MIRA
INFORM REPORT
|
Report Date : |
30.05.2012 |
IDENTIFICATION DETAILS
|
Name : |
SEQUENT SCIENTIFIC LIMITED |
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Registered
Office : |
116, Vardhman Industrial Complex, L.B.S. Marg, Thane (west), Mumbai –
400601, |
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Country : |
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Financials (as
on) : |
31.03.2011 |
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Date of
Incorporation : |
28.06.1985 |
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Com. Reg. No.: |
036685 |
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Capital
Investment / Paid-up Capital : |
Rs.219.351 Millions |
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CIN No.: [Company Identification
No.] |
L99999MH1985PLC036685 |
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Legal Form : |
A Public Limited Liability company. The company’s Share are Listed on
the Stock Exchange. |
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Line of Business
: |
Manufacturing of active pharmaceutical ingredients (API) |
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No. of Employees
: |
673 (Approximately) |
RATING & COMMENTS
|
MIRA’s Rating : |
Ba (45) |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Maximum Credit Limit : |
USD 5000000 |
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Status : |
Exist |
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Payment Behaviour : |
Usually correct |
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Litigation : |
Clear |
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Comments : |
Subject is an established company having satisfactory track. Trade relations
are reported as fair. Business is active. Payments are reported to be usually
correct and as per commitments. The company can be considered normal for business dealings at usual
trade terms and conditions. |
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) |
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|
A1 |
A1 |
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Risk Category |
ECGC Classification |
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Insignificant |
A1 |
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Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
LOCATIONS
|
Registered Office : |
116, Vardhman Industrial Complex, L.B.S. Marg, Thane (west), Mumbai –
400601, |
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Tel. No.: |
91-22-21723357 / 21721286 |
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Fax No.: |
Not Available |
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E-Mail : |
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Website : |
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Corporate Office : |
Star II, BileKahalli, Bannerghatta Road, Bangalore – 560076,
Karnataka, India |
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Tel. No.: |
91-80-67840340 |
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Fax No.: |
91-80-67840400 |
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E-Mail : |
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Plant : |
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DIRECTORS
As on 29.11.2011
|
Name : |
Mr. K. R. Ravishankar |
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Designation : |
Chairman and Managing Director |
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Name : |
Dr. Gautam Kumar Das |
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Designation : |
Executive Director |
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Name : |
Mr. K R N Moorthy |
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Designation : |
Deputy Managing Director |
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Name : |
Mr. Joe Thomas |
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Designation : |
Director |
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Name : |
Dr. Gopakumar G. Nair |
|
Designation : |
Director |
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Name : |
Mr. Kannan Ramanujam |
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Designation : |
Director |
KEY EXECUTIVES
|
Name : |
Mr. Mahesh N |
|
Designation : |
Company Secretary |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
As on 31.03.2012
|
Names of Shareholders |
No. of Shares |
Percentage of
Holding |
|
(A) Shareholding
of Promoter and Promoter Group |
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|
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|
30,000 |
0.14 |
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15,582,936 |
71.04 |
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15,612,936 |
71.18 |
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Total
shareholding of Promoter and Promoter Group (A) |
15,612,936 |
71.18 |
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(B)
Public Shareholding |
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|
|
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|
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|
1,798,853 |
8.20 |
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1,190,197 |
5.43 |
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1,384,542 |
6.31 |
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|
1,948,663 |
8.88 |
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|
39,439 |
0.18 |
|
|
19,209 |
0.09 |
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|
23,348 |
0.11 |
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|
700,000 |
3.19 |
|
Foreign
Corporate Bodies |
1,166,667 |
5.32 |
|
|
6,322,255 |
28.82 |
|
Total
Public shareholding (B) |
6,322,255 |
28.82 |
|
Total
(A)+(B) |
21,935,191 |
100.00 |
(1) Indian
Individuals / Hindu Undivided Family
Individual shareholders holding nominal
share capital up to Rs. 0.100 millionsBUSINESS DETAILS
|
Line of Business : |
Manufacturing of active pharmaceutical ingredients (API) |
PRODUCTION STATUS As on 31.03.2011
Installed Capacity (in MT) = 3,768
|
Particulars |
Unit |
Actual
Production |
|
Bulk Drugs |
M.T |
838.01 |
GENERAL INFORMATION
|
No. of Employees : |
673 (Approximately) |
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Bankers : |
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Facilities : |
(Rs. in Millions)
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Banking
Relations : |
-- |
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Statutory Auditors : |
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Name : |
Deloitte Haskins and Sells Chartered Accountant |
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Address : |
100/2, Richmond Road, Bangalore – 560025, Karnataka, India |
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Internal Auditors: |
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Name : |
Mahajan and Aibara Chartered Accountant |
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Address : |
1, Chawla House, 62, Wodehouse Road, Colaba, Mumbai – 400005,
Maharashtra, India |
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Holding Company : |
Fraxis Life Sciences Private Limited |
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Associates : |
·
Sequent Penems Private Limited |
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Subsidiaries : |
· Sequent Global Holdings Limited, Mauritius · Sequent European Holdings Limited, Cyprus · Sequent Research Limited · Sanved Research Labs Private Limited · Vedic Fanxipang Pharma Chemic Company Limited, Vietnam · Galenica B.V., Netherlands · Codifar N.V., Belgium · Sequent Anti Biotics Private Limited · Sequent Oncolytics Private Limited · Elysian Life Sciences Private Limited · Elysian Health Care Private Limited |
CAPITAL STRUCTURE
As on 31.03.2011
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
32000000 |
Equity Share |
Rs.10/- each |
Rs.250.000 Millions |
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Issued, Subscribed & Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
21935191 |
Equity Share |
Rs.10/- each |
Rs.219.351
Millions |
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|
Less : Amount receivable from Sequent Scientific
Employee Stock option Scheme Trust (Being face Value of 700000 Equity Shares of Rs,10 each allotted to the Trust) |
|
Rs.7.000
Millions |
|
|
Total |
|
Rs.212.350
Millions |
Note: Of the above:-
i) 10,150,000 Equity shares of Rs. 10 each were allotted to the share
holders of erstwhile Sequent Scientific Limited, consequent to amalgamation
with the company.
