View - Panacea Biotec

Transcription

Performance Highlights & Growth
Net Turnover
Net Worth
(Rs. in million)
(Rs. in million)
6,148
7,734
2,616
1,077
1,062
400
1998-99
2003-04
2008-09
Growing Asset Base
1998-99
2003-04
2008-09
Growing Investment in R&D
(Rs. in million)
(Rs. in million)
1,079
Revenue
9,109
Capital
Total
578
501
1,482
33 46
396
1998-99
2003-04
2008-09
79
1998-99
148
101
47
2003-04
2008-09
Safe Harbour Statement
This report contains forward-looking statements, which may be identified by their use of words like `plans', `expects', `will', `anticipates', 'believes',
'intends', 'projects', 'estimates' or other words of similar meaning. All statements that address expectations or projections about the future, including
but not limited to statements about Company's future growth drivers, product development, market position and expenditures are forward looking
statements. Forward-looking statements are based on certain assumptions and expectations of future events. The Company can not guarantee that
these assumptions and expectations are accurate and will be realised. The Company's actual results, performance or achievements could thus differ
materially from those projected in any forward-looking statements. The Company assumes no responsibility to publicly amend, modify or revise any
forward-looking statements, on the basis of any subsequent developments, information or events.
Corporate Information
(As on 30th July, 2009)
Board of Directors
R & D Centers
Promoter-Directors
•
Ambala-Chandigarh Highway
Lalru – 140 501, Punjab, India
•
B-1/E-12, Mohan Co-operative Indl. Estate
Mathura Road, New Delhi – 110 044, India
Mr. Soshil Kumar Jain Chairman
Mr. Ravinder Jain
Managing Director
Dr. Rajesh Jain
Joint Managing Director
Mr. Sandeep Jain
•
A-224, Okhla Indl. Area, Phase – I
New Delhi – 110 020, India
Mr. Sumit Jain
Director - Operations &
Projects
•
Plot No. E-4, Phase II, Indl. Area
Mohali – 160 055, Punjab, India
Independent Directors
•
Plot No. 72/3, Gen Block, T.T.C. Indl. Area
Mr. R.L. Narasimhan
Mahape, Navi Mumbai – 400 710, India
Mr. N.N. Khamitkar
Sales & Marketing Office
Mr. Sunil Kapoor
701, Sagar Tech Plaza, ‘A’ Wing, Saki Naka,
Mr. Gurmeet Singh
Andheri (East), Mumbai – 400 072, India
Mr. K.M. Lal
Statutory Auditors
Dr. A.N. Saksena
M/s. S.R. Batliboi & Co.
G.M. Legal & Company Secretary
Chartered Accountants, Gurgaon, India
Mr. Vinod Goel
Cost Auditors
Registered Office
M/s. J.P. Gupta & Associates
Cost Accountants, New Delhi, India
Registrar & Transfer Agents
Corporate Offices
M/s. Skyline Financial Services Pvt. Ltd.
•
B-1 Extn./G-3, Mohan Co-operative Indl. Estate
•
B-1 Extn./A-27, Mohan Co-operative Indl. Estate
246, Sant Nagar, 1st Floor, Main ISKCON Temple Road,
East of Kailash, New Delhi – 110 065, India
Banks
Axis Bank Ltd.
Works
IDBI Bank Ltd.
•
Indian Overseas Bank
State Bank of India
•
Malpur, Baddi, Dist. Solan
State Bank of Mysore
Himachal Pradesh – 173 205, India
State Bank of Travancore
•
B-1/E-12, Mohan Co-operative Indl. Estate
Union Bank of India
•
A-241/242, Okhla Indl. Area, Phase – I
Website
New Delhi – 110 020, India
www.panaceabiotec.com
Chairman’s Message
It’s the time of the year when I look forward to speak
to you all about your company’s performance. Our
principles and values continue to propel us towards
our vision to become the largest and most admired
health management company, leading the industry
in developing brands and vaccines that preserve and
improve human life across the globe.
In February, 2009, your company completed 25 years
of spectacular growth & success. It is a significant
milestone. We have grown from a small establishment
located in Delhi to a major player in the health
management industry and have created a significant
shareholders’ value.
We have continuously introduced new brands and
nourished our existing brands with appropriate focus
for growth. We have begun exploring alternative
ways to create value and to infuse our products and
services with even better innovative technology. Going
forward, we intend to build our portfolio of brands in a
way that gives customers multiple reasons to continue
their engagement with us. R & D is where we seed and
nurture new growth platforms and this year too we
continued to invest in it. This will help our Company to
deliver sustainable growth for many years to come.
Throughout the year, initiation of major and highly
innovative projects highlighted our team’s ability
to carry ambitious projects through to successful
completion. Responding quickly to the global
need, Panacea Biotec is partnering with WHO for
manufacturing the vaccine candidate for protection
against H1N1 virus (swine flu), a major global threat.
The financial storm that swept across the world
impacted businesses across the globe. Uncharacteristic
forex losses due to unprecedented international
currency imbalance, manifested in the aftermath of
global financial crisis. Forex losses were a bane for
many Indian companies and Panacea Biotec too was
saddled with its fair share.
Risk has become an integral part of all business
activities. It becomes our foremost responsibility to
manage it effectively and to ensure that our business
activities are beneficial to our customers & other stake
holders To mitigate it, we shall continue to focus on
rigorous investment discipline, operational excellence
and pursuing all opportunities to enhance the
underlying performance of our business.
On behalf of the Board, my sincere thanks to every
member and employee of Panacea Biotec for their
commitment, enthusiasm and unstinting efforts as
well as to all our partners and associates for their
encouragement & support, which we continue to
count on as we forge ahead.
Best wishes to you all!!
Soshil Kumar Jain
Managing Director’s Message
In the year under review, we have experienced both
change and continuity. What remained unchanged
is our tradition - commitment to innovation,
consistency and integrity - the distinct hallmarks of
Panacea Biotec.
A strong financial standing, impressive and
dedicated customer service and technological
progress at all levels reflect the steady and dynamic
nature of your company.
Panacea Biotec has been focusing its R&D efforts
on preventive as well as therapeutic healthcare
solutions. We have launched world’s first fully liquid
vaccines - EasyFour & EasyFive and have partnered
with WHO & UNICEF in their effort to maximize
coverage of vaccines under the expanded program
on immunization.
The day is not far away when Panacea Biotec would
be known as a truly global organization.
As a leading health management company, we
can deal with future challenges most effectively by
exhibiting innovation in all our systems, processes
and strategies. We are committed to introducing a
steady flow of innovative health care and vaccine
products to fulfill the unmet healthcare needs of the
masses.
Our excellence lies in execution. On the basis of
our strengths, a significant portfolio of projects,
robust pipeline of products, solid financials and the
confidence of our stakeholders, your company is
looking ahead to pursue steady and well balanced
growth and exhibit significant global presence.
Our goal remains to create long term wealth for
our shareholders. We’ll continue to build a multispecialty company with a goal to become a leading
health management company across the world.
I express my heartily thanks and look forward to
your continued support as stakeholders of the
company. It is with your valuable support that
we can achieve our vision to be a global health
management Company.
With best wishes!!
Ravinder Jain
Financial Highlights
Particulars
(Rs. in million)
2008-09 2007-08 2006-07 2005-06 2004-05 2003-04 2002-03 2001-02 2000-01 1999-00
Financial Performance
Summary
Net Turnover
7,734.2 8,304.4 8,315.5 5,363.5 3,255.4 2,616.2 2,691.5 2,739.3 2,176.7 1,866.3
Total Income
7,993.9 8,676.2 8,615.1 5,434.5 3,309.9 2,686.7 2,733.0 2,763.4 2,251.7 1,873.8
EBITDA
2,444.6 2,177.6 2,298.8 1,233.8
652.3
389.2
520.5
547.0
480.0
412.7
PBT
(923.7) 1,903.9 2,091.0 1,002.1
429.4
217.6
336.3
406.4
426.1
329.3
PAT
(690.5) 1,331.7 1,468.1
609.4
300.7
164.5
214.2
249.3
228.8
259.3
Cash Accruals
2,001.4 1,802.2 1,823.2
791.6
463.1
283.2
310.5
314.5
287.6
291.0
57.2
57.2
57.2
57.2
Balance Sheet Summary
Equity Share Capital
Preference Share Capital
66.8
66.8
65.8
57.2
57.2
57.2
-
-
-
904.3
904.3
957.8
53.5
63.0
68.0
100.0
Reserves & Surplus
6,084.7 6,905.3 5,325.1 1,546.0 1,192.4 1,039.0
948.1
805.8
701.6
546.0
Net Worth
6,147.9 6,966.7 5,383.9 1,593.6 1,235.1 1,076.9
981.2
839.9
754.5
603.2
Loan Funds
7,002.9 3,982.4 2,134.2 5,866.5 1,610.4 1,680.2 1,292.2 1,060.1
719.8
681.3
-
-
Deferred Tax Liability
Total Liabilities
333.8
595.0
383.9
246.8
135.1
74.8
6,938.7 5,343.7 4,136.1 2,337.1 1,376.8 1,054.5
Investments
2,165.7 2,049.3
FCMITDA Net Current Assets
Miscellaneous Expenditure
Total Assets
73.5
13,488.2 11,549.5 7,909.0 8,620.9 3,899.3 3,808.9 2,411.6 2,059.5 1,546.6 1,384.5
Net Fixed Assets
†
60.6
963.0
893.5
565.3
408.4
229.5
61.4
61.4
39.1
52.6
52.6
47.1
18.1
-
-
-
-
-
-
-
-
4,284.2 4,151.2 3,536.4 6,212.8 2,446.7 2,696.0 1,371.8 1,090.4
929.9
958.0
4.3
-
96.0
3.6
-
5.3
7.0
9.6
14.4
19.3
24.1
23.1
13,488.2 11,549.5 7,909.0 8,620.9 3,899.3 3,808.9 2,411.6 2,059.5 1,546.6 1,384.5
Key Performance Indicators
Profitability Ratios
EBITDA Margin
32%
26%
28%
23%
20%
15%
19%
20%
22%
22%
PBT Margin (12%)
23%
25%
19%
13%
8%
12%
15%
20%
18%
PAT Margin
(9%)
16%
18%
11%
9%
6%
8%
9%
11%
14%
-
100%
100%
100%
150%
100%
100%
100%
100%
100%
(10.3)
20.1
23.7
9.9
4.4
2.7
3.6
4.2
3.8
4.4
30.0
27.0
29.5
13.1
7.2
4.8
5.3
5.4
4.9
4.9
Book Value* (in Rs.)
92.1
104.3
81.9
27.9
21.6
18.8
17.2
14.7
13.2
10.6
Return on Net Worth
(11%)
19%
27%
35%
19%
14%
20%
29%
28%
40%
Current Ratio
1.6
2.8
3.0
2.8
1.4
1.7
1.3
1.3
1.3
1.4
Debt Equity Ratio
0.9
0.5
0.4
2.9
0.3
0.5
0.4
0.4
0.1
0.2
(6%)
13%
20%
8%
10%
8%
14%
17%
19%
23%
Interest Coverage Ratio
7.6
18.7
15.1
10.4
6.6
3.2
4.0
5.5
6.8
7.0
Debt Service Coverage Ratio
7.2
16.2
6.8
4.1
2.3
1.6
2.8
3.5
1.8
5.9
Shareholders related Ratios
Equity Dividend
EPS (Basic)* (in Rs.)
Cash EPS (Basic)* (in Rs.)
Other Ratios
Return on Capital Employed
Foreign Currency Monetary Item Translation Difference Account
*Per Equity Share of Re.1 each.
†
Contents
Setting the Scene
Management Discussion & Analysis Report
•
•
•
•
•
•
•
•
•
•
•
•
•
2
Financial Statements
3
•
•
•
Industry Structure & Developments
•
•
Panacea Biotec - Innovation in Support of Life
Business Segments
Pharmaceutical Formulations
Vaccines
Manufacturing Facilities
Balance Sheet
Profit & Loss Account
Schedules to Balance Sheet and
Cash Flow Statement
Statement u/s 212 in respect of
Subsidiary Companies
•
Financial details of Subsidiary Companies
Auditors’ Report on Consolidated Financial Statements
99
and Tie-ups
Consolidated Financial Statements
100
•
•
•
Research & Development
Subsidiaries, Joint Ventures, Collaborations
Opportunities & Outlook
Future Growth Drivers
Consolidated Balance Sheet
Consolidated Profit & Loss Account
Schedules to Consolidated Balance Sheet and
Risks, Challenges & Threats
Corporate Social Responsibility
•
Consolidated Cash Flow Statement
Directors’ Report
43
Corporate Governance Report
53
Auditors’ Report
66
1
68
Panacea Biotec • Annual Report 2008-09
Setting the Scene
•
Panacea Biotec is the 2nd Largest Vaccine
producer in India
•
1,158 patent applications filed, 325 granted/
accepted for grant globally as on 31.03.2009
•
3rd Largest Biotechnology Company in India
(ABLE Survey 2009)
•
Company’s Products reach more than
35 countries globally
•
Panacea Biotec has been pre-qualified by
WHO to supply Oral Polio, Hepatitis B, Ecovac4
(DTwP-Hep B), Easyfour (DTwP-Hib) and Easyfive
(DTwP-Hep B-Hib) Vaccines
•
Played a key role in eradicating polio by supplying
more than 6 billion doses of Oral Polio Vaccine to
Govt. of India & UNICEF
•
Millions of patients enjoying happy & healthy
life through our well established brands in niche
therapeutic areas like pain management, diabetes
management, organ transplant
•
Stupendous contribution to Shareholders’ value
•
Continuous investment in Research &
Development activities - around 14% of net
turnover invested during fiscal 2009
•
Over 260 Scientists working in 5 state-of-the art
R&D Centers
•
A family of around 3,200 people working
relentlessly in improving quality of life of billions of
people across the globe
•
First Indian company to develop and launch
innovative combination vaccines viz. Ecovac4,
Easyfour and Easyfive in India
•
Ranked 48th amongst Pharmaceutical Companies
in India (ORG IMS MAT March’09)
•
Pharmaceutical formulation facility at Baddi
certified as cGMP compliant by various regulatory
authorities including the German Regulatory
Authority and ANVISA (Brazil)
•
26 product patents valid in more than 60 countries
world wide
Management Discussion
and Analysis
Industry Structure &
Developments
Global Vaccine Industry
of them being, the Global Immunization
Vision and Strategy (GIVS), launched in
2005. In brief, GIVS aims to assist countries
to immunize more people, from infants to
The global market for vaccines is expected
seniors, with a greater range of vaccines.
to grow at a CAGR of more than 16% in the
GIVS is the first ever global ten-year
next five years and is expected to reach US$
framework to fight vaccine-preventable
30 billion by 2012, as per various industry
diseases through immunization and covers
estimates. The vaccine industry will emerge
the period 2006 to 2015.
as the fastest growing therapeutic area.
The US and Europe represents the two
largest vaccine markets and will continue to
GIVS has four main aims:
•
diseases, to reduce childhood morbidity
experience healthy growth in future.
Presently, Paediatric vaccines dominate
the global vaccines market but the share
of adult and therapeutic vaccines is likely
to increase significantly and will fuel the
future growth in the global vaccines market.
The cancer vaccine market, led by cervical
cancer vaccines, is presently one of the most
lucrative areas for vaccine manufacturers.
to immunize more people against more
and mortality;
•
to introduce a range of newly available
vaccines and technologies;
•
to integrate other critical health
interventions with immunization; and
•
to manage vaccination programmes
within the context of global
interdependence.
Overall, cancer vaccines are expected to
account for nearly 27% of the total vaccine
revenues by 2012. Successful development
of vaccines against pandemic flu, Pneumo,
Dengue, HIV & TB in addition to the
Hexavalent paediatric combination vaccines
would add to the growth of the vaccine
industry.
Indian Vaccine Market
India represents one of the fastest
growing vaccine markets in the world.
With the national immunization program
(NIP) gaining more importance, several
multinational companies now see India as
a key market for their vaccine business. As
Immunization is the most important and
per industry estimates, the Indian vaccine
cost-effective way of eliminating child
market was US$665 million in 2007-08
mortality. The development of combination
and is growing at over 20%. This market is
vaccines has resulted in lower cost of
primarily driven by exports worth more than
immunization and simplified the current
US$360 million. The domestic market for
immunization schedule as it offers an
vaccines is around US$300 million with the
opportunity of fighting against multiple
private sector accounting for around half
diseases with a single injection.
of it.
WHO and UNICEF have taken a number
Domestic companies presently dominate
of measures to boost the awareness and
this market with around seven out of top
access to vaccines in their efforts to meet
ten players being domestic companies. But
the challenges in global immunization. One
with India’s IPR (Intellectual Property Right)
3
The global
market for
vaccines is
expected to
grow at a CAGR
of more than
16% in the next
five years and is
expected to reach
US$ 30 billion by
2012.
laws improving considerably and healthcare
expenditure increasing, foreign companies
have started to acknowledge India’s
potential as a vaccine hub.
Polio Eradication in India
The goal of Global Polio Eradication Initiative
(GPEI) is to ensure that no child will ever
again know the crippling effects of polio.
Owing to the factors like increasing public
Polio is a highly infectious disease which
and private healthcare spending, birth of
invades the nervous system and can cause
around 25 million babies each year and
total paralysis in a matter of hours. It can
a large prevalence of both infectious and
strike at any age, but affects mainly children
chronic diseases, the domestic demand
under five. Polio is mainly passed through
for vaccines in India will continue to grow
person-to-person (i.e. fecal-oral) contact,
at double-digit growth rate, offering
and infects those who do not have immunity
vaccine players enough challenges and
against the disease. There is no cure for
opportunities to expand their horizon in the
polio, but the disease can be prevented by
country.
immunization with polio vaccine.
Apart from the domestic market, India is
also emerging as a center for exports. Both
research and manufacturing of vaccines can
be undertaken in India at much lower cost
than in the west. Exports presently account
for more than 50% of the country’s vaccine
market and with growing investment by
both domestic and international players,
India is expected to fulfill the vaccine
demand of both developing and developed
countries alike.
Year 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
2009
Polio Cases Data
No. of Polio Cases
1934
1126
265
268
1600
225
134
66
676
874
559
206*
(Source: www.npspindia.org) *data as on July, 2009
As per WHO guidelines, a WHO region can be
Vaccine to Inactivated Polio Vaccine (IPV).
certified polio free only if it does not record
In those countries, where polio has been
any case of polio during three consecutive
eradicated, IPV is being used. The world
years following the year in which zero case
health regulatory bodies suggest that the
is registered first time. Assuming that India
vaccination against polio must continue even
achieves zero case for the first time in 2010
after achieving polio eradication.
and thereafter, if it does not record any case
of polio in 2011, 2012 and 2013, India can
achieve its target of becoming polio free and
Global Pharmaceutical Market
become eligible for being declared as a polio
The global pharmaceutical market audited
free nation by WHO. However, immunization
sales grew by approximately 5.1% (at
activities will continue until the entire region
constant exchange rate) to reach US$726
(Pakistan & Afghanistan) becomes polio free.
billion in 2008. (Source: IMS MAT Sept.’08),
Immunization against Polio to
largely as a result of strong sales for new
Continue: In developing countries, low
innovative products and high market growth
OPV effectiveness in the highest-risk
in emerging pharmaceutical markets such as
communities (believed to be caused by a
India and China.
combination of high incidence of diarrheal
The global pharmaceutical market is
diseases, malnutrition and the high force
expected to grow 4.5 - 5.5 percent in 2009 (a
of Wild Polio Virus infection attributed to
pace similar to 2008) and reach the level of
crowding) has been identified as the key
more than US$820 billion and is expected to
challenge to interrupting Wild Polio Virus
reach US$929 billion in 2012.
transmission. Responses being explored,
North America, Europe and Japan continued
include inactivated poliovirus vaccine as a
to remain the key markets accounting for
supplement to Oral Polio Vaccine (mOPV) &
85% of the global pharmaceutical market
development of a bivalent OPV containing
in 2008. The emerging economies further
both type 1 and type 3 virus.
consolidated their position in the global
The immunization against polio will
arena with growth in countries like India,
continue in the post polio eradication
China, Russia, Brazil and Turkey exceeding
era. It is expected that the mode of
the growth in developed markets and are
immunization may change from Oral Polio
expecting to continue with the trend.
Region-wise Global Pharmaceutical Sales, 2008
Audited Market 2008 Sales*
% Growth
US $ bn % Mkt Share
(Constant US$)
North America
Europe
Asia, Africa & Australia
Japan Latin America 312
242
72
65
35
43
33
10
9
5
1.5
6.2
15.0
4.4
12.0
Total Audited
726
100
6.1
*Excludes unaudited markets and Russia, Ukraine and Belarus audited data. Sales cover direct and indirect
pharmaceutical channel purchases in U.S. dollars from pharmaceutical wholesalers and manufacturers.
The figures above include prescription and certain over-the-counter data and represent manufacturer prices.
Total may not add due to rounding off.
As a result of the pharmaceutical industry’s increased focus on these high-growth markets, the
developing countries are benefiting from greater government spending on healthcare and
broader public and private healthcare funding - which is driving greater access to, and demand
for, innovative medicines.
5
The global
pharmaceutical
market is
expected to grow
4.5 - 5.5 percent
in 2009 (a pace
similar to 2008)
and will reach
the level of more
than US$820
billion and is
expected to reach
US$929 billion in
2012.
The cost of research and development is
rich product pipeline under development &
continuously increasing due to multiple
the research capabilities of the innovator and
reasons including the cost of failure but
the innovator benefits from lower research
in the year 2007 there is a decline in R&D
& development cost and reach in emerging
expenditure. The continuous R&D spending
markets of the generic partner, hence
has increased but the number of New
realizing higher gains from existing portfolio.
Molecular Entities (NMEs) and biologics
With competitive advantages in terms of
approved by FDA is down.
R&D, manufacturing and marketing, Indian
companies are today in a strong position
to partner with innovator pharmaceutical
companies.
Indian Pharmaceutical Market
The Indian pharmaceutical industry is one
of the fastest growing and the safest sectors
in Indian economy. It is one of the world’s
The pharmaceutical industry has, in the
largest and most developed, ranking 4th in
recent past, seen a trend of alliances and
volume terms and 13th in value terms. India
deals between innovators and generic
accounted for 8% of global production and
companies creating a collaborative business
2% of world markets in pharmaceuticals. The
model. The generic partner gets access to
Indian Pharmaceutical market is valued at
Rs.353.7 billion and growing at 10.1% as per
diabetics category has recorded the highest
ORG MAT Mar’09.
growth at 16% adding an incremental
The Indian Pharmaceutical Market is
expected to treble in the next decade and
catapult the country into top 10 markets
in the World by 2015, overtaking Mexico,
Turkey & South Korea.
value of Rs.2.6 billion. Other categories
with substantial presence of the Company,
viz. Pain & Analgesic and GI & Respiratory
have shown decent growth of 9% and 8%
respectively.
With higher per capita income, increasing
access to modern medicines, the emergence
of an organised retail segment and the fast
growing area of medical insurance, this
segment is expected to continue its strong
growth momentum and is estimated to
be worth US$30 billion by 2020, growing
The chronic therapy segment recorded a
growth of 13.1% and contributed 28.3%
of the total market while acute therapy
segment grew at a rate of 8.6%. The
overall market growth was a mix of higher
volumes of existing products, new product
introductions and price increases with all
three witnessing a positive trend. Around
75% of the overall market growth was led by
at about 8% annually as compared to an
increase of 6% in the world as a whole.
But, even then, India’s share in the world
pharmaceutical market would only come to
slightly over 2%.
Playing a key role in promoting and
sustaining development in the vital field of
medicines, Indian Pharma Industry boasts of
quality producers and many units approved
volume increases in existing products.
by regulatory authorities in USA and UK.
Semi-urban and rural markets are becoming
The Indian Pharmaceutical sector is
an important driver for growth in the Indian
highly fragmented with more than
market. Extra-urban markets accounted
20,000 registered units. The leading 250
for 40% of the total sales in 2008. Acute
pharmaceutical companies control around
therapies dominate the extra-urban markets
70% of the market with market leader
with 80% contribution while chronic
holding nearly 7% of the market share. It is
therapies are also growing especially in
an extremely fragmented market with severe
cardiac therapy (8%).
price competition and government price
In the coming years, upcoming small cities
control.
and rural areas will contribute almost as
The pharmaceutical industry in India meets
much to the pharma market growth as
around 70% of the country’s demand
metros and top-tier towns.
for bulk drugs, drug intermediates and
Amongst the markets where the Company
operates the highest contributing group is
anti-biotics (contributing around 18% to IPM)
and growing at par as compared to IPM and
has added an incremental value of Rs.5.6
billion last year.
pharmaceutical formulations. There are
about 250 large units and about 8,000
Small Scale Units, which form the core
of the pharmaceutical industry in India
(including 5 Central Public Sector Units).
These units produce the complete range of
pharmaceutical formulations, i.e., medicines
The second largest group in terms of
ready for consumption by patients and
value contribution to IPM, Cardio Vascular
about 350 bulk drugs, i.e., chemicals having
system has recorded 13% growth with an
therapeutic value and used for production of
incremental value of Rs.4.6 billion. The anti-
pharmaceutical formulations.
7
The Indian
pharmaceutical
industry is one
of the fastest
growing and the
safest sectors in
Indian economy.
It is one of the
world’s largest
and most
developed,
ranking 4th in
volume terms
and 13th in value
terms.
Panacea Biotec – Innovation
in Support of Life
Panacea Biotec occupies a distinct
position in the Indian pharmaceutical and
biotechnology industry with its business
model focussing on innovation, collaboration
development and product registration. The
current research strengths of Panacea Biotec
are focused, inter-alia, on:
•
optimization;
•
Discovery and synthesis of new chemical
and biological entities;
and brand building. The Company has
endeavoured to provide research based
Drug delivery system design and
•
Design and development of new
products to fulfil the unmet medical needs.
generation prophylactic and therapeutic
The Company has established infrastructure
vaccines; and
and capabilities in research & development,
•
Development of humanized and
manufacturing and marketing of vaccines,
fully human therapeutic monoclonal
pharmaceuticals and biopharmaceuticals.
antibodies.
Panacea Biotec occupies the position of the
The Company has been granted 26 product
2nd largest vaccine producer in India and has
patents worldwide valid in more than 60
been ranked as the 3rd largest biotechnology
countries including the U.S., E.U. Member
Company (ABLE Survey 2009). Based on
State, Russia, Japan, China, South Korea,
the finished pharmaceutical formulations
Australia and Brazil.
business, the Company is placed at 48th rank
amongst pharmaceutical companies in India
(ORG IMS MAT March 2009).
State-of-the-art manufacturing
facilities: Panacea Biotec has state of the
art manufacturing facilities for vaccines
The Company has also moved ahead towards
and pharmaceuticals complying to cGMP
diversification in the field of healthcare
standards. The Company is setting up
through its subsidiaries as part of its
bulk vaccine manufacturing facility for cell
corporate vision to become a leading Health
culture based vaccines, biopharmaceuticals,
Management Company.
recombinant and viral vaccines at Lalru,
Punjab.
Core Strengths at a glance
Panacea Biotec is well positioned and
recognized as a leading, research based
Health Management Company with
an objective to discover, develop and
successfully market innovative products to
meet unmet medical needs. To achieve these
objectives, Panacea Biotec has:
The vaccine formulation facility at New
Delhi is approved by WHO for Oral Polio
and Recombinant Hepatitis B vaccines and
Combination vaccines Ecovac-4 (DTwPHepB), Easyfour (DTwP-Hib) and Easyfive
(DTwP-HepB-Hib). The Pharmaceutical
Formulations facility at Baddi has been
audited and certified as cGMP compliant by
various regulatory agencies, including the
Established capabilities in R&D: Panacea
German Regulatory Authority and ANVISA
Biotec has established five state-of-the-art
(Brazil).
R&D Centers with each center dedicated
to specific research areas, driven by the
intellectual capabilities of over 260 scientists.
WHO Pre-qualification Status: The
pre-qualified supplier status enables the
Company to participate in UN Organizations
The research facilities are self-reliant with
procurement process around the world. The
cross-functional capabilities for research and
Company has been pre-qualified by WHO to
development of drugs starting right from
supply Oral Polio (mOPV and tOPV), HepB,
lead identification to pre-clinical and clinical
Ecovac-4, Easyfour and Easyfive Vaccines.
9
Panacea Biotec
occupies the
position of the
2nd largest
vaccine producer
in India and has
been ranked as
the 3rd largest
biotechnology
Company (ABLE
Survey 2009).
The Company is currently supplying Oral
Polio, Hepatitis B and Easyfive Vaccines to
UNICEF. The Company has also commenced
supplying Easyfive Vaccines to Pan American
Health Organization (PAHO) during fiscal
2009.
has been supplying oral polio vaccines to
Established Brand Equity: Panacea Biotec
has established brand equity in a number of
therapeutic areas like diabetes management,
pain management, organ transplantation
and paediatric immunization. Its leading
brands including Glizid-M, Nimulid, Panimun
Bioral, Pangraf and Mycept are amongst
the top five positions in their respective
therapeutic segments. Its flagship brand,
Glizid-M is ranked at 171 amongst the top
brands in Indian Pharmaceutical Market,
according to the stockists secondary audit by
ORG IMS (MAT Mar’09).
with its customers, the relationships with
International Presence: In addition to the
strategic alliances with leading regional
companies in Latin America, South East Asia,
CIS and Africa; Panacea Biotec has created a
global presence through its wholly-owned
subsidiaries in strategic markets including
US, Germany, Switzerland and UAE.
UNICEF since fiscal 2000 and has steadily
expanded and grown on this relationship
with the commencement of supply of
Easyfive vaccines during fiscal 2009. In
addition to long-standing relationship
key suppliers like Novartis Vaccines, Sanofi
Pasteur and PT Bio Farma are also a source of
its competitive strength.
Collaborations & Joint Ventures with Key
Industry Players: Panacea Biotec has a
rich history of collaborations and ventures
with various industry players and has
several business relationships with various
national/international research institutes,
academic universities and commercial
corporations including National Institutes
of Health (USA), Novartis Vaccines, Sanofi
Aventis, Biotech Consortium India Ltd.,
Nederland Vaccin Institut (NVI), PT Bio Farma,
etc. These collaborations, ventures and
relationships enable the Company to secure
in-licensing, out-sourcing and other business
opportunities.
Relationship with Key Business Associates:
Panacea Biotec has a long-standing
relationship with its key customers and
business partners including successful
business record of 10 years with UNICEF. It
Qualified & Experienced Manpower:
10
Panacea Biotec has 3,196 employees
including 261 scientists engaged in R&D,
1,006 in production and 1,213 in sales &
marketing.
Business Segments
Diacar Alpha & Diacar Delta
Domestic Sales & Marketing
Network
Diacar Alpha & Diacar Delta together
Panacea Biotec has successfully established
leading brands through a focused scientific
marketing approach. To cater to the
individual nuances of specific therapeutic
segments, Panacea Biotec operates through
seven strategic business units (SBUs).
The domestic pharmaceutical business
is organised into three classes – Superspeciality i.e., Critical Care & OncoTrust,
Speciality i.e., Diacar Alpha & Diacar Delta
are the highest contributing SBU of the
Company with dedicated marketing
and sales infrastructure for Diabetes and
Cardiovascular management. These SBUs
are committed to provide new therapies
and innovations in drug delivery and overall
diabetes disease management. India’s
diabetic population is estimated to be
around 41 million and growing rapidly. WHO
estimates that diabetes related mortality
could increase to 35% by 2015.
and Multi-specialty i.e., Procare & Growcare.
These SBU promote the brands to
To cater to the large and voluminous
target specialists viz. Endocrinologists,
bottom of the Indian Pharmaceutical Market
Diabetologists, Cardiologists and Physicians
pyramid, the Company has taken an initiative
in a fiercely competitive scenario and have
by launching a new SBU, viz. Value India
achieved significant leadership position
Healthcare.
in oral anti-diabetic segment. Of late
The aim of each SBU is to attain leadership
position in its chosen markets and establish
the SBU has also started focusing on the
Nephrologists.
brand equity in respective therapeutic
To tap the growing cardiology segment
segment by way of innovative products as
the SBU now has sharpened its focus on
well as innovative marketing approach with
Cardiology by having an additional team
differentiated products. The SBUs promote
which would have a dual focus on Cardiology
a portfolio of brands with a special focus on
and Diabetology.
Orthopedicians, Cardiologists, Diabetologists,
The flagship brand of the SBU, Glizid-M
Physicians, Nephrologists, Chest Physicians,
Surgeons, Dentists, Consulting Physicians,
Paediatricians and Gastro-enterologists.
11
(Gliclazide + Metformin) is the No. 1 brand
while Glizid (Gliclazide) is the no. 2 brand in
their respective categories. Glizid-M apart
from the above is ranked at 171st position
(Tacrolimus) continued to be the
amongst 30,000 odd pharmaceutical brands.
most preferred and trusted brand of
Apart from Glizid-M and Glizid, the brand
Tacrolimus in the country. Panimun Bioral
portfolio of this SBU includes:
(Cyclosporine) maintained its position
Oral Hypoglycemic agents: Glizid MR
(Gliclazide modified release), Betaglim
(Glimepiride), Betaglim M (Glimepiride
+ Metformin), Metlong & Metlong DS
(Metformin), Pioryl (Pioglitazone +
Glimepiride), Oglo (Pioglitazone), Gliben
Total, Glizid Total, Glim Total and Myelogen
Forte.
Cardiovascular: Lower A (Atorvastatin),
Lower EZ (Atorvastatin + Ezetimibe), Lower
TG (Atorvastatin + Fenofibrate), Kingbeta
(Metoprolol) and Hitarget (Telmisartan)
range.
in the Cyclosporine market owing to the
wealth of experience and confidence in
it. Mycept-S (Mycophenolate sodium)
surging ahead, provided valuable support
to Mycept (Mycophenolate mofetil). Fosbait
(Lanthanum carbonate) grew significantly in
the year, as also did Siropan (Sirolimus).
The year under review was also a
momentous year for the Critical Care SBU.
It entered into Rs.1.2 billion Erythropoietin
market with EPOTrust, which since its
launch has been able to establish itself
as a prominent player in the market. The
introduction of K-Bait (Calcium Polystyrene
New product launches during the year
Sulphonate) a treatment for Hyperkalemia in
include the Hitarget (Telmisartan) range of
Chronic Kidney Disease (CKD) patients also
Products.
complemented the thrust in the Nephrology
portfolio.
Critical Care
Critical Care SBU consolidated and
strengthened its leadership status in
Nephrology and Organ Transplantation in
the year 2008-09 by organic growth as well
as by entering newer markets with new
brand introductions.
Standalone conferences like Renal Summit
III and participation in various conferences
re-inforced the scientific image and
enhanced the reputation of Critical Care
SBU throughout the year. Fully aware that
newer specialities like Rheumatology and
Haematology provide opportunity for the
growth of existing brands, it is consciously
Aided by a dominant penetration in
working on making these opportunities
the Transplantation segment, PanGraf
into viable business propositions. In the
12
coming years, Critical Care SBU proposes to
Procare has taken definite steps towards
launch molecules aimed at satisfying unmet
making significant inroads in the
medical needs, thereby aiming to grow faster
Gastroenterology segment with two
and become bigger in the Nephrology and
important launches of Livoluk Fibre
Transplantation market.
(Lactulose + Isapghula) and Sitcom
(Euphorbia Prostata) during the year.
Procare
This SBU promotes a portfolio of brands with
Procare SBU of the Company endeavours to
Dentists & Gastroenterologists apart from
consolidate and strengthen its image in the
Consulting Physicians & General Physicians.
field of chronic health care management
with specific focus on Osteoarthritis, Pain
management and Gastrointestinal disorders.
Pain is a frequent cause for clinical visits
with around 45% of the population seeking
medical help for pain at some point in their
special focus on Orthopedicians, Surgeons,
Some of the major brands of Procare across
different therapeutic segments are:
Anti-arthritis: Willgo, Kondro OD,
KondroAcute
Pain relievers: Nimulid, Nimulid SP, Nimulid
lives. Pain occurs across the life span, and
MR, Nimulid HF
it has been estimated that 4 out of every
Gastrointestinals: Livoluk, Livoluk Fibre,
10 people with moderate or severe pain
OD-pep, Sitcom
do not get adequate relief. Chronic pain is
widely believed to represent a disease itself
causing long-term detrimental changes in
Anti-osteoporosis: Alphadol, Alphadol-C,
Kingcal.
musculoskeletal and nervous system. Pain
On the prescription front there has been gain
interferes with sleep, activities of daily living
in equity from Specialties like Gastro and
and productivity. In order to help millions
Ortho during the year under review.
of patients suffering from various painful
inflammatory disorders, Procare SBU is
marching ahead to provide therapeutic
Growcare
modalities to these patients and has recently
Growcare is the Multi-Specialty business
launched JAIHO (Lornoxicam + Paracetamol)
of Panacea Biotec with special focus
in pain management segment.
in Respiratory Disorders. The different
13
specialties covered are Chest physicians,
Tumor and a supportive therapy for patients
Consulting Physicians, General Physicians,
suffering from bone metastases.
ENT, Paediatricians, Surgeons and
Orthopedicians. 37 different products are
marketed by this SBU with presence in
multiple therapy areas.
Some of the popular brands of Growcare are:
Anti-infective: Cefmentin (Cefixime+
Lactobacillus), Ocimix (Ornidazole+Ofloxacin)
The Brand Portfolio includes PacliTrust
(Paclitaxel Injection); DoceTrust (Docetaxel
Injection); GemTrust (Gemcitabine injection);
TemoTrust (Temzolomide Capsules) and
ZoleTrust (Zoledronic Acid Injection). Two
new brands, viz. GefiTrust (Gefitinib) and
OxiTrust (Oxaliplatin) were launched during
the year under review. The ‘Trust’ umbrella
Anti-Allergic: Zomont Range
branding has gained recognition amongst
Cough, Cold and Fever: Toff MD, Toff DC &
the oncologist community and is helping
Toff expectorant, Orangemol Suspension
build OncoTrust as a big brand.
Pain Management: Nimulid MD & Nimulid
MD Kid (Mouth dissolving) tablets, Nimulid
Suspension, Nimulid Transgel.
Value India Healthcare
Value India Healthcare is the SBU launched
Anti TB: Xeed 2, Xeed 3E & Xeed 4 tablets
to cater to mass markets. This SBU’s main
fixed dose combinations, Myser (Cycloserine)
aim is to provide a unique ‘value for money’
& Myobid (Ethionamide).
proposition in its offering to the General
Anti haemmorohidal: Thank OD Tablets.
Physicians practicing mainly in semi-urban
and rural set up.
OncoTrust
The overall size
of the domestic
oncology market
is around Rs.9.6
billion and is
growing at
around 22%.
More than 50%
of the world’s
cancer burden,
in terms of
both number
of cases and
deaths, occurs
in developing
countries.
This SBU is setting a trend in offering
significant innovative brands to fight pain,
Panacea Biotec made its maiden entry into
allergy and gastro-intestinal disorders to
the rapidly growing field of Oncology in
the semi urban and rural markets. The
fiscal 2008 with launch of a new SBU called
main brands are TwoWks, Combipunch,
‘OncoTrust’. Oncology as a therapeutic
Instanim MD, TwinEase ER, RojOD, Takecal,
segment is rated as one of the fastest
Kofzero and Koldzero. Anti-infectives as a
growing fields globally and in India also.
class is a fast growing market. The Value
The Oncology market is well poised for a
range of anti-infectives offered by the SBU,
promising future ahead with steady increase
ValueCef, ValueOrni, ValueMox, ValueMentin,
in cancer incidence rate, superior and more
ValueLevo and ValueThral are steadily
accessible diagnostic facilities, increased
gaining acceptance.
awareness about the disease and feverish
pace of new molecule introduction. The
overall size of the domestic oncology market
is around Rs.9.6 billion and is growing at
around 22%. More than 50% of the world’s
This SBU currently operates in Rest of
Maharashtra region, Madhya Pradesh and
Chattisgarh with plans for expansion to other
states in due course of time.
cancer burden, in terms of both number
of cases and deaths, occurs in developing
countries.
Brands Review
Over the years, Panacea Biotec has
The current product portfolio of OncoTrust
established leading brands that enjoy top
comprises of Cytotoxic chemotherapy
of the mind recall by the medical fraternity.
covering indications therapeutic segments
The Company’s brands command excellent
such as Breast Cancer, Lung Cancer,
market share in their therapeutic segments.
Pancreatic Cancer, Ovarian Cancer and Brain
By ORG (MAT Mar’09) Sales value, Panacea
14
the Indian Pharmaceutical Market with
International Pharmaceuticals
Business
Nephrologists, Dentists, Orthopaedicians and
The year under review marked the
Diabetologists giving the best support. As
achievement of landmark initiatives &
per Stockist Secondary Audit of ORG (MAT
accolades for the Company’s international
Mar’09), Glizid-M stands at 171st rank among
formulations business. The Company clocked
Top brands in the Indian Pharmaceutical
a robust sales growth of 27% over previous
market and retain number one position
year and reached to a level of Rs.426.1
within its category.
million. The major markets continue to do
The following table set forth the key
well inspite of recessionary trends in the later
Biotec is the 50th ranked company in
part of the year. In addition to this, successful
brands of the Company across therapeutic
categories and their ranking/ market share in
India as per ORG IMS audit:
•
•
The Company has identified Organ
Market Ranking
Share %
Diabetes and Cardiac Care:
Glizid M
Glizid 80mg
Glizid 40 mg
Glizid MR 60mg
Glizid MR 30mg
Glizid Total
Pain Management:
Willgo
Nimulid MD
Nimulid 100mg
Nimulid Suspension
Nimulid Safeinject
Nimulid Transgel
Nimulid Nugel
Nimulid SP
Nimulid MR
Softdiclo
Kondro OD
Tuberculosis Management:
Myser
Gastro-intestinal:
Livoluk markets across Central America, Africa and
Asia.
Brand Standing and Market share
Brands
commercialization happened in newer
24
23
31
13
16
21
1
1
1
2
2
2
60
28
7
14
15
17
11
10
12
11
21
1
1
2
2
2
2
2
4
4
3
3
19
3
8
4
Source of the data is ORG IMS SSA audit MAR
2009.
Market Share and rank is calculated within
its immediate operating market i.e the
strength or the immediate market (wherever
applicable).
Transplantation, Nephrology, Metabolic
Disorders, Pain management, Oncology,
Gastro-intestinal & Anti-infective products
as major thrust areas for the future. The
Company is currently in the process of
registering its products in key new markets
including US, European Union, Switzerland,
South Africa, Turkey, Brazil, Mexico,
Columbia, Venezuela, Chile, Philippines
& Malaysia. The Company has set-up
international subsidiaries in US, Germany,
Switzerland and UAE to steer product
registration.
The Company focuses on brand building
primarily leveraging its portfolio of novel
patented products in key segments. The
major achievements in terms of international
formulation business during the year have
been:
•
product, Mycept in the 1st year of
commercialization to Russian Ministry of
Health.
•
Introduction of 10 products especially
in the Nephrology & Organ Transplant
category in various markets.
Critical care brands, Panimun Bioral, Mycept
and Pangraf are also the leading brands in
Supply of Kidney Transplant
•
Approval of Manufacturing facilities from
the Organ Transplantation segment but have
main regulatory agencies viz. German
a poor reflection in ORG IMS audit, as ORG
Regulatory Authority and ANVISA (Brazil),
IMS SSA audit does not track institutional
paving the way for entry into nearly US$
sales or Direct to patient sales.
600 million Nephrology space in the
15
The Company
is currently in
the process of
registering its
products in key
new markets
including US,
European Union,
Switzerland,
South Africa,
Turkey, Brazil,
Mexico,
Columbia,
Venezuela, Chile,
Philippines &
Malaysia.
represented markets. In addition, this
Pertusis (DTwP)-Hepatitis B), Easyfour
approval allows the Company an entry
(DTwP-Haemophilus Influenza type B (Hib))
into markets of CIS (Ukraine), Africa
and Easyfive (DTwP-Hepatitis B-Hib). The
(Tanzania, Ethiopia, Uganda) and Middle
Company has WHO pre-qualification for all
East (Syria).
these vaccines and is currently supplying oral
In its efforts to build brands, Panacea Biotec
has continued to chase its commitment
polio, Hepatitis B and Easyfive Vaccines to
UNICEF for their global requirements.
of working closely with the leading
The Company also received an award for
Nephrologists & Transplant Surgeons in
supply of Easyfive Vaccines from PAHO and
represented/planned markets. Due to
has initiated supplies of Easyfive vaccines
these efforts, the Company’s products are
during the current year.
being routinely procured & purchased by
the Ministries of Health in Asia (Sri Lanka,
Vietnam, Mongolia) and in CIS (Ukraine).
The vaccines, Ecovac4, Easyfour and Easyfive
are also being marketed in India through
its joint venture Company Chiron Panacea
The Company has initiated a series of
Vaccines Pvt. Ltd. (CPV). The Company
unique promotional activities in represented
has gained significant market share in the
markets; thereby re-affirming its credentials
combination vaccine segment in domestic
as a scientifically focused company. Some of
market.
them are “Free Blood level for patients taking
Tacrolimus (in Sri Lanka)” and “Bone Mineral
Density (BMD) estimation for patients to
detect & manage early onset of Osteoporosis
patients (in Sri Lanka & other markets)”.
In addition, the Company’s products are in
the advanced stage of registration in majority
of the potential markets viz: Latin America
(Brazil and other MERCOSUR markets), Africa
(South Africa, Nigeria, Kenya), Middle East
(Jordan, Egypt, Yemen) and Asia (Philippines,
Malaysia, Singapore). These commercial
realizations is expected to enable the
Company to register quantum increases in
the business outlook in the coming 2-3 years.
During the year, the Company has launched
PolProtec, an innovative injectable polio
vaccine, in the Indian market in pre-filled
syringe, NovoHib (monovalent Hib) vaccine
and PrimOpol, triavalent Oral Poliomyelitis
Vaccine in multi-dose through CPV.
As regards combination vaccines, developing
countries would need these vaccines to the
tune of around 300 million doses annually.
The combined demand of all combination
paediatric vaccines worldwide was valued at
US$ 600 million in 2005 and is estimated to
grow to US$ 1.6 billion by 2012. Pentavalent
vaccine market is estimated to cross a mark
of US$ 1 billion out of which UN agencies
are likely to procure this vaccine worth more
Vaccines
Panacea Biotec has an excellent portfolio
of innovative paediatric vaccines which
protect children against dreadful diseases
such as polio, hepatitis, diphtheria, tetanus,
pertusis & haemophilus influenza. The
portfolio of vaccines includes the Trivalent
Oral Polio Vaccine (tOPV), Monovalent
(Type I and Type III) Oral Polio Vaccine
(mOPV), Enivac HB (Hepatitis B) Vaccine
than US$ 350 million (around Rs.17 billion) by
2009 itself.
As regards Polio Vaccines, Panacea Biotec
has made dynamic progress in the field of
Polio protection with many new vaccines
coming into medical practice in recent times.
Under current circumstances, it is imperative
for the Company to be in harmony with
the Government’s policies & the medical
fraternity.
and innovative Combination Vaccines such
Hence, the Company has adopted a unique
as Ecovac4 (Diphtheria-Tetanus-wholecell
strategy which harness with the government
17
The Company
has launched
PolProtec, an
innovative
injectable polio
vaccine, in the
Indian market
in pre-filled
syringe, NovoHib
(monovalent
Hib) vaccine
and PrimOpol,
triavalent Oral
Poliomyelitis
Vaccine in multidose through
CPV.
in their fight against polio known as
liquid vaccine & WHO stated high priority
“Sequential dosing strategy”. This sequential
vaccine, Polprotec (enhanced Inactivated
dosing strategy is OPV followed by
Polio vaccine, eIPV) & NovoHib (Haemophilus
Inactivated Polio Vaccine (IPV). This strategy
influenzae type b conjugate - mono Hib
is intended to decrease the incidence of
vaccine), in the emerging markets in years to
Polio, while maintaining high levels of
come. The International Vaccines Business is
population immunity to poliomyelitis
well poised for a promising future ahead with
outbreaks. It is expected to remain until
a steady increase in preventive healthcare
further progress towards global eradication
spending.
is achieved.
International Vaccines Business
Logistics Network
Panacea Biotec has an advanced professional
Immunization has become one of the most
important & cost effective ways of reducing
child mortality. keeping this trend in mind,
Panacea Biotec has adopted a strategy by
the development of enhanced combination
vaccines; opening a whole new dimension
towards protecting multiple diseases with
just single injection.
logistics network throughout the country.
The company is poised to make inroads into
global Vaccine markets and has deployed
specialized team for its Vaccine Business in
emerging (ROW) markets.
Company through its efficient sales force
The Company has started establishing its
ground work in various potential vaccine
markets & also obtained registration in Nepal
& Pakistan.
expertise in cold chain management for
Panacea Biotec is all set to launch
GeneratioNext vaccines such as Easyfive - a
Boxes, Coolant, Cold Rooms and Refrigerated
WHO pre-qualified pentavalent vaccine,
remain safe and effective against changes in
which is also amongst the world’s first fully
the variant temperature conditions.
18
The Company has a nationwide sales and
marketing network covering approximately
450 districts in India and targets more than
1.1 million customers through a field force of
more than 1000 trained marketing and sales
professionals and 23 sales depots/carrying
and forwarding agents all over India. The
reaches more customers more effectively.
The Company has its Central Warehouse at
Delhi. Besides this the Company also has
storage and distribution of Vaccines under
monitored conditions using a system of
Vaccine Vial Monitors, Data Loggers, Ice
Vehicles. This ensures that the Vaccines
Manufacturing Facilities
Panacea Biotec has its manufacturing
facilities for vaccines and pharmaceutical
formulations in India in Delhi, at Lalru in
Punjab and at Baddi in Himachal Pradesh.
The Company is in the process of setting
up new manufacturing facilities for Cell
Culture based Vaccines in bulk form at Lalru,
which is expected to be completed in the
current financial year. The manufacturing
facilities have been set up in compliance with
international regulatory standards including
WHO-cGMP, US-FDA, European Union
and cell culture based biopharmaceutical
products following current Good
Manufacturing Practices (cGMPs) prescribed
by WHO and US FDA with an investment
of around Rs.1 billion. One of the suites will
cater to the biopharmaceutical / vaccine
on mammalian cell culture system with the
option of conventional as well as disposable
bioreactors. The second facility would be
multi-product facility for microbial products
and the third facility will be for viral vaccines.
The Company expects these facilities to be
commissioned in the current financial year.
standards for GMP and Good Laboratory
Two bulk vaccines manufactured at
Practices (GLP).
Company’s Lalru unit (Recombinant
The Company’s manufacturing expertise
lies in various solid, semi solid & liquid oral
dosage forms and vaccines such as:
•
Oral-solids - Conventional tablets/
capsules, Controlled/delayed release/
enteric coating tablets and capsules,
Tablet in Tablet, Tablet in Capsule, Multi
•
Hepatitis B Vaccine and Haemophilus
influenzae type b conjugate vaccine) are
WHO pre-qualified which are being used
for manufacture of innovative combination
vaccines for supply to UNICEF and PAHO.
Pharmaceutical Formulations facility at
Baddi
Layered Capsules, Hard gelatin/ Soft
The Company’s state of the art
Gelatin capsules, Mouth Dissolving/
pharmaceuticals formulations manufacturing
Chewable Tablets, Beads Encapsulation,
facility at Baddi, built in compliance with
Coating: film, sugar & functional, Taste
USFDA standards, received encouraging
masking and fast-dissolving tablets.
acclaim and numerous plant approvals from
Semi-solids - Ointments/Creams/Gels,
Transdermal Drug Delivery System.
various regulatory authorities. The facility is
now approved for Brazil as well as for several
other markets like Yemen, Syria, Ukraine
•
Liquids - Suspensions/Syrups/Solutions.
