DABUR NEPAL PRIVATE LIMITED

Annual Report for the financial year ended 31st March, 2009
Contents
Director’s Report 1

Auditor’s Report 4

Balance Sheet 6

Profit & Loss Account 7

Statement of Cash Flow 8

Schedules 9

Accounting Policies & Notes to Accounts 14

 DIRECTOr’s RepoRT
To,
The Members,

This report presented by your Directors in respect of Financial year ended on 31st March 2009 has been made out for the limited
purpose in terms of section 212(2)(b) of Indian Companies Act,1956. Pursuant to section 212(2)(a) and section 212(2)(b) of Indian
Companies Act, the Balance Sheet of Dabur Nepal Private Limited as on 31st March 2009 and the Profit & loss Account for the year
ended on that date dealt with by this report have also been made out in accordance with the requirement of Indian Companies Act
1956,which have been certified by an Indian firm of Chartered Accountants thereby making out the audit report thereof in accordance
with the requirements of Indian Companies Act,1956.

FINANCIAL RESULTS
The Financial results of drawn in accordance with Indian Companies Act are as follows:
(Rs in lacs)
Particulars 2008-09 2007-08
Sales (inclusive Other Income) 27,333.35 24,639.97
Profit before Tax 17.52 566.74
Less: Provision for Tax-current 2.74 125.93
Net profit after tax 14.78 440.81
Balance brought forward 5,467.50 5,039.09
Additional Provision Related to Earlier Years
Income Tax Adjustment for Previous Years 12.40 12.40
Other Adjustment for Previous Years - 2.24
Profit available for appropriation 5469.88 5467.50
Appropriation/allocation:Interim DividendTransferred -- --
to general reserve
Balance carried over to balance sheet 5469.88 5467.50

OPERATIONS AND ACTIVITY
During the year, the Domestic Sales of your Company has been increased by 11.1%. This growth in sales is achieved despite of the 1
month long factory closure during the month of August – September 2008.

In retrospect to FY 2008-09, the recession has crippled the world economy. As a result of this, the commodity prices touched sky
high with the price of crude oil crossing USD 140 per barrel. Similarly, the cost of other inputs has also increased. Further, during
the year, there was huge appreciation in the value of USD, resulting in huge exchange loss to the Company. As a result of these
factors, the Profit after Tax of your Company has decreased significantly.

FUTURE OUTLOOK
The Global economy is passing through the severe recession. The market demand worldwide has reduced sharply affecting the world
economy negatively, and Nepal is also not an exception to this. Despite of these negative factors, your Company has a very proactive
business plans, and taken sufficient measures to ensure the healthy sales and profit growth along with sound financial health.

EXPANSION/MODERNIZATION
During the year, your Company has carried out the residue activities of the completion of projects initiated in FY 2007-08, and
accordingly has completed the TBA 22 project. Further, project for expansion of Storage space and upgradation of Laboratory
Equipments has been carried out.

MEDICINAL PLANTS PROJECT

Your Company has achieved self sufficiency in endangered spices like Akarkara, Chiraita and Shatavari during this financial year, and
has started to explore the export market for these products for selling surplus materials. In this regard, your Company has displayed
all of its cultivated produce in the World Herbal Fair held in Dubai in the month of November 2008.
As a measure of Public Private Partnership (PPP), Memorandum of Understanding with Institute of Forestry, Hetauda (Ministry of
Forests) has been entered into for establishing Trial and Demonstration of medicinal and aromatic plants at the Institute premises
and Chitwan Forest User Groups. This initiation will help to reduce the cost of growing these plants since we need not have to pay
rent for utilization of Land, and will also help to generate extra revenue since this module of operation has been entered into in the
profit sharing basis.
1
DIRECTORS
During the year, Mr. C. Mohan, Director had resigned from the directorship of the Company w.e.f. 12th May 2008. The Board places on
record its gratitude for the valuable services rendered and guidance provided by Mr. C. Mohan during his tenure with the Company.
Further, during the year, Mr. Amit Burman, Director of the Company has been appointed as Whole Time Director of the Company.
Further, during the year, Mr. Aditya Burman has been appointed as Whole Time Director of the Company.

INTERNAL CONTROL SYSTEM

The Company has a proper and adequate internal control system to ensure safeguard and protection of all assets and that the
transactions are authorized, recorded and reported correctly. The Company’s internal control system comprises audit and compliance
by internal audit checks from Price Waterhouse Coopers Private Limited, India, the Internal Auditors. The Internal Auditors independently
evaluate the adequacy of internal controls and concurrently audit the majority of the transactions in value terms. Independence of the
Audit and compliance is ensured by the Direct Reporting of Internal Auditors to the Management Committee of the Board.
Further, in order to further strengthen the Internal Control system of the Company, your Company has successfully implemented the
SAP system integrating the all areas of operation.

DIVIDEND
In view of low profit for the year, your Directors do not propose any dividend for the year.

FIXED DEPOSITS
No fixed deposit has been accepted during the year.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to Directors’ Responsibility Statement,
the Directors confirm:
i) That in the preparation of the annual accounts, the applicable accounting standards have been followed and no material
departures have been made from the same;
ii) That they had selected such accounting policies and applied them consistently and made judgments and estimates that are
reasonable and prudent so as to give true and fair view of the state of affairs of the Company at the end of the financial year and
of the profit of the Company for that period;
iii) That they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and
other irregularities;
iv) That they had prepared the annual accounts on a going concern basis.

AUDITORS REPORT
The observations of Auditors in their report read with the relevant notes to accounts in schedule – 21 are self-explanatory and do not
require further explanation.