ii) 14,865,000 (Previous year 14,865,000) Equity Shares are held by
Fraxis Life Sciences Limited, the Holding Company
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2011 |
31.03.2010 |
31.03.2009 |
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SHAREHOLDERS FUNDS |
|
|
|
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1] Share Capital |
212.350 |
212.350 |
110.850 |
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2] Employees stock options outstanding |
0.070 |
0.000 |
0.000 |
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3] Reserves & Surplus |
1043.110 |
946.290 |
485.070 |
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4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
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NETWORTH |
1255.530 |
1158.640 |
595.920 |
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LOAN FUNDS |
|
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1] Secured Loans |
1596.540 |
1306.120 |
486.080 |
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2] Unsecured Loans |
162.000 |
61.030 |
5.190 |
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TOTAL BORROWING |
1758.540 |
1367.150 |
491.270 |
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DEFERRED TAX LIABILITIES |
122.910 |
87.460 |
24.160 |
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TOTAL |
3136.980 |
2613.250 |
1111.350 |
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APPLICATION OF FUNDS |
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FIXED ASSETS [Net Block] |
1854.930 |
1179.490 |
451.720 |
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Capital work-in-progress |
324.200 |
210.290 |
28.990 |
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INVESTMENT |
138.910 |
453.860 |
240.820 |
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DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
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CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
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Inventories |
614.700
|
466.670
|
218.640 |
|
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Sundry Debtors |
643.010
|
454.740
|
195.940 |
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Cash & Bank Balances |
68.030
|
124.650
|
39.790 |
|
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Other Current Assets |
0.000
|
0.000
|
0.000 |
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Loans & Advances |
665.030
|
517.380
|
181.640 |
|
Total
Current Assets |
1990.770
|
1563.440
|
636.010 |
|
|
Less : CURRENT
LIABILITIES & PROVISIONS |
|
|
|
|
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Sundry Creditors |
865.980
|
565.850
|
150.360 |
|
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Other Current Liabilities |
47.450
|
12.190
|
9.460 |
|
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Provisions |
258.400
|
215.790
|
86.370 |
|
Total
Current Liabilities |
1171.830
|
793.830
|
246.190 |
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Net Current Assets |
818.940
|
769.610
|
389.820 |
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MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
0.000 |
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TOTAL |
3136.980 |
2613.250 |
1111.350 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
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|
SALES |
|
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|
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Income |
2777.560 |
2463.350 |
1060.620 |
|
|
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Other Income |
116.340 |
72.870 |
17.920 |
|
|
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TOTAL (A) |
2893.900 |
2536.220 |
1078.540 |
|
|
|
|
|
|
|
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Less |
EXPENSES |
|
|
|
|
|
|
|
Materials Consumed |
1531.730 |
1114.600 |
562.560 |
|
|
|
Increase/Decrease in Stock |
(129.140) |
(77.220) |
(55.090) |
|
|
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Personnel Cost |
227.030 |
202.050 |
87.310 |
|
|
|
Operating and other expenses |
668.100 |
623.070 |
345.050 |
|
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TOTAL (B) |
2297.720 |
1862.500 |
939.830 |
|
|
|
|
|
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Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
596.180 |
673.720 |
138.710 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
212.750 |
187.310 |
41.930 |
|
|
|
|
|
|
|
|
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|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
383.430 |
486.410 |
96.780 |
|
|
|
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|
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Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
171.810 |
125.220 |
41.440 |
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|
|
|
|
|
|
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PROFIT BEFORE TAX
AND EXCEPTIONAL ITEMS |
211.620 |
361.190 |
55.340 |
|
|
|
|
|
|
|
|
|
|
Diminution in
investment in subsidiaries / Written Back |
52.580 |
(57.500) |
0.000 |
|
|
|
|
|
|
|
|
|
|
Encashment of
bank guarantee |
(42.050) |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
222.150 |
303.690 |
55.340 |
|
|
|
|
|
|
|
|
|
Less |
TAX (I) |
62.830 |
95.760 |
20.160 |
|
|
|
|
|
|
|
|
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|
PROFIT AFTER TAX
(G-I) (J) |
159.320 |
207.930 |
35.180 |
|
|
|
|
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|
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|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