•
Vaccines - Recombinant Vaccines,
manufacturing facility is also approved for
Combination Vaccines and Cell culture
markets in European Union. The Company is
Vaccines and live vaccines.
expecting clearances from other regulatory
Manufacturing Facilities for Vaccine
Antigens at Lalru, Punjab
& Ethiopia. The Company’s soft gelatin
agencies like MCC South Africa and UK
MHRA in the current fiscal. The facility has
annual capacity for producing 900 million
The Company has three separate dedicated
tablets, 120 million hard gelatin capsules, 12
bulk vaccine manufacturing facilities for
million tubes and bottles each, 150 million
Recombinant, Bacterial and Tetanus Vaccines
soft gelatin capsules and 60 million herbal
at Lalru in Punjab. In addition to the existing
tablets.
bulk vaccine manufacturing facilities, the
Company is setting up one more state of the
Vaccines Formulation facility at Baddi
art bulk manufacturing facility comprising of
The Vaccine Formulation plant (VFP) at Baddi
three suites at Lalru in Punjab, which have
in Himachal Pradesh, has two filling lines for
been designed, constructed, adapted and
bacterial and viral vaccines complying with
maintained for production of bulk vaccines
WHO-cGMP norms for liquid Vaccines in pre-
19
The Company is
in the process of
setting up new
manufacturing
facilities for Cell
Culture based
Vaccines in bulk
form at Lalru,
which is expected
to be completed
in the current
financial year.
filled syringes, liquid & lyophilized Vaccines
WHO cGMP approved facility with WHO Pre-
in vials. The total production capacity of
qualification for Oral Polio and Recombinant
this facility is 600 million doses per annum
Hepatitis B Vaccine and combination
which is scheduled to be increased by the
vaccines Ecovac-4, Easyfour & Easyfive. The
addition of third line to one billion doses per
facility has been designed, constructed
annum by the end of current financial year.
and maintained to suit production of
This facility has increased the production
vaccines following Good Manufacturing
capacity of vaccines substantially in scale
Practices. It has three vial filling lines - two
and size. It would significantly improve our
lines dedicated to Oral Polio Vaccines
market presence globally and augment our
both Trivalent & Monovalent and one line
plans to become a global leader in this field.
dedicated to Hepatitis B & Combination
The three-storey main building consisting
Vaccines.
of production, quality control and quality
assurance departments is spread over
approx. 2800 M² construction area at each
Manufacturing Facility for Anti-Cancer
Products at Navi Mumbai
floor. The plant also has a five-storey block
The Company is setting up a manufacturing
of Warehouse-cum-Cold Storage facility
facility for anti-cancer products at Mahape,
admeasuring approx. 2500 M² on each floor.
Navi Mumbai. This manufacturing plant will
Vaccines Formulation facility in Delhi
Vaccines formulation facility in Delhi is a
Production facility at Baddi, Himachal Pradesh
have a state-of-the-art containment facilities
for clinical / commercial production of highend anti-cancer range of products.
Panacea Biotec has built a strong R&D
base over the last decade to support its
business segments, vaccines, formulations
and biopharmaceuticals. It has five highly
sophisticated ultra-modern R&D centers
Company has plans to further strengthen
the R&D base to cater to more profitable
and expanding niches in vaccine and
formulations segments, both in domestic as
well as international markets.
LAKSH Drug Discovery R&D Center at
with 391 employees including 261 qualified
Mohali in Punjab
and experienced scientists for its various
Laksh, the Company’s state-of-the art
research projects. The core area of research
Research Center for development of New
& development includes new Vaccine
Chemical Entities (small molecules) at
Development, Biopharmaceuticals, proteins,
Mohali, Punjab is spread over 70,000 sq.
peptides, monoclonal antibodies, Novel
ft. of Laboratory Space and employs more
Drug Delivery Systems projects, Advanced
than 70 scientists including 9 PhDs. Laksh
Drug Delivery System projects and Drug
has expertise to carry out work on different
Discovery (small molecules), in compliance
with international regulatory standards. All
the five R&D Centers have been accorded
registration by Department of Scientific and
Industrial Research, Ministry of Science &
Technology, New Delhi.
aspects of drug discovery which include
medicinal chemistry, in vitro and in vivo
biology, analytical & bio-analytical research,
pharmacokinetics and drug metabolism and
toxicology studies. The focus of research is
on development of NCEs for the treatment
As a result of its research efforts, the
of metabolic disorders, CNS and infectious
Company has been granted more than 300
diseases.
patents in India and worldwide including
Sampann R&D Center at Lalru in Punjab
major countries like U.S., Europe, Australia,
Canada, China, Japan, Russia etc.
The R&D Centre at Lalru named as SAMPANN
For carrying out pre-clinical research, the
Panacea Biotec’s Pentagon of R&D centers
Company has a state-of-the-art animal house
and facilities for undertaking in-vitro and
in-vivo microbiology, pharmacology, safety,
efficacy, proof of concept and toxicology
studies.
Drug Delivery is one of the major part of
which spread across 40,000 sq. ft. of
laboratory space with superior infrastructure,
specialized machinery, adequate resources
and skilled manpower to conduct research
in the areas of Formulation Development,
The Company has been steadily increasing
Novel Drug Delivery, Pharmacology,
its expenditure on R&D, both revenue and
Analytical Chemistry, Medicinal Chemistry
capital expenditure, and has spent Rs.500.9
and Natural Products. The said research
million (6.5% of net turnover) in fiscal 2009,
facility also boasts of an in-house IPR
as compared to Rs.410.5 million (4.9% of net
Management Department and Information
turnover) in fiscal 2008, an increase of around
Science Department.
22% in value terms. Further, the Company
has also invested an amount of Rs.578.42
million as capital expenditure on R&D as
compared to Rs.666.2 million in previous
year.
The primary focus of the Sampann Drug
Delivery is to develop value added drug
delivery products that would address unmet
medical needs, focus on patient convenience
and compliance, augment the intellectual
The total R&D Expenditure has been
capital and contribute towards achieving
Rs.1,079.3 million (14.0% of net turnover)
the organizational business goals. A large
as against Rs.1,076.7 million (13.0% of the
number of high potential drug delivery
net turnover) in previous financial year. The
based projects have been selected for
21
The Company
has been granted
more than 300
patents in India
and worldwide
including major
countries like
U.S., Europe,
Australia,
Canada, China,
Japan, Russia etc.
development based on highly specialized
space has been established with an objective
drug delivery technologies including Site
to develop novel, effective and affordable
Specific Drug Delivery, Topical System, Depot
vaccines against various epidemic /endemic
Injectable Preparations, Nanoparticulate
life threatening diseases for global market.
Drug Delivery, Pulmonary Drug Delivery
SVRC has the infrastructure and expertise
and Oral Controlled Release Systems. These
to take an ‘idea’ through different stages of
projects are targeted towards both the
product development towards a successful
domestic and global markets. In addition
commercialization. In view of company’s
to above mentioned differentiated drug
strategy for expanding its scientific strength
delivery systems, biopharmaceutical product
to innovate more vaccines, this center is
development to deliver stable and robust
carrying out extensive research in vaccines
formulations, has been initiated.
and biologicals using genetic engineering,
In year 2008-09, Product development
animal cell culture, fermentation,
has been done for different categories of
purification, serology, analytical and bio-
drugs which include Anti-inflammatory,
analytical development.
Anti-allergics, Anti-tubercular, Antihaemmorrhoidal, Anti-emetics,
Anti-psychotics, Anti-bacterials, Antihypertensives, Anti-depressants,
Specific areas in which Research &
Development being carried out include:
•
Development of conjugate vaccine
Immunosuppressants, Anti-arrhythmics, Anti-
against Streptococcus pneumoniae and
retrovirals, Anti-diabetics etc. and various
Neisseria meningitides
combinations thereof the above category of
drugs.
Saha Vaccine Research Center in Delhi
•
Development of a novel recombinant
protein based vaccine for Anthrax
•
Development of Vero cell derived
The Saha Vaccine Research Center (SVRC) in
inactivated Japanese encephalitis vaccine
Delhi, spread across 24,000 Sq ft of laboratory
using animal component free media
GRAND R&D Center at Navi Mumbai
This R&D Centre is inter-alia, focused in
•
respect of:
•
several biosimilars. The technology for
one of the biosimilar molecule is ready
Development and improvement in
for transfer to the production unit.
existing conjugation technology for
Several in vitro assays for determining
better yield and clinical application.
•
various biosimilars have been developed
vaccine to US FDA for initiation of clinical
and validated.
based on quality and pricing.
•
bioactivity, binding and functionalities of
IND submission for recombinant Anthrax
trials for providing a competitive edge
•
Generation of recombinant clones for
•
In an attempt to develop vaccine to
control Dengue virus infection, a suitable
Further development of recombinant,
cell line for the assay and amplification
polysaccharide conjugate and cell culture
technology of recombinant chimeric
based vaccines. The candidate vaccines
Dengue virus has been prepared.
would be taken forward for scale up,
Appropriate Dengue viruses have been
followed by pre-clinical and clinical
amplified and immunogenicity of the
studies.
candidate virus has been planned.
Initiating the development of vaccine for
•
A unique recombinant inactivated H5N1
pertussis using a genetically modified
candidate vaccine has been designed.
strain of B. pertussis.
The immunogenicity of this candidate
Biopharmaceutical R&D Center in Delhi
The Biopharmaceutical R&D center (BRC) has
has shown promising results.
•
for fully human monoclonal antibodies,
around 40 scientists working in the area of
a library of human antibodies has been
molecular biology, cell biology, immunology
developed. The library is being screened
and peptides. The centre has been working
on different discovery and developmental
projects. Development of novel preventive
& therapeutic vaccines, novel therapeutic
peptides and therapeutic fully human
monoclonal antibodies for treating infectious
diseases and life style related disorders are
the focus of discovery projects. BRC is also
actively involved in developing different
biosimilar products.
In order to identify appropriate clone
against various targets.
Further, responding to the threat of
widespread deadly disease of swine flu,
the Center has expedited development of
candidate vaccine for H1N1 swine flu.
GRAND R&D Center at Navi Mumbai
Global Research and Development (GRAND)
Center at Mahape, Navi Mumbai which
was inaugurated in February, 2008, is fully
During the year 2008-09 the centre has made
functional. There is a team of around 50
significant progress in the following fields:
highly skilled and committed research
•
Optimisation of the process for the scaleup production of hair growth peptide,
a technology for alopecia (hair loss)
management in-licensed from National
Institute of Health, USA. A pre-clinical
toxicological study has been planned.
•
scientists working relentlessly to discover
better therapeutic alternates for unmet
medical needs of the society. Broadly,
the Center is working on drug delivery
technologies based on:
•
delivery and reduced side effect with
Identification of a novel peptide for the
improved bioavailability
treatment of Rheumatoid Arthritis. Proof
of concept has been established. The
23
Nano-particle systems for targeted
•
Microparticulate systems for depot
synthetic process for this molecule has
injections with reduced frequency of
been developed and optimized.
dosing
Responding
to the threat
of widespread
deadly disease
of swine flu,
the Center
has expedited
development
of candidate
vaccine for H1N1
swine flu.
•
Micellar systems for bioactive targeting
and bioavailability enhancement,
specially for cancer targeted drug
delivery
•
•
Quality is among the most important reasons
to persuade a customer to buy a product.
Total Quality Management has always been
Stealth liposomes for prolonged systemic
the cornerstone of your Company which has
circulation to achieve better therapeutic
resulted in achieving greater milestones in
effects
the past couple of years. At Panacea Biotec,
Controlled drug delivery for oral
application by utilizing the concept of
Gastroretentive systems, zero order
release systems and site specific delivery
system in gastrointestinal tract
•
Quality Assurance
Nanoparticle for topical delivery with
better patient compliance and reduced
frequency of application
Few concepts based on above mentioned
technology platforms have cleared proof
Quality is in-built in products & services and it
is integrated in each step of R&D, Production,
Packaging, Storage, Marketing, Sales &
Distribution. Your Company is committed to
adhere to the highest quality standards for
products it manufactures and is ensuring this
through a highly qualified, techno-innovative
& dedicated team.
Clinical Research Operations
of concept studies and are entering clinical
Clinical Research plays a pivotal role in
trials. Center has emerged as a strong
the drug development process. Clinical
intellectual property earning member of
development establishes the safety and
Panacea Biotec family with many patent
efficacy of a new drug product involving
filings last year and few are in process.
significant expertise, time and investment.
The Company also successfully completed
applications relating to various drug delivery
clinical part of trial of bOPV, aimed towards
technologies, synthetic processes, new
the planned application for WHO pre-
chemical entities, improved chemical entities,
qualification.
vaccines, pharmaceutical compositions and
The year 2008-09 witnessed several
milestone achievements for Clinical Research
Operations of the Company, including:
•
a large randomized controlled trial
in ~1,800 subjects across 40 centers
for a novel drug delivery product for
osteoarthritis;
•
a multinational trial, spread across two
geographical regions (Asia/EU) & three
countries (India/Germany/Poland) for a
GI product;
•
natural product compositions out of which
11 applications were filed through the PCT
route.
Till date Panacea Biotec has been granted
10 patents in India and 26 product
patents worldwide for different products/
technologies during the year under review
Some of the key patents granted to Panacea
Biotec during the fiscal 2009 are: Euphorbia
Prostrata (Thank OD & Sitcom) granted in
India, Mexico, New Zealand, South Africa &
USA; Nimesulide Controlled Release (Willgo)
a long duration trial with a 2-year follow-
granted in Indonesia & Israel; Domperidone &
up to evaluate the relapse rate 24 months
Pantoprazole Combination (OD-PEP) granted
after the completion of therapy for an
in New Zealand & South Africa; Nimesulide
anti-infective product;
Gel (Nimulid Transgel) two patents granted
Panacea Biotec is the first Indian
in India & one in Kenya; Nimesulide Injection
pharmaceutical company to indigenously
(Nimulid Safeinject) granted in India;
implement the Oracle Remote Data Capture
Amoxicillin (Modified Release) granted
(RDC) enabling it to conduct e-clinical trials.
in Australia & South Africa; Nimesulide
Effervescent Tablets granted in India; and
Paclitaxel granted in Morocco.
Intellectual Property
Besides this, the Company had filed
Panacea Biotec has its full fledged Intellectual
123 applications for the registration of
Property Rights department which manages
Copyrights (41 applications in 2008-09)
all the Intellectual Property from inception to
of which 80 had been granted. So far the
enforcement.
company has filed over 566 applications for
As at the end of fiscal 2009, the Company
has filed over 1,150 patent applications
worldwide including 189 Indian patent
applications and 67 applications have been
filed through the PCT (Patent Cooperation
Treaty) route.
registration of Trade Marks (25 applications
in 2008-09) of which 273 have been
registered. In addition to this, the Company
has also filed 55 International Trade Mark
Applications in various countries of which 24
have been granted. The company has so far
filed 4 Design Applications (1 application in
Out of the total number of patent
2008-09) and 3 of them have already been
applications filed, 325 patents had been
registered.
granted / accepted for grant. Apart from
this, the Company had in-licensed several
patent applications, some of which are under
prosecution in different countries of the
world.
Human Resources
Human Resources have been a strategic
partner in the organization in its endeavour
During fiscal 2009, the Company had
to lead market with its differentiated
filed 17 new Provisional Indian patent
products. Human resources have been taking
25
The Company
has filed over
1,150 patent
applications
worldwide
including 189
Indian patent
applications and
67 applications
have been filed
through the
PCT (Patent
Cooperation
Treaty) route.
Scientists in a brainstorming session at Sampann, Lalru
up challenges and initiatives for bringing in a
in support functions. Panacea Biotec’s
remarkable change in its mode of operation
human capital constitutes a diverse pool of
and decision making and to bring in a new
knowledge & expertise, a judicious blend of
paradigm to ensure a hassle free transaction
youth, imagination, risk-taking ability and
of HR services. Along with this, the Company
experience. The Company enjoys excellent
took great strides in strengthening
industrial relations and there have been no
connectivity with all the cross section of
work disruptions, strikes, lock-outs or other
employee.
employee unrest.
The Company has 3,196 permanent
In order to make its human capital as the
employees which include corporate and
differentiator for its long term business
managerial staff, sales staff and staff located
objectives, your Company has embarked
at its manufacturing facilities. Of these
upon number of initiatives, including:
permanent employees, 391 are engaged
in R&D Centers, 1,006 are engaged in
manufacturing, around 1,213 are engaged
2,773
2,821
3,196
in sales and marketing and rest are engaged
2,220
1,006
1,213
1,200
1,220
1,029
612
Projects was created and shown to all the
employees at all locations, followed by our
corporate Anthem.
2007-08
Sales
Manpower Strength
391
393
350
319
where all employees of the Company at all
locations were involved. A video recording of
and Mr. Sumit Jain, Director-Operations &
1,318
1,105
2,162
1,105
September with a new innovative turn,
warm and inspiring messages voiced by
661
236
Day Celebrations were organised on 25th
Dr. Rajesh Jain, Joint Managing Director
2004-05
2005-06
2006-07
R&D
Manufacturing
26
Annual Day Celebration: 13th Annual
2008-09
Total
The audio-video presentation was followed
by the awe-inspiring performances of our
employees made the day all the more
which successfully promotes the
concept of having a paperless HR
in the years to come.
Baddi Housing: To bring in a
healthy work/life balance for
employees of the Company at
Baddi and to provide employees
with quality accommodation in
areas where there is a shortfall
of rented accommodation, the
colorful and memorable across locations to
celebrate the “Spirit of Togetherness”. With
enthusiastic participation, the Annual Day
was a great success.
Company Newsletter: A quarterly Company
Newsletter has been launched with the
main objective to internally connect the
employees which can ignite the true spirit of
togetherness and bring in a sense of pride for
our achievements.
Company has come up with its
own housing of 80 residential
flats with all modern amenities at moderate
rentals for its employees.
Learning and Performance management:
Continuous development of its human
resources has always been the focus of the
Company. Panacea Biotec continuously
strives to provides seminars and training
programs to meets of employees. Proper
training schedule was formed up during
HR Buddy: HR4U to help employees with an
the year including Creativity Retreat, People
instant answer to their ‘pain area’, an email
Leadership, Zero Defect and Cost Reduction
based employee connect initiative has been
to name a few. The leadership team of
rolled out this year. The ‘HR4U’ mailbox is
Panacea Biotec underwent a 3-day workshop
an efficient and friendly channel to answer
on the ‘7 Habits of Highly Effective People’
every query within a short span of time by
as part of their Leadership Development
the HR Buddy.
Programme.
HR SAP Blitz - Go Live and ESS Online:
Information Technology
Going Live on HR SAP across all business
function was a
As a research based organization, your
major success
during the year.
It has helped
the Company in
way of having
a time effective
and cost effective
operational
process in HR.
The launch of ESS
has curtailed the
manual processes
and has taken
the Company
to an improved
information edge
27
Company believes in accelerating value
individual health record with investigations,
realization and delivering operational
diet, exercise, yoga & medication; knowledge
efficiencies in healthcare. Panacea Biotec has
base of Holistic healing with focus on
been continuously investing in information
Ayurveda, Homeopathy & Yoga apart
technology to enhance communication
from Allopathy; Health Calculators & ready
facilities with a view to provide a strong
reckoners; Path finders to various common
knowledge base to its employees, enable
illnesses and disease; Comprehensive health
faster scanning & monitoring of external
information with focus on children & elderly;
environment and improve the knowledge
and Neighborhood Resources for doctors,
of best practices and relevant leading-edge
labs, chemists etc.
technologies.
Medical practitioners, including creation
and leveraging of technology initiatives
of their own Information & Resource
to improve the efficiency of various
Centre; tools to create and maintain patient
departments, your Company has already
records & interact with them online; latest
implemented System Analysis and Product
information on diseases & therapeutic areas
in Data Processing (SAP) covering Financial
of their interest; attend Continuing Medical
Accounting, Controlling, Asset Management,
Education (CME) programs online and in
Materials Management, Production Planning
person; interface with peers and specialists
and Sales Distribution. SAP HR Module
from related fields online; explore placement
has also been successfully implemented.
opportunities; opportunities for participation
Implementation of some other modules
in clinical trials; and holding patient/public
like Project Systems, Plant Maintenance,
awareness programs.
Business process consolidation & Strategy
management are in pipeline.
The Company’s
health portal
“www.
bestonhealth.
com” provides
comprehensive
health related
information
& services to
common man
& medical
practitioners and
offers a unique
interactive
‘Individualized
Health
Management
plan’.
It also offers unique interactive facility for
As an effort towards implementation
As a member of BestOnHealth.com portal,
one can also order disease-specific patient
The Company has also adopted Oracle
education corners and regular supply of
clinical trial software and SAS analysis tool
offline material like brochures, leaflets,
to manage, standardize and control clinical
booklets etc. and can also keep a track
data for fast study set-up and consistent
of events and appointments through
interpretation of data in compliance with
interactive reminder service.
regulatory requirements.
Microsoft Exchange and Share point
portal solution is available for messaging
& collaboration, addressing the internal
& external communication and workflow
needs. The Company’s sales depots &
manufacturing facilities are well connected
through secure and robust Virtual Private
Network (VPN)
BestOnHealth Portal: The Company’s health
portal “www.bestonhealth.com”, developed
and launched in the year 2002 with an
objective to provide comprehensive health
related information & services to common
man & medical practitioners.
For Patients & Healthy individuals, this portal
is one of a kind, individualized management
tool in investigation, medication, diet,
exercise, yoga. It offers information on
customized diets that compliment health as
well as the taste buds; different treatment
options and new diagnostic techniques;
specific information about investigations,
preparation required before hand and what
the test reports mean.
This Portal also provide a customized,
disease-specific bi-monthly newsletters
providing contemporary knowledge about
diseases & their treatment; information on
novel researches & seminars; information
It offers a unique interactive ‘Individualized
about the “BestOnHealth” patient education
Health Management plan’ which links
programs; schedulers to remind about daily
28
or important events; and interactive exercise
•
& yoga plans.
content they wanted to put about
themselves; and
The portal also provides an interactive
Address book to keep track of contacts and
a common platform to share experiences in
To show doctors achievement & the
•
To be the online interface of the
Company’s upcoming healthcare facility.
tackling disease with other patient groups.
The portal is becoming widely popular
and is being regularly accessed by healthy
individuals, patients & medical practitioners
from all across the globe. During last 4
months, the average number of hits (attempt
to access the site) is around 3000/day. The
number of visitors who read the contents is
more than 300/day. The visitors are coming
from various parts of the world, including
40% from US, 23% from India, 17% from
China and rest from UK, Korea, Japan,
Sweden, Singapore, France, Canada, etc. A
significant percentage of visitors are Medical
practitioners.
Future Perspectives: It will continue to
address the needs of medical fraternity
& patients and be an excellent source
of patient education and furthering the
ultimate objective of a healthy world. The
Company has planned to enhance the
coverage of the health portal in current
financial year and expects the portal:
•
To add value to Panacea Biotec’s
perception amongst doctors as a leading
health management company;
•
•
•
•
29
The Company believes that its internal
control systems and procedures are
in line with its size of operations and
provide, among other things, a reasonable
assurance that transactions are executed
with Management authorization and they
are recorded in all material respects to
permit preparation of financial statements
in conformity with established accounting
principles and that the assets of your
Company are adequately safeguarded
against significant misuse or loss. The
internal control systems are supplemented
through an extensive internal audit
programme and periodic review by Audit
Committee.
M/s. Dass Gupta & Associates, Chartered
Accountants, M/s. S.K. Badjatya & Co.,
Chartered Accountants and M/s. K.K. Garg
& Associates, Chartered Accountants,
continue to act as the Internal Auditors
of the Company. The internal auditors
independently evaluate adequacy of
internal controls and audit the majority of
To benefit doctors to enhance their
the transactions in value terms. Post audit
practice with IT enabled services & form
reviews are carried out to ensure that audit
closer ties with our organization
recommendations have been implemented.
To publish medical practitioner’s articles,
The Audit Committee of the Board of
quotes, photos in the portal periodically;
Directors comprising of three non-
Information sharing regarding various
executive independent Directors viz.
healthcare/ medical conferences/
Mr. R.L. Narasimhan, Mr. N.N. Khamitkar
exhibits calendar based;
and Mr. Sunil Kapoor, reviews Internal Audit
To show patient’s opinion about the
doctors;
•
Internal Audit and Control
Reports and the adequacy of the Internal
Controls. The Auditors, Joint Managing
Director, Associate Director, Chief Financial
To include Specialty & city-wise contact
Officer, D.G.M. (Accounts & Finance) and
details database of our member medical
other senior officials are invited to attend the
practitioners;
Audit Committee Meetings.
The number of
visitors who read
the content of
health portal is
more then 300/
day. The visitors
are coming from
various parts
of the world,
including 40%
from US, 23%
from India, 17%
from China
and rest from
UK, Korea,
Japan, Sweden,
Singapore,
France, Canada,
etc.
Subsidiaries, Joint Ventures,
Collaborations & Tie-ups
Subsidiaries
Best On Health Limited - The Company’s
wholly-owned subsidiary (WOS) namely
Best On Health Ltd. (“BOH”), which owns
a prime immovable property being used
by the Company as its Corporate Office,
has charted out a plan for diversification in
related health management space as part
Company has remitted an amount of Rs.2.4
million (US$ 50,000) as a capital contribution,
during the current financial year.
Panacea Biotec FZE – This WOS was
incorporated in UAE to perform the activities
relating to registration and marketing of the
Company’s patented products worldwide
and an amount of Rs.5.5 million (AED
500,000) had been remitted towards its
capital contribution.
of its future growth plans. The Company
Panacea Biotec GmbH - During the year
has so far invested Rs.2,013.9 million in BOH
under review, your Company had remitted
including Rs.1,991 million as 0.5% optionally
an amount of Rs.1.6 million (Euro 25,000) for
convertible Non Cumulative Preference
setting-up WOS in Germany, namely Panacea
Shares to finance its foray into healthcare
Biotec GmbH, with a view to perform
industry. BOH has four WOS namely Radicura
activities relating to registration of the
& Co. Ltd, Panacea Hospitality Services Pvt
Company’s products in European Union.
Ltd., Sunanda Steel Company Ltd & Panacea
Rees Investments Limited – It has been
Educational Institute Pvt. Ltd.
set-up as a Company’s WOS in Islands
Umkal Medical Institute Pvt. Ltd. - The
of Guernsey with its main objects of
Company is expanding its portfolio by
manufacture, marketing and/or import/
entering the fast growing healthcare
export of pharmaceutical formulations,
sector and has entered into collaboration
vaccines and other products, making
with Umkal Group to set-up a multi
strategic investments in other entities,
super-specialty hospital with the modern
entering into joint venture and
equipments in the NCR of Delhi at Gurgaon.
collaborations and/or for carrying out such
With your Company’s leadership in
other permissible activities. The Company
providing innovative medical therapies and
has given a loan of Rs.710.8 million (US$ 14
Umkal’s long term experience in providing
million) to it. Rees Investments has further
specialized healthcare, the collaboration
established its WOS company namely,
would be unique and one of its kind. Your
Kelisia Holdings Limited, Cyprus whose
Company has invested an amount of
principal activity is holding of Investments.
Rs.76.14 million for acquiring 75.2% stake
Kelisia Investment Holding AG and Panacea
(27% paid-up) in Umkal Medical Institute
Biotec (International) SA had been set-up in
Private Limited, during the year under
Switzerland as step-down WOS companies
review. Further, during the current fiscal, the
of Rees Investments Ltd., with the purpose of
Company has also paid second call money of
carrying out investment activity as well as to
Rs.24.0 million (representing 8.5% payment).
engage in all other related activities.
Panacea Biotec Inc. - During the year under
During the year, Kelisia Holdings Ltd.
review, the Company has incorporated a
has made a strategic equity investment
wholly owned subsidiary (WOS), Panacea
of US$13.1 million in PharmAthene, Inc.,
Biotec Inc. in US with its main objects
Annapolis, MD, US, a biodefense company
of, inter-alia, research, development,
developing medical countermeasures
manufacture, register, market, distribute,
against biological and chemical threats, in
import and export pharmaceutical and
exchange for the purchase of common stock
biological products etc. in United States. The
and warrants in PharmAthene.
31
The Company
is expanding
its portfolio by
entering the
fast growing
healthcare
sector and has
entered into
collaboration
with Umkal
Group to set-up
a multi superspecialty hospital
with the modern
equipments in
the NCR of Delhi
at Gurgaon.
Joint Ventures & Associates
Panacea Biotec has the following Joint
Venture and Associate Companies:
by your Company. PanEra has become
a specialized company focused on bulk
manufacture of vaccines and plans to
venture into new products and technologies.
Chiron Panacea Vaccines Pvt. Ltd. - Your
It has also launched its web-site namely
Company’s Joint Venture Company (JV
www.panerabiotec.com.
Company), Chiron Panacea Vaccines Pvt. Ltd.
(“CPV”), was incorporated in fiscal 2005 in
India with Chiron Vaccines Holding Srl., Italy
(now Novartis Vaccines and Diagnostics),
a division of Novartis, world’s fifth largest
vaccines manufacturer, for marketing of
innovative combination and other vaccines
in India. The Company has invested Rs.23.0
million in CPV for a 50% equity stake. With
the launch of Hepatitis A vaccine HAVpur,
a new generation vaccine with virosome
technology in collaboration with Berna
Lakshmi & Manager Holdings Limited
- During the year under review, the
Company’s associate firm, viz. M/s Lakshmi
& The Manager, in which the Company
had invested Rs.40.0 million (40% share),
has been taken over by a newly formed
company, Lakshmi & Manager Holdings
Limited. As a result of takeover of the said
firm, the Company has been allotted Equity
Shares for an amount of Rs.41.26 million in
the said company.
Biotech Ltd., Switzerland and the Company’s
Injectable Polio Vaccine (PolProtec),
monohib vaccine (novoHib), Triavalent Oral
Collaborations and Tie-ups
Poliomyelitis Vaccine (PrimOpol) in the
Apart from the above, Panacea Biotec has
Indian market, CPV has a strong portfolio of
important business relationships with various
innovative paediatric vaccines, which in short
research institutes, academic universities &
span has taken significant position at market
commercial corporations, including:
place. CPV achieved a turnover of Rs.538.4
National Institute of Immunology, India:
million and net profit of Rs.41.6 million
The Company has an exclusive ten-year
during the year under review and commands
a significant market share in the paediatric
combination vaccines segment in India. It has
introduced innovative concepts like Peel off
stickers, Easy Track SMS service and Pre-filled
Syringes with Plastic Rigid Tip Cap.
license agreement with National Institute
of Immunology, India for in-licensing of
technology and processes for production of
tissue culture derived formalin inactivated,
Japanese encephalitis vaccine. The
technology has been further modified
Cambridge Biostability Ltd. - The Company’s
significantly at our research center to yield a
another JV Company, Cambridge Biostability
commercially viable and safer vaccine.
Ltd. (CBL), a U.K. based Company, in which
Biotech Consortium India Ltd.: The Company
the Company acquired 10% stake and also
given a convertible loan of £ 1.5 million
during earlier years, has gone into creditors’
voluntary liquidation proceedings due to its
adverse financial position.
has a ten-year in-licensing arrangement
with Biotech Consortium India Ltd. for the
development, manufacture and marketing
of anthrax vaccine developed by Jawahar Lal
Nehru University, India. Phase I/IIa of human
PanEra Biotec Private Limited - Your
trials have been successfully completed
Company’s associate Company, PanEra
and the Phase-IIb clinical trials are to begin
Biotec Pvt. Ltd. (PanEra) is continuing to
shortly, subsequent to which the company
meet the Company’s requirement of bulk
plan to make IND submission to US FDA for
vaccines and antigens for the manufacture
initiation of clinical trials in US and supply the
of Hepatitis B and Combination Vaccines
anthrax vaccine to the U.S. Government.
32
National Institutes of Health (NIH), USA.: The
National Research Development Corporation
Company has an in-licensing arrangement
(NRDC), India: The Company had in-licensing
with NIH, USA, for use of a peptide based
arrangement with NRDC for manufacturing
product for generation of hair follicles
the Foot and Mouth Disease (FMD) Vaccine
and hair growth for alopecia (hair loss)
developed by Indian veterinary Research
management. Process for the scale-up
Institute (IVRI).
production of hair growth peptide has been
optimized. A pre-clinical toxicological study
has been planned.
Dr. Reddy’s Laboratories Ltd.: The Company
has a License and Supply Agreement with
Dr. Reddy’s for the supply of its patented
product, Nimesulide Injection, for marketing
in India. The Company has another License
PT BioFarma, Indonesia : The Company has
an agreement with PT BioFarma, Indonesia to
manufacture & market the Measles Vaccine
and plans to supply the vaccine to UNICEF,
PAHO and CIS, African, LATAM and Asian
Countries in furtherance to Global Measles
Reduction Strategy of WHO and UNICEF.
and Supply Agreement with Dr. Reddy’s
Punjab University, Chandigarh: The
for another patented product, Nimesulide
Company has a MoU with Punjab University,
Transdermal Gel, for marketing, distribution
Chandigarh for a Drug Discovery Project
and sale in Russian Federation.
to identify lead molecules with an aim to
Nederlands Vaccine Institute (NVI),
bring a New Chemical Entity (NCE) superior
Netherlands: The Company has an
to existing marketed products in the
agreement with NVI for manufacturing
therapeutic area of Psychiatric Disorders.
and marketing of Inactivated Polio Vaccine
Panacea Biotec will undertake their pre-
(PolProtec) in global markets except
clinical and clinical development leading to
Netherlands, Denmark, Norway and Finland.
their launch worldwide.
Dr. Rajesh Jain, Mr. Vinod Goel, Mr. Ankesh Jain (4th, 7th & 8th from left) with European Partners and competency team
(from Left to Right) Dr. Konstanze Kral, Dr. Wolfgang Klotz, Mr. Gerd-Peter Heberling, Mr. Hartmurt Bannert,
Mr. Klaus Manlik and Dr. Bernd G. Ruttger, during a recent meeting in Munich, Germany
33
Investments: The investments have increased
to Rs.2,165.7 million from Rs 2,049.3 million
Summarised Balance Sheet
Particulars
as at the end of previous year primarily on
(Rs. in million)
account of investment of Rs.200.0 million
As on
As on
31.03.09 31.03.08
in its WOS Best on Health Ltd. and Rs.76.1
Sources of Funds:
Institute Pvt. Ltd. to finance its foray in
Shareholders Funds
6,151.5 6,972.1
healthcare industry. Further, a provision
Loan Funds
7,002.9 3,982.4
on account of permanent diminution in
Total Liabilities
333.8
595.0
13,488.2 11,549.5
Application of Funds:
Net Fixed Assets
6,938.7 5,343.7
Investments
2,165.7 2,049.3
FCMITDA† Net Current Assets
Miscellaneous Expenditure
Total Assets
96.0
-
4,284.2 4,151.2
3.6
5.3
13,488.2 11,549.5
Foreign Currency Monetary Item Translation Difference Account
†
Net Worth: The Net Worth of your Company
is Rs. 6,147.9 million during the year under
review as compared to Rs.6,966.7 million as
at the end of previous year.
The net fixed
assets have
grown to
Rs.6,938.7 million
as against
Rs.5,343.7 million
as at the end of
the previous year.
million in its subsidiary Umkal Medical
value of investment of Rs.168.1 million in
the Company’s joint venture Cambridge
Biostability Ltd. was made during the year.
Net Current Assets: The Company’s net
current assets have improved to Rs.4,284.2
million as against Rs.4,151.2 million as at
the end of previous financial year. The
inventories have increased to Rs.4,478.0
million from Rs.2,116.4 million and the
inventories to net turnover ratio increased to
58% from 25% during previous year mainly
on account of postponement of deliveries
of finished products and purchase of raw
materials as per commitments in the existing
agreements. The receivables decreased
to Rs.1,238.8 million as against Rs.1,482.6
Loan Funds: The total loan funds as at 31st
million as at the end of previous financial
March, 2009, has increased to Rs.7,002.9
year and the receivables to net turnover ratio
million as against Rs.3,982.4 million as a
decreased to 16% from 18% during previous
result of raising of Foreign Currency Term
year. The Cash and bank balances declined to
Loans to part finance its expansion projects
Rs.594.8 million as against Rs.1,411.8 million
including setting up of manufacturing
as at the end of previous financial year. Other
facilities at Baddi & Lalru and R&D Center at
current assets increased to Rs.1,358.2 million
Mumbai and other ongoing expansion/ New
as against Rs.434.1 million due to advances
projects.
of Rs.710.8 million to the Company’s WOS,
Deferred Tax Liability: The deferred tax
Rees Investments Ltd. and advances of
liability has decreased to Rs.333.8 million
Rs.108.8 million to the Company’s Joint
as at the end of fiscal 2009 as compared to
Venture, CBL as against Rs. Nil and Rs.39.78
Rs.595.0 million as at the end of the previous
million respectively as at the end of the
year.
previous year.
Fixed Assets: The net fixed assets have grown
The current liabilities increased to Rs.1,528.1
to Rs.6,938.7 million as against Rs.5,343.7
million as compared to Rs.1,078.0 million
million as at the end of the previous year on
as at the end of previous financial year.
account of capital expenditure on ongoing
Increase in current liabilities is mainly on
expansion/ new projects and capitalization
account of increase in amount payable
of forex exchange losses as per option given
to vendors for vaccines raw material. The
by the Companies (Accounting Standards)
Provisions increased to Rs.1,857.5 million as
Amendment Rules, 2009.
against Rs.215.8 million mainly on account
34
of increase in provision for Open Derivative
Contracts to Rs.1,743.1 million as compared
to Rs.40.5 million as at the end of previous
Pharmaceutical formulation products.
Segment-wise Turnover
Fiscal
financial year.
Summarised Profit & Loss Account
(Rs. in million)
Particulars
Gross Turnover
Less : Excise Duty
2009
Rs. Million
2008
% Rs. Million
%
Vaccines
5,470.17
70.7
6,324.5
76.1
Pharmaceutical
Formulations*
2,262.30
29.2
1,976.0
23.8
3.9
0.1
Research &
Development
1.7
0.1
7,734.17
100.0
As on
31.03.09
As on
31.03.08
7,753.0
8,342.2
* Net of excise duty of Rs.18.8 million and Rs.37.8 million
18.8
37.8
during fiscal 2009 & 2008, respectively.
Total
8,304.4 100.0
Net Turnover
7,734.2
8,304.4
Materials & Finished Goods Purchases
2,660.9
3,658.4
Operating & Other Expenses
806.4
705.0
Personnel Expenses
916.1
924.9
Selling & Distribution Expenses
434.5
451.1
turnover, as compared to Rs.6,324.5 million or
Research & Development Expenses
(Excl. Depreciation)
500.9
410.5
76.1% of net turnover for fiscal 2008.
1.7
1.7
Earnings Before Interest, Depreciation,
Taxes & Amortization (EBITDA)
2,444.6
2,177.6
Foreign Exchange Fluctuation
2,260.4
40.5
The vaccine sales to JV company for domestic
Financial Expenses
347.4
150.1
market increased by 11.4% to Rs.243.3 million
Depreciation
705.1
430.0
as against Rs.218.3 million during fiscal 2008.
Other Income
259.7
371.7
Provision for impairment
284.2
-
Profit/ (Loss) Before Tax (PBT)
(923.7)
1,903.9
Provision for Taxes – current -
330.0
Provision for Taxes – deferred
(261.2)
211.2
28.0
31.0
(690.5)
1,331.7
Misc. Expenses
Provision for FBT
Profit/ (Loss) After Tax (PAT)
Vaccines
In fiscal 2009, the vaccines segment’s turnover
contributed Rs.5,470.2 or 70.7% of net
The institutional vaccine business contributed
Rs.5,186.9 million as against Rs.6,106.3 million
during the fiscal 2008.
Despite having pricing pressure from entry of
generic players, the JV company continued to
grow and maintained leadership position in
the paediatric combination vaccine segment.
Pharmaceutical formulations
The pharmaceutical formulations segment’s
Turnover: The Company has achieved net
turnover grew by 14% and contributed
turnover of Rs.7,734.2 million during financial
Rs.2,262.3 million or 29.2% of net turnover
year 2008-09 as compared to Rs.8,304.4
during fiscal 2009, as compared to Rs.1,976.0
million during financial year 2007-08.
million or 23.8% of the net turnover for fiscal
The decline in Net Turnover is mainly on
2008.
account of lower sales of vaccines due
In the Pharmaceutical Formulations segment
to postponement of supplies to UNICEF,
the domestic net turnover increased by
which is down by 15% as compared to
10.7% to Rs.1,815.3 million during fiscal 2009
previous year, whereas overall decline in Net
from Rs.1,639.5 million during fiscal 2008.
Turnover is by 7% as compared to previous
year. Balance growth comes from Pharma
segment. In other words, the Company’s
dependence on vaccines in general and
oral polio vaccine in particular is gradually
The export turnover of formulations
increased significantly by 26.7% to Rs.426.0
million during fiscal 2009 from Rs.336.5
million during fiscal 2008.
shifting towards other vaccines and
The following table sets forth the Company’s
35
The
pharmaceutical
formulations
segment’s
turnover grew
by 14% and
contributed
Rs.2,262.3 million
or 29.2% of net
turnover during
fiscal 2009.
gross turnover (inclusive of excise duty)
million for fiscal 2008. As a percentage of net
from pharmaceutical formulations in various
turnover, these expenses increased to 5.6%
categories:
in fiscal 2009 from 5.4% in fiscal 2008.
Fiscal
2009
2008
Research & Development (R&D) Expenses:
Rs. in Rs. in
million
% million
%
Renal Disease
Management
658.6
30%
487.6
24%
on R&D assets, increased by 22.0% to
Diabetes & Cardiovascular
Management
619.6
28%
547.0
27%
during fiscal 2008. The increase is mainly
Pain Management
397.9
18%
554.4
28%
Anti-Osteoporosis
144.9
7%
57.5
3%
Gastro-Intestinal & constipation
127.6
6%
105.4
5%
Oncology
45.0
2%
29.6
1%
related costs. Depreciation on R&D assets
Anti-Tubercular
50.7
2%
54.0
3%
increased by 28.7% at Rs.169.0 million as
Other Segments
172.9
7%
178.2
9%
against Rs.131.4 million during previous
Total
2,217.2
100% 2,013.7 100%
Expenditures:
Materials & Finished Goods Purchases:
The raw and packing materials consumed
Rs.500.9 million as against Rs.410.5 million
on account of expenses of new R&D
Centers which got operational during the
previous year and increase in personnel
cost of existing R&D Centers and research
financial year. Total R&D expenses (including
depreciation) increased to 8.7% of net
turnover during fiscal 2009 as against 6.5%
during previous year.
and finished goods purchased during the
Interest: Interest charges increased to
year under review has decreased by 27.3%
Rs.321.1 million during fiscal 2009 as against
at Rs.2,660.9 million as against Rs.3,658.4
Rs.116.3 million during fiscal 2008. The
million during the previous financial year.
increase in interest charges is attributable
The materials consumption ratio as a
to overall increase in interest rates, higher
percentage to net turnover has improved to
utilization of borrowed funds on account
34.4% from 44.1% during previous year.
of Foreign Currency Loan and utilisation of
Operating & Other Expenses: The operating
& other expenses increased by 14.4% to
Rs.806.4 million for fiscal 2009 from Rs.705.0
Total R&D
expenses
increased to
Rs.669.9 or 8.7%
of net turnover
during fiscal
2009 as against
Rs.541.9 or 6.5%
of net turnover
during previous
year.
The R&D expenses, excluding depreciation
increased working capital limits from Banks.
As a percentage of net turnover, the interest
charges increased to 4.1% from 1.4% in fiscal
million for fiscal 2008. As a percentage of
2008.
net turnover, the said expenses increased
Finance & Miscellaneous Charges: Finance
by 1.9% in fiscal 2009 to 10.4% from 8.5% in
and miscellaneous charges decreased to
fiscal 2008. The increase in these expenses
Rs.28.0 million during fiscal 2009 from Rs.35.5
was mainly on account of increase in various
million during fiscal 2008. As a percentage of
operating expenses like power & fuel,
net turnover, these expenses were at 0.4%.
insurance, legal & professional charges and
travelling costs, etc.
Depreciation: Depreciation increased by
64.0% to Rs.705.1 million as compared to
Personnel Expenses: The personnel expenses
Rs.430.0 million during fiscal 2008 due to
decreased by 0.9% to Rs.916.1 million for
capitalization of new production facilities
fiscal 2009 from Rs.924.9 million for fiscal
and R&D Centers, increase in other fixed
2008. As a percentage of net turnover, these
assets and capitalization of exchange
expenses marginally increased to 11.8% in
fluctuation losses in terms of the Companies
fiscal 2009 from 11.1% in fiscal 2008.
(Accounting Standards) Amendment Rules,
Selling & Distribution Expenses: The Selling &
2009. Depreciation as a percentage of net
Distribution expenses decreased by 3.7% to
turnover increased to 9.1% in fiscal 2009
Rs.434.5 million for fiscal 2009 from Rs.451.1
from 5.2% in fiscal 2008.
36
Profitability Margins:
Cash Flow from Operating Activities: The
Earnings Before Interest, Tax, Depreciation
& Amortisations (EBITDA): The Company
registered EBITDA of Rs.2,444.6 million for
fiscal 2009 as compared to Rs.2,177.6 million
for fiscal 2008. The EBITDA margin was 31.6%
liquidity position of the Company remained
almost constant with just 16.7% decline in
Operating Cash Profit during fiscal 2009 to
Rs.1,917.7 million as compared to Rs.2,301.2
million during fiscal 2008.
during fiscal 2009 as against 26.2% during
The net cash from operating activities
fiscal 2008.
declined by 95.7% during fiscal 2009
Profit / (Loss) Before Tax (PBT): The Company
suffered a loss before tax of Rs.923.7 million
for fiscal 2009 as against profit before tax
primarily on account of increase in
inventories, trade and other receivables and
decline in current liabilities.
of Rs.1,903.9 million for fiscal 2008, mainly
Cash Flow from Investing Activities: Net
on account of foreign exchange fluctuation
cash used in investing activities amounting
losses of Rs.2,260.4 million, provisioning
to Rs.1,261.9 million was primarily used for
due to permanent diminution of investment
acquiring fixed assets for various ongoing
made and doubtful loans/ advances
expansion/ new projects and loans/
including interest thereon aggregating
investment in subsidiaries/joint ventures
Rs.284.2 million and also partially due to
during the year under review.
increase in depreciation and other expenses.
Cash Flow from Financing Activities: The
Profit/ (Loss) After Tax (PAT): The PAT turns
Cash Flow from Financial Activities had
to negative at Rs.690.5 million for fiscal year
declined by 25.5% to Rs.1,571.3 million,
2009 from positive of Rs.1,331.7 million for
which basically consists of funds raised by
fiscal 2008.
way of long term / working capital loans to
Earning per Share (EPS): The basic EPS and
diluted EPS stood at negative Rs.10.35 per
fund various ongoing projects / working
capital requirement.
share of Re.1 as compared to Rs.20.14 and
Rs.18.85 per share respectively during fiscal
2008.
The consolidated net turnover of the
Company as a group has been Rs.7,881.7
Cash Flow Statement
million during financial year 2008-09 as
compared to Rs.8,413.4 million during
The following table summarizes our
financial year 2007-08.
statements of cash flows:
(Rs. in million)
Fiscal 2009 Fiscal 2008
Cash Flows from:
The consolidated EBITDA was Rs.2,473.0
million for fiscal 2009 as compared to
Rs.2,175.0 million for fiscal 2008. On
consolidated basis, the Company suffered
- Operating Cash Profit
1,917.7
2,301.2
- Changes in Working
Capital
(1,632.6)
(812.0)
(235.2)
(336.5)
million for fiscal 2008, in line with the
49.9
1,152.6
profitability on stand-alone basis.
- Investing Activities
(1,261.9)
(4,270.8)
- Financing Activities
1,571.3
2,109.0
at Rs.659.9 million for fiscal year 2009 from
359.3
(1,009.2)
positive of Rs.1,289.8 million for fiscal 2008.
- Net Direct Taxes Paid
- Operating Activities
Net Cash Flows
37
a loss before tax of Rs.866.7 million for fiscal
2009 as against profit before tax of Rs.1,876.0
The consolidated PAT also turned to negative
The Company
registered EBITDA
of Rs.2,444.6
million for
fiscal 2009 as
compared to
Rs.2,177.6 million
for fiscal 2008.
The EBITDA
margin was
31.6% during
fiscal 2009 as
against 26.2%
during fiscal
2008.
Opportunities and Outlook
India accounts for over one-third of drug
master files (DMFs) in biggest market, viz.
•
and technical manpower in the world
•
Strong marketing and distribution
network.
US and ranks 2nd in approved Abbreviated
New Drug Applications (ANDAs) with a major
Weakness:
share of 30% of total approvals in US.
•
Highly fragmented industry
Despite all hue and cries about financial
•
Low investments in innovative R&D
turmoil across the globe in recent times,
•
High Price Regulation
Indian Contract Research and Manufacturers
•
Production of spurious and low quality
(CRAMS) with their ready infrastructure and
R&D capability in hand stands strong to
deliver better growth.
India has the highest number of US
FDA approved plants outside the US.
Pharmaceutical production costs in India are
almost 50% lower as compared with western
drugs
•
Cost of conducting clinical trials in India is
also around 50-60% lower than the cost in
the US. Hence, global Pharma Innovators
who are already facing tremendous pressure
to protect their profitability are focusing
Opportunities:
•
Significant export potential
•
Marketing alliances with MNCs to sell
their products in domestic market
•
Opening up of the health insurance
sector
•
Potential for developing India as a centre
for international clinical trials.
•
Niche player in global pharmaceutical
R&D.
on cost rationalization activities and are
switching for outsourcing facilities from India
Strong linkages between industry and
academia is lacking
nations.
•
Increased expenditure on healthcare
which would boost the earning potential of
due to inter-alia, the ageing population,
Indian CRAMS.
emergence of “life-style” drugs, a shift
to newer and more expensive drugs, an
The Indian Pharmaceutical sector is emerging
increase in therapeutic coverage (i.e. new
as one of the major contributors to Indian
drugs for diseases that previously could
exports with export earnings rising from a
Despite all hue
and cries about
financial turmoil
across the globe
in recent times,
Indian CRAMS
with their ready
infrastructure
and R&D
capability in
hand stands
strong to deliver
better growth.
Third largest English speaking scientific
negligible amount in early 1990s to Rs.291
not be treated).
•
Innovation in Biotechnology
have grown at a CAGR of 17.8% during the
•
Emerging geographical markets
five-year period 2003-04 to 2007-08.
•
Huge unmet need for medication.
•
Rapidly increasing global population of
billion (US$7.24 bn) by 2007-08. The exports
At present, India is among the top 20
pharmaceutical exporters world-wide. As per
industry estimates, pharmaceutical exports
will continue to grow at a CAGR of 18.5%
between 2008-09 and 2011-12.
SWOT Analysis
Strengths:
seniors and obese patients leading to
higher risks for cardiovascular diseases,
certain types of cancer, diabetes and
arthritis.
Threats, Risks and Concerns
Risks, challenges and threats are inherent
in any type of industry and needs to be
•
Cost competitiveness
•
Well Developed industry with strong
The major risks associated to the industry as
manufacturing base
a whole are as under:
38
mitigated through well planned strategies.
•
Global meltdown – The recent global
and collaborations with varied partners.
meltdown has resulted in lower
Any adverse developments in such
investments both in existing business
JVs and collaborations may impact the
and new drug research. However, this has
Company.
not impacted your Company much.
•
Pricing pressure imposed by DPCO
•
Foreign Exchange fluctuations due to the
•
from other players in the industry.
•
unprecedented international currency
imbalances in the aftermath of the global
financial crisis.
•
Increased competition from low cost
manufacturing base such as China, Korea
and Taiwan.
•
•
The Company also faces competition
Delay in approvals from regulatory
agencies in various international markets.
Apart from these, other risks faced by the
Company include rise in input costs, rise
in interest rates, loss of key personnel,
exchange rate fluctuations, environmental
liabilities, tax laws, litigation, labour relations
FDA Compliance – Rising audit burdens,
and significant changes in the global political
inspections and fines
and economic environment.
Risk of Product failure
Apart from the above, there are a few risk
factors that are relevant to the Company’s
operations and business. While the Company
takes effective measures to minimize or
eliminate the impact of these risks on its
business performance, they nonetheless
Way Forward:
With a number of countries in recession
and drugs becoming almost a necessity
and Indian drug companies being generic
manufacturers, export growth is unlikely to
fall.
exist.
Domestic growth is expected to remain
Some such risks, challenges or threats are
healthy especially with the Government
outlined below:
•
The Company operates in a highly
regulated industry and must comply with
a broad range of dynamic regulatory
•
•
39
new low-priced medicine store chain). The
outbreak of swine flu is also expected to aid
the sales growth of Indian drug companies.
controls.
Further, this industry has witnessed a
In an industry where R&D is of critical
tremendous growth in consumer spending
importance, the Company faces a risk
on healthcare and is expected to continue
of all R&D initiatives not leading to
the same.
commercially viable and successful
There is no doubt about the capacity of
products.
•
expected to open more Jan Aushadhis (a
Indian pharmaceutical sector in taking the
Patent challenges or delay in receipt of
big leap forward. Therefore, with the rise in
regulatory approvals could delay product
disposable income, tremendous growth in
launch in key markets. Moreover, failure
exports, edge in CRAMS, stunning interest of
to obtain regulatory approval for new
global investors in Indian pharma and large
drugs under development could affect
number of USFDA approved plants, Indian
long term business opportunities.
pharmaceuticals industry’s growth is vast
The Company has several joint ventures
and is expected to materialize soon.
