1

INDEX

SL. NO.

CONTENT

PAGE NO.

INTRODUCTION

2-3

4-8

SOURCES OF
FINANCE
ANALYSIS OF
SOUSES
BALANCE SHEET

CAPITAL STRUCTURE

11

COST OF CAPITAL

12-14

CAPITAL BUDGETING
DECISION
REFERENCES

15-16

Aanjaneya Lifecare Limited

9
10

16

(A) Introduction
Vision:
Dr. Datson strives to be the premier provider to the pharmaceutical industries for
development and commercialization of new medical therapies in anti cancer and anti malarial
worldwide.

Mission:
To combine the strength of our expertise,experience,and innovation to advance in the
worldwide success of the pharmaceutical industries in preventing and curing disease .
Aanjaneya Lifecare Ltd is a vertically integrated pharmaceutical company with
manufacturing and marketing capabilities in API (Active Pharmaceutical Ingredients) with
focus on anti-malarial, and Finished Dosage Forms (FDF) catering to various therapeutic
segments. Aanjaneya Lifecare Ltd was incorporated on January 3, 2006 as a private limited
company. The company is presently manufacturing second generation anti malarial which are
Quinine and its salts. The company has launched brands such as Anjtil (diareahhea),
Rankorex (cough syrup), Doktor Qure (pain management), Prosils (herbal lozenges), EsyHil
(crack heel cream), Aanmycin (skin - anti fungal) under the branded generic segment in the
domestic market. They have also launched these brands in the semi regulated markets like
Kenya, Tanzania, Haiti, Egypt, Domnican Republic and Jamaica.
In the year 2008, the company increased the manufacturing capacity from 200,000 kg per
annum to 360,000 kg per annum. In the year 2009, the company further increased the
manufacturing capacity from 360,000 kg per annum to 450,000 kg per annum. In the year
2011, the company was recognized as an export house by the Zonal Joint Director General of
Foreign Trade. They launched products like Aanrich, Actipros (asthma), Ulsacare (mouth
ulcers), Apticatch (appetite enhancer in kids), Anjeniya Curcumacare (prostate cancer) and
Nicco-nil (smoking de-addiction) under the branded generic segment in the domestic market.
The company plans to establish their presence in the international markets including Russia,
Middle East, Central and Latin America, South East Asia, South Africa, Cyprus and Greece.

Members

NAME
Mr. Mahesh Vaidya
Mr. Minhaj Khan
Dr. Rajendra Kumar
Mr. Pravat K Goyal
Mr.Shashikant B. Shinde
Mr. Giridhar G. Pulleti

Designation
Chairman
Nonexecutive and Independent Dir.
Vice Chairman & Managing Director
Whole Time Director
Whole Time Director
Nonexecutive Director

PRODUCT PROFILE
PRODUCT NAMES

THERAPEUTIC CATAGORY

1.ARTESUNATE

ANTI MALARIALS

2. ARTE METHER

ANTI MALARIALS

3. PERINOPRIL ERBUMIN

ACE INHIBITOR

4. TADALAFILE`

ERECTILE DYSFUTION

5.RAFOXANIDE

ANIMAL HEALTH PRODUCT

6.DOCETAXEL ANHYDROUS

ANTI CANCER

7.SEMI SYNTHETIC PACLITAXEL

ANTI CANCER

8.CAPICITABINE

ANTI CANCER

9.GAFITINIB

ANTI CANCER

10. METFORMIN

DIABETIC

(B .1) Sourses of finance (In Cr.....)

YEARS
SOURCES

MAR 2014

MAR 2013

MAR 2012

MAR 2011

MAR 2010

SHARE CAPITAL

31.66

13.89

13.89

7.58

5.78

RESERVES &
SURPLUS

376.21

295.58

335.91

126.81

44.00

SECURED LOAN

215.99

179.76

193.95

123.35

49.59

UNSECURED LOAN

278.73

370.45

104.79

15.60

10.10

LOAN IN ADVANCE

130.14

18.88

16.84

4.30

3.49

Calculation of sources in yearly wise:

In Cr........

