MIRA
INFORM REPORT
|
Report Date : |
08.12.2008 |
IDENTIFICATION
DETAILS
|
Name : |
STRIDES ARCOLAB LIMITED |
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Registered Office : |
201, Devavrata Sector 17,
Vashi, Navi Mumbai – 400 705, Maharashtra |
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Country : |
India |
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Financials (as on) : |
31.12.2007 |
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Date of Incorporation : |
28.06.1990 |
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Com. Reg. No.: |
11-57062 |
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CIN No.: [Company Identification No.] |
L24230MH1990PLC057062 |
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TAN No.: [Tax Deduction & Collection Account No.] |
MUMS36534B |
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PAN No.: [Permanent Account No.] |
AADCS8104P |
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Legal Form : |
Public Limited Liability company. The company’s Shares are
listed on the Stock Exchanges. |
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Line of Business : |
Manufacturing and marketing of all types of Bulk Drugs,
Pharmaceuticals, etc. |
RATING
& COMMENTS
|
MIRA’s Rating : |
A |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
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Maximum Credit Limit : |
USD 13000000 |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is a well-established and reputed company having satisfactory
track. Directors are reported as experienced and respectable businessmen.
Trade relations are reported as fair. Business is active. Payments are
usually correct and as per commitments. The company can be considered normal for business dealings
at usual trade terms and conditions. |
LOCATIONS
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Registered Office : |
201, Devavrata Sector 17,
Vashi, Navi Mumbai – 400 705, Maharashtra, India |
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Tel. No.: |
91-22-27895247 |
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Fax No.: |
91-22-27892924 |
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E-Mail : |
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Website : |
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Corporate Office : |
Strides House, Bilekahalli, Bannerghatta Road, Bangalore –
560 076, Karnataka, India |
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Tel. No.: |
91-80-26581343 / 44 / 57580738
/ 39 / 57580000 / 66580751 / 66580000 / 66580600 |
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Fax No.: |
91-80-26583538/ 4330 / 57580700
/ 800 / 66580800 |
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E-Mail : |
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Factory : |
Soft Gelatin Capsules ‘KRS Gardens’, Suragajakanahalli,
Anekal Taluk, Bangalore-560106, Karnataka Contract Research and Manufacturing 120 A and B, Baikampady, New
Mangalore-575011, Karnataka Strides Incorporation 37, Veronica Avenue, Somerset
NJ 08873, New Jersey-08873, USA Tablets and Hard Gelatin Capsules ‘KRS Gardens’,
Suragajakanahalli, Anekal Taluk, Bangalore-560106, Karnataka Caryl Laboratories Limited 238, Sarakki,
Bangalore-560078, Karnataka Solara SA De CV AV. Paseo De Las Palmas 330-Planta
Baja Lomas De Chapultepec, C.P. 11000, Mexico D.F. Sterile Product Bilekahalli, Bannerghatta
Road, Bangalore-560076, Karnataka Antibiotics Bilekahalli, Bannerghatta
Road, Bangalore-560076, Karnataka Global Remedies Limited 124, Sipcot Industrial
Complex, Hosur-635126, Tamilnadu Infabra Industria Farmaceutica Limited. AV, Das America 8445, Room
801-804, Barra Tower-Barra Da Tijuca, Rio de Janaarrio, RJ 22793-080, Brazil Tel: 00 55 21 24876305 Fax: 00 55 21 24876309 |
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Warehouse : |
Plot No. 62, Sector – 1, Nerul, Navi Mumbai – 400 706,
Maharashtra, India |
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Overseas
Offices : |
Located at :
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DIRECTORS
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Name : |
Mr. Deepak Vaidya |
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Designation : |
Chairman (Non-Executive) |
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Name : |
Mr. Arun Kumar |
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Designation : |
Executive Vice Chairman and Managing Director (Executive &
Promoter) |
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Qualification |
B.Com., PGDBM |
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Date
of Joining |
June 1990 |
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Previous
Employment |
British Pharmaceutical
Laboratories |
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Name : |
Mr. K.R. Ravishankar |
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Designation : |
Executive Director (Executive and Promoter) |
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Qualification |
B.Sc. (Part) |
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Date
of Joining |
June, 1990 |
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Previous
Employment |
Enterpreneur |
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Name : |
Mr. R.S. Prasad |
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Designation : |
Executive Director and Chief Executive Officer (Executive) - since resigned |
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Name : |
Mr. Virtanes Saatci |
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Designation : |
Director (Non-Executive) |
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Name : |
Dr. Francis J. Pinto |
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Designation : |
Director (Non-Executive) |
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Name : |
Dr. Ronald Ling |
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Designation : |
Director (Non-Executive) |
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Name : |
Mr. Elcemar Almeida |
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Designation : |
Director (Non-Executive) |
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Name : |
Mr. D.G. Prasad |
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Designation : |
Director (Non-Executive and Independent) representing Export Import Bank of India as Lender |
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Name : |
Mr. M.R. Umarji |
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Designation : |
Director (Non-Executive and Independent) |
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Name : |
Mr. A.K. Nair |
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Designation : |
Director (Non-Executive and Independent) |
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Name : |
Mr. P.M. Thampi |
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Designation : |
Director (Non-Executive and Independent) |
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Audit Committee: |
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Mr. M.R. Umarji |
Chairman and Member |
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Mr. D.G. Prasad |
Member |
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Mr. A.K. Nair |
Member |
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Mr. P.M. Thampi |
Member |
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Mr. Deepak Vaidya |
Member |
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Dr. Ronald Ling |
Member |
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Shareholders'/Investors' Grievances Committee: |
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Mr. Deepak Vaidya |
Chairman and Member |
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Mr. M.R. Umarji |
Member |
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Mr. K.R. Ravishankar |
Member |
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Remuneration Committee |
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Mr. Deepak Vaidya |
Chairman and Member |
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Mr. Virtanes Saatci |
Member |
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Mr. M.R. Umarji |
Member |
KEY
EXECUTIVES
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Name : |
Mr. V S Iyer |
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Designation : |
Chief Operating Officer |
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Name : |
Mr. Ravi Seth |
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Designation : |
Group Chief Financial Officer |
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Name : |
Mr. S A Manikandan |
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Designation : |
Chief Executive Officer – Brands |
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Name : |
Mr.