With the rise
in disposable
income,
tremendous
growth in
exports, edge in
CRAMS, stunning
interest of global
investors in
Indian pharma
and large
number of
USFDA approved
plants, Indian
pharmaceuticals
industry’s growth
is vast and is
expected to
materialize soon.
Future Growth Drivers
laid strategy for its future growth with clearly
Panacea Biotec aims to become a leading
global research based health management
company with an established leadership in
niche therapeutic areas. The Company has well
Short-term < 2 years
• Global launch of a NCE of
herbal origin in GI segment.
• Launch of Vaccine for Swine flu
(H1N1)
• Launch of organ
transplantation products in
ICH regions and key emerging
markets.
identified growth drivers to sustain and boost
its revenues and profitability over the short,
medium to long term. The key growth drivers
are as under:
Medium-term 2-5 years
• Launch of new combination
and other Vaccines currently
under development for
pediatric and adults.
• Supply of anti-TB and ARV
products to WHO/UNICEF.
• Launch of biosimilars
Long-term > 5 years
• Global Launch of NCEs and
NBEs.
• Launch of thermostable
vaccines.
• Potential supply of Anthrax
Vaccine to US for national
stockpiling program.
• Expansion of healthcare
segment.
• Launch of drug delivery based
products in anti-cancer, CVD,
GI and Pain Management
therapeutic segments in key
markets across the world.
• Diversification in related
healthcare segment.
In addition to above identified growth factors, the Company will continue to explore inlicensing of technologies/products from national/international research agencies/institutions
to fasten its growth strategy
The key growth
drivers during
short term interalia, include
global launch
of a NCE of
herbal origin
in GI segment,
launch of Vaccine
for Swine flu
(H1N1) and
launch of organ
transplantation
products in ICH
regions and
key emerging
markets.
Corporate Social
Responsibility
Safety, Health and Environment
Protection
Panacea Biotec undertakes all its operations
with a high concern for safety, health
and environment and is committed to
maintaining high standards in these areas.
Substantial investments have been made
in setting up Effluent Treatment Plants and
in developing a “Green Belt” and green
land scapping at the manufacturing sites at
Lalru & Baddi to prevent possible adverse
environmental impact on the community.
off as per the bio-waste management
system. All the bio-safety measures in R&D
are periodically reviewed by Bio-safety
Committee.
The Company has installed Modern Fire
Hydrant System with sprinkler system and
smoke detection & sensing devices at its all
major facilities, for an early detection and
extinguishing of accidental fire. Surprised
mock fire-fighting drills are also undertaken
to create awareness amongst the employees
to meet any challenge which may arise out of
such incidents.
Regular training is also provided to the
Company’s employees about the importance
The vaccine R&D facility has been created
of safety in day-to-day life in general
with classified laboratories including BL-3
and work in particular. The integration
facility for carrying out certain R&D activities
of environment friendly measures and
which require containment. All personnel
cleaner production practices in the business
working in R&D are vaccinated as per the
process has resulted in better efficiency of
Vaccination Policy. Bio-waste is disposed
operations.
40
Social Responsibility
•
spreading awareness and facilitating
Panacea Biotec works closely towards the
detection for diabetes and neuropathic
development of society, in line with its
complications of diabetes through
philosophy of creating happier and healthier
regular diabetes detection and
society. Health, education, disaster relief and
neuropathy screening initiatives.
patient awareness have been identified as
the areas of priority. The emphasis has been
Diacar SBU was vigorously involved in
•
The company uses its BMD machines
to provide assistance on a need basis, and
to conduct highly subsidized tests
that too, assistance at a local level.
to measure bone mineral density of
patients for facilitating early diagnosis of
The Company is regularly providing financial
osteoporosis, which not only has a huge
assistance/ sponsorship for pursuing post
morbidity burden but also is a leading
graduates/ doctorate studies, attending
cause of death in older patients due to
International Conferences and carrying
hip fractures. In last 12 months, Panacea
out Research Projects being undertaken by
Biotec has screened more than 1 lac
Research Associates in various Institutes &
patients.
Universities.
The Company regularly takes initiatives
•
on November 20th, the Company
towards fulfilling its corporate social
conducted 145 Piles Detection Camps
responsibility including:
•
•
across geographies in India with a view
Patient Home delivery for Transplant
to facilitate piles detection across all
drugs.
strata of patient population and to bring
awareness for piles, which is highly under
Donation of life saving drugs to hospitals
diagnosed in India.
as per their need.
•
Transplant Fortnight - Patient awareness
•
Cancer Awareness Program to create
72 Organ Transplant centers and
awareness on Importance of Early
drawing more than 3500 patients. Major
Detection in Breast Cancer.
emphasis has been on ways and means
to improve the Post-transplant life of
transplant recipients
Organized a symposium on “Challenges
in Prevention and Management of
Dengue” at Delhi, which was well
•
•
To keep pace with the rapidly advancing
field of Oncology, 3 therapy specific
symposiums were conducted on Breast
Cancer, Lung Cancer and Radiation
Oncology.
attended by Doctors, experts on this
Doctor’s Day: Continuing the gesture of
field and media personnel, with a view
showing it’s gratitude towards the medical
to provide a global snap shot of Dengue
fraternity, your company wished all the
to the medical fraternity and facilitate
doctors a happy Doctor’s Day on 1st July.
deep insights about prevention and
Messages of good wishes from the Chairman
management of Dengue.
Mr. Soshil Kumar Jain for the doctors were
Organized various renal function
detection camps as part of the awareness
41
One of the first Indian companies to
successfully run a month long Breast
activities spread across India covering
•
On the occasion of ‘World Piles Day‘
released through Newspapers, SMS as well as
FM Radio.
towards prevention of Chronic Kidney
The patients were also encouraged to
Disease on World Kidney Day.
show their gratitude towards their doctors
The Company
is regularly
providing
financial
assistance/
sponsorship
for pursuing
post graduates/
doctorate studies,
attending
International
Conferences
and carrying
out Research
Projects.
CHINH: As in the past, during the current
year, the Company continued to support
CHINH to make a difference in lives of
nomads in foothills of Aravali and began a
tradition of development that must continue.
CHINH is an NGO’s initiative to support
Nomadic communities in generating
livelihood through harnessing their
traditional wisdom, art and culture.
Dedicated to nomads of India, this initiative’s
prime focus is helping future generation of
nomads in creating space for them in civil
society and encouraging them to lead a life
by wishing them on the occasion. Many
of dignity.
doctors responded to the message of the
People for Animals: During the year under
Chairman by sending e-mails and SMS. This
review, the Company also supported People
pioneering activity from Panacea Biotec
for Animals an NGO based at Delhi to bring
would strengthen the relationship between
help and hope to thousands of needy
the doctors and the people at large.
animals around the Country.
Cautionary Note
Certain statements in the “Management Discussion and Analysis” and other sections in the Annual
Report are forward-looking statements. These statements and expectations envisaged by the
management are only estimates in nature and are based on current expectations and forecasts
about future events. Such statements involve known/unknown risks, uncertainties and other
factors and may cause and defer the actual results materially. Such factors include, but are not
limited to, changes in local and global economic conditions, the Company’s ability to successfully
implement its strategies, the market acceptance and demand of the Company’s products and
services, the Company’s growth rates, expansion, technological changes and the Company’s
exposure to market risks. By this nature, these indications and forecasts/projections are only
estimates and actual results could differ from these in future. The Company does not undertake any
obligation to update forward-looking statements to reflect events or circumstances after the date
hereof.
Note: As a result of rounding-off adjustments, the figures/percentages in a column in various sections in the Annual Report may
not add up to the total for such column.
42
Directors’ Report
Dear Members,
We are pleased to present the 25th Annual Report on
business and operations together with the audited
financial statements and the auditors’ report of your
Company for the financial year ended March 31, 2009. The
financial highlights for the year under review are given
below:
Financial Results
(Rs. in million)
Particulars
For the
For the
year ended year ended
March 31, 09 March 31, 08
Net Turnover Other Income 7,734.2
8,304.4
259.7
371.7
Total Income
7,993.9
8,676.1
Profit before Interest, Depreciation, Exceptional
items & Tax (EBITDA)
2,444.6
2,177.6
Depreciation
705.1
430.0
Financial Expenses
347.4
150.1
Unrealised Foreign Exchange Fluctuation Loss
1,750.7
40.5
Profit/(Loss) before Exceptional items & Tax
(639.5)
1,903.9
284.2
-
Profit/(Loss) before Tax (PBT) Exceptional item (923.7)
1,903.9
Provision for Taxation (233.2)
572.2
Profit/ (Loss) after Tax (PAT)
(690.5)
1,331.7
Dividend Paid/Proposed on Equity Shares
-
66.7
Tax on Dividend -
11.3
Transfer to General Reserve
-
133.1
2,155.2
2,845.7
Basic EPS (Rs.)* (10.3)
20.1
Cash EPS (Rs.)* 30.0
27.0
Book Value per Share (Rs.)* 92.1 104.3
-
1.0
Balance in Profit & Loss Account
Dividend per Equity Share (Rs.)
a growth of 12%. The PBT and PAT for the year
under review turned negative at Rs.923.7 million
and Rs.690.5 million respectively as compared to
profits of Rs.1,903.9 million and Rs.1,331.7 million
respectively inter-alia, on account of drastic reduction
of exchange rate of Indian Rupee vis-a-vis US dollar
from Rs.40.11 per dollar as on 31.03.2008 to Rs.50.72
per dollar as at 31.03.2009, provisioning of unrealized
foreign exchange loss of Rs.1,702.6 million on
open forward contracts for the unexpired period of
contracts and provisioning of Rs.168.0 million on
account of permanent diminution of investment
(representing 10% stake) in Cambridge Biostability
Ltd. (CBL) and of Rs.116.2 million as doubtful on
account of Convertible Loan and interest accrued
thereon due from CBL.
In terms of revised AS-11, the Company has opted
for change in accounting policy in respect of
foreign exchange fluctuation difference relating to
translation of long term foreign currency monetary
liabilities. Consequently foreign exchange fluctuation
gain of Rs.131.7 million up to March 31, 2008 and
foreign exchange fluctuation loss of Rs.994.7 million
during the year under review, has been adjusted
to the cost of depreciable asset or transferred to
the Foreign Currency Monetary Item Translation
Difference Account, depending upon nature of
utilization. This has resulted into reduction in losses
during the year by Rs.850.1 million.
Nevertheless, the Company was still able to earn
operating profit of Rs.1,244.6 million during financial
year 2008-09 as against Rs.1,836.7 million during the
corresponding previous financial year.
Your Company continues to focus on sustaining
growth in emerging markets, cost optimization and
efficient management of working capital.
A detailed discussion on operations for the year
ended 31st March, 2009 is given in the Management
Discussion and Analysis section.
Dividend
* Face value Re.1/- per share
Operations Review
During the year ended March 31, 2009, the Company
registered net turnover of Rs.7,734.2 million as against
Rs.8,304.4 million during the corresponding financial
year. The Company registered EBITDA of Rs.2,444.6
million as compared to Rs.2,177.6 million during the
corresponding previous financial year, registering
43
In view of non-availability of profits during the
year under review, the Board of Directors has not
recommended any dividend on the Equity Shares of
the Company.
Share Capital
During the year under review, the Issued Equity Share
Capital of the Company remained unchanged at
Rs.66.8 million consisting of 66,842,746 Equity Shares
of Re.1 each.
Corporate Governance
The Company has duly complied with the provisions
of the Corporate Governance Code as prescribed
under Clause 49 of the listing agreement with the
Stock Exchanges. A separate section on Corporate
Governance Report along with a certificate from M/s.
Dass Gupta & Associates, Chartered Accountants
confirming the level of compliance is annexed and
forms a part of the Directors’ Report.
Management Discussion & Analysis
As required by Clause 49 of the Listing Agreement
with the Stock Exchanges, a detailed Management
Discussion and Analysis Report forms part of the
Annual Report.
Subsidiaries
The Company, as on March 31, 2009, has 5 wholly
owned subsidiaries (WOS), viz. Best On Health Ltd.,
Panacea Biotec, Inc., Panacea Biotec FZE, Panacea
Biotec GmbH and Rees Investments Ltd. and a
subsidiary, viz Umkal Medical Institute Pvt. Ltd., in
terms of Section 4(1)(b)(ii) of the Companies Act,
1956. Besides, Radicura & Co. Ltd., Panacea Hospitality
Services Pvt. Ltd., Sunanda Steel Company Ltd. &
Panacea Educational Institute Pvt. Ltd. are the WOS of
Best On Health Ltd.; Kelisia Holdings Limited, Cyprus
is the WOS of Rees Investments Ltd. and Kelisia
Investment Holdings AG, Switzerland & Panacea
Biotec (International) SA, Switzerland are step-down
subsidiaries of Rees Investments Ltd. In terms of
Section 4(1)(c) of the Companies Act, 1956, these 7
companies are the subsidiaries of the Company.
In terms of the approval granted by the Central
Government under Section 212(8) of the Companies
Act, 1956, copies of the Balance Sheet, Profit and Loss
Account and Reports of the Board of Directors and
Auditors of the Subsidiaries have not been attached
with the Balance Sheet of the Company. However,
these documents will be made available upon request
by any investor of the Company/ subsidiary, interested
in obtaining the same. As directed by the Central
Government, the financial data of the subsidiaries has
been furnished elsewhere in the Annual Report. The
annual accounts of the subsidiary companies will be
kept for inspection by any investor at the Company’s
Corporate Office at B-1 Extn./G-3, Mohan Co-operative
Industrial Estate, Mathura Road, New Delhi – 110044,
India and at the office of the respective subsidiary
companies during business hours of the Company.
44
Joint Ventures
Chiron Panacea Vaccines Pvt. Ltd. - During the
year under review, your Company’s Joint Venture
Company (JV Company), Chiron Panacea Vaccines
Pvt. Ltd. (“CPV”), set-up for marketing of innovative
combination and other vaccines in India has launched
Hepatitis A vaccine HAVpur, a new generation vaccine
with virosome technology in collaboration with Berna
Biotech Ltd., Switzerland and the Company’s Injectable
Polio Vaccine “PolProtec” and monohib Vaccine
(novoHib) in the Indian market. With these launches,
CPV has a strong portfolio of innovative paediatric
vaccines and in short span has taken significant
position at market place. CPV achieved a turnover of
Rs.538.4 million and net profit of Rs.41.6 million during
the year under review. CPV continues to maintain a
significant market share in the pediatric combination
vaccines segment in India.
Cambridge Biostability Ltd. - The Company’s another
JV Company, Cambridge Biostability Ltd. (CBL), a U.K.
based Company, in which the Company acquired 10%
stake and also lent a Convertible Loan of £ 1.5 million
during earlier years, has gone into Creditors’ Voluntary
Liquidation proceedings during current fiscal, due to
its adverse financial position.
Associates
Your Company’s Associate Company, PanEra Biotec
Pvt. Ltd. is continuing to meet requirement of bulk
vaccines and antigen for the manufacture of Hepatitis
B and Combination Vaccines by your Company. PanEra
has become a specialised company focused on bulk
manufacture of vaccines and plans to venture into new
product and technologies.
During the year under review, the Company’s associate
firm, viz. M/s Lakshmi & The Manager, in which the
Company had invested Rs.40.0 million (40% share), has
been taken over by a newly formed company, Lakshmi
& Manager Holdings Limited. As a result of takeover of
the said firm, the Company has been allotted Equity
Shares for an amount of Rs.41.3 million in the said
company.
As required under clause 41 of the Listing Agreement
with the stock exchanges, a consolidated financial
statement of the Company and its subsidiaries, joint
venture and associates, as prepared in accordance
with the Accounting Standard AS-21 on ‘Consolidated
Financial Statements’ read with Accounting Standard
AS-27 on ‘Financial Reporting of Interest in Joint
Ventures’ and Accounting Standard AS-23 on
‘Accounting for Investments in Associates’, as issued
by the Institute of Chartered Accountants of India,
is attached herewith and the same together with
Auditors’ Report thereon forms part of the Annual
Report of the Company.
Mr. R. L. Narsimhan, Mr. N. N. Khamitkar and Mr. Sunil
Kapoor, Directors of the Company, are liable to retire
by rotation and being eligible, offer themselves for
re-appointment.
Listing of Equity Shares / Bonds
A brief resume, expertise, shareholding in the
Company and details of other directorships of these
directors as stipulated under clause 49 of the Listing
Agreement with the Stock Exchange forms part of the
Notice of ensuing Annual General Meeting.
The Equity Shares of the Company continue to be
listed on National Stock Exchange of India Ltd. (NSE)
and Bombay Stock Exchange Ltd. (BSE). The Foreign
Currency Convertible Bonds (FCCBs) are listed at
Singapore Stock Exchange. The annual listing fees for
the year 2009-10 have been paid to these Exchanges.
Public Deposits
Auditors
During the year under review, your Company has
not invited or accepted any deposits from the public
pursuant to the provisions of Section 58A of the
Companies Act, 1956 and no amount of principal or
interest was outstanding in respect of deposits from
the public as of the date of Balance Sheet. However,
during the year under review, the Company has
continued to accept deposits from the Company’s
Directors, their relatives, associates and the Company’s
employees without inviting deposits from them.
As per the provisions of the Companies Act, 1956,
M/s. S.R. Batliboi & Co., Chartered Accountants, hold
office as Statutory Auditors of your Company till the
conclusion of the ensuing Annual General Meeting
and have shown their willingness to be re-appointed
as the Auditors of the Company.
Insurance
The Company’s properties and insurable assets like
building, plant & machinery, stocks and upcoming
projects have been adequately insured, against major
risks. The Company has also taken appropriate product
liability insurance policies for conducting clinical trials
and for insuring its products (manufactured & sold)
with an add on cover of pollution liability and limited
unnamed vendor extension liability to cover the risk
on account of claims, if any, filed against the company.
Internal Control System
The Company has a sound Internal Control System,
which ensures that all assets are protected against
loss from unauthorized use and all transactions are
recorded and reported correctly. The internal control
systems are further supplemented by internal audit
carried out by independent firms of Chartered
Accountants and periodical review by management.
The Audit Committee of the Board addresses
significant issues raised by both, the internal Auditors
and the Statutory Auditors.
Directors
There was no change in the composition of the Board
of Directors of the Company during the year under
review.
In accordance with the provisions of the Companies
Act, 1956 and Articles of Association of the Company,
45
The Board recommends the appointment of Mr. R. L.
Narsimhan, Mr. N. N. Khamitkar and Mr. Sunil Kapoor.
Based on the recommendation of the Audit
Committee, the Board of Directors of the Company
proposes the re-appointment of M/s. S.R. Batliboi &
Co., Chartered Accountants, as the Auditors of the
Company. Further, as required under Section 224(1B) of
the Companies Act, 1956, they have confirmed that the
said appointment, if made, will be within the limits as
prescribed under the provisions thereof.
Auditors’ Report
With regard to the matters of emphasis and
observations contained in the Auditors’ Report,
management’s explanations are given below:
a. Non-provision of proportionate premium on
redemption of ‘US$ 50 million Zero Coupon
Convertible Bonds due 2011’ amounting to
Rs.470,992,269: The Board of directors are of the
opinion that since the bonds are redeemable
only if there is no conversion of bonds earlier,
the probability of which cannot be presently
ascertained, hence, the payment of premium on
redemption is contingent in nature, the outcome
of which is dependent upon uncertain future
events. Therefore, the same has been disclosed
as a contingent liability. Moreover, in case of
redemption, the redemption premium will be
offset against the Securities Premium Account, thus
having no impact on the Profit & Loss Accounts.
b. Capitalization of expenditure on clinical trials
amounting to Rs.123,978,449 for the purpose
of registration of Company’s products in US
and/or Europe: The expenditure is not towards
basic research and there is no experience to
suggest that the studies conducted by CRO on
behalf of the Company would lead to or make
it difficult for the Company to obtain regulatory
approval. Hence, the management believes that
these products would be commercially viable
and there is no reason to believe that there is
any uncertainty that may lead to not securing
registration for the products from regulatory
authorities in US and/or Europe.
c. Payment of managerial remuneration of
approximately Rs.38,169,706 for the current year
in excess of limits prescribed as per Part II of
Schedule XIII to the Companies Act, 1956, without
Central Government approval: The Company had
adequate profits for past many years and thus
has been paying remuneration to its managerial
personnel as per shareholders approval within
overall limits as specified under the Companies
Act, 1956. However, since in view of the reasons
explained elsewhere in this Report the Company
has incurred losses during the year under review,
the managerial remuneration paid during the
year amounting to Rs.63,035,463 exceeded the
limits prescribed under the Act by Rs. 38,169,706.
The Company has sought approval of the Central
Government for protection of such remuneration.
d. Slight delay in deposition of Value Added Tax
(VAT), Employees’ State Insurance (ESI) and
Service Tax in few cases: The amount involved was
not significant and the said delays were due to
normal operational difficulties. The total amount
of such VAT, ESI and Service Tax was Rs.2,163,478,
Rs.379,832 and Rs.436,256, respectively only and
the Company had already deposited the said
amount. Interest amounting to Rs.447,675 was also
paid in respect of delay in payment of Service Tax
for the delayed period.
Further, with regard to the matter of emphasis and
observation contained in the Auditors’ Report on
the Consolidated Financial Statement as regards
Unaudited Annual Accounts of Subsidiaries – Panacea
Biotec GmbH, Germany, Kelisia Investment Holdings
AG, Switzerland and Panacea Biotec (International)
SA, Switzerland, though the Annual Accounts of
these subsidiaries were prepared by their respective
Board of Directors but the audit thereof could not
be completed till the date on which the Company’s
Accounts were finalised. The audit exercise had since
been completed and there is no change in the assets,
revenues and cash flows thereof.
The notes to the accounts and other observations, if
any, in the Auditors’ Report are self-explanatory and,
therefore, do not call for any further comments.
Companies Act, 1956, M/s J.P. Gupta & Associates,
Cost Accountants, have been appointed as the Cost
Auditors to conduct the audit of the Company’s Cost
Records in respect of formulations for the year ended
31st March, 2009 with the approval of the Central
Government. The cost audit is under process and
the Company will submit the Cost Auditors’ Report
to the Central Government in time. M/s J.P. Gupta &
Associates, have also been appointed by the Board as
the Cost Auditors for the financial year 2009-10 subject
to the approval of Central Government.
Disclosures under Section 217 of the Companies
Act, 1956
Except as disclosed elsewhere in the report, there
have been no material changes and commitments,
which can affect the financial position of the Company
between the end of financial year and the date of
report.
As required under Section 217(2) of the Companies
Act, 1956, the Board of Directors inform the members
that during the financial year there has been no
material changes, except as disclosed elsewhere in this
report:
•
in the nature of Company’s business,
•
in the Company’s subsidiaries or in the nature of
business carried out by them,
•
in the classes of business in which the Company
has an interest.
Energy Conservation, Technology Absorption &
Foreign Exchange
Particulars required under Section 217(1)(e) of the
Companies Act, 1956, read with the Companies
(Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988, regarding conservation of
energy, technology absorption and foreign exchange
earnings & outgo, is given in Annexure A, forming part
of this Report.
Information regarding Employees
The information required to be furnished under
section 217(2A) of the Companies Act, 1956, read with
Companies (Particulars of Employees) Rules,1975
as amended, the names and other particulars of
employees covered under these Rules are set out in
Annexure B, forming part of this Report.
Directors’ Responsibility Statement
The Directors hereby confirm:
Cost Auditors
Pursuant to the provisions of Section 233B of the
46
i.
that in the preparation of the annual accounts,
the applicable accounting standards had been
followed along with proper explanation relating
to material departures;
ii.
that the directors had selected such accounting
policies and applied them consistently and made
judgments and estimates that are reasonable
and prudent so as to give a true and fair view of
the state of affairs of the Company at the end of
the financial year and of the profit or loss of the
Company for that period;
iii. that the directors had taken proper and sufficient
care for the maintenance of adequate accounting
records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets
of the Company and for preventing and detecting
fraud and other irregularities; and
iv. that the directors had prepared the annual
accounts on a going concern basis.
continued co-operation, patronage and trust reposed
on the Company and its products. The Directors
place on record their gratitude to the government,
other statutory bodies, our strategic partners,
business associates, banks, financial institutions and
shareholders for their assistance, co-operation and
encouragement they extended to the Company.
Your Directors also place on record their sincere
appreciation for significant contribution made by
the employees at all levels through their dedication,
hard work and commitment and look forward to their
continued support and unstinting efforts in ensuring
an excellent all round operational performance. It is
this unity of purpose that breeds success and your
Directors look forward to receiving similar support and
encouragement from the larger Panacea family in the
years ahead.
Acknowledgments
Your Directors take this opportunity to express sincere
thanks to the medical fraternity and patients for their
For and on behalf of the Board
New Delhi
Soshil Kumar Jain
30th July, 2009
Chairman
Annexure to the Directors’ Report
Annexure A
Statement of Particulars pursuant to the Companies (Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988.
I.
Conservation of Energy
•
Installed Variable Frequency Drive
(VFD) on Chilled Water Transfer Pump of
Refrigeration Plant at Pharma Formulation
Plant, Baddi.
•
Discontinued the operation of Primary
Chilled water circulation pumps of
Refrigeration plants by taking Secondary
Chilled water transfer pumps also in the
Primary Circuit by carrying out the Chilled
water line modification.
•
Stoppage of Electrical Heaters as well as
Hot Water Circulation to Dehumidifiers
of Pharma Formulation Plant, Baddi by
maintaining the required RH (Relative
Humidity) with the help of Chilled Brine
only.
•
Operating Hours of AHUs have been
optimized at various sections at Lalru and
Baddi.
•
Started stopping of hot water circulation
pump for HVAC operations during night
hours at Vaccine Formulation Plant, Baddi.
•
Started stoppage of Cooling Tower
dedicated pumps to Air Compressors
and Diesel Gen Sets and the same was
optimized with Cooling Tower pumps of
1. Energy Conservation measures taken
The Company accords highest priority to
energy conservation and is committed for
energy conservation measures including
regular review of energy consumption and
effective control on utilization of energy. The
Company had devised its production lines and
other facilities keeping in view the objective of
minimum energy losses.
The following are the major energy
conservation measures implemented during
the financial year 2008-09 with an objective to
substantially reduce power consumption:
•
•
47
Stoppage of Chilled Brine Refrigeration
plants during night shifts at Pharma
Formulation Plant, Baddi and maintaining
the required Facility conditions by
running them in day shift operations. Also
increased Cut off Set point temperature.
Increased Chilled Water Evaporator
temperature and reduced Air Compressor
Working Pressure for Vaccine Formulation
Plant, Baddi to reduce the Power
consumption.
Refrigeration plants of Pharma Formulation
Plant, Baddi.
•
Optimized Air Compressor running hours
at Vaccine Block-1, Lalru by providing lower
capacity Air Compressor during Night
Hours.
•
Optimized Hot Water circulation by
replacing Pump set with lower capacity at
Vaccine Block-2, Lalru.
•
Optimized Lighting circuits at Lalru.
•
Provided Timer Circuit to Animal House
Exhaust Air Units, Lalru Plant.
•
Started stopping Raw Water Boosting
Pump during night hours at Lalru Plant.
•
Installed Temperature controllers for all
Cooling Tower Fans with respect to Wet
Bulb Temperatures.
•
Installed Level Controller on Soft Water
storage tank to prevent the overflow of
water and atomized the Soft Water Pump.
•
Started stoppage of Split Air Conditioning
Units during winter season at various
sections in Vaccine Formulation Plant at
Okhla, New Delhi.
•
Optimized running hours of AHUs of non
critical areas of Okhla Vaccine Formulation
plant.
•
Optimized running hours of Machine
Room AHUs of GRAND, Mumbai.
•
Optimized Lift working hours at GRAND,
Mumbai.
•
Installed Motion sensors for lighting at all
Toilets of GRAND, Mumbai.
•
•
for controlling street lamps so that it
automatically gets off in the morning.
•
Installed PRV for oxygen generation
plant and there running of only one air
compressor in place of 2 Air Compressors.
•
Modified the Brine water lines and
removed the primary pump concept.
•
Effective running of Air Compressor and
removed all air leakages.
•
Throttling of Chilled water discharge valves
and decreased the motor loads.
•
Ensure switching off all corridors lights in
day time.
•
Close monitoring of FO consumption in
Boilers and reduced its working pressure
•
Close Monitoring of HSD consumption for
DG
•
Hot water system replaced the 3.7 KW
motor with 2.2 KW for HVAC system
2. Additional Investments/ Proposals, if any, for
reduction of Energy Consumption
Continuous efforts are being made to further
reduce the expenditure on power & fuel in the
time to come. Continuous Energy Conservation
Campaign is going on at all locations and
based on that steps are being taken related to
optimization in existing as well as new system
implementation. Many Techniques have already
been introduced during the financial year
2008-09:
•
Increased the Power Factor across
all locations to reduce the Power
Consumption.
Modification of Cold rooms so as to
increase the efficiency of the cold rooms &
to reduce the electrical load.
•
Reduced Boiler working pressure and
Compressed Air Pressure at vaccine facility
at Okhla.
Installation of the ETP to comply the
statutory compliance against Pollution
control board norms.
•
New central dispatch facility to carry out
the dispatch activities includes secondary
packing material storage.
•
Reusing the R.O. reject water for non
critical use like feed for cooling towers.
•
Incorporated temp. controller in CT fan for
the Chiller.
•
Reduced/replaced the GLS, flouroscent
tube lights with CFL at all locations.
•
De-scaled indoor & outdoor units of AC’s
so as to reduce the electrical load.
•
Modified the needles of Vial washing M/c
OPV & Line III reducing the consumption of
DM water.
•
Inbuilt battery charger installed in the D.G.
sets.
•
Introduction of light control device
48
Further, a few new Energy Conservation
technologies including Earth Air Tunnel,
Thermal Refrigeration Storage, Side Stream
Cooling Tower Water Cleaning on-line
Technology etc. are in pipeline for future
implementation.
3. Impact of measures taken and impact on
cost of production of goods
The energy conservation measures indicated
above have helped the Company to restrict the
impact of increase in the cost of energy thereby
reducing the cost of production of goods to
that extent.
FORM A
The particulars of consumption of energy, are given below:
Current Year
A. Power and Fuel Consumption
1. Electricity
(a) Purchased
Units (Nos.)
15,011,387
Total Amount (Rs.)
67,830,374
Rate/Unit (Rs.) 4.52
(b) Own generation
(i) Through Diesel Generator
Units (Nos.)
3,397,584
Unit per litre of Diesel Oil
3.49
Cost/Unit (Rs.)
8.91
(ii) Through Steam/Turbine Generator
Nil
Units (Nos.)
Unit per litre of Fuel Oil/ Gas
Cost/Unit
2. Coal
Nil
Quantity (tonnes)
Total Cost
Average Rate
3. Furnace Oil
Quantity (Litres)
505,115
Total Amount
11,824,571
Average Rate/litre
23.41
4. Others/Internal generation
Nil
Quantity
Total Cost
Rate/Unit
B.
Consumption per unit of production
Tablets
Production (Nos. in thousand)
Electricity Consumption (Units per thousand)
Capsules
Production (Nos. in thousand)
Syrups
Production (in litres)
Gels
Production (in kilograms)
Vaccines
Production (No. of vials in thousand)
Pre-filled Syringe (PFS)
Production (Ml. in thousand)
Granules
Production (Packs in thousand)
Previous Year
8,624,456
38,257,058
4.44
2,827,525
3.49
8.07
Nil
Nil
Nil
504,389
4.52
420,871
3.67
61,027
24.33
51,414
66.55
283,921
0.76
246,057
1.41
23,475
2.62
65,586
3.05
50,554
65.44
69,507
46.52
1,680
244.15
-
17,639
17.07
-
II. Technology Absorption
FORM B
Form for disclosure of particulars with respect to Technology Absorption
Research & Development (R&D)
The areas of research being pursued by the
Company include:
1. Specific areas in which R & D carried out by the
• Development of novel preventive & therapeutic
Company
vaccines, novel therapeutic peptides and
The Company is a research focused & IPR oriented
therapeutic fully human monoclonal
company whose one of the end objectives is
antibodies.
innovation and development of patentable
• Development of advanced drug delivery
products and technologies.
technologies.
49
•
Discovery & synthesis of new chemical and
biological entities.
• Development of recombinant clones for
biosimilars.
• Product development for different categories of
drugs.
2. Benefits derived as a result of above R&D
• Improved product quality leading to customer
satisfaction
• Vaccine against bioterrorism
• Safe and environment friendly process
• Novel drug delivery products
• Competitively priced products
• Waste minimisation
• Grant of Product/Process Patents
• Import substitution leading to lower cost of
goods
• Enhanced global presence
• Export of Quality Products
3. Future plan of Action
The Company will continue to focus its Research &
Development activities for growing the revenues &
profitability, inter-alia, in the following areas:
• Development and improvement in existing
conjugation technology for better yield and
quality.
• Drug Discovery Research
• Advanced Drug Delivery Research
• Research for development of novel preventive
& therapeutic vaccines, therapeutic fully
human monoclonal antibodies and therapeutic
peptides.
• Development of thermostabilised vaccines.
• Natural Products Research
• Chemical Research & Development
4. Expenditure on R&D
(Rs. in million)
2008-09 2007-08
a) Revenue
500.9
410.5
b) Capital
578.4
666.2
1,079.3 1,076.7
c) Total
d) Total (as a % of net sales) 14.0%
13.0%
Technology absorption, adaptation and Innovation
1.
2.
3.
Efforts, in brief, made towards technology adaptation and innovation: The Company has built a strong R&D
base to support its business segments, vaccines, formulations and biopharmaceuticals. It has five highly
sophisticated ultra-modern R&D centers with 391 employees including 261 qualified and experienced scientists
for its various research projects. The core area of research & development includes new Vaccine Development,
Biopharmaceuticals, proteins, peptides, monoclonal antibodies, Novel Drug Delivery Systems projects, Advanced
Drug Delivery System projects and Drug Discovery (small molecules), in compliance with international regulatory
standards.
The Company has developed indigenous technologies in respect of various products being manufactured by it
and at present working on several novel products and technologies. Further, the Company has made in-licensing
arrangements for technologies and development of (a) Vero cell adapted Japanese encephalitis (JE) Vaccine, (b)
Peptide based product for generation of hair follicles and hair growth, and (c) Recombinant Chimeric Dengue
Vaccine, during earlier financial years. The technology in-licensed for JE Vaccine, has been further modified
significantly at our research center to yield a commercially viable and safer product. The candidate vaccine is in
trial stages of development and should enter preclinical/clinical development by next year.
Benefit derived as a result of the above efforts, e.g., product improvement, cost reduction, product development,
import substitution, etc.: Competitive products, Product quality improvement, Product Development and Import
Substitution and with in-licensing arrangements, the Company will be able to commercialize these products in
domestic and international markets.
In case of imported technology (imported during the last 5 years reckoned from the beginning of the financial
year), following information may be furnished;
Technology imported
Year of Has technology import
been fully
absorbed
(a)
(b)
(c)
1. Technology for use of 2004-05
No
peptide based products for generation of hair
follicles and hair growth
2. Tetravalent Dengue 2006-07
No
Virus Vaccine
3. Technology for 2007-08
Yes
manufacture of Hep B
Antigen & Bulk Vaccines
50
If not fully absorbed, areas where this
has not taken place, reasons thereof
and future plan(s) of action
(d)
The technologies are being worked upon. The process
for the scale-up production of hair growth peptide has
been optimized. A pre-clinical toxicological study
has been planned.
The technologies are being worked upon. A suitable cell
line for the assay and amplification technology of
recombinant chimeric Dengue virus has been prepared.
Appropriate Dengue viruses have been amplified and
immunogenicity of candidate virus has been planned.
NA
III. Foreign Exchange Earnings and Outgo
1. Activities relating to exports
The total export turnover of the Company was
Rs.5,612.9 million (including deemed exports of
Rs.3,708.4 million) during the year under review
as against Rs.6,442.8 million (including deemed
exports of Rs.5,797.3 million) during fiscal 2008.
The Company is supplying Oral Polio and
Combination Vaccines to various countries through
UNICEF against its global tenders and achieved
an export turnover of Rs.1,478.4 million by way of
supplies of vaccines to various countries including
Afghanistan, Central Africa, Kenya, Sudan, Myanmar,
Namibia, Nigria, Pakistan, Russia, Tanzania, Uganda
Uzbekistan through UNICEF, as against Rs.309
million during the previous year, achieving an
excellent growth of more than 370%.
As regards formulations, the Company is
continuously expanding its global aspirations by
improving its international marketing efforts into
various markets across the globe and is currently
exporting its branded formulations in CIS countries,
Asia, Eastern Europe and African region. Today the
Company’s products are available to people in
various countries across the globe.
The export turnover of formulations during fiscal
2009 increased by 27% to Rs.426.0 million from
Rs.336.5 million during fiscal 2008.
The major markets continue to do well inspite of
recessionary trends in the later part of the year.
In addition to this, successful commercialization
happened in newer markets across Central America,
Africa and Asia. The exports to Russia & Thailand
have shown excellent growth of 77% & 53%,
respectively over the previous fiscal.
2. Initiatives taken to increase export
The year under review marked the achievement of
landmark initiatives & accolades for the Company’s
international formulations business.
The company has identified Organ Transplantation,
Nephrology, Metabolic Disorders, Pain management,
Oncology, Gastro-intestinal, Anti-infectives products
as major thrust areas for the future. The Company
has been adopting a strategy of increasing its
international brand image and is rapidly expanding
to reach out to more and more countries. It has
also obtained brand registration for various brands
in different countries and is actively exploring
opportunities for launching as well as licensing out
some of its patented products for manufacture/
marketing in Europe, North America, Latin America,
etc.
The Company is also currently in the process
of registering its products in key new markets
including US, European Union, Switzerland, South
Africa, Turkey, Brazil, Mexico, Columbia, Venezuela,
Chile, Philippines & Malaysia.
51
3. Development of new export markets for
products and Export Plans
With a view to increase opportunities, the efforts
on international marketing have been further
intensified. The Company has been adopting a
strategy of increasing its international brand image
and is actively exploring opportunities for launching
as well as licensing out some of its patented
products for manufacture/ marketing in key new
markets including US, European Union, Switzerland,
South Africa, Turkey, Brazil, Mexico, Columbia,
Venezuela, Chile, Philippines & Malaysia.
The company is also poised to make inroads into
global vaccine markets by deploying specialized
team for its Vaccine Business in emerging (ROW)
markets. The Company has started establishing its
ground work in various potential vaccine markets &
also obtained registration in Nepal & Pakistan. The
Company is all set to launch GeneratioNext vaccines
in the emerging markets in years to come.
4. Total foreign exchange earned and used
(Rs. in million)
2008-09 2007-08
Foreign Exchange Earned
F.O.B. value of Exports 5,589.0 6,414.1
(including deemed export of
Rs.3,708.4 million (Previous
Year Rs.5,797.3 million))
R & D Services (Know-how) income
1.7
3.9
Interest on Exchange Earners’
Foreign Currency Deposits
-
0.6
Interest received on loan from 16.9
2.0
Joint Venture Company
Interest accrued but not due on
28.9
loan from subsidiary company
Total
5,636.5 6,420.6
Foreign Exchange Used
Raw Materials & Packing
4,571.3 2,743.0
Materials
Capital Goods
457.2
193.1
12.8
8.6
Know-how Fee
Royalty
0.0
0.3
Interest
206.2
59.4
Professional & Consultation Fees
54.7
29.8
Other Expenses
-Patents, Trade marks & 26.3
23.4
Product registration
-Advertising and Sales Promotion
5.3
33.2
-Printing & Stationary
0.1
3.3
-Commission on Sales
65.8
44.7
- Market Research
30.3
-Others
39.6
27.5
Total
5,469.6 3,166.3
New Delhi
30th July, 2009
Soshil Kumar Jain
Chairman
Annexure B
Statement pursuant to Section 217(2A) of the Companies Act, 1956 and the Companies (Particulars of Employees) Rules,
1975 and forming part of the Directors’ Report for the year ended 31st March, 2009.
S. Name
Designation and
Remuneration
Qualifications
Experience
No.
Nature of Duties
(Rs.)
(Years)
A.
Date of Age
Commencement (Yrs.)
of Employment
Persons employed throughout the Financial Year ended 31st March, 2009, who were in receipt of remuneration for the year in which the aggregate was not less than Rs.2,400,000.
1.
Mr. Soshil Kumar Jain
Chairman
17,673,850 Pharmacist
54
02.02.1984
76
2.
Mr. Ravinder Jain
Managing Director
21,770,429
Matriculate
29
15.11.1984
52
3.
Dr. Rajesh Jain
14,688,440
B. Sc., PGDBM &
25
15.11.1984
45
Advanced Mgmt. Diploma
in Market Research, Ph.D.
4.
Mr. Sandeep Jain
14,688,440
B. Com
24
15.11.1984
43
5.
Mr. Sumit Jain
Director - Operations & Projects
3,520,582
B. Com, MBA
6
16.05.2003
28
6.
Mr. Narayan B. Gad
Chief Executive
7,950,003
B. Sc, D. Pharma, MBA
33
26.10.2005
58
Formulations (Marketing)
7. Dr. V.K. Vinayak
President BRC- (R&D)
3,735,453
Ph.D., M. Sc, FICAI,
38
01.10.2005
66
FRSTMH (London)
8.
Dr. Sanjay Trehan
Sr. Vice President -
6,535,395
Ph.D., M.Sc. (H)
21
01.07.2004
50
Drug Discovery Research
Mr. R.K. Suri
Sr. V.P. - New Initiative
3,409,552
M.Sc. (Hons)
31
12.11.2007
54
9.
10. Dr. M. Sitaram Kumar
5,589,053
M. Sc, Ph.D. 33
17.06.2005
59
Vice President -
Drug Discovery Research
11. Mr. Kallol Chakraborty Vice President (HR)
4,746,091
PG Dip. In Pers. Mgmt., LLB
19
19.11.2007
45
12. Mr. Sukhjeet Singh
Vice President (R&D)
4,136,027
Post Graduate
15
17.08.2006
40
13. Dr. Ashok Panwar
Vice President - Quality &
3,999,329
M. Sc., Ph.D. 15
01.05.2001
41
Compliance
14. Mr. Kulvinder Sarao
V.P. - Audit & Compliance (HR)
3,967,750
PGDPMIR 24
14.01.2005
47
15. Dr. Arani Chatterjee
V.P. - Clinical Research
3,942,092
MBBS, M. Phil.
18
24.07.2004
41
16. Mr. Sunil K. Bajaj
Vice President - Sales & Mkg.
3,688,850
B.Sc. 29
15.09.2004
48
17. Mr. Ganesh R. Kumraj
Vice President Bio. Oper. 3,529,921
Post Graduate
21
15.01.1992
42
18. Dr. Jagattaran Das
G.M. (R&D)
3,397,241
M.Sc., Ph.D. 15
01.07.2005
45
19. Ms. Neeta S. Sanghi
Head-Value India Healthcare 4,038,198
B.Sc. (Hons)
24
01.06.2007
50
20. Mr. Syed Sadir Ahmed Head - International
3,424,243
B Pharma, MBA
15
14.01.2006
39
Vaccine Business
B.Com
21. Mr. Karunakar J. Shetty Head of Operations-India
4,963,887
24
01.01.2006
50
(Marketing)
B.
Particulars of Last Employment
Name of Employer, Designation,
Period of Service (Years)
None, NA, NA
None, NA, NA
None, NA, NA
None, NA, NA
None, NA, NA
Nicholas Piramal India Ltd.
President Mktg. & Org. Dev., 4 years
Dept. of Biotechnology, Govt. of India,
Sr. Advisor, 11 years
Dr. Reddy’s Laboratories Ltd.,
Research Director, 3 years
Sanofi Aventis, Sr. Dir.-Bus. Effect., 9 years
Dr. Reddy’s Laboratories Ltd.
Sr. Director, 4.5 years
Federal Mogul Goetze (India) Ltd.
Director HR, 8 months
Strides Acrolabs Ltd., VP - Formulations
& Development, 1 year
Dishman Pharmaceuticals & Chemicals
Ltd., AGM-Q.C., 2 years
Hero Honda Motors Ltd, DGM-HR, 5 Mths
Dr. Reddy’s Labs Ltd., Principal Physician, 6 yrs.
Novartis India Ltd., NSM, 20 years
National Facility for Animal Tissue & Cell,
DGM, 3 years
Dr. Reddy’s Labs Ltd., Sr. Scientist, 6 years
Nicholas Piramal (I) Ltd. V.P. Dom. Form.
Supply Chain, 11 years
Nicholas Piramal India Ltd.., GM. S&M,
2 years
Nicholas Piramal India Ltd.
President Mktg. & Org. Dev., 4.5 years
Persons employed for a part of the Financial Year ended 31st March, 2009, who were in receipt of remuneration for any part of the year, at the rate which in the aggregate
was not less than Rs.200,000 per month.
22. Dr. Lallan Giri
President & Chief Operating
7,752,060
B.S., M.S., Ph.D.
26
01.07.2008
63
Officer
23. Mr. S. C. Marwah
CEO - Healthcare Venture
3,248,822
MBBS, Dip. Av. PGADHM, MBA
38
16.06.2008
62
24. Mr. Partha Sarathi De
C.F.O and Head IT & BPR
4,702,177
B.Sc. (Econ.), ACA, AICWA
21
02.06.2008
47
V.P. - Tech Mgmt Group
2,284,676
M.Tech, Ph.D.
23
02.06.2008
48
25. Dr. Goutam Ghosh
26. Dr. Sanjiv Sharma
Vice President-Regulatory
3,389,186
Ph.D. Org. Chem.
20
30.06.2008
43
Affairs
27. Mr. Abhay N. Lonkar
Country Head - India
3,940,026
B.Sc., MMS
20
11.06.2008
49
28. Dr. S. Mahender Rao
Vice President-CRD
1,323,978
Ph.D. - Doctor of Philosophy
13
08.12.2008
43
29. Dr. Amarjit Singh
President R&D
1,920,275
M. Pharma, Ph.D.
29
01.03.2005
51
30. Mr. Mahesh Shrihari
Head - Strategy
1,786,861
B.Pharma, MMS
17
01.07.2008
38
Kalsekar
31. Mr. Govind Pandey
V.P.- Pharma Operations
1,728,805
M.Pharma
18
10.05.2007
42
Head Sales & Marketing
32. Mr. S. Anuj Readdy
1,616,563
MBA
12
02.05.2007
36
33. Dr. Anil Chawla
Vice President (R&D)
1,540,021
Ph.D.
22
15.01.1992
41
Oshiva Enterprise LLC, USA. CEO/ M.D.,
3 years
Fortis Health Care Ltd., Head Medical Edu. &
Facility Planning, 4.5 Months
Gujarat Glass Ltd., President Finance
Glass Group, 2.5 years
The Pearey Lal Group, CEO., 1 year
Orchid Chemicals & Pharma Ltd., VP-RA.,
4 years
Unichem Labs Ltd., VP, 5 years
Orchid Chemicals & Pharma Ltd.,
Vice President, 4.5 years
Sun Pharmaceutical Industries Ltd., CSO &
EVP (R&D), 2 years
ORG - IMS Research Pvt. Ltd.,
Manager- Engagement, 11.5 years
Alkem Labs Ltd, VP Operations, 2 years
Novo Nordisk Pharma India Ltd.,
Mktg. Dir., 10 years
Bharat Immunological & Biological
Corporation Ltd., DGM, 4.5 years
34. Mr. Maheshh Jain
Jubilant Organosys Ltd., GM Accounts,
4.5 years.
G.M. - Accounts, Finance, 391,523
CA, CS
20
04.12.2007
45
Budget & Cost
Notes:
1. Remuneration includes salary, commission on profits, house rent allowance, bonus, Company’s contribution to Provident Fund, Leave Travel Allowance, Medical Assistance and all allowances
paid in cash and monetary value of taxable perquisites wherever applicable and also includes Gratuity/ Retirement Benefit.
2. There was no employee who was employed either throughout the financial year or part thereof, who was holding either by himself or along with the spouse and dependent children 2% or
more of the Shares of the Company and drawing remuneration in excess of the remuneration drawn by Managing Director / Joint Managing Director / Whole-time Director.
3. The terms and conditions of employees at Sl. No. 1 to 5 are as approved by the Board of Directors and Shareholders. The employees at Sl. No. 6 to 34 are paid remuneration as per the policy/
rules of the Company.
4. All the above said appointments are contractual.
5. None of the above employees is related to any of the Directors except that Mr. Soshil Kumar Jain, Mr. Ravinder Jain, Dr. Rajesh Jain, Mr. Sandeep Jain and Mr. Sumit Jain are related to each
other.
6. The nature of duties of Chairman, Managing Director and Joint Managing Directors is as under: Mr. Soshil Kumar Jain, Chairman - Strategic planning, vision and formulation of strategies.
Mr. Ravinder Jain, Managing Director - Overall supervision of day-to-day operations with emphasis on strategic planning and business development. Dr. Rajesh Jain, Joint Managing Director
- Overall supervision of day-to-day operations with emphasis on R&D, business development and marketing. Mr. Sandeep Jain, Joint Managing Director - Overall supervision of day-to-day
operations with emphasis on finance, international marketing and regulatory affairs.
New Delhi
30th July, 2009
Soshil Kumar Jain
Chairman
52
Report on Corporate Governance
1. Philosophy on Corporate Governance
The Company’s philosophy on Corporate Governance originates from its belief that attainment of the highest
levels of transparency, disclosure, financial controls, accountability and equity are the pillars of any good system of
corporate governance. Panacea Biotec is committed to continuously evolving and adopting corporate governance’s
best practices in all facets of its operations and in all interactions with its stakeholders including shareholders,
employees, consumers, lenders and the community at large.
At Panacea Biotec, good Corporate Governance process includes independence, integrity, commitment to values,
ethical business conduct and a high degree of transparency directing the intellectual capabilities and moral
authority of its independent Board that go a long way in preserving stakeholders trust while maximizing longterm corporate values.
2. Board of Directors
Composition & size of the Board
Panacea Biotec’s Board consists of an optimal combination of Executive Directors and Independent Non-executive
Directors which represents a mix of professionalism, thorough knowledge and experience.
The Directors bring in expertise in the fields of human resource development, strategy, management, finance
and economics among others. The Board provides leadership, strategic guidance, objective and independent
view to the Company’s management while discharging its fiduciary responsibilities, thereby ensuring that the
management adheres to high standards of ethics, transparency and disclosure.
At present, the Board comprise of 5 (Five) Executive Directors and 6 (Six) Non-Executive Directors. All the Executive
Directors are promoter-directors (1 Executive Chairman, 1 Managing Director, 2 Joint Managing Directors and 1
Whole-time Director).The non-executive Directors bring external and wider perspective in the Board’s deliberations
and decisions. The size and composition of the Board exceeds the requirements of the Clause 49 of the Listing
Agreement (Corporate Governance Guidelines) with the Stock Exchanges.
Board Functioning & Procedure
Panacea Biotec’s board is committed to ensuring good governance. Its style of functioning is self-governing. The
members of the Board always have complete liberty to express their opinion and decisions are taken on the basis
of consensus arrived at after detailed discussion. They are also free to bring up any matter for discussion at the
Board Meetings.
Panacea Biotec’s Board meets at least once in every quarter to discuss and review the quarterly results and other
items of agenda including the information required to be placed before the Board as required under Annexure
1A of Clause 49 of Listing Agreement and additional meetings are held as and when required. Dates for the Board
Meetings are decided well in advance and communicated to the Directors. The Chairman of the Board and the
Company Secretary discuss the items to be included in the agenda and the agenda is sent in advance to the
Directors along with the draft of relevant documents and explanatory notes.
During the financial year 2008-09, 5 (Five) Board Meetings were held on 30th April, 2008, 26th June, 2008, 28th
July, 2008, 31st October, 2008 (which was originally called on 17th October, 2008 but was adjourned due to lack of
quorum) and 29th January 2009.
Attendance of Directors at the Board Meetings & last Annual General Meeting and number of other
Directorships & Committee membership as on 31st March, 2009
Sl. Name of Director
Category of No. of
No. of Attendance
No. of other Directorships$ No.
Directorship
Board
Board
at last
& Committee Memberships/
Meetings Meetings
AGM
Chairmanships*
held attended
Other
Committee Committee
Directorships Memberships Chairmanships
1. Mr. Soshil Kumar Jain
2. Mr. Ravinder Jain
3. Dr. Rajesh Jain
4. Mr. Sandeep Jain
5. Mr. Sumit Jain
6. Mr. Sunil Kapoor
7. Mr. R.L. Narasimhan
8. Mr. N.N. Khamitkar
9. Mr. Gurmeet Singh
10. Mr. K.M. Lal
11. Dr. A.N. Saksena
Promoter – WTD Chairman
Promoter – MD Promoter –JMD Promoter –JMD Promoter –WTD Non–Executive–ID - do -
- do -
- do -
- do -
- do -
5
5
No
1
-
-
5
5
5
5
5
5
5
5
5
5
4
3
4
3
5
4
5
0
4
5
No
No
Yes
No
Yes
Yes
Yes
Yes
No
Yes
3
-
1
1
6
1
1
-
7
-
1
-
-
-
-
-
-
-
5
-
Nil
Nil
-
Note: WTD = Whole-time Director, MD = Managing Director, JMD = Joint Managing Director, ID = Independent Director.
