Attachment 1

Given Address

8-2-351/W/3A, Plot No.3, Banjara Hills, Hyderabad-500034, Andhra Pradesh, India

Report on	venkat pharma limited
Registered Office	8-2-351/W/3A, Plot No.3, Banjara Hills, Hyderabad-500034, Andhra Pradesh, India
Tel. No.	91-40-23355399
Fax No.	91-40-23355388
E-Mail	vpl@satyam.net.in
Website	http://www.venkatpharmaltd.com
Telex	--

Attachment 2

SUMMARY

Incorporated	1989	Status	Moderate
Registration No.	10272	Chief Executive	Mr. Sri Saila Babu
Capital (Rs.)	35.000 millions	Payments	Slow but correct
Sales (Rs.)	518.300 millions	Litigation	Clear
Net Worth (Rs.)	42.500 millions	Banking Reputation	Unknown
No. of Employees	200	Auditors	J. Kamalakar and Associates
SCORE	B

26-40

B

Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively limited or considered not known. Capability to pay both interest and principal sums is doubtful

Small

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

Line of Business :

Manufacturer of Pharmaceutical Finished Doses, Active Pharmaceutical Ingredients (APIs), Pharmaceutical Formulation Intermediates (PFIs) and Nutraceuticals or Dietary Supplements.

INDUSTRY

************************

FACTORY

Not Applicable

HISTORY

Subject was incorporated in the year 1989 at Hyderabad in Andhra Pradesh having Company Registration Number 10272.

Subject meticulously manufactures pharma products, and constantly improvise existing product mix, thereby carving out a niche for themselves, in the Global playing field of Pharma. They are a public limited company registered under the Indian Companies Act 1956 and their stock is listed in Bombay Stock Exchange (BSE) and is being actively traded.

Subject is solely into the manufacturing and export of Pharmaceutical Products since its inception with an unswerving dedication.

It’s philosophy is to provide value priced and quality Pharmaceutical Products to the humankind at large. Subject’s growth rate is quite above the industry CAGR growth rates -we are growing at a rate of 35% year on year.

Milestones

v Floated as a Private Limited Company in 1989.

v Started manufacturing & sales of Pharma products in 1992.

v Entered International Market in 1994.

v Became Public Ltd company in 1995.

v Issued an IPO in 1996.

v Listing in Bombay Stock Exchange in 1997.

v International market expansion via Product Registration Year 2000.

v Started APIs manufacturing in 2001

v Strengthening of bottom line by trimming down less profitable products & markets in 2002.

v Expansions initiated in Regulated Markets

LEGAL FORM

Subject is a closely held public limited liability company.

DIRECTORS

Mr. Sri Saila Babu	Managing Director
Mr. Ramesh Babu	Director
Mr. Suguna Devi	Director

BUSINESS

Subject acts as a manufacturer of Pharmaceutical Finished Doses, Active Pharmaceutical Ingredients (APIs), Pharmaceutical Formulation Intermediates (PFIs) and Nutraceuticals or Dietary Supplements.

It strongly believes in adopting latest technologies in the manufacturing process thereby giving their customer the best quality product at the best price.

World Market Spread:

Subject presently covers about 16 diverse countries. Their vision of providing quality and value priced Pharmaceutical Products has earned much accolades and helped them gain the confidence of their business partners all across the globe. Its products are irreplaceable in all of core markets due to their sheer quality and competitive pricing advantage. All its products are always re-invented and are made to meet specific requirements of each market by R&D team.

Infrastructure:

Subject’s manufacturing facilities follow the latest guidelines laid down by various regulatory bodies and are periodically upgraded as per cGMP & ISO 9001: 2000 standards.

In all its manufacturing plants subject is equipped with the latest pharmaceutical manufacturing and analytical equipment. All its plants are versatile in nature and it follow the laid out protocols.

Subject employs around 200 persons in its set up.

SISTER CONCERNS

Nil

BANKERS

No Information available

AUDITORS

v J. Kamalakar and Associates

Chartered Accountants

FINANCIAL INFORMATION

The company's latest financial information for the period ended 31^st March, 2002 is enclosed herewith.

The company’s summarised financial Results as on 30.06.2003 were as under:

Particulars	30.06.2003 [15 months]
Sales Turnover	517.400
Other Income	0.800
Total Income	518.200
Total Expenditure	500.600
Operating Profit	17.600
Interest	0.200
Gross Profit	17.400
Depreciation	3.400
Tax	1.900
Reported PAT	12.100

The company’s summarised financial Results as on 31.03.2004 were as under:

Particulars	31.3.2004 [9 months]
Sales Turnover	478.300
Other Income	0.100
Total Income	478.400
Total Expenditure	468.900
Operating Profit	9.500
Interest	4.300
Gross Profit	5.200
Depreciation	1.800
Tax	1.800
Reported PAT	1.900

The company’s Quarterly Results from 01.04.2004 to 31.12.2004 were as under:

