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Radico Khaitan Ltd.

BSE: 532497 Sector: Consumer
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OPEN 213.50
VOLUME 139187
52-Week high 226.00
52-Week low 105.95
P/E 34.04
Mkt Cap.(Rs cr) 2,869
Buy Price 0.00
Buy Qty 0.00
Sell Price 214.75
Sell Qty 173.00
OPEN 213.50
CLOSE 211.80
VOLUME 139187
52-Week high 226.00
52-Week low 105.95
P/E 34.04
Mkt Cap.(Rs cr) 2,869
Buy Price 0.00
Buy Qty 0.00
Sell Price 214.75
Sell Qty 173.00

Radico Khaitan Ltd. (RADICO) - Director Report

Company director report

Dear Members

Your Directors are pleased to present their Thirty Second Annual Report on the businessand operations together with the audited financial statement of the Company for the yearended March 31 2016.

Summary of Financial Performance:

( Rs in Crore)
FY 2016 FY 2015
Net Sales (including sales from arrangements with other Distilleries / Bottling units) 1789.17 1846.46
Gross Profit (before depreciation and tax) 148.04 125.44
Profit before tax 107.70 87.13
Profit after tax 76.89 67.64
Prior period adjustments 0.00 0.00
Surplus brought forward from last year 88.49 98.61
Profit available for appropriation 165.66 166.25
Transfer to General Reserve 50.00 50.00
Proposed Dividend and tax thereon 12.81 12.81
Balance carried forward 102.86 88.49

Operations Review:

FY2016 continued to be a very challenging year for global economy and in particular forthe spirits industry in India. The Indian spirits industry has slowed down in recent yearsfrom double digits to low single digit volume growth. However the high value premiumsegment has not been impacted by this slowdown. This trend was also reflected in theCompany's performance. While overall IMFL volume declined (6.6)% to 181.93 lakh cases inFY2016 Prestige & Above category brands registered a volume growth of 8.9% y-o-y inFY2016 to reach 44.02 lakh cases. Prestige & Above category brands as a percentage oftotal IMFL sales increased from 20.7% in FY2015 to 24.2% in FY2016. Net Sales declined by(3.1)% to Rs. 1789.2 Crore.

Despite subdued sales performance Radico Khaitan delivered a strong operatingperformance with EBITDA increasing by 14.2% to Rs. 194.6 Crore and EBITDA marginsexpanding by 165 bps to 10.9%. This was achieved through a combination of the Company'srelentless focus on cost optimisation better product mix and stabilising input pricetrend. Interest expenses decreased from Rs. 89.9 Crore in FY2015 to Rs. 84.7 Crore inFY2016. Net profit improved by 13.7% to Rs. 76.9 Crore with a 4.3% margin.

Capital Structure and Liquidity:

Share Capital

During the year under review the Company granted 530000 stock options under theEmployees Stock Option Scheme 2006. These shares well vest with employees in next fouryears.

General Reserve

An amount of Rs.50 Crore has been transferred to the General Reserve out of RadicoKhaitan's profit of Rs.76.88 Crore for the financial year ended March 31 2016.

Term Loan and Working Capital

As of March 31 2016 Total Debt was Rs. 851.4 Crore Cash & Cash Equivalents wereRs. 10.6 Crore resulting in Net Debt of Rs. 840.9 Crore (vs. Rs. 838.9 Crore as of March31 2015). Total Debt consists of Rs. 509.9 Crore of Working Capital loans and Rs. 341.5Crore of Long Term loans including Long Term loans maturing within 12 months of thebalance sheet date. Total Debt includes a sum of Rs. 15.5 Crore being the notional impactof the depreciation of the rupee on foreign currency loans (ECB). During FY2016 theCompany reduced the Long Term ECBs from $53.2 million to $41.4 million. Working Capitalloans increased during the same period due to seasonality impact.

As of March 31 2016 Radico Khaitan had a conservative leverage with Debt/Equity ratioof 0.94x and Net Debt/EBITDA of 4.3x.

Capital Market Ratings:

The Company continued to enjoy investment grade credit rating from Credit Analysis& Research Ltd (CARE) which has re-affirmed the rating of "CARE A+" assignedfor the long term facilities. CARE A+ rating is considered to have adequate degree ofsafety regarding timely servicing of financial obligations. Such instruments carry lowcredit risk.