$ Excludes directorships in Private Limited Companies, Foreign Companies, membership of managing committees of various chambers/bodies/
section 25 companies.
* Membership in Audit and Shareholders’ Grievance Committees.
53
None of the Directors on the Board is a member in more than ten committees and/or acts as chairman of more
than five committees across all the companies in which he is a Director.
Brief information on Directors proposed for re-appointment
The brief resume, experience and other details pertaining to the Directors seeking appointment / re-appointment
in the ensuing Annual General Meeting, to be provided in terms of Clause 49 of the Listing Agreement with the
Stock Exchanges, are furnished below:
a) Mr. R.L. Narasimhan
Age
: 68 Years
Qualification
: Post Graduate degree in Science from Madras University
Professional Expertise : He retired as the Deputy Director General, Central Statistical Organization, to the
Government’s Ministry of Statistics & Programme Implementation in New Delhi
and has held various senior and middle level positions in various Government
ministries. Prior to his positions with the Government, Mr. R.L. Narasimhan
has also worked with Hoechst Pharmaceuticals Ltd., Chennai, a multinational
pharmaceutical company. His expertise lies in the field of budgeting, data
management, programme evaluation & research and marketing.
Directorships
: He is a director of Best On Health Ltd.
Shareholding in : Nil
the Company
b) Mr. N.N. Khamitkar
Age
: 68 Years
Qualification
: B.E. – Electrical and Mechanical (Pune University), MBA (University of District
of Columbia, Washington DC, USA) and Post Graduate Diploma in Public
Administration, Indian Institute of Public Administration.
Professional Expertise : He is a retired Govt. Official belonging to Indian Engineering Service and retired as
Dy. Director General, Ministry of Home Affairs, Govt. of India, New Delhi.
He has held various senior and middle level positions in various Govt. Ministries
and Offices before his retirement. His expertise lies in the field of administration,
planning & procurement.
Directorships
: He is a director of Best On Health Limited.
the Company
c) Mr. Sunil Kapoor
Age
: 52 Years
Qualification
: Commerce graduate from Shri Ram College of Commerce, University of Delhi and
holds a LL.B. degree from Law Faculty, University of Delhi.
Professional Expertise : He practices as an advocate and is a member of the Delhi High Court Bar
Association and Bar Association Income Tax, New Delhi.
Directorships
: He is a director of Golden Peakock Overseas Ltd., Stross Crystals Ltd., Residency
Resorts Pvt. Ltd., Indo-dan Lamp Shade Ltd., GPL Exports Ltd, Hitkari Industries
Ltd., Best On Health Ltd., Residency Hospitality Services (P) Ltd., Reis Magos Fort
Restors (Pvt.) Ltd. and Raihl Estate (Pvt.) Ltd.
the Company
Information supplied to the Board
In addition to the regular business items, the Company provides the following information to the Board and Board
Committees as and when required. Such information is submitted either as part of the agenda papers in advance
of the meetings or by way of presentations and discussions material during the meetings:
1. Annual operating plans and budgets and any updates.
2. Capital budgets and any updates.
3. Quarterly results for the company and its operating divisions or business segments.
4. Minutes of meetings of audit committee and other committees of the Board.
5. The information on recruitment and remuneration of senior officers just below the Board level, including
appointment or removal of Chief Financial Officer and the Company Secretary.
6. Show cause, demand, prosecution notices and penalty notices which are materially important.
7. Fatal or serious accidents, dangerous occurrences, any material effluent or pollution problems.
8. Any material default in financial obligations to and by the company, or substantial non-payment for goods
sold by the company.
54
9.
Any issue, which involves possible public or product liability claims of substantial nature, including any
judgement or order which, may have passed strictures on the conduct of the company or taken an adverse
view regarding another enterprise that can have negative implications on the company.
10. Details of any joint venture or collaboration agreement.
11. Transactions that involve substantial payment towards goodwill, brand equity or intellectual property.
12. Significant labour problems and their proposed solutions. Any significant development in Human Resources/
Industrial Relations front like signing of wage agreement, implementation of Voluntary Retirement Scheme,
etc.
13. Sale of material nature of investments, subsidiaries, assets, which is not in normal course of business.
14. Quarterly details of foreign exchange exposures and the steps taken by management to limit the risks of
adverse exchange rate movement, if material.
15. Non-compliance of any regulatory, statutory or listing requirements and shareholders service such as nonpayment of dividend, delay in share transfer etc., if any.
Statutory Compliance of Laws
The Board periodically reviews the compliance report of the laws applicable to the Company as well as steps taken
by the Company to rectify the instances of non-compliances, if any.
Code of Conduct
The Board has laid down a code of conduct for all Board Members and senior management of the Company. The
said Code has been communicated to the Directors and Senior Management Personnel and is also posted on the
web-site of the company viz. www.panaceabiotec.com.
Declaration from the Managing Director confirming that the Company has received affirmations from the Board
Members and the Senior Management Personnel regarding compliance of Code of conduct during the year under
review, is attached as Annexure-I.
3. Audit Committee
Composition & Terms of Reference
The Audit Committee of the Company has been constituted as per Section 292A of the Companies Act, 1956 and
the guidelines set out in the Listing Agreements with the Stock Exchanges. The Audit Committee of the Company
comprises of three non-executive directors, all of them being independent Directors viz. Mr. R.L. Narasimhan, Mr.
N.N. Khamitkar and Mr. Sunil Kapoor. Mr. R.L. Narasimhan is the Chairman of the Committee. All the members are
financially literate and one member is having requisite accounting and financial management expertise.
The management is responsible for the Company’s internal controls and the financial reporting process while the
statutory auditors are responsible for performing independent audits of the Company’s financial statements in
accordance with generally accepted auditing practices and for issuing reports based on such audits. The Board of
Directors has entrusted the Audit Committee to supervise these processes and thus ensure accurate and timely
disclosures that maintain the transparency, integrity and quality of financial control and reporting.
The terms of reference and scope of the activities of the Audit Committee is as set out in Clause 49 of the Listing
Agreements with the Stock Exchanges as well as in Section 292A of the Companies Act, 1956, including the
following:
• To review compliance with internal control systems;
• To review the findings of the Internal Auditor relating to various functions of the Company;
• To hold periodic discussions with the Statutory Auditors and Internal Auditors of the Company concerning the
accounts of the Company, internal control systems, scope of audit and observations of the Auditors/Internal
Auditors;
• To review the quarterly, half-yearly and annual financial results of the Company before submission to the
Board;
• To make recommendations to the Board on any matter relating to the financial management of the Company,
including Statutory & Internal Audit Reports;
• Recommending the appointment of statutory auditors and internal auditors and fixation of their
remuneration.
Review of information by Audit Committee
Apart from other matters, as per Clause 49 of the Listing Agreement the Audit Committee reviewed, to the extent
applicable, the following information:
i) Management discussion and analysis of financial condition and results of operations;
ii) Statement of significant transactions, submitted by the Management;
iii) Management letters/letters of internal control weakness issued by statutory auditors;
iv) Internal Audit Reports relating to internal control weakness;
v) The appointment, removal and terms of remuneration of the Internal Auditors;
vi) Related party transactions.
Meetings of Audit Committee and attendance of members during the year
During the year, 5 (five) Audit Committee meetings were held on 29th April, 2008, 25th June, 2008, 28th July, 2008,
16th October, 2008 and 28th January, 2009.
55
The attendance of members of the Audit Committee at these meetings were as follows:
Sl. Name of the Member
Designation
Category of Directorship
No.
1. Mr. R. L. Narasimhan
Chairman
Independent Director
2. Mr. N. N. Khamitkar
Member
3. Mr. Sunil Kapoor
Member
No. of
Meetings
held
5
5
5
No. of
Meetings
attended
5
5
5
The Statutory Auditors, Internal Auditors, Cost Auditors, Chief Financial Officer, DGM (Accounts & Finance), AGM
(Finance), AGM Audit & Compliances are the permanent invitees of the meetings of Audit Committee. Apart from
them, Joint Managing Director(s), Director (Operations and Projects), Associate Director, General Manager (HR), V.P.
(HR), V.P. Audit & Compliance (HR) etc. attended one or more of the Audit Committee Meetings.
The Company Secretary is acting as the Secretary to the Audit Committee.
The Chairman of the Audit Committee, Mr. R.L. Narasimhan, was present at the Annual General Meeting of the
Company held on 27.09.2008.
Subsidiary Companies
During the year, the Company’s wholly owned subsidiary, Best On Health Limited acquired the status of a material
non-listed Indian subsidiary of the Company as its net worth (i.e. paid-up capital and free reserves) exceeded
20% of the consolidated net worth of the Company and its subsidiaries in the immediately preceding accounting
year i.e. financial year 2007-08. The Company’s independent Directors, Mr. R.L. Narasimhan, Mr. N.N. Khamitkar and
Mr. Sunil Kapoor are directors on the Board of Directors of Best on Health Limited w.e.f. 1st January 2008.
The Audit Committee of the Company reviewed the financial statements, in particular, the investments made by all
unlisted subsidiary companies except the financial statements of two of its subsidiaries namely Kelisia Investment
Holdings AG & Panacea Biotec (International) SA as the first financial year of these companies will end on 31st
March 2010.
The Board minutes of unlisted subsidiary companies are placed at the Board Meeting of the Company and the
significant transactions or arrangements entered into by the unlisted subsidiary companies are periodically
informed to the Board.
4. Remuneration Committee
Brief description of terms of reference
The Company has constituted a Remuneration Committee. The terms of reference of the Committee include:
-
-
to decide elements of remuneration package of all the directors;
to decide the service contracts, notice period and severance fees of executive directors.
Composition
Remuneration Committee comprises of three non-executive independent Directors viz. Mr. R.L. Narasimhan,
Mr. N.N. Khamitkar and Mr. Sunil Kapoor, Mr. R.L. Narasimhan is the Chairman of the Committee.
The Company Secretary is acting as the Secretary to the Remuneration Committee.
No meeting of the Remuneration Committee was held during the year.
Remuneration Policy
The Directors’ Remuneration Policy of your Company is in conformity with the provisions under the Companies Act,
1956. Subject to the approval of the Company’s shareholders in general meeting and such other approvals as may
be necessary, the Managing/Joint Managing Directors and the Whole-time Directors are paid remuneration as per
the terms of remuneration decided by the Board/ Remuneration Committee and approved by the Shareholders.
The remuneration payable to the executive Directors is decided from time to time keeping in view the overall
performance of the Company, the performance of the concerned Director and the industry trends.
The key components of the Company’s Remuneration Policy are:
• Compensation will be a major driver of performance.
• Compensation will be competitive and benchmarked with a select group of companies from the pharmaceutical
sector.
• Compensation will be fully transparent and tax compliant.
Directors’ remuneration
In view of the loss incurred by the Company for the financial year ended 31st March 2009, the Company has
applied to the Central Government for protection of the remuneration paid for the financial year 2008-09 to
Mr. Soshil Kumar Jain, Chairman, Mr. Ravinder Jain, Managing Director, Dr. Rajesh Jain, Joint Managing Director
and Mr. Sandeep Jain, Joint Managing Director and the approval is awaited. The details of the remuneration of
Executive Directors for the year ended 31st March, 2009 are as under:
56
i) Executive Directors (Managing/Joint Managing/Whole-time Directors)
S. No. Name Salary Allowances
Perquisites
1.
144.00
6.46
1.09
2.
Mr. Ravinder Jain
144.00
6.46
42.76
3.
Dr. Rajesh Jain
120.00
5.38
1.10
4.
Mr. Sandeep Jain
120.00
5.38
1.10
5.
Mr. Sumit Jain
27.00
1.21
4.75
(Rs. in Lac)
Total
151.55
193.22
126.48
126.48
32.96
Notes:
1.
The tenure of office of Mr. Soshil Kumar Jain, Chairman, Mr. Ravinder Jain, Managing Director, Dr. Rajesh Jain and Mr. Sandeep Jain, Joint
Managing Directors of the Company is for 5 years w.e.f.1st April, 2006.The tenure of office of Mr. Sumit Jain, Director (Operations and
Projects) is for 5 years w.e.f. 22nd July, 2005.
2.
Notice period for termination of appointment of Managing/Joint Managing/ Whole time Directors is three months by either party or a
shorter period decided mutually. No severance fee is payable on termination of contract.
3.
The Company does not have any Stock Option Scheme.
4.
All elements of remuneration of the Managing/Joint Managing/ Whole-time Directors, i.e., Salary, Perquisites and other benefits, etc. are
given in Schedule XX C annexed to and forming part of Balance Sheet and Profit & Loss Account of the Company.
5.
Provision for Gratuity and Leave Encashment amounting to Rs.60.08 Lac and Rs.32.64 Lac respectively, made during the year, has not
been included above.
ii) Non-Executive Directors
Payment Criteria:
The Board of Directors determines the remuneration of the non-executive Directors within the limits approved
by the shareholders. Apart from the sitting fees for attending meetings of the Board or Committee thereof,
the remuneration is paid to the non-executive Directors (other than Mr. Gurmeet Singh) by way of monthly
allowances for telephone, mobile, conveyance expenses, etc. @ Rs.15,500 p.m. (with the confirmation obtained
from Central Government) to enable them to meet their expenses for attending to their responsibilities as
non-executive director. As approved by the Board in their Meeting held on 31st October 2008, the sitting
fees payable to the Independent Directors of the Company for attending meetings of the Board and Audit
Committee was increased to Rs.10,000 per meeting from Rs.5,000 payable earlier for meetings held on or after
1st November 2008. Such increase is within the statutory limits prescribed under rule 10-B of the Companies
(Central Govt.’s) General Rules & Forms, 1956.
The details of remuneration paid to the non-executive directors during financial year ended 31st March, 2009
are as under:
(Rs. in Lac)
Sl. No.
Name
Allowances
Sitting Fees
Total
1
Mr. R.L. Narasimhan
1.86
0.60
2.46
2.
Mr. N.N. Khamitkar
1.86
0.65
2.51
3.
Mr. Sunil kapoor
1.86
0.60
2.46
4.
Mr. Gurmeet Singh
-
0.50
0.50
5.
Mr. K.M. Lal
1.86
0.20
2.06
6.
Dr. A.N. Saksena
1.86
0.90
2.76
None of the non-executive Directors hold any shares/ convertible securities of the Company.
5. Share Transfer cum Investors’ Grievance Committee
The Investors Grievance Committee aims at redressal of shareholder complaints and overseeing investor services.
The Board of Directors of the company has, with a view to expedite the process of share transfers, delegated the
power of share transfer to the Company Secretary who attends to share transfer formalities on weekly basis.
Terms of reference
The terms of reference of Share Transfer cum Investors’ Grievance Committee include transfer or transmission of
shares, dematerialisation of shares, issue of duplicate share certificates, review or redressal of investors’ grievances
and other areas of investor service.
Composition
The Share Transfer-cum-Investors’ Grievance Committee comprises of three Directors viz. Dr. A.N. Saksena,
Mr. Ravinder Jain and Mr. Gurmeet Singh. Dr A.N. Saksena, an independent non-executive Director acts as Chairman
of the Committee.
The Company Secretary is acting as the Secretary to the Committee as well as the Compliance Officer pursuant to
Clause 47(a) of the Listing Agreement with Stock Exchanges:
Designation
Category of Directorship
Sl. Name of the Member
No.
1. Dr. A. N. Saksena
Chairman
2. Mr. Ravinder Jain
Member
Promoter Director
3. Mr. Gurmeet Singh
Member
57
No. of
Meetings
held
12
12
12
No. of
Meetings
attended
12
9
10
Details of investors’ complaints received during the year 2008-09:
Sl. No. Nature of Complaints
Received
Resolved
Pending
1.
Non-receipt of Dividend
2
2
0
Warrants in respect of Shares
2.
Non-receipt of share certificate(s) lodged
4
4
0
for transfer/sub-division/duplicate etc.
3.
Total
6
6
0
The Company put utmost priority to the satisfaction of its shareholders which is evident from the fact that only
very few complaints were received by the Company. The Company addresses all complaints, suggestions and
grievances expeditiously and replies have been sent/issues have been resolved expeditiously except in case of
dispute over facts or other legal constraints.
There were no share transfers lying pending as on 31st March, 2009.
6. CEO/CFO Certification
The Managing Director and DGM (Accounts & Finance) have certified in terms of revised clause 49 of the Listing
Agreement to the Board that the financial statements present a true and fair view of the Company’s affair and are
in compliance with existing accounting standards.
The CEO and CFO certification of the financial statements and the cash flow statement for the year is enclosed as
Annexure – II to this report.
7. General Body Meetings
The last three Annual General Meetings were held as under:
Financial
Date
Time
Venue
Special Resolutions passed
Year
2007-08 27.09.08 11:00 AM Regd. Office at Ambala-
No Special Resolution was passed.
Chandigarh Highway,
Lalru 140501, Punjab.
2006-07 29.09.07 10:30 AM
- do -
• Approval for promotion of Mr. Shagun Jain, as Deputy General
Manager Systems and increase in remuneration w.e.f. 1st April
2007 under section 314 of the Companies Act, 1956(“Act”).
• Approval for promotion of Mrs. Radhika Jain as Sr. Manager w.e.f
1st April 2007 under section 314 of the Act.
• Approval for increase in remuneration to Ms. Shilpy Jain, as
Manager- Food & Beverages, under section 314 of the Act.
12.00
- do -
• Approval for payment of remuneration to Dr. Aditya Narain
2005-06 30.09.06
Noon Saksena, non-executive independent Director.
• Approval for payment of monthly remuneration to Non-Executive
Directors.
• Re-appointment of Mr. Soshil Kumar Jain as Whole-Time Director
designated as Chairman.
• Appointment of Mr. Ashwani Jain as Associated Director
(Corporate Affairs) w.e.f. 1st October, 2006.
• Appointment of Mr. Shagun Jain as Manager Systems w.e.f. 1st
October, 2006.
• Approval for appointment of Ms. Radhika Jain as Scientific Officer
w.e.f. 2nd June, 2006.
• Approval for appointment of Ms. Shilpy Jain as Manager Food &
Beverages w.e.f. 1st August, 2006.
Postal Ballot
During the year, the Company had conducted voting through two Postal Ballots on 14th July 2008 & 27th September
2008 respectively. The Company complied with the procedures for the postal ballot in terms of the Companies
(Passing of Resolution by Postal Ballot) Rules, 2001 and the amendments thereto. Mr. Umesh Singhal of M/s U.S. &
Associates, Company Secretaries acted as scrutinizer for first Postal Ballot whose results were announced on 14th
July 2008 and voting pattern of the same was as under:
S. Item
No.
1
Special Resolution under Section 17 of the Companies Act, 1956 seeking
members consent for alteration in the object clause by way of inserting
new sub-clauses 39, 40 and 41 after the existing sub-clause 38 of Clause III-C
(Other Objects);
2
Special Resolution under Section 149(2A) seeking members’ consent for commencement of business as specified in the said sub-clauses 39, 40 and
41 of Clause III-C (Other Objects).
58
Votes cast
For
Against
34,607,503
1,783
34,595,863
1,783
Mr. U. K. Singhal of M/s Singhal Law Associates, Advocates acted as scrutinizer for second postal ballot and the results
of the same were announced on 27th September, 2008 and voting pattern for the resolutions was as under:
S. Item
No.
Votes cast
For
Against
1
Ordinary Resolution under Section 293(1)(d) of the Companies Act ,1956 for 34,247,228
increase in borrowing powers of Board upto Rs.1500 Crore;
1,720
2
Ordinary Resolution under Section 293(1)(a) of the Companies Act, 1956 authorizing the Board of Directors to mortgage and/or charge/hypothecate
any of its movable and/or immovable properties or the whole or
substantially the whole of an undertaking or undertakings of the Company.
3,720
34,240,774
Thus, all the resolutions were passed with overwhelming majority.
Procedure for voting by Postal Ballot:
The Postal Ballot Forms and the draft Resolution(s) along with the Explanatory Statement pertaining the said
Resolution(s) explaining in detail the material facts and the self-addressed, postage prepaid envelope, are sent to
all the members, under Certificate of Posting.
The members are required to carefully read the instructions printed in the Postal Ballot Form, give their assent or
dissent on the resolution(s) at the end of the Form and sign the same as per the specimen signatures available with
the Company or Depository Participant, as the case may be, and return the form duly completed in the attached
self-addressed postage prepaid envelope so as to reach the scrutinizer before the close of working hours of the
last date fixed for the purpose. Postal Ballot Forms received after this date are strictly treated as if the form has not
received from the member.
The scrutinizer appointed for the purpose scrutinizes the postal ballots received and submit his report to the
Company.
Voting rights are reckoned on the basis of number of shares and paid-up value of shares registered in the name of
the shareholders as on the date of dispatch of the postal ballot notice. A resolution is deemed to have been passed
as special resolution if the votes cast in favour are at least three times than the votes cast against and in case of
ordinary resolution, the resolution is deemed to have been passed, if votes cast in favour are more than the votes
cast against.
8. Disclosure
a) Related Party Transactions – During the year, there were no materially significant related party transactions
with the promoters, the directors or the management, their subsidiaries or relatives, etc. that may have potential
conflict with the interests of the Company at large. The other related party transactions are given in Note No.9
of Schedule XXC annexed to and forming part of Balance Sheet and Profit & Loss Account of the Company.
b) Disclosure of Accounting Treatment - There has not been any change in accounting policies of the Company
during the year except as stated in Note No.2 of Schedule XXB annexed to and forming part of Balance Sheet
and Profit & Loss Account of the Company.
c) Risk Management - The Company has a procedure to inform the Board about the risk assessment and
minimization procedures. The Board of Directors periodically reviews the risk management framework of the
Company.
d) Compliances by the Company - During the last three years, there were no strictures or penalties imposed by
either SEBI or the Stock Exchanges or any other statutory authority for non-compliance of any matter related
to the capital markets.
e) The Company has complied with all the mandatory requirements of clause 49 of the listing Agreement. As
regards, the adoption of non-mandatory requirements as contained in Annexure I-D to clause 49 of the listing
agreement, the Company has implemented the requirements as per details give below:
i) Chairman of the Board - The Chairman of Panacea Biotec is an Executive Director and he maintains the
Chairman’s Office at the Company’s expenses.
ii) Remuneration Committee - The Board of Directors has constituted a Remuneration Committee, which is
composed of independent Directors. The details of the Remuneration Committee and its powers have
already been discussed in this Report.
iii) Shareholders rights - The quarterly/ half-yearly results, after they are approved by the Board of Directors,
are sent forthwith to the Stock Exchanges where the Company’s shares are listed, published in the
newspapers as mentioned under the heading “Means of Communication” at Sl. No. 10 hereinbelow
and also displayed on the Company’s web-site www.panaceabiotec.com. The results are not separately
circulated to the shareholders.
iv) Training of Board Members - No specific training programme was arranged for Board members. However,
59
at the Board/Committee meetings detailed presentations are made by Professionals, Consultants as well
as Senior Executives of the Company on the business related matters, risk assessment, strategy, effect of
the regulatory changes, etc.
v) Mechanism for evaluating non-executive Board members - The Company has not adopted any mechanism
for evaluating individual performance of Non- Executive Directors.
vi) Whistle Blower Policy - The Company has implemented a Whistle Blower Policy in the Company and no
personnel is denied access to the Audit Committee of the Company.
9. Prohibition of Insider Trading
In compliance with the SEBI Regulations on Prevention of Insider Trading, the Company has instituted a
comprehensive Code of Conduct for its management, staff and relevant business associates. The Code lays down
guidelines, which advises them on procedures to be followed and disclosures to be made, while dealing with
Shares of the Company.
10. Means of communication
1. The Quarterly and Half-Yearly results are published in one or more of the prominent daily newspapers, viz.
Business Line and Business Standard, All editions, Hindustan Times, New Delhi, Chandigarh, Lucknow, Kolkata,
Patna, Ranchi and Bhopal; DNA Money, Mumbai; Financial Express, Delhi, Mumbai and in Punjabi Tribune,
Chandigarh, the local newspaper published in the language of the region in which Registered Office is
situated.
2. The Company also intimate the Stock Exchanges all price sensitive matters or such matters which in its opinion
are material and of relevance to the shareholders and subsequently issues a Press Release on the matter,
wherever necessary.
3. The Annual Results (Annual Report containing Balance Sheet etc.) are posted to every shareholder of the
Company.
4. The Company’s web-site, viz. www.panaceabiotec.com, is regularly updated with the financial results, annual
report and other important events.
5. Pursuant to clause 51 of the listing agreement, financial information like annual and quarterly financial
statements, segment-wise results, shareholding pattern(s) and annual report(s) are made available on the
SEBI’s web-site www.sebiedifar.nic.in.
6. Management’s Discussion and Analysis Report has been included in the Annual Report being sent to the
shareholders of the Company.
11. General Shareholder Information
i) Date of AGM
The Annual General Meeting is proposed to be held on Friday, the 25th day of September, 2009, at 11:00 A.M.
at the registered office of the Company at Ambala-Chandigarh Highway, Lalru - 140 501, Punjab.
Posting of Annual Report
On or before 1st September, 2009
Last date of receipt of Proxy Form 23rd September, 2009 before 11.00 A.M.
ii) Financial Calendar 2009-10 (tentative)
S. No.
1.
2.
3.
4.
5.
Tentative Schedule
Financial reporting for the quarter ended 30th June, 2009
Financial reporting for the half year ending 30th September, 2009
Financial reporting for the quarter ending 31st December, 2009
Financial reporting for the quarter ending 31st March, 2009
Annual General Meeting for the year ending 31st March, 2010
Tentative Date
30th July, 2009 (Actual)
End of October, 2009
End of January, 2010
End of April, 2010*
End of September, 2010
*As provided in clause 41 of Listing Agreement, Board may also consider publishing Audited Results for the year 2009-10 in lieu of
Unaudited Results for fourth quarter, by 30th June, 2010 (or such other period as may be stipulated from time to time).
iii) Date of Book Closure
The Share Transfer Books and Register of Members of the Company will remain closed from Wednesday, 23rd
September, 2009 to Friday, 25th September, 2009 (both days inclusive).
iv) No Dividend
In view of non-availability of profits during the current financial year, the Board of Directors has not
recommended any dividend on the Equity Shares of the Company.
v) Unclaimed Dividends
As provided in Section 205A and 205C of the Companies Act, 1956, dividend for the financial year ended 31st
March, 2002 and thereafter, which remain unpaid or unclaimed for a period of 7 years, will be transferred to the
60
Investor Education and Protection Fund (IEP Fund) established by the Central Government and no payments
shall be made in respect of any such claims by the IEP Fund.
During the year, the Company had transferred Rs.143,640 lying unclaimed in Unpaid Dividend Account in
respect of Dividend for the Year 2000-2001 to the said Fund on 18th October, 2008.
Information in respect of other unclaimed dividend when due for transfer to the said Fund is given below:
Financial Year
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
Date of declaration
of Dividend
Last date for claiming
unpaid Dividend
Due date for
transfer to IEP Fund
24.08.2002
20.09.2003
18.09.2004
20.08.2005
30.09.2006
29.09.2007
27.09.2008
21.09.2009
18.10.2010
16.10.2011
17.09.2012
29.10.2013
28.10.2014
26.10.2015
20.10.2009
16.11.2010
14.11.2011
16.10.2012
28.11.2013
27.11.2014
25.11.2015
Shareholders who have not yet encashed their dividend warrant(s) for the above said financial year(s) may
send their request for revalidation of Dividend Warrant(s) or issue of duplicate Dividend Warrant(s), as the case
may be, to the Company’s Corporate Office immediately. Shareholders are requested to note that no claims
shall lie against the Company or the said Fund in respect of any amounts, which were unclaimed or unpaid for
a period of 7 years from the dates on which they first became due for payment and no payment shall be made
in respect of any such claims.
vi) Listing on Stock Exchange
The Company’s Equity Shares are listed on the following Stock Exchanges:
• National Stock Exchange of India Ltd. (NSE), Bandra Kurla Complex, Bandra (E), Mumbai.
• Bombay Stock Exchange Ltd. (BSE), P J Tower, Dalal Street, Fort, Mumbai.
The Foreign Currency Convertible Bonds (FCCBs) of the Company are listed on Singapore Exchange Ltd. (SGX),
2 Shenton Way, #19-00 SGX Centre 1, Singapore 068804, under the BONDS Sector.
The Company has paid listing fees to all the above stock exchanges and there is no outstanding payment as
on date.
vii) Stock Code of Equity Shares / FCCBs
Trade symbol at National Stock Exchange is PANACEABIO.
Stock Code at Bombay Stock Exchange is 531349.
ISIN No. for Dematerialisation : INE922B01023.
Stock Code of FCCBs : XS0243888830
61
Panacea Biotec • Annual
Panacea
ReportBiotec
2008-09
• Annual Report 2008-09
viii)Market Price data:
The High and Low prices of the shares of the Company at Bombay Stock Exchange Limited (BSE) and National
Stock Exchange of India Ltd. (NSE) for the year ended 31st March, 2009 are as under:
Month
Share Prices (Rs.) at BSE
Share Prices (Rs.) at NSE
High Low
High
Low
April,2008
405.00
340.05
400.00
330.05
May, 2008
413.00
345.00
412.00
368.00
June, 2008
392.00
292.00
395.60
295.00
July, 2008
363.40
273.05
363.60
270.25
August, 2008
340.00
247.50
365.00
269.00
September, 2008
308.50
214.50
310.00
216.10
October, 2008
249.00
144.00
248.50
141.00
November, 2008
197.00
123.20
198.00
123.45
December, 2008
151.00
126.00
147.00
124.20
January,2009
138.95
51.95
139.50
51.70
Februray,2009
77.20
51.00
78.40
50.00
March,2009
62.10
52.00
62.30
51.10
ix) Registrar and Transfer Agents
Skyline Financial Services Pvt. Ltd., are acting as Registrar & Transfer Agents (RTA) for handling the shares
related matters both in physical as well as dematerialised mode. All works relating to Equity Shares are being
done by them. The Shareholders are therefore, advised to send all their correspondence to the RTA.
However, for the convenience of shareholders, documents relating to shares received by the Company are
forwarded to the RTA for necessary action thereon.
x) Nomination Facility
The shareholders holding shares in physical form may, if they so want, send their nominations in prescribed
Form 2B of the Companies (Central Government’s) General Rules and Forms, 1956, (which can be either
obtained from the Company’s RTA or downloaded from the Company’s website www.panaceabiotec.com
under the section ‘Investor Zone’) to the Company’s RTA. Those holding shares in dematerialised form may
contact their respective Depository Participant (DP) to avail the nomination facility.
xi) Share Certificates in respect of sub-divided Shares
After the sub-division of the Company’s Equity Shares of Rs.10 each into shares of Re.1 each, in the year 2003,
the Company had sent letters to all shareholders holding shares of the face value of Rs.10 in physical form,
requesting them to exchange their share certificates into new share certificate(s) in respect of shares of face
value of Re.1 each.
All the shareholders who have not yet sent their request for exchange of share certificates, are requested
to forward their old share certificates in respect of shares of face value of Rs.10 each (which are no longer
tradable) to the Company, along with a request letter duly signed by all the joint holders.
xii) Elimination of Duplicate Mailing
The shareholders who are holding Shares in more than one folio in identical name or in joint holders’ name in
similar order, may send the share certificate(s) along with request for consolidation of holding in one folio to
avoid mailing of multiple Annual Reports.
xiii)Share Transfer System
The Company’s shares transfer authority has been delegated to the Company Secretary. The delegated
authority generally attends the share transfer formalities on weekly basis and as and when required to expedite
all matters relating to transfer, transmission, transposition and dematerialisation of shares and redressal of
Investors’ grievance, etc., if any. The shares received by the Company/ RTA for registration of transfers, are
processed by RTA (generally within a week of receipt) and transferred expeditiously and the Share Certificate(s)
are returned to the shareholder(s) by registered post.
62
As per the requirement of clause 47 (c) of the Listing Agreement with the Stock Exchanges, the Company
has obtained the half yearly certificates from a Company Secretary in Practice for due compliance of share
transfer/ consolidation/ exchange formalities.
The Securities and Exchange Board of India (SEBI) vide circular ref. no. MRD/DoP/Cir-05/2009 dated 20th May,
2009 directed that for securities market transactions and off-market/private transactions involving transfer of
shares in physical form of listed companies, it shall be mandatory for the transferee(s) to furnish copy of PAN
card to the Company/ RTA for registration of such transfer of shares.
xiv)Secretarial Audit
A Practising Company Secretary carries out secretarial audit in each of the quarter to reconcile the total
admitted capital with National Securities Depository Limited (NSDL) and Central Depository Services (India)
Ltd. (CDSL) and total issued and listed capital. The audit reports confirm that the total issued/ paid up capital is
in agreement with the total number of shares in physical form and the total number of dematerialised shares
held with NSDL and CDSL. The Secretarial Audit Reports for each quarter of the Financial Year ended March 31,
2009 has been filed with Stock Exchanges within one month of end of each quarter.
xv) Dematerialisation of Shares and its liquidity
The Company has been among the few top-most companies in India in which maximum number of shares
have been dematerialised. As on 31st March, 2009, 99.05% of the Company’s total Equity Share Capital
representing 66,204,985 Equity Shares were held in dematerialised form and only 637,761 Equity Shares were
in paper/physical form.
The shareholders holding shares in physical form are requested to get their shares dematerialised at the
earliest, as the Company’s Shares are required to be compulsorily traded at Stock Exchanges in dematerialised
form only.
The shares of the Company are regularly traded at the National Stock Exchange and the Bombay Stock
Exchange.
xvi)Share Dematerialisation System
The requests for dematerialisation of shares are processed by RTA expeditiously and the confirmation in
respect of dematerialisation of shares is entered by RTA in the depository system of the respective depositories,
by way of electronic entries for dematerialisation of shares generally on weekly basis. In case of rejections, the
documents are returned under objection to the Depository Participant with a copy to the shareholder and
electronic entry for rejection is made by RTA in the Depository System.
xvii) Distribution of Shareholding as on 31st March, 2009
No. of Shares
No. of Shareholders
0-2500
2501-5000
5001-10000
10001-100000
100001 and above
Total
8,190
111
29
42
39
8,411
No. of Shares
2,021,221
407,293
215,713
1,323,499 62,875,020
66,842,746
xviii) Pattern of Shareholding as on 31st March, 2009
S. No. Category
1.
Promoters, Relatives &
Associates
2.
Institutional Investors (FIIs,
Banks & Mutual Funds)
3.
Domestic Companies
4.
Indian Public
5.
NRIs / OCBs / Foreign
Corporate Bodies
6.
Others
Total
63
No. of Shares
%
45,451,699
68.00
11,554,491
17.29
5,403,079
2,876,080
1,527,450
8.08
4.30
2.29
29,947
0.04
66,842,746 100.00
Shareholding Pattern
xix)GDRs / ADRs / Warrants or other convertible instruments
No GDRs/ADRs/Warrants were outstanding as on 31st March, 2009. However, Foreign Currency Convertible
Bonds (FCCBs) (US$ 50,000,000 Zero coupon Convertible Bonds due 2011) aggregating US$ 36.8 million
(Rs.1,866,496,000) were outstanding as on 31st March, 2009.
xx) Plant Locations
•
Bulk Vaccine facilities at Village Samalheri, Ambala-Chandigarh Highway,Lalru-140 501, Punjab.
•
Pharmaceutical Formulations facility at Malpur, Baddi, Dist. Solan, Himachal Pradesh-173 205.
•
Vaccines Formulations facility at Malpur, Baddi, Dist. Solan, Himachal Pradesh-173 205.
•
Vaccines Formulations facility at A-241/242, Okhla Indl. Area, Phase I, New Delhi - 110 020.
•
Pharmaceutical Formulations facility at B-1/E-12, Mohan Co-operative Indl. Estate, Mathura Road, New
Delhi - 110 044.
xxi)Address for correspondence
For transfer/ dematerialisation of shares,
payment of dividend and any
other query relating to shares
For investors assistance
Skyline Financial Services Pvt. Ltd.
246, Sant Nagar, 1st Floor, ISKCON Temple Road,
East of Kailash, New Delhi – 110 065, India.
Phone
: +91-11-26292681-84
Tele-fax : +91-11- 26292681
E-mail
: [email protected], [email protected]
The Company Secretary
Panacea Biotec Limited
B-1 Extn./G-3, Mohan Co-operative Indl. Estate, Mathura Road,
New Delhi - 110 044, India.
Phone :
Fax
:
E-mail
:
+91-11-41679000 Extn. 2081 (D) 41578024
+91-11-41679075, 41679070
[email protected]
[email protected]
Contact Person : Mr. Vinod Goel, G.M. Legal & Company Secretary/
Ms. Sangeeta Nagpal, Deputy Manager-Secretarial.
For query relating to
:
financial matters
Phone
:
Fax
:
E-mail
:
Mr. Chandresh Ohri
Manager - Banking & Treasury
+91-11-41679000
+91-11-41679066, 41679070
[email protected]
Place: New Delhi
Date : 30th July, 2009
Soshil Kumar Jain
Chairman
Annexure - I
Declaration under Clause 49-I (D) of the Listing Agreement
To
The Members of Panacea Biotec Ltd.
I hereby declare that all the Board Members and the Senior Management Personnel of the Company have affirmed the
compliance with the provisions of the Code of Conduct for the period ended 31st March, 2009.
For Panacea Biotec Ltd.
Date : 27th May, 2009 Place : New Delhi
Ravinder Jain
Managing Director
64
Annexure - II
Certificate from Managing Director & Chief Financial Officer
To
The Board of Directors
Panacea Biotec Limited
We do hereby confirm and certify that:
(a) We have reviewed financial statements and the cash flow statement for the year and that to the best of our knowledge
and belief:
i)
These statements do not contain any materially untrue statement or omit any material fact or contain statements
that might be misleading;
ii)
These statements together present a true and fair view of the company’s affairs and are in compliance with existing
accounting standards, applicable laws and regulations.
(b) There are, to the best of our knowledge and belief, no transactions entered into by the company during the year which
are fraudulent, illegal or violative of the company’s code of conduct.
(c) We accept responsibility for establishing and maintaining internal controls and that we have evaluated the effectiveness of
the internal control systems of the company and we have disclosed to the auditors and the Audit Committee, deficiencies
in the design or operation of internal controls, if any, of which we are aware of and the steps we have taken or propose to
take to rectify these deficiencies.
(d) We have indicated to the auditors and the Audit committee:
i)
significant changes in internal control during the year;
ii)
significant changes in accounting policies during the year and that the same have been disclosed in the notes to the
financial statements; and
iii) instances of significant fraud of which we are aware and the involvement therein, if any, of the management or an
employee having a significant role in the company’s internal control system.
Date : 27th May, 2009
Place : New Delhi
For Panacea Biotec Ltd.
Ravinder Jain
I.K. Sharma
Managing Director DGM (Accounts & Finance)
AUDITORS’ CERTIFICATE
To
The Members of Panacea Biotec Limited
We have examined the compliance of conditions of Corporate Governance by Panacea Biotec Limited, for the year ended on
31st March 2009, as stipulated in clause 49 of the Listing Agreement of the said Company with stock exchange(s).
The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited
to procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of the
Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.
In our opinion and to the best of our information and according to the explanations given to us, we certify that the Company
has complied with the conditions of Corporate Governance as stipulated in the above-mentioned Listing Agreement.
We state that no investor’s grievance is pending for a period exceeding one month against the Company as per the records
maintained by the Shareholders/ Investors’ Grievance Committee.
We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or
effectiveness with which the management has conducted the affairs of the Company.
Dass Gupta & Associates
Chartered Accountants
Per
Raaja Jindal
Partner
Membership No. 504111
Place : New Delhi
Date : 30th July, 2009
65
AUDITORS’ REPORT
To the Members of Panacea Biotec Limited
1. We have audited the attached balance sheet of Panacea Biotec
Limited (“the Company”) as at March 31, 2009 and also the
profit and loss account and the cash flow statement for the year
ended on that date annexed thereto. These financial statements
are the responsibility of the Company’s management. Our
responsibility is to express an opinion on these financial
statements based on our audit.
2. We conducted our audit in accordance with auditing standards
generally accepted in India. Those Standards require that we
plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the
accounting principles used and significant estimates made
by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
3. As required by the Companies (Auditors’ Report) Order, 2003
(as amended) issued by the Central Government of India in
terms of sub-section (4A) of Section 227 of the Companies Act,
1956, we enclose in the Annexure a statement on the matters
specified in paragraphs 4 and 5 of the said Order.
4. Without qualifying our opinion, we draw attention to:
a) Note 3(ii) of Schedule XXC to the financial statements
regarding non-provision of proportionate premium on
redemption of ‘US$ 50 Million Zero Coupon Convertible
Bonds due 2011’ amounting to Rs.470,992,269. The same
has been disclosed as a contingent liability. Management
has represented, that the redemption premium will be
offset against the securities premium account and, hence,
no adjustments have been considered in the accounts.
b) Note 17 of Schedule XXC to the financial statements
regarding capitalization of expenditure on clinical trials
amounting to Rs.123,978,449. The ultimate approval of
such products, which has been considered as highly likely
by the management, is not within direct control of the
Company. Pending such final approval, no adjustments
have been made to the accompanying financial
statements.
c) Note 5(b) of Schedule XXC to the financial statements,
The Company has incurred managerial remuneration of
Rs.63,035,463 during the year, which is in excess of the
limits specified by the relevant provisions of the Companies
Act, 1956, by Rs.38,169,706. The Company has made an
application to the appropriate regulatory authorities in
this regard, for payment of such excess remuneration to
managerial personnel. Pending the final outcome of the
Company’s application, no adjustments have been made
to the accompanying financial statements in this regard.
5. Further to our comments in the annexure referred to in para 3
above, we report that: i)
we have obtained all the information and explanations
which, to the best of our knowledge and belief, were
necessary for the purposes of our audit;
ii) in our opinion, proper books of account as required by
law, have been kept by the Company, so far as appears
from our examination of the books;
iii) The balance sheet, profit and loss account and cash flow
statement dealt with by this report are in agreement with
the books of account;
iv) in our opinion, the balance sheet, profit and loss account
and cash flow statement dealt with by this report, comply
with the accounting standards referred to in sub-section
(3C) of section 211 of the Companies Act, 1956;
v) on the basis of written representations received from the
66
vi)
directors, as on March 31, 2009, and taken on record by the
Board of Directors, we report that none of the directors is
disqualified as on March 31, 2009 from being appointed
as a director in terms of clause (g) of sub-section (1) of
section 274 of the Companies Act, 1956;
In our opinion and to the best of our information and
according to the explanations given to us, the said
accounts give the information required by the Companies
Act, 1956, in the manner so required and give a true and
fair view in conformity with the accounting principles
generally accepted in India:
a) in the case of the balance sheet, of the state of the
affairs of the Company as at March 31, 2009;
b) in the case of the profit and loss account, of the loss
for the year ended on that date; and
c) in the case of the cash flow statement, of the cash
flows for the year ended on that date.
For S.R. Batliboi & Co.
New Delhi
May 27, 2009
per Manoj Gupta
Partner
Annexure referred to in paragraph [3] of our report of even date,
Re: Panacea Biotec Limited
i)
a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of
fixed assets.
b) All fixed assets have not been physically verified by the
management during the year but there is a regular
program of verification, which in our opinion, is reasonable
having regard to the size of the Company and the nature
of its assets. As informed, no material discrepancies were
noticed in respect of the fixed assets physically verified
during the year.
c) There was no substantial disposal of fixed assets during
the year.
ii) a) The management has conducted physical verification of
inventory at reasonable intervals during the year.
b) The procedures of physical verification of inventory
followed by the management are reasonable and
adequate in relation to the size of the Company and the
nature of its business.
c) The Company is maintaining proper records of inventory
and no material discrepancies were noticed on physical
verification.
iii) a) The Company has granted loan to three companies
covered in the register maintained under section 301
of the Companies Act, 1956. The maximum amount
involved during the year was Rs.819,644,921 and the
year-end balance of loans granted to such parties was
Rs.819,644,921.
b) In our opinion and according to the information and
explanations given to us, the rate of interest and other
terms and conditions for such loans are not prima facie
prejudicial to the interest of the Company.
c) The loans granted are re-payable on demand. As informed,
the company has not demanded repayment of any such
loan during the year, thus, there has been no default on
the part of the parties to whom the money has been lent.
The payment of interest (whenever due) for loans has
been regular.
d) There is no overdue amount of loans granted to companies,
firms or other parties listed in the register maintained
under section 301 of the Companies Act, 1956.
e) The Company has taken loan from one partnership
ANNEXURE TO THE AUDITORS’ REPORT
firm covered in the register maintained under Section
301 of the Companies Act, 1956. The maximum amount
involved during the year was Rs.533,428,059 and the
year-end balance of loans taken from such parties was
Rs.300,000,000.
f ) In our opinion and according to the information and
explanations given to us, the rate of interest and other
terms and conditions for such loans are not prima facie
prejudicial to the interest of the Company.
g) In respect of loans taken, repayment of the principal
amount is as stipulated and payment of interest has been
regular.
iv) In our opinion and according to the information and
explanations given to us, there is an adequate internal control
system commensurate with the size of the Company and the
nature of its business, for the purchase of inventory and fixed
assets and for the sale of goods and services. During the course
of our audit, no major weakness has been noticed in the internal
control system in respect of these areas.
v) a) According to the information and explanations provided
by the management, we are of the opinion that the
particulars of contracts or arrangements referred to in
section 301 of the Act that need to be entered into the
register maintained under section 301 have been so
entered.
b) In our opinion and according to the information and
explanations given to us, the transactions made in
pursuance of such contracts or arrangements exceeding
value of Rupees five lakhs have been entered into during
the financial year at prices which are reasonable having
regard to the prevailing market prices at the relevant
time.
vi) In respect of deposits accepted, in our opinion and according to
the information and explanations given to us, directives issued
by the Reserve Bank of India and the provisions of sections 58A,
58AA or any other relevant provisions of the Companies Act,
1956 and the rules framed there under, to the extent applicable,
have been complied with. We are informed by the management
that no order has been passed by the Company Law Board,
National Company Law Tribunal or Reserve Bank of India or any
Court or any other Tribunal.
vii) In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
viii) We have broadly reviewed the books of account maintained
by the Company pursuant to the rules made by the Central
Government for the maintenance of cost records under section
209(1)(d) of the Companies Act, 1956, and are of the opinion
that prima facie, the prescribed accounts and records have
been made and maintained.
ix) a) Undisputed statutory dues including provident fund,
investor education and protection fund, employees’
state insurance, income-tax, sales-tax, wealth-tax, service
tax, custom duty, excise duty, cess have generally been
regularly deposited with the appropriate authorities
except for slight delay in few cases, where amount involved
is not significant, in the depositing of Value added tax (VAT),
employees’ state insurance and service tax.
b) According to the information and explanations given to
us there are no undisputed amounts payable in respect
of provident fund, investor education and protection
fund, employees’ state insurance, income-tax, wealth-tax,
service tax, sales-tax, customs duty, excise duty, cess and
other undisputed statutory dues were outstanding, at the
year end, for a period of more than six months from the
date they became payable.
c) According to the records of the Company, the dues
67
outstanding of income-tax, sales-tax, wealth-tax, service
tax, customs duty, excise duty and cess on account of any
dispute, are as follows:
Name of
Nature
Amount (Rs.)
Period to
the statute
of dues
which the
amount relates
Income Tax
Act, 1961
Income Tax
Act, 1961
The Finance
Act, 1994
Demand raised by 50,000
Assessment
Assessing Officer
Year 2005-06
Demand raised by 60,557
Assessment
Assessing Officer
Year 2006-07
Demand raised by 29,789,842
Financial Year
Assessing Officer
2003-04 to 2007-08
Forum where
dispute
is pending
Appeal pending
with CIT (Appeals)
Appeal pending
with CIT (Appeals)
Pending with
Assessing Officer
x)
The Company has no accumulated losses at the end of the
financial year and it has not incurred cash losses in the current
and immediately preceding financial year.
xi) Based on our audit procedures and as per the information and
explanations given by the management, we are of the opinion
that the Company has not defaulted in repayment of dues to a
financial institution, bank or debenture holders.
xii) According to the information and explanations given to us
and based on the documents and records produced to us, the
Company has not granted loans and advances on the basis
of security by way of pledge of shares, debentures and other
securities.
xiii) In our opinion, the Company is not a chit fund or a nidhi/ mutual
benefit fund / society. Therefore, the provisions of clause 4(xiii)
of the Order are not applicable to the Company.
xiv) In our opinion, the Company is not dealing in or trading in shares,
securities, debentures and other investments. Accordingly, the
provisions of clause 4(xiv) of the Companies (Auditor’s Report)
Order, 2003 (as amended) are not applicable to the Company.
xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others
from banks or financial institutions.
xvi) Based on information and explanations given to us by the
management, term loans were applied for the purpose for
which the loans were obtained.
xvii) According to the information and explanations given to us
and on overall examination of the balance sheet and cash flow
statement of the Company, we report that no funds raised on
short-term basis have been used for long term investments.
xviii) The Company has not made any preferential allotment of shares
to parties or companies covered in the register maintained
under Section 301 of the Companies Act, 1956.
xix) The Company has unsecured ‘Zero Coupon Convertible Bonds
due 2011’ outstanding during the year on which no security or
charge is required to be created.
xx) We have verified that the end use of money raised by public
issues is as disclosed in the notes to the financial statements
(Refer Note 3(iii) of Schedule XXC to Financial Statements).
xxi) Based upon the audit procedures performed for the purpose
of reporting the true and fair view of the financial statements
and as per the information and explanations given by the
management, we report that no fraud on or by the Company
has been noticed or reported during the course of our audit.
For S.R. Batliboi & Co.
New Delhi
May 27, 2009
per Manoj Gupta
Partner
BALANCE SHEET AS AT 31st MARCH, 2009
Schedule
No.
As at
31st March, 2009
Amount in Rs.
As at
31st March, 2008
SOURCES OF FUNDS
1 Shareholders’ Funds
Share Capital
I
66,786,312
66,786,312
Reserves and Surplus II
6,084,706,629 6,151,492,941
6,905,260,347 6,972,046,659
2 Loan Funds
Secured Loans
III
4,835,939,044
2,070,352,415
Unsecured Loans
IV
2,166,996,000 7,002,935,044
1,912,075,828 3,982,428,243
3 Deferred Tax Liability (Net)
333,785,665
595,029,653
(Refer note no.7 of Schedule XXC)
Total 13,488,213,650 11,549,504,555
APPLICATION OF FUNDS
1 Fixed Assets
V
Gross Block
7,411,174,436
4,658,106,038
Less : Depreciation/Amortisation 2,170,081,361
1,476,040,319
Net Block
5,241,093,075
3,182,065,719
Capital Work-in-Progress (including Capital Advances)
1,697,610,032 6,938,703,107
2,161,628,242 5,343,693,961
2 Investments
VI 2,165,697,596 2,049,308,818
3 Foreign Currency Monetary item Translation 95,961,134
Difference Account (net of amortisation)
(Refer note no.2 of Schedule XXB and
note no.19 of Schedule XXC)
4 Current Assets, Loans & Advances
VII
Inventories
4,478,012,741
2,116,423,533
Sundry Debtors 1,238,801,509
1,482,608,423
Cash and Bank Balances 594,809,396
1,411,802,807
Other Current Assets 54,409,736
29,548,820
Loans and Advances 1,303,765,120
404,505,998
Sub-total (A)
7,669,798,502
5,444,889,581
Less : Current Liabilities and Provisions
VIII
Current Liabilities 1,528,090,478
1,077,957,657
Provisions
1,857,508,130
215,764,467
Sub-total (B)
3,385,598,608
1,293,722,124
Net Current Assets (A)-(B) 4,284,199,894 4,151,167,457
5 Miscellaneous Expenditure
IX
3,651,919
5,334,319
(To the extent not written off or adjusted)
Total 13,488,213,650 11,549,504,555
Significant Accounting Policies and Notes
XX
to Accounts
The Schedules referred to above and notes thereon form an integral part of the Balance Sheet.
As per our attached report of even date
S.R. Batliboi & Co.
Ravinder Jain
Managing Director
per Manoj Gupta
Partner
I.K. Sharma
Dr. Rajesh Jain
D.G.M. (Accounts & Finance)
Place : New Delhi
Dated: May 27, 2009
Vinod Goel
68
PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED ON 31st MARCH, 2009
Schedule
No.
Amount in Rs.
