MIRA INFORM REPORT

Report Date :

13.01.2012

IDENTIFICATION DETAILS

Name :	NECTAR LIFE SCIENCES LIMITED (w.e.f. 26.03.2004)
Formerly Known As :	SURYA MEDICARE LIMITED
Registered Office :	Village Saidpura, Tehsil Dera Bassi, District Patiala – 140507, Punjab
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	27.06.1995
Com. Reg. No.:	16-016664
Capital Investment / Paid-up Capital :	Rs.224.260 Millions
CIN No.: [Company Identification No.]	L24232PB1995PLC016664
TAN No.: [Tax Deduction & Collection Account No.]	PTLS10181D
PAN No.: [Permanent Account No.]	AABCS6468G
Legal Form :	A Public Limited Liability company. The company’s Shares are Listed on the Stock Exchange.
Line of Business :	Manufacturing of Medicines like Ampicillin, Trihydrate, S. Sterilite, Amoxycillin.
No. of Employees :	1700 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

A (64)

RATING		STATUS	PROPOSED CREDIT LINE
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

Maximum Credit Limit :	USD 28800000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is an established company having fine track. Financial position of the company appears to be sound. Directors are reported to be experienced, respectable businessmen. Trade relations are reported as fair. Payments are reported to be regular and as per commitment. The company can be considered normal for business dealings at usual trade terms and condition.

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

ECGC Country Risk Classification List – September 30, 2011

Country Name	Previous Rating (30.06.2011)	Current Rating (30.09.2011)
India	A1	A1

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

LOCATIONS

Registered Office :	Village Saidpura, Tehsil Dera Bassi, District Patiala - 140507, Punjab India
Tel. No.:	91-1762-308000/308001/231187/231287/231387
Fax No.:	91-1762-281187
E-Mail :	sales@suryamed.com sunderlal@neclife.com
Website :	http://www.suryamed.com http://www.neclife.com
Location :	Owned
Head Office :	#1596, Bhaigrath Place, Chandni Chowk, Delhi – 110048, India
E-Mail :	91-11-23866341/23869202-03
Fax No.:	91-11-23866341
Corporate Office :	SCO 38-39, Sector 9-D, Chandigarh – 160009 (U.T.), India
Tel. No.:	91-172-3047777/3047701
Fax No.:	91-172-3047755
Factory :	110, Industrial Area, Phase-I, Chandigarh-16002, Haryana, India
Tel. No.:	91-172-2658317/2655166/2655438/2655775
Fax No.:	91-172-2655377
E-Mail :	sales@suryamed.com sales@neclife.com
Area :	2500 sq.yds.
Location :	Owned
Factory :	Unit I Village: Saidpura, Tehsil: Derabassi, District Mohali (Punjab), India Unit II Village: Saidpura, Tehsil: Derabassi, District Mohali (Punjab), India Empty Hard Gelatin Capsule Unit Village Bhatoli Kalan, Pargana Dharmpur, Tehsil Nalagarh, District Solan, (Himachal Pradesh), India Formulation Unit Village Bhatoli Kalan, Pargana Dharmpur, Tehsil Nalagarh, District Solan, (Himachal Pradesh), India Narbada Industries Plot No. 2, Lane No. 4, Phase II, SIDCO INDUSTRIAL COMPLEX Bari Brahmana, Jammu (Jammu and Kashmir), India
Branches :	Located at : Indore Delhi
Administrative Office :	48/1 Dickmans Road, Colombo 4, Sri Lanka
E-Mail:	chempharma@neclife.com
Marketing Office :	D – 708, Crysral Plaza, Office New Link Road, Opposite Infinitti Mall, Andheri (w), Mumbai – 400053, India
Tel. No.:	91-22-32060171
Fax No.:	91-22-26736793

DIRECTORS

As on 31.03.2011

Name :	Mr. Sanjiv Goyal
Designation :	Chairman and Managing Director
Name :	Mr. Aryan Goyal
Designation :	Executive Director
Name :	Mr. Dinesh Dua
Designation :	Director and Chief Executive Officer
Name :	Mr. Saurabh Goyal
Designation :	Executive Director
Name :	Mr. Vivek Seth
Designation :	Director
Name :	Mr. Vijay J Shah
Designation :	Independent Director
Name :	Mr. Basant Kumar Goswami
Designation :	Independent Director
Name :	Dr. (Maj. Gen.) S. S. Chauhan, VSM
Designation :	Independent Director
Name :	Mr. Raman Kapur
Designation :	Independent Director
Name :	Mr. Ajay Swaroop
Designation :	Independent Director

KEY EXECUTIVES

Name :	Mr. Sandeep Goel
Designation :	Vice President (Finance)
Name :	Mr. R. K. Aggarwal
Designation :	Vice President (Accounts)
Name :	Mr. Sunder Lal
Designation :	Vice President and Company Secretary

