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Sustaining Growth, Integrating Value

Parabolic Drugs Limited | Annual Report, 2011-12

Disclaimer
In this annual report we have disclosed forward-looking information to enable investors to comprehend our prospects and take informed investment decisions. This report and other statements written and oral that we periodically make contain forward-looking statements that set out anticipated results based on the managements plans and assumptions. We have tried wherever possible to identify such statements by using words such as anticipates, estimates, expects, projects, intends, plans, believes and words of similar substance in connection with any discussion of future performance. We cannot guarantee that these forward-looking statements will be realised, although we believe we have been prudent in assumptions. The achievement of results is subject to risks, uncertainties and even inaccurate assumptions. Should known or unknown risks or uncertainties materialise, or should underlying assumptions prove inaccurate, actual results could vary materially from those anticipated, estimated or projected. We undertake no obligation to publicly update any forwardlooking statements, whether as a result of new information, future events or otherwise.

Vision
To become a globally acceptable API and pharmaceutical manufacturing company by providing quality products that exceed customer expectations and are produced in a safe working environment

Mission
To be the chosen strategic partner of the worlds top ten pharmaceutical companies To grow consistently by entering Custom Synthesis and Contract Manufacturing relationships with large Generic and innovator companies To leverage our cost efficiencies in manufacturing to penetrate world markets across therapeutic segments, including oncology, cardiovascular and anti-hypertensive, among others

Parabolic Drugs - One of the leading Pharmaceutical Companies


Well positioned to sustain its growth, to build the Value to the stake holders

Growth driven by: research capabilities robust chemistry skills world class facilities with regulatory approvals integrated growth - horizontal and vertical Strong foothold in over 50 countries
Turnover (Million) PAT (Million) EBIDTA (Million) Net Worth (Million) Gross Block (Million)

` 10123
5 years CAGR 35%

` 512
5 years CAGR 30%

` 1614
March 31, 2012

3039
March 31, 2012

4076
March 31, 2012

Parabolic Drugs Limited | Annual Report 2011-12

Presence
Headquartered in Chandigarh. Operational in 50+ countries (including regulated markets). Listed on the National Stock Exchange (PARABDRUGS) and the Bombay Stock Exchange (533211).

Business
Engaged in the manufacture including contract manufacture of APIs and API intermediates for sales in India and abroad. In the FY 12, moved up the value chain by foraying into the formulations space.

Products
Manufactures over 50 APIs (Active Pharmaceutical Ingredients - sold to formulators to make capsules, tablets, liquids, injections and other dosage forms). Diversifying its product basket with over 20 molecules across 10 therapies in the FY 13-14.

Legacy
Parabolic Drugs Ltd was founded in 1996 by first generation entrepreneurs - Mr. Pranav Gupta & Mr. Vineet Gupta. In 2012, the Company has facilities, across four locations, two state of the art manufacturing plants at Derabassi and Panchkula for APIs, one Custom Synthesis and R&D centre at Barwala and one lifestyle drug manufacturing site at Chachhrauli. Employs over 1400 multi skilled professionals. Listed with BSE & NSE on July 1, 2010.

Facilities
Derabassi (Punjab): This facility has seven units manufacturing the oral and sterile range of cephalosporin APIs and intermediates. Panchkula (Haryana): This facility has two units manufacturing SSPs and API intermediates such as 6-APA. Barwala (Haryana): The research and development centre develops and scales new APIs and API intermediates in all therapeutic segments including non-antibiotic products. It also provides contract research services to innovator companies. Chhachrauli (Punjab): Multi block built in a 27 acre site for drugs for manufacturing non-antibiotic APIs in the new therapies such as CVS, CNS, oncology, antithrombotic, anti-diabetic and pain management.

Regulatory strength
As on date, PDL has filed 23 process patent applications with Indian Patent Office, New Delhi and 43 Drug Master Files across US, EU, Korea, Japan and Canada

Certifications
ISO 14001-2004 OHSAS 18001-2007 WHO-GMP European GMP from EDQM, European Union US FDA (for 6-APA at Panchkula) Japanese PMDA Korean FDA

Geographical Spread Exporting to 50 countries & counting...

43

Drug Masters Filed across US, EU and Canada till date

Performance Highlights 2011-12

Spent on R&D (In Million)


412.01
2010 2010

120+ 1400+ 49%


Sales to regulated markets

Scientists including P .hDs.

23

EBIDTA (Rs. Million)


923.24

Process Patents and one PCT filed with Indian Patents Office, New Delhi

Employees working towards the common vision Markets penetrated across the globe

50+

Total Revenue (Rs. Million)


5,590.10

2010

2011

689.68
2011

1,271.45

2011

6,752.97

2012

943.39
2012

1,614.31

2012

10,123.08

Capex Spent (In Million)


600.30
2010

Networth (Rs. Million)


1,210.55
2010

Profit After Tax (Rs. Million)


341.99

2010

2011

1,125.36
2011

2,879.35

2011

528.73

2012

997.88

2012

3,039.00

2012

512.12

Parabolic Drugs Limited | Annual Report 2011-12

The Value Matrix


Spreading to the new geographies Attaining the highest levels of Quality Growing with R&D

Headway in the CMO and CRO space

The horizontal growth

The vertical integration for value maximization

Milestones
Foray into herbal nutraceuticals Commissioning of multi-purpose block 3 & New Sterile Facility Approval from Korean FDA Filing of 7 DMFs across US, Korea and Japan Entry into finished dosage space Diversification into non antibiotics
12 20 11 -

Listing of company on the stock exchanges Received accreditation for compliance with European Good Manufacturing Practices standards 18 regulatory filings Received 'Certificate of Suitability' (COS) for Cefixime Received DNV's certificate for OHSAS 18001-2007 standards Commencements of commercial operations in the Multipurpose block 2 at Derabassi that added 325 TPA Cephalosporin capacities Recognized as a Star Export house by the Ministry of Commerce Filed 7 patents applications in FY 11

20 10 -

11

Certified by WHO-GMP for the Derabassi facility Received ISO 14001-2004 certification for environment and safety management at Derabassi Commissioned new R&D Centre at HSIIDC, Barwala Filed six Drug Master Files in the US and Europe

20

08

-0

Diversified into Cephalosporin production

Diversified into custom synthesis for innovator companies Commissioned two plants for additional Cephalosporin API capacities Filed eight DMFs in the EU / US Filed nine patent applications

20

07

Filed three US DMFs Established a sterile facility Commissioned a dedicated R&D wing

-0 8

05

-0

Filed COS for two Penicillin APIs in the European Union

20

-0 5

Commenced commercial operation of PDL II plant at Panchkula

20

03

-0 2

Commenced contract manufacture for DSM and Ranbaxy

20

00

-9

Commenced commercial operation of PDL I at unit in Derabassi for Penicillin API and API intermediates

19

97

20

09

-1 0

Parabolic Drugs Limited | Annual Report 2011-12

Managing Director's review

Creating a responsible enterprise that delivers "Value"


At the outset, I would thank you for being with us and reposing your confidence on the management. The company has consolidated its position during the last financial year and has set drivers in place for laying a strong foundation for the future. I do believe strongly that the strategic decisions taken by management over the last couple of years will yield positive results in the coming year. The year 2011-12 has been a tough one in the face of the tightened liquidity scenario, high interest rates, the euro zone debt crisis and the depreciation of Indian currency. Despite the fiscal challenges affecting the operating environment, the company has achieved a gross turnover of INR 10123 million for the year 2011-12. This represents a growth of 50% over the last year. Net Profits came in at INR 512 million, which represents a margin of 6%. The fall in net profit margins by 250 bps was on account of high interest rates and rising cost of imported raw material. Amongst the operational achievements and developments, at the Derabassi site, your company has successfully commissioned the Multi-Purpose Block that augments the amorphous capacities. In the sterile space, with the commissioning of new sterile block, the company has doubled its capacity to 20 tons per annum for the manufacturing of the sterile range of products. With the expansion the stage is set for the company to build on its accomplishments during the coming year. The current fiscal was also significant as the company diversified horizontally to minimize its dependence on a single segment for growth. From being a standalone antibiotic manufacturer, your company is becoming a differentiated antibiotic and non-antibiotic API manufacturer. The company has activated production for the life style drugs from its new facility in Lalru. The company has been working in over 10 different therapies covering cardiovascular, hypertensive, diabetes, oncology, osteoporosis and central nervous system. The company looks to build revenues and growth on the new range of products that would not only bolster the top-line, but more importantly, concentrate on expanding margins. With infrastructural expansions in place, right set of skills and capabilities in research and chemistry, a diversified basket of products, your company has all the drivers in place for the next level of growth - the growth that drives the value for each of the stakeholders.

Our objective towards creating a responsible enterprise will be led by the following actions:

Taking your company to newer geographies Your company has a considerable presence in over 50 countries. Historically, our growth in these markets has come through the antibiotics orals. With the expansion of sterile basket, addition of new verticals and products, your company looks to strengthen its presence across the globe, especially the regulated markets. The Regulated markets will also add a thrust to the margins and profitability.

Achieving highest International quality standards Your company hasa distinctive recognition of being one of the few pharmaceutical companies certified by the European GMP . With the audit approvals of over 40 pharmaceutical companies, your company foresees the regulatory approvals through other international agencies including the Japanese PMDA and the USFDA

Growth through developments in research and development The research team at Parabolic continues to drive the business by creating a grid of niche molecules and working on the next generation of products. Going forward, the in-house R&D team would continue to drive process research and find innovative ways to reduce cost and build competitiveness.

Headway in the Contract manufacturing Space Leveraging on the world class infrastructure with large capacities, a cost arbitrage in respect to competition, your company is geared to provide integrated solutions from route selection, process development, and optimization to different innovators and generic companies of the globe. It will continue to develop the competitive advantage it already possesses in the area of contract manufacturing and research to be able to grow and add scale to this segment of business.

Horizontal growth through the diversified basket Our foray into the non-antibiotic space places us in an unique position to be one of the largest API companies with a multiple range of products across varied therapies. The transition towards becoming a multi-specialty API manufacturer is going to de-risk the company's sizable reliance on antibiotics, where a couple of products have got commoditized and margins have been affected by competition. We believe that the new life style drugs will drive margins and hence profitability.

Vertical integration for value maximization The company moved up the value chain by launching its finished dosage business. The company successfully created a basket of over 150 products across multiple therapeutic classes in different dosage forms. The dosage business will substantially add to the value of the company in the forthcoming years. The thrust for the formulations business would be through two verticals - the domestic formulations through our division 'Nucleus' and the International Formulations division.

Business Outlook Parabolic Drugs will strive to continue the consistent growth that it has displayed over the last couple of years with increased commitment and focus on the bottom line. The company will achieve to realize this through operational efficiencies, improvements and innovation across production, marketing, research and other capabilities. The rationale is just not to create an organization of growth and profits, but to create a responsible organization which drives its business with excellence and sustainability. The key focus areas for the management in the coming year would be to: Focus on Regulated Markets of US, European Union, Canada, Japan, and Australia- filing of drug master files, certificate of suitability, and dossiers. Product basket- Launch of new molecules in the non-antibiotic space and diversify the product basket for a risk free sustainable growth Diversification into new business verticals- Integration into Finished Dosage formulations, entering into manufacturing alliances for inorganic growth Investment in R&D- development of new products , improving efficiencies in the existing range, filing of patents and building IPR wealth High GMP Standards- maintaining high GMP standards for seeking regulatory approvals from USFDA, PMDA, TGA amongst others. Safety, Health & Environment- safety of our human resource, our manufacturing facilities and our environment, conservation of resources and to be a responsible social citizen for a greener tomorrow Development of Human Resource- foster the skills, talent and efficiency of the human minds I thank you for the faith and conviction you have placed in us and I do believe that the company is poised for greater laurels in the future with your continued support, motivation and guidance. Regards

Pranav Gupta

Parabolic Drugs Limited | Annual Report 2011-12

Spreading to the new geographies


Parabolic Drugs with its operational experience of over 14 years has scaled its reach to different parts of the world. The company today has its presence in over 51 countries across the globe. The accelerated geographic spread has been driven by the company's continuous focus on the regulatory filings, compliance with the International quality standards, meeting the stringent customer specifications and being competitive with the cost. The company's key presence across European Union, Turkey, Latin America, Middle East, Asia Pacific, North Africa and SAARCfamiliarizes it as India's leading antibiotic company. However going forward, the company with its strategic shift in the product therapies and its approach to the new countries is likely to add value to the business. Over the next years, by way of its horizontal growth in the product basket, with the addition of new products in the non-antibiotic space, the company looks to strengthen its presence in the world with a planned approach by:

Exploring the high growth markets of China, Korea, Turkey, Mexico, Argentina and Brazil. These markets are likely to add impetus to our growth. With regulatory approvals in place, the company aims to fortune its growth and market development in the regulated space. The company is buoyant on the opportunities from the markets of Japan, European Union and of late the United States of America.

Entering the new markets of South East Asia with the new products that complement the disease and life style pattern of the countries. Responding to the market dynamics by exploring new molecules that are off patent in different countries

Result : Parabolic Drugs will become a leading pharmaceutical player with strong presence in all major countries of the world Parabolic Drugs will add value to its revenues and margins by tapping the high margin regulated space Parabolic looks to capitalize its revenues by yielding growth from the emerging economies including Korea, Brazil, Mexico and China.

Our Quality Policy


To achieve Customer Satisfaction by providing High Quality Products through Continual Improvement in Processes, Technology Up-gradation, Competent Employees and Investment in Research & Development

Attaining the highest levels of quality


The Global pharmaceutical market over these years has undergone a significant transition from focusing just on GMP to a complete Quality management System. The companies in the pharmaceutical space have a detailed focus on the customer, their needs and internal efficiencies. The responsibilities for the quality systems range across all activities associated with development and manufacturing (purchase, storage, production, quality control, release and distribution) of APIs. Quality is just not compliance at Parabolic; it is a philosophy, a core belief of management, its employees and the processes. As an integrated approach, the company strives to achieve the highest level of quality across all functions and with an objective of continuous improvement and development. The dedicated quality control and quality assurance departments work in line with the stringent quality guidelines and GMP framework. The company is committed to all compliance standards andThe Quality Function has responsibility for ensuring that all activities in the system are conformed with. Quality Control Department A fully equipped QC department ensures that all the inputs are in accordance as per defined specifications and standards. Ensures that every material entering the premises is sampled and tested before use. Ensures that product is meeting the required quality specifications. Quality Assurance Quality Assurance Unit is responsible for formation, implementation and maintenance of the quality system across all units of PDL. Quality assurance follows global guideline of API, ICH Q7A for the implementation of the system.

Result:

Parabolic classifies itself in the elite list of pharmaceutical companies that focus on the world class quality with cost effectiveness

The company is a preferred supplier to leading generic and innovator companies in India and abroad.

Parabolic Drugs Limited | Annual Report 2011-12

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Growing with Research and Development


For a pharmaceutical company to sustain, prosper and grow, it must do more than keep up with its competitors. Moving ahead with innovation, process research, optimization, developments, and identifying breakthroughs are what the researches are about. Parabolic is aware that tomorrow's growth depends to a broad extent on the today's research, and the fact that the investments in research will generate long term gains for several years to come. The research activities at Parabolic encompass:

Development of new products and


chemistry for the molecules that are identified by marketing for supplies across the globe. Evaluation of patents, synthetic route study through non-infringement process before starting development work Providing quality documentation to Quality assurance, Regulatory affairs for filing DMFs in the regulated space Process validation activities jointly by Cross functional teams Writing of validation protocols as per regulatory and GMP guidelines

Korea and Canada. To increase its access to these markets and to make its products acceptable, Parabolic Drugs has been filing the drug master files for its products across these markets. With the filing of DMFs, the company spectacles its strong regulatory hold Till date, the company has filed over 43 Drug master files. Patents of the non-fringing processes being developed for Non-antibiotics and antibiotics IP Management work is carried by the cell largely in areas of filing patent applications, patent prosecution for granting and doing searches like Novelty, Infringement, Validity & other State of the Art searches, which support Marketing & Research department to make their strategy on patents related issues. As on date, PDL has filed 23 process patent applications on of its non-infringing processes.

Development of innovative processes for


latest generation Beta lactam APIs and NonBeta Lactam APIs of world class quality Bring efficiencies in existing products by optimization and process research

Filing of Drug Master Files and documents with the regulated markets. In the longer term, the exports for the company are likely to be driven by the regulated sales coming from the markets of Europe, US, Japan,

Result: The value of the company gets multiplied by the interplay of its intangible assets, filing strengths, broadly its Intellectual property. The company , going forward, will be fetching maximum sales from the regulated markets The domestic foothold of the company will build further with the efficiencies coming in for the existing range of products. The company has a diversified basket of as many as 20 products to be launched over the next few years.

Headway in the CRO and CMO space


Backed by a large support of infrastructure, easy to access population and a cost arbitrage of over 30% in comparison to the regulated world, the Indian CRO market is set to more than double by 2016. The Clinical research market is likely to be a USD 1 billion market in 2016 Parabolic offers CRO and CMO services in India with complete integrated R&D, Chemistry, technology and engineering services. PDL has the capability to provide integrated solutions from route selection, process development, and optimization. Its expertise also entails scalable technology development which can be scaled up to multi tones scale. Our Services Non GMP &GMP manufacturing of intermediates & API Submission of drug master file / Small Scale Synthesis support to client Literature search & novel route Long term contract manufacturing scouting Small scale synthesis of multi-step & Our Strengths complicated chemicals Characterization of molecules & impurities Cost Effectiveness in the services and commercial scale up Process R&D One stop destination for all services Route selection & optimization Compliance with international GMP Method development & validation and regulatory authorities Synthesis of GMP / non GMP IP protection and confidentiality material Support in the regulatory database Technology transfer and documentation Commercial scale up in the large Manufacturing & commercialization scale facilities Technology transfer

Result: With all drivers set in place, the company aims to maximize its margins from CRO & CMO Business

Parabolic Drugs Limited | Annual Report 2011-12

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The horizontal growth


Changing Lifestyle, an evolving disease pattern and the transition of the global world towards the generics gives an opportunity to our company to grow horizontally- that is to expand our basket of products. From just being an antibiotic company, Parabolic has diversified into non antibiotic therapies. The company has set up a 27 Acre manufacturing facility dedicated to manufacturing of life style drugs. The company is working on over 15 different therapies for the launch of molecules across the changing disease pattern. Some of the key therapies that the company is working on :
S.No. 1 Therapeutic Category Analgesic To relieve pain Treatment Market Potential The global market for Analgesics is forecast to reach US$34.6 billion by the year 2015. Key factors driving market growth include graying population, surging number of surgical procedures, and increasing number of cancer and AIDS patients. The global antiarrhythmic market will be worth $3.5 billion in the coming three years

Anti-arrhythmic

To suppress abnormal rhythms of the heart (cardiac arrhythmias), such as atrial fibrillation, atrial flutter, ventricular tachycardia, and ventricular fibrillation. To combat the effects of the asthma cascade (bronchoconstriction, inflammation, edema)

Anti-asthmatic

The global market for asthma was valued at $34.9 billion in 2011. This figure is projected to reach $38 billion by the end of 2012 and $47.1 billion in 2017, increasing at a fiveyear compound annual growth rate (CAGR) of 4.4%. One of the most lucrative markets in the globe. Expected to grow over USD 100 billion by 2019. Significant growth to be seen from the emerging markets owing to their changing lifestyle

Anti-diabetic

To treat diabetes mellitus by lowering glucose levels in the blood.

The vertical integration for value maximization


In the year 2011, the company scaled up the value chain to the finished dosage business. While the inhouse manufacturing facility getsthe commercial nod, the company's formulation business in the domestic market market has been set in place. The strategy to penetrate the global markets with a basket of niche products backed by the inhouse API will the way forward for the formulations business. The company shall bring a wide product range covering Tablets, Capsules, Injectables, Dry Syrups and Respiratory capsules across high value therapeutic segments like Antibiotics, Anti-diabetics, Anti-Asthmatics, Antihypertensive, Hormones, Nasal sprays and solutions etc. Way Forward : Nucleus Nucleus has been able to attain a minimum monthly sales base of INR 10 mio with 178 products within 15 months of its launch Going forward, with a basket of 500 products in two divisions and geographical period of five years. International Formulations division The strategic initiatives are driven by two divisions across the different verticals: 1. 2. Nucleus- A division of Parabolic Drugs for the domestic formulations space International Formulations Division for the sales of niche molecules where PDL has a backward integration Submission of over 100 dossiers across different parts of world Developing IPR with over 60 brands registered in the name of company The company is investing and going forward shall build its own USFDA approvable facilities. reach all over India, the division looks to touch a topline of INR 1000 million in the

Parabolic Drugs Limited | Annual Report 2011-12

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Board of Directors Report


The Board of Directors of your Company has pleasure in presenting the Sixteenth Annual Report on the affairs of the Company together with the Audited Accounts of the Company for the year ended 31st March, 2012.

1. Financial Results:
The Financial Results for the year under review vis--vis the financial results for the previous year are as under: (` in million)

Particulars
Gross Sales Profit before Depreciation, Interest & Tax (PBDIT) Financial Expenses Depreciation Profit before Tax (PBT) Provision for Taxation: - Current Tax - Deferred Tax Less: Taxation Adjustments for earlier years Profit after Tax (PAT) Profits available for equity shareholders Appropriation: Proposed Dividend on Equity Shares Corporate Dividend Tax Surplus carried to Balance Sheet Earnings per Share(Basic) Earnings per Share (Diluted)

2011-2012
10123.08 1406.32 641.37 100.54 664.41 132.88 19.41 512.12 512.12 15.47 2.51 494.14 8.27 8.27

2010-2011
6752.97 1177.03 407.60 82.61 686.82 136.88 21.21 8.48 520.25 520.25 30.95 5.14 484.16 9.43 9.43

Financial Analysis and Review of Operations: Your directors are pleased to report performance of the business operations as follows: Sales and Export: During the year under review, your Company has registered Gross sales of Rs. 10123.08 million as compared to Rs. 6752.97 million in the previous year showing an increase of 49.91 percent. Further, your Company has registered an export of Rs. 1478.17 million as compared to Rs. 2301.99 million in the previous year showing a decrease of 35.79 per cent. A fall in the exports has been recorded on account of unrest in the global markets, the crisis in the Middle East and in Euro zone. Profitability : The Company earned profit before depreciation, interest and tax (PBDIT) of Rs.1406.32 million as against Rs. 1177.03 million in the previous year, showing an increase of 19.48 per cent. The Company earned profit before tax (PBT) of Rs. 664.41 million as compared to Rs. 686.82 million in the previous year, showing a decrease of 3.26 percent. After making provision for tax of Rs. 152.29 million (previous year Rs. 158.09 million), net profit worked out to Rs. 512.12 million as compared to Rs. 520.25 million in the previous year showing a decrease of 1.56 percent mainly due to increased cost of imported raw material, due to depreciation in rupee value, and higher interest cost. Fixed Assets : The net fixed assets (including work-in-progress) as at 31st March, 2012 were Rs. 3751.81 million as compared to Rs. 2752.07 million in the previous year.