296.420 |
129.240 |
108.030 |
|
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|
|
|
|
|
|
|
|
Included
on Amalgamation |
(38.850) |
24.530 |
0.000 |
|
|
|
|
|
|
|
|
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Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Transfer to General Reserve |
7.970 |
15.590 |
1.000 |
|
|
|
Dividend |
32.900 |
42.470 |
11.090 |
|
|
|
Tax on Dividend |
5.460 |
7.220 |
1.880 |
|
|
BALANCE CARRIED
TO THE B/S |
370.560 |
296.420 |
129.240 |
|
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EARNINGS IN
FOREIGN CURRENCY |
|
|
|
|
|
|
|
Export Earnings |
1147.840 |
1059.860 |
625.610 |
|
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TOTAL EARNINGS |
1147.840 |
1059.860 |
625.610 |
|
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|
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IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
439.110 |
340.830 |
251.480 |
|
|
|
Capital Goods |
17.430 |
0.000 |
0.000 |
|
|
TOTAL IMPORTS |
456.540 |
340.830 |
251.480 |
|
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|
|
|
|
|
|
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|
Earnings Per
Share (Rs.) |
7.26 |
9.79 |
3.17 |
|
QUARTERLY RESULTS
|
PARTICULARS |
30.06.2011 1st
Quarter |
30.09.2011 2nd
Quarter |
31.12.2011 3rd
Quarter |
|
Type |
Unaudited |
Unaudited |
Unaudited |
|
Net Sales |
686.150 |
891.940 |
749.200 |
|
Total Expenditure |
613.950 |
887.680 |
686.070 |
|
PBIDT (Excl OI) |
72.200 |
4.260 |
63.130 |
|
Other Income |
61.340 |
4.940 |
14.640 |
|
Operating Profit |
133.54 |
14.200 |
77.770 |
|
Interest |
69.760 |
70.22 |
70.170 |
|
Exceptional Items |
0.000 |
0.000 |
0.000 |
|
PBDT |
63.780 |
(56.020) |
7.600 |
|
Depreciation |
44.280 |
45.900 |
67.210 |
|
Profit Before Tax |
19.500 |
(101.920) |
(59.610) |
|
Tax |
14.510 |
3.120 |
(30.970) |
|
Provisions and contingencies |
0.000 |
0.000 |
0.000 |
|
Profit After Tax |
4.990 |
(105.040) |
(28.630) |
|
Extraordinary Items |
0.000 |
0.000 |
0.000 |
|
Prior Period Expenses |
0.000 |
0.000 |
0.000 |
|
Other Adjustments |
0.000 |
0.000 |
0.000 |
|
Net Profit |
4.990 |
(105.040) |
(28.630) |
KEY RATIOS
|
PARTICULARS |
|
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
PAT / Total Income |
(%) |
5.51
|
8.20
|
3.26 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
7.99
|
12.33
|
5.22 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
11.16
|
11.07
|
5.09 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.18
|
0.26
|
0.09 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
0.93
|
1.87
|
1.24 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
1.69
|
1.97
|
2.58 |
LOCAL AGENCY FURTHER INFORMATION
|
Check List by Info Agents |
Available in Report (Yes / No) |
|
1) Year of Establishment |
Yes |
|
2) Locality of the firm |
Yes |
|
3) Constitutions of the firm |
Yes |
|
4) Premises details |
No |
|
5) Type of Business |
Yes |
|
6) Line of Business• |
Yes |
|
7) Promoter’s background |
No |
|
8) No. of employees |
Yes |
|
9) Name of person contacted |
Yes |
|
10) Designation of contact person |
Yes |
|
11) Turnover of firm for last three years |
Yes |
|
12) Profitability for last three years |
No |
|
13) Reasons for variation <> 20% |
-- |
|
14) Estimation for coming financial year |
No |
|
15) Capital in the business |
Yes |
|
16) Details of sister concerns |
Yes |
|
17) Major suppliers |
No |
|
18) Major customers |
No |
|
19) Payments terms |
No |
|
20) Export / Import details (if applicable) |
No |
|
21) Market information |
-- |
|
22) Litigations that the firm / promoter |
-- |
|
23) Banking Details |
Yes |
|
24) Banking facility details |
Yes |
|
25) Conduct of the banking account |
-- |
|
26) Buyer visit details |
-- |
|
27) Financials, if provided |
Yes |
|
28) Incorporation details, if applicable |
Yes |
|
29) Last accounts filed at ROC |
Yes |
|
30) Major Shareholders, if available |
No |
|
Stamp
No: WPST/10580/2012 Filling
Date: 17.04.2012 Reg. No.: WP/4036/2012 Reg. Date: 02.05.2012 Petitioner:
Shri. Channappa Rajjappa Ramoshi Respondent: M/S. SEQUENT SCIENTIFIC
LTD AND ORS Petn.
Adv: Sandeep R Karnik District:
Thane Bench:
Single Status:
Pre- Admission Next
Date: 28.06.2012 Coran:
According to Sitting List Act:
M.R.T.U AND P.U.L.P. Act |
BOARD
OF DIRECTORS
K.R. Ravishankar
Chairman &
Managing Director
Mr. K.R. Ravishankar has been in the pharmaceutical business for over 20 years. He started as an entrepreneur, and then joined Strides Arcolab Limited as co-promoter in 1991. He was Executive Director of Strides Arcolab Limited till he resigned from the executive post in December 2007 (he continues on the Board of Strides Arcolab Limited). He took over as CMD of Sequent Scientific Limited in January 2008
KRN Moorthy
Deputy Managing
Director
Mr. KRN Moorthy has been appointed as an Additional Director on the Board and is also the Deputy Managing Director of the Company. He oversees the entire functions of Procurement, Sales and Marketing, Business Development, Finance and HR. He is a Ranker and Masters in Mathematics, has completed his CA Inter and is a MBA from IIM Calcutta. His last entire 34 years has been spent in the Pharmaceutical industry in various positions. Over these years, he has built up rich experience and knowledge in the areas of Marketing, Sales, Finance, Projects, Manufacturing, HR and General Management. In his immediate previous assignment at Wanbury Limited, KRN was the Joint Managing Director. He was instrumental in leading a very successful turnaround of the Wanbury group companies and helped Wanbury in achieving marketing leadership in the products, which it produces.
