optimal efficiencies strategic expansion strong growth · ahlcon parenterals (india) limited 18th...

Ahlcon Parenterals (India) Limited18th Annual Report 2009-10

Optimal Efficiencies Strategic Expansion Strong Growth

BOARD OF DIRECTORS

CONTENTS

To be one of the world's leading and most admired

pharmaceutical companies in the global generics

industry. To continually create value and bring pride to our

stakeholders, partners, customers and the community at

large. To preserve earth's most precious resource…

“Human Lives”

Vision Statement

Mission

Achieved in a manner of fairness, honesty and corporate responsibility.

A world class organization built on,

· Outstanding performance led by entrepreneurial culture.

· Product quality through emotional pharmacopoeia.

· Management capability, efficient processes and technology.

· Youth, hard work and discipline.

Vision Statement Ahlcon's Diary Chairman's Message

Notice Directors' Report Management Discussion & Analysis Report

Report on Corporate Governance Auditors' Report Balance Sheet

Profit and Loss Account Schedules Cash flow statement

Balance sheet abstract

01 02 08

10 14 18

21 28 32

33 34 52

53

1

Mr. Bikramjit AhluwaliaChairman

Dr. Rohini AhluwaliaExecutive Vice Chairperson, CEO

DIRECTORSMs. Sudarshan Walia Mr. Arun Kumar GuptaProf. G.P. TalwarDr. S.S. AroraDr. S.C.L. GuptaMr. S.K. Sachdeva

COMPANY SECRETARY REGISTERED OFFICE Mr. Ranjan Kumar Sahu 4, Community Centre, Saket, New Delhi-110017

Telefax: +91-11-26852036

BANKERS MANUFACTURING FACILITIES Punjab & Sind Bank SP-917 & 918, Phase III, Bhiwadi - 301019Syndicate Bank Dist. Alwar, RajasthanState Bank of Bikaner & Jaipur Tel: 01493 - 225304-07, Fax: 01493 - 221045

AUDITORS WEBSITEM/s Arun K. Gupta & Associates www.ahlconindia.comChartered Accountants, email: [email protected], East of KailashNew Delhi - 110065

For Ahlcon Parenterals, 2009-10 was a year of strong

growth enabled through optimal efficiencies, backed by

strategic moves across products, markets and capacities.

Overall, the Pharma market is expected to grow at a CAGR

of 15% through 2015, with follow-on biologics making big

inroads in the small molecules market.

A year when the focused efforts of the Company's directors With increasing approvals of biologics and

and employees, in internal initiatives on productivity Neutraceuticals applications, this market is expected to

enhancement and cost optimization, enabled excellent growth grow further by ~31% - 35% by 2012.

in numbers and value on the back of optimal efficiencies.Indian companies possess the necessary infrastructure

When constant innovative approach in technical excellence, and facilities to produce world-class Parenterals /

boosted by a spirit of nurturance of a congenial work ophthalmic products.

environment, was utilized to the fullest, resulting in higher All the major Parenterals-producing Indian companies are

competencies across business operations.already exporting Parenterals to the US, European and

W h e n a f a r- s i g h t e d s t r a t e g y t o d o m e s t i c a l l y other emerging markets.

produce/manufacture products formulations and market the With increasing approval of innovator biologics and

same in the international market by exporting these products possible entry of bio-generics, Parenterals / ophthalmic

helped the Company further boost its margins.requirement will increase, providing an opportunity for

Indian Parenterals / ophthalmic producers to work in It was a strategy that was primed to make the most of the conjunction with the global pharmas.growing opportunity in the highly promising Parenterals

In the Neutraceutical markets too, wherein Parenterals market, with its total size of $3 billion.play a big role, Indian Parenterals companies, with their

And that was geared to further encash the lucrative market world-class quality and established brands, are expected scenario underlined by the following key facts and figures: to do well.

Geared to deliver optimal efficiencies Technology', imported from Switzerland and the US and fully

geared to deliver optimal efficiencies.Ahlcon Parentrals (India) Ltd. is a well established

Parenterals / ophthalmic company engaged in the business The Company's business structure operates around the

of manufacturing and exporting the entire range of following:

Parenterals / ophthalmic products, in addition to the Contract manufacturing - The Company is manufacturing on

domestic markets.contract basis for various brand leaders in India, such as

Based in New Delhi (India), the Company supplies its Ranbaxy, Cipla, Cadila, etc.

products to almost all top Indian pharma companies.Domestic formulations - The Company markets its in-house

An experienced and qualified team with diverse functional products through stockists appointed in nominated regions, with

expertise - spanning production, quality assurance, sales being done on a propaganda basis.

marketing, distribution, etc – powers the growth of the Exports to International markets - The Company makes direct and

Company.indirect exports to CIS countries (Russia, Ukraine, Kazakhstan),

The Company which employs a highly sophisticated the African sub-continent, GCC countries, Eastern European

production process, `The Aseptic Form-Fill-Seal countries and South East Asia.

Driving strong growth

Our extensive product portfolio

The Company's Parenterals / product portfolio comprises: Dextrose, Saline, Electrolytes, Amino Acids, Fat

Emulsion, Blood Substitutes, Small Volume Injectables and Eye Drops.

Ophthalmic

LVPs

Nutritional Fluids

Anti Microbial Therapies

Replacement Solutions

Parenterals

SVPs

Injectables & Pharmaceutical Diluents for Injections

Ophthalmic (Eye and Ear Care Products)

Nebulizers (Nose Care Products)

32

Ahlcon's Diary

The Company's efficiencies are augmented by its highly The Company's success odyssey is led by a core of robust and

sophisticated production process, carried out at the Bhiwadi diverse strengths, encompassing: skilled manpower, quality

plant which is spread over 36000 sq.m. of land, around 70 kms products, state-of-the-art manufacturing facilities, excellent

from Delhi. systems and high-end operational capacities.

The Company started production in 1994 with only one Our international business reaches the following approved

FFS machine for Large Volume Parenterals with installed sites by International buyers:

capacity of 14 million bottles per annum in 100 ml / 250ml Denmark /300ml / 500 ml. Today, the manufacturing capacity involves Belgiumfive machines in operation, of which four are from TanzaniaRommelag, Germany and one from Weiler Engineering Ltd, Slovak Republic US, with total installed capacity of 32 million bottles in LVP Russia (Large Volume Parenterals) and 144 million vials in SVP Ukraine(Small Volume Parenterals). A latest generation super Kenyaheated water spray sterilizer manufactured by SBM NamibiaAustria is employed for terminal sterilization, while the facility Sudanhas a water system well designed to meet the international Sri Lankastandards.Turkmenistan

The Company has been awarded WHO GMP for Belarusmanufacturing practices and has international quality Ugandaacceptance certification of ISO 9001:2008. The Company's Nigeria manufacturing capacity is approved by its international clients Ivory coastas well. Yemen

Armed with the motto 'Life flows from technological continually striving to uplift its production processes to global

excellence', Ahlcon is an ISO 9001:2008 company and the standards. Endorsing the success of this endeavour is

proud recipient of international quality acceptance, the WHO GMP (Good Manufacturing Practice) certification,

endorsing its international quality standards and the high which the Company was awarded within a short time of its

level of its efficiencies and growth. incept ion. The GMP Standards upgradat ion was

implemented and achieved under the supervision of Pharma

With quality assurance a key growth driver, the Company is Plan, Germany

Our growing world-class capacities Our stringent quality commitment

4

Strategic expansion is the key to the Company's growth millions in addition to SVP capacity of 144 millions.

plans for the future. With its eyes set on spectacular growth The Company is fully geared to take on the global pharma market

in both revenues and profit from its expanded capacities, challenges, underlined by price discrimination, cut throat

the Company plans to complete/commission its new competition, entry of new entities in the market, government price

additional LVP line of production during the second quarter regulatory mechanism, as well as manufacturing units at SEZ.

of financial year 2010-11, thereby further enhancing Armed with its core of manufacturing and distribution strengths,

efficiencies and boosting growth. the Company is all set to take continued advantage of the

The Company is currently in its 5th expansion plan for increased demand of Indian pharmaceutical products in the

setting up a new LVP machine, imported from Switzerland, international market. For this purpose, the Company has

to further augment its LVP capacity from 32 millions to 45 undertaken registration and arrangements with several

Driving strategic expansion

5

international agencies for increasing its base of export with several international agencies for increasing the base of its

export markets. Further, plans are under way to increase the markets. Further plans are under way to increase the direct

direct and indirect exports to many countries.and indirect exports to many countries.

Further, the Company has launched its own brand in the local Expansion of its product pipeline to new markets is another

market (ethical market) by its own marketing network to sustain key component of the expansion strategy of the Company,

its growth in the ensuing and coming years. which is in the process of registration of its product dossiers

in both the regulated as well as unregulated markets. The It has also entered into a number of marketing pacts with leading

Company has obtained registration certificates in some pharmaceutical companies in India and abroad for supply of its

countries, while the process is under way in several others. products.

Taking advantage of the increase demand of Indian The Company is in the process of upgradation of the

pharmaceutical products in the international market, the organization, existing formulations, manufacturing process,

Company has undertaken registration and arrangements packing materials and development of new formulations.

76

It gives me immense satisfaction and is pleased to welcome At "AHLCON", we stress “Value for Money”. Qualitative product is

you all to 18th Annual General Meeting of the company. the measure of achievement here. Production facilities have been

upgraded to conform to latest GMP standards as per international This year under report has been an inflection pointing

guidelines and the specified requirement of the giant pharma Ahlcon Parenteral,s journey to success, and thus with a

customers. To achieve the desired plans to export a substantial deep sense of satisfaction, I share with you, the results of

portion of its production meeting the standards of GMP, WHO your company for the Financial Year 2009-10, and the

Geneva standards, your company has already started the Company's strategy going forward.

process of product registration in more than 15 countries.Financial Excellence: The year 2009-10, for your company

Strategic investments, robust business plans, sound was of sterling performance across several financial and

management practices and contribution by our dedicated operating indicators. The Turnover for this fiscal stood at an

employees have collectively resulted in the company performing impressive Rs.5063 lacs, representing a 32 percent

exceedingly well.increase from the last years Rs.3830 lacs. This was reflective

of the company's exemplary management capabilities in Industry review: India has emerged as an attractive destination for

pharmaceutical arena. Consequently the Net Profit (PAT) outsourcing as it provides low cost manufacturing at a world-

was of up by 216 percent to Rs. 715 lacs, as against Rs. 226 class quality of products. The scientific, technical and

lacs in previous fiscal. manufacturing skills available in India match the requirements of

global drug manufacturers those are increasingly seeking to I am confident that this trend shall be maintained for the

offshore research and manufacturing activities previously future years also. We have been putting untiring efforts to

performed in-house. continuously upgrade the technical and business skills, by

employing a task force of motivated and committed With the recognition of India as a high quality and low cost

professionals. manufacturing base, we are well placed to grab maximum

benefits as we have been able to create a niche market for trainings. We also encourage employees to acquire additional

contract manufacturing by delivering superior quality skills through participation in seminars.

products and thereby, more and more valued customers, Overall, the year re-affirms our commitment of creating value for

both from the national and international market are our shareholders by focusing on profitable growth. With the spirit,

approaching us for getting their products manufactured in commitment and dedication of Ahlcon Parenterals Team, we are

our plant.confident of realizing our growth potential. Our core values shall

Expansion: The production capacity of the company is propel us towards our vision of becoming one of the largest and

being scaled up as it plans to stretch its operations in both most admired pharmaceutical ophthalmic and I V fluids

the domestic as well as international markets. The company nationally / internationally, which will help your

erectioning of the 5th phase of the ongoing expansion has company to deliver sustainable and profitable growth for many

already begun and the commercial production from the years to come.

same shall start very shortly. Currently, the company has an The journey of excellence is undoubtedly a tribute to our many

installed capacity of 32 million units for LVP and 144 million stakeholders - our consumers, customers partners, associates

units for SVP. With the installation/ commissioning of the and our dedicated employees of today and yesterday who have

new machine, the installed capacity of LVP will be up by steadfastly stood, as we persevered to create a national asset.

further 13 million units and the total installed capacity of LVP Acknowledgement: With gratitude to our investors, employees, will be 45 million of units & SVP 144 million units.customers and all stakeholders, we look forward to your

Human Resources Management: As we explore new continued supported in our endeavour.

markets and new products, new skills are set to be Thanking you,developed to meet the new challenges. Your company has

added many technical and commercial staffs equipped with Yours sincerely specialized knowledge in their respective fields. To sustain

Bikramjit Ahluwaliathe increase in employees' productivity, we organize

continuous competency development programmes and Chairman

Dear Shareholders,

Strategic expansion is the key to the company's growth plans for the future.

With its eyes set on spectacular growth in both revenues and profit from its

expanded capacities, the company plans to complete / commission its new

additional LVP line of production during the second quarter of F.Y. 2010-

11, thereby further enhancing efficiencies and boost growth

98

Chairman's Message

1010 Ahlcon Parenterals (India) Ltd

NOTICE

Notice is hereby given that the 18th Annual General Meeting ofAhlcon Parenterals (India) Limited will be held on Friday, the 17thday of September 2010 at 03.00 P.M. at the Ahlcon Public School,Mayur Vihar, Phase-I, New Delhi-110091 to transact the followingbusiness:

Ordinary Business:

1. To receive, consider and adopt the Audited Balance Sheet ofthe Company as at 31st March 2010, Profit & Loss Accountand Cash Flow Statement for the year ended on that datetogether with Reports of the Board of Directors and theAuditors thereon.

2. To declare dividend on Equity Shares of the company.

3. To appoint a Director in place of Dr.S S Arora, who retires byrotation and being eligible, offers himself for reappointment.

4. To appoint a Director in place of Dr S C L Gupta, who retiresby rotation and being eligible, offers himself forreappointment.

5. To appoint a Director in place of Mr.Bikramjit Ahluwalia, whoretires by rotation and being eligible, offers himself forreappointment.

6. To appoint Auditors to hold office from the conclusion of thisAnnual General Meeting until the conclusion of the nextAnnual General Meeting of the Company and authorise theBoard of Directors/ Audit Committee to fix their remuneration.

M/s. Arun K Gupta & Associates, Chartered Accountants, arethe retiring Auditors and, being eligible, offer themselves forreappointment.

Special Business

7. To consider and if thought fit, to pass, with or withoutmodification(s), the following resolution as SpecialResolution:

Increase in Remuneration of Whole Time Director,Dr. Rohini Ahluwalia

“RESOLVED that pursuant to the provisions of section 198,269 read with Schedule XIII, Section 309, 310 and otherapplicable provisions of the Companies Act, 1956,or anymodification or reenactment there of , and subject to theapproval of the relevant authority required if any, approval ofthe company be and is hereby accorded to increaseremuneration of the Executive Vice Chairperson, Whole TimeDirector, CEO, Dr Rohini Ahluwalia, for a period of 5 yearswith effect from 1st August, 2010 as per the following: -

a) Basic Salary @ 2,00000/-(Rupees Two Lac only) per monthwith an annual increment of maximum of 10 per cent in themonthly salary.

b) Free supply of gas, electricity, water, furniture and furnishing at

the residence, subject to the ceiling that the expenditureincurred by the company on the same value as per the IncomeTax Rules1962, shall not exceed 10 % of the basic salary.

c) Leave Travel Assistance for self and dependent family once in ayear to and fromany place in world on actual basis subject to theprovisions of Income Tax Act and rules made there under.

d) Reimbursement of Medical expenses for self and family onactual basis which is otherwise not covered by the mediclaiminsurance policy.

e) Premium for Mediclaim Policy for self, spouse and dependentfamily subject to a ceiling of policy amount of Rs.20,00,000/-(Rupees Twenty Lacs only).

f) Fees of maximum of two clubs, subject to the condition thatLife Membership Fees shall not be allowed.

g) Personal Accident Insurance, the premium of which shall notexceed 2000/-( Rupees Two Thousand only) per annum.

h) Free telephone facility at residence, subject to the conditionthat personal long distance calls shall be recovered from theWhole Time Director.

i) Provision of car for use for Company’s business, subject tothe condition that use of car for private purposes shall berecovered from the Whole Time Director or reimbursement ofexpenses incurred on conveyance in case of use of personalcar for Company’s business.

j) Gratuity not exceeding one half month’s salary for eachcompleted year of service.

k) Contribution to Provident Fund and pension Fund subject tospecified ceilings in applicable law.”