CARE has re-affirmed the rating of "CARE A+" assigned for the short termfacilities which is considered to have very strong degree of safety regarding timelyservicing of financial obligations. Such instruments carry lowest credit risk.


As per Rule 8 (5) (iii) of the Companies Accounts Rules 2014 Mr. Abhishek Khaitan gotreappointed during the financial year 2015-16. There was no change in other directors andKMP's.

Board Meetings:

During FY2016 the Board of Directors met 4 (four) times on 22nd May 2015 10th August2015 9th November 2015 and 5th February 2016. The period between any two consecutivemeetings of the Board of Directors of the Company was not more than 120 days. The detailsregarding composition number of Board Meetings held and attendance of the directorsduring FY2016 are set out in the Corporate Governance Report as annexed with the report.

Meeting of Independent Directors:

The Independent Directors of the Company met separately on 5th February 2016 withoutthe presence of the Non-Independent Directors and the members of management. The meetingwas conducted informally to enable the Independent Directors to discuss matters pertainingto the Company's affairs and put forth their combined views to the Board of Directors ofthe Company. In accordance with the Listing Agreement following matters were inter-aliadiscussed in the meeting:

1) Review of the performance of Non-Independent Directors and the Board as a whole;

2) Review of the performance of the Chairperson of the Company taking into account theviews of Executive Directors and Non-Executive Directors;

3) Assessment the quality quantity and timelines of flow of information between theCompany management and the Board that is necessary for the Board to effectively andreasonably perform their duties

Familiarization Programme for the Independent Directors:

Radico Khaitan has developed a well-structured orientation programme for theIndependent Directors to provide them an opportunity to familiarize with the Company itsmanagement and its operations so as to gain a clear understanding of their roles andresponsibilities. This program is intended to familiarise the new Board members about theCompany's strategy products and offerings operations and facilities economicenvironment organisation structure human resource finance technology quality and riskmanagement. The induction programme includes one-to-one interactive sessions with the topmanagement team business and functional heads among others and also includes visit tothe manufacturing facilities to understand operations and technology.

In pursuit of this the Directors are updated on a continuing basis on developments inthe corporate and industry scenario including those pertaining to regulatory and economicenvironment to enable them to take well informed and timely decisions. The details of thefamiliarisation programme may be accessed on the Company's corporate website at

Declaration by Independent Directors:

The Company has received declarations from all Independent Directors that they meet thecriteria of Independence as laid down under Section 149 (6) of the Companies Act 2013SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 and Clause 49 ofthe Listing Agreement. The Company keeps a policy of transparency and arm's length whiledealing with its Independent Directors. No transaction was entered with Independentdirectors in the year which could have any material pecuniary relationship with them.Apart from sitting fee no other remuneration was given to any of the IndependentDirectors.

Board Evaluation:

The Board of Directors has laid down the manner in which formal annual evaluation ofthe performance of the Board Committees and individual Directors has to be made. RadicoKhaitan has in place a comprehensive and structured questionnaire for evaluation of theBoard and its Committees Board composition and its structure effectiveness functioningand information availability. This questionnaire also covers specific criteria and thegrounds on which all Directors in their individual capacity will be evaluated.

The performance evaluation of the Independent directors was done by the entire Boardexcluding the director being evaluated. The performance evaluation of the Chairman and theNon-Independent directors was carried out by the Independent directors. The Board ofDirectors expressed their satisfaction with the evaluation process.

Policy on Nomination Remuneration and Board Diversity u/s 178(1)

The Board of Directors has framed a policy which lays down a framework in relation toremuneration of Directors Key Managerial Personnel and Senior Management of the Company.This policy also lays down criteria for selection and appointment of Board Members as wellas diversity of the Board. Radico Khaitan recognizes the benefits and importance of havinga diverse Board of Directors in terms of skill set and experience. The Company has anoptimum mix of executive and non-executive independent directors and woman director. Thedetail of the policy is explained in the Corporate Governance Report.

