PCI CHEMICALS AND PHARMACEUTICALS LIMITED
Your Directors have pleasure in presenting the Twentieth Annual Report of
the company together with Audited Statement of Accounts for the year ended
31 st March,1998.
During the year under consideration there has been slight increase in the
operation of the company. The sales and other income registered during the
year was Rs.2261.24 Lacs as against previous year total of Rs.2188.35 Lacs
which represented an increase of 3.20 %.
The operating Profit for the year amounted to Rs.32.49 Lacs as compared to
Rs. 65.78 Lacs for the previous year which represented a decrease of
The profitability constrained during the year mainly due to increase in
cost of production and overhead expenses as also other factors responsible
for decline are general recessionary trend prevailing in the Indian
economy, heavy competition, liquidity crunch, unstable finance market, high
cost of finance etc. Your Directors have already taken effective steps to
boost the sales and profitability of the company and expect better results
in current financial year.
In view of the inadequacy of profit Your Directors expressed their
inabilities to recommend any dividend for the Financial Year 1997-98.
REDEMPTION OF 20,000 REDEEMABLE CUMULATIVE PREFERENCE SHARES
During the year company has started redemption of 20,000 14% Redeemable
Cumulative Preference Shares of Rs. 100/- each at par and so far company
has repaid 9,86,000/-to the Preference Shareholders who has submitted duly
discharged Preference Share Certificates to the company.
Your company has planned to launch two promising new generation molecules
showing good future potential & growth. These products are growing at more
than 1005in the market.
The proposed new products to be launched are Azimycin and Sulindol. The
Azithromycin (Azimyci) is a once a day new macrolide and Nimesulide
(Sulindol) is a new Anti-inflammatory,analgesic and Anti-pyretic. The new
products have good gross margins and are going to be a part large growing
The Anti-malarial season did not go to peak this year which resulted into
erosion of demands for the company's Anti-malarial product range, however
the concept of malaquin 1000 has been meeting with increased acceptance
from the market.
NEW BULK DRUG PROJECT
Your Directors decided to stalled the Bulk-Drug Project due to abysmal
demand and severe competition from the China and other South East Asia
The company's manufacturing sales was less than Rs. 10 Crores during the
year and the company being a SSI is eligible for exemption from the
compulsory cost audit.
PROJECTIONS V/S ACTUALS
The profitability projections for the 1997-98 as per the Prospectus dated
08.12.94 and the actuals against the same compared below:
Net Sales (Rs in Lacs) 6060.25 2259.89
Net Profit (Rs in Lacs) 283.00 4.59
Earning per Share (Rs.) 9.43 0.81
The projected Sales/Profitability differed with the actual sales &
profitability achieved in the year 1997-98 due to stalling of Bulk Drug
Project at G.l.D.C Ankleshwar as stated in the Prospectus dated 08-12-94.
The Board of Directors are planning to enlarge the product range of
existing formulation unit as proceeding with Bulk Drug project will be a
very risky proposition at this juncture.
Mr.K.M.Shah, Mr.M.C.Patel and Mr.J.C.Patel retire by rotation at the
ensuing Annual General Meeting and being eligible offer themselves for re-
AUDITORS AND THEIR REPORT:
M/S Balsekar & Desai, Chartered Accountants, Mumbai ,the retiring Auditors
of the company, retire at the ensuing Annual General Meeting and being
eligible offer themselves for re- appointment.The members are requested to
appoint the Auditors . The specific notes forming part of the Accounts
referred to in the Auditors' Report are self-explanatory and do not require
any further elucidation.
The Report of the Directors of P.C.I. Organics Pvt. Ltd., an erstwhile
subsidiary of the company and the statement of accounts of the said company
for the year ended 30th June, 1998 together with the Auditors Report
thereon have not been attached as the said company is no more a Subsidiary
of the company
The company has not invited any deposits from public during the year 1997-
PARTICULARS REGARDING CONSERVATION OF ENERGY,ETC
The information in accordance with the Provisions of section 217 (1) (e) of
the companies Act, 1956 read with the Companies (Disclosure of Particulars
in the Report of Board of Directors Rules.1988 regarding Conservation of
Energy, Technology Absorption and Foreign Exchange Earnings and Outgo is
given in the statement annexed 'A' & 'B' hereto forming cart of the Report.
PARTICULARS OF EMPLOYEES:
The information required U/5.2172A) of the Companies Act,1956, read with
the Companies Particulars of Employees) Rules,1975 have not been given as
nc employee has drawn salary stipulated in the said Section during
Financial Year 1997-98.
The industrial relations continued to be cordial and friendly.
The assets of the company have been adequately insured.
Your Directors wish to place on record their grateful appreciation for the
devoted services of the workers, staff and officers who have largely
contributed to the efficient Management of the Company.
The Directors gratefully acknowledge continuing support received from the
shareholders,Bankers, Financial Institution and Govt. Departments Your
Directors also thank medical profession traders and consumers for their
patronage of the company's products.
ON BEHALF OF THE BOARD OF DIRECTORS
(Chairman & Whole-time Director)
Place : Mumbai.
Dated : 30th September,1998
ANNEXURE TO DIRECTORS' REPORT
DISCLOSURE OF PARTICULARS WITH RESPECT TO RESEARCH AND DEVELOPMENT
1. RESEARCH AND DEVELOPMENT
1. The specific areas in which R & D carried
out by the Company:
- New product Development
- product Improvement
- Process Development
The Company conducts its Research & Development at its Plant at
2. Benefits Derived as a result of the above R & D:
The Research and Development efforts resulted in Development of new
3. Future Plan of Action:
The Company will continue to lay emphasis on the main areas of R & D
mentioned in paragraph 1 above.
Current Year Previous Year.
4. The Expenditure of R D
a. Capital - -
b. Recurring - 48,000
c. Total - 48,000
d. Total Research Expenditure as - 0,022
percentage of total turnover
Il.TECHNOLOGY ABSORPTION, ADAPTATION & INNOVATION
1 Efforts in brief made towards technology
absorption, adaptation and innovation Not Applicable
2. The benefits derived as result of the above efforts. Not Applicable
3 imported Technology Not Applicable
Ill.FOREIGN EXCHANGE EARNINGS AND OUTGO
The details of foreign exchange earning and outgo are given in Notes to