all costs of purchase

and other costs incurred in bringing the inventories to their present location after adjusting for VAT wherever

The Company has taken land in Karaikudi from Apollo Hospitals Educational Trust on lease for a period of 30 years. The building constructed on the lease land is amortised over a period of 30 years.

applicable, applying the FIFO method.

2. Stock of provisions, stores (including lab materials and other consumables), stationeries and housekeeping

This is in conformity with the definition of lease term as per Clause 3 of AS 19 ‘Leases’ as notified under the Companies (ing Standards) Rules, 2006.

items are stated at cost. The net realisable value is not applicable in the absence of any further modification/ alteration before being consumed in-house only. Cost of these inventories comprises of all costs of purchase



and other costs incurred in bringing the inventories to their present location, after adjusting for VAT wherever

b. Lease rental on operating leases is recognised as an expense in the Statement of Profit and Loss ‘Leases’ as notified under the Companies (ing Standards) Rules, 2006.

3. Surgical instruments, linen, crockery and cutlery are valued at cost and are subject to 1/3rd write off wherever applicable applying FIFO method. The net realisable value is not applicable in the absence of any further

E. Revenue Recognition

modification/alteration before being consumed in-house. Cost of these inventories comprises of all costs of

a. Income from Healthcare Services is recognised on completed service contract method. The hospital

purchase and other costs incurred in bringing the inventories to their present location.

collections of the Company are net of discounts. Revenue also includes the value of services rendered pending final billing in respect of in-patients undergoing treatment as on 31st March 2014.

4. Imported inventories are ed for at the applicable exchange rates prevailing on the date of the transaction.

b. Pharmacy Sales are recognised when the risk and reward of ownership is ed to the customer and are

C. Prior Period Items and Extraordinary Items

c. Hospital Project Consultancy income is recognised as and when it becomes due, on percentage completion

Prior period items and extraordinary items are separately classified, identified and dealt with as required under ing

method, on achievement of milestones.

under the Companies (ing Standards) Rules, 2006

d. Income from Treasury Operations is recognised on receipt or accrual basis whichever is earlier.

D. Depreciation and Amortisation

e. Interest income is recognised on a time proportion basis taking into the principal amount outstanding



and the rate applicable.

Depreciation has been provided f.

a. On assets installed after 1st April, 1987 on straight line method at rates specified in Schedule XIV of the Companies Act, 1956 on single shift basis.

Royalty income is recognised on an accrual basis in accordance with the of the relevant agreement.

g. Dividend income is recognised as and when the owner’s right to receive payment is established.

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Annual Report 2013–14

Standard 5 on ‘Net Profit or Loss for the Period, Prior Period Items and Changes in ing Policies’ as notified

Standalone Financials

stated net of returns, discounts and exclusive of VAT wherever applicable.

i.

Business Review

on straight-line basis as per the of the agreement in accordance with ing Standard 19

applicable applying FIFO method.



Statutory Section

1. The inventories of all medicines, medicare items traded and dealt with by the Company are valued at cost.

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

F. Fixed Assets



a. All Fixed Assets are stated at their original cost of acquisition less accumulated depreciation and impairment



i.



ii. The face value of the foreign investments is shown at the face value reflected in the foreign currency

losses are recognised where necessary (Also refer Note 1(O) in the Notes forming part of s). Additional costs relating to the acquisition and installation of fixed assets are capitalised. Wherever VAT is eligible for

d. In case of foreign investments, The cost is the rupee value of the foreign currency on the date of investment.

of that country.

input availment, Fixed Assets are stated at cost of acquisition after deduction of input VAT.

that are not yet ready for their intended use at the Balance Sheet Date. Expenditure during construction

Short-term employee benefits (benefits which are payable within twelve months after the end of the period in which the

period directly attributable to the projects under implementation is included under Capital work- in –progress,

employees render service) are measured at cost.

pending allocation to the assets. Advances paid to acquire fixed assets is included under long term loans

Long-term employee benefits (benefits which are payable after the end of twelve months from the end of the period

and advances as per revised Schedule VI.

in which employees render service), and post employment benefits (benefits which are payable after completion of

c. Assets acquired under Hire Purchase agreements are capitalised to the extent of principal value, while

employment), are measured on a discounted basis by the Projected Unit Credit Method, on the basis of annual third

finance charges are charged to revenue on accrual basis.

party actuarial valuations.

d. Interest on borrowings, for acquisition of Fixed Assets and exchange fluctuation arising out of foreign

Defined Contribution Plan The Company makes contribution towards Provident Fund and Employees State Insurance as a defined

operations for the expansion activities of the Company are capitalised.

contribution retirement benefit fund for qualifying employees.

G. Transactions in Foreign Currencies

The Provident Fund Plan is operated by the Regional Provident Fund Commissioner. Under the scheme, the

a. Monetary items relating to foreign currency transactions remaining unsettled at the end of the year are

Company is required to contribute a specified percentage of payroll cost, as per the statute, to the retirement

translated at the exchange rates prevailing at the date of the Balance Sheet. The difference in translation

benefit schemes to fund the benefits. Employees State Insurance dues are remitted to Employees State Insurance

of monetary items and the realised gains and losses on foreign exchange transactions are recognised in

Corporation.

the Statement of Profit and Loss in accordance with ing Standard 11 – ‘The Effects of Changes in

Defined Benefit Plans

Foreign Exchange Rates (Revised 2003)’, as notified under the Companies (ing Standards) Rules,

actuarial valuation being carried out at each Balance Sheet date. Actuarial Gains or Losses are recognised in full in the b. Exchange differences arising on settlement or restatement of foreign currency denominated liabilities

Statement of Profit and Loss for the period in which they occur.

borrowed for the acquisition of Fixed Assets, hither to recognized in the Statement of Profit and Loss are now capitalised based on Para 46A of ing Standard 11 – ‘The Effects of Changes in Foreign Exchange

a.

Rates (Revised 2003)’.

The Company makes annual contributions to the Employees’ Group Gratuity-cum-Life Assurance Scheme of the

Gratuity

Business Review

For Defined Benefit Plan the cost of providing benefits is determined using the Projected Unit Credit Method with

2006 (Also refer Note 23 (a) in the Notes forming part of s).

ICICI and Life Insurance Corporation of India, for funding defined benefit plan for qualifying employees which are

c. The use of foreign currency forward/swap contract is governed by the Company’s policies approved by the

recognised as an expense. The Scheme provides for lump sum payment to vested employees at retirement, death

Board of Directors. These hedging contracts are not for speculation.

while in employment, or on termination of employment of an amount equivalent to 15 days salary payable for each service. The Company restricts the payment of gratuity to the employees below the rank of General Managers to the

Investments are classified as current or long term in accordance with ing Standard 13 on ‘ing for

limits specified in the payment of Gratuity Act, 1972. However the Company complies with the norms of ing

Investments’

Standard 15.

a. Long-term investments are stated at cost to the Company in accordance with ing Standard

Standalone Financials

completed year of service, or part thereof in excess of six months. Vesting occurs upon completion of five years of

H. Investments

b. Leave Encashment Benefits

13 on ‘ing for Investments’. The Company provides for diminution in the value of Long-term

The Company pays leave encashment benefits to employees as and when claimed, subject to the policies of the

investments other than those temporary in nature.

Company. The Company provides leave benefits through annual contribution to the fund managed by HDFC Life.

b. Current investments are valued at lower of cost and fair value. Any reduction to carrying amount and any reversals of such reductions are charged or credited to the Statement of Profit and Loss.



J. Borrowing Cost Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalised as part of the

c. On disposal of an investment, the difference between the carrying amount and net disposal proceeds is

cost of such asset. As per ing Standard 16 ‘Borrowing costs’, a qualifying asset is one that takes necessarily

charged or credited to the Statement of Profit and Loss.

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Annual Report 2013–14

Statutory Section

borrowings and the related revenue expenditure incurred for the period prior to the commencement of



Corporate Review

I. Employee Benefits

b. Capital work–in–progress comprises of and amounts expended on development/acquisition of Fixed Assets

a substantial period of time to get ready for its intended use. All other borrowing costs are expensed as and when

ii. Deferred Tax

incurred.

The differences that result between the profit calculated for income tax purposes and the profit as per the

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

financial statements are identified and thereafter deferred tax asset or deferred tax liability is recorded for timing

K. Segment Reporting

differences, namely the differences that originate in one ing period and get reversed in another, based on

Identification of Segments

the tax effect of the aggregate amount being considered. Deferred tax assets are not recognized unless there is virtual certainty that sufficient future taxable income will be available against which such deferred tax asset can be realized. The tax effect is calculated on the accumulated timing differences at the beginning of this ing year based on the prevailing enacted or substantively enacted regulations.

The Company operates in a single geographical segment, which is India, and the products sold in the pharmacies, are regulated under the Drug Control Act, which applies uniformly all over the Country. The risk and returns of the enterprise are very similar in different geographical areas within the Country and hence there is no reportable secondary segment

O. Impairment

as defined in ing Standard 17.

The carrying amounts of assets are reviewed at each Balance Sheet date to ascertain if there is any indication of impairment based on internal/external factors. An asset is treated as impaired based on the cash generating

Segment Policies

concept at the year end, when the carrying cost of assets exceed their recoverable value, in of Para 5 to

The ing policies adopted for segment reporting are in line with the ing policies adopted in the consolidated

Para 13 of AS-28 ‘Impairment of Assets’ as notified under the Companies (ing Standards) Rules, 2006

financial statements with the following additional policies for Segment Reporting:

for the purpose of arriving at impairment loss thereon, if any. An impairment loss is charged to the Statement of

i.

Profit and Loss in the year in which an asset is identified as impaired. The impairment loss recognized in prior

Revenue and expenses have been identified to segments on the basis of their relationship to the

ing periods is reversed if there has been a change in the estimate of the recoverable amount.

operating activities of the segment. Revenue and expenses, which relate to the enterprise as a whole and are not allocable to segments on a reasonable basis, have been included under “unallocable

P. Bad Debts Policy

expenses”.

Statutory Section



Corporate Review

The Company has complied with ing Standard 17- ‘Segment Reporting’ with Business as the primary segment.

The Board of Directors approves the Bad Debt Policy, on the recommendation of the Audit Committee, after

ii. Inter segment revenue and expenses are eliminated.

the review of debtors every year. The standard policy for write off of bad debts is as given below subject to management inputs on the collectability of the same,

The Company has disclosed this Segment Reporting in the Consolidated Financial Statements as per para (4) of ing Standard – 17- ‘Segment Reporting’.

Period 0-1 years

0%

1-2 years

25%

In determining the earnings per share, the Company considers the net profit after tax before extraordinary item and after

2-3 years

50%

extraordinary items and includes post - tax effect of any extraordinary items. The number of shares used in computing

Over 3 years

Business Review

L. Earnings per Share

% of write off

100%

the basic earnings per share is the weighted average number of shares outstanding during the period. For computing diluted earnings per share, potential equity shares are added to the above weighted average number of shares.

Q. Intangible Assets Intangible assets are initially recognised at cost and amortised over the best estimates of their useful life. Cost of

M. Lease

software including directly attributable cost, if any, acquired for internal use, is allocated / amortised over a period of 36 months to 120 months.

Leases where the lessor effectively retains substantially all the risks and the benefits of ownership of the leased assets

R. Provisions, Contingent Liabilities and Contingent Assets

are classified as operating leases. Operating lease payments are recognised as an expense in the Statement of Profit

A provision is recognised when the Company has a present obligation as a result of a past event and it is probable

and Loss on a straight – line basis over the lease term.

that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Contingent liabilities are not provided for unless a reliable

N. Taxation

estimate of probable outflow to the Company exists as at the Balance Sheet date. Contingent assets are neither

Income Tax

recognised nor disclosed in the financial statements.

Income tax is computed using the tax effect ing method, where taxes are accrued in the same period as and when the related revenue and expense arise. A provision is made for Income Tax annually based on the tax

S. Derivative Financial Instruments

liability computed after considering tax allowances and exemptions.

The Company is exposed to foreign currency fluctuations on foreign currency loans and payables. The company limits the effect of foreign exchange rate fluctuations by following established risk management policies including

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Consolidated Financials

Annual Report 2013–14

i.

Standalone Financials

Operating Lease

the use of derivatives. The company enters into derivative financial instruments where the counterparty is a bank.

a. The Company had issued 9,000,000 Global Depository Receipts of ` 10 (now 18,000,000 Global Depository Receipts of ` 5) each with two way fungibility during the year 2005-06. Total GDR’s converted into underlying

All derivatives are effective hedges against an underlying liability and any cash flows are recognised as and when

Equity Shares for the year ended on 31st March 2014 is 147,449 (2012-13 : 4,597,869) of ` 5 each and total

they occur. Attributable transaction costs are recognised in statement of income as cost.

equity shares converted back to GDR for the year ended 31st March 2014 is 439,944 (2012-13 : 10,949) of ` 5

Gain/(losses) on settlement of foreign currency derivative instruments relating to borrowings which have not been

each. Total GDR’s converted into equity shares upto 31st March 2014 is 25,079,178 (2012-13 : 24,931,729) of

designated as hedges are recorded in finance expense.

` 5 each.

(` in million) 31.03.2013

1,000.00 100.00 1,100.00

1,000.00 100.00 1,100.00

698.29

698.29

695.63

695.63

Authorised 200,000,000(2012-13 : 200,000,000) Equity Shares of ` 5/- each 1,000,000(2012-13 : 1,000,000) Preference Shares of ` 100/- each Issued 139,658,177 ( 2012-13 : 139,658,177) Equity Shares of ` 5/- each Subscribed and Paid up 139,125,159 (2012-13 :139,125,159 )Equity Shares of ` 5/- each fully

Particulars

a.

Opening Balance Closing Balance

Amount

Opening Balance Closing Balance

c.

Bonds Shares Issued on Conversion of Share warrants Shares outstanding at the end of the year

‐ 139,125,159

32,76,922 139,125,159

. 695.63

e.

f.

Equity shares: The Company has one class of equity shares having a par value of ` 5 per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

% of Holding

No. of Shares held

Opening Balance (-) Transfer to General Reserve Closing Balance

27,223,124

19.57

21,313,124

15.32

Integrated (Mauritius) Healthcare Holdings Ltd

15,093,860

10.85

15,093,860

10.85

Oppenheimer Developing Markets Fund

11,678,894

8.39

10,507,859

7.55

4,417,069

3.17

HSTN Acquisition (FII) Limited

‐

‐

6,249.03 1,500.00 7.63 0.19 7,756.85

5,249.03 1,000.00 7.63 0.19 6,256.85

7.63 7.63 -

7.63 7.63

0.19 0.19 -

0.19 0.19

2,306.69 ‐ 3,307.20 799.97 135.95

1,762.50 21.66 3,091.08 765.19 130.04

1,500.00 12.50 3,165.47 28,951.62

1000.00 630.00 2,306.69 26,580.34

h. Surplus Opening balance (-) Dividend paid on FCCB loan and Share Warrants* (+) Net Profit/(Net Loss) for the current year (-) Proposed Dividend on Equity Shares for the year (-) Dividend Distribution Tax on proposed dividend on

% of Holding

PCR Investments Ltd 

170.00 630.00 800.00

Equity Shares (-) Transfer to Reserves (-) Transfer to Debenture Redemption Reserve Closing Balance Total

122

123

3

Contents

4

Consolidated Financials

Annual Report 2013–14

No. of Shares held

800.00 12.50 812.50

Standalone Financials

Name of the Shareholder

31.03.2013

15,195.66 1,942.86 17,138.52

g. Foreign Exchange Fluctuation Reserve

Shareholders holding more than 5% of total paid up capital Equity Shares

17,138.52 ‐ 17,138.52

Investment Allowance Reserve Opening Balance (-) Transfer to General Reserve Closing Balance

Rights, Preferences and Restrictions attached to shares

31.03.2014

60.02 60.02

General Reserve Opening Balance (+) Current Year Transfer (+) Transfer from Investment allowance (+) Transfer from Foriegn exchange Fluctuation Reserve Closing Balance

16.38 695.63

Equity Shares

60.02 60.02

Business Review

Shares outstanding at the beginning of the year Shares Issued to IFC on conversion of FCCB

18.26 18.26

Debenture Redemption Reserve Opening Balance (+) Current Year Transfer Closing Balance

Reconciliation of the number of shares Particulars

18.26 18.26

Securities Opening Balance Add : Securities credited on Share issue Closing Balance

d. 31.03.2013 Equity Shares Number Amount ` in million 134,466,618 672.33 13,81,619 6.91

31.03.2013

b. Capital Redemption Reserve

paid up

31.03.2014 Equity Shares Number Amount ` in million 139,125,159 695.63 ‐ .

31.03.2014

Capital Reserves

Statutory Section

31.03.2014 Amount

(` in million)

Corporate Review

3. Reserves and surplus

2. Share Capital Particulars

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

The Debentures stated above in point (a),(b) &(c) are secured by way of pari u first charge on the fixed assets

4. Long Term Borrowings

of the Company, existing and future along with Bank and Institutions; such pari u first charge ensuring at

(` in million) Particulars

31.03.2014

least a cover of 1.25 times the value of the outstanding principal amount of the loan.

31.03.2013

Secured (a) Non-convertible Debentures 940 (2012‐13: 940) 10.15% Debentures of ` 1,000,000/‐ each 1,250 (2012‐13: 1,250) 9.80% Debentures of ` 1,000,000/‐ each

d. HDFC Bank Limited 1,000.00

1,000.00

The Company has availed Rupee Term Loan of ` 1,300 million from HDFC Bank Limited, which is repayable in

940.00

940.00

twenty quarterly instalments commencing from September 2013 and interest payable @ 11% pa. The loan is

1,250.00

1,250.00

secured by first pari u charge on all present and future movable and immovable fixed assets of the company along with minimum cover of 1.25 times the value of the outstanding principal amount of the loan.

(b) Term loans From Banks HDFC Bank Limited

1,105.00

IFC Loan (External Commercial Borrowings)

965.27

1,179.77

IFC Loan (External Commercial Borrowings)

1,636.80

1,636.80

HSBC ( External Commercial Borrowings)

1,246.60

1,355.00

504.58

141.87

8,388.25

8,608.44

e. International Finance Corporation (External Commercial Borrowings)

From Other parties

HSBC ( Bills Payable ) Total

The Company was sanctioned a sum of US$ 35 million from International Finance Corporation, Washington by way of External Commercial Borrowings (ECB). The Company has withdrawn the full amount of US$ 35 million as of 31st March 2012 on the above loan. The ECB loan is secured by way of pari u first ranking charge on the fixed assets owned by the Company such pari u charge ensuring atleast a cover of 1.25 times the value of the outstanding principal amount of the loan. The Loan is repayable in 15 equal semi-annual Instalments starting from 15th September, 2012. During the year two instalments of US$ 2,333,333 each were repaid on 15th

Unsecured (i) Deposits Fixed Deposits

September 2013 and 15th March 2014. 335.95

The company was granted a further loan of US$ 30 million in the year 2012-13.The ECB loan is secured by way

179.33

(ii) Other loans and advances

of pari u first ranking charge on the fixed assets of the company ensuring atleast a cover of 1.25 times the

Bank of Tokyo Mitsubishi UFJ (External Commercial Borrowings)

1,328.20

-

Total

1,664.15

179.33

Total

10,052.40

8,787.77

value of the outstanding principal amount of the loan. The Company entered into a Currency Cum Interest Rate Swap (CCIRS) with HDFC Bank Limited in Indian Rupee and hedged the loan for interest and foreign currency fluctuation risk. The derivative contract is secured derivative contract matches with the tenure of the loan outstanding as of 31st March 2014.

The Company issued 500 Nos. 10.30% Non Convertible Redeemable Debentures of ` 1 million each on 28th December 2010 with an option to re-purchase/re-issue some or all of its debentures in the secondary market or

f.

otherwise, at any time prior to the specified date of redemption of 28th December 2020 and 500 Nos. 10.30%

Business Review

by a second charge on the immovable assets of the Company to the extent of ` 1,100 million. The tenure of this

a. 10.30% Non Convertible Debentures

HSBC (External Commercial Borrowings)

The company has drawn a loan of US$ 25 million from HSBC in the year 2012-13. The Company entered into

Non-Convertible Redeemable Debentures of ` 1 million each on 22nd March 2011 which will be redeemed on

a Currency Cum Interest Rate Swap (CCIRS) with HSBC Bank in Indian Rupee and hedged the loan for interest

22nd March 2021 to the Life Insurance Corporation of India.

and foreign currency fluctuation risk. The ECB loan is secured by way of pari u first ranking charge on the fixed assets of the Company.

The Company issued 1000 Nos. 10.15% Non Convertible Redeemable Debentures of ` 1 million each on 22nd

g. HSBC (Buyer’s Line of Credit)

March 2012 with an option to re-purchase/re-issue some or all of its debentures in the secondary market or

The Company has availed a buyer’s line of credit of USD 8.40 million(PY: USD 2.61 million), for the equipment

otherwise, at any time prior to the specified date of redemption of 22nd March 2017. The Company had

imported. The loan is secured by first pari u ranking charge on the entire existing and future movable fixed

redeemed debentures amounting to ` 60 million last year as per the and conditions of the issue and the

asset of the company with minimum cover of 1.25 times the value of the outstanding principal amount of the loan.

residual debenture of ` 940 million is outstanding as of 31st March 2014.

Standalone Financials

b. 10.15% Non Convertible Debentures

(previous year it was given in INR)

c. 9.80% Non Convertible Debentures

h. Bank of Tokyo – Mitsubishi UFJ (External Commercial Borrowings)

The Company issued 1,250 Nos. 9.80% Non Convertible Redeemable Debentures of ` 1 million each on 11th

Bank of Tokyo has granted an unsecured loan of US$ 20 million during the year 2013-14 and the same loan has

July 2012 with an option to re-purchase/re-issue some or all of the debentures in the secondary market or

been hedged at ` 66.41 per US$ with HSBC. The Company has entered into a Currency Cum Interest Rate Swap

otherwise at any time prior to the specified date of redemption of 11th July 2017 to First Rand Bank Limited.

(CCIRS) with HSBC Bank Ltd in Indian Rupee for Interest rate and foreign currency fluctuation risk.

124

125

3

Contents

4

Consolidated Financials

Annual Report 2013–14

Statutory Section

845.00

Corporate Review

1,000 (2012‐13: 1,000) 10.30% Debentures of ` 1,000,000/‐ each

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

9. Other Current Liabilities

5. Deferred Tax Liabilties

(` in million)

Additional net deferred tax liability of ` 894.48 million (` 693.26 million) for the period has been recognized in the Statement of Profit and Loss. Particulars

Deferred Tax

Current year

Deferred Tax

Liability as at

charge /(credit)

Liability as at

31.03.2013

31.03.2014

Deferred Tax Liability on of Depreciation* Deferred Tax Liability on of Deferred

987.73

6.03

993.76

Revenue Expenditure (Also Refer note 40 of notes

51.25

(1.02)

50.23

forming part of s) Deferred Tax Liability on of 35 AD 1,355.13 889.46 Total 2,394.11 894.48 *Net of depreciation for the assets claimed as deduction u/s 35AD of The Income Tax Act 1961.

2,244.59 3,288.58

The effects on such Deferred Tax Liability, if any, arising out of assessments completed but under contest under

31.03.2014 582.91 94.79 25.12 4.40

31.03.2013 700.31 181.00 22.27 25.31

125.31 0.46 181.04 5.76 5.16 116.01 446.25 1,587.21

256.86 1.44 185.26 13.18 2.32 106.01 447.38 1,941.34

as per the provisions of Section 205A and 205C of the Companies Act, 1956 is ` 1.97 million (` 1.60 million) in aggregate which comprises of ` 1.97 million (` 1.59 million) as unpaid dividend and ‘Nil’ (` 0.01 million) as unpaid

6. Other Long Term Liabilities

deposit.

Statutory Section

During the year, the amount transferred to The Investors Education and Protection Fund of the Central Government

various stages will be made on the appeals being decided.

Corporate Review

(a) (b) (c) (d) (e)

(` in million)

Particulars Current maturities of long‐term debt Interest accrued but not due on borrowings Unpaid dividends Unpaid matured deposits and interest accrued thereon Other payables Sundry Creditors Others Retention Money on Capital Contracts Inpatient Deposits Rent Deposits Other Deposits Rent Deposits Other Deposits Tax Deducted at Source Outstanding Expenses Total

(` in million) Particulars Rent Deposits Other Deposits Total

31.03.2014 26.70 0.88 27.58

31.03.2013 36.72 0.93 37.65

10. Short Term Provisions (` in million) Particulars

31.03.2014

31.03.2013

(a) Provision for employee benefits

(` in million) Particulars

31.03.2014

31.03.2013

Loans repayable on demand from banks Canara Bank State Bank of Travancore

144.27 -

26.31

Unsecured (i)

15.03 159.30

164.80

Gratuity & EL

184.48

94.32

Total

380.43

259.12

For Dividend - Equity Shares

799.97

765.19

For Dividend Distribution Tax - Equity Shares

135.95

130.04

Total

935.92

895.23

Total

1,316.35

1,154.35

Standalone Financials

Unsecured Deposits Fixed Deposits Total

195.95

(b) Others

Secured (i)

Bonus

Business Review

7. Short Term Borrowings

162.97 189.28

8. Details of Trade payables are based on the information available with the Company regarding the status of Suppliers as defined under the ‘Micro, Small and Medium Enterprises Development Act, 2006. The amount due to Micro, Small and Medium Enterprises for the financial year ended 31st March 2014 is ` 184.79 million 2006 or otherwise has either been paid or payable or accrued and remaining unpaid as at 31st March 2014

126

127

3

Contents

4

Consolidated Financials

Annual Report 2013–14

(` 230.60 million). No interest in of Section 16 of Micro, Small and Medium Enterprises Development Act,

5,068.76 1,799.21

Leasehold Improvements

129

–

336.29

657.15

49.78 174.34

Total Previous Year

70.93

49.78

.

.

245.27

295.05

295.05

2014 245.27

March 31, 2013

Balance April 1, .

Deletions

22,455.17

26,334.07

26.85

41.76

45.23

3.50

77.76

1,448.25

1,087.78

437.44

2,410.70

1,301.22

9,092.90

as at

Additions

–

0.65

–

–

–

0.34

4.29

14.65

37.09

5.49

426.24

2,370.62

6,205.90

1,784.16

as at

Balance

– 168.40

Gross Block

3,778.23

4,536.05

–

3.26

4.26

0.60

1.18

256.00

161.75

88.33

378.42

288.46

1,285.89

739.81

1,137.14

245.27

Consolidated Financials

Computer Software

Fixed Assets

12. Intangible Assets

19,013.23

Previous Year

26.85

Wind Electric Generator 22,455.17

39.15

Refrigerators Total

40.97

2.90

76.58

Kitchen Equipment

Boilers

Fire fighting Equipment

Generators

Electrical Installations &

1,192.59

930.32

Office equipment Others

363.76

Vehicles

Furniture and Fixtures 2,069.37

1,018.25

Air Conditioning Plant & Air Conditioners

8,233.25

Medical Equipment

Plant and Equipment

1,593.21

53.13

104.86

104.86

2013

April 1,

as at

Balance

4,774.39

5,680.45

26.85

9.28

10.51

1.05

8.29

365.37

524.14

140.47

651.59

344.78

2,915.83

200.61

481.68

–

2013

2014

2013

Buildings

April 1,

as at

as at

Balance

March 31,

Balance

as at

190.95

Deletions

Gross Block Additions

April 1,

Land

Fixed Assets

Balance

11. Tangible Assets

Annual Report 2013–14

Standalone Financials

4 Business Review

Contents

124.26

330.83

–

0.21

–

–

–

0.02

4.01

6.10

12.00

1.17

307.32

-

-

-

Deletions

51.73

62.31

62.31

for the year

Amortization

.

.

.