PARTICULARS OF EMPLOYEES
Particulars of Employees as required under Section 217(2A) of the Indian Companies Act, 1956 read with Companies (Particular of
Employees) Rules, 1975 as amended are given in Annexure 1 to the Directors Report.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

A. Conservation of Energy
a. Energy Conservation Measures Taken
Your Company has taken following energy conservation measures during the year –
· VFD Drives in Pumps & Motors of Fruit Section has been installed.
· Steam line of Sugar Syrup Preparation Tank has been modified to stop constant draining of steam.
· Jacketed Tank has been replaced by PHEs in Honey Section for attaining desired Filtration & Filling temperature.
· Thermo efficient Coils have been changed in Cooker of Candy Section.
· Energy efficient Refrigeration Unit (both Condensation & Evaporation Unit) has been installed in newly constructed Cold
Stores.
· Automatic Power Factor Control System with 1300 KVAR Capacitor Bank to attain P.F. of 0.98 from present 0.89 has been
commissioned.
b. Additional Investments and Proposals, if any, being Implemented for Reduction of Consumption of Energy
· In order to improve the NEA Power supply on continuous basis and, in turn, reduction of DG operation, a project is going on
to obtain dedicated Feeder and dedicated transmission line from NEA substation to factory.
· Initiations have been taken for procurement of Gasifire Unit to produce Producer Gas from Rice Husk/Biomass to replace F.O.
as Boiler Fuel.
c. Impact of the Measures taken at (a) & (b) above for Reduction of Energy Consumption and Consequent Impact on the
Cost of Production of Goods

2
 · Annual Saving of approximately INR 25 lacs on Overheads from measures taken in (a).
· Annual Saving of approximately INR 100 lacs on Overheads from measures taken in (b).
d. Total energy consumption and energy consumption per unit as per Form A attached herewith as Annexure 2.

B. Technology Absorption
Efforts made in technology absorption as per form B is attached herewith as Annexure 3.

C. Foreign Exchange Earnings and Outgo

Total Foreign Exchange Used during 2008-09: INR 1,21,68.32 lacs.
Total Foreign Exchange Earned during 2008-09: INR 194.18 lacs.

ACKNOWLEDGEMENT
Your Directors wish to place on record their appreciation for the continued support and co-operation extended by Dabur India Limited,
Shareholders, Dealers, Customers and all the employees of the Company.
They also wish to place on record their sincere appreciation for the co-operation, assistance and guidance received from various
officers of the Government of Nepal and Government of India.

On behalf of the Board of Directors

Pradip Burman
(Chairman)
Date : 7th April, 2009

3
 Annexure ‘1’
Statement of particulars of employees pursuant to the provisions of Section 217(2A) of the Companies Act, 1956 read with
Companies (Particulars of Employees) Rules, 1975and forming part of the Director’s Report for the Year Ended 31st March
2009

Name Designation/Nature Qualification Experience Remuner- Date of Age Particulars of Last Em-
of Duties (in Years) ation Appoint- (in Years) ployment
ment
1. Mr. Amit Burman Whole Time Director MBA, Cambridge, 19 39,16,978 3-Mar-08 39 Chief Executive Officer
UK - Dabur Foods Limited
2. Mr. Chetan Burman Executive Director BA in Business Ad- 18 20,00,723 1-May-05 37 Dy. General Manager
ministration, UK - Sales & Mktg., Dabur
India Limited
3. Aditya Burman* Whole Time Director B. Sc. 5 5,18,055 12-Aug-08 29 Fresenius Kabi Oncol-
ogy Limited (Earlier
known as Dabur Phar-
ma Limited)
7. Mr. Udayan Ganguly Chief Executive Di- B. A (Economics), 20 47,24,417 1-Aug-06 43 General Manager -
rector PGDBM (Market- Sales, (North India &
ing) Nepal) Glaxo Smith-
Kline Consumer Health-
care Ltd.
5. Mr. Indranil Gupta Head of Operations B.E. Mechanical 18 40,74,459 1-Aug-07 39 Since 2005 till July 2007
with DILTechnical Head-
Ice Cream Business,
Unilever, India
3. Mr. Atul Nagar DGM Purchase B.Sc. & Diploma 31 26,06,250 1-Sep-06 53 Since 1981 till Aug 2006
in Import & Export with DIL as Sr. Manager
Management and Purchase
Material Manage-
ment

Notes:-
1. Gross Remuneration shown above is subject to Tax and comprises salary including arrears, allowances, rent, medical
reimbursement, leave travel benefits, provident fund, Superannuation fund & gratuity in terms of actual expenditure incurred by
the Company.
2. All the employees have adequate experience to discharge the responsibilities assigned to them.
3. None of the employees mentioned above is a relative of any director.
4. Asterisk (*) against a name indicates that the employee is/was in service for part of the year.
5. Nature of employment is on contractual basis except in the case of directors whose terms have been approved by
shareholders.

4
 Annexure ‘2’
FORM - A
(See Rule 2)
Form of Disclosure of particulars with respect to Conservation of Energy

1. Electricity
a) Purchased
Units 76,45,711 77,80,013
Total Amount (INR) 2,78,89,836 2,80,05,082
Rate per Unit (INR) 3.6 3.6
b) Own Generation
i) Through Diesel Generator
Units 20,66,675 20,62,551
Units Per Liter of Diesel 2.10 3.6
Cost Per Unit (INR) 10.25 10.41
ii) Through Steam Turbine/Generator
Units Nil Nil
Units Per Liter of Fuel Oil Nil Nil
Cost Per Unit (INR) Nil Nil

2. Coal (Specify Quality and Where Used)
Quantity (MT) Nil Nil
Total Cost (INR) Nil Nil
Average Rate Per Ton (INR) Nil Nil

3. Furnace Oil
Quantity (MT) 982.50 1,308.8
Total Cost (INR) 2,68,70,948 2,28,79,279
Average Rate Per Ton (INR) 27,349.36 17,481.11

4. Others – Internal Generation
a) HSD
Quantity (KL) 819.09 660.96
Total Cost (INR) 2,43,16,734 1,85,28,665
Average Rate per KL (INR) 2,9687.5 28032.96
b) LDO
Quantity (KL) Nil Nil
Total Cost (INR) Nil Nil
Average Rate per KL (INR) Nil Nil

B. Consumption per Unit of Production
The Company is engaged in production of variety of products; hence the figures of consumption per unit of
production are not ascertainable.

