annual report09 10 glenmark

ANNUAL REPORT 2009-2010 31

Auditors’ Report

Auditors’ report to the Board of Directors of Glenmark Pharmaceuticals Limited on the Consolidated Financial Statements of Glenmark

Pharmaceuticals Limited

1. We have audited the attached consolidated balance sheet of Glenmark Pharmaceuticals Limited (the “Company”) and its subsidiaries

and its jointly controlled entity; hereinafter referred to as the “Group” (refer Note 1 on Schedule 21 to the attached consolidated

fi nancial statements) as at 31st March, 2010, the related consolidated Profi t and Loss Account and the consolidated Cash Flow

Statement for the year ended on that date annexed thereto, which we have signed under reference to this report. These consolidated

fi nancial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these

fi nancial statements based on our audit.

2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards require that we plan

and perform the audit to obtain reasonable assurance about whether the fi nancial statements are free of material misstatement. An

audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the fi nancial statements. An audit also

includes assessing the accounting principles used and signifi cant estimates made by management, as well as evaluating the overall

fi nancial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. We did not audit the fi nancial statements of thirty three subsidiaries and one jointly controlled entity included in the consolidated

fi nancial statements, which constitute total assets of Rs. 10,603,282 (‘000) and net assets of Rs. 5,254,257 (‘000) as at 31st March,

2010, total revenue of Rs. 16,886,790 (‘000), net profi t of Rs. 2,076,632 (’000) and net cash fl ows amounting to Rs. 436,382 (‘000) for

the year then ended. These fi nancial statements and other fi nancial information have been audited by other auditors whose reports

have been furnished to us, and our opinion on the consolidated fi nancial statements to the extent they have been derived from such

fi nancial statements is based solely on the report of such other auditors.

4. We report that the consolidated fi nancial statements have been prepared by the Company’s Management in accordance with the

requirements of Accounting Standard (AS) 21 - Consolidated Financial Statements and Accounting Standard (AS) 27 - Financial

Reporting of Interests in Joint Ventures notifi ed under sub-section 3C of Section 211 of the Companies Act, 1956.

5. Based on our audit and on consideration of reports of other auditors on separate fi nancial statements and on the other fi nancial

information of the components of the Group as referred to above, and to the best of our information and according to the

explanations given to us, in our opinion, the attached consolidated fi nancial statements give a true and fair view in conformity with

the accounting principles generally accepted in India:

(a) in the case of the consolidated Balance Sheet, of the state of aff airs of the Group as at 31st March, 2010;

(b) in the case of the consolidated Profi t and Loss Account, of the profi t of the Group for the year ended on that date; and

(c) in the case of the consolidated Cash Flow Statement, of the cash fl ows of the Group for the year ended on that date.

For Price Waterhouse

Firm Registration Number: 301112E

Chartered Accountants

Partha Ghosh

Partner

Membership Number: F-55913

Place: Mumbai

Date: 28th May, 2010

32 GLENMARK PHARMACEUTICALS LIMITED

Consolidated Balance Sheet

Rs. in (‘000s)

Schedules

As at

31st March, 2010

As at

31st March, 2009

I. SOURCES OF FUNDS

1. SHAREHOLDERS' FUNDS

a) Capital 1 269,838 250,520

b) Reserves and Surplus 2 23,282,495 15,731,044

23,552,333 15,981,564

2. MINORITY INTEREST 130,075 31,552

3. LOAN FUNDS

a) Secured Loans 3 2,414,139 3,826,548

b) Unsecured Loans 4 16,279,767 17,116,917

18,693,906 20,943,465

4. DEFERRED TAX LIABILITY 5 1,275,009 1,054,748

TOTAL 43,651,323 38,011,329

II. APPLICATION OF FUNDS

1. FIXED ASSETS 6

a) Gross Block 21,755,428 18,385,786

b) Less: Depreciation 3,882,342 2,723,341

c) Net Block 17,873,086 15,662,445

d) Capital Work-in-progress 6,007,692 5,454,080

23,880,778 21,116,525

2. INVESTMENTS 7 181,229 181,229

3. DEFERRED TAX ASSET 8 564,860 485,489

4. CURRENT ASSETS, LOANS AND ADVANCES

a) Inventories 9 7,084,591 6,302,253

b) Sundry Debtors 10 10,782,779 9,553,428

c) Cash and Bank Balances 11 1,070,200 714,823

d) Loans and Advances 12 5,273,096 4,220,877

24,210,666 20,791,381

LESS: CURRENT LIABILITIES AND PROVISIONS

a) Current Liabilities 13 4,986,466 4,398,904

b) Provisions 14 199,744 164,391

5,186,210 4,563,295

NET CURRENT ASSETS 19,024,456 16,228,086

TOTAL 43,651,323 38,011,329

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 21

Schedules referred to above and notes attached thereto form an integral part of the

Consolidated Balance Sheet.

This is the Consolidated Balance Sheet referred to in our report of even date.

For Price Waterhouse For and on behalf of the Board of Directors



Partha Ghosh Glenn Saldanha Cheryl Pinto A. S. Mohanty

Partner Managing Director & CEO Director Director


Place: Mumbai Marshall Mendonza

Date: 28th May, 2010 Vice President - Legal & Company Secretary


Consolidated Profi t and Loss Account

Rs. in (‘000s)

Schedules

Year ended

31st March, 2010

Year ended

31st March, 2009

INCOME

Sales & Operating Income 15 25,006,466 21,160,332

Other income 16 489,635 1,740,116

25,496,101 22,900,448

EXPENDITURE

Cost of Sales 17 10,193,390 8,750,997

Selling and Operating Expenses 18 7,844,662 6,976,794

Depreciation/Amortisation 6 1,206,104 1,026,827

Interest (net) 19 1,640,213 1,404,766

Research and Development Expenses 20 772,758 882,703

21,657,127 19,042,087

Profi t before Tax and Exceptional items 3,838,974 3,858,361

Exceptional Item - 1,169,548

PROFIT BEFORE TAX 3,838,974 2,688,813

Provision for Taxation

- Current Year [includes wealth tax provision Rs. 200 (2009 - Rs. 288)] 914,730 651,299

- Mat Credit (Entitlement)/Utilisation (520,504) 395,278

- Deferred Tax 137,071 (383,148)

- Fringe Benefi t Tax - 81,373

- Prior Period Tax (2,639) 9,282

NET PROFIT AFTER TAX BEFORE MINORITY INTEREST 3,310,316 1,934,729

Share of (profi t)/loss transfer to Minority (65,608) (18,092)

NET PROFIT AFTER TAX & MINORITY INTEREST 3,244,708 1,916,637

Balance Profi t Brought Forward 11,215,453 10,276,665

NET PROFIT AVAILABLE FOR APPROPRIATION 14,460,161 12,193,302

Proposed Dividend on Equity Shares 107,935 100,208

Tax on Proposed Dividend on Equity Shares 17,927 17,030

Residual Dividend and Dividend Tax 163 -

Transfer to Foreign Currency Monetary Item Translation Diff erence Account - 366,121

Transfer to General Reserve 128,463 494,490

BALANCE CARRIED TO BALANCE SHEET 14,205,673 11,215,453

Earnings Per Share (Rs.) [Refer Note 5 of Schedule 21]

Basic 12.4 7.7

Diluted 12.4 7.5

Face Value per Share 1.0 1.0

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 21


Consolidated Profi t and Loss Account.

This is the Consolidated Profi t and Loss Account referred to in our report of even date.










Consolidated Cash lo State ent

Rs. in (‘000s)

Year ended

31st March, 2010

Year ended

31st March, 2009

A. CASH FLOW FROM OPERATING ACTIVITIES:

Net Profi t before tax 3,838,974 2,688,813

Adjustments for:

Depreciation 1,206,104 1,026,827

Interest Expense 1,655,035 1,457,208

Interest Income (14,822) (52,442)

Income from Investment - Dividends (75) (38)

(Profi t)/Loss on Fixed Assets sold 8,413 518

Bad Debts written off - 5,729

Provision for Bad & Doubtful Debts 32,932 54,181

Provision for Doubtful Advances (700) -

Provision for Gratuity & Leave Encashment 47,838 53,414

Unrealised foreign exchange (gain)/loss (282,149) 196,081

Operating Profi t Before Working Capital Changes 6,491,550 5,430,291

Adjustments for changes in Working Capital:

- (Increase) in Sundry Debtors (1,168,169) (1,580,108)

- (Increase) in Other Receivables (571,227) (1,215,386)

- (Increase) in Inventories (782,338) (2,294,862)

- Increase in Trade and Other Payables 428,159 1,213,717

Cash Generated from Operations 4,397,975 1,553,652

- Taxes (Paid) (873,954) (1,394,571)

Net Cash from Operating Activities 3,524,021 159,081

B. CASH FLOW FROM INVESTING ACTIVITIES:

Purchase of Fixed Assets (3,404,395) (7,662,729)

Capital Work-in-Progress (553,612) (2,081,793)

Proceeds from Sale of Fixed Assets 73,984 183,496

Proceeds/(Payment) for Sale/Purchase of Investments - 6,942

Interest Received 14,822 52,442

Dividend Received 75 38

Net Cash used in Investing Activities (3,869,126) (9,501,604)


Consolidated Cash lo State ent

Rs. in (‘000s)

Year ended

31st March, 2010

Year ended

31st March, 2009

C. CASH FLOW FROM FINANCING ACTIVITIES:

Proceeds from Fresh Issue of

Share Capital (including Securities Premium) 4,142,780 350,586

Net Assets fi nanced by Minority Shareholders 32,915 (1,336)

Exchange Fluctuation Reserves 16,015 (254,409)

Proceeds/(Payment) of Long Term Borrowings 6,639,196 164,905

Proceed from Short Term Borrowings (5,250,473) 8,059,154

Proceeds from Working Capital Facilities movement (2,713,047) 1,614,427

Redemption of FCCB (279,960) -

FCCB Premium paid on redemption including TDS (105,288) -

Interest Paid (1,663,660) (1,441,050)

Dividend Paid (100,966) -

Dividend Tax Paid (17,030) -

Net Cash from Financing Activities 700,482 8,492,277

Net Increase/(Decrease) in Cash and Cash Equivalents 355,377 (850,246)

Cash and Cash Equivalents as at 31st March, 2009 714,823 1,565,069

Cash and Cash Equivalents as at 31st March, 2010 1,070,200 714,823

Cash and Cash Equivalents Comprise:

Cash 3,839 6,123

Deposits with Scheduled Banks 31,214 51,126

Deposits with Non-Scheduled Banks 2,829 126

Balance with Scheduled Banks 145,815 92,669

Balance with Non-Scheduled Banks 886,503 564,779

1,070,200 714,823

Notes:

1. The Cash Flow Statement has been prepared under the "Indirect Method" as set out in Accounting Standard - 3 on Cash Flow

Statements issued by the Institute of Chartered Accountants of India.

2. Cash and Cash Equivalents includes Rs. 3,122 which are not available for use by the Company. (Refer Schedule 13 to the Consolidated

Financial Statements)

3. Figures in bracket indicate Cash outgo.

This is the Consolidated Cash Flow Statement referred to in our report of even date.










Schedules annexed to and forming part of the Consolidated Balance Sheet

Rs. in (‘000s)

As at

31st March, 2010

As at

31st March, 2009

1. CAPITAL

Authorised

350,000,000 (2009 – 350,000,000) Equity Shares of Re. 1 each 350,000 350,000

4,000,000 (2009 – 4,000,000) Cumulative Redeemable Non-Convertible

Preference Shares of Rs. 100 each 400,000 400,000

Issued, Subscribed and Paid-up


TOTAL 269,838 250,520

Notes:

1. During the year ended 31st March, 2010 the Company, pursuant to Employee Stock Option Scheme 2003, has granted 236,500

(2009 - 2,305,500) options at market price as defi ned in SEBI (ESOS) Guidelines and cancelled 601,100 (2009 - 1,697,500) options.

2. During the year 604,860 (2009 - 500,300) options were converted into Equity Shares under the Employee Stock Option Scheme,

2003. As at 31st March, 2010 2,633,500 options were outstanding under Employee Stock Option Scheme 2003. On exercise of the

options so granted under Employee Stock Option Scheme 2003, the paid up Equity Share Capital of the Company will increase by a

like number of shares.

3. During the year, Nil (2009 - 7,500) Zero Coupon Foreign Currency Convertible Bonds (FCCB) of USD 1,000 each aggregating USD Nil

(2009 - USD 7.5 million) were converted into Nil (2009 - 1,293,706) equity shares of Re. 1 each. As at 31st March, 2010, FCC Bonds

amounting to USD 30 million were outstanding.

4. On 18th September, 2009 the Company allotted 18,712,935 Equity Shares of Re. 1 each at a premium of Rs. 220/- per share to Qualifi ed

Institutional Buyers pursuant to chapter VIII of the Securities Exchange Board of India (Issue of Capital and Disclosure Requirement)

Regulation 2009.

5. Of the above 158,371,140 (2009 - 158,371,140) Equity Shares of Re. 1 each are allotted as fully paid-up Bonus Shares by Capitalisation

of Reserves.



Rs. in (‘000s)

As at

31st March, 2010

As at

31st March, 2009

2. RESERVES AND SURPLUS

Securities Premium Account

Balance at the beginning of the year 3,184,454 2,896,843

Add: Premium on Issue of Shares pursuant to Conversion of ESOP 36,659 22,636

Add: Premium on Issue of Shares to Qualifi ed Institutional Buyers 4,116,846 -

Less: Issue expenses on issue of shares to QIBs 65,829 -

Add: Premium on Issue of Shares pursuant to Conversion of FCC Bonds - 326,156

Add: Writeback of redemption premium for FCC Bonds converted during the year - 66,115

Less: Redemption premium of FCC Bonds outstanding at year end 149,623 127,296

Add: Tax impact on FCCB redemption premium 35,787 -

Closing Balance 7,158,294 3,184,454

General Reserve


Add: Transferred from Profi t & Loss Account 128,463 494,490

Add: Transfer to Fixed assets (Refer Note 11 of Schedule 21) - 3,915

Less: Transfer from Foreign Currency Monetary Item Translation Diff erence Account

(Refer Note 11 of Schedule 21) - 491,095


Foreign Currency Monetary Item Translation Diff erence Account

Balance at the beginning of the year (178,259) -

Addition/(Reduction) during the year 645,275 (289,670)

Amortisation of Foreign Currency Monetary Item Translation Diff erence (202,362) 111,411

Closing Balance 264,654 (178,259)

Capital Redemption Reserve 200,000 200,000

Capital Reserve 1,000 1,000

Exchange Fluctuation Reserves

Balance at the beginning of the year (185,940) 68,469

Addition/(Reduction) during the year 16,015 (254,409)

Closing Balance (169,925) (185,940)

Profi t and Loss Account Balance 14,205,673 11,215,453

TOTAL 23,282,495 15,731,044

3. SECURED LOANS

From Banks Note

Term Loan 1 2,266,286 873,080

Working Capital Facilities 2 147,853 2,860,900

Other Loans 3 - 92,568

TOTAL 2,414,139 3,826,548

Notes:

1. Term loan is secured by way of exclusive charge as the case may be, at certain locations, on Company's fi xed assets both present and

future.

2. Working Capital Facilities is secured by hypothecation of Stocks of raw materials, packing materials, fi nished goods, work-in-process,

receivables and equitable mortgage on fi xed assets at the manufacturing facility at Nasik and Research and Development centre at

Sinnar, Nasik.

3. Other Loans are secured by way of Hypothecation of certain Premises, Equipment and Vehicles.


Rs. in (‘000s)

As at

31st March, 2010

As at

31st March, 2009

4. UNSECURED LOANS

Short Term Loan from Banks 4,100,431 9,358,889

Other Loans from Banks 10,771,319 5,876,916

Foreign Currency Convertible Bonds (due within one year) [Refer Note 6 of Schedule 21] 1,354,200 1,835,280

Security Deposit 53,817 45,832

TOTAL 16,279,767 17,116,917

5. DEFERRED TAX LIABILITY [Refer Note 2(xi) of Schedule 21]

Depreciation 1,158,540 880,151

Foreign Currency Long Term Loans and Others 17,809 174,597

Others 98,660 -

TOTAL 1,275,009 1,054,748


6. FIXED ASSETS [Refer Note 2(ii), 2(iii), 2(iv), 2(v)(b) and 2(xii) of Schedule 21]

Rs. in (‘000s)

GROSS BLOCK DEPRECIATION / AMORTISATION NET BLOCK

As on

31st March,

2009

Acquisition

during the

year

Additions

during the

year

Consolidation

Adjustment

Deduction As on

31st March,

2010

As on

31st March,

2009

Acquisition For the

year

Consolidation

Adjustment

On

Deduction

As on

31st March,

2010

As on

31st March,

2010

As on

31st March,

2009

Tangible assets

Freehold Land 52,067 - 11,737 (2,391) - 61,413 - - - - - - 61,413 52,067

Leasehold Land 203,208 - 162,692 (6,008) (54,400) 305,492 20,189 - 9,742 (2,364) (1,098) 26,469 279,023 183,019

Factory Buildings 2,194,377 - 648,971 68,995 - 2,912,343 182,621 - 73,164 (5,611) - 250,174 2,662,169 2,011,756

Other Buildings and

Premises

883,441 - 75,808 41,007 (1,872) 998,384 98,875 - 41,155 (5,604) (64) 134,362 864,022 784,566

Plant and Machinery 2,156,556 - 147,799 127,232 (1,661) 2,429,926 143,259 - 63,925 2,655 (46) 209,793 2,220,133 2,013,297

Furniture and

Fixtures

602,068 - 68,158 17,386 (262) 687,350 173,824 - 53,804 (806) (9) 226,813 460,537 428,244

Equipments 3,002,184 - 615,669 161 (4,776) 3,613,238 681,241 - 315,893 (15,421) (3,189) 978,524 2,634,714 2,320,943

Vehicles 110,284 - 25,688 (1,835) (14,315) 119,822 47,380 - 18,632 (1,709) (7,886) 56,417 63,405 62,904

Intangible assets

Goodwill 800,586 - 116,703 26,084 - 943,373 236,803 - 35,588 10,409 - 282,800 660,573 563,783

Computer software 480,743 - 85,001 41,236 (16,558) 590,422 103,936 - 42,039 2,981 (152) 148,804 441,618 376,807

Brands 7,900,272 - 1,677,821 (482,566) (1,862) 9,093,665 1,035,213 - 552,162 (19,189) - 1,568,186 7,525,479 6,865,059

TOTAL 18,385,786 - 3,636,047 (170,699) (95,706) 21,755,428 2,723,341 - 1,206,104 (34,659) (12,444) 3,882,342 17,873,086 15,662,445

Previous Year 11,241,021 - 9,327,763 521,104 (2,704,102) 18,385,786 2,055,881 - 1,026,827 81,670 (441,037) 2,723,341

Capital Work-in-progress 6,007,692 5,454,080

Notes:

1. Equipment and Other Premises include assets aggregating Rs. 162,435 (2009 – Rs. 26,539) [net book value as at 31st March, 2010 – Rs. 71,844 (2009 – Rs. Nil)], and Rs. 132,422 (2009 – Rs. 81,438) [net book value as

at 31st March, 2010 – Rs. 64,012 (2009 – Rs. 31,065)] respectively, which have been acquired on fi nance lease.

2. Addition to assets include Rs. 7,499 (2009 - Rs. 5,400) being borrowing costs.



Rs. in (‘000s)

As at

31st March, 2010

As at

31st March, 2009

7. INVESTMENTS [Refer Note 2(vi) of Schedule 21]

LONG TERM INVESTMENTS - At Cost - fully paid

Quoted - non-trade

Equity shares

9,000 (2009 – 9,000) Bank of India of Rs. 10 each [Market Value Rs. 3,067 (2009 – Rs. 1,979)] 405 405

1,209 (2009 – 1,209) IDBI Bank Limited of Rs. 10 each [Market Value Rs. 139 (2009 – Rs. 55)] 34 34

439 439

Investment in Government Securities

National Savings Certifi cate - Sixth Issue 22 22

National Savings Certifi cate - Eighth Issue 10 10

Unquoted - non-trade

1 (2009 – 1) Time Share of Dalmia Resorts Limited 20 20

1 (2009 – 1) Equity Share of Esquados 340,000 of Glenmark Pharmaceutica Limitada.,

Lisbon (Portugal) 48 48

213,032 (2009 - 213,032) Equity Shares of Bharuch Eco-Aqua Infrastructure Limited of

Rs. 10 each, fully paid-up 2,130 2,130

1,350,000 (2009 - 1,350,000) 7% cumulative preference shares of Rs. 100 each fully

paid-up of Marksans Pharma Ltd. 135,000 135,000

Investment with Napo Pharmaceuticals Inc.

[1,176,471 (2009 - 1,176,471) Preferred shares of USD 0.85 each] 43,560 43,560

180,790 180,790

TOTAL 181,229 181,229

Aggregate book value of Investments

- Quoted [Market value Rs. 3,206 (2009 - Rs. 2,034)] 439 439

- Unquoted 180,790 180,790

TOTAL 181,229 181,229

8. DEFERRED TAX ASSET [Refer Note 2(xi) of Schedule 21]

Provision for Bad Debts and Doubtful Advances 79,968 69,784

Unabsorbed Losses and Depreciation 421,839 307,669

Others 63,053 108,036

TOTAL 564,860 485,489

9. INVENTORIES [Refer Note 2(vii) of Schedule 21]

(As certifi ed by the management)

Raw Materials 1,588,410 1,187,623

Packing Materials 344,867 259,356

Work-in-Process 1,143,752 951,568

Stores and Spares 49,811 45,235

Finished Goods 3,957,751 3,858,471

TOTAL 7,084,591 6,302,253

10. SUNDRY DEBTORS

Outstanding for more than six months

Secured, considered good 98,460 -

Unsecured, considered good 3,541,547 1,524,610

Unsecured, considered doubtful 234,927 191,959

3,874,934 1,716,569

Less: Provision for doubtful debts 234,927 191,959

3,640,007 1,524,610

Other debts -

Secured, considered good 41,275 2,543


7,142,772 8,028,818

TOTAL 10,782,779 9,553,428


Rs. in (‘000s)

As at

31st March, 2010

As at

31st March, 2009

11. CASH AND BANK BALANCES

Cash in hand 3,839 6,123

Balances with Scheduled Banks

- Current Accounts 122,659 92,593

- Margin Money Account 31,214 51,126

- EEFC Account 23,156 76

Balances with Non-Scheduled Banks


- Deposit Accounts 2,829 126

TOTAL 1,070,200 714,823

The balances in the margin money accounts are given as security against guarantees

issued by banks on behalf of the Company.

12. LOANS AND ADVANCES (unsecured, considered good unless otherwise stated)

Advances recoverable in cash or kind or for value to be received

Considered good 2,439,132 1,767,369

Considered doubtful 29,100 29,800

2,468,232 1,797,169

Less: Provision for Doubtful advances (29,100) (29,800)

2,439,132 1,767,369

Advance to Vendors 773,046 772,069

Advance tax (net of provision) 491,526 531,737

MAT Credit Entitlement 685,253 164,749

Balance with Excise Authorities 702,579 800,335

Deposits 181,560 184,618

TOTAL 5,273,096 4,220,877

13. CURRENT LIABILITIES

Acceptances 821,134 -

Sundry Creditors

- Total outstanding dues to Micro enterprises and small enterprises - 26,524

- Total outstanding dues to creditors other than Micro enterprises and small enterprises 2,971,576 3,408,255

Investor Education and Protection Fund shall be credited by

- Unclaimed Dividend 3,122 3,717

[There are no amounts due and outstanding to be credited to Investor Education and

Protection Fund]

Advances from Customers - 46,648

Other Liabilities 732,644 491,478

Interest accrued but not due 457,990 422,282

TOTAL 4,986,466 4,398,904

14. PROVISIONS

Proposed Dividend 107,935 100,208

Tax payable on Proposed Dividend 17,927 17,030

Provision for Wealth Tax 252 276

Provision for Fringe Benefi t Tax - 2,050

Provident Fund Scheme payable 7,543 7,288

Provision for Gratuity and Leave Encashment 66,087 37,539

TOTAL 199,744 164,391



Schedules annexed to and forming part of the Consolidated Profi t and Loss Account

Rs. in (‘000s)

Year ended

31st March, 2010

Year ended

31st March, 2009

15. SALES AND OPERATING INCOME [Refer Note 2(ix) of Schedule 21]

Sale of goods and IP assets 24,991,174 21,145,423

Income from services 15,292 14,909

TOTAL 25,006,466 21,160,332

16. OTHER INCOME

Lease Rent 2,184 11,431

Dividend received on non-trade Investments 75 38

Exchange gain - 1,352,331

Export Incentive 237,605 297,093

Provision for Doubtful Advances Written back 700 -

Miscellaneous Income 249,071 79,223

TOTAL 489,635 1,740,116

17. COST OF SALES

Salary, wages, bonus and allowances 495,374 485,023

Contribution to Provident and other Funds 10,320 8,838

Labour charges 316,135 325,489

Consumption of raw & packing materials 5,441,962 4,917,533

Purchase of Traded goods 2,692,326 3,774,902

Excise Duty 201,880 295,483

Sales Tax 680,848 462,829

Power, fuel and water charges 293,220 231,447

Consumption of stores and spares 174,600 153,144

Repairs and maintenance - plant and machinery 64,040 61,395

Repairs and maintenance - building 21,193 18,600

Rent, rates and taxes 13,633 8,027

Other manufacturing expenses 79,323 119,990

(Increase)/Decrease in inventory (291,464) (2,111,703)

TOTAL 10,193,390 8,750,997


Rs. in (‘000s)

Year ended

31st March, 2010

Year ended

31st March, 2009

18. SELLING AND OPERATING EXPENSES

Salary, bonus and allowances 2,173,598 2,057,021

Contribution to Provident and other funds 144,732 103,402

Staff welfare expenses 75,509 69,133

Directors' salaries, allowances and commission 105,799 144,805

Incentive and commission 191,060 140,813

Sales promotion expenses 1,529,366 1,370,270

Export Commission 62,007 59,620

Commission on sales 125,238 45,193

Travelling expenses 654,307 690,247

Freight outward 514,716 465,045

Telephone expenses 90,112 59,673

Rates and taxes 39,942 56,049

Provision for doubtful debts 32,932 54,181

Bad debts written off - 5,729

Insurance premium 69,406 69,449

Electricity charges 25,399 24,084

Rent 284,082 270,158

Legal and Professional Expenses 406,242 390,847

Repairs and Maintenance - others 128,143 123,618

Auditors' remuneration and expenses

- Audit fees* 25,455 20,191

- Certifi cation and other matters 485 1,500

- Reimbursement of out-of-pocket expenses 37 124

Loss on sale of fi xed assets 8,413 518

Amortisation of Pre-operative/Preliminary expenses - 7,422

Exchange Loss 290,201 -

Other operating expenses 867,481 747,702

TOTAL 7,844,662 6,976,794

* Audit fees include fees paid to statutory auditors of subsidiary companies.

