The Directors are pleased to present the 14th Annual Report of the
 Company together with the Audited Accounts for the financial year ended
 March 31, 2012.
 
 Financial Results
 
                                            (Amount Rupees in Crores)
 
 Particulars                                      2011-12     2010-11
 
 Total Income                                       49.80       45.91
 
 Expenditure (before Finance Cost & 
 Depreciation)                                      43.14       41.30
 
 Profit before Finance Cost & Depreciation           6.66        4.60
 
 Finance Cost                                        1.29        0.56
 
 Profit before Depreciation and Tax                  5.38        4.05
 
 Depreciation                                        0.92        0.81
 
 Profit/Loss before tax                              4.45        3.24 
 
 Provision for Tax
 
 - Current Tax                                       0.96        0.65
 
 - Deferred Tax                                      0.29        0.30 
 
 Profit after Tax                                    3.20        2.28 
 
 Income tax Prior period                            (0.36)       0.15
 
 Profit after tax and prior period                   2.84        2.43
 
 Add: Balance brought forward from the Previous 
 Year                                               17.88       16.26
 
 Appropriations
 
 Provision for Proposed Dividend                     0.49        0.49
 
 Provision for Dividend Tax                          0.08        0.08
 
 Transfer to General Reserve                         0.32        0.23
 
 Balance carried to Balance Sheet                   19.83       17.88
 
 Review of the Business
 
 During the year, your Company has achieved a total income of Rs.49.80
 Crores as against Rs. 45.91 Crores in the previous year and earned a
 net profit of Rs. 2.84 Crores (Previous Year Rs.2.43 Crores) after
 providing Income Tax, Deferred Tax and prior period expenses of Rs.1.61
 Crores (Previous Year Rs.0.81 Crores). Your Directors are confident of
 achieving better results in the years to come. The Board of Directors
 are of the opinion that the present and future market scenario of the
 Pharma Sector is extremely good as discussed in detail in Management
 Discussion and Analysis and accordingly proposes to expand its
 manufacturing facilities.
 
 Dividend
 
 Your Directors have recommended a dividend of Rs.0.50 per equity share
 for the year ended 31st March, 2012 being 5% of the Paid-up Equity
 Capital of the Company. The dividend, if approved at the ensuing 14th
 Annual General Meeting will be paid to those members whose names appear
 on the Company''s Register of Members on September 29, 2012. The total
 amount of outgo on account of this will be Rs.0.49 Crores towards
 dividend and Rs.0.08 Crores towards dividend tax. The dividend would be
 tax free in the hands of the shareholders.
 
 Listing:
 
 The equity shares are listed on BSE Limited. However, the scrip was
 temporarily suspended from trading due to non submission of compliance
 as per listing agreement (which are categorised as penal reasons by the
 BSE Limited). Your Directors are making efforts to revoke the
 suspension and it is in process.
 
 Transfer to Reserves:
 
 Your Company proposes to transfer Rs.0.32 Crores to the General Reserve
 out of the amount available for appropriations.
 
 Share Capital:
 
 The Company has only one class of shares viz., Equity share of face
 value of Rs.10/- each. The total issued and subscribed capital of the
 Company is Rs.10.25 Crores. The paid up capital of the Company is Rs.
 10.07 Crores.
 
 Corporate Governance:
 
 Your Company is committed to maintain highest standards of Corporate
 Governance. As required under Clause 49 of the Listing Agreement with
 the Stock Exchange, a report on Corporate Governance as well as
 Auditors Certificate on the Compliance of Corporate Governance are
 annexed to this Report.
 
 Management Discussion and Analysis:
 
 A detailed Report on Management Discussion and Analysis is provided as
 a separate section in the Annual Report.
 
 Directors:
 
 Mr. Boosa Eshwar, has been appointed as an Additional Director of the
 Company with effect from May 03, 2012. Approval of the Members for his
 appointment is being sought and forms part of the Notice of this Annual
 General Meeting of the Company.
 