Risk Management Policy:

Risk management is embedded in Radico Khaitan's corporate strategies and operatingframework. The Company has in place comprehensive risk assessment and minimizationprocedures integrated across all operations and entails the recording monitoring andcontrolling enterprise risks and addressing them timely and comprehensively. The risks arereviewed by the Risk Management Committee Audit Committee and the Board from time to timeand new risks are identified based on new business initiatives and the same are assessedminimisation framework and controls are designed and appropriately implemented.

Awards and Recognition:

During the year Radico Khaitan received numerous awards for its leading brands atvarious international events. These awards are testament to the Company's understanding ofthe customer preference as well as the superior quality of its products. Some of theawards received during the year were:

Award Details:

Name of the Brands Monde Selection Quality Awards 2016
Magic Moments Remix Lemongrass & Ginger Flavoured Vodka Grand Gold
Magic Moments Remix Peach Flavoured Vodka Grand Gold
Magic Moments Vodka Gold
Magic Moments Remix Green Apple Flavoured Vodka Gold
Morpheus Brandy Gold
Magic Moments Remix Orange Flavoured Vodka Gold
Magic Moments Remix Lemon Flavoured Vodka Gold
Magic Moments Remix Chocolate Flavoured Vodka Gold
Magic Moments Remix Raspberry Flavoured Vodka Gold
M2 Verve Super Premium Vodka Gold
M2 Verve Magic Moments Green Apple Premium Flavoured Vodka Gold
M2 Verve Magic Moments Orange Premium Flavoured Vodka Gold
Magic Moments Electra Cosmopolitan Silver
Magic Moments Electra Appletini Silver
Magic Moments Electra Agent Orange Silver
Magic Moments Electra Starry Night Martini Silver

Employee Stock Option Scheme:

Radico Khaitan's employee stock option scheme was implemented to provide the employeeswith an opportunity to share in the growth of the Company and to reinforce long termcommitment. The Compensation Committee at its meetings held on 23.11.2015 granted530000 stock options to the eligible employees as per the Employees Stock Option Scheme2006. The particulars of the options as required by SEBI (Share Based Employee Benefits)Regulations 2014 are appended as Annexure A and forms part of this report.


The Company has a dividend policy that balances the dual objective of appropriatelyrewarding its shareholders and retaining capital to support future growth. Your Directorsare pleased to recommend a dividend of Rs. 0.80 per equity share or 40% on face value ofRs. 2.00 each for the year ended March 31 2016. The total dividend payout for thefinancial year will be Rs. 106431012.00 including a dividend distribution tax of Rs.21666849.78. This consistent dividend payout is to demonstrate our commitment towards ourshareholders. The dividend is subject to approval of shareholders at the Annual GeneralMeeting scheduled to be held on 11th July 2016 and will be paid to the shareholders whosenames appear in the Register of Members as on the date of book closure i.e. from 6.7.2016to 11.7.2016 (both days inclusive).


During the year 235455 shares of the Company constituting 0.18% of the issued andsubscribed Share Capital of the Company were dematerialised. Around 98.07% of the sharesof the Company have now been dematerialized as on March 31 2016. Your Directors wouldrequest all the members who have not yet converted their holdings into dematerializedform to do so thereby facilitating trading of their shares. As per SEBI guidelines it isnow mandatory that the shares of a company are in dematerialized form for trading.

Public Deposits:

During the year under review your Company has neither invited nor accepted any fixeddeposits from the public within the meaning of Section 73 of the Companies Act 2013 readwith the Companies (acceptance of Deposits) Rules 2014.

Subsidiaries and Joint Ventures:

During the year under review the Company has no subsidiary company. Radico Khaitan hasone joint venture namely Radico NV Distilleries Maharashtra Limited. The Company has 36%stake in the said JV.