4. Dividend :
The Board of Directors of your Company has recommended a dividend of Rs. 0.25 per share on the Fully Paid-up Equity Share of the Company.

5. Subsidiary :
During the year under review, the Company had floated a new subsidiary Company namely M/s. Ziven Lifesciences Limited to carry on the formulations business. The present paid-up capital of that Company is Rs. 1,04,00,000/- out of which your Company holds 90.38% share capital of that Company. Further, your Company holds 98.99% of paid up capital of Rs. 4,95,00,000/- of Parabolic Research Labs Limited, another subsidiary of your Company. A statement under Section 212 of the Companies Act, 1956 of the subsidiary companies is annexed hereto.

6. Management Discussion and Analysis Report :


Management Discussion and Analysis of financial conditions and result of operations of the Company for the financial year 2011-12, as required under Clause 49 of the Listing Agreement are annexed hereto as a separate statement in the Annual Report.

7. Corporate Governance Report :


The Company aimed to conduct its affairs in an ethical manner. A separate report on Corporate Governance which forms a part of the Annual Report is annexed hereto. A certificate from the Statutory Auditors of the Company regarding the compliance of conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement is annexed to report on corporate governance.

2. Directors :
Dr. Ram Kumar and Mr. Inder Bir Singh Passi, Directors of your Company, retire by rotation at the forthcoming Annual General Meeting and being eligible, offer themselves for reappointment.

8. Auditors :
M/s. S.K. Bansal & Company, Chartered Accountants, Chandigarh, the Statutory Auditors, are retiring at the conclusion of the forthcoming Annual General Meeting and being eligible, offer themselves for re-appointment. They have also given their eligibility in terms of Section 224 (1B) of the Companies Act, 1956. The Audit Committee and Board of Directors have recommended their appointment for the financial year 2012-2013 to the members for their approval in the ensuing Annual General Meeting.

3. Share Capital :
During the year under review, there is no change in the Share Capital of the Company.

Parabolic Drugs Limited | Annual Report 2011-12

17

9. Auditors' Report :
The Auditors' Report on the Accounts of the Company for the year under review is self-explanatory and requires no comments.

proactive policies for industrial relations, the industrial relations between the employees and the management remained peaceful and cordial throughout the year at all offices and units of the Company.

10. Audit Committee :


During the year under review, the Audit Committee was reconstituted. The constituent members of the Audit Committee are Mr. Nikhil Goel, Mr. Inder Bir Singh Passi, Mr. Arun Mathur and Mr. Pranav Gupta. Mr. Nikhil Goel is the Chairman of the Audit Committee. The Committee met five times during the year. The detailed information pertaining to Audit Committee of the Company is given in the Corporate Governance report.

15. Statement of Particulars of Employees :


A Statement of Particulars of Employees pursuant to the provisions of Section 217(2A) of the Companies Act, 1956 is annexed hereto and forms part of this report.

16. Group :
The Company, inter-alia with the following entities, constitutes a group as defined under the Monopolistic and Restrictive Trade Practices Act, 1969: a) PNG Trading Private Limited b) Parabolic Infrastructure Private Limited

11. Cost Auditors :


The Board of Directors had re-appointed M/s. Anil Sharma & Co., Cost Accountants, Chandigarh, as the Cost Auditor of the Company for the financial year 2011-12. The Cost Auditor's report for the financial year 2011-12 will be forwarded to the Central Government as required under Law.

17. Directors' Responsibility Statement :


Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Directors confirm that:a. in the preparation of the annual accounts, the applicable accounting standards have been followed; b. appropriate accounting policies have been selected and applied consistently, and have 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 as at 31st March, 2012 and of the profit of the Company for the year ended on 31st March, 2012; c. proper and sufficient care has been taken 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 d. the annual accounts have been prepared on a going concern basis.

12. Internal Control System :


The Company has well defined internal control system. The Company takes abundant care to design, review and monitor the working of internal control system. Internal Audit in the organization is an independent appraisal activity and it measures the efficiency, adequacy and effectiveness of other controls in the organization. All significant issues are brought to the attention of the Audit Committee of the Board.

13. Fixed Deposits :


During the year 2011-12, the Company has not invited/accepted any deposits from the public in terms of the provisions of Sections 58 A and 58 AA of the Companies Act, 1956.

14. Human Resources / Industrial Relations :


Your Company continues to lay emphasis on continued qualitative growth of its human resources by providing a congenial and conducive work environment in consonance with its belief that the real strength of its organisation lies in its employees. During the year the Company employed over 1000 employees. As pursuit of

18. C o n s e r v a t i o n o f E n e r g y, Te c h n o l o g y Absorption, Foreign Exchange Earnings and Outgo :


Energy conservation continues to be an area of major emphasis in our Company. The Company has adopted the

strategy of bringing about a general awareness amongst all regarding energy conservation. Particulars with respect to conservation of energy and other areas as per 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, are annexed hereto and form part of this report.

Your Directors also express their deep appreciation for the devoted and sincere services rendered by employees at all levels of operations of the Company during the year and we are confident that our Company will continue to receive such co-operation from them in future also.

For and on behalf of the Board Vineet Gupta Whole Time Director Place: Chandigarh Dated: 14th August, 2012 Pranav Gupta Managing Director

19. Acknowledgement :
Your Directors are pleased to place on record their sincere gratitude to Government, Financial Institutions, Bankers and Business Constituents for their continued and valuable co-operation and support to the Company.

Parabolic Drugs Limited | Annual Report 2011-12

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Annexure to the Board of Directors Report


INFORMATION AS PER SECTION 217(1) (e) READ WITH COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF BOARD OF DIRECTORS) RULES, 1988 AND FORMING PART OF THE DIRECTORS' REPORT FOR THE YEAR ENDED 31ST MARCH, 2012:

1. Conservation of Energy :
Your Company has always been conscious of the need to conserve energy and also reduce the cost of production. We hold regular meetings in our units for discussions on the various energy conservation measures and implement them. Various energy conservation measures taken during the year include use of condensate water in boilers, separation of high and low pressure air lines, change of cooling tower fills, improvement of refrigeration system, provision of PSA system in Amorphous plants and Power trading etc. The details regarding the present energy consumption are furnished below as per form A of the annexure to the rules.

Form-A
A. Power & Fuel Consumption: Particulars 1. Electricity a) Purchased Units Total Amount Rate per Unit b) Own Generation i) Through diesel generator Units Units per litre of Diesel Cost per Unit ii) Through steam turbine/generator Units Units per litre of fuel oil/gas Cost per Unit 2. Coal Quantity Total Cost Average Rate 3. Furnace Oil : Quantity Total Cost Average Rate 4. Others /Internal Generation Quantity (Timber & Husk) Total cost Rate/Unit Ton ` in million `/ton 8258.41 40.85 4946.71 7230.61 31.20 4315.58 K. Litres ` in million `/ litre 20.00 1.15 57.36 59.70 2.84 47.60 Ton ` in million ` /ton KWH in million KWH `/KWH 1.47 3.00 13.66 0.97 3.00 12.03 KWH in million ` in million `/KWH 16.20 98.04 6.05 11.33 60.96 5.38 Unit 2011-2012 2010-2011

B. Consumption Per Unit of Production: Production of Different Products Electricity Furnace Oil Coal (MT) Furnace Oil (Litres) Others/Internal Generation (*) Variation due to change in product mix KWH/KG 5.65* 5.38*

2. Technology Absorption :
Efforts made in technology absorption are furnished in Form B as under:

adoption of latest technology in its all plants. The Company has also created specific R & D and other cells for studying and analyzing the existing process for further improvement. b) i) ii) iii) Particulars of Imported Technology in last five years: Technology Imported Year of Import Has the Technology been fully absorbed : : : NIL Not Applicable Not Applicable

Form -B
A. Research and Development(R&D) : a. Specific areas in which Research & Development is carried out by the Company : R & D has been carried out in areas of improvement on Product, Process, Cost Reduction, development of new products like Montelukast, Bortezomib and Anti Diabetic Compounds like Sitagliptin, Vildagliptin etc. and increase in Productivity. b. Benefits derived as a result of above R & D : The Company was able to improve the quality of existing products like Cefuroxime Axetil and develop new products Strontium Ranelate, Febuxostat and was also able to reduce the cost of Production. c. Further course of action : We intend to develop new product, to further reduce the cost and improve capacity utilization. d. Expenditure on R & D : (` in million) 2011-12 Capital Recurring Total 10.01 933.38 --------------943.39 --------------2010-11 49.52 640.16 -------------689.68 --------------

3. Foreign Exchange Earnings and Outgo :


a) Activities relating to Exports, Initiative to increase : The Company exported Semi Synthetic Penicillin (oral and sterile) and Cephalosporin (orals and sterile) and non antibiotic products to various overseas customers. Our products are being exported to more than 50 countries across the globe. The Company has several international regulatory approvals giving it an access to major markets like EU, Japan, US etc.. The Company has understood the need of customer relationships and identified potential customers across the globe and initiated visit to meet them in order to know more about them and their requirements. The Company has also participated in various international/National Business fairs in order to interact with Customers. b) Total Foreign Exchange used and earned: (` in million) 2011-12 1. Earnings (FOB Value of exports) 1212.46 2010-11 1736.17 2631.11

Total R& D expenditure as a percentage of turnover: 9.32% B. Technology Absorption, Adaptation and Innovation : a) Effort made: The Company is continuously making efforts for

2. Outgo (CIF Value of imports 1872.94 and Expenditure in foreign currency)

Parabolic Drugs Limited | Annual Report 2011-12

21

Statement of Particulars of Employees


Information required as per Section 217(2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 and forming part of Board of Directors' Report for the year ended March 31, 2012
A) Persons employed throughout the financial year, who were in receipt of remuneration for the year which, in the aggregate, was not less than Rs. 60,00,000 per annum. S No. Particulars Name 1. 2. 3. 4. 5. 6. 7. 8. 9. B) Designation of Employee Remuneration Received Nature of Employment Nature of Duties Qualifications & Experience Date of commencement of Employment Experience Age Last Employment held Mr. Pranav Gupta Managing Director Rs. 96,00,000/Contractual Managerial B. Tech (Mechanical), M.B.A. 01.11.1997 22 years 45 years Ford Motor Company Details as on 31.03.2012 Mr. Vineet Gupta Whole Time Director Rs. 84,00,000/Contractual Managerial B. Tech (Mechanical) 01.11.1997 21 years 43 years N. A Mr. Malcolm Rosenthal Executive Vice President (Global Business Development) Rs. 106,24,294/Non Contractual Business Development B.Sc., MBA 24.01.2011 26 years 53 years Austin Chemical Company, USA

Persons employed for a part of the financial year, who were in receipt of remuneration for any part of the year, at a rate which, in the aggregate, was not less than Rs. 5,00,000 per month. Details as on 31.03.2012 Dr. P . B. Deshpande Chief Scientific Officer Rs. 26,24,398/Non Contractual Scientific Research M.Sc., P .hd 02.08.2010 27 years 57 years Emcure Limited, Pune Mr. Seetaraju Gembali President-Formulation Business Rs. 24,51,386/Non Contractual Formulation Business M.Pharm( Pharmaceutics) and Diploma in marketing management 05.12.2011 23 years 48 years Mid Pharma and Promed Research, Jordan

S No. Particulars Name 1. 2. 3. 4. 5. 6. 7. 8. 9. Notes: Designation of Employee Remuneration Received Nature of Employment Nature of Duties Qualifications & Experience Date of commencement of Employment Experience Age Last Employment held

1. Remuneration includes salary and other perquisites (in case of Mr. Pranav Gupta and Mr. Vineet Gupta) 2. Remuneration includes Salary, Other Allowances and Provident Fund ( in cases of rest of the employees) 3. Mr. Pranav Gupta and Mr. Vineet Gupta are related to each other. 4. Mr. Pranav Gupta and Mr. Vineet Gupta are holding 824,100 and 701,550 Equity Shares of the Company respectively . 5. Dr. P . B. Deshpande resigned from the Company w.e.f. 14th September, 2011.

Statement Pursuant to Section 212 of the Companies Act, 1956 Relating to Subsidiary Companies:
Name of Subsidiary Company Financial Year ending of the Subsidiary Number of Shares held ( Face Value) Extent of Holding For Financial Year of the Subsidiary For the Previous Financial Years since it became a Subsidiary

Profit/(Losses) so far it concerns the members of the Holding Company and not dealt with the books of Accounts of the Holding Company (Except to the extent dealt within Col.6) 1 Parabolic Research Labs Limited Ziven Lifesciences Limited* 2 31.03.2012 3 2,950,000 ( Rs. 10 each) 4 98.33% 5 Nil

Profit/(Losses) so far it concerns the members of the Holding Company and dealt within the books of Accounts of the Holding Company.

Profit/(Losses) so far it concerns the members of the Holding Company and not dealt within the books of accounts of the Holding (Except to the extent dealt within Col. 8)

Profit/(Losses) so far it concerns the members of the Holding Company and dealt within the books of accounts of the Holding Company

6 Nil

7 N.A.

8 N.A.

31.03.2012

399,996 ( Rs.10 each )

79.99%

Nil

Nil

N.A.

N.A.

Note: *The financial year of the Ziven Lifesciences Limited was from 01.11.2011 to 31.03.2012.

For and on behalf of the Board

Vineet Gupta Whole Time Director

Pranav Gupta Managing Director

Place: Chandigarh Dated: 14th August,2012

Vipin Gupta Vice President & Company Secretary

R. C. Goyal Senior Vice President (Finance)

Parabolic Drugs Limited | Annual Report 2011-12

23

Management Discussion and Analysis


Global economy and Indian Scenario
Over the past couple of years, the economic development across the globe has been volatile; it may have been a result of natural disasters, a volatile belief of investors, the crisis with the global giants or the changing global environment. The year 2011 in particular has really been weak. Despite all these adversities, the economic news during the first half of 2012 has been positive. Significant structural , fiscal and monetary steps in Europe during the first half of 2012 have contributed to improvements in the marketing sentiment. On an assumption that the conditions in the European Union will not worse further, as per the world bank, global GDP is projected to increase 2.5 percent in 2012, with growth accelerating to 3.0 and 3.3 percent in 2013 and 2014.Output in the Euro Area is projected to contract by 0.3 percent in 2012, GDP in developing countries is projected to expand 5.3 percent in 2012. However, in the global economy, India is projected to see a faster growth of 6-7 per cent this fiscal, on the back of higher savings and investment rates, even as most of the Asia-Pacific economies are likely to expand at a slower pace. In the FY 12, India witnessed a tough time to achieve its growth targets and control on inflation. The Economic growth slightly declined to 6.9% in FY 12, although it remained one of the fast growing global economies. domestic growth. The domestic pharmaceutical market (IPM) grew 21.9 per cent to record sales of Rs 5,369 crore (US$ 1.01 billion) in March 2012, as compared to the previous year, according to an analysis by a market research firm. Amongst the export markets, India is likely to push Japan for further opening of the pharmaceutical sector. This would help the domestic industry to leverage Comprehensive Economic Partnership Agreement (CEPA) and increase its share in the Japanese market. Indian pharmaceutical industry would gain significantly from the pact as Japan, the world's second largest market, had agreed to cut duties on imports of Indian generic drugs. India has also looked into joint ventures (JV) with Russian pharmaceutical companies to manufacture 500 drugs in Russia and to supply them in markets of Russia, Belarus and Kazakhstan. The growth will also be driven by the largest number of merger and acquisitions (M&A) in the pharmaceutical and healthcare sector. The drugs and pharmaceuticals sector has attracted foreign direct investments (FDI) worth US$ 9,173.50 million between April 2000 to February 2012, according to the latest data published by Department of Industrial Policy and Promotion (DIPP). India tops the world in exporting generic medicines worth US$ 11 billion. The Generics will continue to dominate the market while patent-protected products are likely to constitute 10 per cent of the pie till 2015, according to McKinsey report 'India Pharma 2015 - Unlocking the potential of Indian Pharmaceuticals market'. Indian generics constitute nearly a fifth of global supplies, as per a press release dated December 28, 2011. India has world renowned capacity in producing low cost, high quality bulk and generic drugs.

The Pharma Industry


The Indian Pharmaceutical space is gaining its position across the globe, as per a report by PWC, the pharma market in India is likely to cross USD 70 billion in sales by 2020(current size of USD 11 billion). The country is is likely to bank on the opportunity of

The Ministry of Commerce has proposed an ambitious Strategy Plan to double pharmaceutical exports from US$ 10.4 billion in 2009-10 to US$ 25 billion by 2013-14. The Government has also planned a 'Pharma India' brand promotion action plan spanning over a three-year period to give an impetus to generic exports Key Drivers to Indian Growth Competent workforce: India has a pool of personnel with high managerial and technical competence. It has an educated work force fluent in English. Professional services are easily available. Cost-effective chemical synthesis: Its track record of development, particularly in the area of improved cost-beneficial chemical synthesis for various drug molecules is excellent. It provides a wide variety of bulk drugs and exports sophisticated bulk drugs. Legal & Financial Framework: India has an old democracy and hence has a solid legal framework and strong financial markets. There is already an established international industry and business community. Consolidation: The international pharmaceutical industry is finding great opportunities in India. The process of consolidation, which has become a generalized phenomenon in the world pharmaceutical industry, has started taking place in India.

Indian pharma industry in the 1990s, when the rising healthcare costs in many developed countries forced them to seek the cheaper generic drug option. Thus, the Indian pharma industry was able to exploit the enormous generic opportunity that was spawned.
In the near-term, the generic opportunity will continue to lure

more companies. And, with competition intensifying, generic drugs will see greater price erosion.
For sustaining growth, Indian drug-makers will look at newer

avenues such as entering niche segments, building relationships with global pharma for joint research and development and widening distribution networks through marketing alliances. Other potential thrust areas include biopharmaceuticals, contract research and manufacturing, and new drug research.
The low cost of manufacturing renders India as an attractive

destination for contract research, and the availability of a large patents pool makes it appealing for clinical trials, which contributes the most, in terms of revenue, to the contract research segment. An increased presence in contract research will also help them build expertise to move up the value chain and engage in new drug development.
Indian industry's R&D capabilities currently lie in reverse

engineering drugs and in process chemistry


The high-risk high-return field of new drug research holds

Industry classification
Indian Pharmaceutical Industry
Active Pharmaceutical Ingredients(API) Contract Research And Manufacturing Service (CRAMS)

tremendous potential for Indian players.

Company perspective
Biosimilars

Formulations

Market Size USD 4.8 Bio

Market Size USD 2.5 Bio

Market Size USD 2.3 Bio

Market Size USD 200 mio

Established in 1996, Parabolic Drugs started its operations in 1998 as a small manufacturer producing for few of the clients in the region. From being a pharmaceutical ancillary in the initial years to a leading pharmaceutical company in 2012, Parabolic has emerged as a preferred partner and supplier to global innovators and generic companies in the antibiotic and nonantibiotic segments. Over the years, the company has strengthened its competitive position in the antibiotics and non-antibiotic APIs, Research and Development, and CRAMS space. It has registered a five year CAGR of over 35% while establishing a basket of over 50 APIs and various intermediates being serviced to about 800 customers. The company has also created a pipeline of 20 generic drugs across the niche therapies. In the year 2011, the company has stepped up in the value chain by foraying into the formulations segment. The Company has a clear vision to be a fully integrated Pharmaceutical Company

Way forward
The Indian pharmaceutical industry's emergence on the global landscape as a strong generics player is largely due to the Indian Patents Act-1970, which allowed only process patents in pharmaceutical space. The process patent regime has since then enabled pharmaceutical companies to keep the cost of medicines at affordable levels, therefore resulting in further cost reduction by reverse engineering. Although India shifted to the product patent regime in 2005, the capabilities developed during the past two decades became a competitive advantage for the

Parabolic Drugs Limited | Annual Report 2011-12

25

providing world class pharmaceutical products and services, from development of API intermediates to API contract manufacture to supplying finished formulations, for both generic and Innovator companies across the globe. The company is going ahead with the vision of being a fully integrated pharma company having backward and forward integration, world class infrastructure, R&D strengths, diversified product basket across different therapeutic segments and Intellectual Property Rights in the form of DMFs, and Patents for novel processes. Parabolic continues to build on its strengths and is fundamentally prepared for the challenges from the changing business and global economics.

2.

To develop products and chemistry for the new molecules as identified by marketing. This includes the evaluation of patents, synthetic route study through non-infringement process before starting development work. To enable the company in sustaining the cost competitiveness in market by continuous improvement in the existing processes. To provide quality documentation to Quality assurance, Regulatory affairs for filing DMFs in the regulated space Process validation activities jointly by Cross functional teams. Writing of validation protocols as per regulatory and GMP guidelines

3.

4. 5. 6.

Business Model
Finished Dosage Formulations Research and Development Active Pharmaceutical Ingredients

Contract research and Manufacturing services at R&D


Business Model
PDL offers Contract Research and manufacturing Services (CRAMS) in India and services to Global science Industry. With complete integrated R&D infrastructure, Parabolic (PDL) positions itself as one of the most competitive players. In CRAMS, PDL has the capability to provide integrated solutions ranging from route selection, process development, and optimization to manufacturing. Its expertise also involves providing Engineering solutions for manufacturing at multi ton scale.

Research and Development


The Research and development wing performs anessential role in the sustained growth of the company. Backed by world class infrastructure and equipped with all modern facilities the R&D team comprises a strength of around 75 qualified Ph.D and M.Sc scientists. Their activities range in development of cost efficient non infringing synthetic process, analytical testing, and optimization with quality documentation. Since R&D is considered as the mainstay for the organization, therefore a significant focus of the management rests on it. In today's competitive Pharma industry world, the research and development wing has the following focal points for its operation: 1. To bring in efficiencies in the process chemistry by a. b. c. d. Optimization of reaction parameters and methodologies Optimization by backward integration of the key intermediates Optimization by recoveries and recycling Down steam processing by products and green chemistries

Key achievements in FY 12
Successful execution of about 35 projects till date Alliance with top generic and innovator companies in Europe, US and Japan. Successfully completed the EHS and CGMP audit by innovator companies from US and Japan.