“RESOLVED further that pursuant to the provisions of sections 198and 309,, Section I of Part II of Schedule XIII, of the CompaniesAct, 1956, a company having profits in a financial year may payany remuneration, by way of salary, dearness allowance,perquisites, commission and other allowances, which shall notexceed five per cent of its net profits for one such managerialperson, and if there is more than one such managerial person, tenper cent for all of them together.

“RESOLVED further that the Company shall reimburse the WholeTime Director all expenses incurred on entertainment, travelingand/or any other expenses incurred solely for the purpose ofbusiness of the Company and that the same shall not beconsidered a part of remuneration.”

By order of the BoardFor AHLCON PARENTERALS (INDIA) LIMITED

Place : New Delhi Ranjan Kumar SahuDated: 14.08.2010 Company Secretary

11Ahlcon Parenterals (India) Ltd

18th Annual Report

NOTES:

1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THEMEETING IS ENTITLED TO APPOINT A PROXY TO ATTENDAND VOTE INSTEAD OF HIMSELF/ HERSELF AND SUCHPROXY NEED NOT BE A MEMBER OF THE COMPANY.PROXIES IN ORDER TO BE EFFECTIVE, MUST BERECEIVED BY THE COMPANY AT ITS REGISTERED OFFICENOT LATER THAN, 48 HOURS BEFORE THECOMMENCEMENT OF THE MEETING.

2. Proxies shall not have any voting rights except on a poll.

3. Only bonafide members of the company whose namesappear on the Register of Members/ Proxy holders, inpossession of valid attendance slips duly filled and signedwill be permitted to attend the meeting. The companyreserves its right to take all steps as may be deemednecessary to restrict non members (excluding valid proxyholder) from attending the meeting.

4. The Register of Members and Share Transfer Books of thecompany shall remain closed from 10th September 2010 to17th September 2010 (both days inclusive) for the purposeof Annual General Meeting and payment of dividend.

5. The dividend for the year ended 31st March 2010 asrecommended by the Board, if declared at the meeting, willbe paid to those members whose names appears in theCompany’s Register of Members as on the opening hours ofSeptember 10th , 2010. In respect of shares held in electronicform, the dividend will be paid to the beneficial owners on theabove said date as per the details provided by the NSDL andCDSL.

6. Dividend Payment:

As per directive from Securities and Exchange Board of India(SEBI), the company has been using the Electronic ClearingService (ECS) of the Reserve bank of India (RBI),atdesignated locations, for payment of dividend to shareholdersholding shares in dematerialised form, the service wasextended by the company also to shareholders holdingshares in physical form, who chose to avail of the same. Inthis system, the Investor’s Bank account is directly creditedwith the dividend amount.

As per RBI’s notification, with effect from 1st October, 2009,the remittance of money through ECS has been replaced byNational Electronic Clearing Service (NECS), NECS operateson the new and unique bank account number allotted bybank post implementation of the Core Banking Solutions(CBS). Pursuant to implementation of CBS, your bankaccount may have undergone a change, which is required tobe communicated by you to your Depository Participant ( incase of shareholders holding shares in dematerialised form)or to the Company’s Share Transfer Agent ( in case of

shareholders holding shares in physical form).

Shareholders holding shares in physical form who have notyet opted for the ECS Mandate Facilities, are urged to avail ofthe NECS Mandate Facility as this not only protects ashareholder against fraudulent interception of dividendwarrants but also eliminates dependence on the postalsystem, loss/ damage of dividend warrants in transit andcorrespondence relating to revalidation/ issue of duplicatedividend warrants.

Kindly ensure that the above instructions are / is under yoursignature (which should be as per specimen registered withthe Depository Participant / Company) and arecommunicated before commencement of the book closuredate, to facilitate receipt of dividend. Please note that if yournew bank account number is not informed as aforesaid,payment of your dividend to your old bank account numbermay either be rejected or returned.

7. Those members who have so far not encashed their dividendwarrants for the below mentioned financial years, may claimor approach the company for the payment thereof as thesame will be transferred to the Investor Education andProtection Fund of the Central Government, pursuant tosection 205C of the Companies Act, 1956 on the respectivedates mentioned there against. Intimation in this regards isbeing sent to the concerned shareholders periodically. Kindlynote that after such dates, members will lose their right toclaim such dividend.

Financial Year ended AGM date Due date

31.03.2005 30.09.05 29.09.2012

31.03.2006 30.09.06 29.09.2013

31.03.2007 29.09.07 28.09.2014

31.03.2008 30.09.08 29.09.2015

31.03.2009 30.09.09 29.09.2016

8. Members those who may not have received/ encashed thedividend warrants for the year 2004-05,2005-06,2006-07,2007-08 and 2008-09 may claim it/ apply for revalidation eitherto the RTA or the Secretarial Department of the company. Anyamount remaining pending as unclaimed dividend for the saidyear shall be due for transfer to the Investor Education andProtection Fund on completion of seven years from the dateof declaration thereof.

9. Trading in the shares of the Company is compulsory indematerialized form for all investors. There are number ofadvantages in keeping shares in dematerialized mode like nostamp duty, lesser risks of delays/ loss in transit/ theft/mutilation/ bad deliveries, no courier/ postal charges andimmediate transfer. Hence, we request all those shareholderswho have still not dematerialized their shares to get their


shares dematerialized at the earliest.

10. All documents referred in the notice are open for inspectionat the Registered Office of the company between 11.00 A.M.to 1.00 P.M. on any working day prior to the date of the AnnualGeneral Meeting.

11. Members / Proxies should bring the attendance slips dulyfilled in for attending the meeting. Members who hold sharesin dematerialised form are requested to bring their Client IDand DP ID numbers for easy identification of attendance atthe meeting.

12. It will be appreciated that queries, if any, on accounts andoperations of the company are sent to the corporate office ofthe company ten days in advance of the meeting so that theinformation may be made readily available.

13. Shareholders are requested to immediately intimate thechange in address and bank details, if any, to the Company’sRegistrar and Share Transfer Agent M/s MAS Services Ltd, T-34, 2nd Floor, Okhla Industrial Area,Phase - II, New Delhi - 110 020 for payment of dividend. Thosewho are holding their shares in dematerialized form shouldnotify to their Depository Participants, change / correction intheir address/ bank account particulars etc.

14. Shareholders are requested to bring their copy of AnnualReport to the meeting.

15. INFORMATION REQUIRED TO BE FURNISHED INPURSUANCE OF CLAUSE 49 OF THE LISTING AGREEMENTWITH STOCK EXCHANGES

The particulars of the Directors who are proposed to beappointed/ reappointed are as given below:

Dr. S. S. Arora

Dr. Arora, DOB: 16.01.1959, Age: 51 years, Qualification:MBBS, MD

Dr. Arora is an MBBS, MD and having the Fellowship ofAmerican Association for Respiratory Care, USA. He is havinga very large experience in the pharmaceutical field. Presently,he is a Senior Consultant, Batra Hospital, New Delhi.

Being a senior consultant for a large group of hospitals, hehas his expertise in establishing strategies for marketing ofpharmaceutical products. He possesses in-depth knowledgeon analysis of pharmaceutical market data.

Dr. Arora does not hold directorship in any other company.

No. of Equity Shares held: NIL

Dr. S. C. L. Gupta

Dr. Gupta, DOB: 21.07.1953, Age: 57 years, Qualification:MBBS, M.S, M.I.S.C.O, Standing Members of DelhiLegistative Assembly,

Experience: Dr. Gupta is an M.S, M.I.S.C.O. He has to hiscredit a very rich experience in the Medical Profession andhas been bestowed with many prestigious awards for hisoutstanding performance in his field. He is presently servingmany reputed hospitals as consultant surgeon andoncologist.

He was inducted to the Board of your company on 29thJanuary, 2003 and till then serving continuously.

Dr. Gupta, does not hold directorship in any other company.

He is not holding any shares and directorship in any othercompany.

Mr. Bikramjit Ahluwalia

Mr. Ahluwalia, DOB: 4.12.1939, Age: 70 Years, Qualification:Civil Engineer, Industrialist

Experience: Mr. Bikramjit Aluwalia, a, civil engineer byqualification and having more than four decades experiencein management of various business segment. He has himselfpromoted the Ahluwalia Contracts (India) Ltd in the year 1979,which has become a pioneer in the construction andengineering Industry. He is also founder Chairman of AhlconPublic School and Ahlcon International School in Delhi. Hehas been honoured with many prestigious awards for hiscontribution to the Society in General. He is serving yourBoard in the capacity of Chairman since its inception.

Nature of expertise in specific functional area: BusinessManagement.

Mr. Ahluwalia is not a Chairman / members in any committee.

Other Directorship: 1. Ahluwalia Contracts (India) Ltd, 2.Ahluwalia Builders and Development Groups Pvt.Ltd. 3.Capricorn Industrials Limited.

He has been bestowed with several prestigious Honours andAwards by many premier organizations at national andinternational level.

Mr. Ahluwalia was holding 2596312 Equity Shares of thecompany, as on 31st March, 2010.

Pursuant to Clause 49 of the Listing Agreement, there is nodirector appointment during the year 2010, so particulars ofdirectors not required:

16. Annexure to Notice: Explanatory Statement u/s 173(2) of theCompanies, Act, 1956.

ITEM NO. 7

Increase of the Remuneration of Dr. Rohini Ahluwalia,Executive Vice Chairperson, Whole Time Director, CEO:

Considering the present market trend, inflationary trend, increasein work and responsibilities and also the amount being paid toWhole Time Director occupying similar position in other


18th Annual Report

13

comparable companies in the Pharma Industry, the RemunerationCommittee at its meeting held on 12.08.2010 and the Board ofdirectors at their meeting held on 14.08.2010 have decided to fixthe limit of Basic Salary as Rs.200000/- per month to be paid tothe Executive Vice Chairperson, Whole Time Director, CEO witheffect from 1st August, 2010 along with allowances as mentionedin the resolution, for a period of 5 years with the limit specified inschedule XIII, Part II, Section I of the Companies Act, 1956.

In the earlier years Dr. Rohini was having basic salary ofRs.140000/- P.M. with an annual increment of Maximum of 10% inthe monthly Salary along with other benefits and perquisites asapproved by the shareholders. At present the basic salary isRs.140000/- P.M.

Taking into account the present, “Effective Capital of Rs.43.22crores (approx.) of the company as per schedule XIII, Part II,Section I, Subject to the provisions of sections 198 and 309, acompany having profits in a financial year may pay anyremuneration, by way of salary, dearness allowance, perquisites,commission and other allowances, which shall not exceed five percent of its net profits for one such managerial person, and if thereis more than one such managerial person, ten per cent for all ofthem together.

As per the profit of the company for the year ended 31.03.2010,under review, the proposed remuneration shall be with in the limitprovided under the above schedule. The Company can continueto pay the same remuneration in future years if the same isapproved by the shareholders by way of Special resolution with inthe limit provided under section I of Part II of schedule XIII of theCompanies Act, 1956. Further the general information is givenunder, as per the conditions specified under section I of Part II ofsection XIII of the Companies Act, 1956.

As per clause 49 of the Listing agreement to CorporateGovernance, the Remuneration Committee on dated 12.08.2010of the Company has approved the increase in remuneration statedin the resolution. Therefore, the Board recommends approvingitem No.7 by way of Special Resolutions.

None of the directors of the company are interested in the

resolutions except Dr. Rohini Ahluwalia being the beneficiaries andMr. Bikramjit Ahluwalia and Ms. Sudarshan Walia, being therelatives of Dr. Rohini Ahluwalia.

The tenure of the Whole Time Director, Dr. Rohini Ahluwalia is upto31.03.2014. Further, under the able guidance and managementof Dr. Rohini Ahluwalia, the company has achieved its manifoldobjectives. Keeping the long standing services and best interest ofthe company, the Board has increase the remuneration of theWhole Time Director for another period of 5 years in its meetingheld on 14.08.2010.

General information about Dr. Rohini Ahluwalia, WTD, CEO:

Dr. Rohini Ahluwalia is an MBBS and having a vast experience inthe field of Pharmacutical Industries. She is an eminent successfullady industrialist who is looking after the company as a WholeTime Director for past many years.

She is the Chairperson of Ahlcon International School. She is alsoholding directorship in Tidal Securities Pvt Ltd and Capricornindustrials Limited.

Dr. Rohini was holding 4,69,710 Equity Shares of the company, ason 31st. March, 2010.

With a deep appreciation of the service of Dr. Rohini Ahluwalia forthe overall development of the company, the Board passed theresolution for increase of Remuneration for further period of 5years with effect from 1st August, 2010 subject to approval ofshareholder at the ensuing Annual General Meeting..

None of the directors of the company are interested in theresolutions except Dr. Rohini Ahluwalia being the beneficiaries andMr. Bikramjit Ahluwalia and Ms. Sudarshan Walia, being therelatives of Dr. Rohini Ahluwalia.

By order of the BoardFor AHLCON PARENTERALS (INDIA) LIMITED

Place : New Delhi Ranjan Kumar SahuDated : 14.08.2010 Company Secretary


DIRECTORS ' REPORT

To the Members,

Your Directors have their pleasure in presenting the 18thAnnual Report on the business and operations of theCompany for the year ended 31st March 2010.

FINANCIAL RESULTS:

(Rs. in Lacs)

For the year ended 31.03.2010 31.03.2009(Current Year) (Previous Year)

Sales (including excise) 5527.78 4437.05and other IncomeGross operating Profit 1516.95 732.98Financial Charges 167.99 188.67Cash Profit 1348.95 544.30Deprecation 219.54 222.91Misc. expenditure written off 0.43 1.35Provision for doubtful debts/obsolete Stock 15.93 32.02Provision for doubtfuldebts written back 5.78 26.07Prior period Adjustments 10.70 (29.19)Profit before Tax 1108.12 343.29Provision for Deferred Tax 6.13 7.07Provision for Current &Fringe Benefit Tax 382.10 109.77Income Tax Paid for earlier years 3.79 0.30Profit after Tax 715.87 226.16Balance brought forwardfrom previous year 1522.27 1478.79Profit available for appropriation 2238.14 1704.95Proposed Dividend onPreference Shares 5.40 5.40Tax on Dividend onPreference Shares 0.92 0.92Proposed Dividend onEquity Shares 108.00 108.00Tax on Dividend on Equity Shares 18.35 18.35Profits transferred toGeneral Reserve 60.00 50.00Profit carried forward 2045.46 1522.87

OPERATIONAL PERFORMANCE

Your Directors have the reasons to be satisfied about thefinancial & operational performance of the company as it hascontinued to surpass all its previous records and has achieved

a sales turnover of Rs.5527.78 Lacs (including excise), ascompared to the previous year’s figure of Rs.4437.05 lacs, agrowth of 24.58 %. Due to the constant efforts put by thedirectors and employees in internal initiatives on productivityenhancement, cost optimization and a congenial workenvironment, the company has achieved Net Profit after tax ofRs.715.87 Lacs as compared to the previous year’s figure of226.16lacs, a growth of 216.53 %.

Due to the constant innovative approach in technicalexcellence, the installed capacities on both LVP (Large VolumeParenterals) and SVP (Small Volume Parenterals) lines havebeen utilized to its fullest extent.

DIVIDEND

Your board of directors have recommended a final dividend of15 % (Rs.1.50 per Equity Share face value Rs.10 per share)subject to your approval at the ensuing Annual GeneralMeeting scheduled to be held on 17th September 2010 which,if approved at the ensuing AGM will be paid to those memberswhose names are on the Register of Members of the companyand the beneficiaries’ list of the Depositories as on the openinghours of 10.09.2010. The company had made payment ofDividend Rs.132.67 lacs (including dividend Tax) to theshareholders for the year ended on 31.03.2009.

The dividend payout for the year under review has beenformulated keeping in view the company’s need for capital, itsgrowth plans and the intent to finance such plans throughinternal accruals to the maximum. Your directors believe thatthis would increase shareholder value and eventually lead toa higher return threshold.

TRANSFER TO RESERVES

Out of the profit available for appropriation, your directorspropose to transfer Rs.60 lacs to the general reserve of thecompany which they consider for building a strong reserveposition for future utilization.

