The recoverable amount of the above CGU has been assessed using a value-in-use model. Value in use is calculated as the net present value of the projected pre-tax cash flows plus a terminal value of the cash generating unit to which the goodwill is allocated. Initially a pre-tax discount rate is applied to calculate the net present value of the pre-tax cash flows.
The cash flow projections include specific estimates for five years developed using internal forecasts and a terminal growth rate thereafter of 2% (31 March 2025: 2%). The planning horizon reflects the assumptions for short-to-mid term market developments.
Discount rate reflects the current market assessment of the risks. The discount rate is estimated based on the weighted average cost of capital for the Company. Pre-tax discount rate used for the year ended 31 March 2026 was 16.20% (31 March 2025: 16.20%).
The values assigned to the key assumptions represent management's assessment of future trends in the pharmaceuticals industry and have been based on historical data from both external and internal sources.
The Company has conducted analysis of the sensitivity of the impairment test to changes in the key assumptions used to determine the recoverable amount of CGU to which goodwill is allocated. The management believes that any reasonably possible change in the key assumptions on which the recoverable amount is based would not cause the aggregate carrying amount to exceed the aggregate recoverable amount of the related CGU.
(v) The rights, preferences and restrictions attaching to equity shares including restrictions on the distribution of dividends and the repayment of capital.
The Company has only one class of equity shares having a par value of ?10/- per share. Every member holding equity shares therein shall have voting rights in proportion to the member's share of the paid up equity share capital. The Company declares and pays dividend in Indian rupees. The dividend proposed by the Board of Directors, if any, is subject to the approval of the shareholders in the ensuing Annual
General Meeting except interim dividend, if any. In the event of liquidation of the Company, the holders of equity shares would be entitled to receive remaining assets of the Company, after distribution of all the preferential amounts. The distribution will be in proportion to the number of equity shares held by the equity shareholders.
(vi) During the five reporting periods immediately preceding the reporting date no shares have been issued for consideration other than cash.
(vii) During the five reporting periods immediately preceding the reporting date, no shares have been issued by capitalization of reserves as bonus shares.
(viii) During the five reporting periods immediately preceding the reporting date, no shares have been bought back.
Nature and purpose of reserves
(i) Securities premium
Securities premium account is used to record the premium on issue of shares. This reserve can be utilized in accordance with the said provisions of The Companies Act, 2013. This account also includes the share premium on shares issued to the shareholders of erstwhile Wyeth limited, pursuant to the Scheme of Amalgamation.
(ii) General reserve
General reserve forms part of the retained earnings and is permitted to be distributed to shareholders as part of dividend.
(iii) Capital reserve
The share-based payment reserve is used to recognize the value of equity settled share-based payments provided to the employees by Pfizer Inc. the ultimate holding company and the Company is not liable for any recharge of the amount. Refer note 33 for further details on the plan.
b) Nature of provisions:
(iv) Retained earnings
The amount that can be distributed by the Company as dividends to its equity shareholders. Refer Statement of changes in equity.
(v) Remeasurements of the net defined benefit plans
The amount represents remeasurement of defined benefit plans.
Provisions are reviewed at each balance sheet date and adjusted to reflect the current best estimate. If it is no longer probable that the outflow of resources would be required to settle the obligation, the provision is reversed.
Anticipated Sales returns:
This represents provision towards saleable and non-saleable return expected to be made by the customers till the product expiry. Provision towards saleable return represents products which are expected to be returned in saleable condition while non-saleable return represents expected returns of products which are either expired or damaged, such that the sale of such products may not be possible. Management estimate the provision based on historical returns and any recent trends that may suggest future returns could differ from historical amounts.
Provision for demands under DPCO:
This represents provision recognized by the Company towards unsettled compensations claimed under DPCO from the Company. The provisions for demand under DPCO comprises numerous separate cases that arise in the ordinary course of business. A provision is recognised for legal cases if the company assesses that it is probable that an outflow of economic resources will be required. These provisions have not been discounted as it is not practicable for the Company to estimate the timing of the provision utilization and cash outflows, if any, pending resolution.
The amount represents purchase consideration payable to related party John Wyeth and Brother Limited, UK for the transfer of its undertaking in India to erstwhile Wyeth Limited. The amount has been retained as an interest free unsecured loan as per the directives of the Reserve Bank of India in this regard pending appropriate clearance from the income tax authorities.