Deletions

Accumulated Depreciation

1,030.32

1,225.33

–

1.37

0.50

0.14

1.21

46.95

95.85

35.51

140.76

209.65

472.49

51.46

169.44

-

for the year

charge

Depreciation

Accumulated Depreciation

Statutory Section

3

-

104.86

167.17

167.17

2014

March 31,

as at

Balance

5,680.45

6,574.95

26.85

10.44

11.01

1.19

9.50

412.30

615.98

169.88

780.35

553.26

3,081.00

252.07

651.12

2014

March 31,

as at

Balance

(` in million)

as at

as at

(` in million)

14,238.84

16,774.72

140.41

127.88

127.88

2014

March 31,

as at

Balance

-

29.87

30.46

1.85

68.29

827.22

406.18

223.29

1,417.78

673.47

5,317.42

1,598.60

4,587.08

1,593.21

2013

March 31,

121.21

140.41

140.41

2013

March 31,

as at

Balance

Net Block

16,774.72

19,759.12

31.32

34.22

2.31

68.26

1,035.95

471.80

267.56

1630.35

747.96

6,011.90

2,118.55

5,554.78

1,784.16

2014

March 31,

Balance

Net Block Balance

Corporate Review

128

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

(Market Value ` 794.41 (2012‐13: ` 660.24 million) 403.72 393.72

Aggregate amount of unquoted investments 5,013.89 4,860.78

Total 5,417.61 5,254.50

131

4

t Venture t Venture Subsidiary t Venture t Venture

Apollo Gleneagles Hospitals Limited Apollo Gleneagles Hospitals PET CT Private Limited Western Hospitals Corporation Private Limited Quintiles Phase One Clinical Trials India Private Limited Apollo Lavasa Health Corporation Limited

Subsidiary Ohters

Sapien Biosciences Pvt Ltd Rajshree Hospital and Research Centre Pvt. Ltd. Total

t Venture

Apollo Hospitals International Limited

Investments in Preference Shares

1

10

100

100

10

10

10

10

10

10

10

10

100

10

10

10

Associate

Others

t Venture

Apollo Hospitals International Limited

Kurnool Hospitals Enterprises Limited

Subsidiary

Sapien Biosciences Pvt Ltd

Associate

Subsidiary

Alliance Dental Care Ltd

Others

Subsidiary

Alliance Medicorp (India) Limited

Rajshree Hospital and Research Centre Pvt. Ltd.

10

Subsidiary

Indraprastha Medical Corporation Limited (Market value as on 31.03.2014 ` 38.85 per share) Stemcyte India Therapautics Private Limited

1,000

Subsidiary

Consolidated Financials

Contents

Standalone Financials

3 5,606,458

1,000,000

1,104,000

157,500

1,175,982

240,196

20,190,740

402,941

146,285

18,000,000

8,500,000

54,675,697

17,590,266

10,000

670,650

6,783,000

-

11,091,842

25,303,060

5,000

25,681,000

12,500,000

16,800

29,823,012

Business Review

130 Apollo Cosmetic Surgical Centre Private Limited

31.03.2013

Apollo Nellore Hospitals Limited

31.03.2014

10

(` in million)

Subsidiary

392.37

5,254.50

Apollo Health & Lifestyle Limited

171.20

5,417.61

1£

4,862.13

-

500,000

1,104,000

157,500

-

240,196

20,190,740

402,941

146,285

18,000,000

8,500,000

54,675,697

17,590,266

10,000

540,600

6,252,600

2,844,262

855,228

25,303,060

5,000

25,681,000

12,500,000

16,800

29,823,012

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Quoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Statutory Section

Aggregate amount of quoted investments 5,246.41

10

Particulars 0.20

367.11

Subsidiary

Total 0.17

469.51

Subsidiary

-

Apollo Hospitals (UK) Limited

22.00

10.00

Imperial Hospitals & Research Centre Limited

22.00

Investments in Debentures or Bonds

10

Investment in Preference Shares

(c) (5)

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

(6)

Trade Investments (Refer A below)

1,000

(b)

Subsidiary

344.91

Subsidiary

437.34

Samudra Health Care Enterprises Limited

Investment in Equity instruments

AB Medical Centres Limited

(a)

10

Advance for Investments 4,495.02

Subsidiary

Grand Total (A + B) 4,776.90

(4)

Other Investments (Refer Table B below)

Unique Home Health Care Limited

Total (B) 115.40

(3)

Investments in Government or Trust securities 4,379.62

291.51

(2)

Total (A) 4,485.39 Partly Paid / Fully paid

4,776.90

171.11

10.00

110.40

1.73

35.89

80.00

393.72

150.00

152.00

153.66

85.00

393.12

352.92

0.40

67.07

67.83

-

53.96

772.52

0.39

1,155.38

250.60

21.80

297.40

(8)

As at 31st March 2014

Amount ` in million

(` in million)

As at 31 March 2013

Investments in Preference Shares 31.03.2013

As at 31st March 2014

Investment in Equity instruments

(b)

Quoted / Unquoted

(a) 31.03.2014

(1) Investement in Equity Instruments

(d)

Non Current Investments

No. of Shares / Units

4,495.02

-

5.00

110.40

1.73

-

80.00

393.72

110.00

152.00

153.66

85.00

393.12

352.92

0.40

54.06

62.52

28.44

13.96

772.52

0.39

1,155.38

250.60

21.80

297.40

(9)

As at 31 March 2013

Amount ` in million

million).

No. of Shares / Units

Particulars

Face Value

* Includes Interest on borrowings capitalised for the year ended 31st March 2014 of ` 341.12 million (` 252

Subsidiary / Associate / JV / Controlled Entity / Others

(10)

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Whether stated at Cost Yes/No

progress is ` 529.13 million (` 377.39 million)*.

Name of the Body Corporate

14.

A) Details of Trade Investments

construction and directly related pre‐operative expenses. The amount of interest included in capital work in

Corporate Review

Annual Report 2013–14 13. Capital Work–in‐Progress ` 4,809.58 million (` 3,727.29 million) comprises amounts spent on assets under

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Others

Others

Others

Others

Others

Others

Others

Others

Others

t Venture

Associate

t Venture

(2)

Others

Entity /

JV/ Controlled

Associate /

Subsidiary / Face

1,000

54.10

1,000

10

10

10

10

10

10

10

(3)

Value

No. of No. of

490,000

490,000

10,000

406,514

935,000

36

75,000

1,571,250

1,232,500

200

2,401,000

-

406,514

-

-

-

-

-

200

2,401,000

31,600,000

33,860,000

(4)

March 2013

As at 31

Units

Shares /

March 2014

As at 31st

Units

Shares /

Quoted /

Unquoted

Quoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

(5)

Unquoted

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

(6)

Fully paid

Partly Paid /

Amount

Amount

4.90

469.51

0.17

10.00

22.00

27.43

13.61

0.75

15.71

12.33

0.002

367.11

0.20

-

22.00

-

-

-

-

-

0.002

24.01

338.60 24.01

316.00 4.90

(9)

2013

As at 31 March

` in million

(8)

March2014

As at 31st

` in million

Yes

-

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

(10)

Yes / No

at Cost

stated

Whether

c.

d.

Particulars

Unsecured, considered good

4 b. Security Deposits

Unsecured, considered good

Loans and advances to related parties

Unsecured, considered good

MAT Credit Entitlement Other Advances 475.75

Advance Income Tax 487.09

Interest Receivable

Total

(a) Investments in Equity Instruments

Particulars

(b) Investments in Debentures

(c)

Aggregate amount of quoted investments

Particulars

Aggregate amount of unquoted investments

Total

597.34 654.47

1,356.15 891.39

351.15 16.15

Other Loans and Advances 1,549.71 2,512.55 392.28

58.89 45.06

4,876.08 3,227.58

16. Current Investments (` in million)

31.03.2014 135.88 135.88

10.00 10.00

Investments in Mutual funds 1,336.79 3,559.97

Total 1,482.67 3,705.85

(` in million)

31.03.2014

(market value ` 1,443.57 million (2012:13 ` 3,657.47 million)

1,346.79

31.03.2013 3,569.97

135.88 135.88

1,482.67 3,705.85

133

Consolidated Financials

Contents Capital Advances

Business Review

3 a. 31.03.2014

Statutory Section

132

Long Term Loans and Advances

Corporate Review

Standalone Financials

b. National Saving Certificates shown under investments are pledged with the Chief Ration Officer, Government of Andhra Pradesh.

Gleneagles Hospitals Limited and the same has been closed on 23rd April 2014.

a. The Company has pledged its 20,775,197 shares in Apollo Gleneagles Hospitals Limited as a security for the loan advanced by IDFC and HDFC to Apollo

Total

National Savings Certificate

Investments in Government or Trust securities

ECL Finance - Non Convertible Debentures

Investments in Debentures or Bonds

Health Super Hiway Private Limited

Investments in Preference Shares

Cureus .Inc ( Stanford - US)

Tirunelveli Vayu Energy Generation Pvt Ltd

Indo Wind Power Pvt Ltd

Clover Energy Pvt Ltd

AMG Health Care Destination Pvt Ltd

Health Super Hiway Private Limited

Furture Parking Private Limited

Family Health Plan Limited

Apollo Munich Health Insurance Company Limited

Investement in Equity Instruments

(1)

Name of the Body Corporate

B) Details of Other Investments

Annual Report 2013–14

15. Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

31.03.2013

(` in million)

716.44

511.79 1,620.51

31.03.2013

10 10

Others Others

Reliance Floating Rate Fund - Short Term Plan Growth Plan Reliance Dynamic Bond Fund Growth Plan

135

Others Others

DWS Short Maturity - Regular Plan - Growth HDFC Debt Fund

Consolidated Financials

Total

Others

Others

L028G SBI Magnum Income Fund-Regular plangrowth

Reliance Short Term Fund-Growth Plan Growh Option

Others

Pine Bridge India Short Term Fund Standard Monthly Dividend

Others

Others

Icici Predential Short Term -Regular Plan - Growth Plan

L148IG SBI Term Debt Fund - Regular Plan - Growth

Others

Idfc Ssif Investment Plan Growth - ( Regular Plan )

Others

Others

Dws Short Maturity Fund - Regular Plan - Growth

Others

Others

Kotak Bond Short Term

Canara Robeco short term Fund - regular Growth

Others

Idfc Ssif Medium Term Plan A Growth

Canara Robeco short term Fund - Regular Growth

Others

Reliance Income Fund - Growth Plan

10

10

10

10

10

10

10

2,000,000

1,784,296

1,292,802

2,095,616

183,284

182,151

1,715,101

-

4,198,646

1,994,716

4,785,788

-

-

-

-

-

-

-

-

-

-

1,00,630

4,198,646

7,068,212

4,785,788

6,820,506

5,006,182

5,171,165

31.03.2013

31.03.2014 (4)

No. of Shares / Units

No. of Shares / Units

14,922,589

6,903,598

7,413,063

10,330,899

5,903,031

188,206

4,681,714

192,148

2,139,907

10,203,665

2,316,123

7,848,123

11,950,115

17,435,790

11,450,688

14,397,190

8.677,204

10

14,922,589

6,903,598

-

10,330,899

9,136,630

188,206

4,681,714

192,148

2,139,907

-

-

-

-

-

-

-

-

10

928,720

1,393,079

31.03.2013

31.03.2014 (4)

No. of Shares / Units

No. of Shares / Units

10

(3)

Others

Sbi Short Term Debt Fund - Regular Plan - Growth

10

10

(2)

Others

Reliance Short Term Fund - Growth Plan

(1)

Others

HDFC Income Fund - Growth

10

Face value

Others

Dws Premier Bond Fund - Regular Plan - Growth

10

“ Subsidiary / Associate / JV/ Controlled Entity / Others “

Others

Kotak Bond Scheme Plan A Growth

10

10

10

10

Name of the Body Corporate

Others

Canara Robeco short term Fund - regular GrowthISIN

10

Others Others

Others

ICICI Prudential short term regular Plan Growth Option Canara Robeco short term Fund-regular Growth

Others

IDFC SSIF Medium term Plan A Growth

Reliance Short Term fund - Growth Plan (ST- GP)

10

Others

Kotak Bond (Short term) Growth

10

Others Others

Kotak bond (Short term) Growth IDFC SSIF Short term Plan C Growth

10

10

Others

Reliance Floating Rate Fund - Short Term Plan Growth Plan

10

10,00,000

Others

Others

100MUR

(3)

(2) Others

Face value

“ Subsidiary / Associate / JV/ Controlled Entity / Others “

ICICI Prudential Liquid Plan Daily Dividend

Investments in Mutual Funds

IFCI Venture Capital Funds Limited

Investments in Debentures

British American Hospitals Enterprises Limited

Investments in Equity Instruments

(1)

Name of the Body Corporate

Details of Current Investment

Annual Report 2013–14

Standalone Financials

4 Business Review

Contents Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

(5)

Quoted / Unquoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Unquoted

(5)

Quoted / Unquoted

Statutory Section

3 Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

(6)

Partly Paid / Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully Paid

(6)

Partly Paid / Fully paid

.

1,482.67

20.00

40.00

30.00

30.00

2.50

2.50

50.00

.

100.00

56.79

100.00

(7)

31.03.2014

Amount (` in million)

200.00

150.00

200.00

200.00

2.50

100.00

2.50

50.00

-

-

-

-

-

-

10.00

135.88

(7)

31.03.2014

Amount (` in million)

3,705.85

.

.

.

101.43

100.00

200.00

100.00

150.00

100.00

200.00

(8)

31.03.2013

Amount (` in million)

200.00

150.00

200.00

200.00

200.00

2.50

100.00

2.50

50.00

200.00

50.00

100.00

250.00

253.54

200.00

250.00

200.00

10.00

135.88

(8)

31.03.2013

Amount (` in million)

Corporate Review

134 Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

(9)

Basis of Valuation

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

(9)

Basis of Valuation

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

17. Inventories

19.

Cash and Cash Equivalents

(` in million)

(` in million) Particulars

31.03.2014

Particulars

31.03.2013 a.

Inventories a. Medicines (Valued at Cost) Stores and spares (Valued at Cost)

c.

Lab Materials (Valued at Cost)

d. e.

1,627.78

149.46

116.58

7.42

13.50

Surgical Instruments (Valued at Cost)

235.55

232.06

Other Consumables (Valued at Cost)

101.13

63.96

2,649.74

2,053.88

Total

Current s

1,617.01

1,680.47

Deposit s

96.77

529.67

Unpaid Dividend s

25.12

22.27

2.75

53.75

Margin money Deposits Guarantees c.

184.75

31.03.2014

3,032.65

3205.05

3,032.65

Particulars a.

31.03.2014

Unsecured, considered good 1,304.35

-

70.91

1,479.46

1,233.44

Other Advances

4,684.51

4,266.09

Loans and advacne to employees

185.62

Advance to Suppliers

147.80

125.52

2,082.15

1,213.31

73.77

2,303.72

68.30

2,489.34

31.03.2013

Directors*

-

-

Other officers of the Company*

-

-

Firm in which director is a partner*

-

-

Private company in which director is a member*

-

3.75

Prepaid Expenses

Total

-

3.75

Rent Receivables

Particulars

1,407.13 1,685.81

21. Other Current Assets

31.03.2014

(` in million) 31.03.2014

31.03.2013

Other Current Assets

Franchise Fees Receivable Total Accrued patient collections constitute ` 313.28 million (` 325.03 million) of Trade receivables.

119.56

98.87

3.95

3.92

47.34

41.71

9.54

8.59

180.39

153.09

22. Revenue from Operations

ii. Confirmations of balances from Debtors, Creditors are yet to be received in a few cases though the group has sent letters of confirmation to them. The balances adopted are as appearing in the books of s of

Particulars

the group.

31.03.2013

a.

Revenue from Healthcare services

24,967.87

22,160.96

b.

Revenue from Pharmacy

13,648.44

11,016.95

38,616.31

33,177.91

Total

project consultancy fees and is considered good. The group holds no other securities other than the personal

(` in million) 31.03.2014

security of the debtors

136

137

3

Contents

4

Consolidated Financials

iii. Sundry Debtors represent the debt outstanding on sale of pharmaceutical products, hospital services and

Standalone Financials

Interest Receivables

* Either severally or tly

Annual Report 2013–14

278.68

Business Review

(` in million)

i.

31.03.2013

Other Loans and Advances

Total



(` in million)

Loans and advances to related parties

1,479.46

Trade receivable stated above include debts due by: Particulars

2,554.66

Short-term loans and advances

from the date they are due for payment

Total

2,088.98

Statutory Section

3205.05

Trade receivables outstanding for a period exceeding six months

Less : Provision for doubtful debts

119.15

20. Short Term Loans and Advances

months from the date they are due for payment

Unsecured, considered good

2,435.51

31.03.2013

Trade receivables outstanding for a period less than six Unsecured, considered good

149.35

162.58

a. The Company’s Fixed Deposit receipts amounting to ` 184.75 million (` 149.35 million) are under lien with the bankers for obtaining Bank Guarantees and Letters of credit

(` in million) Particulars

1,926.40

Cash on hand Total

18. Trade Receivables

31.03.2013

Balances with banks

Corporate Review

b.

2,156.18

31.03.2014

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

(` in million)

23. Other Income

Particulars

(` in million) Particulars (a)

Interest Income

(b)

Dividend Income

31.03.2014

From Long Term Investment (c)

44.02

174.50

2.07

57.00

34.88

32.46

-

1.38

Long term investment

136.72

90.38

(d)

Total

6.88

-

224.57

355.72

Gratuity

Earned

Earned

Leave

Leave

Discount Rate

8.00%

8.00%

8.00%

8.00%

Rate of Increase in Salaries

6.00%

8.00%

6.00%

8.00%

Mortality pre- retirement

LIC 1994-96 Ultimate

Disability Attrition Estimated rate of return on plan assets

Other non-operating income Net gain on foreign currency transactions and translation

Gratuity Assumptions

Net gain/(loss) on sale of investments Current investment

As at 31st March 2013

Investment details on plan assets

Nil

Nil

Nil

Nil

23.00%

23.00%

23.00%

23.00%

8.00%

8.00%

8.00%

8.00%

100% of the plan Assets are invested on debt instruments

a. During the year the Foreign Exchange gain (the difference between the spot rates on the date of the Exchange Loss is ` 1.41 million).

Particulars

24. Cost of Materials Consumed (` in million) Particulars

31.03.2014 Value (`)

%

31.03.2013 Value (`)

%

9,516.01

100.00 8,642.58

100.00

Indigenous Materials

9,453.27

99.34 8,579.38

99.27

Imported Materials

62.74

0.66

63.20

Contribution to provident and other funds

c.

Employee State Insurance

d.

Staff welfare expenses

e.

Staff Education & Training

f.

Bonus

245.90

Leave 112.47

358.37

the beginning of the year Interest Cost Current Service Cost Benefit Paid

21.44 30.87 (27.92)

9.52 15.48 (39.17)

30.96 46.35 (67.09)

19.49 26.24 (4.51)

8.68 11.92 (7.84)

28.18 38.16 (12.35)

Actuarial (gain) / Loss on obligation Present Value of Obligation end of

29.69 336.08

39.19 163.57

68.88 499.65

(5.12) 282.00

13.82 138.55

8.19 420.55

246.56

79.67

326.23

190.01

102.27

292.28

31.03.2014

31.03.2013

5,100.17

4454.78

410.62

291.40

77.11

57.22

312.39

268.05

9.18

7.78

192.76

164.76

6,102.23

5,243.99

of the period Expected return on plan assets

20.13

5.53

25.66

17.46

7.28

24.74

Contributions Benefits paid Actuarial gain / (loss) Fair Value of Plan Assets as on 31st

35.44 (27.92) (17.53) 256.68

58.88 (39.17) (46.42) 58.49

94.32 (67.09) (63.95) 315.17

56.00 (4.51) (12.40) 246.56

10.20 (7.84) (32.24) 79.67

66.20 (12.35) (44.64) 326.23

336.08

163.57

499.65

282.00

138.55

420.55

March, 2014 Reconciliation of present value of the obligation and the fair value of the plan assets Present value of obligation

a. As per the requirements of ing Standard 15 ‘Employee Benefits’ (Revised 2005) as notified under the Companies (ing Standards) Rules, 2006, the contribution to the gratuity is determined using the projected unit credit method with actuarial valuation being carried out at each Balance Sheet date. Only the additional provision as required is charged to the Statement of Profit and Loss for the relevant year– ` 184.48 million (` 94.43 million). (Also refer Note 1(I) of Notes Forming part of s.)

138

139

3

Contents

4

Consolidated Financials

Annual Report 2013–14

Total

420.55

Standalone Financials

b.

Leave 138.55

funded by the company Change in plan assets Fair Value of Plan Assets beginning

(` in million) Salaries and wages

282.00

as at the balance sheet is wholly

25. Employee Benefits Expense a.

Present Value of Obligation as at

the year Defined benefit obligation liability

0.73

(Consumption relates to items used for healthcare services only.)

Particulars

As at 31st March 2013 Gratuity Earned Total

Business Review

Total Consumption of Materials

As at 31st March 2014 Gratuity Earned Total

Statutory Section

(` in million)

transactions, and the actual rates at which the transactions are settled) is ` 6.88 million (2012-13: Foreign

Corporate Review

From Current Investment

31.03.2013

As at 31st March 2014

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | Fair value of plan assets at the end

256.68

-

315.17

(246.56)

(79.67)

(326.23)

of the year Liability / (assets) Unrecognised past service cost Liability / (assets) recognised in the

79.40 79.40

105.08 105.08

184.48 184.48

35.44 35.44

58.88 58.88

94.32 94.32

27. Other Expenses (` in million) Particulars

673.84

556.25

House Keeping Expenses

126.91

125.25

69.10

52.05

15.48 9.52 (5.53) 85.61 105.08

46.35 30.96 (25.66) 132.83 184.48

26.24 19.49 (17.46) 7.28 35.55

11.92 8.68 (7.28) 45.55

Rent

38.16 28.18 (24.74) 52.83 94.43

1,252.87

980.37

Repairs to Buildings

134.73

128.72

Repairs to Machinery

398.97

300.32 43.74

304.22

239.00

Insurance

56.45

40.91

Rates and Taxes, excluding taxes on income

78.32

76.67

100% of the plan assets are

Printing & Stationery

208.37

182.83

invested in debt instruments Actual return on plan assets

Postage & Telegram

16.73

18.54

Director Sitting Fees

1.06

1.42

1,028.75

811.91

378.42

298.96

6.33

6.47

i.

2.60

(40.89)

(38.29)

5.06

(24.96)

Office Maintenance & Others

(19.90)

ment, Publicity & Marketing Travelling & Conveyance

investments of the fund during the estimated term of the obligations. The Gratuity scheme is invested in the

Subscriptions

Gratuity Pay plan offered by ICICI.

Security Charges

101.91

83.12

Legal & Professional Fees

246.44

268.99

Continuing Medical Education & Hospitality Expenses

37.65

29.71

Hiring Charges

61.83

51.17

4.84

8.41

Telephone Expenses

109.08

92.19

Books & Periodicals

10.13

8.84

Donations

16.91

23.32

160.91

106.81

-

28.72

1.35

1.30

ii. The estimate of future salary increase, considered in actuarial valuation, takes of inflation, seniority, promotion and other relevant factors such as demand and supply in the employment market.

Seminar Expenses

26. Finance Costs (` in million) Particulars Interest expense

31.03.2014 766.12

31.03.2013

Bad Debts Written off

638.51

Provision for bad debts

Other borrowing costs Bank Charges Brokerage & Commission Total

103.29

87.37

1.27

0.37

870.68

726.25

Royalty paid Outsourcing Expenses

726.6

541.42

Miscellaneous expenses

71.05

53.27

Loss on Sale of Asset

28.11

38.06 1.41

6,356.58

5,200.16

140

141

3

Contents

4

Consolidated Financials

Annual Report 2013–14

Total

-

Standalone Financials

Net (gain)/loss on foreign currency transactions and translation

Business Review

Expected return on plan assets is based on expectation of the average long term rate of return expected on

Statutory Section

44.70

58.88

Repairs to Vehicles

Corporate Review

Power and fuel Water Charges

30.87 21.44 (20.13) 47.22 79.40

31.03.2013

Other Expenses

balance sheet Gratuity & Leave Encashment cost for the period Service Cost Interest Cost Expected return on plan assets Actuarial (gain) / loss Past Service Cost Net gratuity cost Investment details of plan assets

31.03.2014

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | a. Payment to auditors as statutory auditors

29. Utilisation of Amounts From Securities Issued (` in million)

Particulars

31.03.2014

The company has not raised any sum by way of issue of securities during the year 2013-14. Hence disclosure

31.03.2013

3.71

3.37

Taxation Matters*

0.84

0.56

Company Law Matters*

0.84

0.51

Reimbursement of Expenses

0.33

0.26

Total

5.73

4.70

regarding utilisation of amounts from securities issued is not applicable.

30. Earnings Per Equity Share Particulars Profit before extraordinary items attributable to equity shareholders Weighted Averaged Equity Shares outstanding during the year Basic Earnings Per Share before extra-ordinary item - (A1/B1) Diluted Earningsbefore extraordinary items attributable to equity

28. Contingent Liabilities

3,045.80

139,125,159

137,839,092

23.77

22.10

3,307.20

3,045.80

-

1,381,619

shareholders (Amount ` ) (A2) Foreign Currency Convertible Bond issued (C1)

(` in million)

Promoters Share warrants (D1)

31.03.2013

-

3,276,922

139,125,159

139,125,159

Contingent liabilities and commitments (to the extent not provided for)

Earnings Per Share. (Nos) - (E1)

Contingent Liabilities

Diluted Earnings Per Share before extra-ordinary item - (A2/E1)

23.77

21.89

Profit after extraordinary items attributable to equity shareholders

3,307.20

3,091.25

139,125,159

137,839,092

23.77

22.43

3,307.20

3,091.25

Foreign Currency Convertible Bond issued (C)

-

1,381,619

Promoters Share warrants (D)

-

3,276,922

139,125,159

139,125,159

23.77

22.22

(b) Guarantees Bank Guarantees Corporate Guarantees / Letter of comfort

65.85

77.40

(Amount ` ) (A)

. 262.97 475.00

Weighted Averaged Equity Shares outstanding during the year

268.36

(Nos) - (B)

35.00

Basic Earnings Per Share after extra-ordinary item - (A/B)

(c) Other money for which the company is contingently

Customs Duty

0.52

1.04

99.70

99.70

Income Tax

336.73

Service Tax

27.76

Letter of Credits EPCG Value Addded Tax

shareholders (Amount ` ) (A3)

293.92

Weighted Averaged Equity Shares outstanding for Diluted 36.56

1,524.68

708.00

2.27

2.27

2,795.49

1,522.25

9,871.76

10,644.93

9,871.76

10,644.93

12,667.24

12,167.18

Earnings Per Share. (Nos) - (E) Diluted Earnings Per Share after extra-ordinary item - (A3/E)

Standalone Financials

.

Commitments (a) Estimated amount of contracts remaining to be executed on capital and not provided for

142

143

3

Contents

4

Consolidated Financials

Annual Report 2013–14

Total

Business Review

Diluted Earnings after extraordinary items attributable to equity

liable Sales Tax

Statutory Section

31.03.2014

Weighted Averaged Equity Shares outstanding for Diluted

(a) Claims against the company not acknowledged as debt

(ii)

3,307.20

(Nos) - (B1)

b. Directors travelling included in travelling and conveyance amounts to ` 39.48 million (` 40.54 million).

(i)

31.03.2013

(Amount ` ) (A1)

* Inclusive of Service Tax @12.36%

Particulars

31.03.2014

Corporate Review

Audit Fees*

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

31.

Expenditure in Foreign Currency

SL.No (` in million)

Particulars

a.

For the period ended 31.03.2014

For the period ended 31.03.2013

CIF Value of Imports:

Alliance Medicorp (India) Limited

3

Apollo Health and Life Style Limited

4

Apollo Nellore Hospitals Limited Samudra Health Care Enteprises Limited

Stores and Spares

51.49

49.27

7

Apollo Cosmetics Surgical Centre (P) Limited

Other Consumables

11.26

13.93

8

Western Hospitals Corporation (P) Limited

9

Apollo Hospitals (UK) Limited

Travelling Expenses

25.10

22.25

10

Sapien Bio Sciences Private Limited

Professional Charges

12.27

15.43

11

Alliance Dental care limited

Subscription

-

-

12

Unique Home Health Care Limited

Accreditation

-

-

13

Apollo Koramangala Cradle Limited

ment

-

-

14

Apollo Clinics Gujarat Limited

Business Promotion

-

1.61

15

Apollo Gleneagles Hospital Limited

16

Apollo Hospitals International Limited

Dividends 4.79

3.66

Apollo Lavasa Health Corporation Limited

18

Apollo Munich Health Insurance Company Limited

directly to the share-holder's Non-resident external bank

19

Apollo Gleneagles Pet-CT (P) Limited

20

Future Parking Private Limited

21

Quintiles Phase One Clinical Trials India Private Limited

22

Family Healthplan (TPA) Limited

23

Indraprastha Medical Corporation Limiteid

24

Stemcyte India Therapautics Private Limited

. Non-Residents shareholders to whom remittance was made

200.00

224.00

0.87

0.92

(Nos.) Shares held by non-resident share-holders on which dividend was paid.

