The new subsidiary will be eligible to take the benefit of a 10-year tax holiday recently announced by the government for 100 per cent R&D subsidiaries. The company also plans to transfer its existing R&D centre in Panchkula, Chandigarh into the new company.

To part finance the new R&D centre, the company is raising close to Rs 15 crore through private placement of shares at around Rs 110 per share to financial institutions (FIs) and mutual funds.

"We will develop the new R&D subsidiary as a profit centre and would charge other divisions for the research undertaken. We are also talking to a couple of multinationals for undertaking contract research in the new subsidiary," Ind Swift Limited's director, VK Mehta told The Financial Express.

Ind-Swift recently launched its super speciality division for introducing drugs based on a Novel Drug Delivery System (NDDS). The company has already procured an export order worth $ 1.5 million that will be executed over the next few months. The full year turnover from the super speciality division is expected to be around Rs 15 crore.

Out of the proposed preferential allotment of around 15 lakh shares, the company has already allotted 5.45 lakh shares to FIs and mutual funds including Unit Trust of India (UTI), State Bank of India (SBI) and Prudential MF. The promoters will also subscribe to fresh equity through private placement in order to maintain their equity stake of around 50 per cent.

The company is the second company in India after Ranbaxy to have launched `Clarie DT' (clarithromycin dispersible tablets) in India. Ind-Swift's R&D centre at Panchkula has been certified by the department of science and technology, government of India and has launched products like `SR' (isosuxprine sustained release), `Neurobex Z' (granulated B complex) and `Clarie DT' in NDDS.

Ind-Swift has been focusing on two segments - the steroids and hormones segment, whose contribution to turnover rose from 20 per cent to 25 per cent, and the anti-infectives segment, whose contribution has increased from 15 per cent to 20 per cent. "We also plan to focus on anti-ulcerants with products based on NDDS," said Mehta. The company is the first in the world to provide `dispersible clarithromycin tablets' (Clarie-DT), which is the 11th most prescribed drug in the world. The product alone is expected to generate a turnover of around Rs 10 crore for the company.

For the year ended March 2000, the company reported a turnover of Rs 76.16 crore and a net profit of Rs 5.77 crore against Rs 62.06 crore and 3.25 crore respectively reported last year. Ind-Swift's top five products, namely Anin, Stemin, Cozy, Supox and Phena have registered a sales growth of over 100 per cent last year and contributed close to 27 per cent to the total turnover. Ind-Swift recently set up a new plant at Parwanoo to manufacture tablets, injectibles and ointments. The plant is expected to yield an additional turnover of Rs 30 crore this year, thereby taking the total turnover to around Rs 120 crore, Mehta said.