19. INTEREST (Net)

On term loans from bank 969,981 810,305

On other loans from bank 685,054 646,903

1,655,035 1,457,208

Less: Interest Income

On deposits with banks 14,822 52,442

14,822 52,442

TOTAL 1,640,213 1,404,766

20. RESEARCH AND DEVELOPMENT EXPENSES [Refer Note 2(x) of Schedule 21]

Salary, bonus and allowances 409,688 237,275


Staff welfare expenses 856 168

Directors' Remuneration 225 211


Consumable and Chemicals 62,989 106,084


Repairs and maintenance - building 182 131

Repairs and maintenance - others 24,505 5,631


Other expenses 251,885 502,740

TOTAL 772,758 882,703

Schedules annexed to and forming part of the Consolidated Profi t and Loss Account


Schedules annexed to and forming part of the Consolidated Financial Statements

1. BACKGROUND

The consolidated fi nancial statements relate to Glenmark Pharmaceuticals Limited ( the “Company”) and its following subsidiaries

and Joint Venture company (the “Group”).

Name of the Subsidiary/Joint Venture Country of

Incorporation

Ownership and Percentage

either directly or through

subsidiaries as at 31st March

2010 2009

Glenmark Pharmaceuticals Europe Ltd.* United Kingdom 100% 100%

Glenmark Generics (Europe) Ltd.** (formerly Glenmark Pharmaceuticals (Europe) Ltd.) United Kingdom 100% 100%

Glenmark Pharmaceuticals S.R.O. (Formerly known as Medicamenta A.S.,

Czech Republic)*

Czech Republic 100% 100%

Glenmark Pharmaceuticals SK, S.R.O. * (Formerly known as Medicamenta SK SRO) Slovak Republic 100% 100%

Glenmark Pharmaceuticals S.A.* Switzerland 100% 100%

Glenmark Holding S.A. Switzerland 100% 100%

Glenmark Generics Holding S.A.** Switzerland 100% 100%

Glenmark Generics Finance S.A.** Switzerland 100% 100%

Glenmark Pharmaceuticals S.R.L.* Romania 100% 100%

Glenmark Pharmaceuticals Eood * Bulgaria 100% 100%

Glenmark Distributor SP z.o.o.* Poland 100% 100%

Glenmark Pharmaceuticals SP z.o.o.* Poland 100% 100%

Glenmark Generics Inc. **(formerly Glenmark Pharmaceuticals Inc.) USA 100% 100%

Glenmark Therapeutics Inc.* USA 100% 100%

Glenmark Farmaceutica Ltda* Brazil 100% 100%

Glenmark Generics S.A. ** (formerly Servycal S.A.) Argentina 100% 100%

Glenmark Pharmaceuticals Mexico, S.A. DE C.V. * Mexico 100% 100%

Glenmark Pharmaceuticals Peru SAC * Peru 100% 100%

Glenmark Pharmaceuticals Colombia Ltda.* Colombia 100% 100%

Glenmark Uruguay S.A. (formerly known as Badatur S.A., Uruguay)* Uruguay 100% 100%

Glenmark Pharmaceuticals Venezuela, C.A.* Venezuela 100% 100%

Glenmark Dominicana SRL, Dominican Republic (formerly known as

Glenmark Dominicana S.A.)

Dominican Republic 100% 100%

Glenmark Pharmaceuticals Egypt S.A.E. Egypt 100% 100%

Glenmark Pharmaceuticals FZE U.A.E. 100% 100%

Glenmark Impex L.L.C Russia 100% 100%

Glenmark Philippines Inc. Philippines 100% 100%

Glenmark Pharmaceuticals (Nigeria) Ltd. Nigeria 100% 100%

Glenmark Pharmaceuticals Malaysia Sdn Bhd Malaysia 100% 100%

Glenmark Pharmaceuticals (Australia) Pty Ltd. Australia 100% 100%

Glenmark South Africa (pty) Ltd.* (formerly known as Glenmark Pharmaceuticals

Pty Ltd.)

South Africa 100% 100%

Glenmark Pharmaceuticals South Africa (Pty) Ltd.*(formerly known as Bouwer

Bartlett Pty Ltd.)

South Africa 100% 100%

Glenmark Pharmaceuticals (Thailand) Co. Ltd. Thailand 49% 49%

Glenmark Exports Ltd. India 100% 100%

Glenmark Generics Ltd. India 96.93% 98%

* held through Glenmark Holding S.A., Switzerland

** held through Glenmark Generics Ltd.

SCHEDULE 21 - NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

2. SIGNIFICANT ACCOUNTING POLICIES

i) Basis of preparation of Consolidated Financial Statements

The consolidated fi nancial statements have been prepared and presented under the historical cost convention on the

accrual basis of accounting in accordance with the accounting principles generally accepted in India and comply with

the mandatory Accounting Standards issued by the Institute of Chartered Accountants of India to the extent applicable.

The Consolidated Financial statements have been prepared using uniform accounting policies for like transactions and other

events in similar circumstances and are presented to the extent possible in the same manner as the Company’s separate

fi nancial statements. However, it was not practicable to use uniform accounting policies for depreciation in the case of

following subsidiaries:



Rs. in (‘000s)

Gross Block as on

31st March, 2010

Percentage of

Total Assets

Glenmark Pharmaceuticals S.A. 457,872 2.10% Premises 20% Vehicles 40% Laboratory Instruments and Equipments 40%Glenmark Pharmaceuticals South Africa (Pty) Ltd. 598 0.00% Computer Software 50%Glenmark Philippines Inc. 18,107 0.08% Vehicles 33% Equipments 33% Furniture and fi xtures 20%Glenmark Pharmaceuticals (Australia) Pty Ltd. 136 0.00% Equipments 25% to 40%Glenmark Generics Inc. 57,610 0.26% Leasehold Improvement 12.5% Furniture and fi xtures 14%Glenmark Generics (Europe) Ltd. 13,701 0.06% Equipments 25%

The Consolidated Financial Statements have been prepared on the following basis :

(a) In respect of Subsidiary Companies, the fi nancial statements have been consolidated on a line-by-line basis by adding

together the book values of like item of assets, liabilities, incomes and expenses, after fully eliminating intra-group

balances and unrealised profi ts/losses on intra-group transactions as per Accounting Standard - AS 21 “Consolidated

Financial Statements”. In case of Joint Venture Companies, the fi nancial statements have been consolidated as per

Accounting Standard (AS – 27) “Financial Reporting of Interests in Joint Ventures”.

(b) The excess of cost to the Company of its investment in the Subsidiary Company over the Company’s share of net assets

of the subsidiary company is recognised in the fi nancial statements as Goodwill, which is tested for impairment, if any,

at each balance sheet date. The excess of Company’s share of net assets of the subsidiary company over the cost of

acquisition is treated as Capital Reserve.

(c) The results of operations of a subsidiary are included in the Consolidated Financial Statements from the date on which

the parent-subsidiary relationship comes into existence.

(d) The translations of fi nancial statements into Indian Rupees relating to non-integral foreign operations have been carried

out using the following procedures :

- assets and liabilities have been translated at closing exchange rates at the year end; and

- income and expenses have been translated at an average of monthly exchange rates.

The resultant translation exchange gain/(loss) has been disclosed as Exchange Fluctuation Reserve under Reserves and

Surplus.

(e) The Notes and Signifi cant Accounting Policies to the Consolidated Financial Statements are intended to serve as a guide

for better understanding of the Group’s position. In this respect, the Group has disclosed such notes and policies, which

represent the requisite disclosure.

ii) Fixed Assets (including Intangibles), Depreciation and Amortisation

Fixed assets are stated at cost less accumulated depreciation and amortisation. The Group capitalises all costs relating to the

acquisition and installation of fi xed assets. Expenditure of revenue nature, incurred in setting up of new projects, is capitalised

as an indirect cost towards construction of the fi xed assets.

Depreciation is provided using the straight line method, pro-rata to the period of use of assets, based on the useful lives of fi xed

assets as estimated by management, or at the rates specifi ed in Schedule XIV of the Companies Act, 1956, whichever is higher.

Brands/IP Rights are amortised from the month of products launch/commercial production, over the estimated economic life

not exceeding 10 years.

Fixed assets having aggregate cost of Rs. 5,000 or less are depreciated fully in the year of acquisition.


The Group has estimated the useful life of its assets as follows:

Category Estimated useful life (in years)

Plant and machinery 8 - 20

Vehicles 5 - 6

Equipments and Air Conditioners 4 - 20

Furniture and Fixtures 10

Computer Software 5

Brands 5 - 10

Leasehold land and improvement is amortised over the period of lease.

iii) Borrowing Costs

Borrowing costs that are attributable to the acquisition and construction of a qualifying asset are capitalised as a part of the

cost of the asset. Other borrowing costs are recognised as an expense in the year in which they are incurred.

iv) Impairment of Assets

The Group assesses at each Balance Sheet date whether there is any indication that an asset may be impaired. If any such

indication exist, the Group estimates the recoverable amount of the asset. If such recoverable amount of the asset or the

recoverable amount of the cash generating unit to which the asset belongs is less than its carrying amount, the carrying

amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognised in the Profi t and

Loss Account. If at the Balance Sheet date there is an indication that if a previously assessed impairment loss no longer exist,

the recoverable amount is reassessed and the asset is refl ected at the recoverable amount.

v) Foreign Currency Transactions

(a) Foreign currency transactions are recorded at the exchange rates prevailing on the date of such transactions. Monetary

assets and liabilities as at the Balance Sheet date are translated at the rates of exchange prevailing at the date of the

Balance Sheet. Gain/loss arising on account of diff erences in foreign exchange rates on settlement/translation of

monetary assets and liabilities are recognised in the Profi t and Loss Account. Non-monetary foreign currency items are

carried at cost.

(b) Gain/loss on account of foreign exchange fl uctuation in respect of liabilities in foreign currencies specifi c to acquisition

of fi xed assets are recognised in the Profi t and Loss Account.

vi) Investments

Long-term investments are stated at cost. Provision, where necessary, is made to recognize a decline, other than temporary, in

the value of the investments.

vii) Inventories

Inventories of fi nished goods, consumable store and spares are valued at cost or net realisable value, whichever is lower. Cost

of raw materials and packing materials is ascertained on a fi rst-in-fi rst-out basis. Cost of work-in-process and fi nished goods

include the cost of materials consumed, labour and manufacturing overheads. Excise and customs duty accrued on production

or import of goods, as applicable, is included in the valuation of inventories. Net realisable value is the estimate of the selling

price in the ordinary course of the business.

viii) Employee Benefi ts

Long-term Employee Benefi ts

In case of Defi ned Contribution plans, the Company’s contributions to these plans are charged to the Profi t and Loss Account

as incurred. Liability for Defi ned Benefi t plans is provided on the basis of valuations, as at the Balance Sheet date, carried

out by an independent actuary. The actuarial valuation method used for measuring the liability is the Projected Unit Credit

method. The estimate of future salary increases considered takes into account the infl ation, seniority, promotion and other

relevant factors. The expected rate of return of plan assets is the Company’s expectation of the average long-term rate of return

expected on investments of the fund during the estimated term of the obligations. Plan assets are measured at fair value as at

the Balance Sheet date.

ix) Revenue Recognition

The Group recognises revenue on despatch of goods to customers. Revenues from services are recognized on completion of

such services. Revenue from IP asset/Marketing rights is recognized on transfer of ownership/right to use in accordance with

the terms of relevant agreements. Revenue from contract research being in the nature of product development activities is

recognized as per the terms of the agreement. Revenues are recorded at invoice value, inclusive of excise duty and sales-tax,

but net of returns and trade discounts.



x) Research and Development

Capital expenditure on Research and Development (R & D) is capitalised as fi xed assets. Development cost relating to the new

and improved product and/or process development is recognised as an intangible asset to the extent that it is expected that

such asset will generate future economic benefi ts. Other research and development costs are expensed as incurred.

xi) Taxation

Current Tax

Current tax is determined as the amount of tax payable in respect of taxable income for the year.

Deferred Tax

Deferred tax is recognised, subject to the consideration of prudence, on timing diff erences being the diff erence between

taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent

period. Deferred tax assets are not recognised on unabsorbed depreciation and carry forward of losses unless there is virtual

certainty that suffi cient future taxable income will be available against which such deferred assets can be realised.

Deferred tax assets/liabilities recognised as above is after excluding the amounts, which are getting reversed during the tax

holiday period.

xii) Leases

Finance Leases

Assets acquired under fi nance lease are recognised as assets with corresponding liabilities in the Balance Sheet at the inception

of the lease at amounts equal to lower of the fair value of the leased asset or at the present value of the minimum lease

payments. These leased assets are depreciated in line with the Group’s policy on depreciation of fi xed assets. The interest is

allocated to periods during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the

liability for each period.

Operating Leases

Lease rent in respect of assets taken on operating lease are charged to the Profi t and Loss Account as per the terms of lease

agreements.

xiii) Employee Stock Option Schemes (ESOS)

The Company accounts for compensation expense under the Employee Stock Option Schemes using the intrinsic value

method as permitted by the Guidance Note on “Accounting for Employee Share-based Payments” issued by the Institute of

Chartered Accountants of India. The diff erence between the market price and the exercise price as at the date of the grant is

treated as compensation expense and charged over the vesting period.

xiv) Provisions and Contingent Liabilities

The Group recognises a provision when there is a present obligation as a result of a past event that probably requires an

outfl ow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability

is made when there is a possible obligation or a present obligation that may, but probably will not, require an outfl ow of

resources. Where there is a possible obligation or a present obligation that the likelihood of outfl ow of resources is remote, no

provision or disclosure is made.

3. CONTINGENT LIABILITIES NOT PROVIDED FOR

Rs. in (‘000s)

2010 2009

(a) Bank guarantees 74,147 71,532

Disputed Income Tax/Excise Duty/Sales Tax 33,249 33,769

Claims against the Company not acknowledged as debts (Refer Note i) 386 380

Open letters of credit (Refer Note ii) 141,615 92,726

Sundry debtors factored with recourse option (Refer Note iii) 3,911,451 2,800,000

Guarantees for Rent 7,691 7,689

Indemnity Bond 345,366 331,876

Corporate Guarantee (USD 27 million) 1,218,780 1,376,460

Note:

i) In respect of labour/industrial disputes.

ii) The total amount related to LC outstanding as on 31st March, 2010.

iii) The amount related to Credit facilities given by Bank against debtors.

(b) Estimated amount of contracts remaining to be executed on capital account, net of advances, not provided for as at

31st March, 2010 aggregate Rs. 430,447 (2009 - Rs. 271,734).



4. During the year, the Company subscribed to 71,510,000 equity shares for a consideration of Rs. 7,151,000 (‘000) in its subsidiary

Glenmark Generics Limited for the balance Business sale consideration.

5. EARNINGS PER SHARE

Basic earnings per share is calculated by dividing the net profi t for the year attributable to equity shareholders by the weighted

average number of equity shares outstanding during the year.

For the purpose of calculating diluted earnings per share, the weighted average number of shares outstanding are adjusted for the

eff ects of all dilutive potential equity shares from the exercise of options on unissued share capital and on conversion of FCC Bonds.

The calculations of earnings per share (basic and diluted) are based on the earnings and number of shares as computed below.

Rs. in (‘000s)

31st March, 2010 31st March, 2009

Profi t after tax and Minority Interest (attributable to equity shareholders) 3,244,708 1,916,637

In (‘000s)

Reconciliation of number of shares No. of Shares No. of Shares

Weighted average number of shares:

For basic earnings per share 260,759 250,025

Add:

Deemed exercise of options on unissued equity share capital and

Conversion of FCC Bonds

565 5,237

For diluted earnings per share 261,324 255,262

Earnings per share (nominal value Re. 1 each) Rs. Rs.

Basic 12.4 7.7

Diluted 12.4 7.5

6. FOREIGN CURRENCY CONVERTIBLE BOND ISSUED

A) The Company had issued 30,000 Zero Coupon Foreign Currency Convertible Bonds of USD 1,000 each (Rs. 1,331,700 at issue)

(i) Convertible at the option of the bondholder at any time on or after 11th November, 2007 but prior to the close of

business on 29th November, 2010 at a fi xed exchange rate of Rs. 44.94 per 1 USD and the conversion price of Rs. 582.60

per share of Re. 1 each.

(ii) Redeemable in whole but not in part at the option of the Company on or after 10th January, 2010 if closing price of the

share for each of the 25 consecutive trading days immediately prior to the date upon which notice of such redemption

is given was atleast 130% of the applicable Early Redemption Amount divided by the Conversion Ratio.

(iii) Redeemable on maturity date on 11th January, 2011 at 139.729% of its principal amount if not redeemed or converted

earlier. The redemption premium of 39.729% payable on maturity of the bond if there is no conversion of the bond

to be debited to Securities Premium Account evenly over the period of 5 years from the date of issue of bonds. As of

31st March, 2010, 30,000 FCC bonds (2009 - 30,000) of USD 1,000 each aggregating to USD 30 million are outstanding.

B) The Company had issued 20,000 Zero Coupon Foreign Currency Convertible Bonds of USD 1,000 each (Rs. 873,200 at issue)

(i) Convertible at the option of the bondholder at any time on or after 28th March, 2005 but prior to the close of business on

2nd January, 2010 at a fi xed exchange rate of Rs. 43.66 per 1 USD and price of Rs. 215.60 (Post adjustment for bonus and

split) per share of Re. 1 each.

(ii) Redeemable in whole but not in part at the option of the Company on or after 15th February, 2008 if closing price

of the Share for each of the 25 consecutive trading days immediately prior to the date upon which notice of such

redemption is given was atleast 130% of the applicable Early Redemption Amount divided by the Conversion Ratio.

(iii) Redeemable on maturity date on 16th February, 2010 at 133.74% of its principal amount if not redeemed or converted

earlier. The redemption premium of 33.74% payable on maturity of the Bond if there is no conversion of the Bond to

be debited to Securities Premium Account evenly over the period of 5 years from the date of issue of Bonds. During

the year, 1,000 FCC Bonds of USD 1,000 each aggregating to USD 1 Million were redeemed on 16th February, 2010 on

maturity. As of 31st March, 2010, NIL FCC Bonds (2009 - 1,000) of USD 1,000 each are outstanding.

C) The Company had issued 50,000 Zero Coupon Foreign Currency Convertible Bonds of USD 1,000 each (Rs. 2,183,000 at issue)

(i) Convertible at the option of the bondholder at any time on or after 15th November, 2006 but prior to the close of business

on 2nd January, 2010 at a fi xed exchange rate of Rs. 43.66 per 1 USD and the price of Rs. 253.11 (post adjustment for split)


(ii) Redeemable in whole but not in part at the option of the Company on or after 15th February, 2009 if closing price of the

share for each of the 25 consecutive trading days immediately prior to the date upon which notice of such redemption is

given was atleast 130% of the applicable Early Redemption Amount divided by the Conversion Ratio.




earlier. The Redemption Premium of 34.07% payable on maturity of the Bond if there is no conversion of the Bond to

be debited to Securities Premium Account evenly over the period of 5 years from the date of issue of Bonds. During

the year, 5,000 FCC Bonds of USD 1,000 each aggregating to USD 5 Million were redeemed on 16th February, 2010 on

maturity. As of 31st March, 2010, NIL FCC Bonds (2009-5000) of USD 1,000 each are outstanding.

7. SEGMENT INFORMATION

Business segments

The Group is primarily engaged in a single segment business of manufacturing and marketing of pharmaceutical formulations and

active pharmaceutical ingredients and is governed by a similar set of risks and returns.

Geographical segments

In the view of the management, the Indian and export markets represent geographical segments.

Sales by market – The following is the distribution of the Company’s sale by geographical market:

Rs. in (‘000s)

2009-2010 2008-2009

Geographical segment

India 8,767,083 7,155,326

Other than India* 16,239,383 14,005,006

TOTAL 25,006,466 21,160,332

Assets and additions to fi xed assets by geographical area – The following table shows the carrying amount of segment assets and

additions to fi xed assets by geographical area in which the assets are located:

Rs. in (‘000s)

India

2009-2010

Others*

2009-2010

India

2008-2009

Others*

2008-2009

Carrying amount of segment assets 17,886,600 30,386,073 16,077,552 26,011,583

Additions to fi xed assets 1,459,979 2,176,068 1,620,088 7,707,675

* Others represent receivables from debtors located outside India including those related to deemed exports and cash and bank

balances of branches outside India.

8. RELATED PARTY DISCLOSURES

In accordance with the requirements of Accounting Standard - 18 “Related Party Disclosures”, the names of the related parties where

control exists and/or with whom transactions have taken place during the year and description of relationships, as identifi ed and

certifi ed by the Management are as follows:

a) Key Management Personnel

Mr. Gracias Saldanha

Mrs. B. E. Saldanha

Mr. Glenn Saldanha

Mrs. Cheryl Pinto

Mr. R. V. Desai

Mr. A. S. Mohanty

b) Transactions with related parties during the year

Rs. in (‘000s)

2009-2010 2008-2009

Managerial Remuneration

Name of Directors

1. Mr. Gracias Saldanha 120 25,882

2. Mrs. B. E. Saldanha 60 40

3. Mr. Glenn Saldanha 18,282 34,093

4. Mrs. Cheryl Pinto 9,409 15,011

5. Mr. R. V. Desai - 9,190

6. Mr. A. S. Mohanty 8,202 11,213



9. LEASES

a) The Group has entered into operating and fi nance lease agreements for the rental of property, vehicles, computers, equipments

and other assets. Typically, lease agreements are for a period of three to fi fteen years.

As at 31st March, 2010, the Group had commitments under non-cancellable fi nance leases as follows:

Rs. in (‘000s)


Minimum lease payments

Due within one year 53,104 10,355

Due later than one year and not later than fi ve years 34,897 27,345

Due later than fi ve years 36,330 33,141

Total 124,331 70,841

Present value of minimum lease payments



Due later than fi ve years 23,039 20,233

Total 103,261 53,254

b) Glenmark Generics Inc., USA (GGI) conducts its operations from facilities that are leased under a 97-month non-cancellable

operating lease expiring in September 2013. Additional offi ce space were subleased under a 52-month non-cancellable

operating lease which expired in September 2008.

Glenmark Pharmaceuticals South Africa (PTY) Limited has entered into operation lease agreement for the rental of its offi ce

premises. The lease agreement is for a period of 5 years.

Glenmark Philippines Inc. has entered into operating lease agreements for the rental of its warehouse and offi ce premises. The

lease agreement is for a period of 4 years.

Glenmark Pharmaceuticals SP z.o.o. has entered into operating lease agreements for the rental of its offi ce premises for a period

of 3 to 5 years.

Rs. in (‘000s)


Minimum lease payments



Due later than fi ve years - 21,674

Total 136,945 258,173

c) The Group has taken on lease/leave and licence godowns/residential & offi ce premises at various locations.

i) The Group’s signifi cant leasing arrangements are in respect of the above godowns & premises (Including furniture and

fi ttings therein, as applicable). The aggregate lease rentals payable are charged to Profi t and Loss Account as Rent.

ii) The Leasing arrangements which are cancellable range between 11 months and 5 years. They are usually renewable by

mutual consent on mutually agreeable terms. Under these arrangements, generally refundable interest free deposits

have been given. An amount of Rs. 83,911 (2009 - Rs. 78,559) towards deposit and unadjusted advance rent is recoverable

from the lessor.

10. EMPLOYEE BENEFITS

The disclosures as required as per the revised AS 15 are as under:

1. Brief description of the Plans

The Group has various schemes for long-term benefi ts such as Provident Fund, Superannuation, Gratuity, Pension Fund, Social

Securities and Leave Encashment. In case of funded schemes, the funds are recognised by the Income tax authorities and

administered through appropriate authorities. The Group's defi ned contribution plans are Superannuation and Employees'

Provident Fund and Pension Scheme since the Company has no further obligation beyond making the contributions. The

Group's defi ned benefi t plans include Gratuity and Leave Encashment.



2. Charge to the Profi t and Loss Account based on contributions:

Rs. in (‘000s)

2009-10 2008-09

Superannuation 2,331 2,326

Provident Fund, Pension Fund and Social Securities 165,351 129,087

167,682 131,413

3. Disclosures for defi ned benefi t plans based on actuarial reports as on 31st March, 2010:

Rs. in ('000s)

2009-2010 2008-2009

Gratuity

(Funded plan)

Leave

Encashment

(Funded plan)

Gratuity

(Funded plan)

Leave

Encashment

(Funded plan)

(i) Change in Defi ned Benefi t Obligation

Opening defi ned benefi t obligation 121,429 68,839 103,127 48,330

Current service cost 20,086 16,881 15,036 15,079

Interest cost 9,112 4,873 7,710 3,169

Actuarial loss/(gain) 2,549 12,075 5,095 13,209

Benefi ts paid (8,720) (15,062) (9,539) (10,948)

Closing defi ned benefi t obligation 144,456 87,606 121,429 68,839

(ii) Change in Fair Value of Assets

Opening fair value of plan assets 117,459 35,271 76,559 29,790

Expected return on plan assets 10,815 2,506 8,152 2,422

Actuarial gain/(loss) 3,628 789 (4,781) 91

Contributions by employer 10,117 20,019 47,067 13,917

Benefi ts paid (8,720) (15,062) (9,539) (10,949)

Closing fair value of plan assets 133,299 43,523 117,458 35,271

(iii) Reconcilation of Present Value of Defi ned Benefi t

Obligation and the Fair Value of Assets

Present Value of Funded Obligation as at end of the

year

144,456 87,607 121,429 68,839

Fair Value of Plan Assets as at end of the year (133,299) (43,523) (117,458) (35,271)

Funded Liability/(Asset) recognised in the Balance Sheet 11,157 44,084 3,971 33,568

Present Value of Unfunded Obligation as at end of the

year

- - - -

Unrecognised Actuarial Gain/(Loss) - - - -

Unfunded Liability/(Asset) recognised in the Balance Sheet - - - -

(iv) Amount recognised in the Balance Sheet

Present value of obligations as at year end 144,456 87,607 121,429 68,839

Fair value of plan assets as at year end (133,299) (43,523) (117,458) (35,271)

Amount not recognised as an asset - - - -

Net (asset)/liability recognised as on 31st March, 2010 11,157 44,084 3,971 33,568

(v) Expenses recognised in the Profi t and Loss Account


Interest on defi ned benefi t obligation 9,112 4,873 7,710 3,169

Expected return on plan assets (10,815) (2,506) (8,152) (2,422)

Net actuarial loss/(gain) recognised in the current year (1,079) 11,286 9,876 13,118

Total expense 17,304 30,534 24,470 28,944

(vi) Actual Return on Plan Assets


Actuarial gain/(loss) on Plan Assets 3,628 789 (4,781) 91

Actual Return on Plan Assets 14,443 3,295 3,371 2,513

(vii) Asset information

Administered by Birla Sunlife Insurance Co. Ltd.

and LIC of India

100% 100% 100% 100%



2009-2010 2008-2009

Gratuity

(Funded plan)

Leave

Encashment

(Funded plan)

Gratuity

(Funded plan)

Leave

Encashment

(Funded plan)

(viii) Principal actuarial assumptions used

Discount rate (p.a.) 8% 8% 7.5%-8% 7.5%-8%

Expected rate of return on plan assets (p.a.) 8%-9% 8%-9% 8%-9% 8%-9.25%

(ix) Experience Analysis

Actuarial gain/(loss) on change in assumptions 6,297 (1,922) - -

Experience (Gain)/Loss on Liabilities (3,748) 13,997 - -

Actuarial gain/(loss) on Obligation 2,549 12,075 - -

(x) Expected employer’s contribution for the next year is Rs. 29,351 ('000) for Gratuity and Leave Encashment.