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 30.09.2011

Category of Shareholders	No. of Shares	Percentage of Holding
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Individuals / Hindu Undivided Family	99364000	55.74
Sub Total	99364000	55.74
(2) Foreign
Total shareholding of Promoter and Promoter Group (A)	99364000	55.74
(B) Public Shareholding
(1) Institutions
Insurance Companies	4431505	2.49
Foreign Institutional Investors	5127411	2.88
Any Others (Specify)	26000000	14.59
Foreign Companies	26000000	14.59
Sub Total	35558916	19.95
(2) Non-Institutions
Bodies Corporate	17422491	9.77
Individuals
Individual shareholders holding nominal share capital up to Rs. 0.100 million	19513668	10.95
Individual shareholders holding nominal share capital in excess of Rs. 0.100 million	3783670	2.12
Any Others (Specify)	2618225	1.47
Non Resident Indians	2525265	1.42
Clearing Members	56585	0.03
Trusts	36375	0.02
Sub Total	43338054	24.31
Total Public shareholding (B)	78896970	44.26
Total (A)+(B)	178260970	100.00
(C) Shares held by Custodians and against which Depository Receipts have been issued
(1) Promoter and Promoter Group	-	-
(2) Public	46000000	-
Sub Total	46000000	-
Total (A)+(B)+(C)	224260970	-

BUSINESS DETAILS

Line of Business :

Manufacturing of Medicines like Ampicillin, Trihydrate, S. Sterilite, Amoxycillin.

Products :

PRODUCT DESCRIPTION	ITEM CODE NO
Cefixime Trihydrate	29419090
Ceftriaxone Sodium Sterile	29419090
Cefuroxine Axetil Amorphous	29419090

PRODUCTION STATUS AS ON 31.03.2011

Particulars	Unit	Installed Capacity	Actual Production
Bulk Drug & Sterile	MTs	1800.00	1086.82
Job Work Executed	MTs		18.78
Phytochemicals – Menthol	MTs	7600.00	1958.80
EH Gelatin Capsules	Nos	2880.00	2970.33*
Formulations	Nos	345.00	115.00

* Actual Production exceeds installed capacity due to change in product mix.

Note :

(i) In terms of press note no. 4 (1994 series) dated October 25, 1994 issued by the department of Industrial Development, Ministry of Industry, Government of India, Industrial licensing has been abolished in respect of bulk drugs and formulations.

(ii) Installed Capacities are as certified by Management and have not been verified by the auditors being a technical matter.

GENERAL INFORMATION

No. of Employees :

1700 (Approximately)

Bankers :

· Punjab National Bank, Sector 16D, Chandigarh, India

· State Bank of India, Specialised Commercial Branch, Sector 17B, Chandigarh, India

· Vijaya Bank, Barakhamba Road, New Delhi, India

· Exim Bank, Mumbai, Maharashtra, India

· HSBC, Barakhamba Road, New Delhi, India

Facilities :

Secured Loan	As on 31.03.2011 (Rs. in Millions)	As on 31.03.2010 (Rs. in Millions)
Term Loans	3177.140	2904.670
Working Capital Limits	3300.100	1605.480
Total	6477.240	4510.150
Unsecured Loan	As on 31.03.2011 (Rs. in Millions)	As on 31.03.2010 (Rs. in Millions)
Vehicle Loans	11.340	11.300
Foreign Currency Convertible Bonds (FCCB)	1471.380	1487.480
Total	1482.720	1498.780

Banking Relations :	--
Auditors :
Name :	Datta Singla and Company Chartered Accountants
Address :	SCO 2935-36, 1st Floor, Sector 22-C, Chandigarh, India
Subsidiary Companies :	· Chempharma Private Limited – Sri Lanka – Wound up during the year · Nectar Capital Limited – Mauritius – Incorporated on 27th May, 2010 · Nectar Lifesciences UK Limited – United Kingdom – Incorporated on 1st March, 2011
Entities over which key management personnel/ their relatives are able to exercise significant influence* :	· Surya Narrow Fabrics – New Delhi · Nectar Lifestyle Limited- New Delhi · Nectar Organics Limited – New Delhi * With whom the company had transactions during the year

CAPITAL STRUCTURE

As on 31.03.2011

Authorised Capital :

No. of Shares	Type	Value	Amount
350000000	Equity Shares	Re.1/- each	Rs.350.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
224260970	Equity Shares	Re.1/- each	Rs.224.260 Millions

Note :

1. During the year 2009-10 Company issued 26000000 equity shares of Re. 1/- each as private placement at a premium of Rs.34/- each.

2. During the year 2009-10 Company allotted 46000000 Global Depository Receipts (GDRs) representing 46000000 equity shares of Re.1/- each at a premium of Rs.34.02 per share.