5
 Annexure 3
Form B
(See Rule 2)
Form of Disclosure of particulars with respect to Technology Absorption, Research and Development (R&D)

Research and Development

1. Specific Areas in Which R&D Carried by the Company ------NIL-------
2. Benefits Derived as a Result of the Above R&D -------NA-------
3. Future Plan of Action -------NIL-------
4. Expenditure on R&D
Capital -------NIL-------
b. Recurring -------NIL-------
c. Total -------NIL-------
d. Total R&D expenditure as a percentage of Total Turnover -------NIL-------

Technology Absorption, Adoption and Innovation

S . Particulars Remarks
No.
1. Efforts in brief, made towards · Installation of state of the art Cold Store for keeping Frozen Fruit Conc.
technology absorption, · Installation of High Pressure Hot Water Jet cleaning System in Fruit Juice Section.
adaptation and innovation · Installation of Hunter Lab to assess the color parameters of Fruit Juice in Fruit Juice Section.
· Installation of on-line Stickering facility on each 1Ltr pack in Fruit Juice Section.
· Installation of on line bottle washing system in Lemoneeze Section.
· Installation of on line coding system in LDM packing line.
· Commencement of production of Hajmola Pudina Tablet.
· Installation of Online Filtration & Filling facility of Honey.
· Installation of Oil Expeller & Filtration System for Badam Tel manufacturing.
· Installation high end Lab Instrument viz.
· High Performance Liquid Chromatography (HPLC) for estimation of purity, assay, etc;
· Gas Chromatograph (GC) for estimation of fatty Acid, Flavors, Perfumes, etc.
· Karl Fischer Apparatus for free Water determination
· Edge Crush Tester, COBB Tester & Compression Strength Tester for analysis of CB Box/tray & other PM.
2. Benefits derived as a result of · Cost Reduction (Cold Store)
the above efforts e.g. product · Process Improvement (On line Unit Operations like Stickering/Bottle Washing/Coding/Filtration etc.)
improvement, cost reduction, · Product. Development (Pudina Hajmola Tablet, Sweet Badam Tel)
product development, import · Quality Improvement (Hunter Lab, Other Lab Instruments)
substitution, etc.
3. In case of imported
technology (imported during NA
the last 5 years reckoned from
the beginning of the financial
year) following information
may be furnished
a)Technology imported
b) Year of import
c) Has technology been fully
absorbed
If not fully absorbed, areas
where this has not taken
place, reasons therefore and
future plans of action.

6
 Auditors’ Report
We have verified the attached Balance Sheet of Dabur Nepal Private Limited, (incorporated at Nepal) as at 31st March, 2009 and
its Profit & Loss Account and the Cash Flow Statement for the year ended on that date, all being made out in accordance with the
requirement of Indian Companies Act, 1956, from the audited accounts of the body corporate under the statute of the country of its
incorporation and additional certified returns which have been relied upon by us (refer note no. B(1), Schedule “N” of Notes to Ac-
counts). These financial statements are the responsibility of the body corporate’s management. Our responsibility is to express an
opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in India. These standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An
audit includes, examining on a test basis, evidence supporting the amounts and disclosures in the financial statement. An audit also
includes assessing the accounting principles used and significant estimates made by management, as well as, evaluating the overall
financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

i. As required by the Companies (Auditors’ Report) Order 2003 issued by the Central Government in terms of section 227 (4A) of
the Indian Companies Act, 1956, we enclose herewith in the annexure a statement of the matter specified therein.
ii. We hereby report that
a) Proper returns necessary for making out the accounts in accordance with the requirement of Indian Companies Act, 1956, were
received by us.
b) We have obtained the information and explanations which to the best of our knowledge and belief were necessary for the
purpose of audit.
c) Proper books of accounts, have been kept by the body corporate.
d) The Balance Sheet and Profit & Loss Account dealt with by this report have been made out from the figures which are in agree-
ment with the books of accounts.
e) Subject to Note No.11 of Notes to Accounts, Balance Sheet and Profit & Loss Account have been prepared in due compliances
of accounting standards referred to in sub-section (3C) of section 211 of Companies Act 1956.
f) In our opinion and according to the information and explanations given to us, the accounts as made out herein read with
other notes appearing in Schedule “N” give the information required by the Companies Act 1956, in the manner so required
to the extent possible and practicable and give a true and fair view in conformity with the accounting principles generally ac-
cepted in India ;
(i) In the case of Balance Sheet, of the State of Affairs of the body corporate as at 31st March 2009 and
(ii) In case of Profit & Loss Account of the profit of the body corporate for the year ended on that date; and
(iii) In the case of Cash Flow statement, of the cash flows of the body corporate for the year ended on that date.

For G Basu & Co

Chartered Accountants
J.N. DHAR
Partner
(M. No. 007117)