For the year ended
31st March, 2009
For the year ended
31st March, 2008
INCOME
Turnover (Gross)
Less: Excise Duty
X
7,753,017,108
37,756,574
8,304,442,378
Other Income
XI
259,677,471
371,741,692
Total
7,993,849,467
8,676,184,070
18,845,112
8,342,198,952
7,734,171,996
EXPENDITURE
Purchases of Traded Goods
Raw and packing material consumed
155,870,989
172,969,336
XII
2,951,977,608
3,463,719,981
Operating and other expenses
XIII
3,350,885,603
745,519,847
(Increase)/ Decrease in inventories
XIV
(446,904,922)
21,787,534
Personnel Expenses
XV
916,095,844
924,897,239
Selling and Distribution Expenses
XVI
434,544,751
451,093,211
Research and Development Expenses
XVII
669,944,045
541,856,120
Financial Expenses
XVIII
347,420,187
150,139,383
Depreciation/ Amortisation
V
536,073,835
298,660,739
IX
1,682,400
1,682,400
Total
8,917,590,340
6,772,325,790
Profit / (Loss) before tax
(923,740,873)
1,903,858,280
Provision for Income Tax
-
330,000,000
Deferred Income Tax (Credit)/ Charge
(Refer note no.7 of Schedule XXC)
(261,243,988)
211,160,506
Miscellaneous Expenditure written off
during the year
Provision for Fringe Benefit Tax
28,000,000
31,000,000
Profit / (Loss) after Tax
(690,496,885)
1,331,697,774
Add : Balance brought forward from previous year
2,845,720,793
1,725,221,144
Profit available for Appropriations
2,155,223,908
3,056,918,918
Equity Shares - Proposed (not liable to TDS)
-
66,693,746
Dividend Distribution Tax
-
11,334,602
-
133,169,777
Balance carried to Balance Sheet
2,155,223,908
2,845,720,793
APPROPRIATIONS
Dividend
Basic Earnings per Share
XIX
(10.35)
20.14
Diluted Earnings per Share
XIX
(10.35)
18.85
Face/ Nominal Value per Share
1.00
1.00
Significant Accounting Policies and Notes
to Accounts
XX
The Schedules referred to above and notes thereon form an integral part of the Profit & Loss Account.
S.R. Batliboi & Co.
Ravinder Jain
Managing Director
per Manoj Gupta
Partner
I.K. Sharma
Dr. Rajesh Jain
Place : New Delhi
Dated: May 27, 2009
69
Vinod Goel
SCHEDULES TO BALANCE SHEET AND PROFIT & LOSS ACCOUNT
As at
31st March, 2009
Amount in Rs.
As at
31st March, 2008
Schedule I - Share Capital
Authorised
Comprising of
i.
125,000,000 (Previous Year 125,000,000)
Equity Shares of Re.1 each
125,000,000
ii. 110,000,000 (Previous year 110,000,000)
Preference Shares of Rs.10 each 1,100,000,000
1,225,000,000
Issued and Subscribed
66,842,746 (Previous Year 66,842,746)
Equity Shares of Re.1 each
66,842,746
66,842,746
Paid up
66,693,746 (Previous Year 66,693,746) Equity Shares
of Re.1 each fully paid up
66,693,746
66,693,746
Add: Forfeited Shares
(14,900 Shares @ Rs.10 each forfeited on May 15, 1999,
which were later on sub-divided into 149,000 Equity
Shares of Re.1 each on February 12, 2003)
92,566
66,786,312
92,566
125,000,000
1,100,000,000
1,225,000,000
66,842,746
66,842,746
66,786,312
(149,000 Forfeited Shares have been allotted on 24th August, 2005 in the name of
employees of the Company (in their capacity as Company’s nominees/trustees) for sale
thereof at the prevailing market prices through recognised Stock Exchanges on the
terms & conditions as specified by Managing/ Joint Managing Directors or Director of
the Company and reimbursement of net sales proceeds to the company account)
(Out of the above shares, 1,814,240 Equity Shares of Rs.10 each were issued as fully paid up
bonus shares by capitalisation of General Reserves in earlier years, which were later on
sub-divided into 18,142,400 Equity Shares of Re.1 each on February 12, 2003)
66,786,312
66,786,312
Capital Redemption Reserve 1,016,849,140
Securities Premium
Amount as per last Balance Sheet
2,762,712,068
2,436,230,310
Add: Credited Upon Issue of Equity Shares on
- 2,762,712,068
326,481,758
conversion of FCCBs
General Reserve
279,978,346
146,808,569
Add: Transfer from Profit & Loss Account
-
133,169,777
Less: Exchange Differences of earlier years capitalised to 37,586,515
Fixed Assets (Net of Depreciation Rs.1,609,882) (Refer
note no. 2 of Schedule XXB and note no. 19 of
Schedule XXC)
Less: Exchange Differences of Earlier Years Transferred to 92,470,318
149,921,513
-
the “Foreign Currency Monetary Item Translation
Difference Account” (Refer note no. 2 of Schedule XXB
and note no. 19 of Schedule XXC)
Balance in Profit & Loss Account 2,155,223,908
6,084,706,629
1,016,849,140
Schedule II - Reserves and Surplus
70
2,762,712,068
279,978,346
2,845,720,793
6,905,260,347
As at
31st March, 2009
Amount in Rs.
As at
31st March, 2008
Schedule III - Secured Loans
1. Foreign Currency Term Loans (from Banks)
i) State Bank of India
(Due within one year Rs. nil (Previous Year Rs. nil))
Interest Accrued and Due
ii) State Bank of Travancore
2. Working Capital Loans from Scheduled Banks
2,028,800,000
802,100,000
12,416,668
1,272,932,614
4,974,265
1,006,525,285
1,521,789,762
4,835,939,044
256,752,865
2,070,352,415
Notes:
1.
Foreign Currency Term Loans from State Bank of India and State Bank of Travancore are secured by way of first pari-passu charge by hypothecation
of the Company’s entire movables fixed assets, both present and future and mortgage of immovable properties of the Company being land
admeasuring 96 bighas, 19 biswas & 93 bighas 12 biswas & 10 Biswasi situated at Village Samalheri, Tehsil Dera Bassi, District S.A.S. Nagar (Mohali)
(formerly Tehsil Rajpura, District Patiala), Punjab.The process for creation of first pari-passu charge by way of mortgage of immovable properties
situated at Baddi, Himanchal Pradesh is in progress. Foreign Currency Term Loans from State Bank of India is also collaterally secured by personal
guarantees of the Promoter-Directors of the Company, viz. Mr. Soshil Kumar Jain, Mr. Ravinder Jain, Dr. Rajesh Jain and Mr. Sandeep Jain.
2.
Working Capital Loans from Scheduled Banks are secured by way of first pari-passu charge by hypothecation of all current assets and also by way of
2nd pari-passu charge on all the movable fixed assets(including machinery and spares) of the company and existing immovable fixed assets of the
Company being land admeasuring 96 bighas, 19 biswas & 93 bighas 12 biswas & 10 Biswasi situated at Village Samalheri, Tehsil Dera Bassi, District
S.A.S. Nagar (Mohali) (formerly Tehsil Rajpura, District Patiala), Punjab. The process for creation of second pari-passu charge by way of mortgage
of immovable properties situated at Baddi, Himanchal Pradesh is in progress. These are also collaterally secured by personal guarantees of the
Promoter-Directors of the Company, viz. Mr. Soshil Kumar Jain, Mr. Ravinder Jain, Dr. Rajesh Jain and Mr. Sandeep Jain.
Schedule IV - Unsecured Loans
Fixed Deposits*
(Due within one year Rs.55,000,000
(Previous year Rs.432,500,000))
Interest accrued and due
Other Loans:
Foreign Currency Convertible Bonds**
US$ 36,800,000 (Previous Year US$ 36,800,000) Zero Coupon Convertible Bonds due 2011
300,500,000
436,110,000
-
101,828
1,866,496,000
1,475,864,000
2,166,996,000
1,912,075,828
Note:
71
*
includes Rs.300,000,000 (Previous Year Rs.432,500,000) from partnership firm in which some directors and their relatives are partner.
**
Unless previously converted, redeemed or repurchased & cancelled, the remaining FCCBs of US $ 36,800,000,which were issued on 13.02.2006, will
be redeemed on Feb 14, 2011 at 142.80% of their outstanding principal amount.
72
179,873,882
143,235,784
Office Equipments
Computer Equipments
76,076
-
7,062,586
98,188,498
65,137,502
58,610,449
101,858,862
24,392,965
19,191,198
19,119,952
33,141,324
787,197,238 459,044,577
64,283,501
195,401,781 116,147,313
371,417
(1,609,882)
(59,326)
(8,497)
(8,424)
(32,556)
(1,345,729)
(56)
(155,294)
-
-
-
122,410,114
84,268,914
72,260,310
135,028,371
1,241,031,086
71,346,031
311,371,615
832,615
44,496,052
120,718,374
66,551,612
152,856,871
2,997,640,222
7,136,913
1,422,343,997
53,999,615
293,490,945
15,900,440
28,561,405
77,328,159
9,202,695
44,680,076
184,829,374
Website
Product Development
TOTAL
3,030,790
-
21,789,294
9,202,695
54,118,990
46,421,326
38,791,222
-
31,285,734
11,781,518
-
184,829,374
79,971,960
24,929,330
3,826,563,078
846,612,518
15,069,558
-
4,658,106,038 1,053,334,196 430,008,915
7,411,174,436 1,476,040,319 705,099,242
1. Freehold Land includes Land amounting to Rs.17,285,690 (Previous Year Rs. 17,285,690) pending registration in the name of the Company.
2. Building includes Office Premises amounting to Rs. 155,892,400(Previous Year Rs. 1,429,032) pending registration in the name of the Company.
3. Plant & Machinery includes Plant & Machinery amounting to Rs.4,543,083 (Previous Year Rs.5,277,132 ) (Net Block) lying with third parties.
4. Depreciation for the year includes Depreciation on Research & Development Assets amounting to Rs.169,025,407 (Previous Year Rs.131,348,176).
5. Capital Work in Progress includes pre-operative expenditure. Refer Note No.4 of schedule XX C.
6. All Intangible assets (except Softwares) are internally generated Intangible assets.
* Includes Exchange Differences capitalized during the year Rs. 730, 764,477(Previous year Rs. NIL).
** Exchange differences Loss / (Gain) of earlier years capitalized during the year.
Notes:
PREVIOUS YEAR
(11,695,186)
-
7,302,792
9,448,318
-
-
(1,609,882)
104,901,290
79,928,084
1,476,040,319
3,182,065,719
1,697,610,032
-
44,791,888
-
-
-
-
-
Capital Work in Progress
44,442,369
2,809,555,472
(3,105)
-
-
(3,105)
1,371,139,029
5,241,093,075
TOTAL (A+B)
26,627,910
10,342,685
-
13,254,435
-
2,170,081,361
140,387,005
4,658,106,038
PREVIOUS YEAR
104,901,290
11,446,609
9,202,695
40,861,450
43,390,536
7,302,792
81,858,474
213,390,779
60,580,516
9,202,695
85,404,724
58,202,844
973,362,236 405,079,585
647,718,926
-
-
-
- -
4,473,276,664
131,532,305
-
-
-
-
-
15,069,558
Capital Work in Progress -
8,076,565
53,618,444
Softwares
4,584,400
802,170,149
Patents, Trademarks & Designs
B. Intangible Assets
3,686,176,073
3,102,137,635
9,451,423
112,023
51,289
5,461,667
(60,741)
3,865,000
-
22,185
-
-
As At
31/03/2009
1,049,891,106
7,197,783,657 1,371,139,029 678,471,332
166,906,166
204,987,288
138,811,922
287,885,242
-
461,198
As At
31/03/2009
PREVIOUS YEAR
(11,695,186)
(148,314)
(61,083)
(32,538)
(179,870)
4,238,671,308
78,482,944
1,733,715,612
54,832,230
293,490,945
Other
Movements**
44,791,888
196,666
-
8,429,476
(9,674,542)
(556)
(1,552,944)
-
(45,339)
Sale /
Adjustments
during the Year
(Amount in Rs.)
2,773,228,882
2,161,628,242
3,182,065,719
60,415,045
431,214,135
79,928,084
33,233,467
-
36,466,709
10,227,908
2,712,813,837
1,730,414,107
3,102,137,635
45,047,286
114,736,380
60,984,522
126,106,395
1,775,619,724
12,482,076
739,957,799
15,934,492
211,268,961
As At
31/03/2008
NET BLOCK
5,159,234,601
2,780,994,067
24,015,362
25,174,489
27,678,965
60,175,931
7,260,437
-
1,299,258
-
27,529,975
Provided
during
the Year
DEPRECIATION/AMORTISATION
2,038,549,056
4,473,276,664
119,594,971
TOTAL
227,965,257
Furniture & Fittings
Vehicles
1,692,789,325
1,717,923
76,765,577
Leasedhold Improvement
2,562,816,962
801,208,234
935,359,580
Buildings
Plant & Machinery
38,436,540
16,395,690
Land - Leasehold
109,797,298
211,268,961
Land - Freehold
A. Tangible Assets
Sale/Adjustment
Other
As At
As At
during
Movements** 31/03/2009
01/04/2008
the Year
As At
01/04/2008
Additions
during
the Year*
GROSS BLOCK
DESCRIPTION
Schedule V - Fixed Assets
As at
31st March, 2009
Amount in Rs.
As at
31st March, 2008
Schedule VI - Investments
Long Term Investments (at cost)
Trade - Unquoted
1) Subsidiary Companies : a) 1,902,160 (Previous Year 1,902,160) Equity Shares
of Re.1 each fully paid in Best On Health Ltd.
22,883,050
22,883,050
b) 6,636,666 (Previous Year 5,970,000),
0.5% Optionally Convertible Non-Cumulative
Redeemable Preference Shares of Re.1 each
fully paid in Best On Health Ltd.
1,990,999,800
1,791,000,000
c) 5 (Previous Year Nil) Equity Shares of AED
100,000 each fully paid in Panacea Biotec FZE.
5,474,520
d) 3,765,701(Previous Year Nil) Equity Shares of
Rs.10 each Rs.2.70 paid up in Umkal Medical
Institute Pvt. Ltd. 76,143,604
e) Investment in Equity Shares (Previous Year Nil)
of Panacea Biotec GmbH
1,582,250
f ) 1,000 (Previous Year Nil) Equity Shares of US $0.01
each fully paid up in Rees Investments Limited
476 2,097,083,700
-
2) Joint Venture Companies :
a) 2,295,910 (Previous Year 2,295,910) Equity Shares
of Rs.10 each fully paid up in
Chiron Panacea Vaccines Pvt. Ltd. 22,959,100
22,959,100
b) 4,608,608 (Previous Year 4,608,608) Ordinary
Shares of GBP 0.01 (Face Value) each fully paid
up in Cambridge Biostability Limited, U.K. 168,068,998
168,068,998
Less : Provision for Permanent Diminution in
the value of Investments [Refer note no.13 (e) of
Schedule XX C]
168,068,998
22,959,100
-
3) 419,767 (Previous Year 419,767) Equity Shares of
Rs.10 each fully paid in PanEra Biotec Pvt. Ltd.
4,197,670
(formerly known as Panheber Biotec Pvt. Ltd.)
4) 20,000 (Previous Year 20,000) Equity Shares of
Rs.10 each fully paid up in Shivalik Solid
200,000
Waste Management Ltd.
Non-Trade - Unquoted
1) Investment in Capital of Partnership Firm
-
Lakshmi & The Manager
2) 41,257,126 (Previous Year Nil) Equity Shares of Re.1
each fully paid up in Lakshmi & Manager Holdings Ltd*
41,257,126
2,165,697,596 1,813,883,050
191,028,098
4,197,670
200,000
40,000,000
2,049,308,818
*Company under the same management as defined under section 370 (1B) of the Companies Act, 1956
Notes:
1.
The aggregate amount of unquoted investments is Rs.2,165,697,596 (net of Provision for Permanent Diminution in the value of Investments of
Rs.168,068,998) (Previous year Rs.2,049,308,818).
2.
The Company has formed a new subsidiary Panacea Biotec Inc. in USA. Even though the subsidiary has been incorporated, no investment has yet
been made as on March 31, 2009.
3.
The names of all the partners of the Partnership Firm, ‘Lakshmi & The Manager’, total capital of the firm and the share of each partner was as under:
Partners
Capital
Sharing Ratio
Panacea Biotec Ltd. 40,000,000
40%
Mr. Ravinder Jain
19,000,000
19%
Mrs. Radhika Jain
20,000,000
20%
Mrs. Sunanda Jain
18,000,000
18%
Mrs. Meena Jain
2,000,000
2%
Mrs. Shilpy Jain
1,000,000
1%
Total
100,000,000
100%
73
As at
31st March, 2009
Amount in Rs.
As at
31st March, 2008
Schedule VII - Current Assets, Loans & Advances
Inventories
i) Raw Materials (including Packing Materials)
3,206,780,619
1,320,981,788
(Including lying with third parties Rs.34,062,940
(Previous Year Rs.57,098,748))
ii) Finished Goods
985,858,105
684,208,806
(Including goods in transit of Rs.1,192,568
(Previous Year Rs. Nil) & lying with third parties
Rs.844,654 (Previous Year Rs.187,528)
202,833,537
57,577,914
iii) Work in Progress (Including lying with third parties
Rs.67,135,348 (Previous Year Rs.9,268,214))
iv) Stores & Spare Parts
82,540,480 4,478,012,741
53,655,025
Sundry Debtors (Refer note no 8 (i) & (iii) of Schedule XX C)
(Unsecured, Considered good, unless otherwise stated) Over six months (including Rs.3,108,712 considered
doubtful of recovery (Previous year Rs.2,858,916))
83,409,270
9,572,864
1,158,500,951
1,475,894,475
Others Debts
1,241,910,221
1,485,467,339
Less : Provision for Bad & Doubtful Debts
3,108,712 1,238,801,509
2,858,916
Cash and Bank Balances
i) Cash balance on hand
579,589
1,449,297
ii) Balance with scheduled banks
a) On Current Accounts
25,557,539
33,723,242
b) On Unpaid Dividend Accounts*
1,583,956
1,536,608
c) On Fixed Deposits**
70,467,843
1,250,968,300
d) On Exchange Earner Foreign Currency 496,620,469
594,809,396
124,125,360
Current Accounts
2,116,423,533
1,482,608,423
1,411,802,807
*Not available for use by the company as they represent corresponding unpaid dividend liabilities
**Fixed Deposits amounting to Rs.1,024,123 (previous year Rs.968,300) are pledged with Banks and
various Government Authorities.
Other Current Assets
Export Benefits receivable
25,521,973
19,402,794
Interest accrued but not due on Loans & Deposits
36,163,233
10,146,026
Less : Provision for doubtful of recovery (Refer note no.13 (e) 7,275,470
54,409,736
-
of Schedule XX C))
Loans and Advances
(Unsecured, considered good, unless otherwise stated)
Advances recoverable in cash or in kind or for value to 116,431,593
103,463,997
be received (Including Rs.818,322 (Previous Year
Rs.818,322 ) considered doubtful))
153,950,194
135,532,654
Due from PanEra Biotec Pvt. Ltd. (Formerly known as
Panheber Biotec Private Ltd.) * (Including Rs.135,532,654
(Previous Year Rs.135,532,654) considered doubtful))
Balance with Excise, Custom etc.
15,027,362
24,870,402
Loans & Advances to Subsidiary Company **
710,811,071
Loan to Joint Venture Company
108,833,850
39,778,050
16,333,010
18,245,508
Staff Loans & Advances (including Rs.4,191,959 (Previous Year Rs.4,191,959) considered doubtful))
1,121,387,080
321,890,611
Less : Provision for Doubtful Loans & Advances (Refer note 108,833,850
no.13 (e) of Schedule XX C)
Less : Provision for Bad & Doubtful Advances
140,542,935
140,542,935
872,010,295
181,347,676
Security Deposits
20,534,409
21,892,190
Advance Income Tax (Net of Provision of Rs.1,168,500,000
411,220,416 1,303,765,120
201,266,132
(Previous year Rs.1,168,500,000))
7,669,798,502
29,548,820
404,505,998
5,444,889,581
*Company`s two Directors are also directors in PanEra Biotec Private Limited (Formerly Known as Panheber Biotec Pvt. Ltd.).
**Advances include due from Company under the Same Management (wholly owned subsidiary company) as defined under section 370(1B) of the Companies Act, 1956. Refer note no.8(i) & (ii) of Schedule XX C.
74
Amount in Rs.
As at
31st March, 2009
As at
31st March, 2008
Schedule VIII - Current Liabilities & Provisions
A. Liabilities
i) Acceptances
ii) Sundry Creditors
a) Dues to Micro & Small Enterprises
(Refer note no.6 of Schedule XX C)
b) Dues to other than Micro & Small Enterprises
iii) Payable to Subsidiary Company
iv) Advances from Customers
v) Deposits from C & F Agents
vi) Unpaid dividend on Equity Shares*
vii) Other Liabilities
viii) Interest accrued but not due on Loans / Deposits
1,115,093,540
336,979,264
1,274,843
1,177,455
358,326,378
202,620
5,367,817
15,195,000
1,585,056
31,002,816
42,408 1,528,090,478
631,043,756
3,079,105
7,595,465
15,158,000
1,536,608
81,388,004
-
1,077,957,657
B. Provisions
i) Provision for Wealth Tax
913,479
832,746
ii) Provision for Fringe Benefit Tax (Net of Advance 5,045,455
2,349,330
payment of Rs.100,954,545 (Previous year
Rs.75,650,670))
iii) Proposed Dividend on Equity Shares
-
66,693,746
iv) Provision for Dividend Distribution Tax
-
11,334,602
v) Provision for Gratuity
56,754,771
57,679,075
vi) Provision for Leave Encashment
51,690,425
36,374,968
vii) Provision for Open Derivative Contracts
1,743,104,000 1,857,508,130
40,500,000
3,385,598,608
215,764,467
1,293,722,124
* This amount does not include amount due/outstanding
to be credited to Investor Education & Protection Fund,
same shall be credited as and when due
Schedule IX - Miscellaneous Expenditure
i) License fees
As per last Balance Sheet
5,334,319
7,016,719
Less: Written off during the year
1,682,400
3,651,919
1,682,400
3,651,919
For the year ended
31st March, 2009
5,334,319
5,334,319
Amount in Rs.
For the year ended
31st March, 2008
Schedule X - Turnover
Sales 7,730,417,599
Services (R&D Income)
1,699,562
Income from Contract Manufacturing
20,899,947
7,753,017,108
75
8,338,331,922
3,867,030
8,342,198,952
For the year ended
31st March, 2009
Amount in Rs.
For the year ended
31st March, 2008
Schedule XI - Other Income
Interest received - from Banks (Tax deducted at source Rs.25,897,168 (Previous year Rs.8,955,419))
- from Inter Company Loans / Deposits (Tax deducted at
source Rs. Nil (Previous year Rs.226,646))
- on Income Tax Refund
- from others* (Tax deducted at source Rs. Nil (Previous year Rs. Nil))
Export Incentives
Miscellaneous Balances/ Provisions written back
Sale of Scrap
Lease Rent
Profit on Sale of Fixed Assets (Net of loss Rs.2,039,733
(Previous year Rs.770,491))
Foreign Exchange Fluctuation Gain (Net of loss Rs. Nil (Previous year Rs.125,552,613))
Profit on Sale of Long Term Trade Investments
Share of Profit From Partnership Firm, in which Company was Partner
Insurance Claim Received
Royalty Income
Dividend Received From Long Term Trade Investments (Joint Venture)
Miscellaneous Income
121,771,587
45,756,516
42,725,158
3,093,565
-
534,417
30,855,454
-
1,779,942
17,823,031
7,171,144
6,527,472
189,117
24,814,711
123,151,118
1,769,296
1,138,945
22,887,632
-
-
1,257,126
4,430,371
9,266,380
18,367,280
664,223
259,677,471
124,807,357
8,062,060
8,283,596
1,235,464
3,056,201
371,741,692
*Interest from others includes Rs.87,800 (Previous year Rs.64,500) from employees, Rs.188,248 (Previous year Rs.124,617) from debtors Rs.258,369(Previous year Rs. Nil) from Excise department.
Schedule XII - Raw & Packing Material Consumed
Raw & Packing Materials consumed
Opening Stock
1,320,981,788
1,256,131,191
Add : Material purchased during the year
4,857,397,558
3,561,460,905
6,178,379,346
4,817,592,096
Less : Closing Stock
3,206,780,619
1,320,981,788
2,971,598,727
3,496,610,308
Less: Material consumed for Research & Development
19,621,119
32,890,327
2,951,977,608
3,463,719,981
Schedule XIII - Operating and other Expenses
Processing Charges
35,289,443
Analytical Testing & Trial Charges
6,995,652
Stores & Spare Parts consumed (Refer note no.4 of Schedule XX C)
57,939,559
Power & Fuel (Refer note no.4 of Schedule XX C)
112,167,409
Repair & Maintenance (Refer note no.4 of Schedule XX C)
-Buildings
16,628,948
19,041,472
-Plant & Machinery
22,609,114
23,277,261
-Others
28,139,583
67,377,645
26,284,547
Rent (Refer note no.4 of Schedule XX C)
53,248,013
Royalty
14,742,764
Directors’ Sitting Fees
345,000
Printing & Stationery
40,206,382
Postage & Communication expenses
45,366,215
Insurance
41,379,420
Travelling & Conveyance expenses (Refer note no.4 of Schedule XX C)
103,288,987
Books & Periodicals
2,240,467
Legal & Professional charges (Refer note no.4 of Schedule XX C)
108,984,641
Vehicle Running & Maintenance
17,147,781
Auditors’ Remuneration: (Refer note no.14 of Schedule XX C)
-Statutory Audit Fee
3,309,000
3,400,060
-Limited Review Fees
1,685,400
1,348,320
-Out of pocket expenses
161,721
69,317
-Others
134,832
5,290,953
113,217
15,252,931
Rates & Taxes (Refer note no.4 of Schedule XX C)
Donation
3,408,970
Subscription
13,700,941
Staff Training & Recruitment
31,477,974
Bad Debts & Advances written off
72,285
116,494,114
Provision for Doubtful Debts & Advances
Wealth Tax
936,368
Foreign Exchange Fluctuation Loss {Net of Gain
557,888,608 Rs.214,791,328 (Previous year Rs. Nil)}
Provision for Loss on Open Derivative Contracts 1,702,604,000
Provision for Permanent Diminution in the value of 168,068,998
Investments (Refer note no.13 (e) of Schedule XX C))
Miscellaneous expenses (Refer note no.4 of Schedule XX C)
28,970,083
3,350,885,603
76
5,843,974
11,026,412
45,981,822
96,918,851
68,603,280
51,749,980
4,385,550
340,000
31,434,720
39,061,671
42,761,472
101,364,603
1,505,062
72,094,552
14,765,877
4,930,914
9,486,175
6,550,004
12,226,353
29,976,294
27,044,708
832,746
40,500,000
26,134,827
745,519,847
For the year ended
31st March, 2009
Amount in Rs.
For the year ended
31st March, 2008
Schedule XIV - (Increase)/ Decrease In Inventories
Closing Stock:
Finished Goods
985,858,105
684,208,806
Work in Progress
202,833,537 1,188,691,642
57,577,914
Less: Opening Stock
Finished Goods
684,208,806
713,506,988
Work in Progress
57,577,914
741,786,720
50,067,266
(446,904,922)
741,786,720
763,574,254
21,787,534
Schedule XV - Personnel Expenses
Salary, Wages and Bonus* (Refer note no.4 of Schedule XX C)
Contribution to Provident and other Funds
Workmen/Staff Welfare expenses
Gratuity
837,086,165
26,949,018
39,995,607
12,065,054
916,095,844
834,390,802
22,070,028
35,339,196
33,097,213
924,897,239
226,910,009
62,306,063
64,098,422
81,230,257
434,544,751
238,368,058
93,088,068
61,294,777
58,342,308
451,093,211
Raw Material & Packing Material consumed
19,621,119
Stores & Spare Parts consumed
134,104,256
Salary, Wages and Bonus
182,045,564
Contribution to Provident & other Funds
4,096,340
9,504,657
Gratuity
1,062,491
Analytical Testing & Trial charges
26,736,975
Rent
6,401,077
2,212,425
Postage & Communication
3,151,204
Travelling expenses
15,897,191
Books & Periodicals
6,317,043
Legal & Professional expenses
12,052,167
2,424,344
Donation
30,251
Repair & Maintenance :
- Buildings
5,726,552
2,386,093
- Plant & Machinery
14,628,824
17,360,639
- Others
3,728,604
24,083,980
1,740,037
Rates, Fees & Taxes
622,995
Subscription
9,467,437
Electricity & Water charges
33,714,494
Meeting & Conferences
2,460,794
765,564
Bank charges
-
Depreciation
169,025,407
Sundry expenses
4,146,270
669,944,045
32,890,327
91,423,646
155,895,586
3,607,381
7,046,234
3,287,690
15,803,303
7,569,467
2,591,736
2,794,844
12,638,102
3,966,683
9,158,686
2,044,023
1,880,651
* For Director’s Remuneration refer note no.5(a)
of Schedule XX C
Schedule XVI - Selling & Distribution Expenses
Advertising & Sales Promotion
Meetings & Conferences
Freight & Cartage
Commission on Sales (other than sole selling agents)
Schedule XVII - Research & Development Expenses
77
21,486,769
335,366
4,980,114
22,390,252
4,191,618
815,807
65,407
131,348,176
3,644,252
541,856,120
For the year ended
31st March, 2009
Amount in Rs.
For the year ended
31st March, 2008
Schedule XVIII - Financial Expenses
Interest on:
a) Fixed Loans
206,237,568
88,284,701
b) Others (Including interest on Working Capital Loans)
114,833,232
321,070,800
28,039,320
Bank charges
26,349,387
347,420,187
116,324,021
33,815,362
150,139,383
Schedule XIX - Earning Per Share
Calculation of Profit/ (Loss) for Basic EPS
Net profit/ (Loss) before Tax
Less: Adjustment for Tax Expense
Net profit/ (Loss) for calculation of Basic EPS
Weighted average number of Equity Shares in
calculating basic EPS
Calculation of Profit/ (Loss) for Diluted EPS
Net profit/ (Loss) for calculation of basic EPS
Adjusted Net Profit/ (Loss) for calculating Diluted EPS
No. of Equity Shares resulting from conversion of
Foreign Currency Convertible Bonds
‘US$50 Million Zero Coupon Convertible Bonds due 2011’ (Outstanding US$36.8 Million) at conversion price Rs.357.57
Add: Weighted average number of Equity Shares in
Weighted average number of Equity Shares in
calculating diluted EPS
Face / Nominal Value per Share
(923,740,873)
(233,243,988)
(690,496,885)
66,693,746
1,903,858,280
572,160,506
1,331,697,774
66,115,919
(690,496,885)
(690,496,885)
1,331,697,774
1,331,697,774
4,542,752
4,542,752
66,693,746
66,115,919
71,236,498
70,658,671
(10.35)
(10.35)
1.00
20.14
18.85
1.00
Schedule XX - Significant Accounting Policies and Notes on Accounts
A. Nature of Operations
Panacea Biotec Limited is one of the India’s leading research based companies engaged in the business of research, development,
manufacture and marketing of Vaccines and Branded Pharmaceutical Formulations. The Company has products for various
segments, which include paediatric vaccines, pain management, diabetes management and organ transplantation.
B. Significant Accounting Policies
1.
2.
Basis of Preparation
The financial statements have been prepared to comply in all material respects with the Notified Accounting Standards pursuant
to Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956.The financial statements
have been prepared under the historical cost convention on an accrual basis except in case of assets for which provision for
impairment is made and revaluation is carried out. The accounting policies have been consistently applied by the Company and
except for the changes in accounting policies discussed more fully below, are consistent with those used in the previous year.
Change in Accounting Policy
For the financial year ended 31st March, 2008, the Company was charging off exchange differences arising on foreign currency
monetary assets and liabilities to profit and loss account. Pursuant to Companies (Accounting Standards) Amendments Rules,
2009, the Company has exercised the option of deferring the charge of exchange difference to the Profit and Loss Account, in
respect of accounting periods commencing on or after 7th December, 2006, on long-term foreign currency monetary items (i.e.
monetary assets or liabilities expressed in foreign currency and having a term of 12 months or more at the date of origination). As
a result, such exchange differences so far as they relate to the acquisition of a depreciable capital asset have been adjusted with
the cost of such asset and are being depreciated over the balance life of the asset, and in other cases, have been accumulated in
Foreign Currency Monetary Item Translation Difference Account and are being amortized over the balance period of such long
term asset/liability but not beyond, accounting period ending on or before 31st March 2011.
In the current year, such exchange differences, pertaining to accounting periods commencing on 1st April, 2007 and ending on
31st March, 2008 are transferred from General Reserve, to the extent they related to acquisition of depreciable capital assets
are adjusted with the cost of such assets Rs.24,810,859 (net of depreciation of Rs.1,609,882) (net of tax of Rs.12,775,656) and in
other cases, are transferred to the Foreign Currency Monetary Item Translation Difference Account Rs.61,039,657 (net of tax of
Rs.31,430,661).
78
3.
4.
5.
6.
7.
8.
79
Had the Company continued to use the earlier basis of accounting for exchange differences arising on long-term foreign currency
monetary items, the loss after tax for the current period would have been higher by Rs.561,174,198 (net of tax of Rs.288,960,930),
the net block of fixed assets would have been lower by Rs.624,117,162 (net of depreciation of Rs.94,952,131) and general reserve
would have been higher by Rs.130,056,833.
Use of Estimates
The presentation of financial statements in conformity with the Generally Accepted Accounting Principles requires management
to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent
liabilities at the date on the financial statements and the reported amount of revenues and expenses during the reporting period.
Difference between the actual results and estimates are recognized in the period in which the results are known/ materialized.
Revenue Recognition
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can
be reliably measured.
Sale of Goods - Revenue is recognized when the significant risks and rewards of ownership of the goods have
passed to the buyer and is stated net of trade discounts, returns and Sales Tax /VAT but includes Excise Duty. Excise Duty deducted
from turnover is the amount that is included in the amount of turnover (gross) and not the entire amount of liability arisen during
the year.
Research & Development - Income from Research & Development Services is accounted for as per the stage of completion.
Contract Manufacturing - Revenue is recognized on an accrual basis in accordance with the term of the relevant agreement.
Interest - Revenue is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.
Dividends - Revenue is recognized when the shareholders’ right to receive payment is established by the balance sheet date.
Dividend from subsidiaries is recognized even if same are declared after the Balance Sheet date but pertains to the period on or
before the date of Balance Sheet, as per the requirements of Schedule VI to the Companies Act, 1956.
Royalties - Revenue is recognized on an accrual basis in accordance with the term of the relevant agreement.
Export Benefits - Export entitlements under Duty Entitlement Pass Book Schemes and Advance Licenses are recognized in the
Profit & Loss Account when the right to receive credit as per terms of scheme is established in respect of export made and where
there is no significant uncertainty regarding the ultimate collection of the relevant export proceeds.
Fixed Assets
Fixed assets are stated at cost less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price and
any attributable cost of bringing the asset to its working condition for its intended use. Borrowing costs relating to acquisition of
fixed assets which takes substantial period of time to get ready for its intended use are also included to the extent they relate to
the period till such assets are ready to be put to use.
As a result of change in Accounting Policy during the year (refer note no. 2 above) in respect of accounting periods commencing
on or after 7th December, 2006, exchange differences arising on reporting of the long-term foreign currency monetary items at
rates different from those at which they were initially recorded during the period, or reported in the previous financial statements
are added to or deducted from the cost of the asset and are depreciated over the balance life of the asset, if these monetary items
pertain to the acquisition of a depreciable fixed asset.
Impairment of Fixed Assets
The carrying amounts of assets are reviewed at each Balance Sheet date as to whether if there is any indication of impairment
based on internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its
recoverable amount. The recoverable amount is the greater of the assets net selling price and value in use. In assessing value in
use, the estimated future cash flows are discounted to their present value at the weighted average cost of capital.
After impairment, depreciation is provided on the revised carrying amount of the assets over its remaining useful life.
Intangibles
Patents, Trademarks & Designs - Costs relating to patents, trademarks and designs, which are acquired, are capitalized.
Research and Development Costs - Research costs are expensed as incurred. Development expenditure incurred on an individual
project is carried forward when its future recoverability can reasonably be regarded as assured.
Product Development – Product Development is capitalized on successful completion of development activities and commercial
launch of developed products.
Technical Know how - Technical Know how is being capitalized on successful transfer of technology when its future recoverability
can reasonably be regarded as assured.
Software and Website - Software and website is stated at cost of acquisition and includes all attributable costs of bringing them
to their working condition for their intended use.
The carrying value of intangible assets is reviewed for impairment annually when the asset is not yet in use, and otherwise when
events or changes in circumstances indicate that the carrying value may not be recoverable.
Depreciation / amortization
a) Depreciation on fixed assets is provided on written down value method as per the rates based on the useful life of the assets
estimated by the management, or as per rates prescribed in Schedule XIV to the Companies Act, 1956 whichever is higher.
Depreciation is provided on the following rates:
Tangibles Assets
WDV %
Building – Factory
Building – Office Premises
Plant & Machinery
Vehicles
Office Equipments
Computer Equipments
10.00
5.00
13.91
18.10
25.89
13.91
40.00
b)
9.
10.
11.
12.
13.
14.
Amortization on intangibles is provided on the basis of the estimated useful lives as follows:Software
-
Amortized on straight line basis over a period of 5 years.
Websites
-
Patents, Trade Marks & Designs -
Product Development
-
Technical Know-how
-
c) Leasehold Land is depreciated over the period of lease or useful life, whichever is shorter.
d) Leasehold Improvements are amortized over the initial period of lease or useful life, whichever is shorter.
Borrowing Costs
Borrowing costs attributable to the acquisition, construction or production of a qualifying asset are capitalized as part of the cost
of that asset. Borrowing costs, which are not relatable to qualifying assets, are recognized as an expense in the period in which
they are incurred.
Leases
Where the Company is the Lessee
Leases, where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term, are classified as
operating leases. Operating lease payments are recognized as an expense in the Profit and Loss account on a straight-line basis
over the lease term.
Where the Company is the Lessor
Assets subject to operating leases are included in fixed assets. Lease income is recognized in the Profit and Loss Account on a
straight-line basis over the lease term. Costs, including depreciation are recognized as an expense in the Profit and Loss Account.
Initial direct costs such as legal costs, brokerage costs, etc. are recognized immediately in the Profit and Loss Account.
Deferred Revenue Expenditure
Expenditure incurred prior to April 1, 2003 towards procuring license for new products is written off over the period of agreement
or ten years whichever is shorter. Expenditure of the similar nature incurred during the year is charged off to revenue.
Investments
Investments that are readily realizable and intended to be held for not more than a year are classified as current investments.
All other investments are classified as long-term investments. Current investments are carried at lower of cost and fair value
determined on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution, if
any, in value is made to recognize a decline other than temporary in the value of the investments.
Inventories
Finished Goods, Work in Progress, Goods held for Resale, Raw Materials, Packing Materials and Stores & Spares are stated at lower
of cost and net realizable value. However, materials and other items held for use in the production of inventories are not written
down below cost if the finished goods in which they will be incorporated are expected to be sold at or above cost.
‘Cost’ of Finished Goods, Work in progress, Raw Materials, Packing Materials and Stores & Spares is arrived at by using ‘Moving
Average Price’ method.
Cost of Work in Progress and Finished Goods is determined by considering direct material cost and appropriate portion of
manufacturing overheads based on normal operating capacity. Cost of traded goods is arrived at by using ‘Moving Average Price’
method. Cost of finished goods includes Excise Duty.
Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and to
make the sale.
Retirement and Other Benefits
a) Retirement benefits in the form of Provident Fund are defined contribution scheme and the contributions are charged
to the Profit and Loss Account of the year when the contributions to the respective funds are due. There are no other
obligations other than the contribution payable to the respective funds.
b) The contribution to Gratuity Fund, which is a defined benefit plan, is expensed on the basis of funding claims of the fund
manager, Life Insurance Corporation of India. At the end of the accounting year, actuarial valuation is done as per projected
unit credit method by an independent Actuary and any shortfall in the fund balance is further provided for.
c) Short term compensated absences are provided for based on estimates. Long term compensated absences are provided for
based on actuarial valuation done as per projected unit credit method.
Leave encashment payable /adjustable during the year is provided on the basis of last salary drawn by employees.
Actuarial gains/losses are adjusted in Profit & Loss Account and are not deferred.
80
15. Foreign Currency Transactions
Initial Recognition
Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount, the exchange
rate between the reporting currency and the foreign currency at the date of the transaction.
Conversion
Foreign currency monetary items are reported using the closing rate. Non-monetary items which are carried in terms of historical
cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction and non-monetary
items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange
rates that existed when the values were determined.
Exchange Differences
Exchange differences arising on the settlement of monetary items or on reporting such monetary items at rates different from
those at which they were initially recorded during the year, or reported in previous financial statements, are recognized as income
or as expenses in the year in which they arise except those monetary items as mentioned below.
Exchange differences, in respect of accounting periods commencing on or after 7th December, 2006, arising on reporting of
long-term foreign currency monetary items at rates different from those at which they were initially recorded during the period,
or reported in previous financial statements, in so far as they relate to the acquisition of a depreciable capital asset, are added to
or deducted from the cost of the asset and are depreciated over the balance life of the asset, and in other cases, are accumulated
in a “Foreign Currency Monetary Item Translation Difference Account” in the financial statements and amortized over the balance
period of such long-term asset/liability but not beyond accounting period ending on or before 31st March, 2011.
Exchange differences arising on a monetary item that, in substance, form part of company’s net investment in a non-integral
foreign operation is accumulated in a foreign currency translation reserve in the financial statements until the disposal of the net
investment, at which time they are recognized as income or as expenses.
Forward Exchange Contracts not intended for trading or speculation purposes
The premium or discount arising at the inception of forward exchange contracts is amortized as an expense or income over the
life of the contract. Exchange differences on such contracts are recognized in the statement of Profit and Loss Account in the
year in which the exchange rates change. Any profit or loss arising on cancellation or renewal of forward exchange contract is
recognized as income or as expense for the year.
16. Income Taxes
Tax expense comprises of current, deferred and fringe benefit tax. Current Income Tax and Fringe Benefit Tax is measured at
the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961, enacted in India. Deferred
Income Taxes reflect the impact of current year timing differences between taxable income and accounting income for the year
and reversal of timing differences of earlier years.
Deferred Income Tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet
date. Deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income
will be available against which such deferred tax assets can be realized. If the Company has unabsorbed depreciation or carry
forward tax losses, deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that such
deferred tax assets can be realized against future taxable profits.
At each Balance Sheet date the Company re-assesses unrecognized deferred tax assets. It recognizes unrecognized deferred tax
assets to the extent that it has become reasonably certain or virtually certain, as the case may be, that sufficient future taxable
income will be available against which such deferred tax assets can be realized.
The carrying amount of deferred tax assets are reviewed at each balance sheet date. The Company writes down the carrying
amount of a deferred tax assets to the extent that it is no longer reasonably certain or virtually certain, as the case may be,
that sufficient future taxable income will be available against which deferred tax assets can be realized. Any such write-down is
reversed to the extent that it becomes reasonably certain or virtually certain, as the case may be, that sufficient future taxable
income will be available.
17. Earnings Per Share
Basic Earnings per Share are calculated by dividing the net profit or loss for the period attributable to Equity Shareholders (after
deducting preference dividends and attributable taxes) by the weighted average number of Equity Shares outstanding during
the period. Partly paid Equity Shares, if any are treated as a fraction of an Equity Share to the extent that they were entitled
to participate in dividends relative to a fully paid Equity Share during the reporting period. The weighted average number of
Equity Shares outstanding during the period is adjusted for events of bonus issue, bonus element in a rights issue to existing
shareholders, share split, and reverse share split (consolidation of shares), if any.
For the purpose of calculating diluted Earnings per Share, the net profit or loss for the period attributable to Equity Shareholders
and the weighted average number of Shares outstanding during the period are adjusted for the effects of all dilutive potential
Equity Shares.
18. Provisions
A provision is recognized when the company has a present obligation as a result of past event and it is probable that an outflow
of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not
discounted to its present value and are determined based on management estimate required to settle the obligation at the
Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.
81
19. Segment Reporting Policies
(a) Identification of Segments:
Primary Segment
Business Segment: The Company’s operating businesses are organized and managed separately according to the nature of
products, with each segment representing a strategic business unit that offers different products. The identified segments
are Vaccines, Formulations and Research & Development Activities.
Secondary Segment
Geographical Segment: The analysis of geographical segment is based on the geographical location of the customers.
The geographical segments considered for disclosure are as follows:
•
Revenue from domestic market includes sales to customers located within India.
•
Revenue from overseas market includes sales to customers located outside India.
(b) Allocation of Common Costs: Common allocable costs are allocated to each segment on a rational basis based on nature of
each such common cost.
(c) Unallocated Items: Corporate income and expenses are considered as a part of unallocable income & expense, which are not
identifiable to any business segment.
20. Derivative Instruments
As per announcement of Institute of Chartered Accountants of India, accounting for derivative contracts, other than those
covered under AS-11, are marked to market on a portfolio basis, and the net loss after considering the offsetting effect on the
underlying hedge item is charged to the Profit & Loss Account. Net Gains are ignored.
21. Cash & Cash Equivalent
Cash and cash equivalents in the balance sheet comprise cash at bank and in hand and short-term investments with an original
maturity of three months or less.
22. Expenditure on new projects and substantial expansion
Expenditure directly relating to construction activity is capitalized. Indirect expenditure incurred during construction period is
capitalized as part of the indirect construction cost to the extent to which the expenditure is indirectly related to construction
or is incidental thereto. Other indirect expenditure (including borrowing costs) incurred during the construction period which is
not related to the construction activity nor is incidental thereto is charged to the Profit and Loss Account. Income earned during
construction period is deducted from the total of the indirect expenditure.
All direct capital expenditure on expansion are capitalized. As regards indirect expenditure on expansion, only that portion is
capitalized which represents the marginal increase in such expenditure involved as a result of capital expansion. Both direct and
indirect expenditure are capitalized only if they increase the value of the asset beyond its original standard of performance.
C. Notes to Accounts (All amounts are in Rs. unless otherwise stated)
1.
Contingent Liabilities (to the extent not provided for)
Particulars
Disputed demands/ show-cause notices under:a) Sales Tax Cases
b) Income Tax Cases
c) Customs Duty Cases
d) Central Excise Duty Cases
e) Service Tax
Total
Labour cases (in view of large number of cases, it is impracticable to
disclose each of them)
Other claims against the Company not acknowledged as debts
Premium on Redemption of ‘US$ 50 Million Zero Coupon
Convertible Bonds due 2011’ (Refer note 3(ii) below)
Current Year
Previous Year
-
110,557
3,999,923
6,596,620
29,789,842
40,496,942
2,803,586
13,809
2,863,251
3,999,923
6,596,620
13,473,603
4,143,107
-
470,992,269
64,000
243,706,599
Notes:
a)
Sales Tax liability of Rs.13,809 was on account of non-receipt of C forms from customers for inter-state sales. No provision was required for
the same as the management was hopeful of receiving the forms before the due date of filing of Sales Tax Returns.
b)
In respect of Income Tax, in Assessment Year 2005-06 the department disallowed ‘Club Expenses’ of Rs.255,800 on the ground that these
expenses were incurred in the personal names and not in the name of the company, hence not related to the business of the company in the
order under section 143(3) of the Act. The company preferred appeal before the CIT (Appeals). The CIT (Appeals) restricted the disallowance
to Rs.50,000 from Rs.2,55,800. In Assessment Year 2006-07 the department disallowed depreciation on LAN of Rs.60,557 on the ground
that depreciation on the same is allowable @25% and not @60% in the order under section 143(3) of the Act. No provision is considered
necessary in this regard since the Company believes it has a good case based on nature of the case and legal advice obtained by it.
82
2.
c)
In respect of Customs Duty demand of Rs.3,999,923 towards Customs Duty on certain items imported as exempted by the Company, the
Company has deposited the entire amount under protest. The matter is pending before the Honorable Supreme Court of India. No provision
is considered necessary in this regard since the Company believes it has a good case based on nature of the case and legal advice obtained
by it.
d)
In respect of Central Excise Duty demand of Rs.6,596,620 towards Excise Duty on common inputs used in manufacture of exempted and
taxable products, the Company has deposited the entire amount under protest. The matter is pending before Central Excise and Customs
Tribunal. No provision is considered necessary in this regard since the Company believes it has a good case based on nature of the case and
legal advice obtained by it.
e)
In respect of service tax demand of Rs.29,789,842/- relating to foreign services rendered & delivered outside India & others services, which
were brought in service tax net w.e.f. 18.04.06 and against which numerous decisions/ judgments have been pronounced by the competent
courts/judicial authorities, the Company has sent suitable reply to the concerned authority. No provision is considered necessary in this
regard since the Company believes it has a good case based on nature of the demand and legal advice obtained by it.
Estimated amount of contracts remaining to be executed on Capital Account, net of advances and not provided in the books are
as follows:S. No.
1.
2.
3.
Particulars
Tangibles Assets
Intangible Assets
Total
Current Year
420,258,712
21,946,833
442,205,545
Previous Year
306,726,108
90,701,180
397,427,288
i)
Conversion price of ‘US$ 50 Million Zero Coupon Convertible Bonds due 2011’ (FCCBs) has already been fixed at Rs.357.57
per Share. This Rate is used to determine dilutive Equity Shares against outstanding Bonds.
ii)
‘US$ 50 Million Zero Coupon Convertible Bonds due 2011’ amounting to US$ 36,800,000 are pending for redemption as on
31st March 2009. Unless these Bonds have been previously converted, redeemed, repurchased and cancelled, the Company
will redeem these Bonds at a price equal to 142.80% of the outstanding principal amount on the maturity date i.e. February
14, 2011 (including premium amounting to Rs.798,860,288). Since the redemption of bonds is contingent upon its nonconversion into Equity Shares and the probability of redemption cannot presently be ascertained, the Company has not
provided for the proportionate premium on redemption for the period upto 31st March, 2009 amounting to Rs. 470,992,269
(Previous Year Rs.243,706,599). Such premium has been disclosed as contingent liability. These Bonds are considered a
monetary liability and are redeemable only if there is no conversion before maturity date.
iii) The Company has fully utilized the issue proceeds of ‘US$ 50 Million Zero Coupon Convertible Bonds due 2011’ in earlier
years.
4.
Details of pre-operative expenses (included in Capital Work in Progress) relating to Fixed Assets are as follows:
Particulars
As at
April 1, 2008
Additions during
the year
Capitalised during
the year
As at
March 31, 2009
Legal & Professional
3,681,923
168,360
3,850,283
(2,941,783)
(2,059,204)
(1,319,064)
Store & Spares consumed
22,419,030
50,376
22,469,406
(2,325,569)
(22,126,744)
(2,033,283)
Power & Fuel
31,254,050
357,323
31,529,249
(4,219,189)
(27,922,199)
(887,338)
Rates & Taxes
9,857,569
-
9,572,561
(285,008)
(9,572,561)
-
- Plant & Machinery
4,452,852
-
4,452,852
(120,255)
(4,362,741)
(30,144)
- Others
5,861,464
773,882
6,545,065
(157,267)
(5,713,075)
(8,878)
Salary & Wages
13,191,507
-
13,191,507
(2,335,791)
(10,906,537)
(50,821)
Office Expenses
2,733,205
73,934
2,807,139
-
(2,733,205)
-
Travel & Conveyance Expenses
3,736,531
764,537
3,731,531
(1,003,717)
(2,732,814)
-
Rent
25,800
-
25,800
-
(25,800)
-
4,444,120
4,310,572
8,754,693
Miscellaneous Expenses
(347,310)
(4,311,298)
(214,488)
Total
101,658,051
6,498,984
106,930,086
(13,735,889)
(92,466,178)
(4,544,016)
(3,681,923)
(22,419,030)
82,124
(31,254,050)
285,008
(9,857,569)
Note: Figures in brackets represent previous year figures (2007-08)
83
(4,452,852)
90,281
(5,861,464)
(13,191,507)
(2,733,205)
769,537
(3,736,531)
(25,800)
(4,444,120)
1,226,949
(101,658,051)
5.
a)
Directors’ Remuneration:
Particulars
Current Year
Managing / Joint Managing Directors/ Whole-time Directors
Salary and Allowances*
58,346,813
Commission on Profits to Chairman/Managing Director/Joint Managing Directors
-
Perquisites (taxable value) 4,679,290
Contribution to Provident Fund
9,360
Total
63,035,463
Non Whole-time Directors
Allowances
930,000
Sitting Fees
345,000
Total
1,275,000 Grand Total
64,310,463
Previous Year
57,990,386
132,000,000
12,154,671
9,360
202,154,417
1,072,000
340,000
1,412,000
203,566,417
* Provision for leave encashment and gratuity amounting to Rs.3,263,596 (Previous year Rs.3,741,971) and Rs.6,007,834 (Previous year
Rs.18, 499,505) respectively, made during the year, is not included above.
b)
Computation of net profit in accordance with Section 198 read with section 309(5) of the Companies Act, 1956 (“the Act”)
and maximum amount permissible for managerial remuneration.