Particulars	01.04.2004 To 30.06.2004 (1^st Quarter)	01.07.2004 To 30.09.2004 (2^nd Quarter)	01.10.2004 To 31.12.2004 (3^rd Quarter)
Sales Turnover	60.100	112.800	72.900
Other Income	0.000	0.000	0.000
Total Income	60.100	112.800	72.900
Total Expenditure	56.100	108.300	62.500
Operating Profit	4.000	4.500	10.400
Interest	1.800	1.700	4.800
Gross Profit	2.200	2.800	5.600
Depreciation	0.700	0.700	0.500
Tax	0.500	0.700	0.500
Reported PAT	1.000	1.400	4.600

2004-06 1^st QTR

Expenditure includes Consumption of Raw Material Rs 45.850 million Staff Cost Rs 1.088 million Other expenditure Rs 9.126 million

2004-09 2^nd QTR

Expenditure Includes Consumption of Raw Materials Rs 91.050 million Staff Cost Rs 1.833 million Other Expenditure Rs 15.524 million

2004-12 3^rd QTR

Expenditure Includes Consumption of Raw Materials Rs 45.524 million Staff Cost Rs 1.153 million Other Expenditure Rs 15.805 million

Note : Registrar of Companies details are those which have been filed by the subject or its agents. In certain circumstances, this data may not be upto date and reference should be made to general information details for possible changes not yet filed at the R.O.C. In circumstances, beyond our control R. O. C. data retrieval errors may result in incomplete data being available.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.43.74
UK Pound	1	Rs.82.09
Euro	1	Rs.56.01

CAPITAL STRUCTURE

Authorised Capital :
	No information available
Issued, Subscribed & Paid-up Capital :
	No information available

COMMENTS

Subject is an established company having moderate track records. Profit margin is under severe pressure. Payments are reported as slow but correct.

The company can be considered for small to mediocre business dealings at usual trade terms and conditions.

ABRIDGED BALANCE SHEET AS ON 31^ST March, 2002

[figures are in Rupees Millions]

SOURCES OF FUNDS	31.03.2002	31.03.2001
SHAREHOLDERS FUNDS
1] Share Capital	35.000	35.000
2] Reserves & Surplus	7.500	4.200
Total	42.500	39.200
LOAN FUNDS
1] Secured Loans	18.100	18.800
2] Unsecured Loans	1.500	2.100
GRAND TOTAL	62.100	60.100
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]	18.000	19.100
Capital work-in-progress	0.000	0.000
INVESTMENTS	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
Inventories	8.400	10.400
Sundry Debtors	267.800	288.500
Cash & Bank Balances	0.600	0.700
Loans & Advances	3.200	8.900
Total Current Assets	280.000	308.500
Less :
Current Liabilities	236.600	268.400
Provisions	0.500	0.500
Net Current Assets	42.900	39.600
MISCELLANEOUS EXPENSES	1.200	1.400
GRAND TOTAL	62.100	60.100

IMPORTANT FINANCIAL INFORMATION FOR LAST Two PERIODS

[figures are in Rupees Millions]

PARTICULARS	31.03.2002	31.03.2001
Sales Turnover	518.300	420.000
[including other income]
Profit/(Loss) Before Tax	3.800	0.600
Provision for Taxation	0.500	0.300
Profit/(Loss) After Tax	3.300	0.300
Dividend	--	--
Expenditures :
Raw Materials	412.200	371.000
Excise Duty	0.000	0.000
Power & Fuel Cost	0.600	0.400
Other Manufacturing Expenses	1.400	0.600
Employee Cost	9.600	2.300
Selling and Administration Expenses	86.800	41.300
Miscellaneous Expenses	0.500	0.200
Interest & Financial charges	0.500	0.800
Depreciation	2.900	2.800
Total Expenditures	514.500	419.400

important key ratios for two periods

PARTICULARS	31.03.2002	31.03.2001
Debt Equity Ratio	0.50	0.53
Long Term Debt Equity Ratio	0.06	0.08
Current Ratio	1.09	1.08
TURNOVER RATIOS
Fixed Assets	15.54	12.82
Inventory	55.21	40.08
Debtors	1.87	1.44
Interest Cover Ratio	8.60	1.75
Operating Profit Margin (%)	1.39	1.01
Profit Before Interest and Tax Margin (%)	0.83	0.34
Cash Profit Margin (%)	1.19	0.74
Adjusted Net Profit Margin (%)	0.64	0.07
Return on Capital Employed (%)	7.19	2.39
Return on Net Worth (%)	8.08	0.77

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	5
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	4
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	4
--PROFITABILITY	1~10	4
--LIQUIDITY	1~10	4
--LEVERAGE	1~10	4
--RESERVES	1~10	3
--CREDIT LINES	1~10	4
--MARGINS	-1~5	--
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	YES
--AFFILIATION	YES/NO	NO
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		37

Attachment 3

ACKNOWLEDGEMENT

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