Paul Moore |
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Designation : |
Regional Director – Europe |
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Name : |
Mr. V Madhusudhan |
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Designation : |
President – Brazil Operation |
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Name : |
Mr. Mohan Ram Prasad |
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Designation : |
Chief Operating Officer – US Operations |
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Name : |
Mr. Mark Bisset |
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Designation : |
Chief Executive Officer – Australia and Regional Director Asia Pacific Operation |
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Name : |
Mr. Sridhar S Rao |
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Designation : |
Vice President – QA |
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Name : |
Mr. Anil Gupta |
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Designation : |
President – Global Manufacturing |
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Name : |
Mr. M S Mohan |
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Designation : |
Chief Scientific Officer |
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Name : |
Mr. T S Rangan |
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Designation : |
Group Chief Financial Officer |
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Name : |
Mr. Adam Levitt |
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Designation : |
Chief Executive Officer -
North America Operations |
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Name : |
Mr. Mark Bisset |
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Designation : |
Chief Executive Officer and
Regional Director - Asia |
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Name : |
Mr. V. Madhusudhan |
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Designation : |
Chief Executive Officer - Cellofarm
and Regional Director - Latin American Operations |
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Name : |
Mr. Sridhar S. Rao |
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Designation : |
President - QA |
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Name : |
Ms. Aloka Sengupta |
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Designation : |
President - Business Development India
Operations |
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Mr. Mohan Ram Prasad |
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Designation : |
President - Technical Services Latin American Operations |
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Name : |
Mr. Kannan. N |
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Designation : |
Company Secretary |
MAJOR SHAREHOLDERS
/ SHAREHOLDING PATTERN
(As on 30.09.2008)
|
Names of Shareholders |
No. of Shares |
Percentage of
Holding |
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Indian |
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Individuals/ Hindu Undivided
Family |
3665376 |
9.15 |
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Bodies Corporate |
5756625 |
14.37 |
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Public shareholding |
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Institutions |
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Mutual Funds/ UTI |
1688253 |
4.22 |
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Financial Institutions / Banks |
37412 |
0.09 |
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Foreign Institutional Investors |
6732541 |
16.81 |
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Foreign Venture Capital Investors |
12452557 |
31.09 |
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Non-institutions |
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Bodies Corporate |
689900 |
1.72 |
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Individuals |
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Individuals -i. Individual shareholders holding nominal
share capital up to Rs 0.100 Million |
1816164 |
4.53 |
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ii. Individual shareholders holding nominal share capital in excess of Rs. 0.100
Million |
740471 |
1.85 |
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Any Other (specify) |
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Foreign companies |
6470715 |
16.16 |
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Total |
40050014 |
100.00 |
BUSINESS
DETAILS
|
Line of Business : |
Manufacturing and marketing of all types of Bulk Drugs,
Pharmaceuticals, etc. |
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Products : |
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PRODUCTION STATUS
(As on
31.12.2007)
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Particulars |
Unit |
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Installed Capacity |
Actual Production |
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Soft Gelatin Plant Softgel Capsules |
Numbers
in Millions |
|
2645 |
-- |
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Hard Gelatin Plant Capsules |
Numbers
in Millions |
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450 |
-- |
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Tablet Plant Tablets |
Numbers
in Millions |
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2160 |
-- |
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Beta-lactam Plant Capsules and Tablets Dry Powder Vials |
Numbers
in Millions |
|
350 20 |
-- -- |
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Sterile Products Ampoules Vials Prefilled Syringes |
Numbers
in Millions |
|
48 48 7.5 |
-- -- -- |
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Tablets |
(in
000’s) |
|
-- |
1301321 |
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Capsules |
(in
000’s) |
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-- |
753635 |
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Injectables |
(in
000’s) |
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-- |
49485 |
GENERAL
INFORMATION
|
Suppliers : |
·
Foils Pack ·
Global Printing and Packaging Company Private Limited ·
Nice Pack ·
Nice Prints ·
Noble Printing Press ·
Reliance Packaging ·
Industries ·
Sri Krishna Timber Depot ·
Yuno Packaging Private Limited ·
Shree PLA Industries |
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No. of Employees : |
800 |
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Bankers : |
·
Dena Bank, Navi Mumbai, Maharashtra ·
State Bank of India, Navi Mumbai, Maharashtra ·
Corporation Bank, Navi Mumbai, Maharashtra ·
The South Indian Bank, Navi Mumbai, Maharashtra ·
Corporation Bank, Navi Mumbai, Maharashtra ·
Canara Bank, Navi Mumbai, Maharashtra ·
Industrial Development Bank of India, Navi Mumbai,
Maharashtra |
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Facilities
: |
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Banking
Relations : |
Satisfactory |
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Auditors : |
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Name
: |
Deloitte Haskins and Sells Chartered Accountants |
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Address
: |
70/3, Miller Road, Bangalore-560052, Karnataka |
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Memberships : |
Confederation of Indian Industry |
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Wholly owned Subsidiaries: |
·
Global Remedies Limited, India ·
Quantum Life Sciences Private Limited, India ·
Sequent Scientific Limited, India upto November 26, 2007 (Disposed in
current year) ·
Medgene Pharmaceuticals Private •, India ·
Arcolab SA - Switzerland. ·
Strides Africa Limited – British Virgin Islands ·
Strides Arcolab International Limited, U.K, (SAIL) ·
Strides Singapore Pte Limited,Singapore (Wholly owned subsidiary of
SAIL) ·
Drug Houses of Australia ( Asia) Pte Limited, Singapore (Wholly owned
subsidiary of Strides Singapore Pte. Limited ) ·
Strides Polska sp.z o.o, Poland, a Wholly owned subsidiary of SAIL,
(Merged with Strides Arcolab Polska sp.z o.o during the current year) ·
Strides Arcolab Polska sp.z o.o, Poland, (Wholly owned subsidiary of
SAIL) ·
Strides Arcolab UK Limited, UK (Wholly owned subsidiary of SAIL) ·
Starsmore Limited, Cyprus ·
Lakerose Limited,Cyprus (Wholly owned subsidiary of Starsmore Limited) ·
Linkace Limited,Cyprus (Wholly owned subsidiary of Starsmore Limited) ·
Strides Arcolab Hong Kong Limited, Hongkong (Wholly owned subsidiary
of SAIL) ·
Strides Arcolab Malaysia SDN. BHD, Malaysia (Wholly owned subsidiary
of SAIL) ·
Strides Latina, SA , Uruguay (33% held through Lakerose Limited and
balance 67% held through Strides Arcolab Limited) ·
Cellofarm Ltda., Brazil (Wholly owned subsidiary of Lakerose Limited) ·
Solara SA De CV , Mexico (Wholly owned subsidiary of Strides Latina,
SA) ·
Strides Australia Pty Limited, Australia (Wholly owned subsidiary of
SAIL) ·
Strides Italia s.r.l., Italy (Wholly owned subsidiary of SAIL) ·
Strides Arcolab SDN. BHD., Brunei (Wholly owned subsidiary of SAIL) |
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Other Subsidiaries : |
·
Strides S.A. Pharmaceuticals Pty Limited South Africa ·