Transfer to Investor Education & Protection Fund:

Section 124 of the Companies Act 2013 (Section 205A of the Companies Act 1956)mandates that companies transfer dividend that has been unclaimed for a period of sevenyears from the unpaid dividend account to the Investor Education and Protection Fund(IEPF). To ensure maximum disbursement of unclaimed dividend the Company sends remindersto the concerned investors before transfer of dividend to IEPF. Unclaimed dividend hasbeen transferred to IEPF as per below table:

Financial Year Date of Declaration of Dividend Total Dividend ( Rs ) Unclaimed Dividend as on 31-3-2016 ( Rs ) Due Date of Transfer to IEPF account
FY 2002 16.07.2002 38579176.00 730556.00 22.08.2009
FY 2003 19.07.2003 34721258.40 914312.00 24.08.2010
FY 2004 17.07.2004 38579176.00 973284.00 22.08.2011
FY 2005 16.11.2005 42437093.60 983341.00 21.12.2012
FY 2006 25.09.2006 48223970.00 1135840.00 30.10.2013
FY 2007 26.09.2007 51231109.50 922432.00 05.11.2014
FY 2008 30.09.2008 51231109.50 1065509.00 16.10.2015

Key Managerial Personnel:

There has been no change in Key Managerial Personnel during the year under review.

Remuneration of the Directors and Employees:

Radico Khaitan's remuneration policy aims at attracting and retaining high qualitytalent. Your Company's approach is to have performance based compensation culture. Theremuneration policy therefore is market-led and takes into account the competitivecircumstance of the business so as to attract and retain quality talent and leverageperformance significantly.

The remuneration payable to each executive Director is based on the remunerationstructure as determined by the Board and is revised from time to time depending uponindividual contribution the Company's performance and the provisions of the CompaniesAct 2013.

Particulars of Employees:

In accordance with the provisions of Section 197 (12) of the Companies Act 2013 readwith Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 the names and other particulars of employees are to be set out inthe Directors' Report as an addendum thereto. During FY2016 Seven (7) persons employedthroughout the year were in receipt of remuneration of Rs. 60 lacs per annum or moreamounting to Rs. 80846178. During FY2016 the Company had a total of 1115 employees asper Annexure B.

The above annexure is not being sent along with this Report to the Members of theCompany in line with the provision of Section 136 of the Companies Act 2013. Members whoare interested in obtaining these particulars may write to the Company Secretary at theRegistered Office of the Company. The aforesaid Annexure is also available for inspectionby Members at the registered Office of the Company 21 days before the 32nd Annual generalmeeting and up to the date of the ensuing Annual General meeting during the business hourson working days.

None of the employees listed in the said annexure is a relative of any Director of theCompany. None of the employees hold (by himself or along with his spouse and dependentchildren) more than two percent of the equity shares of the Company.

The information required under Section 197 (12) of the Companies Act 2013 read withRule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014and forming part of the Directors' Report for the year ended March 31 2016 is given in aseparate Annexure - B to this Report.

The Business Responsibility Reporting as required by Section 134 (5) of the CompaniesAct 2013 is not applicable to your Company for the financial year ending March 31 2016.

Audit Report for the Year Ended FY2016:

The observations made in the Auditors Report are self-explanatory and therefore do notcall for any further comments under Section 134 of the Companies Act 2013.

Statutory Auditor:

The Board of Directors in their meeting held on 25th May 2016 has taken on record thespecial notice received from a shareholder as well as recommendation of the AuditCommittee for the appointment of M/s. BGJC & Associates Chartered Accountants (FirmRegistration No. 003304N) as Statutory Auditors of the Company for a consecutive term of5 years in place of the retiring Auditors M/s. V. Sankar Aiyar & Co. and hasrecommended the same to the Shareholders for their approval in the ensuing AGM. Writtenconsent of the proposed auditors together with a certificate certifying that theappointment if made shall be in accordance with the conditions specified in Rule 4 ofthe Companies (Audit & Auditors Rules) 2014 has been received.

Cost Auditor:

As per the requirement of Central Government and pursuant to Section 148 of theCompanies Act 2013 read with the Companies (Cost Records and Audit) Rules 2014 asamended from time to time your Company has been carrying out audit of cost recordsrelating to Industrial Alcohol every year.

The Board of Directors on the recommendation of audit committee has appointed Mr.S.N. Balasubramanian Cost Accountants as cost auditor to audit the cost accounts of theCompany for the financial year 2017 at a remuneration of Rs. 1 lac plus service tax asapplicable and reimbursement of out of pocket expenses. As required under the CompaniesAct 2013 a resolution seeking member's approval for the remuneration payable to the CostAuditor forms part of the Notice convening the Annual General Meeting.