Mar-14
31.66
376.21
215.99
278.73
130.14

SHARE CAPITAL
RESERVES AND SURPLUS
SECURED LOAN
UNSECURED LOAN
LOAN IN ADVANCE
TOTAL CAPITAL FROM
SOURSES(YR)
1032.73

Mar-13
13.89
295.58
179.76
370.45
18.18

Mar-12
13.89
335.91
193.95
104.79
16.84

Mar-11
7.58
126.81
123.35
15.6
4.3

Mar-10
5.78
44
49.59
10.1
3.49

877.86

665.38

277.64

112.96

Mar-13
1.58%
33.67%
20.47%
42.14%
2.07%

Mar-12
2.08%
50.48%
29.14%
15.74%
2.53%

Mar-11
2.73%
45.67%
44.42%
5.60%
1.54%

Mar-10
5.11%
38.95%
43.90%
8.94%
3.08%

PARCENTAGE (%)CHANGES
YEARLY
SHARE CAPITAL
REERVES AND SURPLUS
SECURED LOAN
UNSECURED LOAN
LOAN IN ADVANCED

Mar-14
3.06%
36.42%
20.91%
26.98%
12.60%

BAR CHART PRESENTETATION (Total sources 2010- 2014)

60.00%
50.00%
40.00%

SHARE CAPITAL
RESERVE AND SURPLUS

30.00%

SECURED LOAN
UNSECURED LOAN

20.00%

LOAN IN ADVANCE

10.00%
0.00%
41699

41334

40969

40603

40238

Presentation of Individual sources in year wise

SHARE CAPITAL
41699

41334

40969

35%

40603

40238

21%

11%
19% 14%

RESERVE AND SURPLUS

41699

41334

40969

19% 18%
22%

16%
25%

40603

40238

SECURED LOAN
41699

41334

40969

40603

40238

13%

28%

13%

28%

18%

UNSECURED LOAN
41699

41334

40969

6%
16%

9%

27%

42%

40603

40238

LOAN IN ADVANCE
41699

41334

40969

40603

14%
7%
12%

58%

9%

PEER COMPANIES

1.SUN PHARMACEUTICAL INDUSTRIES LTD.

2. DR. REDDYS LABORATORIES LTD.
3.CIPLA LTD
4.CANDILA HEALTH CARE LTD.
5.BIOCON LTD.
6.NACTO PHARMA LTD.
7.TORRENT PHARMACEUTICAL LTD.
8. WINTAC LTD.
9. KOPRAN LTD.
10. LYKA LAB LTD.

Comparison with Cipla Pharma Ltd

40238

Cipla Limited is an Indian multinational pharmaceutical and biotechnology company,

headquartered in Mumbai, India. It was Incorporated in 1935.

Some Products name

1. Abacavir

6.Acyclovin

2. Acitretin

7.Adapalane

3. Acetaminophin

8.Albendazole

4.Alendronate

9.Albuterol

5.Alfuzosin

10.Bisacodyle

(B.2) SOURCES OF FINANCE(CIPLA)

YEARS
SOURCES

MAR 2014

MAR 2013

MAR 2012

MAR 2011

MAR 2010

SHARE CAPITAL

160.58

160.58

160.58

160.58

160.58

RESERVES &
SURPLUS

9922.09

8699.97

7380.73

6443.40

5744.54

SECURED LOAN

0.00

9.49

10.00

2.95

0.41

UNSECURED LOAN

877.34

956.32

2.292

438.44

4.66

1150.69

1029.10

1213.66

1292.28

2357.29

LOAN IN
ADVANCE

Calculation of sources in yearly wise:

9
In Cr......
SHARE CAPITAL
RESERVED AND SURPLACE
SECURED LOAN
UNSECURED LOAN
LOAN AND ADVANCE

TOTAL capital from sources

(Yr)
Parentage(%)
yearly

Mar14
160.5
8
9922.
09
0
877.3
4
1150.
69
12110
.7

Mar-13

Mar-12

160.58

160.58

8699.9
7
9.49
956.32

7380.7
3
10
2.292

1029.1
10855.
46

1213.6
6
8767.2
62

Mar14
1.32%
81.92
%
0
7.24%
9.50%

Mar-13

Mar-12

1.47%
80.14

1.83%
84.18
%
0.11%
0.02%
13.84
%

Mar11
160.5
8
6743.
4
2.95
438.4
4
1292.
28
8637.
65

Mar10
160.5
8
5744.
54
0.41
4.66

Mar11
1.85%
78.06
%
0.03%
5.42%
14.96
%

Mar10
1.94%
69.48
%
0.04%
0.05%
28.51
%

2357.
29
8267.
48

change

SHARE CAPITAL
RESERVED AND SURPLUS
SECURED LOAN
UNSECURED LOAN
LOAN AND ADVANCE

0.08%
8.80%
9.48%

(C) Sources of finance analysis Aanjaneya Lifecare with Cipla

Anjayeneya lifecare limited

1.Share capital
The number of share capital of the company
increase in 2014 by 3.06% as compare to the
other previous year.In the previous two year
it must be constant whether it is issued
subscribed and fully paid and subscribed but
not fully paid.Shares in respect of the each
class is held by subsidiary company
2. Reserve and Surplus
Reserve and surplus of the company increase
in 2011-2012 by 50.48% from 45.67% and
further increased by 36.42 % from 33.67%
.this shows that the company having more
reserve which can be used by further issuing

Cipla

1.Share capital
The number of share capital of the company
same in all the year 160.58 in crore but a few
difference in percentage. This shows that the
number of share capital of the company
same in the previous year whether it is
subscribed or issued.
2.Reserve and Surplus
Reserve and surplus of the company
continuously increasing from previous year
like 81 % ,80.14% ,81.4%and This shows
that company going to proper year to year.
The company having good solvency position.