Strides Inc.USA 37, Veronica Avenue, Somerset NJ 08873, New Jersey, USA. Fax: 00 1 732 249
0225 Website: www.stridesusa.com E-mail: info@stridesusa.com ·
Pharma Strides Canada Corporation, Canada (Wholly Owned Subsidiary of
Strides, Inc.USA) ·
Beltapharm S.p.A, Italy (Subsidiary of SAIL) ·
Grandix Pharmaceuticals Limited, India ·
Onco Therapies Limited, India ·
Grandix Laboratories Limited, India (Subsidiary of Grandix
Pharmaceuticals Limited) ·
Co Pharma, UK (Interest held through Linkace Limited and SAIL) ·
Strides Vital Nigeria Limited, Nigeria (Subsidiary of Strides Africa
Limited) ·
Casa de Representaciones Sumifarma CA, Venezuela (Subsidiary of
Strides Latina, SA) ·
Formule Naturelle (Pty) Limited, South Africa, [formerly known as
Aspen Public Health (Pty) Limited (Subsidiary of Linkace Limited) ·
Strides Arcolab (FA)
Limited BP 1834, Rue Dubois de Saligny Akwa,
Douala, Cameroon Tel
(Office): (+237)343 0435 Mobile :(+237) 79 33
762 Fax
:
(+237) 343 6420 Website: www.stridesarco.com ·
Strides Arcolab Nig. Limited No. 28 Ajasa Street, Gr. Floor, Onikan,
Lagos - Nigeria |
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Joint Venture : |
·
Akorn Strides LLC, USA ·
Laboratorios Domac, Spain ·
Plus Farma ehf., Iceland ·
Farma Plus AS, Norway (Wholly owned subsidiary of Plus Farma ehf,
Iceland) ·
Powercliff Limited, Cyprus ·
Sagent Strides LLC, USA |
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Associates : |
·
Albatross, an Associate of Plus Farma (a step down joint venture of
the Company) ·
Arcolab India Private Limited ·
Keerthapathi Ravishankar- HUF ·
Mrs. Deepa Arunkumar ·
Mrs. K.Saraswathi ·
Vedic Elements Private Limited ·
Net Equity Ventures Private Limited ·
Agnus Holdings Private Limited ·
Strides Technical Services Limited ·
Nous Infosystems Private Limited ·
Everron Systems (India) Limited ·
Chayadeep Properties Private Limited |
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|
Enterprises owned or significantly Influenced by key management personnel and
relatives of key management personnel : |
·
Arcolab India Private Limited ·
Keerthapathi Ravishankar – HUF ·
Mrs.Deepa Arunkumar ·
Mrs.K.Saraswathi ·
Vedic Elements Private Limited ·
Net Equity Ventures Private Limited ·
Agnus Holdings Private Limited ·
Nous Infosystems Private Limited ·
Everron Systems (India) Limited ·
Chayadeep Properties Private Limited ·
Patsys Consulting Private Limited ·
Xlensea Products Private Limited ·
Caryl Pharma Private Limited ·
Fraxis Life Sciences Limited ·
PI Drugs and Pharmaceuticals Limited ·
Atma Projects ·
Sequent Scientific Limited, India w.e.f November 26, 2007 |
CAPITAL
STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
70000000 |
Equity Shares |
Rs.10/- each |
Rs.700.000 Millions |
|
620000 |
Cumulative Redeemable Preference Shares |
Rs.1000/- each |
Rs.620.000 Millions |
|
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Total
|
|
Rs.1320.000
Millions |
Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
35004289 |
Equity Shares |
Rs.10/- each |
Rs.350.040
Millions |
|
|
·
318875 (Previous year 3068875) equity shares of Rs.10 each were
allotted to the Promoters and their associate companies on exercising of the
Warrants. ·
210955 equity shares of Rs.10 each were allotted to the erstwhile
share holders of Bombay Drugs and Pharmas Limited consequent to amalgamation
with the Company ·
1251000 equity shares of Rs.10 each were issued as bonus shares by
capitalisation of General Reserve ·
1912500 equity shares of Rs.10 each were issued consequent to
amalgamation to the shareholders of erstwhile Remed Laboratories (India)
Limited and Plama Laboratories Limited |
|
|
|
491606 |
6% cumulative redeemable preference shares |
Rs.1000/-
each |
Rs.491.610
Millions |
|
|
|
|
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Total |
|
Rs.841.650 Millions |
FINANCIAL
DATA
[all figures are in Rupees Millions]
ABRIDGED
BALANCE SHEET
|
SOURCES OF FUNDS |
31.12.2007 |
31.12.2006 |
31.12.2005 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
841.650 |
841.150 |
841.100 |
|
|
2] Share Application Money |
189.870 |
354.310 |
0.000 |
|
|
3] Reserves & Surplus |
1712.320 |
2784.680 |
2536.200 |
|
|
4] Employees stock options outstanding account |
4.730 |
0.000 |
0.000 |
|
|
5] (Accumulated Losses) |
(109.030) |
0.000 |
0.000 |
|
|
NETWORTH |
2639.540 |
3980.140 |
3377.300 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
2993.970 |
1452.460 |
1180.600 |
|
|
2] Unsecured Loans |
7633.720 |
1870.360 |
2003.500 |
|
|
TOTAL
BORROWING |
10627.690 |
3322.820 |
3184.100 |
|
|
DEFERRED TAX LIABILITIES |
79.500 |
146.200 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
13346.730 |
7449.160 |
6561.400 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
1655.510 |
1618.630 |
1260.800 |
|
|
Capital work-in-progress |
504.620 |
379.820 |
446.700 |
|
|
|
|
|
|
|
|
INVESTMENT |
8361.690 |
3097.360 |
2704.600 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
722.070
|
638.300
|
502.800
|
|
|
Sundry Debtors |
1802.200
|
1669.270
|
1206.200
|
|
|
Cash & Bank Balances |
1255.920
|
157.400
|
777.500
|
|
|
Other Current Assets |
0.000
|
0.000
|
0.000
|
|
|
Loans & Advances |
1662.490
|
1542.690
|
921.500
|
|
Total Current Assets |
5442.680
|
4007.660
|
3408.000
|
|
|
Less :
CURRENT LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Current Liabilities |
2325.070
|
1338.780
|
998.500
|
|
|
Provisions |
292.700
|
315.530
|
260.200
|
|
Total Current Liabilities |
2617.770
|
1654.310
|
1258.700
|
|
|
Net Current Assets |
2824.910
|
2353.350
|
2149.300
|
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
13346.730 |
7449.160 |
6561.400 |
|
PROFIT
& LOSS ACCOUNT
|
PARTICULARS |
31.12.2007 |
31.12.2006 |
31.12.2005 |
|
|
Sales Turnover |
3929.150 |
4550.880 |
3182.900 |
|
|
Other Income |
102.530 |
0.001 |
228.500 |
|
|
Total Income |
4031.680 |
4550.880 |
3411.400 |
|
|
|
|
|
|
|
|
Profit/(Loss) Before Tax |
(1180.260) |
417.460 |
486.800 |
|
|
Provision for Taxation |
(28.120) |
55.620 |
25.700 |
|
|
Profit/(Loss) After Tax |
(1152.140) |
361.840 |
461.100 |
|
|
|
|
|
|
|
|
Earnings in Foreign Currency : |
|
|
|
|
|
|
FOB Value of Exports of Goods |
3222.070 |
3500.250 |
2624.130 |
|
|
Development Income |
427.990 |
318.140 |
442.210 |
|
|
Sale of Investments |
0.000 |
0.000 |
35.470 |
|
|
Interest |
42.550 |
53.080 |
29.260 |
|
|
Local sales (proceeds received / receivable in Foreign Currency) |
139.890 |
464.640 |
253.000 |
|
Total Earnings |
3832.500 |
4336.110 |
3384.070 |
|
|
|
|
|
|
|
|
Imports : |
|
|
|
|
|
|
Raw Materials |
713.940 |
800.230 |
588.010 |
|
|
Capital Goods |
265.710 |
256.540 |
186.920 |
|
|
Others |
14.220 |
1.700 |
3.540 |
|
Total Imports |
993.870 |
1058.470 |
778.470 |
|
|
|
|
|
|
|
|
Expenditures : |
|
|
|
|
|
|
Materials consumed |
2418.650 |
2378.430 |
1542.000 |
|
|
(Increase)/Decrease in stock |
(93.720) |
55.730 |
(55.800) |
|
|
Excise Duty |
0.000 |
0.000 |
1.700 |
|
|
Personnel cost |
516.690 |
418.430 |
0.000 |
|
|
Operating and other expenses |
953.070 |
917.880 |
0.000 |
|
|
Manufacturing Expenses |
0.000 |
0.000 |
191.900 |
|
|
Selling
and Administration Expenses |
0.000 |
0.000 |
451.800 |
|
|
Employee Cost |
0.000 |
0.000 |
249.200 |
|
|
Finance charges |
317.750 |
198.880 |
0.000 |
|
|
Interest |
0.000 |
0.000 |
245.900 |
|
|
Loss on sale of long term
investment |
95.300 |
0.000 |
0.000 |
|
|
Miscellaneous
Expenses |
0.000 |
0.000 |
90.500 |
|
|
Power and Fuel |
0.000 |
0.000 |
82.700 |
|
|
Depreciation |
188.880 |
164.070 |
124.700 |
|
|
Impairment in investment in
subsidiaries |
815.320 |
0.000 |
0.000 |
|
Total Expenditure |
5211.940 |
4133.420 |
2924.600 |
|
QUARTERLY
RESULTS
|
PARTICULARS |
31.03.2008 |
30.06.2008 |
30.09.2008 |
|
Type |
1st
Quarter |
2nd
Quarter |
3rd
Quarter |
|
Sales
Turnover |
1196.900 |
1607.800 |
1663.200 |
|
Other
Income |
12.200 |
94.700 |
242.900 |
|
Total
Income |
1209.100 |
1702.500 |
1906.100 |
|
Total
Expenditure |
1197.500 |
2123.100 |
2283.700 |
|
Operating
Profit |
11.600 |
(420.600) |
(377.600) |
|
Interest |
121.800 |
90.400 |
92.300 |
|
Gross
Profit |
(110.200) |
(511.000) |
(469.900) |
|
Depreciation |
49.400 |
47.800 |
46.100 |
|
Tax |
0.000 |
0.800 |
0.800 |
|
Reported
PAT |
(160.500) |
(559.600) |
(516.800) |
KEY
RATIOS
|
PARTICULARS |
|
31.12.2007 |
31.12.2006 |
31.12.2005 |
|
PAT / Total Income |
(%) |
(28.58)
|
7.95 |
13.52 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
(30.04)
|
9.17 |
15.29 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
(16.63)
|
7.42 |
10.43 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
(0.45)
|
0.10 |
0.14 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
5.02
|
1.25 |
1.32 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
2.08
|
2.42 |
2.71 |
LOCAL
AGENCY FURTHER INFORMATION
HISTORY
Subject since its inception in 1990, has continously consolidated its position
at the leading edge of the International Generic Pharmaceutical and Nutritional
industry. Today, it is a multi-million dollar integrated manufacturer, with a
comprehensive product range that covers virtually all dosage forms and
therapeutic categories. Its pharmaceutical range of products are manufactured
in state of the art ISO certified plants which conform to the strictest WHO-GMP
guidelines.