11. “As per the transitional provision given in the notifi cation issued by Ministry of Corporate Aff airs dated 31st March, 2009 the Group

has opted for the option of adjusting the exchange diff erence on long term foreign currency monetary items:

i) To the cost of the assets acquired out of this foreign currency monetary item. During the year, the Group has decapitalised

exchange diff erence amounting to Rs. 105.46 lakhs on restatement of long-term loans used for acquiring the fi xed assets.

ii) To the Foreign Currency Monetary Item Translation Diff erence account. During the year, the Group has transferred exchange

gain of Rs. 6,452.75 lakhs on restatement of long-term loans. Accordingly, proportionate amount of Rs. 2,023.62 lakhs is

amortised and Depreciation charged of Rs. 17.04 lakhs for the year ended 31st March, 2010. Due to the above profi t for the year

is lower by Rs. 4,551.64 lakhs.”

12. Extracts of Assets and Liabilities as on 31st March, 2010 and Income and Expenses for the year ended 31st March, 2010 related to the

interest of the Company [without elimination of the eff ect of transactions between the Company and Glenmark Pharmaceuticals

(Thailand) Co. Ltd., Thailand] have been extracted from the audited accounts.

Rs. in (‘000s)

Particulars 2009-2010 2008-2009

Assets

Net Fixed Assets including CWIP 5 -

Deferred Tax Asset 236 52

Cash Bank Balances 1,029 1,114

Loans and Advances 57 59

Liabilities

Current Liabilities 144 66

Income

Net Sales - -

Expenses

Selling and Operating expenses 1,269 325

Depreciation 1 -

Provision for Taxation including Deferred Tax (191) (49)

13. PRIOR YEAR COMPARATIVES

Prior year’s fi gures have been regrouped or reclassifi ed wherever necessary to confi rm to current year’s classifi cation.

Rs. in ('000s)

Signatures to the Schedules 1 to 21 which form an integral part of the Financial Statements.











Profi les of Directors

Mr. Gracias Saldanha (Chairman)

Mr. Gracias Saldanha, 72, is the founder of the Company. He

has over 38 years experience in the industry. His educational

qualifi cations include a M.Sc. from Bombay University with a

Diploma in Management Studies from Jamnalal Bajaj Institute

of Management Studies, Mumbai. He has worked with leading

pharmaceutical companies like Abbott Laboratories and E. Merck.

Mr. Glenn Saldanha (Managing Director & CEO)

Mr. Glenn Saldanha, 40, is a B.Pharm from Bombay University

and was awarded the Watumall Foundation Award for overall

excellence. His other educational qualifi cations include an MBA

from New York University’s Leonard N. Stern School of Business

(US). He has worked for Eli Lilly in the US and was a Management

Consultant with Price Waterhouse Coopers. His services have been

used by Smithkline Beecham, Rhorer, Astra, Merck and Johnson

and Johnson, among others.

Mr. A. S. Mohanty (Director – Corporate Communications & CSR)

Mr. A. S. Mohanty, 56, is M.Sc., and looks after Corporate

Communications & CSR activities. He has over 32 years experience

in pharmaceutical sales and marketing as well as healthcare

sectors.

Mr. N. B. Desai (Non-Executive Director)

Mr. N. B. Desai, 83, is a retired General Manager of Bank of Baroda.

He has over 46 years experience in the Banking Sector. He has

worked in India and overseas. He was Chairman of Bank of Baroda

Uganda Ltd. He was the founder and Managing Director of

Equitorial Bank PLC, UK from which he retired in 1992.

Mr. Sridhar Gorthi (Non-Executive Director)

Mr. Sridhar Gorthi, 38 is a B.A., L.L.B., (Hons.) from the National

Law School of India University. Mr. Sridhar Gorthi is presently a

partner in Trilegal and has worked with Arthur Anderson and Lex

Inde, Mumbai. He is involved in legal advisory services to various

multinational and domestic corporations on restructuring, debt

fi nance, joint ventures, acquisition/mergers etc.

Mr. D. R. Mehta (Non-Executive Director)

Mr. D. R. Mehta, 73, has graduated in Arts and law from

Rajasthan University. He also studied at Royal Institute of Public

Administration, London, UK and the Alfred Sloan school of

Management, Boston, U.S.A. He has over 40 years experience in

civil services and has held various positions in the Government of

Rajasthan and Government of India. He was the Deputy Governor

of Reserve Bank of India and also the chairman of the Securities

and Exchange Board of India.

Mrs. Cheryl Pinto (Director - Corporate Aff airs)

Mrs. Cheryl Pinto, 43, is a graduate in Pharmacy from the

University of Bombay. She has over 22 years experience in the

pharmaceuticals business.

Mrs. B. E. Saldanha (Non-Executive Director)

Mrs. B. E. Saldanha, 70, has graduated in B.Sc., B.Ed., from Bombay

University and was a Whole-time Director of the Company from

1982 to 2005. She was responsible to a large extent in developing

the Company’s export business.

Mr. Julio F. Ribeiro (Non-Executive Director)

Mr. Julio F. Ribeiro, 81, is a retired government offi cial and has

served the country under various assignments. Amongst the

major positions held, he has been the Ex-commissioner of Police,

Mumbai, former Special Secretary to Government of India,

Ministry of Home Aff airs, former Director General of Police, Punjab,

Ex-Adviser to the Governor of Punjab, Ex-Ambassador of India to

Romania.

Mr. Hocine Sidi Said (Non-Executive Director)

Mr. Hocine Sidi Said, 45, has graduated in B.A (International

Marketing). He is the Founder & Director of Bio-nAbler, an

investment company that partners with Sovereign Wealth Funds

and Private Equity Firms across Asia and the MENA region to

identify and execute product and company acquisitions. He has

over 20 years of experience in the pharmaceuticals industry and

has worked with companies like Pfi zer and UCB. During his stint

at UCB, he was incharge of the entire Emerging Markets Region

and designated as Senior Vice President. Prior to joining UCB, he

spent close to 17 years with Pfi zer in various senior management

and developmental roles in the Middle East, Central and Eastern

Europe and Asia.


Directors’ Report

Your Directors have pleasure in presenting their 32nd Annual Report and Audited Accounts of the Company for the year ended 31st March,

2010.

FINANCIAL RESULTS

(Rs. in Millions)

Standalone Consolidated

2009-2010 2008-2009 2009-2010 2008-2009

Profi t before Interest, Depreciation & Tax 1724.50 3206.13 6685.29 6289.95

Less: Interest 301.58 551.39 1640.21 1404.76

Less: Depreciation 212.78 191.04 1206.10 1026.83

Less: Tax (Current Year & Deferred Tax) (74.49) 281.46 528.66 754.08

Less: Exceptional Items - 2.98 - 1169.55

Profi t after Tax 1284.63 2179.26 3310.32 1934.73

Share of (Profi t)/Loss of Minority Interest - - (65.61) (18.09)

Profi t after Tax and Minority Interest 1284.63 2179.26 3244.71 1916.64

Surplus brought forward from earlier years 7480.98 5636.88 11215.45 10276.66

Profi t available for appropriations 8765.61 7816.14 14460.16 12193.30

APPROPRIATIONS

Proposed Dividend on Equity Shares 107.94 100.21 107.94 100.21

Tax on Proposed Dividend on Equity Shares 17.93 17.03 17.93 17.03

Transfer to Foreign Currency Monetary Item Translation Diff erence

Account - - - 366.12

Residual Dividend and Dividend Tax 0.16 - 0.16 -

Transfer to General Reserves 128.46 217.93 128.46 494.49

Balance carried to Balance Sheet 8511.12 7480.97 14205.67 11215.45

8765.61 7816.14 14460.16 12193.30

DIVIDEND

Your Directors recommend a Dividend of 40% (Re. 0.40 per equity

share of Re. 1/ each) to be appropriated from the profi ts of the year

2009-10 subject to the approval of the members at the ensuing

Annual General Meeting. The dividend will be paid in compliance

with applicable regulations. The dividend, if approved, will result

in an outfl ow of Rs. 125.87 million (including dividend tax).

CONSOLIDATED ACCOUNTS

In accordance with the requirements of Accounting Standard

AS-21 prescribed by the Institute of Chartered Accountants of

India, the Consolidated Accounts for the year ended 31st March,

2010, under Indian GAAP forms part of the Annual Report.

RESULTS OF OPERATIONS

The Company achieved consolidated Gross revenue of

Rs. 25006.47 million (Rs. 21160.33 million) registering a growth of

18.18% over the previous year and the Consolidated operating

profi t before interest, depreciation and tax was Rs. 6685.29 million

as compared to Rs. 6289.95 million in the previous year.

On standalone basis the company achieved a gross revenue of

Rs. 10296.87 million and the Standalone operating profi t before

interest, depreciation & tax was Rs. 1724.50 million as compared

to Rs. 3206.13 million in the previous year.

CHANGES IN CAPITAL STRUCTURE

Issue of shares on exercise of Employees’ Stock Options:

During the year, the Company allotted 604,860 Equity Shares of

Re. 1/- each (on pari-passu basis) pursuant to exercise of Stock

Options by the eligible employees of the Company and its

subsidiaries.

Issue of shares under QIP:

During the year, the Company allotted 18,712,935 Equity Shares

of Re. 1/- each at a premium of Rs. 220/- per share to Qualifi ed

Institutional Buyers pursuant to Chapter VIII of the Securities

Exchange Board of India (Issue of Capital Disclosure Requirements)

Regulations 2009. The issue proceeds were utilised towards

repayment of debts.

EMPLOYEE STOCK OPTION SCHEME

During the year, Stock Options have been issued to the employees

of the Company. On exercising the convertible options so granted,

the paid-up equity share capital of the company will increase by a


The details of stock options granted by the Company are disclosed in

compliance with clause 12 of the Securities Exchange Board of India

(Employee Stock Options Scheme and Employee Stock Purchase

Scheme), 1999 and set out in the Annexure-B to this Report.

LISTING AT STOCK EXCHANGES

The Equity shares of the Company continue to be listed on

Bombay Stock Exchange Ltd., and The National Stock Exchange

of India Ltd. Foreign Currency Convertible Bonds are listed on the

Singapore Stock Exchange.

SUBSIDIARY COMPANIES

During the year the name of Badatur S.A. was changed to

Glenmark Uruguay S.A. and Glenmark Dominicana S.A. to


Glenmark Dominicana, SRL. The Company has also incorporated a

subsidiary i.e. Glenmark Generics B.V., Netherlands.

Pursuant to the provisions of Section 212 (8) of the Companies

Act, 1956, the Company has obtained exemption from Ministry of

Corporate Aff airs, New Delhi, vide its letter No. 47/420/2010-CL-III

dated 28th June, 2010 to attach Audited Accounts of its subsidiaries

together with Directors’ Report and Auditor’s Report. The Audited

Accounts of the subsidiaries together with its Directors’ Report

and Auditor’s Report are available for inspection of members on

any working day at the Corporate Offi ce of the Company between

11 a.m. to 1 p.m.

DIRECTORS

Mr. Glenn Saldanha, Mr. Sridhar Gorthi and Mr. J. F. Ribeiro retire

by rotation at the ensuing Annual General Meeting and being

eligible, off er themselves for re-appointment.

Mr. M. Gopal Krishnan resigned as Director of the Company

w.e.f. 29th January, 2010. Your Directors wish to place on record

their sincere appreciation of the valuable contribution made by

Mr. Gopal Krishnan during his tenure on the Board.

Mr. Hocine Sidi Said has been appointed as Additional Director

w.e.f. 29th October, 2009. He holds offi ce as Director upto the date

of the ensuing Annual General Meeting. Notice has been received

from a member of the Company pursuant to the provisions of

Section 257 of the Companies Act, 1956 signifying his intention

to appoint Mr. Hocine Sidi Said as Director on the board of the

Company.

CORPORATE GOVERNANCE

Report on the Corporate Governance forms an integral part of

this Report. The Certifi cate of the Practicing Company Secretary

certifying compliance with the conditions of Corporate

Governance as stipulated in clause 49 of the Listing Agreement

with Stock Exchanges is annexed with the report on Corporate

Governance.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The management discussion and analysis report on the operations

of the company, as required under the Listing agreements with

the stock exchanges is provided in a separate section and forms a

part of this report.

AUDITORS

M/s. Price Waterhouse, Chartered Accountants, have been the

Statutory Auditors of the Company since F.Y. 2002-03. The Audit

Committee and the Board of Directors have decided that in

order to adhere to the best Corporate Governance practices, the

Statutory Auditors should be changed periodically on rotational

basis. The Company has received a Special Notice pursuant to

Section 225 of the Companies Act, 1956 from a member proposing

to move a resolution for the appointment of Walker, Chandiok &

Co. Chartered Accountants, as Statutory Auditors of the Company

in place of the retiring auditors, M/s. Price Waterhouse at the

ensuing Annual General Meeting.

Your Directors propose the appointment of Walker, Chandiok &

Co., Chartered Accountants, as Statutory Auditors of the Company

at the ensuing Annual General Meeting.

Walker, Chandiok & Co. is a member fi rm of M/s Grant Thornton

who is a leading international fi rm rated among the top 10 fi rms.

They have a large international network and would be helpful and

useful to the Company in managing its international operations.

They have representations on various Accounting Board &

committees in India and cater to leading companies.

HUMAN RESOURCES

Company’s industrial relations continued to be harmonious

during the year under review.

PARTICULARS OF EMPLOYEES

Information as required under the provisions of Section 217(2A)

of the Companies Act, 1956 read together with the Companies

(particulars of Employees) Rules, 1975, as amended, are given in

an Annexure forming part of this report.

CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT,

TECHNOLOGY ABSORPTION, FOREIGN EXCHNAGE EARNINGS AND

OUTGO

The particulars as prescribed under 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 are set

out in the Annexure-A to this Report.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to Section 217(2AA) of the Companies Act, 1956, the

directors confi rm that –

(i) in the preparation of the annual accounts, the applicable

accounting standards have been followed along with

proper explanation relating to material departures, if any;

(ii) appropriate accounting policies have been selected and

applied consistently and have made judgments and

estimates that are reasonable and prudent so as to give a

true and fair view of the state of aff airs of the Company as

at 31st March, 2010 and of the profi t of the Company for the

year ended 31st March, 2010;

(iii) proper and suffi cient care has been taken for maintenance

of adequate accounting records in accordance with the

provisions of the Companies Act, 1956 for safeguarding the

assets of the Company and for preventing and detecting

fraud and other irregularities;

(iv) the annual accounts have been prepared on a going concern

basis.

APPRECIATION AND ACKNOWLEDGEMENTS

Your Directors express their gratitude to the Company’s customers,

shareholders, business partner’s viz. distributors and suppliers,

medical profession, Company’s bankers, fi nancial institutions

including investors for their valuable sustainable support and

Co-operation.

Your Directors commend the continuing commitment and

dedication of employees at all levels.

For and on behalf of the Board of Directors

G. Saldanha

Chairman

Mumbai

Date: 9th August, 2010


ANNEXURE-A

Information under Section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of the Board

of Directors) Rules, 1988 and forming part of the Directors’ Report.

A. CONSERVATION OF ENERGY

Energy Generation Measures Taken

A. Power and Fuel Consumption 2009-10 2008-09

1. Electricity

(a) Purchased

Unit (in ‘000 Kwhrs) 7995.98 6210.77

Total Amount (Rs. in ‘000s) 35385.00 27587.12

Rate/Unit (Rs.) 4.43 4.44

(b) Own Generation

i) Through Diesel Generator

Unit (in ‘000 Kwhrs) 1187.92 992.99

Units per Ltr. of Diesel Oil 3.33 3.50

Cost/Unit (Rs.) 9.51 10.64

ii) Through Steam Turbine/Generator NIL NIL

2. Coal NIL NIL

Qty.

Total Cost

Avg. Rate

3. Furnace Oil/Light Diesel Oil

Qty. (K. Ltr.) 52.40 54

Total Amount (Rs. in ‘000s) 2391.40 2395.32

Avg. Rate (Rs./K. Ltr.) 45.64 44.35

4. i) Internal generation

Light Diesel Oil

Qty. (In Ltr. ‘000’s) NIL NIL

Total Cost (Rs. in ‘000s) NIL NIL

Rate/Unit (Rs.) NIL NIL

ii) Natural Gas

Qty. (M3 ‘000s) NIL NIL

Total Cost (Rs. in ‘000s) NIL NIL

Rate/Unit (Rs.) NIL NIL

Annexures to the Directors’ Report

B. Consumption

The Company manufactures several Drug Formulations in diff erent pack sizes. In view of this, it is impracticable to apportion the consumption and cost of utilities to each Product/Formulation.

B. TECHNOLOGY ABSORPTION, RESEARCH & DEVELOPMENT(R & D)

1. Specifi c areas in which R & D is carried out by the Company and its subsidiaries and benefi ts derived as a result of the same.

Formulation Development:

a) Pharmaceutical Formulation Development:

Development of formulations as immediate release, delayed release, enteric release, sustained release and various platform technologies. This includes literature survey,

preformulation studies, formulation and standardization of dosage forms for selected drug molecules on laboratory scale.

R & D has developed the new formulations for new and existing molecules and drug combinations. Which includes its standardization and execution at production site, evaluation of these batches

against reference samples for pharmaceutical and

bio-equivalence.

The following products are ready for commercialization and

commecialized during the fi nancial year 2009-2010.

Anti infl ammatory and analgesic

1. Lornoxicam + Paracetamol Tablets (4 mg+500 mg)

(commecialized)2. Lornoxicam + Paracetamol Tablets (8 mg+500 mg)

(commecialized)


3. Lornoxicam SR Tablets 16 mg (commecialized)

4. Dexibuprofen tablets 300 mg (commecialized)

5. Dexibuprofen tablets 400 mg (commecialized)

6. Dexibuprofen + Paracetamol tablets 300 + 500 mg

(commecialized)7. Diacerein ER capsules 100 mg (Ready for

commercialization)

Anti Allergic

1. Levocetirizine + Phenylephrine capsules

(5mg + 10 mg) (commecialized)

Anti Diabetic

1. Metformin Hydrochloride Extended Release Tablets

1000 mg (Ready for commercialization)

2. Miglitol and metformin Hydrochloride SR Tablets

(25 mg + 500 mg) and (50 mg + 500 mg)

(commecialized)

Anti Asthmatic

1. Acebrophylline Capsule 100 mg (commecialized)

2. Montelukast & Levocetirizine Tablets (Ready for

commercialization)

3. Doxofylline & Salbutamol Capsules (400 + 2 & 400

+ 4) (Ready for commercialization)

Anti Hypertensive

1. Telmisartan & Metoprolol tablets (40 mg + 25 mg)

(Ready for commercialization)

2. Telmisartan & Metoprolol tablets (40 mg + 50 mg)


3. Olmesartan Tablets 40mg (commecialized)

4. Olmesartan + Hydrochlorothiazide Tablets (40 mg

+12.5 mg) (commecialized)

Hormones

1. Buserelin Injection 1 mg / ml (commecialized)

2. Cyproteronoe Acetate & Ethinyl Estradiol tablets


Anti Bacterial

1. Tigecycline Injection (commecialized)

2. Ofl oxacin and Ornidazole Tablet (commecialized)

3. Colistimethate Injection 1 Million IU (Ready for

commercialization)

Dermatology

1. Benzoyl Peroxide Gel 2.5% (Ready for

commercialization)

2. Benzoyl Peroxide Gel 5% (Ready for

commercialization)

3. Sertaconazole + Beclomethasone Dipropionate Cream


4. Hydroquinone+Tretinoin+Fluocinolone Acetonide

Cream (commecialized)

5. Clotrimazole + Beclomethaosne Dipropionate +

Lidocaine + Ofl oxacin Ear Drops (commecialized)

6. Tretinoin cream (Ready for commercialization)

Topical Solutions

1. Minoxidil 10% + Aminexil 1.5% Topical Solution


Liquid Orals

1 Levosalbutamol Sulphate + Guaiphenesin + Ambroxol

Hydrochloride Expectorant (commecialized)

2. Amantadine Hydrochloride + Paracetamol +

Phenylephrine Hydrochloride + Chlorpheniramine

Maleate Oral Solution (commecialized)

Oncology

1. Pemetrexed for Injection (commecialized)

2. Bortezomib for Injection (commecialized)

3. Erlotinib Tablets (commecialized)

NCE Formulation Development

1. Formulation Development for NCE 8200 - tablet

batch for clinical bridging study 50/100 mg

(Completed)

2. Formulation Development NCE 4039-Tablet and

capsule batches for clinical study.

3. Formulation Development NCE 10693- Preclinical

development & clinical development

4. Formulation Development NCE 15300 - Preclinical

development and clinical studies.






development.

US market

1. Omeprazole capsule 10 mg, 20 mg, 40 mg (Ready for

commercialization)

Analytical Method Development:

a) Development of new analytical test procedures for

Establishing the quality and setting up specifi cation for the

release testing of Dosage Forms and Active Pharmaceutical,

Finished Intermediates is the responsibility of Analytical

Method Development group at Glenmark R & D. These

methods are validated as per International Regulatory

Standards.

The responsibilities of this department also include the

evaluation of the stability of the products developed at

R&D under various Climatic Conditions as ICH Guidelines

of Stability. This data is used as a basis to predict the shelf

life of the products and also to prepare the stability study

protocols for the commercial products manufactured as

drug products/drug substance.

Category Method

Developed

Methods

Validated

Methods

Transferred

to the

manufacturing

Site

Oral Solid Dosages 87 46 19

Derma products 29 33 17

Oncology products 10 5 4

API 3 9 9

Documents for Drug

Substance

(STP, Specs etc.)

– – 49


In Analytical Research activities for NCE research:

a) We developed new analytical test procedures to establish

the structure and evaluate the quality of NCE prior to

initial biological screening. During pre-clinical studies,

we generated analytical data for establishing the quality

and setting up specifi cation for the release testing of

Drug substances. The methods used to release the drug

substances which are used in clinical trials, are validated as

per International Regulatory Standards.

b) We evaluated physicochemical properties of new chemical

entity; did the characterization studies, stability studies

(under various Climatic Conditions as per ICH Guidelines of

Stability).

c) CMC related Dossiers, study protocols and study reports

were prepared to support various pre-clinical studies and

clinical trial applications with Regulatory Agencies.

d) We performed polymorphic evaluation and salt selection

studies on various NCEs drug substance and drug products.

e) Reference standards of NCE were generated and supplied to

CROs and manufacturing sites.

Category Numbers

Methods developed 131

Methods Validated 3

Methods Transferred to the Manufacturing

Sites

4

Reference Standards for NCEs 9

Stability Studies 136

Developmental Studies 15

Documents for Drug Substance (Dossiers,

Specs, CoA, TTD, etc.)

413

2. Future plan of action

R & D is working on new molecules in the following segment;

- Oncology Products

- Antifungal molecules

- Antibacterial molecules

- Antiasthmatic molecules

- Antidiabetic products

- Antiaging products

- Antiinfl ammatory products

- Atihyperlipidemic products

- Antiosteoporosis products

- Antiemetic products

- Sunscreens Products

- Technology – such as microspheres & aerosols foam

Mousse.

- Technology – to replace solvents used in fi lm coating

by water.

- Development of formulations for Semi regulatory

market.

- Development of formulations for Latin American market.

- Development of formulations for US market.

- Antihypertensive molecules

- Metered dose inhaler products for India market.

- Metered dose inhaler products for Brazil market

- Development of specialized NDDS products for

Indian/SRM.

TECHNOLOGY ABSORPTION, ADOPTION AND INNOVATION:

1. Eff orts in brief towards technology absorption,

adoption and innovation.

Most of our eff orts in the area of technology

absorption, adoption and innovation are based on

our own eff orts in R & D. They include improvement

in yield and quality, improvement of processes and

development of new processes with validation

studies.

2. Benefi ts derived:

Benefi ts derived are enhanced production of our

products, improvement in the yield and quality of

products and introduction of new products, cost

reduction of products and processes without aff ecting

the quality of the products and process effi cacy.

Our R & D Centre is recognised by D.S.I.R., Ministry of

Science and Technology, Government of India.

Information regarding technology imported during

the last fi ve years – Nil.

3. Expenditure on R & D:

(Rs. in Million)

2009-10 2008-09

a) Capital Expenditure 57.98 104.46

b) Revenue Expenditure 460.56 514.58

c) Total 518.54 619.04

d) R & D Expenditure as a

percentage of total turnover

4.99% 6.41%

C. FOREIGN EXCHANGE EARNINGS AND OUTGO

1. Activities relating to exports; initiatives taken to

increase exports; development of new export markets

for products and services; and export plans. The

Management Discussion and Analysis report forming

a part of the Directors Report deals with the same.

2. Total foreign exchange earned was Rs. 2953.47 million

and outfl ow was Rs. 596.83 million.

For and on behalf of the Board of Directors

G. Saldanha

Chairman

Mumbai

Date: 9th August, 2010


Particulars

a Options granted 10,134,900

b Pricing Formula Exercise Price shall be the latest available closing market price

of the equity shares of the company, prior to the date of grant

c Options Vested** 5,764,000

d Options Exercised** 2,252,500

e Total no. of shares arising as result of exercise of Options 2,252,500

f Options lapsed * 5,248,900

g Variation in terms of Options None

h Money realised by exerise of Options (in lakhs) 952.85

i Total number of options in force** 2,633,500

** The number of options have been reported as on 31.03.2010

* Lapsed Options includes options cancelled/lapsed

j Employee wise details of options granted to :

- Senior Management Name of the employee No. of options granted

Chanakya Mishra 10000

Jaswinder Gill 10000

Paulo Tadeu Resende 27500

Penny Ward 35000

Rajeev Sibal 10000

Rick Finnegan 25000

Sanjay Gupta 20000

- any other employee who receives a grant in any one year of

option amounting to 5% or more of option granted during that

year

None

- employees who were granted option, during any one year,

equal to or exceeding 1% of the issued capital (excluding

warrants and conversions) of the Company at the time of grant

None

kDiluted earnings per share pursuant to issue of shares on exercise

of option calculated in accordance with AS 20 'Earnings per Share'

l Pro Forma Adjusted Net Income and Earning Per Share

Particulars Rs. in Lakhs

Net Income 12,846.32

As Reported

Add: Intrinsic Value Compensation Cost Nil

Less: Fair Value Compensation Cost 24.58

Adjusted Pro Forma Net Income 12,821.74

Earning Per Share: Basic

As Reported 4.93

Adjusted Pro Forma 4.92

Earning Per Share: Diluted

As Reported 4.92

Adjusted Pro Forma 4.91

ANNEXURE-B

Disclosure in the Directors’ Report as per SEBI Guidelines:


m Weighted average exercise price of Options granted during the

year whose

(a) Exercise price equals market price 228.63

(b) Exercise price is greater than market price N.A.