7
 ANNEXURE TO THE AUDITORS’ REPORT as REFERRED TO IN PARA I OF THE SAID
REPORT OF EVEN DATE.
1 a. The body corporate has maintained proper records showing full particulars including quantitative details and situation of fixed
assets.
b. The fixed assets have been physically verified by the Management at reasonable intervals. No material discrepancies between
book records and the physical inventories have been noticed on such verification.
c. Fixed assets disposed off during the year were not material enough to affect the going concern identity of the body
corporate.
2 a. The inventories have been physically verified at reasonable intervals by the management.
b. The procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to
the size of the body corporate and the nature of its business.
c. On the basis of our examination of the records of inventory, we are of the opinion that the body corporate is maintaining
proper records of inventory.
The discrepancies noticed on verification between the physical stocks and book records were not material and have been
properly dealt with in the books of accounts.
3 The body corporate has not granted any loan or advance of the nature of loan (secured or unsecured) to any director, body
corporate, company, firm or parties in which directors are interested.
4. The body corporate has not taken any fresh unsecured loan during the year. The body corporate had accepted unsecured loan
of Rs. 48.13 lacs in the previous year, which remains outstanding at the year end. The body corporate is regular in payment of
interest dues. Since the repayment of the loans has still not been demanded, the question of payment of principle due does
not arise. Terms & condition of the loans are not prima-facie prejudicial to the interest of the body corporate.
5. In our opinion and according to the information and explanations given to us there is an adequate internal control system
commensurate with the size of the body corporate and the nature of its business for purchase of inventory and fixed assets
and on the sale of goods. During the course of our audit no major weakness has been noticed in the internal controls. We
have not observed any failure on the part of the body corporate to correct major weakness in internal control system.
6. According to information and explanation given to us, the transactions of purchases and sales with the directors or companies,
firms or parties where the directors are interested, have been made at prices which are reasonable having regard to prevailing
market prices at the relevant time.
7. The body corporate has not accepted deposit from any sources within the meaning of “Acceptance of Deposit Rule” under
Indian Companies Act, 1956.
8. The body corporate has reasonably an adequate internal audit system commensurate with its size and nature of business.
9. Section 209 (i) (d) of the Companies Act, 1956, is not applicable to the body corporate.
10. a. According to information and explanations given to us, the body corporate is depositing with appropriate authorities undisputed
statutory dues to the extent applicable to it.
b We have been informed that there is no undisputed statutory dues as at the year end which is outstanding for a period of six
months from the date the same became payable.
c According to information and explanations given to us, there has been no disputed statutory dues which has not been
deposited.
11. Based on the audit procedures and on the information and explanations available to us, the body corporate has not availed
any facility from any financial institution or debenture holder. As such the question of default does not arise. Regarding loans
from the banks, the same is default free.
12. The body corporate has not granted any loan or advance secured by pledge of share, debenture or other security.
13. Based on our examination of the records and evaluations of the related internal controls and information given to us we are
of the opinion that the body corporate is not dealing in securities, debentures and other investments. It has one long term
investment which is strategically held in its own name.
14. The body corporate has not given guarantees for loans taken by others from banks or financial institutions.
15. No term loan has been availed by the body corporate from any quarter.
16. According to the information and explanations given to us and on the basis of analysis of financial statement of the body
corporate, we are of the opinion that no fund has been raised on short term basis which has been used by the body corporate
for long term application.
17. The Body corporate has not issued any secured debenture during the year.
18. The Body corporate has not raised any fund through public issue or preferential allotment during the year.
19. Based upon the audit procedures performed and information and explanations given to us, we report that no fraud on or by
the body corporate has been noticed or reported during the course of our audit.
20. bv Other clauses of the order are not applicable to the Body corporate.
For G Basu & Co
Chartered Accountants
J.N. DHAR
Partner
(M. No. 007117)

8
 Balance Sheet As at 31st March 2009
(Rs. in lacs)

As At As At
Schedule 31st March 2009 31st March 2008

Sources Of Funds :
Shareholders’ Funds:
Shareholders’ Funds:
(A) Share Capital A 499.08 499.08
(B) Reserves And Surplus B 6,960.51 6,646.55
7,459.59 7,145.63
Loan Funds:
(A) Secured Loans C 3,830.07 4,690.64
(B) Unsecured Loans D 57.24 48.13
3,887.31 4,738.77
Total 11,346.91 11,884.40
Application Of Funds :
Fixed Assets :
(A) Gross Block F 14,433.47 13,674.66
(B) Less : Depreciation 6,879.46 6,244.59
(C) Net Block 7,554.01 7,430.07
Long Term Investment (In Govt. Securities) -
Current Assets, Loans And Advances: G
(A) Inventories 5,516.98 6,174.36
(B) Sundry Debtors 4,115.80 3,353.50
(C) Cash & Bank Balances 246.59 345.69
(D) Loans & Advances 1,148.13 2,950.79
11,027.51 12,824.34
Less: Current Liabilities And Provisions E
(A) Liabilities 6,814.90 7,913.55
(B) Provisions 419.72 459.24
7,234.62 8,372.79
Net Current Assets 3,792.89 4,451.55
Miscellaneous Expenditure - 2.78
(To the extent not written off or adjusted)
Notes To Accounts N
Total 11,346.91 11,884.40


As per our report of even date attached for DABUR NEPAL PRIVATE LIMITED
for G. BASU & CO
CHARTERED ACCOUNTANTS Pradip Burman Chairman
J N DHAR R. S. Rana Managing Director
PARTNER
M. No. 007117

Date : 7th April, 2009

Place Kathmandu

9
 PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH 2009
(Rs. in lacs)
For the Year Ended For the Year Ended
Schedule 31st March 2009 31st March 2008
Income : H
Sales Less Returns 27,199.52 24,474.95
Other Income 133.84 165.02
Total Income 27,333.35 24,639.97
Expenditure :
Cost Of Materials I 20,171.89 17,797.60
Excise Duty 116.53 83.01
Manufacturing Expenses J 1,456.70 1,124.05
Payments To And Provisions For Employees K 1,635.47 1,392.10
Selling And Administrative Expenses L 2,557.59 2,371.19
Financial Expenses M 404.12 453.75
Depreciation 973.54 851.53
Total Expenditure 27,315.83 24,073.23
Balance Being Net Operating Profit Before Tax 17.52 566.74
Provision For Taxation Current 2.74 125.93
Net Profit After Taxation 14.78 440.81
Balance Brought Forward 5,467.50 5,039.09
Provision For Bonus
Provision For Taxation For Earlier Year Written Back 0.00
Provision For Taxation For Earlier Year 12.40 12.40
Profit Available For Appropriation 5,469.88 5,467.50
Appropriation/Allocation
Transferred To Employees Housing Reserve Fund 0.00
Transferred To General ReseRve 0.00
Balance Carried Over To Balance Sheet 5,469.88 5,467.50

As per our report of even date attached for DABUR NEPAL PRIVATE LIMITED
for G. BASU & CO
CHARTERED ACCOUNTANTS Pradip Burman Chairman
J N DHAR R. S. Rana Managing Director
PARTNER
M. No. 007117