Dr. Gautam Kumar Das
Executive Director
Dr. Gautam Kumar Das is an Executive Director on the Board and has over thirty years of in depth experience in the pharmaceutical industry. Dr. Das has extensive experience in R&D, Plant Operations, Project Management, Material Management, Resource Management and Man Management. He has a proven track record in developing several cost effective processes, driving these processes from the laboratory to the plant and increasing productivity of plants. Dr. Das, a Doctorate in Synthetic Organic Chemistry from IIT Kharagpur, has authored several publications on chemical processes. In his immediate previous assignment, Dr. Das was with Orchid Chemicals & Pharmaceuticals Limited., Chennai as President – API.
Dr. Gopakumar G. Nair
Independent Director
Dr. Gopakumar Nair is an Independent Director on the Board. With his 40 years experience and knowledge in pharmaceutical and chemical industry at different levels and positions like Director, Chairman & Managing Director, as well as Past- President of Indian Drug Manufacturers’ Association, Dr. Gopakumar Nair had the opportunity to familiarise himself with GATT, WTO, TRIPs and other IP laws over the years. It is with this wealth of experience that Dr. Nair became an IP/ Patent practitioner under the name Gopakumar Nair Associates.
Dr. Gopakumar G. Nair
Independent
Director
Dr. Gopakumar Nair is an Independent Director on the Board. With his 40 years experience and knowledge in pharmaceutical and chemical industry at different levels and positions like Director, Chairman & Managing Director, as well as Past- President of Indian Drug Manufacturers’ Association, Dr. Gopakumar Nair had the opportunity to familiarise himself with GATT, WTO, TRIPs and other IP laws over the years. It is with this wealth of experience that Dr. Nair became an IP/ Patent practitioner under the name Gopakumar Nair Associates.
Kannan Ramanujam
Independent
Director
Mr. Kannan Ramanujam, a Chartered Accountant by qualification has over 24 years of business and professional experience. He is the Promoter, CEO and Managing Director of Emerge Learning Services Limited, a public limited company in learning space. The company offers complete solutions in Education, Training, e-governance and Information management areas. Kannan has been the Director of Everonn Systems India Limited, one of the few listed Education companies in India. He is an Independent Director on the Board.
BUSINESS PERFORMANCE
REVIEW
On standalone basis, the company posted a 12.8% growth in the total revenues, from Rs.2463.350 Millions in 2009-10 to Rs 2777.560 Millions in 2010-11. The company posted an EBIDTA of Rs.596.000 Millions as against Rs 673.000 Millions in 2009-10.
On a standalone level, the Company made a PAT of Rs.159.330 Millions. On consolidated basis, the company posted a 9.6% growth in the total revenues, from Rs.2844.480 Millions in 2009-10 to Rs.3116.650 Millions in 2010-11. The company posted an EBIDTA of Rs.522.000 Millions as against Rs.849.000 Millions in 2009-10. On a consolidated level, the Company made a loss of Rs.40.240 Millions.
The company caters to two major segments –
Pharmaceuticals Division (consisting of API, CRAMS and Veterinary Formulations businesses) accounted for 85.6 per cent of the company’s revenues while the Specialty chemicals divisions accounted for 14.4 per cent.
During the year, the Company forayed in to four new therapeutic segments – Penems, Penicillin, Oncology and Phy to-Pharmaceutical/Herbal Extracts. The company signed a Memorandum of Understanding with Government of Karnataka to set up three new Greenfield facilities in Bangalore, for which it will invest Rs.1500.000 Millions
Detailed analysis of the operational and financial performance for the year is covered under the ‘Management Discussion & Analysis’ section.
SHARE CAPITAL
Pursuant to the approval of the Scheme of Amalgamation for merger of Vedic Elements Private Limited, which as a wholly owned subsidiary of the Company with the Company, the Authorised Share Capital of the Company enhanced by Rs.70.000 Millions during the year. As at March 31, 2011, the authorized capital of the Company stood at Rs.320.000 Millions as against Rs.250.000 Millions as at March 31, 2010.
There was no change in the Issued, subscribed and paid up equity capital which stood at Rs.219.350 Millions.
SUBSIDIARIES
The Company has a total of 11 subsidiaries as at March 31, 2011. They are:
1. Sequent Global Holdings Limited, Mauritius
2. Sequent European Holdings Limited, Cyprus
3. Sequent Research Limited
4. Sanved Research Labs Private Limited
5. Vedic Fanxipang Pharma Chemic Company Limited, Vietnam
6. Galenica B.V., Netherlands
7. Codifar N.V., Belgium
8. Sequent Anti Biotics Private Limited
9. Sequent Oncolytics Private Limited
10. Elysian Life Sciences Private Limited
11. Elysian Health Care Private Limited
MERGER OF FRAXIS LIFE
SCIENCES LIMITED WITH THE COMPANY
The Company is in the process of merging Fraxis Life Sciences Limited, a promoter group Company with that of the Company. The merger was approved by the shareholders at their meeting held on March 15, 2011 and final order from the Hon’ble High Court of Judicature at Bombay is awaited.
On approval, Company will allot 14,865,000 equity shares to the shareholders of Fraxis Life Sciences Limited and the shares held by Fraxis Life Sciences Limited in the Company will stand cancelled.