(c) Exercise price is less than market price N.A.

Weighted average fair value of options granted during the year

whose

(a) Exercise price equals market price 141.95

(b) Exercise price is greater than market price N.A.

(c) Exercise price is less than market price N.A.

n Description of method and signifi cant assumptions used to

estimate the fair value of options

The fair value of the options granted has been estimated using

the Black-Scholes option pricing model. Each tranche of vesting

have been considered as a separate grant for the purpose of

valuation. The assumptions used in the estimation of the same

has been detailed below:

Weighted average values for options granted during the year

Variables

Stock Price 230.16

Volatility 57.43%

Risk-free Rate 7.75%

Exercise Price 228.63

Time to Maturity 6.00

Dividend yield 22.00%

141.95

Stock Price : Closing price on NSE as on the date of grant has been considered for valuing the grants.

Volatility : We have considered the historical volatility of the stock till the date of grant to calculate the fair value.

Risk-free rate of return : The risk-free interest rate being considered for the calculation is the interest rate applicable for a maturity equal to

the expected life of the options based on the zero-coupon yield curve for Government Securities.

Exercise Price : The Exercise Price is the latest available closing market price of the equity shares of the Company, prior to the date of grant,

for the respective grants.

Time to Maturity : Time to Maturity / Expected Life of options is the period for which the Company expects the options to be live. The

minimum life of a stock option is the minimum period before which the options cannot be exercised and the maximum life is the maximum

period after which the options cannot be exercised.

Expected divided yield : Expected dividend yield has been calculated as an average of dividend yields for the four fi nancial years preceding

the date of the grant.


Report on Corporate Governance

Pursuant to Clause 49 of the Listing Agreement, a Report on Corporate Governance is given below.

1. The Company’s philosophy on Code of Governance:

The Company’s philosophy on Code of Governance is aimed at assisting the top management of the Company in the effi cient

conduct of its business and in meeting its obligations to shareholders. The Company has adopted a codifi ed Corporate Governance

Charter, inter-alia, to fulfi ll its corporate responsibilities and achieve its fi nancial objectives.

The Company believes in and has consistently practiced good corporate governance. The Company creates an environment for the

effi cient conduct of the business and to enable management to meet its obligations to all its stakeholders, including amongst others,

shareholders, customers, employees and the community in which the Company operates.

2. Board of Directors:

A. Composition:

The Board comprises of 10 Directors, of whom, three are executive, and seven are non-executive Directors. The Chairman of the

Board is a Non-Executive Director.

The Non-Executive Directors are professionals with experience in management, pharmaceutical industry, legal, fi nance,

marketing and general administration who bring in a wide range of skills and experience to the Board.

a) Details of the Board of Directors:

Name of the Director Status Relationship with other

Directors

No. of Board

Meetings

attended

No. of other

Directorships

held #

Committee

Membership(s) ##

Chairman Member

Gracias Saldanha -

Chairman

Non-Executive

– Promoter

Group

Father of Mr. Glenn Saldanha and

Ms. Cheryl Pinto and Husband of

Mrs. B. E. Saldanha

6 1 – –

B. E. Saldanha (Ms.) * Non-Executive

– Promoter

Group

Mother of Mr. Glenn Saldanha and

Ms. Cheryl Pinto and wife of Mr.

Gracias Saldanha

3 1 – –

Glenn Saldanha

Managing Director

and CEO

Executive

– Promoter

Group

Son of Mr. Gracias Saldanha and

Mrs. B. E. Saldanha and brother of

Ms. Cheryl Pinto

5 3 – 2

Cheryl Pinto (Ms.) Executive

– Promoter

Group

Daughter of Mr. Gracias Saldanha

and Mrs. B. E. Saldanha and Sister

of Mr. Glenn Saldanha

5 – – 1

J. F. Ribeiro Non-Executive

– Independent

None 5 3 5 --

A. S. Mohanty Executive None 6 – – –

N. B. Desai Non-Executive

– Independent

None 2 1 – 3

Sridhar Gorthi Non-Executive

– Independent

None 5 2 – 3

D. R. Mehta* Non-Executive

– Independent

None 3 6 – –

Hocine Sidi-Said** Non-Executive

– Independent

None 1 – – –

M. Gopal Krishnan*** Non-Executive

– Independent

None 1 – – –

# Includes Directorship(s) in Indian Companies. The Directorships held by Directors as mentioned above, do not include

Alternate Directorships and Directorships of Foreign Companies, Section 25 Companies and Private Limited Companies.

## In accordance with Clause 49 of the Listing Agreement, Membership/Chairmanship of only the Audit Committee and

Shareholders/Investors Grievance Committee of all Public Limited Companies have been considered.

* Appointed as Director w.e.f. 14th August, 2009

** Appointed as Director w.e.f. 29th October, 2009

*** Ceased to be a Director w.e.f. 29th January, 2010

b) During the Financial Year ended 31st March, 2010, Six board meetings were held on the following dates:

17th April 2009, 26th June 2009, 27th July 2009, 14th August 2009, 29th October 2009 and 29th January 2010

B. None of the Non-Executive Directors of the Company, have any pecuniary relationship or transactions with the Company other

than sitting fees paid for attending board meeting/ committee meetings and those already disclosed in the note 7 of schedule

21 to the Financial Statement in the Annual Report.

C. Mr. Gracias Saldanha, Mr. Glenn Saldanha, Mrs. Cheryl Pinto and Mr. J. F. Ribeiro attended the last Annual General Meeting of

the Company held on 25th September, 2009.


3. Audit Committee:

i) Your Company has a qualifi ed and independent Audit Committee. During the Financial Year ended 31st March, 2010, the

committee met fi ve times on 30th May, 2009, 26th June, 2009, 27th July, 2009, 28th October, 2009 and 29th January, 2010. The

attendance of the Committee members at the meetings was as follows:

ii)

Name No. of meetings attended Remarks

1. J. F. Ribeiro 4 Chairman

2. Sridhar Gorthi 3 Member

3. N. B. Desai 2 Member

4. M. Gopal Krishnan 1 (Ceased to be a member w.e.f.

29th January, 2010)

Mr. Glenn Saldanha, Managing Director & CEO, Mr. R. V. Desai, CFO and Mr. Prakash Sevekari, Cost Auditor are invitees to the

Meeting of the Audit Committee. The Company Secretary acts as a Secretary to the Committee. The terms of reference of this

committee are wide enough covering matters specifi ed in the Companies Act, 1956 read together with Clause 49 of the Listing

Agreement of the Stock Exchange. The current Charter of the Audit Committee is in line with international best practices and the

regulatory changes formulated by SEBI and the listing agreements with the stock exchanges on which your company is listed.

iii) Terms of Reference:

a) Approving and implementing the audit procedures and techniques.

b) Reviewing audit reports of both statutory and internal auditors with auditors and management.

c) Reviewing fi nancial reporting systems, internal control systems and control procedures.

d) Ensuring compliance with regulatory guidelines.

e) Reviewing the quarterly, half-yearly and annual fi nancial results of the Company before submission to the Board.

4. Remuneration of Directors:

A. The remuneration of the executive and non-executive Directors of your Company is decided by the Board of Directors on the

terms and conditions as per the recommendation by the Compensation Committee.

B. Given below are the details of remuneration/fees/commission paid to Directors during the fi nancial year ended 31st March , 2010:

Name of Director Salaries

Amount (Rs.)

Retirement

benefi ts/other

reimbursements

Amount (Rs.)

Commission

Amount (Rs.)

Sitting Fees

Amount (Rs.)

Total

Amount (Rs.)

1. Gracias Saldanha – – – 120,000 120,000

2. B. E. Saldanha – – – 60,000 60,000

3. Glenn Saldanha 9,720,000 8,562,309 – – 18,282,309

4. Cheryl Pinto 7,900,512 1,508,443 – – 9,408,955

5. J. F. Ribeiro – – – 1,80,000 1,80,000

6. N. B. Desai – – – 80,000 80,000

7. M. Gopal Krishnan* – – – 40,000 40,000

8. Sridhar Gorthi – – – 1,60,000 160,000

9. A. S. Mohanty 6,200,508 1,044,163 957,000 – 82,01,671

10. D. R. Mehta – – – 60,000 60,000

11. Hocine Sidi Said – – – 20,000 20,000

23,821,020 11,114,915 957,000 720,000 36,612,935

Notes:

1. The Executive Directors have been reappointed on 16th May, 2007 for the term of fi ve years. The service contract can be

terminated with a notice of six months.

2. Sitting fees of Rs. 1,60,000 of Mr. Sridhar Gorthi was paid to Trilegal on his behalf.

* Ceased to be director w.e.f. 29th January, 2010

Shares held by non-executive/Independent directors as on 31st March, 2010

Name of Director Equity Shares (Nos.)

Gracias Saldanha 654744

B. E. Saldanha 537598

J. F. Ribeiro 45800

N. B. Desai 30000

Sridhar Gorthi 559

D. R. Mehta NIL

Hocine Sidi Said NIL


5. Shareholders’/Investors’ Grievance Committee:

The following Committee reviews shareholders’ complaints and resolution thereof.

Name of committee Members No. of meetings held Attendance at the meeting

Shareholders’ and Investors’ Grievance

Committee.

1) J. F. Ribeiro – Chairman 7 7

2) Glenn Saldanha – Member 7 6

3) N. B. Desai – Member 7 3

4) Cheryl Pinto – Member 7 5

Compliance Offi cer: Mr. Sanjay Chowdhary – Jt. Company Secretary acts as the Compliance offi cer of the Company.

� Details of investor’s complaints received during the year ended 31st March, 2010:

No. of complaints 2009-2010 2008-2009

Received 20 50

Disposed 20 50

Pending NIL Nil

� The Company’s Registrars, Karvy Computershare Private Ltd., had received letters/complaints during the fi nancial year, all of

which were replied/resolved to the satisfaction of the shareholders.

6. Compensation Committee:

i) Broad terms of reference of the Compensation Committee:

� To recommend and review remuneration package of Executive/Non-Executive Directors.

� To approve issue of stock options to the employees.

ii) The Compensation Committee comprises of following members of the Board:

1. J. F. Ribeiro - Chairman

2. Glenn Saldanha - Member

3. N. B. Desai - Member

4. S. Gorthi - Member

iii) During the year ended 31st March, 2010, four meetings were held: 17th April 2009, 14th July 2009, 29th January 2010 and 25th

February 2010.

iv) Compensation Policy:

The Company follows a market linked remuneration policy, which is aimed at enabling the Company to attract and retain the

best talent. Compensation is also linked to individual and team performance as they support the achievement of Corporate

Goals. The Company has formulated an Employee Stock Option Scheme for rewarding & retaining performers.

7. Disclosures by Management:

a) No material, fi nancial and commercial transactions were reported by the management to the Board, in which the management

had personal interest having a potential confl ict with the interest of the company at large.

b) There are no transactions with the Director or Management, their associates or their relatives etc. that may have potential

confl ict with the interest of the Company at large.

c) There was no non-compliance during the last three years by the Company on any matter related to capital market.

Consequently, there were neither penalties imposed nor strictures passed on the Company by Stock Exchanges, SEBI or any

statutory authority.

d) Though there is no formal Whistle Blower Policy, the Company takes cognizance of the complaints made and suggestions

given by the employees and others. Even anonymous complaints are looked into and whenever necessary, suitable corrective

steps are taken. No employee of the Company has been denied access to the Audit Committee of the Board of Directors of the

Company.

e) The company has fulfi lled a non-mandatory requirement as prescribed in Annexure I D to Clause 49 of the Listing Agreement

with the Stock Exchanges, related to Remuneration Committee (Compensation Committee). Please see the Para on

Compensation Committee.

8. Shareholders information:

a) The relevant information relating to the Directors to be re-appointed at the ensuing Annual General Meeting to be held on

27th September, 2010 are given below:

i) Mr. Glenn Saldanha – 40, is a B. Pharm from Bombay University and was awarded the Watumall Foundation Award for

overall excellence. His other educational qualifi cations include an MBA from New York University’s Leonard N. Stern

School of Business (US). He has worked for Eli Lilly in the US and was a Management Consultant with Price Waterhouse

Coopers. His Services have been used by Smithkline Beecham, Rhorer, Astra, Merck and Johnson and Johnson, among

others. He has been the Managing Director of the Company since May’2002. He is also a Director of following Companies/

Body Corporates:


Names of the companies/fi rms Position

Glenmark Exports Ltd. Director

Glenmark Generics Inc., USA. Director

Glenmark Dominicana, S.R. L. Director

Glenmark Pharmaceuticals S.A. Director

Glenmark Holding S.A. Director

Glenmark Generics Ltd. Chairman

Glenmark Generics Holding S.A. Director

Glenmark Generics Finance S.A. Director

Glenmark Therapeutics Inc. USA Director

Talwalkar Better Value Fitness Ltd. Director

ii) Mr. J. F. Ribeiro – 81, is a retired Government offi cial and has served the country under various assignments. Amongst

the major positions held, he has been the Ex-Commissioner of Police, Mumbai, Former Special Secretary to Government

of India, Ministry of Home Aff airs, former Director General of Police, Punjab, Ex-Adviser to the Governor of Punjab,

Ex-Ambassador of India to Romania. He is also a Director of following Companies/Body Corporates:


Glenmark Generics Ltd. Non-Executive Director

VVF Ltd. Non-Executive Director

Fullerton India Credit Company Ltd. Non-Executive Director

iii) Mr. Sridhar Gorthi – 38, is a B.A., LLB (Hons.) from the National Law School of India University. He is presently a partner in

Trilegal and has worked with Arthur Anderson and Lex Inde, Mumbai. He is involved in legal advisory services to various

multinational and domestic corporations on restructuring, debt fi nance, joint ventures, acquisition/mergers etc. He is

also a Director of following Companies/Body Corporates:


Trilegal Partner

Triconsult India Pvt. Ltd. Director

Glenmark Generics Ltd. Director

Hathway Cable & Datacom Limited Director

Pay Pal Payment Pvt. Ltd. Director

Aurous Communications & Events (I) Pvt. Ltd. Director

Insite India adviser Limited Director

Scottish & Newcastle India Pvt. Ltd Director

RPS Research India Pvt. Ltd. Director

Petro Tiger Services India Private Limited Director

iv) Mr. Hocine Sidi Said – 45, is the Founder & Director of Bio-nAbler, an investment company that partners with Sovereign

Wealth Funds and Private Equity Firms across Asia and the MENA region to identify and execute product and company

acquisitions. He has over 20 years of experience in the pharmaceuticals industry and has worked with companies

like Pfi zer and UCB. During his stint at UCB, he was incharge of the entire Emerging Markets Region and designated

as Senior Vice President. Prior to joining UCB, he spent close to 17 years with Pfi zer in various senior management

and developmental roles in the Middle East, Central and Eastern Europe and Asia. He is also a Director of following

Companies/Body Corporates:-


Moksha 8 Inc. Member

Fuelogical Pte Ltd. Director

Bio-nAbler LLC Director

b) Share Transfer Process: The shares are sent/received for physical transfer at R & T’s offi ce and all valid transfer requests are

processed and returned within a period of 30 days from the date of receipt. The Share transfers are approved on weekly basis

by the Share Transfer Committee.

c) Dematerialisation of shares: As of 31st March, 2010, 99.05% of shares have been dematerialised and held in electronic form

through NSDL and CDSL. The shares of your company are permitted to be traded only in dematerialised form.

d) Share Holding Pattern as at 31st March, 2010:

Description No. of Shareholders Shares held % to Equity

Com pany Promoters 16 130507963 48.37

Foreign Institutional Investors 182 72432081 26.84

Residential Individuals 63881 29896297 11.08

Bodies Corporate 1363 11521963 4.27

Indian Financial Institutions 9 7905087 1.45

Mutual Funds 43 12063032 4.47

Non Resident Indians 1779 1804779 0.67

Foreign Nationals 7 112108 0.04


Description No. of Shareholders Shares held % to Equity

Banks 12 1286450 0.48

H.U.F. 1399 867228 0.32

Employees 63 512497 0.19

Clearing Members 290 779960 0.29

Directors 6 123824 0.05

Trusts 12 24284 0.01

TOTAL 69062 269837553 100.00

e) General Body Meetings:

i) The last three Annual General Meetings of the Company were held at the venue and time as under:

AGM No. Date Time Venue

29 20th September, 2007 11.00 a.m. Sunville Banquet & Conference Hall

3rd fl oor, Dr. Annie Besant Road,

Worli, Mumbai - 400 018.







All resolutions moved at the last Annual General Meeting were passed by a show of hands by requisite majority of

members who attended the meeting.

ii) Whether any special resolution passed in the previous three AGMs?

Yes.

iii) Whether any special resolution passed last year through postal ballot?

Yes

iv) Who conducted the postal ballot?

Mr. S. S. Rauthan, Practising Company Secretary.

v) Whether any special resolution is proposed to be conducted through postal ballot?

No.

vi) Procedure for postal ballot.

One resolution was passed by Postal ballot on 2nd September, 2009. Mr. S. S. Rauthan, Practising Company Secretary was

appointed as the scrutinizer for conducting the Postal Ballot and the Scrutinizer submitted his report to the Chairman of

the Board of Directors of the Company and the results were announced at the deemed Extra-Ordinary General Meeting

held on 2nd September, 2009 at the corporate offi ce of the Company at Glenmark House, HDO Corporate Building,

Wing-A, B. D. Sawant Marg, Andheri (E), Mumbai - 400 099.

The following is the result of the Postal Ballot as per the Scrutinizer’s Report.

Item No. 1 of Notice: Approval of the shareholders under Section 81(1A) and other applicable provisions, if any, of the

Companies Act, 1956 for issue of shares or Convertible instruments by the company.

Particulars No. of Postal

Ballot Forms

No. of Shares % of the total paid

up equity shares

Total Postal Ballot forms received (A) 1332 145984726 58.27

Less: Invalid Postal Ballot forms (B) 36 114998 0.05

Net valid Postal Ballot forms (as per register) (A-B) 1296 145869728 58.22

Postal Ballot forms with assent for the resolution 1239 135004939 53.89

Postal Ballot forms with dissent for the resolution 57 10864789 4.33

f) Date, Time and Venue of the Ensuing Annual General Meeting : Annual General Meeting shall be held on Monday,

27th September, 2010 at 11 a.m. at Sunville Banquet & Conference Hall, 3rd Floor, Dr. Annie Besant Road, Worli,

Mumbai - 400 018.

Record Date/Book Closure:

� Book Closure: Monday, 20th September, 2010 to Monday, 27th September, 2010 (both days inclusive)

g) Date of declaration of dividend:

A dividend of Re. 0.40 per share has been recommended by the Board of Directors on 28th May, 2010 subject to the approval

of the shareholders at the ensuing Annual General Meeting.


h) Financial Calendar (Tentative and Subject to change)

Financial reporting for the fi rst quarter ending June 30, 2010. July 2010

Financial reporting for the second quarter ending September 30, 2010. October 2010

Financial reporting for the third quarter ending December 31, 2010. January 2011

Financial results for the year ending March 31, 2011. May 2011

i) Members can avail of nomination facility by fi ling Form 2B with the Company. Blank forms can be downloaded from the

website of the Company.

j) Members may kindly note that consequent to split in the face value of equity shares of the company from Rs. 10/- to Rs. 2/- and

subsequently from Rs. 2/- to Re. 1/-, the share certifi cates in the face value of Rs. 10/-or Rs. 2/- have ceased to be valid for any

purpose whatsoever. Members who are holding share certifi cates of the face value of Rs. 10/- or Rs. 2/- each are requested to

kindly send their respective share certifi cates to the R & T Agents for receiving ten or two equity shares of face value of Re. 1/-

each in exchange of one equity share of face value of Rs. 10/- each or Rs. 2/-.

k) Pursuant to the provisions of Section 205A (5) of the Companies Act,1956, dividend for the fi nancial year ended March 31,

2001 and thereafter, which remain unclaimed for a period of seven years will be transferred by the Company to the Investor

Education and Protection Fund (IEPF) established by the Central Government pursuant to Section 205C of the Companies Act,

1956.

Information in respect of such unclaimed dividend when due for transfer to the said Fund is given below :

Financial Year

Ended

Date of declaration

of Dividend

Date of transfer to unpaid/

unclaimed dividend account

Last date for claiming

unpaid Dividend

Due date for transfer

to IEP Fund

31.03.2003 15.05.2003 15.06.2003 14.06.2010 14.07.2010

31.03.2004 29.03.2004 29.04.2004 28.04.2011 28.05.2011

31.03.2005 26.04.2005 26.05.2005 25.05.2012 24.06.2012

31.03.2006 31.01.2006 02.03.2006 01.03.2013 31.03.2013

31.03.2007 26.12.2006 25.01.2007 24.01.2014 23.02.2014

31.03.2008 31.10.2007 30.11.2007 29.11.2014 29.12.2014

31.03.2009 25.09.2009 25.10.2009 24.10.2016 23.11.2016

Shareholders who have not so far encashed their dividend warrant(s) are requested to seek issue of duplicate warrant (s)

by writing to the Company’s Registrar and Transfer Agents, M/s. Karvy Computershare Pvt. Ltd. immediately. Shareholders

are requested to note that no claims shall lie against the Company or the said Fund in respect of any amounts which were

unclaimed and unpaid for a period of seven years from the dates that they fi rst became due for payment and no payment shall

be made in respect of any such claims.

l) Means of Communication:

a) Quarterly/Half Yearly and Annual Financial Results of the Company are published in the Financial Express and Punyanagri

newspapers.

b) Your Company’s results & offi cial news releases are displayed on the company’s website.

c) All items required to be covered in the Management Discussion & Analysis are included in the Directors’ Report to

Members.

d) Company has its own web site and all the vital information relating to the company and its products is displayed on its

web site: www.glenmarkpharma.com.

e) Whether presentation made to institutional investors or to the analysts – Yes.

Your Company also regularly provides information to the stock exchanges as per the requirements of the Listing

Agreements. The Company’s website is updated periodically to include information on new developments and business

opportunities of your Company.

The Management Discussion & Analysis forms a part of the Annual Report.

9. Company’s Scrip Information:

� Listing on stock exchanges: The shares of the Company are listed on Bombay Stock Exchange Limited & the National Stock

Exchange of India Ltd.

� Listing fees for the year 2010-11 have been paid to the Stock Exchanges.

� Stock Code: 532296 on the BSE

� Electronic Form No. INE935A01035

� Scrip Name

� GLENMARK PHA- BSE

� GLENMARK - NSE


Market Price Data: High, low during each month in last fi nancial year. Performance in comparison to broad based indices namely BSE

Sensex.

(All fi gures in Indian Rupees)

Months High Low Closing BSE Sensex

Apr-09 217.50 147.50 179.80 11,403.25

May-09 268.00 161.90 227.10 14,625.25

Jun-09 266.80 199.05 217.60 14,493.84

Jul-09 274.45 203.35 249.80 15,670.31

Aug-09 280.35 202.00 217.15 15,666.64

Sep-09 239.90 213.05 237.50 17,126.84

Oct-09 252.90 215.45 224.15 15,896.28

Nov-09 258.65 210.00 231.35 16,926.22

Dec-09 287.05 234.00 275.00 17,464.81

Jan-10 290.00 235.30 242.15 16,357.96

Feb-10 268.00 240.25 251.60 16,429.55

Mar-10 273.00 230.00 266.25 17,527.77

10. Plant Locations:

The Company’s plants are located at:

i) E-37, MIDC Industrial Area, D Road, Satpur, Nasik - 422 007, Maharashtra.

ii) Village: Kishanpura, Baddi Nalagarh Road, Tehsil: Nalagarh, Dist.: Solan - 174 101, Himachal Pradesh.

iii) Business Unit II, Village Bhattanwala, PO Rajpura, Nalagarh Dist.: Solan, Himachal Pradesh.

iv) D-42, Plot No. 50, Kundaim Industrial Estate, Kundaim - 403 115, Goa.

11. Outstanding GDR’s/ADR’s/Warrants or any Convertible instruments exercised, date and likely impact on equity:

A) The Company had issued 2,36,500 new options under Employees Stock Option Scheme viz. ESOS’ 2003. During the Financial

Year 2009-2010, 6,01,100 options were cancelled and 6,04,860 options were exercised. As of 31st March, 2010, 26,33,500

options were outstanding and are due for exercise on the following dates:

ESOS’ 2003

Date Number of Options

April 27, 2010 95,200

May 22, 2010 14,500

May 29, 2010 62,300

July 4, 2010 6,000

July 9, 2010 9,000

August 14, 2010 64,800

August 22, 2010 46,800

September 16, 2010 49,800

October 9, 2010 13,600

October 12, 2010 3,600

November 8, 2010 92,000

December 9, 2010 1,11,150

January 9, 2011 68,100

January 24, 2011 75,800

February 5, 2011 2,34,850

February 16, 2011 40,000

March 21, 2011 1,15,800

April 27, 2011 88,800

May 22, 2011 10,000

July 9, 2011 18,000

July 14, 2011 13,950

August 14, 2011 54,000

ESOS’ 2003

Date Number of Options

August 22, 2011 46,800

October 9, 2011 27,200

October 12, 2011 2,400

December 9, 2011 1,11,150

January 9, 2012 68,100

February 5, 2012 2,91,850

February 25, 2012 9,500

March 21, 2012 77,200

July 9, 2012 27,000

July 14, 2012 27,900

August 22, 2012 62,400

October 9, 2012 40,800

December 9, 2012 1,48,200

January 9, 2013 90,800

February 5, 2013 17,400

February 25, 2013 19,000

July 9, 2013 36,000

July 14, 2013 41,850

October 9, 2013 54,400

February 5, 2014 23,200

February 25, 2014 28,500

July 14, 2014 55,800

February 25, 2015 38,000

Glenmark Vs. BSE SENSEX

50.00

100.00

150.00

200.00

250.00

300.00

Months

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nm

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2000

4000

6000

8000

10000

12000

14000

16000

18000

20000

BS

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Glenmark BSE

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9

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9

Jun

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Jul-

09

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On exercising the convertible options so granted under the ESOS of the Company, the paid-up equity share capital of the company will increase by a like number of shares.


B) The company had issued 20,000 Zero Coupon Foreign Currency Convertible Bonds of USD 1000 each.

i. Convertible at the option of the bondholder at any time on or after 28th March, 2005 but prior to the close of business

on 2nd January, 2010 at a fi xed exchange rate of Rs. 43.66 per 1 USD and price of Rs. 215.5985(post adjustment for bonus

and split) per share of Re. 1 each.

ii. Redeemable in whole but not in part at the option of the company on or after 15th February, 2008 if closing price of the


given was at least 130% of the applicable Early Redemption Amount divided by the conversion ratio.

iii. Redeemable on maturity date on 16th February, 2010 at 133.74% of its principal amount if not redeemed or converted

earlier. The redemption premium of 33.74% payable on maturity of the bond if there is no conversion of the bond to be

debited to Securities Premium account evenly over the period of 5 years from the date of issue of bonds.