Intellectual Property Research (IPR)


PDL is fully equipped to encounter the challenges of patent infringements in Pharmaceutical Industry. PDL has a wellqualified and experienced team to facilitate the development of intellectual wealth and support to identify new potential markets for API & formulations across the globe. So far, the Company has filed has twenty four Process patents.

IPR Vision of the company


To

ensure non-infringing process for the future Grid molecules in different

Therapeutic areas IP Generation by filing new process, new

Complies with all GMP requirements and has complete utility

polymorphic form of different molecules


Trace out business potential/market for the Grid molecules

support with ETP , an in-house liquid nitrogen tank, and a GMP compliant water systems and chillers
Regulated Approvals: WHO GMP , USFDA for 6-APA

IPR Capabilities
Patent analysis via prior art search Technology assessment Patentability assessment Patent application drafting and filing Licensing support IP overlap analysis Competitor analysis and IP monitoring

R&D Centre at Barwala(PDL III)


Equipped with specialized laboratories of International

standard following cGLP


Six chemical research lab, each lab having 12 fuming hood Dedicated Analytical lab with instruments like HPLC, Prep.

HPLC, XRD, GC with Head space, GC, LC-MS, IR Spectrophotometer, UV-Visible Spectrophotometer, Polarimeter, Auto Titrator and Lypholizer Non- Antibiotic Facility at Chachrauli(PDL IV)
Pilot plant commissioned for manufacturing non-antibiotic

Active Pharmaceutical Ingredients


The Active Pharmaceutical Ingredients manufacturing division for the company plays the fundamental role in the revenues. The company drives its API business through its large scale manufacturing facilities dedicated for different verticals and covering therapeutic segments. Besides, the in-houselocation, the company also has strategic alliances with different world class facilities for catering to the demand of its customers. Over the years, the company has invested in shaping a world class infrastructure that enables it to produce best in category products with superior quality and excellence. The company today operates out of four in-house locations that comply with international regulatory standards and are duly approved by International regulatory agencies.

APIs in the new therapies such as CVS, CNS, oncology, antithrombotic, anti-diabetic and pain management.
Includes QA/QC block, pilot plant, manufacturing plant with

five production streams, separate finished goods processing section, solvent recovery, utilities, effluent treatment plant, canteen, stores, warehouses, hazardous reaction block and engineering and project sections.

Segments
Antibiotics-Cephalosporin Parabolic started as a contract manufacturer in the Penicillin space in 1998 and it has journeyed as a leading antibiotic manufacturer now. The company in the antibiotic segment has created a presence in over 50 countries. In the Antibiotics, the company banks on the following strengths:
Two large scale cGMP compliant API manufacturing facilities Plants audited and approved by leading MNCs and

Manufacturing Facilities for APIs


Cephalosporin Facility at Derabassi(PDL I) A 27 acre site with nine manufacturing plants that enables it to

produce wide range of latest generation cephalosporin APIs and intermediates.


A dedicated quality control and quality assurance unit,

Solvent recovery units, three R&D laboratories, a pilot plant for scale-up of new technologies developed by our in-house R&D, three boilers and utilities, two warehouses and in house healthcare centre
Regulated Approvals: EU GMP , WHO GMP , Japanese PMDA,

regulators including EUGMP , KFDA, Japanese PMDA and WHO


Strong Quality Management systems with Incoming/

Outgoing quality controls


Presence in over 50 countries including the regulated

markets of Europe, Japan and Korea


In-house research and development capabilities for

Korean FDA, OHSAS 18001-2004, ISO 14001-2004 Penicillin Facility at Panchkula(PDL II)
Two dedicated blocks for the manufacturing of wide range of

sustaining market leadership by means of cost, quality and optimization


Experience and strength to partner

oral penicillin products including niche penicillin APIs such as Bacampicillin, Sultamycillin and Pivampicillin

the leading innovator and generic companies across the globe

Parabolic Drugs Limited | Annual Report 2011-12

27

In house sterile manufacturing plant built to International

Therapies being worked into a. b. c. d. e. f. g. h. i. j. Anti-Thrombotic Anti-Osteoporotic Anti-Diabetic Anti-Hypertensive Neuro-Muscular Blocking Agent Antineoplastic Analgesic Treatment of Hyperuricemia & chronic gout Muscle Relaxant (Skeletal) Chelating Agent (iron)

cGMP specifications and conforming to USFDA standards. The entire operations are in closed condition without human intervention using manufacturing line of BADO from OMCA, Italy.
Filed over 39 Drug Master files across Europe, Japan, USA,

Canada, Japan and Korea


World class EHS management system driving EHS practices

Key Achievements in FY 12
Commissioning of multi-purpose block 3 with 120 TPA

capacity and Spray dryer for augmenting Amorphous in September 2011


Commissioning of New Sterile facility in March 2012 with fully

automated International BADO machinery for World class quality and compliance. Adds 120TPA capacity to Sterile basket
Audit from the Japanese companies for inspection from the

Herbal Nutraceuticals
Parabolic has been successful in launching its Herbal nutraceutical molecules across different markets in the globe. PDL has a Long term Strategic Tie up with Herbal API Manufacturer for the sales and marketing of herbal Nutraceuticals Key Herbal APIs offered are: Reserpine Used in Antihypertension, treatment of insanity 10 DAB III It is a precursor of Paclitaxel and Docetaxel, which is used for cancer treatment Raubasine Used for treatment of high blood pressure and Cerebral Hypoxia Youhmbine Used as both an over the counter dietary supplement in herbal extract. Colchicine An Anticancer natural product Thiocolchicoside Used as Anti- inflammatory muscle relaxant Calcium Sennoside Used in the treatment of constipation, working through a stimulation of intestinal peristalsis.

Japanese regulators for PMDA


Successful Approval from Korean Food and Drugs

Authority(KFDA) on Cephalosporin
Audit and visit from the European customers for EUGMP

approval of the new Sterile facility


Supply to Large Indian customers for their Finished Dosage

requirement , thereby enabling a trigger for USFDA inspectionFiling of 7 drug master files across EU, US and Japan. The total filings till date are 43 Antibiotics- Penicillins In the penicillin space, the company has successfully cleared audit and inspection from the European regulator which has a potential business in FY 13. The company is in negotiations with different customers in EU for regulatory business in Penicillin segment. Non-Antibiotics (Life Style Drugs) In December, 2011, the company successfully initiated the production in its green field project for the life style drugs and non-antibiotics. With a pipeline of over 17 new drugs in different therapeutic segments, the company is expecting sales in FY 13. The Lalru facility is spread across 27 acres and includes QA/QC block, pilot plant, manufacturing plant with different production streams, separate finished goods processing section, solvent recovery, utilities, effluent treatment plant, canteen, stores, warehouses, hazardous reaction block and engineering and project sections.

Quality Control and Quality Assurance


At Parabolic Drugs, Quality is not just a compliance rather it is a habit. Quality at Parabolic is an integrative philosophy of management for continuously improving the quality of products and processes. It functions on the premise that the quality of products and processes is the responsibility of everyone who is involved with the work at Parabolic. It is believed that the involvement of management, workforce, suppliers, and customers, shall enable the company to meet or exceed customer expectations. Quality Unit of Parabolic includes Quality Assurance and Quality Control empowered with independent decision making authority. A dedicated Quality Control and Quality Assurance department exists at PDL for all its facilities. PDL is proud to have its infrastructure created in line with the stringent quality guidelines and GMP framework. It is committed to compliance standards and is focused to meet the norms set by different pharmacopeia, and stringent specifications of clients. There are over twenty different MNCs and large formulators that have approved the facilities of PDL.

Major initiatives
The company organized several free health checkups for the

villages across its different locations. Over the years, this has been a regular practice for the company as an initiative towards society
Towards the noble cause, the employees of the company

take initiative in the form of blood donation.


Towards the greener environment, employees at PDL have

taken the ownership of creating green belts across different regions


Sponsoring major initiatives and social events to foster

India's rich culture and heritage

Human Resource and Intellectual Wealth


At Parabolic, it is believed that the future source of sustainable competitive advantage is largely through investment in the people, through the investment in building their capabilities. The Company emphasizes on continued qualitative growth of its human resources by providing a congenial and conducive work environment in consonance with its belief that the real strength of its organisation lies in its employees. HR Vision To achieve organizational excellence by implementing HR Practices that align Human Capital with Corporate Vision and improve their satisfaction level and have positive impact on overall business performance. HR Mission To create a value based organization by inculcating a culture of learning, creativity & team work and aligning the aspirations of our people with the business priorities which will ultimately lead to the development of an empowered, responsive and competent human capital. HR Goals 1. To formulate and implement sound HR Practices and Systems. 2. To foster an extremely open, congenial, innovative and enthusiastic work culture. 3. To develop and sustain core values and work ethics 4. To re-orient attitude of employees to cope with the changes required to establish an ethos of Quality and High Performance.

Environment Health and Safety


PDL engages & encourages its employees to adopt & comply with safety standards, safe practices and safe procedures on the job to prevent occupational health & safety related problems. At PDL: We strongly believe that working safely is a way of life
All our business decisions have inherent consideration for

safety
We believe that all our employees shall have an attitude of

responsibility and be willing to work as a team for the benefit of Safety of self and of their co workers.

Corporate Social Responsibility


Parabolic Drugs considers the interests of society by taking responsibility for the impact of its activities on customers, employees, shareholders, communities and the environment in all aspects of its operations. Its contribution to the community are in the areas of health, education, improving village infrastructure, environment (effluent treatment, tree plantation, treatment of hazardous waste), and miscellaneous activities such as contribution to other social development organisations. The employees and management of Parabolic also participates in the welfare programmes, both at the personal and professional level.

Parabolic Drugs Limited | Annual Report 2011-12

29

5. To enhance productivity of human resources by developing efficient and effective systems of manpower planning, succession planning, selection, placement, training & Development and effective performance management system. During the period under review, there was no incident of work stoppage or loss of production due to IR related issues

business. The company shall continue to build growth momentum through its partner in the strategic alliances
The commissioning of new sterile and amorphous facility

Formulations
FY 12 marks the presence of Parabolic in the formulations space. The company has a vision of being a vertically integrated pharmaceutical company. The strategic initiatives are driven by two divisions across the different verticals: 1. Nuclues- A division of Parabolic Drugs for the domestic formulations space 2. International Formulations Division Developments in NUCLEUS FY 12 marks the presence of Parabolic in the formulations space. The company's under its division NUCLEUS has ensured a PAN India presence with about 500 Stockiest, 20 distributors and wide basket of 170 products in different dosage form. The company clocked a topline of about 8 Cr in FY 12. Going forward, FY 13 will further cement Nucleus's presence in the domestic market. Developments in the International Formulations Meanwhile, the company's own plants get commissioned; it has identified and finalized different WHO GMP approved manufacturing sites to initiate the business. The focus is on the therapeutic segments where PDL has backward integration. Developments in FY 12: a) Registration of about 50 brands in India and Internationally b) Submission of about 80 dossiers for registration (FY 13 target of 150) c) Contracts finalized with key distributors in APAC d) Loan License agreements with six WHO GMP approved manufacturing sites

completes the API expansion that was started some years back. With over 1000 Tons annual capacity, backed by the international regulatory approvals, the company looks to build its turnover on exports, preferably the regulated exports. FY 13 may also bring some achievements to the company with the approvals from Japanese PMDA and the USFDA
With a foothold in over 50 countries, the company looks to

develop its market presence and strengthen its revenues from the markets of Japan, Korea, China, CIS and the European markets
With over 20 molecules to be launched in the life style space,

the non-antibiotic facility at Lalru is likely to contribute and add value to the topline and bottomline. This adds to the
The company would continue its research on identified life

style therapies as to expand its basket of products in the new segments.


The custom synthesis, contract research activity based on

literature search, novel route scouting, Small scale synthesis, characterization of molecules to drive the revenues for CRAMS
Developments in the process R&D projects related to route

selection and optimization, method Development and Validation and synthesis of GMP /Non GMP material
Catering to innovators needs of large scale contract

manufacturing
PDL shall continue to explore new opportunities in the off-

patent pharmaceutical regime through its ambitious filing plans.


In the formulations space, the company looks to add

revenues from the formulations out of its three pronged strategy of domestic formulations, International formulations and branded generics(Ziven Life Science)

Risk and its Management


The pharmaceutical industry is exposed to various factors that may risk the normalcy of business operations. The micro and macro-economic variables bring various operating challenges that directly or indirectly affect our pharmaceutical industry. To eliminate a significantimpact of these factors, a proactive approach to risk identification and management holds the key to the sustainability.

Business outlook for FY 13


The company shall drive its topline and bottom-line thorough

its sustainable business model comprising of the active pharmaceuticals, contract research and finished dosage

Your company is distinctively placed for risk management and has set in place key risk management policies. The managementadministers these policies and ensures that the operations combat the potential threats and the risk is minimized. Within the pharmaceutical space, there are certain risks which are natural and each company is exposed to it. Some of them are: Slowdown in the world economy Risk: Slowdown in the economy Impact: The world is experiencing an economic slowdown since the financial crisis of 2008-2009. Furthermore the prevailing debt crisis across the EuropeanUnion has exposed the world to another wave of slowdown. Parabolic Drugs, being a pharmaceutical exporting company is exposed to this risk Mitigation Strategy: The Companyhas a basket of diversified products, and after the launch of its non-antibiotic range of products, the company's product acceptance is wide, and it can further expand its presence across new territories. Further, the company has also received regulatory approvals from the Asian pharmaceutical giants like Japan and Korea, this would derisk the company's standalone reliance on the European markets Volatility in the Indian Currency Risk: The Indian currency against the US Dollar has depreciated by about 14% in FY 11-12 Impact: The sharp changes in the valuation of the rupee vis-a-vis the dollar in the recent times, superimposed on an overall negative trend of depreciation, negatively impacts the earnings of the company. A year ago the rupee stood at a strong 44.50 to a dollar, followed by showing signs of weakness and sliding to a low of 54/US$. The company is a net importer and a further fall in Indian Currency will affect the margins and profitability Mitigation Strategy: The Company has a well-structuredpolicy to review and mitigate the exchange rate risk. Although the company uses appropriate hedging tools to diminish the impact of currency risk, in the long term the company looks to expand the size of exports as to build a natural hedge to set off the impact. Erosion of the selling prices Risk:There has been a substantial fall in the prices of antibiotic range of molecules. With the increasing pressure of governments across the world to reduce the health care cost, the world is moving towards economical alternatives to the branded products. The Genericization, along with an opportunity to

launch new drugs, also adds to the pressure of falling prices in old APIs Impact: Parabolic Drugs has larges capacities in the antibiotic space, and it has the major reliance on the antibiotic APIs Mitigation Strategy: As a long term strategy to diversify and mitigate the individual risk of antibiotics, the company has forayed into non antibiotic range of molecules. These molecules will not only derisk the reliance of the company on antibiotics, it will also give an impetus to the margins Competitive pressure Risk: Increasing competition in the pharmaceutical Space Impact: In 2012-13, CRISIL research expects the pharmaceutical industry to grow by 16-18 per cent y-o-y to $36- 37 billion. Such bright industry prospects would encourage huge competition not only on the domestic front but also from multinational companies.Competitive pressure in the domestic market is likely to be sustained as MNCs become more aggressive and domestic companies leverage on their expanded field force. Potential regulatory interventions could further put pressure or hurt pricing. Mitigation Strategy: PDL has uniquely positioned itself in the market with introduction of new and improved molecules, expansion of the production capacity meeting international standards and improving the existing product range, thereby having an edge over the competitors. Human resource management Risk: High attrition rate in the pharmaceutical space Impact: Enhancing productivity, quality and reliability is a result of highly motivated and professional workforce. Since the attrition rate in this industry is very high, retaining the pool of talent is a major challenge. Mitigation Strategy: PDL has always nurtured a policy to promote a vibrant work culture based on innovation and capability building and performance measurement. HR has always emphasized on talent attraction, retention and staff welfare. At PDL, the individual rewards on performance are aligned to the organization and business unit performance.

Review of Financial Performance


Owing to thevolatile global economic environment, the year 2011-12 has been challenging for the company. The company has accomplished the gross turnover of INR 10123.08 million (a growth of 49.91%) for the year 2011-12. However due to the high

Parabolic Drugs Limited | Annual Report 2011-12

31

interest rates, the depreciated Indian rupee, the company recorded the net profits of INR 512.12 million, short by 150 bps over previous year. The size of the balance sheet has gone up to INR 13143.77 million Sales and Revenue The revenue figures for the FY '12 stands at INR 10,123.08 million as against INR 6,752.97 million in the FY'11 which accounts for a robust 49.9% growth over the previous year . The growth has largely been achieved by the :
Enhanced production capacity in Antibiotic APIs Introduction of new molecules in the key regulated and non-

481.59 million against INR 398.06 million in FY'11. The reason owing to the 20.98% increase has been a result of increased expenses on manufacturing due to increase power cost, consumables and spares,rise in general administration expenses resulting from new plant. The financial cost of the company has risen significantly to INR 641.37 million in FY'12 from INR 407.60 million in FY'11, showing a 57% increase. The increase in base rate by the respective banks has raised the financial cost of the company. The EBIDTA margins for the company stand at INR 1,614.32 million in the FY'12 as compared to INR 1,271.45 million in the FY'11 thereby showing an increase of 26.9%. Profit after tax (PAT) stood at Rs. 512.11 million, which is marginally (1.5%) less than the previous year of Rs 520.24 million. Balance Sheet The size of the balance sheet has grown to INR 13,143.77 million in FY'12 from INR 10,672.51 million in FY'11 recording a 23.15% growth. The capital employed in the business is Rs. 8,018.32 million in FY'12 Reserves and surplus have registered a growth of 15.5% from Rs.3,171.08 million in FY'11 to Rs.3,665.21 million in FY'12. The long term and short term borrowings of the company has increased from Rs. 4,513.64 million to Rs. 5,223.88 million in FY'12 which accounts for a 16% increase. Gross block of the company increased to Rs. 3,787.46 million in FY'12 from Rs. 2,808.8 million in FY'11 registering a 34% increase. Investments registered a decrease of 37% from Rs. 56.73 million in FY'11 to Rs. 35.66 million in FY'12.

regulated markets.
Entering new vertical space- Herbal APIs and the domestic

formulation
Launch of 4th generation molecules in Turkey.

Cost and expenses The operational cost of business for the FY'12 stands at INR 7,669.9 million, against the INR 5,080.43 million for FY 11, thereby an increase of 50.96%. Material cost for FY'12 has been INR 6,963.15 million, whereas the same for FY'11 was INR 4,513.07 million thereby showing 54.28% increase over the previous year. Due to volatility in the Indian Rupee, the cost of imported raw material has significantly gone up leading to inflated material cost. Personnel expenses for the FY'12 has increased to INR 641.37 million from INR 407.60 million in FY'11 showing an overall increase of 57.35%. With the commissioning of the new plant at Lalru, in addition to the new sterile and amorphous facility, investments in Human resource has significantly gone up. The remaining expenses including Administration expenses, selling and distribution expenses for the FY'12 stand at INR

Report on

Corporate Governance

1. Company's Philosophy on Code of Corporate Governance:


This report on Corporate Governance forms part of the Annual Report. Corporate Governance refers to a combination of laws, regulation, procedures, implicit rule and good corporate practices that ensure that a Company meets its obligations to optimize shareholders' value and fulfill its responsibilities to the community, customers, employees, Government and other segments of society. Parabolic Drugs Limited (Parabolic) is committed on adopting the best practices of Corporate Governance as manifested in the Company's functioning to achieve the business excellence by enhancing long-term shareholders' value. Parabolic is committed to achieve the best standard of Corporate Governance through complete transparency in its dealings with the management, associate companies and other third parties. The Management of Parabolic understands its accountability and responsibility towards its shareholders/investors, regulatory authorities and also for other sections of the Society.

2. Board of Directors:
a) Board Meetings: During the financial year 2011-12, the Board met 4 times on the following dates: - 13th May, 2011 - 12th November, 2011 b) Composition as on 31st March, 2012: The Board of Directors comprises of a Non- Executive Chairman, a Managing Director, two Executive/Whole Time Directors and 5 Non - Executive Directors. Out of the total strength of 9 directors, 5 directors are Independent, thus it meets the stipulated requirement. The composition of the Board of Directors and their attendance at the Board Meetings during the year and at last Annual General Meeting of the Company as also the number of other Directorship in Indian Public Limited Companies. - 13th August, 2011 - 11th February, 2012

Parabolic Drugs Limited | Annual Report 2011-12

33

Name of the Director

Designation & Category

No of Board meetings attended

Attendance at last AGM

Total no. of Directorship in other companies Nil

No. of committee memberships in other companies Nil

Total no. of Board chairmanship in other companies Nil

Total no. of committee chairmanship in other companies Nil

Inder Bir Singh Passi

Chairman, Non Executive & Independent Director Managing Director Whole Time Director Executive Director Non Executive Independent Director Non Executive Non Independent Director Non Executive Independent Director

Yes

Pranav Gupta Vineet Gupta Gurpreet Singh Sandhu Dr. Ram Kumar

4 2 4 4

Yes Yes No Yes

2 2 Nil Nil

Nil Nil Nil Nil

2 Nil Nil Nil

Nil Nil Nil Nil

Koppisetty Srinivas Arun Mathur

No

Nil

Nil

Yes

Nil

Nil

Nil

Nil

Pardeep Diwan* Non Executive Independent Director Nikhil Goel Non Executive Independent Director Non Executive Independent Director

No

Nil

Nil

Nil

Nil

No

Nil

Nil

Nil

Nil

Manmohan Lal Sarin**

No

Nil

Nil

Nil

Nil

* Mr. Pardeep Diwan retired by rotation from the Directorship of the Company w.e.f. 29th September, 2011 **Mr. Manmohan Lal Sarin was appointed as a Director of the Company liable to retire by rotation w.e.f. 29th September, 2011. Disclosure of Change Mr. Pardeep Diwan retired by rotation from the Directorship of the Company w.e.f. 29th September, 2011 and Mr. Manmohan Lal Sarin was appointed as a Director of the Company w.e.f. 29th September, 2011 in his place.