The subsidiaries of Strides Arcolab are Global Remedies Limited, Strides
Research and Specialty Chemicals Limited, Arcolab Limited SA Switzerland,
Strides Acrolab FA Limited UAE, Strides Inc USA, Strides SA Pharmaceuticals Pty
Limited Republic of South Africa, Strides Africa Limited British Virgin Islands
and Quantum Life Sciences Private Limited.
Subsequent to investments in soft gelatin technology, with plants in India and
USA, Strides is now one of the largest and most sophisticated soft gelatin
manufacturers in the world. Its focus on globally competitive quality and
efficient deliveries has earned it a significant presence in the international
market among the top ten producers of Nutraceuticals world wide.
During 1999-2000, the company, to accelerate entry into new markets established
Pentagon Exim, a 100% subsidiary in UAE. Pentagon Exim will spearhead the
company's entry into GCC markets and parts of Africa in the coming years. It
also incorporated Strides Inc., a 100% subsidiary in USA. Also, during the year
it completed the two acquisitions which would enable the company to control
their production facalities better. Caryl Laboratories, a 100% subsidiary
acquired all the business assets of an existing toll manufacturer of the
company and acquisition of Global Remedies was also completed.
The company is in the process of completing investments in Solara Farmaceutica,
Mexico which will make Solara a 52% owned subsidiary company. It has
commissioned a tablet and capsules facility in Mexico and commercial production
was started in the current fiscal year. During 2001-02 the amalgamtion of Bombay
Drugs and Pharmaceuticals Limited with the company was completed.
The company has hived off its CRAM Division to Strides Research and Speciality
Chemicals Limited, a 100% subsidiary of the Company in 2002-03.
In the year 2002-03 the company has signed an Memorandum of Understanding with
Ribbon SRL Italy for setting up a 50:50 joint venture to manufacture and market
Cephalosporin formulations for the regulated markets. This facility will be set
up in Bangalore with the total captial outlay of USD 7 million. Further in
2003-04 the company has incorporated Quantum Life Sciences Private Limited as a
100% subsidiary for implementation of the Cephalosporin Project at Bangalore
with the initial capital of Rs.0.1 Million.
The company has set up Akron-Strides LLC, USA, a 50:50 Joint Venture company in
collaboration with Akron Inc., US to market products for the hospital and
retail market in the US during 2003-04.
During 2003-04 the LATAM operations in Brazil and Mexico operations were merged
into Strides Latin and the company entered into strategic agreement with LATAM
partners to acquire controlling stake. The company has commenced their
commercial production in the Solid Dosage facility in Vittoria, Brazil to cater
to domestic demand. Further the company has also commissioned semi-solid
facility in the Vittoria Pharmaceutical Complex.
In 2005, The company has made acquisitions in Poland, Italy and Venezuela. The
Italian acquisitions was completed, another two acquisitions are awaiting minor
approvals and expect to close these in the year 2006. The will continue to look
towards newer acquisitions to fuel inorganic and organic strategies for the
European Market.
The company has expanded its Anti TB Facility at KRS Gardens, Bangalore
is going on stream. The work on new warehouse and packaging facility commenced
at KRS Gardens site at Bangalore.
During the year, the company has increased its stake from 40% to 52.5% i
February 2005 and further increased to 67 and in May 2005 in Strides Latina S.A
Uruguay. And the company has acquired Strides Arcolab(UK) Limited, United
Kingdom.
BUSINESS AND
OUTLOOK
The Company's core business model of focussing on niche and difficult to
develop and manufacture products will continue to drive growth and
profitability.
Key challenges have been addressed to position the Company to be an important
player with a mix of niche products, regional leadership strategies and
building a branded business.
While the results of the Company were impacted by certain one off items,
the business model continues to be strong and sustainable and will continue to
drive profitability. The Company has exited from all unviable / non-core
operations while focusing on its core strategy to build niche hospitals and
generic play and investing in new brand business in various regions.
The major driver of business will be a strong and steady product pipeline
supported by a strong global manufacturing infrastructure. Filings made earlier
in various regulated markets have started getting approvals and supplies have
already commenced. This will lead to significant improvement in margins and
will establish the presence of the company in the regulated markets.
The Company also continues to drive business in the regulated markets through a
partnership approach which helps it to improve 'time to market' and mitigate
risk. During the year, the Company strengthened its partnerships through
additions to the product pipeline.
The Company has made significant investments in capacity upgradation and expansion
(particularly in the area of sterile injectibles) which will largely be
completed during the current year and this will result in a significant
enhancement in income and profitability as these plants will be approvable for
supplies into all the major regulated markets.
A renewed focus on driving the international business by creating regional
verticals with responsibility for enhancing income and profitability will help
generate demand growth and fill up the new manufacturing capacities.
The Company has commenced the process of putting in place a branded strategy
for its prescription and OTC products which is expected to drive significant
profitability in the less regulated markets.
ACQUISITIONS/INVESTMENTS/SUBSIDIARIES/JOINT
VENTURES
Broad and
strategic partnership entered into with Aspen Group of South Africa:
During the year, the Company closed a vital and strategic partnership with
Aspen Group in a four way deal.
·
Aspen became a strategic, equal and regional partner in its Latin America
Operations by taking 50% stake in Lakerose Limited, Cyprus, the holding Company
for Latin America operations.
·
Aspen became a global partner for the development, manufacturing and
sales / marketing of Oncology products by taking a 50% stake in Powercliff
Limited, Cyprus and a 49% stake in Onco Therapies Limited, India.
·
The Company acquired 51% interest in CoPharma Limited, Aspen's UK based
subsidiary engaged in sales and marketing of generic and OTC products.
·
The Company acquired 80% interest in Formule Naturelle [Pty] Limited,
South Africa, which will own a basket of nutraceutical products currently
marketed by Aspen in South Africa.