32. Earnings In Foreign Currency (` in million) Particulars Hospital Fees

31.03.2014

31.03.2013 293.31

17.12

18.22

Reimbursement Expenses

0.76

0.23

Pharmacy Sales*

9.73

0.29

Project Consultancy Services

* Pharmacy Sales are sales made within India to inpatients that have paid in foreign currency

33. Related Party Disclosures A. List of Related Parties where control exists and other related parties with whom the Company had transactions and their relationships:

Associates

25

Dr.Prathap C Reddy

26

Smt. Preetha Reddy

27

Smt. Suneeta Reddy

28

Smt. Sangita Reddy

29

Smt. Shobana Kamineni

30

Aircel Cellular Limited

31

Aircel Limited

32

Apollo Educational Infrastructure Services Limited

33

Apollo Energy Company Limited

34

Apollo Clinical Excellence Solutions Limited

35

Apollo Medskills Limited

36

Apollo Health Resources Limited

Management Personnel are able

37

Apollo Mumbai Hospital Limited

to exercise significant influence

38

Apollo Reach Hospitals Enterprises Limited

39

Apollo Sindoori Hotels Limited

40

Dishnet Wireless Limited

41

Healthnet Global Limited

42

Indian Hospitals Corporation Limited

Key Management Personnel

Enterprises over which Key

145

3

Contents

4

Consolidated Financials

144

Venture

Standalone Financials

506.66

(control exists)

Business Review

17

of dividends excluding the payment of dividends

Subsidiary Companies

Statutory Section

Imperial Hospitals and Research Centre Limited

6

Nature of relationship

Corporate Review

5

Amount remitted during the year in foreign currency on

Annual Report 2013–14

2

890.33

Expenditure.

c.

AB Medical Centres Limited

1,041.76

Machinery and Equipment

b.

Name of Related Parties

1

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | Name of Related Parties

Nature of relationship

SL.No

Name of Related Parties Apex Builders

45

PCR Investments Limited

88

Apex Construction

46

Vasumati Spinning Mills Limited

89

Indian Hospitex Private Limited

47

Medversity Online Limited

90

Kumaranathu and Company

48

AMG Healthcate Destination Private Limited

91

Vaishnavi Consturctions

49

Apollo Infrastructure Projects Finance Co (P) Limited

92

Indo Wind Power Private Ltd

50

Apollo Tele Health Services Private Limited

93

Nippo Batteries Company Ltd

51

Deccan Digital Networks Private Limited

94

Panasonic Home Appliances India Co Ltd

52

Elixir Communities Private Limited

95

Kamineni Builders Private Limited

53

Faber Sindoori Management Services (P) Ltd

96

Kamineni Builders

54

Garuda Energy Private Limited

97

Avantha Power & Infrastructure Limited

55

Health Superhiway Private Limited

98

Bharti Infratel Limited

56

Kalpatharu Infrastructure Development Co (P) Limited

99

Dalmia Cement (Bharat) Limited

57

Kei Energy Private Limited

100

Magma Fincorp Limited

58

Kei Rajamahendri Resorts Private Limited

101

Mahindra & Mahindra Limited

59

Kei Vita Private Limited

102

Mahindra Worldcity Developers Limited

60

Keimed Private Limited

103

Maschmeijer Aromatics (India) Limited

61

Kei-Rsos Petroleum And Energy Pvt Limited

104

PHL Capital Pvt Ltd

62

Kei-Rsos Shipping Private Limited

105

PHL Finance Pvt Ltd

63

Matrix Agro Private Limited

Enterprises over which Key

106

Piramal Enterprises Limited

64

Peninsular Tankers Private Limited

Management Personnel are able

107

Prime Finvest And Leasing Limited

65

Trac Eco And Safari Park Pvt Limited

to exercise significant influence

108

Precision Containeurs Limited

66

Ppn Holdings (Alfa) Private Limited

109

Sicom Investments & Finance Limited

67

Ppn Holdings Private Limited

110

Tata Motors Limited

68

Ppn Power Generation (Unit-1) (P) Limited

111

Vas Infrastrcuture Limited (CN)

69

PPN Power Generating Company (P) Limited

112

Wipro Limited

70

Preetha Investments Private Limited

113

Yashraj Containeurs Limited

71

Sindya Builders Private Limited

114

Apollo Health Street Limited

72

Sindya Infrastructure Development Co (P) Limited

115

Aircel Smart Money Limited

73

Sirkazhi Port Private Limited

116

Apollo Healthcare Technology Solutions Limited

74

Tharani Energy India Private Limited

117

Apollo Dialysis Private Limited

75

Trac India Private Limited

118

Apollo Home Healthcare Limited

76

British American Hospitals Enterprise Limited

119

Apollo Telemedicine Networking Foundation

77

Universal Quality Services LLC

120

Strides Arcolab Limited

78

Sindya Resources Private Ltd, Singapore

121

Garuda Thermal Power Private Limited

79

APEX Agencies

122

Helios Holdings Private Limited

80

APEX Agencies (HYD)

123

LNG Bharat Private Limited

81

Associated Electricatl Agencies

82

Spectra Clinical Laboratory

83

P. Obul Reddy & Sons

84

Sindya Power Generating Company Private Limited

85

Sindya Holdings Private Limited

146

Enterprises over which Key Management Personnel are able to exercise significant influence

147

3

Contents

4

Consolidated Financials

Kalpathura Enterprises Private Limited

87

Standalone Financials

86

Lifetime Wellness Rx International Limited

Business Review

Kurnool Hospital Enterprises Limited

44

Statutory Section

43

Nature of relationship

Corporate Review

Annual Report 2013–14

SL.No

Sl No 1

Name of Related Parties

Nature of Transaction

297.40

297.40

Transaction during the year

4.37

(1.50)

Payables as at year end

1.46

0.29

10.77

11.67

0.91

0.08

Investment in Equity

21.80

21.80

Payables as at year end

16.55

12.97

7.20

7.20

AB Medical Centers Limited

Samudra Healthcare

Investment in Equity

250.60

250.60

Enterprises Limited

Receivables as at year end

64.27

59.47

Transaction during the year

76.65

66.79

Sl No 11

12

Name of Related Parties

Nature of Transaction

` in million

Investment in Equity

393.12

393.12

Limited

Transactions during the year

908.81

763.20

Fees

101.16

87.83

Receivable as at year end

383.09

325.77

85.00

85.00

Apollo Gleneagles PET-CT

Investment in Equity

Private Limited

Rent received

0.19

1.93

Payables as at year end

1.51

3.76

21.93

23.09

Transactions during the year

14

31.03.2013

` in million Apollo Gleneagles Hospitals

Deposits refundable 13

31.03.2014

Western Hospitals

Investment in Equity

Corporation Private. Limited

Reimbursement of expenses

Apollo Munich Health

Investment in Equity

Insurance Company Limited

Advance for Investment

3.27

3.08

153.66

153.66

-

0.40

338.60

316.00

18.49

-

1.72

1.58

Apollo Hospital (UK) Limited

Investment in Equity

0.39

0.39

2.40

1.86

Transaction during the year

67.61

0.92

5

Apollo Health and Lifestyle

Investment in Equity

772.52

772.52

Receivables as at year end

1.70

0.50

Limited

Advance for Investment

100.00

-

150.00

110.00

Receivables as at year end

Transaction during the year Payables as at year end Receivable as at year end

236.84 -

15.24

-

1,155.38

1,155.38

16.15

16.15

Receivable as at year end

347.08

357.84

Transaction during the year

370.83

327.33

Interest income for the year

1.53

15.37

53.96

13.96

-

57.90

Imperial Hospital and

Investment in Equity

Research Centre Limited

Loan given

Investment in Equity

Limited

Advance for Investment Receivables as at year end

17.90

-

Alliance Medicorp (India)

Investment in Equity

67.83

Limited

Advance for Investment Transaction during the year Payables as at year end

9

Alliance Dental Care Limited

Investment in Equity Receivables as at year end Corporate Guarantees executed Transaction during the year

10

17

18

Investment in Equity

Corporation Limited

Receivables as at year end

Quintiles Phase One Clinical

Investment in Equity

Trials India Private Limited

Receivables as at year end

Family Health Plan Limited

4.51

3.24

152.00

152.00

-

56.07

Rent received

7.80

15.23

Investment in Equity

4.90

4.90

Transaction during the year

7.07

21.42

Receivables as at year end

17.30

17.52

Indraprastha Medical

Investment in Equity

393.72

393.72

Corporation Limited

Receivables as at year end

314.53

392.47

32.31

32.46

1,636.58

1,529.25

80.00

80.00

Dividend Received Transactions during the year 19

Stemcyte India Therapautics Investment in Equity

62.53

20

Dr. Prathap C Reddy

Remuneration Paid

150.50

156.30

-

6.32

21

Smt. Preetha Reddy

Remuneration Paid

51.11

52.50

(0.13)

(0.49)

22

Smt. Suneeta Reddy

Remuneration Paid

51.84

52.50

0.29

0.42

23

Smt. Shobana Kamineni

Remuneration Paid

51.11

52.50

67.07

54.06

24

Smt. Sangita Reddy

Remuneration Paid

2.91

8.75

25

Apollo Sindoori Hotels

Transaction during the year

475.00

35.00

Limited

Payables as at year end

Health Super Hiway Private Limited

Private Limited

26

51.03

52.50

191.14

186.46

2.67

13.92

Investment in Equity

0.002

0.002

Investments in Preference Shares

22.00

22.00

0.69

Investment in Equity

352.92

352.92

International Limited

Investment in Preference Shares

110.40

110.40

Transaction during the year

10.90

12.84

49.42

207.25

Receivables as at year end

-

2.66

0.52

8.34

9.13

-

Receivable as at year end Transactions during the year

Payables as at year end

148

149

3

Contents

4

Consolidated Financials

0.87

Apollo Hospitals

Standalone Financials

Apollo Nellore Hospitals

16

Apollo Lavasa Health

Business Review

8

-

13.22

Interest income for the year

7

6.74

27.96 335.00

Loan given 6

436.01

15

Statutory Section

Commission on turnover 4

Corporate Review

Investment in Equity

Lease Rentals paid

Annual Report 2013–14

` in million

Limited

Interest payable

3

31.03.2013

` in million Unique Home Health Care

Cumulative Deposits Outstanding 2

31.03.2014

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | Sl No 27 28

30

Nature of Transaction

31.03.2014

31.03.2013

` in million

` in million

296.40

244.09

23.15

28.60

3.96

14.96

-

0.87

Receivable as at year end

5.43

-

Receivable as at year end

1.26

0.75

Transactions during the year

37.04

29.89

Receivables at the year end

58.76

-

Faber Sindoori Management

Transaction during the year

Services Private Limited

Payables as at year end

Lifetime Wellness Rx

Transaction during the year

International Limited

Payables as at year end

P Obul Reddy & Sons Keimed Private Limited

Payables at the year end 31

Medvarsity Online Limited

-

16.55

Transactions during the year

3,698.56

3,199.16

Transactions during the year

0.15

0.03

Receivable as at year end

0.24

2.98

Rent received Apollo Health Resources

In respect of Non-cancellable Operating Leases Lease payments recognized in the Statement of Profit and Loss is ` 1,252.87 million ( ` 980.37 million) (` in million) Minimum Lease Payments

9.88

Apollo Mumbai Hospital

Receivables as at year end

7.30

6.87

Limited

Transactions during the year

16.24

18.76

Aircel Cellular Limited

Reimbursement of expenses

0.07

-

Transaction during the year

-

4.12

Transaction during the year

3.72

2.16

-

0.28

1.73

1.73

12.33

-

-

12.33

24.01

24.01

-

0.49

135.88

135.88

Not later than one year

1,035.50

681.84

Later than one year and not later than five years

3,159.56

1,819.05

Later than five years

6,618.72

4,507.58

the lessor and AHEL. Variation/Escalation clauses in lease rentals are made as per mutually agreed and conditions by the lessor and AHEL. 35. (a) The tly Controlled Entities considered in the Consolidated Financial Statements is:

Limited 33 34 35

Dishnet Wireless Limited

Payables as at year end 36

Kurnool Hospitals Enterprise Investment in Equity

Name of the Company Apollo Hospitals International Limited Apollo Gleneagles Hospital Limited Apollo Gleneagles PET CT Private Limited

Limited 37 38 39

AMG Health Care

Investment in Equity

Destination Private Limited

Advance for Investment

Future Parking Private

Investment in Equity

Limited

Advance given

British American Hospitals

Investment in Equity

Apollo Munich Health Insurance Company Limited Future Parking Private Limited Quintiles Phase One Clinical Trials India Private Limited Apollo Lavasa Health Corporation

Enterprise Limited Sapien Bioscience Pvt Ltd

Investment in Equity

41

Aircel Limited

Transaction during the year Payables as at year end

Investments in Preference Shares

Apollo Cosmetics Surgical

Investment in Equity

Centre (P) Limited

Receivables as at year end

0.40

10.00

5.00

4.49

-

0.39

-

-

28.44

0.01

0.36

31.03.2014

31.03.2013

India

50.00*

50.00*

India

50.00

50.00

India

50.00

50.00

India

10.23

10.23

India

49.00

49.00

India

40.00

40.00

India

37.50

34.66

*Inclusive of 27% (27%) shares held by Unique Home Health Care Limited, a 100% Subsidiary of Apollo Hospitals Enterprise Limited. (b) The groups interests in the t venture ed for using proportionate consolidation in the Consolidated Financial Statements are:

150

151

3

Contents

4

Consolidated Financials

Annual Report 2013–14

42

0.40

Proportion of ownership Interest (%)

Standalone Financials

40

Limited

Proportion of ownership Interest (%)

Country of Incorporation

Business Review

-

31.03.2013

Lease agreements are renewable for further period or periods on and conditions mutually agreed between

0.94

Receivables as at year end

31.03.2014

Statutory Section

32

34. Leases

Corporate Review

29

Name of Related Parties

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | (` in million) Particulars I

As at 31st March,2014

(b)

Net Profit

As at 31st March,2013

ASSETS

Non-current assets (a)

Fixed assets Tangible assets

2,244.71

2,143.60

(ii) Intangible assets

18.43

13.02

(iii) Capital work-in-progress

87.55

137.69

-

-

(iv) Intangible assets under development

21.87

V

OTHER MATTERS

(a)

Contingent Liabilities

270.66

200.65

(b)

Capital Commitments

202.39

100.38

36. During the year 2002-03, on a review of fixed assets, certain selected medical equipments were identified and impaired. For the current year, on a review as required by ing Standard 28 ‘ Impairment of Assets’, the management is of the opinion that no impairment loss or reversal of impairment loss is required, as conditions of impairment do not exist.

(b)

Non-current investments

489.31

386.32

37. The Company has been exempted from publishing the financial statements for fifteen of its subsidiaries

(c)

Deferred tax assets (net)

108.73

108.73

including fellow subsidiaries which are required to be attached to the Company’s s, under Sec.212(1)

(d)

Long-term loans and advances

234.75

195.47

of the Companies Act, 1956 for the financial year ended 31st March 2014.

9.04

20.45

Enterprise Limited had initially invested ` 30 million [ ` 5 million towards equity and ` 25 million to discharge

44.18

41.89

other liabilities of AGHL, erstwhile Duncan Gleneagles Hospital Limited (DGHL)] to acquire 50.26% holding

Current assets

38. In the process of acquiring Apollo Gleneagles Hospitals Limited (AGHL) in Kolkata, Apollo Hospitals Current investments

(b)

Inventories

(c)

Trade receivables

288.90

287.96

in DGHL (subsequently reduced to 49%, now increased to 50%). AGHL assigned an unsecured debt of

(d)

Cash and cash equivalents

404.99

362.55

` 163.70 million existing in its books to Apollo Hospitals Enterprise Limited, out of which ` 150 million was

(e)

Short-term loans and advances

42.06

48.42

received till FY 2012-13 and taken to income, leaving a balance unsecured debt of ` 13.70 million. As a

(f)

Other current assets

112.60

84.44

measure of prudence the balance amount was not recognized as an advance or investment in the books

II

LIABILITIES

of Apollo Hospitals Enterprise Limited and will be ed for as and when the amount(s) are received. During the year 2013-14, the balance amount of ` 13.70 million has been received and the same has been

Long-term borrowings

665.39

681.59

(b)

Deferred tax liabilities (Net)

151.06

100.66

(c)

Other Long term liabilities

20.91

18.87

(d)

Long-term provisions

6.98

6.26

duly ed for in the books of s. 39. On review of the operations of setting up the Hospital in Noida, the Company has re-assigned the lease agreement between itself and the lessor to its associate, Indraprastha Medical Corporation Limited by extinguishing its rights and privileges in the original lease deed dated 27th October 2001.

Current liabilities (a)

Short-term borrowings

195.66

277.22

(b)

Trade payables

446.81

469.48

(c)

Other current liabilities

790.50

663.89

(d)

Short-term provisions

1.75

0.08

III

INCOME

(a)

Revenue from operations

(b)

Other income

IV

EXPENSES

(a)

Material consumption, purchase of stock in trade and changes in inventories

on the project will be amortised over the balance lease period of 6 years. The balance yet to be amortised as on 31.03.2014 is ` 18.88 million ( ` 22.03 million).

2,292.77

17.73

16.80

647.24

578.26

476.64

432.55

Finance costs

115.06

126.28

(d)

Depreciation and amortization expense

168.45

154.30

(e)

Other expenses

1,154.73

962.49

118.61

55.72

64.88

33.85

43. Previous year figures have been regrouped and reclassified wherever necessary to confirm with current years classification. As per our Report annexed For M/s. S. Viswanathan Chartered ants Firm Registration No. 004770S V C Krishnan Partner (hip No. 022167) 17, Bishop Wallers Avenue West Mylapore, Chennai - 600 004

Krishnan Akhileswaran Chief Financial Officer

For and on behalf of the Board of Directors Dr. Prathap C Reddy Executive Chairman

S M Krishnan Sr. General Manager - Finance & Company Secretary

Preetha Reddy Managing Director



Suneeta Reddy t Managing Director

Place : Chennai Date : 28th May 2014

152

153

3

Contents

4

Consolidated Financials

Employee benefits expense

42. Figures in brackets relate to the figures for the previous year.

Standalone Financials

2,663.00

(c)

Provision for Taxation(Including Deferred Tax Liability)

amounting to ` 56.62 million are included in advances and deposits . The above expenses incurred

41. Figures of the current year and previous year have been shown in million.

(b)

(a)

40. Unrealised amounts on project development and pre-operative project expenses incurred at Bilaspur Hospital

Business Review

(a)

Profit before tax

Statutory Section

(a)

Non-current liabilities

Annual Report 2013–14

0.38 54.11

Corporate Review

(i)

Add: Deferred tax asset

Cash Flow Statement for the year ended 31st March 2014

operations Amount available in unclaimed dividend and

3,673.71 685.11 1,869.55 2,554.66

162.58

119.15

1,901.28

2,413.24

25.12

22.27

unclaimed deposit payment s. *includes ` 69.78 million (` 35.18 million) towards cost of covering the currency fluctuations and LIBOR risk for ECB availed by the company.

2,128.15 6,329.82

Notes:

1587.17 5,666.97

1. Previous year figures have been regrouped wherever neccessary. 2. Figures in bracket represent outflow.

(579.33) (595.85) 723.81 (1,794.14)

(2,245.51)

(863.90) (226.80) 54.10 (412.62)

(1,449.22)

4084.31 6.88 (1,060.36) 3,030.83 3,030.83

V C Krishnan Partner (hip No. 022167) 17, Bishop Wallers Avenue West Mylapore, Chennai - 600 004

4,217.75 (1.40) (890.70) 3,325.65 3,325.65

(5,373.05) (225.00) (166.59)

(5,396.20) (3,560.00) (380.60)

2,588.40 44.01 36.95

2,713.10 174.50 89.50

Krishnan Akhileswaran Chief Financial Officer

For and on behalf of the Board of Directors Dr. Prathap C Reddy Executive Chairman

S M Krishnan Sr. General Manager - Finance & Company Secretary

Preetha Reddy Managing Director



Suneeta Reddy t Managing Director

Place : Chennai Date : 28th May 2014

AUDITORS' CERTIFICATE We have examined the attached Cash Flow Statement of Apollo Hospitals Enterprise Limited for the year ended 31st March 2014. The statement has been prepared by the Company in accordance with the requirements of Clause 32 of the listing agreement with the Stock Exchanges and is based on and in agreement with the

(3,095.28) (3,095.28) 1,847.52 144.27

As per our Report annexed For M/s. S. Viswanathan Chartered ants Firm Registration No. 004770S

corresponding Statement of Profit and Loss and the Balance Sheet of the Company covered by our report of 28th

(6,359.70) 45.45 (6,314.25)

May 2014 to the of the Company. For M/s. S. Viswanathan Chartered ants Firm Registration No. 004770S

23.30 1,555.81 5,488.70

Place : Chennai V C Krishnan Date : 28th May 2014 Partner hip No. 022167

-

154

155

3

Contents

4

Consolidated Financials

Annual Report 2013–14

1,085.20 (91.80) 38.10 726.30 1.40 (45.45) (174.50) (89.50) 1.92 135.50

(401.23) (465.68) 2,554.66 2,088.98

Standalone Financials

C

Associates Sale of investments Interest received Dividend received Cash flow before extraordinary item Extraordinary Item Net cash used in Investing activities Cash flow from financing activities Proceeds from issue of equity shares Proceeds from issue of share Proceeds from long term borrowings Proceeds from short term borrowings

1,290.78 (136.72) 28.11 870.68 (6.88) (44.01) (36.95) 2.23 160.91

4,079.80

(` in million)

Business Review

B

Cash generated from operations Foreign Exchange gain/(loss) Taxes paid Cash flow before extraordinary items Net cash from operating activities Cash flow from Investing activities Purchase of fixed assets Purchase of investments Investment In Subsidiaries & t Ventures &

4,201.67

(2,111.30) (726.30) (556.50)

Statutory Section

Operating profit before working capital changes Adjustment for: Trade or other receivables Inventories Trade payables Others

2)

31.03.2013

(757.15) (870.68) (765.19)

Corporate Review

Cash Flow from operating activities Net profit before tax and extraordinary items Adjustment for: Depreciation & Amortization Profit on sale of Investment Loss on sale of asset Interest paid Foreign Exchange (gain)/loss Extraordinary Item Interest received Dividend received Provision for Wealth tax Bad debts written off

1)

(` in million)

31.03.2014 A

Repayment of finance/lease liabilities Interest paid* Dividend paid Net cash from financing activities Net increase in cash and cash equivalents (A+B+C) Cash and cash equivalents ( opening balance ) Cash and cash equivalents ( closing balance ) Component of Cash and cash equivalents Cash on Hand Balance with Banks Available with the company for day to day

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

-

617.85 -

602.35 -

586.85

6,742.13 6,900.27 4,876.08

2,088.98 2,669.73

Cash & Bank Balances Loans & Advances

1,838.90

2,554.66

4,266.09

2,053.88

3,227.58

8,960.35

5,665.14

5,550.09 6,542.87

(B) Net Current Assets (A - B)

8.51

157

11.62 15.80

RONW % Employee Cost to Collections

0.35

13.10

ROI (PBIT/AV.CE) %

Consolidated Financials

Debt/Equity Ratio

751.45

626.56

4,494.82

4827.51

3,987.44

3,314.74

3,031.03

5,438.25

773.22

2,955.67

1,709.36

8,469.28

1,234.94

1,869.55

3,537.70

1,827.09

5,103.33

7,641.18

1,738.07

5,071.50

684.04

2,593.45

1,794.01

6,809.57

1,193.53

1,414.40

2,696.43

1,505.21

4,521.44

6,241.12

4,337.02

3,177.52

556.50

839.95

1,781.07

7,514.54

1,260.19

2,855.58

2,055.34

1,343.43

1,859.70

4,897.88

2,111.68

2,027.61

500.60

776.96

750.05

4,139.29

797.36

646.16

1,607.35

1,088.42

1,426.06

6,292.80

8,999.39

2,779.92

1,936.94

1,825.64

422.70

677.20

725.74

3,762.58

664.53

1,045.57

1,261.59

790.89

1,077.59

7,060.10

5,951.78

2,348.32

8,300.10

589.70

3,056.35

17.72

24.60

20.36

8.17

17.41

-

14.66

30.16

26.61

7.72

16.93

-

12.31

29.72

25.56

8.18

16.90

0.12

19.80

20.27

28.72

7.98

16.38

0.45

18.61

14.15

27.85

8.85

17.54

3.07

0.35

15.66

12.17

14.42

196.00

0.29

15.15

11.20

14.63

172.05

0.43

15.18

10.97

13.83

136.61

0.44

15.40

10.43

12.83

249.54

0.33

14.93

9.09

11.33

226.30

0.25

14.65

10.22

13.52

208.48

40,442.90 36,954.47 29,693.24 25,131.74 22,317.52 18,202.93 15,433.65

22.43

23.77

18.42

9.23

17.46

-

18.76

220.00

%

1,154.35

8.85

Book value per Share

Capital Employed

(Basic)

Earnings Per Share ( `)

OP Growth (%)

15.98

16.38

-

NPM% Collection Growth %

1,071.06

6,899.86

1271.75

1,386.80

132.22

696.94

557.64

2,658.55

483.65

644.03

978.92

551.95

591.40

3,229.60

4,452.97

1,982.88

6,435.85

570.64

1,441.80

7,533.28

7,016.90

-

516.38

1,150.67

1,267.79

257.92

401.62

608.25

2,418.46

706.53

364.39

890.36

457.18

511.62

2,729.95

3,530.48

1,682.52

5,213.00

550.19

827.71

6,544.82

6,038.83

-

505.99

863.84

878.18

179.75

314.06

384.37

1,742.02

316.53

219.10

835.14

371.25

337.31

1,062.67

2,917.58

1,427.71

4,345.29

535.65

1,367.55

3,278.20

2,862.21

-

415.99

0.19

14.21

9.84

14.95

144.56

8,967.28

19.63

21.82

25.10

11.12

16.71

7.80

0.13

13.69

12.32

16.72

129.35

7,354.79

12.53

18.17

20.73

8.37

18.83

17.74

0.42

13.23

17.39

20.25

78.81

4,612.40

12.12

17.73

19.18

8.26

20.00

33.35

31st Mar 14 31st Mar 13 31st Mar 12 31st Mar 11 31st Mar 10 31st Mar 09 31st Mar 08 31st Mar 07 31st Mar 06 31st Mar 05

OPM%

Key Indicators

Miscellaneous Expenditure

Financial Highlights year ended

5,048.39

1,316.35

Provisions

2,130.62

1,746.51

Other Liabilities

1,763.42

2,487.23

Creditors

Current Liabilities & Provisions

5,785.31

12,092.96 10,713.53

4,684.51

Debtors

(A)

2,649.74

Inventory

Advances

Current Assets, Loans &

1,700.85

7,689.40

24,696.58 20,642.43 16,369.44 13,981.47 11,974.49

Long Term Loans and Advances

2,394.11

6,921.47

31,438.71 26,427.74 21,196.95 17,968.91 15,289.23 11,779.31

3,288.58

Investments

Net Block

Accumulated Depreciation

Gross Block

Applications

Deferred Tax Liability

8,825.42

10,079.98

685.07

623.55

29,647.24 27,275.97 23,522.66 17,721.64 15,417.78 13,708.55 12,380.36

387.05

672.33

Loans (including long term

-

695.63

Networth

-

695.63

28,951.61 26,580.34 22,463.28 16,413.02 14,799.93 13,106.20 11,793.51

liabilities and provisions)

