Your Directors are pleased to present the 36th Annual Report of Divi's Laboratories Limited (the Company or Divi's), together with the audited standalone and consolidated financial statements for the financial year ended March 31,2026.
The consolidated performance of the Company and its subsidiaries (the Group) has been referred to wherever considered necessary.
Financial highlights and company affairs
The Company continued to demonstrate resilience and steady performance during the year under review. The Company's financial performance (standalone and consolidated) for the year ended March 31,2026, is summarized below:
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(' in crores)
|
|
Particulars
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Standalone
|
Consolidated
|
|
2025-26
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2024-25
|
2025-26
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2024-25
|
|
Revenue from operations
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10,388
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9,198
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10,560
|
9,360
|
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Other income
|
506
|
352
|
507
|
352
|
|
Total income
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10,894
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9,550
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11,067
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9,712
|
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Expenditure before depreciation and finance costs
|
6,974
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6,219
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7,193
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6,392
|
|
Profit before depreciation, finance costs and tax (PBDIT)
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3,920
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3,331
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3,874
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3,320
|
|
Depreciation
|
461
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401
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463
|
402
|
|
Finance costs
|
23
|
1
|
23
|
2
|
|
Profit before tax (PBT)
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3,436
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2,929
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3,388
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2,916
|
|
Tax expense:
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|
Current tax
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869
|
793
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868
|
799
|
|
Deferred tax
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(40)
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(73)
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(48)
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(74)
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Total tax expense
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829
|
720
|
820
|
725
|
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Profit after tax (PAT)
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2,607
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2,209
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2,568
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2,191
|
|
Other comprehensive income (Net of tax)
|
6
|
(2)
|
21
|
3
|
|
Total comprehensive income
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2,613
|
2,207
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2,589
|
2,194
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Earnings per share of '2/- each (EPS) Basic & Diluted (in ')
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98.19
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83.20
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96.75
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82.53
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Operations for the year:
The financial year 2025-26 was marked by a challenging global environment, with evolving geopolitical and trade dynamics. Despite this, the Company demonstrated resilience through agile decision-making, operational stability and a diversified sourcing strategy.
During the year, the Company delivered steady performance across its businesses. The Company continued to invest in capacity expansion and backward integration, enhancing its ability to support future growth. With a continued focus on quality, compliance, operational excellence and sustainability, the Company remains well-positioned to leverage long-term industry opportunities while maintaining prudent financial and risk management.
Standalone financial performance
The Company recorded revenue from operations of '10,388 crores during the financial year, reflecting a growth of 13% over the previous year. Total income stood at '10,894 crores, while profit before tax and profit after tax is '3,436 crores and '2,607 crores, respectively. The tax expense for the year was '829 crores.
Consolidated financial performance
The Group recorded total income of '11,067 crores during the financial year, with profit before tax and profit after tax at '3,388 crores and '2,568 crores, respectively. The consolidated performance largely reflects the standalone operations of the Company.
The consolidated financial statements have been prepared in accordance with the provisions of the Companies Act, 2013 (Act) and the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015 (SEBI Listing Regulations), in compliance with applicable Indian Accounting Standards (Ind AS), and together with the Auditor's Report thereon, forms part of this Annual Report.
Dividend
The Board of Directors has recommended a dividend of '30/- per equity share of face value '2/- each (1,500%) for the financial year ended March 31,2026, in accordance with the Company's Dividend Distribution Policy. The total dividend payout for the year amounts to '796 crores, representing 31% of the standalone profit after tax.
The dividend is subject to approval of the Members at the ensuing Annual General Meeting (AGM) and will be subject to deduction of tax at source. The record date for determining the eligibility of Members entitled to receive the dividend, if declared at the AGM, is July 24, 2026.
Pursuant to Regulation 43A of the SEBI Listing Regulations, the Dividend Distribution Policy is available on the Company's website at: https://www.divislabs.com/investor-relations/ policies-documents/.
Transfer to reserves
The Company has not proposed to transfer any amount to the General Reserve on declaration of dividend.