The Company offsets tax assets and liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax authority.
Management judgement is required in determining provision for income tax, deferred income tax assets and liabilities and recoverability of deferred income tax assets. The recoverability of deferred income tax assets is based on estimates of taxable income and the period over which deferred income tax assets will be recovered. Any changes in future taxable income would impact the recoverability of deferred tax assets.
The plans expose these companies to a number of actuarial risks such as investment risk, interest rate risk,longevity risk and inflation risk. The companies have developed policy guidelines for the allocation of assets to different classes with the objective of controlling risk and maintaining the right balance between risk and long-term returns in order to limit the cost to these companies of the benefits provided. To achieve this, investments are well diversified, such that the failure of any single investment would not have a material impact on the overall level of assets.
(i) Movement in net defined benefit asset/ liability
The following table shows a reconciliation from the opening balances to the closing balances for net defined benefit (asset) liability and its components.
32 Employee benefits
(A) Defined contribution plan:
During the year, the Company has contributed ?0.23 crore (31 March 2025: ?0.22 crore) towards employees' superannuation fund and ?16.97 crore towards Provident Fund (31 March 2025: ?17.69 crore).
(B) Long-term employee benefit - Compensated absences
All eligible employees can carry forward and avail / encash leave as per Company's rules.
(C) Defined benefit plan:
Gratuity plan
In accordance with the provisions of the Payment of Gratuity Act, 1972, the Company has a defined benefit plan which provides for gratuity payments. The plan provides a lump sum gratuity payment to eligible employees at retirement or termination of their employment. The amounts are based on the respective employee's last drawn salary and the years of employment with the Company.
Liabilities in respect of the gratuity plan are determined by an actuarial valuation, based upon which the Company makes annual contributions to the Group Gratuity cum Life Assurance Schemes administered by the LIC of India, a funded defined benefit plan for qualifying employees. Trustees administer the contributions made by the Company to the gratuity scheme.
33 Share-based payment arrangements
a) Employee stock options - equity settled
Certain employees of the Company are eligible for stock options, restricted stock units, portfolio performance shares and total shareholder return units granted by Pfizer Inc.(Ultimate holding company). The Company has accounted ?14.06 crore (31 March 2025: ?13.66 crore) for share-based payment transactions among group entities in accordance with Ind AS 102, 'Share-based Payments'.
Nature and extent of employee share-based payment plans
Pfizer Inc., as a part of the long-term incentive awards offers certain common stock (shares) to the employees of Pfizer Inc., and its subsidiaries. These shares are offered through grant of awards which is a combination of restricted stock units, portfolio performance shares and total shareholder return units under the Pfizer Inc. 2019 Stock plan. As per the plan, the vesting period of the stock options and the restricted stock units is 3 years from the grant date and the stock options have a term of 10 years from the grant date. All stock options and restricted stock units are settled through equity. All these share based plans are settled by holding company and hence the Company doesnt have any obligation to settle.
The employees of the Company have been issued 45,552 (31 March 2025: 45,953) restricted stock units, 6,941 (31 March 2025: 5,716) portfolio performance shares and 84,943 (31 March 2025: 71,734) total shareholder return units under the Pfizer Inc., 2019 Share Option Plan by Pfizer Inc.
(i) Employee stock options (ESOP)
Employee stock option provides the employees of Pfizer Limited with a right to receive a unit of the stock of Pfizer Inc., at a predetermined exercise price upon fulfillment of vesting conditions.
The weighted average grant date fair value of PPSs option granted during the years ended 31 March 2026 is US $ 26.58 per PPS (31 March 2025: US $25.75 per PPS).
(iv) Total Shareholder Return Units (TSRUs)
TSRUs are awarded to senior and other key management, and, beginning in 2016, to certain other employees. TSRUs entitle the holders to receive a number of shares of Pfizer Inc. with a value equal to the difference between the defined settlement price and the grant price, plus the dividends accumulated during the five-year or seven-year term, if and to the extent the total value is positive.
Value of TSRU grants is measured as of the grant date using a Monte Carlo simulation model. The values determined through this fair value methodology generally are amortized on a straight-line basis over the vesting term.
The weighted average remaining contractual life of the TSRUs outstanding at the year end is 3.49 years.