Particulars
Current year Previous Year
Profit/ (Loss) as per Profit & Loss Account (before taxes & extraordinary items)
(923,740,873) 1,903,858,280
Add:
Directors’ Remuneration
64,310,463
203,566,417
Loss/ (Profit) on sale of fixed assets (net)
(7,171,144)
(22,887,632)
Provision/ (Write back) for Doubtful Debts and Advances
384,794
27,044,708
Loss/ (Profit) on Sale of Investment
-
(8,062,060)
Net profit/ (Loss) in accordance with Section 198 of the Act
(866,216,760) 2,103,519,713
Maximum amount permissible under Section 309 read with Section II of Part II of 24,865,757
210,351,971
Schedule XIII to the Act for payment to Managing/Joint Managing Directors and
Whole-time Directors
Maximum amount permissible under Section 309 of the Act for payment to 930,000*
21,035,197
Total Allowable to Managing/ Joint Managing/ Whole-time and 25,795,757
231,387,168
*This amount is as per the approvals of Ministry of Corporate Affairs , New Delhi vide their letters no. 12/301/2006-CL.VII dated 08.02.2007,
F.No. 2/119/2005-CL.VII dated 16.01.2005 and 12/304/2006-CL.VII dated 08.02.2007
6.
Disclosure of Micro & Small Enterprises
Details of dues to Micro, Small and Medium Enterprises as per Micro Small and Medium Enterprise Development Act, 2006 (MSMED Act)
Principal amount and interest due thereon remaining unpaid to any
supplier as at year end.
Interest paid by the Company in terms of section 16 of the MSMED Act
along with the amounts of the payment made to the supplier beyond
the appointed day during accounting year
Interest due and payable for the period of delay in making payment
(which have been paid but beyond the appointed day during the year)
but without adding the interest specified under MSMED Act Interest accrued and remaining unpaid at the end of the year.
Further interest remaining due and payable in succeeding years, until
such date when the interest dues as above are actually paid to the
small enterprises for the purpose of disallowance as a deductible
expenditure under section 23 of the MSMED Act
84
Current Year
Previous Year
Principal Interest Principal Interest
1,274,843
Nil 1,177,455
Nil
3,552,413
68,868 4,703,195
78,680
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
7.
Deferred Tax Liabilities (Net):
The break-up of deferred tax liability is as follows:-
Current Year
Deferred Tax Liabilities:
Differences in depreciation and amortization in block of fixed assets as
498,736,734
per Income Tax Act and books of accounts
Deferred revenue expenditure
1,241,287
Capital expenditure on research & development 267,365,739
Forex Loss (revenue) deferred as per notification on AS-11 (Revised)
50,254,492
Gross Deferred Tax Liabilities
817,598,252
Deferred Tax Assets:
Effect of expenditure debited to Profit and Loss Account in the current year but
47,441,741
allowed for tax purposes in following years
Loss as per Income Tax Act carried forward 364,509,363
Unabsorbed Depreciation as per Income Tax Act carried forward
71,861,483
Gross Deferred Tax Assets
483,812,587
Net Deferred Tax Liability
333,785,665
Previous Year
373,239,618
1,813,135
262,159,287
637,212,040
42,182,387
42,182,387
595,029,653
Note: The Company has recorded a loss before tax of Rs.923,740,873 in year ended March 2009 which is mainly on account of foreign currency
loss of Rs.1,702,604,000 on open derivative contracts. The Company is otherwise earning good operating margin and based on orders on hand,
it is virtually certain that it will earn sufficient margins to generate income to reverse book losses and will generate taxable profits to set-off
the unabsorbed depreciation and carry-forward losses and other timing differences resulting into deferred tax assets. Hence, the Company has
recognised deferred tax asset as at March 31, 2009 on carry-forward losses component also.
8.
i)
Amounts due from/ payable to group companies (including companies under the same management as defined under
section 370 (1B) of the Companies Act, 1956), are as follows–
Particulars
Current Year
a) Loans and Advances to wholly owned subsidiaries - Best On Health Ltd.
Balance recoverable
-
Maximum amount due at any time during the year
-
- Panacea Educational Institute Pvt. Ltd. Balance recoverable
-
-
- Panacea Hospitality Services Pvt. Ltd. Balance recoverable
-
-
- Sunanda Steel Company Ltd. Balance recoverable
-
-
- Radicura & Co. Ltd. Balance recoverable
-
-
- Rees Investments Ltd.
Balance Recoverable 710,717,916
716,413,472
Accrued Interest on loan but not due
28,887,763
- Panacea Biotec, Inc.
Balance Recoverable
93,154
93,154
b) Dues from associates
- PanEra Biotec Pvt. Ltd. (Previously known Panheber Biotec Pvt. Ltd. )
Balance Recoverable (including Rs.41,137,053 on account of sale of raw
material grouped as sundry debtors under Schedule VII )
195,087,247
195,087,247
c) Amount payable to wholly owned subsidiaries
- Best On Health Ltd. Balance Payable
-
3,079,105
- Radicura & Co. Ltd.
Balance Payable
-
-
- Panacea Biotec GmbH
Balance Payable
202,620
202,620
ii)
85
Previous Year
1,791,000,000
320,000,000
320,000,000
140,000,000
620,000,000
-
135,532,654
135,532,654
3,079,105
3,079,105
5,214,925
-
Loans and advances include Rs.116,109,320 (Previous Year Rs.40,312,505) due from Joint Venture Company, in which
Company’s director was inter alia director till 1st December, 2008.
iii) Debtors include Rs.78,154,432 (Previous Year Rs.55,117,691) receivable from Joint Venture Company in which company’s
directors are, inter-alia, directors.
iv) Details of Loans and advances to subsidiaries, associates and parties in which directors are interested (as required by clause
32 of listing agreement):
Particulars
9.
Current Year
Previous Year
a) Loans and Advances to wholly owned subsidiaries (Refer note no. 8 (i) above)
-
b) Loan to Joint Venture Company - Cambridge Biostability Ltd.
108,833,850
133,075,781
Accrued interest receivable on loan
7,275,470
c) Dues from associates (Refer note no. 8 (i) above)
-
39,778,050
41,784,182
534,455
-
Related Party Disclosures
A. Names of Related Parties
Names of related parties where control exists irrespective of whether transactions have occurred or not
(a) Joint Ventures
Chiron Panacea Vaccines Private Limited; Cambridge Biostability Limited
(b) Subsidiaries
BestOnHealth Ltd. (BOH) (Wholly-owned subsidiary (WOS)); Radicura & Co. Ltd. (Indirect WOS
through BOH); Panacea Hospitality Services Pvt. Ltd. (Indirect WOS through BOH); Panacea
Educational Institute Pvt. Ltd. (Indirect WOS through BOH); Sunanda Steel Company Ltd. (Indirect
WOS through BOH); Rees Investments Ltd. (Rees) (Guernsey): (WOS w.e.f. 16th September 2008);
Kelisia Holdings Ltd. (Cyprus): (Indirect WOS w.e.f 18th September 2008 through Rees); Kelisia
Investment Holding AG (KIH) (Switzerland):(Indirect WOS w.e.f. 22nd October 2008 through Kelisia
Holdings Ltd); Panacea Biotec (International) SA (Switzerland) (Indirect WOS w.e.f. 19th Feb. 2009
through KIH); Panacea Biotec FZE, (UAE) ( WOS w.e.f. 16th March 2008); Panacea Biotec GmbH
(Germany) ( WOS w.e.f. 11th June 2008); Panacea Biotec, Inc. (USA) (WOS w.e.f. 15th July 2008);
Umkal Medical Institute Pvt. Ltd. (Subsidiary w.e.f. 30th June 2008);
(c) Associates
PanEra Biotec Private Limited; Lakshmi & The Manager (upto 30th June 2008); Lakshmi & Manager
Holdings Ltd. (LMH) (w.e.f. 1st July 2008); Best General Insurance Co.Ltd (Indirect associatesubsidiary of LMH)
(d) Key Management Mr. Soshil Kumar Jain
Personnel
Mr. Ravinder Jain
Dr. Rajesh Jain
Mr. Sandeep Jain
Mr. Sumit Jain
-
-
-
-
-
Chairman and Whole-time Director
Managing Director
Whole-time Director
(e) List of Persons having controlling interest together with their relatives*:
Key
Management
Personnel
Father
Mother
Wife
Brother
Sister
Son
Soshil Kumar Jain
-
-
Nirmala Jain
-
-
Ravinder Jain, Rajesh Jain, Sandeep Jain
Ravinder Jain
Soshil Kumar Jain
Nirmala Jain
Sunanda Jain
Rajesh Jain,
-
Sumit Jain,
Sandeep Jain
Nipun Jain
Rajesh Jain
Soshil Kumar Jain
Nirmala Jain
Meena Jain
Ravinder Jain,
-
Ankesh Jain, Sandeep Jain
Harshet Jain
Sandeep Jain
Soshil Kumar Jain
Nirmala Jain
Pamilla Jain
Ravinder Jain, -
Rajesh Jain
Sumit Jain
Ravinder Jain
Sunanda Jain
Nipun Jain
Radhika Jain -
(f )
Daughter
Radhika Jain
-
Priyanka Jain
-
*Relatives holding Equity shares in the Company have been disclosed
Relatives of Key Management personnel having transactions with the Company:
Mr. Ashwani Jain, Son-in-law of Mr. Soshil Kumar Jain
Mr. Shagun Jain, Son-in-law of Mr. Ravinder Jain
Mrs. Radhika Jain, Daughter of Mr. Ravinder Jain
Mrs. Shilpy Jain, Wife of Mr. Sumit Jain
(g) Enterprises over which Person(s) having control or significant influence over the Company / Key management
personnel(s), along with their relatives, are able to exercise significant influence:
i) Neophar Alipro Ltd.; ii) All India S. L. Jain Charitable Foundation; iii) First Lucre Partnership Co.*; iv) Second Lucre
Partnership Co.*; v) Radhika Associates; vi) Sumit Nipun & Co.; vii) Rattan Sons; viii) Tahir & Co.; ix) Best On Health Foods
Ltd. ; x) Soshil Kumar Jain (HUF)*; xi) Ravinder Jain (HUF)*; xii) Rajesh Jain (HUF)*; xiii) Sandeep Jain (HUF)*.
*These enterprises are also holding Shares in the Company.
86
87
Notes:
1.
Figures in brackets represent previous year figures
2.
In respect of personal guarantee given by Promoters-Directors refer Note no. 2 of Schedule III.
2,333,566,594
(2,049,108,818)
(-)
36,163,233
(534,455)
273,334,833
(190,650,345)
135,532,654
(135,532,654)
819,551,766
(39,778,050)
300,000,000
(432,500,000)
202,620
(3,079,105)
126,185,379
(41,244,079)
284,415,023
(218,345,905)
45,000
(208,705)
33,049,175
(-)
67,236,019
(52,845,255)
202,620
(-)
5,385,040
(12,274,200)
17,772,031
(1,138,945)
67,879,348
(206,996,554)
747,318,029
(1,652,325,291)
300,000,000
(612,500,000)
432,500,000
(353,490,000)
35,893,714
(26,081,308)
43,641,600
(43,641,600)
324,457,776
(1,831,700,000)
(690,000)
41,257,126
(20,128,500)
200
(1,612,000,000)
16,868,753
(3,093,565)
300,000
(500,000)
12,089
(-)
12,089
(-)
Total
(Amount in Rupees)
Particulars
Subsidiaries
Joint
Associates
Key
Relatives
Enterprises over
Ventures
Management
of Key
which Person(s)
Personnel
Management having control or
Personnel significant influence
over the Company/
Key Management
Best On
Radicura Panacea Panacea
Sunanda Steel
Rees
Panacea
Panacea
Umkal
Panacea
Panheber
Chiron Cambridge
PanEra
Lakshmi
Lakshmi &
Personnel(s), along
Health Ltd.
& Co. Ltd.
Educational Hospitality
Company
Investment
Biotec
Biotec
Medical
Biotec
Biotec Pvt. Panacea
Biostability
Biotec Pvt. and The
Manager
with their relatives,
Institute Services
Limited
Ltd.
INC
GmbH
Institute
FZE
Ltd. Upto
Vaccines
Ltd.
Ltd. (w.e.f
Manager
Holdings Ltd.
are able to exercise
Pvt. Ltd.
Pvt. Ltd.
Pvt.Ltd.
20.11.07
Pvt. Ltd.
21.11.07)
significant influence
A. During the Year
Purchase of raw materials
-
-
-
-
-
-
-
-
-
-
-
-
-
126,185,379
-
-
-
-
-
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(15,595,358)
(-)
(-)
(25,648,721)
(-)
(-)
(-)
(-)
(-)
Sale
-
-
-
-
-
-
-
-
-
-
-
243,277,970
-
41,137,053
-
-
-
-
-
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(218,345,905)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
Purchase of Fixed Assets
-
45,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(208,705)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
Processing Charges paid
-
-
-
-
-
-
-
-
-
-
-
-
7,892,040
25,157,135
-
-
-
-
-
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
Recovery of dues on Account of Expenses
273,197
-
-
-
-
-
-
-
-
-
-
-
-
66,962,822
-
-
-
-
-
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(33,555,530)
(-)
(-)
(19,289,725)
(-)
(-)
(-)
(-)
(-)
Reimbursement on Account of Expenses
-
-
-
-
-
-
-
202,620
-
-
-
-
-
-
-
-
-
-
-
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
Rent paid
5,385,040
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(5,195,520)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(7,078,680)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
Rent received
-
-
-
-
-
-
-
-
-
-
-
-
-
17,772,031
-
-
-
-
-
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(56,000)
(-)
(-)
(1,082,945)
(-)
(-)
(-)
(-)
(-)
Remuneration
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
63,035,463
4,843,885
0
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(202,154,417)
(4,842,137)
(-)
Loan / Advance given
200
-
-
-
-
667,448,507
79,322
-
-
-
-
-
79,790,000
-
-
-
-
-
-
(-)
(620,000,000)
(320,000,000)
(320,000,000)
(352,000,000)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(40,325,291)
(-)
(-)
(-)
(-)
(-)
(-)
Loans/Fixed Deposits received
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
300,000,000
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(612,500,000)
Loans/Fixed Deposits repaid
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
432,500,000
(-)
(5,100,000)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(348,390,000)
Interest paid on Deposits / loans
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
35,893,714
(-)
(145,595)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(25,935,713)
Dividend paid - Equity Shares
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
19,503,700
24,137,900
-
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(19,503,700)
(24,137,900)
(-)
Investments made
199,999,800
-
-
-
-
476
-
1,582,250
76,143,604
5,474,520
-
-
-
-
-
41,257,126
-
-
-
(1,791,000,000)
(-)
(100,000)
(100,000)
(500,000)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(40,000,000)
(-)
(-)
(-)
(-)
Purchase of Share
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(100,000)
(590,000)
(-)
Sale of Investment/Conversion of Loan
-
-
-
-
-
-
-
-
-
-
-
-
-
-
41,257,126
-
-
-
-
into Share Capital
(20,128,500)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
Repayment of Loan/Advance given
200
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(-)
(620,000,000)
(320,000,000)
(320,000,000)
(352,000,000)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
Interest received
-
-
-
-
-
-
-
-
-
-
-
-
16,868,753
-
-
-
-
-
-
(1,100,219)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(1,993,346)
(-)
(-)
(-)
(-)
(-)
(-)
Donation
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
300,000
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(500,000)
Insurance claim received
12,089
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
Insurance claim paid
12,089
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
B. Year end balances
Investments
2,013,882,850
-
(-)
(-)
(-)
476
-
1,582,250
76,143,604
5,474,520
(-)
22,959,100
168,068,998
4,197,670
-
41,257,126
-
-
-
(1,813,883,050)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(22,959,100)
(168,068,998)
(4,197,670)
(40,000,000)
(-)
(-)
(-)
Interest accrued and due on Loan
-
-
-
-
-
0
-
-
-
-
-
-
-
-
-
-
-
-
-
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
Interest accrued but not receivable
-
-
-
-
-
28,887,763
-
-
-
-
-
-
7,275,470
-
-
-
-
-
-
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(534,455)
(-)
(-)
(-)
(-)
(-)
(-)
Outstanding receivable -
-
-
-
-
-
93,154
-
-
-
-
78,154,432
-
195,087,247
-
-
-
-
-
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(55,117,691)
(-)
(135,532,654)
(-)
(-)
(-)
(-)
(-)
Provision for bad and doubtful advances
-
-
-
-
-
-
-
-
-
-
-
-
-
135,532,654
-
-
-
-
-
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(135,532,654)
(-)
(-)
(-)
(-)
(-)
Outstanding Loan
-
-
-
-
-
710,717,916
-
-
-
-
-
-
108,833,850
-
-
-
-
-
-
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(39,778,050)
(-)
(-)
(-)
(-)
(-)
(-)
Outstanding Fixed deposits
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
300,000,000
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(432,500,000)
Outstanding payable
-
-
-
-
-
-
-
202,620
-
-
-
-
-
-
-
-
-
-
-
(3,079,105)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
(-)
B. Detail of transactions with the Related parties
3. Material related party transactions (More than 10% of aggregate) with individual parties are as follows:
Unsecured Loans/ Fixed
Deposit received/(repaid)
Current Year
Interest
Previous Year
Current Year
Managerial Remuneration
Previous Year
Current Year
Equity Dividend
Previous Year
Current Year
Previous Year
Key Management personnel
-
-
-
-
15,155,738
48,153,429
5,000,000
5,000,000
Mr. Ravinder Jain
-
-
-
-
19,321,956
59,771,725
4,646,200
4,646,200
Dr. Rajesh Jain
-
-
-
-
12,648,046
45,645,737
4,706,900
4,706,900
Mr. Sandeep Jain
-
-
-
-
12,648,046
45,645,737
4,792,100
4,792,100
Enterprises over which Person(s) having control or significant influence over the Company / Key management personnel(s), along with their relatives, are able to exercise significant influence
300,000,000
612,500,000
35,893,714
25,405,853
-
-
-
First Lucre Partnership Co.
(432,500,000) (330,000,000)
-
-
-
-
-
All India S.L. Jain Charitable Foundation
-
-
-
415,993
-
-
-
Year end Balances
300,000,000
432,500,000
-
-
-
-
-
-
10. Derivative Instruments and Hedged/Unhedged Foreign Currency Exposure
i) Forward contract outstanding as at Balance Sheet date
Sell - Nil;
Buy - Nil
ii) Particulars of Hedged Export Receivables at applicable exchange rates in respect of Options Contracts outstanding
as at Balance Sheet date
Currency
Exchange
rates
Amount in Foreign
Currency
Amount in
Indian Rupees
Amount in
Foreign Currency
Amount in
Indian Rupees
Purpose
Current Year
Current Year
Previous Year
Previous Year
USD
41.00
-
-
28,000,000
1,148,000,000
USD
40.55
-
-
30,000,000
1,216,500,000
Export
USD
40.00
58,000,000
2,320,000,000
84,000,000
3,360,000,000
Receivables
USD
39.00
48,000,000
1,872,000,000
48,000,000
1,872,000,000
USD
39.60
36,000,000
1,425,600,000
36,000,000
1,425,600,000
To hedge
142,000,000
5,617,600,000
226,000,000
9,022,100,000
Accordingly, exchange fluctuation loss on marking them to market as of year end amounting to Rs.1,702,604,000 Previous
Year Rs.40,500,000) has been accounted for and included in “Provision for Loss on Open Derivative Contracts” under
Schedule XIII - Operating and Other Expenses.
iii) Particulars of Hedged Foreign Currency Exposure as at Balance Sheet date
Particulars
Amount as at
Currency
31st March’09
(in Foreign Currency)
Export Debtors
15,038,066
USD
Closing
Exchange
Rate*
Amount as at
31st Mar’09
(INR)
50.71
762,580,345
Amount as at Currency
Closing
31st March’08 Exchange (in Foreign Currency)
Rate*
28,387,626
USD
Amount as at
31st Mar’08
(INR)
40.12 1,138,769,629
iv) Particulars of Unhedged Foreign Currency Exposure as at Balance Sheet date
Particulars
Amount as at
Currency
31st March’09
5,542,275
12,841,668
33,538
12,289
1,217,220
16,820
1,010
2,990,037
65,097,252
9,652,566
105761
36,800,000
10
137,000
25,000
1,935,615
1,500,000
14,015,340
Import Creditors
Export Debtors
Foreign Currency Loans
Balance with Banks
FCCBs
Investment in Subsidiary
Investment in JV
Loan to JV
Loan to Subsidiaries
USD
Euro
CHF
GBP
JPY / 100
SEK
CAD
Euro
USD
USD
Euro
USD
USD
USD
Euro
GBP
GBP
USD
Closing
Exchange
Rate*
Amount as at
31st Mar’09
(INR)
50.72
67.54
44.56
72.60
51.55
6.13
40.47
67.50
50.72
50.71
67.50
50.72
47.62
39.96
63.29
86.83
72.56
50.71
281,104,206
867,327,519
1,494,481
892,159
627,521
103,140
40,856
201,827,823
3,301,732,614
489,481,613
7,138,856
1,866,496,000
476
5,474,520
1,582,250
168,068,998
108,833,850
710,717,916
Closing
Rate*
5,332,130
USD
887,098
Euro
35,692
CHF
17,355
GBP
2,576,200 JPY / 100
16,820
SEK
-
-
2,589,747
Euro
45,221,166
USD
874,867
USD
1,404,665
Euro
36,800,000
USD
-
-
-
-
-
-
1,935,615
GBP
500,000
GBP
-
-
40.11 213,845,059
63.35
56,197,580
39.89
1,423,840
79.52
1,380,106
39.99
1,030,086
6.74
113,399
-
63.38 164,142,548
40.11 1,813,599,550
40.12
35,095,290
63.38
89,030,070
40.11 1,475,864,000
-
-
-
86.83 168,068,998
79.56
39,778,050
-
-
*Closing Exchange rate has been rounded off to two decimal places.
88
Amount as at
31st Mar’08
(INR)
11. Segmental Information
A. Information about Primary Segments
Particulars
Vaccines 2008 – 09
Formulations
2007 – 08
2008 – 09
2007 – 08
2008 – 09
Total
2007 – 08
2008 – 09
2007 – 08
Segment Revenue
5,470,170,035
6,324,557,852
2,262,302,399
1,976,017,496
1,699,562
3,867,030
Other Income
5,952,196
40,218,416
24,950,226
32,517,814
-
-
Total
5,476,122,231
6,364,776,268
2,287,252,625
2,008,535,310
1,699,562
3,867,030
Segment Result
2,661,847,455
2,861,717,201
466,882,428
220,394,689
(668,244,483)
(537,989,091)
Unallocated Corporate Expenses
Operating Profit / (Loss)
Interest & Finance charges
Other Income
Income Taxes
Net Profit / (Loss)
7,734,171,996
30,902,422
7,765,074,418
2,460,485,400
3,291,930,523
(831,445,123)
(321,070,800)
228,775,049
233,243,988
(690,496,886)
8,304,442,378
72,736,230
8,377,178,608
2,544,122,799
792,637,757
1,751,485,042
(146,632,224)
299,005,462
(572,160,506)
1,331,697,774
12,064,889,515
4,808,922,747
1,6873,812,262
1,269,118,675
9,453,200,641
10,722,319,316
8,415,421,246
4,427,805,432
12,843,226,678
814,938,351
5,056,241,670
5,871,180,021
Revenue
Other Information
Segment Assets
8,164,022,933
4,555,500,911
1,757,286,755
1,914,995,988
2,143,579,827
1,944,924,347
Unallocated Corporate Assets
Total Assets
8,164,022,933
4,555,500,911
1,757,286,755
1,914,995,988
2,143,579,827
1,944,924,347
Segment Liabilities
812,019,662
469,524,505
391,402,477
257,279,313
65,696,536
88,134,533
Unallocated Corporate Liabilities
Total Liabilities
812,019,662
469,524,505
391,402,477
257,279,313
65,696,536
88,134,533
Capital Expenditure – Additions
1,948,866,420
372,154,760
123,752,797
82,121,704
578,593,601
175,826,431
Depreciation
350,826,118
111,412,186
125,068,119
129,116,679
169,025,407
131,348,176
B.
a)
Information about Secondary Segments
Revenue as per Geographical Markets
Segment
Domestic*
Vaccines
Formulations
R & D
Total
Overseas
Current Year
Previous Year
Current Year
Previous Year
3,991,735,243
1,798,741,628
-
5,790,476,871
6,015,579,612
1,604,484,560
-
7,620,064,172
1,478,434,793
463,560,771
1,699,562
1,943,695,126
308,978,240
371,532,936
3,867,030
684,378,206
* Domestic revenue includes revenue from deemed exports of Rs.3,708,466,456 (Previous Year Rs.5,797,333,245)
b)
Sundry debtors as per Geographical Markets
Segment
Domestic
c)
Current Year
Previous Year
Overseas
Current Year
Previous Year
Vaccines
336,012,170 1,190,336,164
536,329,974
Formulations
140,405,116
112,388,470
226,054,249
179,883,789
Total
476,417,286 1,302,724,634
762,384,223
179,883,789
The Company has common fixed assets for producing goods for Domestic Market and Overseas Markets. Hence, separate
figures for segment assets / additions to segment assets cannot be furnished.
12. Leases
i.
For assets given under Operating Lease agreements:
a)
The Company has leased out the assets situated at Lalru, Punjab on operating lease to its Associate, PanEra Biotec Private
Limited.
Particulars
Gross Block
Accumulated Depreciation
89
Depreciation charged
to P&L Account
Current Year
Previous Year
Current Year
Previous Year
Current Year
Previous Year
Building
Furniture and Fixture
Office Equipment
Plant & Machinery
Computer Equipment
Total
89,955,066
10,659,476
1,904,239
663,486,845
5,950,080
771,955,706
18,352,562
6,750,149
512,602
316,043,799
671,976
342,331,088
33,159,226
5,639,670
769,438
247,986,666
1,549,742
289,104,742
6,605,854
3,861,199
244,331
146,532,544
557,752
157,801,680
5,327,263
1,151,292
270,436
66,307,911
688,492
73,745,394
1,305,186
638,461
43,346
27,388,797
76,149
29,451,939
The total of Minimum Future Lease Payments under non-cancelable operating lease for various periods for assets stated
above is as follows:
As at
As at
March 31, 2009* March 31, 2008
a) Receivable within 1 year
b) Later than 1 year but not later than 5 years
c) Later than 5 years
67,600,000
67,600,000
-
9,600,000
-
* The Lease term for the assets given on lease vide Agreement for providing Manufacturing Facility, Utilities and Services of Employees with
PanEra Biotec Pvt. Ltd. is valid till 31.03.2011. As per the said Agreement, during the period of usage, if any, Facility is used for manufacture
of the Company’s Vaccines other than those mentioned therein or the facility remains idle due to insufficiency of orders from the Company,
no lease rental shall be payable by PanEra Biotec Pvt. Ltd. during the relevant period.
b)
The Company has also given an office space in its building situated at B-1 Extn./A-27, Mohan Co-operative Industrial Estate,
New Delhi on operating lease to PanEra Biotec Pvt. Ltd.
Total of future minimum lease payments under operating lease mentioned above:
As at
As at
March 31, 2009 March 31, 2008
ii.
a)
b)
c)
14,000
-
-
For assets taken on Lease
The Company has taken various residential, office and godown premises under operating lease agreements. These are
generally not non-cancelable and are renewable by mutual consent on mutually agreed terms.There is no sublease payments
expected to be received under non-cancellable subleases at the balance sheet date and no restrictions is imposed by lease
arrangements.
Lease payments for the year are Rs.59,649,090 (Previous Year Rs.59,319,447).
Total of future minimum lease payments under Non Cancelable operating lease:
As at
As at
March 31, 2009 March 31, 2008
a) Payable within 1 year
13. a)
21,000
-
4,796,232
402,737
-
4,578,616
5,198,969
-
The Company’s interest in Joint Venture Companies is as follows:
S. No. Name of the Company
Nature of
relationship
Country of
Incorporation
(%) Holding as on
March 31, 2009
1.
2.
Joint Venture
Joint Venture
India
UK
50
10
Chiron Panacea Vaccines Private Limited
Cambridge Biostability Limited*
* Cambridge Biostability Limited, UK has not been considered while giving the disclosures relating to joint ventures in the current year as
the investee company is in the process of filing for liquidation.
b)
Aggregate interest of the Company in Assets, Liabilities, Revenue & Expenses in the jointly controlled entities are as
follows:
Particulars
Current Year Previous Year
Audited
Audited
Fixed Assets Current Assets Secured Loans
Current Liabilities Revenue Expenses c)
3,209,287
143,485,483
163,121
78,995,574
274,923,479
241,498,029
16,434,549
122,905,261
406,220
53,831,022
254,384,438
244,192,539
Following are reimbursement of expenses from PanEra Biotec Pvt. Ltd. (formerly known as Panheber Biotec Pvt. Ltd.) which
have been netted off with related expense head:
Particulars
Salaries, Wages & Bonus
Power & Fuel etc.
Repair & Maintenance – Plant & Machinery
Repair & Maintenance – Others
Total
Current Year*
Previous Year
-
-
-
-
-
21,834,225
20,392,622
1,635,498
8,982,910
52,845,255
* Current year figures have not been furnished since PanEra Biotec Pvt. Ltd. ceased to be joint venture company w.e.f. 20th Nov. 2007.
90
d)
The purchase commitments for fixed assets incidental to the ordinary course of business of companies with which the
Company has a joint venture, are as follows :
Name of Company
Current Year
Previous Year
-
-
-
-
Chiron Panacea Vaccines Pvt. Ltd. (50% interest)
Cambridge Biostability Ltd. (10% interest)
Total
e)
Subsequent Event: The Company’s Joint Venture Cambridge Biostability Limited (CBL), having regard to its financial position,
has initiated steps to place it into creditors’ voluntary liquidation, subsequent to the Balance Sheet date. Due to the financial
position of CBL, the Company considers its investments in CBL as well as loan given to it, doubtful of recovery. Accordingly,
the following have been provided for in the books of accounts of current year.
Particulars
Amount
Investment made
168,068,998
Loan given
108,833,850
Interest accrued on above Loan
7,275,470
Total
284,178,318
14. Auditors` Remuneration includes the following
Particulars
Current Year
Statutory Auditors
- Statutory Audit
- Quarterly Limited Reviews
- Certificates
- Out of Pocket Expenses
Tax Auditors*
Cost Auditors*
Previous Year
3,309,000
1,685,400
134,833
161,720
5,290,953
140,450
44,944
3,400,060
1,348,320
113,217
69,317
4,930,914
140,450
33,708
* included in Legal & Professional charges given in Schedule XIII.
15. Additional information as required under Para 3 & 4 of Part II of Schedule VI of the Companies Act, 1956.
A. Particulars of Licensed Capacity, Installed Capacity & Production.
a) Licensed Capacity per annum
Recombinant Bulk Vaccine – 180 lac doses
Others – Not Applicable
b) Installed Capacity per annum*
Products
Tablets
Capsules
Syrups/Liquids Gels
Vaccines (Finished Doses)
Pre-filled Syringes
Recombinant Bulk Vaccines**
Tetanus Bulk Vaccines***
Bacterial Bulk Vaccines***
Units of Measurement
Nos./ Million
Nos. / Million
Bottles / Million
Tubes / Million
Doses / Million
Doses/ Million
Doses / Million
Doses/ Million
Doses/ Million
Current year
Previous Year
1,684.0
370.0
15.8
21.2
861.5
17.0
12.5
75.0
68.75
1,684.0
370.0
15.8
21.2
820.0
12.5
75.0
50.0
* As Certified by the management
** This facility has been leased to Associate Company, PanEra Biotec Pvt. Ltd. and is capable of manufacturing various bulk
vaccines including Hep B, Hib TT and Anthrax.
***These facilities have been leased to Associate Company, PanEra Biotec Pvt. Ltd. Bacterial Bulk Vaccines Plant is capable of
manufacturing various bulk vaccine including Diphtheria, Whole Cell Pertussis (wP), Acellular Pertussis(aP) and its capacity will
come down by 5 million doses to 63.75 million doses in case of production of Acellular Pertussis (aP).
c)
Actual Production during the year.
Products
Tablets
Capsules
Syrups / Liquids
Gels
Vaccines
Pre Fill Syringe
Injection
Other Products
Units of Measurement
Nos.
Nos.
Ml
Gms
Vials
PFS
Nos.
Gms.
Current Year* Previous Year*
504,389,489** 425,555,706**
64,354,858
55,436,411
283,920,530 246,056,820
23,474,760 65,585,870
50,553,815
69,507,387
1,679,769
456,656
588,105
17,638,965
-
* Actual Production includes production at Loan Licensee locations meant for sale by the Company.
** Actual Production includes 155,993,730 (Previous Year 8,104,220) Tablets manufactured for others under Loan License basis.
91
B. Particulars of Stocks & Sales
Units
Opening Stock
Closing Stock
Current
Previous
Current
Previous Year
Year
Year
Year
a) Own Manufacturing
Tablets
Nos.
78,301,586 116,699,523
59,005,305 78,301,586
Rs.
63,382,524
74,352,761
46,940,103
63,382,524
Capsules
Nos.
14,547,473
11,841,247
9,873,246 14,547,473
Rs.
63,436,317
96,557,062
40,651,005
63,436,317
Syrups/ Liquids
Ml
50,579,060
90,520,100
66,737,470
50,579,060
Rs.
15,939,607
16,910,186
17,837,248
15,939,607
Gels
Gms
16,354,230
28,407,220
8,458,210
16,354,230
Rs.
7,689,660
13,877,073
3,873,051
7,689,660
Vaccines
Vials
9,372,994
8,006,588
14,913,671
9,372,994
Rs.
477,630,816 469,048,675 733,972,132 477,630,816
Pre Fill Syringe
PFS
-
-
723,796
-
Rs.
-
-
92,961,982
-
Injections
Vials
122,833
278,932 66,104
122,833
Rs.
309,429
715,923
23,805
309,429
Husk
Gms
9
13,249
-
9
Rs.
203
402,623
-
203
Kit
Nos.
-
5,663
-
-
Rs.
-
1,400,800
-
-
Granules
Nos.
-
-
4,244,340
-
Rs.
-
-
4,872,951
-
Total
Rs.
628,388,556 673,265,103 941,132,277 628,388,556
b) Trading Activities
Tablets
Nos.
12,708,601
14,955,314
14,665,408
12,708,601
Rs.
27,372,156
27,768,077
23,835,584
27,372,158
Capsules
Nos.
3,449,624
3,770,084
2,454,871
3,449,624
Rs.
12,941,050
9,383,668
6,923,483
12,941,050
Syrups / Liquids
Ml
23,796,760
12,302,790
11,143,960
23,796,760
Rs.
3,171,290
1,985,763
1,559,658
3,171,290
Gels
Gms
89,460
-
1,830
89,460
Rs.
48,430
-
876
48,430
Injections
Vials
15,422
10,272
58,533
15,422
Rs.
12,210,592
1,075,732
11,716,770
12,210,592
Biscuits
Nos.
3,659
1,431
-
3,659
Rs.
76,730
28,645
-
76,730
Granules
Nos.
-
-
1,330,725
-
Rs.
-
-
689,458
-
Total
Rs.
55,820,248 40,241,885
44,725,829
55,820,250
c) Others*
Nos.
-
-
-
-
Rs.
-
-
-
-
Total
Rs.
-
-
-
-
Rs.
684,208,804 713,506,988 985,858,106 684,208,806
Grand Total
Sample / Destroyed /
Expired / Shortages
Current Previous Year
Year
Sales
Current
Year
Previous
Year
4,550,993 9,204,439
-
-
2,091,314 4,122,595
-
-
2,183,150 13,309,190
-
-
1,132,500 1,144,810
-
-
295,038
576,035
-
-
46,492
-
-
-
45,449
182,731
-
-
85
13,736
-
-
-
5903
-
-
102,225
-
-
-
-
-
519,134,777 454,749,204
1,210,177,962 1,051,472,608
66,937,771
48,607,590
557,856,427 453,957,048
265,578,970 272,688,670
110,582,967 125,338,987
30,238,280
76,494,050
35,179,463
76,635,951
44,718,100
67,564,946
5,277,342,364 6,324,557,847
909,481
142,003,221
467,936
561,473
3,278,010
6,050,327
(76)
(496)
(2,097)
(15,465)
-
(240)
-
(56,165)
13,292,400
16,494,980
7,352,913,297 8,037,941,138
4,149,231
-
1,404,069
-
4,201,200
-
5,700
-
2,819
-
7,867
-
-
-
-
-
-
-
-
49,202,158
42,365,574
240,420,372 208,427,041
6,654,519
7,600,364
35,693,185
43,880,361
39,995,770
35,583,300
12,547,652
11,218,568
(80,880)
1,329,420
(102,920)
1,681,810
105,112
84,006
47,473,275
33,496,655
(4,208)
30,375
(162,354)
1,314,545
505,005
1,640,666
337,509,876 300,018,980
-
39,994,426
3,71,804
39,994,426
3,71,804
7,730,417,599 8,338,331,922
5,928,120
-
1,085,246
-
9,460,820
-
5,520
-
1,129
-
60,066
-
-
-
-
-
-
-
-
*Sales of Raw Material
C.
Purchase of Finished goods
Products
Tablets
Capsules
Syrups/Liquids
Gel
Injections
Biscuits
Others
Total
Units
Nos. Rs.
Nos. Rs.
Ml.
Rs.
Gms.
Rs.
Vials
Rs.
Nos.
Rs.
Gms.
Rs.
Rs.
92
Current Year
55,308,196 100,757,694 7,063,835 19,211,568 31,544,170 4,920,952 (162,810) (75,949) 151,042 29,913,166 -
-
1,835,730
1,143,558
155,870,989
Previous Year
46,046,980
104,564,041
8,365,150
28,797,661
56,538,090
8,599,667
1,424,400
663,533
90,285
29,088,706
92,668
1,255,728
172,969,336
D.
Consumption of Raw materials & Packing materials
Products
Current Year
Oty. (In doses)
Polio Virus
879,425,400
Others*
Total
Value
Previous Year
Oty. (In doses)
Value
1,824,633,064
1,355,217,338
1,146,965,663
2,971,598,727
2,729,473,985
767,136,323
3,496,610,308
Current Year
4,571,336,927
457,267,055
Previous Year
2,742,992,185
193,149,620
Particulars
Current Year
Previous Year
Know-how Fee
Royalty
Interest
Professional & Consultation Fees Other Expenses
- Patents, Trade Marks & Product Registration
- Advertising and Sales Promotion
- Printing & Stationery
- Commission on Sales
- Market Research
- Others
12,847,257
38,025
206,189,558
54,682,275
8,619,193
272,321
59,439,075
29,761,306
26,319,097
5,258,076
110,588
65,806,641
30,286,500
39,604,033
23,392,134
33,165,756
3,337,007
44,655,446
27,471,615
* Items comprised in others are individually less than 10% of total value
E.
F.
G.
Value of Imports on CIF basis (on accrual basis)
Particulars
Raw Materials & Packing Materials
Capital Goods Expenditure in Foreign Currency (on accrual basis)
Earnings in Foreign Exchange (on accrual basis)
Particulars
F.O.B. value of Exports (including deemed export of Rs.3,708,466,456 (Previous Year Rs.5,797,333,245)
R & D Services (Know-how) Income
Interest on Exchange Earners Foreign Currency Deposits
Interest received on loan from Joint Venture Company
Interest accrued but not dueon loan from subsidiary company
H.
I. 1,699,562
-
16,868,753
28,887,763
3,867,030
637,893
1,993,346
-
Particulars
Current Year
Amount in Rs.
% age
Previous Year
Amount in Rs.
% age
Indigenous
Imported
Total
605,547,690
2,366,051,037
2,971,598,727
493,086,486
3,003,523,822
3,496,610,308
20.38
79.62
100.00
14.10
85.90
100.00
Value of Imported/Indigenous Stores & Spares consumed
Current Year
Amount in Rs.
% age
Indigenous
Imported
Total
163,479,798
28,564,016
192,043,814
85.13
14.87
100.00
Previous Year
Amount in Rs.
% age
117,958,440
19,447,028
137,405,468
86.00
14.00
100.00
Current Year
Previous Year
1,045,000
1
1,045,000
1,045,000
1
1,045,000
Remittance in foreign currency on account of dividend
Particulars
Dividend on Equity Shares *
Number of Non-resident Equity Shareholders
No. of Equity Shares held by them
*
93
Previous Year
6,414,111,800
Value of Imported/Indigenous Raw Materials & Packing Materials consumed
Particulars
J.
Current Year
5,588,991,868
Dividend of Rs.1,045,000 pertains to 2007-08 (Previous year Rs.1,045,000 pertains to 2006-07).
16. The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity
on departure at 15 days salary (last drawn salary) for each completed year of service subject to maximum of Rs.350,000 (except
in case of Managing/ Joint Managing/ Whole-time Director). The scheme is funded with an insurance company in the form of a
qualifying insurance policy.
The following tables summarize the components of net benefit expense recognized in the Profit & Loss Account and the funded
status and amounts recognized in the Balance Sheet for the respective plans:
Profit and Loss Account
Net employee benefit expense - Gratuity (recognized in Employee Cost)
Current service cost
Interest cost on benefit obligation
Expected return on plan assets
Net actuarial (gain)/loss recognized in the year on account of return on plan assets
Net benefit expense*
Actual return on plan assets
2008-09
2007-08
13,052,834
65,18,123
(27,03,704)
(3,739,708)
13,127,545
(3,501,808)
8,588,570
4,289,016
(1,969,518)
25,476,835
36,384,903
(2,320,968)
*Includes Gratuity expense of Rs.1,062,491 (Previous Year Rs.3,287,690) accounted under Research & Development Expenses.
Balance Sheet
Details of Provision for gratuity
Defined benefit obligation
Fair value of plan assets
Less: Unrecognized past service cost Plan (liability)
2008-09
2007-08
99,512,513
42,757,742
56,754,771
(56,754,771)
86,908,312
29,229,237
57,679,075
(57,679,075)
Changes in the present value of the defined benefit obligation for gratuity are as follows:
Opening defined benefit obligation
Interest cost
Benefits paid
Actuarial (Gain)/losses on obligation
Closing defined benefit obligation
2008-09
2007-08
86,908,312
6,518,123
13,052,834
-
(4,025,152)
(2,941,604)
99,512,513
53,612,703
4,289,016
8,588,570
(5,410,262)
25,828,285
86,908,312
Changes in the fair value of plan assets for gratuity are as follows:
Opening fair value of plan assets
Expected return
Contributions by employer
Benefits paid
Actuarial Gain /(losses)
Closing fair value of plan assets
2008-09
2007-08
29,229,237
2,703,704
14,051,849
(4,025,152)
798,104
42,757,742
21,292,086
1,969,518
11,026,445
(5,410,262)
351,450
29,229,237
The Company has since contributed Rs.14,809,973 to the gratuity fund.
The major categories of plan assets as a percentage of the fair value of total plan assets for gratuity are as follows:
2008-09
2007-08
Investments with insurer
Cash and bank balance with the insurer
100.00%
-
100.00%
-
The overall expected rate of return on assets is determined based on the market prices prevailing on that date, applicable to the
period over which the obligation is to be settled. There has been significant change in expected rate of return on assets due to
the improved debt market scenario.
The principal assumptions used in determining gratuity for the Company’s plans are shown below:
2008-09
Discount rate
7.50%
Expected rate of return on plan assets
9.25%
Increase in compensation cost
5.00%
Employee turnover
upto 30 years
10.00%
above 30 years but upto 44 years
5.00%
above 44 years
1.00%
94
2007-08
8.00%
9.25%
5.50%
10.00%
5.00%
1.00%
The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and
other relevant factors, such as supply and demand in the employment market.
Gratuity amounts for the current and previous three periods are as follows:
2008-09
2007-08
2006-07
99,512,513
86,908,312
53,612,703
Plan assets
42,757,742
29,229,237
21,292,086
Deficit
56,754,771
57,679,075
32,320,617
Experience adjustments on plan liabilities - (gain)/Loss
(3,269,245)
-
Experience adjustments on plan assets - (gain)/Loss
(798,104)
-
Note: The revised accounting standard AS-15 – Employee Benefits which provides for Actuarial Valuation of Gratuity Liability was adopted in
the year 2006-07. In the earlier years, actuarial valuation was done in accordance with the pre-revised Accounting Standard, AS-15. Accordingly,
comparative numbers of two years earlier than the year 2006-07 have not been furnished.
Defined Contribution Plan:
2008-09
Contribution to Provident Fund Charged to Profit and Loss Account
31,045,359
2007-08
25,677,410
The Company expects to contribute Rs.17,500,000 to gratuity fund in the year 2009-10.
17. The Company has incurred expenditure on Pre-Clinical Development studies amounting to Rs.123,978,449 during the year
(Previous Year Rs.185,575,387). This expenditure relates to studies carried out by Clinical Research Organization (CRO) towards
obtaining registration of Company’s products in US and / or Europe. The expenditure incurred has been capitalized and carried in
Capital Work in Progress. Management believes that it is in the nature of development expenditure and meets the capitalization
criteria set out in Accounting Standard 26 on Intangible Assets notified by the Companies (Accounting Standards) Rules, 2006
due to the following reasons:
•
the expenditure is not towards basic research and therefore no New Chemical Entity comes into being. Basic research is
conducted by the Company in its own R&D centers, but such developmental work is performed through external agencies
(CROs). Safety profile of the basic molecule is well established in several countries in Europe and in India and the product is
being marketed successfully in several countries under different brand names.
•
there is no experience to suggest that the studies conducted by CROs on behalf of the Company would lead to or make it
difficult for the Company to obtain regulatory approvals in US and / or Europe.
The management believes that these products would be commercially viable and there is no reason to believe that there is any
uncertainty that may lead to not securing registration for the products from regulatory authorities in US and / or Europe.
18. In accordance with Accounting Standard 9 on ‘Revenue Recognition’ notified by the Companies (Accounting Standards) Rules,
2006, Excise Duty on turnover amounting to Rs.18,845,112 (Previous year Rs.37,756,574) has been reduced from turnover in Profit
& Loss Account and differential Excise Duty on opening and closing stock of finished goods amounting to Rs. Nil (Previous year
Rs. Nil) has been adjusted from Raw Materials, Finished Goods, Work in Progress and Job Processing charges in Schedule XIII.
19. The Company has exercised the option as per the Companies (Accounting Standards) Amendment, Rules, 2009. As per the option
exchange differences related to long term foreign currency monetary items so far as they relate to the acquisition of a depreciable
capital assets are capitalized and depreciated the same over the useful life of the assets and in other cases, have transferred to
Foreign Currency Monetary Item Translation Difference Account and amortized over the balance period of such long term assets/
liabilities but not beyond accounting period ending on or before 31st March 2011, the unamortized balance in this account is
Rs.95,961,134 (Previous year Rs. Nil).
20. The Company is in the process of appointing independent consultants for conducting a Transfer pricing study to determine
whether the transactions with associated enterprises were undertaken at “arms length basis”. The management confirms that
all international transactions with associated enterprises are undertaken at negotiated contracted prices on usual commercial
terms. Further there has been no change in the terms of such international transactions till March 31, 2009.
21. Previous year’s figures have been rearranged and reclassified wherever necessary to make them comparable with the current
year’s figures.
S.R. Batliboi & Co.
Ravinder Jain
Managing Director
per Manoj Gupta
I.K. Sharma
Dr. Rajesh Jain
Partner
Place : New Delhi
Dated: May 27, 2009
95
Vinod Goel
ADDITIONAL INFORMATION AS REQUIRED UNDER PART IV
OF SCHEDULE VI TO THE COMPANIES ACT, 1956
1.
Registration Details
Registration No. Balance Sheet Date
2.
Capital raised during the year (Amount in Rs. Thousand)
Public Issue Bonus Issue
3.
Position of mobilization and deployment of Funds (Amount in Rs. Thousand)
Total Liabilities Source of Funds
Paid up Capital 66,786
Secured Loans 4,835,939
Application of Funds
Net Fixed Assets Net Current Assets Misc. Expenditure (to the extent not W/off )
Accumulated Losses 4.
Performance of Company (Amount in Rs. Thousand)
Turnover (Including Other Income)
Profit/Loss Before Tax Earnings per share (Rs.) 5.
Generic Name of Three Principal Products/ Services of Company
Item Code No. (ITC Code) Product Description Item Code No. (ITC Code) Product Description Item Code No. (ITC Code) Product Description 22350
State Code
16
Nil Right Issue Nil
Nil
Private Placement
Nil
31/03/2009
13,488,214
Total Assets 13,488,214
Reserves & Surplus 6,084,707
Unsecured Loans 2,166,996
6,938,703
Investments 2,165,698
4,284,200
Foreign Currency Monetary
333,786
3,652
Item Translation Difference Account
95,961
Nil
7,993,849 Total Expenditure 923,741
8,917,590
Profit/Loss after Tax 10.35
690,497
Dividend @ Nil
3002 20 14
Vaccine-Polio
3004 20 99
Gliclazide Tab
3004 90 67
Nimesulide Tab
Ravinder Jain
Managing Director
I.K. Sharma
Place : New Delhi
Dated: May 27, 2009
Vinod Goel
96
Dr. Rajesh Jain
CASH FLOW STATEMENT ANNEXED TO BALANCE SHEET
FOR THE YEAR ENDED 31ST MARCH, 2009
Amount in Rs.
Previous Year
Current Year
A. Cash Flow from Operating Activities:
Net Operating Profit/(Loss) before Tax & Extraordinary Items
(923,740,873)
Adjustments for:
Depreciation
705,099,242
430,008,915
Interest Expenses
321,070,800
116,324,021
Provision for Doubtful Debts & Advances
384,794
27,044,708
Interest Income
(168,062,520)
(46,007,840)
Dividend Income
(18,367,280)
(Profit)/ Loss on sale of Fixed Assets (Net)
(7,171,144)
(22,887,632)
(Profit)/ Loss on sale of Investments
(1,257,126)
(8,062,060)
Intangibles written off
-
2,103,721
Unrealized foreign exchange loss/(gain) (net)
1,675,903,989
(102,855,667)
Amortised exchange differences
47,980,567
Deferred Revenue Expenditure written off during the year
1,682,400
1,682,400
Provision for Impairment & Doubtful Loan
284,178,318
2,841,442,040
-
Operating Profit before Working Capital changes
1,917,701,167
(Increase)/ Decrease in Trade and Other Receivables
221,686,892
(489,944,478)
(Increase)/ Decrease in Inventories
(2,361,589,208)
(34,819,396)
Increase/ (Decrease) in Current Liabilities & Provisions
507,284,405
(1,632,617,911)
(287,252,490)
Cash generated from Operations
285,083,256
Net Income Taxes Paid
235,177,426
Net cash from Operating Activities
49,905,830
B.
Cash flow from Investing Activities:
(1,614,772,785)
(1,647,516,871)
Proceeds of deposits matured (with maturity
1,250,968,300
402,060,214
more than three months)
Deposits (with maturity more than three months)
(70,467,843)
(1,250,968,300)
Trade Investment in Shares of Joint Venture/ Subsidiary Companies
(283,200,650)
(1,791,200,000)
Non-trade Investment in Shares of Associate
(41,257,126)
(40,000,000)
Loan to Joint Venture & Subsidiary Companies
(747,317,829)
(39,778,050)
Sale of Non-trade Investments in Partnership Firm
41,257,126
19,428,500
Sale of Fixed Assets
42,514,714
30,654,398
Interest Received
142,045,313
46,499,370
Dividends received
18,367,280
Net cash used in investing activities
(1,261,863,500)
Net cash from Operating and Investing Activities
(1,211,957,670)
C.