Genepharm transaction:
In February 2008, the Company entered into Heads of Agreement with Genepharm
Australasia Limited [Genepharm], an entity listed on the Australian Stock
Exchange, under which the Company will vend its Australian and Asian business
in exchange for the issue of shares in Genepharm, subject to approval of
Genepharm shareholders. The Company also acquired a relevant interest over
17.7% of the issued shares in Genepharm under a share acquisition agreement
with a group of Genepharm shareholders. On successful completion of the
Genepharm Transaction, the Company may emerge with a shareholding of approximately
55% of the expanded capital base of Genepharm.
The combined regional businesses are expected to have revenues of approximately
AS$ 100 Million on closing of the Genepharm Transaction. The transaction is
tentatively scheduled to close by 1st week of July 2008.
Acquisitions
·
The Company acquired a 99.59% stake in Grandix Pharmaceuticals Limited,
a branded pharmaceutical company in India. This acquisition provided an Indian
footprint for the Company and given Grandix competency in creating strong
brands will spearhead the Company's strategy to create an international branded
business.
·
The Company completed acquisition of Diaspa S.p.A USFDA approved fermentation
facility including its ongoing business. This acquisition was carried out
through Strides Italia s.r.l., Italy. This acquisition represents backward
integration for significant part of Strides' dosage form business.
Investments
During the year, the Company made the following investments.
·
Rs.1050.03 Million in the equity share capital of Grandix
Pharmaceuticals Limited, Chennai.
·
Rs.0.12 Million in the share capital of Starsmore Limited, Cyprus, a
wholly owned subsidiary of the Company.
·
Rs.246.85 Million in the share capital of Onco Therapies Limited, a
subsidiary of the Company. This investment was made by way of transfer of
assets pertaining to Oncology plant which is under construction.
Subsidiaries
The Company has incorporated the following subsidiaries in Asia through Strides
Arcolab International Limited, UK, primarily for holding the registrations /
licenses of products in those countries.
·
Strides Arcolab Hong Kong Limited, Hong Kong
·
Strides Arcolab Malaysia SDN. BHD., Malaysia
·
Strides Arcolab SDN BHD., Brunei
Strides Italia s.r.l. was incorporated as a wholly owned subsidiary of Strides
Arcolab International Limited, UK for acquiring the USFDA approved fermentation
facility of Diaspa s.p.a., Italy.
As part of the international restructuring of operations, the Company has set
up Starsmore Limited (wholly owned subsidiary of the Company) and Linkace
Limited (wholly owned subsidiary of Starsmore Limited) in Cyprus which will be
the holding Companies for international investments.
Consequent to Aspen Group acquiring 50% shareholding in Lakerose Limited, the
following companies ceased to be subsidiaries of the Company in March
2008.
·
Strides Latina SA, Uruguay
·
Cellofarm Ltda., Brazil
·
Solara SA De CV, Mexico
·
Casa de Representaciones Sumifarma CA, Venezuela
The Company also acquired 74% stake in Strides Vital Nigeria Limited, Nigeria,
through its wholly owned subsidiary Strides Africa Limited.
As part of the broad and strategic partnership entered into with the Aspen
Group of South Africa, the following companies also became the subsidiaries of
the Company.
·
Co-Pharma Limited, UK, where the Company has a 51% stake through Linkace
Limited, Cyprus and Strides Arcolab International Limited, UK.
·
Formule Naturelle (Proprietary) Limited, South Africa, in which the
Company has acquired an 80% stake through Linkace Limited, Cyprus.
Grandix Pharmaceuticals Limited and Grandix Laboratories Limited (a subsidiary
of Grandix Pharmaceuticlas Limited) also became subsidiaries of the
Company.
Onco Therapies Limited, a company incorporated for oncolytics business
in India, in which the Company holds 51% stake with 49% being held by Aspen
Group, also became a subsidiary of the Company during the year.
Sequent Scientific Limited, which was engaged in the non-core specialty
chemicals business, ceased to be a subsidiary of the Company consequent to the
sale of entire shareholding.
Strides Polska s.p. z.o.o., Poland merged with its subsidiary Strides Arcolab
Polska s.p. z.o.o, Poland during the year.
Joint Ventures
·
Strides Arcolab International Limited, UK, (SAIL) a wholly owned
subsidiary of the Company, partnered with Invent Farma Group, which includes
Laboratorios Lesvi, a leading Spanish company, to set up a 50:50 Joint Venture
Company called 'Laboratorios Domac, S.L., to develop a range of products mainly
focused for hospitals in the Spain and Portugal region.
·
SAIL partnered with Invent Farma ehf., Iceland to set up a 50:50 joint
venture Company called 'Plus Farma ehf', to acquire the entire shareholding in
'Farma Plus, Norway', which sells and markets hospital products in Scandinavian
markets.
·
SAIL partnered with Sagent Pharmaceuticals Inc., USA, to set up a 50:50
Joint Venture Company called 'Sagent Strides LLC' in USA to develop, supply and
market injectible products for the U.S. market. The agreement initially targets
over 25 products. Under the agreement, Strides will develop and supply
injectible products that Sagent will market in USA.
·
As part of the broad and strategic partnership entered into with Aspen
group of South Africa, the following joint venture Companies were formed
/established during the year:
·
Powercliff Limited, Cyprus - a 50:50 Joint Venture company for
development and global marketing of oncolytic products.
·
Lakerose Limited, Cyprus - a 50:50 Joint Venture company for Latin
America Operations.
MANAGEMENT
DISCUSSION AND ANALYSIS
Industry Structure and Developments
The Pharmaceutical Industry is characterized by an enormously lengthy and risk
prone research and development process, intense competition for intellectual
property and stringently regulated by the governments; at the same time,
balancing between the margin needs of the industry players and the
affordability needs of the society. Spurred on by the major discovery of
Penicillin, the industry expanded rapidly in the 1960s from significant new
discoveries, with Research and Development (REW) entrenched firmly as the
foundation and lifeline of the industry. The 1970s brought a legislation fixing
a typical 20 year period on patent protection from the initial filing as a new
discovery, which acted as the 'birth' of generic medicines. Having the same
active ingredients as the original product, as well as the same bioequivalence,
generics brought competitiveness to the market place, providing alternatives to
the medical practitioners and patients. The 1980s saw various governments bring
about regulatory control over the prices in their efforts to control healthcare
expenditure, which brought REW into greater focus, to bring into the market
cheaper versions of patented products. The REW product pipeline continues to be
the most valuable aspect of the pharmaceutical industry. By the turn of the
millennium, the pharmaceutical industry has made tremendous progress and
contribution to the human well-being, raising the average life expectancy. The
REW costs have risen sharply whereas the product life cycle has reduced.
Product pricing, approvals and promotion are being subjected to increasingly
onerous regulations.
The pharmaceutical industry comprises of Active Pharmaceutical Ingredients
(API) or Bulk Drugs and Finished Dosage Forms or Formulations. The latter are
further categorized as 'Ethical', which are the prescription products, and
'Over the Counter' (OTC), which can be sold without a prescription of a medical
practitioner. The Ethical products comprise of various therapeutic segments
like Immunosuppresants, Anti-biotics, Anti-Infectives, Anti- Bacterial, Anti
-Diabetic, Cardio-Vascular, Neurological, Gastro-Intestinal, Dermatology, etc.
The total size of the global pharmaceutical industry was US$ 712 Billion in
2007, the biggest share in which was that of United States of America at US$
286.50 Billion
The Indian Pharmaceutical Industry, from being an import dependent industry in
the 1950s, has achieved self-sufficiency and gained global recognition as a
producer of low cost high quality bulk drugs and formulations.
Leading Indian companies have developed infrastructure in
over 60 countries including developed markets like US and Europe. In the recent
past, several pharmaceutical companies have demonstrated that they possess the
ability to engage in commercially viable research and development activities
and become significant players in the international market.