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2011	31.03.2010	31.03.2009
SHAREHOLDERS FUNDS
1] Share Capital		224.260	224.260	152.260
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		6987.570	5985.520	2879.000
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		7211.830	6209.780	3031.260
LOAN FUNDS
1] Secured Loans		6477.240	4510.150	5022.330
2] Unsecured Loans		1482.720	1498.780	2021.120
TOTAL BORROWING		7959.960	6008.930	7043.450
DEFERRED TAX LIABILITIES		508.060	501.860	401.840
TOTAL		15679.850	12720.570	10476.550
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		7362.590	6272.600	5260.680
Capital work-in-progress		824.170	555.130	740.300
INVESTMENT		53.820	256.930	56.160
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	4708.850	3963.540	3496.200
	Sundry Debtors	3111.280	2224.550	1672.570
	Cash & Bank Balances	325.750	305.170	344.020
	Other Current Assets	220.460	264.660	1005.870
	Loans & Advances	1518.980	964.400	321.550
Total Current Assets		9885.320	7722.320	6840.210
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	1399.350	1345.160	1800.500
	Other Current Liabilities	152.730	91.980	83.370
	Provisions	894.270	649.630	0.000
Total Current Liabilities		2446.350	2086.770	2424.160
Net Current Assets		7438.970	5635.550	4416.050
MISCELLANEOUS EXPENSES		0.300	0.360	3.360
TOTAL		15679.850	12720.570	10476.550

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2011	31.03.2010	31.03.2009
	SALES
		Income	10554.480	8457.990	7279.680
		Other Income	200.700	189.530	60.660
		TOTAL (A)	10755.180	8647.520	7340.340
Less	EXPENSES
		Raw Material Consumed	7426.980	5349.170	4933.280
		Manufacturing Expenses	430.080	349.810	334.940
		Personnel Expenses	371.680	318.770	277.250
		Administrative Expenses	163.470	113.790	160.140
		Repair and Maintenance	65.070	57.380	36.000
		Selling and Distribution Expenses	210.750	224.660	216.460
		Preliminary Expenses Written Off	0.090	0.080	0.080
		Increased decreased in stock	(316.280)	93.940	(73.430)
		TOTAL (B)	8351.840	6507.600	5884.720
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		2403.340	2139.920	1455.620
Less	FINANCIAL EXPENSES (D)		740.840	602.840	496.060
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		1662.500	1537.080	959.560
Less/ Add	DEPRECIATION/ AMORTISATION (F)		460.960	387.460	301.890
	PROFIT BEFORE TAX (E-F) (G)		1201.540	1149.620	657.670
Less	TAX (H)		173.450	229.880	111.890
	PROFIT AFTER TAX (G-H) (I)		1028.090	919.740	545.780
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		3120.640	2345.440	1817.480
Less	APPROPRIATIONS
		Transfer to General Reserve	0.000	100.000	0.000
		Interim Dividend	0.000	38.070	0.000
		Tax on Interim Dividend	0.000	6.470	0.000
		Proposed Dividend	22.430	0.000	15.230
		Tax on Proposed Dividend	3.640	0.000	2.590
	BALANCE CARRIED TO THE B/S		4122.660	3120.640	2345.440
	EARNINGS IN FOREIGN CURRENCY
		Export Earnings	3678.400	3245.180	4199.590
	TOTAL EARNINGS		3678.400	3245.180	4199.590
	IMPORTS
		Raw Materials	4738.950	3187.140	3096.210
		Capital Goods and Stores & Spares	58.210	43.990	176.490
	TOTAL IMPORTS		4797.160	3231.130	3272.700
	Earnings Per Share (Rs.)
	Basic		4.63	5.81	3.57
	Diluted		4.63	4.28	2.60

QUARTERLY RESULTS

PARTICULARS	30.06.2011 1^st Quarter	30.09.2011 2^nd Quarter
Net Sales	2113.010	2925.610
Total Expenditure	1664.390	2353.100
PBIDT (Excl OI)	448.620	572.510
Other Income	0.010	45.060
Operating Profit	448.630	617.570
Interest	196.040	210.780
Exceptional Items	0.000	0.000
PBDT	252.590	406.790
Depreciation	122.530	160.860
Profit Before Tax	130.060	245.930
Tax	17.870	32.890
Provisions and contingencies	0.000	0.000
Profit After Tax	112.190	213.030
Extraordinary Items	0.000	0.000
Prior Period Expenses	0.000	0.000
Other Adjustments	0.000	0.000
Net Profit	112.190	213.030

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
PAT / Total Income	(%)	9.56	10.63	7.43
Net Profit Margin (PBT/Sales)	(%)	11.38	13.59	9.03
Return on Total Assets (PBT/Total Assets}	(%)	6.97	8.21	5.43
Return on Investment (ROI) (PBT/Networth)		0.17	0.18	0.22
Debt Equity Ratio (Total Liability/Networth)		1.44	1.30	3.12
Current Ratio (Current Asset/Current Liability)		4.04	3.70	2.82

LOCAL AGENCY FURTHER INFORMATION

Operations

During the Year:

Sales and other income are up by 25.54%.Profit before interest and depreciation is up by 12.31%.Profit after tax is up by 11.78%.