Date : 7th April, 2009

Place Kathmandu

10
 STATEMENT OF CASH FLOW
(Rs. in lacs)
For The Year Ended For The Year Ended
Particulars 31st March 2009 31st March 2008

A. Cash flow from operating activities

Net Profit Before Tax And Extraordinary Items 17.52 566.74
Add:
Depreciation 973.54 851.53
Loss On Sale Of Fixed Assets 11.29 (0.02)
Loss On Sale Of Investment 2.81 0.00
Interest 404.12 1,391.76 453.75 1,305.26
Operating Profit Before Working Capital Changes 1,409.28 1,872.00

Working Capital Changes

Increase/(Decrease) In Inventories (657.38) 1,813.19
Increase/(Decrease) In Debtors 762.29 323.94
Decrease/(Increase) In Trade Payables 1,140.90 (3,553.60)
Increase/(Decrease) In Working Capital 1,245.81 (1,416.47)
Cash Generated From Operating Activities 163.47 3,288.47
Interest Paid 404.12 453.75
Tax Paid 2.74 3.08
406.86 456.83
Cash Used(-)/(+)Generated For Operating Activities (A) (243.39) 2,831.64

B. Cash Flow From Investing Activities

Purchase Of Fixed Assets (813.55) (2,416.27)
Sale Of Fixed Assets 2.84 0.00
Sale Of Investment Including Investment In Subsidiaries 2.81 0.00
Cash Used(-)/(+)GeneraTed For Investing Activities (B) (807.90) (2,416.27)

C. Cash Flow From Financing Activities

Repayment(-)/Proceeds (+) Of Long Term Secured Liabilities (283.58) 350.21
Repayment(-)/Proceeds(+) From Short Term Loans (576.99) (1,853.41)
Repayment (-)/Proceeds(+) From Deposits 9.11 0.00
Payment Of Other Advances 1,802.66 1,411.76
Cash Used(-)/+(Generated) In Financing Activities (C) 951.20 (91.44)

Net Increase(+)/Decrease (-) In Cash And Cash Equivalents (A+B+C) (100.10) 323.93

Cash And Cash Equivalents Opening Balance 345.69 21.76

Cash And Cash Equivalents Closing Balance 246.59 345.69

As per our report of even date attached for DABUR NEPAL PRIVATE LIMITED
for G. BASU & CO
CHARTERED ACCOUNTANTS Pradip Burman Chairman
J N DHAR R. S. Rana Managing Director
PARTNER
M. No. 007117

Date : 7th April, 2009

Place Kathmandu

11
SCHEDULES - Annexed to and forming part of the Balance Sheet as at 31st March 2009
(Rs. in lacs)
As At As At
Particulars 31st March 2009 31st March 2008

SCHEDULE-A : SHARE CAPITAL

Authorised :
1400000 Equity Shares Of NRS 100 Each 875.00 875.00
(Previous Year 1400000 Equity Shares Of NRS100 )
875.00 875.00
Issued ,Subscribed & Paid Up
798520 Equity Shares Of NRS 100 Each Fully Paid Up In Cash) 499.08 499.08
778520 Held By Dabur International Ltd, Holding
Company In Corporated In Isle Of Man & Its Nominees
(Previous Year- 798520 Equity Shares Of NRS 100)
499.08 499.08

SCHEDULE-B : RESERVES and SURPLUS

Share Premium Account
As Per Last Account 375.00 375.00
Employees Housing Reserve Fund
As Per Last Account 529.99 495.73
Add : Transferred From Profit & Loss Account 0.79 34.26
530.78 529.99
General Reserve : 584.86 274.06
Profit And Loss Account 5,469.88 5,467.50
Total 6,960.51 6,646.55

SCHEDULE-C : SECURED LOANS

A. Banks and Financial Instituitions
I Term Loans:
Deferred Payment 230.43 514.01
(Secured By Hypothecation Over Machinies Imported Under The Said Facility)

II Short Term Loans - From Banks : 3,599.63 4,176.63

Secured By :
Execution of registered mortgage by deposit of title deeds of company’s entire
land situated at rampur tokani, bara district and the entire immivable properties,
present & future, built thereon and hypothecation & assignment of entire
current assets, present and future, ranking pari-passu amongst Nabil Bank Ltd,
Std. Chartered Bank Nepal Ltd and Nepal SBI Bank Ltd. subject to the priorities
that banks extending term loans ( except that which is covered by guarantees of
indian banks) shall have first charge on the fixed assets and second charge on
current assets while the particpating banks extending working capital, overdraft
and cash credit shall have pari-passu first charge on the current assets and second
charge on fixed assets; and are further secured by a corporate guarantee by the
company’s parent company Dabur India Ltd; New Delhi and by personal guarantee
by a director of the company.
3,830.07 4,690.64

SCHEDULE-D : UNSECURED LOANS

From Directors 48.13 48.13
Security Deposit From Dealers And Others 9.11 0
Total 57.24 48.13

12
SCHEDULES - Annexed to and forming part of the Balance Sheet as at 31st March 2009
(Rs. in lacs)
As At As At
Particulars 31st March 2009 31st March 2008

SCHEDULE-E : CURRENT LIABILITIES AND PROVISIONS

A. C urrent Liabilities :
Acceptance - 2,215.64
Creditors For Goods 620.53 5,244.50
Creditors For Expenses And Other Liabilities 6,156.63 429.54
Advances From Customers 2.72
Interest Accrued But Not Due On Loans 35.03 23.87
6,814.90 7,913.55
B. Provisions :
For Leave Salary 24.77 18.29
For Housing, Bonus & Gratuity & Other Welfares 32.13 80.86
For Taxation :
Brought Forward
Provision For The Year
Adjusted During Year 362.83 360.09
419.72 459.24
7,234.62 8,372.79