(` in million)

31st Mar 14 31st Mar 13 31st Mar 12 31st Mar 11 31st Mar 10 31st Mar 09 31st Mar 08 31st Mar 07 31st Mar 06 31st Mar 05

Reserves and Surplus

share warrants

preferential issue of equity

Share Capital

Sources

Balance Sheet

Financial Highlights year ended

TEN years Standalone Financial Performance at a Glance

Annual Report 2013–14

Standalone Financials

4 Business Review

Contents

Statutory Section

3 Corporate Review

156

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Performance Highlights

-

8.26

166.39

491.84

-

8.37

0.10

-

0.02 1.15

-

0.20

3.71 221.19 3.52

1.22

12.00 714.18

72.78 1.28

12.28

0.36

3.80 226.43

21.36 -

3.63

2.62 155.95 1.63

20.00

0.42 28.08 0.26

18.83 1,190.70

12.86

13.23 788.08

762.76 12.90

13.69

53.50 54.32 3,186.49

%) - 5,956.11 (%)

602.16

227.18

11.12

-

13.01 0.15

-

14.54

0.37

0.23

252.92 3.20

92.00

882.93

-

3.61

261.33 3.42

15.08

117.50

19.04 0.15

1.83

927.68 14.43

16.71 1,353.76

984.16 14.21

54.49 3,905.90

- 7,190.54 (%)

LIMITED (‘’the Company’’) and its subsidiaries, and its tly controlled entities and associate companies the Consolidated Statement of Profit and Loss and the Consolidated Cash Flow Statement for the year then

(collectively referred to as ‘’the Group’’) which comprise the Consolidated Balance Sheet as at March 31, 2014,

258.18 352.11

8.85 1,000.70

Management’s Responsibility for the Consolidated Financial Statements 2. Management is responsible for the preparation of these consolidated financial statements that give a true

-

7.97 1,017.45

13.52 0.17 0.17

20.07

20.44 0.17

33.48 0.12

19.06

-

0.25

13.27

288.16 3.31 381.12 3.24

325.07

12.62 1,356.30

0.27

11.63 1,450.98

-

308.01 3.19

-

2.97

367.46

164.24 1.73 198.98 1.51

13.68 0.08

17.54 1,503.48

13.76 1,297.76 13.95 1,582.37

8.72

14.65 1,278.70 14.93 1,684.82

0.04

53.97 4,901.83 54.69 6,207.33

16.38 2,017.41

- 8,995.15 (%)

(%) - 11,500.66

ended and a summary of significant ing policies and other explanatory information.

and fair view of the consolidated financial position, consolidated financial performance and consolidated cash flows of the Group in accordance with ing Standards notified under the Companies Act, 1956 (the Act)

401.60

Circular 15/2013 dated 13th September,2013 of the Ministry of Corporate Affairs). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the

-

8.18 1,180.69

25.04 -

36.86

-

0.67

479.79 3.10

40.19

-

-

439.20 2.92

11.95 1,722.39

223.16 2.03

5.81 0.02

16.92 2,424.94

14.17 2,065.74

15.41 2,210.51

53.50 8,096.51

(%)

- 14,803.50

(which continue to be applicable in respect of section 133 of the Companies Act, 2013 in of General

consolidated financial statements that give a true and fair view and are free from material misstatement, whether 432.49 -

7.73 1,519.63

-

124.89

-

1.36

577.12 2.37

Auditors’ Responsibility

467.67

We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered

-

9.83 1,817.18

-

319.61

-

2.68

1.85

556.45

3. Our responsibility is to express an opinion on these consolidated financial statements based on our audit.

the audit to obtain reasonable assurance about whether the consolidated financial statements are free from

ants of India. Those standards require that we comply with ethical requirements and plan and perform

537.87 -

the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Group’s

765.19

9.23 2,309.90

the consolidated financial statements. The procedures selected depend on the auditor’s judgement, including

preparation and presentation of the consolidated financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an

-

8.51 3,091.09

4. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in

opinion on the effectiveness of the group’s internal control. An audit also includes evaluating the appropriateness of ing policies used and the reasonableness of the ing estimates made by management, as well

799.96

3,307.20

-

-

629.79 2.07

-

693.26 2.30

-

894.48

-

295.45

0.88

435.46

material misstatement.

-

-

11.46 2,221.65

-

14.36 2,693.24

-

12.18 3,375.15

45.45

10.82 4,079.80

-

4,201.68

-

543.06 3.00

-

705.85 3.88

-

911.28 3.24

-

3.32 1,085.20

-

1,290.78

377.47 2.35 551.45 2.71 636.03 2.17 726.25 2.24 870.68

3.43

16.81 3,145.63

-

20.95 3,950.54

-

17.46 4,922.46

-

16.38 5,845.80

-

6,363.14

15.74 2,633.37 19.22 3,697.38

15.20 2,863.80 18.24 3,572.00

15.53 4,516.91 16.37 5,200.16 6,356.58

6,102.23

15.71 5,243.99

15.66 4,285.07

52.25 9,944.64 61.95 12,275.73 51.36 14,554.76 51.54 17,198.23 20,018.93

- 33,488.18

(%)

(%)

- 28,279.20

(%)

- 23,495.65

(%)

- 18,587.45

due to fraud or error.

38,840.00

31st March 2005 31st March 2007 31st March 2008 31st March 2009 31st March 2010 31st March 2011 31st March 2012 31st March 2013

1. We have audited the accompanying Consolidated financial statements of APOLLO HOSPITALS ENTERPRISE

Standalone Financials

31st March 2014

Report on the Consolidated Financial Statements.

Business Review

as evaluating the overall presentation of the consolidated financial statements. We believe that the audit evidence

Dividend

PAT

Fringe Benefit Tax

Deferred

Previous

Tax - Current

PBT

Extraordinary Items

Provision for Investment

Depreciation

Financial Expenses

Operating Profit

Other Expenses

istrative Expenses

Salaries and Wages

Operative Expenses

Income

Profit & Loss

we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

158

159

3

Contents

4

Consolidated Financials

TEN years Standalone Financial Performance at a Glance

To the Board of Directors of Apollo Hospitals Enterprise Limited

Statutory Section

Annual Report 2013–14

Independent Auditor’s Report

Corporate Review

31st March 2006

(` in million)

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Opinion 5. In our opinion and to the best of our information and according to the explanations given to us, and based on consideration of the reports of the other auditors on the financial/consolidated financial statements of the subsidiaries, associates and t ventures as noted below, the consolidated financial statements give a true and fair view in conformity with the ing principles generally accepted in India : (a) in the case of the Consolidated Balance Sheet, of the state of affairs of the Group as at March 31, 2014;



(b) in the case of the Consolidated Statement of Profit and Loss, of the profit of the Group for the year ended

Corporate Review



on that date; and

(c) in the case of the Consolidated Cash Flow Statement, of the cash flows for the year ended on that date.

Other Matters 6.

The financial statements of Subsidiaries (Note 2A), t Ventures (Note 2C),

which in the aggregate

Statutory Section

represents total assets (net) as at March 31, 2014 of ` 5,238.10 million (31.03.2013: ` 6,669.91 million), total revenues (net) for the year ended on that date of ` 7,210.46 million (31.03.2013: ` 10,985.21 million), total net Loss of ` 472.12 million (31.03.2013: ` loss of 78.44 million) and net cash flows of ` 2,848.44 million (31.03.2013: ` 2428.11 million) and of Associates (Note 2B), which reflect the Group’s share of profit of ` 104.34 million (31.03.2013: profit of ` 86.50 million) for the year, have been audited by other auditors (Unique Home Health Care Limited, a subsidiary and Apollo Munich Health Insurance Company Limited, a t Venture, audited by amounts included in respect of these entities are based solely on the report of the other auditors. The consolidated financial statements include the group’s share of loss of ` 18.87 million (31.03.2013 – loss of ` 31.81 million) of Quintiles Phase One Clinical Trials India Private Limited, a t Venture and is based on the

Business Review

Consolidated Financial Statements

us) whose reports have been furnished to us by the management, and our opinion in so far as it relates to the

unaudited management certified s.

17, Bishop Wallers Avenue (West), Mylapore, Chennai – 600 004

Place: Chennai

FRN : 004770S V C Krishnan Partner hip No: 022167

160

161

3

Contents

4

Consolidated Financials

Annual Report 2013–14

Date :28th May 2014

Chartered ants

Standalone Financials



For M/s S Viswanathan

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Consolidated statement of Profit & Loss

Consolidated Balance Sheet As at 31st March 2014 Particulars

I.

EQUITY AND LIABILITIES 1 Shareholders’ funds

(b) Trade payables Add : Share of t Ventures (c) Other current liabilities* (d) Short-term provisions TOTAL

695.63 26,772.10 173.44

6 7 8 9

12,223.80 3,519.10 37.52 22.00

10,789.00 2,545.70 46.55 27.86

10

625.01

578.77

2,803.65 446.81 2,763.04 1,329.23 53,724.79

2,217.63 469.48 2,899.53 1,174.94 48,390.65

1,499.44

1,453.00

11 12

ASSETS 1 Goodwill on Consolidation 2 Non-current assets (a)

Fixed assets (i) Tangible assets

13

25,135.52

21,766.55

(ii) Intangible assets

14

177.95

186.33

(iii) Capital work-in-progress

15

4,739.21

3,885.86

173.85

148.07

(iv) Intangible assets under development Non-current investments

16

1,660.66

1,479.54

(c)

Deferred tax assets (Net)

7

228.17

251.45

(d)

Long-term loans and advances

17

5,101.05

3,685.74

TOTAL (a) Cost of materials consumed during the year (b) Puchase of Stock-in-Trade (c) Changes in inventories of stock-in-trade Add: Share in t Ventures (d) Employee benefits expense (e) Finance costs (f) Depreciation and amortization expense# (g) Other expenses

18

1,555.01

3,787.59

(b)

Inventories

19

2,785.51

2,186.83

(c)

Trade receivables

20

5,197.66

4,733.03

(d)

Cash and cash equivalents

21

2,741.47

3,200.64

2,407.22 322.07 53,724.79

1,389.74

(e)

Short-term loans and advances

22

(f)

Other current assets

23

TOTAL

Annual Report 2013–14

28

IV. V. VI. VII.

PROFIT BEFORE EXTRAORDINARY ITEMS AND TAX EXTRAORDINARY ITEMS * PROFIT BEFORE TAX TAX EXPENSE (a) Current tax ( MAT ) (b) MAT Credit Entitlement (c) Net Current Tax (d) Deferred tax (e) Deferred tax Asset

882.82 (860.51) 22.31 995.74 0.43 3,049.45 (13.65) 3,063.10 104.34 3,167.44

841.49 (534.66) 306.83 743.54 2,940.41 (16.58) 2,956.99 86.51 3,043.50

7

VIII PROFIT / (LOSS) FOR THE PERIOD Less : Minority Interest

IX

PROFIT AFTER MINORITY INTEREST Add: Share in Associates

X IX

EARNINGS PER EQUITY SHARE OF FACE VALUE OF ` 5 EACH

X.

Before Extraordinary Item Basic (in `) Diluted (in `) After Extraordinary Item Basic (in `) Diluted (in `) Consolidated Notes Forming Part of s

236.26 48,390.63

PROFIT AFTER SHARE IN ASSOCIATES

22.77 22.77

21.62 21.42

22.77 22.77

22.08 21.88

# Nil ` 0.50 million being the group share of impairment of fixed assets of Quintiles Phase one clinical Trials India Pvt Ltd. * Represents profit on sale of the company’s equity investment in Apollo Health Street Limited

For and on behalf of the Board of Directors Dr. Prathap C Reddy Executive Chairman

S M Krishnan Sr. General Manager - Finance & Company Secretary

Preetha Reddy Managing Director



Suneeta Reddy t Managing Director

As per our Report annexed For M/s. S. Viswanathan Chartered ants Firm Registration No. 004770S V C Krishnan Partner (hip No. 022167) 17, Bishop Wallers Avenue West Mylapore, Chennai - 600 004 Place : Chennai Date : 28th May 2014

Place : Chennai Date : 28th May 2014

162

Krishnan Akhileswaran Chief Financial Officer

For and on behalf of the Board of Directors Dr. Prathap C Reddy Executive Chairman

S M Krishnan Sr. General Manager - Finance & Company Secretary

Preetha Reddy Managing Director



Suneeta Reddy t Managing Director

163

3

Contents

4

Consolidated Financials

V C Krishnan Partner (hip No. 022167) 17, Bishop Wallers Avenue West Mylapore, Chennai - 600 004

Krishnan Akhileswaran Chief Financial Officer

26 27

TOTAL

* includes a portion of Long term borrowings of ` 594.77 million payable within the next 12 months. As per our Report annexed For M/s. S. Viswanathan Chartered ants Firm Registration No. 004770S

9,430.00 8,639.91 (89.84) 578.26 6,231.31 1,032.50 1,423.42 6,815.41 34,060.97 3,927.83 62.95 3,990.78

Standalone Financials

Current investments

10,353.24 10,962.79 (461.98) 647.24 7,274.49 1,193.77 1,677.91 8,342.32 39,989.78 4,067.08 4,067.08

III. EXPENSES

3 Current assets (a)

25

Business Review

(b)

II. OTHER INCOME

(` in million) 31.03.2013 35,394.29 2,292.77 301.74 37,988.80

Statutory Section

II.

(a) Short-term borrowings

695.63 29,071.17 187.83

31.03.2014 41,171.21 2,663.00 214.65 44,056.86

Corporate Review

(a) (b) (c) (d)

Current liabilities

REVENUE FROM OPERATIONS

Note 24

Add: Share in t Ventures 4 5

Long-term borrowings Deferred tax liabilities (Net) Other Long term liabilities Long-term provisions

Particulars

I.

(a) Share capital (b) Reserves and surplus (c) Money received against share warrants

2 Minority Interest 3 Non-current liabilities

4

31.03.2014

Note

for the year ended 31st March 2014

(` in million) 31.03.2013

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Notes Forming Part of s

A. Investment in Subsidiaries 1. The Subsidiary Companies considered for the purpose of consolidation are:

ing Policies & Notes forming part of the Consolidated s of Apollo Hospitals Enterprise Limited, its Subsidiaries, Associates and t Ventures.

1. Basis of ing The financial statements are prepared under the historical cost convention under the accrual method of ing and as a going concern, in accordance with the Generally Accepted ing Principles (GAAP) prevalent in India and the Mandatory ing Standards as notified under the Companies (ing Standards) Rules, 2006 and according to the provisions of the Companies Act, 1956.

Apollo Hospital (Uk) Limited

applied consistently and judgments and estimates made are reasonable and prudent. The financial statements have been prepared on a going concern basis unless it is inappropriate to presume that the Company will continue in business.

Quintiles Phase One Clinical Trials India Private Limited The Company is a Small and Medium Sized Company (SMC) as defined in the General Instructions in respect of ing Standards notified under Section 211 (3C) [Companies (ing Standards) Rules 2006 as amended] of the Companies Act, 1956. Accordingly, the Company has complied with the ing Standards as applicable to

Apollo Munich Health Insurance Company Limited The financial statements have been prepared in accordance with generally accepted ing principles and practices

as on

31st March 2014

31st March 2013

India

100.00

100.00

AB Medical Centres Limited

India

100.00

100.00

Apollo Health and Lifestyle Limited

India

100.00

100.00

Samudra Healthcare Enterprise Limited

India

100.00

100.00

Imperial Hospital & Research Centre Limited #

India

85.76

85.76

United Kingdom

100.00

100.00

Apollo Nellore Hospitals Limited

India

79.44

74.94

Apollo Cosmetic Surgical Centre Private Limited ###

India

###

69.40

Alliance Medicorp (India) Limited

India

51.00

51.00

Western Hospitals Corporation Private Limited

India

100.00

100.00

ISIS Healthcare India Private Limited

India

-

*

Mera Healthcare Private Limited

India

-

*

Apollo Koramangla Cradle Limited@@

India

@@

@@

Apollo Clinics (Gujarat) Limited*

India

*

*

Alliance Dental Care Limited@

India

@

@

Sapien Bioscience Private Limited

India

70.00

70.00



# Formerly Imperial Cancer Hospital & Research Centre Limited.



* 100% subsidiary of Apollo Health and Lifestyle Limited. During the year 2013-14 ISIS Healthcare India Private Limited and Mera Healthcare Private Limited has been amalgamated with Apollo Health & Lifestyle

followed in India and conform to the statutory requirements of the Insurance Act, 1938, The Insurance Regulatory and

Business Review

a Small and Medium Sized Company.

as on

Statutory Section

Practice (United Kingdom ing Standards and applicable law). Suitable ing policies are selected and

Incorporation

Unique Home Health Care Limited

Apollo Hospital (UK) Limited

The financial statements have been prepared in accordance with United Kingdom Generally Accepted ing

Country of

% of holding

Corporate Review

Name of the Subsidiary

% of holding

Limited

Development Authority (Preparation of Financial Statements and Auditor’s Report of Insurance Companies) Regulations 2002, orders and directions issued by IRDA in this regard, The Companies Act, 1956 to the extent applicable and



@@ 81% subsidiary of Apollo Health and Lifestyle Limited (2012-13 : 100%)

the ing standards issued by the Institute of Chartered ants of India(ICAI) to the extent applicable. The



### Investment in Apollo Cosmetic Surgical Centre Private Limited has been transferred to Apollo Health &

financial statements have been prepared on historical cost convention and on accrual basis as a going concern.

Lifestyle Limited, hence it is now 69% subsidiary of Apollo Health & Lifestyle Limited. @ Subsidiary of Alliance Medicorp (India) Limited in which AHEL holds 23.78% (21.07%)

2. Financial Statements of all the subsidiaries have been drawn upto 31st March 2014.

The Consolidated Financial Statements have been prepared in accordance with ing Standard 21-‘Consolidated

3. Minority Interest consists of the share in the net assets of the subsidiaries, as on the date of the Balance

Financial Statements’, ing Standard 23-‘ing for Investment in Associates in Consolidated Financial

Sheet.

Statements’ and ing Standard 27-‘Financial Reporting of Interests in t Ventures’, as notified under the

Standalone Financials



2. Basis of Consolidation

164

165

3

Contents

4

Consolidated Financials

Annual Report 2013–14

Companies (ing Standards) Rules, 2006.

4. The Group’s interests in the t Ventures ed for using proportionate consolidation in the Consolidated

B. Investment in Associates 1.

Financial Statements are:Financial Statements are:

The Associate Companies considered in the Consolidated Financial Statements are: Name of the Associate Company

Proportion

Proportion

Incorporation

of ownership

of ownership

interest (%) as

interest (%) as

on 31st March

on 31st March

2014

2013

Indraprastha Medical Corporation Limited.

India

22.03

22.03

Family Health Plan Limited.

India

49.00

49.00

Stemcyte India Therapautics Private Limited

India

24.50

24.50

2.

(` in million)

The financial statements of all associates are drawn upto 31st March 2014.

C. Investments in t Ventures 1. The following are tly controlled entities.

Name of the Company

Country of Incorporation

Proportion

of ownership

of ownership

interest (%) as

interest (%) as

on 31st March

on 31st March

2014

2013

Apollo Gleneagles Hospitals Limited

India

50.00

50.00

Apollo Gleneagles PET – CT Private Limited

India

50.00

50.00

Apollo Hospitals International Limited**

India

50.00**

50.00**

Future Parking Private Limited

India

49.00

49.00

Apollo Munich Health Insurance Company Limited

India

10.23

10.23

Apollo Lavasa Health Corporation Limited

India

37.50

34.66

Quintiles Phase One Clinical Trials India Private Limited

India

40.00

40.00

**Apollo Hospitals Enterprise Limited directly holds 23% (23%) in Apollo Hospitals International Limited and a further 27% (27%) through its wholly owned subsidiary Unique Home Health Care Limited. 2. The Financial statements of all the t Ventures are drawn upto 31st March 2014.

3. In the case of Quintiles Phase One Clinical Trials India Private Limited, a t venture, unaudited Management Certified s has been taken for consolidation.

Profit before tax

(b) V (a) (b)

166

9.04 44.18 288.90 404.99 42.06 112.60

20.45 41.89 287.96 362.55 48.42 84.44

665.39 151.06 20.91 6.98

681.59 100.66 18.87 6.26

195.66 446.81 790.50 1.75

277.22 469.48 663.89 0.08

2,663.00 17.73

2,292.77 16.80

647.24

578.26

476.64 115.06 168.45 1,154.73

432.55 126.28 154.30 962.49

118.61

55.72

64.88

33.85

0.38 54.10

21.88

270.66 202.39

200.65 100.38

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Consolidated Financials

Annual Report 2013–14

(a)

Provision for Taxation(Including Deferred Tax Liability) Add: Deferred tax asset Net Profit OTHER MATTERS Contingent Liabilities Capital Commitments

2,143.60 13.02 137.69 386.32 108.73 195.47

Standalone Financials



2,244.71 18.43 87.55 489.31 108.73 234.75

Business Review



Proportion

As at 31st March,2014 As at 31st March,2013

Statutory Section

Particulars I ASSETS Non-current assets (a) Fixed assets (i) Tangible assets (ii) Intangible assets (iii) Capital work-in-progress (iv) Intangible assets under development (b) Non-current investments (c) Deferred tax assets (net) (d) Long-term loans and advances Current assets (a) Current investments (b) Inventories (c) Trade receivables (d) Cash and cash equivalents (e) Short-term loans and advances (f) Other current assets II LIABILITIES Non-current liabilities (a) Long-term borrowings (b) Deferred tax liabilities (Net) (c) Other Long term liabilities (d) Long-term provisions Current liabilities (a) Short-term borrowings (b) Trade payables (c) Other current liabilities (d) Short-term provisions III INCOME (a) Revenue from operations (b) Other income IV EXPENSES Material consumption, purchase of stock (a) in trade and changes in inventories (b) Employee benefits expense (c) Finance costs (d) Depreciation and amortization expense (e) Other expenses

Corporate Review

Country of

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

D. As far as possible the Consolidated Financial Statements are prepared using uniform ing policies for like

Alliance Medicorp (India) Limited

transactions and other events in similar circumstances, and are presented in the same manner as the Company’s

Inventories are stated at lower of Cost or net realizable value. Cost of Inventory comprises cost of purchase of inventories.

separate financial statements.

Net Realizable value represent the estimated selling price less all estimated cost necessary to complete the sale.

E. The effects arising out of variant ing policies among the group Companies have not been calculated and

Apollo Health and Lifestyle Limited

dealt with in the Consolidated Financial Statements since it is impracticable to do so. Accordingly, the variant

Consumables are valued at lower of cost or net realisable value. Cost is determined on First in First out basis. Net

statements.

Realizable value is the estimated selling price in the ordinary course of business, less estimated cost necessary to make sale.

standalone s of all fifteen of its subsidiaries under section 212(1) of the Companies Act, 1956. However,

Apollo Gleneagles Hospitals Limited

necessary disclosure under section 212(1) has been made.

Corporate Review

ing policies adopted by the Subsidiaries, Associates and t Ventures have been disclosed in the financial

F. For the fiscal year ending 31st March 2014, the Company (AHEL) has been exempted from publishing the

Inventories are valued at lower of the Cost or net realizable value. Costs have been calculated on first-in, first-out basis. Items such as surgical instruments/tools etc. are charged out over a period of 36 months from the month of their

G. The foreign operations of the Company are considered as non – integral foreign operations. Hence, the assets

purchase.

and liabilities have been translated at the exchange rate prevailing on the date of the Balance Sheet, Income and Expenditure has been translated at average exchange rates prevailing during the reporting period. Resultant

Future Parking Private Limited

Statutory Section

currency exchange gain or loss is transferred to Foreign Currency Translation Reserve.

Raw Material:

3. Significant ing Policies

Raw Material, Stores and Spares are valued at weighted average cost. Cost comprises all costs of purchase.

A. Use of Estimates

Work-in-progress:

The preparation of financial statements are in conformity with generally accepted ing principles and requires

Work-in-progress is valued at cost or the contract rates whichever is lower.

the management to make estimates and assumptions that affect the reported values of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported revenues and

Completed projects:

expenses during the reporting period. Although these estimates are based upon management’s best knowledge of

Completed Projects are valued at cost or net realizable value, whichever is less.

Business Review

current events and actions, actual results could differ from the estimates.

Indraprastha Medical Corporation Limited

B. Inventories

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

1. The inventories of all medicines, medicare items traded and dealt with by the Company are valued at cost. In the absence of any further estimated costs of completion and estimated costs necessary to make the sale, the

i)

Inventories are valued at lower of cost and net realizable value.

ii)

The cost in respect of the items constituting the inventories has been computed on FIFO basis.

Net Realisable Value is not applicable. Cost of these inventories comprises of all costs of purchase and other costs incurred in bringing the inventories to their present location after adjusting for VAT wherever applicable,

C. Prior Period Items and Extraordinary Items

applying the FIFO method.

Standard 5 on ‘Net Profit or Loss for the Period, Prior Period Items and Changes in ing Policies’ as notified

2. Stock of provisions, stores (including lab materials and other consumables), stationeries and housekeeping

under the Companies (ing Standards) Rules, 2006.

items are stated at cost. The net realisable value is not applicable in the absence of any further modification/ alteration before being consumed in-house only. Cost of these inventories comprises of all costs of purchase



and other costs incurred in bringing the inventories to their present location, after adjusting for VAT wherever

D. Depreciation and Amortisation

applicable applying FIFO method.



i.



3. Surgical instruments, linen, crockery and cutlery are valued at cost and are subject to 1/3 write off wherever modification/alteration before being consumed in-house. Cost of these inventories comprises of all costs of



purchase and other costs incurred in bringing the inventories to their present location.

b. On assets installed prior to 2nd April 1987 on straight-line method at the rates equivalent to the Income Tax rates.

4. Imported inventories are ed for at the applicable exchange rates prevailing on the date of transaction.

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Annual Report 2013–14

a. On assets installed after 1st April, 1987 on straight line method at rates specified in Schedule XIV of the Companies Act, 1956 on single shift basis.

applicable applying FIFO method. The net realisable value is not applicable in the absence of any further



Depreciation has been provided

Standalone Financials



Prior period items and extraordinary items are separately classified, identified and dealt with as required under ing

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

ii. Depreciation on new assets acquired during the year is provided at the rates applicable from the date of

Electrical Fittings

acquisition to the end of the financial year.

iii. In respect of the assets sold during the year, depreciation is provided from the beginning of the year till the date of its disposal.



iv. Individual assets acquired for ` 5,000/- and below are fully depreciated in the year of acquisition.

16.21

Broadband Connections

16.21

Vehicles

9.50

Medical Equipments

7.07

Vehicles -Motor vehicle

20.00

Software & Packages

16.21

v. Amortization

Sapien Biosciences Private Limited



Depreciation on additions / deletions from fixed Assets during the year is charged on pro-rata basis from/up to the date

a. The cost/ of land and building taken on lease by the Company from Orient Hospital, Madurai will be amortised over a period of 30 years though the lease is for a period of 60 years.

on which the asset becomes available/now available for use. Lease hold land is amortised over the lease life of the land.

The cost/ of land and building taken additionally on lease by the Company at Madurai is for a period

Apollo Gleneagles Hospitals Limited

of 9 years with an option to extend the lease by another 16 years. The depreciation on the leasehold building

Depreciation on fixed assets is provided for on straight line basis as follows:

is charged on a straight line basis with the lease period being considered as 25 years.

Statutory Section

(a) Hospital Buildings - at 3.33 %.

The Company has taken land in Karaikudi from Apollo Hospitals Educational Trust on lease for a period of 30 years. The building constructed on the lease land will be amortised over a period of 30 years. This is

(b) Other Assets – As per Schedule XIV of the Companies Act, 1956.

in conformity with the definition of the lease term as per Clause 3 of AS 19 ‘Leases’ as notified under the Companies (ing Standards) Rules, 2006.

