General Information Of Sarabhai Chemicals Ltd., Vadodara
A Division of Ambalal Sarabhai Enterprises Ltd.


By
Ms. Jyoti Patel
B. Pharm [MS University Of Baroda]
MBA 2nd Semester
Shree Amreli Jilla Leuva Patel Charitable Trust MBA Mahila College
Amreli–365 601 GJ
E-mail:
vijaypithadia@lycos.com
 


THE HOUSE OF THE SARABAHI

The companies managed by the house of the sarabhai. Today employee more than 14,000 persons and have an annual sales of Rs, 20, 00,000/-. The story begins about 150 year ago with karamchand premchand, who was engaged in business as a private banker. The business expanded considerabily and branches of it open in several cities in India. Sarabhai is only one year old when his father maganbhai died. His trustees managed the textile printing business till the attained majority. It was believed that textile printing would only pay only if weaving was introduced, subsequently spinning was added to weaving. Soon after this step had been taken, printing was dropped and restarted only in 1935. Sarabahi Maganbhai died when his son Ambalal, present head of the family was six year old. During his minority the business was managed by his uncle who brought about the first major expansion of the mill between 1898 and 1906.

In 1909, Ambalal Sarabhai took the charge of the mills and further expanded operations. A major expansion was also under taken by the starting of a no. of diversified enterprises, particularly a sugar factory and alcohol distillery in bihar and taking over the swastika oil mills, Bombay. A later produces a variety of shops, hair oils, glycerin, industrial oil and edible oil also established in Ahmedabad.

At present Gautam sarabhai and vikram sarabhai share the whole business of his father ambalal sarabhai. Whole responsibility of the sarabhai chemicals was taken by the both brother.

Sarabhai chemicals were started at Baroda in 1943 for the manufacturing of fine chemicals and pharmaceuticals products. At result calcium lactate was made from the fermentation of molasses. And other chemicals were added to the range of drugs supplied to the pharmaceutical industry of India. It was felt the progress in fine chemicals would be slow due to small demand in the country and there for the cost of research and development could not be born commercial for many years to come for this reason.

As a result of these arrangement Sarabhai chemicals manufacturing to a constant increasing extent squib products in India They started with subdiving antibiotics and extended their manufacturing to hematinics. Vitamins, muscle relaxations, cardiovascular and antituberculosis drugs unequaled facility were added in the manufacturing in quality control section by the introduction of the most modern equipments and instruments. A building of latest design has been constructed carrying out the antibiotic filling and other pharmaceutical operations.

The research and development section has developed a no. of processes for the manufacturing of isoniazid, saccharine, procaine, hydrochloride, nicotinamide, nicotinic acid, nikethamide, diido-hydroxy-quinoline etc. full scale manufacturing has been started in most of these cases. Presently overall strength of Sarabhai chemicals as per the month of June 2005 is1767

      Permanent workers    - 1406,  
         Unionized staff          188,
         Consolidation staff -   154,
         ER celling staff      -   19.
         Totally                     1767

VARIOUS UNITS OF SARABHAI CHEMICALS

    1. Sarabhai Chemicals
    2. Sarabhai common Services
    3. Sarabhai Research Center
    4. S.G. Pharma
    5. Synbiotics
    6. Ambalal sarabhai Enterprise corporate office
    7. Information Services

Tasks Prepared By 7 Units of A.S.E

    1) Sarabhai Chemicals
    Sarabhai Chemicals is the main units produsing all the various kinds of chemicals, medicines & drugs, which are put in the market by the Enterprise, this Unit can be called the heart of the Enterprise.

    2) Sarabhai common Services
    Sarabhai common Services are the Unit, which provides all the Essential Services Required to run the Units of A.S.E. It is the power house of all the Units.It provides vapour, steam, electricity, etc.to all seven Unites of the Enterprise.

    3) Sarabhai Research Center.
    This Unit researches for new products, to gain advantage in the market. This Unit results in all the innovation products.it can be said as the
    brain of the Enterprise.

    4) S.G. Pharmacy
    This Plant was previously located at Ranoli, but now the whole of the Unit including Workers, machines& products are transferred to the Sarabhai Chemicals Units. This Units Specializes in the cardiovascular products.

    5) Synbiotics
    This Unit produces mostly Chemicals like Amphotarecin, Streptomycin powder, tetracycline in bulk as Sarabhai Chemicals need it.

    6) Ambalal sarabhai Enterprise corporate office.
    This Unit is a sort of Service Center for administrative purpose which looks after shares finance, bones & all such issues of the Company.