Though considered to be one of the fastest growing industries, it is still
largely unregulated and has grown 13% in the year 2007. While in terms of
volume, given the size of its population, the Indian Pharmaceutical Industry
ranks fourth and accounts for 8% of the world's production and ranks thirteenth
in terms of value. The Indian Pharmaceutical Industry, backed by a strong
scientific talent pool is, however, emerging as one of the major investment
destinations of big pharmaceutical companies. In addition to its strong
scientific capabilities, it also provides a low cost manufacturing base and has
the largest USFDA approved plants outside the US. From being an industry
focused only on generics, engaged in reverse engineering of a number of products
on account of lack of product patent protection till 2004, it has now made
major strides into all areas covering discovery, clinical trials, analytical
development, dossier preparation and high quality manufacturing capabilities.
The Indian Pharmaceutical Industry currently exports API and Finished Dosage
Forms worth about USD 3.8 Billion and ranks 17th in terms of export value with
exports covering both regulated/ semi-unregulated markets.
Opportunities and Threats
Globally, the Indian Pharmaceutical industry ranks 4th in terms of volume, and
13th in terms of value and produces 20 - 24 % of the world's generic drugs. The
industry has developed Good Manufacturing Practices (GMP) facilities for the
production of different dosage forms. India's pharmaceutical industry has grown
at a CAGR of 13 percent from 2002-2007 and is expected to grow at a CAGR of 16
percent over 2007-2011. Over the last couple of years, the pharmaceuticals
industry has grown at approximately 1.5-1.6 times the growth of the economy.
The rise in disposable income has a positive impact on healthcare spend. In
2005, 6.2 percent of disposable income was spent on healthcare as compared to
2.8 percent in 1995. This augurs well for the pharmaceutical industry, as the
strong economic momentum is likely to continue with the Indian economy expected
to grow by 8-9 percent in the next few years and is well positioned for
sustainable growth and expansion.
India is emerging as the global hub for contract research and manufacturing
services due to a combination of low-cost and world-class quality standards.
According to a study by Ernst and Young, the total market for clinical research
activities in India is expected to touch $1.5-2 billion by 2010. Also, India
has been listed second (just after China) for attractiveness as a clinical
trials centre. With pharmaceutical majors facing increased pressure on profit
margins, spiraling REW costs and increasing overheads, outsourcing of clinical
research processes to third parties in developing countries seems a viable
option. By contracting such work to India, they save 40-60 percent in new drug
development.
India has the capability to become a global pharmaceutical hub by exporting
domestically produced generic products and positioning itself as an off shoring
destination for clinical and pre-clinical research and other support services.
There is tremendous potential in the Indian Pharmaceutical market itself.
Consumer spending on healthcare went up from 4 percent of GDP in 1995 to 7
percent in 2007. That number is expected to rise to 13 percent of GDP by
2015.
The greatest strengths of the Indian Pharmaceutical Industry are its cost
advantage, high standards in terms of quality, stability and international
safety, health and environment protection, strong scientific and technical
manpower, excellent centre for clinical trials and a tremendous export
potential.
However, with the increasing costs of manpower and competition from emerging
countries in South Asia, and the stringent regulatory framework of the
regulated markets, the Indian Pharmaceutical Industry will have to strive in
achieving technical excellence ensuring compliance with highest standards of
GMP.
The Company, with its vision to become a global Life Sciences Company, focuses
on niche and difficult to manufacture products. Having a strong and cost
efficient REW product pipeline, the Company provides competitive advantage to
its partners in the global space. Operating only in the generic space, the
Company has increased its presence in the global markets with manufacturing
capabilities in Europe, Latin America, Asia and Africa, with a dedicated
Research Et Development Centre in India.
To tap the potential in the
Indian market, the Company also made an entry into the Indian Branded Pharmaceutical
market through its acquisition of Grandix Pharmaceuticals Limited, Chermai.
This company is engaged in ethical selling of prescription products and over
the years, has built a formidable portfolio of products spanning across various
therapeutic segments with some very strong brands. This company has a large
sales force and its geographical footprint currently spans South and Central
India and is expanding at a rapid pace.
Outlook
The Company has effected some significant changes in its business
model for driving efficiencies in revenue and cost as also to take advantage of
the opportunities that are available. Towards this, it decided to split its
business into India Operations (focused on manufacturing and research and
development and driving operating efficiencies therein) and International
Operations (focused on driving global opportunities and customer relationships
with the globe divided into regions). The organization structure was also
realigned with this new business model and necessary action was initiated on
filling up the identified gaps in leadership to drive this.
During the year, the Company expects the following to be the drivers of its
business and profitability:
·
Significant improvements in operating efficiencies in both manufacturing
and R and D, resulting in increased revenues and improved profitability.
·
Approvals for a number of filings in the regulated markets
and commencement of supplies.
·
Creation of branded business strategy to be driven across
the group.
·
Completion of capacity upgradation and expansion largely in
the space of sterile injectables.
·
Improved business and profitability on account of
commencement of the new plants in Brazil and Nigeria.
·
Better profitability with closure of the loss making plant
in USA and the hive off of the speciality chemicals business.
During 2008, the Company completed the transaction entered into with Aspen
Pharmacare Holdings Limited of South Africa for the strategic / financial
partnership in the Latin America operations, which is expected to give a boost
to business there both through organic and inorganic means.
The Company also made a binding bid for the acquisition of a 55% stake in
Genepharm Australasia Limited, a very significant generics business player in
Australia and one which will help the Company to acquire a sizeable presence in
the Australasia region.
Financial
Performance
The Company registered a total income of Rs. 4032 Million as compared to Rs. 4551
Million last year. The decrease in total income was an outcome of various
factors like unprecedented appreciation in INR, reversal of REW revenue on
account of contractual realignment, competitive pressure on the prices of ATM
(AIDS, TB and Malaria) products and slowdown of business of the Latin America
subsidiaries which source a large part of their products from India.
Rising material costs and pressure on margins of ATM business together with
rationalization of personnel costs by aligning them to market had an adverse
impact on the margins. This was further compounded by the recognition of
impairment in relation to value of some of the brands and slow moving stock,
adjustments in relation to the Latin America business consequent to the
induction of Aspen Pharmacare as a strategic and financial partner in that
business and loss on account of foreign exchange derivative contracts. As a
consequence, the EBITDA margin was negative.
The increase in working capital rates by bankers, along with interest on Fully
Convertible Debentures issued to the strategic partner in Latin America led to
higher interest costs.
Consequent to the decision to exit all non-core businesses, the specialty
chemicals business was hived off resulting in a loss of Rs. 95.30 Million to
the Company. It was also decided to write-down the investment in the subsidiary
in USA as a consequence of the closure of the plant announced by the Board. As
a consequence of change in the regulatory requirements of the USFDA in relation
to plants manufacturing nutraceutical products, the operations had become
unviable and as other options to revive the plant were not available, it was
considered best to shut down the plant and reduce the workforce to a bare
minimum. This amounted to a write-down of Rs. 815.32 Million. As a result, the
Company incurred a loss of Rs. 1152 Million as against profit of Rs. 362
Million last year.
The Company continued to expand its asset base and the spend on capital
expenditure was Rs. 322 Million. The construction of the oncology plant which
was commenced in late 2006 is nearing completion and one line was validated in
March 2008. Construction of a new Steriles Plant at Bommasandra, Bangalore was
also commenced and is expected to be complete by the end of 2008.