The weighted average grant date fair value of TSRUs granted during the year ended 31 March 2026 is US $ 26.58 per TSRU (31 March 2025: US $25.75 per TSRU)
b) Valuation of Restricted stock units
The fair value of Restricted stock units granted during the period has been measured using the closing price of common stock as of the grant date.
c) Valuation of Portfolio performance shares
The fair value of Portfolio performance units granted during the period has been measured using the intrinsic value method using the closing price of common stock as of the grant date.
d) Valuation of Total Shareholder Return Units
The fair value of Total Shareholder Return Units granted during the period has been measured using a Monte Carlo simulation method as of the grant date.The weighted average assumptions used in valuation of TSRU's were as follows:
34 Leases
(a) Company as a Lessee
The Company's lease asset classes primarily consist of leases for land and buildings. The lease period for these contracts varies from 1 year to 6 years except for Goa plant having a lease period of 99 years and in certain cases, mainly relating to rent of (parts of) buildings, with extension options. The Right-of-use assets and Lease liabilities as disclosed below, do not include short term and low value leases.
Right-of-Use Assets
The movement in Right-of-use assets has been disclosed in Note 4.
Lease Liabilities
Movement in Lease Liabilities as from 1 April 2025
The company does not face a significant liquidity risk with regard to its lease liablities as the current assets are sufficient to meet the obligations related to lease liablities as and when they fall due.
(b) Company as a Lessor
Lease rental receipts recognised in the statement of profit and loss account is Nil for the year ended 31 March 2026 (31 March 2025 : ?12.66 crore).
35 Financial instruments
1. Financial instruments - Fair values and measurements
A. Accounting classification and fair values
The following table shows the carrying amounts and fair values of financial assets and financial liabilities as at 31 March 2026, including their levels are presented below. It does not include the fair value information for financial assets and financial liabilities not measured at fair value if their carrying amount is a reasonable approximation of fair value.
B. Measurement of fair values
The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair value that are either observable or unobservable and consists of following:
Level 1 - category includes financial assets and liabilities, that are measured in whole or in significant part by reference to published quotes in an active market.
Level 2 - category includes financial assets and liabilities measured using a valuation technique based on assumptions that are supported by prices from observable current market transactions. These include assets and liabilities for which pricing is obtained via pricing services, but where prices have not been determined in an active market, financial assets with fair values based on broker quotes and assets that are valued using the Company's own valuation models whereby the material assumptions are market observable.
Level 3 - category includes financial assets and liabilities measured using valuation techniques based on non-market observable inputs. This means that fair values are determined in whole or in part using a valuation model based on assumptions that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data. However, the fair value measurement objective remains the same, that is, to estimate an exit price from the perspective of the Company.
2. Financial risk management - objective and policies
(i) Financial risk management framework
The Company has exposure to the following risks arising from financial instruments:
- Credit risk
- Liquidity risk
- Market risk
- Currency risk
The Company's Board of Directors have overall responsibility for the establishment and oversight of the Company's risk management framework.
The Company's risk management is carried out by the management in consultation with the Board of Directors. The Board provides principles for overall risk management, as well as policies covering specific risk areas.
The Audit Committee oversees how management monitors compliance with the Company's risk management policies and procedures, and reviews the adequacy of the above financial risk management framework in relation to the risks faced by the Company. The Audit Committee is assisted in its oversight role by internal audit. Internal audit undertakes both regular and adhoc reviews of risk management controls and procedures, the results of which are reported to the Audit Committee.
(ii) Credit risk
Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company's receivables from customers and from its financing activities including deposits with banks and other financial instruments. The Company establishes an allowance for expected credit loss and impairment that represents its estimate of incurred losses in respect of trade and other receivables and investments.
a) Trade receivables
The maximum exposure to the credit risk at the reporting date is primarily from trade receivables amounting to ?181.80 crore as at 31 March 2026 (31 March 2025: ?193.09 crore).
Trade receivables are typically unsecured and are derived from revenue earned from customers primarily located in India. The majority of the Company's trade receivables are due for maturity within 7 - 40 days from the date of billing to the customer.
The Company's exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the customer, including the default risk of the industry, the country and the state in which the customer operates, also has an influence on credit risk assessment. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business.
b) Expected credit loss assessment for customers and loans
The Company allocates each exposure to a credit risk grade based on a variety of data that is determined to be predictive of the risk of loss (e.g. timeliness of payments, available press information etc.) and applying experienced credit judgement.