Apollo Lavasa Health Corporation Limited

b. Lease rental on operating leases is recognised as an expense in the Statement of Profit and Loss on straight-

Depreciation on Fixed Assets other than Intangible Assets has been provided on written down value method at the

line basis as per the of the agreement in accordance with ing Standard 19 ‘Leases’ as notified

rates specified in Schedule XIV of the Companies Act, 1956 on pro-rata basis. Cost of lease hold land is amortized on

under the Companies (ing Standards) Rules, 2006.

a straight line basis over the period of lease. In respect of intangible assets being computer software relating to Hospital Management System is amortized over the estimated useful life of ten years under straight line method on pro-rata basis.

Depreciation on Fixed Assets purchased before December 1993 are provided on a Straight Line Method (on pro-rata basis) at the old rates prescribed in Schedule XIV of the Companies Act, 1956 and assets purchased after January 1994

Apollo Munich Health Insurance Company Limited

are provided on Straight Line Method (on pro-rata basis) at the new rates prescribed in Schedule XIV of the Companies

Depreciation on fixed assets is provided on straight line method (SLM) with reference to the management’s assessment

Act, 1956.

Business Review

A.B. Medical Centres Limited

of the estimated useful life of the asset or rates mentioned in Schedule XIV to Companies Act, 1956, whichever is higher. The depreciation rates used are given below:

Apollo Cosmetic Surgical Center Private Limited

Asset Class

Act, 1956.

Information Technology Equipment

25%

Computer Software

20%

Apollo Health and Lifestyle Limited

Office equipments

25%

Depreciation is provided using the straight-line method, pro rata for the period of use of the assets, at annual depreciation

Furniture & Fixtures

25% or on the basis of lease term of premises, whichever is higher

rates stipulated in Schedule XIV to the Indian Companies Act, 1956, or based on the estimated useful lives of the assets, whichever is higher, as follows:Asset

Rate of Depreciation

Rates of Depreciation

Vehicles

20%

Media Films

33%

Standalone Financials

Depreciation has been provided on “Written Down Value” method at rates specified in Schedule XIV to the Companies

Annual Report 2013–14

Corporate Review

Apollo Hospitals Enterprise Limited

4.75

Computers

% 6.33

Office Equipment

4.75

Air Conditioners

4.75

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Consolidated Financials

Furniture and Fittings

b. Pharmacy Sales are recognised when the risk and reward of ownership is ed to the customer and are stated

Assets individually costing up to ` 20,000 are fully depreciated in the year of purchase. Depreciation on assets purchased

net of returns, discounts and exclusive of VAT wherever applicable.

/ disposed off during the year is provided on pro- rata basis with reference to the date of addition / deletion.

c. Hospital Project Consultancy income is recognised as and when it becomes due, on percentage completion

Quintiles Phase One Clinical Trials India Private Limited

method, on achievement of milestones.

Depreciation on tangible assets is provided at the rates prescribed in Schedule XIV to the Companies Act, 1956, or

d. Income from Treasury Operations is recognised on receipt or accrual basis whichever is earlier.

at the rates determined based on the useful life of the assets, as estimated by the management, whichever is higher.

e. Interest income is recognised on a time proportion basis taking into the principal amount outstanding and

basis of useful life of tangible assets are as follows:

the rate applicable. Rate of Depreciation

f.

(p.a)

Royalty income is recognised on an accrual basis in accordance with the of the relevant agreement.

Hospital Equipment

15%

Computers

20%

Office Equipment

15%

Alliance Medicorp (India) Limited

Furniture

15%

Dialysis income is recognized as and when the related services are performed.

Vehicles

20%

Corporate Review

Depreciation is provided based on the Straight Line Method. The rates adopted for depreciation determined on the

Asset

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

g. Dividend income is recognised as and when the owner’s right to receive payment is established.

Apollo Health and Lifestyle Limited Leasehold Improvements are amortized over the primary period of lease i.e. 5 years. Revenue is recognized to the extent that it is probable that the economic benefits will flow to the company and the

Statutory Section

Other income is ed on accrual basis except where receipt of income is uncertain. Fixed assets costing less than ` 5,000 and mobile phones are depreciated fully in the year of purchase.

revenue can be reliably measured. Revenue from services is recognized as per the standard with the customer

Family Health Plan (TPA) Limited

when the related services are performed, with reference to Cradle the One Time License fee is recognized based on

Depreciation has been provided on the written Down Value method as per the rates prescribed in Schedule XIV to the

percentage of Completion method.

Companies Act, 1956 except: Intangible assets (computers software) are amortized at same rate of computers.

The Company has recognized revenue as follows. a. Depreciation is charged on straight line method at the rates prescribed under schedule XIV to the Companies Act,

One Time License Fees

1956 (considered the minimum rate) or at higher rates, if the estimated useful life based on technological evaluation

•

of the assets are lower than as envisaged under Schedule XIV to the Companies Act. In case of additions and deletions during the year, the computations are on the basis of number of days for which the assets have been in

on g the MOU of renewal.

use. Assets costing not more than ` 5,000/- each individually have been depreciated fully in the year of purchase. •

b. When impairment loss / reversal is recognized, the depreciation charge for the asset is adjusted in future periods to

•

Amortisation of Intangible Assets

Owned clinics operational income

Intangible assets are amortised on straight line method over the estimated useful life of the asset.

•

Owned clinics recognizes revenues on the basis of the services rendered on cash or on accrual basis whichever is earlier.

The useful life of the intangible assets for the purpose of amortisation is estimated to be three years.

Corporate services Fee

E. Revenue Recognition

•

a. Income from Healthcare Services is recognised on completed service contract method. The hospital collections of the Company are net of discounts. Revenue also includes the value of services rendered pending final billing in

Corporate services fee is recognized on basis of the services rendered and as per the of the agreement.

Other Incomes

respect of in-patients undergoing treatment as on 31st March 2014.

•

All other incomes are recognized on a pro-rata basis, based on the completion of work and as per the of the agreement.

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Annual Report 2013–14

Operating License Fee is recognized as a percentage of the gross sales.

Standalone Financials

useful life.

ii.

With Reference to Cradle the One Time License fee is recognized based on percentage of Completion method.

Operating License Fee

allocate the asset’s revised carrying amount, less its residual value (if any) on a systematic basis over its remaining

i.

With reference to Clinics 70% of One Time License fee is recognized on g the MOU, 15% on completion of 3 months from date of g MOU and balance 15% on commencing of operation and recognizing 100% of OTLF

Business Review

Indraprastha Medical Corporation Limited

Interest

Quintiles Phase One Clinical Trials India Private Limited

•

Interest income is recognized on a time proportion basis taking into the amount outstanding and the

Income from fixed deposits is recognized on a time proportion basis taking into the amount invested and the

applicable Interest rate. Interest income is included under the head “other income” in the statement of profit and

rate of interest.

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

loss. Family Health Plan (TPA) Limited

All the above incomes are recognized net of service tax or VAT wherever applicable

exclusive of applicable service tax.

Sapien Biosciences Private Limted Revenue from operations is recognized based on services provided and billed as per the of the specific contract.

Indraprastha Medical Corporation Limited

Corporate Review

All the TPA streams of revenue are being recognized on accrual basis. Income from TPA operations is recognized

a. Revenue is recognized on accrual basis. Hospital Revenue comprises of income from services rendered to the out-

Unique Home Health Care Limited

patients and in-patients. Revenue also includes value of services rendered pending billing in respect of in-patients

Income from medical services is recognized net of payment to Medical Staff.

undergoing treatment as at the end of the year. Income from Hostel Receipts is recognized net of payment made towards Hostel Rent and Mess Expenses and is b. Under the “Served from India Scheme” introduced by Government of India, an exporter of service is entitled to

ed on accrual basis.

certain export benefits on foreign currency earned. The revenue in respect of export benefits is recognized on the significant uncertainty as to the amount of consideration that would be derived and as to its ultimate collection.

a.

F. Fixed Assets

(net of service tax) is recognized as income over the contract period or period of risk, whichever is appropriate. Any subsequent revision or cancellation of is ed for in the year in which they occur.



Statutory Section

basis of the foreign exchange earned at the rate at which the said entitlement accrues to the extent there is no

Apollo Munich Health Insurance Company Limited

a. All Fixed Assets are stated at their original cost of acquisition less accumulated depreciation and impairment losses are recognised where necessary (Also refer Note 3 (O) in the Notes forming part of s). Additional

b. Commission on Reinsurance

cost relating to the acquisition and installation of fixed assets are capitalised. Wherever VAT is eligible for input

Commission on reinsurance ceded is recognized as income in the year of cession of reinsurance . Profit

availment, Fixed Assets are stated at cost of acquisition after deduction of input VAT.

commission under reinsurance treaties, wherever applicable, is recognized in the year of final determination of the

b. Capital work – in – progress comprises of and amounts expended on development/acquisition of Fixed Assets that are not yet ready for their intended use at the Balance Sheet Date. Expenditure during construction period directly attributable to the projects under implementation is included under Capital work - in – progress,

c. Deficiency

pending allocation to the assets. Advances paid to acquire fixed assets is included under long term loans and

deficiency is recognized whenever the ultimate amount of expected claims, related expenses and

advance as per revised Schedule VI.

maintenance costs exceeds related sum of carried forward to the subsequent ing period as reserve for unexpired risk.



c. Assets acquired under Hire Purchase agreements are capitalised to the extent of principal value, while finance charges are charged to revenue on accrual basis.

d. Reserve for Unexpired Risk

d. Interest on borrowings, for acquisition of Fixed Assets and exchange fluctuation arising out of foreign

to the succeeding ing period subject to a minimum amount of reserves as required by Section 64V (1) (ii)

borrowings, hither to written off in this Statement of Profit & Loss, and the related revenue expenditure incurred

(b) of Insurance Act, 1938.

for the period prior to the commencement of operations for the expansion activities of the Company are capitalised.

e. Interest / Dividend Income

G. Transactions in Foreign Currencies

Interest income is recognized on accrual basis. Accretion of discounts and amortization of relating to debt securities is recognized over holding /maturity period. Dividend is recognized when the right to receive the dividend



is established

Standalone Financials

Reserve for unexpired risk represents that part of the net ( net of reinsurance ceded) attributable

a. Monetary items relating to foreign currency transactions remaining unsettled at the end of the year are translated at the exchange rates prevailing at the date of Balance Sheet. The difference in translation of monetary items and the realised gains and losses on foreign exchange transactions are recognised in the Statement of Profit

f.

Accretion / Amortization of Discounts/

and Loss in accordance with ing Standard 11 – ‘The Effects of Changes in Foreign Exchange Rates

Accretion of discounts and amortization of relating to debt securities is recognized over holding / maturity

(Revised 2003)’, as notified under the Companies (ing Standards) Rules, 2006 (Also refer Note 25 (a)

period.

in the Notes forming part of s).

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Annual Report 2013–14

Business Review



profits and as intimated by the reinsurer.



b. Exchange differences arising on settlement or restatement of foreign currency denominated liabilities borrowed

down value (in case of other than temporary diminution) and current Investments are shown at cost or market value

for the acquisition of Fixed Assets, hither to recognized in the Statement of Profit and Loss are now capitalised

whichever is lower (in case of other than temporary diminution).

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

based on Para 46A of ing Standard 11 – ‘The Effects of Changes in Foreign Exchange Rates (Revised 2003)’.

I.

As per the order of Hon’ble High Court of Karnataka dated 28th January 2014 in the matter of company petition

c. The use of foreign currency forward contract is governed by the Company’s policies approved by the Board

no. 53 & 54 of 2012, M/s. Meera Healthcare Private Limited and M/s. ISIS Healthcare India Private Limited were ordered to be dissolved without winding up and the scheme of Amalgamation has been sanctioned amalgamating both the petitioner companies with M/s. Apollo Health & Lifestyle Limited.

H. Investments

As per ing standard – 14, the amalgamation is in the nature of Merger and accordingly the method of

Investments are classified as current or long term in accordance with ing Standard 13 on ‘ing for

ing adopted is that of “Pooling of Interest”.

Investments’ a. Long-term investments are stated at cost to the Company in accordance with ing Standard 13 on

J. Employee Benefits

‘ing for Investments’. The Company provides for diminution in the value of Long-term investments

Short-term employee benefits (benefits which are payable within twelve months after the end of the period in which

other than those temporary in nature.

the employees render service) are measured at cost.

b. Current investments are valued at lower of cost and fair value. Any reduction to carrying amount and any

Long-term employee benefits (benefits which are payable after the end of twelve months from the end of the period

reversals of such reductions are charged or credited to the Statement of Profit and Loss.

in which employees render service), and post employment benefits (benefits which are payable after completion of employment), are measured on a discounted basis by the Projected Unit Credit Method, on the basis of annual

c. On disposal of an investment, the difference between the carrying amount and net disposal proceeds is

third party actuarial valuations.

charged or credited to the Statement of Profit and Loss.

d. In case of foreign investments,



i. The cost is the rupee value of the foreign currency on the date of investment.



ii. The face value of the foreign investments is shown at the face value reflected in the foreign currency



Defined Contribution Plan

The Company makes contribution towards Provident Fund and Employees State Insurance as a defined contribution retirement benefit fund for qualifying employees.

Company is required to contribute a specified percentage of payroll cost, as per the statute, to the retirement benefit schemes to fund the benefits. Employees State Insurance dues are remitted to the Employees State

Apollo Munich Health Insurance Company Limited

Insurance Corporation.

Investments are made in accordance with the Insurance Act, 1938 and Insurance Regulatory & Development

Business Review

The Provident Fund Plan is operated by the Regional Provident Fund Commissioner. Under the scheme, the

of that country.

Statutory Section



Corporate Review

of Directors. These hedging contracts are not for speculation.



ing For Amalgamation

Authority (Investment) Regulations, 2000, as amended from time to time. Investments are recorded at cost including acquisition charges (such as brokerage, transfer stamps) if any, and exclude interest paid on purchase.



Debt securities, including Government securities are considered as held to maturity and are stated at historical cost

For Defined Benefit Plan the cost of providing benefits is determined using the Projected Unit Credit Method with

adjusted for amortization of and/or accretion of discount over the maturity period of securities on straight

actuarial valuation being carried out at each Balance Sheet date. Actuarial Gains or Losses are recognised in full in

line basis.

the Statement of Profit and Loss for the period in which they occur. a.

calculation of fair value, the lowest value of the last quoted closing price of the stock exchanges is considered

The Company makes annual contributions to the Employees’ Group Gratuity-cum-Life Assurance Scheme of the

wherever the securities are listed. Unrealized gain/losses due to change in fair value of listed securities is credited

ICICI and Life Insurance Corporation of India, for funding the defined benefit plan for qualifying employees which is

/ debited to ‘Fair Value Change ’, Investments in Units of Mutual funds are stated at fair value being the

recognised as an expense. The Scheme provides for lump sum payment to vested employees at retirement, death

closing Net Asset Value (NAV) at Balance Sheet date. Unrealized gains/losses are credited /debited to the ‘Fair

while in employment, or on termination of employment of an amount equivalent to 15 days salary payable for each

Value Change ’

completed year of service, or part thereof in excess of six months. Vesting occurs upon completion of five years of service. The Company restricts the payment of gratuity to the employees below the rank of General Managers

Future Parking Private Limited

to the limits specified in the payment of Gratuity Act, 1972. However the Company complies with the norms of

Investments are classified as long-term and current investments. Long-term investments are shown at cost or written

ing Standard 15.

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Annual Report 2013–14

Gratuity

Standalone Financials

Listed and actively traded securities are measured at fair value as at the Balance Sheet date. For the purpose of

Defined Benefit Plans

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | b. Leave Encashment Benefits

K. Segment Reporting

The Company pays leave encashment benefits to employees as and when claimed, subject to the policies of the



Company. The Company provides leave benefits through Annual Contribution to the fund managed by HDFC Life.

Identification of Segments

The Company has complied with ing Standard 17- ‘Segment Reporting’ with Business as the primary segment.

Imperial Hospital & Research Centre Limited

are regulated under the Drug Control Act, which applies uniformly all over the Country. The risk and returns of

The Company has made contribution towards a recognized gratuity fund. The provisions made are on the basis

the enterprise are very similar in different geographical areas within the Country and hence there is no reportable

of actuarial valuation. The following are recognized in the financial statement -

secondary segment as defined in ing Standard 17. ` in million

8.05

Current Service Cost

2.47

Closing balance of the Planned Asset

0.30

Interest on Planned Asset

0.01

Provisions during the year

0.37



Segment Policies

The ing policies adopted for segment reporting are in line with the ing policies adopted in consolidated financial statements with the following additional policies for Segment Reporting:

a. Revenue and expenses have been identified to segments on the basis of their relationship to the operating activities of the segment. Revenue and expenses, which relate to the enterprise as a whole and are not

b.

allocable to segments on a reasonable basis, have been included under “unallocable expenses”.

Provident Fund

The Company is ed with the jurisdictional Provident Fund Commissioner for provident fund benefits and is



contributing to the fund as per prescribed law. The contributions to the Provident fund are ed on accrual

b. Inter segment revenue and expenses are eliminated.

Statutory Section

PV of past services benefit

Corporate Review

The Company operates in a single geographical segment, which is India, and the products sold in the pharmacies,

a. Gratuity

The Company has disclosed this Segment Reporting in Consolidated Financial Statements as per para (4) of

basis.

ing Standard – 17- ‘Segment Reporting’. c.

Leave encashment benefits

L. Lease

As per the company policy, every employee who has worked for a period of not less than 240 days during a



20 days of actual service. The provisions made in the books of are on the basis of actuarial valuation. The

Leases where the lessor effectively retains substantially all the risks and the benefits of ownership of the leased

Company is proposing to open the Group Leave Encashment Fund with the Actuary.

assets are classified as operating leases. Operating lease payments are recognised as an expense in the Statement of Profit and Loss on a straight – line basis over the lease term.

Unique Home Health Care Limited

a. The company is not covered by The Payment of Gratuity Act, 1972 since the number of employees is below

M. Earnings per Share.

the statutory minimum as prescribed by the Act.

In determining the earnings per share, the Company considers the net profit after tax before extraordinary item and

b. The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 is also not applicable to the

after extraordinary items and includes post - tax effect of any extraordinary items. The number of shares used in computing the basic earnings per share is the weighted average number of shares outstanding during the period. For computing diluted earnings per share, potential equity shares are added to the above weighted average

c. The Employees State Insurance Act, 1948 is also not applicable to the Company as the number of employees

number of shares.

is below the statutory minimum.

N. Taxation

d. The Company does not have any leave encashment scheme or sick leave policy.



a. Income Tax

Income tax is computed using the tax effect ing method, where taxes are accrued in the same period

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalised as part

as and when the related revenue and expense arise. A provision is made for Income Tax annually based on

of the cost of such asset. As per ing Standard 16 ‘Borrowing costs’, a qualifying asset is one that takes

the tax liability computed after considering tax allowances and exemptions.

necessarily substantial period of time to get ready for its intended use. All other borrowing costs are expensed as



and when incurred.

b. Deferred Tax

The differences that result between the profit calculated for income tax purposes and the profit as per the

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Consolidated Financials

Annual Report 2013–14

J. Borrowing Cost

Standalone Financials

Company as the number of employees is below the statutory minimum.

Operating Lease

Business Review

calendar year shall be eligible for not less than 15 days privilege leave computed at the rate of one day for every

financial statements are identified and thereafter deferred tax asset or deferred tax liability is recorded for timing

asset is available for use. If the persuasive evidence exists to the affect that useful life of an intangible asset exceeds

differences, namely the differences that originate in one ing period and get reversed in another, based

ten years, the company amortizes the intangible asset over the best estimate of its useful life.

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

on the tax effect of the aggregate amount being considered. Deferred tax asset are not recognized unless there is virtual certainty that sufficient future taxable income will be available against which such deferred tax



Indraprastha Medical Corporation Limited

asset can be realized. The tax effect is calculated on the accumulated timing differences at the beginning of



•

Intangible assets are amortised on straight line method over the estimated useful life of the asset.



•

The useful life of the intangible assets for the purpose of amortisation is estimated to be three years.

this ing year based on the prevailing enacted or substantively enacted regulations.

R. Provisions, Contingent Liabilities and Contingent Assets

The carrying amounts of assets are reviewed at each Balance Sheet date to ascertain if there is any indication of impairment based on internal/external factors. An asset is treated as impaired based on the cash generating

A provision is recognised when the Company has a present obligation as a result of a past event and it is probable

concept at the year end, when the carrying cost of assets exceeds its recoverable value, in of Para 5 to Para

that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable

13 of AS-28 ‘Impairment of Assets’ as notified under the Companies (ing Standards) Rules, 2006 for the

estimate can be made of the amount of the obligation.

purpose of arriving at impairment loss thereon, if any. An impairment loss is charged to the Statement of Profit and

Contingent liabilities are not provided for unless a reliable estimate of probable outflow to the Company exists as at

Loss in the year in which an asset is identified as impaired. The impairment loss recognized in prior ing

the Balance Sheet date. Contingent assets are neither recognised nor disclosed in the financial statements.

periods is reversed if there has been a change in the estimate of the recoverable amount.

The Company is exposed to foreign currency fluctuations on foreign currency loans and payables. The company limits

The Board of Directors approves the Bad Debt Policy, on the recommendation of the Audit Committee, after the review of debtors every year. The standard policy for write off of bad debts is as given below subject to

the effect of foreign exchange rate fluctuations by following established risk management policies including the use of

management inputs on the collectability of the same,

derivatives. The company enters into derivative financial instruments where the counterparty is a bank. All derivatives are effective hedges against an underlying liability and any cash flows are recognised as and when they

% of write off 0

1-2 years

25

2-3 years

50

Over 3 years

100

occur. Attributable transaction costs are recognised in statement of income as cost. Gain/(losses) on settlement of foreign currency derivative instruments relating to borrowings which have not been designated as hedges are recorded in finance expense.

Business Review

0-1 years

T. Insurance – related Policies Q. Intangible Assets

Apollo Munich Health Insurance Company Limited

Intangible assets are initially recognised at cost and amortised over the best estimate of their useful life. Cost of



software including directly attributable cost, if any, acquired for internal use, is allocated / amortised over a period

i. Reinsurance

of 36 months to 120 months.

Reinsurance on ceding of risk is ed in the year in which risk commences and over the period of risk in accordance with the treaty arrangements with the reinsurers. Unearned on reinsurance ceded is carried

Apollo Health and Lifestyle Limited

forward to the period of risk and is set off against related unearned . on excess of loss reinsurance cover is ed as per the reinsurance arrangements.

a rebuttable presumption that the useful life of an intangible asset will not exceed five years from the date when the asset is available for use. If the persuasive evidence exists to the affect that useful life of an intangible asset exceeds

ii. Acquisition Cost of Insurance Contracts

ten years, the company amortizes the intangible asset over the best estimate of its useful life

Costs relating to acquisition of new and renewal of insurance contracts viz commission, etc., are expensed in the year in which they are incurred.

Imperial Hospital & Research Centre Limited

iii. Received in advance

period of 5 years.

received in advance represents received in respect of those policies issued during the year where the risk commences subsequent to the Balance Sheet date.

Family Health Plan Limited

Intangible assets are amortized on a straight line basis over the estimated useful economic life. The company uses a rebuttable presumption that the useful life of an intangible asset will not exceed five years from the date when the

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4

Consolidated Financials

Annual Report 2013–14

Cost of software including directly attributable cost, if any, acquired for internal use, is allocated /amortized over a



Standalone Financials

Intangible assets are amortized on a straight line basis over the estimated useful economic life. The company uses



Statutory Section

S. Derivative Financial Instruments

P. Bad Debts Policy

Period

Corporate Review

O. Impairment

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | iv. Claims Incurred

4. Share Capital

Estimated liability in respect of claims is provided for the intimations received upto the year end based on, assessment

(` in million)

made by Third Party (TPA). Information provided by the insured and judgment based on the past

Particulars

experience. Claims are recorded in the revenue , net of claims recoverable from reinsurers / coinsurers to the extent there is a reasonable certainty of realization. These estimates are progressively re-valued on availability of further

Authorised

information.

200,000,000 (2012-13:200,000,000) equity shares of ` 5/- each

1,000.00

100.00

100.00

v. Claims incurred but not reported (IBNR) and claims incurred but not enough reported(IBNER) IBNR represents that amount of claims that may have been incurred prior to the end of the current ing period

Issued

1,100.00

1,100.00

but have not been reported or claimed. The IBNR provision also includes provision, if any, required for claims incurred

139,658,177 ( 2012-13 : 139,658,177) equity shares of ` 5/- each

698.29

698.29

but not enough reported. IBNR and IBNER liabilities are provided based on actuarial principles and certified by the

Subscribed and Paid up

Appointed Actuary. The methodology and assumptions on the basis of which the liability has been determined has

139,125,159 (2012-13 :139,125,159) equity shares of ` 5/- each fully

695.63

695.63

also been certified by the Actuary to be appropriate, in accordance with guidelines and norms issued by the Actuarial

paid up

Corporate Review

1,000.00

1,000,000(2012-13 : 1,000,000) Preference Shares of ` 100/- each

Society of India and in concurrence with the IRDA.

Amount 31.03.2013

Amount 31.03.2014

Reconciliation of the number of shares

Particulars

Investment income is apportioned to Statement of Profit & Loss and Revenue in the ratio of average of shareholder’s funds and policy holders’ funds at the end of each month.

Shares outstanding at the beginning of the year

vii. Fair Value Change

Shares Issued to IFC on conversion of FCCB Bonds

‘Fair Value Change ’ represents unrealized gains or losses due to change in fair value of traded securities and

Shares Issued on Conversion of Share warrants

mutual fund units outstanding at the close of the year. The balance in the is considered as a component of

Shares outstanding at the end of the year

31.03.2014

31.03.2013

Equity Shares

Equity Shares

Number

Amount (` in million)

Number

Amount (` in million)

139,125,159

695.63

134,466,618

672.33

-

-

1,381,619

6.91

-

-

3,276,922

16.38

139,125,159

695.63

139,125,159

695.63

Statutory Section

vi. Allocation of Investment Income

shareholder’s funds and not available for distribution as dividend. Equity shares: The Company has one class of equity shares having a par value of ` 5 per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution

Profit or loss on sale / redemption of investments, being the difference between sale consideration / redemption value and carrying value of investments is credited or charged to Statement of Profit and Loss. The profit / loss on sale of investments include accumulated changes in the fair value previously recognized in ‘Fair Value Change ’ in

Business Review

Rights, Preferences and Restrictions attached to shares viii. Profit / Loss on Sale / Redemption of Investments

of all preferential amounts, in proportion to their shareholding.

respect of a particular security.

Shareholders Holding more than 5% of Total Paid Up Capital ix. Long Term / Short Term Investments

31.03.2014 Name of the Shareholder

to dispose off within twelve months from the date of acquisition are classified as short term investments. Other investments are classified as long term Investments.

Equity Shares No. of Shares held

Equity Shares

% of Holding

No. of Shares held

% of Holding

PCR Investments Ltd  

27,223,124

19.57

21,313,124

15.32

Integrated Mauritius Healthcare Holdings Ltd  

15,093,860

10.85

15,093,860

10.85

Oppenheimer Developing Markets Fund

11,678,894

8.39

10,507,859

7.55

-

-

4,417,069

3.17

HSTN Acquisition (FII) Limited.

Standalone Financials

Investments maturing within twelve months from the Balance Sheet date and investments made with specific intention

31.03.2013

Annual Report 2013–14

a. The Parent Company had issued 9,000,000 Global Depository Receipts of ` 10 (now 18,000,000 Global Depository Receipts of ` 5) each with two way fungibilty during the year 2005-06. Total GDR’s converted into each and total equity shares converted back to GDR for the year ended 31st March 2014 is 439,944 (201213 : 10,949) of ` 5 each. Total GDR’s converted into equity shares upto 31st March 2014 is 25,079,178 (2012-13 : 24,931,729) of ` 5 each.

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4

Consolidated Financials

underlying Equity Shares for the year ended on 31st March 2014 is 147,449 (2012-13 : 4,597,869) of ` 5

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

5. Reserves and Surplus Particulars

a.

b.

d.

e.

g.