Management Discussion and Analysis

Subject (hereinafter referred to as 'Neclife', 'Nectar', 'NLL' or 'the Company') is an integrated pharmaceutical organization based in Chandigarh, India. Subject has developed sustainable production systems to manufacture high quality Cephalosporin intermediates, APIs and Formulations to meet the diverse requirements of its customer base in India and over 50 countries worldwide.

GLOBAL PHARMA

IMS Health forecasts global pharmaceutical market growth of 5- 7% in 2011 reaching $880 Billion, as compared to 4-5% in 2010. The global market value is expected to expand to $975+ billion by 2013. This growth will be driven by following factors:

· Patent expiries: In 2011, products with sales of more than $30 billion are expected to face the prospect of generic competition in the major developed markets. The full impact of patients shifting to lower-cost generic alternatives for these products, as well as other brands I their therapy classes, mostly will be felt in 2012.

· New wave of drug budget controls among brands in developed markets: Governments are pursuing an ongoing wave of budgetary control mechanisms that target drug spending as one way to restore fiscal balance. Multiple markets will be impacted by these measures in 2011.

· Pharmerging countries: The pharmerging countries are forecast to grow at a 15-17 percent rate in 2011, to $170- 180 billion contributing nearly half of total growth. Pharmerging countries comprises of India, China, Brazil, Russia, Mexico, Turkey, Poland, Argentina, Indonesia, Venezuela, Thailand, Romania, South Africa, Ukraine, Egypt, Ukraine, Vietnam and Pakistan.

· Innovative products: In 2011, the introduction and uptake of new drugs are poised to provide new treatment options and significantly alter treatment paradigms in several key therapy areas. These include innovative treatment options for stroke prevention, melanoma, multiple sclerosis, breast cancer and hepatitis C. As these new drugs are brought to market, patient access is expected to expand and funding redirected from other areas where lower-cost generics are available.

INDIAN PHARMA AND HEALTHCARE

India's pharmaceutical industry is now the third largest in the world in terms of volume and stands 14th in terms of value. According to the Department of Pharmaceuticals, Ministry of Chemicals and Fertilizers, the total turnover of India's pharmaceuticals industry between September 2008 and September 2009 was US$ 21.04 billion. Of this the dome market was worth US$ 12.26 billion.

The Indian pharmaceuticals market was estimated at about US$ 24.8 billion in 2010 and is expected to reach US$ 55 billion in 2020. The market has the further potential to reach US$ 70 billion by 2020 in an aggressive growth scenario. India has benefited from a rising middle-class population, improvements in medical infrastructure and the establishment of intellectual property rights.

According to IMS Health, the top five therapy classes of Indian Pharmaceutical market are:

· Angioten-II Antag

· Human insulin and analogs

· Cephalosporins

· Anti-ulcerants

· Oral antidiabetics

Generics

Global generics market was worth about US$ 89 billion in 2009- 10 and is expected to grow at 10% to reach US$ 135 billion by 2015.

India tops the world in exporting generic medicines worth US$ 11 billion and currently, the Indian pharmaceutical industry is one of the world's largest and most developed. Moreover, the Indian generic drug market to grow at a CAGR of around 17 per cent between 2010-11 and 2012-13.

OPPORTUNITIES AND OUTLOOK

The company expects a positive outlook for the next year. NLL is expecting its strategic entry in US market with a number of ANDA filings for its cephalosporins range during 2011-12.

The U.S. is the single largest generics market, estimated at US$ 30 billion (about 34% of global generic market), regardless of the intense competition and pricing pressure.

NLL intends to make a strategic entry into EU countries like France, Germany, UK, Italy, Spain, Poland and Hungary during 2012-13. Europe forms the world's 2nd largest generic market, estimated at about US$ 25.5 billion backed by Govt reforms to curb healthcare cost and increased demand from ageing population.

Japanese generic market was valued at about US$ 7.4 billion in 2009. In Japan, generic dispensing increased from 6.3% to 6.9% in value terms and from 18.0% to 18.9% on a volume basis in 2009. It is one of the most lucrative destinations for pharma player mainly because of the rapidly ageing population and increasing incidence of western lifestyle diseases. NLL expects future value growth from this market for Cephalosporin products along with other regulated markets such as US and EU.

NLL also expects continued momentum from its domestic and export markets. Next few years will see NLLs ability to discover new markets and new opportunities gaining an invaluable advantage over competitors. Portfolio expansion and supply chain excellence should lead to a key position in the global generics segment.