Contingent
Liabilities
·
Corporate guarantees given to financial institutions and other parties
towards credit facilities / advances, on behalf of subsidiaries - Rs.1,140.13
Million (Previous year - Rs.1,531.47 Million). The Company’s fixed assets
(pari-passu second charge) and some of investments in the respective
subsidiaries have been offered as security in respect of some of these
facilities
·
In addition to the above, the Company had provided guarantees of
Rs.161.27 Million to third parties in connection with borrowings of Sequent
Scientific Limited, which was a subsidiary at the time of granting of such
guarantees.At December 31, 2007, consequent to disposal of Sequent Scientific
Limited, the Company has initiated processes to withdraw the corporate guarantees.
·
Bills discounted with Banks which are outstanding as on December 31,
2007- Rs.651.04 Million (Previous year Rs.1,094.55 Million)
·
The Company has, arising from the assessment proceedings relating to
earlier years, received demands totaling to Rs.224.83 Million (Previous year -
Rs. 143.75 Million) from the income tax authorities on account of certain
disallowances considered by them. The Company has disputed the disallowances
and has, preferred appeals against these demands. Pending resolution of the
same, no provision has been made in the accounts for such disputed amounts.
·
Entry Tax paid under protest - Rs.Nil (Previous year- Rs.1.36 Million)
relating to entry tax demanded as per Karnataka Special Tax on Entry of Certain
Goods Act, 2004. The Company had preferred a Writ petition challenging the
applicability of the Act to the Company. The Hon’ble High Court of Karnataka
vide its order dated March 29, 2007 struck down the applicability of Act.
However, the Government of Karnataka preferred a appeal challenging the Order
of the single judge of Hon’ble High Court of Karnataka.The final adjudication
on this matter is pending with the Hon’ble High Court of Karnataka.
·
Excise Duty paid under protest - Rs.Nil (Previous year-Rs.5.25 Million)
relating to cenvat credits availed at the time of conversion of some of the
divisions of the Company into Export Oriented Units.
·
The Company preferred
appeal with the CESTAT against the order of the Commissioner of Central Excise
for disallowing transfer of cenvat credit of Rs.3.86 Million (Previous year Rs
Nil) as on the date of conversion of one of the units of the Company into a
100% EOU.
The Company
entered into a strategic alliance with Aspen Pharmacare Holdings Limited Republic
of South Africa (Aspen), under which Aspen becomes a 50% joint venture partner
in respect of the Company’s Latin American operations effective March 1, 2008.
As part of its obligations under the Joint venture, Aspen is required to buy
from Starsmore Limited, Cyprus, (a subsidiary of the Company), a part of its
share holding in Lakerose Limited (the holding Company for the Latin American
operations) for a consideration of US$ 58.50 Million and invest a further sum
of US$ 94 Million in Lakerose, against subscription to fresh shares such that
the share holding in Lakerose in the aggregate comes to 50%.
In respect of the
above Joint venture, the Company has provided a warranty to Aspen that Earnings
before Interest, Depreciation, Amortisation and Tax computed under the
International Financial Reporting Standards (EBITDA), will not be less than US$
28 Million in the 12 months period commencing from March 1, 2008, in respect of
the Latin American operations. Under the agreement with Aspen, the Company is
liable to 4.66 times of the shortfall, if any, between the actual EBITDA in the
said period from the Latin American operations and the warranted EBITDA of US$
28 Million.
In connection with
the above Joint venture, the Company has effective March 1, 2008, provided a
guarantee of US$ 75 Million to Aspen, which shall, subject to approval from the
appropriate authorities, be increased to US$ 152.5 Million.
·
Foreign currency
convertible bonds:
The Company issued Foreign Currency Convertible Bonds ( FCCB ) amounting
to US$ 100 Million ( Rs.4,070 Million) on June 26, 2007. These bonds carry zero
coupon and are to be redeemed on June 27, 2012 (unless converted into Equity
Shares) at 145.058 per cent of the Principal amount.
The bonds may be redeemed in whole, but not in part at the option of the
Company at any time on or after July 18, 2010 and on and prior to June 20, 2012
with a redemption premium of 7.575 per cent (which is identical to the gross
yield in case of redemption at maturity) calculated on a semi annual basis. As
at December 31, 2007, 1/5th of the premium payable on maturity (along with
related exchange fluctuation as on December 31, 2007) has been transferred to
the Debenture Redemption Reserve Account with a corresponding adjustment to the
Securities Premium Account.
·
The Bonds are convertible at any time on or after August 6, 2007 and up
to the close of business on June 20, 2012 by the holders of the Bonds into
Shares at the option of the Bondholder, at an initial conversion price of
Rs.461.553 per Share with a fixed rate of exchange of Rs.40.70 per US$ on
conversion. The bonds are listed on Singapore Exchange Securities Trading
Limited, Singapore.
During the accounting year ending December 31, 2005, the Company had
issued Foreign Currency Convertible Bonds (listed in the Singapore Exchange
Securities Trading Limited, Singapore) to the extent of US$ 40 Million. These
bonds carry an interest rate of 0.5 % p.a. and are to be redeemed on April 19,
2010 (unless converted into Equity Shares) at 136.78 percent of the Principal
amount.
The Bonds may be redeemed in whole, but not in part, at the option of
the Company at any time on or after April 18, 2008 but prior to April 19, 2010
with a redemption premium of 6.8% per annum (which is identical to the gross
yield in case of redemption at maturity), calculated on bi-annual basis. The
premium payable on maturity (along with related exchange fluctuation as at the
end of the year) has been transferred to the Debenture Redemption Reserve with
a corresponding adjustment to the Securities Premium Account.
The Bonds are convertible by the Bond holders into shares at any time on
or after May 18, 2005 at an initial price of Rs. 358.70 per share with a fixed
conversion rate of Rs.43.7767 = US $ 1.00. The initial conversion price will be
subject to adjustment by the Company for Bonus issue, division, consolidation
and reclassification of shares etc as defined in the terms of issue of the
Bonds.
·
As at December 31, 2007, none of the above bonds had been offered for
conversion.
Cumulative
Redeemable Preference Shares:
During the year
ending December 31,2005, the Company had issued 491,606 Cumulative Redeemable
Preference shares of Rs.1,000/- each fully paid to K V Pharmaceuticals, USA
(KV) The Cumulative Redeemable Preference shares carry dividend of 6% (Rs.60
per share) per annum. The Preference shares are redeemable at par along with
accrued unpaid dividend on or before December 31, 2012. If any of these shares
are not redeemed on the said date, the redemption price subsequent to December
31, 2012 shall contain an increasing default premium which shall be 10%, if
redemption occurs in the year 2013 and an additional 10% per each year there
after in which the shares are redeemed. These shares are entitled to dividends at
the rate of 15%, (Rs. 150 per share) after 2012.
Preference
Dividend unpaid at December 31, 2007 represents dividends on these preference
shares for the years 2005 and 2006. While these dividends have been declared, in
accordance with the Share Purchase Agreement with KV, they are due and payable
only on or after December 31, 2010, without interest thereon.
No dividends were
appropriated in 2007 in the absence of distributable profits.
Fully convertible
debentures:
On June 8, 2007,
the Company allotted 5,045,725 fully convertible debentures (FCDs) at a price
of Rs.400 per debenture, on preferential basis, to Dobliss Holdings Limited
(3,111,440 FCDs) and Blissup Holdings Limited (1,934,285 FCDs), associate
companies of Mr.Elcemar Almeida, a non resident and non executive director of
the Company. These convertible debentures carry a interest @ 5% p.a. and are
convertible into an equivalent number of fully paid up equity shares of Rs.10
each, in one or more tranches, at any time within a period of 18 months from
the date of issue.
As at December 31,
2007, none of the debentures has been offered for conversion.