During the year, 1000 FCC bonds of USD 1000 each aggregating to USD 1 Million were redeemed on 16th February, 2010

on maturity. As of 31st March, 2010, NIL FCC Bonds (2009-1000) of USD 1000 each are outstanding.

C) The company had issued 50,000 Zero Coupon Foreign Currency Convertible Bonds of USD 1000 each.

i. Convertible at the option of the bondholder at any time on or after 15th November, 2006 but prior to the close of

business on 2nd January 2010 at a fi xed exchange rate of Rs. 43.66 per 1 USD and the price of Rs. 253.11(post adjustment

for split) per share of Re. 1/- each.

ii. Redeemable in whole but not in part at the option of the company on or after 15th February, 2009 if closing price of the


given was at least 130% of the applicable Early Redemption Amount divided by the conversion ratio.

iii. Redeemable on maturity date on 16th February, 2010 at 134.07% of its principal amount if not redeemed or converted

earlier. The redemption premium of 34.07% payable on maturity of the bond if there is no conversion of the bond to be

debited to Securities Premium account evenly over the period of 5 years from the date of issue of bonds.

During the year, 5000 FCC Bonds of USD 1000 each aggregating to USD 5 Million were redeemed on 16th February, 2010

on maturity. As of 31st March, 2010 NIL FCC Bonds (2009-5000) of USD 1000 each are outstanding.

D) The company had issued 30,000 Zero Coupon Foreign Currency Convertible Bonds of USD 1000 each.

i. Convertible at the option of bondholder at any time on or after 11th November, 2007 and prior to the close of business

on 29th November, 2010 at a fi xed exchange rate of Rs. 44.94 per 1 USD and the conversion price of Rs. 582.60 per share

of Re. 1/- each.

ii. Redeemable in whole but not in part at the option of the Company, at any time on or after 10th January, 2010, if the

closing price of shares (translated into US Dollars at the prevailing rate) for each of the 25 consecutive trading days

immediately prior to the date upon which notice of redemption is given was at least 130% of the applicable early

redemption amount divided by the applicable Conversion Ratio.

iii. Redeemable on 11th January, 2011 at 139.729% of its Principal amount if not redeemed or converted earlier. The

redemption premium of 39.729% payable on maturity of the bond if there is no conversion of the bond to be debited to

Securities Premium account evenly over the period of 5 years from the date of issue of bonds.

As of 31st March, 2010, 30000 FCC bonds of USD 1000 each aggregating to USD 30 Million are outstanding.

12. Electronic Clearing System (ECS):

Shareholders are advised to opt for payment of dividend through ECS. The salient benefi ts of receiving dividend payment through

ECS amongst others may be listed as below:

a) There are no clearing charges in the hands of the investor/recipient, the same are borne by the Company;

b) Risk as to fraudulent encashment of the dividend warrants, loss/interception of dividend warrants in transit, are eliminated;

c) The facility ensures instant credit of the dividend amount in the desired account which to the recipient, means eff ortless and

speedier transaction and hassles as to revalidation etc are done away with;


d) Once the payment is made through ECS/NECS company issues intimation letters to the investors as to credit/payment of

dividend, providing therein the details of the account and amount. Investors may download the ECS Mandate Form from the

company’s website and send the same duly fi lled in to registrars for updating of records.

13. Investor Helpdesk: for clarifi cations/assistance, if any, please contact:

Corporate Offi ce Registrars & Transfer Agents

Persons to contact Mr. Sanjay Chowdhary Mr. M. R. V.Subrahmanyam

Add: Glenmark Pharmaceuticals Ltd.

Glenmark House, HDO Corporate Building, Wing A, B. D.

Sawant Marg, Chakala, Off . Western Express Highway,

Andheri (E), Mumbai - 400 099.

Karvy Computershare Pvt. Ltd.

Plot No. 17 to 24, Near Image Hospital, Vittalrao

Nagar, Madhapur, Hyderabad - 500 081.

Telephone (022) 40189999 (040) 23420818-828

Fax No. (022) 40189986 (040) 23420814

E-mail [email protected] [email protected]

Website: www.glenmarkpharma.com www.karvy.com

Investor Redressal: complianceoffi [email protected] -

Declaration regarding affi rmation of Code of Conduct

In terms of the requirements of the amended Clause 49 of the Listing Agreement, this is to confi rm that all the members of the Board and

the senior management personnel have affi rmed compliance with the Code of Conduct for the year ended 31st March, 2010.

Place: Mumbai Glenn Saldanha

Date: 9th August, 2010 Managing Director & CEO


We, Glenn Saldanha, Managing Director & Chief Executive Offi cer and R. V. Desai, Chief Financial Offi cer, of Glenmark Pharmaceuticals Ltd.,

certify that:

(a) We have reviewed fi nancial statements and cash fl ow statement for the year and that to the best of our knowledge and belief:

i) these statements do not contain any materially untrue statement or omit any material fact or contain statements that might be

misleading;

ii) these statements together present a true and fair view of the company’s aff airs and are in compliance with existing accounting

standards, applicable laws and regulations.

(b) There are, to the best of our knowledge and belief, no transactions entered into by the company during the year which are fraudulent,

illegal or violative of the company’s code of conduct.

(c) We accept responsibility for establishing and maintaining the internal controls for fi nancial reporting and that we have evaluated the

eff ectiveness of internal control systems of the company pertaining to fi nancial reporting and we have disclosed to the auditors and

the Audit Committee, defi ciencies in the design or operation of such internal controls, if any, of which we are aware and the steps we

have taken or propose to take to rectify these defi ciencies.

(d) We have indicated to the auditors and the Audit Committee:

i) signifi cant changes in internal control over fi nancial reporting during the year;

ii) signifi cant changes in accounting policies during the year and that the same have been disclosed in the notes to the fi nancial

statements:

iii) during the year there were no instances of fraud which we have become aware. The management and its employees have a

signifi cant role in the Company’s internal control system.

Glenn Saldanha R. V. Desai

Managing Director & Chief Executive Offi cer Chief Financial Offi cer

Place: Mumbai


Certifi cation by the Chief Executive Offi cer (CEO) and Chief Financial Offi cer (CFO) on Financial Statements of the Company


To the Members of:

GLENMARK PHARMACEUTICALS LIMITED

We have reviewed the implementation of Corporate Governance procedures by Glenmark Pharmaceuticals Limited during the year ended

31st March, 2010, with the relevant records and documents maintained by the Company, furnished to us for our review and report on

Corporate Governance as approved by the Board of Directors.

The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to a review

of procedures and implementation thereof, adopted by the Company for ensuring the compliances of the conditions of Corporate

Governance. It is neither an audit nor an expression of opinion on the fi nancial statements of the Company.

In our opinion and to the best of our information and explanations given to us, we certify that the Company has complied with the

conditions of Corporate Governance as stipulated in the Listing Agreement.

On the basis of our review and according to the information and explanations given to us, the conditions of Corporate Governance as

stipulated in Clause 49 of the Listing Agreement(s) with the stock exchanges have been complied with in all material respect by the

Company and that no investor grievance is pending for a period exceeding one month against the Company as per the records maintained

by the Shareholders/Investors Grievance Committee.

We further state that such compliance is neither an assurance as to the future viability of the Company nor the effi ciency or eff ectiveness

with which the management has conducted the aff airs of the Company.

For and on behalf of

S. S. Rauthan & Associates

Company Secretaries

Surjan Singh Rauthan

Proprietor

Place : Mumbai M. No. - FCS-4807

Date : 9th August, 2010. COP-3233

Certifi cate on Corporate Governance


Auditors’ Report

To the Members of

Glenmark Pharmaceuticals Limited

1. We have audited the attached Balance Sheet of Glenmark Pharmaceuticals Limited (the “Company”) as at 31st March, 2010, and the

related Profi t and Loss Account and Cash Flow Statement for the year ended on that date annexed thereto, which we have signed

under reference to this report. These fi nancial statements are the responsibility of the Company’s Management. Our responsibility is

to express an opinion on these fi nancial statements based on our audit.

2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards require that we plan

and perform the audit to obtain reasonable assurance about whether the fi nancial statements are free of material misstatement. An

audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the fi nancial statements. An audit also

includes assessing the accounting principles used and signifi cant estimates made by Management, as well as evaluating the overall

fi nancial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor’s Report) Order, 2003, as amended by the Companies (Auditor’s Report) (Amendment) Order,

2004 (together the “Order”), issued by the Central Government of India in terms of sub-section (4A) of Section 227 of ‘The Companies

Act, 1956’ of India (the ‘Act’) and on the basis of such checks of the books and records of the Company as we considered appropriate

and according to the information and explanations given to us, we give in the Annexure a statement on the matters specifi ed in

paragraphs 4 and 5 of the Order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:

(a) We have obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the

purposes of our audit;

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our

examination of those books;

(c) The Balance Sheet, Profi t and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books

of account;

(d) In our opinion, the Balance Sheet, Profi t and Loss Account and Cash Flow Statement dealt with by this report comply with the

accounting standards referred to in sub-section (3C) of Section 211 of the Act;

(e) On the basis of written representations received from the directors, as on 31st March, 2010 and taken on record by the Board

of Directors, none of the directors is disqualifi ed as on 31st March, 2010 from being appointed as a director in terms of clause

(g) of sub-section (1) of Section 274 of the Act;

(f) In our opinion and to the best of our information and according to the explanations given to us, the said fi nancial statements

together with the notes thereon and attached thereto give, in the prescribed manner, the information required by the Act, and

give a true and fair view in conformity with the accounting principles generally accepted in India:

(i) in the case of the Balance Sheet, of the state of aff airs of the company as at 31st March, 2010;

(ii) in the case of the Profi t and Loss Account, of the profi t for the year ended on that date; and

(iii) in the case of the Cash Flow Statement, of the cash fl ows for the year ended on that date.




Partha Ghosh

Partner


Place: Mumbai



ANNEXURE TO AUDITORS’ REPORT

Referred to in paragraph 3 of the Auditors’ Report of even date to the members of Glenmark Pharmaceuticals Limited on the fi nancial

statements for the year ended 31st March, 2010

1. (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation, of fi xed

assets.

(b) The fi xed assets are physically verifi ed by the Management according to a phased programme designed to cover all the items

over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its

assets. Pursuant to the programme, a portion of the fi xed assets has been physically verifi ed by the Management during the

year and no material discrepancies between the book records and the physical inventory have been noticed.

(c) In our opinion and according to the information and explanations given to us, a substantial part of fi xed assets has not been

disposed off by the Company during the year.

2. (a) The inventory (excluding stocks with third parties) has been physically verifi ed by the Management during the year. In respect

of inventory lying with third parties, these have substantially been confi rmed by them. In our opinion, the frequency of

verifi cation is reasonable.

(b) In our opinion, the procedures of physical verifi cation of inventory followed by the Management are reasonable and adequate

in relation to the size of the Company and the nature of its business.

(c) On the basis of our examination of the inventory records, in our opinion, the Company is maintaining proper records of

inventory. The discrepancies noticed on physical verifi cation of inventory as compared to book records were not material.

3. (a) The Company has not granted any loans, secured or unsecured, to companies, fi rms or other parties covered in the register

maintained under Section 301 of the Act.

(b) The Company has not taken any loans, secured or unsecured, from companies, fi rms or other parties covered in the register

maintained under Section 301 of the Act.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system

commensurate with the size of the Company and the nature of its business for the purchase of inventory, fi xed assets and for the

sale of goods and services. Further, on the basis of our examination of the books and records of the Company, and according to the

information and explanations given to us, we have neither come across nor have been informed of any continuing failure to correct

major weaknesses in the aforesaid internal control system.

5. According to the information and explanations given to us, there have been no contracts or arrangements referred to in Section 301

of the Act during the year to be entered in the register required to be maintained under that Section. Accordingly, the question of

commenting on transactions made in pursuance of such contracts or arrangements does not arise.

6. The Company has not accepted any deposits from the public within the meaning of Sections 58A and 58AA of the Act and the rules

framed there under.

7. In our opinion, the Company has an internal audit system commensurate with its size and nature of its business.

8. We have broadly reviewed the books of account maintained by the Company in respect of products where, pursuant to the Rules

made by the Central Government of India, the maintenance of cost records has been prescribed under clause (d) of sub-section (1) of

Section 209 of the Act, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained.

We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.

9. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the

Company is generally regular in depositing the undisputed statutory dues including provident fund, investor education and

protection fund, employees’ state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, cess and

other material statutory dues as applicable with the appropriate authorities.

(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues

of income-tax, wealth-tax, service-tax, customs duty and cess which have not been deposited on account of any dispute.

The particulars of dues of sales-tax and excise duty as at 31st March, 2010 which have not been deposited on account of a

dispute, are as follows:

Name of the statute Nature of

dues

Amount*

(Rs. lakhs)

Period to which

the amount relates

Forum where the dispute is

pending

The Central Excise Act, 1944 Excise Duty 247.02 2002 to 2006 The Central Excise and Service Tax

Appellate Tribunal

The Gujarat Sales Tax Act, 1969/The

Central Sales Act, 1956 (Gujarat)

Sales Tax 20.64 2004 - 2005 Deputy Commissioner (CT) Appeals

* Net of amount deposited under protest


10. The Company has no accumulated losses as at 31st March, 2010 and it has not incurred any cash losses in the fi nancial year ended on

that date or in the immediately preceding fi nancial year.

11. According to the records of the Company examined by us and the information and explanation given to us, the Company has not

defaulted in repayment of dues to any fi nancial institution or bank as at the balance sheet date.

12. The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other

securities.

13. The provisions of any special statute applicable to chit fund/nidhi/mutual benefi t fund/societies are not applicable to the Company.

14. In our opinion, the Company is not a dealer or trader in shares, securities, debentures and other investments.

15. In our opinion and according to the information and explanations given to us, the terms and conditions of the guarantees given by

the Company, for loans taken by others from banks or fi nancial institutions during the year, are not prejudicial to the interest of the

Company.

16. In our opinion, and according to the information and explanations given to us, on an overall basis, the term loans have been applied

for the purposes for which they were obtained.

17. On the basis of an overall examination of the balance sheet of the Company, in our opinion and according to the information and

explanations given to us, there are no funds raised on a short-term basis which have been used for long-term investment.

18. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under

Section 301 of the Act during the year.

19. The Company has not issued any debentures.

20. The Company has not raised any money by public issues during the year.

21. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted

auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance

of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the Management.




Partha Ghosh

Partner


Place: Mumbai



Balance Sheet

Rs. in (‘000s)

Schedules

As at

31st March, 2010

As at

31st March, 2009

I. SOURCES OF FUNDS

1. SHAREHOLDERS' FUNDS

a) Capital 1 269,838 250,520

b) Reserves and Surplus 2 17,464,316 12,049,185

17,734,154 12,299,705

2. LOAN FUNDS

a) Secured Loans 3 486,403 1,122,123

b) Unsecured Loans 4 7,111,150 9,536,950

7,597,553 10,659,073

3. DEFERRED TAX LIABILITY 5 327,713 411,232

TOTAL 25,659,420 23,370,010

II. APPLICATION OF FUNDS

1. FIXED ASSETS 6

a) Gross Block 3,086,286 2,704,814

b) Less: Depreciation 1,182,210 976,745

c) Net Block 1,904,076 1,728,069

d) Capital Work-in-progress 468,830 324,493

2,372,906 2,052,562

2. INVESTMENTS 7 9,929,191 2,376,317

3. DEFERRED TAX ASSETS 8 96,727 88,060

4. CURRENT ASSETS, LOANS AND ADVANCES

a) Inventories 9 1,503,976 1,303,143

b) Sundry Debtors 10 3,300,915 4,098,190

c) Cash and Bank Balances 11 50,772 116,877

d) Loans and Advances 12 10,481,709 15,726,828

15,337,372 21,245,038

LESS: CURRENT LIABILITIES AND PROVISIONS

a) Current Liabilities 13 1,902,857 2,232,555

b) Provisions 14 173,919 159,412

2,076,776 2,391,967

NET CURRENT ASSETS 13,260,596 18,853,071

TOTAL 25,659,420 23,370,010

NOTES TO THE FINANCIAL STATEMENTS 21

Schedules referred to above and notes attached there to form an integral part of the Balance Sheet.

This is the Balance Sheet referred to in our report of even date.










Profi t and Loss Account

Rs. in (‘000s)

Schedules

Year ended

31st March, 2010

Year ended

31st March, 2009

INCOME

Sales and Operating Income 15 10,296,868 8,661,724

Other Income 16 91,897 994,923

10,388,765 9,656,647

EXPENDITURE

Cost of Sales 17 3,730,510 3,055,159

Selling and Operating Expenses 18 4,473,195 2,880,774

Depreciation 6 212,778 191,045

Interest (net) 19 301,584 551,386

Research and Development Expenses 20 460,560 514,584

9,178,627 7,192,948

Profi t before Tax and Exceptional items 1,210,138 2,463,699

Exceptional Item - 2,980

PROFIT BEFORE TAX 1,210,138 2,460,719

Provision for Taxation [Refer Note 1(xi) and 10 of Schedule 21]

- Current Year [includes wealth tax provision Rs. 200 (Prev. Year – Rs.275)] 247,487 272,275

- MAT Credit (Entitlement)/Utilisation (229,795) 557,518

- Deferred Tax (92,186) (632,382)

- Fringe Benefi t Tax - 74,748

- Prior Period Tax - 9,297

NET PROFIT AFTER TAX 1,284,632 2,179,263

Balance Profi t Brought Forward 7,480,978 5,636,879

NET PROFIT AVAILABLE FOR APPROPRIATION 8,765,610 7,816,142

Proposed Dividend on Equity Shares 107,935 100,208

Tax on Proposed Dividend on Equity Shares 17,927 17,030

Residual Dividend and Dividend Tax 163 -

Transfer to General Reserve 128,463 217,926

BALANCE CARRIED TO BALANCE SHEET 8,511,122 7,480,978

Earnings Per Share (Rs.) [Refer Note 5 of Schedule 21]

Basic 4.93 8.72

Diluted 4.92 8.54

Face Value Per Share 1.00 1.00

NOTES TO THE FINANCIAL STATEMENTS 21


Profi t and Loss Account.

This is the Profi t and Loss Account referred to in our report of even date.










Cash Flow Statement

Rs. in (‘000s)

Year ended

31st March, 2010

Year ended

31st March, 2009

A. CASH FLOW FROM OPERATING ACTIVITIES:

Net Profi t before Tax 1,210,138 2,460,719

Adjustments for:

Depreciation 212,778 191,045

Interest Expense 996,645 948,134

Interest Income (695,061) (396,748)

Income from Investment - Dividends (75) (38)

(Profi t)/Loss on Fixed Assets sold 9,112 (4,102)

Provision for Doubtful Advances written back (700) -

Provision for Bad & Doubtful Debts 17,500 30,000

Provision for Gratuity & Leave Encashment 34,629 45,822

Exceptional Item - 2,980

Unrealised Foreign Exchange (Gain)/Loss 1,192,324 (744,988)

Operating Profi t Before Working Capital Changes 2,977,290 2,532,824

Adjustments for changes in working capital:

- (Increase)/Decrease in Sundry Debtors 585,198 (1,173,745)

- (Increase)/Decrease in Other Receivables 7,225,571 (436,075)

- (Increase) in Inventories (200,833) (177,893)

- Increase/(Decrease) in Trade and Other Payables (392,699) 642,603

Cash Generated from Operations 10,194,527 1,387,714

- Taxes (Paid) (Net of Tax Deducted at Source) (362,878) (447,125)

Net Cash from Operating Activities 9,831,649 940,589

B. CASH FLOW FROM INVESTING ACTIVITIES:

Purchase of Fixed Assets (463,034) (362,003)

Capital Work-in-Progress (144,337) 71,423

Proceeds from Sale of Fixed Assets 64,562 90,187

Purchase of Investments (7,542,575) (419,613)

Loans & Advances to Subsidiary Companies (2,564,114) (5,346,365)

Interest Received 647,208 74,890

Dividend Received 75 38

Net Cash used in Investing Activities (10,002,215) (5,891,443)


Cash Flow Statement

Rs. in (‘000s)

Year ended

31st March, 2010

Year ended

31st March, 2009

C. CASH FLOW FROM FINANCING ACTIVITIES:

Proceeds from Fresh Issue of

Share Capital (including Securities Premium) 4,142,780 350,586

Proceeds/(Repayment) of Long Term Borrowings 4,365,679 (791)

Proceeds/(Repayment) of Short Term Borrowings (6,426,451) 6,176,352

Proceeds from Working Capital Facilities movement (464,470) (634,150)

Redemption of FCCB (279,960) -

FCCB Premium paid on redemption including TDS (105,288) -

Interest Paid (1,009,833) (935,747)

Dividend Paid (100,966) (72)

Dividend Tax Paid (17,030) -

Net Cash from Financing Activities 104,461 4,956,178

Net Increase/(Decrease) in Cash & Cash Equivalents (66,105) 5,324

Cash and Cash Equivalents as at 31st March, 2009 116,877 111,751

Cash balance transferred to Glenmark Generics Ltd. - (198)

Cash and Cash Equivalents as at 31st March, 2010 50,772 116,877

Cash and Cash Equivalents Comprise:

Cash 1,710 1,045

Deposits with Scheduled banks 14,725 37,382

Deposits with Non-scheduled Banks 113 126

Balance with Scheduled Banks 33,022 76,173

Balance with Non-scheduled Banks 1,202 2,151

50,772 116,877

Notes:

1. The Cash Flow Statement has been prepared under the "Indirect Method" as set out in Accounting Standard - 3 on Cash Flow

Statements issued by the Institute of Chartered Accountants of India.

2. Cash and cash equivalents includes Rs. 3,122 which are not available for use by the Company. (Refer Schedule 13 to the Financial

Statements)

3. Figures in bracket indicate Cash outgo.

This is the Cash Flow Statement referred to in our report of even date.










Schedules annexed to and forming part of the Balance Sheet

Rs. in (‘000s)

As at

31st March, 2010

As at

31st March, 2009

1. CAPITAL

Authorised


4,000,000 (2009 – 4,000,000) Cumulative Redeemable non-convertible preference shares

of Rs. 100 each

400,000 400,000

Issued, Subscribed and Paid-up


TOTAL 269,838 250,520

Notes:

1. During the year ended 31st March, 2010 the Company, pursuant to Employee Stock Option Scheme 2003, has granted 236,500

(2009 - 2,305,500) options at market price as defi ned in SEBI (ESOS) Guidelines and cancelled 601,100 (2009 - 1,697,500) options.

2. During the year 604,860 (2009 - 500,300) options were converted into Equity Shares under the Employee Stock Option Scheme,

2003. As at 31st March, 2010, 2,633,500 options were outstanding under Employee Stock Option Scheme, 2003. On exercise of the

options so granted under Employee Stock Option Scheme 2003, the paid-up Equity Share Capital of the Company will increase by a


3. During the year, Nil (2009 - 7,500) Zero Coupon Foreign Currency Convertible Bonds (FCCB) of USD 1,000 each aggregating USD Nil

(2009 - USD 7.5 million) were converted into Nil (2009 - 1,293,706) equity shares of Re. 1 each. As at 31st March, 2010, FCC Bonds

amounting to USD 30 million were outstanding.

4. On 18th September, 2009 the Company allotted 18,712,935 Equity Shares of Re. 1 each at a premium of Rs. 220/- per share to Qualifi ed

Institutional Buyers pursuant to chapter VIII of the Securities Exchange Board of India (Issue of Capital and Disclosure Requirement)

Regulation 2009.

5. Of the above 158,371,140 (2009 - 158,371,140) Equity Shares of Re. 1 each are allotted as fully paid-up Bonus Shares by Capitalisation

of Reserves.

Rs. in (‘000s)

As at

31st March, 2010

As at

31st March, 2009

2. RESERVES AND SURPLUS

Securities Premium Account


Add: Premium on Issue of Shares pursuant to Conversion of ESOP 36,659 22,636

Add: Premium on Issue of Shares to Qualifi ed Institutional Buyers 4,116,846 -

Less: Issue expenses on issue of shares to QIBs 65,829 -

Add: Premium on Issue of Shares pursuant to conversion of FCC Bonds - 326,156

Add: Writeback of redemption premium for FCC Bonds converted during the year - 66,115

Less: Redemption premium of FCC Bonds 149,623 127,296

Add: Tax impact on FCCB redemption premium 35,787 -


General Reserve


Add: Transferred from Profi t and Loss Account 128,463 217,926

Add: Transfer to Fixed assets - 3,915

Less: Transfer from Foreign Currency Monetary Item Translation Diff erence Account - 91,649


Foreign Currency Monetary Item Translation Diff erence Account

Balance at the beginning of the year (246,476) -

Add: FCC Bond and ECB loan unrealised gain/(loss) as per notifi cation issued by

Ministry of Corporate Aff airs

256,318 (391,995)

Amortisation of Foreign Currency Monetary Item Translation Diff erence 26,366 145,519

Closing Balance 36,208 (246,476)

Capital Redemption Reserve 200,000 200,000

Capital Reserve 1,000 1,000

Profi t and Loss Account Balance 8,511,122 7,480,978

TOTAL 17,464,316 12,049,185



6. FIXED ASSETS [Refer Note 1(ii), 1(iii), 1(iv), 1(v)(b), 1(x) and 1(xii) of Schedule 21]

Rs. in (‘000s)

GROSS BLOCK DEPRECIATION/AMORTISATION NET BLOCK

As at

31st March,

2009

Additions

during the

year

Deductions As at

31st March,

2010

As at

31st March,

2009

For the

year

On

Deductions

As at

31st March,

2010

As at

31st March,

2010

As at

31st March,

2009

Tangible assets

Freehold Land 36,731 11,737 - 48,468 - - - - 48,468 36,731

Leasehold Land 80,894 4,758 (54,400) 31,252 2,414 967 (1,098) 2,283 28,969 78,480

Factory Buildings 351,416 114,889 - 466,305 55,484 15,298 - 70,782 395,523 295,932

Other Buildings &

Premises 201,122 5,822 - 206,944 24,273 3,340 - 27,613 179,331 176,849

Plant and Machinery 240,266 56,861 (1,661) 295,466 48,909 12,620 (46) 61,483 233,983 191,357

Furniture and Fittings 267,171 37,712 - 304,883 132,260 29,677 - 161,937 142,946 134,911

Equipments 994,179 190,295 (2,518) 1,181,956 361,991 79,988 (1,689) 440,290 741,666 632,188

Vehicles 40,818 2,037 (6,716) 36,139 17,033 5,543 (4,329) 18,247 17,892 23,785

Intangible assets

Computer software 59,496 39,212 (16,556) 82,152 22,866 13,808 (151) 36,523 45,629 36,630

Brands 432,721 - - 432,721 311,515 51,537 - 363,052 69,669 121,206

TOTAL 2,704,814 463,323 (81,851) 3,086,286 976,745 212,778 (7,313) 1,182,210 1,904,076 1,728,069

Previous Year 4,837,377 408,920 (2,541,483) 2,704,814 1,162,046 191,045 (376,346) 976,745 - -

Capital Work-in-progress 468,830 324,493

Notes:

1. Addition to Fixed assets includes Capital expenditure of Rs. 57,978 [2009 - Rs. 104,456] incurred at approved R & D centres.