(-) Transfer to Reserves (-) Transfer to Debenture Redemption Reserve Closing Balance Total

155.25 155.25

155.25 155.25

2.62 2.62

2.62 2.62

60.02 60.02

60.02 60.02

17,599.55 11.25 17,610.80

15,633.19 1,942.86 23.50 17,599.55

800.00 12.50 812.50

170.00 630.00 800.00

6,249.03 1,500.00 4.52 217.36 7.63 0.19 508.61 8,487.34

5,249.03 1,000.00 9.82 166.19 500.39 6,925.43

7.63 7.63 0.11

7.63 7.63 0.02 0.04

0.19 0.19 -

0.19 0.19

1,202.91 3,169.60 799.97 135.95

714.72 21.66 3,035.08 765.19 130.04

1,500.00 12.50 1,924.09 29,071.17

1,000.00 630.00 1,202.91 26,772.10

(a)

Secured Non-convertible Debentures 1,000 (2012-13: 1,000) 10.3% Debentures of ` 1,000,000/- each 940 (2012-13: 940) 10.15% Debentures of ` 1,000,000/- each

(b)

31.03.2013

1,250 (2012-13: 1,250) 9.8% Debentures of ` 1,000,000/- each Term loans From Banks (i) HDFC Bank Limited (ii) Yes Bank (iii) ICICI (iv) Indus Ind Bank Ltd - Chennai From Other parties IFC Loan (External Commercial Borrowings) IFC Loan (External Commercial Borrowings) HSBC (External Commercial Borrowings) HSBC (Bills Payable ) Total Add: Share of t ventures Total Unsecured (i) Deposits Fixed Deposits (ii) Other loans and advances Bank of Tokyo Mitsubishi UFJ (External Commercial Borrowings) Total Add : Share of t Ventures Total

1,000.00

1,000.00

940.00

940.00

1,250.00

1,250.00

1,453.24 114.54 400.00 383.23

1,164.25 1,058.90 200.00 -

965.27 1,636.80 1,246.60 504.58 9,894.26 608.26 10,502.52

1179.77 1,636.80 1,355.00 141.86 9,926.58 648.27 10,574.85

335.95

180.83

1328.20 12,166.67

10,755.68

57.13 12,223.80

33.32 10,789.00

Apollo Hospitals Enterprise Limited a. 10.30% Non Convertible Debentures The Company issued 500 Nos. 10.30% Non Convertible Redeemable Debentures of ` 1 million each on 28th December 2010 with an option to re-purchase/re-issue some or all of its debentures in the secondary market or otherwise, at any time prior to the specified date of redemption of 28th December 2020 and 500 Nos. 10.30% Non-Convertible Redeemable Debentures of ` 1 million each on 22nd March 2011 which will be redeemed on 22nd March 2021 to the Life Insurance Corporation of India. b. 10.15% Non Convertible Debentures The Company issued 1000 Nos. 10.15% Non Convertible Redeemable Debentures of ` 1 million each on 22nd March 2012 with an option to re-purchase/re-issue some or all of its debentures in the secondary market or otherwise, at any time prior to the specified date of redemption of 22nd March 2017. The Company had redeemed debentures amounting to ` 60 million last year as per the and conditions of the issue and the residual debenture of ` 940 million is outstanding as of 31st March 2014.

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4

Consolidated Financials

Annual Report 2013–14

h.

18.44 18.44

31.03.2014

Standalone Financials

i. j. K.

18.44 18.44

(` in million) Particulars

Business Review

h.

31.03.2013

Statutory Section

f.

31.03.2014

Corporate Review

c.

Capital Reserves Opening Balance Closing Balance Capital Reserve on Consolidation Opening Balance Closing Balance Capital Fund Opening Balance Closing Balance Capital Redemption Reserve Opening Balance Closing Balance Securities Opening Balance Add : Securities credited on Share issue Add : Share from Group Companies Closing Balance Debenture Redemption Reserve Opening Balance (+) Current Year Transfer Closing Balance General Reserve Opening Balance (+) Current Year Transfer (+) Share of Associates (+) Share of Profits / ( Loss ) Subsidiaries (+) Transfer from Investment allowance reserve (+) Transfer from Foreign exchange fluctuation reserve (+) Profit from t Ventures Closing Balance Investment Allowance Reserve Opening Balance (-) Transfer to General reserve Closing Balance Foreign Currency Translation Reserve J. Fair value change Foreign Exchange fluctuation Reserve Opening Balance (-) Transfer to General reserve Closing Balance Surplus Opening balance (-) Dividend paid on FCCB loan and Share Warrants (+) Net Profit/(Net Loss) For the current year (-) Proposed Dividend on Equity Shares for the year (-) Dividend Distribution Tax on Proposed dividend on Equity Shares

6. Long Term Borrowings

(` in million)

c. 9.80% Non Convertible Debentures

h. Bank of Tokyo – Mitsubishi UFJ (External Commercial Borrowings)

The Company issued 1,250 Nos. 9.80% Non Convertible Redeemable Debentures of ` 1 million each on 11th

Bank of Tokyo has granted an unsecured loan of US$ 20 million during the year 2013-14 and the same loan has

July 2012 with an option to re-purchase/re-issue some or all of the debentures in the secondary market or

been hedged at ` 66.41 per US$ with HSBC. The Company has entered into a Currency Cum Interest Rate Swap

otherwise at any time prior to the specified date of redemption of 11th July 2017 to First Rand Bank Limited.

(CCIRS) with HSBC Bank Ltd in Indian Rupee for Interest rate and foreign currency fluctuation risk.

The Debentures stated above in point (a),(b) &(c) are secured by way of pari u first charge on the fixed assets

7. Deferred Tax Liabilties

least a cover of 1.25 times the value of the outstanding principal amount of the loan.

The deferred tax for the year recognized in the Statement of Profit and Loss of the group comprises: (` in million)

d. HDFC Bank Limited

Particulars Deferred Tax Liability recognized in the statement of Profit or loss

The Company has availed Rupee Term Loan of ` 1,300 million from HDFC Bank Limited, which is repayable in twenty quarterly instalments commencing from September 2013 and interest payable @ 11% pa. The loan is

Deferred Tax Asset recognized in the statement of Profit or loss

secured by first pari u charge on all present and future movable and immovable fixed assets of the company

31.03.2014 995.74

31.03.2013 743.34

0.39

6.44

The accumulated deferred tax liability/(asset) of the group as on 31st March 2014 comprises:

along with minimum cover of 1.25 times the value of the outstanding principal amount of the loan.

The Company was sanctioned a sum of US$ 35 million from International Finance Corporation, Washington by

I

way of External Commercial Borrowings (ECB). The Company has withdrawn the full amount of US$ 35 million

Particulars Deferred Tax Liability On of Depriciation On of Deferred Revenue Expenditure

as of 31st March 2012 on the above loan. The ECB loan is secured by way of pari u first ranking charge on the fixed assets owned by the Company such pari u charge ensuring atleast a cover of 1.25 times the value of the outstanding principal amount of the loan. The Loan is repayable in 15 equal semi-annual Instalments starting from 15th September, 2012. During the year two instalments of US$ 2,333,333 each were repaid on 15th September 2013 and 15th March 2014. II of pari u first ranking charge on the fixed assets of the company ensuring atleast a cover of 1.25 times the

31.03.2013

1,256.00 31.67

1,139.32 51.25

2,244.59 (13.15) 3,519.11

1,355.13 2,545.70

228.17 228.17

251.45 251.45

value of the outstanding principal amount of the loan. Note: amount shown within brackets represents deferred tax asset. The Company entered into a Currency Cum Interest Rate Swap (CCIRS) with HDFC Bank Limited in Indian Rupee and hedged the loan for interest and foreign currency fluctuation risk. The derivative contract is secured

Business Review

The company was granted a further loan of US$ 30 million in the year 2012-13.The ECB loan is secured by way

(Deferred Tax Assets) On of 35Ad Others Total Deferred Tax Assets On of Unabsorbed Losses and Depreciation Total

31.03.2014

Statutory Section

(` in million)

e. International Finance Corporation (External Commercial Borrowings)

Alliance Medicorp ( India ) Limited

by a second charge on the immovable assets of the Company to the extent of ` 1,100 million. The tenure of this

The Net Deferred Tax Asset, on of Carry forward losses and Unabsorbed Depreciation is not recognized in the

derivative contract matches with the tenure of the loan outstanding as of 31st March 2014.

books of s, on prudence.

HSBC (External Commercial Borrowings)

Apollo Munich Health Insurance Company Limited

The company has drawn a loan of US$ 25 million from HSBC in the year 2012-13. The Company entered into

The Company has carried out its deferred tax computation in accordance with the mandatory ing Standard,

a Currency Cum Interest Rate Swap (CCIRS) with HSBC Bank in Indian Rupee and hedged the loan for interest

AS 22 - ‘Taxes on Income’ issued by the Institute of Chartered ants of India. There has been a net deferred tax

and foreign currency fluctuation risk. The ECB loan is secured by way of pari u first ranking charge on the

asset amounting to ` 1,200.84 million (Previous Year `1,032.82 million) on of accumulated losses. However,

fixed assets of the Company.

as a principle of prudence, the Company has not recognized deferred tax assets in the financial statements for the year

Standalone Financials

f.

Corporate Review

of the Company, existing and future along with Bank and Institutions; such pari u first charge ensuring at

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

ended 31st March 2014. The Company has availed a buyer’s line of credit of USD 8.40 million(PY: USD 2.61 million), for the equipment imported. The loan is secured by first pari u ranking charge on the entire existing and future movable fixed asset of the company with minimum cover of 1.25 times the value of the outstanding principal amount of the loan. (previous year it was given in INR)

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4

Consolidated Financials

Annual Report 2013–14

g. HSBC (Buyer’s Line of Credit)

8. Other Long Term Liabilities

(f) (` in million)

(a)

31.03.2014

31.03.2013

15.74 0.88 16.61 20.91 37.52

25.75 1.92 27.67 18.88 46.55

9. Long Term Provisions (a)

31.03.2014 9,37 5.65 15.02 6.98 22.00

(` in million) 31.03.2013

296.86 4.60 205.61 13.93 2.31 123.89 567.11 1.92 2,235.64 663.89 2,899.53

Apollo Hospitals Enterprise Limited During the year, the amount transferred to Investors Education and Protection Fund of the Central Government as per the provisions of Section 205A and 205C of the Companies Act, 1956 is ` 1.97 million (` 1.60 million) in aggregate

14.58 7.02 21.60 6.26 27.86

Statutory Section

Particulars Provision for employee benefits Gratuity (Unfunded) Leave Encashment (Unfunded) Total Add: Share of t Ventures Total

159.39 3.03 201.75 14.93 6.80 134.96 733.51 1,972.54 790.50 2,763.04

Corporate Review

Particulars Others Rent Deposits Other Deposits Total Add : Share of t Ventures Total

Other payables Sundry Creditors Others Retention Money on Capital Contracts Inpatient Deposits Rent Deposits Other Deposits Tax Deducted at Source Outstanding Expenses Wealth Tax Total Add: Share of t Ventures Total

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

which comprises of ` 1.97 million (` 1.59 million) as unpaid dividend and ‘Nil’ (` 0.01 million) as unpaid deposit.

12. Short Term Provisions (` in million)

10. Short Term Borrowings Particulars

(i)

(` in million) 31.03.2013

26.31 144.27 148.31 98.51 33.10

5.81

31.03.2013

207.08 184.48 391.56

171.14 108.48 279.62

799.97 135.95 935.92 1.75 1,329.23

765.19 130.04 895.23 0.09 1,174.94

151.37 301.55 277.22 578.77

Standalone Financials

5.17 429.35 195.66 625.01

118.06

31.03.2014

Business Review

(i)

Secured Loans repayable on demand from banks State Bank of Travancore Canara Bank Yes Bank Ltd Indus Ind Bank Ltd - Chennai Axis Bank Unsecured Deposits Fixed Deposits Total Add : Share of t Ventures Total

31.03.2014

Particulars (a) Provision for employee benefits Bonus Gratuity & EL Total (b) Others For Dividend - Equity Shares For Dividend Distribution Tax - Equity Shares Total Add : Share of t Ventures Total

11. Other Current Liabilities

(a) (b) (c) (d) (e)

Particulars Current maturities of long-term debt Interest accrued but not due on borrowings Income received in advance Unpaid dividends Unpaid matured deposits and interest accrued thereon

31.03.2014 594.77 93.88 25.12 4.40

31.03.2013 763.25 180.92 29.58 22.27 25.31

188

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4

Consolidated Financials

Annual Report 2013–14

(` in million)

26.85

Wind Electric Generator

24,765.58

Previous Year

191

292.81

Previous Year

81.31

73.65

344.85

63.46

306.01

10.19

7.77

55.69

Additions

22.34

283.67

April 1, 2013

as at

2,849.46

7,108.55

2,010.13

2014

March 31,

Balance as at

26.85

41.76

58.76

3.50

77.76

1,602.71

2,597.01 464.06 1,326.16

1,546.31

3,437.19

29.27

7.35

-

7.35

5.13

2.22

344.85

411.15

49.03

362.12

24.98

96.76

158.52

25.82

132.70

3.03

2013 129.67

April 1,

March 31, 2014 337.14

as at

Balance

-

1,345.95

1,593.63

163.68

1,429.95

1,429.95

-

1.37

1.13

-

1.21

50.75

152.21 38.29 110.07

226.31

578.82

100.35

169.44

the year

charge for

Depreciation

73.91

77.21

4.77

72.44

4.11

12.15

2.53

(0.01)

-

2.54

disposals

for the year 68.33

On

Amortization

0.40

0.00

Impairments

-

-

-

-

-

Impairments

142.27

337.61

5.19

332.42

332.42

-

0.21

-

-

-

(0.67)

12.79 6.19 3.86

2.11

307.77

0.16

-

-

On disposals

Accumulated Depreciation

Accumulated Depreciation

6,199.55

7,403.63

1,034.00

6,369.63

0.28

6,369.91

11.60

9.28

13.83

1.16

8.29

416.84

682.20 151.01 591.18

386.73

3,281.36

262.66

553.77

-

April 1, 2013

Balance as at

as at

Balance

383.65 29,170.18

751.99 33,795.17

8.43

743.56 30,357.98

0.00

743.56 30,357.98

-

0.65

-

-

-

1.04

49.06 16.43 10.19

22.87

446.57 10,644.96

196.75

Deletions

Deletions

Gross Block

4,788.25

5,376.98

268.01

5,108.97

0.00

38.84

Consolidated Financials

Share of t Ventures Total

Trademark and concept rights Total

Computer Software

Fixed Assets

Balance

-

3.26

5.16

0.60

5,108.97

14. Intangible Assets

29,170.18

3,177.61

Total

Share of t Ventures

25,992.57

25,992.57

39.15

Refrigerators

Total Less Depreciation written Back Total

53.60

2.90

1.18

76.58

427.67 91.73 194.87

2,218.40 388.76 1,141.48 259.74

363.70

1,205.48

1,344.01

1,606.12

Kitchen Equipment

Boilers

Others Electrical Installations & Generators Fire fighting Equipment

Medical Equipment & Surgical Instruments Air Conditioning Plant & Air Conditioners Furniture and Fixtures Vehicles Office equipment 9,485.41

826.85

2,219.36

Plant and Equipment

1,137.14

1,819.18 5,971.41

190.95

Additions

Land

April 1, 2013

Balance as at

Gross Block

Buildings Leasehold Improvements

Tangible Assets

Fixed Assets

13. Tangible Assets

Annual Report 2013–14

Standalone Financials

4 Business Review

Contents

Statutory Section

3

March 31,

Balance as at

15.25

31.32

43.80

2.34

68.26

1,134.45

1,775.39 280.95 628.77

935.38

7,092.55

15.25

29.87

39.77

1.74

68.29

927.17

1,536.20 237.75 550.30

818.75

6,204.05

1,956.70

5,417.64

1,819.18

April 1, 2013

Balance as at

(0.28)

0.28

2,244.70

2,143.61

158.52

233.20

30.60

202.60

7.14

2014 195.46

March 31,

as at

186.33

177.95

18.43

159.52

17.84

2014 141.68

March 31,

as at

Balance

Net Block Balance

196.05

186.33

13.02

173.31

19.31

154.00

April 1, 2013

as at

Balance

(` in million)

7,403.63 21,766.55 18,566.03

8,659.65 25,135.52 21,766.55

1,192.49

7,467.16 22,890.82 19,622.94

0.28

7,467.44 22,890.54 19,622.66

11.60

10.44

14.96

1.16

9.50

468.26

-

821.62 183.11 697.39

610.93

3,552.41

-

2,486.61

6,385.34

362.85

2,010.13

-

2014

(` in million) Net Block

723.21

2014

March 31,

Balance as at

Corporate Review

190

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Performance Highlights

610.23

Yes Unquoted

Fully Paid

853.44

171.11

-

Yes 35.89 Fully Paid

5,606,548

-

Unquoted -

Total

Private Limited

Rajshree Hospital and Research Centre

Investments in Preference Shares

Others

10

1,175,982 10 Others Rajshree Hospital and Research Centre

Private Limited

Yes

Yes 95.30

1.73 1.73

95.97 Fully Paid

Fully Paid Unquoted

Unquoted 240,196

157,500 157,500

240,196 1 Associate Stemcyte India Therapautics Private Limited

10

20,190,740 20,190,740 10 Associate Indraprastha Medical Corporation Limited

Others

Fully Paid Quoted

(6) (5) (4) (3) (2) (1) Investement in Equity Instruments

Kurnool Hospital & Enterprises Limited

Yes 513.20 548.74

(8) (7)

As at 31 As at 31st

March 2014

March 2013

(9)

Yes/No

at Cost

Amount Fully paid

Partly Paid / Quoted /

193

3

Contents

4

Consolidated Financials

Annual Report 2013–14

Standalone Financials

192

As at 31

1,479.54

March 2013

963.69

1,660.66

As at 31st

1,099.27

Total

March 2014

(b)

million 2012-13:` 660.24 million) Aggregate amount of unquoted investments

Entity / Others

Aggregate amount of quoted investments (Market value ` 784.41

A) Details of Trade Investments

(a)

Unquoted

31.03.2013 515.35

/ Units

31.03.2014 561.39

No. of Shares

75.44 22.00 0.20 97.64 707.87 385.35 386.32 1,479.54

/ Units

175.81 22.00 10.00 0.17 207.98 1,061.42 109.93 489.31 1,660.66

No. of Shares

610.23

Business Review

610.23

171.11 853.44

Face Value

Particulars

682.33

JV/ Controlled

(a) (b) (c) (d)

Investments in preference shares Total (A) Other Investments (Refer Table B below) Investment in Equity instruments Investment in Preference Shares Investments in debentures or bonds Investments in Government or Trust securities Total (B) Grand Total (A + B) Advance for Investment Add : Share of tventure Total

31.03.2013

Name of the Body Corporate

(a) (b)

31.03.2014



(` in million)

Particulars Trade Investments (Refer Table A below) Investment in Equity instruments

Statutory Section

stated

16. Non Current Investments

Corporate Review

Amount

* Includes Interest on Borrowings Capitalised for the year ended 31st March 2014 of ` 341.12 million (` 252.00 million).

Associate /

` 529.13 million (` 377.39 million)*.

Whether

(` in million)

15. Capital Work –in-Progress ` 4,913.06 million (` 4,033.93 million) comprises amounts spent on assets under construction and directly related pre-operative expenses. The amount of interest included in capital work in progress is

Subsidiary /

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Associate /

Others

Others

Others

Others

Others

Others

Others

Others

Others

Others

Others

Others

Others

Associate

Entity / Others

JV/ Controlled

1,232,500 1,571,250 75,000 36 935,000 406,514 10,000

10 10 10 1,000 54.10 1,000

1,000

10 10

200 12,811

10 10

490,000 157,500

10

31.03.2014

/ Units

No. of Shares

10

Face Value

-

-

406,514

-

-

-

-

-

78

1,000

12,811

200

157,500

490,000

31.03.2013

/ Units

No. of Shares

Quoted /

Unquoted

Quoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Unquoted

Quoted

Quoted

Unquoted

Unquoted

Unquoted

Unquoted

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

Fully Paid

207.98

0.17

10.00

22.00

27.43

13.61

0.75

15.71

12.33

0.00

0.16

2.49

0.002

1.73

Fully Paid

97.64

0.20

-

22.00

-

-

-

-

-

.

0.16.

2.49

0.02

1.73

72.79

103.33

Fully Paid

Amount

31.03.2013

Amount

31.03.2014

Fully paid

Partly Paid /

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes/No

at Cost

stated

Whether

(` in million)

a.

b. c.

Total Add :Share of t Ventures Total

Particulars Aggregate amount of quoted investments

(Market Value ` 1,466.68 million (2012-13 : ` 3,657.47 million) Aggregate amount of unquoted investments Total

4 1,501.55 1,017.55

1,549.71 484.90 731.27 0.05 716.44 517.29 545.00

2,765.88 4,866.30 234.75 5,101.05

31.03.2014 135.88 10.00 1,400.09 1,545.97 9.04 1,555.01

1778.73 3,490.27 195.47 3,685.74

18. Current Investments 31.03.2013 135.88 10.00 3,621.25 3,767.13 20.46 3,787.59

31.03.2014 1,367.49 31.03.2013 3,580.67

187.52 1,555.01 206.92 3,787.59

195

Standalone Financials

Contents 693.99

Business Review

3 Particulars Investments in Equity Instruments Investments in Debentures Investments in Mutual funds Total Add: Share of t Ventures Total

598.87

Statutory Section

194 31.03.2014

Corporate Review

(a) (b) (c)

Particulars Capital Advances Unsecured, considered good Security Deposits Unsecured, considered good Other Loans and Advances Advance to Suppliers MAT Credit Entitlement Other Advances Advance Income Tax

Consolidated Financials

b. National Saving Certificates shown under investments are pledged with the Chief Ration Officer, Government of Andhra Pradesh.

Gleneagles Hospitals Limited. The pledge has since been cleared on 23rd April 2014.

a. The Company has pledged its 20,775,197 shares in Apollo Gleneagles Hospitals Limited as a security for the loan advanced by IDFC and HDFC to Apollo

Total

National Savings Certificate

securities

Investments in Government or Trust

ECL Finance - Non Convertible Debentures

Investments in Debentures or Bonds

Health Super Hiway Private Limited

Investments in Preference Shares

Cureus Inc (Stanford-US)

Tirunelveli Vayu Energy Generation Pvt Ltd

Indo Wind Power Pvt Ltd

Clover Energy Pvt Ltd

AMG Health care Destination Pvt Ltd

Sunrise Medicare Private Ltd

Cholamandalam DBS Finance Ltd

The Karur Vysya Bank

Health Super Hiway Private Limited

Kurnool Hospitals Enterprises Limited

Family Health Plan Limited

Investement in Equity Instruments

Name of the Body Corporate

Subsidiary /

B) Details of Other Investments

Annual Report 2013–14

17. Long Term Loans and Advances Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

(` in million)

31.03.2013

(` in million)

(` in million)

9,136,630 10,330,899

Others Others

-

Others Others

Total

Reliance Income Fund Retail Plan-Growth Plan-Growth option AIG Short Term Fund Institutional Weekly Dividend Kotak Flexi Debt Scheme Plan A - Growth

1,000 -

Others Others

-

-

-

-

Others

Others

-

Others

HDFC Debt Fund

-

Others

Others

-

Others

DWS Short Maturity - Regular Plan - Growth

-

Others

-

-

Others

Others

-

Others

-

-

Others Others

-

Others

-

-

Others

Others

-

Others

1,386,366

42,553

30,231

2,000,000

1,784,296

1,292,802

2,095,616

1,715,101

183,284

-

182,151

-

4,198,646

1,994,716

-

-

-

-

14,922,589

6,903,598

7,413,063

188,206.244

Others

-

4,681,714

Others

Others

192,148

Others

Reliance Short Term FundGrowth Plan - Growh Option

Pine Bridge India Short Tern Fund Standard Monthly Dividend Canara Robeco Short Term Fund - Regular Growth Pine Bridge India Short Tern Fund Standard Monthly Dividend Canara Robeco Short Term Fund - Regular Growth L028G SBI Magnum Income Fund Regular Plan - Growth L148ig Sbi Term Debt Fund Regular Plan - Growth

Icici Predential Short Term -Regular Plan - Growth Plan

Dws Short Maturity Fund Regular Plan - Growth Idfc Ssif Investment Plan Growth - ( Regular Plan )

Kotak Bond Short Term

Reliance Short Term Fund Growth Plan Sbi Short Term Debt Fund Regular Plan - Growth Reliance Income Fund - Growth Plan Idfc Ssif Medium Term Plan A Growth

Hdfc Income Fund - Growth

-

2,139,907

Others

-

Others

Kotak bond (Short term) Growth

-

Others

Others

IDFC SSIF Short term Plan C Growth

-

-

40,548

30,231

-

-

-

-

-

-

-

-

100,630

-

7,068,212

4,785,788

6,820,507

5,006,183

5,171,166

14,922,589

6,903,598

7,413,063

10,330,899

5,903,031

188,206

4,681,714

192,148

2,139,907

10,203,665

2,316,123

7,848,123

11,950,115

17,435,790

Others

-

11,450,688

14,397,190

8,677,204

10

13,93,079

Others

-

Others

10

928,720

31.03.2013

31.03.2014

-

Others

IDFC SSIF Medium term Plan A Growth ICICI Prudential short term regular Plan Growth Option Canara Robeco short term Fund - regular Growth Reliance Short Term fund Growth Plan ( ST- GP) Canara Robeco short term Fund - regular Growth Kotak Bond Scheme Plan A Growth Dws Premier Bond Fund Regular Plan - Growth

1,000,000

100MUR

Face Value `

No. of Shares / Units

No. of Shares / Units

Others

Others

Others

Kotak bond (Short term) Growth

ICICI Prudential Liquid Plan Daily Dividend Reliance Floating Rate Fund Short Term Plan Growth Plan Reliance Floating Rate Fund Short Term Plan Growth Plan Reliance Dynamic Bond Fund Growth Plan

Investments in Mutual Funds

IFCI Venture Capital funds limited

Investments in Equity Instruments British American Hospitals Enterprises Limited Investments in Debentures

Name of the Body Corporate

Subsidiary / Associate /JV/ Controlled Entity / Others

Details of Current Investments

Annual Report 2013–14

Consolidated Financials

4 Standalone Financials

Contents

Business Review

3 Quoted

Unquoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Quoted

Unquoted

Unquoted

Quoted / Unquoted

Statutory Section

197

Fully Paid

Fully Paid

Fully Paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully Paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully paid

Fully Paid

Partly Paid / Fully paid

1,545.97

20.00

42.60

0.70

20.00

40.00

30.00

30.00

50.00

2.50

50.00

2.50

-

100.00

56.79

100.00

-

-

-

200.00

150.00

-

200.00

200.00

2.50

100.00

2.50

50.00

.

.

.

.

.

.

10.00

135.88

31.03.2014

Amount ( ` in million)

0.70

3,767.13

20.00

40.59

-

-

-

-

-

-

-

-

101.43

100.00

200.00

100.00

150.00

100.00

200.00

200.00

150.00

200.00

200.00

200.00

2.50

100.00

2.50

50.00

200.00

50.00

100.00

250.00

253.54

200.00

250.00

200.00

10.00

135.88

31.03.2013

Amount ( ` in million)

Corporate Review

196 Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Cost

Basis of Valuation

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

ii. Sundry Debtors represent the debt outstanding on sale of pharmaceutical products, hospital services and

19. Inventories

project consultancy fees and is considered good. The group holds no other securities other than the personal

(` in million)

Particulars

31.03.2013

2,162.17 149.46 10.67 257.95 161.08 2,741.33 44.18 2,785.51

1,633.83 132.91 16.75 250.66 110.79 2,144.94 41.89 2,186.83

security of the debtors. iii. Advances and deposits represent the advances recoverable in case or in kind or for value to be realised. The amounts of these advances and deposits are considered good for which the group holds no security other than the personal security of the debtors.

21. Cash and Cash Equivalents (` in million)

Particulars a.

20. Trade Receivables

from the date they are due for payment Unsecured, considered good

31.03.2014

31.03.2013 b

3,332.47 3,332.47

3,067.66 3,067.66

Trade receivables outstanding for a period exceeding six months from the date they are due for payment Unsecured, considered good Unsecured, considered doubtful

Total Add: Share of t Ventures Total

1,576.29 100.28 1,676.57 100.28 1,576.29 4,908.76 288.90 5,197.66

the bankers for obtaining Bank Guarantees and Letters of credit.