Cash flow from Financing Activities:
Net increase / (Decrease) in Working Capital Borrowings
1,265,036,897
251,094,912
Long Term Borrowings raised
840,998,055
1,787,500,000
Fixed Deposits received
300,500,000 436,110,000
Fixed Deposits repaid
(436,110,000)
(169,390,000)
Interest paid
(321,130,220)
(119,446,466)
Dividend paid
(66,693,746)
(65,706,192)
Tax paid on Dividend Distribution
(11,334,602)
(11,166,767)
Net Cash from Financing activities
1,571,266,384
Net Cash from Operating, Investing & Financing Activities
359,308,714
Net increase in Cash & Cash equivalent
359,308,714
Opening balance of Cash & Cash equivalent
160,834,507
Closing balance of Cash & Cash equivalent
520,143,221
Components of cash and cash equivalents:
i) Cash Balance on Hand
579,589
ii) Balance with Scheduled Banks :
a) In Current Accounts
25,557,539
b) In Unpaid Dividend Accounts*
1,583,956
c) On Fixed Deposits
70,467,843
d) In Exchange Earner Foreign Currency Current Accounts
496,620,469
Cash & Bank Balances as per Schedule VII
594,809,396
Less: Fixed deposits for maturity period more than 3 months
(70,467,843)
524,341,553
Less: Effect of Exchange Differences on Cash & Cash Equivalents held in foreign currency
(4,198,332)
520,143,221
Cash & Cash Equivalents in Cash Flow Statement
1,903,858,280
397,350,566
2,301,208,846
(812,016,364)
1,489,192,482
336,539,746
1,152,652,736
(4,270,820,739)
(3,118,168,003)
2,108,995,487
(1,009,172,516)
(1,009,172,516)
1,169,181,050
160,008,534
1,449,297
33,723,242
1,536,608
1,250,968,300
124,125,360
1,411,802,807
(1,250,968,300)
160,834,507
(825,973)
160,008,534
* These balances are not available for use by the Company as they represent corresponding unpaid dividend liabilities.
S.R. Batliboi & Co.
per Manoj Gupta
Partner
I.K. Sharma
Place : New Delhi
Dated : May 27, 2009
97
Vinod Goel
Ravinder Jain
Managing Director
Dr. Rajesh Jain
STATEMENT U/S 212 OF THE COMPANIES ACT, 1956 RELATING TO SUBSIDIARY COMPANIES
1. Name of the Company
Best On Radicura & Panacea
Panacea Sunanda
Health Ltd.
Co. Ltd.* Hospitality Educational
Steel
Pvt. Ltd.*
Institute
Co. Ltd.*
Pvt. Ltd.*
Umkal
Panacea
Panacea Panacea
Rees
Kelisia Kelisia Panacea
Medical
Biotec
Biotec,
Biotec Investments Holdings investment Biotec
Institute
GmbH#
Inc.
FZE
Ltd.
Ltd.† Holdings ( International)
Pvt. Ltd.
AG† †$
SA† † †$
2. Date from which they became subsidiary company
15th March, 16th July, 23rd Aug, 23rd Aug,
5th Sep,
30 June, 11th June, 15th July, 16th March, 16th Sep., 18th Sep., 22nd Oct., 19th Feb.,
2000
1999
2007
2007
2007
2008
2008
2008
2008
2008
2008
2008
2009
3. Financial Year of the subsidiary ended on
31st March, 31st March, 31st March, 31st March, 31st March, 31st March, 31st March, 31st March, 31st March, 31st March, 31st March,
-
2009
2009
2009
2009
2009
2009
2009
2009
2009
2009
2009
4. Shares of the subsidiary held by Panacea Biotec Ltd. on the above dates
i) Number & 1,902,160 1,98,250
100,000
100,000
500,000 3,765,701
Nil
Nil
5
1,000
1000
1000
1000
Face Value Re.1
Rs.10
Re.1
Re.1
Re.1
Rs.10
-
- AED 100000 US $ 0.01
€ 1
CHF 100
CHF 100
ii) Extent of holding
100%
100%
100%
100%
100%
75.2%
100%
100%
100%
100%
100%
100%
100%
5. Net aggregate Profit or (Loss) for the current year (in Rs.)
23,257,105 (373,584) (95,257) (94,101) (46,368)
812,693
59,639 (485,926) (82,560) (1,706,647) (41,380,725) (817,345) (312,976)
6. Net aggregate amounts of the Profits or (Losses) of the subsidiary so far as it concerns the members of the holding company and is dealt with in the accounts of holding company:
a. for the financial year of the subsidiary
-
-
-
-
-
-
-
-
-
-
-
-
b. for the previous financial years of the subsidiary since it became its subsidiary
-
-
-
-
-
-
-
-
-
-
-
-
7. Net aggregate amounts of the Profits or (Losses) of the subsidiary so far as it concerns the members of the holding company and is not dealt with in the accounts of holding company
a. for the financial year of the subsidiary
23,257,105 (373,584) (95,257) (94,101) (46,368)
812,693
59,639 (485,926) (82,560) (1,706,647) (41,380,725) (817,345) (312,976)
b. for the previous financial years of the subsidiary since it became its subsidiary
11,613,577
222,031
-
- (126,440)
-
-
-
-
-
-
-
*
Wholly owned subsidiary till 24.01.08 and became indirect subsidiary through Best On Health Ltd. from 25.01.08.
Indirect Subsidiary through Rees Investments Ltd.
†
† † Indirect Subsidiary through Kelisia Holdings Ltd.
† † † Indirect Subsidiary through Kelisia Investment Holdings AG.
Unaudited.
#
$
The first financial year shall and on 31st March, 2010. For consolidation purposes the unaudited management accounts for the period upto 31st March, 2009 has been taken into account.
Ravinder Jain
Managing Director
I.K. Sharma
Place : New Delhi
Dated : May 27, 2009
Vinod Goel
Dr. Rajesh Jain
FINANCIAL DETAILS OF SUBSIDIARY COMPANIES:
Name of the Company
Best On Radicura & Panacea
Panacea Sunanda
Health Ltd.
Co. Ltd.* Hospitality Educational
Steel
Pvt. Ltd.*
Institute
Co. Ltd.*
Pvt. Ltd.*
Umkal
Panacea
Panacea Panacea
Rees
Kelisia Kelisia Panacea
Medical
Biotec
Biotec,
Biotec Investments Holdings investment Biotec
Institute
GmbH#
Inc.
FZE
Ltd.
Ltd.† Holdings (International)
Pvt. Ltd.
AG† †$
SA† † †$
As on 31st March, 2009
Capital
8,538,826 1,982,500
100,000
100,000
500,000 16,984,817 1,688,503
5,072 6,947,930
507
67,525 4,450,198
4,450,197
Reserves & Surplus
2,029,644,520 8,481,818 (95,257) (94,101) (172,808) 50,184,267
61548 (542,704) (92,209) (1,906,108) (42,574,383) (854,903)
(332,354)
Total Assets
2,068,018,228 324,467,400 299,018,440 319,630,000 213,235,206 67,169,084 1,817,591
532,741 7,007,767 738,063,847 716,433,985 5,540,015
4,804,013
Total Liabilities
2,068,018,228 324,467,400 299,018,440 319,630,000 213,235,206 67,169,084 1,817,591
532,741 7,007,767 738,063,847 716,433,985 5,540,015
4,804,013
Details of Investment
-
100,000
-
-
-
76,354
- 649,777,352
(except in case of
Investment in Subsidiary)
For the year/ period ended 31st March, 2009
Turnover (including other
43,159,027
86,061
13,653
13,160
3,144 1,516,249
198,969
- 25,020,017
-
-
9,306
income)
Profit/ (Loss) before tax
36,917,373 (373,217) (91,038) (90,034) (40,345) 1,293,940
59,639 (485,926) (82,560) (1,706,647) (41,380,725) (810,538)
(314,915)
Provision for Tax
13,660,268
(367)
4,219
4,067
6,023
481,247
-
-
0
6,807
(1,939)
Profit after Tax
23,257,105 (373,584) (95,257) (94,101) (46,368)
812,693
59,639 (485,926) (82,560) (1,706,647) (41,380,725) (817,345)
(312,976)
Proposed Dividend
-
-
-
*
Wholly owned subsidiary till 24.01.08 and became indirect subsidiary through Best On Health Ltd. from 25.01.08.
†
Indirect Subsidiary through Rees Investments Ltd.
† † Indirect Subsidiary through Kelisia Holdings Ltd.
† † † Indirect Subsidiary through Kelisia Investment Holdings AG.
#
Unaudited.
$
The first financial year shall and on 31st March, 2010. For consolidation purposes the unaudited management accounts for the period upto 31st March, 2009 has been taken into account.
Note: In terms of approval granted by the Central Government under section 212(8) of the Companies Act,1956, a copy of the Balance Sheet, Profit & Loss Account , Report of the Board of Directors and the report of the Auditors
of the subsidiary companies have not been attached with the annual report of the Company. The Company will make available these documents and the related details upon request by any investor of the Company and of its
subsidiary. These documents will also be available for inspection by any investor at the Head office of the Company and subsidiary company concerned.
98
AUDITORS’ REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS
To
The Board of Directors of Panacea Biotec Limited on
Consolidated Financial Statements of Panacea Biotec
Limited, its Subsidiaries, Associates and Joint Venture.
1.
2.
3.
4.
99
We have audited the attached consolidated balance
sheet of Panacea Biotec Limited (“the Company”), its
Subsidiaries, Associates and Joint Ventures (“the Group”),
as at March 31, 2009 and also the consolidated profit and
loss account and the consolidated cash flow statement
for the year ended on that date annexed thereto. These
financial statements are the responsibility of the Panacea
Biotec Limited’s management and have been prepared
by the management on the basis of separate financial
statements and other financial information regarding
components. Our responsibility is to express an opinion
on these financial statements based on our audit.
We conducted our audit in accordance with auditing
standards generally accepted in India. Those Standards
require that we plan and perform the audit to obtain
reasonable assurance about whether the financial
statements are free of material misstatements. An audit
includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles
used and significant estimates made by management,
as well as evaluating the overall financial statement
presentation. We believe that our audit provides a
reasonable basis for our opinion.
a)
b)
We have not audited the financial statements
of the Subsidiaries, Associates & Joint Ventures,
whose financial statements reflect Group’s share
of total assets of Rs.3,148,633,765 as at 31st March
2009, the total revenue of Rs.193,833,144 and net
cash outflows of Rs.12,648,424 for the year then
ended as considered in the consolidated financial
statements. These financial statements and other
financial information of the Subsidiaries, Associates
and Joint Ventures have been audited by other
auditors whose report have been furnished to us,,
and our opinion, in so far as it relates to the amount
included in respect of these Subsidiaries, Associates
and Joint Ventures, is based solely on the report of
other auditors.
The consolidated financial statements of Panacea
Biotec Limited include assets, revenues and cash
flows of Rs.6,065,292, Rs.209,361 and Rs.6,056,017
respectively in relation to Group’s share in certain
Subsidiaries (Panacea Biotec GmbH, Germany, Kelisia
Investment Holding S.A.-Switzerland and Panacea
Biotec (International) S.A.-Switzerland), based
on unaudited financial statements. The effect of
adjustments, if any, that may have been required to
be made to the accompanying consolidated financial
statements, had those component been audited, is not
currently ascertainable.
We report that the consolidated financial statements
have been prepared by the Company’s management
in accordance with the requirements of Accounting
Standard (AS) 21, Consolidated financial statements,
Accounting Standard (AS) 23, Accounting for Investments
in Associates in Consolidated Financial Statements, and
Accounting Standard (AS) 27, Financial Reporting of
Interests in Joint Ventures, notified pursuant to the
Companies (Accounting Standards) Rules 2006.
5.
Without qualifying our opinion, we draw attention to
Note 3(ii) of Schedule XX B to the financial statements
regarding non-provision of proportionate premium on
redemption of ‘US$ 50 Million Zero Coupon Convertible
Bonds due 2011’ amounting to Rs.470,992,269. The same
has been disclosed as a contingent liability. Management
has represented, that the redemption premium will be
offset against the securities premium account and, hence,
no adjustments have been made to the accompanying
statement of results.
6.
Without qualifying our opinion, we draw attention to
Note 14 of Schedule XX B to the financial statements
regarding capitalization of expenditure on clinical trials
amounting to Rs.123,978,449. The ultimate approval of
such products, which has been considered as highly likely
by the management, is not within direct control of the
entity. Pending such final approval, no adjustments have
been made to the accompanying financial statements.
7.
Without qualifying our opinion, we draw attention that
the Company has incurre managerial remuneration
of Rs.63,035,463 during the year, which is in excess of
the limits specified by the relevant provisions of the
Companies Act, 1956, by Rs.38,169,706. The Company
has made an application to the appropriate regulatory
authorities in this regard, for payment of such excess
remuneration to managerial personnel. Pending the final
outcome of the Company’s application, no adjustments
have been made to the accompanying financial
statements in this regard.
8.
Based on our audit on consideration of reports of other
auditors on separate financial statements and on the
other financial information of the components, and to the
best of our information and according to the explanation
given to us, we are of the opinion that the attached
consolidated financial statements, subject to matter
referred to para 3(b), the effect of which is not currently
ascertainable; give a true and fair view in conformity with
the accounting principles generally accepted in India:
a)
in the case of the consolidated balance sheet, of the
state of the affairs of the Panacea Biotec Limited,
its Subsidiaries, Associates and Joint Ventures as at
March 31, 2009;
b)
in the case of the consolidated profit and loss
account, of the loss for the year ended on that date;
and
c)
in the case of the consolidated cash flow statement,
of the cash flows for the year ended on that date.
For S. R. Batliboi & Co.
per Manoj Gupta
Partner
Membership No.: 83906
Place : New Delhi
Date : May 27, 2009
CONSOLIDATED BALANCE SHEET AS AT 31st MARCH, 2009
Schedule
No.
As at
31st March, 2009
Amount in Rs.
As at
31st March, 2008
SOURCES OF FUNDS
1. Shareholders’ Funds
Share Capital
I
66,786,312
66,786,312
Reserves & Surplus
II
6,100,715,573 6,167,501,885
6,894,296,288 6,961,082,600
2. Minority Interest
28,968,930
3. Loan Funds
Secured Loans
III
4,836,102,165
2,073,841,714
Unsecured Loans
IV
2,193,996,000 7,030,098,165
1,912,075,828 3,985,917,542
4. Deferred Tax Liability (Net)
334,786,544
595,503,862
(Refer note no. 7 of Schedule XX B)
Total 13,561,355,524 11,542,504,004
APPLICATION OF FUNDS
1. Fixed Assets
Gross Block
V
9,025,576,963
6,064,572,427
Less : Depreciation/ Amortisation
2,213,043,241
1,561,222,398
Net Block
6,812,533,722
4,503,350,029
Capital Work-in-Progress (including Capital Advances)
1,777,023,749 8,589,557,471
2,221,722,544 6,725,072,573
2. Investments
VI
700,599,288
152,667,042
3. Foreign Currency Monetary item Translation
Difference Account (net of amortisation)
95,961,134
(Refer note no.2 of Schedule XXA and note no.16
of Schedule XXB)
4. Current Assets, Loans & Advances
VII
Inventories
4,513,037,066
2,145,753,362
Sundry Debtors
1,201,730,208
1,458,848,178
Cash & Bank Balances
748,422,730
1,546,803,344
28,502,889
32,033,240
Loans and Advances
1,233,020,316
932,108,380
Sub-Total (A)
7,724,713,209
6,115,546,504
Less : Current Liabilities & Provisions
VIII
Current Liabilities
1,692,582,309
1,237,386,042
Provisions
1,861,052,904
218,862,398
Sub-Total (B)
3,553,635,213
1,456,248,440
Net Current Assets (A)-(B) 4,171,077,996 4,659,298,064
5. Miscellaneous Expenditure
IX
4,159,635
5,466,325
Total 13,561,355,524 11,542,504,004
Significant Accounting Policies and Notes to
Accounts
XX
The Schedules referred to above and notes thereon form an integral part of the Balance Sheet.
S.R. Batliboi & Co.
Ravinder Jain
Managing Director
per Manoj Gupta
Partner
I.K. Sharma
Dr. Rajesh Jain
Place : New Delhi
Dated: May 27, 2009
Vinod Goel
100
CONSOLIDATED PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED 31st MARCH, 2009
Schedule
No.
For the Year Ended
31st March, 2009
Amount in Rs.
For the Year Ended
31st March, 2008
INCOME
Turnover (Gross)
X
7,900,564,192
8,451,191,934
Less: Excise Duty
18,845,112 7,881,719,080
37,756,574
Other Income
XI
311,956,924
Total Income 8,193,676,004
EXPENDITURE
Purchases of Finished Goods
186,401,696
Raw and packing material consumed
XII 2,952,548,877
Operating and other expenses
XIII 3,393,917,326
(Increase) in inventories
XIV (452,622,474)
Personnel Expenses
XV
956,778,484
XVI
458,230,492
Research & Development Expenses
XVII
669,944,045
Financial expenses
XVIII
348,181,812
Depreciation/ Amortisation
V
545,172,635
Miscellaneous Expenditure written off during the year
IX
1,787,071
Total Expenditure 9,060,339,964
Profit Before Tax (866,663,960)
Provision for Income Tax
24,396,207
Provision for Income Tax for earlier years
89,323
Deferred Income Tax (Credit)/Charge (260,618,147)
(Refer note no.7 of Schedule XX B)
Provision for Fringe Benefit Tax
29,393,489
Profit After Tax (659,924,832)
Add: Balance brought forward from previous year 2,806,000,020
Add: Share of Profit in Partnership Firm
-
Add: Share of Profit/ (Loss) in Associate
5,306,590
Add: Share of Minority Interests in (Profit)/ Losses
(188,030)
Add: (Profit)/ Losses on the date of closure of Joint Venture
-
Profit available for Appropriations 2,151,193,748
APPROPRIATIONS
Dividend
- Equity Shares-Proposed (not liable to TDS)
-
- Preference Shares - Interim (not liable to TDS)
33,184
Dividend Distribution Tax
3,127,240
2,300,000
Balance carried to Balance Sheet 2,145,733,324
XIX
(9.90)
XIX
(9.90)
Face value per Share
1.00
Significant Accounting Policies and Notes to
Accounts
XX
8,413,435,360
382,935,788
8,796,371,148
183,130,827
3,469,053,324
780,786,184
(4,589,126)
980,414,224
482,787,420
541,856,123
150,677,689
334,533,723
1,695,701
6,920,346,089
1,876,025,059
340,994,978
212,707,641
32,505,702
1,289,816,738
1,675,618,296
699,983
(939,432)
52,002,560
3,017,198,145
66,693,746
11,334,602
133,169,777
2,806,000,020
19.51
18.25
1.00
The Schedules referred to above and notes thereon form an integral part of the Profit & Loss Account.
S.R. Batliboi & Co.
Ravinder Jain
Managing Director
per Manoj Gupta
Partner
I.K. Sharma
Dr. Rajesh Jain
Place : New Delhi
Dated: May 27, 2009
101
Vinod Goel
SCHEDULES TO CONSOLIDATED BALANCE SHEET AND PROFIT & LOSS ACCOUNT
As at
31st March, 2009
Amount in Rs.
As at
31st March, 2008
Schedule I - Share Capital
Authorised
Comprising of
i . 125,000,000 Equity Shares of Re.1 each (Previous
125,000,000
Year 125,000,000 Equity Shares of Re. 1 each)
ii. 110,000,000 (Previous year 110,000,000)
Preference Shares of Rs.10 each 1,100,000,000
1,225,000,000
Issued and Subscribed
66,842,746 Equity Shares of Re.1 each (Previous Year
66,842,746
66,842,746 Equity Shares of Re.1 each)
66,842,746
Paid up
66,693,746 (Previous Year 66,693,746) Equity Shares
66,693,746
66,693,746
of Re.1 each fully paid-up
Add: Forfeited Shares
(14,900 Shares @ Rs.10 each forfeited on May 15, 1999,
which were later on sub-divided into 149,000 Equity
Shares of Re.1 each on February 12, 2003)
92,566
66,786,312
92,566
125,000,000
1,100,000,000
1,225,000,000
66,842,746
66,842,746
66,786,312
(149,000 Forfeited Shares have been allotted on 24th August, 2005 in the name of
employees of the company for sale thereof at the prevailing market prices through
recognised Stock Exchanges on the terms & conditions as specified by Managing /
Joint Managing Directors or Director of the company and reimbursement
of net sales proceeds to the company account)
(Out of the above shares, 1,814,240 Equity Shares of Rs.10 each were issued as fully paid up
bonus shares by capitalisation of General Reserves in earlier years, which were later on
sub-divided into 18,142,400 Equity Shares of Re.1/- each on February 12, 2003)
66,786,312
66,786,312
Schedule II - Reserves and Surplus
1) Capital Redemption Reserve
Amount as per last Balance Sheet 1,016,849,140
2) Securities Premium
Amount as per Last Balance Sheet
2,785,103,626
2,456,358,602
Add : Credited Upon Issue of Equity Shares on
-
326,481,758
conversion of FCCBs
Add : Credited Upon Issue of Equity Shares
- 2,785,103,626
2,263,266
3) General Reserve
279,334,119
146,164,342
Add : Transfer from Profit & Loss Account
2,300,000
133,169,777
Less: Exchange Differences of Earlier Years capitalised
37,586,515
to Fixed Assets (Net of Depreciation Rs.1,609,882)
(Refer note no.2 of Schedule XX A and note
no.16 of Schedule XX B)
Less: Exchange Differences of Earlier Years Transferred
92,470,318
151,577,286
-
to the “Foreign Currency Monetary item
Translation Differences Account” (Refer note no.2 of
Schedule XX A and note no.16 of Schedule XX B)
4) Foreign Currency Translation Reserve
7,009,383
1,394,060
Less : Transfer to P&L Account
7,009,383
Add : Additions during the year
1,452,197
1,452,197
5,615,323
5) Balance in Profit & Loss Account
2,145,733,324
6,100,715,573
102
1,016,849,140
2,785,103,626
279,334,119
7,009,383
2,806,000,020
6,894,296,288
As at
31st March, 2009
Amount in Rs.
As at
31st March, 2008
Schedule III - Secured Loans
1.
Foreign currency term loans (from banks)
i)
State Bank of India
(Due within one year Rs. nil (Previous year Rs. nil)
Interest Accrued & Due
2,028,800,000
802,100,000
12,416,668
4,974,266
ii)
State Bank of Travancore
(Due within one year Rs. nil (Previous year Rs. nil)
1,272,932,614
1,006,525,285
2.
Working Capital Loans from Scheduled Banks
1,521,789,762
256,752,865
3.
Finance Lease Obligation
-
3,083,078
4.
Loan against Hypothecation of Car
163,121
406,220
4,836,102,165
2,073,841,714
Notes:
1.
Foreign Currency Term Loans from State Bank of India and State Bank of Travancore are secured by way of first pari-passu charge by hypothecation
of the Company’s entire movables fixed assets, both present and future and mortgage of immovable properties of the Company being land
admeasuring 96 bighas, 19 biswas & 93 bighas 12 biswas & 10 Biswasi situated at Village Samalheri, Tehsil Dera Bassi, District S.A.S. Nagar (Mohali)
(formerly Tehsil Rajpura, District Patiala), Punjab. The process for creation of first pari-passu charge by way of mortgage of immovable properties
situated at Baddi, Himachal Pradesh is in progress. Foreign Currency Term Loan from State Bank of India is also collaterally secured by personal
guarantees of the Promoter-Directors of the Company, viz. Mr. Soshil Kumar Jain, Mr. Ravinder Jain, Dr Rajesh Jain and Mr. Sandeep Jain.
2.
Working Capital Loans from Scheduled Banks are secured by way of first pari-passu charge by hypothecation of all current assets and also by way of
2nd pari-passu charge on all the movable fixed assets (including machinery and spares) of the company and existing immovable fixed assets of the
Company being land admeasuring 96 bighas, 19 biswas & 93 bighas 12 biswas & 10 Biswasi situated at Village Samalheri, Tehsil Dera Bassi, District
S.A.S. Nagar (Mohali), Punjab. The process for creation of second pari-passu charge by way of mortgage of immovable properties situated at Baddi,
Himachal Pradesh is in progress. These are also collaterally secured by personal guarantees of the Promoter-Directors of the Company, viz. Mr. Soshil
Kumar Jain, Mr. Ravinder Jain, Dr Rajesh Jain and Mr. Sandeep Jain.
Schedule IV - Unsecured Loans
Fixed Deposits*
(Due within one year Rs.55,000,000
Interest accrued & due
Other Loans:
Foreign Currency Convertible Bonds**
US$ 36,800,000 (Previous Year US$ 36,800,000) Zero Coupon Convertible Bonds due 2011
(Due within one year nil (Previous Year nil)
Loan from Lakshmi & Manager Holdings Ltd.
300,500,000
436,110,000
-
101,828
1,866,496,000
1,475,864,000
27,000,000
-
2,193,996,000
1,912,075,828
Note:
*
Includes Rs.300,000,000 (Previous Year Rs.432,500,000) from partnership firm in which some directors and their relatives are partners.
** Foreign Currency Convertible Bonds.
-
Unless previously converted, redeemed or repurchased & cancelled, the remaining FCCBs of US $ 36,800,000,which were issued on 13.02.2006, will
be redeemed on Feb 14, 2011 at 142.80% of their outstanding principal amount.
103
Additions
during
the Year*
Sale/Adj.
Other
As At
As At
during
Movements**
31/03/2009
01/04/2008
the Year
GROSS BLOCK
Provided
during
the Year
Sale/Adj.
during
the Year
Other
Movements**
DEPRECIATION/AMORTISATION
As At
31/03/2009
104
1.
Freehold Land includes Land amounting to Rs.17,285,690 (Previous Year Rs.17,285,690) pending registration in the name of the Company.
2.
Building includes Office Premises amounting to Rs.155,892,400 (Previous Year Rs.1,429,032) pending registration in the name of the Company.
3.
Plant & Machinery includes Plant & Machinery amounting to Rs.4,543,083 (Previous Year 5,277,132 ) (Net Block) lying with third parties.
4.
Depreciation for the year includes Depreciation on Research & Development Assets amounting to Rs.169,025,407 (Previous Year Rs.131,348,176).
5.
Capital Work in Progress includes pre-operative expenditure. Refer Note No.4 of schedule XX B.
6.
Addition to Fixed Assets includes foreign exchange adjustment amounting to Rs.641,013 {Previous Year (Rs.556,105)}.
7.
All Intangible assets (except Softwares) are internally generated Intangible assets.
* Includes exchange differences capitalized during the year Rs.730, 764,477(Previous year Rs. Nil).
** Exchange differences Loss / (Gain) of earlier years capitalized during the year.
Notes:
A. Tangible Assets
Land - Freehold
1,350,607,657
459,376,640
27,529,975
(45,339)
1,782,408,983
-
-
-
-
-
16,395,690
38,436,540
-
-
54,832,230
461,198
371,417
-
-
832,615
Land - Leasehold
Buildings
999,892,584
806,599,235
1,299,258
(1,552,944)
1,803,639,617
201,982,382 119,234,498
22,185
(155,294)
321,039,401
Leasehold Improvement
79,322,055
1,717,923
-
(556)
81,039,422
70,456,064
7,062,587
-
(56)
77,518,595
Plant & Machinery
2,568,106,165 1,692,953,103
12,443,034
(9,674,542)
4,238,941,692
789,770,773 459,068,853
6,921,701
(1,345,729)
1,240,572,196
228,888,540
60,786,271
76,076
(179,870)
289,418,865
98,739,656
33,355,906
(60,741)
(32,556)
132,123,747
Vehicles
121,431,089
32,153,001
8,933,733
(32,538)
144,617,819
59,795,717
20,211,662
5,807,349
(8,424)
74,191,606
Office Equipments
185,482,522
25,750,990
1,749,903
(61,083)
209,422,526
67,595,619
19,747,579
1,527,245
(8,497)
85,807,456
Computer Equipments
146,390,242
24,453,570
272,991
(148,314)
170,422,507
100,331,177
24,910,458
177,162
(59,326)
125,005,147
TOTAL (A)
5,696,516,544 3,142,227,273
52,304,970 (11,695,186)
8,774,743,661 1,389,132,586 683,962,960 14,394,901
(1,609,882)
2,057,090,763
Previous Year
3,728,463,680 1,984,556,368
16,503,504
-
5,696,516,544
988,283,570 408,882,721
8,033,705
-
1,389,132,586
B. Intangible Assets
Goodwill
176,755,030
26,217,370 166,723,422
-
36,248,978
64,482,126
3,336,925 44,917,772
-
22,901,279
Patents, Trademarks & Designs
58,763,187
4,584,400
5,292,947
-
58,054,640
45,277,213
3,030,790
1,442,207
-
46,865,796
78,654,895
8,111,565
19,987
-
86,746,473
41,681,169
13,524,682
12,437
-
55,193,414
Softwares
Website
9,202,695
-
-
-
9,202,695
9,202,695
-
-
-
9,202,695
Product Development
44,680,076
15,900,440
-
-
60,580,516
11,446,609
10,342,685
-
-
21,789,294
TOTAL (B)
368,055,883
54,813,775 172,036,356
-
250,833,302
172,089,812
30,235,082 46,372,416
-
155,952,478
Previous Year
324,146,922
43,918,761
9,800
-
368,055,883
115,096,857
56,999,178
6,223
-
172,089,812
TOTAL (A+B)
6,064,572,427 3,197,041,048 224,341,326 (11,695,186)
9,025,576,963 1,561,222,398 714,198,042 60,767,317
(1,609,882)
2,213,043,241
Previous Year
4,052,610,602 2,028,475,129
16,513,304
-
6,064,572,427 1,103,380,427 465,881,899
8,039,928
-
1,561,222,398
As At
01/04/2008
DESCRIPTION
Schedule V - Fixed Assets
(Amount in Rs.)
1,350,607,657
15,934,492
797,910,202
8,865,991
1,778,335,392
130,148,884
61,635,372
117,886,903
46,059,065
4,307,383,958
1,790,508,410
2,740,180,110
112,272,904
13,485,974
36,973,726
33,233,467
195,966,071
431,214,135
209,050,065
4,503,350,029
2,221,722,544
2,949,230,175
13,347,699
11,188,844
31,553,059
-
38,791,222
94,880,824
647,718,926
195,966,071
6,812,533,722
1,777,023,749
4,503,350,029
As At
31/03/2008
1,782,408,983
53,999,615
1,482,600,216
3,520,827
2,998,369,496
157,295,118
70,426,213
123,615,070
45,417,360
6,717,652,898
1,129,304,823
4,307,383,958
As At
31/03/2009
NET BLOCK
As at
31st March, 2009
Amount in Rs.
As at
31st March, 2008
Schedule VI - Investments
Long Term Investments (at cost)
A. Non-Trade - Quoted
a) 10,000 Equity Shares of Rs.10 each 100,000
fully paid of Medicamen Biotec Ltd.
- Unquoted
a) Investment in Capital of Partnership Firm -
40,000,000
“Lakshmi & The Manager” *
Add: Profit for the year
-
-
699,983
b) 41,257,126 (Previous Year Nil) Equity Shares
41,957,109
of Re.1 each fully paid up in Lakshmi &
Manager Holdings Ltd.
Add: Profit/ (Loss) for the year
(2,103,929)
39,853,180
-
B. Trade - Quoted
3,733,334 (Previous Year Nil) Equity Shares of 649,777,351
US $ 0.0001 each fully paid up in PharmAthene Inc.
- Unquoted
a) 419,767 (Previous Year 419,767) Equity Shares of 3,258,238
4,197,670
Rs.10 each fully paid in PanEra Biotec Pvt. Ltd.
(formerly known as Panheber Biotec Pvt. Ltd.)
Add : Profit / (Loss) for the year
7,410,519
10,668,757
(939,432)
b) Investment in Shivalik Solid Waste Management 200,000
Ltd. 20,000 (Previous year 20,000) Equity Shares
of Rs.10 each
c) 4,608,608 (Previous Year 4,608,608) Ordinary 168,068,998
Shares of GBP.0.01 (Face Value) each fully paid of
Cambridge Biostability Limited
Less : Provision for Permanent Diminution in the
168,068,998
-
value of Investments (Refer note no. 12(b)
of Schedule XX B)
-
Current Investment (at lower of cost or market value)
a) Nil Units (Previous Year 6,202,072.225) of
-
Rs.10.0315 NAV in HDFC CMF - Savings Plus
Plan - Whole Sale - Daily Dividend
b) Nil Units (Previous Year 45,885.50) of
-
Rs.1,001.1364 NAV in Reliance Liquid Plus
Fund - Inst - Daily Dividend
700,599,288
Notes:
*The names of all the partners of the Partnership Firm,
‘Lakshmi & The Manager’, total capital of the firm and
the share of each partner was as under:
Partners
Capital
Sharing Ratio
Panacea Biotec Ltd.
40,000,000
40%
Mr. Ravinder Jain
19,000,000
19%
Mrs. Radhika Jain
20,000,000
20%
Mrs. Sunanda Jain
18,000,000
18%
Mrs. Meena Jain
2,000,000
2%
Mrs. Shilpy Jain
1,000,000
1%
Total
100,000,000
100%
Aggregate value of Unquoted Investments
(net of Provision for Permanent Diminution in the value
of Investments of Rs.168,068,998)
Aggregate value of Quoted Investments
(Market value of Quoted Investment)
105
100,000
40,699,983
-
3,258,238
200,000
62,216,088
46,192,733
152,667,042
50,721,937
152,567,042
649,877,351
466,069,086
100,000
161,500
Amount in Rs.
As at
31st March, 2009
As at
31st March, 2008
Schedule VII - Current Assets, Loans & Advances
Inventories
i) Raw & Packing Materials
ii) Finished Goods
(Including goods in transit of Rs.1,192,568
(Previous Year Rs. Nil)) & lying with third parties
Rs.844,654 (Previous Year Rs.187,528)
iii) Work in Progress
iv) Stores & Spare Parts
Sundry Debtors
(Unsecured, Considered good, unless otherwise stated)
Over six months (including Rs.3,146,023 considered
doubtful of recovery (Previous year Rs.2,858,916))
Others Debts
Less : Provision for Bad & Doubtful Debts
Cash and Bank Balances
i) Cash balance on hand
ii) Balance with Scheduled Banks
a) On Current Accounts
b) On Unpaid Dividend Accounts*
c) On Fixed Deposits**
d) On Exchange Earner Foreign Currency
Current Accounts
3,206,936,066
1,321,160,291
1,020,726,983
713,360,132
202,833,537
57,577,914
82,540,480
4,513,037,066
53,655,025
83,446,581
9,640,735
1,121,429,650
1,204,876,231
3,146,023 1,201,730,208
1,452,066,359
1,461,707,094
2,858,916
9,243,607
2,653,554
100,130,657
1,583,956
140,844,041
496,620,469
748,422,730
104,179,993
1,536,608
1,314,307,829
124,125,360
2,145,753,362
1,458,848,178
1,546,803,344
*Not available for use by the company as they represent corresponding unpaid dividend liabilities
**Fixed Deposits amounting to Rs.1,024,123 (previous year Rs.9,718,300) are pledged with Banks
and various Government Authorities.
Export Benefits Receivable
25,521,973
19,402,794
Interest accrued but not due on Loans & Deposits
10,256,386
12,630,446
Less: Provision for doubtful of recovery
7,275,470
28,502,889
-
(Refer note no. 12(b) of Schedule XX B)
Loans and Advances
(Unsecured, Considered good, unless otherwise stated)
Advances recoverable in cash or in kind or for value to be
749,656,508
611,875,467
received (Including Rs.818,322
(Previous Year Rs.818,322 ) considered doubtful
Due from PanEra Biotec Pvt. Ltd. (Formerly known as 153,950,194
135,532,654
Panheber Biotec Private Ltd.)**
(Including Rs.135,532,654 (Previous Year Rs.135,532,654)
considered doubtful)
Balance with Excise, Custom etc. 15,042,362
24,870,402
Loan to Joint Venture Company
108,833,850
35,746,800
Staff Loans & Advances (including Rs.4,191,959
16,357,286
18,245,508
(Previous Year Rs.4,191,959) considered doubtful)
1,043,840,200
826,270,831
Less : Provision for Doubtful Loans & Advances
108,833,850
(Refer note no. 12(b) of Schedule XX B)
Less : Provision for Bad & Doubtful Advances
140,542,935
140,542,935
794,463,415
685,727,896
Security Deposits
23,446,850
43,242,929
Advance Income Tax (Net of Provision of Rs.1,180,600,195
415,110,051 1,233,020,316
203,137,555
(previous year Rs.1,166,163,348))
7,724,713,209
32,033,240
932,108,380
6,115,546,504
**Company’s two Directors are also directors in PanEra Biotec Private Limited (Formerly known as Panheber Biotec Pvt. Ltd.).
106
Amount in Rs.
As at
31st March, 2009
As at
31st March, 2008
Schedule VIII - Current Liabilities & Provisions
A.
Liabilities
i)
Acceptances
ii)
Sundry Creditors
a) Dues to Micro & Small Enterprises
(Refer note no.6 of Schedule XX B)
b)
Dues to other than Micro & Small Enterprises
1,140,108,339
345,202,563
1,274,843
1,177,455
482,859,566
750,328,794
iii) Advances from Customers
7,060,675
8,155,762
iv) Deposits from C & F Agents
15,195,000
15,158,000
v)
vi) Other Liabilities
Unpaid Dividend on Equity Shares*
vii) Book Overdraft
vii) Interest accrued but not due on loans/ Deposits
1,291,245
1,536,608
44,401,611
115,478,633
-
345,960
391,030
1,692,582,309
2,267
1,237,386,042
* This amount does not include amount due/outstanding
to be credited to Investor Education & Protection Fund,
same shall be credited as and when due.
B.
Provisions
i)
Provision for Wealth Tax
ii) Provision for Fringe Benefit Tax (Net of Advance Payment of Rs.72,954,545 (Previous
year Rs.75,650,670))
iii) Proposed Dividend on Preference Shares
iv) Proposed Dividend on Equity Shares
v)
Provision for Dividend Distribution Tax
1,371,020
832,746
5,174,455
2,349,330
33,184
-
-
66,693,746
5,640
11,334,602
vi) Provision for Gratuity
57,056,954
58,693,758
vii) Provision for Leave Encashment
54,307,651
38,458,216
viii) Provision for open Derivative Contracts
1,743,104,000
1,861,052,904
40,500,000
218,862,398
3,553,635,213
1,456,248,440
Schedule IX - Miscellaneous Expenditure
i)
License Fees
5,334,319
7,016,719
Less : Written off during the Year
1,682,400
1,682,400
Preliminary Expenses
ii)
3,651,919
132,006
5,960
Add : Addition during the year
480,381
126,046
Less : Written off during the year
104,671
507,716
-
132,006
4,159,635
5,466,325
5,334,319
For the year ended
31st March, 2009
Amount in Rs.
For the year ended
31st March, 2008
Schedule X - Turnover
Sales
Services (R&D Income)
Income from Contract Manufacturing
107
7,877,964,683
1,699,562
20,899,947
7,900,564,192
8,447,324,904
3,867,030
8,451,191,934
For the year ended
31st March, 2009
Amount in Rs.
For the year ended
31st March, 2008
Schedule XI - Other Income
Interest Received - from Banks (Tax deducted at source Rs.27,038,973
- from Inter Company Loans/ Deposits (Tax deducted at source Rs. Nil (Previous year Rs. Nil))
- from Others (Tax deducted at source Rs.7,455,603 (Previous year Rs.2,323,740))
- on Income Tax Refund
Export Incentives
Dividend on other than Trade Investments Long Term (Gross)
Miscellaneous Balances/Provisions written back
Sale of Scrap
Lease Rent
Profit on Sale of Fixed Assets {Net of loss Rs.2,039,733 (Previous year Rs.845,313)}
Foreign Exchange Fluctuation Gain {Net of loss Rs. Nil (Previous year Rs.160,515,539}
Profit on Sale of Investment
Insurance Claim Received
Royalty Income
Income from Derecognition of JV company
Foreign Currency Translation Account
Miscellaneous Income
127,865,846
49,217,313
16,878,059
35,037,872
-
30,855,454
5,453,494
123,707
1,779,942
17,823,031
6,937,487
-
1,257,126
4,430,371
9,266,380
46,263,349
7,009,383
975,422
311,956,924
7,268,691
6,527,472
24,814,711
3,468,309
123,151,118
1,769,296
180,133
22,830,661
124,897,841
8,283,596
1,235,464
9,291,183
382,935,788
Schedule XII - Raw & Packing Material Consumed
Raw Materials & Packing Materials Consumed
Opening Stock
Add : Material purchased during the Year Less : Closing Stock
Less: Material consumed for Research & Development
1,321,160,291
4,857,945,771
6,179,106,062
3,206,936,066
2,972,169,996
19,621,119 2,952,548,877
1,261,054,515
3,562,049,427
4,823,103,942
1,321,160,291
3,501,943,651
32,890,327
3,469,053,324
Schedule XIII - Operating and Other Expenses
Processing Charges
35,289,443
6,995,652
Ancillary Expenses
-
Stores & Spare Parts consumed (Refer note no.4 of Schedule XX B)
57,939,559
Power & Fuel (Refer note no.4 of Schedule XX B)
112,861,694
Repair & Maintenance (Refer note no.4 of Schedule XX B)
Building
16,628,948
19,041,472
Plant & Machinery
22,609,114
23,646,625
Others
28,492,441
67,730,503
26,633,304
Rent (Refer note no.4 of Schedule XX B)
53,624,943
Royalty
14,742,764
Directors’ Sitting Fees
345,000
40,222,731
Postage & Communication Expenses
47,716,557
Insurance
42,835,287
Travelling & Conveyance expenses (Refer note no.4 of Schedule XX B)
116,933,775
Books & Periodicals
2,240,467
Legal & Professional charges (Refer note no.4 of Schedule XX B)
113,140,386
17,155,503
Auditors’ Remuneration: (Refer note no.5 of Schedule XX B)
Statutory Audit Fee
4,093,231
3,972,119
Limited Review Fees
1,685,400
1,348,320
Others
136,332
376,394
Out of pocket expenses
251,124
6,166,087
78,074
Rates & Taxes (Refer note no.4 of Schedule XX B)
15,615,884
Donation
3,420,245
Subscription
13,700,941
31,477,974
Miscellaneous expenses (Refer note no.4 of Schedule XX B)
33,473,390
Bad Debts & Advances written off
115,891
Provision for doubtful debts & doubtful advances
116,531,425
Wealth Tax
1,393,909
Foreign Exchange Fluctuation Loss (Net of Gain Rs.214,791,328 (Previous year Rs. Nil))
571,574,318
Provision for Loss on Open Derivative Contracts 1,702,604,000
Provision for Permanent Diminution in the value of
Investments (Refer note no.12(b) of Schedule XX B)
168,068,998
3,393,917,326
108
5,843,974
11,135,528
7,473,173
46,559,069
100,327,742
69,321,401
50,223,655
4,385,550
350,000
31,487,310
39,073,273
44,074,361
114,284,121
3,448,613
75,067,398
14,853,710
5,774,907
11,260,858
6,669,274
12,226,353
29,976,294
28,592,166
27,044,708
832,746
40,500,000
780,786,184
For the year ended
31st March, 2009
Amount in Rs.
For the year ended
31st March, 2008
Schedule XIV - (Increase)/Decrease In Stocks
Closing Stock
Finished Goods
1,020,726,983
713,360,132
Work in Progress
202,833,537 1,223,560,520
57,577,914
Less: Opening Stock
Finished Goods
713,360,132
716,281,654
Work in Progress
57,577,914
770,938,046
50,067,266
(452,622,474)
770,938,046
766,348,920
(4,589,126)
Schedule XV - Personnel Expenses
Salary, Wages and Bonus
Contribution to Provident and other Funds
Workmen Staff Welfare Expenses
Gratuity
874,951,893
27,589,020
42,098,929
12,138,642
956,778,484
884,576,690
23,749,623
38,990,698
33,097,213
980,414,224
242,016,163
62,306,063
67,411,807
86,496,459
458,230,492
263,157,227
93,088,068
63,494,250
63,047,875
482,787,420
Raw Material & Packing Material Consumed
19,621,119
Stores & Spare Parts Consumed
134,104,256
Salary, Wages & Bonus
182,045,564
Contribution to Provident & other Funds
4,096,340
9,504,657
Gratuity
1,062,491
14,959,224
Rent
6,401,077
2,212,425
Postage & Communication
3,151,204
Travelling Expenses
15,897,191
Books & Periodicals
6,317,043
Legal & Professional Expenses
12,052,167
2,424,344
Donation
30,251
- Buildings
5,726,552
2,386,093
- Plant & Machinery
14,628,824
17,360,639
- Others
3,728,604
24,083,980
1,740,037
Rates, Fees & Taxes
622,995
Subscription
9,467,437
Electricity & Water Charges
33,714,494
Meeting & Conferences
2,460,794
765,564
Bank Charges
-
Depreciation
169,025,407
Sundry Expenses
15,924,021
669,944,045
32,890,327
91,423,646
155,895,586
3,607,381
7,046,234
3,287,690
15,803,303
7,569,470
2,591,736
2,794,844
12,638,102
3,966,683
9,158,686
2,044,023
1,880,651
Schedule XVI - Selling & Distribution Expenses
Advertising & Sales Promotion
Meetings & Conferences
Freight & Cartage
Commission on Sales (Other than Sole Selling Agents)
Schedule XVII - Research & Development Expenses
109
21,486,769
335,366
4,980,114
22,390,252
4,191,618
815,807
65,407
131,348,176
3,644,252
541,856,123
For the year ended
31st March, 2009
Amount in Rs.
For the year ended
31st March, 2008
Schedule XVIII - Financial Expenses
Interest on:
a) Fixed Loans
206,260,720
88,760,734
b) Others (Including interest on working capital loans)
115,282,862
321,543,582
27,694,390
Bank Charges
26,638,230
348,181,812
116,455,124
34,222,565
150,677,689
Schedule XIX - Earning Per Share
Calculation of Profit for Basic EPS:
Net Profit/(Loss) before Tax
Less: Adjustment for Tax Expense
Less: Dividend on Redeemable Preference Shares
Less: Dividend Distribution Tax on Redeemable Preference Shares
Net Profit/(Loss) for calculation of Basic EPS
Weighted average number of equity shares in calculating basic EPS
Calculation of Profit for Diluted EPS
Net Profit/(Loss) for calculation of basic EPS
Adjusted Net Profit/(Loss) for calculating Diluted EPS
No. of Weighted Equity Shares resulting from conversion
of Foreign Currency Convertible Bonds
- ‘US$ 50 Million Zero Coupon Convertible Bonds due 2011’
(outstanding US$36.8 million) at conversion price
Rs.357.57
Add: Weighted average number of Equity Shares in
Weighted average number of Equity Shares in calculating
diluted EPS
Face/ Nominal Value Per Share
(866,663,960)
(206,739,128)
33,184
5,640
(659,963,656)
66,693,746
1,876,025,059
586,208,321
1,289,816,738
66,115,919
(659,963,656)
(659,963,656)
1,289,816,738
1,289,816,738
4,542,752
4,542,752
66,693,746
66,115,919
71,236,498
70,658,671
(9.90)
(9.90)
1.00
19.51
18.25
1.00
Schedule XX - Significant Accounting Policies and Notes on Accounts (Consolidated Financial Statements)
A. Significant Accounting Policies
1.
i)
ii)
Basis of Preparation
The Consolidated Financial Statements relate to Panacea Biotec Limited (Parent Company), its Subsidiary Companies, Joint
Ventures and Associates (hereinafter collectively referred as the “Group”).
The Consolidated Financial Statements (CFS) have been prepared to comply in all material respects with the notified
Accounting Standards by Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies
Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis except in
case of assets for which provision for impairment is made and revaluation is carried out. The accounting policies have been
consistently applied by the Company and except for the changes in accounting policies discussed more fully below, are
consistent with those used in the previous year.
Principles of Consolidation
The Consolidated Financial Statements have been prepared on the following basis: a) The financial statements of the Parent Company and its Subsidiary Companies have been combined on a line by line
basis by adding together the book values of like items of assets, liabilities, income and expenses after fully eliminating
intra group balances and intra group transactions resulting in unrealized profits or losses, if any, as per Accounting
Standard – 21, Consolidated Financial Statements.
b)
Interest in assets, liabilities, income and expenses of the Joint Ventures have been consolidated using proportionate
consolidation method. Intra group balances, transactions and unrealized profits/losses have been eliminated to the
extent of Company’s proportionate shares as per Accounting Standard – 27, Financial reporting of interests in Joint
Venture.
110
c)
In case of Associates, where the company directly or indirectly through subsidiaries holds more than 20% of equity,
investment in associate is accounted for by Equity Method in accordance with Accounting Standards 23, Accounting
for Investment in Associates.
d)
The financial statements of the Subsidiary Companies, Joint Ventures and Associates used in the consolidation are
drawn for the same period as that of the Parent Company i.e. year ended March 31, 2009. Also, the Company’s Associate
in earlier years, Lakshmi and the Manager, ceased to be an Associates w.e.f. June 30, 2008 the same has been accounted
for as an Associates till the date of cessation.
e)
Minorities’ interest in net profit/(loss) of consolidated Subsidiary Companies for the year has been identified and
adjusted against the income in order to arrive at the net income attributable to the shareholders of the Parent
Company. Minorities’ share of net assets has been identified and presented in Consolidated Balance Sheet separately.
Where accumulated losses attributable to the minorities are in excess of their equity, in the absence of the contractual
obligation on the minorities, the same is accounted for by the Parent Company.
f )
List of Subsidiaries, Joint Ventures and Associates considered for Consolidation:
S. No. Name of the Company
Nature of
Country of
relationship
Incorporation
Extent of Holding/
Voting Power (%) as on
March 31, 2009
1
Best On Health Ltd.
Subsidiary
India
2
Panacea Educational Institute Pvt. Ltd.
Indirect Subsidiary*
India
3
Radicura & Co. Ltd.
India
4
Panacea Hospitality Services Pvt. Ltd.
India
5
Sunanda Steel Company Ltd.
India
6
Umkal Medical Institute Pvt. Ltd.
Subsidiary
India
(w.e.f. June 30, 2008)
7
Panacea Biotec GmbH
Subsidiary
Germany
(w.e.f. June 11, 2008)
8
Panacea Biotec, Inc. (w.e.f. July 15, 2008)
Subsidiary
USA
9
Panacea Biotec FZE
Subsidiary
UAE
(w.e.f. March 16, 2008)
10
Rees Investments Ltd.
Subsidiary
Guernsey
(w.e.f. September 16, 2008)
11
Kelisia Holdings Ltd.
Indirect Subsidiary†
Cyprus
12
Kelisia Investment Holdings AG
Indirect Subsidiary††
Switzerland
(w.e.f. October 22, 2008)
13
Panacea Biotec (International) SA
Indirect Subsidiary†††
Switzerland
(w.e.f. February 19, 2009)
14
Chiron Panacea Vaccines Pvt. Ltd.
Joint Venture
India
15
PanEra Biotec Pvt. Ltd. (Earlier Associate
India
known as Panheber Biotec Pvt. Ltd.)
16
Lakshmi & the Manager
Associate
India
(up to June 30, 2008)
17
Lakshmi & Manager Holdings Ltd.
Associate India
(w.e.f. July 1, 2008)
18
Best General Insurances Co. Ltd
Indirect Associate**
India
100.0
100.0
100.0
100.0
100.0
75.2
*Wholly Owned Subsidiary of Best on Health Ltd.
Wholly Owned Subsidiary of Rees Investments Ltd. †††
Wholly Owned Subsidiary of Kelisia Investment Holdings AG
†
111
100.0
100.0
100.0
100.0
100.0
100.0
50.0
50.0
40.0
40.0
32.0
**Subsidiary of Lakshmi & Manager Holdings Ltd.
Wholly Owned Subsidiary of Kelisia Holdings Ltd.
††
g)
2.
100.0
Goodwill represents the difference between the Parent Company’s shares in the net worth of the Subsidiary / Joint
Venture Company and the cost of acquisition at the time of making the investment in the Subsidiary / Joint Venture
Companies. For this purpose, the Parent Company’s share of net worth of the Subsidiary/ Joint Venture Company is
determined on the basis of the latest financial statements of the Subsidiary/ Joint Venture Company prior to acquisition,
after making the necessary adjustments for material events between the date of such financial statements and the
date of respective acquisition.
h) The Consolidated Financial Statements have been prepared using uniform accounting policies to the extent possible
for like transactions and other events in similar circumstances and are presented in the same manner as the Parent
Company’s separate financial statements.
Change in Accounting Policy
For the Financial Year ended 31st March, 2008, the Company was charging off exchange differences arising on foreign currency
monetary assets and liabilities to profit and loss account. Pursuant to Companies (Accounting Standards) Amendments Rules,
2009, the Company has exercised the option of deferring the charge of exchange difference to the Profit and Loss Account, in
respect of accounting periods commencing on or after 7th December, 2006, on long-term foreign currency monetary items (i.e.
3.
4.
5.
6.
7.
8.
monetary assets or liabilities expressed in foreign currency and having a term of 12 months or more at the date of origination). As
a result, such exchange differences so far as they relate to the acquisition of a depreciable capital asset have been adjusted with
the cost of such asset and are being depreciated over the balance life of the asset, and in other cases, have been accumulated in
Foreign Currency Monetary Item Translation Difference Account and are being amortized over the balance period of such long
term asset/liability but not beyond, accounting period ending on or before 31st March 2011.
