1. Estimated amount of contracts remaining to be executed on capital
 accounts and not provided for as on 31st March 2002 - Rs. 15,65,573
 (2001 - Rs. 1,90,49,209).
 
 2. Contingent liabilities not provided for in respect of:
 
 A. Guarantees issued by Companys Bankers - Rs. 12,19,103 (2001 - Rs.
 3,95,700).
 
 B. Commitment for Letters of Credit - Rs. 1,40,15,065 (2001 - Rs.
 2,18,01,510).
 
 C. I. Claims against the Company not acknowledged as debts - Rs.
 11,57,398 (2001 - Rs. 49,65,760).
 
 II. Income-tax matters under appeal - Rs. 1,35,199 (2001 - Rs. NIL).
 
 D. Based on the judgement of Honourable High Court of Andhra Pradesh on
 seignorage fees amounting to Rs. 37,53,548 imposed by the Department of
 Mines and Minerals, Government of Andhra Pradesh, liability, if any, on
 account of the above is not ascertainable at this stage.
 
 E. Dividend in arrears on 12% Cumulative Redeemable Preference Shares
 Rs. 1/20,00,000 (2001 - Rs. 60,00, 000).
 
 3. Future obligations in respect of assets taken on finance lease
 
                        As at 31st March 2002      As at 31st March 2001
                                        (Rs.)                      (Rs.)
 
 - Not later than one year          25 42 800                  21 63 900
 
 - Later than one year & not
 later than 5 years               3 01 10 100                 21 400 800
 
 - Later than 5 years             6 88 67 400                 80 119 500
 
                                   101520300   103684200
 
 Net present value of Lease Rentals payable is Rs. 1 39 47 443 (2001 -
 Rs. 1 41 39 614)
 
 The Company has entered into various other operating lease agreements
 and the amounts paid under such agreements have been charged to
 revenue. These agreements are cancelable lease agreements.
 
 4. Secured Loans
 
 A) Term Loans
 
 All long term loans from Financial Institutions namely ICICI Bank
 Limited, IIBI Ltd., Exim Bank and Technology Development Board (TDB)
 are secured against a first charge by way of equitable mortgage on
 deposit of title deeds of the Companys immovable properties situated
 at Pashamylaram Village, Medak District, Andhra Pradesh and
 hypothecation of Companys movable properties (except Book debts), both
 present and future, wherever situated, ranking pari-passu interse
 subject to prior charges created/to be created on specified current
 assets in favour of Companys bankers to secure the borrowings for
 working capital.
 
 B) Working Capital Loans
 
 All the working capital loans from banks are secured against a first
 charge by way of hypothecation of raw materials, works-in-progress,
 finished goods, stores and spares, book debts and a second charge on
 its movable and immovable properties.
 
 All term loans and working capital loans have been further guaranteed
 by the managing director and two other directors of the Company in
 their personal capacity.
 
 5. Unsecured Loans
 
 Interest has not been provided on unsecured loans received from others
 (shown as other than short term on Schedule 4) in terms of the
 agreement entered into with financial institutions for project finance.
 
 6. Small Scale Industrial Undertakings (S. S. I.)
 
 S. S. I. units to whom the amount is outstanding for more than thirty
 days as on 31st March 2002 are given below:
 
 Amar Industrial and Fine Chemicals
 
 Asim Pharmachem Industries
 
 Deedy Chemicals Private Limited
 
 Gujarat Mital Petro Pharma Private Limited
 
 Pioneer Laboratories Private Limited
 
 7. During the year, certain furniture, fixtures and office equipment
 were damaged by an incident of fire at the Corporate Office of the
 Company. The written down value of such assets amounts to Rs.
 35,87,170. The Company has filed an insurance claim against loss of
 such assets and received a sum of Rs. 7,69,600 towards the on account
 payment (included under Other liabilities in Schedule 10). Pending
 settlement of the claim by the insurance Company, no provision for any
 loss has been made in the accounts. In the opinion of the management,
 the insurance claim receivable will not be less than the net carrying
 value of such assets.
 
 8. Pre-operative expenses pending allocation
 
 Description                                Year ended        Year ended
                                       31st March 2002   31st March 2001
                                                 (Rs.)             (Rs.)
 
 Opening balance                            790 75 522        413 03 045
 
 Add: Additions during the year
 
 Salaries                                    77 15 877         38 79 581
 
 Travelling Expenses                          8 24 016         35 53 169
 
 Consultancy Fees                            11 69 404         88 63 940
 
 Interest and Finance Charges               118 51 584        123 39 402
 
 Consumables                                  2 08 784             9 879
 
 Pre-clinical Study                                  -         60 68 519
 
 Description                                Year ended        Year ended
                                       31st March 2002   31st March 2001
                                                 (Rs.)             (Rs.)
 