1,377.41 70.91 1,448.32 70.91 1,377.41 4,445.07 287.96 4,733.03

22. Short Term Loans and Advances (` in million)

Particulars a.

31.03.2013 3.75 3.75

31.03.2013

52.46 174.58 2,059.07 79.05

2,312.70 2,365.16 42.06 2,407.23

129.27 127.09 1,015.91 69.05

1,212.05 1,341.32 48.42 1,389.74

* Either severally or tly i.

Confirmations of balances from Debtors, Creditors are yet to be received in a few cases though the group has sent letters of confirmation to them. The balances adopted are as appearing in the books of s of the group.

198

199

3

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4

Consolidated Financials

Annual Report 2013–14

31.03.2014 -

Short-term loans and advances Loans and advances to related parties Unsecured, considered good Other Loans and Advances Advance to Suppliers Other Advances Loans and advacne to employees Total Add: Share of t Venture Total

31.03.2014

Standalone Financials

(` in million)

Directors* Other officers of the Company* Firm in which director is a partner* Private company in which director is a member* Total

2,712.29 125.80 2,838.09 362.55 3,200.64

a. The Company’s Fixed Deposit receipts amounting to ` 184.75 million (` 149.35 million) are under lien with

Trade Receivable stated above include debts due by: Particulars

2,166.72 169.76 2,336.48 404.99 2,741.47

1,812.67 659.03 22.27 68.57 149.75

Business Review

Less: Provision for doubtful debts

1,717.01 237.09 25.12 2.75 184.75

31.03.2013

Statutory Section

(` in million)

Particulars Trade receivables outstanding for a period less than six months

a. Balances with banks Current s Deposit s Unpaid Dividend s Margin money Deposits Guarantees Cash on hand* Total Add : Share of t Ventures Total

31.03.2014

Corporate Review

Inventories Medicines (Valued at Cost) Stores and spares (Valued at Cost) Lab Materials (Valued at Cost) Surgical Instruments (Valued at Cost) Other Consumables (Valued at Cost) Total Add: Share of t Ventures Total

a. b. c. d. e.

31.03.2014

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

a. During the year the Foreign Exchange gain (the difference between the spot rates on the date of the

23. Other Current Assets

transactions, and the actual rates at which the transactions are settled) is ` 8.15 million (2012-13 : Foreign

(` in million)

Particulars

31.03.2013

160.29 3.96 35.69 9.53 209.46 112.60 322.07

108.57 3.92 30.75 8.59 151.83 84.43 236.26

Exchange Loss ` 1.41 million).

26. Employee Benefits Expense (` in million) Particulars Salaries and wages Contribution to provident and other funds Employee State Insurance Staff welfare expenses Staff Education & Training Bonus

24. Revenue from Operations (` in million) 31.03.2014 27,341.72 13,648.44 189.05 41,179.21 2,663.00 43,842.21

Total Add : Share of t Ventures Total

31.03.2013 23,974.35 11,016.95 402.98 35,394.29 2,292.77 37,687.06

8.15 196.92 17.73 214.65

347.86 16.82 364.68

Apollo Hospitals Enterprise Limited

Alliance Medicorp ( India ) Limited

•

Samudra Healthcare Enterprises limited

•

Apollo Health and Lifestyle Limited

•

Apollo Lavasa Health Corporation Limited

•

Apollo Gleneagles Hospital Limited

•

Apollo Gleneagles pet – Ct Private Limited

•

Quintiles Phase One Clinical Trials India Private Limited

•

Apollo Hospitals International limited

•

Apollo Munich Health Insurance Company Limited

•

Family Health Plan (TPA) Limited

•

Indraprastha Medical Corporation Limited

Standalone Financials

Net gain on foreign currency transactions and translation Total Add : Share of t Ventures Total

•

Business Review

Interest Income Dividend Income Net gain/(loss) on sale of investments Current investment Long term investment Profit/(Loss) on Sale of Asset

31.03.2013 178.61 57.16 4.22 107.88 -

5,798.76 432.55 6,231.31

under the Companies (ing Standards) Rules, 2006.

(` in million) 31.03.2014 45.20 6.83 136.73 0.01

6,797.85 476.64 7,274.49

The Following Companies in the group have complied with ing Standard 15 ‘Employee benefit’ as notified

25. Other Income Particulars

31.03.2013 4,933.86 314.41 65.47 296.48 14.67 173.87

Statutory Section

Particulars Revenue from Healthcare services Revenue from Pharmacy Revenue from other services Total Add: Share of t Ventures Total

31.03.2014 5,716.21 443.22 82.44 341.02 10.97 203.99

Corporate Review

Other Current Assets Prepaid Expenses Rent Receivables Interest Receivables Franchise Fees Receivable Total Add : Share of t Ventures Total

31.03.2014

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

*For the year ended 31st March 2013, the profit on sale of investments in Apollo Health Street Limited amounting to ` 45.45 million is included and the same is shown under Extraordinary Items.

*For the year ended 31st March 2013, the profit on sale of investments in Apollo Health Street Limited amounting to ` 17.50 million is included and the same is shown under Extraordinary Items.

200

201

3

Contents

4

Consolidated Financials

Annual Report 2013–14

Unique Home Healthcare Limited

In consideration of ing Standard Interpretation (ASI) 15 “Notes to the Consolidated Financial Statements” the

Present value of obligation Fair value of plan assets at the end of

information relating to the above given in the separate financial statements of Parent Company or other companies in the Group is not disclosed.

the year Liability / (assets) Unrecognised past service cost Liability / (assets) recognised in the

Apollo Hospitals Enterprise Limited (` in million) Particulars

Gratuity

282.00 (246.56)

138.55 (79.67)

420.55 (326.23)

79.40 79.40

105.08 105.08

184.48 184.48

35.44 35.44

58.88 58.88

94.32 94.32

for the period Service Cost Interest Cost Expected return on plan assets Actuarial (gain) / loss Past Service Cost Net gratuity cost Investment details of plan assets

Earned Leave

30.87 21.44 (20.13) 47.22 79.40

15.48 9.52 (5.53) 85.61 105.08

46.35 30.96 (25.66) 132.83 184.48

26.24 19.49 (17.46) 7.28 35.55

11.92 8.68 (7.28) 45.55 58.88

38.16 28.18 (24.74) 52.83 94.43

8.00% 6.00%

8.00% 8.00% 8.00% 8.00% 6.00% 8.00% LIC 1994-96 Ultimate Nil Nil Nil Nil 23.00% 23.00% 23.00% 23.00% 8.00% 8.00% 8.00% 8.00% 100% of the plan Assets are invested on debt instruments

2.60

(40.89)

(38.29)

5.06

(24.96)

(19.90)

100% of the plan assets are invested in debt instruments Actual return on plan assets

(` in million) Particulars

As at 31st March 2014 Gratuity Earned Total

As at 31st March 2013 Gratuity Earned Total

Present Value of Obligation as at

282.00

Leave 138.55

420.55

245.90

Leave 112.47

358.37

the beginning of the year Interest Cost Current Service Cost Benefit Paid

21.44 30.87 (27.92)

9.52 15.48 (39.17)

30.96 46.35 (67.09)

19.49 26.24 (4.51)

8.68 11.92 (7.84)

28.18 38.16 (12.35)

Actuarial (gain) / Loss on obligation Present Value of Obligation end of the

29.69 336.08

39.19 163.57

68.88 499.65

(5.12) 282.00

13.82 138.55

8.19 420.55

246.56

79.67

326.23

190.01

102.27

292.28

the period Expected return on plan assets

20.13

5.53

25.66

17.46

7.28

24.74

Contributions Benefits paid Actuarial gain / (loss) Fair Value of Plan Assets as on 31st

35.44 (27.92) (17.53) 256.68

58.88 (39.17) (46.42) 58.49

94.32 (67.09) (63.95) 315.17

56.00 (4.51) (12.40) 246.56

10.20 (7.84) (32.24) 79.67

66.20 (12.35) (44.64) 326.23

i.

Statutory Section

Assumptions Discount Rate Rate of Increase in Salaries Mortality pre- retirement Disability Attrition Estimated rate of return on plan assets Investment details on plan assets

Gratuity

499.65 315.17

balance sheet Gratuity & Leave Encashment cost

as at 31st March 2013

Earned Leave

163.57 -

Corporate Review

as at 31st March 2014

336.08 256.68

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Expected return on plan assets is based on expectation of the average long term rate of return expected on investments of the fund during the estimated term of the obligations. The Gratuity scheme is invested in Gratuity Pay plan offered by ICICI.

promotion and other relevant factors such as demand and supply in the employment market.

Business Review

ii. The estimate of future salary increase, considered in actuarial valuation, take of inflation, seniority,

year Defined benefit obligation liability as at the balance sheet is wholly

March, 2014 Reconciliation of present value of the obligation and the fair value of the plan assets

202

203

3

Contents

4

Consolidated Financials

Annual Report 2013–14

Standalone Financials

funded by the company Change in plan assets Fair Value of Plan Assets beginning of

27. Finance Costs

Royalty paid (` in million)

Particulars

Total Add : Share of t Ventures Total

31.03.2013 784.91

116.42 2.96

108.63 12.68

1,078.71 115.06 1,193.77

906.22 126.28 1,032.50

1.30

789.59

591.00

Miscellaneous expenses

88.59

84.80

Loss on Sale of Asset

34.41

38.99

-

1.41

Total

7,187.59

5,852.92

Add : Share of t Ventures

1,154.73

962.49

Total

8,342.32

6,815.40

Outsourcing Expenses

Exchange loss

a.

Payment to auditors as statutory auditors (` in million)

28. Other Expenses

Particulars (` in million)

Particulars

31.03.2013

Audit Fees*

7.87

12.88

Tax Audit Fees*

1.33

1.62

Power and fuel

778.21

642.20

Certification*

1.58

0.83

House Keeping Expenses

248.06

227.91

Reimbursement of Expenses

0.75

0.43

75.06

57.10

1,286.84

1,119.00

Repairs to Buildings

136.56

136.62

Repairs to Machinery

429.80

322.61

49.03

47.25

345.76

251.61

63.94

47.92

Rates and Taxes, excluding taxes on income

255.10

81.11

Printing & Stationery

226.45

198.01

Postage & Telegram

19.74

19.05

Director Sitting Fees

1.29

1.62

1,065.04

832.69

417.16

322.38

6.33

6.48

Security Charges

123.99

101.51

Sales Tax

Legal & Professional Fees

299.54

323.43

Customs Duty

Continuing Medical Education & Hospitality Expenses

37.80

33.73

Income Tax

Hiring Charges

65.87

53.78

Letter of Credits

7.13

8.41

Telephone Expenses

128.45

109.84

Books & Periodicals

10.67

9.66

Donations

16.91

23.32

178.92

130.00

-

20.18

Repairs to Vehicles Office Maintenance & Others

ment, Publicity & Marketing Travelling & Conveyance Subscriptions

Provision for Bad Debts

(` in million) Particulars

31.03.2014

31.03.2013

246.95

294.54

Bank Guarantees

263.75

384.73

Corporate Guarantees / Letter of comfort

475.00

35.00

0.52

1.04

99.70

99.70

401.09

354.86

-

42.26

1,524.68

1,330.24

51.10

23.34

2.27

2.27

3,065.06

2,567.98

Contingent liabilities and commitments (i)

(to the extent not provided for) Contingent Liabilities (a) Claims against the company not acknowledged as debt (b) Guarantees

(c) Other money for which the company is contingently liable

EPCG Service Tax Value Added Tax

204

205

3

Contents

4

Consolidated Financials

Bad Debts Written off

29. Contingent Liabilities

Standalone Financials

Seminar Expenses

b. Directors travelling included in travelling and conveyance amounts to ` 39.48 million (` 40.54 million).

Business Review

Insurance

*Inclusive of Service Tax @12.36%

Statutory Section

31.03.2013

Rent

Annual Report 2013–14

31.03.2014

31.03.2014

Water Charges

Corporate Review

Interest expense Other borrowing costs Bank Charges Brokerage & Commission

31.03.2014 959.33

1.35

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | (ii)

31. Earnings per Equity Share

Commitments (a) Estimated amount of contracts remaining to be executed on

10,071.27

10,757.41

10,071.27

10,757.41

13,136.33

13,325.39

Particulars

capital and not provided for

31.03.2014

2,980.72

(Amount ` ) (A1) Weighted Averaged Equity Shares outstanding during the year

139,125,159

137,839,092

Family Health Plan (TPA) Limited

(Nos) - (B1) Basic Earnings Per Share before extra-ordinary item - (A1/B1)

22.77

21.62

The Commissioner of Customs, Central Excise and Service Tax-Hyderabad-II Commisionerate vide Adjudication Order

Diluted Earnings before extraordinary items attributable to equity

No.08/2008-Adjn-ST dated 24-03-2008 levied a Penalty u/s. 76 of the Finance Act towards delayed remittance of Service Tax payable (Amount of penalty not quantified). The Company has preferred Appeal against the above Order with The Hon’ble Customs, Excise and Service Tax Appellate Tribunal (South Zonal Bench) – Bangalore and got the Appeal itted and also got the Stay Order from the Hon’ble Court for pre-deposit of penalty. The matter is sub-judice,

-

1,381,619

Promoter Share Warrnats (D1)

-

3,276,922

139,125,159

139,125,159

22.77

21.42

3,167.44

3,043.67

139,125,159

137,839,092

22.77

22.08

3,167.44

3,043.67

shareholders (Amount ` ) (A3) Foreign Currency Convertible Bond issued (C)

-

1,381,619

Promoter Share Warrants(D)

-

3,276,922

139,125,159

139,125,159

22.77

21.88

Weighted Averaged Equity Shares outstanding for Diluted Earnings Per

awaiting final hearing. The Company received a Show Cause Notice from the Income Tax Department during the Financial Year 2009-10

Share. (Nos) - (E1) Diluted Earnings Per Share before extra-ordinary item - (A2/E1)

towards payment of TDS on payments made to the Hospitals on behalf of Insurance Companies along with the Interest

Profit after extraordinary items attributable to equity shareholders

for a period of six preceding financial years based on the CBDT Circular No.08 of November 2009 and amount not quantified.

(Amount ` ) (A) Weighted Averaged Equity Shares outstanding during the year

The company had gone on an appeal against the Show Cause Notice from the Income Tax Department and also CBDT

(Nos) - (B) Basic Earnings Per Share after extra-ordinary item - (A/B)

Circular No.08 of November 2009 in Chennai High Court for applicability of TDS on payments made to Hospitals as

Diluted Earnings after extraordinary items attributable to equity

reimbursement of Expenses. The same was itted and the court granted Stay of Operations of Show Cause Notice and also that of CBDT Circular. Apollo Munich Health Insurance Company Limited

Weighted Averaged Equity Shares outstanding for Diluted Earnings Per

(` in million) Particulars

31.03.2014

31.03.2013

Claims other than against policies, not acknowledged as debts by the

13.90

Nil

company Guarantees given by or on behalf of the company

3.98

3.78

Statutory demands/ liabilities in dispute, not provided for

6.20

7.62

Others*

97.80

109.80

Share. (Nos) - (E) Diluted Earnings Per Share after extra-ordinary item - (A3/E)

Business Review

2,980.72

Statutory Section

3,167.44

shareholders (Amount ` ) (A2) Foreign Currency Convertible Bond issued (C1)

Corporate Review

3,167.44

Total

Profit before extraordinary items attributable to equity shareholders

31.03.2013

32. Related Party Disclosures A. List of Related Parties where control exists and other related parties with whom the Company had transactions and their relationships:

Standalone Financials

*Represents amounts payable on cancellation of a service contract.

In case of other related parties, there are no transactions with the Company.

Indraprastha Medical Corporation Limited In respect of other matters ` 10.05 million (` 55.69 million).

The Parent company has not raised any sum by way of issue of securities during the year 2013-14. Hence disclosure regarding utilisation of amounts from securities issued is not applicable.

206

207

3

Contents

4

Consolidated Financials

Annual Report 2013–14

30. Utilisation of Amounts from Securities Issued

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | SL.No 2

Indraprastha Medical Corporation Limited

3

Stemcyte India Therapautics Private Limited

4

Dr.Prathap C Reddy

5

Smt. Preetha Reddy

6

Smt. Suneeta Reddy

7 8

Nature of Relationship

SL.No

Name of Related Parties

Trac Eco And Safari Park Pvt Limited

45

Ppn Holdings (Alfa) Private Limited

46

Ppn Holdings Private Limited

47

Ppn Power Generation (Unit-1) (P) Limited

Smt. Sangita Reddy

48

PPN Power Generating Company (P) Limited

Smt. Shobana Kamineni

49

Preetha Investments Private Limited

9

Aircel Cellular Limited

50

Sindya Builders Private Limited

10

Aircel Limited

51

Sindya Infrastructure Development Co (P) Limited

11

Apollo Educational Infrastructure Services Limited

52

Sirkazhi Port Private Limited

12

Apollo Energy Company Limited

53

Tharani Energy India Private Limited

13

Apollo Clinical Excellence Solutions Limited

54

Trac India Private Limited

14

Apollo Medskills Limited

55

British American Hospitals Enterprise Limited

15

Apollo Health Resources Limited

56

Universal Quality Services LLC

16

Apollo Mumbai Hospital Limited

57

Sindya Resources Private Ltd, Singapore

17

Apollo Reach Hospitals Enterprise Limited

58

APEX Agencies

18

Apollo Sindoori Hotels Limited

59

APEX Agencies (HYD)

19

Dishnet Wireless Limited

60

Associated Electricatl Agencies

20

Healthnet Global Limited

61

Spectra Clinical Laboratory

21

Indian Hospitals Corporation Limited

62

P. Obul Reddy & Sons

22

Kurnool Hospital Enterprises Limited

63

Sindya Power Generating Company Private Limited

23

Lifetime Wellness Rx International Limited

64

Sindya Holdings Private Limited

24

PCR Investments Limited

65

Kalpathura Enterprises Private Limited

25

Vasumati Spinning Mills Limited

66

Apex Builders

26

Medversity Online Limited

67

Apex Construction

27

AMG Healthcate Destination Private Limited

68

Indian Hospitex Private Limited

28

Apollo Infrastructure Projects Finance Co (P) Limited

69

Kumaranathu and Company

29

Apollo Tele Health Services Private Limited

70

Vaishnavi Consturctions

30

Deccan Digital Networks Private Limited

71

Indo Wind Power Private Ltd

31

Elixir Communities Private Limited

72

Nippo Batteries Company Ltd

32

Faber Sindoori Management Services (P) Ltd

73

Panasonic Home Appliances India Co Ltd

33

Garuda Energy Private Limited

74

Kamineni Builders Private Limited

34

Health Superhiway Private Limited

75

Kamineni Builders

Kalpatharu Infrastructure Development Co (P)

76

Avantha Power & Infrastructure Limited

Limited

77

Bharti Infratel Limited

36

Kei Energy Private Limited

78

Dalmia Cement (Bharat) Limited

37

Kei Rajamahendri Resorts Private Limited

79

Magma Fincorp Limited

38

Kei Vita Private Limited

80

Mahindra & Mahindra Limited

39

Keimed Private Limited

81

Mahindra Worldcity Developers Limited

40

Kei-Rsos Petroleum And Energy Pvt Limited

82

Maschmeijer Aromatics (India) Limited

41

Kei-Rsos Shipping Private Limited

83

PHL Capital Pvt Ltd

Key Management Personnel

Enterprises over which Key Management Personnel are able to exercise significant influence

208

Enterprises over which Key Management Personnel are able to exercise significant influence

209

3

Contents

4

Consolidated Financials

Peninsular Tankers Private Limited

44

Standalone Financials

43

Associates

Nature of Relationship

Business Review

Matrix Agro Private Limited

Statutory Section

42

Corporate Review

Family Healthplan (TPA) Limited

35

Annual Report 2013–14

Name of Related Parties

1

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | SL.No

Name of Related Parties

84

PHL Finance Pvt Ltd Piramal Enterprises Limited Prime Finvest And Leasing Limited

87

Precision Containeurs Limited

88

Sicom Investments & Finance Limited

89

Tata Motors Limited

90

Vas Infrastrcuture Limited (CN)

91

Wipro Limited

92

Yashraj Containeurs Limited

SL.No

Name of Related Parties

118

Green Channel Travel Services (Div of IRM Limited)

119

Cadila Pharmaceuticals Limited

120

Mr.Antony Jacob

121

Onlie Hospital Equipment Services Private Limited

Enterprises over which Key Management

122

Quintiles, Pacific,Inc.,USA Quintiles,Limited.,UK Quintiles,East Asia Private Limited, Singapore

93

Apollo Health Street Limited

Personnel are able to exercise significant

123

94

Aircel Smart Money Limited

influence

124

95

Apollo Healthcare Technology Solutions Limited

96

Apollo Dialysis Private Limited

S.No

Name of Related Parties

Significant Influence (Apollo Hospital International Limited) Significant Control (Apollo Hospital International Limited) Key Management Personnel of Apollo Munich Health Insurance Company Limited Associates of Apollo Health and Lifestyle Limited Subsidiaries of Quintiles Phase One Clinical Trials India Private Limited

Nature of Transaction

Apollo Home Healthcare Limited

98

Apollo Telemedicine Networking Foundation

99

Strides Arcolab Limited

b) Receivables as at year end

100

Garuda Thermal Power Private Limited

c) Transactions during the year

101

Helios Holdings Private Limited

102

LNG Bharat Private Limited

103

Trinitron Healthcare Private Limited

106

Family Health Plan Limited

d) Payables as at year end 2 Significant Control (Alliance Medicorp (India)

Limited

313.58

392.41

108

Emed Life Insurance Broking Services Limited

109

Munchener Ruckversicherung Gesellschaft

110

Sahayadri City Management

111

My City Technology Limited

112

Full Spectrum Adventure Limited

113

Lavasa Corporation Limited

114

Reasonable Housing Limited

115

Hindustan Construction Company

116

Quintiles Mauritius Holding Inc

Stemcyte India Therapautics Private Limited

Insurance Company Limited

b) Receivables as at year end

32.31

32.46

1,669.31

1,529.25

e) Claim Payments

70.60

-

a) Investment in Equity

80.00

80.00

5.47

-

4

Dr. Prathap C Reddy

Remuneration paid

150.50

156.30

5

Smt. Preetha Reddy

Remuneration paid

51.11

52.50

b) Reimbursement of Expenses

6

Smt. Suneeta Reddy

Remuneration paid

51.84

52.50

7

Smt. Shobana Kamineni

Remuneration paid

51.11

52.50

Fellow Subsidiaries of Apollo Lavasa Health

8

Smt. Sangita Reddy

Remuneration paid

51.03

52.50

Corporation Limited

9

Apollo Sindoori Hotels Limited

a) Payables as at year end

12.77

13.92

220.15

2.37

2.01

2.01

22.00

22.00

-

4.56

12.96

-

b) Transaction during the year 10

Ultimate Parent Compnay of Apollo Lavasa Health Corporation Limited

Health Super Hiway Private

a) Investment in Equity

Limited

b) Investment in Preference Shares

Parent Company of Quintiles Phase One

c) Receivables as at year end

Clinical Trials India Private Limited

d) Transaction During the Year 11

9.13

-

a) Payables as at year end

31.31

28.74

Phase One Clinical Trials India Private Limited

Services Private Limited

b) Transactions during the year

296.40

244.12

46.42

17.67

Lifetime Wellness Rx International a) Payables as at year end

1.49

1.09

Limited

6.53

15.61

c) Housekeeping services availed 12

210

b) Transactions during the year

211

3

Contents

4

Consolidated Financials

e) Payables as at year end Faber Sindoori Management

Ultimate Parent Company of Quintiles Quintiles Transnational, USA

21.42

Standalone Financials

Apollo Reach Hospital Enterprise Limited

56.80

-

c) Dividend Received

3

17.52

393.72

Limted)

Associates of Apollo Munich Health

4.90

2.93

Aragonda Apollo Medical & Educational Research Indo German Chamber of Commerce

4.90

393.72

d) Transactions during the year

Foundation

` in million

Indraprastha Medical Corporation a) Investment in Equity

HDFC Ergo General Insurance Company Limited

107

117

a) Investment in Equity

31.03.2013

` in million

Business Review

105

1

31.03.2014

Statutory Section

97

104

Annual Report 2013–14

Nature of Relationship

Corporate Review

85 86

Nature of Relationship

S.No 13 14

Name of Related Parties P. Obul Reddy & Sons Keimed Limited

Nature of Transaction

31.03.2014

31.03.2013

` in million

` in million

a) Transactions during the year

37.04

29.89

b) Receivables as at year end

1.26

0.75

-

16.57

a) Payables as at year end

16 17

Medvarsity Online Limited

Apollo Health Resources Limited Apollo Mumbai Hospital Limited

20

Dishnet Wireless Limited Kurnool Hospitals Enterprise

31.03.2013

` in million

` in million

0.31

-

1.91

-

0.04

0.04

24.08

18.09

0.14

-

b) Receivables as at year end

0.01

-

Emed Life Insurance Broking

a) Payables as at year end

0.07

0.08

Services Limited

b) Expenses for services rendered

12.98

7.50

HDFC Ergo General Insurance

a) Claim Payments

253.29

-

Company Limited

b) Income

754.43

-

37.57

-

279.90

-

Received 30

Sahayadri City Management

AMG Health Care Destination

3,199.16

-

0.94

b) Receivables as at year end

0.24

2.98

b) Expenses towards services

c) Transactions during the year

0.15

0.03

rendered

-

9.88

Receivables as at year end a) Receivables as at year end

7.30

6.87

16.24

18.76

a) Payables as at year end

-

0.31

b) Transactions during the year

-

4.12

a) Payables as at year end

-

0.49

b) Transactions during the year

3.72

2.16

a) Investment in Equity

1.73

1.73

31

32

33 34

Mr.Antony Jacob

a) Income

Munchener Ruckversicherung

a) Losses recovered from

Gesellschaft

reinsurers

c) TPA Fees d) Management Expenses

a) Investment in Equity

12.33

e) Receivables as at year end

12.33 35

Private Limited 22

British American Hospitals

a) Project and Other services Received

Limited 21

a) Project and Other services

a) Investment in Equity

135.88

Online Hospital Equipment

34.06

-

a) Loans and Advance

0.52

0.52

a) Loans & Advances

0.29

-

b) Project and Other services

0.69

-

0.69

-

Services Private Limited

135.88 36

Enterprise Limited

Reasonable Housing Limited

Health Net Global Private Limited

a) Advance Given

1.00

1.00

24

Cadila Pharmaceuticals Limited

a) Payables as at year end

3.42

-

10.85

6.61

a) Transactions during the year

7.98

-

b) Payable as at year end

1.07

-

33. Leases

a) Transactions during the year

0.06

-

In respect of Non- cancellable Operating Leases

b) payable as at year end

0.06

-

a) Payables as at year end

27.64

18.60

b) Transactions during the year

7.00

13.03

a) Operating Income

3.60

0.91

b) Inter Corporate Deposit

8.56

57.89

c) Inter Corporate Deposit Paid

40.00

6.82

d) Interest paid on inter corporate

18.51

17.41

0.32

-

97.24

128.67

8.00

-

25

Green Channel Travel Services (Div of IRM Limited)

26 27

Quintiles Transnational, USA

Lavasa Corporation Limited

c) Current Liabilities

Lease payments recognized in the Statement of Profit and Loss is `1286.84 million (` 1,119 million) (` in million) Particulars

Received

deposit

1,055.88

728.99

Later than one year and not later than five years

3,217.77

1,862.50

Later than five years

6,632.49

4,510.32

lessor and AHEL. Variations/Escalation clauses in lease rentals are made as per mutually agreed and conditions by the lessor and AHEL

outstanding g) Equity Share Capital

Not later than one year

Lease agreements are renewable for further period or periods on and conditions mutually agreed between the

received f) Inter Corporate Deposit

31.03.2013

212

213

3

Contents

4

Consolidated Financials

Annual Report 2013–14

e) Project and other services

31.03.2014

Standalone Financials

28

IRM Enterprises Pvt Ltd

Received

Business Review

23

b) Transactions during the period

Statutory Section

19

Aircell Cellular Limited

31.03.2014

Full Spectrum Adventure Limited

Nature of Transaction

3,698.56

a) Rent received

b) Transactions during the period 18

29

Name of Related Parties

Corporate Review

b) Transactions during the year 15

S.No

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

c. Apollo Munich Health Insurance Company Limited

Apollo Gleneagles Hospitals Limited The Company has certain cancellable operating lease arrangements for residential accommodation and use of

i.

certain medical equipments with tenure extending upto one year. Term of certain lease arrangements include

The company has all the assets within India. All the assets of the company are free from any encumbrances except

option for renewal on specified and conditions, and payment of security deposit etc. Expenditure incurred

deposits in banks amounting to Rs 3.98 million (` 3.78 million). The deposits have been placed with banks for the

on of Operating lease rentals during the year and recognized in the Statement of Profit and Loss amounts

purposes of executing bank guarantees in favour of hospitals towards cash-less arrangements.

to ` 26.81 million (` 19.36 million)

Commitments made and outstanding for: (` in million) Particulars

Apollo Hospitals Enterprise Limited

During the year 2002-03, on a review of fixed assets, certain selected medical equipments were identified and impaired. For the current year, on a review as required by ing Standard 28 ‘ Impairment of Assets’, the management is of the opinion that no impairment loss or reversal of impairment loss is required, as conditions of impairment do not exist.

