Important, however, is the fact that the company has improved its operating margin from 12.89 per cent to 14.18 per cent. Part of the reason for the improved operating margin is the setting up of the new Cardiac Care Division -- 3C for marketing drugs in the cardiology, neurology and diabetology segment. The products in these segments yield higher realisation. Though the company has not yetshown any phenomenal growth as a result of setting up of this division, after a long period, the growth in the domestic market has been higher than the export market. In the domestic market, the company has recorded a growth of 19.79 percent from Rs 145.95 crore to Rs 174.83 crore.

However, the overall performance of the company is nothing to cheer about. Reflecting the company's results, its stock has fallen from Rs 125 to Rs 118. Considering the fact that the company has not, in the last four years, been able to double its turnover, while its profit has improved marginally from Rs 18.54 crore in 1994-95 to the current level of Rs 21.42 crore (mainly due to poor performance of the anti-malarial division), it is no surprise that the company enjoys one of the lowest discounting of 7.8 as compared to other pharmaceutical companies. The company is languishing in a very small trading range, there is no reason in the near future for the stock to move upwards.

Corporation Bank

The final quartersresults from Corporation Bank, though still short of the management's pronouncements, were much better than what most analysts expected. The general expectation of net earnings from Corporation Bank was Rs 185 crore, given the extraordinary one-time provisions that the bank was supposed to make in the last quarter. Initially, in the year, the management had announced that it expected to earn a net profit of Rs 210 crore for the full year, and stuck to that figure even though the market had revised it downward. Against this range of expectations, the bank announced a net profit of Rs 192 crore.

The additional provisions that the bank was expected to make in the last quarter was on account of higher wages (following the IBA/bank unions settlements during the last quarter of 1998-99). The wage settlement provision (since it was with retrospective effect) alone came up to Rs 19.9 crore. In addition, the bank has to provide 0.25 per cent for standard assets as well as on account of NPAs from governmentguaranteed loans. The cumulative impact was expected to be Rs 20 crore.

In the recent past, the bank has consistently earned an RoA of 1.9 per cent. The current lower return on assets at 1.6 per cent actually would be closer to its past returns if the extraordinary provisions are ignored. This 98-99, RoA is still the best when compared with the PSU and other Indian banks (excluding the new generation banks).

In addition, the bank continued with its relentless drive to reducing net NPA through a combination of recovery drives as well as by provisionings. The reduction in net NPAs to below 2 per cent seem to vindicate the managements stand of reducing provisioning to some extent.

The stock market which is in the midst of a major re-rating of the leading financial sector stocks have taken well to the last quarter results from Corporation Bank.