Capital expenditure
The Company continues to make steady progress on its capital expenditure programmes. The Kakinada (Unit 3) project, operational since January 2025, is being scaled up in phases and supports backward integration through production of select starting materials and intermediates, while enabling release of GMP capacity at existing units.
In addition, capital expenditure programmes at Unit 1 and Unit 2 are progressing across various stages of implementation and regulatory approvals. These projects, backed by long-term business commitments, are focused on capacity expansion and enhancement of capabilities in complex chemistries.
The property, plant and equipment and intangible assets aggregating to '1,544 crores were capitalized during the financial year. Capital work-in-progress across all locations as of March 31,2026, amounts to '2,113 crores.
Material changes and commitments affecting the financial position between the end of the financial year and the date of the report
There have been no material changes or commitments affecting the financial position of the Company that have occurred between the end of the financial year to which the financial statements relate and the date of this Report.
Changes in the nature of business
During the year under review, there was no change in the nature of business of the Company. Further, there was no significant change in the nature of business carried on by its subsidiaries.
Business Responsibility and Sustainability Report
The Business Responsibility and Sustainability Report (BRSR) for the financial year 2025-26, as required under Regulation 34(2) of the SEBI Listing Regulations, is presented in a separate section and forms part of this Annual Report.
Management Discussion and Analysis
The Management Discussion and Analysis Report for the year under review, as required under Regulation 34(2) of the SEBI Listing Regulations, is presented in a separate section and forms part of this Annual Report.
Corporate Governance Report
The Corporate Governance Report, as required under Regulation 34(3) read with Schedule V of the SEBI Listing Regulations, forms part of this Annual Report. A certificate from the Practicing Company Secretary confirming compliance with the conditions of Corporate Governance is annexed to the said Report.
Credit ratings
During the financial year, CARE Ratings Limited reaffirmed the Company's strong credit ratings for its bank facilities, reflecting its consistent financial performance and stable credit profile.
Subsidiaries
The Company has two wholly owned subsidiaries, Divis Laboratories (USA) Inc. and Divi's Laboratories Europe AG, engaged in marketing and distribution of nutraceutical ingredients used in the food, beverage, dietary supplement, feed and pet food industries, etc., providing enhanced access to customers in their respective regions.
There was no material change in the nature of business of the subsidiaries during the year.
The Company does not have any material subsidiaries, associates or joint ventures. The Policy on determination of material subsidiaries is available on the Company's website at https://www.divislabs.com/investor-relations/policies-documents/.
The Board reviewed the affairs of the subsidiaries during the year. A statement containing salient features of their financial statements and performance in Form AOC-1 is annexed as Annexure - I to this Report.
The Audited Standalone Financial Statements of the Company, Audited Consolidated Financial Statements of the Group and the Audited Financial Statements of the subsidiaries, are available on the Company's website at https://www.divislabs. com/investor-relations/.
Directors and Key Managerial Personnel Appointments / Re-appointments during the year:
Re-appointment on retirement by rotation:
• Mr. N.V. Ramana and Dr. Kiran S. Divi retire by rotation at the forthcoming 36th AGM and, being eligible, offer themselves for re-appointment.
Key Managerial Personnel
The details of Key Managerial Personnel as on March 31, 2026, are as under:
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Name
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Designation
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Dr. Murali K. Divi
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Managing Director
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Mr. N. V. Ramana
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Executive Director
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Dr. Kiran S. Divi
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Whole-time Director and Chief Executive Officer
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Ms. Nilima Prasad Divi
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Whole-time Director (Commercial)
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Dr. S. Devendra Rao
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Whole-time Director (Manufacturing)
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|
Mr. Venkatesa Perumallu Pasumarthy
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Chief Financial Officer
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Mr. M. Satish Choudhury
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Company Secretary and Compliance Officer
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During the year, Mr. L. Kishore Babu superannuated as Chief Financial Officer and Key Managerial Personnel of the Company with effect from August 01, 2025. Consequently, Mr. Venkatesa Perumallu Pasumarthy was appointed as Chief Financial Officer and Key Managerial Personnel of the Company with effect from the same date.