Exposures to customers and loans outstanding at the end of each reporting period are reviewed by the Company to determine incurred and expected credit losses. The company provided for expected credit loss based on lifetime expected credit loss. (simplified approach).
The following table provides information about the exposure to credit risk and ECL's for trade receivables from individual customers:
c) Cash and bank balances
The Company held cash and bank balances of ?3,110.76 crore as at 31 March 2026 (31 March 2025: ?2,800.98 crore). Credit risk on cash and bank balances is limited as these are generally held or invested in deposits with banks with good credit ratings.
d) Investments
There are no significant investments made by the Company and hence credit risk is not significant.
(iii) Liquidity risk
Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company's principal sources of liquidity are cash and bank balances and the cash flow that is generated from operations. The Company has no outstanding bank borrowings. The Company believes that the working capital is sufficient to meet its current requirements.
Exposure to liquidity risk
Contractual maturities of significant financial liabilities alongwith its carrying value as at the balance sheet date.
(iv) Market risk
Market risk is the risk that changes in market prices - such as foreign exchange rates, interest rates and equity prices - will affect the Company's income or the value of its holdings of financial instruments. Market risk is attributable to all market risk sensitive financial instruments including foreign currency receivables and payables. We are exposed to market risk primarily related to foreign exchange rate risk. Thus, our exposure to market risk is a function of revenue generating and operating activities in foreign currency. The objective of market risk management is to avoid excessive exposure in our foreign currency revenues and costs.
(v) Currency risk
The Company is exposed to currency risk on account of its operations. The functional currency of the Company is Indian Rupee. The exchange rate between the Indian rupee and foreign currencies has changed substantially in recent years and may continue to fluctuate substantially in the future.
36 Capital management
a) Risk management
The Company's policy is to maintain a strong capital base to sustain future development of the business.
The Company has adequate cash and bank balances and continues to remain debt-free. The Company monitors its capital by a careful scrutiny of the cash and bank balances, and a regular assessment of any debt requirements. In the absence of any debt, the maintenance of debt equity ratio etc. may not be of any relevance to the Company.
b) Dividend
Final dividend of '35 per equity share of '10 each (31 March 2024: '35 per equity share of '10 each) and a special dividend of '100 per equity share of ?10 each, in view of 75th year of Pfizer in India and a special dividend of '30 per equity share of ?10/- each in view of the gain on transfer of assignment of leasehold land and building constructed on such land thereon, totaling to a dividend of '165 per equity share of '10 each for the financial year ended March 31, 2025. These dividends were approved in the annual general meeting on 21July 2025 and paid on 25 July 2025.
The Company has complied with the provisions of Section 123 of the Companies Act, 2013.
38 Contingent liabilities and commitments (to the extent not provided for)
The Company has reviewed all its pending litigations and proceedings periodically. Pending resolution of the respective proceedings, it is not practicable for the Company to estimate reliabily the timings and impact of cash outflows, if any, in respect of contingent liabilities reported below as it is determinable only on receipt of judgements/decisions pending with various forums/authorities. Wherever applicable, the amount includes interest upto the date of respective orders received by the Company.
a) Pricing litigations - Contingencies
The government had raised certain pricing related demands on Pfizer Limited and the erstwhile Parke-Davis (India) Ltd., Pharmacia Healthcare Limited and Wyeth Limited (which entities merged with Pfizer Limited), in respect of certain price fixation orders and other allied matters under various Drug (Prices Control) Orders (DPCO), viz., DPCO 1979, DPCO 1987, DPCO 1995 and DPCO 2013. These demands include alleged differential price demand on procurement of bulk drugs below the notified price, disputes on categorization of products, overcharging on the allegation of not following certain price control orders, allegation of delayed implementation of price ceiling notifications, etc. The Company had repudiated these demands and initiated legal proceedings to defend the Company against these alleged demands. Based on the legal assessment of these matters, certain provisions have already been made in the books, wherever necessary. The Company also has made certain deposits against these demands pursuant to directions from High Court(s).
39 Segment reporting
The Company has only one segment which is Pharmaceuticals and primarily operates in domestic market. The Managing Director of the Company has been identified as the Chief Operating Decision Maker. The Company's Managing Director, reviews the operating performance of the Company as a whole on a periodic basis. Therefore disclosure relating to segments is not applicable and accordingly not made.