3. Audit Committee:
As at 31st March, 2012, the Audit Committee comprised of Four Directors namely Mr. Nikhil Goel, Mr. Inder Bir Singh Passi, Mr. Pranav Gupta and Mr. Arun Mathur. Mr. Nikhil Goel is the Chairman of the Audit Committee. The Company Secretary is the secretary of Audit Committee. The terms of reference of the Audit Committee are, as contained in Corporate Governance Clause of the Listing Agreement. The Audit Committee met five times during the financial year 2011-12 on the following dates: - 13th May, 2011 - 12th August, 2011 - 11th February, 2012 - 15th June, 2011 - 12th November, 2011

The attendance of the members of the Audit Committee during the financial year 2011-12 is given below: Sr. No. Name of the Director Designation Executive/ Non Executive/ Promoter Independent/ Non Independent No. of Audit Committee Meetings Attended 3 2 4 5 2

1. 2. 3. 4. 5.

Pardeep Diwan* Nikhil Goel** Inder Bir Singh Passi Pranav Gupta Arun Mathur***

Chairman Chairman Member Member Member

Non Executive Non Executive Non Executive Executive & Promoter Non Executive

Independent Independent Independent Non Independent Independent

* Mr. Pardeep Diwan retired by rotation from the Directorship of the Company w.e.f. 29th September, 2011. ** Mr. Nikhil Goel was appointed as a Member and Chairman of the Audit Company w.e.f. 30th September, 2011. *** Mr. Arun Mathur was appointed as a Member of the Audit Company w.e.f. 30th September, 2011.

4. Remuneration Committee
The remuneration Committee was constituted by our Directors pursuant to a Board Resolution dated 13th May, 2011 and comprises of three Directors namely Mr. Inder Bir Singh Passi, Dr. Ram Kumar and Mr. Arun Mathur. a) Sr. No. 1. 2. 3. b) Composition: The Remuneration Committee of the Company comprises of three Directors as per details given below: Name of the Director Inder Bir Singh Passi Dr. Ram Kumar Arun Mathur Terms of Reference: a) Reviewing, assessing and recommending the appointment of Executive/Non-Executive Directors and Senior employees; b) c) d) Reviewing the remuneration packages of Executive/Non Executive Directors and senior employees; Recommending the payment of compensation in accordance with the provisions of the Companies Act,1956 and Carrying out any other function in the Equity Listing Agreement as and when amended from time to time. Designation Chairman Member Member Executive/ Non Executive/ Promoter Non Executive Non-Executive Non Executive Independent/ Non Independent Independent Independent Independent

One meeting of Remuneration Committee was held during the financial year 2011-12 c) Detail of Remuneration paid to the Executive Directors for the Financial Year 2011-12: The details of the remuneration paid to the Managing Director and Executive Directors/Whole Time Director for the Financial Year 2011-12 is as under: Particulars Salary, Allowances & perquisites Bonus/Performance Incentive Retirement Benefits Stock options Tenure Notice Period & Severance Pay Number of shares held Pranav Gupta Rs. 96,00,000 5 years 824100 Vineet Gupta Rs. 84,00,000 5 years 701550 Gurpreet Singh Sandhu NIL 2 years 11500

Parabolic Drugs Limited | Annual Report 2011-12

35

d)

Details of Remuneration paid to the Non-Executive Directors for the Financial Year 2011-12: Non-Executive Directors are not entitled to any remuneration except sitting fees for the Board and Committee Meetings. The details of the sitting fees paid to the Non-Executive Directors for the Financial Year 2011-12 is as follows:

S. No. 1. 2. 3. 4. 5. 6. 7.

Name of the Director Mr. Inder Bir Singh Passi Dr. Ram Kumar Mr. Pardeep Diwan* Mr. Arun Kumar Mathur Mr. Koppisetty Srinivas Mr. Nikhil Goel Mr. Manmohan Lal Sarin*

Sitting Fee (in Rs.) 18500 29500 7000 20500 15000 18000 5000

*Mr. Pardeep Diwan retired by rotation from the Directorship of the Company w.e.f. 29th September, 2011 and Mr. Manmohan Lal Sarin was appointed as a Director of the Company w.e.f. 29th September, 2011 in his place.

5. Shareholders'/ Investors' Grievance Committee:


The Shareholders' / Investors' Grievance Committee was reconstituted by the Board of Directors on 13th May, 2011. a. Composition: The Shareholders'/ Investors' Grievance Committee of the Company comprises of three Directors as per details given below: S. No. 1. 2. 3. Name of the Director Inder Bir Singh Passi Dr. Ram Kumar Mr. Nikhil Goel Designation Chairman Member Member Executive/ Non Executive/ Promoter Non Executive Non Executive Non Executive Independent/ Non Independent Independent Independent Independent

No Shareholders'/ Investors' Grievance Committee was held during the Year 2011-12 The Company Secretary is the Compliance Officer of the Shareholders'/Investors' Grievance Committee. Details of investors' complaints during the financial year 2011-12: Received 10 Resolved 10 Pending 0

6. General Body Meetings:


The details of General Body Meetings held during the last three financial years are given as below: Nature of Meeting Day, Date and time of AGM Venue Number of Special Resolutions Whether any special resolution passed last year through postal ballot No

15th Annual General Meeting for the financial year ended 31st March, 2011

Thursday 29th September, 2011 3.00 P .M.

PHD House, Sector 31 A, Chandigarh

Nature of Meeting

Day, Date and time of AGM

Venue

Number of Special Resolutions

Whether any special resolution passed last year through postal ballot No

14th Annual General Meeting for the financial year ended 31st March, 2010 13th Annual General Meeting for the financial year ended 31st March, 2009

Tuesday 28th September, 2010 3.00 P .M. Saturday 26th September, 2009 3.30 P .M.

PHD House, Sector 31 A, Chandigarh S.C.O. 99-100, Top Floor, Sector 17 B, Chandigarh

No

The Company has not passed any resolution through postal ballot during the Financial Year 2011-12. No resolution is proposed to be passed by postal ballot in the forthcoming Annual General Meeting.

7. Disclosures:
During the year, there was no material/significant transaction with related parties that may have potential conflict with the interests of Company at large. Also there has not been any non compliance by the Company in respect of which penalties or strictures were imposed by the Stock Exchanges, the Securities and Exchange Board of India or any other Statutory Authority on any matter related to Capital Markets during the last three years. The Company has not so far, adopted any non mandatory requirements as stated in Annexure III of the Listing Agreement except the Remuneration Committee and Whistle Blower Policy. As per the Whistle Blower Policy adopted by the Company, every personnel of the Company have access to the Audit Committee.

8. Means of Communication:
Presently, the Company communicates with the shareholders at large through its Annual Reports, publication of financial results, press releases in leading newspapers and by filing of various reports, informations and returns with the Statutory Bodies like Stock Exchanges, Reserve Bank of India and the Registrar of Companies. The informations are published in prominent daily newspapers viz. The Economic Times, Financial Express, Business Standard and Desh Sewak. The Investors' relating informations of the Company are also made available at the website i.e. www.parabolicdrugs.com.

9. General Shareholder Information:


i. AGM: 16th Annual General Meeting Date: 28th September, 2012 Time: 3.00 P .M. Venue: PHD House, Sector 31 A, Chandigarh ii. Financial Year (2012-13): (Tentative) First Quarter Results: August, 2012 Second Quarter Results: November, 2012 Third Quarter Results: February, 2013 Fourth Quarter and Annual Results: May, 2013 iii. iv. Date of Book Closure: 21st September, 2012 to 28th September, 2012 Dividend Payment Date: within 30 days from the date of AGM.

Parabolic Drugs Limited | Annual Report 2011-12

37

v.

Listing on Stock Exchanges: The Equity Shares of the Company are listed on the following two Stock Exchanges: The Bombay Stock Exchange Limited (BSE) Floor 25, Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai - 400 001 The National Stock Exchange of India Limited (NSE), Exchange Plaza, Bandra Kurla Complex, Bandra (East), Mumbai - 400 051 The Company has duly paid the listing fee to both the aforesaid Stock Exchanges for the financial year 2012-13.

vi.

Stock Code: BSE: 533211 NSE: PARABDRUGS

vii. Market Price Data: High, Low during each month in last financial year: Financial Year 11-12 Share Price of Parabolic Drugs Limited Highest (Rs.) Lowest (Rs.) Closing (Rs.) % age change over last month's closing -9.12 -5.55 -6.25 -29.9 23.19 22.06 -12.26 -10.95 10.03 -1.18 -13.40 BSE Sensex Highest (Rs.) Lowest (Rs.) Closing (Rs.) % age change over last month's closing -3.30 1.85 -3.44 -8.35 -1.34 7.60 -8.93 -4.15 11.25 3.25 -1.96

Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar

52.70 47.30 46.00 42.80 38.25 33.25 40.80 39.95 38.00 35.70 40.50 35.80

40.00 39.60 37.00 36.85 25.90 26.70 31.70 29.55 29.25 29.00 32.60 28.10

46.60 42.35 40.00 37.50 26.30 32.40 39.55 34.70 30.90 34.00 33.60 29.10

19811.14 19253.87 18873.39 19131.70 18440.07 17211.80 17908.13 17702.26 17003.71 17258.97 18523.78 18040.69

18976.19 17786.13 17314.38 18131.86 15765.53 15801.01 15745.43 15478.69 15135.86 15358.02 17061.55 16920.61

19135.96 18503.28 18845.87 18197.20 16676.75 16453.76 17705.01 16123.46 15454.92 17193.55 17752.68 17404.20

viii. Registrar and Share Transfer Agents:


M/s. Link Intime India Private Limited

C-13, Pannalal Silk Mills Compound, L.B.S Marg, Bhandup (West), Mumbai - 400 078 Tel: + (91 22) 2596 3828 Fax: + (91 22) 2594 6969 E-mail: mumbai@linkintime.co.in Website: www.linkintime.co.in ix. Share Transfer System:

A-40, 2nd Floor, Naraina Industrial Area, Phase-II, Near Batra Banquet Hall, New Delhi - 110 028 Tel: + (91 11) 4141 0592,93,94 Fax: + (91 11) 4141 0591 E-mail: delhi@linkintime.co.in Website: www.linkintime.co.in

The Company has constituted a Share Transfer Committee of its Directors. The Committee meets on an average once in a fortnight as per the requirement. The list of valid transfers and objections, if any, are placed before the Company for its approval/ Confirmation. Presently, the shares of the Company are traded on the Stock Exchanges compulsorily in demat form. The Company has participated as an issuer both with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). The Shareholders may operate through any of the depositories. The International Securities Identification Number (ISIN) is INE 618H01016. x. Distribution of shareholding as on 31st March, 2012: No. of shareholders 11861 1241 723 167 62 71 113 173 14411 % of shareholders 82.31 8.61 5.02 1.16 0.43 0.49 0.78 1.20 100.00 No. of shares 1895946 1003722 1010929 434115 221323 338178 833573 56154228 61892014 % of shareholding 3.06 1.62 1.63 0.70 0.36 0.55 1.35 90.73 100.00

No. of equity share held Up to 500 501-1000 1001-2000 2001-3000 3001-4000 4001-5000 5001-10000 10001 and above Total

Shareholding Pattern as on 31st March, 2012: Category Promoter & Promoter Group Public Shareholding Institutions Mutual Funds/ UTI/FIs/ Banks/ Central & State Government FVCF/FII Non Institutions - Individuals - Bodies Corporate 9520597 4288109 13816 285 15.39 6.93 2911672 6 4.70 No. of shares 24275327 No. of shareholders 16 % of shareholding 39.22

10133960

16.37

Parabolic Drugs Limited | Annual Report 2011-12

39

Category - NRIs - Foreign Company - Trust - Clearing Member Total

No. of shares 357885 7697727 2500050 206687 61892014

No. of shareholders 173 5 2 99 14411

% of shareholding 0.58 12.44 4.04 0.33 100.00

xi.

Dematerialization of shares and Liquidity: Presently, some of the Pre IPO shares are in physical mode and the entire PostIPO holding is in Demat form.

xii. Outstanding GDRs/ADRs/ Warrants or any Convertible instruments, conversion date and likely impact on equity: Not Applicable xiii. Plant Locations: The plants of the Company are located at the following locations: a) b) c) Parabolic Drugs Limited, Village: Sundhran, P .O.: Mubarakpur, Tehsil: Derabassi, District: Mohali, Punjab Parabolic Drugs Limited, Plot No. 45, Industrial Area, Phase II, Panchkula, Haryana Parabolic Drugs Limited, Plot No. 280-281, Phase I, Block 1, Alipur Industrial Estates, HSIIDC, Tehsil: Barwala, District: Panchkula, Haryana d) Parabolic Drugs Limited, Village: Chachrauli, Tehsil: Derabassi, District: Mohali, Punjab xv. Address for correspondence: Registered Office: Parabolic Drugs Limited, S.C.O. 99-100, Top Floor, Sector 17 B, Chandigarh - 160 017 Phone Nos: 0172-3914646-647 Fax No: 0172-3914645 Website: www.parabolicdrugs.com Corporate Office: Parabolic Drugs Limited, 9 AB, Second Floor, Taimoor Nagar, New Friends Colony, New Delhi - 110 065 Phone Nos: 011-65514789 Fax No: 011-26332660

10. Declaration Regarding Compliance With Code of Conduct:


The Company has adopted the Code of Conduct for all Board Members and Senior Management Personnel of the Company. The Code of Conduct was adopted by the Board and Confirmation taken from all Directors and Senior Management Personnel for compliance with the same.

Auditors' Certificate on Compliance of Corporate Governance under Corporate Governance Clause of the Listing Agreement(s)

The Members Parabolic Drugs Limited, S.C.O. 99-100, Top Floor, Sector 17 B, Chandigarh We have examined the compliance of conditions of Corporate Governance by M/s. Parabolic Drugs Limited ("the Company"), for the year ended 31st March, 2012, as stipulated in Clause 49 of the Listing Agreement of the said Company with Stock Exchanges. The Compliance of conditions of Corporate Governance is the responsibility of the Management. Our examination was limited to review the procedures and implementation thereof, adopted by the Company, for ensuring the compliance of the condition 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 and based on the representation made by the Directors and the Management, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement. We further state that such compliance is neither an assurance as the future viability of the Company nor the efficiency or effectiveness with which the Management has conducted the affairs of the Company. For S.K. Bansal & Co., Chartered Accountants

(S.K. Bansal) Place: Chandigarh Date: 14th August, 2012 Partner Membership No. 013147 FRN 002222N

Parabolic Drugs Limited | Annual Report 2011-12

41

Auditors Report
To The Shareholders We have audited the attached Balance Sheet of M/s. Parabolic Drugs Limited, Chandigarh as at 31st March 2012 and also the Statement of Profit & Loss 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. 1. We conducted our audit in accordance with auditing standards generally accepted in India. These 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. As required by the Companies (Auditor's Report) Order, 2003 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. Further to our comments in the Annexure referred to 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; FOR S.K. BANSAL & CO., Chartered Accountants (v) On the basis of written representations received from the Directors, as on 31st March 2012 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March 2012 from being appointed as a Director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956. (vi) Subject to Note 26(b) of financial statements regarding confirmation of Debit or Credit Balances. In our opinion and to the best of our information and according to the explanations given to us, the said accounts read with note 26 forming part of financial statement 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 Balance Sheet, of the state of affairs on the Company as at 31st March 2012; (b) in the case of Statement of Profit & Loss , of the Profit for the year ended on that date. (c) in case of Cash Flow Statement, of the cash flows for the year ended on that date.

2.

(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 those books. (iii) The Balance Sheet, Statement of Profit & Loss and Cash Flow Statement dealt with by this report are in agreement with the books of account. (iv) In our opinion, the Balance Sheet , Statement of Profit & Loss 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 to the extent applicable, Place : Chandigarh Dated : 14 August, 2012

(S.K. Bansal) Partner Membership No: 13147 FRN 002222N

Name : M/s. S.K. Bansal & Co. Chartered Accountants Address: Kothi No. 3193, Sector 28 D, Chandigarh-160002

Parabolic Drugs Ltd.

Annexure to the Auditors Report

Annexure referred to in Paragraph-2 of the Auditors' Report to the Shareholders of M/s. Parabolic Drugs Limited, Chandigarh on the accounts for the year ended 31st March 2012.
(i) (a) As confirmed by the management the Company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets. (b) We are informed that the company has framed programme of periodical physical verification of its fixed assets in phased manner, which in our opinion is reasonable having size of the company and nature of its business. In terms of such programme, during the year ended 31st March 2012, physical verification of the fixed assets was carried out by the management during the year and no material discrepancy was noticed on such verification. (c ) As confirmed by the management ,the substantial part of Fixed Assets have not been disposed off during the year. (ii) (a) According to the information & explanations given to us the inventories comprises of raw material, work in progress, material at shop floor and finished goods as on 31St March 2012 have been physically verified by the management. (b) The procedure of physical verification of inventory followed by the management is, in our opinion reasonable and adequate in relation to the size of the company and the nature of its business. (c) Quantitative records have been maintained for Raw Materials & Finished Goods produced. As confirmed by management no material discrepancies were noticed on physical verification. (iii) (a) The Company has not taken from/granted any (secured or unsecured) loans from companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956. (b) As Company has not taken from/granted loans apart from transactions on current account para iii(b), iii(c), iii(d) of the order is not applicable. (iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control procedures commensurate with the size of the (v) company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls. (a) According to the information and explanations given to us, the particulars of contracts or arrangements referred to in Section 301 of the act have been entered into the register required to be maintained under that section. (b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangement entered into the register in pursuance of section 301 of the Act and exceeding the value of Rupees Five Lacs in respect of any party during the year, have been made at prices, which are reasonable having regard to the prevailing market prices at the relevant time. (vi) In our opinion and according to information and explanation given to us, the Company has not accepted deposits from the public as per Companies (Acceptance of Deposits) Rule of 1975 and as per provisions of Section 58A and 58AA of the Companies Act, 1956.

(vii) In our opinion the Company has an Internal Audit System commensurate with its size and nature of its business. (viii) As confirmed by the management, the Company is maintaining cost records as prescribed by Central Government under section 209(1)(d) of the Companies Act 1956. (ix) (a) According to information and explanations given to us, the Company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education protection fund, employees' state insurance, income tax, sales tax, wealth tax, custom duty, excise duty, cess and other material statutory dues as applicable to it. . (b) According to the information and explanations given to us, there are no dues of sales tax, income tax, customs duty, wealth tax, excise duty and cess, which have not been deposited on account of any disputed except as

Parabolic Drugs Limited | Annual Report 2011-12

43

referred to in Para No. (x) and (y) of additional note 26 to financial statement as on 31st March 2012. (x) There are no accumulated losses of the Company at the end of the year. The company has not incurred cash losses during the year covered by our audit and the immediately preceding financial year. In our opinion and according to the information and explanations given to us and as confirmed by management, the company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that the no funds raised on short-term basis have been used for long-term investment. No longterm funds have been used to finance short-term assets. (xviii) According to the information and explanations given to us, the company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act. (xix) No debentures have been issued during the year by the company. (xx) During the year no money has been raised by public issue hence the requirement of paragraph 4(xx) is not applicable. (xxi) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

(xi)

(xii) 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 Companies (Auditor's Report) Order, 2003 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 are not applicable to the company. (xv) According to information and explanations given to us the company has not given any guarantee for loans taken by others from banks or financial institutions. (xvi) According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company and as confirmed by management , we report that the term loans were applied for the purpose for which the loans were obtained.

FOR S.K. BANSAL & CO., Chartered Accountants (S.K. Bansal) Partner Place : Chandigarh Dated : 14 August, 2012 Membership No: 13147 FRN 002222N

Name : M/s. S.K. Bansal & Co. Chartered Accountants Address: Kothi No. 3193, Sector 28 D, Chandigarh-160002

Parabolic Drugs Ltd.

Balance Sheet As at March 31, 2012


(` in million) Note I. EQUITY AND LIABILITIES (1) Shareholders' Funds (a) Share Capital (b) Reserves and Surplus (2) Non-Current Liabilities (a) Long-term borrowings (b) Deferred tax liabilities (Net) (c) Long term provisions (3) Current Liabilities (a) Short-term borrowings (b) Trade payables (c) Other current liabilities (d) Short-term provisions Total II. ASSETS (1) Non-current assets (a) Fixed assets (i) Tangible assets (ii) Intangible assets (iii) Capital work-in-progress (b) Non-current investments (c) Other non-current assets (2) Current assets (a) Inventories (b) Trade receivables (c) Cash and cash equivalents (d) Short-term loans and advances (e) Other current assets Total Significant Accounting Policies & Notes on Financial Statements Under reference to our report of even date. For S. K. Bansal & Co. Chartered Accountants S. K. Bansal Partner Membership No. 013147 FRN. 002222N Place : Chandigarh Dated : August 14, 2012 For and on behalf of the Board Vineet Gupta Whole Time Director Pranav Gupta Managing Director 26 13 14 15 16 17 4517.32 2217.56 346.20 464.31 173.43 13143.77 3406.48 2751.58 256.57 370.50 167.93 10672.51 11 12 10 1875.11 3.81 1872.88 35.66 1637.49 1627.57 1.96 1122.54 56.73 910.65 6 7 8 9 3764.55 2841.94 495.13 150.86 13143.77 3590.96 1773.78 303.54 172.97 10672.51 3 4 5 1459.33 116.94 30.88 922.68 97.53 21.05 1 2 618.92 3665.22 618.92 3171.08 As at 31.03.2012 As at 31.03.2011

The accompanying notes (No. 1 to 26) are an integral part of Financial Statements

Vipin Gupta V.P . & C. Secretary

R. C. Goyal Sr. V. P . (Finance)

Parabolic Drugs Limited | Annual Report 2011-12

45

Statement of Profit and Loss

For the year ended March 31, 2012 (` in million) Note As at 31.03.2012 As at 31.03.2011

REVENUE I. II. Revenue from Operations Other Income 18 19 9243.44 40.77 9284.21 6198.44 153.45 6351.89

III. Total Revenue (I +II) EXPENSES Cost of Materials consumed Changes in inventories of finished goods, work-in-progress and Stock-in-Trade Employee benefit expenses Finance costs Depreciation and amortization expense Other expenses IV. Total Expenses V. Profit before tax(III-IV) 22 23 24 25 20 21

8004.48 (1041.33)

5410.89 (897.82)

225.16 641.37 308.53 481.59 8619.80 664.41

169.30 407.60 177.03 398.07 5665.07 686.82

VI. Tax expense: (1) Current tax (including wealth tax) (2) Deferred tax Charge/ (Credit) (3) Tax Adjustment Earlier Years Total Tax Expenses VII. Profit for the period (V-VI) Weighted Average Number of Equity Shares Outstanding VIII. Earning per equity share of Rs.10 each: (1) Basic (2) Diluted 8.27 8.27 9.43 9.43 132.88 19.41 0.00 152.29 512.12 61892014 136.88 21.21 8.48 166.57 520.25 56086198

Significant Accounting Policies & Notes on Financial Statements

26

The accompanying notes (No. 1 to 26) are an integral part of Financial Statements Under reference to our report of even date. For S. K. Bansal & Co. Chartered Accountants S. K. Bansal Partner Membership No. 013147 FRN. 002222N Place : Chandigarh Dated : August 14, 2012 For and on behalf of the Board Vineet Gupta Whole Time Director Pranav Gupta Managing Director

Vipin Gupta V.P . & C. Secretary

R. C. Goyal Sr. V. P . (Finance)

Parabolic Drugs Ltd.