INDUSTRY OVERVIEW
Global overview
The global pharmaceutical market in 2010 registered a growth of 4.3 per cent to US$ 791.4 billion (Billion), driven by low-cost factors, increasing prevalence of diseases, rising per capita income and stronger near-term growth in pharmerging markets like Asia and Latin America. North America continued to dominate with a share of 42.3 per cent followed by Europe with a share of 29.2 per cent. Latin America accounted for 5.3 per cent of the total global revenues but registered a 16.3 per cent growth during 2010, making it the fastest growing market region.
Although patent expirations and limits on drug spending can hamper growth of drug sales in developed countries, global pharmaceutical sales are nonetheless expected to grow 5–7 per cent in 2011 to reach a market value of US$ 880 Billion. Most of this growth is expected to come from the ‘pharmerging’* markets, which are expected to grow at 15–17 per cent to US$ 170–180 Billion, boosted by greater government spending on healthcare. A great majority of the expansion is driven by explosive growth in China, the world’s third-largest market for pharmaceutical sales. A great slowdown is expected in the five major European markets (France, Germany, Italy, Spain and the UK), along with Canada, with minimal growth of 1–3 per cent. The US will continue to remain the single largest pharmaceutical market, with sales of US$ 320–330 Billion, up 3–5 per cent.
Generics
In FY10, global generic market was estimated to be worth US$ 89 Billion; of which, US accounted ~42 per cent (US$ 37.4 Billion) of market. According to industry estimates, the total global generics market is projected to expand to US$ 135-150 Billion, with CAGR of ~10 per cent by 2015.
From FY05 to FY10, export of drugs from India has increased at a CAGR 18.7 per cent to US$ 9 Billion. Out of this India exported 23.5 per cent (US$ 2 Billion) of total pharma exports to North America in FY10.
The US administration’s healthcare bill provides affordable healthcare to about 32 Million people of hitherto uninsured Americans, which means increased use of generic drugs due to the cost and viability factor, accelerating generic growth in the coming years.
The Indian companies account for 15.4 per cent (November 2010 IMS data) of the US generics market. Indian companies continue to gain market share, and the incremental prescription market share for Indian companies is 33.7 per cent.
INDIAN OVERVIEW
India’s pharmaceutical sector can be classified into three broad market segments namely Contract Research and Manufacturing Services (CRAMS), Formulations, and Active Pharmaceutical Ingredients (APIs).
The Indian pharmaceutical Industry has witnessed robust growth, being valued at around Rs.550.000 Billion in 2005 to over Rs.1.000 Trillion in 2010-11. The growth has stemmed from variousfactors - knowledge, skills, low cost, improved quality and huge demand from both domestic as well as international markets. During 2010-11, exports accounted for nearly 42 per cent of the total industry size at Rs.420.000 Billion. For the seven-year period (2003-2010), the domestic sale has grown at compound annual growth rate (CAGR) of 10.7 per cent, whereas exports have grown faster at CAGR of 19.0 per cent.
The Indian Pharmaceutical sector has more than 10,000 manufacturers in the country. It has expanded drastically
in the last two decades. The leading 250 pharmaceutical companies control 70 per cent of the market with market
leader holding nearly 7.0 per cent of the market share. In the Asia-Pacific pharmaceuticals market, India holds a share of 6.6 per cent.
The pharmaceutical industry in India meets around 70 per cent of the country’s demand for bulk drugs, drug intermediates and 95 per cent of the demand of pharmaceutical formulations, chemicals, tablets, capsules, orals and injectibles. There are about 250 large units and about 8,000 Small Scale Units, which form the core of the pharmaceutical industry in India (including 5 Central Public Sector Units). These units produce the complete range of pharmaceutical formulations, i.e., medicines ready for consumption by patients and about 350 bulk drugs, i.e., chemicals having therapeutic value and used for production of pharmaceutical formulations.
INDIAN GENERICS
MARKET
In the part five years, the Indian pharmaceutical industry has emerged among the world’s key markets. Generics have played a key role in this evolution. India – with a contribution of ~22 per cent in terms of value towards the global generic drug market, also is the leading exporter of generic medicines in the world, valued around US$ 11 Billion. Indian firms manufacture about 60,000 generic brands across 60 therapeutic categories. The branded generics market will continue to dominate the Indian pharmaceutical industry. 61 drugs worth US$80 Billion will go off patent at the US Patent and Trademark Office between 2011 and 2013. Indian pharmaceutical industry is all set to gain from the patent expiry of some blockbuster drugs by producing their generic equivalents. The Indian generic drug market is expected to grow at a CAGR of around 17 per cent between 2010-11 and 2012-13.
APIs
Bulk drugs are the active pharmaceutical ingredients (APIs), which are used for the manufacture of formulations. According to estimates, the proportion of formulations and bulk drugs is in the ratio of 75:25. More than 85 per cent of the formulations produced in the country are sold in the domestic market. India is largely self-sufficient in case of formulations, though some life saving, new-generation technology- barrier formulations continue to be imported.
The bulk drug industry meets the domestic requirement to an extent of about 70 per cent. Indian companies are leveraging their strength in organic synthesis, process engineering and commercially viable manufacturing technologies to produce new range of bulk drugs. It has been partially in developing cost, partially successful in developing cost effective technology for Drug Intermediates, although the industry continues to depend on China and other developed countries to an extent of 30 per cent of their requirement of Drug Intermediates.