SCHEDULE-F : FIXED ASSETS

GROSS BLOCK DEPRECIATION NET BLOCK
Name Of Asset As On Additions Adjustment As On As On For the Adjustment As On As On As On
31.03.08 31.03.09 31.03.08 Year 31.03.2009 31.03.2009 31.03.08
Freehold Land 304.95 20.73 325.68 - - - 325.68 304.95
Building, Roads & 2,484.50 160.11 2,644.62 1,149.48 93.38 1,242.86 1,401.76 1,335.02
Bridges
Plant & Machinery 9,339.58 547.52 9,887.10 4,116.08 763.37 298.06 4,581.40 5,305.70 5,223.49

Furniture & Fixture 917.85 38.71 22.68 933.87 590.56 67.75 18.58 639.73 294.14 327.29
Vehicles 381.30 43.00 32.08 392.23 221.91 41.89 22.04 241.76 150.47 159.40
Computer 229.05 229.05 166.56 7.14 173.70 55.35 62.50

CWIP 17.43 3.50 20.93 - - 20.93 17.43

Total 3,674.67 813.55 54.75 14,433.47 6,244.58 973.54 338.67 6,879.46 7,554.01 7,430.09
Previous Year 10,931.13 889.78 399.12 11,421.80 4,592.58 832.93 8.53 5,416.99 6,004.81

13
SCHEDULES - Annexed to and forming part of the Balance Sheet as at 31st March 2009
(Rs. in lacs)
As At As At
Particulars 31st March 2009 31st March 2008

SCHEDULE-G : CURRENT ASSETS, LOANS AND ADVANCES

A. Current Assets :
Inventories
- Raw Materials 3,016.92 2,213.09
- Goods In Transit
- Packing Materials, Stores And Spares 936.39 1,569.64
- Stock In Process 202.58 102.76
- Finished Goods 1,361.09 2,288.87
5,516.98 6,174.36
Sundry Debtors (Unsecured & Considered Good) 4,115.80 3,353.50
Cash And Bank Balances :
Cash In Hand 1.90 17.28
- Balance With Non Scheduled Banks
In Current Accounts 244.70 323.53
In Fixed Deposit Accounts - 4.88
246.59 345.69
9,879.37 9,873.55
B. Loans And Advances (Unsecured, Considered Good)
Security Deposit With Various Authorities 696.70 340.29
Advance Payment Of Tax 243.35 95.11
Advances To Suppliers 135.10 894.41
Advances To Employees 17.21 116.16
Other advances recoverable in cash or in kind or for value to be received 55.78 1,504.82
1,148.13 2,950.79
Total (A+B) 11,027.51 12,824.34

14
SCHEDULES - Annexed to and forming part of the Profit and Loss Account for the Year Ended 31st March 2009
(Rs. in lacs)
For The Year Ended For The Year Ended
Particulars 31st March 2009 31st March 2008

SCHEDULE-H : SALES AND OTHER INCOME

A. Sales :
Domestic Sales Less Returns 12,324.25 5,836.08
Export Sales 14,875.26 18,638.87
27,199.52 24,474.95
B. Other Income :
Rent Realised 0.08 5.08
Sales of Scrap 133.51 158.46
Miscellaneous Receipts 0.24 0.32
Profit On Sale Of Fixed Assets - 0.02
Interest Received - 1.14
133.84 165.02

SCHEDULE-I : COST OF MATERIALS

Raw Materials Consumed :
I) Opening Stock 2,213.09 1,576.39
II) Add : Purchases 13,536.34 12,465.64
15,749.43 14,042.03
III) Less : Closing Stock 3,016.92 2,213.09
12,732.51 11,828.94
Packing Materials Consumed :
I) Opening Stock 1,569.64 977.23
II) Add : Purchases 5,978.18 6,550.47
7,547.82 7,527.70
III) Less : Closing Stock 936.39 1,569.64
6,611.43 5,958.06
Purchase Of Finished Products - 2,163.41
Adjustment Of Stocks In Process And Finished Goods
Opening Stock :
Stock In Process 102.76 55.76
Finished Products 2,288.87 183.06
2,391.62 238.82
Closing Stock :
Stock-In-Process 202.58 102.76
Finished Products 1,361.09 2,288.87
1,563.67 2,391.62
Increase(-)/Decrease In Stock In Process And Finished Goods 827.97 (2,152.80)
20,171.89 17,797.60

SCHEDULE-J : MANUFACTURING AND OPERATING EXPENSES

ower And Fuel
P 856.78 697.45
Stores & Spares Consumed 277.14 206.55
Repairs & Maintenance
--- Building 73.44 106.01
--- Plant & Machinery 124.69 89.14
--- Others 41.36 24.90
Processing Charges 83.29 -
1,456.70 1,124.05

15
SCHEDULES - Annexed to and forming part of the Profit and Loss Account for the Year Ended 31st March 2009
(Rs. in lacs)
For The Year Ended For The Year Ended
Particulars 31st March 2009 31st March 2008

SCHEDULE-K : PAYMENTS TO AND PROVISIONS FOR EMPLOYEES

Salaries, Wages And Bonus 1,293.42 1,173.39
Contribution To Provident And Other Funds 129.50 63.86
Workmen And Staff Welfare 149.77 110.14
Directors’ Remuneration 62.78 44.71
1,635.47 1,392.10

SCHEDULE-L : SELLING AND ADMINSTRATIVE EXPENSES

Rent 36.62 41.04
Rates And Taxes 1.16 -
Insurance 128.95 85.55
Sales Tax 0.86
Freight And Forwarding Charges 85.39 968.38
Cartage And Coolie - 38.16
Commission, Discount And Rebate 209.20
Advertising And Publicity 847.48 421.08
Travel & Conveyance 229.50 189.51
Legal & Professional 40.09 30.93
Telephone , Fax Expenses 57.81 87.41
Security Expenses 55.27 48.48
General Expenses 831.97 262.80
Auditors’ Remuneration: 3.97 2.13
Donation 15.22 11.34
PrOvsion For Doubtful Debts - 184.38
Loss On Sale Of Investments (Other Than Trade) 2.81 -
Loss On Sale Of Fixed Assets 11.29
2,557.59 2,371.19