Declaration by Independent Directors
The Company has received declarations from all the Independent Directors under Section 149(7) of the Companies Act, 2013 and Regulation 25 of the SEBI Listing
Regulations, confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Act and Regulation 16(1)(b) of the SEBI Listing Regulations. They have also affirmed compliance with the Code of Conduct for Independent Directors as set out in Schedule IV of the Act. In the opinion of the Board, the Independent Directors possess the requisite integrity, expertise and experience.
Policy on Directors' appointment and remuneration
As on March 31, 2026, the Board comprised ten Directors, including five Executive Directors and five Non-Executive Independent Directors, with two women Directors.
The appointment of Independent Directors is in accordance with the criteria prescribed under the Act and the SEBI Listing Regulations.
The Company has in place a Nomination and Remuneration Policy, formulated pursuant to applicable provisions and based on the recommendation of the Nomination and Remuneration Committee, which, inter alia, provides for identification of qualified individuals, Board diversity, criteria for appointment and independence, remuneration framework, and performance evaluation of Directors, Key Managerial Personnel and Senior Management. The Policy is available on the Company's website at https://www. divislahs.com/wp-content/uploads/7075/07/Nomination-Remuneration-policy.pdf.
We affirm that the remuneration paid to the Directors is as per the terms laid out in the Nomination and Remuneration Policy of the Company.
Remuneration details of Directors & KMP and particulars of employees
Pursuant to Section 197(12) of the Act, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (Rules), the prescribed particulars pertaining to remuneration and other details are given in Annexure - II to this Report.
The non-executive independent directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, annual remuneration and reimbursement of expenses for attending meetings, if any.
In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Rules, a statement showing the names and other particulars of employees drawing remuneration in excess of the limits set out in the said Rules forms part of this report. Further, the report and the annual accounts are being sent to the Members excluding
The Company follows an enterprise-wide risk management approach, with continuous identification, evaluation and mitigation of key operational and strategic risks, including business, regulatory, operational, ESG and cybersecurity risks. Further details are provided in the Management Discussion and Analysis Report forming part of this Annual Report.
Directors' responsibility statement
Pursuant to Section 134 (5) of the Act, the Board of Directors, to the best of its knowledge and ability, confirms that:
a) the applicable accounting standards read with requirements of Schedule III to the Act have been followed in the preparation of the annual accounts for the year ended March 31, 2026 and there are no material departures from the same;
b) accounting policies selected were applied consistently and the judgements and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at the end of the financial year and of the profit of the Company for the period;
c) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) the annual accounts have been prepared on a going concern basis.
e) internal financial controls have been laid down and such controls are adequate and operating effectively;
f) proper systems have been laid down to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively.
Corporate social responsibility (CSR)
The Company's CSR initiatives are focused on creating sustainable and inclusive impact across communities surrounding its operations. Key areas of intervention include education, healthcare, safe drinking water, rural infrastructure, sanitation, environmental sustainability, livelihoods and community development, etc.
During the year, the Company undertook various initiatives such as strengthening educational infrastructure and student support, expanding access to safe drinking water, improving healthcare access through camps and infrastructure support, and contributing to village development through infrastructure and irrigation projects among others. The Company also supported livelihood generation, women empowerment, sports development, environmental initiatives and animal welfare, along with targeted interventions in child development and disaster relief.
the aforesaid statement. In terms of Section 136 of the Act, the said statement will be open for inspection upon request by the Members. Any Member interested in obtaining the statement may write to the Company Secretary at cs@divislabs.com.
Number of meetings of the Board
The Board met four times during the financial year. The meeting details are provided in the Corporate Governance Report that forms part of this Report. The intervening gap between the meetings was within the period prescribed under the Act and the SEBI Listing Regulations.
Performance evaluation
The Board carried out an annual evaluation of its own performance, that of its Committees and individual Directors, including Independent Directors, in accordance with the provisions of the Act and the SEBI Listing Regulations. The evaluation was based on structured criteria and guidance issued by SEBI, and was conducted through a formal process involving structured questionnaires and feedback from the Directors.
