J B Chemicals and Pharmaceuticals, a Rs 700 crore Mumbai-based pharmaceutical company, has identified high potential for its herbal and ethical formulations in Central European countries. In order to tap this potential, the company, has set up a wholly- owned subsidiary in Romania. This initiative is also expected to contribute to value creation over the medium term. Further, it has identified South Africa, Australia, Brazil, Venezuela and other Latin American countries as future growth drivers. It is also evaluating inorganic options for faster growth in these markets.

While addressing shareholders at the Thirty-Third annual general meeting, J B Mody, chairman, said, "The international economic crisis that has affected the demand and currencies movements the world over is yet to abate and is widely expected to remain till Q2 this year. This has posed unprecedented challenges for our business. Your company has taken steps to tide over these challenges and expects to withstand them through focus on achievement of efficiencies in manufacturing, marketing and working capital management on one hand, and aggressive marketing campaigns in key markets on the other, to maintain performance during the current year."

Mody added, "As you all know that the significant part of your company's sales come from exports, with major share there of it coming from Russia, Ukraine and CIS countries. As such, the financial results of the company are inevitably impacted by the volatility in the foreign exchange market. However, your company has put in place appropriate risk mitigation measures based on professional advice."

J B Chemicals has achieved impressive financial performance during the year ended March 2009 and its consolidated net sales increased by 31.4 per cent to Rs 738 crore. Its total exports jumped to Rs 499.98 crore, an increase of almost 52 per cent over the previous year. Despite the depreciation of the local currency in key markets of Russia, Ukraine and CIS, it was still able to muster good growth in these key markets.

During the year 2008-09, the company introduced 13 new products across the markets, while 'Zecuf', a herbal product, was seen building into a strong OTC brand. The gross sales of formulations in domestic market at Rs 220 crore registered marginal increase over the previous year and now it has put renewed focus on this business for achieving market related growth. Four new high growth products were introduced during the year to strengthen the product basket. The silver lining in this segment was that the diagnostic division, that offers niche contrast media products, registered good growth of 17 per cent.