The Directors are presenting before you the Eighth Annual Report with
 the Audited Accounts of the Company for the year ended 31st March,
 2000.
  
 Financial Results :                                    (Rs. in Lacs)
 
                                                1999-2000     1998-99
 
 Sales & Other Income                              133.46      175.72 
 
 Loss before Depreciation                          102.11       92.21 
 
 Add : Depreciation                                 21.12       16.93 
 
 Loss before Tax                                   123.23      109.13 
 
 Provision for Tax                                      -           -   
 
 Prior Period Adjustments                          (0.10)      (0.91)
 
 Net Loss for the year
 carried to Balance Sheet                          123.33      108.22   
 
 
 Dividend :
 
 In view of the loss incurred during the year, your Directors do not
 recommend any dividend for the year on Equity Shares of the Company.
 
 Explanation to Remarks in Auditors' Report : The observations made by
 the Auditors in their Report have been duly clarified in the relevant
 notes forming part of the Annual Accounts, which are self explanatory.
 
 Operations :
 
 During the year under report your Company achieved a sales of
 Rs.1,22,18,759/- compared to Rs.1,68,05,864/- in the previous year
 resulting into a net loss of Rs.1,23,33,467/-. However, during the year
 in operation your Company preferred to manufacture value based products
 rather than material based products as a result of which there has been
 reduction compare to last year in the cost of raw materials consumed
 from 84% to 66% of the Sales Value. Although the new products of the
 Company were well accepted in the market there was not sufficient
 demand in the market of the said products for the Company to operate
 its Plant at optimum level and therefore the existing sales were not
 sufficient to absorb the total operational cost.
 
 However in order to achieve optimum utilisation of the existing
 infrastructure of the Company, your Company has decided to introduce
 some more products and for the purpose has retained the services of a
 professional team of experienced technocrats who will provide to the
 Company the necessary Technical Knowhow, Research and Development,
 effective measures for cost and quality control and marketing of the
 said new products. With this new arrangement your Company is expected
 to achieve better results in the current year.
 
 5. Applicability of the provisions of Sick Industrial Companies
 (Special Provisions) Act, 1985 Your Directors had, while presenting the
 accounts for the year ended 31-3-1999, reported that heavy interest
 burden and general sluggish economic performance of all the industries
 in the country and the loss of production for over a period of four
 months due to a fire in the factory were the factors which contributed
 to the heavy loss. However the Directors had sincerely felt that with
 the changes in the product pattern by way of producing intermediates
 for domestic and international pharma industry, the Company would be in
 a position to turn the corner.
 
 The Directors regret to report that demand for the Company's products
 did not pick up and production of certain highly profitable
 intermediates could not be taken up for several reasons. This resulted
 in under utilisation of capacities and simultaneously heavy interest
 burden continued. As a result the Company has incurred a loss of
 Rs.123.33 lacs during the year under report. The total accumulated loss
 till the end of the year under report has amounted to Rs.348 lacs which
 has resulted in the erosion of more than fifty percent of its net
 worth. The provisions of Section 23 of the Sick Industrial Companies
 (Special Provisions) Act, 1985 are therefore applicable to the Company.
 In terms thereof the Board of Directors of the Company is required to
 make a report to the Board of Industrial and Financial Reconstruction
 (BIFR). Your Directors are also taking the necessary steps to call a
 separate general meeting of the shareholders to report and explain the
 causes of such situation; and they will make a report to the BIFR in
 due course as required under the Act.
 
 The Directors take this opportunity to assure the Members that besides
 complying with the necessary legal requirements as required under the
 relevant provisions of Sick Industrial Companies (Special Provisions)
 Act, 1985 no efforts will be spared to revive and strengthen the
 Company from its present difficult position.
 
 Directors :
 
 S/Shri P. N. Shah, Ashok R. Mehta and Jitendrakumar S. Kothari are
 retiring as Directors at the ensuing Annual General Meeting and being
 eligible offer themselves for re-appointment. The Board recommends
 their re-appointment.
 
 During the year Shri Champakbhai H.  Malvaniya resigned as a Director
 of the Company and the Board has placed on record its appreciation of
 the valuable services rendered by him during his tenure as a Director
 of the Company. In the vacancy so caused by the resignation of Shri
 Champakbhai H. Malvaniya, the Board in their meeting held on 26th July,
 2000 has appointed Mr. A. K.  Chakraborty as a Director.
 
 Mr. A. K. Chakraborty has also been appointed as a Whole-time Director
 of the Company for a period of 5 years with effect from 1 st August,
 2000 subject to the approval of the shareholders at the ensuing Annual
 General Meeting of the Company.
 
 Insurance :
 
 All the properties of the Company including Buildings, Plant &
 Machineries, Vehicles and Capita] Work in Progress are adequately
 insured.
 
 Auditors :
 
 M/s Atul Dalal & Co., Chartered Accountants, Auditors of the Company,
 retire at the conclusion of this Annual General Meeting and being
 eligible offer themselves for re-appointment. The Board recommends
 their re-appointment.
 
 Particulars of Employees :
 
 None of the employees of the Company is in receipt of remuneration of
 more than Rs.50,000/- p.m. or more than Rs.6,00,000/- p.a. during the
 year. Hence the provisions of Section 217(A) of the Companies Act, 1956
 are not applicable.
 
 10. Particulars of Conservation of Energy, Technology Absorption etc.
 and Foreign Exchange Earning and Outgo :
 
 Additional information on Conservation of Energy, Technology
 Absorption, Foreign Exchange Earnings and Outgo as required to be
 disclosed in terms of Section 217(1) (e) of the Companies Act, 1956
 read with the Companies (Disclosure of particulars in the Report of the
 Board of Directors) Rules, 1988 is annexed hereto and forms part of the
 Report.
 
 Deposits :
 
 During the year your Company has not invited or accepted any deposit
 from the public within the meaning of Section 58A of the Companies Act,
 1956.
 
 Disclosure of particulars with respect to Conservation of Energy,
 Technology Absorption and Foreign Exchange Earnings and Outgo as
 required under the Companies (Disclosure of Particulars in the of Board
 of Directors' Report) Rules, 1988.
 
 1. Conservation of Energy :
 
 (A) Energy conservation measures taken                           : Nil
 
 (B) Additional Investment & proposals if any, being 
 implemented for reduction of consumption of Energy               : Nil
 
 (C) Impact of the measures at (A) & (B) above for reduction 
 of the Energy Consumption and consequent impact on the Cost 
 of Production of Goods.                                          : Nil
 
 (D) Total Energy Consumption and Energy Consumption 
 per unit of Production                                 Form A Enclosed
 
 (2) Technology absorption                             : Not Applicable
 
 (3) Foreign Exchange Earnings & Outgo :
 
 (A) Activity relating to exports initiatives taken exports development
 of new export markets for products and services and export plans. :
 
 The Company is constantly making efforts for exploring export market
 for its product.
 
 (B) Total Foreign Exchange Used  : Nil
 
 Total Foreign Exchange Earned    : Nil