EARNING PER SHARE

EPS (Earning per Share) is Rs.9.85, as compared to theprevious year’s figure of Rs.3.05

CORPORATE REVIEW

The pharmaceutical industry in India is among the most highlyorganized sectors. This industry plays an important role in


18th Annual Report

15

promoting and sustaining development in the field of globalmedicine. Due to the presence of low cost manufacturingfacilities, educated and skilled manpower and cheap labourforce among others, the industry is set to scale new heights inthe fields of production, development, manufacturing andresearch.

Your Company is engaged in the business of manufacturingLife-Saving Intravenous Fluids, Ophthalmic Eye, and EarDrops, by employing a highly sophisticated productionprocess with the Aseptic Form-Fill-Seal Technology.

Ahlcon Parenterals (India) Limited manufactures and sellsantimicrobial intravenous fluids, eye/ear drops, and otherrelated products, primarily in India. Ahlcon Parenterals alsoexports its products to the CIS countries, including Russia,Ukraine, and Kazakhstan; and the African, GCC, and easternEuropean countries, as well as to south east Asia.

A leading player in the intravenous fluids segment is planningaggressively to increase its reach across emerging markets. Itis also increasing its focus on other businesses that hasoutperformed the Index over the past one year and still lookspromising for long term investors.

Life-Saving Intravenous Fluids is injected into a patient’s veineither as a medium for other medicines or to relievedehydration, and is the fastest way to deliver drugs throughoutthe body. These are of two types, sugary (dextrose) and saline.Saline can be isotonic which means it mimics the bodiesnatural blood salt concentration and contains 0.9% saltsolution, and is called normal saline. Hypotonic solutions thatcontain half the bodies normal blood salt concentration of.045%, called half-normal saline.

Four-fifths of all patients admitted to a hospital as well as asimilar number of patients in the emergency and intensive careunits need intravenous fluids. Hospitals require intravenousfluids regularly, making it an essential part of treatmentaccording to medical practitioners.

Growth Drivers: AHLCON has undertaken a strategy todomestically produce/ manufacture the products formulationsand market the same in the International market by exportingits products. It had launched its own brand in the local market(ethical market) by its own marketing network to sustain itsgrowth in the ensuing and coming years. The company is inthe process of 5th expansion plan for setting of new LVPmachine, of 13 millions capacity imported from Switzerland forincreasing its LVP capacity from 32 millions to 45 millions in

addition to SVP capacity of 144 millions.

Further, it has entered in to a number of marketing pact withleading pharmaceutical companies in India and abroad forsupply its products.. At present Company is exporting itsproducts to CIS Countries (Russia, Ukraine, Kazakhstan),African Countries, GCC Countries, Eastern EuropeanCountries and South East Asia, etc.

Contract manufacturing is another new opportunity for theIndian pharmaceutical industry. It provides low costmanufacturing at a world-class quality of products. Thescientific, technical and manufacturing skills available in Indiamatch the requirements of global drug manufacturers thoseare increasingly seeking to offshore research andmanufacturing activities previously performed in-house. For along-term sustainable advantage of this increasing trend inCRAMS, Indian companies are increasingly resorting totechnological up gradation of their manufacturing and R & Dfacilities to grab the opportunities emerged by the spurt inglobal demand.

PRODUCT DEVELOPMENT / EXPANSION

The Company is in the process of update the organization,existing formulations, manufacturing process, packingmaterials and develop new formulations for AHLCON. Theproduction capacity/ utilization of the company are beingscaled up as it plans to stretch its operations in both thedomestic as well as in international markets.

EXPORTS

Your directors are putting constant efforts for increasing theexport sales component on the total turnover to mitigate therisk posed by various domestic markets and factors, which areresulting into price discrimination, cut throat competition, entryof new entities in the market, government price regulatorymechanism, as well as manufacturing units at SEZ. Takingadvantage of the increased demand of Indian pharmaceuticalproducts, in the international market, the company has carriedon registration and arrangement with several internationalagencies for increasing the base of export markets. Furtherplans are underway to increase the direct exports to manycountries. As a result of this, during the year under review, thedirect export sales were Rs.467 lacs (FOB value ) ascompared to the previous year’s figure of Rs. 267 lacs ( FOBvalue ) a growth of 75% as compared to the previous year.

As informed in our previous report, your company is in theprocess of registration of its product dossiers, in both theregulated as well as unregulated markets and the registration


formalities with number of countries are obtained as well as inprogress. We have obtained orders from some parties and assome countries registration process is in under the pipe lineand hence soon after these registration certificates areobtained, company shall be able to grab the export earningsby exporting to those countries.

BANKERS

We are banking with the Punjab & Sind Bank & SyndicateBank, which has been providing financial assistance to ourcompany for various purposes. We express our heartycommends for their response in every angle.

DIRECTORS

During the year under review, Mr. Bikramjit Ahluwalia,Chairman and Dr. Rohini Ahluwalia, Whole Time Director of thecompany controlled the affairs of the company to maximizewealth for the shareholders as well as the company.

The Board approved the increase of Remuneration of DrRohini Ahluwalia for a period of 5 years w.e.f 01.08.2010subject to approval of shareholders in the ensuing AGM.Having a vast experience in the Pharma Industry, and hertimely directions ultimately had provided long term benefits tothe Company. Her constant efforts and seasoned decisionspaved the way to success in all paths.

In accordance with the provisions of the Companies Act, 1956and Articles of Association of the company,Dr S.S. Arora, Dr SC L Gupta and Mr Bikramjit Ahluwalia, Directors of thecompany are liable to retire by rotation at the ensuing AnnualGeneral Meeting and being eligible, offer themselves forreappointment.

Necessary resolutions seeking the approval of theshareholders for the aforesaid increase of remuneration ofdirector, form part of the notice, convening the Annual GeneralMeeting. The particulars of directors seeking increase ofremuneration is provided under the “Report on CorporateGovernance” forming part of this Annual Report.

Directors’ Responsibility Statement: Pursuant to therequirement under section 217 (2AA) of the Companies Act,1956, with respect to Directors’ Responsibility Statement, it ishereby confirmed:

i) That the applicable accounting standards have beenfollowed alongwith proper explanation relating to materialdepartures in the preparation of annual accounts;

ii) That the Directors have selected such accounting policiesand applied them consistently and made judgments andestimates that were reasonable and prudent so as to givea true and fair view of the state of affairs of the Companyat the end of the financial year and of the profit or loss ofthe Company for the year under review;

iii) That the Directors have taken proper and sufficient carefor the maintenance of adequate accounting records inaccordance with the provisions of the Companies Act,1956 for safeguarding the assets of the Company and forpreventing and detecting fraud and other irregularities;

iv) That the Directors have prepared the accounts for thefinancial year ended 31st March, 2010 on a ‘goingconcern’ basis.

CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement with the StockExchanges, a separate section titled “Report on CorporateGovernance” has been annexed to this Annual Report.

AUDITOR’S REPORT

The remarks referred to in the Auditors Report are self-explanatory except the following points on which we commentas follows:

On the observation of disputed income tax / other demandmentioned at point no. 9 (ii) of the Annexure to their report, thecompany has already preferred appeals before the appellateauthorities against the said demand of the Income Tax andother departments. Company has strong grounds to believethat the appellate authorities shall pass orders in favour of thecompany.

Auditors: M/s Arun. K. Gupta & Associates, CharteredAccountants, Statutory Auditors of the company, hold officeuntil the conclusion of the ensuing Annual General Meetingand are eligible for reappointment. We recommend for theirreappointment.

Conservation of Energy, Technology absorption, ForeignExchange Earnings / Outgo:

The information pursuant to section 217(1)(e) of theCompanies Act, 1956 read with Companies (Disclosure ofparticulars in the Report of Board of Directors) Rules, 1988 isfurnished in the Annexure forming part of this report.

Particulars of employees: During the year under review, noemployee was in receipt of remuneration exceeding the


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17

specified limits. Hence, no disclosure under section 217(2-A)

of the Companies Act, 1956, is required to be made.

INDUSTRIAL RELATIONS

The Company continued to maintain very healthy, cordial and

harmonious industrial relations at all levels and your Directors

wish to place on record their appreciation for the contributions

made by the employees at all levels and take this opportunity

to thank all employees for their hard work, dedication and

commitment.

ACKNOWLEDGEMENTS

Your Directors take this opportunity to offer their sincere thanks

to various departments of the Central and State Governments,Banks and Investors for their unstinted support, assistance andvaluable guidance. Last but not the least, the directors wish toplace on record their deep sense of appreciation for thedevoted service of the Executives, Staff and workers of thecompany at all levels.

For and on behalf of the Board of Directors

Place: New Delhi Bikramjit AhluwaliaDate: 14.08.2010 Chairman

ANNEXURE TO THE DIRECTORS' REPORT

I Conservation of Energy

Steps towards energy conservation are beingcontinuously undertaken to reduce wastage and improveefficiency resulting in reduced energy cost. Energy auditis regularly conducted and the company implements newand improved powers saving techniques to optimize theenergy consumption and reduce cost on such account.

(A) 1. Electricity, Power and Fuel consumption

Current PreviousYear Year

a) Purchased:

Units 45,890,80 4,825,760Total amount (Rs.) 21,510,058 22,190,871Average Rate per Unit 4.69 4.60

b) Own Generation:Units Generated 1,048,782 420,060Units generated perliter of Diesel oil 3.24 3.25Average Cost perUnit (Rs.) 9.58 10.18

2. Fuel (Furnace Oil/LDO):Units (Ltrs.) 961540 642724Total amount (Rs.) 24,214,345 17,069,712Average Rate/Unit (Rs.) 25.18 26.55

(B) Average Consumption (value) per unit of production:Electricity 0.311 0.305Fuel (Furnace Oil/LDO) 0.239 0.197

II Technology Absorption, Adoption and Innovation:

The company manufactures I V Fluids and Ophthalmicproducts using the FFS (Form-Fill-Seal) latest importedtechnology which is considered as the best techniqueworld over.

III Foreign Exchange Earnings and Outgo:(Rs. In Lacs)

Current PreviousYear Year

Foreign Exchange Earnings 466.61 267.49

Foreign Exchange Outgo:a) Foreign Travel - -b) Imports - Machinery spares 10.01 16.27c) Capital Goods 29.78 -d) Imports - Raw Materials 564.57 418.51e) Bank charges 1.94 1.12f) Registration Charges 1.34 4.53g) Professional Charges - 6.13h) Business promotion 2.38 -

610.02 446.56

For and on behalf of the Board of Directors

Place: New Delhi Bikramjit AhluwaliaDate: 14.08.2010 Chairman


MANAGEMENT DISCUSSION AND ANALYSIS REPORT

To the Shareholders,

This report aims to be helpful to the Shareholders of thepharmaceutical and healthcare market and provide them withan in-depth analysis of the business prospects.

CAVEAT

This section of the 18th Annual Report has been included inadherence to the spirit enunciated in the Code of CorporateGovernance approved by the Securities and Exchange Boardof India. Shareholders are cautioned that certain data andinformation external to the Company is included in this section.Though these data and information are based on sourcesbelieved to be reliable, no representation is made on theiraccuracy or comprehensiveness. Further, though utmost carehas been taken to ensure that the opinions expressed by themanagement herein contain their perceptions on most of theimportant trends having a material impact on the Company'soperations, no representation is made that the followingpresents an exhaustive coverage on and of all issues relatedto the same. The opinions expressed by the management maycontain certain forward-looking statements in the currentscenario, which is extremely dynamic and increasingly fraughtwith risks and uncertainties. Actual results, performances,achievements or sequence of events may be materiallydifferent from the views expressed herein. Shareholders arehence cautioned not to place undue reliance on thesestatements, and are advised to conduct their own investigationand analysis of the information contained or referred to in thissection before taking any action with regard to their ownspecific objectives. Further, the discussion following hereinreflects the perceptions on major issues as on date and theopinions expressed here are subject to change without notice.The Company undertakes no obligation to publicly update orrevise any of the opinions or forward-looking statementsexpressed in this section, consequent to new information,future events, or otherwise.

ECONOMIC SCENARIO

The slow-down which impacted the Indian economy, startedshowing some signs of recovery starting from last quarter of2009, especially on account of the higher industrial output.Despite the ineffective and deficient monsoon leading to thedecrease in the agricultural output, the Indian economy hasbeen decidedly upbeat with a higher-than-expected GrossDomestic Product growth rate of over 7%. It is heartening tonote that barring a few industries, the global meltdown hadlittle bearing on most of the business sectors in India. While

the recession did rattle the Chemicals industry in the last year,the Pharmaceuticals industry’s growth momentum did notshow signs of impairment. In the prevailing economicscenario, the Company performed reasonably well as can beseen from the operational performance.

OVERVIEW

Ahlcon Parenterals (India) Limited is one of the leadingcompany in the Indian Pharmaceutical market. TheCompany’s revenues are mainly from Contract Manufacturingand sale of branded-generic and unbranded-genericpharmaceutical products. A further break down ofpharmaceutical sales can be done as, Domestic formulations(comprising branded pharmaceuticals formulations sold in thedomestic market), Contract manufacturing (comprisingsourcing, manufacturing and supplying pharmaceuticalformulations to giant pharma company under their brandname) and direct export to International market comprisingexports of branded and generic pharmaceutical formulations.

The operating costs primarily comprise raw and packingmaterials, purchase of finished goods, staff cost (selling andmarketing expenses, manufacturing Research & Developmentexpenses and general overheads.

OPERATIONAL PERFORMANCE

AHLCON’s growth continued in 2009-10 in terms of value aswell as volumes and performance is given below:

2009-10 2008-09 GrowthTotal Income 5063.42 3830.55 32 %EBIDTA 1458.51 745.15 95 %Profit Before Tax (PBT) 1108.12 343.29 223 %Net Profit after tax (PAT) 715.87 226.16 216 %Earnings Per Share(EPS) 9.85 3.05 222%

INDIAN PHARMACEUTICAL MARKET

The India formulations market valued at Rs. 417 billion hasgrown at CAGR of 14% (Source: ORG - IMS) over last 4 years.New product introductions contributed to 44% of the salesgrowth while volume growth contributed to 51% of the salesgrowth. Growing population, increasing reach of healthcare,rising income levels and increasing government spend onhealthcare are driving the market growth. Indian market iswitnessing gradual transition from acute diseases to lifestylediseases and chronic therapies like Cardiology, Neurology,Psychiatry and Diabetes. With current demographic profile andgrowth prospects of the economy, Indian Pharmaceutical


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19

market could see continuing trend of transition towardschronic and super specialty therapies, with acute therapies likeAnti – Infectives retaining their market size. Over the comingyears, patent laws will provide an impetus to the launch ofpatent protected products. The market for patented productsis likely to be concentrated in therapeutic segments like Neuro-Psychiatry, Oncology, Anti-Infective, Gastro-Intestinal andCardiovascular. Such products have the potential to capture10% of the overall market in the coming years. However,outlook for generic products looks positive due to severalfactors. The current pipeline of the generic products that areeither undergoing new process development or have beenrecently launched is strong.

In addition, domestic players have the opportunity to developnew combinations and formulations of the products that arealready in the market. Generics players continue to have awide range of options for new generic launches from thebasket of pre 1995 products. Currently, the prices of 75 drugsare controlled as per the mandate issued by DPCO,1995.

Given the above developments, the critical success factors forthe pharma companies would be differentiated productintroductions, therapeutic expansion, expanding thegeographical reach by expanded sales, marketing networkand aggressive sales promotion.

GLOBAL PHARMACEUTICAL CONTRACTMANUFACTURING INDUSTRY

Global Contract Manufacturing to Post Double Digit Growth:The global pharmaceutical industry is witnessing rapidadvancements in processes and technology development,with automation emerging as an integral part of mostmanufacturing processes. Due to the implementation ofstringent regulatory norms and spiraling costs, pharmaceuticalcompanies are opting to outsource their manufacturingprocess to contract manufacturing organizations in order toimprove efficiency and productivity. As per new research report"Global Contract Manufacturing Market Analysis", thepharmaceutical contract manufacturing market is expected togrow at a CAGR of around 12% during 2010-2012. (Resource:PRLog (Press Release) - Jun 28, 2010)

The countries like India, Brazil, Ukraine, Mexico, China andSingapore have been emerging as the key destination forcontract manufacturing. Several factors like low cost ofmanufacturing and highly developed infrastructure haveboosted growth in the contract manufacturing industry. Thekey industry trends like biomanufacturing and changing qualityprocedures have been studied in the report. It is expected that

these trends will drive the overall industry in future. We havefound that pharmaceutical companies are increasinglyadopting the concept of ‘virtual pharma', wherein they retainthe marketing rights while outsourcing all manufacturingactivities and related processes. This allows companies todeliver goods at a faster rate than an internal plant would allow.