31.03.2014

31.03.2013

Loans

Nil

Nil

Investments

Nil

Nil

Fixed Assets

30.03

32.08

Corporate Review

ii.

34. Impairment

Encumbrances

iii. Claims, less reinsurance paid to claimants:

Limited had initially invested ` 30 million [` 5 million towards equity and ` 25 million to discharge other liabilities of

Class of Business

AGHL, erstwhile Duncan Gleneagles Hospital Limited (DGHL)] to acquire 50.26% holding in DGHL (subsequently reduced to 49%, now increased to 50%). AGHL assigned an unsecured debt of ` 163.70 million existing in its

Miscellaneous

books to Apollo Hospitals Enterprise Limited, out of which ` 150 million was received till FY 2012-13 and taken to income, leaving a balance unsecured debt of ` 13.70 million. As a measure of prudence the balance amount

In India

Outside India

31.03.2014

31.03.2013

31.03.2014

31.03.2013

3,406.47

2,596.45

11.40

1.63

Statutory Section

(` in million)

35. In the process of acquiring Apollo Gleneagles Hospitals Limited (AGHL) in Kolkata, Apollo Hospitals Enterprise

iv. Age-wise breakup of claims outstanding 

was not recognized as an advance or investment in the books of Apollo Hospitals Enterprise Limited and will be

(` in million)

ed for as and when the amount(s) are received. During the year 2013-14, the balance amount of ` 13.70 Class of Business

million has been received and the same has been duly ed for in the books of s.

Outstanding for six months or less

31.03.2014

31.03.2013

31.03.2014

31.03.2013

31.32

14.93

338.61

229.41

Business Review

Miscellaneous

36. General Information

Outstanding for more than six months

v. Claims settled and remaining unpaid for a period of more than six months:

a. Apollo Hospitals Enterprise Limited On review of the operations of setting up the Hospital in Noida, the Company has re-assigned the lease agreement

Particulars

between itself and the lessor to its associate, Indraprastha Medical Corporation Limited by extinguishing its rights

31.03.2013

Miscellaneous

and privileges in the original lease deed dated 27th October 2001. Unrealised amounts on project development and pre-operative project expenses incurred at Bilaspur Hospital

(` in million) 31.03.2012

Nil

Nil

vi. less reinsurance written during the year: (` in million)

on project will be amortised over the balance lease period of 6 years. The balance yet to be amortised as on

Class of Business

31.03.2014 is ` 18.88 million (` 22.03 million).

Miscellaneous

b. A.B. Medical Centres Limited

Outstanding for more than six months 31.03.2014

31.03.2013

6,506.25

5,261.76

Outstanding for six months or less 31.03.2014

31.03.2013 Nil

No income recognised on “varying risk pattern” basis.

Standalone Financials

amounting to ` 56.62 million are included in advances and deposits . The above expenses incurred

As the Company’s main business is running of a hospital the provisions regarding disclosure of information on Licensed Capacity, Installed Capacity, Production and Sales particulars do not applicable.

Class of Business

Miscellaneous

214

Risk Retained

Risk Retained

31.03.2014

31.03.2013

31.03.2014

31.03.2013

94%

85%

6%

15%

215

3

Contents

4

Consolidated Financials

Annual Report 2013–14

vii. Extent of risk retained and reinsured:

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | xvi. Disclosure of Fire and Marine Revenue s:

viii. Value of Contracts in relation to Investments:  (` in million) Particulars

31.03.2014

As the company operates in single insurance business class viz. Miscellaneous Insurance Business, the reporting

31.03.2013

Purchase where deliveries are pending

Nil

Nil

Sales where payments are overdue

Nil

Nil

requirements as prescribed by IRDA with respect to presentation of Fire and Marine Insurance revenue s are not applicable. There are no dues outstanding for more than 45 days during the year which are payable to Micro, Small and Development Act, 2006 is determined to the extent such parties have been identified on the basis of information

x. The Company does not have any investment property as at March 31st, 2014.

available with the Company.

xi. The investments as at year-end have not been allocated to Policy Holders & Shareholders s since the

xvii. Summary of Financial Statements is provided as under:

same are not earmarked separately.

(` in million) S. No.

xii. The historical cost of investments in mutual funds which have been valued on fair value basis is ` 546.77 million (` 215.22 million).

31.03.2014

31.03.2013

1

Gross Written

6,925.81

6,200.45

2

Net Earned Income

5,434.04

4,421.30

272.50

229.00

-

-

5,706.54

4,650.30

31.03.2013

3

Income from Investments (net)

6.25% GOI CDSS 02-01-2018

76.74

75.87

4

Other Income

6.01% GOI CDSS 25-03-2028

5.52

5.45

5

Total Income

6.17% GOI CDSS 12-06-2023

15.02

14.86

6

Commission (Net of Reinsurance)

638.72

422.91

7.95% GOI CDSS 28-08-2032

19.52

19.50

7

Brokerage

145.08

95.81

8.20% GOI CDSS 15-02-2022

2.00

2.01

8

Operating Expenses

2,082.86

1,891.72

8.33% GOI CDSS 07-06-2036

1.00

1.00

9

Claims Incurred

3,564.36

2,619.75

119.80

118.68

10

Operating Profit/Loss

(579.50)

(284.09)

11

Total Income under Shareholders

210.13

185.60

12

Profit /(Loss) before tax

(369.37)

(98.49)

13

Provision for Tax

(0.30)

149.49*

14

Profit/(Loss) after tax

(369.67)

51.00

15

Miscellaneous:

These investments are in the constituent subsidiary general ledger with Axis Bank Limited. xiv. Expenses relating to outsourcing, business development and marketing are given below: (` in million) Operating expenses

31.03.2013

527.58

480.77

Marketing

66.86

98.42

Business Promotion

302.47

220.07

Outsourcing Expenses

Policy holders’ : Total Fund Total Investments Yield on investments 16

xv. Sector Wise Business

31.03.2014 GWP (Rs. in

No. of Lives

Million)

GWP (Rs. in

No. of Lives

Not applicable being Non – Life Insurance Co.

Total Investments

31.03.2013 %of GWP

Shareholders’ : Total Fund

Disclosure of sector-wise business based on gross direct written (GWP) is as under: Business

Not applicable being Non – Life Insurance Co.

Standalone Financials

31.03.2014

Business Review

31.03.2014

Particulars

Statutory Section

(` in million)

Yield on investments %of GWP

Million)

Rural

385.60

244,923

5.57

536.04

696,423

8.65

Social

75.21

155,748

1.09

355.91

1,116,553

5.74

Urban

6463.90

2,803,387

93.34

5307.92

383,249

85.61

216

17

Paid Up Equity Capital

3,309.80

3,089.80

18

Net Worth

2,264.16

2,303.83

19

Total Assets

8,169.78

6,692.88

20

Yield on total investments

9.29%

9.13%

217

3

Contents

4

Consolidated Financials

Annual Report 2013–14

Particulars Operating Results:

xiii. Investments made pursuant to section 7 of Insurance Act, 1938, are as follows:

Sector

Corporate Review

Medium Enterprises. This information pursuant to the provisions of Micro, Small and Medium Enterprises

ix. All the investments held by the Company are performing assets.

21

Earnings Per Share (`)

22

Book value per Share (` )

23 24

0.18

6.84

7.46

Total Dividend

Nil

Nil

Dividend Per share

Nil

Nil

ing Ratios are provided as under: Performance Ratios

Gross Growth Rate (Gross for the current year divided by the gross for the previous year) Gross Direct to Net Worth Ratio (Gross for the current year divided by paid up capital plus free reserves) Growth Rate of Networth (Shareholders' funds as at the current

31.03.2014

31.03.2013

(in %/ times) 12.00

(in %/ times) 30.00

3.06

2.69

(2.00)

60.00

progress payments to contractors, advances to contractors, payments for materials, etc. The ownership of the building between Government of NCT of Delhi and the company will be decided at a future date keeping in view the lease agreement. b. On a Public Interest Litigation (PIL) regarding free treatment in the hospital the Hon’ble Delhi High Court vide its order dated 22nd September, 2009 has held that free treatment provided by the hospital as per the of lease deed with Government of National Capital Territory of Delhi shall be inclusive of medicines and consumables. In response to the said order the company filed a Special Leave Petition in the Hon’ble Supreme Court for appropriate directions with a prayer to stay the judgement of the Hon’ble Delhi high court. The Hon’ble Supreme Court of India has itted the Special Leave Petition and ed an interim order on 30.11.2009. In pursuance of the interim order, the Hospital is charging for medicines & medical consumables from patients referred by the Govt. of Delhi for free treatment in the Hospital.

37. Consolidated Segment Reporting

balance sheet date divided by shareholders' funds as at the previous balance sheet date) Net Retention Ratio (Net divided by gross including

Particulars

9.82

8.04

41.00

39.00

) Expenses of Management to Net Written Ratio (Expenses of

43.00

46.00

management plus Direct commission paid divided by the NWP) Net Incurred Claims to Net Earned

66.00

59.00

Combined Ratio (Net Incurred claims divided by NEP plus Expense of

107.00

103.00

management (including Net Commission) divided by NWP) Technical Reserves to Net Ratio (Reserve for unexpired risks

0.87

0.80

RI acceptance) Net Commission Ratio (Commission net of reinsurance for a class of business divided by net ) Expenses of Management to Gross Direct (Expenses of management plus commission paid divided by the total gross direct

plus deficiency reserve plus reserve for outstanding claims divided by net ) Underwriting Balance Ratios (Underwriting profit divided by net

(0.16)

(0.12)

(11.00)

(6.00)

0.58

0.52

the policy holders' liabilities) Net Earnings Ratio (Profit after tax divided by net )

(6.00%)

1.00%

Return on Net Worth (Profit after tax divided by net worth)

(16.00%)

(4.00%)

1.84

1.77

-

-

for the respective class of business) Operating Profit Ratio (Underwriting profit plus investment income divided by net ) Liquid Assets to Liability Ratio (Liquid assets of the insurer divided by

Available Solvency Margin to Required Solvency Margin Ratio NPA Ratio

3.

a. Under the of the agreement between the Government of NCT of Delhi and the company, the Hospital project of the company has been put up on the land belonging to Government of NCT of Delhi. The Government of NCT of Delhi is committed to meet the expenditure to the extent of ` 154.78 million out of IMCL Building fund (funds earmarked for the period) together with the interest thereon for construction of definite and designated buildings while the balance amount of the cost of the building will be borne by the Company. As at 31st March, 2013, the aforesaid fund, together with interest thereon amounting to ` 192.36 million have been utilized towards

218

Segment assets a) Hospitals b) Retail Pharmacy c) Others Total Unallocated Corporate Assets Goodwill on consolidation Deferred Tax Asset Total Assets as per Balance Sheet

25,617.14 11,016.95 1,387.01 38,021.10 32.31 37,988.79

5,054.12 306.02 264.74 5,624.85

4,987.49 168.62 241.12 5,397.23

1,193.77 364.00 4,067.08 4,067.08

1,032.50 373.95 3,990.78 3,990.78

22.31 995.74

306.83 743.54

0.43 3,049.46 (13.65) 104.34 3,167.45

2,940.41 (16.58) 87.00 3,043.50

42,468.88 3,842.00 4,845.10 51,155.98 841.20 1,499.44 228.17 53,724.79

30,814.71 3,465.00 11,476.12 45,755.83 930.36 1,453.00 252.00 48,391.19

219

3

Contents

4

Consolidated Financials

Annual Report 2013–14

Indraprastha Medical Corporation Limited

30,226.08 13,648.44 214.65 44,089.17 32.31 44,056.86

Standalone Financials

1. Segment Revenue ( Net sales / Income from each Segment ) a) Hospitals b) Retail Pharmacy b) Others Sub - Total Less : Intersegment Revenue Net sales / Income from operations 2. Segment Results ( Profit / ( Loss ) before Tax and interest from each segment ) a) Hospitals b) Retail Pharmacy b) Others Sub - Total Less : (i) Interest ( Net ) (ii)Other un-allocable expenditure net of unallocable income Profit Before Tax and Extraordinary item Less: Extra Ordinary Item Profit Before Tax Less : (i) Current tax (ii) Tax for earlier years (net) (iii) Deferred tax liability Add: Deferred Tax Asset Profit After Tax before Minority Interest Less : Mionority Interest Add : Share of Associates' Profits Net Profit Relating to the Group

(` in million) 31.03.2013

Business Review

85.00

31.03.2014

Statutory Section

94.00

Corporate Review

xviii.

(1.14)

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED | 4.

16,814.86 318.00 947.01 18,079.87 123.89 27,467.72 173.45 2,545.70 48,390.63

36,430.44 3,334.00 3,791.17 43,555.61

26,067.18 3,147.00 10,559.16 39,773.34

5,060.75 234.00 155.91 5,450.66

3,994.23 210.00 666.00 4,870.23

1,480.62 106.00 91.29 1,677.91

1,253.95 93.00 76.47 1,423.42

consolidated cash flow statement for the year ended 31st March 2014

A

38. Change in Authorised Share Capital

Western Hospital Corporation Private Limited

The Shareholders of the Company have ed a resolution at the Extraordinary General Meeting held on 17 December, 2008, for increasing the Authorized Share Capital of the Company from 50,000,000 Equity Shares of However, the Company has not filed the required forms for increasing the Authorized Share Capital with the Registrar of Companies (ROC) as at 31 March, 2014 along with the amended Memorandum of Association for

B

giving effect to the aforesaid change, for approval/confirmation from the ROC. Hence, the Authorized Share Capital of the Company as at 31 March, 2014 continues to be stated as ` 500 million. 39. Figures of the current year and previous year have been shown in million. 40. Figures in brackets relate to the figures for the previous year. 41. Previous year figures have been regrouped and reclassified wherever necessary to confirm with current years 42. Where disclosures have not been made by subsidiaries, associates or t ventures in their independent notes, the figures relate to those of the Parent Company alone.

V C Krishnan Partner (hip No. 022167) 17, Bishop Wallers Avenue West Mylapore, Chennai - 600 004

Krishnan Akhileswaran Chief Financial Officer

C For and on behalf of the Board of Directors Dr. Prathap C Reddy Executive Chairman

S M Krishnan Sr. General Manager - Finance & Company Secretary

Preetha Reddy Managing Director



Suneeta Reddy t Managing Director

4,067.12 1,670.84 (136.77) 35.95 1,193.77 7.06 (11.21) (58.50) (8.01) 2.23 204.42

(693.38) (599.39) 519.01 (1,366.69)

2,899.78 6,966.90

(2,140.45) 4,826.45 11.21 (1,103.77) 3,733.89 3,733.89 (6,118.91) 160.48 (356.67) 2,658.84 58.83 39.14

3,990.78 1,419.86 (96.09) 43.02 1,032.50 3.56 0.90 (62.95) (193.43) (57.15) 1.92 173.72

(1,120.41) (240.48) 850.19 (390.10)

2,265.86 6,256.64

(900.80) 5,355.84 (0.90) (927.42) 4,427.52 4,427.52

(3,558.28)

(6,602.11) 2.03 (3,793.25) 2,722.11 193.43 89.65 62.95 (7,325.19)

37.71 34.74 2,145.70 176.09 (1,060.03) (1,203.80) (765.19)

73.76 1,555.81 1.83 5,666.78 267.95 (2,247.20) (1,032.50) (556.50)

Place : Chennai Date : 28th May 2014

220

221

3

Contents

4

Consolidated Financials

Annual Report 2013–14

As per our Report annexed For M/s. S. Viswanathan Chartered ants Firm Registration No. 004770S

(` in million) 31.03.2013

Standalone Financials

classification.

31.03.2014

Business Review

` 10 each aggregating to ` 500 million to 100,000,000 Equity Shares of ` 10 each aggregating to ` 1000 million.

Particulars Cash Flow from operating activities Net profit before tax and extraordinary items Adjustment for: Depreciation Profit on sale of Investment Loss on sale of asset interest paid Misc.Exp.written off Foreign Exchange gain / loss Extraordinary items Interest received Dividend received Provision for wealth tax Bad debts written off Operating profit before working capital changes Adjustment for: Trade or other receivables Inventories Trade payables Others Cash generated from operations Foreign Exchange gain / loss Taxes paid Cash flow before extraordinary items Net cash from operating activities Cash flow from Investing activities Purchase of fixed assets Sale of fixed assets Purchase of investments Sale of investments Interest received Dividend received Cash flow before extraordinary item Extraordinary Item Net cash used in Investing activities Cash flow from financing activities Proceeds from issue of Share Capital Proceeds from issue of share Proceeds from advance against share capital Proceeds from long term borrowings Proceeds from short term borrowings Repayment of finance/lease liabilities Interest paid* Dividend paid

Statutory Section

18,000.38 508.00 1,576.23 20,084.61 166.46 29,766.78 187.83 3,519.11 53,724.79

Corporate Review

Segment liabilities a) Hospitals b) Retail Pharmacy c) Others Total Unallocated Corporate Liabilities Shareholders Funds Minority Interest Deferred Tax Liability Total Liabilities as per Balance Sheet 5. Segment capital employed a) Hospitals b) Retail Pharmacy c) Others Total 6. Segment capital expenditure incurred a) Hospitals b) Retail Pharmacy c) Others Total 7. Segment Depreciation a) Hospitals b) Retail Pharmacy c) Others Total

operations 2) Amount available in unclaimed dividend and

unclaimed deposit TOTAL

As per our Report annexed For M/s. S. Viswanathan Chartered ants Firm Registration No. 004770S

V C Krishnan Partner (hip No. 022167) 17, Bishop Wallers Avenue West Mylapore, Chennai - 600 004 Place : Chennai Date : 28th May 2014 Krishnan Akhileswaran Chief Financial Officer

S M Krishnan Sr. General Manager - Finance & Company Secretary

2,741.47 3,200.64

181.32 132.98

2,535.03 3,045.39

25.12 22.27

2,741.47 3,200.64

*Includes ` 69.78 million (` 35.18 million) towards cost of covering the currency fluctuations and LIBOR risk for ECB availed by the company.

For and on behalf of the Board of Directors Dr. Prathap C Reddy Executive Chairman Preetha Reddy Managing Director

Suneeta Reddy t Managing Director

Samudra Limited

Limited

Enterprises

Health care Centres Limited Health care

AB Medical

(UK) Ltd

Limited

and Lifestyle

Apollo Hospital Apollo Health

Centre Ltd

Research

Hospitals &

Imperial

Hospitals

Western

Bangalore

Cradle Limited

as Apollo Koramangala

Limited)

(Formerly

Cradle Limited

Hospitals

Limited

BioSciences Pvt

Saipen

known

Limited

(India) Limited Corporation Pvt

Medicorp

Alliance

Pinakini

(formerly

Limited

Hospital

Apollo Nellore

Limited

(Gujarat)

Limited

Centres Pvt

Surgical

Cosemtic

Care Limited

5-Sep-98

19-Jul-01 29-Nov-05

100.00

29,823,012

100.00

100.00

16,800 12,500,000

100.00

100.00

85.76

79.44

51.00

100.00

70.00

10,000

ii) Not Dealt with (` in million)

NA 3.36

NA INR (0.54)

£(0.006)

NA (326.96)

NA 51.67

NA 4.84

NA (27.13)

NA 7.92

NA (6.35)

NA

NA

NA

NA

NA

NA (31.84)

NA 7.81



Suneeta Reddy t Managing Director

S M Krishnan Preetha Reddy Sr. General Manager - Finance & Company Secretary Managing Director

5.60

Place : Chennai Date : 28th May 2014

2.30

Dr. Prathap C Reddy Executive Chairman

(167.03)

Krishnan Akhileswaran Chief Financial Officer

INR (0.58)

£(0.007)



5.88

For and on behalf of the Board of Directors

NA 4.11

NA 17.88



ii) Not Dealt With (` in million)

i) Dealt With

-

NA

Net aggregate amount of profits/(losses) of the subsidiary for previous financial years as far as it concerns of Apollo Hospitals Enterprise Limited

NA 4.44

NA 2.02

i) Dealt with

Net aggregate amount of profits/(losses) of the subsidiary for the above financial year so far as they concern of Apollo Hospitals Enterprise Limited

ii) Extent of Holding (%)

i) Equity Shares

5,000 25,303,060 25,681,000 1,109,842 6,783,000 18,000,000

(34.00)

NA

(33.69)

NA

81.37

1,805,546

8-Aug-05 12-Dec-02 18-Jan-06 18-Jun-08 31-Mar-11 15-Dec-11 10-Aug-12 8-Dec-11 Shares of subsidiary company held on the above date and extent of holding

Date from which it become subsidiary

(0.42)

NA

(0.10)

NA

99.88

49,940

11-Jun-12

0.93

NA

(0.50)

NA

69.40

2,844,262

1-Oct-13

(24.33)

NA

(18.59)

NA

51.00

670,650

31-Mar-11

Financial Year of the subsidiary ended on 31-Mar-14 31-Mar-14 31-Mar-14 31-Mar-14 31-Mar-14 31-Mar-14 31-Mar-14 31-Mar-14 31-Mar-14 31-Mar-14 31-Mar-14 31-Mar-14 31-Mar-14 31-Mar-14

Consolidated Financials

4 Standalone Financials

Contents

Business Review

223

Statutory Section

3 Corporate Review

222 Unique Home

Alliance Dental

2,368.38 Apollo

3,200.64 Apollo Clinics

3,729.93 832.26

Apollo

(634.77) (459.17)

Name of the Subsidiary Company

Net cash (used in)/from financing activities Net increase in cash and cash equivalents (A+B+C) Cash and cash equivalents (opening balance ) Cash and cash equivalents (Closing balance ) Component of Cash and cash equivqlents Cash on Hand Balance with Banks 1) Available with the company for day to day

Statement pursuant to Section 212 of the Companies Act, 1956, relating to the Subsidiary Companies

Annual Report 2013–14

(` in million)

Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

India

Western Hosptials Corporation Pvt

India

Apollo Bangalore Cradle Limited

India

16.80

INR

INR

INR

INR

INR

INR

INR

INR

INR

28.20

40.98

0.50

22.19

101.43

180.00

133.00

13.97

299.45

253.03

0.005

GBP INR

0.49

125.00

INR

INR

INR

298.23

Capital

92.15

(9.03)

(0.52)

126.30

(6.35)

(25.60)

(55.20)

(6.72)

135.03

(29.26)

(0.046)

(4.61)

111.88

26.99

36.59

Reserves

Total

Total

(0.041)

(4.11)

376.65

44.84

340.72

Liabilities

343.68

34.63

-

280.92

4.53

154.68

430.62

19.32

343.68

34.63

-

280.92

4.53

154.68

430.62

19.32

2,485.97 2,485.97

1,421.54 1,421.54

(0.041)

(4.11)

376.65

44.84

340.72

Assets

-

-

-

-

-

42.59

-

-

-

2.01

-

-

-

-

310.92

ments

Invest-

6.41

272.77

21.73

-

150.77

0.67

11.61

309.72

7.42

1,469.35

1,149.33

0.00001

0.0005

279.56

(13.76)

(0.13)

(0.10)

(38.09)

(6.30)

10.97

(22.29)

6.51

74.95

(305.04)

(0.006)

(0.54)

4.92

5.89

2.85

Taxation

25.56

Income

Profit Before

Total

Turnover/

4.83

(0.37)

-

4.40

0.05

3.05

4.84

1.67

23.28

(21.92)

-

-

1.56

1.45

0.83

Taxation

for

Provision

Statutory Section

Business Review

Standalone Financials

224 225

3 Contents

4 Consolidated Financials

are translated at the average rate of the above reported period.

Corporate Review

(18.59)

(0.50)

(0.10)

(33.69)

(6.35)

7.92

(27.13)

4.84

51.67

(326.96)

(0.006)

(0.54)

3.36

4.44

2.02

Taxation

-

-

-

-

-

-

-

-

-

-

-

-

-

Dividend

Profit After Proposed

Note : In respect of Apollo Hospitals (UK) Limited, the assets and liabilities are translated at closing rate of the reported period and Income and Expenses

1. Subsidiary of Apollo Health and Lifestyle Limited, 2. Subsidiary of Alliance Medicorp (India) Limited

Alliance Dental Care Limited 2

Pvt Limited

India

Apollo Cosmetic Surgical Centres 1

India

Apollo Clinics ( Gujarat) Limited 1

Cradle Limited) 1

(ABCL) (Formerly Apollo Koramangla

India

Saipen Bio Sciences Pvt Limited

Limited

India

Alliance Medicorp (India) Limited

(formerly Pinakini Hospitals Limited)

Apollo Nellore Hospital Limited

India

India

Imperial Hospital and Research Centre Limited

India

Apollo Health and Lifestyle Limited

Apollo Hospital (UK) Limited

UK

India

Samudra Healthcare Enterprises Limited

India

AB Medical Centres Limited

INR

Currency

India

Reporting

Country of Incorporation

Unique Home Healthcare Limited

Name of the Subsidiary Company

(` in million)

Statement pursuant to Section 212 of the Companies Act, 1956, relating to the Subsidiary Companies

Annual Report 2013–14

Notes Performance Highlights

| APOLLO HOSPITALS ENTERPRISE LIMITED |

Notes

100

the human brain has the storage capacity of trillion bits of information over the course of 70 years equal to 500,000 sets of the Encyclopedia Britannica, which when stacked would reach 442 miles high.

30 FEET

For the kind attention of Shareholders

MPH

2

20%

the eye focusing muscles m o v e around

each kidney contains

ONE

MILLION

of blood through of blood a day.

Yo ur br ain uses of the oxygen that enters your bloodstream

INDIVIDUAL

FILTERS

100,000

capillaries

t he human he art can c r e a t e e n o u g h pressure to squirt blood

of the brain is made up of H2O (water)

300,000 MILLION

80%

170

2,100 gallons are pumped 62,000 miles vessels in

the lungs contain o v e r

nerve impulses to and from the brain can travel as fast as

times per day

90% of all information is received by the eyes

$6,000,000,000,000,000

a. Shareholders / Proxy holders attending the meeting should bring the attendance

Priceless

slip to the meeting and hand over the same at the entrance duly signed. b. Shareholders / Proxy holders attending the meeting are requested to bring the copy of the Annual Report for the reference at the meeting.

#

3

Contents

4

As reported in The New York Times, 11th February, 1976, “The High Cost of Being Human”—Harold J Morowitz

#

Committed to preserving that which is Priceless. Apollo Hospitals.

Apollo Hospitals Enterprise Limited [CIN : L85110TN1979PLC008035] Regd. Office: No.19, Bishop Garden, Raja Annamalai Puram, Chennai – 600 028 Secretarial Dept: Ali Towers III Floor, No.55, Greams Road, Chennai – 600 006 E-mail: [email protected] : Website: www.apollohospitals.com Phone: +91 044 28290956, 044 28293896 Board: 28293333 Ext. 6681

3

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