In the current year, such exchange differences, pertaining to accounting periods commencing on 1 April, 2007 and ending on
31 March, 2008 are transferred from General Reserve, to the extent they related to acquisition of depreciable capital assets are
adjusted with the cost of such assets Rs.24,810,859 (net of depreciation of Rs.1,609,882) (net of tax of Rs.12,775,656) and in
other cases, are transferred to the Foreign Currency Monetary Item Translation Difference Account Rs.61,039,657 (net of tax of
Rs.31,430,661).
Had the Company continued to use the earlier basis of accounting for exchange differences arising on long-term foreign currency
monetary items, the Loss after tax for the current period would have been higher by Rs.561,174,198 (net of tax of Rs.288,960,930),
the net block of fixed assets would have been lower by Rs.624,117,162 (net of depreciation of Rs.94,952,131) and general reserve
would have been higher by Rs.130,056,833.
Uses of Estimates
The presentation of financial statements in conformity with the Generally Accepted Accounting Principles requires estimates and
assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the
reported amount of revenues and expenses during the reporting period. Difference between the actual result and estimates are
recognized in the period in which the results are known/materialized.
Revenue Recognition
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can
be reliably measured.
Sale of Goods - Revenue is recognized when the significant risks and rewards of ownership of the goods have passed to the buyer
and is stated net of trade discounts, free quantities, returns and sales tax but includes excise duty. Excise Duty deducted from
turnover is the amount that is included in the amount of turnover (gross) and not the entire amount of liability arise during the
year.
Research & Development - Income from Research & Development Services is accounted for as per the stage of completion.
Contract Manufacturing- Revenue is recognized on an accrual basis in accordance with the term of the relevant agreement.
Interest - Revenue is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.
Dividends - Revenue is recognized when the shareholders’ right to receive payment is established by the Balance sheet date.
Dividend from subsidiaries is recognized even if same are declared after the balance sheet date but pertains to the period on or
before the date of balance sheet as per the requirements of schedule VI of the Companies Act, 1956.
Royalties - Revenue is recognized on an accrual basis in accordance with the term of the relevant agreement.
Export Benefits - Export entitlements under Duty Entitlement Pass Book Schemes and Advance Licenses are recognized in the
Profit & Loss Account when the right to receive credit as per terms of scheme is established in respect of export made and where
there is no significant uncertainty regarding the ultimate collection of the relevant export proceeds.
Fixed Assets
Fixed assets are stated at cost less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price and
any attributable cost of bringing the asset to its working condition for its intended use. Borrowing costs relating to acquisition of
fixed assets which takes substantial period of time to get ready for its intended use are also included to the extent they relate to
the period till such assets are ready to be put to use.
In respect of accounting periods commencing on or after 7th December, 2006, exchange differences arising on reporting of the
or reported in the previous financial statements are added to or deducted from the cost of the asset and are depreciated over the
balance life of the asset, if these monetary items pertain to the acquisition of a depreciable fixed asset.
Impairment of Fixed Assets
The carrying amounts of assets are reviewed at each Balance Sheet date as to whether if there is any indication of impairment
based on internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its
recoverable amount. The recoverable amount is the greater of the assets net selling price and value in use. In assessing value in
use, the estimated future cash flows are discounted to their present value at the weighted average cost of capital.
After impairment, depreciation is provided on the revised carrying amount of the assets over its remaining useful life.
Expenditure during Construction Period
Expenditure directly relating to construction activity is capitalized. Indirect expenditure incurred during construction period is
capitalized as part of the indirect construction cost to the extent to which the expenditure is indirectly related to construction or
is incidental thereto. Income earned during construction period is deducted from the total of the indirect expenditure.
Intangibles
Patents and Trademarks - Costs relating to patents and trademarks, which are acquired, are capitalized.
Research and Development Costs - Research costs are expensed as incurred. Development expenditure incurred on an individual
project is carried forward when its future recoverability can reasonably be regarded as assured.
Product Development – Product Development is capitalized on successful completion of development activities and commercial
112
9.
launch of developed products.
Technical Know how - Technical Know how is being capitalized on successful transfer of technology when its future recoverability
can reasonably be regarded as assured.
Software and Website - Software is stated at cost of acquisition and includes all attributable costs of bringing the software to its
working condition for its intended use.
Goodwill – Goodwill on consolidation is amortized over a period of 5 years.
The carrying value of intangible assets is reviewed for impairment annually when the asset is not yet in use, and otherwise when
events or changes in circumstances indicate that the carrying value may not be recoverable.
Depreciation/ Amortization
a) Depreciation on fixed assets is provided on written down value method as per the rates based on the estimated useful life
or as per rates prescribed in Schedule XIV to the Companies Act, 1956 whichever is higher. Depreciation is provided on the
following rates:
Tangibles Assets
Building – Factory
Building – Office Premises
Plant & Machinery
Vehicles
Office Equipments
Computer Equipments
WDV %
10.00
5.00
13.91
18.10
25.89
13.91
40.00
b)
10.
11.
12.
13.
14.
113
Depreciation on intangibles is provided on the basis of the estimated useful lives as follows:Software
- Depreciated on Straight Line basis over a period of 5 years.
Websites
Patents, Trade Mark & Designs - Depreciated on Straight Line basis over a period of 7 years.
Product Development
Technical Know-how
- Amortized on straight line basis over a period of 5 years.
c) Leasehold Land is depreciated over the period of lease or useful life, whichever is shorter.
d) Leasehold Improvements are amortized over the initial period of lease or useful life, whichever is shorter.
Borrowing Costs
Borrowing costs attributable to the acquisition, construction or production of a qualifying asset are capitalized as part of the cost
of that asset. Borrowing costs, which are not relatable to qualifying assets, are recognized as an expense in the period in which
they are incurred.
Leases
Where the Company is the Lessee
Leases, where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term, are classified as
operating leases. Operating lease payments are recognized as an expense in the Profit and Loss account on a straight-line basis
over the lease term.
Where the Company is the Lessor
Assets subject to operating leases are included in fixed assets. Lease income is recognized in the Profit and Loss Account on a
straight-line basis over the lease term. Costs, including depreciation are recognized as an expense in the Profit and Loss Account.
Initial direct costs such as legal costs, brokerage costs, etc. are recognized immediately in the Profit and Loss Account.
Expenditure incurred prior to April 1, 2003 towards procuring license for new products is written off over the period of agreement
or ten years whichever is shorter. Expenditure of the similar nature incurred during the year is charged off to revenue.
Investments
Investments that are readily realizable and intended to be held for not more than a year are classified as current investments.
All other investments are classified as long-term investments. Current investments are carried at lower of cost and fair value
determined on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution, if
any, in value is made to recognize a decline other than temporary in the value of the investments.
Inventories
Finished Goods, Work in Progress, Goods held for Resale, Raw Materials, Packing Materials and Stores & Spares are stated at lower
of cost and net realizable value. However, materials and other items held for use in the production of inventories are not written
down below cost if the finished goods in which they will be incorporated are expected to be sold at or above cost.
‘Cost’ of Finished Goods, Work in progress, Raw Materials, Packing Materials and Stores & Spares is arrived at by using ‘Moving
Average Price’ method.
Cost of Work in Progress and Finished Goods is determined by considering direct material cost and appropriate portion of
manufacturing overheads based on normal operating capacity. Cost of traded goods is arrived at by using ‘Moving Average Price’
method and for one of the Joint Ventures as first in first out basis. Cost of finished goods includes Excise Duty.
Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and to
make the sale.
15. Retirement and Other Employees Benefits
a) Retirement benefits in the form of Provident Fund and Pension Schemes are defined contribution schemes and the
contributions are charged to the Profit and Loss Account of the year when the contributions to the respective funds are due.
There are no other obligations other than the contribution payable to the respective funds.
b) The contribution to Gratuity Fund, which is a defined benefit plan, is expensed on the basis of funding claims of the fund
manager, Life Insurance Corporation of India. At the end of the accounting year, actuarial valuation is done as per projected
unit credit method by an independent Actuary and any shortfall in the fund balance is further provided for.
c) Short term compensated absences are provided for based on estimates. Long term compensated absences are provided for
based on actuarial valuation done as per projected unit credit method.
d) Leave encashment payable/ adjustable during the year is provided on the basis of last salary drawn by employees.
e) Actuarial gains/losses are adjusted in Profit & Loss Account and are not deferred.
16. Foreign Currency Transaction
Initial Recognition
Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount, the exchange
rate between the reporting currency and the foreign currency at the date of the transaction.
Conversion
Foreign currency monetary items are reported using the closing rate. Non-monetary items which are carried in terms of historical
cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction and non-monetary
items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange
rates that existed when the values were determined.
Exchange Differences
Exchange differences arising on the settlement of monetary items or on reporting such monetary items at rates different from
those at which they were initially recorded during the year, or reported in previous financial statements, are recognized as income
or as expenses in the year in which they arise except those monetary items as mentioned below.
Exchange differences, in respect of accounting periods commencing on or after 7th December, 2006, arising on reporting of
or reported in previous financial statements, in so far as they relate to the acquisition of a depreciable capital asset, are added to
or deducted from the cost of the asset and are depreciated over the balance life of the asset, and in other cases, are accumulated
in a “Foreign Currency Monetary Item Translation Difference Account” in the financial statements and amortized over the balance
period of such long-term asset/liability but not beyond accounting period ending on or before 31st March, 2011.
Exchange differences arising on a monetary item that, in substance, form part of company’s net investment in a non-integral
foreign operation is accumulated in a foreign currency translation reserve in the financial statements until the disposal of the net
investment, at which time they are recognized as income or as expenses.
Forward Exchange Contracts not intended for trading or speculation purposes
The premium or discount arising at the inception of forward exchange contracts is amortized as an expense or income over the
life of the contract. Exchange differences on such contracts are recognized in the statement of Profit and Loss Account in the
year in which the exchange rates change. Any profit or loss arising on cancellation or renewal of forward exchange contract is
recognized as income or as expense for the year.
17. Income Taxes
Tax expense comprises of current, deferred and fringe benefit tax. Current Income Tax and Fringe Benefit Tax is measured at
the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961, enacted in India. Deferred
Income Taxes reflect the impact of current year timing differences between taxable income and accounting income for the year
and reversal of timing differences of earlier years.
Deferred Income Tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet
date. Deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income
will be available against which such deferred tax assets can be realized. If the Company has unabsorbed depreciation or carry
forward tax losses, deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that such
deferred tax assets can be realized against future taxable profits.
At each Balance Sheet date the Company re-assesses unrecognized deferred tax assets. It recognizes unrecognized deferred tax
assets to the extent that it has become reasonably certain or virtually certain, as the case may be, that sufficient future taxable
income will be available against which such deferred tax assets can be realized.
The carrying amount of deferred tax assets are reviewed at each balance sheet date. The Company writes down the carrying
amount of a deferred tax assets to the extent that it is no longer reasonably certain or virtually certain, as the case may be,
that sufficient future taxable income will be available against which deferred tax assets can be realized. Any such write-down is
reversed to the extent that it becomes reasonably certain or virtually certain, as the case may be, that sufficient future taxable
income will be available.
18. Earnings Per Share
Basic Earnings per Share are calculated by dividing the net profit or loss for the period attributable to equity shareholders (after
deducting preference dividends and attributable taxes) by the weighted average number of equity shares outstanding during
the period. Partly paid equity shares, if any, are treated as a fraction of an equity share to the extent that they were entitled
to participate in dividends relative to a fully paid equity share during the reporting period. The weighted average number of
114
19.
20. 21.
22.
23.
equity shares outstanding during the period is adjusted for events of bonus issue, bonus element in a rights issue to existing
shareholders, share split and reverse share split (consolidation of shares), if any.
For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders
and the weighted average number of Shares outstanding during the period are adjusted for the effects of all dilutive potential
equity shares.
Provisions
A provision is recognized when the Company has a present obligation as a result of past event and it is probable that an outflow
of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not
discounted to its present value and are determined based on management’s best estimate required to settle the obligation at the
balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.
Segment Reporting Policies
(a) Identification of Segments:
Primary Segment
Business Segment: The Company’s operating businesses are organized and managed separately according to the nature of
products, with each segment representing a strategic business unit that offers different products. The identified segments
are Vaccines, Formulations, Research & Development and Healthcare Activities.
Secondary Segment
Geographical Segment: The analysis of geographical segment is based on the geographical location of the customers.
The geographical segments considered for disclosure are as follows:
•
Revenue from domestic market includes sales to customers located within India.
•
Revenue from overseas market includes sales to customers located outside India.
(b) Allocation of Common Costs: Common allocable costs are allocated to each segment on a rational basis based on nature of
each such common cost.
(c) Unallocated Items: Corporate income and expenses are considered as a part of unallocable income & expense, which are not
identifiable to any business segment.
Derivative Instruments
As per announcement of Institute of Chartered Accountants of India, accounting for derivative contracts, other than those
covered under AS-11, are marked to market on a portfolio basis and the net loss after considering the offsetting effect on the
underlying hedge item is charged to the Profit and Loss Account. Net gains are ignored.
Cash & Cash Equivalent
Cash and cash equivalents in the balance sheet comprise cash at bank and in hand and short-term investments with an original
maturity of three months or less.
Preliminary Expenses
Costs incurred are amortized equally over a period of 5 years after the commencement of commercial operations.
B. Notes To Accounts (All amounts are in Rs. unless otherwise stated)
1.
Contingent Liabilities (to the extent not provided for)
Particulars
Disputed demands/ show-cause notices under:a) Sales Tax Cases
b) Income Tax Cases
c) Customs Duty Cases
d) Central Excise Duty Cases
e) Service Tax
Total
Labour cases (in view of large number of cases, it is impracticable to
disclose each of them)
Other claims against the Company not acknowledged as debts
Premium on Redemption of ‘US$ 50 Million Zero Coupon
Convertible Bonds due 2011’ (Refer note 3(ii) below)
Current Year
Previous Year
-
110,557 3,999,923 6,596,620
29,789,842
40,496,942 2,803,586 13,809
2,863,251
3,999,923
6,596,620
13,473,603
4,143,107
-
470,992,269 64,000
243,706,599
Notes:
a) Sales Tax liability of Rs.13,809 was on account of non-receipt of C forms from customers for inter-state sales. No provision was required for the
same as the management was hopeful of receiving the forms before the due date of filing of Sales Tax Returns.
b) In respect of Income Tax, in Assessment Year 2005-06 the department disallowed ‘Club Expenses’ of Rs.255,800 on the ground that the these
expenses were incurred in the personal names and not in the name of the company, hence not related to the business of the company in the
order under section 143(3) of the Act. The company preferred appeal before the CIT (Appeals). The CIT (Appeals) restricted the disallowance
to Rs.50,000 from Rs.255,800. In Assessment Year 2006-07 the department disallowed depreciation on LAN of Rs.60,557 on the ground that
depreciation on the same is allowable @25% and not @60% in the order under section 143(3) of the Act. No provision is considered necessary
in this regard since the Company believes it has a good case based on nature of the case and legal advice obtained by it.
c) In respect of Customs Duty demand of Rs.3,999,923 towards Customs Duty on certain items imported as exempted by the Company, the
Company has deposited the entire amount under protest. The matter is pending before the Hon’ble Supreme Court of India. No provision is
115
d)
e)
2.
3.
considered necessary in this regard since the Company believes it has a good case based on nature of the case and legal advice obtained by
it.
In respect of Central Excise Duty demand of Rs.6,596,620 towards Excise Duty on common inputs used in manufacture of exempted and
taxable products, the Company has deposited the entire amount under protest. The matter is pending before Central Excise and Customs
Tribunal. No provision is considered necessary in this regard since the Company believes it has a good case based on nature of the case and
legal advice obtained by it.
In respect of service tax demand of Rs.29,789,842 relating to foreign services rendered & delivered outside India & others services, which
were brought in service tax net w.e.f. 18.04.06 and against which numerous decisions/ judgments have been pronounced by the competent
courts/judicial authorities, the Company has sent suitable reply to the concerned authority. No provision is considered necessary in this
regard since the Company believes it has a good case based on nature of the demand and legal advice obtained by it.
Estimated amount of contracts remaining to be executed on capital account, net of advances and not provided in the books are
as follows:S. No.
Particulars
Current Year
Previous Year
1.
2.
Tangibles Assets
Intangible Assets
Total
529,633,712 21,946,833
551,580,545
306,726,108
90,701,180
397,427,288
i)
Conversion price of ‘US$ 50 Million Zero Coupon Convertible Bonds due 2011’ (FCCBs) has already been fixed at Rs.357.57
per Share. This Rate is used to determine dilutive Equity Shares against outstanding Bonds.
ii)
‘US$ 50 Million Zero Coupon Convertible Bonds due 2011’ amounting to US$ 36,800,000 are pending for redemption as on
31st March 2009. Unless these Bonds have been previously converted, redeemed, repurchased and cancelled, the Company
will redeem these Bonds at a price equal to 142.80% of the outstanding principal amount on the maturity date i.e. February
14, 2011 (including premium amounting to Rs.798,860,288). Since the redemption of bonds is contingent upon its nonconversion into Equity Shares and the probability of redemption cannot presently be ascertained, the Company has not
provided for the proportionate premium on redemption for the period upto 31st March, 2009 amounting to Rs.470,992,269
(Previous Year 243,706,599). Such premium has been disclosed as contingent liability. These Bonds are considered a
monetary liability and are redeemable only if there is no conversion before maturity date.
iii) The Company has fully utilized the issue proceeds of ‘US$ 50 Million Zero Coupon Convertible Bonds due 2011’ in earlier
years.
4.
Details of pre-operative expenses (included in Capital Work in Progress) relating to Fixed Assets are as follows:
Particulars
Legal & Professional
Store & Spares consumed
Power and Fuel
Rates & Taxes
Repair & Maintenance:
Plant and Machinery
Others
Salary and Wages
Office Expenses
Travel and Conveyance
Rent
Miscellaneous Expenses
Total
As at
April 1, 2008
Additions
during the year
Capitalised
during the year
As at
March 31, 2009
53,548,946
(2,941,783)
22,419,030
(2,325,569)
31,254,050
(4,219,189)
9,860,525
(285,008)
11,434,122
(51,926,227)
50,376
(22,126,744)
357,323
(27,922,199)
4,872
(9,575,517)
3,862,283
(13,190,164)
22,469,406
(2,033,283)
31,529,249
(887,338)
9,575,517
(-)
61,120,785
(53,548,946)
(22,419,030)
82,124
(31,254,050)
289,880
(9,860,525)
4,452,852
(120,255)
6,222,930
(157,267)
14,399,373
(2,335,791)
2,733,205
(-)
3,855,848
(1,003,717)
1,038,300
(-)
4,595,999
(347,310)
154,381,058
(13,735,889)
-
(43,627,41)
7,73,882
(60,74,541)
4,580,192
(12,114,403)
73,934
(2,733,205)
1,857,383
(2,852,131)
3,081,945
(1,038,300)
7,215,152
(4,463,177)
29,429,181
(145,189,185)
4,452,852
(30,144)
6,545,065
(8,878)
13,191,507
(50,821)
2,807,139
(-)
3,731,531
(-)
25,799
(-)
8,802,924
(214,488)
106,993,272
(4,544,016)
(4,452,852)
451,747
(6,222,930)
5,788,058
14,399,373
(2,733,205)
1,981,700
(3,855,848)
4,094,446
(1,038,300)
3,008,227
(4,595,999)
76,816,967
(154,381,058)
Note: Figures in brackets represent previous year figures (2007-08)
116
5. Auditor’s Remuneration:
Particulars
Year ended March 31, 2009
Year ended March 31, 2008
Parent
Subsidiaries
Company
Joint
Ventures
Parent
Subsidiaries
Company
Joint
Venture
- Statutory Audit
3,309,000
382,919
- Quarterly Limited Reviews
1,685,400
-
4,68,762
3,400,060
57,304
514,755
-
1,348,320
-
134,832
1,500
-
-
113,217
-
248,177
Statutory Auditors
- Certificates
- Other Advisory
- Out of Pocket Expenses
-
15,000
-
-
15,000
161,721
-
6,953
69,317
-
8,757
5,290,953
399,419
475,715
4,930,914
72,304
771,689
-
93,038
140,450
-
84,270
-
33,708
-
-
Tax Auditor*
140,450
Cost Auditor*
44,944
* included in the Legal & Professional charges given in Schedule XIII
6.
Disclosure of Micro & Small Enterprises
Details of dues to Micro, Small and Medium Enterprises as per Micro, Small and Medium Enterprise Development Act, 2006
(“MSMED Act”).
Current Year
117
Previous Year
Principal
Interest
Principal
Interest
Principal amount and interest due thereon remaining unpaid to any supplier as at
31st March 2009.
1,274,843
Nil
1,177,455
Nil
Interest paid by the Company in terms of section 16 of the MSMED Act along with
the amounts of the payment made to the
supplier beyond the appointed day during
accounting year
3,552,413
68,868
4,703,195
78,680
Interest due and payable for the period of delay in making payment (which have been
paid but beyond the appointed day during
the year) but without adding the interest
specified under MSMED Act
Nil
Nil
Nil
Nil
Interest accrued and remaining unpaid at the end of the year
Nil
Nil
Nil
Nil
Further interest remaining due and payable in succeeding years, until such date when the
interest dues as above are actually paid to the
small enterprises for the purpose of
disallowance as a deductible expenditure
under section 23 of the MSMED Act
Nil
Nil
Nil
Nil
7.
Deferred Tax Liabilities (Net): The break-up of deferred tax liability is as follows:
Current Year
Previous Year
Deferred Tax Liabilities:
Differences in depreciation and amortization in block of fixed assets as per tax books
and financial books
Capital expenditure on Research & Development Forex Loss (revenue) deferred as per notification on AS-11 (Revised) Gross Deferred Tax Liabilities
Deferred Tax Assets:
Effect of expenditure debited to Profit and Loss Account in the current year but allowed for tax purposes in following years
Loss as per Income Tax Act carried forward
Unabsorbed Depreciation as per Income Tax Act carried forward Gross Deferred Tax Assets Net Deferred Tax Liability
501,434,945
375,059,972
1,241,287
267,365,738
50,254,492
820,296,462
1,786,309
262,159,287
639,005,568
49,139,072
43,501,706
364,509,363
71,861,483
485,509,918
334,786,544
43,501,706
595,503,862
Note: The Group has recorded a loss before tax of Rs.877,492,204 in year ended March 2009 which is mainly on account of foreign currency loss of
Rs.1,702,604,000 on open derivative contracts. The group is otherwise earning good operating margin and based on orders on hand, it is virtually
certain that it will earn sufficient margins to generate income to reverse book losses and will generate taxable profits to set-off the unabsorbed
depreciation and carry-forward losses and other timing differences resulting into deferred tax assets. Hence, the group has recognised deferred
tax asset as at March 31, 2009 on carry-forward losses component also.
8.
Related Party Disclosures
A. Names of Related Parties
(a) Key Management Personnel:
Mr. Ravinder Jain
Dr. Rajesh Jain
Mr. Sandeep Jain
Mr. Sumit Jain
-
-
-
-
-
Chairman and Whole-time Director
Managing Director
Whole-time Director
(b) List of Persons having controlling interest together with their relatives*
Key Management
Personnel
Father
Mother
Wife
Son
Daughter
Soshil Kumar Jain
-
-
Nirmala Jain
-
-
Ravinder Jain, Rajesh Jain,
Sandeep Jain
-
Ravinder Jain
Soshil Kumar Jain
Nirmala Jain
Sunanda Jain
Rajesh Jain, -
Sandeep Jain
Sumit Jain,
Nipun Jain
Radhika Jain
Rajesh Jain
Soshil Kumar Jain
Nirmala Jain
Meena Jain
Ravinder Jain, -
Sandeep Jain
Ankesh Jain, Harshet Jain
-
Sandeep Jain
Soshil Kumar Jain
Nirmala Jain
Pamilla Jain
Ravinder Jain, -
-
Rajesh Jain
Priyanka Jain
Sumit Jain
Nipun Jain
-
* Relatives/associates holding Equity Shares in the Company have been disclosed
Ravinder Jain
Sunanda Jain
-
Brother
Sister
Radhika Jain
-
* Relatives holding Equity shares in the Company have been disclosed
(c) Relatives of Key Management personal having transactions with the Company
Mr. Ashwani Jain, Son-in-law of Mr. Soshil Kumar Jain
Mr. Shagun Jain, Son-in-law of Mr. Ravinder Jain
Mrs. Radhika Jain, Daughter of Mr. Ravinder Jain
Mrs. Shilpy Jain, Wife of Mr. Sumit Jain
(d) Enterprises over which person(s) having controlling interest in Company / Key management personnel(s) along with
their relatives are able to exercise significant influence;
(i) Neophar Alipro Limited, (ii) All India S. L. Jain Charitable Foundation, (iii) First Lucre Partnership Co.* , (iv) Second Lucre
Partnership Co.* , (v) Radhika Associates, (vi) Sumit Nipun & Co., (vii) Rattan Sons, (viii) Tahir & Co., (ix) Best On Health
Foods Ltd. , (x) Soshil Kumar Jain (HUF)*, (xi) Ravinder Jain (HUF)*, (xii) Rajesh Jain (HUF)*, (xiii) Sandeep Jain (HUF)*
* These enterprises are also holding Shares in the Company.
118
B.
Details of Transactions with the Related Parties
Particulars
A. During the year
Purchase of
raw materials
Sale
Processing Charges paid
Recovery of dues on
Account of Expenses
Rent paid
Rent received
Investments made
Sale of Investment
Remuneration
Loan/Fixed Deposits Received
Loan/Fixed Deposits Repaid
Interest Paid on Deposits/Loans
Dividend Paid- Equity Shares
Purchase of Shares
Donation made
B. Year end balances
Investments
Outstanding receivable
Provision for bad and
doubtful advances
Outstanding Fixed
Deposits/Loan
Joint Ventures
PanEra Biotec Chiron Panacea
Pvt. Ltd. (Upto
Vaccines
20.11.2007)
Pvt. Ltd.
Associates
Key
Relatives and
PanEra Biotec
Lakshmi & Lakshmi & Management Associates of Key
Pvt. Ltd. (w.e.f. The Manager
Manager
Personal
Management
21.11.2007) Holdings Ltd.
Personal
Total
-
(7,797,679)
-
(-)
-
(-)
-
(16,777,765)
-
(3,539,340)
-
(28,000)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
121,638,985
(109,172,953)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
63,092,690
(12,824,361)
20,568,527
(-)
12,578,568
(-)
33,481,411
(9,644,863)
-
(-)
8,886,016
(541,473)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(24,000,000)
24,754,276
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
-
(-)
(-)
-
-
(-)
(-)
-
-
(-)
(-)
-
-
(-)
(-)
-
-
(-)
(-)
-
-
(-)
(-)
24,754,276
-
(-)
(-)
-
-
(-)
(-)
-
63,035,463
(-) (202,154,417)
-
-
(-)
(-)
-
-
(-)
(-)
-
-
(-)
(-)
-
19,503,700
(-) (19,503,700)
-
-
(-)
(100,000)
-
-
(-)
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
4,843,885
(4,842,137)
300,000,000
(612,500,000)
432,500,000
(348,390,000)
35,893,714
(25,935,713)
24,137,900
(24,137,900)
-
(590,000)
300,000
(500,000)
63,092,690
(20,622,040)
142,207,512
(109,172,953)
12,578,568
(-)
33,481,411
(26,422,628)
(3,539,340)
8,886,016
(569,473)
24,754,276
(24,000,000)
24,754,276
(-)
67,879,348
(206,996,554)
300,000,000
(612,500,000)
432,500,000
(348,390,000)
35,893,714
(25,935,713)
43,641,600
(43,641,600)
(690,000)
300,000
(500,000)
-
(-)
-
(-)
-
(-)
-
(-)
11,479,550
(11,479,550)
39,077,216
(27,558,846)
-
(-)
-
(-)
2,098,835
(2,098,835)
97,543,624
(67,766,327)
67,766,327
(67,766,327)
-
(-)
-
(24,000,000)
-
(-)
-
(-)
-
(-)
24,754,276
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
-
(-)
300,000,000
(432,500,000)
38,332,661
(37,578,385)
136,620,840
(95,325,173)
67,766,327
(67,766,327)
300,000,000
(432,500,000)
-
(-)
-
(-)
-
(-)
-
(-)
Notes: 1. Figures in Brackets represent previous year figures. 2. In respect of personal guarantee given by Promoter-Directors refer Note no 2 of Schedule III. 3. In respect of Joint Venture & Associates figures
represents other than Panacea Biotec Ltd.’s share. 4. Material related party transactions (More than 10% of aggregate) with individual parties are as follows:
Particulars
During the year
Unsecured Loans/ Fixed
Deposits received/(repaid)
Current Year
Previous Year
Interest
Current Year
Previous Year
Managerial Remuneration
Current Year
Previous Year
Equity Dividend
Current Year
Previous Year
Key Management personnel
-
-
-
-
15,155,738
48,153,429
5,000,000
5,000,000
Mr. Ravinder Jain
-
-
-
-
19,321,956
59,771,725
4,646,200
4,646,200
Dr. Rajesh Jain
-
-
-
-
12,648,046
45,645,737
4,706,900
4,706,900
Mr. Sandeep Jain
-
-
-
-
12,648,046
45,645,737
4,792,100
4,792,100
Enterprises over which Person(s) having control or significant influence over the Company / Key management personnel(s), along with their relatives, are able to exercise significant influence
300,000,000
612,500,000
35,893,714
25,405,853
-
-
-
(432,500,000) (330,000,000)
-
-
-
-
-
All India S.L. Jain Charitable Foundation
-
-
415,993
-
-
-
Year end Balances
300,000,000
432,500,000
-
-
-
-
-
-
119
9.
Derivative Instruments and Hedged/Unhedged Foreign Currency Exposure
i)
Forward contract outstanding as at Balance Sheet date
Sell - Nil
Buy - Nil
ii)
Particulars of Hedged Export Receivables at applicable exchange rates in respect of Options Contracts outstanding as at
Balance Sheet date
Currency Exchange Amount in
rates
Foreign Currency
Amount in
Indian Rupees
Amount in
Foreign Currency
Amount in
Indian Rupees
Purpose
Current Year
Current Year
Previous Year
Previous Year
USD
41.00
-
-
28,000,000
1,148,000,000
To
USD
40.55
-
-
30,000,000
1,216,500,000
hedge
USD
40.00
58,000,000
2,320,000,000
84,000,000
3,360,000,000
Export
USD
39.00
48,000,000
1,872,000,000
48,000,000
1,872,000,000
Receivables
USD
39.60
36,000,000
1,425,600,000
36,000,000
1,425,600,000
142,000,000
5,617,600,000
226,000,000
9,022,100,000
Accordingly, exchange fluctuation loss on marking them to market as of year end amounting to Rs.1,702,604,000 (Previous
Year Rs.40,500,000) has been accounted for and included in “Provision for Loss on Open Derivative Contracts” under
Schedule XIII - Operating and Other Expenses
iii) Particulars of Hedged Foreign Currency Exposure as at the Balance Sheet date
Particulars
Amount as at
Currency
31st March’09
Export Debtors
15,038,066
Closing
Exchange
Rate*
Amount as at
31st Mar’09
(INR)
50.71
762,580,345
USD
Closing
Rate*
28,387,626
USD
Amount as at
31st Mar’08
(INR)
40.12 1,138,769,629
iv) Particulars of Unhedged Foreign Currency Exposure as at the Balance Sheet date
Particulars
Amount as at
Currency
31st March’09
Import Creditors
Closing
Exchange
Rate*
Amount as at
31st Mar’09
(INR)
Closing
Rate*
Amount as at
31st Mar’08
(INR)
6,035,469
USD
50.72
306,119,006
5,332,130
USD
40.11
-
-
-
-
203850
USD
40.34
213,845,059
8,223,309
12,841,668
EURO
67.54
867,327,519
887,098
Euro
63.35
56,197,580
33,538
CHF
44.56
1,494,481
35,692
CHF
39.89
1,423,840
12,289
GBP
72.60
892,159
17,355
GBP
79.52
1,380,106
1,217,220
JPY/100
51.55
627,521
2,576,200
JPY/100
39.99
1,030,086
16,820
SEK
6.13
103,140
16,820
SEK
6.74
113,399
1,010
CAD
40.47
40,856
-
-
-
-
2,990,037
EURO
67.50
201,827,823
2,589,747
Euro
63.38
164,142,548
65,097,252
USD
50.72
3,301,732,614
45,221,166
USD
40.11 1,813,595,469
9,652,566
10,5761
USD
EURO
50.71
67.5
489,481,613
7,138,856
874,867
1,404,665
USD
Euro
40.12
63.38
36,800,000
USD
50.72
1,866,496,000
36,800,000
USD
40.11 1,475,864,000
Export Debtors
Foreign Currency Loans
Balance with Banks
FCCBs
*The amount converted in INR is being round off to two decimal places.
120
35,095,289
89,030,070
10. Segmental Information
A. Information about Primary Segments
Particulars
Vaccines 2008-09
Formulations
2007-08
2008-09
Healthcare
Total
2007-08
2008-09
2007-08
2008-09
2007-08
5,617,717,120 6,432,222,552 2,262,302,398 1,976,017,495
2008-09
2007-08
Revenue
Segment Revenue
1,699,562
5,195,312
-
-
32,517,814
-
-
-
-
Total
5,623,669,316 6,472,440,968 2,287,252,624 2,008,535,309
1,699,562
5,195,312
-
-
7,912,621,502 8,486,171,589
Segment Results
2,689,749,974 2,874,003,726
(668,244,483) (587,118,431)
Other Income
5,952,196
40,218,416
24,950,226
466,882,428
220,745,751
7,881,719,080 8,413,435,359
30,902,422
72,736,230
(5,658,514)
-
2,482,729,405 2,507,631,046
Unallocated Corporate
Expenses
-
3,308,904,285 (744,741,593)
Operating Profit
/(Loss)
-
(826,174,880) 1,762,889,453
Interest & Finance
Charges
-
321,543,582 (152,290,601)
Other Income
-
Income Taxes
-
(206,739,127) (587,041,067)
Net Profit/(Loss)
-
(659,924,832) 1,289,816,737
2,143,579,827 1,961,794,070 2,305,499,096 1,967,257,711
14,449,170,380 10,517,987,517
Assets
2,680,016,136 2,483,391,743
281,054,503
266,258,952
Other Information
Segment Assets
Total Assets
8,242,804,702 4,673,939,748 1,757,286,755 1,914,995,988
8,242,804,702 4,673,939,748 1,757,286,755 1,914,995,988
Segmental Liabilities
852,101,141
469,524,505
391,402,477
257,279,313
2,143,579,827 1,961,794,070 2,305,499,096 1,967,257,711
65,696,536
95,572,596
167,893,005
140,880,983
Liabilities
Total Liabilities
Capital Expenditure-
Additions
852,101,141
469,524,505
391,402,477
257,279,313
65,696,536
95,572,596
1,950,193,086
372,154,760
123,752,797
82,121,704
578,593,601
175,826,431
351,933,819
112,965,480
125,068,119
129,116,679
169,025,407
131,914,637
167,893,005
140,880,983
17,129,186,516 13,001,379,260
1,477,093,159
963,257,397
9,455,622,542 5,077,039,261
10,932,715,701 6,040,296,658
375,658,708 1,185,014,759
Non Cash Expenses
Depreciation
B.
a)
7,991,099
2,315,094
Information about Secondary Segments
Revenue as per Geographical Markets
Segment
Vaccines
Formulation
Healthcare
R&D
Total
Domestic*
Overseas
Current Year
Previous Year
Current Year
Previous Year
4,139,282,326
1,798,741,628
-
-
5,938,023,954
6,123,244,312
1,604,484,560
-
-
7,727,728,872
1,478,434,793
463,560,771
-
1,699,562
1,943,695,126
308,978,240
371,532,936
5,195,312
685,706,488
* Domestic revenue includes revenue from deemed exports of Rs.3,708,466,456 (Previous Year Rs.5,797,333,245)
b)
Debtors as per Geographical Segment
Segment
Vaccines
Formulation
Healthcare
R&D
Total
c)
121
Domestic
Current Year
Previous Year
Overseas
Current Year
Previous Year
298,940,869 1,163,295,364
536,329,974
140,405,116
109,309,365
226,054,249
-
-
-
-
439,345,985 1,272,604,729
762,384,223
179,883,788
6,359,660
186,243,448
The Company has common fixed assets for producing goods for Domestic Market and Overseas Market. Hence, separate
figures for fixed assets / additions to fixed assets cannot be furnished.
11. Leases
i) For assets given under Operating Lease agreements:
a)
The Company has leased out the assets situated at Lalru, Punjab on operating lease to its Associate, PanEra Biotec
Private Ltd.
Gross Block
Accumulated Depreciation
Particulars
Current
Year
Previous
Year
Current
Year
Building
89,955,066
18,352,562
33,159,226
Furniture and Fixture
10,659,476
6,750,149
5,639,670
Previous
Year
Depreciation charged
to P&L Account
Current
Year
Previous
Year
6,605,854
5,327,263
1,305,186
3,861,199
1,151,292
638,461
Office Equipment
1,904,239
512,602
769,438
244,331
270,436
43,346
Plant & Machinery
663,486,845
316,043,799
247,986,666
146,532,544
66,307,911
27,388,797
Computer Equipment
Total
5,950,080
671,976
1,549,742
557,752
688,492
76,149
771,955,706
342,331,088
289,104,742
157,801,680
73,745,394
29,451,939
T he total of Minimum Future Lease Payments under non-cancelable operating lease for various periods for assets stated
above is as follows:
As at March 31, 2009*
As at March 31, 2008
67,600,000
9,600,000
67,600,000
-
-
-
* The Lease term for the assets given on lease vide Agreement for providing Manufacturing Facility, Utilities and Services of Employees and
transfer of raw material with PanEra Biotec Pvt. Ltd. is valid till 31.03.2011. As per the said Agreement, during the period of usage, if any, Facility
is used for manufacture of the Company’s Vaccines other than those mentioned therein or the facility remains idle due to insufficiency of
orders from the Company, no lease rental shall be payable by PanEra Biotec Pvt. Ltd. during the relevant period.
The Company has also given an office space in its building situated at B-1 Extn./A-27, Mohan Co-operative Industrial Estate,
New Delhi on operating lease to PanEra Biotec Pvt. Ltd.
b)
Total of future minimum lease payments under operating lease mentioned above:
14,000
21,000
-
-
-
-
ii.
For assets taken on Lease
a)
The Company has taken various residential, office and godown premises under operating lease agreements. These are
generally not non-cancelable and are renewable by mutual consent on mutually agreed terms. . There is no sublease
payments expected to be received at the balance sheet date and no restrictions is imposed by lease arrangements.
b)
Lease payments for the year are Rs.63,107,965 (Previous Year Rs.63,056,022).
c)
Total of future minimum lease payments under Non Cancelable operating lease:
Particulars
a) Payable within 1 year
122
9,714,882
9,357,368
12,721,625
28,116,760
12. (a) Details of Company’s share in Joint Ventures included in the Consolidated Financial Statements are as follows:
As at
As at
March 31, 2009 March 31, 2008
Sources of Funds
1. Shareholders’ Funds
a) Share Capital
b) Reserves & Surplus
2. Loan Funds
a) Secured Loans
b) Unsecured Loans
Application of Funds
1. Fixed Assets
a) Gross Block
Less : Depreciation
Net Block
b) Capital Work-in-Progress
2. Deferred Tax Assets
3. Current Assets, Loans & Advances
A. Current Assets
B. Current Liabilities & Provisions
Net Current Assets (A)-(B)
4. Miscellaneous Expenditure
53,137,540
163,121
-
7,813,063
-
11,000,281
7,790,995
3,209,287
-
1,994,049
20,522,254
11,459,002
90,63,252
7,371,297
1,723,371
143,485,483
78,995,574
64,489,909
-
122,905,261
53,485,062
69,420,199
-
Year ended
Year ended
March 31, 2009 March 31, 2008
Income
Turnover
Other Income
Total Income
269,186,069
5,737,410
274,923,479
238,787,974
15,596,464
254,384,438
Expenditure
Manufacturing & Administrative Expenses
Personnel Expenses Interest & Finance Expenses
Total Expenditure
175,809,060
40,530,528
289,382
23,761,359
240,390,329
192,195,864
48,998,905
878,015
2,119,755
244,192,539
b)
46,571,024
Subsequent Event: The Company’s Joint Venture Cambridge Biostability Limited (CBL), having regard to its financial position, has
initiated steps to place it into creditors’ voluntary liquidation, subsequent to the balance sheet date. Due to the financial position
of CBL, the Company considers its investments in CBL as well as loan given to it, doubtful of recovery. Accordingly, the following
have been provided for in the books of accounts of current year:
Particulars
Amount (INR)
Investment made
168,068,998
Loan given
108,833,850
Interest accrued on above Loan
7,275,470
Total
284,178,318
In view of the above development and consequent inability of the Joint Venture Company with regard to transfer of funds to the
Venturer, the Company has discontinued proportionate consolidation of the Joint Venture Company. Consequently, net assets
and goodwill amounting to Rs.9,532,746 and Rs.157,190,676 respectively has been adjusted in the books of accounts in the
current year. Also due to discontinuation of non-integral foreign operations, cumulative amount of gain on exchange differences
(Foreign Currency Translation Reserve) on these operations amounting to Rs.7,009,383 have been recognized as income in the
current year.
13. The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity
on departure at 15 days salary (last drawn salary) for each completed year of service subject to maximum of Rs.3,50,000. The
scheme is funded with an insurance company in the form of a qualifying insurance policy.
The following tables summarize the components of net benefit expense recognized in the Profit & Loss Account and the funded
status and amounts recognized in the Balance Sheet for the respective plans.
123
Profit and Loss Account
Net employee benefit expense - Gratuity (recognized in Employee Cost)
Particulars
Interest cost on benefit obligation
Expected return on plan assets
Net actuarial gain recognized in the year on account of return on plan assets
Net actuarial loss recognized in the year
Net benefit expense*
2008-09
2007-08
13,648,636
6,643,369
(2,770,184)
(4,275,782)
-
13,246,040
(3,452,434)
9,196,529
4,381,877
(2,026,934)
25,240,147
36,791,619
(2,265,802)
* Includes Gratuity expense of Rs.3,439,471 (Previous Year Rs.3,287,690) accounted under Research & Development Expenses.
Balance sheet
Details of Provision for Gratuity:
Particulars
2008-09
2007-08
100,695,065
87,922,995
Fair value of plan assets
Less: Unrecognized past service cost Plan (liability)
43,638,111
57,056,954
(57,056,954)
30,002,106
57,920,889
(57,920,889)
Changes in the present value of the defined benefit obligation are as follows:
Particulars
2008-09
2007-08
Opening defined benefit obligation
87,922,995
Interest cost
6,643,369
13,648,636
Benefits paid
(4,025,152)
(3,494,783)
Actuarial losses on obligation
Closing defined benefit obligation
100,695,065
54,165,505
4,381,877
9,196,529
(5,410,262)
25,589,347
87,922,996
Changes in the fair value of plan assets are as follows:
Particulars
2008-09
2007-08
Opening fair value of plan assets
30,002,106
21,981,664
Expected return
Contributions by employer
Benefits paid
Actuarial Gain /(losses)
Closing fair value of plan assets
2,770,184
14,109,975
(4,025,152)
780,999
43,638,111
2,026,934
11,054,570
(5,410,262)
349,200
30,002,106
The Company has since contributed Rs.14,809,973 to the gratuity fund.
The major categories of plan assets as a percentage of the fair value of total plan assets are as follows:
Particulars
Investments with insurer
2008-09
2007-08
100%
100%
The overall expected rate of return on assets is determined based on the market prices prevailing on that date, applicable to the
period over which the obligation is to be settled. There has been significant change in expected rate of return on assets due to the
improved debt market scenario.
The principal assumptions used in determining gratuity obligations for the Company’s plans are shown below:
Particulars
2008-09
2007-08
Discount rate
6.50% to 7.50%
8.00%
Expected rate of return on plan assets
8.00% to 9.25% 8.00 to 9.25%
Increase in compensation cost
5.00% to 12.00% 5.50 to 10.00%
Employee turnover
upto 30 years
10.00%
10.00%
5.00%
5.00%
above 30 years but upto 44 years
above 44 years
1.00%
1.00%
The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other
relevant factors, such as supply and demand in the employment market.
124
Gratuity amounts for the current and previous periods are as follows:
Particulars
2008-09
2007-08
2006-07
Plan assets
Deficit
Experience adjustments on plan liabilities
Experience adjustments on plan assets
100,695,065
43,638,111
5,705,6954
(3,286,351)
(743,588)
87,922,995
30,002,106
57,920,889
(236,689)
(238,939)
54,165,505
21,981,664
32,183,841
(21,981)
(7,984)
2008-09
2007-08
31,045,359
25,677,410
Defined Contribution Plan:
Contribution to Provident Fund
Charged to Profit and Loss Account
The Company expects to contribute Rs.17,575,000 to gratuity fund in the year 2009-10.
14. The Company has incurred expenditure on Pre-Clinical Development studies amounting to Rs.123,978,449 during the year
(Previous Year Rs.185,575,387). This expenditure relates to studies carried out by Clinical Research Organization (CRO) towards
obtaining registration of Company’s products in US and / or Europe. The expenditure incurred has been capitalized and carried in
Capital Work in Progress. Management believes that it is in the nature of development expenditure and meets the capitalization
criteria set out in Accounting Standard 26 on Intangible Assets issued by the Institute of Chartered Accountants of India due to
the following reasons:
•
the expenditure is not towards basic research and therefore no New Chemical Entity comes into being. Basic research is
conducted by the Company in its own R&D centers, but such developmental work is performed through external agencies
(CROs). Safety profile of the basic molecule is well established in several countries in Europe and in India and the product is
being marketed successfully in several countries under different brand names.
•
there is no experience to suggest that the studies conducted by CROs on behalf of the Company would lead to or make it
difficult for the Company to obtain regulatory approvals in US and / or Europe.
The management believes that these products would be commercially viable and there is no reason to believe that there is any
uncertainty that may lead to not securing registration for the products from regulatory authorities in US and / or Europe.
15. In accordance with Accounting Standard 9 on ‘Revenue Recognition’ notified by the Companies (Accounting Standards) Rules,
2006, Excise Duty on turnover amounting to Rs.18,845,112 (Previous year Rs.37,756,574) has been reduced from turnover in Profit
& Loss Account and differential Excise Duty on opening and closing stock of finished goods amounting to Rs.Nil (Previous year
Rs.Nil) has been adjusted from Raw Materials, Finished Goods, Work in Progress and Job Processing charges in Schedule XII.
16. The Company has exercised the option as per the Companies (Accounting Standards) Rules, 2009. As per the option exchange
differences related to long term foreign currency monetary items so far as they relate to the acquisition of a depreciable capital
assets are capitalized and depreciated the same over the useful life of the assets and in other cases, have transferred to Foreign
Currency Monetary Item Translation Difference Account and amortized over the balance period of such long term assets/
liabilities but not beyond accounting period ending on or before 31st March 2011, the unamortized balance in this account is Rs.
95,961,134 (Previous year Rs. Nil).
17. The Company is in the process of appointing independent consultants for conducting a Transfer pricing study to determine
whether the transactions with associated enterprises were undertaken at “arms length basis”. The management confirms that
all international transactions with associated enterprises are undertaken at negotiated contracted prices on usual commercial
terms. Further there has been no change in the terms of such international transactions till March 31, 2009.
18. Details of Loans and Advances to Associates and Parties in which directors are interested (as required by clause 32 of listing
agreement) to the extent of the share of balances outside group:
Particulars
Dues from Associates - PanEra Biotec Pvt. Ltd. (Previously known as Panheber Biotec Pvt. Ltd.)
Balance Recoverable (including Rs. 20,568,527 on account of sale of raw material grouped as sundry debtors under Schedule VII)
Current Year
Previous Year
97,543,624
67,766,327
97,543,624
67,766,327
19. Previous year’s figures have been rearranged and reclassified wherever necessary to make them comparable with the current
year’s figures.
S.R. Batliboi & Co.
Ravinder Jain
Managing Director
per Manoj Gupta
Partner
I.K. Sharma
Dr. Rajesh Jain
Place : New Delhi
Dated: May 27, 2009
125
Vinod Goel
CASH FLOW STATEMENT ANNEXED TO CONSOLIDATED BALANCE SHEET
FOR THE YEAR ENDED 31ST MARCH, 2009
Amount in Rs.
Previous Year
A.
B.
C.
Current Year
Cash Flow from Operating Activities:
Net operating profit before tax
(866,663,960)
Depreciation
714,198,042
465,881,899
Interest Expenses
321,543,582
116,455,124
Provison for Doubtful Debts & Advances
422,105
27,044,708
Interest Income
(179,781,777)
(56,486,004)
(Profit)/Loss on sale of Fixed Assets
(6,937,487)
(22,830,661)
Intangibles written off
(46,263,349)
2,103,721
Provision for Impairment & doubtful Loans
284,178,318
Unrealized Foreign Exchange (Gain)/Loss
1,689,589,699
(102,855,667)
Amortised exchange differences
47,980,567
Deferred Revenue Expenditure written off during the year
1,306,690
2,826,236,390
1,556,353
Operating profit before working capital changes
1,959,572,430
(Increase) / Decrease in Trade and Other Receivables
74,223,324
(1,052,606,073)
(Increase)/Decrease in Inventories
(2,367,283,704)
(53,828,110)
Increase / (Decrease) in Current Liabilities & Provisions
527,604,285
(1,765,456,095)
(148,473,118)
Cash generated from operations
194,116,335
Net Direct Taxes paid
(262,488,116)
Net cash from operating activities
(68,371,781)
Cash flow from investing activities:
(2,025,133,881)
(2,926,138,709)
Proceeds of deposits matured (with maturity more than three months)
1,250,968,300
402,060,214
Deposits (with maturity more than three months)
(70,376,198)
(1,250,968,300)
Sale of Fixed Assets
52,261,957
31,304,037
Interest Received
182,155,836
57,774,295
Invetsment made
(691,734,460)
(152,806,491)
Invetsments sold
149,108,804
(1,152,749,642)
-
Net cash used in investing activities
(1,221,121,423)
Net cash from operating and investing activities
Cash flow from financing activities:
Net increase in Working Capital Borrowings
1,292,036,897
256,194,912
Long Term Borrowings raised
837,914,977
2,057,104,157
Fixed Deposits received
300,500,000
Fixed Deposits repaid
(436,110,000)
Long Term Borrowings repaid
(243,100)
Movement in Securities Premium Account
-
2,263,266
Portion of (profit)/ loss in Associates
-
52,002,560
Interest paid
(313,814,246)
(114,515,280)
Dividend & Tax on Dividend paid
(81,149,949)
(76,872,959)
Net Cash from Financing activities
1,599,134,579
Net cash from operating, investing & financing activities
378,013,156
Net increase/ (decrease) in Cash & Cash equivalent
378,013,156
Opening balance of Cash & Cash equivalent
295,835,044
Closing balance of Cash & Cash equivalent
673,848,200
Note:Components of Cash and cash equivalent:
i) Cash Balance on Hand
ii) Balance with Scheduled Banks :
a) In Current Accounts
b)In Unpaid Dividend Accounts*
c) In Fixed Deposits
d)In Exchange Earner Foreign Currency Current Accounts
Cash & Bank Balances as per Schedule VI
Less: Fixed deposits for maturity period more than 3 months
Less: Effect of Exchange Differences on Cash and Cash
Equivalents held in foreign currency
Cash & Bank Balances as per Cash Flow Statements
1,876,025,059
430,869,473
2,306,894,532
(1,254,907,301)
1,051,987,231
(349,052,477)
702,934,754
(3,838,774,954)
(3,135,840,200)
2,176,176,656
(959,663,544)
(959,663,544)
1,254,672,615
295,009,071
9,243,607
2,653,554
100,130,657
1,583,956
140,844,041
496,620,469
748,422,730
70,376,198
678,046,532
4,198,332
104,179,993
1,536,608
1,314,307,829
124,125,360
1,546,803,344
1,250,968,300
295,835,044
825,973
673,848,200
295,009,071
* These balances are not available for use by the Company as they represent corresponding unpaid dividend liabilities.
S.R. Batliboi & Co.
Ravinder Jain
Managing Director
per Manoj Gupta
Partner
I.K. Sharma
Dr. Rajesh Jain
Place : New Delhi
Dated: May 27, 2009
Vinod Goel
126
Panacea Biotec Ltd.
Corporate Office
B-1 Extn./G-3, Mohan Co-op. Indl. Estate,
Mathura Road, New Delhi - 110 044, India

View - Panacea Biotec

Transcription

Similar documents

Country Club Bulletin

Kjerstin Ekvall Presentation Sysav

AVS24 2.4 GHZ Wireless Audio/Video Sender

HEMINEVRIN - Alcohol and Alcoholism

No trophy could ever fully express our

Chaise Lounge

A golden opportunity to A golden opportunity to

Please click here for project description

Building Capacity, Creating Jobs, Discovering and Developing