2. Addition to assets include Rs. 7,499 (2009 - Rs. 5,400) being borrowing costs.

Rs. in (‘000s)

Notes

As at

31st March, 2010

As at

31st March, 2009

3. SECURED LOANS

From Banks

Term Loan 1 338,550 509,800

Working Capital Facilities 2 147,853 612,323

TOTAL 486,403 1,122,123

Notes:

1. Term loan is secured by way of exclusive charge as the case may be, at certain locations, on Company's fi xed assets both present and

future.

2. Working Capital Facilities is secured by hypothecation of Stocks of raw materials, packing materials, fi nished goods, work in process,

receivables and equitable mortgage on fi xed assets at the manufacturing facility at Nasik and Research and Development centre at

Sinnar, Nasik.

Rs. in (‘000s)

As at

31st March, 2010

As at

31st March, 2009

4. UNSECURED LOANS

Short Term Loans from Banks 1,221,727 7,656,138

Other Loans from Banks 4,481,731 -

Foreign Currency Convertible Bonds (due within one year) [Refer Note 15 of Schedule 21] 1,354,200 1,835,280

Security Deposit 53,492 45,532

TOTAL 7,111,150 9,536,950

5. DEFERRED TAX LIABILITY [Refer Note 1(xi) of Schedule 21]

Depreciation 309,904 297,339

FCC Bond/ECB Loan revaluation 17,809 113,893

TOTAL 327,713 411,232


Rs. in (‘000s)

As at

31st March, 2010

As at

31st March, 2009

7. INVESTMENTS [Refer Note 1(vi) and 14(e) of Schedule 21]

Long Term Investments - At Cost - Fully Paid

Quoted - non-trade

Equity shares

9,000 (2009 – 9,000) Bank of India of Rs. 10 each [Market Value Rs. 3,067 (2009 – Rs. 1,979)] 405 405

1,209 (2009 – 1,209) IDBI Bank Limited of Rs. 10 each [Market Value Rs. 139 (2009 – Rs. 55)] 34 34

439 439

Investment in Government Securities

National Savings Certifi cate - Sixth Issue 22 22

Unquoted - non-trade

1 (2009 – 1) Time Share of Dalmia Resorts Limited 20 20

1 (2009 – 1) Equity Share of Esquados 340,000 of Glenmark Pharmaceutica Limitada.,

Lisbon (Portugal)

48 48

213,032 (2009 - 213,032) Equity Shares of Bharuch Eco-Aqua Infrastructure Limited of

Rs. 10 each, fully paid-up

2,130 2,130

1,350,000 (2009 - 1,350,000) 7% cumulative preference shares of Rs. 100 each fully paid-up

of Marksans Pharma Ltd.

135,000 135,000

Investment with Napo Pharmaceuticals Inc. [1,176,471 (2009 - 1,176,471) Preferred shares

of USD 0.85 each]

43,560 43,560

Investment in Joint Venture - Glenmark Pharmaceuticals (Thailand) Co. Ltd. [9,800 Ordinary

shares of THB 100 each and 16,415 Ordinary Shares of THB 100 each (Paid-up 50 THB) & 2

Preference shares of THB 100 each (2009 - 9,800 Ordinary shares & 2 Preference shares) of

THB 100 each]

2,508 1,348

Investments in Subsidiary Companies - Unquoted - non-trade

a) Glenmark Exports Limited, India 18,500 18,500

[1,850,020 (2009 - 1,850,020) Equity Shares of Rs. 10 each]

b) Glenmark Impex LLC, Russia 722,279 432,287

[Roubles 455,701,648 (2009 - 266,741,126)]

c) Glenmark Philippines Inc., Philippines 116,703 87,899

[640,490 (2009 - 497,162) shares of Pesos 200 each]

d) Glenmark Pharmaceuticals (Nigeria) Ltd., Nigeria 86,609 51,335

[267,533,341 (2009 - 157,115,916) shares of Naira 1 each]

e) Glenmark Pharmaceuticals Malaysia Sdn. Bhd., Malaysia 15,286 13,977

[1,200,861 (2009 - 1,107,955) shares of RM 1 each]

f ) Glenmark Generics Ltd, India [Refer Note 4 of Schedule 21] 7,868,000 717,000

[143,210,000 (2009 - 71,700,000) shares of Rs. 10 each]

g) Glenmark Holding S. A., Switzerland 797,113 797,113

[22,520,000 (2009 - 22,520,000) shares of CHF 1 each]

h) Glenmark Pharmaceuticals (Australia) Pty. Ltd., Australia 65,047 60,734

[1,976,002 (2009 - 1,861,002) shares of AUD 1 each]

i) Glenmark Pharmaceuticals Egypt S.A.E., Egypt 42,940 1,980

[4,975,154 (2009 - 250,000) shares of EGP 1 each]

j) Glenmark Pharmaceuticals FZE (U.A.E.) 12,925 12,925

[1 (2009 - 1) shares of AED 1,000,000 each]

k) Glenmark Dominicana, SRL, Dominican Republic* 62 -

[100 (2009 - 50) shares of RD 1000 each]

9,928,752 2,375,878

TOTAL 9,929,191 2,376,317

Aggregate book value of Investments

- Quoted [Market value Rs. 3,206 (2009 - Rs. 2,034)] 439 439

- Unquoted 9,928,752 2,375,878

TOTAL 9,929,191 2,376,317

*denotes amount less than Rs. 1 ('000)



Rs. in (‘000s)

As at

31st March, 2010

As at

31st March, 2009

8. DEFERRED TAX ASSET [Refer Note 1(xi) of Schedule 21]

Provision for Bad Debts and Doubtful Advances 68,017 62,306

Others 28,710 25,754

TOTAL 96,727 88,060

9. INVENTORIES [Refer Note 1(vii) and 13(f) of Schedule 21]

(As certifi ed by the management)

Raw Materials 523,450 370,141

Packing Material 154,959 131,119

Work-in-Process 182,197 72,468

Stores and Spares 16,453 13,647

Finished Goods 626,917 715,768

TOTAL 1,503,976 1,303,143

10. SUNDRY DEBTORS [Refer Note 14(c) of Schedule 21]

Outstanding for more than six months

Secured, considered good - -


Unsecured, considered doubtful 176,098 158,598

2,686,127 1,815,324

Less: Provision for doubtful debts 176,098 158,598

2,510,029 1,656,726

Other debts -

Secured, considered good - -

Unsecured, considered good 790,886 2,441,464

790,886 2,441,464

TOTAL 3,300,915 4,098,190

11. CASH AND BANK BALANCES

Cash in hand 1,710 1,045

Balances with Scheduled banks


- Margin Money Account 14,725 37,382

- EEFC Account 31 76

Balances with Non-Scheduled Banks


- Deposit Accounts 113 126

TOTAL 50,772 116,877

The balances in the margin money accounts are given as security against guarantees issued by banks on behalf of the Company.

Bank balances with Non-Scheduled banks in current account includes: Rs. in (‘000s)

As at 31st

March, 2010

Maximum amount outstanding

during the year 2009-2010

As at 31st

March, 2009


during the year 2008-2009

Bank for Foreign Trade of Vietnam 58 404 92 1,502

Imperial Bank 66 225 116 170

Foreign Trade Bank of Cambodia 335 484 163 383

State Export-Import Bank of Ukraine 32 1,826 183 2,395

Taib Kazak Bank 461 948 64 838

Alp Jamol Bank USD A/c 224 723 499 1,240

Alp Jamol Bank Local Currency A/c 7 522 40 585

HSBC Singapore USD 19 30 30 143

Barclays Bank,New Maadi Branch - 345 346 800

Bank of Kazakhstan – USD A/c - 1,222 618 775

1,202 2,151

Bank balances with Non-Schedule Banks in Deposit account includes:

HSBC Call Deposit USD 113 126 126 126



Rs. in (‘000s)

As at

31st March, 2010

As at

31st March, 2009

12. LOANS AND ADVANCES (unsecured, considered good unless otherwise stated)

Advances recoverable in cash or kind or for value to be received

Considered good 375,370 576,056

Considered doubtful 29,100 29,800

404,470 605,856

Less: Provision for Doubtful advances (29,100) (29,800)

375,370 576,056

Receivable from Glenmark Generics Ltd. 770,500 7,598,996

Advances to subsidiaries [Refer Note 14(a) and (b) of Schedule 21] 8,508,090 6,649,554

Share Application Money - pending allotment

- [Egyptian Pound Nil (2009 - 1,158,308)] Glenmark Pharmaceuticals Egypt (S.A.E.) - 10,299

Advance to Vendors 104,275 432,999

Advance tax [net of provision of Rs. 1,524,636 (2009 - Rs. 1,313,135)] 204,699 91,382

MAT Credit Entitlement [Refer Note 10 of Schedule 21] 232,304 2,509

Balance with Excise Authorities 163,809 238,609

Deposits 122,662 126,424

TOTAL 10,481,709 15,726,828

13. CURRENT LIABILITIES

Acceptances 494,716 -

Sundry creditors [Refer Note 8 of Schedule 21]

- Total outstanding dues to Micro enterprises and small enterprises - 26,524

- Total outstanding dues to creditors other than Micro enterprises and small enterprises 791,803 1,463,950

Investor Education and Protection Fund shall be credited by

- Unclaimed Dividend 3,122 3,717

[There are no amounts due and outstanding to be credited to Investor Education

and Protection Fund]

Advances from Customer - 46,648

Payable to Subsidiaries [Refer Note 14(d) of Schedule 21] 6,486 120,868

Other Liabilities 157,073 152,337

Interest accrued but not due 449,657 418,511

TOTAL 1,902,857 2,232,555

14. PROVISIONS

Proposed Dividend 107,935 100,208

Tax payable on Proposed Dividend 17,927 17,030

Provision for Wealth Tax 252 276

Provision for Fringe Benefi t Tax - 2,050

Provident Fund Scheme payable 7,543 7,288

Provision for Gratuity and leave encashment [Refer Note 11 of Schedule 21] 40,262 32,560

TOTAL 173,919 159,412



Schedules annexed to and forming part of the Profi t and Loss Account

Rs. in (‘000s)

Year ended

31st March, 2010

Year ended

31st March, 2009

15. SALES AND OPERATING INCOME [Refer Note 1(ix) and 13(b) of Schedule 21]

Sale of goods* 10,281,576 8,647,288

Income from services 15,292 14,436

TOTAL 10,296,868 8,661,724

* includes Sales Tax and Excise Duty aggregating Rs. 388,827 (2009 – Rs. 311,401)

and Rs. 77,763 (2009 – Rs. 108,810) respectively.

16. OTHER INCOME

Dividend received on non trade Investments 75 38

Exchange gain - 867,485

Export Incentive 48,574 76,200

Profi t on Sale of Fixed Assets - 4,102

Provision for Doubtful Advances Written back 700 -

Guarantee Commission 26,062 29,135

Miscellaneous income 16,486 17,963

TOTAL 91,897 994,923

17. COST OF SALES

Salary, wages, bonus and allowances 143,388 127,402


Labour charges 148,249 152,784

Consumption of raw and packing materials [Refer Note 13(d) and (e) of Schedule 21] 2,002,785 1,678,637

Purchase of Traded goods [Refer note 13(c) of Schedule 21] 841,496 687,227

Excise Duty 75,924 116,132

Sales Tax 388,827 311,401

Power, fuel and water charges 61,239 54,783

Consumption of stores and spares [Refer note 13(e) of Schedule 21] 42,272 43,013

Repairs and maintenance - Plant and Machinery 21,087 14,785

Repairs and maintenance - Building 5,056 2,809

Rent 1,650 -

Other manufacturing expenses 14,363 13,568

(Increase)/Decrease in inventory (20,878) (151,620)

TOTAL 3,730,510 3,055,159

18. SELLING AND OPERATING EXPENSES

Salary, bonus and allowances 888,179 818,658



Directors' salaries, allowances and commission [Refer Note 12 of Schedule 21] 36,613 95,709


Sales promotion expenses 919,629 556,614

Export commission 34,368 21,360

Commission on sales 44,864 29,590


Freight outward 165,391 169,819

Telephone expenses 19,247 22,005

Rates and taxes 7,520 6,721

Provision for doubtful debts 17,500 30,000



Rent 87,016 89,831


Schedules annexed to and forming part of the Profi t and Loss Account

Year ended

31st March, 2010

Year ended

31st March, 2009

18. SELLING AND OPERATING EXPENSES (Contd.)

Repairs & Maintenance - Others 59,126 63,835

Auditors' remuneration

- Audit fees 4,800 4,200

- Other matters 96 126

- Out of pocket expenses 33 124

Loss on sale of assets 9,112 -

Exchange Loss 1,143,543 -

Other operating expenses 343,169 327,003

TOTAL 4,473,195 2,880,774

19. INTEREST (Net)

On term loans from bank 345,803 150,042

On other loans from bank 650,842 798,092

996,645 948,134

Less: Interest Income

On deposits with banks [tax deducted at source Rs. 247 (2009 - Rs. 653)] 10,258 3,111

On Loans given to Subsidiaries 684,803 393,637

695,061 396,748

TOTAL 301,584 551,386

20. RESEARCH AND DEVELOPMENT EXPENSES [Refer Note 1(x) of Schedule 21]

Salary and other allowances 180,181 180,474



Incentive and commission 24 9,290

Consumable and Chemicals 140,888 166,241


Repairs and maintenance - Building 182 131

Repairs and maintenance - Others 25,060 17,925


Other expenses 84,708 110,408

TOTAL 460,560 514,584

Rs. in (‘000s)


Schedules annexed to and forming part of the Financial Statements

SCHEDULE 21 - NOTES TO THE FINANCIAL STATEMENTS

1. SIGNIFICANT ACCOUNTING POLICIES

i) Basis of Accounting

The Financial Statements are prepared to comply in all material aspects with all the applicable accounting principles in India,

the applicable Accounting Standards notifi ed u/s 211(3C) of the Companies Act,1956 and the relevant provisions of the

Companies Act,1956.

ii) Fixed Assets (including Intangibles), Depreciation and Amortisation

Fixed assets are stated at cost less accumulated depreciation and amortisation. The Company capitalises all costs relating

to the acquisition and installation of fi xed assets. Expenditure of revenue nature, incurred in setting up of new projects, is

capitalised as an indirect cost towards construction of the fi xed assets.

Depreciation is provided using the straight line method, pro-rata to the period of use of assets, based on the useful lives of fi xed

assets as estimated by management, or at the rates specifi ed in Schedule XIV of the Companies Act, 1956, whichever is higher.

Brands/IP Rights are amortised from the month of products launch/commercial production, over the estimated economic life

not exceeding 10 years.

Fixed assets having aggregate cost of Rs. 5,000 or less are depreciated fully in the year of acquisition.

The Company has estimated the useful life of its assets as follows:

Category Estimated useful life (in years)

Plant and Machinery 8 - 20

Vehicles 5 - 6

Equipments and Air conditioners 4 - 20

Furniture and Fixtures 10

Computer Software 5

Brands 5 - 10

Leasehold land and improvement is amortised over the period of lease.

iii) Borrowing Costs

Borrowing costs that are attributable to the acquisition and construction of a qualifying asset are capitalised as a part of the

cost of the asset. Other borrowing costs are recognised as an expense in the year in which they are incurred.

iv) Impairment of Assets

The Company assesses at each Balance Sheet date whether there is any indication that an asset may be impaired. If any such

indication exist, the Company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the

recoverable amount of the cash generating unit to which the asset belongs is less than its carrying amount, the carrying

amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognised in the Profi t and

Loss Account. If at the Balance Sheet date there is an indication that if a previously assessed impairment loss no longer exist,

the recoverable amount is reassessed and the asset is refl ected at the recoverable amount.

v) Foreign Currency Transactions

a) Foreign currency transactions are recorded at the exchange rates prevailing on the date of such transactions. Monetary

assets and liabilities as at the Balance Sheet date are translated at the rates of exchange prevailing at the date of the

Balance Sheet. Gain/loss arising on account of diff erences in foreign exchange rates on settlement/translation of

monetary assets and liabilities are recognised in the Profi t and Loss Account. Non-monetary foreign currency items are

carried at cost.

b) Gain/loss on account of foreign exchange fl uctuation in respect of liabilities in foreign currencies specifi c to acquisition

of fi xed assets are recognised in the Profi t and Loss Account.

vi) Investments

Long-term investments are stated at cost. Provision, where necessary, is made to recognize a decline, other than temporary, in

the value of the investments.

vii) Inventories

Inventories of fi nished goods, consumable store and spares are valued at cost or net realisable value, whichever is lower. Cost

of raw materials and packing materials is ascertained on a fi rst-in-fi rst-out basis. Cost of work-in-process and fi nished goods

include the cost of materials consumed, labour and manufacturing overheads. Excise and customs duty accrued on production

or import of goods, as applicable, is included in the valuation of inventories. Net realisable value is the estimate of the selling

price in the ordinary course of the business.

viii) Employee Benefi ts

Long-term Employee Benefi ts

In case of Defi ned Contribution plans, the Company's contributions to these plans are charged to the Profi t and Loss Account as

incurred. Liability for Defi ned Benefi t plans is provided on the basis of valuations, as at the Balance Sheet date, carried out by an

independent actuary. The actuarial valuation method used for measuring the liability is the Projected Unit Credit method. The

estimate of future salary increases considered takes into account the infl ation, seniority, promotion and other relevant factors.

The expected rate of return on plan assets is the Company's expectation of the average long-term rate of return expected

on investments of the fund during the estimated term of the obligations. Plan assets are measured at fair value as at the

Balance Sheet date.



ix) Revenue Recognition

The Company recognizes revenue on despatch of goods to customers. Revenues from services are recognized on completion

of such services. Revenue from IP asset/Marketing rights is recognized on transfer of ownership/right to use in accordance with

the terms of relevant agreements. Revenue from contract research being in the nature of product development activities is

recognized as per the terms of the agreement. Revenues are recorded at invoice value, inclusive of excise duty and sales-tax,

but net of returns and trade discounts.

x) Research and Development

Capital expenditure on Research and Development (R & D) is capitalised as fi xed assets. Development cost relating to the new

and improved product and/or process development is recognised as an intangible asset to the extent that it is expected that

such asset will generate future economic benefi ts. Other research and development costs are expensed as incurred.

xi) Taxation

Current Tax

Current tax is determined as the amount of tax payable in respect of taxable income for the year.

Deferred Tax

Deferred tax is recognised, subject to the consideration of prudence, on timing diff erences being the diff erence between

taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent

period. Deferred tax assets are not recognised on unabsorbed depreciation and carry forward of losses unless there is virtual

certainty that suffi cient future taxable income will be available against which such deferred tax assets can be realised.

Deferred tax assets/liabilities recognised as above is after excluding the amounts, which are getting reversed during the tax

holiday period.

xii) Leases

Finance Leases

Assets acquired under fi nance lease are recognised as assets with corresponding liabilities in the Balance Sheet at the inception

of the lease at amounts equal to lower of the fair value of the leased asset or at the present value of the minimum lease

payments. These leased assets are depreciated in line with the Company’s policy on depreciation of fi xed assets. The interest is

allocated to periods during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the

liability for each period.

Operating Leases

Lease rent in respect of assets taken on operating lease are charged to the Profi t and Loss Account as per the terms of lease

agreements.

xiii) Employee Stock Option Schemes (ESOS)

The Company accounts for compensation expense under the Employee Stock Option Schemes using the intrinsic value

method as permitted by the Guidance Note on "Accounting for Employee Share-based Payments" issued by the Institute of

Chartered Accountants of India. The diff erence between the market price and the exercise price as at the date of the grant is

treated as compensation expense and charged over the vesting period.

xiv) Provisions and Contingent Liabilities

The Company recognises a provision when there is a present obligation as a result of a past event that probably requires an

outfl ow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability

is made when there is a possible obligation or a present obligation that may, but probably will not, require an outfl ow of

resources. Where there is a possible obligation or a present obligation that the likelihood of outfl ow of resources is remote, no

provision or disclosure is made.

2. As per the transitional provision given in the notifi cation issued by Ministry of Corporate Aff airs dated 31st March, 2009 the Company

has opted for the option of adjusting the exchange diff erence on long-term foreign currency monetary items:

i) To the cost of the assets acquired out of this foreign currency monetary item. During the year, Company has decapitalised

exchange diff erence amounting to Rs. 105.46 lakhs on restatement of long-term loans used for acquiring the fi xed assets.

ii) To the Foreign Currency Monetary Item Translation Diff erence account. During the year, Company has transferred exchange

gain of Rs. 2,563.18 lakhs on restatement of long-term loans. Accordingly, Proportionate amount of Rs. 263.66 lakhs is amortised

and Depreciation charged of Rs. 17.04 lakhs for the year ended 31st March, 2010. Due to the above profi t for the year is lower by

Rs. 1,988.50 lakhs (net of tax).

3. CONTINGENT LIABILITIES NOT PROVIDED FOR

Rs. in (‘000s)


(a) Bank Guarantees 20,768 21,671

Disputed Income Tax/Excise Duty/Sales Tax 26,765 27,285

Claims against the Company not acknowledged as debts (Refer Note i) 386 380

Open letters of credit 5,274 -

Sundry debtors factored with recourse option (Refer Note ii) 3,500,000 2,800,000

Indemnity Bond 345,366 331,876

Call money payable to Glenmark Pharmaceuticals (Thailand) Co. Ltd.

(16,415 shares @ 50 THB per Ordinary Share) 1,149 -

Corporate Guarantee (Refer Note iii) 8,283,012 7,974,112

Corporate Guarantee (Refer Note iv) 1,218,780 1,376,460



Notes:

i) In respect of labour/industrial disputes.

ii) The amount related to Credit facilities given by bank against debtors.

iii) Corporate guarantee given on behalf of various subsidiaries :

Citibank [Given on behalf of Glenmark Holding SA, Switzerland (GHSA)] 4,514,000 5,098,000

ICICI Bank [Given on behalf of Glenmark Holding SA, Switzerland (GHSA)] 645,502 729,014

HSBC Bank (Given on behalf of Glenmark Farmaceutica Ltda, Brazil) - 101,960

Citi Bank (Given on behalf of Glenmark Pharmaceuticals S.R.L. Romania) 5,204 5,804

ALD Automotive (Given on behalf of Glenmark Impex, L.L.C. Russia) 98,026 109,334

ING Vysya Bank (Given on behalf of Glenmark Generics Ltd.) 430,000 430,000

Central Bank of India (Given on behalf of Glenmark Generics Ltd., India) 1,500,000 1,500,000

Citibank (Given on behalf of Glenmark Pharmaceutica Ltda., Brazil) 90,280 -

Yes Bank Ltd. (Given on behalf of Glenmark Generics Ltd.) 1,000,000 -

iv) The Company's subsidiary, Glenmark Generics Inc., U.S.A. (GGI) [formerly known as Glenmark Pharmaceuticals Inc., U.S.A.

(GPI)] on 2nd June, 2006 has entered into an Agreement with Paul Royalty Fund Holdings II (PRF) pursuant to which, PRF

will pay upto USD 27 million to GGI for the development and commercialization of certain products for the US market.

Further, the Company has entered into a Master Services, License, Manufacturing and Supply Agreement with GGI to

develop and manufacture the aforesaid products, and also issued a fi nancial guarantee in favour of PRF for an amount

not exceeding USD 27 million for the benefi ts under the said agreement.

b) Estimated amount of contracts remaining to be executed on capital account, net of advances, not provided for as at 31st March,

2010 aggregate Rs. 137,151 (2009 – Rs. 120,170).

4. During the year, the Company subscribed to 71,510,000 equity shares for a consideration of Rs. 7,151,000 ('000) in its subsidiary

Glenmark Generics Limited for the balance Business sale consideration.

5. EARNINGS PER SHARE

Basic earnings per share is calculated by dividing the net profi t for the year attributable to equity shareholders by the weighted

average number of equity shares outstanding during the year.

For the purpose of calculating diluted earnings per share, the weighted average number of shares outstanding are adjusted for the

eff ects of all dilutive potential equity shares from the exercise of options on unissued share capital and on conversion of FCC Bonds.

The calculations of earnings per share (basic and diluted) are based on the earnings and number of shares as computed below.

Rs. in (‘000s)

2009-2010 2008-2009

Profi t after tax for the fi nancial year (attributable to equity shareholders) 1,284,632 2,179,263

In (‘000s)

Reconciliation of number of shares No. of Shares No. of Shares

Weighted average number of shares:

For basic earnings per share 260,759 250,025

Add:

Deemed exercise of options on unissued equity share capital and conversion of FCC Bonds 565 5,237

For diluted earnings per share 261 ,324 255,262

Earnings per share (nominal value Re. 1 each) Rs. Rs.

Basic 4.93 8.72

Diluted 4.92 8.54

6. SEGMENT INFORMATION

Business segments

The Company is primarily engaged in a single segment business of formulations and is managed as one entity, for its various activities

and manufacturing and marketing of pharmaceutical is governed by a similar set of risks and returns.

Geographical segments

In the view of the management, the Indian and export markets represent geographical segments.

Sales by market – The following is the distribution of the Company's sale by geographical market:

Rs. in (‘000s)

2009-2010 2008-2009

Geographical segment

India 7,528,626 6,146,628

Other than India* 2,768,242 2,515,096

TOTAL 10,296,868 8,661,724

* includes deemed exports aggregating Rs. Nil (2009 – Rs. 354,036)


Assets and additions to fi xed assets by geographical area – The following table shows the carrying amount of segment assets and

additions to fi xed assets by geographical area in which the assets are located:

Rs. in (‘000s)

India Others* India Others*

2009-2010 2009-2010 2008-2009 2008-2009

Carrying amount of segment assets 25,558,999 2,080,470 23,303,046 2,370,871

Additions to fi xed assets 463,323 - 408,920 -

* Others represent receivables from debtors located outside India including those related to deemed exports and cash and bank

balances of branches outside India.

7. RELATED PARTY DISCLOSURES

In accordance with the requirements of Accounting Standard - 18 "Related Party Disclosures", the names of the related parties where

control exists and/or with whom transactions have taken place during the year and description of relationships, as identifi ed and

certifi ed by the management are as follows:

a) Parties where direct/indirect control exists

i) Subsidiary Companies

Glenmark Pharmaceuticals Europe Ltd., U.K.

Glenmark Generics (Europe) Ltd., U.K. [formerly known as Glenmark Pharmaceuticals (Europe) Ltd.]