UN-AUDITED FINANCIAL RESULTS FOR THE QUARTER ENDED 30.09.2011

(Rs. In Millions)

Particulars	Quarter ended 30.09.20011	Half Year Ended 30.09.2011
Gross sales / Income from Operations	2993.720	5184.457
Less: Excise Duty	91.970	193.753
Net Sales / Income from Operations	2901.750	4990.704
Other Operating Income	23.855	47.913
Total Operating Income	2925.605	5038.617
Expenditure
(a) (Increase)/decrease in Stock in Trade	(44.493)	(61.497)
(b) Consumption of Raw Materials	2057.773	3401.021
(c) Employees Cost	123.439	247.474
(d) Depreciation	160.857	283.391
(e) Other Expenditure	216.385	430.492
Total Expenditure	2513.961	4300.881
Profit / (Loss) From Operations before other Income Interest & Exceptional Items	411.644	737.736
Other Income	45.057	45.065
Profit/(Loss) before Interest and Exceptional items	456.701	782.801
Interest	210.777	406.813
Profit / (Loss) after interest but before Exceptional items	245.924	375.988
Exceptional Items	0.000	0.000
Profit / (Loss) from Ordinary activities before tax	245.924	375.988
Tax Expenses	32.894	50.760
Net Profit/(Loss) from Ordinary activities after tax	213.030	325.228
Extraordinary Items	0.000	0.000
Net Profit/(Loss) for the period	213.030	325.228
Paid Up Equity Share Capital ( Face Value of the share Re.1/- each)	224.261	224.261
Reserves (Excluding Revaluation Reserves)
Earnings Per Share (EPS)
Basic EPS before Extraordinary items	0.95	1.45
Diluted EPS before Extraordinary items	0.95	1.45
Basic EPS after Extraordinary items	0.95	1.45
Diluted EPS after Extraordinary items	0.95	1.45
Public Shareholding
Number of Shares	124896970	124896970
Percentage of Shareholding	55.69	55.69
Promoters and Promoter group share holding
a) Pledged / Encumbered
- Number of Shares	0	0
- Percentage of share (as a % of the total shareholding of promoter and promoter group)	0.000	0.000
- Percentage of shares(as a % of the total share capital of the company)	0.000	0.000
b) Non-encumbered
- Number of Shares	99364000	99364000
- Percentage of Share (as a % of the total shareholding of promoter and promoter group)	100.00	100.00
- Percentage of Share (as a % of the total share capital of the company)	44.31	44.31

STATEMENT OF ASSETS AND LIABILITIES

(Rs. in Millions)

Particulars	30.09.2011
Shareholders Funds
Capital	224.261
Reserves and Surplus	7240.842
Loan Funds	9650.299
Deferred Tax Liabilities	558.816
Total	17674.218
Fixed Assets (Inclusive of Capital W.I.P)	8956.316
Investment	1.969
Current Assets, Loans and Advances
Inventories	4992.077
Sundry Debtors	3021.485
Cash and Bank Balances	502.937
Other Current Assets	237.581
Loans and Advances	1622.962
Less : Current Liabilities and Provisions
Current Liabilities	1545.684
Provisions	115.687
Miscellaneous Expenditure (Not written off or adjusted)	0.262
Total	17674.218

Notes:

1. The above financial results were reviewed by Audit Committee on 11.11.2011 and approved by the Board in its meeting held on even date i.e. 11.11.2011 and further limited reviewed by the Statutory Auditors of the Company.

2. The above financial results are on standalone basis M/s Chempharma Private Limited, a wholly owned subsidiary of the company stand wound up in financial year 2010-11.

3. The company is exclusively in the pharmaceutical business segment

4. The Shareholders in their Annual General Meeting held on 30 09 2011 have declared the final dividend of Re 0.10/- per equity share (10%on the face value of Re 11- per equity share)for the financial year 2010-11 The Company has despatched Dividend Warrants to the shareholders at their registered addresses, and wherever applicable, the Dividend has been credited to the shareholders' accounts directly through National Electronic Credit Settlement facility of RBI

5. Status of Complaints a) Pending at the beginning of Quarter – Nil b) Received During the Quarter – 10 c) Disposed Off During the Quarter- 10 d) Pending at the end of Quarter - Nil

Contingent Liabilities (As on 31.03.2011)

Letter of Credit (Foreign / Inland) – Rs.482.400 Millions

Bank Guarantees – Rs.4.500 Millions

Bills Discounted – Rs.39.950 Millions

Differential amount of custom duty in respect of machinery imported under EPCG Scheme – Rs.38.080 Millions

Claims not acknowledged as debts:- ** -Income Tax matters – Rs.26.590 Millions

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advance) – Rs.292.440 Millions

** The matters are subject to legal proceedings in the ordinary course of business. The legal proceedings, when ultimately concluded will not, in the opinion of management, have a material effect on the results of operation or financial position of the company.