FIXED ASSETS
· Freehold Land
· Leased Hold Land
· Buildings
· Furniture and Fixtures
· Office Equipment and Computers
· Plant and Machinery
· Motor Vehicles
· Registration and Brands
·
Software Licences
AS PER
WEBSITE
An Overview:
Established
in 1990, Subject is one of India’s integrated manufacturer and exporter of
finished pharmaceutical dosage forms – both branded and generic. They are a
significant global player in soft gelatin capsules and sterile parenterals with
quality standards that meet the most stringent regulated market standards.
They
have 13 world class plants in India, Singapore, Brazil, Mexico, Poland and Italy
offering the partners the advantage of multi-locational product sourcing.
They
are among the world’s top 5 soft gelatin capsule manufacturers.
The
R and D interweave offers end-to-end solutions from concept to delivery and a
go-to-market pipeline of products that are patent non-infringing formulations
across dosage forms.
They
have marketing presence in 55 countries. This broad network facilitates
partnering with global organisations ranging from Unicef, UNDP, Global TB Drug
Facility, The Clinton Foundation to European and American pharma giants and
even private labelers and distribution chains.
In
addition, they undertake contract R and D and manufacture of pharmaceutical
dosage forms.
Leadership through partnering:
As
pharma companies reach out to enhance their strength and competitiveness, their
key requirement is for a synergistic partner. A partner who is truly global in
skill sets, R and D, manufacturing practices and in attitude and vision.
They
are all that and more – because they believe in “Leadership through
Partnering”. They are partners to more than 10 of the world’s top 50 pharma
majors in Australia, South Africa, Europe, and USA.
The
ethos centers around customer focus and rapid response. Over the last decade,
they have systematically strengthened the capabilities in understanding and
aligning themselves with the partner’s needs. Through product innovation,
manufacturing, operational flexibilities and leveraging the IP in formulation
technologies, they have significantly enhanced the partner’s marketing
leadership.
A step ahead in manufacturing:
The manufacturing
platform is global in scale and compliance. They are among the few fully
integrated players in soft gels and steriles. The quality standards meet the
most stringent regulated market requirements. Strategic sourcing of APIs and
high quality, cost effective manufacturing give our partners and them a
competitive edge.
They have 13 world
class plants in India, Singapore, Brazil, Mexico, Poland and Italy, all
conforming to WHO’s cGMP guidelines. The oral dosage forms plant in Bangalore
is approved by MHHRA, TGA, MCC, ANVISA and a host of regulatory authorities
from countries in Asia and Africa. This plant is also pre-qualified by WHO for
manufacture of HIV/ AIDS and anti TB drugs and is approved by USFDA under
PEPFAR.
They have
dedicated facilities for the manufacture of cephalosporins, beta lactams and
anti TB products (colored).
The dosage forms
range includes tablets, capsules, soft gelatin capsules, parenterals and
semi-solids.
Product
ORAL
DOSAGE FOR
·
Immunosuppressants
·
Anti-retroviral drugs
·
Anti-tuberculosis product
·
Anti-malarial drugs
·
Antibiotics and anti-infectives
·
Other anti-infectives
·
Anti –anginal and anti- hypertensive drugs
·
Hypolipidaemic Agents (Cholesterol Reducing Agents)
·
Gastrointestinal Agents
·
Anti-emetics
·
NSAIDs /Analgesics
·
Steroids and Hormones
·
Anti-allergic drugs
·
Vitamins/Minerals and Calcium regulators
STERILE
PRODUCTS
·
Immunosuppressant
·
Anti-tuberculosis agents
·
Anti-malarial
·
Antibiotics and anti-infectives
·
Steroids and Hormones
·
Antispasmodic/ muscle relaxants
·
Gastrointestinal Agents
BETA
LACTAMS
Beta Lactams
CEPHALOSPORINS
Cephalosporins
PRESS RELEASE
Strides Arcolab receives USFDA approval for one
more product – Takes total Sterile product approvals to 12.
Strides Arcolab
Limited (“Strides”) today announced receipt of one ANDA approval for
Pamidronate Disodium Injection, 3mg/ml (packaged in 30mg/10ml) and 9mg/ml
(packaged in 90mg/10ml) Single use Vials. The product is licensed to
Akorn-Strides, LLC, which is a Joint Venture that was formed in 2004 by Akorn
Inc and Strides Arcolab Limited
Ravi Seth, Chief
Executive Officer- International Operations of Strides stated: “It is indeed
gratifying that with 12 ANDA approvals, the Strides Akorn JV has a good sized
offering of generic injectable products for the US markets. The JV which posted
a healthy performance for Q3 2008, expects to have all these products launched
in the market by Q1, 2009.”
Strides Arcolab
Receives USFDA Approval For Its Oral Dosage Form Facility, Bangalore
Strides Arcolab
today announced that its oral dosage forms manufacturing site in Bangalore [KRS
Gardens] has been classified as acceptable by the USFDA for manufacturing oral
products for the US market.
Venkat Iyer, CEO –
India Operations of Strides said “the continued USFDA approval of the facility
is an important milestone for the Company’s US strategy and will support
important product approvals and introductions.
CMT
REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from
various sources including but not limited to: The Courts, India Prisons
Service, Interpol, etc.
1] INFORMATION
ON DESIGNATED PARTY
No exist designating subject or any of its beneficial
owners, controlling shareholders or senior officers as terrorist or terrorist
organization or whom notice had been received that all financial transactions
involving their assets have been blocked or convicted, found guilty or against
whom a judgement or order had been entered in a proceedings for violating
money-laundering, anti-corruption or bribery or international economic or
anti-terrorism sanction laws or whose assets were seized, blocked, frozen or
ordered forfeited for violation of money laundering or international
anti-terrorism laws.
2] Court
Declaration :
No records exist to suggest that
subject is or was the subject of any formal or informal allegations,
prosecutions or other official proceeding for making any prohibited payments or
other improper payments to government officials for engaging in prohibited
transactions or with designated parties.
3] Asset
Declaration :
No records exist to suggest that the property or assets of
the subject are derived from criminal conduct or a prohibited transaction.
4] Record
on Financial Crime :
Charges or
conviction registered against subject: None
5] Records
on Violation of Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records
on Int’l Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal
Records
No
available information exist that suggest that subject or any of its principals
have been formally charged or convicted by a competent governmental authority
for any financial crime or under any formal investigation by a competent
government authority for any violation of anti-corruption laws or international
anti-money laundering laws or standard.
8] Affiliation
with Government :
No
record exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation
Package :
Our
market survey revealed that the amount of compensation sought by the subject is
fair and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report
:
No press reports / filings exists on
the subject.
CORPORATE
GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments
on Corporate Governance to identify management and governance. These factors
often have been predictive and in some cases have created vulnerabilities to
credit deterioration.
Our Governance Assessment focuses principally on the
interactions between a company’s management, its Board of Directors,
Shareholders and other financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN
EXCHANGE RATES
|
Currency |
Unit
|
Indian
Rupees |
|
US Dollar |
1 |
Rs.49.69 |
|
UK Pound |
1 |
Rs.72.96 |
|
Euro |
1 |
Rs.63.46 |
SCORE
& RATING EXPLANATIONS
|
SCORE
FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
7 |
|
PAID-UP CAPITAL |
1~10 |
7 |
|
OPERATING SCALE |
1~10 |
7 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
6 |
|
--LIQUIDITY |
1~10 |
8 |
|
--LEVERAGE |
1~10 |
8 |
|
--RESERVES |
1~10 |
8 |
|
--CREDIT LINES |
1~10 |
7 |
|
--MARGINS |
-5~5 |
- |
|
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 |
NO |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
67 |
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%)
RATING EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Unfavourable & favourable factors carry similar weight in credit
consideration. Capability to overcome financial difficulties seems
comparatively below average. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
NR |
In view of the lack of information, we have no basis upon which to
recommend credit dealings |
No Rating |
|