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Hiran Orgochem Ltd.

BSE: 506170 Sector: Health care
NSE: N.A. ISIN Code: INE546E01016
BSE 05:30 | 01 Jan Hiran Orgochem Ltd
NSE 05:30 | 01 Jan Hiran Orgochem Ltd

Hiran Orgochem Ltd. (HIRANORGOCHEM) - Chairman Speech

Company chairman speech

HIRAN ORGOCHEM LIMITED ANNUAL REPORT 2009-2010 CHAIRMAN'S REPORT Dear Shareholders, 2009-10 was a transformational year for your Company. We moved decisively to strengthen and expand our core businesses. We made excellent progress generating solid financial results, advancing our product development pipeline and strengthening our market presence. For the year ended March 31, 2010, your Company's revenues increased marginally to Rs 2150 mn, a growth of 17% over the previous year. However there has been a robust increase in our bottomline. From a loss of Rs 174 mn in the previous fiscal we have reported a profit of Rs 74 mn. The principal reason for this turnaround has been our ability to operate at more than 100% capacity. It's our goal at Hiran to position the Company for accelerated growth in revenues and earnings. INDUSTRY DEVELOPMENTS: The global generic industry is expected to grow at a faster pace at CAGR of 9% over FY 08-13 as compared to the overall pharmaceutical market which is slated to grow at a CAGR of 2-3% over FY 08-13. Currently valued at USD 87 bn, the global generic market is expected to touch USD 135 bn by 2013. Factors triggering this growth include drugs worth USD 235 bn going off patent over FY 10-15, tripling of elderly population (60+ population -700 mn in 2005 would reach 1900 mn by 2050), spiraling health care expenses across the globe and favourable government policies. This was the broad overview about the industry that your Company operates in and now let me give you macro picture about the operations of your Company. MANUFACTURING: The biggest highlight for the year under review is establishing a new entity Act Gen Pharma Pvt. Ltd. in collaboration with Procycon Lifescienes Pvt. Ltd. With this newly formed entity our combined manufacturing capacity stands at nearly 2000 MT p.a. Involving a capex of Rs 300 mn and a 49% stake this newly formed entity your Company is equipped to cater to the increasing demand for its products and mark its foray into the high margin regulated markets after receiving the US FDA approval. Further, your Company is not only looking to expand but is also taking steps to maxmise operational efficiencies due to which our capacities were operational at more than 100% in the year under review. RESEARCH AND DEVELOPMENT: Research and development is a powerful engine which serves as a tool to enrich your Company's product pipeline, enter the developed markets and to fortify its position as a fast-growing pharmaceutical company. Hiran views its R&D capabilities as a vital component of the business strategy which will provide it with a sustainable, long-term competitive advantage. QUALITY: Quality being the supreme objective, your Company continuously keeps abreast of the latest information and technological developments both in India and abroad. Your Company has evolved a quality policy, and this has helped us grow manifolds in this business since our inception. Further, we also ensure our manufacturing capacities incorporate best practices and adhere to stringent regulatory compliances and quality norms. REAL ESTATE INVESTMENT: To garner attractive returns your Company had made an investment in the fast growing real estate sector in the year 2006-07. Your Company has acquired land in Coimbatore and has plans to develop an integrated township which would be developed in 3 phases. A BRIGHT FUTURE AHEAD: Clearly, we believe that we are entering an exciting new phase of development. We will continue to make the necessary investments in R&D to pursue our long term strategy of expanding our product portfolio and strengthening our market presence. We also plan to raise Rs 500 mn through a GDR issue in the next fiscal which would be employed for capital expenditure, meeting long term working capital requirements and setting up offices overseas. Our strong financial foundation, a very promising pipeline of products and unique technology platforms will be the key factor driving growth. ON A PARTING NOTE: We have an excellent team of employee's committed to achieving the Company's goals in the coming years. I look forward to reporting on our progress towards those goals in months and years ahead. Sincerely, Kantilal Hiran Chairman and Managing Director