"Global Contract Manufacturing Market Analysis" providesextensive research and prudent analysis of the global contractmanufacturing industry. It studies the past and present markettrends to enable clients understand the market dynamics andopportunities for the expansion of business. The reporthighlights key industry issues and presents an unbiasedpicture of the industry. The report also includes informationabout the major players along with their business strategies atthe country level markets. Thus, the report could be veryvaluable for investors while taking decision on investments.

OUTLOOK ON THREATS, RISK AND CONCERNS

Pharmaceuticals Pricing: One of the very serious concerns forthe Pharmaceuticals division is Government regulation of pricesof medicines. The control extends two ways with the first beingon the cost of inputs where the Government determines thefixation of prices and the second being the conversion costwhich is yet again decided by the Government on the basis ofstudies carried out by them. Your Company has a very highpercentage of Government-price-controlled medicines and thebulk drug Vitamin E, and for the last several years theirperformance has been subject to the vagaries of a price-sensitive environment. The domestic market is subject to pricecontrol under DPCO, 1995. More and more products are beingadded to the list of controlled products and thereby, the profitmargins could be significantly affected. The Companymanagesits product portfolio so as to move away, reduce and minimizethe product weightage of drugs under price control.

Competitive pressures: Both the Pharmaceuticals andChemicals segments operate in a highly competitive marketscenario, making it necessary that they differentiatethemselves from competition by offering better qualityproducts at lower prices thus adding value to the customers.

Financial Risks: With the high amount of imports of rawmaterials and exports of finished goods transacted in foreigncurrencies the foreign exchange fluctuations have an impacton the working of the Company. By way of hedging of foreignexchange transactions wherever found prudent, the Companyminimizes the impact of foreign exchange loss. Due to thebroad customer base in Pharmaceuticals segment, theCompany is exposed to a low credit risk in its sales markets.


Prices of Inputs: The uncertainties in the prices of the inputsand even their availability were causes for concern last year,especially in the case of active pharmaceutical ingredientswhere prices have shown high amount of variations making itvery difficult for the Company to make accurate projectionsand sustain the operating results.

Growth through collaborations -Various JVs have been formedbetween Indian and MNC pharma players for strengtheningtheir manufacturing capabilities, technology-sharing andleveraging on the partner’s experience in product filings,regulatory compliance, etc. Recently, many Indian pharmacompanies have formed JVs for expanding into semi-regulatedmarkets.

Price control: The domestic market is subject to price controlunder DPCO, 1995. More and more products are being addedto the list of controlled products and thereby, the profit marginscould be significantly affected. The Company manages itsproduct portfolio so as to move away, reduce and minimizethe product weightage of drugs under price control.

Excise Free Zones: The policy of the government for creatingexcise free zones in few neighbouring states, has resulted inmushrooming of various new players and thereby put thecompany at a little bit of risk of shifting of few customers tosuch regions. Due to the long-standing experience in theindustry and customer satisfaction, risk posed by such actionon the part of the govt. has been mitigated to a large extent.

Weakness in domestic markets: Fierce price competition hasbecome the order of the day for the domestic pharma industry,which has restricted the ability of the domestic pharma marketto grow in value terms. Due to its highly fragmented structure,the pricing power of the players has been pruned. The Indianmarkets have traditionally been and continue to remain pricesensitive and premium pricing of products is extremely difficultto maintain .The new players in the industry are resorting tothe cutthroat price competition. However, the company hasbeen able to increase its product ranges and able to maintaina balance for its existing profit percentage.

INTERNAL CONTROL SYSTEMS AND ADEQUACY

Your company has reviewed internal controls and itseffectiveness through the internal audit process. Internal auditswere undertaken for every operational department and allmajor corporate functions under the direction of the InternalAudit department. The focus of these reviews are to Identifyweakness and areas of improvement; Compliance withdefined policies and processes; Safeguarding of tangible andintangible assets; Management of business and operationalrisks; Compliance with applicable statutes and the Ahlcon’s

Code of Conduct.

The internal control system provide for well-documentedpolicies, guidelines, authorisations and approval procedures.The Company has an Internal Audit Department, headed byChief Internal Audit Coordinator, which carries out auditsextensively throughout the year. The Internal Audit Departmentmake a executive summary to the Board and Audit Committeeon periodically basis. To make such control procedures afoolproof system, outside independent agencies are alsoemployed tomake test audit. The prime objective of such auditsis to test the adequacy and effectiveness of all internal controlslaid down by the management and to suggest improvements.

HUMAN RESOURCES & INDUSTRIAL RELATIONS

In keeping with the established principles & policies ofAHLCON, we have been continuously developing the internalpotential of the employees from the present level to the desiredlevel to sustain the growth of our company. Regular anddetailed performance appraisal system is in place to evaluatethe performance of all employees and the necessary steps aretaken to strengthen the areas which need improvements.Regular Training programmes, were organized for theemployees. The Company regards its human resourcesamongst its most valuable assets and proactively reviews andevolves policies and processes to attract and retain itssubstantial pool of scientific, technical and managerialresources through a work environment that encouragesinitiative, provides challenges and opportunities. Adequatefacilities and opportunities are also being provided to thetechnical and professional staff to update themselves in thefast changing era of technologies. More experienced technicalmanpower’s are being taken at the senior and middle level tostreamline the whole business process.

CAUTIONARY STATEMENT

The statements in this Report, particularly which relate toManagement Discussion and Analysis describing theCompany's objectives, plans, projections, estimates andexpectations, may constitute “forward looking statements”within the meaning of applicable laws and regulations. Actualresults may differ materially from those expressed or implied inthe statement depending on the circumstances, which arebeyond the control of the Company. The Company assumesno responsibility in respect of forward looking statementswhich may be amended or modified in the future on the basisof subsequent developments, information or events.

For and on behalf of the Board of Directors.

Place: New Delhi Bikramjit AhluwaliaDated: 14.08.2010 Chairman


18th Annual Report

REPORT ON CORPORATE GOVERNANCE

The best corporate governance practices have been adopted by Ahlcon Parenterals ( India) Ltd and the same is beingcontinuously reviewed to ensure that they adhere to the latest corporate developments and conform to the best corporategovernance ethics.

In accordance with Clause 49 of the listing agreement with the stock exchanges, the details of compliance by the Company areas under:

1. BOARD OF DIRECTORS

The Board is having a non-executive Chairman and appropriate composition of Executive and Non- Executive Directorsconforming to the specification provided in the Listing Agreement. All the Directors are equipped with variety of perspectivesand skills, to ensure effectiveness of the Board, facilitating efficient discharge of duties and adding value in the context ofthe Company’s circumstances.

The composition and category of Board of Directors is as follows:

Name of Category Board Attendance No. of Number of Date ofDirector Meeting at the Directorship Committee Appointment/

Attended Last AGM in other membership held in other Resignationheld on Companies Companies30/09/09

Chairman Member

Mr. Bikramjit Ahluwalia Chairman (promoter) SinceNon Executive 5 YES 3 Nil Nil Incorporation

Dr. Rohini Ahluwalia Vice Chairperson 01.04.1994,(WTD) (Promoter 4 NO 2 Nil 1 elevated as Vice& Executive) Chairperson since

29.07.2006and reappointed as

WTD from 01.04.2009

Mrs. Sudarshan Walia Director (Promoter)Non Executive 3 YES 3 1 2 Since Incorporation

Mr. Arun Kumar Gupta Independent DirectorNon Executive 5 YES 2 1 2 15.03.1993

Dr. S. S. Arora Independent DirectorNon Executive 3 YES NIL Nil Nil 30.01.2002

Prof. G. P. Talwar Independent DirectorNon Executive 4 NO NIL Nil Nil 30.01.2002

Dr. S.C. L. Gupta Independent DirectorNon Executive 5 NO NIL Nil Nil 29.01.2003

Mr. S. K. Sachdeva Non Executive Director 5 YES 1 Nil Nil 30.01.2009

Five Board meetings of the Company were held during the year on the following dates:

I.30.06.2009, II.31-07-2009, III.31-10-2009, IV.30.01.2010, V.03.03.2010.


None of the Directors on the Board hold directorship inmore than fifteen companies and no Director is a memberof more than 10 committee and Chairman of more than 5Committee (as specified in Clause 49), across all theCompanies of which he/she is a Director. The Directorshave made the necessary disclosures regardingdirectorship and committee positions in other companies.

2. BOARD AND ITS SUBORDINATE COMMITTEES

With a view to sub serve the functions specificallyprescribed by Clause 49 of the listing agreements; thecompany has constituted an Audit Committee,Remuneration Committee and Shareholders GrievanceCommittee. The following report depicts the compositionof the committees and also the nature of functionsperformed by them during the year under report:

Audit Committee

The Board has constituted an Audit Committee on dated30th April 2002 and nominated Mr. Arun K Gupta, anIndependent Director and a Chartered Accountant byprofession, as the Chairman of the Committee. The roleand powers of the audit committee as stipulated by theBoard are in accordance with the items listed in Clause 49(II) (C) & (D) of the Listing Agreement and as per Section292A of the Companies Act 1956.

Five meetings of the Committee were held during the yearon the following dates:

I.28.05.2009, II. 30.06.2009, III. 31.07.2009, IV. 30.10.2009,V. 30.01.2010

The composition and other details of the Audit Committeeare as follows.

Name of the Designation Nature of No. ofDirector Directorship meetings

attended

Mr. Arun Kumar Chairman IndependentGupta Director 5Dr. S.S. Arora Member Independent

Director 5Dr. Rohini Member Vice ChairAhluwalia person

(WTD) 2Dr. S C L Gupta Member Independent

Director 5

The Statutory Auditors and the Internal Auditors of theCompany were also invited to attend the Audit Committeemeetings along with the Incharge of Finance (CFO) andCompany Secretary. As per the need, other keyfunctionaries of the company were also invited to attendthe meetings.

Remuneration Committee

The Board has set up a Remuneration Committee toformulize company’s policy on remuneration packages ofthe executive directors and determine the same from timeto time.

The composition and other details of the remunerationcommittee are as follows.

Name of the Designation Nature ofDirector Directorship

Prof G P Talwar Chairman IndependentDirector

Mr. Arun Kumar Member IndependentGupta DirectorDr. S.S.Arora Member Independent

Director

Details of remuneration paid to Directors for the year2009-10

The details of the remuneration paid to the ExecutiveDirectors during the year 2009-10 are as under:

Executive Directors Dr. Rohini Ahluwalia,(WTD, VC, CEO)(In Rs.)

Salary and allowances 16,80,000Contribution to P.F 2,01,600Perquisites 24,692Gratuity -Total 19,06,292

Note: Whole Time Director is covered under theCompany's gratuity scheme along with the otheremployees of the Company. The gratuity liability isdetermined for all the employees on overall basis by anindependent actuarial valuation. The specific amount ofgratuity for whole time directors cannot be ascertainedseparately and accordingly the same has not beenincluded in the above note.

There is no any fixed component or commission as


18th Annual Report

performance linked incentives for the executive directors.

No severance fee or notice period is specified.

Presently, the company does not have a scheme for grantof Stock Options either to the Executive Directors oremployees.

Dr. Rohini was holding 4,69, 710 Equity Shares of thecompany, as on 31st. March, 2010.

Statement of sitting fees paid to Non- Executive Directorfor the year 2009-10 and their shareholding position as on31.03.2010.

Non Executive Director Sitting fees Share(Rs.) Holding

Mr. Bikramjit Ahluwalia NIL 2596312Ms. Sudarshan Walia NIL 709610Mr. Arun Kumar Gupta 20000 50Dr. S. S. Arora 16000 NILDr. G .P. Talwar 8000 500Dr. S.C. L. Gupta 18000 NILMr.S.K .Sachdeva NIL NIL

The above figures are inclusive of fees paid for theattendance of the Committee meetings.

Shareholders’/ Investors’ Grievance Committee

The Board of Directors of the Company has constituted aShareholders’/Investors’ Grievance Committee,comprising of Prof. G P Talwar, Chairman, Dr. S C L Gupta,Member, Dr. Rohini Ahluwalia, member, interalia approvesissue of duplicate certificates and oversees and reviews allmatters connected with the securities transfers. TheCommittee also looks into redressal of shareholders’complaints like transfer of shares, non-receipt of balancesheet etc. The Committee oversees the performance of theRegistrar and Transfer Agents, and recommends measuresfor overall improvement in the quality of investor services.The Board of Directors have delegated the power ofapproving transfer of securities to the Company Secretary.

The Board has designated Shri Ranjan Kumar Sahu,Company Secretary & Manager-Legal, as the ComplianceOfficer.

During the period under review, 37 investors’ complaintswere received and all of them have been resolved to thesatisfaction of the investors.

3. BOARD PROCEDURE

The Chairman of the Board and the Company Secretary inconsultation with other concerned persons in the seniormanagement, finalise the agenda papers for the BoardMeetings. All divisions/departments in the Company areencouraged to plan their functions well in advance,particularly with regard to matters requiringdiscussion/approval/decision in the Board/ CommitteeMeetings. All such matters are communicated to theCompany Secretary in advance so that the same could beincluded in the Agenda for the Board Meetings. Agendapapers are circulated to the Directors, in advance and allmaterial information is incorporated in the Agenda Papersfor facilitating meaningful, informed and focuseddiscussions at the meeting. Where it is not practicable toattach any document to the Agenda, the same are placedon the table at the meeting with specific reference to thiseffect in the Agenda.

4. COMPLIANCE

The Company Secretary while preparing the agenda,notes on agenda, minutes etc. of the meeting(s) andholding and conducting the meetings, is responsible forand is required to ensure adherence to all the applicableprovisions of law including the Companies Act, 1956 andthe Secretarial Standards recommended by the Institute ofCompany Secretaries of India, New Delhi.

5. CODE OF CONDUCT

A code of Conduct for the Board members and seniormanagement of the company has been laid down by theBoard and it is posted on the website of the company. Thesame has been circulated to all the concerned who haveaffirmed the compliance with it. The declaration by the viceChairperson (CEO) to that effect part of this report asAnnexure I.

6. CEO/CFO Certification

The CEO/CFO of the company have certified to the Boardas required under Clause (V) of the Listing Agreement. Acopy of the certificate is attached hereto.

7. GENERAL BODY MEETINGS

Annual General Meetings

Location and time for last 3 Annual General Meetings wereas follows:


Year, Location, Date and Time:

2006-07 Ahlcon Public School Auditorium, Mayur Vihar,Phase-I, Delhi-92 on

29th September 2007 at 3.00 P.M

2007-08 Same as above 30th September 2008 at 3.00 P.M

2008-09 Same as above 30th September 2009 at 3.00 P.M

II Special Resolutions passed in the previous three years

Year 2006-07:

No Special resolution was passed in this meeting

Year 2007-08:

One Resolution: One relating to increase of managerialremuneration of Whole time director.

Year 2008-09:

One Resolution: One relating to Reappointment of WholeTime Director.

III. Passing of postal ballot: No resolution was passedthrough postal ballot in the last year.

IV. No resolution is proposed to be conducted through postalballot in the ensuing Annual General Meeting.

8. DISCLOSURES

a) Disclosures on materially significant related partytransactions i.e. transactions of the Company of materialnature, with its promoters, the directors or themanagement, their subsidiaries or relatives, etc. that mayhave potential conflict with the interests of the Company atlarge.

None of the transactions with any of the related partieswere in conflict with the interest of the Company.

b) Details of non-compliance by the Company, penalties, andstrictures imposed on the Company by Stock Exchangesor SEBI, or any statutory authority, on any matter relatedto capital markets, during the last three years.

No penalty or strictures had been imposed on thecompany by any regulatory authorities relating to capitalmarkets in the last three years.

c) Whistle Blowing Policy Mechanism.

Considering the nature and size of the company, no such

mechanism has been established as on date.

9. Means of Communication:-

The quarterly, half yearly and annual financial results of thecompany were published in leading national newspapernamely, Economics Times, Nav Bharat Times alongwithBusiness Standard/ The Pioneer in English and Veer Arjunin Hindi. The same is displayed in the company’s websitewww.ahlconindia.com for public information.