Cash Flow Statement

For the year ended March 31, 2012 (` in million) As at 31.03.2012 As at 31.03.2011

CASH FLOW FROM OPERATING ACTIVITIES (Including WC Changes) - Profit Before Tax - Depreciation & Amortization - Finance Expenses - R & D Expenses Written off - Misc Expenses Written Off - Total Operating Cash flow before WC Changes Working Capital Changes Current Assets - Inventory - Trade Receivable - Loans & Advances & Other Current Assets Increase / (Decrease) in Current Assets Current Liabilities - Trade Payables - Other Current Liabilities & Provisions - Long Term Provisions Increase / (Decrease) in Current Liabilities Net Increase/(Decrease) in Working Capital - Income Tax Total Cash Flow from Operations including WC CASH FLOW FROM INVESTMENT ACTIVITIES - Purchase of Fixed Assets - Investment in Shares - R&D Expenditure Total Cash Flow from Investment Activities (B) 1100.27 (21.07) 934.83 2014.03 1125.75 36.81 640.16 1802.72 (A) 1068.16 187.59 9.83 1265.58 (589.45) 132.88 2070.88 894.87 70.43 7.16 972.46 1100.65 145.36 25.44 1110.84 (534.02) 99.31 676.13 1005.34 821.07 246.70 2073.11 664.41 100.54 641.37 206.14 1.85 1614.31 686.82 82.61 407.60 92.57 1.85 1271.45

Parabolic Drugs Limited | Annual Report 2011-12

47

Cash Flow Statement

For the year ended March 31, 2012 (` in million) As at 31.03.2012 As at 31.03.2011

CASH FLOW FROM FINANCING ACTIVITIES - Share Capital/Share Premium - Term Loans Additions / (Repayments) - Unsecured Loans/Deferred Creditors - Increase / (Decrease) in Working Capital Loans - Dividend - Public Issue Expenses - Finance Expenses Total Cash Flow from Financing Activities Net cash inflow/(outflow) (During the Year) Cash Balance in the beginning of the year Cash Balance at the end of the year (C) (A-B+C) 369.71 166.94 173.59 (36.09) (641.37) 32.78 89.63 256.57 346.20 1848.07 113.68 348.80 74.60 (117.69) (407.60) 1859.86 82.58 173.99 256.57

Under reference to our report of even date. For S. K. Bansal & Co. Chartered Accountants S. K. Bansal Partner Membership No. 013147 FRN. 002222N Place : Chandigarh Dated : August 14, 2012 For and on behalf of the Board

Vineet Gupta Whole Time Director

Pranav Gupta Managing Director

Vipin Gupta V.P . & C. Secretary

R. C. Goyal Sr. V. P . (Finance)

Parabolic Drugs Ltd.

Notes on Financial Statements for the year ended 31st March, 2012
(` in million) As at 31.03.2012 1 SHARE CAPITAL As at 31.03.2011

Authorised 62000000 Equity Shares (Previous Year 62000000) of Rs. 10 each Issued, Subscribed and Fully Paid Up 61892014 Equity Shares (Previous Year 61892014) of Rs. 10 each fully paid up Total Issued, Subscribed & Fully Paid Up Share Capital 618.92 618.92 618.92 618.92 620.00 620.00

(a) Reconciliation of Number of Shares Outstanding As at 31.03.2012 Number Equity Shares Shares outstanding at the beginning of current reporting period Shares Issued & Subscribed during the Period Shares Bought Back Shares outstanding at the end of current reporting period (b) Terms/ Rights Attached to Equity Shares 61892014 618.92 61892014 61892014 618.92 61892014 Amount Number

(` in million) As at 31.03.2011 Amount 618.92 618.92

The Company has only One Class of Equity Shares having par value of Rs. 10 each. Each holder of Equity share is entitled to one vote per share with a right to receive per share dividend declared by the company. The company declares and pays dividend in Indian rupees.The Dividend proposed by Board of Directors is subject to the approval of the Shareholders in the ensuing Annual General Meeting. In the event of liquidation of the Company, the holder of Equity Shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in the proportion to the number of Equity shares held by the Shareholders. (c) Detail of Shareholders Holding more than 5% Shares in the Company As at 31.03.2012 Number M/s PNG Trading Pvt. Ltd. M/s Parabolic Infrastructure Pvt. Ltd. M/s BTS India Private Equity Fund Ltd. 14171836 5935891 5467484 % Holding 22.90% 9.59% 8.83% Number 13614045 5852462 5467484 As at 31.03.2011 % Holding 22.00% 9.46% 8.83%

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49

Notes on Financial Statements for the year ended 31st March, 2012
(` in million) As at 31.03.2012 31.03.2011 2 RESERVE & SURPLUS As at 31.03.2011

Profit and Loss Account At the beginning of the year Add: Net Profit for the Year Less: Appropriations Provision for dividend on equity shares Equity dividend tax At the end of the year Capital Reserve At the beginning and at the end of the year Capital Subsidy At the beginning and at the end of the year Security Premium At the beginning of the year Add: Addition during the Year Less: Public Issue Expenses At the end of the year Net Surplus in the Statement of Profit and Loss 3 LONG TERM BORROWINGS 1291.28 168.05 1459.33 Terms of borrowings are as under: Term Loans from Banks are secured by way 1st pari passu charge on all existing & future fixed assets of the company at all locations with equitable mortgage of land & building, 2nd pari passu charge on all the current assets of the Company and pari passu charge on the collateral properties of M/s Parabolic Infrastructure P Ltd, M/s PNG Trading P Ltd & also personally guranteed by Mrs Rama Gupta,Mr. J.D.Gupta,Mr T.N Goel, Mr Pranav Gupta and Mr Vineet Gupta. 4 DEFERRED TAX LIABILITIES (NET) 921.57 1.11 922.68 1631.18 1631.18 3665.22 157.91 1601.67 128.40 1631.18 3171.08 3.00 3.00 0.34 0.34 15.47 2.51 2030.70 30.95 5.14 1536.56 1536.56 512.12 1052.40 520.25

Secured: Term Loans from Banks Unsecured: Due to Others

Deferred Tax Liability Related to Fixed assets 116.94 116.94 97.53 97.53

Parabolic Drugs Ltd.

Notes on Financial Statements for the year ended 31st March, 2012
(` in million) As at 31.03.2012 31.03.2011 5 LONG TERM PROVISIONS 14.72 16.16 30.88 6 SHORT TERM BORROWING 9.49 11.56 21.05 As at 31.03.2011

Provision for Employee Benefits-Gratuity Provision for Employee Benefits-Leave Encashment

Secured: Working Capital Loans from Banks: - Cash Credit - Buyer Credit - Packing Credit - FCNR - Bills Discounted Unsecured: Working capital loan from Banks 362.19 3764.55 609.28 3590.96 2150.29 447.03 547.11 257.93 1382.56 718.95 340.19 225.78 314.20

Working Capital borrowings from Banks are secured by way of first pari passu charge on hypothecation of entire present & future current assets of the Company, Second pari passu charge on all fixed assets of the Company and pari passu charge on the collateral properties of M/s Parabolic Infrastructure Pvt Ltd, M/s. PNG Trading Pvt Ltd & also personally guaranteed by Mrs. Rama Gupta, Mr. J.D. Gupta ,Mr T.N Goel, Mr. Pranav Gupta and Mr. Vineet Gupta.

TRADE PAYABLES 2674.50 77.26 90.18 2841.94 1649.04 41.82 82.92 1773.78

Sundry Creditors - Materials Sundry Creditors - Expenses Sundry Creditors - Capital Expenses

OTHER CURRENT LIABILITIES 323.36 2.52 0.05 14.76 100.10 54.34 495.13 230.36 0.05 5.72 26.42 40.99 303.54

Current maturities of Long Term Debt Interest accrued but not due on Borrowings Share Application money due for refund Advance from Customers Statutory Liabilities Other Expenses Payable

Parabolic Drugs Limited | Annual Report 2011-12

51

Notes on Financial Statements for the year ended 31st March, 2012
(` in million) As at 31.03.2012 31.03.2011 9 SHORT TERM PROVISIONS 132.88 15.47 2.51 150.86 136.88 30.95 5.14 172.97 As at 31.03.2011

Provision for Income Tax Proposed Dividend on Equity shares Corporate Dividend Tax on Dividend

10

FIXED ASSETS
GROSS BLOCK Rate of Dep. (%) As on 1.4.2011 Addition During the Year Deduction During the Year Total As on 31.3.2012 As on 1.4.2011 DEPRECIATION Provided During the Year Assets As on Sold / 31.3.2012 Written Back / Adjustment NET BLOCK As on 31.3.2012 As on 31.3.2011

Tangible Assets: Land & Site Development Factory Building Non Factory Building Plant & Machinery Furniture & Fixture Tubewell Vehicles Computers & Peripherals Research & Development Fixed Assets 1847.44 350.01 3.55 2193.90 219.87 99.86 0.94 318.79 1875.11 1627.57 3.34% 1.63% 5.28% 6.33% 1.63% 9.50% 16.21% 7.80 333.33 6.50 1109.26 18.55 3.18 24.95 9.61 334.26 28.98 295.74 7.46 1.56 4.56 1.70 10.01 3.35 0.20 7.80 362.31 6.50 1405.00 26.01 4.74 26.16 11.31 344.07 24.69 0.87 146.15 3.17 0.18 8.49 4.67 31.65 11.46 0.11 65.94 1.24 0.06 2.50 1.66 16.89 0.94 36.15 0.98 212.09 4.41 0.24 10.05 6.33 48.54 7.80 326.16 5.52 1192.91 21.60 4.50 16.11 4.98 295.53 7.80 308.64 5.63 963.11 15.38 3.00 16.46 4.94 302.61

Intangible Assets: Computer Software 16.21% 2.67 2.67 2.53 2.53 5.20 5.20 0.71 0.71 0.68 0.68 1.39 1.39 3.81 3.81 1.96 1.96

Capital Work In Progress:

1122.54 1122.54

951.41 951.41

201.07 201.07

1872.88 1872.88

1872.88 1872.88

1122.54 1122.54

TOTAL

2972.65

1303.95

204.62

4071.98

220.58

100.54

0.94

320.18

3751.80

2752.07

Parabolic Drugs Ltd.

Notes on Financial Statements for the year ended 31st March, 2012
(` in million) As at 31.03.2012 31.03.2011 11 a. NON CURRENT INVESTMENTS Trade Investments: As at 31.03.2011

Parabolic Research Labs Ltd (Unquoted, Fully paid up) 2950000 equity Shares (PY 2950000) of Rs. 10/- each Parabolic Research Labs Ltd Unquoted, Fully paid up, towards Share Application Money pending allotment Ziven Lifesciences Ltd Unquoted, Fully paid up, 399996 equity Shares (PY nil ) of Rs. 10/- each b. Non Trade Investments: Investment in equity instruments Nimbua Greenfield (Punjab) Ltd- Unquoted, Fully paid up 18750 Equity shares (PY 25000) of Rs. 10/- each Investment in Mutual funds- Quoted, Fully Paid up SBI - SHF Ultra Short Term Fund Nil units (PY- 1952880.89) of Rs. 10/- each 35.66 56.73 0.18 0.25 25.00 4.00 1.98 1.98 29.50 29.50

12

OTHER NON CURRENT ASSETS

Other Non Current Assets - Preliminary Expenses - Research & Development Expenses 11.32 1626.17 1637.49 13.17 897.48 910.65

13

INVENTORIES 462.18 4016.08 31.53 7.53 4517.32 392.85 3005.02 1.26 7.35 3406.48

Raw Materials Work in Progress/ Semi Finished Goods Finished Goods Stores and Consumables

Inventory has been valued as per inventory taken, valued and certified by the management on which we have relied upon.

Parabolic Drugs Limited | Annual Report 2011-12

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Notes on Financial Statements for the year ended 31st March, 2012
(` in million) As at 31.03.2012 31.03.2011 14 TRADE RECEIVABLES As at 31.03.2011

(Unsecured, Considered Good) Outstanding for a period of: - More than six Months - Less than six Months Less: Provision for doubtful debts 469.36 1748.20 2217.56 168.29 2583.29 2751.58

15

CASH & CASH EQUIVALENTS 1.21 32.32 312.67 346.20 8.30 11.55 236.72 256.57

Cash in hand and as imprest Balance with Banks - Current accounts - Fixed Deposit accounts

16

SHORT TERM LOANS & ADVANCES 11.55 2.31 24.16 139.19 13.83 45.92 227.35 464.31 3.43 21.96 137.53 23.44 42.01 142.13 370.50

Loans and Advances to Related Parties Loans and Advances to Employees Security Deposits Deposits/Balances with Statutory Authorities Unexpired Expenses Commercial Advances - For Raw materials/ Expenses - For Capital Goods Other Loans and Advances

17

OTHER CURRENTS ASSETS 3.13 170.30 173.43 1.42 166.51 167.93

Interest accrued but not due on Fixed deposits Advances Recoverable in cash or kind or for value to be received

Parabolic Drugs Ltd.

Notes on Financial Statements for the year ended 31st March, 2012
(` in million) As at 31.03.2012 31.03.2011 18 REVENUE FROM OPERATIONS 10123.08 80.04 959.68 9243.44 6752.97 38.22 592.75 6198.44 As at 31.03.2011

Gross Revenue from sale of products Other Operating Revenue Less: Excise duty attributable to products sold

19

OTHER INCOME 29.79 10.98 40.77 10.84 142.61 153.45

Interest Income Other non-operating income

20

COST OF MATERIALS CONSUMED

Raw Material Opening Stock Add: Purchases Less: Closing Stock Stores and Spares Opening Stock Add: Purchases Less: Closing Stock 7.35 37.17 7.53 36.98 8004.48 5.55 37.35 7.35 35.55 5410.89 392.85 8036.82 462.18 7967.49 287.13 5481.06 392.85 5375.34

21

(INCREASE)/DECREASE IN INVENTORIES OF FINISHED GOODS, WORK-IN-PROGRESS AND STOCK IN TRADE

Opening Stock: Finished Goods Work in Progress Closing Stock: Finished Goods Work in Progress 31.53 4016.08 4047.61 (1041.33) 1.26 3005.02 3006.28 (897.82) 1.26 3005.02 3006.28 2108.46 2108.46

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Notes on Financial Statements for the year ended 31st March, 2012
(` in million) As at 31.03.2012 31.03.2011 22 EMPLOYEE BENEFIT EXPENSES 200.41 9.03 15.72 225.16 150.76 6.67 11.87 169.30 As at 31.03.2011

Salary, Wages and other allowances Staff and labour Welfare Expense Contribution to Statutory Funds

23

FINANCE COST 504.82 155.59 (19.04) 641.37 298.53 96.53 12.54 407.60

Interest expense Other Borrowing cost Applicable net loss on foreign currency transactions and translations

24

DEPRECIATION & AMORTISATION EXPENSES 100.54 1.85 206.14 308.53 82.61 1.85 92.57 177.03

Depreciation Miscellaneous Expenditure written off Research and development expenditure written off

25

OTHER EXPENSES 98.06 13.73 2.37 5.71 32.95 24.30 8.59 59.93 0.77 1.26 14.04 1.58 3.58 2.73 60.96 10.32 0.70 5.46 45.29 13.62 10.71 65.23 0.40 1.19 7.26 0.89 2.82 2.17

Water & Electricity charges Repair & maintenance - Machinery - Building - Others Job work charges Generator set expenses Lab expenses Freight & other expenses (inward) Hire charges (nitrogen tank) Travelling & conveyance - Directors (including foreign travelling) - Others (including foreign travelling) Vehicle running & maintenance Printing & stationery Telephone expenses

Parabolic Drugs Ltd.

Notes on Financial Statements for the year ended 31st March, 2012
(` in million) As at 31.03.2012 31.03.2011 Postage & telegram Insurance expenses Rate, fees & taxes Legal & professional charges Directors remuneration Office expenses Security charges Auditors' remuneration - Statutory auditor - Internal auditor - Out of pocket expense Charity & donation Director sitting fee Advertisement Office rent Subscription fee Festival expenses Testing charges Newspaper,books & periodicals General repair & maintenance Loss on sale of fixed assets/shares Service charges Insurance expenses (sales) Freight & cartage outward Clearing & forwarding (export) Commission on sale Business promotion Exhibition & fair expenses Rebate & discount Miscellaneous expenses 0.60 0.23 0.01 0.08 0.11 0.35 2.95 0.42 0.17 0.99 0.04 2.78 1.11 0.28 6.57 10.13 32.42 25.60 13.59 0.09 51.36 6.67 481.59 0.45 0.17 0.03 0.61 0.09 0.85 2.18 0.19 0.49 0.51 0.11 2.05 0.57 0.59 5.83 15.85 17.44 17.77 35.74 3.45 24.08 2.93 398.07 2.76 8.98 5.11 10.25 18.00 6.09 4.25 As at 31.03.2011 2.75 8.49 1.72 3.76 15.00 3.98 3.37

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Notes on Financial Statements for the year ended 31st March, 2012

SIGNIFICANT ACCOUNTING POLICIES


The company's summarized significant accounting policies are stated as below A. CONVENTION The financial statements have been prepared in accordance with the applicable Accounting Standards referred to in the Companies (Accounting Standards) Rules 2006 issued by the Central Government in exercise of the power conferred under subsection (1)(a) of section 642 and relevant provisions of the Companies Act, 1956. The financial statements have also been prepared in accordance with relevant presentational requirements of the Companies Act, 1956. The accounting policies have been consistently applied by the company unless otherwise stated. B. BASIS OF ACCOUNTING The financial statements have been prepared in accordance with the historical cost convention on accrual basis in accordance with Accounting Standard -1 Disclosure of Accounting Policies. All assets and liabilities have been classified as current or non current as per the company's normal operating cycle and other criteria set out in revised schedule VI to the Companies Act, 1956 based on the nature of products and the time between the acquisition of assets for processing and their realization in cash and cash equivalents. The accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policy explained in Additional Notes. C. FIXED ASSETS All the fixed assets are stated at cost of acquisition less accumulated depreciation and impairment loss, if any. Cost of acquisition of fixed assets includes all direct cost relating to the acquisition and installation of fixed assets as per Accounting Standard 10Accounting for Fixed Assets. Borrowing costs directly attributable to acquisition or construction of fixed assets, which necessarily take substantial period of time to get ready for their intended use are capitalized in accordance with Accounting Standard -16 Borrowing costs. Expenditure and outlays of money on uncompleted Fixed Assets are shown as capital work in progress until such time the same are completed. Capital work in progress is stated at cost. D. DEPRECIATION Depreciation on Fixed assets, Tangible and Intangible, have been provided on continuous process basis at the rates and in the manner specified in Schedule XIV to the Companies Act, 1956. During the year, depreciation on all the fixed assets has been provided at the rates applicable to continuous process industry on the straight-line method. E. IMPAIRMENT OF ASSETS The company provides for impairment loss, if any, to the extent, the carrying amount of assets exceed their recoverable amount. Recoverable amount is higher of an asset's net selling price and its value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of an asset and from its disposal at the end of its useful life. An impairment loss is charged to Profit and Loss Account in the year in which an asset is identified as impaired. F. PRE-OPERATIVE EXPENSES Pre-operative expenses represent expenses incurred prior to the date of commencement of commercial production for setting up new manufacturing facilities or expansion of existing facilities. Until capitalization, all expenses are disclosed under pre-operative expenses pending allocation/capitalization and allocated to cost of fixed assets on capitalization. G. INVENTORIES Inventories are valued in accordance with Accounting Standard -2 Valuation of Inventories and the method of valuation is given as under: (i) Raw Material, Stores and Spares and Packing Materials

Parabolic Drugs Ltd.

Notes on Financial Statements for the year ended 31st March, 2012

Lower of Cost or Net Realizable Value whichever is less on FIFO Basis. However, materials and other items held for use in the production of finished goods are not written down below cost if the products in which they will be used are expected to be sold at or above cost. (ii) Works in Process / Semi Finished Goods At cost up to estimated stage of completion. Cost includes direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity. (iii) Finished Goods Lower of cost and net realizable value. Cost includes direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity. Cost of Finished goods includes excise duty. H. REVENUE RECOGNITION Revenue is recognized to the extent that it can be reliably measured and is probable that the economic benefits will flow to the company. The following specific recognition criteria must also be met before revenue is recognized. Sale of Goods Revenue from sale of Goods is recognized at the point of dispatch of finished goods. The VAT liability has been provided as per the VAT Returns filed. The additional liability arising at the time of assessment will be booked as & when arise. Sales are exclusive of VAT. Excise Duty deducted from Revenue (Gross) is the amount that is included in the Revenue (Gross) and not the entire amount of liability arising during the year. Interest Income Interest Income is recognized on time proportionate basis taking into account the amount outstanding and the applicable interest rate. Interest income is included under the head "Other Income" in the statement of Profit and Loss. Income from Job Work Income from job work is recognized on the basis of work executed as per the contract/agreement. DEPB (Duty Entitlement Pass Book) Income DEPB income is recognized by the Company after the admission of export benefit credited against the DEPB license realized from the Director General of Foreign Trade on eligible exports made by the Company and the gain (recognized on the basis of discount amount and the resultant difference between the license value and purchase value) on purchase of DEPB licenses from exporters for the purpose of payment of customs duty on import of raw material by the Company is also included within DEPB income. Investment Income Income from Investments is accounted on an accrual basis, inclusive of related tax deducted at source. Income from Dividends is accounted when the right to receive such dividends is established. I. FOREIGN CURRENCY TRANSACTIONS Foreign Currency Transactions are accounted for in accordance with Accounting Standard-11-The Effects of changes in Foreign Exchange Rates. Transactions in foreign currencies are recorded at the rates prevailing on the date of the transaction. Monetary items denominated in foreign currency are restated at the rate prevailing as on the balance sheet date. Exchange differences arising on the settlement of monetary items or on reporting companys monetary items at rates different from those at which they were initially recorded during the year are recognized as income or expenses in the year in which they arise. Foreign Currency Monetary assets and liabilities are translated at the exchange rate prevailing on the balance sheet date. Any gains or losses are recognized in the profit and loss account.