SCHEDULE-M : FINANCIAL EXPENSES

Interest (Other Than Fixed Period Loan) 315.43 368.03
Bank Charges 88.69 85.72
404.12 453.75

16
SCHEDULES - Annexed to and forming part of the Accounts for the Period Ended 31st March 2009

Schedule N –Accounting Policies & Notes To Accounts

(All Figures in Rupees Lacs)

A. ACCOUNTING POLICIES
Significant Account Policies are sumarized below
a. Accounting Convention:
The accounts have been prepared in accordance with the historical cost convention.

b. Fixed Assets and Depreciation:

· Fixed assets are stated at cost less impairment loss, if any.
· Cost includes inward freight and expenses incidental to acquisition and installation.
· Depreciation on Fixed Assets have been provided for on straight line method at rates specified in schedule XIV of the Indian
Companies Act 1956.

c. Impairment of Assets:
The body corporate identifies impairable assets at the year-end in term of cash generating unit (CGU) concept based on para-5 to
13 of AS -28 issued by ICAI for the purpose of arriving at impairment loss on fixed assets and capital work-in-progress (as required
under para –34, As-28) being the difference between the book value and recoverable value of relevant assets. Impairment loss
if any when crystallizes is charged against revenue of the year. Entire plant constitute as single CGU.

d. Inventories:
Stocks are valued at lower of cost or net realizable value. Basis of determination of cost remain as follows:
· Raw materials, Packing materials, Stores & Spares On FIFO Basis
· Work-in-process At cost of input plus overhead
upto the stage of completion.
· Finished goods At cost of input plus appropriate Overhead.
e. Retirement Benefits:
Provision is made for gratuity and leave salary payable to the staff in accordance with local labour laws as per management
estimate on the assumption of all employees retiring on year end.
f. Recognition of Income and expenses:
· Sales and purchases are accounted for on the basis of passing of title to the goods.
· All items of incomes and expenses have been accounted for on accrual basis.

g. Contingent Liabilities:
Disputed liabilities and claims including claims raised by fiscal authorities, pending in appeal/court, for which no reliable estimate
can be made of the amount of obligation or which are remotely poised for crystallization are not provided in accounts but
disclosed in notes on accounts. However, present obligation as a result of past event with possibility of outflow of resources,
when reliably estimable, is recognized in accounts.

h. Translation of accounts of the body corporate from the currency of country of it’s incorporation NRS to INR :
Currency of Nepal not being fluctuable vis-à-vis reporting currency, the same has been translated at flat rate determined in the
ratio of Nepalese and Indian currency.

i. Translation of Foreign Currency:

· Receivables/payables (excluding for fixed assets) in foreign currencies are translated at the exchange rate ruling at the year
end and resultant gain or loss, is accounted for in the profit & Loss Account.
· Capital as well as revenue implication of exchange fluctuation charged or credited to revenue, are disclosed in notes to
accounts.

17
B. NOTES TO ACCOUNTS
1. Accounts of the body corporate (a wholly owned subsidiary of Dabur India Ltd., a company incorporated in India), incorporated
in Nepal, originally audited by overseas auditors pursuant to law of the country of its incorporation, have been made out as per
requirement of Indian Companies Act in due adherences of sub section 2(a) and 2(b) of section 212 of Companies Act, 1956. This
entailed drawing up the balance sheet, profit & loss account (including auditor’s report thereon) of the subsidiary in a manner
so as to make it appear conforming to requirements of Indian Companies Act, 1956, for the purpose of annexing the particulars
of the body corporate with its holding company under section 212 (1) of the Companies Act, 1956.

Modification of accounts warranted under the exercise predominantly related to

(a) Translation of treatment of various heads of accounts in terms of accounting standards referred to in section 211(3c) of the
Companies Act, 1956.
(b) Presentation of accounts in terms of schedule VI of Companies Act, 1956, including disclosure of necessary information as
laid down under section 211(1) and 211(2) of Companies Act 1956.

2. Test of impairment in terms of A (C ), schedule N did not prima facie provide any exigency of impairment thereby ruling out the
cause of providing for any impairment loss.

3. Income and Expenditure in Foreign Currency

This being a body corporate incorporated in Nepal., information relating to import, export, expenditure in foreign currency & CIF
value of import are superfluous herein.

4. Managerial Remuneration (paid or payable during the year, to the Directors) :

Payments made to the Directors amount to Rs. 62.78 (previous year Rs. 44.71) on account of salary.

5. Segment Report.
The primary segment identified for body corporate being lone FMCG segment, all the products fall in within its purview, no
segment report has been provided herein.

6. Contingent Liabilities:
a. Claims against the company not acknowledged as debts: In respect of Income Tax under appeal Rs. 42.56 (previous year Rs.
NIL).
b. In respect of bank guarantees executed Rs.2232.29 (previous year Rs.1647.51).
c. In respect of Letter of Credits Rs.1947.85 (previous year Rs.2208.24)
d. Additional demand on account of VAT Rs. 151.25 ( previous year Rs.151.25)
e. Estimated amount of contract remaining to be executed on capital account Rs. 111.29
(previous year Rs. 169.07)

7. CIF value of Imports 2008-09 2007-08

Raw Material 12143.03 11759.89
Packing Material 4169.91 5290.91
Stores & Spares 69.76 98.74
Capital Goods 547.52 2250.06
----------- ----------
16930.22 19400.60
----------- ----------

8. Value of Raw Materials, Stores & Spares consumed

Raw Material Packing Material , Stores & Spares
31.03.2009 31.03.2008 31.03.2009 31.03.2008
Value % Value % Value % Value %
Imported 11217.73 88.10 10993.04 92.93 4846.51 70.36 5324.58 86.37
Indigenous 1514.78 11.90 835.91 7.07 2,042.06 29.64 840.03 13.63
Total 12,732.51 100.00 11,828.95 100.00 6,888.57 100.00 6,164.61 100.00