10. The Management Discussion and Analysis Report formspart of this Annual Report.

11. GENERAL SHAREHOLDER INFORMATION

11.1 18th Annual General Meeting

The 18th Annual General Meeting of the company will beheld on Friday, 17th day of September, 2010 at AhlconPublic School Auditorium, Mayur Vihar, Phase-I, Delhi-91at 3.00 P.M.

11.2: Tentative Financial Calendar for the year 2010-2011:

First Quarter results: During August, 2010

Second quarter results: During November, 2010

Third quarter results: During February, 2011

Fourth Quarter Result: Before end of May, 2011

11.3. Date of Book closer:

From 10th September,2010 to 17th September,2010 (bothdays inclusive), for the purpose of distribution of Dividendand Annual General Meeting.

11.4. Dividend payment date:

The Board has recommended a final dividend of Re. 1.50(One Rupees & Paisa Fifty only) per Equity share havinga face value of Rs.10/- each subject to the approval of theshareholders. The dividend declared at the AGM will bepaid to those members, whose names are on the Registerof Members of the company as on the opening hours ofSeptember, 10th 2010.

11.5. Listing of Equity Shares on Stock Exchanges at:

Mumbai, Calcutta, New Delhi and Jaipur.

Note: The Company has paid Annual Listing Fee 2010-2011 to each of these Stock Exchanges and theirrespective addresses have been given in the AnnualReports sent to member’s alongwith the notice of the 18th


18th Annual Report

Month High Low

April, 2009 21.90 17.00May, 2009 29.00 21.00June, 2009 32.00 22.40July, 2009 30.35 22.55August, 2009 40.00 27.55September, 2009 39.95 35.25October, 2009 40.00 35.00November, 2009 38.25 35.05December, 2009 41.00 36.10January, 2010 51.90 38.05February, 2010 51.25 43.00March, 2010 52.90 45.00

Annual General Meeting of the company.

11.6 a) Stock Code: Trading Symbol - Bombay StockExchange Ltd : ‘524448’ Ahlcon Paren

b) Demat ISIN Numbers in NSDL & CDSL for EquityShares: ISIN No. INE027C01011.

c) Stock Market Data (In Rs./per share) in the year inBombay Stock Exchange Limited (BSE) with Month’sHigh and Low:

11.7 Registrars and Transfer Agents:

M/s MAS Services Ltd.T-34, 2nd Floor,Okhla Industrial Area,Phase-II,New Delhi-110 020Tel. No.-011-26387281/82/83Fax No.- 011-26387384e.mail: [email protected]

11.8. Share Transfer System

Presently, the share transfers which are received inphysical form are processed and the share certificatesreturned within a period of 10 to 15 days from the date ofreceipt, subject to the documents being valid andcomplete in all respects. The share Certificates aredespatched within a period of one month from the date ofits receipt. All the demateralisation request received fromthe shareholders are confirmed within the specified periodof 21 days from the date of its generation of DRN Numberby the DPs and physically received in the office of the RTA.

Share or Debenture holding Number Share holders Share Amountof nominal Value of Rs.10/- each of Share

Rs. Rs. Number % to total (in Rs.) % to total

Upto 5,000 581390 4207 91.457 5813900 8.0755,001 10,000 178964 213 4.630 178964 2.48610,001 20,000 109090 69 1.500 1090900 1.51520,001 30,000 72414 28 0.609 724140 1.00630,001 40,000 70986 19 0.413 709860 0.98640,001 50,000 65866 14 0.304 658660 0.91550,001 1,00,000 191613 25 0.543 916130 2.6611,00,001 and above 5929827 25 0.543 59298270 82.357TOTAL 7200150 4600 100.000 72001500 100.000

SHAREHOLDING PATTERN AS ON 31ST MARCH, 2010

Sl. No. Category No of Shares held % of Shareholding

1 Promoters 47,93,205 66.572 NRI’s, OCB’s etc. 9224 0.1283 Mutual Funds, Banks, FII’s 0 04 Bodies Corporate 1112909 15.455 Indian Public 1270002 17.636 Clearing Member 14810 0.20

TOTAL 72,00,150 100.00

11.9. Distribution of share holders as on 31st March, 2010


11.10. Dematerialisation of Shares

94.437% of the Company’s paid-up equity share capitalhas been dematerialised as on 31st March, 2010. Tradingin Equity Shares of the Company is permitted only indematerialised form as per notification issued by theSecurities and Exchange Board of India (SEBI).

Liquidity

The shares of the company are being regularly traded inthe Bombay Stock Exchange.

11.11. Plant Location- Bhiwadi

SP- 917 & 918, Phase-III, Bhiwadi, Dist- Alwar,

Rajasthan-301019

11.12. Address for Correspondence

For share transfer, transmission and demateralisationrequest

M/s MAS Services Ltd.T-34, 2nd Floor, Okhla Industrial Area,Phase - II,New Delhi - 110 020Ph:- 26387281/82/83,Fax:- 26387384,

email:- [email protected], website : www.masserv.com

Any assistance relating to such matters or Annual Reportmay be taken up with Mr. Ranjan Kumar Sahu, CompanySecretary & Manager-Legal at the registered officeof the company at 4, Community Centre, Saket,New Delhi-110017, Telefax Nos. 011-26852036, email:[email protected] or [email protected].

Annexure 1 to the Corporate Governance Report

To the Shareholders

Affirmation of compliance with Code of Business Conduct.I, Dr. Rohini Ahluwalia, Vice Chairperson (CEO) declare thatthe Board of Directors of the Company has receivedaffirmation on compliance with the Code of Business Conductfor the period from 1st April, 2009 or date of their joining theCompany, whichever is later to 31st March, 2010 from allmembers of the Board and employees under SeniorManagement Cadre.

Place : New Delhi Dr. Rohini AhluwaliaDate : 14.08.2010 Vice Chairperson (CEO)

AUDITORS’ CERTIFICATETo

The members of

Ahlcon Parenterals (India) Limited

We have examined the compliance of conditions of Corporate Governance by Ahlcon Parenterals (India) Limited for the yearended on March 31, 2010, as stipulated in Clause 49 of the Listing Agreement of the said company with Stock Exchange(s).

The Compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limitedto procedures and implementation thereof, adopted by the company for ensuring the compliance of the conditions of thecorporate Governance. It is neither an audit nor an expression of opinion of the financial statement of the Company.

In our opinion and the to the best of our information and according to the explanation given to us, we certify that the Companyhas complied with conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement.

We state that no investor grievance is pending for a period of exceeding one month against the Company as per the recordsmaintained by the Shareholders / investor Grievance Committee.

We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency oreffectiveness with which the management has conducted the affairs of the Company.

For ARUN K. GUPTA & ASSOCIATESChartered Accountants

SACHIN KUMARPartner

Place: New Delhi M.NO. 503204Dated: 14.08.2010 Firm Registration No. 000605N


18th Annual Report

CERTIFICATION BY THE CHIEF EXECUTIVE OFFICER ANDCHIEF FINANCIAL OFFICERToThe Board of Directors,Ahlcon Parenterals (India) Limited4,Community Centre, Saket,New Delhi-110017 Dated: 29.05.2010

We hereby certify that for the financial year ending 31st March, 2010, on the basis of the review of the financial statements andthe cash flow statement and to the best of our knowledge and belief that:-

1. These statements do not contain any materially untrue statement or omit any material fact or contain statements that mightbe misleading;

2. These statements together present a true and fair view of the Company’s affairs and are in compliance with existingaccounting standards, applicable laws and regulations;

3. There are, to the best of our knowledge and belief, no transactions entered into by the Company during the year ended on31st March 2010, which are fraudulent, illegal or violative of the Company’s code of conduct.

4. We accept responsibility for establishing and maintaining internal controls. We have evaluated the effectiveness of theinternal control system of the company and we have disclosed to the auditors and the Audit Committee those deficiencies,of which we are aware, in the design of operation of the internal control systems and that we have taken the required stepsto rectify there deficiencies.

5. We further certify that: -

a) There have been no significant changes in internal control during this year.

b) There have been no significant changes in accounting policies during this year.

c) There have been no instances of significant fraud of which we have become aware and involvement therein, ofmanagement or an employee having a significant role in the company’s internal control system.

Dr. Rohini Ahluwalia Rajeev Kumar WaliaVice Chairperson (CEO) Chief Financial Officer


AUDITORS’ REPORT

To,The Members ofAHLCON PARENTERALS (INDIA) LIMITED.

1. We have audited the attached Balance Sheet of AhlconParenterals (India) Ltd., as at 31st March 2010, and alsothe Profit and Loss account and the Cash Flow Statementfor the year ended on that date annexed thereto. Thesefinancial statements are the responsibility of thecompany’s management. Our responsibility is to expressan opinion on these financial statements based on ouraudit.

2. We have conducted our audit in accordance with theauditing standards generally accepted in India. ThoseStandards require that we plan and perform the audit toobtain reasonable assurance about whether the financialstatements are free of material misstatement. An auditincludes examining, on a test basis, evidence supportingthe amounts and disclosures in the financial statements.An audit also includes assessing the accounting principlesused and significant estimates made by management, aswell as evaluating the overall financial statementpresentation. We believe that our audit provides areasonable basis for our opinion.

3. As required by the Companies (Auditor’s Report) Order,2003(as amended) issued by the Central Government ofIndia in terms of sub-section (4A) of section 227 of theCompanies Act, 1956, we enclose in the Annexure astatement on the matters specified in paragraphs 4 and 5of the said Order.

4. Further to our comments in the Annexure referred toabove, we report that:

i) We have obtained all the information and explanations,which to the best of our knowledge and belief werenecessary for the purposes of our audit;

ii) In our opinion, proper books of account as required bylaw have been kept by the company so far as appears

from our examination of those books;

iii) The balance sheet, profit and loss account and cash flowstatement dealt with by this report are in agreement withthe books of account;

iv) In our opinion, the balance sheet, profit and loss accountand cash flow statement dealt with by this report complywith the accounting standards referred to in sub-section(3C) of section 211 of the Companies Act, 1956;

v) On the basis of written representations received from thedirectors, as on 31st March 2010 and taken on record bythe Board of Directors, we report that none of the directorsis disqualified as on 31st March 2010 from beingappointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956;

vi) In our opinion and to the best of our information andaccording to the explanations given to us, the saidaccounts give the information required by the CompaniesAct, 1956, in the manner so required and give a true andfair view in conformity with the accounting principlesgenerally accepted in India:

a) in the case of the balance sheet, of the state of affairs ofthe company as at 31st March 2010;

b) in the case of the profit and loss account, of the profit forthe year ended on that date; and

c) in the case of the cash flow statement, of the cash flows forthe year ended on that date.


SACHIN KUMARPartner



18th Annual Report

ANNEXURE TO THE AUDITORS’ REPORT(Referred to in paragraph 3 of our report of even date)

Ahlcon Parenterals (India) Limited

1. The company has maintained proper records showing fullparticulars including quantitative details and situation offixed assets. The management during the year hasphysically verified the fixed assets and no materialdiscrepancies have been noticed on such verification. Inour opinion, the frequency of physical verification of fixedassets is reasonable having regard to the size of theCompany and the nature of its business. In our opinionthe company has not disposed of any substantial part ofits fixed assets during the year and the going concernstatus of the company is not affected.

2. The management has conducted physical verification ofinventory at reasonable intervals. The procedures ofphysical verification of inventory followed by themanagement are reasonable and adequate in relation tothe size of the Company and the nature of its business.The Company is maintaining proper records of inventoryexcept for work in progress, which has been determinedon the physical verification at the year-end. No materialdiscrepancies in inventory were noticed on physicalverification.

3. i) As informed to us, the Company has not granted anyloan, secured or unsecured to companies, firms orother parties covered in the register maintained undersection 301 of the Companies Act, 1956.

ii) As informed to us, the Company has not taken anyloan, from companies, firms or other parties coveredin the register maintained under section 301 of thecompanies Act, 1956.

4. In our opinion and according to the information andexplanations given to us, there is an adequate internalcontrol commensurate with the size of the Company andthe nature of its business, for the purchase of inventoryand fixed assets and for the sale of goods and services.Accordingly the issue of continuing failure to correct majorweakness in internal control in these areas does not apply.

5. According to the information and explanations given to us,

there are no transactions made in pursuance of contractsor arrangements entered into the register maintainedunder Section 301 and exceeding the value of five lakhrupees.

6. The Company has not accepted any deposits from thepublic within the meaning of section 58A & 58AA of theCompanies Act, 1956 and the rules made there under.

7. In our opinion, internal audit system of the company iscommensurate with the size and nature of its business.

8. We have broadly reviewed the books of accountmaintained by the Company pursuant to the Rules madeby the Central Government for the maintenance of CostRecords under Section 209 (1) (d) of the Companies Act,1956 and we are of the opinion that prima facie theprescribed accounts and records have been made andmaintained. We have, however not made a detailedexamination of the records.

9. i) According to the records of the company, thecompany is generally regular in depositingundisputed statutory dues including Provident Fund,Investor Education and Protection Fund, Employees’State Insurance, Income-Tax, Sales-Tax, Service Tax,Wealth Tax, Custom Duty, Excise-Duty, Cess andother material statutory dues applicable to it with theappropriate authorities. According to the informationand explanations given to us, there are no undisputedamounts payable in respect of Wealth Tax, Sales Tax,Service Tax, Customs duty and Excise dutyoutstanding, as at 31st March 2010 for a period ofmore than six months from the date they becamepayable except for Entry Tax (Rajasthan) Rs.1,93,835/-for F.Y 2007-08, Rs.1,78,196/- for F.Y 2008-09 and Rs.5,02,992/- for F.Y. 2009-10 and Income Tax of Rs.2,26,864/- & Rs. 1,04,936/- respectively for F.Y. 2000-01 & 2002-03.

ii) According to the records of the Company, the duesoutstanding of Income Tax, Sales Tax, Customs Duty,Wealth Tax, Excise Duty and Cess on account of anydispute are as under:


Nature of statute Nature of dues Amount Period to which Forum where dispute(Rs.) amount relates is pending

Income-tax Act, 1961 Income tax demand and 43,334 F.Y 2004-05 CIT Appeal, Delhiinterest due thereon

Value Added Tax Interest on Vat demand 4,981 F.Y 1999-00 ACST Bhiwadi-do- -do- 5,460 F.Y 2003-04 -do-

-do- -do- 422 F.Y 2004-05 -do-

Central Excise Act, 1944 Cenvat Credit not availableon inputs 520,647 F.Y 2004-05 Cases under remand (Asstt.

Comm Bhiwadi)

-do- Penalty on above 520,647 -do- -do-

-do- Cenvat Credit not available on inputs 424,139 April 05 to Oct 05 -do-

-do- Cenvat Credit not available on inputs 484,992 Nov 05 to March 06 Customs, Excise and ServiceTax Appellate

Tribunal, New Delhi-do- Penalty on above 50,000 -do- -do-

-do- Cenvat Credit not available on inputs 535,897 April 06 to Sept. 06 -do-


-do- Cenvat Credit not available 155,531 Jan. 07 to June 07 Commissioner – (Appeal),on inputs Central Ecxise,Jaipur-I

-do- Cenvat Credit not available on inputs 280,831 July 07 to Dec 07 -do-


-do- Cenvat Credit not available on inputs 283,587 Jan 08 to May 08 -do-


-do- Cenvat Credit not available on inputs 4,590,131 July 05 to March 06 Customs, Excise and ServiceTax Appellate Tribunal,New Delhi

-do- Penalty on above 6,090,131 -do- -do-

-do- Cenvat Credit not available on inputs 4,135,140 25.04.05 to 31.03.06 -do-

-do- Penalty on above 2,167,708 -do- -do-

-do- Excise duty demand 195,329 F.Y. 2008-09 Commissioner – (Appeal),Central Ecxise, Jaipur-I


-do- Penalty on above 16,000 F.Y. 2004-05 to F.Y. 2007-08Asstt. Commissoner, Bhiwadi

-do- Excise duty demand 149,586 -do- -do-


Service Tax Penalty on service tax on GTA 113,189 April 05 to Sept. 05 High Court, Rajasthanadjusted against CENVAT instead ofmaking payments

-do- Service Tax cenvat credit reversed 901,021 April 05 to Sept. 05 Commissioner, Central Excise,during excise audit Jaipur-I

-do- Demand of Service Tax on foreignbased service providers 75,000 -do- -do-


18th Annual Report

10. The Company has no accumulated losses at the end ofthe financial year and it has not incurred any cash lossesin the current and immediately preceeding financial year.