Glenmark Pharmaceuticals S.R.O. (formerly known as Medicamenta A.S., Czech Republic)

Glenmark Pharmaceuticals SK, s.r.o., Slovak Republic (Formerly known as Medicamenta SK SRO)

Glenmark Pharmaceuticals S.A., Switzerland

Glenmark Holding S.A., Switzerland

Glenmark Generics Holding S.A., Switzerland

Glenmark Generics Finance S. A., Switzerland

Glenmark Pharmaceuticals S.R.L., Romania

Glenmark Pharmaceuticals Eood., Bulgaria

Glenmark Distributor SP z.o.o., Poland

Glenmark Pharmaceuticals SP. z.o.o., Poland

Glenmark Generics Inc., USA

Glenmark Therapeutics Inc., USA

Glenmark Farmaceutica Ltda., Brazil

Glenmark Generics S.A., Argentina

Glenmark Pharmaceuticals Mexico, S.A. DE C.V., Mexico

Glenmark Pharmaceuticals Peru SAC., Peru

Glenmark Pharmaceuticals Colombia Ltda., Colombia

Glenmark Uruguay S.A. (formerly known as Badatur S.A., Uruguay)

Glenmark Pharmaceuticals Venezuela., C.A., Venezuela

Glenmark Dominicana SRL, Dominican Republic (formerly known as Glenmark Dominicana S.A.)

Glenmark Pharmaceuticals Egypt S.A.E., Egypt

Glenmark Pharmaceuticals FZE., U.A.E.

Glenmark Impex L.L.C., Russia

Glenmark Philippines Inc., Philippines

Glenmark Pharmaceuticals (Nigeria) Ltd., Nigeria

Glenmark Pharmaceuticals Malaysia Sdn Bhd., Malaysia

Glenmark Pharmaceuticals (Australia) Pty Ltd., Australia

Glenmark South Africa (Pty.) Ltd., South Africa

Glenmark Pharmaceuticals South Africa (Pty.) Ltd., South Africa

Glenmark Exports Ltd., India

Glenmark Generics Ltd., India

ii) Investment in Joint Venture

Glenmark Pharmaceuticals (Thailand) Co. Ltd., Thailand

b) Related party relationships where transactions have taken place during the year

Subsidiary Companies

Glenmark Exports Ltd., India

Glenmark Farmaceutica Ltda., Brazil



Glenmark Philippines Inc., Philippines

Glenmark Pharmaceuticals (Nigeria) Ltd., Nigeria

Glenmark Pharmaceuticals S.A., Switzerland

Glenmark Pharmaceuticals Malaysia Sdn. Bhd., Malaysia

Glenmark Pharmaceuticals (Australia) Pty. Ltd., Australia

Glenmark Impex L.L.C., Russia

Glenmark Holding S.A., Switzerland

Glenmark Generics Ltd., India

Glenmark Pharmaceuticals Venezuela., C.A., Venezuela

Glenmark Pharmaceuticals South Africa (Pty.) Ltd., South Africa

Glenmark Dominicana SRL, Dominican Republic

c) Key management personnel

Mr. Gracias Saldanha

Mrs. B.E. Saldanha

Mr. Glenn Saldanha

Mrs. Cheryl Pinto

Mr. A.S. Mohanty

d) Transactions with related parties during the year

Rs. in (‘000s)

2009-2010 2008-2009

Subsidiary Company

1. Sale of Finished Products & Services 1,101,531 1,314,750

Glenmark Exports Ltd., India - 353,098

Glenmark Pharmaceuticals S.A., Switzerland 461,465 523,189

Glenmark Farmaceutica Ltda., Brazil 87,689 65,611

Glenmark Pharmaceuticals Inc., Philippines 41,687 22,737

Glenmark Impex L.L.C., Russia 481,562 304,968

Glenmark Generics Ltd., India 249 22,400

Glenmark Pharmaceuticals (Nigeria) Ltd., Nigeria 23,055 22,747

Glenmark Pharmaceuticals South Africa (Pty) Ltd., South Africa 395 -

Glenmark Pharmaceuticals Venezuela., C.A., Venezuela 5,429 -

2. Purchase of Finished Products & Services 220,925 295,511

Glenmark Generics Ltd., India 217,065 295,511

Glenmark Generics S.A., Argentina 3,860 -

3. Investment in Share Capital 7,552,874 789,315

Glenmark Philippines Inc., Philippines 28,804 36,689

Glenmark Pharmaceuticals Malaysia Sdn. Bhd., Malaysia 1,309 3,846

Glenmark Pharmaceuticals (Nigeria) Ltd., Nigeria 35,274 -


Glenmark Pharmaceuticals (Australia) Pty. Ltd., Australia 4,313 60,734

Glenmark Pharmaceuticals Egypt S.A.E., Egypt 40,960 1,980

Glenmark Pharmaceuticals (Thailand) Co. Ltd., Thailand 1,160 1,348

Glenmark Pharmaceuticals FZE., (U.A.E.) - 12,925

Glenmark Generics Ltd., India 7,151,000 380,000

Glenmark Dominicana SRL, Dominican Republic 62 -

4. Share Application Money - 10,299

Glenmark Pharmaceuticals Egypt S.A.E., Egypt - 10,299

5. Sale of Business to - 7,500,000

Glenmark Generics Ltd., India - 7,500,000

6. Sale of Fixed Assets to 19,150 94,268

Glenmark Pharmaceuticals S.A., Switzerland 755 6,349




Rs. in (‘000s)

2009-2010 2008-2009

7. Purchase of Fixed Assets 23,400 86,872


Glenmark Generics Ltd., India - 4,220

8. Advance received - 1,920

Glenmark Pharmaceuticals (Australia) Pty. Ltd., Australia - 1,920

9. Advances given 2,405 107

Glenmark Pharmaceuticals (Australia) Pty. Ltd., Australia - 107

Glenmark Pharmaceuticals (Nigeria) Ltd., Nigeria 2,405 -

10. Loan given to 3,417,084 5,719,717

Glenmark Holding S.A., Switzerland 3,410,337 4,775,744

Glenmark Pharmaceuticals (Nigeria) Ltd., Nigeria - 20,765



Glenmark Pharmaceuticals Egypt S.A.E., Egypt 6,747 -

11. Loan repaid by 1,598,644 798,190

Glenmark Holding S.A., Switzerland 997,570 -


Glenmark Philippines Inc., Philippines - 19,484


Glenmark Pharmaceuticals Egypt S.A.E., Egypt 6,747 -

12. Interest on Loan Given 684,803 393,637

Glenmark Philippines Inc., Philippines - 228


Glenmark Holding S.A., Switzerland 260,734 118,103

Glenmark Pharmaceuticals (Australia) Pty. Ltd., Australia - 965



Glenmark Pharmaceuticals Egypt S.A.E., Egypt 237 -

13. Expenses paid on behalf of Glenmark Pharmaceuticals Ltd., India 54,216 22,122

Glenmark Farmaceutica Ltda., Brazil 243 815



Glenmark Pharmaceuticals FZE., U.A.E. 26,069 -

14. Expenses paid on behalf of Glenmark Generics Ltd., India 85,219 90,019

15. Reimbursement of expenses to Glenmark Exports Ltd., India 45,780 45,661

16. Other Income from 30,352 29,135

Glenmark Generics Ltd., India 4,290 -

Glenmark Holding S.A., Switzerland 26,062 29,135

17. Labour Charges to Glenmark Generics Ltd., India 592 5,260

18. Factory rent to Glenmark Generics Ltd., India 1,650 -

Key management personnel

Remuneration 36,073 95,429

Mr. Gracias Saldanha 120 25,882

Mrs. B. E. Saldanha 60 40

Mr. Glenn Saldanha 18,282 34,093

Mrs. Cheryl Pinto 9,409 15,011

Mr. R. V. Desai (resigned from the board eff ective from

1st April, 2009)

- 9,190

Mr. A. S. Mohanty 8,202 11,213



Rs. in (‘000s)

2009-2010 2008-2009

e) Related party balances

Receivable/(Payable) from/(to) Subsidiary companies 9,888,720 15,199,299

Glenmark Exports Ltd., India 159,479 661,603




Glenmark Holding S.A., Switzerland 7,422,429 5,519,684


Glenmark Generics Ltd., India 770,500 7,858,349


Glenmark Pharmaceuticals South Africa (Pty.) Ltd., South Africa 395 -

Glenmark Pharmaceuticals FZE., U.A.E. (6,486) -

Glenmark Generics SA., Argentina 1,091 -


8. OUTSTANDING DUES TO MICRO, SMALL AND MEDIUM SCALE BUSINESS ENTITIES

The Company has not received any information from the "suppliers" regarding their status under the Micro, Small and Medium

Enterprises Development Act, 2006 & hence disclosures, if any, relating to the amounts as at year end together with interest paid/

payable as required under the said Act have not been given.

9. LEASES

The Company has taken on lease/leave and licence godowns/residential & offi ce premises at various locations in the country.

i) The Company's signifi cant leasing arrangements are in respect of the above godowns & premises (including furniture and

fi ttings therein, as applicable). The aggregate lease rentals payable are charged to Profi t and Loss Account as Rent.

ii) The Leasing arrangements which are cancellable range between 11 months and 5 years. They are usually renewable by mutual

consent on mutually agreeable terms. Under these arrangements, generally refundable interest free deposits have been given.

An amount of Rs. 83,911 ('000) [2009 - Rs. 78,559 ('000)] towards deposit and unadjusted advance rent is recoverable from the

lessor.

10. TAXATION

Provision for current taxation for the Company of Rs. 211,500 ('000) represents Minimum Alternate Tax pursuant to the provisions of

Section 115JB of the Income Tax Act, 1961 of India.

The Finance Act, 2005 inserted sub-section (1A) to Section 115JAA to grant tax credit in respect of MAT paid under Section 115JB of the

Act with eff ect from Assessment Year 2006-07 and carry forward the credit for a period of 10 years. In accordance with the Guidance

Note issued on “Accounting For Credit Available in Respect of Minimum Alternative Tax (MAT) under the Income Tax Act, 1961” by the

Institute of the Chartered Accountants of India, the Company has recognised MAT Credit which is expected to be set-off against the

tax liability, other than MAT in future years. Accordingly, an amount of Rs. 232,304 ('000) for the current year is included as MAT Credit

Entitlement in Schedule 12 - Loans and Advances.

11. EMPLOYEE BENEFITS

The disclosures as required as per the revised AS 15 are as under:

1. Brief description of the Plans

The Company has various schemes for long-term benefi ts such as Provident Fund, Superannuation, Gratuity and Leave

Encashment. In case of funded schemes, the funds are recognised by the Income tax authorities and administered through

appropriate authorities. The Company's defi ned contribution plans are Superannuation and Employees' Provident Fund and

Pension Scheme (under the provisions of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952) since the

Company has no further obligation beyond making the contributions. The Company's defi ned benefi t plans include Gratuity

and Leave Encashment.

Rs. in (‘000s)

2009-2010 2008-2009

2. Charge to the Profi t and Loss Account based on contributions:

Superannuation 2,331 2,326

Provident fund 55,092 50,642

57,423 52,968



3. Disclosures for defi ned benefi t plans based on actuarial reports as on 31st March, 2010: Rs. in ('000s)

2009-2010 2008-2009

Gratuity

(Funded

plan)

Leave

Encashment

(Funded

plan)

Gratuity

(Funded

plan)

Leave

Encashment

(Funded

plan)

(i) Change in Defi ned Benefi t Obligation

Opening defi ned benefi t obligation 109,641 55,509 103,127 48,330


Interest cost 7,919 3,719 7,711 3,169

Actuarial loss/(gain) 721 6,728 1,958 8,299

Benefi ts paid (8,117) (11,853) (18,191) (19,368)

Closing defi ned benefi t obligation 126,818 68,286 109,641 55,509

(ii) Change in Fair Value of Assets

Opening fair value of plan assets 107,981 24,609 76,559 29,790


Actuarial gain/(loss) 2,906 (198) (4,758) (386)

Contributions by employer 10,117 16,810 46,219 12,152

Benefi ts paid (8,117) (11,853) (18,191) (19,369)

Closing fair value of plan assets 122,968 31,874 107,981 24,609

(iii) Reconciliation of Present Value of Defi ned Benefi t Obligation

and the Fair Value of Assets

Present value of funded obligations as at year end 126,818 68,286 109,641 55,509


Funded Liability/(Asset) recognised in the Balance Sheet 3,850 36,412 1,660 30,900

Present Value of Unfunded Obligation as at year end - - - -

Unrecognised Actuarial Gain/(Loss) - - - -

Unfunded Liability/(Asset) recognised in the Balance Sheet - - - -

(iv) Amount recognised in the Balance Sheet

Present value of obligations as at year end 126,818 68,286 109,641 55,509


Amount not recognised as an asset - - - -

Net (asset)/liability recognised as on 31st March, 2010 3,850 36,412 1,660 30,900

(v) Expenses recognised in the Profi t and Loss Account


Interest on defi ned benefi t obligation 7,919 3,719 7,711 3,169

Expected return on plan assets (10,081) (2,506) (8,152) (2,422)

Net actuarial loss/(gain) recognised in the current year (2,185) 6,926 6,715 8,686

Total expenses 12,307 22,322 21,310 24,512

(vi) Actual Return on Plan Assets


Actuarial gain/(loss) on Plan Assets 2,906 (198) (4,758) (386)

Actual Return on Plan Assets 12,987 2,308 3,394 2,036

(vii) Asset information

Administered by Birla Sunlife Insurance Co. Ltd. and LIC of India 100% 100% 100% 100%

(viii) Principal actuarial assumptions used

Discount rate (p.a.) 8.00% 8.00% 7.50% 7.50%

Expected rate of return on plan assets (p.a.) 9.00% 9.00% 9.00% 9.25%

(ix) Experience Analysis

Actuarial gain/(loss) on change in assumptions 6,297 (1,922) - -

Experience (Gain)/Loss on Liabilities (5,576) 8,650 - -

Actuarial gain/(loss) on Obligation 721 6,728 - -

(x) Expected employer’s contribution for the next year is Rs. 23,355 ('000) for Gratuity and Leave Encashment.



12. MANAGERIAL REMUNERATION

Rs. in (‘000s)

2009-2010 2008-2009

(a) Paid/payable to directors*

Salaries, Perquisites & Other benefi ts 23,821 53,060

Commission (Previous period amount includes commission Payable to

Non-executive director @ 1% of Profi t computed under Section 349).

957 27,766

Sitting Fees 720 350

Contribution to Provident Fund & Superannuation Fund 11,115 14,533

36,613 95,709

Name of Directors

1. Mr. Gracias Saldanha 120 25,882

2. Mrs. B. E. Saldanha 60 40

3. Mr. Glenn Saldanha 18,282 34,093

4. Mrs. Cheryl Pinto 9,409 15,011

5. Mr. R. V. Desai (resigned from the board eff ective from 1st April, 2009) - 9,190

6. Mr. A. S. Mohanty 8,202 11,213

7. Other Directors 540 280

* Excludes contributions to Gratuity and Leave Encashment Fund, which is

based on actuarial valuation.

(b) Computation of net profi ts in accordance with Section 349 and Section 309(5)

of the Companies Act, 1956.

Profi t before taxation as per Statement of Profi t and Loss 1,210,138 2,460,719

Add: Depreciation as per Statement of Profi t and Loss 212,778 191,045

Loss on sale of Generic business - 2,980

Provision for Doubtful Debts 17,500 30,000

1,440,416 2,684,744

Less: Depreciation calculated under Section 350 of the Companies Act, 1956 212,778 191,045

Profi t on sale of assets - 4,212

Net profi t in accordance with Section 349 1,227,638 2,489,487

Add: Managerial remuneration paid/payable to directors 36,613 95,709

Net profi t in accordance with Section 309(3) of the Companies Act, 1956 1,264,251 2,585,196

Maximum managerial remuneration allowed under Section 198 of the Companies

Act, 1956, 11 per cent of the above 139,068 284,372


13. CAPACITY, PRODUCTION, SALES AND STOCKS

(a) Capacities and actual production (including samples)

Class of goods UoM Installed Capacity Actual Production

2009-2010 2008-2009 2009-2010 2008-2009

Injections Ltrs - - 210,901 192,422

Liquid Orals Ltrs 12,036,666 8,166,666 4,175,057 5,002,682

Lotions and Externals Ltrs 2,367,500 626,250 708,052 511,193

Ointments and Creams Kgs 4,357,500 1,087,500 834,457 631,728

Solids and Powders Kgs 113,000 113,000 311,173 231,673

Tablets and Capsules Nos 1,182,950,000 1,180,800,000 784,299,349 752,893,839

Others - - 132,131 343,864

Notes:

i) The products of the Company are exempt from licencing procedures.

ii) Installed capacity, being a technical matter, has not been verifi ed by the auditors. However, the management has certifi ed

the same.

iii) Actual production includes goods manufactured at third party manufacturing facilities on loan licence basis and at

leased facilities.


(b) Sales

Class of goods UoM 2009-2010 2008-2009

Qty Value Qty Value

Rs. in ('000s) Rs. in ('000s)

Injectibles Ltrs 360,800 674,558 255,206 566,494

Liquid Orals Ltrs 4,464,608 1,411,501 4,859,858 1,676,725

Lotions and Externals Ltrs 845,595 1,033,321 697,124 820,983

Ointments and Creams Kgs 872,132 2,016,108 620,370 1,435,520

Solids and Powders Kgs 316,939 166,081 197,963 107,263

Tablets and Capsules Nos 1,124,223,930 4,153,827 757,502,380 3,408,056

Cardiac diagnostic services 15,292 14,436

Others 826,180 632,247

TOTAL 10,296,868 8,661,724

Notes:

1. Sales are net of sales returns.

2. Sales quantities does not include free issues, samples and breakages.

(c) Finished goods purchased (includes samples)

Class of goods UoM 2009-2010 2008-2009

Qty Value Qty Value

Rs. in ('000s) Rs. in ('000s)

Injectibles Ltrs 151,626 241,784 83,444 151,925

Liquid Orals Ltrs 137,390 45,539 176,880 52,408

Lotions and Externals Ltrs 100,869 41,752 249,752 115,818

Ointments and Creams Kgs 17,347 16,792 48,343 20,884

Solids and Powders Kgs - - - -

Tablets and Capsules Nos 322,750,466 436,830 105,128,406 345,779

Others - 58,799 - 413

TOTAL 841,496 687,227

(d) Raw and packing materials consumed

Products 2009-2010 2008-2009

Qty Value Qty Value

in kgs Rs. in ('000s) in kgs Rs. in ('000s)

Telmisartan BP 7,363 95,306 - -

Sugar S/30 Ih 1,461,206 49,841 1,862,804 35,153

Mupirocin Usp 316 49,087 268 39,074

100ML Amber Pet Bottles (25 mm Neck) 28,442,845 46,044 30,532,524 49,293

Propylene Glycol IP 366,813 33,319 - -

Lornoxicam IH 295 33,214 326 41,144

Eplerenone 101 31,604 84 33,632

Levofl oxacin Hemihydrate IP 11,537 31,353 10,910 42,671

Miglitol IH 479 31,290 455 34,018

Linezolid IH 1,560 31,205 1,242 25,134

Others 1,570,522 1,378,518

TOTAL 2,002,785 1,678,637




(e) Break-up of Materials and Consumable stores consumed

2009-2010 2008-2009

Value Per cent Value Per cent

Rs. in ('000s) Rs. in ('000s)

Materials

Imported materials 76,623 3.83 143,370 8.54

Indigenously procured 1,926,162 96.17 1,535,267 91.46

2,002,785 100.00 1,678,637 100.00

Consumable stores and spares

Imported - - - -

Indigenously procured 42,272 100.00 43,013 100.00

42,272 100.00 43,013 100.00

(f) Inventories of fi nished goods (manufactured and traded)

Opening Stock Closing Stock

2009-2010 2008-2009 2009-2010 2008-2009

Class of goods UoM Qty Value Qty Value Qty Value Qty Value

Rs. in (‘000s) Rs. in (‘000s) Rs. in (‘000s) Rs. in (‘000s)

Injectibles Ltrs 55,583 64,554 34,668 44,877 57,315 85,396 55,583 64,554

Liquid Orals Ltrs 719,115 96,640 394,256 61,613 566,946 63,978 719,115 96,640

Lotions and Externals Ltrs 190,778 59,852 136,458 38,028 154,111 51,401 190,778 59,852

Ointments and Creams Kgs 134,285 100,676 78,975 84,389 113,959 73,922 134,285 100,676

Solids and Powders Kgs 55,170 11,513 21,523 5,974 49,405 10,797 55,170 11,513

Tablets and Capsules Nos 207,546,567 378,131 163,171,004 427,357 190,372,456 233,737 207,546,567 378,131

Bulk Drugs Kgs - - 3,067 58,157 - - - -

Others - 4,402 - 25,216 - 107,686 - 4,402

TOTAL 715,768 745,611 626,917 715,768

14. SUBSIDIARY COMPANIES Rs. in (‘000s)


during the year As at

2009-2010 2008-2009 31st March, 2010 31st March, 2009

a) Loans and Advances to Subsidiaries

Glenmark Pharmaceuticals S.A., Switzerland 953,721 553,244 911,657 553,244

Glenmark Holding S.A., Switzerland 8,204,910 5,519,683 7,422,429 5,519,683

Glenmark Farmaceutica Ltda., Brazil 2,746 4,935 2,411 2,988

Glenmark Pharmaceuticals (Nigeria) Ltd., Nigeria 39,141 36,711 31,746 36,711

Glenmark Impex L.L.C., Russia 156,708 156,708 138,756 156,708

Glenmark Generics Ltd., India 52,754 533,427 - 380,220

Glenmark Pharmaceuticals Egypt S.A.E., Egypt 6,962 - - -

Glenmark Generics SA., Argentina 2,219 399 1,091 -

8,508,090 6,649,554

b) Interest-bearing loans to Subsidiary Companies

Glenmark Holding S.A., Switzerland. 8,112,070 4,836,426 7,011,506 4,836,426

Glenmark Pharmaceuticals (Nigeria) Ltd., Nigeria 31,226 26,757 29,341 26,757

Glenmark Impex L.L.C., Russia 144,117 137,358 135,417 137,358

Glenmark Pharmaceuticals Egypt S.A.E., Egypt 6,747 - - -


c) Receivable from Subsidiary Companies






Glenmark Exports Ltd., India 159,479 661,603

Glenmark Pharmaceuticals South Africa (Pty) Ltd.,

South Africa

395 -


d) Payable to Subsidiaries

Glenmark Pharmaceuticals FZE., U.A.E. 6,486 -


e) Movement of shares during the year

No. of Shares in ('000)

As at

1st April, 2009

Invested during

the Year

Sale during

the Year

Balance

as at 31st

March, 2010

Investments in Subsidiary Companies - Unquoted

- non-trade

Glenmark Impex L.L.C., Russia 266,741 188,961 - 455,702

Glenmark Philippines Inc., Philippines 497 143 - 640

Glenmark Pharmaceuticals (Nigeria) Ltd., Nigeria 157,116 110,417 - 267,533

Glenmark Pharmaceuticals Malaysia Sdn. Bhd., Malaysia 1,108 93 - 1,201


Glenmark Pharmaceuticals (Australia) Pty Ltd., Australia 1,861 115 - 1,976

Glenmark Pharmaceuticals Egypt S.A.E., Egypt 250 4,725 - 4,975

Glenmark Dominicana, SRL, Dominican Republic* 0* 0* - 0*

Investment in Joint Venture

Glenmark Pharmaceuticals (Thailand) Co. Ltd.

- Ordinary shares (Paid-Up 50 THB) - 16 - 16

* number less than 1,000

15. FOREIGN CURRENCY CONVERTIBLE BOND ISSUED

A) The Company had issued 30,000 Zero Coupon Foreign Currency Convertible Bonds of USD 1,000 each (Rs. 1,331,700 at issue)


on 29th November, 2010 at a fi xed exchange rate of Rs. 44.94 per 1 USD and the conversion price of Rs. 582.60 per share

of Re. 1 each.

(ii) Redeemable in whole but not in part at the option of the Company on or after 10th January, 2010 if closing price of the


given was at least 130% of the applicable Early Redemption Amount divided by the Conversion Ratio.

(iii) Redeemable on maturity date on 11th January, 2011 at 139.729% of its principal amount if not redeemed or converted

earlier. The redemption premium of 39.729% payable on maturity of the bond if there is no conversion of the bond

to be debited to Securities Premium Account evenly over the period of 5 years from the date of issue of bonds. As of

31st March, 2010, 30,000 FCC bonds (2009-30,000) of USD 1,000 each aggregating to USD 30 million are outstanding.

B) The Company had issued 20,000 Zero Coupon Foreign Currency Convertible Bonds of USD 1,000 each (Rs. 873,200 at issue)

(i) Convertible at the option of the bondholder at any time on or after 28th March, 2005 but prior to the close of business on

2nd January, 2010 at a fi xed exchange rate of Rs. 43.66 per 1 USD and price of Rs. 215.60 (Post adjustment for bonus and

split) per share of Re. 1 each.


Share for each of the 25 consecutive trading days immediately prior to the date upon which notice of such redemption is



earlier. The redemption premium of 33.74%payable on maturity of the Bond if there is no conversion of the Bond to be

debited to Securities Premium Account evenly over the period of 5 years from the date of issue of Bonds. During the year,

1,000 FCC Bonds of USD 1,000 each aggregating to USD 1 Million were redeemed on 16th February, 2010 on maturity.

As of 31st March, 2010, NIL FCC Bonds (2009 -1,000) of USD 1,000 each are outstanding.

C) The Company had issued 50,000 Zero Coupon Foreign Currency Convertible Bonds of USD 1,000 each (Rs. 2,183,000 at issue)


on 2nd January, 2010 at a fi xed exchange rate of Rs. 43.66 per 1 USD and the price of Rs. 253.11 (post adjustment for split)






earlier. The Redemption Premium of 34.07% payable on maturity of the Bond if there is no conversion of the Bond to be

debited to Securities Premium Account evenly over the period of 5 years from the date of issue of Bonds. During the year,

5,000 FCC Bonds of USD 1,000 each aggregating to USD 5 Million were redeemed on 16th February, 2010 on maturity.

As of 31st March, 2010, NIL FCC Bonds (2009 - 5,000) of USD 1,000 each are outstanding.


GLENMARK PHARMACEUTICALS LIMITED96



16. Extracts of Assets and Liabilities as on 31st March, 2010 and Income and Expenses for the year ended 31st March, 2010 related to

the interest of the Company [without elimination of the eff ect of transactions between the Company and Glenmark Pharmaceuticals

(Thailand) Co. Ltd., Thailand] have been extracted from the audited accounts.