18
9. Particluars in respect of Goods Manufactured

Class of Goods Unit Licenced Installed Production Opening Stock Closing Stock Sale
Capacity Capacity
Qty Qty Value Qty Value Qty Value
Lal Dant Manjan MT 8,000.00 7,200.00 1,728.14 11.49 7.54 22.39 18.26 1,717.24 1,626.53
(8,000.00) (7,200.00) (3,166.73) (7.96) (9.46) (11.49) (7.54) (3,163.44) (4,341.12)
Real Fruit Juices KL 80,744.00 87,597.00 49,063.53 374.61 2,071.02 788.41 1,063.37 48,649.73 15,993.05
(80,744.00) (87,597.00) (45,560.23) (114.55) (71.97) (374.61) (2,071.02) (45,300.17) (7,723.52)
Others 210.31 279.46 9,579.94
(211.47) (210.31) (12,411.31)
Total 2,288.87 1,361.09 27,199.52
(292.90) (2,288.87) (24,475.95)
(Previous year figures in bracket)

10. Pursuant to adoption of AS 15 as revised by ICAI, treatment of defined benefits obligations have been changed in terms of
standards with the following adjustments incorporated in accounts

A. GRATUITY
(i) Changes in Present Value of Obligation
2008-09 2007-08
Opening defined benefit obligation 90.05 47.18
Current Service Cost 14.33 9.24
Interest Cost 6.40 3.65
Actuarial Gain/Loss due to change in assumption (23.38) 2.88
Amalgamation 0.00 0.00
Benefits Paid (9.33) (8.39)
78.07 54.58

(ii) Change in Fair value of Assets

2008-09 2007-08
Opening Fair Value of Plan Assets 39.19 39.42
Expected return on Plan Assets 3.13 3.15
Employer contribution 17.70 5.39
Actuarial Gain/Loss on Plan Asset (3.13) (0.79)
Benefits Paid (9.33) (8.39)
47.55 38.79

(iii) Amount Recognized in Balance Sheet

2008-09 2007-08
Present value of funded obligations 78.07 54.58
Fair value of plan assets 47.55 38.79
Net liability 30.52 15.78
Amount in Balance sheet provision for Gratuity 30.52 15.78
Net Liabilty 3052 15.79

(iii) Amount Recognized in the Statement of Profit & Loss Account

19
 2008-09 2007-08
Current Service Cost 14.33 9.24
Interest on defined benefits obligations 6.40 3.65
Expected return on plan assets (3.13) (3.15)
Net actuarial loss (20.25) 3.67
Amount included in employee benefit (2.65) 13.42

(iii) Asset information

2008-09 2007-08
Insurer Managed Fund 100% 100%

B. LEAVE ENCASHMENT

(i) Reconciliation of opening and closing balance of the present value of defined benefit obligations:
2008-09 2007-08
Opening defined benefits obligation 18.29 17.62
Current service cost 3.50 1.83
Interest cost 0.85 0.94
Actuarial Gain/Loss due to change in assumption 16.13 11.14
Amalgamation 0.00 0.00
Benefits Paid (14.00) (13.23)
24.77 18.29

(ii) Change in Fair Value of Assets

2008-09 2007-08
Opening fair value of plan assets 0.00 0.00
Expected return on plas assets 0.00 0.00
Employer contribution 0.00 0.00
Benefits paid 0.00 0.00
Ending assets 0.00 0.00

(iii) Amount recognized in Balance Sheet

2008-09 2007-08
Present value of fund obligation 24.77 18.29

20
 Fair value of plan assets 0.00 0.00
Amount in Balance Sheet 24.77 18.29
Provision for Leave encashment 24.77 18.29
Net Liability 24.77 18.29

(iv) A
mount recognized in Statement of Profit & Loss Account
2008-09 2007-08
Current service cost 3.50 1.83
Interest cost 0.85 0.94
Expected return on plan assets 0.00 0.00
Net Actuarial gain/loss to be recorded in the year 16.13 11.94
Amount included in employee benefit expenses 20.48 13.90

(v) Assets Information insurer Managed Funds

2008-09 2007-08
Insurer Managed Fund NA NA

Summary of Actuarial assumptions

2008-09 2007-08
Discount rate 7.5% pa 8.5% pa
Expected rate of return on plan assets 8% pa 8% pa
Salary escalation ratio 0.05 0.06

11. Revenue and capital implication of exchange fluctuation to the extent realized have not been determined. However, this has no
implication on Profit and Loss Account and Balance Sheet.
12. All the figures have been expressed in Rs. Lacs unless stated otherwise.
13. The classification regarding small scale industries as defined under Micro, Small and Medium Development Board, 2006 is not
applicable to this company and the company has not classified its creditors on the basis of the definition of Micro, Small &
Medium Development Board ‘2006.
14. Additional Information as required under Part IV of Schedule VI of the Companies Act.
1. Registration details
Registration No. Not Available
Balance Sheet Date 31/03/2009.

2. Capital Raised during the year (Rs. ‘000)

Public issue nil
Bonus issue nil
Right issue nil
Other Issue nil

3. Position of Mobilisation & deployment of fund (Rs. ‘000)

Total Liabilities 1858152
Total Assets 1858152
Sources of Funds :
Paid up capital 49908
Reserve & Surplus 696050
Secured Loan 383007
Unsecured Loan 5724
Application of funds
Net Fixed Assets 755401
Net current Assets 379289

21
4. Performance of the Company (Rs. ‘000)
Turnover 2732206
Profit before tax 1751
Profit After tax 1477

5. Generic Name of three principal products/ services of the company
Item Code
Product Description
Juices
Hair Oil
Toothpowder
(Item codes not available)

Signatures to the Schedules “A” to “N” Annexed to and forming part of the Accounts.

As per our report of even date attached for DABUR NEPAL PRIVATE LIMITED
for G. BASU & CO
CHARTERED ACCOUNTANTS Pradip Burman Chairman
J N DHAR R. S. Rana Managing Director
PARTNER
M. No. 007117

Date : 7th April, 2009

Place Kathmandu

22