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59

Notes on Financial Statements for the year ended 31st March, 2012

J.

INVESTMENTS The company follows AS-13 Accounting for investments for treatment of its investments. Long Term investments are stated at cost. However, provision for diminution in value, other than temporary is made. Current investments are stated at the lower of cost and fair value, which is determined on an individual investment basis.

K.

RETIREMENT AND OTHER EMPLOYEE BENEFITS Retirement Benefits are accounted in accordance with Accounting Standard -15 Accounting for retirement benefits in the financial statements of employers as follows: i) Defined Contribution Plan: Retirement benefit in the form of provident fund is a defined contribution scheme. The company makes regular monthly contributions to Provident Funds and such paid/payable amounts are charged against revenue. ii) Defined Benefit Plans: Liability in respect of defined benefit plans i.e. gratuity and leave encashment, are determined based on actuarial valuation made by an independent actuary as at balance sheet date .The actuarial gains or losses are recognized immediately in the profit and loss account.

L.

BORROWING COSTS Borrowing costs include interest and commitment charges on borrowings. As per Accounting Standard -16 Borrowing Costs Costs incurred on borrowings directly attributable to development projects, which take substantial period of time to complete, are capitalized to respective projects and all other borrowing costs are recognized in the profit and loss account in the period in which they are incurred.

M. SEGMENT REPORTING The company is exclusively in the Pharmaceutical business segment and thus there is not more than one reportable segment, therefore the disclosure in the context of Accounting Standard 17 Segment Reporting has not been considered necessary. N. TAXES ON INCOME The company provides for Current tax as the amount of tax payable in respect of taxable income for the period, measured using the applicable tax rates and tax laws. Deferred tax is recognized on timing differences between taxable income and accounting income subject to the consideration of prudence, measured using the tax rates and tax laws that have been enacted or substantially enacted by the balance sheet date. Further, in respect of Deferred tax asset, it is recognized to the extent there is virtual certainty that there will be sufficient future taxable income available to realize such assets. O. EARNING PER SHARE Basic Earning per Share is calculated by dividing the net earnings after tax for the year attributable to equity shareholders by weighted average number of equity shares outstanding during the year. For the purpose of calculating diluted earning per share net profit or loss for the year attributable to equity shareholders and weighted average number of equity shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares. P . RESEARCH AND DEVELOPMENT EXPENSES In accordance with the Accounting Standard -26 "Intangible Assets", Cost incurred on research and development expenses of revenue nature are recognized as intangible assets and amortized on a straight line basis over a period of five years. Subsequent expenditure on research and development of revenue nature are also added to the cost of intangibles and also written off in succeeding five years.

Parabolic Drugs Ltd.

Notes on Financial Statements for the year ended 31st March, 2012

Capital expenditure on Research & Development is shown under R&D Equipment under Fixed Assets and depreciation have been provided at the rates and in the manner provided according to Schedule VI of the Companies Act 1956. Q. AMORTISATION OF EXPENSES Preliminary Expenses are amortized over a period of ten years. R. EXPORT BENEFITS/ INCENTIVES Export entitlements under Duty Entitlement pass Book [DEPB] Scheme are recognized in the Profit & Loss Account when the right to receive credit as per terms of the scheme is established in respect of export made. Obligations/entitlements on account of Advance license scheme for import of raw material are accounted for on purchase of raw material and/ or export sales. S. CONTINGENT LIABILITIES AND PROVISIONS In accordance with Accounting Standard -29- Provisions, Contingent Liabilities and Contingent Assets, which are material and where future outcome cannot be ascertained with reasonable certainty are treated as contingent and disclosed in notes on accounts to financial statements after careful evaluation by the management of the facts and legal aspects of the matters involved. T. USE OF ESTIMATES In preparing companies financial statement in conformity with the accounting principles generally accepted in India, management is required to make estimates and assumptions that effect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of financial statements and reported amount of revenue and expenses during the reporting period. Actual results could differ from those estimates. Difference between actual results and estimates are recognised in the period in which the results are known/ materialised. U. FINANCIAL DERIVATIVES HEDGING TRANSACTIONS The use of Financial Derivatives Hedging Contracts is governed by the Companys policies which provide principles on the use of such financial derivatives consistent with the companys risk management strategy. The company does not use derivative financial instruments for speculative purposes. Financial Derivatives Hedging Contracts are accounted on the date of their settlement/termination and realized gain/loss in respect of the settled/terminated contracts is recognized in the profit and loss account. V. CASH AND CASH EQUIVALENTS Cash and cash equivalents for the purposes of cash flow statement comprise cash at bank and in hand and short term investments with an original maturity of not more than three months.

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Notes on Financial Statements for the year ended 31st March, 2012
26 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTS: (a) During the year ended 31st March 2012, the Revised Schedule VI notified under the Companies Act, 1956, has become applicable to the company, for preparation and presentation of its financial statements. The adoption of revised schedule VI does not impact recognition and measurement principles followed for preparation for financial statements. However, it has significant impact on presentation and disclosures made in financial statements. The company has also regrouped/ reclassified the previous year figures to correspond with the current year's classification/ disclosure. (b) Debit or Credit Balances on whatever account are subject to confirmation/ reconciliation. (c) The work-in-process / semi finished goods and by product etc. have been grouped as closing stock and the variation is stock has been worked out accordingly. (d) The amount less received from the parties against sales made to them has been charged to Rebate & Discount Account. (e) In the opinion of the Board of Directors, all current assets and loans and advances have a value on realization at least equal to the amount at which they are stated in the Balance Sheet. Adequate provisions have been made for all the known liabilities. (f) The Company has called for the information from its suppliers as regard to disclosure required under Micro, Small and Medium Enterprises Development Act, 2006. The replies from most of the suppliers in this regard are still awaited.

(g) Commission on sales and rebate & discount are accounted for when accounts are finally settled with the agents. (h) Stock of stores and consumables amounting to Rs.7.53 mn comprises spares and others consumable items. The value as estimated and certified by the management has been considered. (i) (j) Fixed Deposit with banks Rs.312.67 mn. (Previous year Rs.236.71 mn.) are pledged as margin money with banks. The total revenue expenditure incurred during the year on Research & Development amounted to Rs. 933.38 mn. have been treated as deferred revenue expenditure and will be written off over the period of 5 years so as to depict the true financial position of the company as per policy of the company followed in proceeding years.

(k) The DEPB Income comprises export benefit against the DEPB Licenses realized from Director Gen. of Foreign Trade, Ministry of commerce, Govt. of India on eligible export made by the company and the gain (i.e. the discount amount and resultant difference between the license value and purchase value) on purchase of DEPB License from exporter for the purpose of payment of Custom Duty on import of raw material by the company. (l) Export Incentive have been accounted on accrual basis.

(m) The Inventory comprises of raw material, stores & spares, packing material, stock of work in progress including recovery stock and material at shop floor as physically verified as on 31st March 2012, valued and certified by the management has been considered. (n) The company has circulated the balance confirmation letters for the balance confirmation from sundry Debtors and Creditors as on 31st March, 2012. However, in the absence of confirmation, the balances have been taken as per records of the company. (o) i) Disclosure in accordance with accounting standard (AS 29) Provisions, Contingent Liabilities and Contingent Assets: (` in million)
Particulars As at 1st April, 2011 Additions during the year Amount paid/ reversed during the year As at 31st March, 2012

Gratuity Leave Encashment ii)

9.49 11.56

5.78 6.52

0.55 1.92

14.72 16.16

Taxation matters in respect of which appeals are pending: Particulars Central Excise Duty # Rs. 0.34 million have been deposited towards disputed liability 2011-12 0.59 #

(` in million) 2010-11 0.59 #

Parabolic Drugs Ltd.

Notes on Financial Statements for the year ended 31st March, 2012
26 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTS: (p) Taxation i) In order to comply with the requirement of section 211(3c) of the Companies Act, 1956 consequent to Accounting Standard 22 Accounting for Taxes on Income, the company has followed the deferred tax method of accounting. Consequently the company has accounted the deferred tax for the current period amounting to Rs.19.41 Million in the Statement of Profit & Loss. Deferred Tax Asset/ Liability are attributable to the following items: Deferred Tax Asset (Liability) 31.3.2011 (97.53) (97.53) Charge/ Credit (` in million) Deferred Tax Asset (Liability) 31.3.2012 (116.94) (116.94)

ii)

Particulars

Deferred Tax Liability Difference between Tax and Book Written down value of Fixed Assets (19.41) (19.41)

(q) Fixed Assets possessed by PARABOLIC DRUGS LIMITED are treated as Corporate Assets and are not cash generating units as per Accounting Standard-28 issued by the Institute of Chartered Accountants of India. In the opinion of Management there is no impairment of fixed assets of the Company. (r) Employee Benefits: Consequent upon adoption of Accounting Standard on Employee Benefits" (As 15) (Revised 2005), as required by the Standard, the following disclosures are made : (` in million) Reconciliation of opening and closing balances of the present value of the defined benefit obligation Obligation at period beginning Current service Cost Reconciliation of opening and closing balances of the present value Actuarial (gain)/loss Benefits paid Obligation at the year end (March 31, 2012) Changes in plan assets Plan assets at period beginning, at fair value Expected return on plan assets Actuarial gain / (loss) Contributions Benefits paid Plan assets at the year end, at fair value Reconciliation of present value of the obligation and the fair value of plan assets Fair value of plan assets at the end of the year Present value of the defined benefits obligation at the end of the year Liability / (Asset) recognized in the Balance Sheet Cost for the year Current Service Cost 4.64 5.71 Nil 14.72 14.72 Nil 16.16 16.16 (April1, 2011) Leave Encashment (Unfunded) 9.49 4.64 0.77 0.37 -0.55 14.72 N.A. Nil Nil Gratuity (Unfunded) 11.56 5.71 0.94 -0.13 -1.92 16.16 N.A. -

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Notes on Financial Statements for the year ended 31st March, 2012
26 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTS: Interest Cost Expected return on plan assets Actuarial (gain)/ loss Net Cost recognized in the Profit and Loss Account Assumption used to determine the benefit obligations: Interest rate Estimated rate of return on plan assets Expected rate of increase in salary Actual return on plan assets (s) Earnings Per Share 2012 Profit for the year Weighted average number of Ordinary shares outstanding Add: Dilutive effect of potential ordinary shares Weighted average number of Ordinary shares in computing diluted earning per share Earnings per share on profit for the year (Face value Rs.10/- per share) - Basic - Diluted (t) 8.27 8.27 9.43 9.43 512.12 61892014 61892014 (` in million) 2011 528.73 56086198 56086198 8.60% N.A. 10.00% 8.60% N.A. 10.00% 0.77 0.37 5.78 -0.13 6.52 0.94 -

Related Party Disclosures in accordance with the Accounting Standard-18 as notified by the Companies (Accounting Standard) Rules, 2006 Key Management Personnel with whom transactions have taken place during the Year 1. 2. Shri Pranav Gupta Shri Vineet Gupta Managing Director Whole Time Director

Relatives of Key Management Personnel with whom transactions have taken place during the Year 1. 3. Shri J.D Gupta Smt. Rama Gupta 2. J.D Gupta (HUF) 4. Dr. Deepali Gupta

Subsidiary with whom transactions have taken place during the Year 1. Parabolic Research Lab Limited 2. Ziven Life Sciences Limited

Associates with whom transactions have taken place during the Year 1. 3. 5. PNG Trading Private Limited Vineet Packaging Industries Saj Infrastructure Private Limited 2. Parabolic Infrastructure Private Limited 4. Parabolic Estates Private Limited 6. Trackball Technology Private Limited

Parabolic Drugs Ltd.

Notes on Financial Statements for the year ended 31st March, 2012
26 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTS: Related Party Transactions Disclosure of transactions between the company and the Related parties and the status of outstanding balances as on 31.03.2012 Nature of Transactions (Excluding Reimbursements) Remuneration to Key Management Personnel Rent Paid Purchase of Fixed Assets Loan & Advances given Loan & Advances taken Share Application Money Purchase of Goods Sale of Goods Salary Investment Balances as on 31st March, 2012 Investments Loans & Advances Loans (Liability) Sundry Creditors Sundry Debtors Note: Figures in Italics represents Previous Year's amount. 35.48 31.48 10.47 Nil 0.11 Nil 161.05 Nil 0.67 0.23 0.97 Subsidiary Associates Key Management Personnel 3.00 Nil 0.11 Nil 161.05 Nil 2.32 1.21 0.97 Nil 18.00 15.00 Relatives of Key Management Personnel 0.76 0.66 1.20 Nil Total

10.47 Nil Nil 1.98 4.00 10.00

18.00 15.00 0.76 0.66 3.00 Nil 10.57 Nil 161.05 Nil Nil 1.98 2.32 1.21 0.97 Nil 1.20 Nil 4.00 10.00

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65

Notes on Financial Statements for the year ended 31st March, 2012
26 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTS: (u) The following expenses incurred during the year as attributable to the fixed assets (including Capital Work in Progress) have been capitalized: (` in million) Particulars Salary and Allowances Consultancy Charges Bank Interest/ Processing Fee Power & Fuel Others Amount 10.78 1.34 76.26 35.34 6.30 130.02 (v) The Company has been approved U/s 35 (2AB) of the Income Tax Act, 1961 by the Prescribed Authority i.e. The Secretary, Department of Scientific and Industrial Research, Govt. of India, New Delhi for co-operation in In-house Research and Development facility at Derabassi and Barwala. The exemption from Director General of Income Tax (Exemption) is extended upto 31.3.2015 for Derabassi and up to 31.03.2013 for Barwala unit. (w) The Ministry of Corporate Affairs, Government of India, vide General Circular No. 2 and 3 dated 8th February, 2011 and 21st February, 2011 respectively has granted a general exemption from compliance with section 212 of the Companies Act, 1956, subject to fulfillment of conditions stipulated in the circular. The Company has satisfied the conditions stipulated in the circular and hence is entitled to the exemption. Necessary information relating to the subsidiaries has been included in the Consolidated Financial Statements. (x) There is a sum of Rs. 0.59 million outstanding on account of excise duty out of which a sum of Rs. 0.34 million has been deposited and balance of Rs. 0.26 million has not been deposited on account of dispute for which appeal is pending. (y) There is an outstanding liability of Rs.93.2 million on account of income tax for the Ay 2011-12 which has not been deposited on account of assessment proceedings, under process in view of proceedings initiated under section 132 of Income tax act 1961 in the financial year 2010-11. (z) The Ministry of Corporate Affairs, Government of India vide its General Notification No. S.O. 301 (E) dated 8th February, 2011 issued under Section 211 (3) of the Companies Act, 1956 has exempted certain classes of companies from disclosing certain information in their profit and loss account. The Company being an export oriented company is entitled to the exemption. Accordingly, disclosures mandated by paragraphs 3(i) (a), 3(ii)(a), 3 (ii)(b) and 3(ii)(d) of Part II, Schedule VI to the Companies Act, 1956 have not been provided. (za) Additional information pursuant to the provision of paragraph 3 and 4 of Part-II of Schedule-VI of the Companies Act, 1956. [As certified by the Management and accepted by the Auditors] i) Value of Imports during the year (C.I.F Basis) As at 31.03.2012 Raw materials Capital goods 1785.34 54.95 (` in million) As at 31.03.2011 2592.23 22.85

Parabolic Drugs Ltd.

Notes on Financial Statements for the year ended 31st March, 2012
26 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTS: ii) Expenditure in Foreign Currency As at 31.03.2012 Salary Consultancy expenses Travelling expenses Commission on sales Fee & Taxes Business promotion expenses R & D Expenses iii) Earnings in Foreign Currency As at 31.03.2012 Export of Goods (F.O.B) 1212.46 10.62 1.61 3.33 14.75 1.89 0.44 (` in million) As at 31.03.2011 1736.17 12.00 1.51 3.40 (` in million) As at 31.03.2011 1.57 2.20

iv)

Dividend remittance in foreign currency As at 31.03.2012

(` in million) As at 31.03.2011 NIL

Amount of Dividend

1.02

(zb) Contingent Liabilities As at 31.03.2012 Letter of Credit (Foreign/ Inland) * Bank Guarantees Custom Duty # 2540.40 29.99 21.70

(` in million) As at 31.03.2011 1451.41 30.81 21.70

* Out of above material valuing Rs. 2413.88 Million (Previous year Rs 1232.21 million) has been received by 31.03.2012 and credited to respective Creditor Account. # The Company has received show clause notices from the Jt. Director General of Foreign Trade towards the non-fulfilment of export obligation against the Advance Licences obtained for import of duty free raw material. Though the company has taken up the matter with appropriate authority for the extension of export obligation period. In this regard the estimated contingent liability is Rs. 21.7 million towards the custom duty. (zc) Segment Reporting: There is not more than one reportable segment. Hence information as per AS-17 is not required to be disclosed.

For and on behalf of the Board

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67

Consolidated Auditors Report


To The Board of Directors of Parabolic Drugs Limited on the Consolidated Financial Statements of Parabolic Drugs Limited and its Subsidiaries We have audited the attached Consolidated Balance Sheet of M/s. Parabolic Drugs Limited (The Company) and its Subsidiaries as at 31th March 2012, the Consolidated Statement of Profit & Loss for the year ended on that date annexed thereto and the Consolidated Cash Flow Statement for the year ended on that date, which we have signed under reference to this report. These Consolidated 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. 1. We conducted our audit in accordance with auditing standards generally accepted in India. These 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. We report that the Consolidated Financial Statements have been prepared by the company's management in accordance with the requirements of Accounting Standards (AS) 21 Consolidated Financial Statements and Accounting Standard (AS) 23 Accounting for Investment in Associates in Consolidated Financial Statements notified by Companies (Accounting Standard) Rules, 2006 and on the separate audited financial statements of Parabolic Drugs Limited and its Subsidiaries included in the Consolidated Financial Statements. On the basis of the information and explanations given to us and on consideration of the Audit Reports on individual audited financial statements of Parabolic Drugs Limited and its aforesaid subsidiaries. In our opinion, the Consolidated Financial Statements together with Note-26 to financial statements attached thereto give a true and fair view in conformity with the accounting principles generally accepted in India. (a) in the case of Consolidated Balance Sheet, of the consolidated state of affairs of the Parabolic Drugs Limited and its Subsidiaries as at 31st March 2012; (b) in the case of Consolidated Statement of Profit & Loss , of the Consolidated Profit of the Parabolic Drugs Limited and its Subsidiaries for the year ended on that date. In case of Consolidated Cash Flow Statement, of the consolidated cash flows of the Parabolic Drugs Limited and its Subsidiaries for the year ended on that date.

2.

For S. K. Bansal & Co., Chartered Accountants

S. K. Bansal Partner Place: Chandigarh Dated: August 14, 2012 Membership No: 013147 FRN 002222N

Parabolic Drugs Ltd.

Consolidated Balance Sheet

As at March 31, 2012 (` in million) Note As at 31.03.2012 As at 31.03.2011

I.

EQUITY AND LIABILITIES (1) Shareholders' Funds (a) Share Capital (b) Reserves and Surplus (2) Minority Interest (3) Non-Current Liabilities (a) Long-term borrowings (b) Deferred tax liabilities (Net) (c) Long term provisions (4) Current Liabilities (a) Short-term borrowings (b) Trade payables (c) Other current liabilities (d) Short-term provisions Total 6 7 8 9 3764.55 2842.56 498.06 150.86 13148.82 3590.96 1773.78 303.55 172.97 10673.02 3 4 5 1459.33 116.94 30.88 922.68 97.53 21.05 1 2 618.92 3665.22 1.50 618.92 3171.08 0.50

II.

ASSETS (1) Non-current assets (a) Fixed assets (i) Tangible assets (ii) Intangible assets (iii) Capital work-in-progress (b) Non-current investments (c) Other non-current assets (2) Current assets (a) Inventories (b) Trade receivables (c) Cash and cash equivalents (d) Short-term loans and advances (e) Other current assets Total 13 14 15 16 17 4517.32 2217.56 346.82 454.34 173.43 13148.82 26 3406.48 2751.58 256.76 370.50 167.93 10673.02 11 12 10 1875.13 3.96 1922.15 0.19 1637.92 1627.57 1.96 1154.02 25.25 910.97

Significant Accounting Policies & Notes on Financial Statements

The accompanying notes (No. 1 to 26) are an integral part of Financial Statements Under reference to our report of even date. For S. K. Bansal & Co. Chartered Accountants S. K. Bansal Partner Membership No. 013147 FRN. 002222N Place : Chandigarh Dated : August 14, 2012 For and on behalf of the Board Vineet Gupta Whole Time Director Pranav Gupta Managing Director

Vipin Gupta V.P . & C. Secretary

R. C. Goyal Sr. V. P . (Finance)

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Consolidated Statement of Profit and Loss For the year ended March 31, 2012
(` in million) Note REVENUE I. II. Revenue from Operations Other Income 18 19 9243.44 40.77 9284.21 6198.44 153.45 6351.89 As at 31.03.2012 As at 31.03.2011

III. Total Revenue (I +II) EXPENSES Cost of Materials consumed Changes in inventories of finished goods, work-in-progress and Stock-in-Trade Employee benefit expenses Finance costs Depreciation and amortization expense Other expenses IV. Total Expenses V. Profit before tax(III-IV) 22 23 24 25 20 21

8004.48 (1041.33)

5410.89 (897.82)

225.16 641.37 308.53 481.59 8619.80 664.41

169.30 407.60 177.03 398.07 5665.07 686.82

VI. Tax expense: (1) Current tax (including wealth tax) (2) Deferred tax Charge/ (Credit) (3) Tax Adjustment Earlier Years Total Tax Expenses VII. Profit for the period (V-VI) Weighted Average Number of Equity Shares Outstanding VIII. Earning per equity share of Rs.10 each: (1) Basic (2) Diluted 8.27 8.27 9.43 9.43 132.88 19.41 152.29 512.12 61892014 136.88 21.21 8.48 166.57 520.25 56086198

Significant Accounting Policies & Notes on Financial Statements

26

The accompanying notes (No. 1 to 26) are an integral part of Financial Statements Under reference to our report of even date. For S. K. Bansal & Co. Chartered Accountants S. K. Bansal Partner Membership No. 013147 FRN. 002222N Place : Chandigarh Dated : August 14, 2012 For and on behalf of the Board Vineet Gupta Whole Time Director Pranav Gupta Managing Director

Vipin Gupta V.P . & C. Secretary

R. C. Goyal Sr. V. P . (Finance)

Parabolic Drugs Ltd.