    7) Information Services
    This Unit provides computerized data Services to all the Units for the purpose of Salary for the Staff, Wages for Workers etc

VISION & MISSION

Vision when company establised

    1. One of the top  pharmaceutical company in India
    2. To earn maximum profit
    3. Provide the life saving drugs to society

Present vision

Presently company face financial crises due to this company reduce the existing strength of employee, presently company is under loss. By reducing employee strength company is trying to match its expenses with income. Company may develop its own product & marketing division. Renovation in existing facility in manufacturing, packing & storage areas as per requirement of SCHEDULE –M DRUGS & COSMETICS ACT

Mission

    1. To provide quality products and services to pharmaceutical sector and industry at competitive prices and contribute to improving life saving drugs to society.
    2. To achieve excellence through creativity, innovation, developing and services to the society.

Present mission

Presently company face financial crises due to this company take approval from government for VRS (VOLENTARY RETIREMENT SCHEME) voluntary retirement, early retirement (reduction in retirement age) also retirement in possible areas. Company adopts new technology: the company has erected its own power plant for the generation of electricity. This plant is neither thermal based nor hydro based. This plant is completely based on gas e.g. vapour. Main reason for establishment of this plant is to reduce the electricity bill.

Size of the Unit & Form of Organization

[1] Ambalal Sarabhai Enterprises Is a Pubic Limited Company.
[2] Sarabhai Chemicals is one of the units of A.S.E.-Ambalal Sarabhai Enterprise.

PRESENT MANPOWER STATUS

The overall Strength of Sarabhai chemicals as per the months of June 2005 is 1767 Employees. It is further Categorized as follow.

 On 1st June 2005:

                Permanent Workers      1406
                Unionized Staff            188
                Consolidated Staff       154
                E.R Ceiling Staff           19
                       Total                1767

SWOT ANALYSIS


Who GMP Approved:

Sarabhai Chemicals, a Vadodara based unit of A.S.E. has separate plants for sterile, Non-sterile & anti cancer products. All the plants of the Sarabhai Chemicals are who GMP (world health organization good manufacturing practices) Approved. This approval as a result becomes a big strength of Sarabhai Chemicals, which is apparent before the outside world also including the creditors of the company.

Good Developed Infrastructure:

The company has fast developed company infrastructure consisting of separate production plant for sterile, non-sterile & anti-cancer product at Vadodara. The non-sterile manufacturing plant is who GMP approved & these sterile manufacturing plant. It has facility to produce Various formulation like Dry filed injectable, liquid Parenteral penicillin & non-penicillin Tablets, Capsule dry powder, liquid orals & ointments, & has special facility to manufacturing Insulin, Fungizone & anti cancer product, etc.

LATEST TECHNOLOGY:

In terms of technology & technical know-how also Sarabhai Chemicals does not lack anywhere with the virtue of Dr. Vikram Sarabhai the company has been working in collaboration with Messer's E.R. Squibb of New York, which spends a significant amount on medical research alone. By this know-how agreement Sarabhai Chemicals did not only gained the technical manufacturing know-how but the fruits of Squibb's vast research programme, as well as the opportunity of training Sarabhai personnel in Squibb Laboratories were also availed. A Separate unit – Sarabhai Common Services – Looks after the different services, which are provided to different Sarabhai group of companies, located at Vadodara.

DIVERSE BUSINESS:

Presently Sarabhai Chemicals started, its own marketing division for its generic product, before that the marketing of Sarabhai Chemical done by Nicolas piramal.  Besides having 20 units of A.S.E. all over India, A.S.E. works in merges and collaborations with many other big companies. Under the name of Sarabhai glass a mordern glass Vial manufacturing plant with completely automatic equipment from the U.S.A. is being installed to meet the large demand for glass vials in the antibiotic filling section of the pharmaceutical operations. In 1955 the Sarabhai entered into an agreement with guigy of basic whereby manufacturing of certain of their chemicals and pharmaceuticals is done in a separate concern.

"SUHRID GUIGY PRIVATE LIMITED" at Vadodara

Sarabhai Chemicals entered into an agreement wire Messer's E.R. squibb & sons of New York for know-how collaboration in their range of product, in the years 1950, at a time when squibb were spending already more than Rs. 1,50,00,000/- annually on medical research alone. Recently the Sarabhai Chemical started its own marketing division. Before 2 years Sarabhai Chemical, the controlling interest of the well known pharmaceutical company of Calcutta, Standard pharmaceutical works Ltd. has been taken over by Sarabhai's. This company has a successfully career of over 25 years and manufacture Vaccines, Sera and specialties, which are popular among the medical profession. They are currently putting up a plant for the manufacturing manufacturing of penicillin. Sarabhai has also entered the field of basic manufacturing of antibiotics in a large way. They have a manufacturing license for manufacturing of tetracycline & streptomycin.