 Insurance                                      73 017          2 79 162
 
 Fee for increase in authorised share capital        -          9 49 000
 
 Utilities                                           -          7 07 592
 
 Special Training Cost                               -          3 76 184
 
 Purchase of Chemicals                        1 18 657          1 06 858
 
 Pilot Plant Trial Charges                   36 52 185          6 39 191
 
 Less: Capitalised during the year          747 17 038
 
 Less: Transferred to Product development
 expenses                                    68 37 345                 -
 
 Balance                                    231 34 663        790 75 522
 
 9. In the opinion of Board of Directors, sundry debtors, current
 assets and Loans and advances have a value on realisation in the
 ordinary course of business, at least equal to the amount at which they
 are stated.
 
 10. Pursuant to the adoption of the Accounting Standard 22 Accounting
 for Taxes on Income issued by the Institute of Chartered Accountants
 of India with effect from 1st April 2001 deferred tax assets amounting
 to Rs. 1 26 42 815 as computed after considering the timing differences
 as on 1st April 2001 has been adjusted in the carried forward balance
 in the Profit and Loss Account. Deferred tax assets and liabilities
 have been computed on the timing differences applying the enacted tax
 rates.
 
 The deferred tax asset as on 31st March 2002 is net of:
 
 a) Deferred tax liability
 
 Deferred Revenue Expenditure              Rs. 474 07 729
 
 b) Deferred tax assets
 
 Under section 43B of the Income Tax Act   Rs.  27 01 831
 
 Provision for Doubtful Debts              Rs.  19 97 856
 
 Depreciation                              Rs.  47 94 439
 
 Carried Forward Business loss             Rs. 660 68 210
 
 11. Earning Per Share
 
 The earnings considered in ascertaining the Companys Earnings Per
 Share comprise of net profit/(loss) after tax. The number of shares
 used in computing Basic Earnings Per Share is the weighted average
 number of shares outstanding during the year. The nominal value of
 equity share is Rs. 10 per share.
 
 12. Segment Reporting
 
 The Company considers business segment as the primary segment for
 reporting. Based on the nature of products and services, risk and
 return, organization structure and internal financial reporting, the
 entire activity is considered as one segment viz. Pharmaceuticals.
 
 Segment revenue, segment results and segment assets/amortisation
 thereof is as per the Profit and Loss Account and the Balance Sheet
 respectively.
 
 Geographical segments considered for disclosures are:
 
 Domestic: Sales within India
 
 Export: Sales outside India
 
 The entire activity pertaining to sales outside India is carried out
 from India. 
 
 Details of Geographical Segment:
 
 Particulars                        Domestic       Exports         Total
                                     (India)  (Rest of the World)
                                         Rs.           Rs.           Rs.
 
 Revenue
 
 Income from operations
 
 Segment sales                     111547822     295006798     406554620
 
                                   111547822     295006798     406554620
 
 Other Information
 
 Segment Assets                    852742492     143502284     996244776
 
                                   852742492     143502284     996244776
 
 13. Related Party Transactions:
 
 Key Personnel:
 
 Managing Director: Mr. R. Sundara Rajan
 
 Remuneration: Rs. 12 81304
 
 Mr. K. R. V. Subrahmanian, Chairman
 
 Mr. R. Thyagarajan, Director
 
 Mr. G. V. Raman, Director
 
 Mr. P. V. V. Krishnan, Director
 
 Mr. P. V. Indiresan, Director
 
 Mrs. Anna R. Malhotra, Director
 
 Mr. Anthony B. Plane, Director
 
 Late Mr. B. B. Singh*, Director
 
 Mr. V. Subba Rao, Director
 
 Mr. Nitin Deshmukh, ICICI Venture Nominee (till 29th May 2001)
 
 Mr. K. Bharathan, ICICI Nominee
 
 Mr. Sumit Chandwani, ICICI Venture Nominee (from 24th July 2001)
 
 Total sitting fees paid to the above directors is Rs. 94 000.
 
 * Ceased to be director with effect from 29th October 2001.
 
 14. The Company is yet to receive confirmations from parties in respect
 of balances outstanding in sundry debtors and creditors.
 
 15. Managing Directors Remuneration
 
                                            Year ended        Year ended
                                       31st March 2002   31st March 2001
                                                 (Rs.)             (Rs.)
 
 Salary                                        1020000            960000
 
 Perquisites                                    261304            256488
 
                                               1281304           1216488
 
 16. Payment to Auditors
 
 Audit Fees                                     210000            200000
 
 Certification                                  197050             63000
 
 Out of pocket expenses                           7056              8050
 
                                                414106            271050
 
 17. Expenditure in Foreign Currency (Cash basis)
 
 Technical Know how fee and Consultancy
 services                                      5690310           5794003
 
 Interest                                      6172739           5138138
 
 Travelling Expenses                           4144293           4119787
 
 Sales Commission                              4169451           3813236
 
 Others                                        4555030           5926792
 
                                              24731823          24791956
 
 18. C. I. F. Value of Imports
 
 Raw materials                                48257553          61922174
 
 Capital goods                                 4489915           5425522
 
                                              52747468          67347696
 
 19. F. O. B. Value of Exports
 
 Export of goods                             284429672         223756899
 
 20. Previous years figures have been regrouped and re-classified
 wherever necessary to conform to current years classification.