PRE FEASIBILITY REPORT

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1 ESHWAR PHARMACEUTICALS (P) LTD. (Formerly known as Konar Organics Ltd.,) SY. NO. 180/2, IDA KHAZIPALLY, KHAZIPALLY VILLAGE, JINNARAM MANDAL, MEDAK DISTRICT, ANDHRA PRADESH PRE FEASIBILITY REPORT Eshwar Pharmaceuticals (P) Ltd. H.No , Flat No. 504, Sri Sai Residency, Balkampet, SR. Nagar, Hyderabad Phone: , E mail ID: chandrashaker@smspharma.com SUBMITTED TO MINISTRY OF ENVIRONMENT AND FORESTS, GOVERNMENT OF INDIA PARYAVARAN BHAVAN, LODHI ROAD, NEW DELHI

2 Pre Feasibility Report M/s. Eshwar Pharmaceuticals (P) Ltd.,, Survey No. 180/2, IDA Khazipally, Khazipally Village, Jinnaram Mandal, Medak District, AndhraPradesh Executive Summary M/s. Eshwar Pharmaceuticals (P) Ltd.,, proposed to expand its existing Bulk Drugs and intermediate manufacturing facility from 5 TPM to 20.1 TPM located at Sy.No. 180/2, IDA Khazipally, Khazipally (Village), Jinnaram (Mandal), Medak (District), in Andhra Pradesh. The company has about 7.98 acres of land at Survey No. 180/2 of IDA Khazipally. The site is having a longitude (E) and latitude (N). The plant is surrounded by Jillelavagu and Hetero Drugs Ltd., in north, Jyothi Buildings in south, SMS Pharmaceuticals Ltd., Unit I in east and IDA road and Khazipally sump in west directions. The nearest human settlement from the site is Shambupur village located at distance of 1.4 km from the site. There are no ecologically sensitive areas like national parks, sanctuaries within 10 km radius of the site. 2. Introduction of the Project / Background Information: 2.1 Identification of Project and Project Proponent: The objective of this pre-feasibility study is to provide information for the expansion of Synthetic Organic Chemicals from 5 TPM to 20.1 TPM located at Sy.No. 180/2, IDA Khazipally, Khazipally (Village), Jinnaram (Mandal), Medak (District), in Andhra Pradesh, in existing area of 7.98 acres. 2.2 Brief Description of Nature of the Project: The synthetic organic chemicals manufacturing will involve series of chemical reactions to get the final Product. The products of reaction are purified, filtered and dried before packing the final product. The Chemical reactions require various supporting services like Heating, Cooling and Agitation etc. 1 P age

3 2.3 Need for the project and its importance to the country and or region: World population is growing at an alarming rate. In the Indian sub continent population growth is more than that of developed countries. To meet the needs and comforts of ever-growing population industrialization became inevitable. For the growing population the needs of health care substitutes are also increasing. 2.4 Demands-Supply Gap: The project is envisaged to meet the demand supply gap in both domestic market and export market, as API demand is increasing day by day. 2.5 Imports Vs. Indigenous Production: The project shall enhance the foreign exchange reserves in view of the proposed products. 2.6 Domestic/export Markets: The products shall cater to both domestic and export markets. 2.7 Employment Generation (Direct and Indirect) due to the project: The present project for manufacturing of Synthetic Organic Chemicals requires substantial handling of raw materials, goods in process and finished goods. The proposed expansion shall increase the employment potential. 3. Project Description 3.1 Type of Project including interlinked and interdependent projects, if any: M/s. Eshwar Pharmaceuticals (P) Ltd.,, proposed to expand its existing Bulk Drugs and intermediate manufacturing facility from 5 TPM to 20.1 TPM located at Sy.No. 180/2, IDA Khazipally, Khazipally (Village), Jinnaram (Mandal), Medak (District), in Andhra Pradesh. The company has about 7.98 acres of land at Survey No. 180/2 of IDA Khazipally.. 2 P age