FIXED ASSETS

· Freehold Land and Site Development

· Leasehold Land

· Buildings

· Tube Well

· Plant and Machinery

· Plant and Machinery (R and D)

· Boiler

· Pollution Control Equipment

· Laboratory

· Miscellaneous Fixed Assets

· Furniture and Fixture

· Motor Vehicles

· Computer

BUSINESS DESCRIPTION

Nectar Lifesciences Limited (NLL) is a pharmaceutical company. Nectar has developed production systems to manufacture cephalosporin intermediates, active pharmaceutical ingredients (APIs) and formulations to meet the requirements of its customer base in India and over 50 countries worldwide. The Company’s business operations are primarily concentrated on manufacturing and marketing of oral and sterile cephalosporins, phytochemicals and allied products. It manufactures and sells a range of cephalosporins and phytochemicals. Nectar is engaged in contract manufacturing of API's for pharmaceutical players besides being into formulations, empty hard gelatine capsules, generics, over-the-counter (OTC's) and diagnostics business. It principal products include cefixime trihydrate, ceftriaxone sodium sterile and cefuroxine axetil amorphous. For the fiscal year ended 31 March 2010, Subject.'s revenues increased 18% to RS8.65B. Net income increased 73% to RS915.9M. Revenues reflect an increase in income from operations and higher other income. Net income also reflects a decrease in administrative expenses and an increase in gross operating margin. The Company is engaged in the manufacture of pharmaceuticals products.

BOARD OF DIRECTORS

Sanjiv Goyal (Executive Chairman of the Board, Managing Director)

Shri. Sanjiv Goyal serves as Executive Chairman of the Board, Managing Director of Subject. He is commerce and law graduate. Shri. Sanjiv Goyal started his career by setting up a proprietary concern by the name M/S Surya Narrow fabrics in Chandigarh in 1987. Sh. Sanjiv Goyal established M/s Nectar Lifesciences Limited in 1995 and has been the managing director ever since. The company became fully operational in April 1997. Sh. Sanjiv Goyal was conferred with the "Young Innovative Entrepreneur of the Year- 2000" Award (an LMA Trident Award) by the Ludhiana Management Association (Affiliation to the All India Management Association).

Shamsher Singh Chauhan (Independent Non-Executive Director)

Dr. Major General Shamsher Singh Chauhan, VSM, is an Independent Non-Executive Director of Subject. He retired after holding the most prestigious and highest professional appointment of Senior Consultant Medicine as Head of the medicine and Allied Specialties/ Super Specialties in the Armed Forces from Ministry of Defence and Army Hospital (Research and Referral) Delhi. He has joined Defence forces on March 29, 1963 and super annuated on May 31, 1997. He did his M.B.B.S. from Government M.G. Medical College Bhopal in 1961, did Advanced Course in Medicine from A.F.M.C. Pune in 1973, M.D. (Medicine) from Pune University in 1978 and F.I.C.P. from Indian College of Physicians Bombay in 1996. He also did management courses i.e., Medical Officers Senior Command Course from O.T.S.A.M.C. Centre Lucknow in 1977 and Senior Defence Management Course from College of Defence Management Secunderabad in 1993.

Dinesh Dua (Chief Executive Officer, Executive Director)

Mr. Dinesh Dua is Chief Executive Officer, Executive Director of Subject. Prior to NLL he was the President of Wockhardt Limited, Mumbai. Mr. Dua is an-M.B.A. from IIM Ahmedabad. He has over 30 years of professional experience across varied industries such as healthcare and Pharmaceuticals, petrochemicals and consumer goods, having worked in.MNCs such as Hoechst (Sanofi-.Aventis) and Berger Paints and Indian Corporates. like Reliance and Jubilant Organosys. Prior to Wockhardt, Mr. Dua was the President of API at'Zydus Cadila Healthcare. He also served as a member of various sub-committees of the Cll and RICO, two of the industry associations of India. He-is also a visiting faculty to and reputed management institutes in India.

Basant Kumar Goswami (Independent Non-Executive Director)

Shri. Basant Kumar Goswami serves as an Independent Non-Executive Director of Subject. He holder of Masters Degree in English and secured first position in Punjab University. He joined the Indian Administrative Services in 1960 and held various positions in the government departments at various levels including the management of public sector undertakings.

Aryan Goyal (Executive Director)

Shri. Aryan Goyal serves as Executive Director of Subject. He holds a bachelors degree in Chemical Engineering and Management from PURDUE University West Lafayette, Indiana, U.S.A. Apart from Nectar Lifesciences Limited, Mr. Aryan Goyal also holds the Directorship in M/s Chempharma Private Limited, registered in Sri Lanka, a wholly owned subsidiary of the Company.