Consolidated Cash Flow Statement

For the year ended March 31, 2012 (` in million) As at 31.03.2012 As at 31.03.2011

CASH FLOW FROM OPERATING ACTIVITIES (Including WC Changes) - Profit Before Tax - Depreciation & Amortization - Finance Expenses - R & D Expenses Written off - Misc Expenses Written Off - Total Operating Cash flow before WC Changes Working Capital Changes Current Assets - Inventory - Trade Receivable - Loans & Advances & Other Current Assets Increase / (Decrease) in Current Assets Current Liabilities - Trade Payables - Other Current Liabilities & Provisions - Long Term Provisions Increase / (Decrease) in Current Liabilities Net Increase/(Decrease) in Working Capital - Income Tax Total Cash Flow from Operations including WC CASH FLOW FROM INVESTMENT ACTIVITIES - Purchase of Fixed Assets - Minority Interest - Investment in Shares - Preliminary Expenses - R&D Expenditure Total Cash Flow from Investment Activities (B) 1118.23 (1.00) (25.06) 934.92 2027.04 1137.63 25.00 0.08 640.17 1802.88 (A) 1068.78 190.51 9.82 1269.11 (602.95) 132.88 2084.38 894.85 77.62 972.47 1102.73 145.36 23.36 1110.84 (534.02) 89.34 666.16 1005.34 821.07 248.79 2075.20 664.41 100.54 641.37 206.14 1.85 1614.31 686.82 82.61 407.60 92.57 1.85 1271.45

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Consolidated Cash Flow Statement

For the year ended March 31, 2012 (` in million) As at 31.03.2012 As at 31.03.2011

CASH FLOW FROM FINANCING ACTIVITIES - Share Capital/Share Premium - Term Loans Additions / (Repayments) - Unsecured Loans/Deferred Creditors - Increase / (Decrease) in Working Capital Loans - Dividend - Public Issue Expenses - Finance Expenses Total Cash Flow from Financing Activities Net cash inflow/(outflow) (During the Year) Cash Balance in the beginning of the year Cash Balance at the end of the year (C) (A-B+C) 369.70 166.94 173.59 (36.09) (641.37) 32.77 90.06 256.76 346.82 1848.07 113.67 348.77 74.60 (117.69) (407.60) 1859.82 80.30 176.46 256.76

Under reference to our report of even date. For S. K. Bansal & Co. Chartered Accountants S. K. Bansal Partner Membership No. 013147 FRN. 002222N Place : Chandigarh Dated : August 14, 2012 For and on behalf of the Board

Vineet Gupta Whole Time Director

Pranav Gupta Managing Director

Vipin Gupta V.P . & C. Secretary

R. C. Goyal Sr. V. P . (Finance)

Parabolic Drugs Ltd.

Notes on Consolidated Financial Statements for the year ended 31st March, 2012
(` in million) As at 31.03.2012 1 SHARE CAPITAL As at 31.03.2011

Authorised 62000000 Equity Shares (Previous Year 62000000) of Rs. 10 each Issued, Subscribed and Fully Paid Up 61892014 Equity Shares (Previous Year 61892014) of Rs. 10 each fully paid up Total Issued, Subscribed & Fully Paid Up Share Capital 618.92 618.92 618.92 618.92 620.00 620.00

(a) Reconciliation of Number of Shares Outstanding As at 31.03.2012 Number Equity Shares Shares outstanding at the beginning of current reporting period Shares Issued & Subscribed during the Period Shares Bought Back Shares outstanding at the end of current reporting period (b) Terms/ Rights Attached to Equity Shares 61892014 618.92 61892014 61892014 618.92 61892014 Amount Number

(` in million) As at 31.03.2011 Amount 618.92 618.92

The Company has only One Class of Equity Shares having par value of Rs. 10 each. Each holder of Equity share is entitled to one vote per share with a right to receive per share dividend declared by the company. The company declares and pays dividend in Indian rupees.The Dividend proposed by Board of Directors is subject to the approval of the Shareholders in the ensuing Annual General Meeting. In the event of liquidation of the Company, the holder of Equity Shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in the proportion to the number of Equity shares held by the Shareholders. (c) Detail of Shareholders Holding more than 5% Shares in the Company As at 31.03.2012 Number M/s PNG Trading Pvt. Ltd. M/s Parabolic Infrastructure Pvt. Ltd. M/s BTS India Private Equity Fund Ltd. 14171836 5935891 5467484 % Holding 22.90% 9.59% 8.83% Number 13614045 5852462 5467484 As at 31.03.2011 % Holding 22.00% 9.46% 8.83%

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73

Notes on Consolidated Financial Statements for the year ended 31st March, 2012
(` in million) As at 31.03.2012 31.03.2011 2 RESERVE & SURPLUS As at 31.03.2011

Profit and Loss Account At the beginning of the year Add: Net Profit for the Year Less: Appropriations Provision for dividend on equity shares Equity dividend tax At the end of the year Capital Reserve At the beginning and at the end of the year Capital Subsidy At the beginning and at the end of the year Security Premium At the beginning of the year Add: Addition during the Year Less: Public Issue Expenses At the end of the year Net Surplus in the Statement of Profit and Loss 3 LONG TERM BORROWINGS 1291.28 168.05 1459.33 Terms of borrowings are as under: Term Loans from Banks are secured by way 1st pari passu charge on all existing & future fixed assets of the company at all locations with equitable mortgage of land & building, 2nd pari passu charge on all the current assets of the Company and pari passu charge on the collateral properties of M/s. Parabolic Infrastructure P Ltd, M/s. PNG Trading P Ltd & also personally guaranteed by Mrs. Rama Gupta,Mr. J.D.Gupta,Mr T.N Goel, Mr. Pranav Gupta and Mr. Vineet Gupta. 4 DEFERRED TAX LIABILITIES (NET) 921.57 1.11 922.68 1631.18 1631.18 3665.22 157.91 1601.67 (128.40) 1631.18 3171.08 3.00 3.00 0.34 0.34 15.47 2.51 2030.70 30.95 5.14 1536.56 1536.56 512.12 1052.40 520.25

Secured: Term Loans from Banks Unsecured: Due to Others

Deferred Tax Liability Related to Fixed assets 116.94 116.94 97.53 97.53

Parabolic Drugs Ltd.

Notes on Consolidated Financial Statements for the year ended 31st March, 2012
(` in million) As at 31.03.2012 31.03.2011 5 LONG TERM PROVISIONS 14.72 16.16 30.88 6 SHORT TERM BORROWING 9.49 11.56 21.05 As at 31.03.2011

Provision for Employee Benefits-Gratuity Provision for Employee Benefits-Leave Encashment

Secured: Working Capital Loans from Banks: - Cash Credit - Buyer Credit - Packing Credit - FCNR - Bills Discounted Unsecured: Working capital loan from Banks 362.19 3764.55 609.28 3590.96 2,150.29 447.03 547.11 257.93 1,382.56 718.95 340.19 225.78 314.20

Working Capital borrowings from Banks are secured by way of first pari passu charge on hypothecation of entire present & future current assets of the Company, Second pari passu charge on all fixed assets of the Company and pari passu charge on the collateral properties of M/s Parabolic Infrastructure P Ltd, M/s PNG Trading P Ltd & also personally guaranteed by Mrs Rama Gupta, Mr. J.D. Gupta ,Mr T.N Goel, Mr. Pranav Gupta and Mr Vineet Gupta.

TRADE PAYABLES 2674.50 77.88 90.18 2842.56 1649.04 41.82 82.92 1773.78

Sundry Creditors - Materials Sundry Creditors - Expenses Sundry Creditors - Capital Expenses

OTHER CURRENT LIABILITIES 323.36 2.52 0.05 14.76 100.60 56.77 498.06 230.36 0.05 5.72 26.42 41.00 303.55

Current maturities of Long Term Debt Interest accrued but not due on Borrowings Share Application money due for refund Advance from Customers Statutory Liabilities Other Expenses Payable

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75

Notes on Consolidated Financial Statements for the year ended 31st March, 2012
(` in million) As at 31.03.2012 31.03.2011 9 SHORT TERM PROVISIONS 132.88 15.47 2.51 150.86 136.88 30.95 5.14 172.97 As at 31.03.2011

Provision for Income Tax Proposed Dividend on Equity shares Corporate Dividend Tax on Dividend

10

FIXED ASSETS
GROSS BLOCK Rate of Dep. (%) As on 1.4.2011 Addition During the Year Deduction During the Year Total As on 31.3.2012 As on 1.4.2011 DEPRECIATION Provided During the Year Assets As on Sold / 31.3.2012 Written Back / Adjustment NET BLOCK As on 31.3.2012 As on 31.3.2011

Tangible Assets: Land & Site Development Factory Building Non Factory Building Plant & Machinery Furniture & Fixture Tubewell Vehicles Computers & Peripherals Research & Development Fixed Assets 1847.44 Intangible Assets: Computer Software Patents 16.21% 2.67 2.67 2.53 0.15 2.68 5.20 0.15 5.35 0.71 0.71 0.68 0.68 1.39 1.39 3.81 0.15 3.96 1.96 1.96 350.03 3.55 2193.92 219.87 99.86 0.94 318.79 1875.13 1627.57 3.34% 1.63% 5.28% 6.33% 1.63% 9.50% 16.21% 7.80 333.33 6.50 1109.26 18.55 3.18 24.95 9.61 334.26 28.98 295.76 7.46 1.56 4.56 1.70 10.01 3.35 0.20 7.80 362.31 6.50 1405.02 26.01 4.74 26.16 11.31 344.07 24.69 0.87 146.15 3.17 0.18 8.49 4.67 31.65 11.46 0.11 65.94 1.24 0.06 2.50 1.66 16.89 0.94 36.15 0.98 212.09 4.41 0.24 10.05 6.33 48.54 7.80 326.16 5.52 1192.93 21.60 4.50 16.11 4.98 295.53 7.80 308.64 5.63 963.11 15.38 3.00 16.46 4.94 302.61

Capital Work In Progress:

1154.02 1154.02

969.20 969.20

201.07 201.07

1922.15 1922.15

1922.15 1922.15

1154.02 1154.02

TOTAL

3004.13

1321.91

204.62

4121.42

220.58

100.54

0.94

320.18

3801.24

2783.55

Parabolic Drugs Ltd.

Notes on Consolidated Financial Statements for the year ended 31st March, 2012
(` in million) As at 31.03.2012 31.03.2011 11 a. b. NON CURRENT INVESTMENTS Trade Investments: Non Trade Investments: As at 31.03.2011

Investment in equity instruments Nimbua Greenfield (Punjab) Ltd- Unquoted, Fully paid up 18750 Equity shares (PY 25000) of Rs. 10/- each Investment in Mutual funds- Quoted, Fully Paid up SBI - SHF Ultra Short Term Fund Nil units (PY- 1952880.89) of Rs. 10/- each 0.19 25.25 0.19 0.25 25.00

12

OTHER NON CURRENT ASSETS

Other Non Current Assets - Preliminary Expenses - Research & Development Expenses 11.75 1626.17 1637.92 13.49 897.48 910.97

13

INVENTORIES 462.18 4016.08 31.53 7.53 4517.32 392.85 3005.02 1.26 7.35 3406.48

Raw Materials Work in Progress/ Semi Finished Goods Finished Goods Stores and Consumables

Inventory has been valued as per inventory taken, valued and certified by the management on which we have relied upon.

Parabolic Drugs Limited | Annual Report 2011-12

77

Notes on Consolidated Financial Statements for the year ended 31st March, 2012
(` in million) As at 31.03.2012 31.03.2011 14 TRADE RECEIVABLES As at 31.03.2011

(Unsecured, Considered Good) Outstanding for a period of: - More than six Months - Less than six Months Less: Provision for doubtful debts 2217.56 2751.58 469.36 1748.20 168.29 2583.29

15

CASH & CASH EQUIVALENTS 1.27 32.78 312.77 346.82 8.33 11.72 236.71 256.76

Cash in hand and as imprest Balance with Banks - Current accounts - Fixed Deposit accounts

16

SHORT TERM LOANS & ADVANCES 1.08 2.61 24.20 139.20 13.83 46.07 227.35 454.34 3.43 21.96 137.53 23.44 42.01 142.13 370.50

Loans and Advances to Related Parties Loans and Advances to Employees Security Deposits Deposits/Balances with Statutory Authorities Unexpired Expenses Commercial Advances - For Raw materials/ Expenses - For Capital Goods Other Loans and Advances

17

OTHER CURRENTS ASSETS 3.13 170.30 173.43 1.42 166.51 167.93

Interest accrued but not due on Fixed deposits Advances Recoverable in cash or kind or for value to be received

Parabolic Drugs Ltd.

Notes on Consolidated Financial Statements for the year ended 31st March, 2012
(` in million) As at 31.03.2012 31.03.2011 18 REVENUE FROM OPERATIONS 10123.08 80.04 959.68 9243.44 6752.97 38.22 592.75 6198.44 As at 31.03.2011

Gross Revenue from sale of products Other Operating Revenue Less: Excise duty attributable to products sold

19

OTHER INCOME 29.79 10.98 40.77 10.84 142.61 153.45

Interest Income Other non-operating income

20

COST OF MATERIALS CONSUMED

Raw Material Opening Stock Add: Purchases Less: Closing Stock Stores and Spares Opening Stock Add: Purchases Less: Closing Stock 7.35 37.16 7.53 36.98 8004.47 5.55 37.35 7.35 35.55 5410.89 392.85 8036.82 462.18 7967.49 287.13 5481.06 392.85 5375.34

21

(INCREASE)/DECREASE IN INVENTORIES OF FINISHED GOODS, WORK-IN-PROGRESS AND STOCK IN TRADE

Opening Stock: Finished Goods Work in Progress Closing Stock: Finished Goods Work in Progress 31.53 4016.08 4047.61 (1041.33) 1.26 3005.02 3006.28 (897.82) 1.26 3005.02 3006.28 2108.46 2108.46

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79

Notes on Consolidated Financial Statements for the year ended 31st March, 2012
(` in million) As at 31.03.2012 31.03.2011 22 EMPLOYEE BENEFIT EXPENSES 200.41 9.03 15.72 225.16 150.76 6.67 11.87 169.30 As at 31.03.2011

Salary, Wages and other allowances Staff and labour Welfare Expense Contribution to Statutory Funds

23

FINANCE COST 504.82 155.59 (19.04) 641.37 298.53 96.53 12.54 407.60

Interest expense Other Borrowing cost Applicable net loss on foreign currency transactions and translations

24

DEPRECIATION & AMORTISATION EXPENSES 100.54 1.85 206.14 308.53 82.61 1.85 92.57 177.03

Depreciation Miscellaneous Expenditure written off Research and development expenditure written off

25

OTHER EXPENSES 98.06 13.73 2.37 5.71 32.95 24.30 8.59 59.93 0.77 1.26 14.04 1.58 3.58 2.73 60.96 10.32 0.70 5.46 45.29 13.62 10.71 65.23 0.40 1.19 7.26 0.89 2.82 2.17

Water & Electricity charges Repair & maintenance - Machinery - Building - Others Job work charges Generator set expenses Lab expenses Freight & other expenses (inward) Hire charges (nitrogen tank) Travelling & conveyance - Directors (including foreign travelling) - Others (including foreign travelling) Vehicle running & maintenance Printing & stationery Telephone expenses

Parabolic Drugs Ltd.

Notes on Consolidated Financial Statements for the year ended 31st March, 2012
(` in million) As at 31.03.2012 31.03.2011 Postage & telegram Insurance expenses Rate, fees & taxes Legal & professional charges Directors remuneration Office expenses Security charges Auditors' remuneration - Statutory auditor - Internal auditor - Out of pocket expense Charity & donation Director sitting fee Advertisement Office rent Subscription fee Festival expenses Testing charges Newspaper,books & periodicals General repair & maintenance Loss on sale of fixed assets/shares Service charges Insurance expenses (sales) Freight & cartage outward Clearing & forwarding (export) Commission on sale Business promotion Exhibition & fair expenses Rebate & discount Miscellaneous expenses 0.60 0.23 0.01 0.08 0.11 0.35 2.95 0.42 0.17 0.99 0.04 2.78 1.11 0.28 6.57 10.13 32.42 25.60 13.59 0.09 51.36 6.67 481.59 0.45 0.17 0.03 0.61 0.09 0.85 2.18 0.19 0.49 0.51 0.11 2.05 0.57 0.59 5.83 15.85 17.44 17.77 35.74 3.45 24.08 2.93 398.07 2.76 8.98 5.11 10.25 18.00 6.09 4.25 As at 31.03.2011 2.75 8.49 1.72 3.76 15.00 3.98 3.37

Parabolic Drugs Limited | Annual Report 2011-12

81

Notes on Consolidated Financial Statements for the year ended 31st March, 2012

SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS FORMING PART OF BALANCE SHEET AND STATEMENT OF PROFIT & LOSS FOR PERIOD ENDED 31stMARCH, 2012 I.
a.

SIGNIFICANT ACCOUNTING POLICIES:


Accounting Convention The financial statements have been prepared to comply with the Accounting Standards referred to in the Companies (Accounting Standards) Rules 2006 issued by the Central Government in exercise of the power conferred under subsection (1)(a) of section 642 and relevant provisions of the Companies Act, 1956.The Financial statements have been prepared under the historical cost convention on accrual basis. The accounting policies have been consistently applied by the company unless otherwise stated.

b.

Principles of Consolidation i) The consolidated financial statements relate to Parabolic Drugs Limited (the 'Company') and its subsidiaries. The consolidated financial statements have been prepared on the following basis: The financial statements of the company and its subsidiaries have been combined on a line by line basis by adding together the book value of like items of assets, liabilities, income and expenses, after fully eliminating intra group balances and intra group transaction resulting in unrealized profit or losses. The consolidated financial statements have been prepared using uniform accounting policies for like transaction and other event in similar circumstances and are presented to the extent possible in the same manner as in the company separate financial statements.

ii)

The subsidiaries considered in the consolidated financial Statements are:Country Of Incorporation % Age voting Power held as at 31.03.2012 98.33 79.99 % Age voting Power held as at 31.03.2011 98.33 -

Name of Company

Parabolic Research Labs Limited Ziven Lifesciences Limited

India India

c. Other Significant Accounting Policies These are setout in the notes to the financial statements under Significant accounting policies and notes to accounts of the financial statements of the Parabolic Drugs Limited and its subsidiaries.

Parabolic Drugs Ltd.

Notes on Consolidated Financial Statements for the year ended 31st March, 2012
26 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTS: (a) During the year ended 31st March 2012, the Revised Schedule VI notified under the Companies Act, 1956, has become applicable to the company, for preparation and presentation of its financial statements. The adoption of revised schedule VI does not impact recognition and measurement principles followed for preparation for financial statements. However, it has significant impact on presentation and disclosures made in financial statements. The company has also regrouped/ reclassified the previous year figures to correspond with the current year's classification/ disclosure. (b) Debit or Credit Balances on whatever account are subject to confirmation/ reconciliation. (c) The work-in-process / semi finished goods and by product etc. have been grouped as closing stock and the variation is stock has been worked out accordingly. (d) The amount less received from the parties against sales made to them has been charged to Rebate & Discount Account. (e) In the opinion of the Board of Directors, all current assets and loans and advances have a value on realization at least equal to the amount at which they are stated in the Balance Sheet. Adequate provisions have been made for all the known liabilities. (f) The Company has called for the information from its suppliers as regard to disclosure required under Micro, Small and Medium Enterprises Development Act, 2006. The replies from most of the suppliers in this regard are still awaited.

(g) Commission on sales and rebate & discount are accounted for when accounts are finally settled with the agents. (h) Stock of stores and consumables amounting to Rs.7.53 mn comprises spares and others consumable items. The value as estimated and certified by the management has been considered. (i) (j) Fixed Deposit with banks Rs.312.67 mn. (Previous year Rs.236.71 mn.) are pledged as margin money with banks. The total revenue expenditure incurred during the year on Research & Development amounted to Rs. 933.38 mn. have been treated as deferred revenue expenditure and will be written off over the period of 5 years so as to depict the true financial position of the company as per policy of the company followed in preceeding years.

(k) The DEPB Income comprises export benefit against the DEPB Licenses realized from Director Gen. of Foreign Trade, Ministry of commerce, Govt. of India on eligible export made by the company and the gain (i.e. the discount amount and resultant difference between the license value and purchase value) on purchase of DEPB License from exporter for the purpose of payment of Custom Duty on import of raw material by the company. (l) Export Incentive have been accounted on accrual basis.

(m) The Inventory comprises of raw material, stores & spares, packing material, stock of work in progress including recovery stock and material at shop floor as physically verified as on 31st March 2012, valued and certified by the management has been considered. (n) The company has circulated the balance confirmation letters for the balance confirmation from sundry Debtors and Creditors as on 31st March, 2012. However, in the absence of confirmation, the balances have been taken as per records of the company. (o) i) Disclosure in accordance with accounting standard (AS 29) Provisions, Contingent Liabilities and Contingent Assets: (` in million)
Particulars As at 1st April, 2011 Additions during the year Amount paid/ reversed during the year As at 31st March, 2012

Gratuity Leave Encashment ii)

9.49 11.56

5.78 6.52

0.55 1.92

14.72 16.16

Taxation matters in respect of which appeals are pending: Particulars Central Excise Duty # Rs. 0.34 million have been deposited towards disputed liability 2011-12 0.59 #

(` in million) 2010-11 0.59 #

Parabolic Drugs Limited | Annual Report 2011-12

83

Notes on Consolidated Financial Statements for the year ended 31st March, 2012
26 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTS: (p) Taxation i) In order to comply with the requirement of section 211(3c) of the Companies Act, 1956 consequent to Accounting Standard 22 Accounting for Taxes on Income, the company has followed the deferred tax method of accounting. Consequently the company has accounted the deferred tax for the current period amounting to Rs.19.41 Million in the Statement of Profit & Loss. Deferred Tax Asset/ Liability are attributable to the following items: Deferred Tax Asset (Liability) 31.3.2011 (97.53) (97.53) Charge/ Credit (` in million) Deferred Tax Asset (Liability) 31.3.2012 (116.94) (116.94)

ii)

Particulars

Deferred Tax Liability Difference between Tax and Book Written down value of Fixed Assets (19.41) (19.41)

(q) Fixed Assets possessed by PARABOLIC DRUGS LIMITED are treated as Corporate Assets and are not cash generating units as per Accounting Standard-28 issued by the Institute of Chartered Accountants of India. In the opinion of Management there is no impairment of fixed assets of the Company. (r) Employee Benefits: Consequent upon adoption of Accounting Standard on Employee Benefits" (As 15) (Revised 2005), as required by the Standard, the following disclosures are made : (` in million) Reconciliation of opening and closing balances of the present value of the defined benefit obligation Obligation at period beginning Current service Cost Reconciliation of opening and closing balances of the present value Actuarial (gain)/loss Benefits paid Obligation at the year end (March 31, 2012) Changes in plan assets Plan assets at period beginning, at fair value Expected return on plan assets Actuarial gain / (loss) Contributions Benefits paid Plan assets at the year end, at fair value Reconciliation of present value of the obligation and the fair value of plan assets Fair value of plan assets at the end of the year Present value of the defined benefits obligation at the end of the year Liability / (Asset) recognized in the Balance Sheet Cost for the year Current Service Cost 4.64 5.71 Nil 14.72 14.72 Nil 16.16 16.16 (April1, 2011) Leave Encashment (Unfunded) 9.49 4.64 0.77 0.37 -0.55 14.72 N.A. Nil Nil Gratuity (Unfunded) 11.56 5.71 0.94 -0.13 -1.92 16.16 N.A. -

Parabolic Drugs Ltd.