4 3.2 Size or magnitude of operation: List of products and manufacturing capacity Manufacturing Capacity S.No Name of the Product Capacity TPA TPM 1 CIS-2-(2,4 Dichloro Phenyl)-2-(1H,1,2,4 Triazol-1-YL Methyl)1-3-Dioxolane-4-yl Methyl Alcohol 2 2,4-Di Hydo-4-{4-[4-(4-Methoxy Phenyl)-1- Piperazinyl]Phenyl}-3H 1,2,4 Triazole-3 One N-(4-((Amino Iminomethyl Thio-Methyl)-2-Thiazolyl Guanidine Dihydrochloride 4 N-Sulfamyl-3-Chloro Propianamide HCl ,4-Diethoxy-N, N-Dimethyl-1-Butanamine Methyl-4-Nitro-3N-Propylpyrazole-5-Corboxamide ,3 Dichloro Acetone CIS-2-Bromo Methyl-2-(2.4-Dichloro Phenyl-[1,3] Dioxolan yl Methyl Methane Sulfonate Crude 9 Imidazole-1yl-Acetonitrile (2-Chloro Phenyl)-2 Methane Sulfonyloxy Ethyl Ester Methane Sulfonic Acid 11 2-Chloromethyl-3, 4-Dimethoxy Pyridine Hydrochloride S(+)-2-Aminobutyramide Hydrochloride Total Process Description with process details (a schematic diagram/flow chart) Typical process description with process details is presented in Annexure I of FORM I Application. 3.4 Raw material required along with estimated quantity likely source, marketing area of final product/s, mode of transport of raw material and finished product. All the raw materials required for manufacturing mostly available in India or from abroad. There are no banned chemicals or products which are proposed to be used. It is proposed to enter into long term arrangements with some of the raw material suppliers both in India and overseas to avoid shortages at any time. 3 P age

5 3.5 Availability of water its source, energy/power requirement and source should be given Water is required for process, scrubbers, washing, cooling tower makeup, steam generation and domestic purposes. The total required water after expansion shall be drawn from APIIC (Industrial supply) in addition to reuse of treated wastewater. The total water requirement after expansion increased from 41 KLD to KLD out of which 84.8 KLD fresh water and 46 KLD of recycled water. The total water balance is presented table below. Total Water requirement After Expansion (Tentative) Purpose INPUT (KLD) OUTPUT (KLD) Fresh Water Recycled Water Loss Effluent Process * Washings 3 3 Scrubber 2 2 Boiler Feed Cooling Tower RO/DM Plant 4 4 Domestic Gardening 2 2 Gross Total Total * Process effluents contain soluble raw materials, byproducts, solvents etc Electricity: The requirement of power will be 2MW. Further, due to the nature of the reactions and requirement of continuous power, the management proposes to put in place 100% self generation of power by DG sets of 4x 125 KVA capacity. Therefore no delay or difficulty is foreseen on the power front. 4 P age

6 3.6 Quantity of wastes to be generated (liquid and solid) and Scheme for their Management/disposal Quantity of Effluent Generated and Mode of Treatment After Expansion (Tentative) Description Quantity (KLD) Mode of Treatment Permitted After Expansion HTDS Effluents Process Sent to Stripper. Stripper condensate sent Washings 3 to cement industries for coprocessing/tsdf. Stripper bottom sent to MEE. Scrubber Effluent 2 Sent to MEE followed by AFTD and DM rejects 4 biological treatment plant. Total - HTDS LTDS Effluents Boiler Blow downs Sent to Biological Treatment System Cooling Tower Blow downs 8 followed by RO. RO permeate reused for cooling tower makeup. RO rejects sent to MEE. Total - LTDS Domestic Sent to Septic tank followed by soak pit. Grand Total Solid Wastes and Disposal After Expansion (Tentative) Description Units After Mode of Disposal Expansion Ash from Boiler TPD 10.1 Sold to Brick manufactures Process Organic residue TPD 2 Sent to TSDF/Cement Industries Solvent Residue TPD 0.5 Sent to TSDF/Cement Industries Spent Carbon Kg/day 60 Sent to TSDF/Cement Industries Spent Solvents KL/Month 1000 Recovered within the plant premises. Mixed Solvents KL/Month 250 Sent to authorized recovery units/ Cement plants for co-incineration Evaporation Salts TPD 1.8 Sent to TSDF Stripper Distillate KLD 2.2 Sent to Cement Industries for Coincineration. ETP Sludge TPD 1.24 Sent to TSDF Detoxified containers No.s/Month 200 After detoxification sent to Authorized agencies Waste oil Lts/Month 300 Sent to Authorized Recyclers Used batteries No.s/year 15 Sent to Authorized Recyclers 5 P age