Saurabh Goyal (Executive Director)

Shri. Saurabh Goyal serves as Executive Director of Subject. He holds a masters degree in International Management from King's College London, United Kingdom.

Raman Kapur (Independent Non-Executive Director)

Mr. Raman Kapur is an Independent Non-Executive Director of Subject. Mr. Kapur received a B.A. degree in economics from Columbia College, New York and a Mater in Business Administration (MBA) degree in finance and international business from Columbia University, New York. He was Chairman and a partner of Global Pharmaceutical Services, LLC and Transition Patient Services, LLC which he co-founded after electing voluntary early retirement from Schering Plough Corporation effective January 1, 2005. Mr. Kapur had a 30 year career with Schering Plough where he served as President, Warrick Pharmaceuticals, U.S.A. and President of the World-wide Generics business of Schering-Plough Corporation. Mr. Kapur's responsibilities included the sales and promotion of a group of legacy branded products in the U.S. market. Mr. Kapur joined Schering-Plough as a financial analyst in 1975 serving in progressively more responsible finance, marketing and general management positions in the U.S. and internationally in Europe, Latin America, Middle East as well as India where he served for 5 years as Managing Director of Schering Plough's Indian subsidiary, Fulford India Limited based in Mumbai. Mr. Raman Kapur hold directorship in following companies: Innopharma, New Jersey, USA, Lifeblood Medical, New Jersey, USA, Global Pharmaceuticals Services, New Jersey, USA, Princeton Opthalmics, New Jersey, USA, Capitol Health, New Jersey, USA.

Vivek Sett (Non-Independent Non-Executive Director)

Mr. Vivek Sett is Non-Independent Non-Executive Director of Subject. He is qualified Chartered Accountant and graduated with a degree in Commerce from Calcutta University. He is the partner of New Silk Route Advisors (NSR) since February 2007 and focused on private equity opportunities in the Indian sub-continent out of the Mumbai office. He started his professional career in 1984 with Ispat Industries Limited, as a Senior Officer and was nominated to the Board of the company in 1994. He played a proactive role in the development of Ispat Group, which is today an industrial conglomerate and ranks among the top business houses in the country. In 1997 he joined the Board of Directors Hughes Telecom India Limited and was appointed Chief Financial Officer (CFO) of the company in 2001 and Chief Executive Officer in 2002 prior to the takeover of the company by the Tata group. In Tata Group, he worked as Chief Financial Officer of Tata Teleservices Limited. He supervised the finance function at Tata Teleservices Limited, which implemented a US$4.5 billion wireless telecommunication project across the country. As a CFO, Vivek Sett structured the funding of complex, capital-intensive projects and restructured distressed assets with different groups of senior lenders and creditors. Prior to joining NSR, Vivek Sett was Chief Financial Officer of Tata Realty and Infrastructure where he was mandated to lead the Tata Group's funding of a US$ 5 billion initiative to exploit the growth in the Indian Realty and Infrastructure Sectors. Mr. Vivek Sett hold directorship in following companies: New Silk Route Advisors Private Limited, New Silk Route Towers Private Limited, Infrastructure and Energy Limited, Rolex Rings Private Limited, K. S. Oils Limited, Aster Infrastructure Private Limited.

Vijay J. Shah (Independent Non-Executive Director)

Shri. Vijay J. Shah serves as Independent Non-Executive Director of Subject. He is a holder of Bachelors Degree in Commerce and Diploma in Business Administration. He has experience in managing the affairs of the corporate entities and financial matters. He is presently director of Stallion Laboratories Private Limited and Endurance Healthcare Limited.

Ajay Swaroop (Independent Non-Executive Director)

Mr. Ajay Swaroop is an Independent Non-Executive Director of Subject., since August 11, 2010. He holds B.Com., M.A. (Economics) and C.A.I.I.B. degrees. He has retired as Chief General Manager of Chandigarh circle of State Bank of India comprising of Punjab, Haryana, Himachal, Jammu and Kashmir and Chandigarh (U.T.) after 37 years of long and varied service. At the time of retirement, he was controlling Rs.780,000 million of business, 1000 branches and 14000 employees. He is presently holding Directorship in Emm Bee Financial Services Limited and Haryana State Industrial and Infrastructure Development Corporation Limited.