10

of shares or might be other purpose. That

means the company looking forward for good
solvency position.
3. Secured Loan
It is increased in 2010-2011 about 44.42%
but going forward company recovery would
start it would decreased in 2014 by 20.91%.It
means company is trying to recovery loans.

3.Secured Loan
This company having very less secured
loan .In all the previous year it never exceed
0.11% that is very good for the company.

4. Unsecured loan and advance

Unsecured loans are decrease in 2013-2014
by 29.98% from 42.61%.But advanced loan
is increased by 2.07%from 12.60% in 20132014 .

4.Unsecured loan and advance

In 2014 is was decreased as compared to the
previous year.This show that in 2014
company able to control there expenses

(D) BALANCE SHEET of Anjayena Lifecare Ltd.

Rs in Cr.
Rs. in Cr.

Mar 2014

Mar 2013

Mar 2012

Mar 2011

Mar 2010

Share Capital

31.66

13.89

13.89

7.58

5.78

Reserves and Surplus

376.21

295.58

335.91

126.81

44.00

Total Shareholders Funds

407.87

309.47

349.80

134.39

49.78

Secured Loans

215.99

179.76

193.95

123.35

49.59

SOURCES OF FUNDS :

11

Unsecured Loans

278.73

370.45

104.79

15.60

10.10

Total Debt

494.72

550.21

298.74

138.95

59.69

Total Liabilities

902.59

859.68

648.54

273.34

109.47

Gross Block

248.82

248.55

233.72

74.56

48.55

Less: Accum. Depreciation

60.53

40.09

19.87

4.21

1.62

Net Block

188.29

208.46

213.85

70.35

46.93

Capital Work in Progress

179.01

164.09

144.24

46.68

4.20

Investments

212.78

2.40

0.78

0.05

0.05

Inventories

185.53

166.49

137.52

82.37

36.04

Sundry Debtors

365.91

272.37

200.58

90.46

43.30

Cash and Bank Balance

1.22

212.33

4.15

0.67

0.75

Loans and Advances

130.14

18.88

16.84

4.30

3.49

Current Liabilities

355.87

179.79

56.78

1.09

18.78

Provisions

4.43

5.55

12.64

20.45

6.51

Net Current Assets

322.50

484.73

289.67

156.26

58.29

APPLICATION OF FUNDS :

Current Assets,
Advances

Loans

and

Less: Current Liab. and Prov.

12

Miscellaneous Expenses not w/o 0.00

0.00

0.00

0.00

0.00

Total Assets

902.58

859.68

648.54

273.34

109.47

Contingent Liabilities

0.82

0.00

0.00

0.00

0.00

(E)Capital Structure (Anjayena lifrcare ltd)

Period
Instrument
Authorized
Capital
From
To
(Rs. cr)

(Rs. cr)

Shares (nos)

2013

2014

Equity Share

50

31.66

2012

2013

Equity Share

50

2011

2012

Equity Share

2010

2011

2009

2010

Issued Capital
Capital

31655000

Face
Value
10

13.89

13887000

10

13.89

30

13.89

13887151

10

13.89

Equity Share

20

7.58

7576667

10

7.58

Equity Share

20

5.78

5776667

10

5.78

(F. 1) COST OF CAPITAL of Aanjaneya life care Ltd.( in Cr....)

2014
TOTAL
EQUITY

407.87

2013
309.47

2012
349.8

2011
134.39

31.66

13

TOTAL DEDT
REVENUE
FROM
OPERATION
SERVICE OR
EXERCISE TAX
OTHER LEVIES
EBIT (NET)

494.72
421.05

550.21
520.76

298.74

138.95

479.96

220.26

427.46

477.79

479.27

220.26

VALUE
OF
FIRM =E+D

902.59

859.68

648.54

273.34

No data given of Profit and Loss for 2010

COST OF CAPITAL OF THE FIRM FOR THE YEAR 2011= EBIT/VALUE OF

THE FIRM(V)
=220.26/273.34 *100
= 80.58%

COST OF CAPITAL OF THE FIRM FOR THE YEAR 2012= EBIT/V

=479.27/648.54* 100
=73.89%

COST OF CAPITAL OF THE FIRM FOR THE YEAR 2013= EBIT/V

=477.79/589.68 *100
=55.55%

COST OF CAPITAL OF THE FIRM FOR THE YEAR 2014 =EBIT/V

=427/902.59*100
=47.30%

Analysis of Cost of Capital of Aanjaneya Lifecare Limited

Cost of capital is varying and dependent on capital structure.It is widely used in investment
project and evaluating alternative sources of finance.

