Good Health Can’t Wait.

Good Health Can’t Wait.
Dr. Reddy’s Laboratories Limited
NOTES TO FINANCIAL STATEMENTS
(All amounts in Indian Rupees millions, except share data and where otherwise stated)
2.36: FINANCIAL RISK MANAGEMENT (CONTINUED)
The following table analyzes foreign currency risk from non derivative financial instruments as at 31 March2015:
(All figures in equivalent Rupees millions)
PARTICULARS U.S. DOLLARS EURO ROUBLES OTHERS (1) TOTAL
Assets:
Cash and bank balances 47 - 38 151 236
Trade receivables 35,181 934 5,758 2,957 44,830
Loans and advances and other current assets 274 14 2 91 381
Total 35,502 948 5,798 3,199 45,447
Liabilities:
Trade payables 1,841 952 - 272 3,065
Long term borrowings 9,389 - - - 9,389
Short term borrowings 14,875 2,116 3,866 - 20,857
Other liabilities and provisions 3,820 146 1,248 278 5,492
Total 29,925 3,214 5,114 550 38,803
(1)
Others include currencies such as British pounds sterling, Australian dollars, Mexican pesos, South African rand, Venezuelan bolivars, etc.
The following table analyzes foreign currency risk from non derivative financial instruments as at 31 March 2014:
(All figures in equivalent Rupees millions)
PARTICULARS U.S. DOLLARS EURO ROUBLES OTHERS (1) TOTAL
Assets:
Cash and bank balances 88 13 43 273 417
Trade receivables 29,710 914 9,910 2,209 42,743
Loans and advances and other current assets 732 553 14 2,274 3,573
Total 30,530 1,480 9,967 4,756 46,733
Liabilities:
Trade payables 1,453 1,435 - 256 3,144
Long term borrowings 9,000 - - - 9,000
Short term borrowings 7,519 1,282 6,179 - 14,980
Other liabilities and provisions 2,084 564 1,759 278 4,685
Total 20,056 3,281 7,938 534 31,809
(1)
Others include currencies such as British pounds sterling, Australian dollars, Mexican pesos, South African rand, Venezuelan bolivars, etc.
For the year ended 31 March 2015 and 2014, every 10% depreciation/appreciation in the exchange rate between the Indian rupee and the respective
currencies in the above mentioned financial assets/liabilities would affect the Company’s net profit by approximately ` 664 and ` 1,492 respectively, from
such financial assets/liabilities.
Interest rate risk
As of 31 March 2015, the Company had foreign currency loans of ` 26,366 carrying a floating interest rate of LIBOR plus 7.5 - 125 bps whereas as of 31
March 2014, the Company had foreign currency loans of ` 17,219 carrying a floating interest rate of LIBOR plus 20-179 bps and ` 846 carrying a floating
interest rate of Moscow Prime Offered Rate plus 60 bps. These loans expose the Company to risk of changes in interest rates. The Company’s treasury
department monitors the interest rate movement and manages the interest rate risk based on its policies, which include entering into interest rate swaps
as considered necessary. An increase or decrease of 10%in the floating interest rate component applicable to its loans and borrowings would affect the
Company’s net profit by approximately`4 and`10 for the year ended 31March2015 and 31March2014, respectively.
The Company’s investments in fixed deposits with banks and short term liquid mutual funds are for short durations, and therefore do not expose the
Company to significant interest rates risk.
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