A separate meeting of the Independent Directors was held, wherein the performance of the Chairman, non-independent Directors and the Board as a whole was evaluated, taking into account the views of non-independent Directors. The performance of Independent Directors was evaluated by the entire Board, excluding the Directors being evaluated. The outcomes of the evaluation process were discussed by the Board and used to enhance overall effectiveness.
Details of the meeting of Independent Directors are provided in the Corporate Governance Report forming part of this Annual Report.
Committees of the Board
As on March 31, 2026, the Board has five Committees, namely the Audit Committee, Nomination and Remuneration Committee, Stakeholders' Relationship Committee, Corporate Social Responsibility Committee, and Risk Management and Sustainability Committee.
All the recommendations made by the Committees during the year were duly approved by the Board. Details of the composition of the Board and its Committees are provided in the Corporate Governance Report forming part of this Annual Report.
Public deposit
As the Company has not accepted any deposits from the public covered by provisions of Section 73 of the Act, there was no amount outstanding on account of principal or interest on deposits from public as on the date of the balance sheet.
Loans, guarantees or investments
The Company has not granted any loans or provided any guarantees covered under the provisions of Section 186 of the Act. Details of investments made by the Company are disclosed in the notes to the financial statements forming part of this Annual Report.
Related party transactions
The Company has in place a Policy on Related Party Transactions, in line with the provisions of the Act and the SEBI Listing Regulations, which is available on its website at https://www.divislabs.com/wp-content/uploads/7075/07/ Policy-on-Related-Party-Transactions.pdf.
The Policy intends to ensure that proper reporting, approval and disclosure processes are in place for all transactions between the Company and related parties. All related party transactions and subsequent modifications are placed before the Audit Committee for review and approval.
Prior omnibus approval is obtained for related party transactions on a quarterly basis for transactions which are of repetitive nature and/ or entered in the ordinary course of business and are at arm's length. All contracts and arrangements with related parties were at arm's length and in the ordinary course of business of the Company. There are no materially significant related party transactions entered into by the Company with related parties which may have potential conflict of interest with the Company at large. Statement of transactions with related parties during the year is given at Note No. 31 of the Notes to standalone financial statements.
In accordance with Section 134(3)(h) of the Act, and Rule 8(2) of the Companies (Accounts) Rules, 2014, the particulars of the contracts or arrangements with related parties referred to in Section 188(1) of the Act, are provided in Form AOC-2 attached as Annexure - III to this Report.
Internal financial controls
The Company has in place adequate internal financial controls with reference to its financial statements. These controls ensure the accuracy and completeness of the accounting records and the preparation of reliable financial statements. Details in respect of internal financial controls and their adequacy are included in the Management Discussion and Analysis Report, which forms part of this Annual report.
Risk management
The Company has in place a Risk Management and Sustainability Committee responsible for overseeing the implementation and effectiveness of the risk management framework, with additional oversight on financial risks and controls by the Audit Committee. Details of the Committee's composition and terms of reference are provided in the Corporate Governance Report forming part of this Annual Report.
These initiatives have positively impacted a large number of beneficiaries and continue to contribute towards improving quality of life and fostering long-term community resilience.
The Company's CSR Policy is available on its website at: https://www.divislabs.com/wp-content/uploads/7075/07/ Divis-CSR-Policy.pdf.
The Annual Report on Corporate Social Responsibility (CSR) activities for the financial year 2025-26 is annexed as Annexure - IV to this Report.
Conservation of energy, technology absorption and foreign exchange earnings & outgo
The Company continues to focus on energy efficiency, adoption of advanced technologies and optimal utilization of resources in its operations.
Particulars as required under Section 134(3)(m) of the Act, read with Rule 8(3) of the Companies (Accounts) Rules, 2014, are annexed as Annexure - V to this Report.