Notes on Consolidated Financial Statements for the year ended 31st March, 2012
26 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTS: Interest Cost Expected return on plan assets Actuarial (gain)/ loss Net Cost recognized in the Profit and Loss Account Assumption used to determine the benefit obligations: Interest rate Estimated rate of return on plan assets Expected rate of increase in salary Actual return on plan assets (s) Earnings Per Share 2012 Profit for the year Weighted average number of Ordinary shares outstanding Add: Dilutive effect of potential ordinary shares Weighted average number of Ordinary shares in computing diluted earning per share Earnings per share on profit for the year (Face value Rs.10/- per share) - Basic - Diluted (t) 8.27 8.27 9.43 9.43 512.12 61892014 61892014 (` in million) 2011 528.73 56086198 56086198 8.60% N.A. 10.00% 8.60% N.A. 10.00% 0.77 0.37 5.78 -0.13 6.52 0.94 -

Related Party Disclosures in accordance with the Accounting Standard-18 as notified by the Companies (Accounting Standard) Rules, 2006 Key Management Personnel with whom transactions have taken place during the Year 1. 2. Shri Pranav Gupta Shri Vineet Gupta Managing Director Whole Time Director

Relatives of Key Management Personnel with whom transactions have taken place during the Year 1. 3. Shri J.D Gupta Smt. Rama Gupta 2. J.D Gupta (HUF) 4. Dr. Deepali Gupta

Subsidiary with whom transactions have taken place during the Year 1. Parabolic Research Lab Limited 2. Ziven Life Sciences Limited

Associates with whom transactions have taken place during the Year 1. 3. 5. PNG Trading Private Limited Vineet Packaging Industries Saj Infrastructure Private Limited 2. Parabolic Infrastructure Private Limited 4. Parabolic Estates Private Limited 6. Trackball Technology Private Limited

Parabolic Drugs Limited | Annual Report 2011-12

85

Notes on Consolidated Financial Statements for the year ended 31st March, 2012
26 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTS: Related Party Transactions Disclosure of transactions between the company and the Related parties and the status of outstanding balances as on 31.03.2012 Nature of Transactions (Excluding Reimbursements) Remuneration to Key Management Personnel Rent Paid Purchase of Fixed Assets Loan & Advances given Loan & Advances taken Share Application Money Purchase of Goods Sale of Goods Salary Investment Balances as on 31st March, 2012 Investments Loans & Advances Loans (Liability) Sundry Creditors Sundry Debtors Note: Figures in Italics represents Previous Year's amount. 35.48 31.48 10.47 Nil 0.11 Nil 161.05 Nil 0.67 0.23 0.97 Subsidiary Associates Key Management Personnel 3.00 Nil 0.11 Nil 161.05 Nil 2.32 1.21 0.97 Nil 18.00 15.00 Relatives of Key Management Personnel 0.76 0.66 1.20 Nil Total

10.47 Nil Nil 1.98 4.00 10.00

18.00 15.00 0.76 0.66 3.00 Nil 10.57 Nil 161.05 Nil Nil 1.98 2.32 1.21 0.97 Nil 1.20 Nil 4.00 10.00

Parabolic Drugs Ltd.

Notes on Consolidated Financial Statements for the year ended 31st March, 2012
26 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTS: (u) The following expenses incurred during the year as attributable to the fixed assets (including Capital Work in Progress) have been capitalized: (` in million) Particulars Salary and Allowances Consultancy Charges Bank Interest/ Processing Fee Power & Fuel Others Amount 10.78 1.34 76.26 35.34 6.30 130.02

(v) The Company has been approved U/s 35 (2AB) of the Income Tax Act, 1961 by the Prescribed Authority i.e. The Secretary, Department of Scientific and Industrial Research, Govt. of India, New Delhi for co-operation in In-house Research and Development facility at Derabassi and Barwala. The exemption from Director General of Income Tax (Exemption) is extended upto 31.3.2015 for Derabassi and up to 31.03.2013 for Barwala unit. (w) The Ministry of Corporate Affairs, Government of India, vide General Circular No. 2 and 3 dated 8th February, 2011 and 21st February, 2011 respectively has granted a general exemption from compliance with section 212 of the Companies Act, 1956, subject to fulfillment of conditions stipulated in the circular. The Company has satisfied the conditions stipulated in the circular and hence is entitled to the exemption. Necessary information relating to the subsidiaries is as under : (` in million) Particulars 2011-12 Parabolic Research Labs Ltd. a) b) c) d) e) f) g) h) i) j) Share Capital Reserves Total Assets Total Liabilities Detail of Investments Turnover Profit before Taxation Provision for Taxation Profit after Taxation Proposed Dividend 30.00 42.10 0.00 Ziven Lifesciences Ltd 5.00 8.89 0.00 2010-11 Parabolic Research Labs Ltd. 30.00 31.99 0.00 Ziven Lifesciences Ltd -

(x) There is a sum of Rs. 0.59 million outstanding on account of excise duty out of which a sum of Rs. 0.34 million has been deposited and balance of Rs. 0.26 million has not been deposited on account of dispute for which appeal is pending. (y) There is an outstanding liability of Rs. 93.2 million on account of income tax for the Ay 2011-12 which has not been deposited on account of assessment proceedings, under process in view of proceedings initiated under section 132 of Income tax act 1961 in the financial year 2010-11. (z) The Ministry of Corporate Affairs, Government of India vide its General Notification No. S.O. 301 (E) dated 8th February, 2011 issued under Section 211 (3) of the Companies Act, 1956 has exempted certain classes of companies from disclosing certain information in their profit and loss account. The Company being an export oriented company is entitled to the exemption. Accordingly, disclosures mandated by paragraphs 3(i) (a), 3(ii)(a), 3 (ii)(b) and 3(ii)(d) of Part II, Schedule VI to the Companies Act, 1956 have not been provided. (za) Additional information pursuant to the provision of paragraph 3 and 4 of Part-II of Schedule-VI of the Companies Act, 1956. [As certified by the Management and accepted by the Auditors] i) Value of Imports during the year (C.I.F Basis) As at 31.03.2012 Raw materials Capital goods 1785.34 54.95 (` in million) As at 31.03.2011 2592.23 22.85

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87

Notes on Consolidated Financial Statements for the year ended 31st March, 2012
26 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTS: ii) Expenditure in Foreign Currency As at 31.03.2012 Salary Consultancy expenses Travelling expenses Commission on sales Fee & Taxes Business promotion expenses R & D Expenses iii) Earnings in Foreign Currency As at 31.03.2012 Export of Goods (F.O.B) 1212.46 10.62 1.61 3.33 14.75 1.89 0.44 (` in million) As at 31.03.2011 1736.17 12.00 1.51 3.40 (` in million) As at 31.03.2011 1.57 2.20

iv)

Dividend remittance in foreign currency As at 31.03.2012

(` in million) As at 31.03.2011 NIL

Amount of Dividend

1.02

(zb) Contingent Liabilities As at 31.03.2012 Letter of Credit (Foreign/ Inland) * Bank Guarantees Custom Duty # 2540.40 29.99 21.70

(` in million) As at 31.03.2011 1451.41 30.81 21.70

* Out of above material valuing Rs. 2413.88 Million (Previous year Rs 1232.21 million) has been received by 31.03.2012 and credited to respective Creditor Account. # The Company has received show clause notices from the Jt. Director General of Foreign Trade towards the non-fulfilment of export obligation against the Advance Licences obtained for import of duty free raw material. Though the company has taken up the matter with appropriate authority for the extension of export obligation period. In this regard the estimated contingent liability is Rs. 21.7 million towards the custom duty. (zc) Segment Reporting: There is not more than one reportable segment. Hence information as per AS-17 is not required to be disclosed.

For and on behalf of the Board

Parabolic Drugs Ltd.

Parabolic Drugs Limited


Registered Office: S.C.O. 99-100, Top Floor, Sector 17 B, Chandigarh-160 017

NOTICE
NOTICE is hereby given that the SIXTEENTH ANNUAL GENERAL MEETING of the Members of the Company will be held on Friday, the 28th day of September, 2012 at 3.00 P .M. at PHD House, Sector 31 A, Chandigarh to transact the following business:-

Ordinary Business:
1. To receive, consider and adopt the Audited Balance Sheet as at 31st March, 2012, the Statement of Profit and Loss for the year ended on that date, together with Report of Auditors and Directors thereon. To declare dividend on Equity Shares. (a) To appoint a Director in place of Mr. Inder Bir Singh Passi, who retires by rotation in accordance with Article 76 of the Articles of Association of the Company and being eligible, offers himself for re-appointment. (b) To appoint a Director in place of Dr. Ram Kumar, who retires by rotation in accordance with Article 76 of the Articles of Association of the Company and being eligible, offers himself for re-appointment. 4. To appoint Auditors for the year 2012-2013 and to fix their remuneration.

2. 3.

Special Business:
5. To consider and if thought fit, to pass with or without modification (s), the following resolution as a Special Resolution: RESOLVED THAT pursuant to the provisions of Section 198, 269, 309, 310 and other applicable provisions, if any, of the Companies Act, 1956, read with Schedule XIII of the said Act and subject to such approvals/ sanctions as may be required, Mr. Gurpreet Singh Sandhu be and is hereby appointed as a Whole Time Director (Business Promotion) of the Company for a period of one year w.e.f. 1st November, 2012 to 31st October, 2013 and Mr. Sandhu shall not be entitled to any salary, commission or perquisites, however, he shall be reimbursed all expenses as may be incurred by him regarding all business promotion activities of the Company. RESOLVED FURTHER THAT the Board of Directors be and is hereby authorised to take all such acts, deeds, matters and things as may be deemed necessary, expedient and proper to give effect to the aforesaid resolution.

By order of the Board

(Vipin Gupta) Vice President & Company Secretary Place: Chandigarh Date: 14th August, 2012

Parabolic Drugs Limited | Annual Report 2011-12

89

NOTES:
1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE ON A POLL INSTEAD OF HIMSELF/HERSELF AND SUCH PROXY NEED NOT BE A MEMBER OF THE COMPANY. THE PROXY, IN ORDER TO BE EFFECTIVE, MUST BE RECEIVED BY THE COMPANY NOT LESS THAN 48 HOURS BEFORE THE MEETING. THE BLANK PROXY FORM IS ENCLOSED. 2. The Information pursuant to Corporate Governance Clause of the Listing Agreement (s) regarding the directors seeking appointment/re-appointment in the Annual General Meeting as proposed in Item No. 3 & 5 of the notice is annexed hereto separately and forms part of the Notice. 3. The Register of Members and the Share Transfer Books of the Company shall remain closed from 21st September, 2012 to 28th September, 2012 (Both days inclusive). 4. Explanatory Statement pursuant to Section 173(2) of the Companies Act, 1956, in respect of Item No. 5 is annexed hereto and forms part of the Notice. 5. The Dividend declared, if any, will be paid to those members whose names appear in the Register of Members of the Company as on the date of Annual General Meeting i.e. 28th September, 2012. However, in respect of the shares held in electronic form, the dividend will be paid on the basis of beneficial ownership as at the closing hour of the 20th September, 2012, as per details to be furnished by Depositories for this purpose. 6. The Members holding shares in physical mode are requested to notify the change in their address, if any, at the earliest to the Registrar & Transfer Agent/Company. However members, holding shares in electronic mode may notify the change in their address, if any, to their respective Depository Participants. 7. Members desiring any information as regards Accounts are requested to write to the Company at its Registered Office at least 10 days before the date of Annual General Meeting so as to enable the management to keep the information ready. 8. The copies of relevant documents can be inspected at the Registered Office of the Company on any working day between 10.30 A.M. to 12.30 P .M. 9. Members are requested to bring their copy of Annual Report along with them to the Annual General Meeting. 10. The Ministry of Corporate Affairs ("MCA") has vide Circular Nos. 17/ 2011 and 18/ 2011 dated 21st April, 2011 and 29th April, 2011 respectively, taken a 'Green Initiative in Corporate Governance' by allowing paperless compliances through electronic mode, allowing to send documents such as Notices convening General Meetings, Audited Financial Statements, Directors' Report, Auditors' Report etc. and any other Notice/Documents, henceforth in electronic form in lieu of paper form. Pursuant of above, the Company is sending the notice of 16th Annual General Meeting and Annual Report of the Company for the Financial Year 2011-12 at the E-mail address of the members whose E-mail address are registered with the Depositories/ RTA/Company. The members whose E-mail address are not registered/updated with the Depositories or the RTA/Company are requested to please register their E-mail address with your Depositories, if they hold the Company's shares in electronic form, under intimation to the Registrar & Transfer Agent through their registered E-mail address. However, if they hold the shares in physical form then they may register their E-mail address with Registrar & Transfer Agent of the Company by sending a letter under their Registered Signature at the below mentioned Address: M/s. Link Intime India Private Limited C-13, Pannalal Silk Mills Compound, L.B.S Marg, Bhandup (West), Mumbai - 400 078 Tel: + (91 22) 2596 3828 Fax: + (91 22) 2594 6969 Email: mumbai@linkintime.co.in Website: www.linkintime.co.in A-40, 2nd Floor, Naraina Industrial Area, Phase-II, Near Batra Banquet Hall, New Delhi - 110 028 Tel: + (91 11) 4141 0592,93,94 Fax: + (91 11) 4141 0591 Email: delhi@linkintime.co.in Website: www.linkintime.co.in

11. Members holding shares in the same/identical name(s) under different folios are requested to apply for consolidation of such folios and send relevant share certificates to the Company/ Registrar and Transfer Agent. By order of the Board (Vipin Gupta) Vice President & Company Secretary Place: Chandigarh Date: 14th August, 2012

Parabolic Drugs Ltd.


INFORMATION PURSUANT TO CORPORATE GOVERNANCE CLAUSE OF THE LISTING AGREEMENT REGARDING THE DIRECTORS SEEKING APPOINTMENT /RE-APPOINTMENT IN THE ANNUAL GENERAL MEETING
Name of the Director Date of Birth Date of Appointment Expertise in specific functional area Qualification Mr. Inder Bir Singh Passi 20th August,1939 12th October,2009 Education M.sc & Ph.D Dr. Ram Kumar 26th January,1946 26th September,200 8 Medical Science specialization of Ophthalmology MBBS Mr. Gurpreet Singh Sandhu 16th March,1965 29th September, 2011 Chemicals, pharmaceuticals & agro commodities B.Sc. (Hons) in Economics, Two MBAs with Specialisation in Marketing Management & International Business Reva Pharmachem Private Limited Akira Pharma Private Limited Akira Developers Private Limited Chairman/Member of Committees of other Companies as on 31st March, 2012. No. of Shares held Nil Nil Nil

Directorships of other Companies as on 31st March, 2012.

Nil

Nil

Nil

15000

11500

ANNEXURE TO THE NOTICE:


EXPLANATORY STATEMENT PURSUANT TO SECTION 173 (2) OF THE COMPANIES ACT, 1956: Item No. 5 of the Special Business: The Board of Directors of the Company in its meeting held on 8th November, 2010 appointed Mr. Gurpreet Singh Sandhu as an Executive Director (Business Promotion) for a period of two years w.e.f.1st November, 2010 to 31st October, 2012. His appointment was also approved by the members in their annual general meeting held on 29th September, 2011. The term of his appointment is going to expire on 31st October, 2012. Keeping in view his active involvement in the business promotion activities of the Company, the Board of Directors of the Company in its meeting held on 14th August, 2012 recommended the appointment of Mr. Gurpreet Singh Sandhu as a Whole Time Director (Business Promotion) for a period of one year w.e.f.1st November, 2012 to 31st October, 2013 on the terms and conditions as mentioned in the proposed resolution for the approval of members in this Annual General Meeting. The above said resolution be also considered as an abstract of the terms of the Contract under Section 302 of the Companies Act, 1956. Memorandum of Interest: Except Mr. Gurpreet Singh Sandhu, the appointee himself, none of the Directors of the Company is, in any way, concerned or interested in this resolution. By order of the Board

Place: Chandigarh Date: 14th August, 2012

(Vipin Gupta) Vice President & Company Secretary

Parabolic Drugs Limited


Registered Office: S.C.O. 99-100, Top Floor, Sector 17 B, Chandigarh-160 017

PROXY FORM
I/We ........................................................................................................................................................................................................ of ............................................................................................................................................................................................................ in the District ............................................................................................................................................. being a Member/Members of Parabolic Drugs Limited, hereby appoint ......................................................................................................................................... of ..................................................................................................... in the ........................................................................................... District of .................................................................................... failing him/her .................................................................................. of ...................................................................................... in the district of .......................................................................................... as my/our proxy to vote for me/us on my/our behalf at the 16th Annual General Meeting of the Company to be held on Friday, the 28th day of September, 2012 at 3.00 P .M. and at any adjournment thereof. Signed this ..................................... Day of .....................................2012. Address .................................................................................................... Folio No./Client ID No. ........................................................................... DP ID No. ................................................................................................. NOTES: 1. A member entitled to attend and vote is entitled to appoint a proxy to attend and vote on poll instead of himself/herself. 2. The Proxy form duly signed across Revenue Stamp of Rupee One should reach the Companys Registered Office at least 48 hours before the time of meeting.
Affix Rupee One Stamp Signature ...................................................................... here

Parabolic Drugs Limited


Registered Office: S.C.O. 99-100, Top Floor, Sector 17 B, Chandigarh-160 017

ATTENDANCE SLIP
I hereby record my presence at the 16th Annual General Meeting of the above named Company being held at PHD House, Sector 31 A, Chandigarh at 3.00 P .M. on Friday, and the 28th day of September, 2012.

Full Name of the Member (In BLOCK LETTERS) Folio No./Client ID No. .....................................................

Signature

No. of Shares held ............................... ......................

Full Name of the Proxy (In BLOCK LETTERS)

Signature

NOTE: Members attending the meeting in person or by proxy are requested to complete the attendance slip and hand it over at the entrance of the meeting hall of the Company

Corporate Information
Board of Directors:
Mr. Inder Bir Singh Passi - Chairman Mr. Pranav Gupta - Managing Director Mr. Vineet Gupta - Whole -Time Director Mr. Gurpreet Singh Sandhu - Whole Time Director (Business Promotion) Mr. Arun Mathur - Director Dr. Ram Kumar - Director Mr. Manmohan Lal Sarin - Director Mr. Nikhil Goel - Director Mr. Koppisetty Srinivas - Nominee Director (M/s. BTS India Private Equity Fund Limited)

Auditors:
M/s. S.K. Bansal & Co., Chartered Accountants, Kothi No.3193,Sector 28 D, Chandigarh

Registered Office:
S.C.O. 99-100, Top Floor, Sector 17 B, Chandigarh Website : www.parabolicdrugs.com

Corporate Office:
9AB, Second Floor, Taimoor Nagar, New Friends Colony, New Delhi

President (Technical)
Mr. Yatish Kumar Bansal

Works:
Village : Sundhran, P .O. : Mubarakpur, Tehsil : Derabassi, Distt.: Mohali (Punjab) Plot No.45, Industrial Area, Phase - II, Panchkula (Haryana) Village : Chachrauli, Tehsil : Derabassi, Distt.: Mohali (Punjab)

Senior Vice - President (Finance)


Mr. R.C. Goyal

Vice - President (Business Finance)


Mr. Sameer Madan

Vice - President & Company Secretary


Mr. Vipin Gupta

R&D Centre:
Plot No. 280-281, Phase - I, Block - 1, Alipur, Industrial Estates, HSIIDC, Tehsil : Barwala, Distt.: Panchkula (Haryana)

Bankers:
State Bank of India (Specialised Commercial Branch) S.C.O.103-106, Bank Square, Sector 17 B, Chandigarh ICICI Bank Limited S.C.O. 129-130, Madhya Marg, Sector 9, Chandigarh UCO Bank S.C.O. 55-57, Bank Square, Sector 17 B, Chandigarh State Bank of Patiala S.C.O. 103-107, Sector 8 C, Chandigarh Union Bank of India 4/14-A, Asaf Ali Road, New Delhi Central Bank of India S.C.O. 58-59, Bank Square, Sector 17 B, Chandigarh Bank of Baroda S.C.O. 62-63, Bank Square, Sector 17 B, Chandigarh IDBI Bank Limited S.C.O. 72-73, Bank Square, Sector 17 B, Chandigarh Canara Bank S.C.O. 117-119, Sector 17 C, Chandigarh Export-Import Bank of India First Floor, PHD House, Sector 31 A, Dakshin Marg, Chandigarh State Bank of Hyderabad S.C.O. 62-63, Sector 34 A, Chandigarh

Sales Depot:
Parabolic Drugs Limited Godown No.11, Baldev Estate, Opp. M.P . Pandya High School, Jetpur (Aslali) Ahmedabad (Gujarat) Parabolic Drugs Limited Unit No. B-116, Shree Raj Laxmi Commercial Complex, Agra Road, Kalher Village : Bhiwandi, Distt.: Thane (Maharashtra) Parabolic Drugs Limited Safex Cargo Complex, Village Kishanpura Nalagarh Road, Baddi, Distt.: Solan (H.P) Parabolic Drugs Limited (Formulations Warehouse) 35 Feet Road, Near Cipla Warehouse, Zirakpur, Distt.: Mohali (Punjab)

Design & Printed at : Azad Hind Stores (P) Ltd.; SCO 34, 17-E, Chd.

www.parabolicdrugs.com

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