11. Based on our audit procedures and on the informationand explanations given by the management, we are of theopinion that the Company has not defaulted in repaymentof dues to financial institutions or bank.

12. According to the information and explanation given to usand based on the documents and records produced tous, the Company has not granted loans and advances onthe basis of security by way of pledge of shares,debentures and other securities.

13. In our opinion and according to the information andexplanation given to us, the nature of activities of theCompany does not attract any special statute applicableto chit fund, nidhi / mutual benefit fund and Societies.

14. The Company has not dealt / traded in shares, securities,debentures and other investments.

15. We have been informed that the company has not givenany guarantee for loans taken by others from bank &financial institutions.

16. Based on information and explanations given to us by themanagement the term loans were applied for the purposefor which loans were obtained.

17. According to the information & explanation given and onthe basis of overall examination of balance sheet of thecompany in our opinion no short terms funds have beenused for long-term investments during the year.

18. During the year the company has not made any preferentialallotment of shares to parties and companies covered in theregister maintained under section 301 of the Act.

19. During the year covered by our audit, the Company hasnot issued any debentures.

20. The company has not raised any money through a publicissue during the year.

21. Based upon the audit procedures performed by us forexpressing our opinion on these financial statements andas per information & explanations given by themanagement, we report that no fraud on or by theCompany has been noticed or reported during the courseof our audit.


SACHIN KUMARPartner



BALANCE SHEET AS AT 31ST MARCH, 2010

Particulars Schedule As at As at31-03-2010 31-03-2009(Rs.) (Rs.) (Rs.) (Rs.)

SOURCES OF FUNDSShareholders Funds:Share Capital 1Equity Share Capital 72,001,500 72,001,500Preference Share Capial 9,000,000 81,001,500 9,000,000 81,001,500Reserves and Surplus 2 270,301,159 211,981,360Loan Funds: 3Secured Loans 100,431,665 130,277,507Deferred Tax Liability 47,295,718 46,682,505TOTAL 499,030,042 469,942,872

APPLICATION OF FUNDSFixed Assets: 4 620,654,918 607,418,262Depreciation 274,926,189 254,067,232Net Block 345,728,729 353,351,030Capital Work in Progress 29,171,018 23,982,772Current Assets, Loans & AdvancesInventories 5 48,378,888 43,832,285Sundry Debtors 6 108,504,878 75,567,966Cash & Bank Balances 7 30,253,344 5,267,055Other Current Assets 8 3,937,499 2,359,715Loans & Advances 9 17,961,889 21,017,282

209,036,498 148,044,303Less: Current Liabilities & Provisions. 10Current Liabilities 67,610,848 38,332,559Provisions 17,295,355 17,146,147Net Current Assets 124,130,295 92,565,597Miscellaneous Expenditure (to the 11 - 43,473extent not written off or adjusted )

TOTAL 499,030,042 469,942,872

The schedules referred to above and notes to accounts form an integral part of the Balance Sheet.

As per our report of even dateFor Arun K. Gupta & AssociatesChartered AccountantsFirm Registration No : 000605N

Sachin Kumar Bikramjit Ahluwalia Dr. Rohini AhluwaliaPartner Chairman Vice Chairperson, (CEO)M. No: 503204

Rajeev Kumar Walia Ranjan Kumar SahuPlace : New Delhi Chief Financial Officer Company SecretaryDate : 29-05-2010


18th Annual Report

Particulars Schedule Current Year Previous Year(Rs.) (Rs.)

INCOMESales 12Gross Sales 549,326,047 438,952,376Less Excise Duty 46,435,868 60,649,888Net Sales 502,890,179 378,302,488Other Income 13 3,452,384 4,753,149Increase / (Decrease) in Stock 14 (1,386,579) (6,543,869)Total 504,955,984 376,511,768EXPENDITUREMaterial 15 167,567,308 135,481,561Personnel 16 72,252,600 61,585,027Expenses 17 113,440,643 106,147,313Financial Charges 18 16,799,454 18,867,883Depreciation 21,954,439 22,290,723Miscellaneous expenditure written off 43,473 134,440Total 392,057,917 344,506,947Profit before provisions and tax 112,898,067 32,004,821Provision for Doubtful Debts - (1,480,785)Provision for Doubtful Advances (203,942) (326,102)Provision for Obsolete Stock (1,390,016) (1,394,832)Provision for Doubtful Debts Writtten Back 170,486 1,375,519Provision for Doubtful Advances Writtten Back 326,102 230,072Provision for Obsolete Stock Writtten Back 81,850 1,001,230Prior Period Adjustments (1,070,172) 2,919,474Profit before tax 110,812,375 34,329,397Provision for Current Income Tax 38,210,000 10,350,000Income Tax paid for earlier years 379,710 29,770Provision for Fringe Benefit Tax - 627,106Provision for Deferred Tax 613,213 706,513Provision for Wealth Tax 22,157 -Net Profit after Tax 71,587,295 22,616,008Balance brought forward from previous year 152,227,114 147,878,602Profit available for appropriation 223,814,409 170,494,610Proposed Dividend on Preference Shares 540,000 540,000Tax on Dividend on Preference Shares 91,773 91,773Proposed Dividend on Equity Shares 10,800,225 10,800,225Tax on Dividend on Equity Shares 1,835,498 1,835,498Profit transferred to General Reserve 6,000,000 5,000,000Surplus carried to Balance Sheet 204,546,913 152,227,114Earning per Share ( Face value Rs.10/ each)Basic 9.85 3.05Diluted 9.85 3.05

PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH, 2010


Sachin Kumar Bikramjit Ahluwalia Dr. Rohini AhluwaliaPartner Chairman Vice Chairperson, (CEO)M. No: 503204Place : New Delhi Rajeev Kumar Walia Ranjan Kumar SahuDate : 29-05-2010 Chief Financial Officer Company Secretary


Particulars As at As at31-03-2010 31-03-2009

(Rs.) (Rs.)

SCHEDULE 01 - SHARE CAPITALAuthorised110,00,000 Equity Shares of Rs. 10/- each 110,000,000 110,000,00070,00,000 Preference Shares of Rs.10/- each 70,000,000 70,000,000

180,000,000 180,000,000Issued & Subscribed72,00,150 Equity Shares of Rs. 10/- each 72,001,500 72,001,500900000, 6% Redeemable Cum. PreferenceShares of Rs.10/- each 9,000,000 9,000,000

81,001,500 81,001,500Paid up7200150 (Previous year 7200150) Equity Sharesof Rs.10/- each fully paid up. 72,001,500 72,001,500900000 (Previous Year 900000), 6% Redeemable 9,000,000 9,000,000Cum. Preference Shares of Rs.10/- each fullypaid up. (Preference shares are redeemable atpar by way of a put and call options at any timeafter a period of two years from the date of theirallotment i.e 28.10.2006 by giving one monthprior notice either by the company orby preference shareholders.)(Refer Note No 9 in Schedule 19)

81,001,500 81,001,500

SCHEDULE 02 - RESERVES AND SURPLUS

Capital ReserveState Subsidy on Fixed Capital Investment 1,721,246 1,721,246Surplus on Reissue of Forfeited Shares 33,000 1,754,246 33,000 1,754,246General ReserveOpening 29,000,000 24,000,000Transferred from Profit and Loss A/c 6,000,000 35,000,000 5,000,000 29,000,000Capital Redemption ReserveOpening 29,000,000 29,000,000Transferred from Profit and Loss A/c - 29,000,000 - 29,000,000Surplus in Profit & Loss AccountOpening 152,227,114 147,878,602Surplus in Profit & Loss A/c 52,319,799 204,546,913 4,348,512 152,227,114

270,301,159 211,981,360

SCHEDULE 03 - LOAN FUNDS

Secured Loans (Refer Note no 8 in Schedule 19)Working Capital Loan From:Scheduled Bank 47,707,489 68,103,609Term Loans From:Scheduled Bank 51,213,526 62,114,250Vehicle Loans From:Scheduled Banks 1,510,650 59,648

100,431,665 130,277,507


18th Annual ReportPA

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Adjustments

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AsAt

AsAt

01-04-20

09du

ringtheyear

durin

gtheyear

31-03-20

1031

-03-20

0931

-03-20

1031

-03-20

1031

-03-20

09(Rs.)

(Rs.)

(Rs.)

(Rs.)

(Rs.)

(Rs.)

(Rs.)

(Rs.)

(Rs.)

(Rs.)

Land

(Leasehold)

29,029,518

--

29,029

,518

1,337,197

293,227

-1,630,425

27,399

,093

27,692,321

Buildings

87,274,107

--

87,274

,107

21,982,779

2,914,953

-24,897,731

62,376

,376

65,291,328

Improvem

entinBuilding

6,405,408

--

6,40

5,40

86,405,408

--

6,405,408

--

Plant&

Machinery

460,572,903

5,510,327

-46

6,08

3,23

0210,139,737

16,697,463

-226,837,200

239,24

6,03

0250,433,166

Furniture&Fixtures

6,718,299

270,333

-6,98

8,63

24,170,497

791,773

-4,962,270

2,02

6,36

22,547,802

OfficeEquipm

ent

11,980,444

1,094,737

-13

,075

,181

7,735,153

473,827

-8,208,980

4,86

6,20

14,245,291

Vehicles

5,292,295

5,394,058

2,223,059

8,46

3,29

42,236,568

603,273

1,102,901

1,736,940

6,72

6,35

43,055,727

IntangibleAsset-Softw

are

145,288

3,190,260

-3,33

5,54

859,893

187,342

-247,235

3,08

8,31

385,395

SubTotal(A)

607,41

8,26

215

,459

,715

2,22

3,05

962

0,65

4,91

825

4,06

7,23

221

,961

,858

1,10

2,90

127

4,92

6,18

934

5,72

8,72

935

3,35

1,03

0Ca

pitalW

orkin

Progress

Plant&

MachineryUnder

Erection

347,360

562,606

347,360

562,60

6-

--

-56

2,60

6347,360

AdvancePaidforCapital

Goods

-4,973,000

-4,97

3,00

0-

--

-4,97

3,00

0-

BuildingUnderConstruction

23,635,412

--

23,635

,412

--

--

23,635

,412

23,635,412

SubTotal(B)

23,982

,772

5,53

5,60

634

7,36

029

,171

,018

--

--

29,171

,018

23,982

,772

Total(Cu

rrentYear)

631,40

1,03

420

,995

,321

2,57

0,41

964

9,82

5,93

625

4,06

7,23

221

,961

,858

1,10

2,90

127

4,92

6,18

937

4,89

9,74

737

7,33

3,80

2

Total(Previous

Year)

632,53

8,56

43,15

0,01

74,28

7,54

763

1,40

1,03

423

4,55

3,37

922

,290

,723

2,77

6,87

025

4,06

7,23

237

7,33

3,80

239

7,98

5,18

5

SC

HE

DU

LE-

04FI

XE

DA

SS

ETS



(Rs.) (Rs.)

SCHEDULE 05 - INVENTORIES(Taken as valued and certified by the management)Raw Materials 13,702,493 8,803,787Goods for Resale - 55,040Finished Goods 12,266,976 14,049,911Stores & Spares 11,099,053 11,123,489Packing Material 8,314,274 5,892,156Work in Progress 6,227,714 5,857,628Scrap 70,070 43,800

51,680,580 45,825,811Less : Provision for Obsolete Stock 3,301,692 1,993,526

48,378,888 43,832,285

SCHEDULE 06 - SUNDRY DEBTORS

(Unsecured,considered good, unlessotherwise stated)Debts OutstandingFor more than six months 9,465,119 12,217,996Less :provision for doubtful debts 4,439,513 5,025,606 4,609,999 7,607,997Others 103,479,272 67,959,969

108,504,878 75,567,966

SCHEDULE 07 - CASH & BANK BALANCES

Cash in hand 136,418 757,440Balances with Scheduled BanksIn Current Accounts 10,756,478 1,196,201In Fixed Deposit Receipts (pledged towardsbank guarantees & foreign letter ofcredits and under lien against earnestmoney deposit) 18,274,808 2,205,578In Unpaid Dividend Account 1,085,640 1,107,836

30,253,344 5,267,055

SCHEDULE 08 - OTHER CURRENT ASSETS

Pre-paid Expenses 371,274 573,304Interest Receivable 246,357 131,084Export Benefits Receivable 3,319,868 1,655,327

3,937,499 2,359,715


18th Annual Report


(Rs.) (Rs.)

SCHEDULE 09 - LOANS & ADVANCES(Unsecured-considered good unless otherwisestated)Loans to Staff 118,750 112,850Advances recoverable in cash or in kind or forvalue to be received 3,456,801 6,802,698Less : Provision for doubtful advances 203,942 3,252,859 326,102 6,476,596Advance to suppliers 1,177,920 882,098Balance with Excise Department 4,751,714 2,863,823Earnest Money Deposit 1,667,233 931,051VAT Receivable 183,075 92,143Advance Tax (Net of provisions ofRs.14,52,30,000/-, Previous yearRs. 10,78,70,000/-) 6,810,338 9,658,721

17,961,889 21,017,282

SCHEDULE 10 - CURRENT LIABILITIES AND PROVISIONSCurrent LiabilitiesSundry Creditors for Materials- Due to micro and small enterprises(Refer Note no 7 of Notes to accounts inSchedule 19) 951,378 450,936- Others 34,517,926 12,382,003Sundry Creditors for Capital Goods 1,230,438 634,420Sundry Creditors for Services 8,705,006 6,224,520Other Liabilities 8,400,871 53,805,619 7,158,926 26,850,805Advance from customers 8,043,403 6,582,019Statutory Liabilities 3,936,141 2,846,699Due to Directors 108,046 12,087,590 63,200 9,491,918Security Deposit 632,000 882,000Unpaid Dividend 1,085,639 1,107,836(There is no amount due for payment to theInvestor Protection Fund under section 205Cof the Companies Act, 1956 as at the year end.) 67,610,848 38,332,559

ProvisionsProvision for Terminal Benefits to Employees 4,027,859 3,831,545Proposed Dividend on Preference shares 540,000 540,000Tax on Proposed Dividend on Preference shares 91,773 91,773Proposed Dividend on Equity shares 10,800,225 10,800,225Tax on Proposed Dividend on Equity Shares 1,835,498 1,835,498Provision for Fringe Benefit Tax (Net of Advancetax of Rs. NIL, Previous year Rs. 5,80,000) - 47,106

17,295,355 17,146,14784,906,203 55,478,706



(Rs.) (Rs.)

SCHEDULE 11 - MISCELLANEOUSEXPENDITURE(to the extent not written off or adjusted)Share Issue ExpensesOpening Balance 43,473 177,913Less Written off during the year 43,473 - 134,440 43,473

- 43,473

Particulars Current Year Previous Year(Rs.) (Rs.) (Rs.) (Rs.)