Secretarial Audit:

Pursuant to the provisions of Section 204 of the Companies Act 2013 and rules madethereunder the Company has appointed M/s. Tanuj Vohra & Associates a firm of CompanySecretaries in Practice (C.P. No. 5253) to undertake the Secretarial Audit of the Company.The Secretarial Audit Report is included as Annexure - C and forms an integral part ofthis Report. There is no secretarial audit qualification for the year under review.

Internal Control Systems and their Adequacy:

Radico Khaitan has an elaborate internal control system commensurate to the size of theCompany and its operations. This system continuously monitors compliance to internalprocesses across the operations to ensure that all assets are safeguarded and protectedagainst loss from unauthorised use or disposition that transactions are authorisedrecorded and reported correctly and that operations are conducted in an efficient and costeffective manner. The policies are in place relating to financial and operationalcontrols.

The internal audit function periodically performs audit of various processes andactivities. The Audit Committee reviews the effectiveness of the Internal Control Systemand also invites functional Directors and Senior

Management personnel to provide periodic updates on operational effectiveness andcontrols. A CEO and CFO Certificate forming part of the Corporate Governance Reportconfirms the existence and effectiveness of internal controls. The Company has appointedGrant Thornton as their internal auditors which in turn submits quarterly reports to theAudit Committee. The Company has also appointed external agency to review the InternalControl Systems and they have in turn reported on the effectiveness and efficiency ofInternal Control Systems. Being an ongoing exercise the management continuous to work onthe same.

Particulars of Loans Guarantees or Investment by the Company:

Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to Financial Statements.

Vigil Mechanism:

Pursuant to the requirement of section 177 (9) & (10) of the Companies Act 2013Radico Khaitan has adopted a Vigil Mechanism which allows employees of the Company toraise their concerns relating to fraud malpractice or any other activity or event whichis against the interest of the Company or society as a whole. Details of complaintsreceived and the action taken are reviewed by the Audit Committee. The functioning of theVigil Mechanism is reviewed by the Audit Committee from time to time. The Vigil MechanismPolicy has been uploaded on the website of the Company at

Archival Policy:

Pursuant to the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 and in line with Radico Khaitan's Policy on Determination of Materiality of Eventsand as per the Regulations the Company shall disclose all such events to the StockExchanges and such disclosures shall be hosted on the website of the Company for a periodof 5 years and thereafter the same shall be archived so as to be available for retrievalfor a further period of three years by storing the same on suitable media. Thereafter thesaid information documents records may be destroyed as per the policy on preservation ofdocuments.

Related Party Transactions:

All transactions entered with Related Parties for the year under review were on arm'slength basis and in the ordinary course of business and that the provisions of Section 188of the Companies Act 2013 are not attracted. Thus disclosure in form AOC-2 is notrequired. Further there are no material related party transactions during the year underreview with the Promoters directors or Key Managerial Personnel. The Company hasdeveloped a Related Party Transactions framework through Standard Operating Procedures forthe purpose of identification and monitoring of such transactions.

All Related Party Transactions are placed before the Audit Committee as also to theBoard for approval. Omnibus approval was obtained on a quarterly basis for transactionswhich are of repetitive nature. Transactions entered into pursuant to omnibus approval areaudited by the Risk Assurance Department and a statement giving details of all RelatedParty Transactions are placed before the Audit Committee and Board for review and approvalon a quarterly basis.

The policy on Related Party Transactions as amended and approved by the Board ofDirectors has been uploaded on the website of the Company. The web-link of the same hasbeen provided in the Corporate Governance Report. None of the directors has any pecuniaryrelationship of transactions vis--vis the Company.

Environmental Protection Measures Taken by the Company:

In view of the corporate responsibility on Environmental Protection the Company hasadopted a number of measures to improve in the field of environment safety and health.Measures like standard operating procedures training programmes for all levels ofemployees regarding resource conservation housekeeping Green Belt development and onsiteemergency plan have been taken. Sustainable living is a part of long-term businessstrategy and your Company continuously strives to reduce our environmental footprintwhile enhancing the livelihood of millions of people across our product value chain.