7 4. Site Analysis 4.1 Plant Location M/s. Eshwar Pharmaceuticals (P) Ltd.,, proposed to expand its existing Bulk Drugs and intermediate manufacturing facility from 5 TPM to 20.1 TPM located at Sy.No. 180/2, IDA Khazipally, Khazipally (Village), Jinnaram (Mandal), Medak (District), in Andhra Pradesh. The company has about 7.98 acres of land at Survey No. 180/2 of IDA Khazipally. The site is having a longitude (E) and latitude (N). The plant is surrounded by Jillelavagu and Hetero Drugs Ltd., in north, Jyothi Buildings in south, SMS Pharmaceuticals Ltd., Unit I in east and IDA road and Khazipally sump in west directions. The nearest human settlement from the site is Shambupur village located at distance of 1.4 km from the site. There are no ecologically sensitive areas like national parks, sanctuaries within 10 km radius of the site. 5. Planning Brief: The project is envisages to be completed by December 2015, and the production shall be initiated thereon. Consultants are identified for preparing the detailed project report. 6. Proposed Infrastructure: 6.1 Power Requirement and Supply/Source The total power requirement is 2MW. 6.2 Utilities List of Utilities S.No Utility Permitted Proposed 1 Coal Fired Boiler 0.5TPH# 2 x 3 TPH 3 DG Sets* 2x 125 KVA 2x 125 KVA # shall be removed * DG set will be used during load shut down. Equipments The basic technology involved in the manufacturing of Bulk drugs is the process Kettles, Heat Exchangers, Centrifuges, and Storage Tanks. To support the process equipment Boilers, Chilling plants, Cooling Towers Etc. are required. All the above equipment can be sourced indigenously and the lead time to supply the equipment will not exceed 20 weeks. 6 P age

8 6.3 Waste management Liquid Effluents The main sources of effluent generation from the plant are process, washings, Scrubber, blow downs from utilities like cooling tower, boiler & domestic effluents. The process effluents are segregated on the basis on TDS and COD loads and treated in Effluent treatment system. Air Pollution The sources of air pollution in the plant are from the existing 8 TPH Coal fired boiler, standby 3TPH coal boiler and proposed 8 TPH coal fired boiler to meet the steam requirement both for process and ZLD and existing backup DG sets of 62.5, 2 x 320 and proposed 2 x 750 KVA, to cater to energy requirement during load shut downs. The proposed air pollution control equipment for coal fired boiler is bag filter. DG sets shall be provided with stack heights based on the CPCB formula for effective stack height. Solid waste Solid wastes are generated from the process, solvent distillation, distillate from stripper, salts from ATFD, sledges from ETP (primary & secondary), waste oil from DG sets, used batteries from DG sets. The stripper distillate, process residue and solvent residue are sent to TSDF/cement plants for co-incineration. The evaporation salts are sent to TSDF. Filter media like spent carbon, catalyst and hyflow are sent to TSDF/authorized recyclers. Waste oil and used batteries from the DG sets are sent to authorized recyclers. The sludge from effluent treatment plant is considered hazardous and the same is sent to TSDF. The ash from boiler is sold to brick manufacturers. The other solid wastes expected from the unit are containers, empty drums which are returned to the product seller or sold to authorize buyers after detoxification. 7. Rehabilitation and Resettlement (R&R) Plan Not applicable as the land area is only 7.98 acres already acquired. 8. Project Schedule & Cost Estimates 8.1 Likely date of start of construction and likely date of completion (Time schedule for the project to be given) December P age

9 8.2 Estimated project cost along with analysis in terms of economic viability of the project The estimated cost of the project is approximately Rs. 2 Crores. Project Cost Rs. In Crores Plant& machinery 1.32 Civil buildings 0.03 Structures 0.03 Total 1.38 Pipe lines & insulation 20% on plant & machinery 0.27 Electricals & instrumentation 10% on plant & machinery 0.14 Erection & commissioning & painting 8% on plant & machinery 0.11 and structures Land & development 0.01 Furniture, fixtures, computers, lighting 0.01 etc Total 0.54 Contingencies & pre-operative expenses 5% on the above 0.08 Project Cost 2 8 P age