SCHEDULE 12 - SALESSales 315,255,855 198,984,837Less : Excise Duty 11,270,187 8,702,695Net Sales 303,985,668 190,282,142Contract Packaging Revenue 224,556,182 231,807,667Less : Excise Duty 34,441,409 51,007,193Net Contract Packaging Revenue 190,114,773 180,800,474Scrap Sale 9,514,010 8,159,872Less : Excise Duty 724,272 940,000Net Scrap Sales 8,789,738 7,219,872

502,890,179 378,302,488

SCHEDULE 13 - OTHER INCOME

Interest received on deposit (TDS Rs. 32,449/-,Previous year Rs. 56,734/-) 350,466 366,623Exchange Fluctuation (Net of loss of Rs. 5,76,615/-) 462,941 -Export Benefit 1,948,767 1,008,691Liabilities Written Back 356,869 2,728,215Rent Received 36,000 36,000Profit on Sale of Fixed Assets 3,025 489,085Miscellaneous Income 294,316 124,535

3,452,384 4,753,149


18th Annual Report


SCHEDULE 14 - INCREASE / (DECREASE) IN STOCK

CLOSING STOCKFinished Goods 12,266,976 14,049,911Work in progress 6,227,714 5,857,628Scrap 70,070 18,564,760 43,800 19,951,339OPENING STOCKFinished Goods 14,049,911 18,615,485Work in progress 5,857,628 7,829,083Scrap 43,800 19,951,339 50,640 26,495,208

(1,386,579) (6,543,869)

SCHEDULE 15 - MATERIAL

Raw Material Consumed:Opening Stock 8,803,787 29,100,927Add: Purchases 124,271,857 82,897,406

133,075,644 111,998,333Less Closing Stock 13,702,493 119,373,151 8,803,787 103,194,546

Packing Material Consumed:Opening Stock 5,892,156 6,495,327Add: Purchases 50,561,235 31,683,844

56,453,391 38,179,171Less Closing Stock 8,314,274 48,139,117 5,892,156 32,287,015

Goods for Resale:Opening Stock 55,040 55,040Add Purchases - -

55,040 55,040Less Closing Stock - 55,040 55,040 -

167,567,308 135,481,561

SCHEDULE 16 - PERSONNEL

Salaries, Wages and Other benefits 63,486,449 53,492,398Contribution to Provident Fund and Other Funds 6,016,215 5,639,401Employees Welfare Expenses 2,749,936 2,453,228

72,252,600 61,585,027



SCHEDULE 17 - EXPENSESManufacturing:Stores consumed 9,593,844 7,067,543Power, fuel & water 55,771,059 44,450,699Testing fees 2,820,603 2,342,742Repairs to Plant & Machinery 7,451,573 12,558,689Excise Duty Diff: of Finished GoodsOpening & Closing Stock 229,040 (414,359)

75,866,119 66,005,314Administration:Rent 700,200 1,281,860Rates & Taxes 1,355,790 2,159,108Insurance 440,116 583,563Directors Sitting Fees 62,000 100,000Travelling and Conveyance 5,319,647 5,394,772Directors Travelling 281,231 337,418Printing and Stationery 1,372,903 1,284,196Postage & Telephone 2,147,568 1,825,981Electricity & Water charges 148,547 209,859Vehicle Running and Maintenance 1,565,031 1,557,249Auditors Remuneration 352,007 318,859Legal and Professional charges 3,509,594 3,611,020Repairs to Building 1,322,859 1,277,621Repairs to Other assets 1,784,736 1,654,137Membership & Subscription 277,760 286,247Miscellaneous expenses 1,248,915 850,517Exchange Fluctuation (Previous year,Net of gain of Rs. 14,75,004/-) - 1,131,023Loss on fixed assets 614,160 829,793Donation (Other than political parties) 465,000 12,101Bad advances written off 326,622 2,709,280Watch & Ward 782,479 863,827

24,077,165 28,278,431Selling and DistributionAdvertisement & Sales promotion expenses 3,550,729 2,804,696Freight & carriage outward 7,229,896 4,280,361Commission 2,755,603 2,497,836Registration Charges 138,550 1,165,224Sales Tax Demand (177,419) 168,838Bad Debts written off - 946,613

13,497,359 11,863,568Total Expenses 113,440,643 106,147,313

SCHEDULE 18 - FINANCIAL CHARGES

Interest on Term Loans 6,430,244 8,558,273Interest on working capital Loans 6,516,084 9,166,294Interest - others 138,283 170,323Bank Charges 3,714,843 972,993

16,799,454 18,867,883


18th Annual Report

SCEHDULE 19

Significant Accounting Policies and Notes to Accounts

1 Nature of Operations

Ahlcon Parenterals (India) Limited is the manufacturer of Pharmaceutical Intravenous Fluids and Opthalmics / Ear drops.

2 Statement of Significant Accounting Policies

(a) Basis of Accounting

i) The Accounts of the Company are prepared under the historical cost convention. For recognition of income andexpenses, accrual basis of accounting is followed except for claims not accepted / acknowledged, which are accountedfor on cash basis on account of uncertainties.

ii) Gratuity and Leave encashment liability is accounted for on accrual basis as per the Acturial Valuation determined , atthe end of accounting year.

iii) Cenvat benefit on the raw material stocks is accounted for on the basis of production plan for excisable and non -excisable products.

(b) Revenue Recognition

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenuecan be reliably measured.

Sale of Goods

Revenue is recognized when the significant risks and rewards of ownership of the goods have passed to the buyer. Itincludes excise duty but excludes sales return, volume discount and value added tax / sales tax. Excise Duty deductedfrom turnover (gross) is the amount that is included in the amount of turnover (gross) and not the entire amount of liabilitythat arose during the year.

Revenue from the sale / Contract Packaging of goods is recognised upon dispatch of goods to the customers and shownnet of sales tax and excise duty.

Export Benefit

Export Benefits constituting import duty benefits under Duty Exemption Pass Book (DEPB) are accounted for on accrualbasis.

Interest

Revenue is recognised on a time proportion basis taking into account the amount outstanding and the rate applicable.

(c) Fixed Assets

Fixed Assets have been shown at cost of acquisition, comprising of purchase price (net of rebates and discounts) levies andany other directly attributable cost and indirect expenditure for bringing the asset to its working condition for the intendeduse less accumulated depreciation

(d) Depreciation

i) Depreciation on all completed Fixed Assets is provided on the Straight Line Method in accordance with the ScheduleXIV of Companies Act, 1956.

ii) Leasehold land is amortized over the period of lease.

iii) Software costs relating to acquisition and development are capitalized in the year of purchase and amortized on a


straight-line basis over its useful life not exceeding 10 years.

(e) Borrowing Cost

Borrowing costs specifically relatable to acquisition of fixed assets are capitalized as part of the cost of fixed assets. Otherborrowing costs are charged to revenue.

(f) Inventories

Inventories are valued as follows :

Finished goods and Work in Progress : Lower of cost and net realizable value.

Scrap : Net Realisable value

Raw Material, Stores and Spare and others : Lower of cost and net realizable value. However, materials andother items held for use in the production of inventories arenot written down below cost if the finished products, in whichthey will be incorporated, are expected to be sold at or abovecost. Cost of Raw materials is determined on a monthlymoving weighted average basis and cost of stores and sparesis determined on transaction moving weighted average.

(g) Foreign Currency Transactions

The monetary items of foreign currency transactions (not covered under forward contracts) are converted into Indian Rupeesat the exchange rates prevailing on the date of Balance Sheet. The exchange difference on such conversion is adjusted inthe respective assets/liabilities and income/expenditure. Foreign currency transactions are recognized at the exchange rateprevailing at the time of transaction.

In respect of forward exchange contract entered into by the Company, the difference between the contracted rate and therate at the date of transaction is recognized as gain or loss over the period of contract. Exchange differences on suchcontracts are recognized in the statement of profit and loss in the year in which the exchange rates change. Any profit orloss arising on cancellation or renewal of forward exchange contract is recognized as income or expense for the year.

(h) Share issue expenses are amortised in 5 yearly equal installments.

(i) Current Tax is being provided as per the prevailing provisions of Income Tax Act, 1961.

(j) In accordance with AS 14 on ‘Disclosure of Revenue from Sales Transactions’ issued by Institute of Chartered Accountantsof India, excise duty on turnover has been reduced from turnover in profit & loss account.

(k) Deferred Taxation

Deferred tax resulting from timing differences between book and tax profits is accounted for under the liability method, atthe substantively enacted rate of tax on the balance sheet date, to the extent that the timing differences are expected tocrystallize / capable of reversal as deferred tax charge / benefit in the profit and loss account and as deferred tax liability /asset in the balance sheet.

(l) Impairment of assets

Consideration is given at each balance sheet date to determine whether there is any indication of the impairment / loss ofthe fixed assets. If any indication exists, an asset recoverable amount is estimated and impairment loss is recognizedwhenever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is greater of the netselling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present valueat the weighted average cost of capital.

(m) Retirement and other Employee Benefits

Gratuity liability is defined benefit obligation and is provided for on the basis of an actuarial valuation on projected unit credit


18th Annual Report

method made at the end of each financial year.

Retirement benefits in the form of Provident Fund (where contributed to the Regional PF Commissioner) is a definedcontribution scheme and the contributions are charged to the Profit and Loss Account of the year when the contributionsto the fund are due. There are no other obligations other than the contribution payable to the respective authorities.

Short term compensated absences are provided for, based on estimates. Long term compensated absences are providedfor based on actuarial valuation carried by an actuary as at the end of the year.

Actuarial gains/losses are immediately taken to Profit and Loss account and are not deferred.

3 Contingent Liabilities not provided for in respect of:-

Sl. No. Particulars Current Year Previous YearRs. Rs.

a) Excise duty pending hearing of appeals / writ petitions.i) Cenvat credit availed on raw material utilised on prorata basis 22,067,968 8,471,820ii) Cenvat credit diallowed on inputs 390,658 390,658iii) Other Miscellaneous Cases 170,586 170,586iv) Show cause notice demanding excise duty on exempted goods 33,846,670 -b) Service Taxi) Reversal of cenvat credit availed on input services 760,416 760,416ii) Demand on foreign based services 976,021 976,021c) Value Added Taxi) Declaration forms pending submission 4,740,990 78,345ii) Value Added Tax demand 10,863 175,080d) Income Taxi) demand raised during Assessment Year 2001-02 - 226,864ii) demand raised during Assessment Year 2003-04 - 104,936iii) demand raised during Assessment Year 2005-06 88,334 88,334iv) demand raised during Assessment Year 2006-07 165,707 426,141e) Letter of credit for import of raw material - 4,819,550f) Letter of credit for import of Capital Equuipment 88,062,000 -g) Bank guarantees 135,000 8,433,955

Based on favourable decisions in similar cases legal opinion taken by the Company, discussions with the solicitors etc, theCompany believes that there is fair chance of decisions in its favour in respect of all the items listed in (a) to (d) above andhence no provision is considered necessary against the same.

i National Pharmaceutical Pricing Authority (NPPA) vide its orders, letter F.No. 21 (807) 07/DW IV/ NPPA dated 03/09/2008;subsequent letter dated 24/11/2008 and in continuation letter dated 01/05/2009 have raised a demand ofRs.6,01,92,891/- being excess amount charged from consumers of product Ciplox, over and above price as per normsunder DPCO, 1995, manufactured by us on behalf of CIPLA Ltd., along with interest thereupon, amounting toRs.4,00,76,757/- (previous year Rs. 3,10,47,824/-) thereby aggregating to Rs.10,02,69,648/- (Previous yearRs. 9,12,40,715/-)

iii Capital commitments:- Capital contracts remaining to be executed (net of advances) and not provided forRs. 13,30,26,438.00, (previous year Rs. Nil).

4 In terms of Accounting Standard-10 issued by The Institute of Chartered Accountants of India and the opinion of the ExpertAdvisory Committee the company has, during the year charged to the Profit & Loss Account by debiting to stores consumedaccount, the value of spares of Rs.16,20,478/- in respect of plant & machinery which has already been fully depreciated i.e


its useful life has already been over. These spares have been carried in the inventory from previous years and are now shownin inventory at zero value.

5 The company has advanced a sum of Rs. 35,95,182/- in foreign currency towards registration of its products in variouscountries in earlier years. This amount has been wirtten off in the absence of any confirmation from registering authoritiesabout the final outcome of our application. The same has been charged under the head prior period adjustment.

6 A sum of Rs.25,00,000/- towards purchase / installation of ERP System in the company to M/s MGRM Infotech SolutionsPvt Ltd was written off during F.Y 2008-09 as non-recoverable due to incomplete status of the job and non submission ofbills thereof. However in the current year the ERP system has been installed and implemented as such the amount writtenoff has been recalled and adjusted as intangible assets. The amount recalled has been credited to profit and loss accountunder the head prior period adjustment.

7 Amount due to suppliers covered under Micro,Small and Medium Enterprises Act 2006, on the basis of confirmaton receivedis as under:

Sl. No. Description Current Year Previous Year(Rs.) (Rs.)

I) The principal amount and the interest due thereon remaining unpaid to anysupplier as at the end of year -

Principal Amount Unpaid 91,378 450,936

Interest Due 32,725 102,937

II) The amount of interest paid by the buyer in terms of section 16, of theMicro, Small and Medium Enterprise Development Act, 2006 along withthe amounts of the payment made to the supplier beyond the appointedday during the year. - -

Payment made beyond the Appointed Date 2,544,029 2,508,783

Interest Paid beyond the Appointed Date - -

III) The amount of interest due and payable for the period of delay in makingpayment (which have been paid but beyond the appointed day during theyear) but without adding the interest specified under Micro Small andMedium Enterprise Development Act, 2006. 63,407 43,975

IV) The amount of interest accrued and remaining unpaid at the end of theyear; and 96,132 112,239

V) The amount of further interest remaining due and payable even in thesucceeding years, until such date when the interest dues as above areactually paid to the small enterprise for the purpose of disallowance as adeductible expenditure under section 23 of the Micro Small and MediumEnterprise Development Act, 2006 121,541 9,302

8 Secured Loans

a) Working capital facility / Term loans from Punjab & Sind Bank are secured by way of first and exclusive charge on all thecurrent assets of the company and the specific machinery purchased against the term loans and on other Fixed Assetsincluding hypothecation and mortgage on land & building of the company, both existing and future. The said loan is furthersecured by the personal guarantee of the chairman and two directors in their personal capacity.

b) Term loans (vehicles) are secured by hypothecation of specified assets.

c) Secured Term loan repayment due in the next 12 months Rs.1,17,84,806/- (Previous year Rs. 1,12,93,500).


18th Annual Report

9 The 6% Redeemable Cumulative Preference Shares redeemable during the year on excercising option by the Company /shareholders have not been redeemed as none has excercised the option during the year.

10 Gratuity and other post-employment benefit plans:

The Company has a defined benefit gratuity plan. Gratuity is computed as 15 days salary, for every completed year ofservice or part thereof in excess of 6 months and is payable on retirement/termination/resignation. The benefit vests on theemployees after completion of 5 years of service. The Gratuity liability has been funded. Company makes provision of suchgratuity liability in the books of accounts on the basis of actuarial valuation as per the Projected unit credit method.

The Company has also provided long term compensated absences which are unfunded.

The following tables summarise the components of net benefit expense recognized in the profit and loss account and theunfunded status and amounts recognized in the balance sheet for the Gratuity.

Profit and Loss Account

Net employee benefit expense (recognised in Employee Cost)(Amount in Rupees)

Gratuity 31-Mar-2010 31-Mar-2009

Current service cost 931,938 826,150Interest cost on benefit obligation 412,013 339,332Expected return on plan assets (398,407) (190,274)Net actuarial loss / (gain) recognised in the year 296,084 583,395Past service cost 185,038 -Net benefit expense 1,426,666 1,558,603Actual return on plan assets 475,226 346,999

31-Mar-2010 31-Mar-2009

Defined benefit obligation 7,464,833 5,885,903Fair value of plan assets 5,642,161 4,426,759Less: Unrecognised past service cost - -Plan liability (1,822,672) (1,459,144)

Balance sheet

Details of provision for Gratuity(Amount in Rupees)

Changes in the present value of the defined benefit obligation are as follows:(Amount in Rupees)

31-Mar-2010 31-Mar-2009

Defined benefit obligation as at April 1 (Opening Balance) 5,885,903 4,241,647Interest cost 412,013 339,332Past service cost 185,038 -Current service cost 931,938 826,150Benefits paid (322,962) (261,346)Actuarial losses on obligation 372,903 740,120Defined benefit obligation as at March 31 (Closing Balance) 7,464,833 5,885,903


The principal assumptions used in determining gratuity benefit obligations for the Company’s plans for last three years areshown below:

31-Mar-2010 31-Mar-2009

Discount rate 7.70% 7.00%Increase in Compensation cost 5.50% 5.50%Rate of Return on Plan Assets 9.15% 9.00%

The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion andother relevant factors, such as supply and demand in the employment market.

Amount for the current and previous two years are as follows:

Gratuity

31-Mar-2010 31-Mar-2009 31-Mar-2008

Defined benefit obligation 7,464,833 5,885,903 4,241,647Plan Assets 5,642,161 4,426,759 2,187,058Deficit (1,822,672) (1,459,144) (2,054,589)Experience adjustments on plan liabilities (Loss)/ Gain 194,364 529,296 -Experience adjustments on plan assets (Loss)/ Gain 76,819 156,725 -

Particulars Current Year Previous YearRs. Rs.

Provident Fund 3,876,857 3,334,900

Contribution to Defined Contribution Plans:

11 In the opinion of the Management and to the best of their knowledge and belief, the value of current assets, loans andadvances if realized in the ordinary course of business would not be less than the amount at which they are stated in theBalance Sheet.

