Rainbow Children's Medicare Limited has informed the stock exchanges that its appeal against a GST demand notice has been disallowed by the appellate authority. The company received an order from the Principal Commissioner of Customs and Central Tax (Appeals-1) by post on May 7, 2026, whereby the appeal filed against the demand notice under Section 74(5) of the CGST Act, 2017 was disallowed and the impugned order was upheld. This disclosure was made pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, and in furtherance to an earlier disclosure dated May 31, 2024.

Background of the GST Dispute

The matter originates from a demand notice issued by the Additional Director, Directorate General of GST Intelligence (DGGI), Bengaluru Zonal Unit, under Section 74(5) of the CGST Act, 2017, which was first disclosed by the company on May 31, 2024. The company had subsequently filed an appeal before the Office of the Principal Commissioner of Customs and Central Tax (Appeals-1). However, the appellate authority has now disallowed the appeal and upheld the original demand order.

The key details of the development, as disclosed by the company in Annexure-1 filed with the stock exchanges, are summarised below:

No Settlement; Further Appeal Planned

The company has clarified that there has been no settlement of the proceedings as of the date of disclosure. Based on advice received from a subject matter expert, Rainbow Children's Medicare is in the process of preferring an appeal before the appropriate authority. No compensation, penalty, or payment has been made as of date.

The company has also stated that there is no material impact on the financial position or operations of the company at this stage. The actual financial impact, if any, will be determined upon final adjudication of the matter, along with applicable interest and penalty, if any.

Regulatory Compliance and Disclosure

The disclosure was made in compliance with Regulation 30 of the SEBI Listing Regulations, read with Master Circular No. HO/49/14/14(7)2025-CFD-POD2/I/3762/2026 dated January 30, 2026. The company has confirmed that the proceedings have been initiated against the company and do not involve any Key Managerial Personnel, Promoter, or Ultimate Person in Control. The company has stated that any further updates in this matter will be submitted to the stock exchanges in due course.

Rainbow Children's Medicare Limited (RCML) inaugurated two new healthcare facilities in Bengaluru, Karnataka on May 4, 2026 — a 60-bed spoke hospital at HRBR Layout, Hennur Junction, and a dedicated IVF centre under the BirthRight Fertility brand at Mahadevapura, positioned as an extension of the company's Marathahalli hub. The total project cost for both facilities is approximately ₹52 Crore, financed entirely through internal accruals. These additions bring the company's total bed capacity to approximately 2,435 beds across its network of 24 hospitals and 6 clinics in 9 cities.

Key Details of the New Facilities

The following table summarises the key parameters of the two newly inaugurated facilities:

Capacity and Utilisation

The following table outlines the company's bed capacity position before and after these additions:

HRBR Layout Spoke Hospital

The HRBR hospital is strategically located along the Hennur corridor in North Bengaluru, within a dense and rapidly expanding residential catchment in proximity to Manyata Tech Park. The 60-bed facility is designed to deliver comprehensive women and child healthcare services, including obstetrics and gynaecology, neonatal and paediatric intensive care, 24x7 emergency services, and consultant-led specialty paediatric clinics. Designed as a spoke within RCML's Bengaluru hub-and-spoke network, the hospital complements the Marathahalli hub, enabling referral linkages, clinical standardisation, and efficient utilisation across the network.

Mahadevapura IVF Centre

The Mahadevapura IVF centre, spanning approximately 10,000 sq. ft., is positioned as a focused extension of RCML's Marathahalli hub and is located in one of Bengaluru's largest IT corridors. Operating under the BirthRight Fertility brand, the centre offers a comprehensive suite of services across diagnostics, assisted reproduction, and complex fertility treatments. With the launch of this centre, Rainbow Children's Medicare operates a network of 15 IVF centres, with Bengaluru emerging as a key growth engine alongside Hyderabad.

Management Commentary

Commenting on the development, Dr. Ramesh Kancharla, Chairman and Managing Director, said:

"We are pleased to expand our Bengaluru network with the launch of the HRBR hospital and the Mahadevapura IVF centre, further strengthening our presence in high-growth micro-markets. These additions enhance access to integrated pediatric, obstetric, and fertility services for a young and evolving urban population. Leveraging our hub-and-spoke model and the BirthRight by Rainbow platform, we continue to deliver consistent clinical outcomes with a strong focus on quality and specialization. This expansion reflects our disciplined approach to growth and commitment to long-term value creation."

About Rainbow Children's Medicare

Rainbow Children's Medicare's network comprises 24 hospitals and 6 clinics across 9 cities, with a total bed capacity of approximately 2,435 beds (including the HRBR Hospital, Bengaluru). The company's paediatric services under Rainbow Children's Hospital include newborn and paediatric intensive care, paediatric multi-specialty services, and paediatric quaternary care including organ transplantation. Its women's care services under BirthRight by Rainbow offer perinatal care, multi-disciplinary fetal care, perinatal genetic and fertility care, and gynaecology services. The company follows a hub-and-spoke operating model and engages doctors exclusively on a full-time, retainer basis with 24/7 commitment.

Source: Company/INE961O01016/1898f20cb4d14821.pdf

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