The generics push being witnessed by the global pharmaceutical industry due to patent expiries as well as Government pressure to reduce healthcare costs is aiding the growth of the Bulk Drug exports industry in India. In addition, price erosion of generics and decreasing R&D productivity is causing global companies to cut costs and outsource manufacturing of Bulk Drugs to cost effective destinations such as India.
Lifestyle diseases –
to increase in India
By 2015, the specialty and super-specialty therapies will account for 45 per cent of the pharma market. The growing lifestyle disorders, particularly metabolic disorders like diabetes and obesity as well as coronary heart disease and hypertension, cardiovascular, neuropsychiatry and oncology drugs will gain considerable significance.
India is key market
Global pharma players continue to penetrate the burgeoning emerging markets by acquisition of domestic generics and manufacturing companies, which accounted for nearly 50 percent of M&A targets for deals made during 2008 to 2010 in the emerging markets (compared to 21 percent of targets in North America, Europe, Australia and Japan). The importance of India as a key market as well as a preferred manufacturing destination was cemented with global pharma companies acquiring Indian pharma giants during 2010-11.
CRAMS
Approximately 64 per cent of the estimated US$ 67 Billion global CRAMS market in 2010 is dominated by contract manufacturing, which includes manufacturing of intermediates for new chemical entities (NCEs) or manufacturing of APIs. Contract Research predominantly consists of drug discovery, preclinical and clinical research and represent US$ 25 Billion opportunity globally It is estimated that currently only ~20 per cent of global Pharma R&D spend is being outsourced. This represents a huge opportunity for the Indian Companies.
CORPORATE PERFORMANCE
REVIEW
Background
About the Company
Subject is a fast growing pharmaceuticals company having presence in Human and Veterinary segments. In 2007, first generation entrepreneurs, each having more than a decade’s experience, acquired Sequent Scientific Limited. The Company has evolved into an integrated player in the pharmaceuticals segment, with footprints in API (Human and Veterinary), Formulations (Veterinary) and CRAMS. Besides, the Company is also a leading producer of specialty chemicals. The Company has seven units across the country, including two state-of-the-art R&D centres – in Mangalore and Bengaluru. Sequent is the leading producer of Anthelmentic APIs in the world.
The year 2010-11
During the year 2010-11, the Company continued to build upon its robust foundation laid over the years. The Company focused on building key strengths that would define its competitive advantage across each vertical of presence. Being a diverse Company, it was important to define its core businesses that would drive the future growth. As a result, the Company continued to build its pharmaceutical business in terms of people, products, processes and presence. The Company’s new R&D centre also commenced operations in Bangalore during the year.
The Company filed 7 new drug master files, taking the total DMFs filed as on 31st March, 2011 to 28.
The Company’s edge on chemistry and research skills backed with its world-class infrastructure enabled it to increase its client base and forge product specific partnerships. The Company’s clientele include the global pharma companies, highlighting its value-proposition and abilities as a niche player.
2010-11 also witnessed a dip in the Company’s financial performance for the first time since its incorporation. While the Company’s net sales increased by 12.8 per cent to Rs.2778.000 Million; EBIDTA declined by 11.6 per cent to Rs.596.000 Millions. The Company’s net profit also declined by 23.4 per cent to Rs.159.000 Million. The dip in the numbers was largely on account of absence of Oseltavimir sales during the year. In 2009-10, in the wake of Swine Flu, the Company produced and sold Oseltavimir, an API that commanded decent margins. In absence of such an opportunity during 2010-11, the margins as well as the profit of the Company witnessed a decline. However, on an apple-to-apple comparison, the Company’s revenues increased by 43 per cent and EBITDA registered a 54 per cent increase (non-Oseltavimir revenues).
UNAUDITED FINANCIAL RESULTS FOR THE QUARTER ENDED 31st
DECEMBER, 2011
|
|
|
|
|
|
Rs in Millions |
|
|
|
Particulars |
Quarter Ended |
Quarter Ended |
Nine Months
Ended |
||
|
|
31.12.2011 |
30.09.2011 |
31.12.2011 |
|||
|
|
(Unaudited) |
(Unaudited) |
(Unaudited) |
|||
|
1 |
(a) Net Sales/Income from Operations |
749.200 |
891.940 |
2327.290 |
||
|
|
(b)Other Operating Income |
0.000 |
0.000 |
0.000 |
||
|
|
Total Revenue |
749.200 |
891.940 |
2327.290 |
||
|
2 |
Expenditure |
|
|
|
||
|
|
(a) |
Increase/(Decrease) in Stock-in-trade and work in progress |
3.730 |
(62.120) |
(37.300) |
|
|
|
(b) |
Consumption of raw materials |
400.581 |
570.061 |
1325.622 |
|
|
|
(c) |
Purchase of traded Goods |
17.379 |
26.589 |
59.738 |
|
|
|
(d) |
Conversion Chrges |
13.960 |
19.638 |
