PRESS RELEASE

Nicholas Piramal registers 76.1% growth in PAT
19.3% growth in Sales in Q3 FY04

Mumbai 28 January 2004 - Nicholas Piramal India Limited (NPIL) registered a 19.3% growth in Net Sales and 76.1% growth in Net Profit for the Third Quarter of FY 2003-04 (Q3 FY04). Net Sales stood at Rs. 2,620.2 million (Q3 FY03: Rs. 2,195.5 million). Operating Profit Before Interest, Depreciation and Tax grew 26.9% to Rs. 548.1 million in Q3 FY04 from Rs. 432.4 million for the corresponding quarter in FY 03. Net Profit grew to Rs. 373.2 million compared to Rs. 211.9 million in Q3 FY03.

NPIL’s Domestic Formulations business outperformed the market for the seventh consecutive quarter, growing 13.4% against an industry growth rate of 5.1% (ORG-MARG MAT Dec-03). Top-10 Brands formed 36% of the portfolio.

In Q3 FY04, NPIL delivered impressive growth in therapeutic areas such as Respiratory (19.1%), CVS (23.9%), CNS (13.4%), Anti-Diabetic (34.2%), Dermatology (33.7%) and NSAIDS (17.9%) over the corresponding quarter for the previous year.

During Q3 FY04, NPIL also acquired 100% ownership of Sarabhai Piramal Pharmaceuticals Private Limited (SPPL). This has given NPIL strategic advantages in its brands portfolio, therapeutic area ranking, doctors’ coverage and field force expansion. SPPL has 12 Brands with Sales over Rs. 50 million, forming over 60% of its Sales. SPPL’s leading brands include Pentids, Esgipyrin, Tossex, Mazetol, Resteclin and Suganril. The buyout increases NPIL’s domestic formulations market share to 4.4%, up from the current 3.4%, bringing it to 4th rank. NPIL will also improve its ranks in therapeutic segments such as Pain Management (No.1 from No.7), CNS (No.2 from No.4), Respiratory (No. 3 from No.4) and Hormonal (No. 5 from No. 8) (source: ORG-MARG data). On the market coverage front, NPIL’s field force will now increase to 2,805 up from 2,010 at present - making NPIL the distinct leader in India market reach.

The Board of NPIL today approved merger of SPPL with NPIL w.e.f. 01 April 2003. The full operational and integration benefits arising from the merger are expected to flow in FY05.

NPIL’s R&D expenditure increased to Rs. 195.9 million for the Nine Months of FY04 from Rs. 113.1 million in the corresponding period of FY03.

Through FY04, NPIL has implemented a differentiated Exports strategy, which is built on partnership with Global Innovator Companies for long-term Custom Manufacturing contracts. In line with its Exports focus, NPIL’s Exports grew to Rs. 281.1 million in Q3 FY04, resulting in total Exports Sales for the Nine Months of FY04 reaching Rs. 763.5 million (9.1% of total Sales). The quarter also witnessed NPIL achieve its first custom manufacturing contract – a 5-year agreement with AMO, USA for the global supply of eyecare products.

Announcing the results, Mr. Ajay Piramal, Chairman, NPIL, stated: “NPIL’s differentiated business strategy has now taken deep roots. Our performance is an outcome of that.” “Our efforts will now be towards making the next big leap-forward to achieve excellence & leadership in the Global marketplace,” he added.