The total debt and equity means value of the firm increased from the previous year in
902.59 crore .It means firm obtaining equity share capital in two ways firstly it is used

14

for retention of earning and secondly issue of equity share to the public.Issue of
additional equity share to the public involve flotation cost .
For calculating cost of equity share there is no common basis for computation.e.gIn cost of debt interest charge is the base.
Preference dividend is based on the cost of preference share.
In 2014 the cost of capital increased as compare to the previous year by 407.87 crore.
There is no mention the rate of the return. But the minimum rate of return that a firm
must earn on equity finance is a part of investment project in order to leave
unchanged market price of share.
Company revenue expenses also increased.
Cost of capital in 2011 was the highest 80.58% by computation of overall cost.
The cost of the equity share 2014 was highest by 407.87% as compare to all the
previous year.

Cost of Capital
YEAR
2011

COST OF CAPITAL
2013

2012

80.58%1

73.89%2

2014

81.02%3
3

47.30%4
4

PEER COMPANY

(F. 2)COST OF CAPITAL of Cipla ( in Cr....)

2014

2013

2012

2011

15

TOTAL
EQUITY
TOTAL DEDT
REVENUE
FROM
OPERATION
SERVICE OR
EXERCISE
TAX
OTHER
LEVIES
EBIT (NET)
VALUEOF
FIRM=E+D

10091.64
981.39
9174.96

8869.52
1043.29
8134.56

7550.28
72.09
6931.92

6612.95
462.39
6193.82

99.12

92.16

97.23

67.64

9075.84

8042.40

6834.69

6126.18

11073.03

9912.81

7622.37

7075.34

COST OF CAPITAL OF THE FIRM FOR THE YEAR 2011 = EBIT/V = 86.58%
COST OF CAPITAL OF THE FIRM FOR THE YEAR 2012=EBIT/V = 89.66%
COST OF CAPITAL OF THE FIRM FOR THE YEAR 2013 = EBIT/V = 81.13%
COST OF CAPITAL OF THE FIRM FOR THE YEAR 2014= EBIT/V = 81.96%

Analysis of the peer company Cipla

Total debt of the company increase in 2013 but in 2014 its decreasing that is good for the
company.
The company goes into profit initially they issued new shares and the debts would be
decreased for this reason revenue from the operations would be increased.
Earnings before interest and tax would be increased in 2014 by 9075.84 cr. As compared
to the other previous year.
Cost of capital of the company in 2012 was highest as compared to the other year by
89.66%.

(G) Capital Budgeting Decision of Anjayena

ARR-Aveg. profit/Aveg. investment *100

16

In cr.
2011
Investment
455.38
Profit
36.01
From money control

2012
1036.89
41.03

2013
1780.57
0.55

2014
2117.92
0.67

Aveg. Investment=1347.69
Aveg. Profit =19.56
ARR=19.56/1347.69 * 100
=1.45%

Capital budgeting decision mean the firm decision to invest its current fund most efficiently
in the long term assets in anticipation of an expected flow of benefits over a series of year.

It include the process of identifying ,analysis and selecting investment project whose
return are expected to extend beyond one year.
Aanjaneya life care need to be expansion ,acquisition with other company .It also
involve high degree of risk and long time period between initial investment and
anticipated return.
High degree of risk because it totally depend upon the future year cash inflow and
other the uncertain of future and more risk.
(H) Recommendations

Company can change its capital structure or proportions of components that affects its
weighted average cost of capital.For instance- when a firm decides to use more debts
an less equity which lead to reduction of WACC at the same time increasing
proportion of debt in capital structure increase the risk of both debt and equity holder.
Equity capital can be raised by issue of new equity share or through retained earnings.
Sometime company may prefer to raise new equity share by retention of earning but it
involve flotation cost. Retained earning s is less costly than issue of new equity.
Investors expect more return so it affects cost of capital.
Different type of investment policies should be required. It is not compulsory that all
firms have similar type of risk.
Earnings before interest and tax is important it affect overall cost of capital for the
firm but tax rate are beyond the control .
Interest rate is also important in cost of capital. If interest rate increase automatically
cost of debt also increase .On the other hand ,if interest rates are low then the cost of
debt is less.The reduced the cost of debt reduce WACC and this will encourage
additional investment.

17

Market risk is out of control risk and the company have no control on this.

(I )Reference

http://www.moneycontrol.com/financials/drdatsonlabs/profit-lossVI/AL02#AL02
http://www.hdfcsec.com/
http://capitaline.com/SiteFrame.aspx?id=1
http://www.bseindia.com/