55.560 |
|
|
|
(e) |
Employees Cost |
58.180 |
68.680 |
190.080 |
|
|
|
(f ) |
Depreciation |
67.207 |
45.898 |
157.380 |
|
|
|
(g) |
Other Expenditure |
192.240 |
264.832 |
589.920 |
|
|
|
|
Total (Any item exceeding 10% of the total Expenditure to be shown
separately) |
753.277 |
933.578 |
2341.000 |
|
|
3 |
|
Profit from operation before other income, interest and other
exceptional items(1-2) |
(4.077) |
(41.638) |
(13.710) |
|
|
4 |
|
Other Income |
14.640 |
9.940 |
81.840 |
|
|
5 |
|
profit before interest and exceptional items(3+4) |
10.563 |
(31.698) |
68.130 |
|
|
6 |
Interest |
70.170 |
70.220 |
210.150 |
||
|
7 |
Profit after interest but before exceptional items(5-6) |
(59.607) |
(101.918) |
(142.020) |
||
|
8 |
Exceptional Items |
-- |
-- |
-- |
||
|
9 |
Profit(+)/Loss(-) from Ordinary Activities before tax (7-8) |
(59.607) |
(101.918) |
(142.020 |
||
|
10 |
Tax Expenses |
(30.974) |
3.117 |
(13.350) |
||
|
11 |
Net Profit(+)/Loss(-) from Ordinary Activities after tax( 9-10) |
(28.633) |
(105.035) |
(128.670) |
||
|
12 |
Extra Ordinary Items |
-- |
-- |
-- |
||
|
13 |
Net Profit(+)/Loss(-) for the period (1112) |
(28.633) |
(105.035) |
(128.670) |
||
|
14 |
Paid-up Equity Share Capital Rs.2/ per share |
212.350 |
212.350 |
212.350 |
||
|
15 |
Reserves excluding revaluation reserves |
-- |
-- |
-- |
||
|
16 |
Earning Per Share |
|
|
|
||
|
(a) |
Basic and diluted EPS before Extraordinary items for the period, for
the year to date and for the previous year(not to be annualised) |
(1.31) |
(4.79) |
(5.87) |
||
|
(b) |
Basic and diluted EPS after
Extraordinary items for the period, for the year to date and for the previous
year(not to be annualised) |
(1.31) |
(4.79) |
(5.87) |
||
|
17 |
Public Shareholding |
|
|
|
||
|
|
Number of Shares |
9745212 |
6028969 |
9745212 |
||
|
|
Percentage of Shareholding |
44.43% |
27.49% |
44.43% |
||
|
18 |
Promoters and Promoter group |
|
|
|
||
|
|
a) Pledged/Encumbered |
|
|
|
||
|
|
Number of shares |
1000000 |
10300000 |
1000000 |
||
|
|
Percentage of Shares (as a % of the total shareholding of promoter and
promoter group) |
8.20% |
64.75% |
8.20% |
||
|
|
Percentage of Shares (as a % of the total share capital of the
Company) |
4.56% |
46.96% |
4.56% |
||
|
|
b) Non-encumbered |
|
|
|
||
|
|
Number of shares |
11189979 |
5606222 |
11189979 |
||
|
|
Percentage of Shares (as a % of the total shareholding of promoter and
promoter group) |
91.80% |
35.25% |
91.80% |
||
|
|
Percentage of Shares (as a % of the total share capital of the
Company) |
51.01% |
25.55% |
51.01% |
||
Note:
Notes:
1. The unaudited financial results were taken
on record by the Board of Directors at its meeting held on February 09, 2012.
2. The Statutory Auditors have performed a limited
review of the standalone financial results for the period ended as on December
31, 2011 of the Company as required by Clause 41 of the Listing Agreement.
3. The Scheme of Amalgamation of Fraxis Life
Sciences Limited ("Transferor Company") with the Company
("Transferee Company") has been sanctioned by the High Court of
Bombay on August 20,2011 with the appointed date and effective date being
September 14, 2011, the date on which the sanctioned Scheme is filed by the
Company with the Registrar of Companies, Mumbai ("the Scheme"). In
terms of the Scheme:
a) The amalgamation has been accounted for
under the Purchase Method of accounting as specified in Accounting Standard
(AS) - 14 accounting tor Amalgamations, notified by the Central Government of India
under the Companies (Accounting Standards) Rules, 2006.
b) All the assets and liabilities of the
Transferor Company have been recorded by the Transferee Company at their
respective carrying amounts as appearing in the books of the Transferor Company
as on the appointed date.
c) The investment in the equity share capital
of the Transferee Company as appearing in the books of accounts of the
Transferor Company stands cancelled and accordingly, the share capital of the
Transferee Company shall stand reduced to the extent of face value of shares
held by the Transferor Company in the Transferee Company as on the appointed
date.
d) In accordance with the scheme, the Board
of Directors of the Transferee Company have approved the issue and allotment of
14,865,000 number of equity shares at par of the Transferee Company to the
respective shareholders of the Transferor Company in the proportion of their
shareholding in the Transferor Company.
e) The excess of the value of the net assets
of the Transferor Company acquired by the Transferee Company over the face
value of the shares issued by the Transferee Company as consideration to the
shareholders of the Transferor Company and after adjusting for cancellation of
equity share capital as mentioned in c above is treated as Capital Reserve
amounting to Rs.6.243 Millions (net of merger expenses).
f) All costs, charges, taxes including
duties, levies and all other expenses, if any arising out of, or incurred in
carrying out and implementing the Scheme and to put it into operation has been
borne by the Transferee Company and has been adjusted against the Capital
Reserve.