12 i. Auditor’s Remuneration


a) For Statutory Audit 181,995 181,995b) For Tax Audit 82,725 82,725c) Certification and other matters 143,390 68,986d) Out of pocket expense 19,844 16,053

Total 427,954 349,759

Note : * Including Service tax Rs. 31,827 /- (previous year: Rs. 30,900/-) claimed / set off as cenvat credit.

ii. Director’s Remuneration


a) Salaries and allowances 1,680,000 1,628,200b) Contribution to Provident Fund 201,600 195,384c) Perquisites 24,692 143,972

Total 1,906,292 1,967,556

Note: Wholetime Director is covered under the Company’s gratuity scheme along with the other employees of the Company.


18th Annual Report

The gratuity liability is determined for all the employees on overall basis by an independent actuarial valuation. The specificamount of gratuity for Whole Time Director cannot be ascertained separately and accordingly the same has not beenincluded in the above note.

13 a) Excise duty on sales amounting to Rs 4,64,35,868/- (previous year Rs 6,06,49,888/-) has been reduced from sales inProfit & Loss Account.

b) Excise duty differential of Rs.2,29,040/- on decrease in stock in the current year and of Rs.4,14,359/- on increase in stockin the previous year, has been shown under the manufacturing expense in Schedue 17.

14 Calculation of Deferred Tax (Assets) / Liability is as follows:

A Deferred Liability


Difference between the book value on depreciableAssets and as per Income Tax Act 153,534,791 149,294,893Total Deferred Liability 153,534,791 149,294,893Total Deferred Tax Liability 52,186,476 50,745,334

B Deferred Assets


Provision for leave encashment 2,601,193 2,372,401Provision for Doubtful Debts 4,439,513 4,609,999Provision for Doubtful Advances 203,942 326,102Provision for Gratuity 1,426,666 330,902Provision for Bonus 2,415,806 2,320,084Provision for Obsolete Inventory 3,301,692 1,993,526Total Deferred Assets 14,388,812 11,953,014Total Deferred Tax Assets 4,890,757 4,062,829Net Deferred Tax Liability (A-B) 47,295,718 46,682,505Net Deferred Tax (Assets) / Liability provided for the year 613,214 706,513

15 Lease

The Company has taken various residential and office premises under operating lease agreements. These are generally notnon-cancelable and are renewable by mutual consent on mutually agreed terms. There are no restrictions imposed byLease Agreement. There are no subleases.

Lease Payments


Total lease payment for the year (Recognised in Profit & Loss Account) 700,200 1,281,860Minimum Lease PaymentNot later than one year 540,000 630,000Later than one year but not later than five years 202,500 1,800,000Later than five years - -


16 Related Party disclosures

a. List of Related Parties (As ascertained by the management)

1 Enterprises under common control

Ahluwalia Contracts (India) Ltd.

Ahluwalia Builders Development Group (P) Ltd.

Tidal Securities Pvt. Ltd.

Capricon Industrials Ltd.

Ahlcons India (P) Ltd.

Ahlcon Ready Mix Concrete Pvt. Ltd.

Dipesh Mining Pvt Ltd.

Jiwanjyoti Traders Pvt Ltd.

Paramount Dealcomm Pvt, Ltd.

Prem Sagar Merchants Pvt Ltd.

Splendor Distributors Pvt. Ltd.

Enterprises over which key managerial personal is able to exercise significant influence.

Shantidevi Progressive Educational Society

Karamchand Ahluwalia Charitable Hospital

2 Individuals owning, directly or indirectly a substantial Interest in the voting power of the Company

Mrs. Sudarshan Walia Director

(Also relative of Key Management Personnel)

3 Key Management Personnel

Mr. Bikramjit Ahluwalia Chairman

Dr. Rohini Ahluwalia Vice Chairperson & Whole Time Director (also relative of Keymanagement personnel)

4 Relative of the key management personnel with whom the transactions have taken place during the year

Mrs. Mukta Ahluwalia Daughter of Chairman

5 Non Executive Directors

Mrs. Sudarshan Walia

Mr. Arun Kumar Gupta

Dr.. S.S.Arora

Prof. G.P.Talwar

Dr. S.C.L Gupta

Mr. S K. Sachdeva


18th Annual Report

b. Transactions with related parties


i) Rent Paid to- Companies under common control 270,000 302,908- Daughter of Chairman 360,000 360,000

ii) Managerial Remuneration- Key Management Personnel 1,906,292 1,967,556

iii) Payment of DonationEnterprises over which key managerial personal is able to exercisesignificant influence. 450,000 -

iv) Payment of Deferred Payment Liability- Companies under common control - 22,410,000

v) Payment Against Current Liabilities- Companies under common control - 3,402,479

c. Amount Due from / to related parties


i) Included in Current Liabilities- Due to key management personnel 108,046 63,200

ii) - Companies under common control 60,750 -

Note: No amount has been written off provided for in respect of transaction with related parties.

17 Earnings per share:


a) Net profit after tax 71,587,294 22,616,008Less : Preference Share Dividend 540,000 540,000Tax on Preference Share Dividend 91,773 91,773

b) Net profit available for equity shareholders 70,955,521 21,984,235c) Weighted average number of equity shares outstanding during the year 7,200,150 7,200,150d) Basic earning (in Rupees) per share of Rs. 10/- each 9.85 3.05e) Diluted earning (in Rupees) per share of Rs. 10/- each 9.85 3.05

18 Segment Reporting:

The Company is operating in one segment, i.e. Pharmaceuticals only, and hence the segment reporting as defined by AS17 (Segmental Reporting), issued by ICAI. is not applicable.


Particulars Current Year Previous Year

Amount in Foreign Amount (Rs.) Amount in Foreign Amount (Rs.)Currency Currency

Import Creditors USD 143,550 6,505,686 USD - -Export Debtors USD 150,727 6,763,104 USD 36,366 1,814,390Advance Given USD 100,000 4,489,000 USD 86,296 3,595,182Advance Received USD 32,972 1,494,719 USD 10,976 556,388

20 Additional information required under Part II of Schedule VI of the Companies Act, 1956, (To the extent applicable to theCompany and as certified by the Management).a Details of Licensed Capacity, Installed Capacity & Production.

(Nos. in Lacs)

Description Licenced Installed ActualCapacity Capacity Production

I.V. Fluids Current Year 420 320 * 289.28Previous Year 420 320 206.06

Injectable Current Year N.A 1440 ** 724.20Previous Year N.A 1440 659.69

* Includes 108.18 lac bottles (previous year 95.07 lac bottles) on job basis.** Includes 493.20 lac vials (Previous Year 475.85 lac vials) on job basis.

b Material Consumed

Description Current Year Previous Year

M.T Rs. M.T Rs.

Raw Materials Consumed:PE Granules # 1,271.394 75,256,692 # 969.836 75,158,533Dextrose 347.179 12,868,754 274.478 10,780,375Chemicals - 31,247,708 - 17,255,639Packing Material Consumed - 48,139,117 - 32,287,015

167,512,271 135,481,562

# includes consumption on 601.38 lac bottles (*previous year 570.92 lac bottles) produced on job basis.

c Stock and Turnover (as certified by the Management)

Stocks

Description Opening Stock Closing Stock

Nos Rs. Nos Rs.

I.V Fluids & Injectables (Nos) 2,902,412 14,049,911 2,699,280 # 12,337,046(3,279,321) (18,615,485) (2,902,412) (14,049,911)

Goods for resale @ 16,000 55,040 @ - -(16,000) (55,040) (16,000) (55,040)

TOTAL 2,918,412 14,104,951 2,699,280 12,337,046(3,295,321) (18,670,525) (2,918,412) (14,104,951)

# excludes Rs. 70,070/- of scrap stock , (Previous Year Rs.43,800/-)@ Destroyed during the year (Previous year Nil)

19 Derivative Instruments and Unhedged Foreign Currency ExposureParticulars of unhedged foreign currency exposure as at Balance Sheet date:


18th Annual Report

Description Purchases Sales

Nos Rs. Nos Rs.

I.V Fluids & Injectables - - $ 102,125,197 # 494,100,441(Including Contract packaging) - - (89,903,749) (371,082,616)

Turnover

# excludes scrap of Rs 87,89 ,738 /- sold (Previous year Rs.72,19,872/-)$ excluding 35,381 nos (Previous Year 17,756 nos.) of samples given and also excluding Nil destroyed (Previous Year Nilnos.)

Description Current Year Previous YearRs. Rs.

d Expenditure in Foreign Currency (Payment basis)Bank Charges 194,817 112,065Professional Charges - 613,708Business Promotion 237,889 -Registration Fee / Advance for registration 133,550 452,993

e Remittance in foreign currency on account of dividendNumber of non -resident shareholder 21 24Number of shares held 10,809 11,803Amount of dividend 16,214 17,705

f Earning in Foreign Currency:FOB Value of Exports 46,661,464 26,749,406

g Value of Imports calculated on CIF basis:Raw materials 56,456,979 41,850,969Stores & Spares 1,000,920 1,627,468Capital Goods 2,977,500 -

h Value of Materials, Stores & spares Consumed:

Description Current Year Previous Year

Value % Value %

MaterialsImported 59,476,564 35.51 75,158,533 55.48Indigenous 108,035,707 64.49 60,323,028 44.52

167,512,271 100.00 135,481,561 100.00Stores & SparesImported 2,078,311 12.74 7,071,781 39.26Indigenous 14,238,827 87.26 10,940,598 60.74

16,317,138 100.00 18,012,379 100.00

21 Previous year figures have been regrouped and / or rearranged wherever considered necessary.As per our report of even dateFor Arun K. Gupta & AssociatesChartered AccountantsFirm Registration No : 000605N




CASH FLOW STATEMENT for the year ended 31st March 2010

Particulars Current Year Previous Year(Rs.) (Rs.)

A Cash Flow from Operating ActivitiesNet Profit / (Loss) before tax & interest 123,896,984 52,224,286Adjustment for :Depreciation 21,954,439 22,290,723Interest Inflow (350,466) (366,623)Miscellaneous Expenditure Written Off 43,473 134,440Bad Advances Written off 326,622 2,709,280Profit on sale of Fixed Assets (3,025) (489,085)Loss on fixed assets under disposal 614,160 829,793Provision for Doubtful Debts / Advances 203,942 1,806,887Provision for Obsolete Stock 1,390,016 1,394,832Provision for Doubtful Debts Writtten Back (170,486) (1,375,519)Provision forDoubtful AdvancesWritttenBack (326,102) (230,072)Provision for Obsolete Stock Writtten Back (81,850) (1,001,230)Operating Profit / (Loss) before WorkingCapital changes 147,497,707 77,927,712Adjustment for:Trade Receivable & Others (33,886,573) 7,336,289Trade Payable and Others 29,474,603 (30,818,252)Inventory (6,018,469) 35,743,513Cash generated from operations 137,067,268 90,189,262Interest Paid (13,084,611) (17,894,890)Direct Taxes Paid (35,788,433) (14,296,929)Net Cash from Operating Activities (A): 88,194,224 57,997,443

B Cash Flow from Investing ActivitiesPurchase of Fixed Assets (20,995,321) (3,150,017)Sale / Adjustment of Fixed Assets 550,258 600,000Interest Received 350,466 366,623Net Cash from Investing Activities (B): (20,094,597) (2,183,394)

C Cash Flow from Financing ActivitiesLong Term Loans repaid (10,900,724) (13,146,750)Short Term Loans (18,945,118) (15,056,704)Dividend and taxes on dividend paid (13,267,496) (13,267,496)Interest accrued & Due - (25,363)Deferred Payment Liability - (22,410,000)Net Cash from Financing Activities (C): (43,113,338) (63,906,313)Net Increase/(Decrease) in Cash & Equivalent (A+B+C) 24,986,289 (8,092,264)Cash & Cash Equivalents as at 1st April (Opening Balance) 5,267,055 13,359,319Cash & Cash Equivalents as at 31st March (Closing Balance) 30,253,344 5,267,055





18th Annual Report

BALANCE SHEET ABSTRACT AND COMPANY’S GENERALBUSINESS PROFILE

(i) Registration Details

Registration No.: 47245 : 55

Balance Sheet Date : 31-03-2010

(ii) Capital raised during the year : Nil

(iii) Position of mobilisation and deployment of Funds

(Amount in Rs. Thousands)

Total Liabilities 499,030 Total Assets 499,030

Sources of Funds

Paid up Capital 72,002 Secured Loans 100,431

Paid up preference share capital 9,000

Reserves & Surplus 270,301 Deferred Tax Liability 47,296

Unsecured Loans -

Application of Funds

Net Fixed Assets 374,900

Net Current Assets 124,130

(iv) Performance of Company

Turnover including other income 506,342 Total Expenditure 395,530

Profit /(Loss) before Tax 110,812 Profit/(Loss) after Tax 71,587

Earning/(Loss) per share in Rs. 9.85 Dividend rate 15%

(v) Generic names of principal products/services of Company (as per monetary terms)Product Description Item Code No.

1 Large Volume Parenterals 300320

2 Small Volume Parenterals 300320

As per our report of even date

For Arun K. Gupta & Associates

Chartered Accountants

Firm Registration No : 000605N

Sachin Kumar Bikramjit Ahluwalia Dr. Rohini Ahluwalia

Partner Chairman Vice Chairperson, (CEO)

M. No: 503204

Rajeev Kumar Walia Ranjan Kumar Sahu

Place : New Delhi Chief Financial Officer Company Secretary

Date : 29-05-2010

Ahlcon Parenterals (India) LimitedRegd. Office: 4, Community Center, Saket, New Delhi - 110017

ATTENDANCE SLIP

18th Annual General Meeting - Friday, 17th September, 2010

DP ID............................................................................... REGD FOLIO NO. ...............................................................................

CLIENT ID....................................................................... NO. OF SHARES HELD.........................................................................

I certify that I am a member / proxy for the member of the company.

I record my presence at the 18th Annual General Meeting of the Company to be held at Ahlcon Public School, Mayur Vihar,

Phase-I, New Delhi-110091, at 3.00 P.M. on Friday, the 17th day of September, 2010

----------------------------------------- ------------------------------------Name of the member/ proxy Signature of member/ proxy(In BLOCK letters)

Please ( ) in the box Member Proxy

Note: Please fill up this attendance slip and hand over at the entrance of the meeting hall.Members are requested to bring their copies of the annual report to the meeting.

............................................................................................. please tear here ........................................................................................

Ahlcon Parenterals (India) LimitedRegd. Office: 4, Community Center, Saket , New Delhi - 110017

PROXY FORM

DP ID............................................................................... REGD FOLIO NO. ...............................................................................

CLIENT ID....................................................................... NO. OF SHARES HELD.........................................................................

I/we ........................................................... of .............................................................. in the district of ...................................................

being a member / members of the Company, hereby appoint Shri/ Smt............................................................... of

.................................................................. in the district of ..................................................................... or failing him /her

.................................................................. of ............................................................................................... in the district of

.............................................................. as my / our proxy to vote for me / us on my / our behalf at the 18th Annual General

Meeting of the Company to be held on Friday, the 17th day of September, 2010 and at any adjournment (s) thereof.

Signed this --------------------------------- day of .....................2010.

Signature..........................................

Notes: This form, in order to be effective, should be duly stamped, completed, signed and deposited at the RegisteredOffice of the Company, not less than 48 hours before the meeting.

Affix Rs.1

Revenue

Stamp

Note: Annual Listing Fee for the year 2010-2011 has been paid to all the Stock Exchanges

STOCK EXCHANGES

(Where the Company's equity shares are listed)

1. Delhi Stock Exchange Ltd

DSE House, 3/1, Asaf Ali Road, New Delhi-110002

2. Bombay Stock Exchange Ltd thP J Towers, 25 Floor, Dalal Street, Mumbai-400001

3. Jaipur Stock Exchange Ltd

Jawaharlal Nehru Marg, Malviya Nagar, Jaipur-302017

4. The Calcutta Stock Exchange Association Ltd

Calcutta Stock Exchange Building 7, Lyons Range, Calcutta -700001

REGISTRAR & SHARE TRANSFER AGENTS MAS SERVICES LTD

T-34, 2nd Floor, Okhla Industrial Area,

Phase - II, New Delhi - 110 020

Ph:- 011-26387281/82/83,

Fax:-011- 26387384,

email:- [email protected]

Website: www.masserv.com

For Dematerialisation of Shares

ISIN No. INE 027C01011

Ahlcon Parenterals (India) Limited4, Community Centre, Saket, New Delhi - 110017

Telefax No. 91-11-26852036

Email : [email protected]

www.ahlconindia.com

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