Rs. in (‘000s)

Particulars 2009-2010 2008-2009

Assets

Net Fixed Assets including CWIP 5 -

Deferred Tax Asset 236 52

Cash Bank Balances 1,029 1,114

Loans and Advances 57 59

Liabilities

Current Liabilities 144 66

Income

Net Sales - -

Expenses

Selling and Operating expenses 1,269 325

Depreciation 1 -

Provision for Taxation including Deferred Tax (191) (49)

17. VALUE OF IMPORTS ON CIF BASIS

Capital Goods 77,916 182,620

Materials 150,438 114,254

228,354 296,874

18. EARNINGS IN FOREIGN CURRENCY

Export of goods calculated on FOB basis 2,649,149 2,068,524

Guarantee Commission 26,062 29,135

Interest on loan to subsidiaries 278,254 136,067

2,953,465 2,233,726

19. EXPENDITURE IN FOREIGN CURRENCY


Professional and Consultancy charges 36,940 19,756

Export promotional expenses and export commission 132,000 114,164

Salary and related expenses 99,650 115,908

Product registration expenses 47,584 36,892

Interest expenses 12,881 29,983

Others 222,218 159,216

596,834 528,150

20. DIVIDEND REMITTANCE IN FOREIGN CURRENCY

Number of Non-resident Shareholders 22 -

Number of Equity Shares held by them 163,240 -

Amount of dividend paid (Gross), TDS Rs. Nil (2009 – Rs. Nil) 65 -

Year to which dividend relates 2008-2009 -

21. PRIOR YEAR COMPARATIVES

Prior year's fi gures have been regrouped or reclassifi ed wherever necessary to confi rm to current year's classifi cation.

Signatures to the Schedules 1 to 21 which form an integral part of the Financial Statements.

For Price Waterhouse For and on behalf of the Board of DirectorsFirm Registration Number: 301112EChartered Accountants Partha Ghosh Glenn Saldanha Cheryl Pinto A. S. MohantyPartner Managing Director & CEO Director Director Membership Number: F-55913

Place: Mumbai Marshall MendonzaDate: 28th May, 2010 Vice President - Legal & Company Secretary

Additional information as required under Part IV of Schedule VI to the Companies Act, 1956.Balance Sheet Abstract & Company’s General Business Profi le

Rs. in (‘000s)

(a) Registration Details

Registration No. 1 9 9 8 2 State Code 1 1

Date Month Year

Balance Sheet Date 3 1 0 3 2 0 1 0

(b) Capital raised during the year

Public Issue Rights Issue

N I L N I L

Bonus Issue Qualifi ed Institutions Placement Issue

N I L 1 8 7 1 3

Preferential off er of shares under

Employee stock option scheme Conversion of FCC Bond

6 0 5 N I L

(c) Position of mobilisation and deployment of funds

Total Liabilities including Shareholders Funds Total Assets

2 7 7 3 6 1 9 6 2 7 7 3 6 1 9 6

SOURCES OF FUNDS

Paid-up Capital Reserves and Surplus

2 6 9 8 3 8 1 7 4 6 4 3 1 6

Secured Loans Unsecured Loans

4 8 6 4 0 3 7 1 1 1 1 5 0

Deferred Tax Liability

3 2 7 7 1 3

APPLICATION OF FUNDS

Net Fixed Assets Investments

2 3 7 2 9 0 6 9 9 2 9 1 9 1

Net Current Assets Miscellaneous Expenditure

1 3 2 6 0 5 9 6 N I L

Deferred Tax Assets Accumulated Losses

9 6 7 2 7 N I L

(d) Performance of the Company

Turnover (Total Income) Total Expenditure

1 0 3 8 8 7 6 5 9 1 7 8 6 2 7

Profi t/(Loss) Before Tax Profi t/(Loss) After Tax

1 2 1 0 1 3 8 1 2 8 4 6 3 2

Basic Earnings per Share in Rs. Diluted Earnings per Share in Rs.

4 . 9 3 4 . 9 2

Dividend Rate %

4 0

(e) Generic Names of Three Principal Products of Company

Item Code No. (ITC code) Product Description

3 0 0 4 2 0 . 3 9 Levofl oxacin

3 0 0 4 9 0 . 6 9 Lornoxicam

3 0 0 4 9 0 . 7 9 Telmisartan


ANNUAL REPORT 2009-2010

Stat

emen

t Pur

suan

t to

Sect

ion

212

of th

e Co

mpa

nies

Act

, 195

6.Re

latin

g to

Com

pany

’s in

tere

st in

Sub

sidia

ry C

ompa

nies

;N

o.N

ame

of th

e Co

mpa

nyGl

enm

ark

Expo

rts

Lim

ited

Glen

mar

k Ge

neric

s Li

mite

d

Glen

mar

k Im

pex

L.L.

C.

Glen

mar

k Fa

rmac

eutic

a ltd

a.

Glen

mar

k Ge

neric

s (E

urop

e)

Ltd.

Glen

mar

k Ph

ilipp

ines

In

c.,

Glen

mar

k Ge

neric

s In

c., U

SA

Glen

mar

k Ph

arm

aceu

tical

s (N

iger

ia) L

td.

Glen

mar

k D

omin

ican

a SR

L

Glen

mar

k Ph

arm

aceu

tical

s (M

alay

sia)

SD

N.B

HD

Glen

mar

k Ph

arm

aceu

-tic

als S

.A.,

Switz

erla

nd

Glen

mar

k So

uth

Afric

a (P

ty)

Ltd.

Glen

mar

k Ge

neric

s S.A

. Ar

gent

ina

Glen

mar

k Ph

arm

aceu

tical

s (A

ustr

alia

) Pt

y Lt

d.

Glen

mar

k Ph

arm

aceu

tical

s So

uth

Afric

a (P

ty) L

td.

Glen

mar

k H

oldi

ng

S.A.

Glen

mar

k Ph

arm

a-ce

utic

als

SRO

Glen

mar

k Ph

arm

aceu

-tic

als S

.R.L

.

Glen

mar

k Ph

arm

a-ce

utic

als

Euro

pe

Ltd.

Glen

mar

k Ge

neric

s H

oldi

ng

S.A.

Glen

mar

k Ge

neric

s Fi

nanc

e S.

A.

Glen

mar

k Ph

arm

a-ce

utic

als

EOO

D

Glen

mar

k Ph

arm

a-ce

utic

als

Colo

mbi

a Lt

da

Glen

mar

k Ph

arm

a-ce

utic

als

Peru

S.

A.C

Glen

mar

k Th

erap

eu-

tics I

nc.,

USA

Glen

mar

k Ph

arm

a-ce

utic

als

Egyp

t S.

A.E.

Glen

mar

k Ph

arm

a-ce

utic

als

SP. Z

.O.O

.

Glen

mar

k Ph

arm

a-ce

utic

als

F.Z.

E.

Glen

mar

k Ph

arm

aceu

-tic

als M

exic

o,

SA D

E CV

Glen

mar

k Ph

arm

a-ce

utic

als

Vene

zuel

a,

CA

Glen

mar

k Ur

ugua

y SA

Glen

mar

k Ph

arm

a-ce

utic

als S

K SR

O

Glen

mar

k D

istr

ibut

ors

SP Z

.O.O

.

1.Th

e fi n

anci

al

year

of t

he

Subs

idia

ry

Com

pani

es

ende

d

31-M

ar-1

031

-Mar

-10

31-M

ar-1

031

-Mar

-10

31-M

ar-1

031

-Mar

-10

31-M

ar-1

031

-Mar

-10

31-M

ar-1

031

-Mar

-10

31-M

ar-1

031

-Mar

-10

31-M

ar-1

031

-Mar

-10

31-M

ar-1

031

-Mar

-10

31-M

ar-1

031

-Mar

-10

31-M

ar-1

031

-Mar

-10

31-M

ar-1

031

-Mar

-10

31-M

ar-1

031

-Mar

-10

31-M

ar-1

031

-Mar

-10

31-M

ar-1

031

-Mar

-10

31-M

ar-1

031

-Mar

-10

31-M

ar-1

031

-Mar

-10

31-M

ar-1

0

2.Da

te fr

om

whi

ch th

ey

beca

me

subs

idia

ry

10-S

ep-9

615

-Sep

-04

7-M

ay-0

1No

t Ap

plic

able

. (W

holly

ow

ned

subs

idia

ry

of G

lenm

ark

Hold

ing

S.A.

, Sw

itzer

land

)

Not

Appl

icab

le.

(Who

lly

owne

d su

bsid

iary

of

Gl

enm

ark

Gene

rics

Lim

ited)

28-Ja

n-04

Not

Appl

icab

le.

(Who

lly

owne

d su

bsid

iary

of

Gle

nmar

k Ge

neric

s Ho

ldin

g S.

A.)

28-A

pr-0

41-

Jun-

0422

-Jul-0

4No

t Ap

plic

able

. (W

holly

ow

ned

subs

idia

ry

of G

lenm

ark

Hold

ing

S.A.

, Sw

itzer

land

)

Not

Appl

icab

le.

(Who

lly

owne

d su

bsid

iary

of

Gle

nmar

k Ho

ldin

g S.

A.,

Switz

erla

nd)

Not

Appl

icab

le.

(Who

lly

owne

d su

bsid

iary

of

Gle

nmar

k Ge

neric

s Ho

ldin

g S.

A.)

31-M

ar-0

6No

t App

licab

le.

(Who

lly o

wne

d su

bsid

iary

of

Glen

mar

k So

uth

Afric

a (P

ty) L

td.

17-M

ay-0

6No

t Ap

plic

able

. (W

holly

ow

ned

subs

idia

ry

of

Glen

mar

k Ho

ldin

g S.

A)

Not

Appl

icab

le.

(Who

lly

owne

d su

bsid

iary

of

Gle

nmar

k Ho

ldin

g S.

A)

Not

Appl

icab

le.

(Who

lly

owne

d su

bsid

iary

of

Gle

nmar

k Ho

ldin

g S.

A)

Not

Appl

icab

le.

(Who

lly

owne

d su

bsid

iary

of

Gle

nmar

k Ge

neric

s Fi

nanc

e S.

A)

Not

Appl

icab

le.

(Who

lly

owne

d su

bsid

iary

of

Gl

enm

ark

Gene

rics

Lim

ited)

Not

Appl

icab

le.

(Who

lly

owne

d su

bsid

iary

of

Gl

enm

ark

Hold

ing

S.A.

)

Not

Appl

icab

le.

(Who

lly

owne

d su

bsid

iary

of

Gl

enm

ark

Urug

uay

S.A.

)

Not

Appl

icab

le.

(Who

lly

owne

d su

bsid

iary

of

Gl

enm

ark

Urug

uay

S.A.

)

Not

Appl

icab

le.

(Who

lly

owne

d su

bsid

iary

of

Gl

enm

ark

Hold

ing

S.A.

)

6-No

v-08

Not

Appl

icab

le.

(Who

lly

owne

d su

bsid

iary

of

Gl

enm

ark

Hold

ing

S.A.

)

19-N

ov-0

8No

t Ap

plic

able

. (W

holly

ow

ned

subs

idia

ry

of G

lenm

ark

Urug

uay,

S.A.

)

Not

Appl

icab

le.

(Who

lly

owne

d su

bsid

iary

of

Gle

nmar

k Ur

ugua

y, S.

A..)

Not

Appl

icab

le.

(Who

lly

owne

d su

bsid

iary

of

Gle

nmar

k Ho

ldin

g S.

A.)

Not

Appl

icabl

e (W

holly

ow

ned

subs

idia

ry

of G

lenm

ark

Phar

ma-

ceut

icals

SRO)

Not

Appl

icab

le.

(Who

lly

owne

d su

bsid

iary

of

Gle

nmar

k Ho

ldin

g S.

A.)

3. a

.Nu

mbe

r of

shar

es h

eld

by G

lenm

ark

Phar

ma-

ceut

ical

s Lt

d. in

the

subs

idia

ry

com

pani

es

at th

e en

d of

fi n

anci

al y

ear

of S

ubsid

iary

Co

mpa

nies

1,85

0,02

0 Eq

uity

Sh

ares

of

Rs.1

0/-

each

fully

pa

id u

p

143,

210,

000

Equi

ty

Shar

es

of R

s.10

each

fully

pa

id u

p.

455,

701,

648

Equi

ty

Shar

es

of R

UB 1

ea

ch.

Not

Appl

icab

le

(177

,084

,654

sh

ares

of B

RL

1 ea

ch h

eld

by G

lenm

ark

Hold

ing

S.A.

)

Not

Appl

icab

le

(6,2

85,1

21

Ord

inar

y sh

ares

of

GBP

1 ea

ch

held

by

Glen

mar

k Ge

neric

s Li

mite

d)

640,

490

shar

es o

f 20

0 Pe

sos

each

Not

Appl

icab

le

(42,

665,

819

shar

es o

f US

$ 1

each

he

ld b

y Gl

enm

ark

Gene

rics

Hold

ing

S.A)

267,

533,

341

Ord

inar

y sh

ares

of

Nai

ra 1

eac

h.

RD 1

00,0

00

divi

ded

into

10

0 sh

ares

of

RD

1,00

0 ea

ch.

1,20

0,86

1 O

rdin

ary

shar

es

of R

M 1

eac

h.

Not A

pplic

able

(3

,000

,000

sh

ares

of C

HF

1 ea

ch h

eld

by G

lenm

ark

Hold

ing

S.A.

)

Not

Appl

icab

le

(83,

656

Ord

inar

y sh

ares

of R

1.

00 (R

and)

ea

ch h

eld

by

Glen

mar

k Ho

ldin

g S.

A.,

Switz

erla

nd)

Not

Appl

icab

le.

(1,6

86,4

87

shar

es h

eld

by G

lenm

ark

Gene

rics

(Eur

ope)

Ltd

,. &

92,5

00,6

10

shar

es o

f 1

AR$

each

hel

d by

Gle

nmar

k Ge

neric

s Ho

ldin

g S.

A.)

1,97

6,00

2 sh

ares

of

AUD

1 e

ach

Not A

pplic

able

.( 50

0 Eq

uity

shar

es

of R

1 e

ach

held

by

Gle

nmar

k So

uth

Afric

a (P

ty) L

td.)

22,5

20,0

00

Shar

es

of C

HF 1

ea

ch

Not

Appl

icab

le.

(297

,371

sh

ares

of

CZK

76

0 ea

ch

held

by

Glen

mar

k Ho

ldin

g S.

A.)

Not

Appl

icab

le.

(1,5

51,1

36

shar

es o

f RO

N 1

each

he

ld b

y Gl

enm

ark

Hold

ing

S.A)

Not

Appl

icab

le.

(4,1

00,7

08

shar

e of

GB

P 1

each

he

ld b

y Gl

enm

ark

Hold

ing

S.A)

Not

Appl

icab

le.

(215

,600

,000

sh

ares

of

CHF

1 ea

ch

held

by

Glen

mar

k Ge

neric

s Fi

nanc

e S.

A)

Not

Appl

icab

le.

(2,7

50,0

00

shar

es o

f CH

F 1

each

he

ld b

y Gl

enm

ark

Gene

rics

Lim

ited)

Not

Appl

icab

le.

(5 sh

ares

of

BGN

10

00 e

ach

held

by

Glen

mar

k Ho

ldin

g S.

A.)

Not

Appl

icab

le

(900

0 sh

ares

of

Cop

10

00 e

ach

hedl

by

Glen

mar

k Ur

ugua

y S.

A.)

Not

Appl

icab

le.

2,80

0 sh

ares

of

Sole

1 e

ach

held

by

Glen

mar

k Ur

ugua

y S.

A.

Not

Appl

icab

le.

5,57

0,00

0 sh

ares

of

USD

1 ea

ch

held

by

Glen

mar

k Ho

ldin

g S.

A.

4,97

5,15

4 sh

ares

of

EGP

1

each

Not

Appl

icab

le

4,40

0 sh

ares

of

PLN

50

0 ea

ch

held

by

Glen

mar

k Ho

ldin

g S.

A.

1 sh

are

of A

ED

1,00

0,00

0 ea

ch

Not

Appl

icab

le.

37,7

92,3

60

shar

es o

f 1

Mex

ican

Pes

o ea

ch h

eld

Glen

mar

k Ur

ugua

y, S.

A

Not

Appl

icab

le.

10,6

91

shar

es o

f Bs

1 e

ach

held

by

Glen

mar

k Ur

ugua

y, S.

A.

Not

Appl

icab

le.

152,

082,

634

shar

es o

f 1

Urug

uaya

n Pe

so e

ach

held

by

Glen

mar

k Ho

ldin

g S.

A.

Not

Appl

icab

le.

6,63

9 sh

ares

of

EUR

1

each

hel

d by

Gl

enm

ark

Phar

ma-

ceut

ical

s SR

O

Not

Appl

icab

le.

3,70

0 sh

ares

of

PLN

500

ea

ch h

eld

by

Glen

mar

k Ho

ldin

g S.

A.

3.b.

Exte

nt o

f in

tere

st o

f ho

ldin

g Co

mpa

ny a

t th

e en

d of

th

e fi n

anci

al

year

of t

he

subs

idia

ry

com

pani

es

100%

97%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

4. Th

e ne

t ag

greg

ate

amou

nt

of th

e su

bsid

iary

co

mpa

nies

’ Pr

ofi t/

(Los

s)

so fa

r as i

t co

ncer

ns th

e m

embe

rs o

f th

e ho

ldin

g co

mpa

ny:

4.a.

Not

dea

lt w

ithin

the

hold

ing

com

pany

’s ac

coun

ts:

4.a.

1. F

or th

e fi n

anci

al y

ear

ende

d 31

st

Mar

ch, 2

010

(Rs '

000

)

Nil

1,4

89,0

76

664

,392

1

73,7

44

(23,

700)

(9,8

71)

254

,092

4

,627

(1

33)

(3,0

24)

(674

,621

) (1

08)

(56,

242)

(15,

349)

13,

583

493

,452

(3

18,9

53)

(98,

045)

5,6

20

17,

772

(63,

675)

(2,9

28)

(131

) 3

,906

(9

,196

) (1

8,10

9) 2

0,35

0 6

,181

(9

6,74

5) (8

4,76

3) (3

2,08

4) 3

,686

(1

,546

)

4.a.

2.Fo

r the

pr

evio

us

fi nan

cial

ye

ars o

f the

Su

bsid

iary

Co

mpa

nies

sin

ce th

ey

beca

me

the

hold

ing

com

pany

’s su

bsid

iarie

s(R

s. ‘0

00)

7,37

8 1

,038

,118

4

15,8

23

1,5

19,4

40

(14,

344)

(26,

743)

493

,282

(3

3,95

0)N

il (1

0,56

7) 1

,557

,098

(5

,455

)(1

57,3

33)

(57,

440)

(19,

530)

6,02

6,20

5(2

50,5

09)

(54,

412)

(8,2

21)

(86,

374)

(148

,157

)(2

0,44

6)N.

A. (2

0,30

0) (1

5,66

8)(2

,250

) (4

3,67

1) (3

,977

) (1

5,55

5) (1

9,63

1)(1

499)

(2,1

34)

(1,9

48)

4.b.

Dea

lt w

ithin

th

e ho

ldin

g co

mpa

ny’s

acco

unts

:

4.b.

1. F

or th

e fi n

anci

al y

ear

ende

d 31

st

Mar

ch, 2

010

(Rs '

000

)

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

4.b.

2.Fo

r the

pr

evio

us

fi nan

cial

ye

ars o

f the

su

bsid

iary

co

mpa

nies

sin

ce th

ey

beca

me

the

hold

ing

com

pany

’s su

bsid

iarie

s

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Nil

99

No.

Nam

e of

the

Com

pany

Glen

mar

k Ex

port

s Li

mite

d

Glen

mar

k Ge

neric

s Li

mite

d

Glen

mar

k Im

pex

L.L.

C.

Glen

mar

k Fa

rmac

eutic

a ltd

a.

Glen

mar

k Ge

neric

s (E

urop

e)

Ltd.

Glen

mar

k Ph

ilipp

ines

In

c.,

Glen

mar

k Ge

neric

s In

c., U

SA

Glen

mar

k Ph

arm

aceu

tical

s (N

iger

ia) L

td.

Glen

mar

k D

omin

ican

a SR

L

Glen

mar

k Ph

arm

aceu

tical

s (M

alay

sia)

SD

N.B

HD

Glen

mar

k Ph

arm

aceu

-tic

als S

.A.,

Switz

erla

nd

Glen

mar

k So

uth

Afric

a (P

ty)

Ltd.

Glen

mar

k Ge

neric

s S.A

. Ar

gent

ina

Glen

mar

k Ph

arm

aceu

tical

s (A

ustr

alia

) Pt

y Lt

d.

Glen

mar

k Ph

arm

aceu

tical

s So

uth

Afric

a (P

ty) L

td.

Glen

mar

k H

oldi

ng

S.A.

Glen

mar

k Ph

arm

a-ce

utic

als

SRO

Glen

mar

k Ph

arm

aceu

-tic

als S

.R.L

.

Glen

mar

k Ph

arm

a-ce

utic

als

Euro

pe

Ltd.

Glen

mar

k Ge

neric

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k Ge

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k Ph

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k Ph

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k Ph

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Peru

S.

A.C

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k Th

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F.Z.

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k Ur

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k Ph

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O

Glen

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k D

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.

5.Cu

rrenc

yRs

.Rs

.US

$BR

LGB

PPH

PUS

$NG

NRD

RMCH

FZA

RPE

SOAU

DZA

RCH

FCZ

KRO

NGB

PCH

FCH

FBG

NUS

$PE

NUS

$EG

YPL

NAE

DM

XNUS

$UY

UEU

ROPL

N

6.Ex

chan

fge

Rate

-

-45

.14

25.1

467

.87

1.00

45.1

40.

301.

2513

.70

42.3

26.

1111

.64

41.4

16.

1142

.32

2.38

14.9

267

.87

42.3

242

.32

30.9

845

.14

16.0

345

.14

8.24

15.6

512

.26

3.63

45.1

42.

3560

.59

15.6

5

7.Sh

are

Capi

tal

18,

500

1,4

96,0

30

722

,279

4

,364

,104

5

18,0

89

116

,703

1

,925

,935

8

6,60

9 1

22

15,

286

106

,761

2

19,4

41

1,0

96,6

20

65,

047

25,

905

797

,113

1

43,0

16

252

,887

3

29,5

55

9,7

93,8

02

120

,827

3

2,52

3 3

,662

7

9,74

7 2

57,5

52

42,

940

39,

419

12,

925

159

,298

2

,009

3

31,2

73

457

2

7,68

9

8.Re

serv

es 7

,378

8

,963

,094

1

,027

,523

2

,359

,465

(1

24,3

48)

(27,

778)

742

,501

(3

0,00

1) (1

22)

(13,

259)

1,1

82,3

14

(50,

209)

(185

,982

) (6

4,27

4) (4

,598

) 7

,759

,756

1

,098

,332

(1

50,0

75)

(53,

290)

(751

,045

) 1

37,5

28

(24,

150)

(123

) (1

6,87

7) (2

9,91

5) (2

1,10

8) 7

4,61

0 1

,648

(1

11,0

87)

(36,

038)

(3,1

10)

1,8

89 (1

,889

)

9.To

tal A

sset

s 1

85,3

57

19,

260,

112

2,5

01,4

48

7,0

05,7

04

862

,189

1

17,9

10

10,

037,

467

105

,486

-

2,0

85

4,9

96,4

26

169

,327

1

,065

,024

9

78 1

58,1

76

20,

991,

673

2,2

14,7

75

391

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2

83,5

33

13,

708,

990

13,

030,

275

8,7

45 4

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6

7,98

7 2

56,9

89

23,

014

130

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1

7,67

4 7

1,29

3 5

6,16

0 3

29,1

54

55,

139

215

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10.

Tota

l Li

abili

ties

159

,479

8

,800

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7

51,6

46

282

,135

4

68,4

48

28,

985

7,3

69,0

31

48,

878

- 5

8 3

,707

,351

9

5 1

54,3

86

205

1

36,8

69

12,

434,

804

973

,427

2

88,9

91

7,2

68

4,6

66,2

33

12,

771,

920

372

989

5

,117

2

9,35

2 1

,182

1

6,68

9 3

,101

2

3,08

2 9

0,18

9 9

91 5

2,79

3 1

89,8

46

11.

Inve

stm

ent

(exc

ept

in ca

se o

f in

vest

men

t in

su

bsid

iarie

s)

- -

- -

- -

- -

- -

- -

- -

- -

- -

- -

- -

- -

- -

- -

- -

- -

12.

Turn

over

- 8

,261

,754

2

,260

,350

1

,208

,920

2

99,3

81

119

,543

7

,793

,249

9

0,10

1 -

- 2

4,66

9 -

346

,876

-

269

,831

-

1,0

59,5

02

315

,395

1

16,3

43

- -

- -

- -

408

3

18,2

93

- 3

2,03

4 3

,678

-

122

,114

3

47,7

97

13.

Profi

t be

fore

Tax

- 1

,708

,169

8

36,0

19

186

,254

(3

7,36

8) (9

,766

) 4

38,0

89

6,0

97 (1

33)

(3,0

24)

(670

,978

) (1

08)

(82,

451)

(15,

349)

21,

844

525

,330

(3

21,5

31)

(97,

864)

5,6

23

26,

921

(59,

978)

(2,9

28)

(129

) 3

,906

(8,9

89)

(17,

573)

27,

827

6,1

81

(105

,724

) (8

4,76

3) (3

0,58

5) 4

,696

(1

,615

)

14.

Prov

ision

fo

r Tax

- 2

19,0

93

171

,627

1

2,51

0 (1

3,66

8) 1

05

183

,998

1

,470

-

- 3

,643

-

(26,

209)

- 8

,261

3

1,87

8 (2

,578

) 1

81

3

9,1

49

3,6

97

- 2

-

207

5

36

7,4

77

- (8

,979

) -

1,4

99

1,0

10

(69)

15.

Profi

t af

ter T

ax -

1,4

89,0

76

664

,392

1

73,7

44

(23,

700)

(9,8

71)

254

,092

4

,627

(133

) (3

,024

) (6

74,6

21)

(108

) (5

6,24

2) (1

5,34

9) 1

3,58

3 4

93,4

52

(318

,953

) (9

8,04

5) 5

,620

1

7,77

2 (6

3,67

5) (2

,928

) (1

31)

3,9

06

(9,1

96)

(18,

109)

20,

350

6,1

81

(96,

745)

(84,

763)

(32,

084)

3,6

86

(1,5

46)

16.

Prop

osed

Di

vide

nd -

- -

- -

- -

- -

- -

- -

- -

- -

- -

- -

- -

- -

- -

- -

- -

- -

Stat

emen

t Pur

suan

t to

Sect

ion

212

of th

e Co

mpa

nies

Act

, 195

6.Re

latin

g to

Com

pany

’s in

tere

st in

Sub

sidia

ry C

ompa

nies

; (Co

ntd.

)

Fo

r and

on

beha

lf of

the

Boar

d of

Dire

ctor

s

G

lenn

Sal

danh

a Ch

eryl

Pin

to

A. S

. Moh

anty

M

anag

ing

Dire

ctor

& C

EO

Dire

ctor

D

irect

or

Plac

e: M

umba

i

Mar

shal

l Men

donz

aD

ate:

28t

h M

ay, 2

010

Vi

ce P

resi

dent

- Le

gal &

Com

pany

Sec

reta

ry


(Rs.

' 000

)