Information about major customers contributing more than 10% of company's total revenue & receivable
Revenue from one customer of Pharmaceuticals business in India represents ?568.57 crore of the Company's total revenue (31 March 2025: ?590.41 crore).
Receivable from one customer of Pharmaceuticals business in India represents ?56.23 crore of the Company's total receivable (31 March 2025: ?19.18 crore).
40 Other Statutory information
(i) The Company does not have any Benami property, where any proceeding has been initiated or pending against the Company for holding any Benami property.
(ii) The Company has entered into transactions with companies struck off under Section 248 of the Companies Act, 2013 or Section 560 of Companies Act, 1956 during the financial year.
(iii) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.
(iv) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.
(v) The Company does not have any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).
(vi) No funds have been advanced or loaned or invested by the Company to or in any person(s) or entity(ies), including foreign entities ('the intermediaries'), with the understanding, whether recorded in writing or otherwise, that the intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company ('the Ultimate Beneficiaries') or provide any guarantee, security or the like on behalf the Ultimate Beneficiaries.
(vii) The Company has not been declared willful defaulter by any bank or financial institution or government or government authority.
(viii) The Company has complied with the requirements of the number of layers prescribed under clause (87) of section 2 of the Companies Act, 2013 read with Companies (Restriction on number of Layers) Rules, 2017.
(ix) The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets or both during the current or previous year.
(x) The Company has not entered into any scheme of arrangement which has an accounting impact on current or previous financial year.
(xi) No funds have been received by the Company from any person(s) or entity(ies), including foreign entities ('the Funding Parties'), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ('Ultimate Beneficiaries') or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
42 Subsequent events
There are no significant subsequent events that would require adjustments or disclosures except as disclosed below in the financial statements as on the reporting date.
a) The Board of Directors have recommended a final dividend of '75 per equity share of '10 each (750%) for the financial year ended March 31, 2026. The proposed dividend amounting to '343.11 crore is subject to the approval of the shareholders in the annual general meeting and is not recognized at the end of the reporting period.
43 Corporate social responsibility (CSR)
The Company meets the criteria specified under Section 135 of the Companies Act, 2013 and has formed a Corporate Social Responsibility (CSR) Committee to monitor the CSR activities implemented as per the CSR Policy of the Company. The Company spends in each financial year at least 2% of its average net profit for the immediately preceding three financial years as per provisions of Section 135 of the Act and in compliance of its CSR policy.
The projects are aligned in improving promotion and preventive focus on healthcare; undertake awareness and access programs in partnership with NGOs, government and healthcare providers to support Government, national and/or state programs and priorities with linkages to healthcare; and participate in disaster relief activities.
44 Exceptional items
A Net exceptional items of '49.16 crore for the year ended March 31, 2026 includes:
(i) The charge of '41.73 crore towards personnel separation cost of field force and marketing teams as a result of an exclusive Supply and Marketing Agreement with Cipla Limited for marketing and distribution of four brands of the Company, viz., Corex Dx, Corex LS, Dolonex, and Neksium and also includes personnel separation cost for other support functions.
(ii) Effective 21 November 2025, the Government of India had consolidated several existing labour laws into a unified framework consisting of four Labour Codes, collectively known as the 'New Labour Codes'. The Company has carried out an assessment based on the best available information and legal opinion, which has resulted in increase in the provision for employee benefits by '7.43 crore. The incremental impact is primarily due to change in wage definition. The Company continues to monitor the developments pertaining to the New Labour Codes and the impact, if any, will be accounted in accordance with applicable accounting standards.
B During the year ended 31 March 2025
(i) Sale of Leasehold rights and Building at Thane
In the previous year, the Company had entered into an agreement to assign and assume the Lease of Maharashtra Industrial Development Corporation ("MIDC") Land and Sale of Building constructed on such land for transferring and assigning Pfizer's unexpired leasehold rights in the land situated at Thane and sale of structures and buildings constructed thereon, to Zoetis Pharmaceutical Research Private Limited, for a lumpsum consideration of '264.40 crore, of which '52.88 crore was received as an advance. The said assets were classified as held for sale.
The Company had received requisite approvals from MIDC and has completed the transfer and sale of said assets. Net gain of '172.81 crore is disclosed as an 'Exceptional items' in the Statement of Profit and Loss.
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