Vigil mechanism
The Company has established a vigil mechanism and adopted a Whistle Blower Policy in accordance with the provisions of the Act and the SEBI Listing Regulations, to enable Directors, employees and other stakeholders to report genuine concerns regarding unethical behaviour, actual or suspected fraud or violation of the Company's Code of Conduct.
The mechanism provides for adequate safeguards against victimisation and ensures direct access to the Chairman of the Audit Committee in appropriate cases. The Company ensures that all concerns are investigated in a fair and impartial manner and appropriate action is taken. The Whistle Blower Policy is available on the Company's website at: https://www.divislabs.com/wp-content/uploads/7075/07/ WhistleBlowerPolicy.pdf
Statutory auditors
M/s. Price Waterhouse Chartered Accountants LLP (Firm Registration No. 012754N/N500016), Chartered Accountants, were re-appointed as Statutory Auditors at the 32nd Annual General Meeting held on August 22, 2022, for a term of five consecutive years until the conclusion of the 37th AGM to be held in the year 2027.
Secretarial auditors
Pursuant to the approval of the Members at the 35th AGM held on August 11, 2025, M/s. V. Bhaskara Rao & Co., Practicing Company Secretaries, Hyderabad, (Unique code number of firm: P2025TS104600 and having Peer Review No.6351/2025) were appointed as Secretarial Auditors of the Company for a term of five consecutive years until the conclusion of the 40th
AGM to be held in the year 2030. The Secretarial Audit Report is annexed as Annexure - VI to this Report.
Auditors' qualifications, reservations, adverse remarks or disclaimers
There are no qualifications, reservations, adverse remarks or disclaimers by the Statutory Auditors in their report, or by the Secretarial Auditor in the Secretarial Audit Report for the financial year 2025-26. During the year, there were no instances of frauds reported by Auditors under Section 143(12) of the Act.
Cost audit
Pursuant to the provisions of Section 148 of the Act read with Rule 3 of the Companies (Cost Records and Audit) Rules, 2014, as amended, the Company is required to maintain cost records and accordingly, such records are maintained.
As per Rule 4 of the said Rules, cost audit is not applicable to a company covered under Rule 3, if its revenue from exports in foreign exchange exceeds 75% of its total revenue or if it operates from a Special Economic Zone. The Company meets the prescribed criteria and is therefore exempt from mandatory cost audit.
Annual return
The Annual Return of the Company as on March 31, 2026, prepared in accordance with the provisions of Section 92(3) read with Section 134(3)(a) of the Act, is available on the Company's website at: https://www.divislabs.com/investor-relations/reports-and-filings/annual-return/.
Other disclosures
• Information relating to unclaimed dividend and transfer of eligible dividend and shares to the Investor Education and Protection Fund (IEPF) is provided in the Corporate Governance Report forming part of this Annual Report.
• No company has become or ceased to be a subsidiary, joint venture or associate of the Company during the year.
• No significant or material orders were passed by any regulatory authority, court or tribunal impacting the going concern status or future operations of the Company.
• The Company has complied with the provisions relating to the constitution of the Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, and no complaints were received or pending during the year.
• The Company has complied with the applicable Secretarial Standards, namely SS-1 and SS-2, relating to Meetings of the Board of Directors and General Meetings, respectively.
• No application was made or proceeding was pending against the Company under the Insolvency and Bankruptcy Code, 2016 during the year.
• There was no instance of one-time settlement with any Bank or Financial Institution.
• During the year under review, the Company is in compliance with the provisions of the Maternity Benefit Act, 1961, as amended. Adequate measures are in place to provide maternity benefits, including leave and other applicable facilities, to eligible employees.
• During the year under review, none of the directors of the Company have received any remuneration from the Company's subsidiaries.
Acknowledgements
Your Directors place on record their sincere appreciation for the continued support and cooperation received from customers, shareholders, suppliers, bankers, business associates, financial institutions, regulatory authorities and the Central and State Governments.
The Directors also express their deep appreciation for the dedication, commitment and contribution of the employees at all levels of the Company and its subsidiaries, whose continued efforts have significantly contributed to the growth and success of the Company.
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