WEAKNESS

Lack of Dynamism:

As the company has not made any recruitment for the last 15 years in the administrative department these has not been any fresh & dynamic addition in the Human resource of the company. This is the major drawback for company development. No doubt, the experience of the personnel instead is required but beyond certain age group it results in "Lack of Dynamism" & "No New ideas"& No new Blood. Due to this age barriers they are not receptive towards new challenges in their present job.

Under Utilization of the Man Resource:

As the company is facing lack of adequate demand for its products the company is unable to utilize its human resource optimally. As a result even it can be said that the human resource of the company is not fully utilized.

As far as production department is concerned, the human resource as well as the plant capacity is fully utilized. This can be well interpreted from the below data.

Years

Production capacity utilized

Strength of employees

1982

330.83%

5000

2002

150%

2667

2003

145.56%

2200

2005

118.76%

1795



From the above table it can early be interpreted that through the company has eliminated almost half of its strength the company can work at 1795, present of the capacity. That means the company has now eliminated the disguised unemployment substantially.

OPPRTUNITIES

Success in the Research of Anti-Cancer Drugs:

In this 2 – 3 years company not get success in new research drug. But before 3 years, The Company's research dept. is get success in developing an anticancer drug. The successfully completion of this project can become a golden opportunity for the company, as the Sarabhai's would be the first in the whole Asia to develop such an anti-cancer drugs manufacturing see toward the research dept. & find out the reason for no success in last 3 yrs. & Try to solve out the problem. Then it's good opportunity for organization. Because, ultimately the research department is the heart of the organization.

THREATS

Compactions:

Compactions are the supposed rivals for any company. Sarabhai's main Competitors are Ranbaxy, Alembic, Glaxo, Cadila, Cipla, etc. underestimating the competitors can become a threat to the company. The company that leaded the market had to struggle hard for the second position later. In 1988, the market was taken over by Ranbaxy with a 10.8% share in the largest segment of Indian pharmaceutical Industry i.e. antibacterial market making the leads Sarabhai Chemicals 2nd ranker with market share of 10.4%. Now also, the Ranbaxy's have been the only one who have developed a drug under the new delivery system the once who have developed a drug under the new delivery system the once a day innovative formulation of ciprofloxacin, Registered under the Indian patents Act. (Which is exempted from the price – control according to the new provision of DPCO drug price control order).This can be perceived to be an indirect threat to the Sarabhai's as the Ranbaxy such successes can snatch the market of Sarabhai's too.

Dissatisfaction among the Employee:

Due to the financial crisis that the company is facing at present it is not able to pay the salary to the employees at time. Recent situation is company not gives salary to employee from last 7 month. This situation is not favorable as it can in long term lead to dissatisfaction & frustration among the employees it is directly affect the productivity & hence can affect the efficient functioning of the company. Also, it decreases the efficiency of employee.

Cost of Production:

Considering the present situation it seems that the company's main focus should be to decreasing the cost production most of the products of Sarabhai fall under the category of life saving drugs, where the profit margin decided by the DPCO are last (Drug price control order). In such a situation if the company does not decreasing the cost of production & some other competitor becomes successfully in doing so then it would be very hard task for the competition its products at a higher price in the market.

Conclusion

As this report has been prepared after an interactive experience with the company for 18 May to 25, June 2005 This period is not sufficient to analyze such a genuine overview of the company. And in short period employees and the supportive authorities of the company enabled us to make-out logical inferences by providing the genuine and the valuable information. After having an informal interaction with the company we came to the conclusion that sarabhai chemical is well established company having a well developed infra structure, including efficient production dept., HRM, marketing & planning, purchase, and account dept. with talented auditing, effective marketing & management team.

The company has a full capacity to complete the present tough marketing competition by making mines improvement like more atomization, maintaining discipline at all levels & utilizing maximum capacity of manpower & plant production capacity. Also company with good people and a name But presently the company facing the financial crises, means company is in loss, so the presently company trying to reduce the recent manpower in possible area by VRS. For that company only aim is to match expenses with income.

Company will reach star of success makes it present and future glorious as its past was.
 


Ms. Jyoti Patel
B. Pharm [MS University Of Baroda]
MBA 2nd Semester
Shree Amreli Jilla Leuva Patel Charitable Trust MBA Mahila College
Amreli–365 601 GJ
E-mail:
vijaypithadia@lycos.com
 

Source : E-mail September 5, 2005

 

  

 

Occasional Papers Main Page

Important Note :
Site Best Viewed in Internet
Explorer in 1024x768 pixels
Browser text size: Medium