 Mr. G. Rama Raju and Mr. Harichandra Kantimahanti will retire at the
 ensuing Annual General Meeting and being eligible, offers themselves
 for re-appointment. Their re-appointment is being proposed and suitable
 resolutions forms part of the Notice of the ensuing Annual General
 Meeting.
 
 Auditors
 
 The Present Statutory Auditors of the Company M/s. P.S.N. Ravishanker &
 Associates, Chartered Accountants, Hyderabad retire at the ensuing
 Annual General Meeting and have confirmed their eligibility and
 willingness to accept office of Auditors and if reappointed, their
 reappointment would be within the limits prescribed under Section
 224(1B) of the Companies Act, 1956. The Board of Directors recommend
 M/s P.S.N.  Ravishanker & Associates, Chartered Accountants, Hyderabad
 for reappointment as Statutory Auditors of the Company for the
 financial year 2012-13.
 
 Cost Audit:
 
 Pursuant to Section 233B of the Companies Act, 1956, the Central
 Government has prescribed Cost Audit of the Company''s bulk drugs
 division.
 
 Based on the recommendations of the Audit Committee, and subject to the
 approval of the Central Government, the Board of Directors had
 appointed Mr. Sativada Venkat Rao as cost auditor of the Company for
 the Financial Year 2012-13. The cost audit report would be filed with
 the Central Government on or before the due date.
 
 Research & Development:
 
 The Company has incurred an expenditure of Rs.0.63 Crores on research
 and development during the year.
 
 Public Deposits:
 
 The Company has not invited/accepted deposits from the public within
 the meaning of Section 58A of the Companies Act, 1956.
 
 Directors Responsibility Statement:
 
 Pursuant to the requirement under Section 217 (2AA) of the Companies
 Act, 1956, the Board of Directors of the Company hereby state and
 confirm:
 
 i. that in the preparation of the annual accounts, the applicable
 accounting standards had been followed along with proper explanation
 relating to material departures;
 
 ii. that the directors had selected such accounting policies and
 applied them consistently and made judgments and estimates that are
 reasonable and prudent so as to give a true and fair view of the state
 of affairs of the Company at the end of the financial year 2011-12 and
 of the profit of the company for that period.
 
 iii. that the directors had taken proper and sufficient care for the
 maintenance of adequate accounting records in accordance with the
 provisions of this Act for safeguarding the assets of the company and
 for preventing and detecting fraud and other irregularities;
 
 iv.  that the directors had prepared the annual accounts on a Going
 Concern basis.
 
 Particulars of Employees:
 
 The Company do not have any employees drawing remuneration within the
 purview of Section 217 (2A) of the Companies Act, 1956 to be read with
 the Companies (Particulars of Employees) Rules, 1975 as amended.
 
 Particulars under section 217 (1) (e) of the Companies Act, 1956
 
 Information regarding Energy Conservation, Technology Absorption and
 Foreign Exchange Earnings and Outgo required to be disclosed under
 Section 217 (1) (e) of the Companies Act, 1956 read with Companies
 (Disclosure of Particulars in the Report of Board of Directors) Rules,
 1988 is enclosed as an Annexure.
 
 Industrial Relations:
 
 Industrial relation has been cordial and your directors appreciate the
 sincere and efficient services rendered by the employees at all levels
 towards the successful working of the Company.
 
 Acknowledgement:
 
 Your Directors wish to take this opportunity to thank the employees for
 their dedicated service and contribution to the Company. We also thank
 Bank of India, Government Agencies, Business Associates, Shareholders
 and Investors at large for their continued support towards conduct of
 efficient operations of the Company.
 
                                      For and on behalf of the Board
 
                                                                Sd/-   
                                                        G. Rama Raju
                                                            Director
 
                                 
                                                                Sd/-   
                                                     G. Ganesh Kumar   
                                        Chairman & Managing Director
 Place: Hyderabad 
 Date : 30/05/2012