The inventory management system operated by us, through our subsidiaries, has been developed and maintained by our in-
house development team of over 90 software professionals. Our inventory management system is customized to provide real-
time visibility, control and tracking of our complete inventory across our warehouses and outlets, with each product being
identified and distinguished on an SKU-basis in our system. Our system also provides extensive sales analytics for all products
stocked by us, and also drives our sourcing through an automated procurement system. We also utilize sophisticated system-
driven algorithms to track sales, identify and analyse market response to the products we sell which helps us deliver an enriching
consumer experience. Our sales algorithm also helps us to maintain a product assortment that is more responsive to the changes
in market demand, with products with high sales being replenished and restocked on a more regular basis.

We have developed a captive algorithm for sourcing our products, which computes the consolidated demand of all mapped
outlets tied to a particular warehouse and automatically generates purchase orders for estimated demand, based on historical
retail sales. The estimated demand is tied to the real-time inventory position at our stores and warehouses, and helps us ensure
that we have adequate stock of all products that are high in demand. We have also developed an automatic replenishment system
(“ARS”) to carry out a real-time evaluation of any gap between a planned stock assortment and the actual stock position at each
of stores. Currently in the pilot stage, the ARS, once implemented, will be able to compute any gaps in our store inventory on
a daily basis and arrange for the transfer of products from the supply warehouse to the store that requires stock replenishment.
This ensures that stock picking and product replenishment is carried out on an automated basis.

Logistics Infrastructure

Our logistics infrastructure comprises of a combination of our own fleet of vehicles, hired vehicles as well as third-party logistics
partners. We, through our subsidiaries, generally operate a daily supply of products to our warehouses and stores in metropolitan
cities and thrice a week to our stores in all other cities. Our dynamic distribution network also ensures that provisions can be
made for an emergency supply of products from our warehouse to a hub or outlet within a period of 24 hours, if required.

Manufacturing Facilities and Capacity

Our Company has three manufacturing plants in Telangana, located at Jeedimetla, Moosapet and Pashamylaram. At our plant
at Jeedimetla, we manufacture a range of plastic products including medicine trays, nebulisers, vaporisers, plastic bottles and
caps, and other plastic products in relation to the promotions offered by our Company. We manufacture optical frames and
spectacles at our plant at Moosapet and liquid disinfectants, toiletries and cosmetics at our plant at Pashamylara.

Installed capacity and capacity utilisation of our production plants

The following table sets forth the production plant wise installed capacity and capacity utilisation for the financial years 2019,
2020 and 2021 and the six months ended September 30, 2021:

 

 

 

 

 

Financial Year 2019 Financial Year 2020 Financial Year 2021 Se el oem
Producto Productio Productio
Location | fastaled | on * ||? aera Installed |Production!|
re 'Y | Capacity | Utilisatio ee Capacity | Utilisatio ve "Y | Capacity [6 UtilisatioCapacity (isCapacity (info Utilisatios
ers) |__ J aubersy | | mumbers) | jumbers)*4 numbers)
numbers) | numbers) numbers) numbers)
Jeedimetla | 3,049,412] NIL] NIL“ 3,581,647] 12,031 0.34 3,581,647] 30,224 oa] 2,042,218] 86,330] 4.23
Moosapet_ | — 72,000f 22,218 31] 72,000] 26,036 36/ 72,000] 22,005 31| 36,000! 7,238 20
peheny! ier 1,140] 205.66 18 1,320) 370.28 28] 1,320) 683.40 51.77 660| 621} 94.09

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

“As certified by Servel Krishna Engineers Pvt Ltd, Chartered Engineer, by way of certificate dated November 26 , 2021
* The production in the Jeedimetla plant commenced in the financial year 2020.
“*The installed capacity is for the 6 months period

Suppliers

Over the years, we have established strategic, longstanding relationships with a large number of pharmaceutical manufacturers,
clearing and forwarding agents and distributors, and have a proven ability to source a wide range of products ranging from
pharmaceuticals, over-the-counter drugs, surgical items, injectables, vaccines and fast-moving consumer goods. As a result, we
are able to benefit from significant volume-based discounts and schemes, manage a tighter inventory control and conduct data
analytics based on our historical sales, given our large sales volumes. Our multi-location sourcing capabilities also enable us to
operate and maintain a robust, dynamic and consistent supply chain.

We only source products from vendors registered on our internal stock processing network. Registration of new vendors is

completed following an elaborate and exhaustive verification process whereby each potential vendor is screened and evaluated

prior to registration. We collect all relevant identification documents and statutory licenses relating to the vendor upon

validation of which, the vendor is screened by our finance team and an independent background check is conducted. Only once

a vendor has completed its registration with us are any new orders for supplies placed to such a vendor. Once registered, we
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