Energy Conservation Technology Absorption and Foreign Exchange Earnings and Outgo:

As per Section 134 (3) (m) read with the Companies (Accounts Rules) 2014 the relevantinformation and data is given at Annexure – D.

i) the steps taken or impact on conservation of energy;

ii) the steps taken by the company for utilising alternate sources of energy;

iii) the capital investment on energy conservation equipment;

The Company has continued its efforts to improve energy usage efficiencies andendeavours to identify and evaluate the risks associated with the future energy expansion.Furthermore your Company views foreign exchange as a priority and engages with theoverseas markets in a fair and careful manner to seek growth for the business.

Corporate Social Responsibilities (CSR):

Radico Khaitan is a responsible corporate citizen supporting activities related to thebenefit of the society as a whole. The Company is committed to improve quality of lives ofpeople in the community its serves through long term stakeholder value creation withspecial focus on empowerment of communities in rural India. As part of its CSR programmesthe Company partners with the community and addresses issues of water and sanitationeducation health and skill-building. Radico Khaitan also promotes and encouragesresponsible drinking through engaging with employees taking preventative actioneducation & raising awareness and bringing communities on board to address localchallenges at their root.

Composition of the Committee:

1. Dr. Lalit Khaitan Chairman
2. Mr. K.P. Singh Member
3. Mr. Ashutosh Patra Member
4. Ms. Shailja Devi Member

The Company's projects are in accordance with Schedule VII of the Companies Act 2013and the Company's CSR policy. The Report on CSR activities as required under Companies(Corporate Social Responsibility Policy) Rules 2014 is set out as Annexure - E formingpart of this Report. Apart from the CSR activities under the Companies Act 2013.

Significant and Material Orders Passed by the Regulators or Courts:

There has been no significant and material order passed by the Regulators or Courtsthat would impact the going concern status of the Company and its future operations.

Safety & Wellbeing of Women:

Gender equality and women safety is a very important part of Radico Khaitan's humanresource policies. The Company has zero tolerance for sexual harassment at workplace andhas adopted a Policy on prevention prohibition and redressal of sexual harassment atworkplace in line with the provisions of the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 and the Rules thereunder for preventionand redressal of complaints of sexual harassment at workplace. During the year underreview there were no sexual harassment cases reported to the Company.

Directors' Responsibility Statement:

To the best of knowledge and belief and according to the information and explanationsobtained by them your

Directors make the following statement in terms of Section 134 (3) (c) of the CompaniesAct 2013.

i) that in the preparation of the Annual Accounts for the year ended March 31 2016the applicable accounting standards have been followed along with proper explanationrelating to material departures if any;

ii) and applied them consistently and made judgements and estimates that are reasonableand prudent so as to give a true and fair view of the state of affairs of the Company asat March 31 2016 and of the profit of the Company for the year ended on that date;

iii) that the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities.

iv) the annual accounts have been prepared on a going concern basis;

v) that the Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and

vi) that the Directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.

Extract of Annual Return:

Pursuant to Section 92 (3) of the Companies Act 2013 and Rule 12 (1) of the Companies(Management and Administration) Rules 2014 the extract of the Annual Return is providedin Annexure - F

Management Discussion and Analysis for FY2016:

Management Discussion and Analysis Report as required under the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 and forms part of this report.

Corporate Governance Report for FY2016:

Report on Corporate Governance along with the certificate of statutory Auditors M/s.V. Sankar Aiyar & Co. confirming compliance of conditions of Corporate Governance asstipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 forms part of the Annual Report.


Your Directors would like to express their sincere appreciation to the investors andbankers for their continued support during the year. Your Directors extend their sinceregratitude to all the Regulatory Authorities such as SEBI Stock Exchanges and otherCentral & State Government authorities and agencies Registrars for their guidance andsupport. The Board also appreciates the support and co-operation your Company has beenreceiving from its supply chain partners and others associated with the Company as itstrading partners. Your Company looks upon them as partners in its progress and has sharedwith them the rewards of growth.

Your Directors place on record their deep appreciation to employees at all levels fortheir efforts dedication and commitment. Their enthusiasm and hard work has enabled theCompany to be at the forefront of the industry. We also take this opportunity to thank allour valued customers who have appreciated our products.

For and on behalf of the Board
Dr. Lalit Khaitan
Place: New Delhi Chairman & Managing Director
Date: 25.05.2016 DIN - 00238222