PRESS RELEASES

Nectar Lifesciences gets European cGMP approval for Cephalosporin formulation facility

India, December 08 -- Nectar Lifesciences (NecLife), a fast growing manufacturer of generic active pharmaceutical ingredients (APls) and formulation products has achieved another significant milestone by receiving European cGMP (Current Good Manufacturing Practices) approval for its Cephalosporin formulations manufacturing facility in Baddi, Himachal Pradesh. This approval will facilitate the company's entry into lucrative 27 European Union member states, EEU, South Africa and Middle East markets on account of mutual recognition.After receiving EU cGMP for API facility in October 2011, NecLife has received the European cGMP compliance certification for its Cephalosporin formulations facility in Baddi for injectables Cephalosporins. This approval has been received following the successful inspection by the Hungarian Authority - National Institute for Quality and Organizational Development in Healthcare and Medicines, National Institute of Pharmacy (GYEMSZI-OGYI) in June 2011. Hungary being a member of European Union, the GYEMSZI-OGYI Certificate is accepted by all EU Health Authorities and by authorities of several other countries.NecLife's Formulations facility, Unit-VI, has received this approval for Cefotaxime sodium for injection, Ceftriaxone sodium for injection and Cefuroxime sodium for injection. Together these 3 products have a market potential in excess of $1 billion in the European countries.Till date, NecLife has filed 27 Drug Master Files (DMFs) and 6 Abbreviated New Drug Applications (ANDAs). The company also has an ambitious plan of filing over 20 DMFs and multiple ANDAs/EU dossiers in US and EU markets in year 2012. These filings by NecLife will result in robust topline as well as bottom-line for the company from year 2013 onwards in view of gestation period for regulatory approvals, which take significant time in view of the current pendency.Nectar Lifesciences is a $200 million pharmaceutical organization. The company offers a range of Cephalosporin active pharmaceutical ingredients (APIs) and finished dosage forms.

European cGMP Approval for NecLife's Cephalosporin Formulation Facility

India, December 08 -- Nectar Lifesciences Limited has informed BSE regarding a Press Release dated December 08, 2011 titled "European cGMP Approval for NecLifes Cephalosporin Formulation Facility"

Nectar Lifesciences rockets on getting European cGMP approval for Cephalsporin APIs facility

India, October 14 -- Nectar Lifesciences is currently trading at Rs.22.65, up by 1.15 points or 5.35% from its previous closing of Rs. 21.50 on the BSE.The scrip opened at Rs. 21.20 and has touched a high and low of Rs.23.50 and Rs.21.05 respectively. So far 157013 shares were traded on the counter. The BSE group 'B' stock of face value Rs. 1 has touched a 52 week high of Rs. 34.85 on 05-Nov-2010 and a 52 week low of Rs.18.10 on 05-Sep-2011.Last one week high and low of the scrip stood at Rs. 23.50 and Rs.20.60 respectively. The current market cap of the company is Rs. 482.16 crore. The promoters holding in the company stood at 44.31% while Institutions and Non-Institutions held 15.72% and 19.46% respectively. Nectar Lifesciences (Nec Life) has secured European Current Good manufacturing Practices (cGMP) approval for its Cephalsporin APIs manufacturing facility in Derabassi in Punjab. The company has received European Current Good manufacturing Practives (cGMP) compliance certification for both oral and injectables Cephalsporin followed by the successful inspection by the Hungarian Authority- National Institute for Quality and Organizational development in healthcare and medicine, National Institute of Pharmacy (Gyemszi-Ogyi) in June 2011. The Gyemszi-Ogyi certificate is accepted by all EU health authorities and by authorities of several other countries. The company's API facility, Nint II, has received this approval for oral molecules like Cefixime Trihydrate and injectables molecules viz. Cefixime Hydrochloride, Cefixime Sodium, Cefixime Sodium and Cerfuroxime sodium. This approval is a testimony to the high standards of quality and compliance practices put in place by the company. This approval will facilitate exports to the lucrative generic drug markets of Europe and this certification opens up lot of opportunities for contract manufacturing for the company for European customers besides factoring in the same in its own European dossiers for both oral and injectable formulations at Baddi in Himachal Pradesh, which has also been successfully inspected by European authorities and the final approval is awaited by October 2011 end. Nectar Lifesciences is a $200 million pharmaceutical organization. The company offers a range of Cephalosporin active pharmaceutical ingredients (APIs) and finished dosage forms.

INDIA,UNITED STATES : Nectar Lifesciences gets FDA approval for APIs manufacturing plant in Punjab

Nectar Lifesciences Limited, India based integrated pharmaceutical company, obtained approval from US Food and Drug Administration (US FDA), for its Active Pharmaceutical Ingredients (APIs) manufacturing plant Unit-II in Dera Bassi.

This approval comes after recent audit by USFDA in June 2011 for Nectar Lifesciences Drug Master File - Cefuroxime Axetil.

In US, the worth of Cefuroxime Axetil is nearly US $50 million. With this approval, Nectar Lifesciences is expected to benefit through its associates.

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 records 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.51.83
UK Pound	1	Rs.79.42
Euro	1	Rs.65.90

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	5
PAID-UP CAPITAL	1~10	6
OPERATING SCALE	1~10	7
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	8
--PROFITABILIRY	1~10	8
--LIQUIDITY	1~10	8
--LEVERAGE	1~10	7
--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	YES
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		64

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	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
-	NB	New Business	-

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.