4. During the year ended March 31, 2011 the
Scheme of amalgamation of Vedic Elements Private Limited ("Transferor
Company") with the Company (Transferee Company") with an appointed
date of October 1, 2009. (The Scheme"), was sanctioned by the High Court
of Karnataka and came into effect on 07 September 2010. In terms of the Scheme:
a) Upon the scheme becoming effective, the
assets and liabilities of the Transferee Company have been revalued based on
valuation report or fair value determined by the Board of Directors of the
Company and the net surplus of Rs.341.080 Millions arising out of such
valuations (over the carrying value of the respective assets and liabilities
prior to the valuation) have been credited to the Restructuring Reserve
account.
b) The deficit arising on amalgamation of
Rs.337.020 Millions representing the value of assets over the value of
liabilities of the Transferor Company, after cancellation of capital of the
transferor Company and the reserves recorded has been set-off against
Restructuring reserve account.
c) Had the Scheme not provided for fair
valuing the assets and liabilities of the Transferee Company, the effect of
accounting as per the Accounting standards issued under the Companies
(Accounting Standards) Rules, 2006 for the previous year ended March 31,2011,
would have been as under:
1) Depreciation expenses would have been
lower by Rs.8.160 Millions, provision for 'Other than temporary impairment in
investments’ would have been higher by Rs.34.780 Millions. Decrease in income
from exceptional item lower by Rs.57.500 Millions. The resultant impact on
profit after tax for the year ended March 31, 2011 being lower by Rs.84.120
Millions.
2) Earning Per Share (EPS) (Face Value of
Rs.10 each) Year Ended 31-Mar-11
Basic (Rs.)
3.43
Diluted (Rs.)
3.43
5. Details of investor complaints for the
quarter ended 31st Dec 2011:
Unresolved at the beginning of the quarter : Nil
Received during the quarter: 1
Disposed off during the quarter: 1
Unresolved at the end of quarter: Nil
6. The Company has exercised the option of
capitalising the exchange difference on account of restatement of term loans
taken in foreign currency as per Notification issued by Ministry of Corporate
Affairs dated 29th December 2011. Accordingly Rs.42.640 Millions (including
Rs.23.621 Millions relating to earlier quarters) has been capitalised under
respective assets categories and depreciated over the remaining useful life of
the assets. The Depreciation includes Rs.2.530 Millions on account of such
exchange differences capitalised. Consequently the loss before tax for the
quarter and period ended 31 December 2011 is lower by Rs.40.111 Millions.
7. On February 3, 2012, there was a fire
accident at the Panoli plant of the Company. The cause of fire is being
investigated and the damage on account of the accident is being assessed for
which the Company has adequate insurance cover. "
8. Segment Results
The company has identified Pharmaceuticals
and Specialty Chemicals as its business segments. Segments have been identified
taking in to account the nature of products, the differing risks and returns,
the organisational structure and the internal reporting system
|
|
|
|
|
|
Rs in Millions |
|
|
Particulars |
Quarter ended |
Quarter ended |
Year to date |
|
|
|
31.12.2011 |
30.09.2011 |
31.12.2011 |
||
|
|
(Unaudited) |
(Unaudited) |
(Unaudited) |
||
|
1 |
Segment Revenue |
|
|
|
|
|
|
a) Pharmaceuticals |
630.099 |
771.538 |
1988.392 |
|
|
|
b) Specialty Chemicals |
119.101 |
120.402 |
338.98 |
|
|
|
Total |
749.200 |
891.940 |
2327.290 |
|
|
|
Less: Intersegment
Revenue |
-- |
-- |
-- |
|
|
|
Net Salas/Income
from Operations |
749.200 |
891.940 |
2327.290 |
|
|
2 |
Segment Result |
|
|
|
|
|
|
Profit or Loss before Tax
and interest from Each Segment |
|
|
|
|
|
|
a) Pharmaceuticals |
(47.868) |
12.367 |
(16.593) |
|
|
|
b) Specialty Chemicals |
22.333 |
15.760 |
63.13 |
|
|
|
Total |
(25.535) |
28.127 |
46.580 |
|
|
|
Less I) Finance Cost |
70.158 |
70.215 |
210.137 |
|
|
|
II) Other unallocable
expenditure net off unallocable income |
(36.086) |
59.830 |
(21.537) |
|
|
|
Total Profit Before Tax |
(59.607) |
(101.918) |
(142.020) |
|
|
|
Capital Employed |
|
|
|
|
|
|
a) Pharmaceuticals |
4361.314 |
4204.846 |
4361.314 |
|
|
|
b) Specialty Chemicals |
321.580 |
257.888 |
321.580 |
|
|
|
c) Unallocable |
(1423.234) |
(1289.553) |
(1423.234) |
|
|
|
Total |
3259.660 |
3173.181 |
3259.660 |
|
9. Figures for
previous periods may have been regrouped and rearranged, wherever necessary, to
confirm to the relevant current period classification.
FIXED ASSETS:
- Land Development
- Leasehold Property – Development
- Building
- Furniture and Fixtures
- Office Equipment and Computers
- Plant and Machinery
- Motor Vehicles
- Intangible assets
CMT REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts,
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.55.58 |
|
|
1 |
Rs.87.14 |
|
Euro |
1 |
Rs.69.73 |
INFORMATION DETAILS
|
Report Prepared
by : |
KVT |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
5 |
|
PAID-UP CAPITAL |
1~10 |
5 |
|
OPERATING SCALE |
1~10 |
5 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
5 |
|
--PROFITABILIRY |
1~10 |
5 |
|
--LIQUIDITY |
1~10 |
5 |
|
--LEVERAGE |
1~10 |
5 |
|
--RESERVES |
1~10 |
5 |
|
--CREDIT LINES |
1~10 |
5 |
|
--MARGINS |
-5~5 |
-- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
YES |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
NO |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
45 |
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 |
- |
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.