RAINBOW BREWERIES LIMITED ANNUAL REPORT 2002-2003 DIRECTORS' REPORT To the Shareholders Your Directors are presenting herewith 33rd Annual Report alongwith the Audited Balance Sheet of the Company as at 31st March, 2003 and Profit & Loss Account for the year ended on that date FINANCIAL RESULTS: During the year, the Company could achieve sales of Rs.387.48 lakhs against a sales of Rs 639.36 lakhs in last year. This is because, due to circumstances beyond the control of the management, the company remained closed from October, 2002 to March 2003. This has also resulted in a loss of Rs.293.84 Lacs during the year. Capacity utilization was not maximum. The Company's arrangement with M/s United Breweries Ltd., for manufacturing their brands continues, which is expected to improve the position of the Company. (Rs.in Lakhs) 2002-2003 2001-2002 1. Loss before interest Depreciation and Preliminary/Public issue Deferred Expenses 116.34 122.16 2. Interest 30.71 26.17 3. Depreciation 102.67 115.60 4. Preliminary/Public issue/Deferred Expenditure 44.12 44.12 5. Loss for the year 293.84.00 308.04 The Management is hopeful that the Company will perform better in the coming year. DIVIDEND: Your Directors are unable to recommend any dividend for the Financial Year ended 31st March. 2003 in view of continued loss. FUTURE OUTLOOK AND OPERATIONS: The requirements of the franchiser viz. M/s United Breweries Ltd., are ambitious and the Company will be making all out efforts to step-up production in the coming year in order to cater to their requirements, which will in turn improve the financial position AUDITORS & AUDITORS REPORT: M/s DINESH K. SHARMA & ASSOCIATES, Chartered Accountants, Auditors of the Company, retire at the conclusion of the ensuing Annual General Meeting and have expressed their willingness to be re-appointed as Auditors. The Company has received confirmation from M/s DINESH K. SHARMA & ASSOCIATES, Chartered Accountants, to the effect that their appointment, if made, will be within the limits as prescribed in Section 224 of the Companies Act, 1956. DIRECTORS RESPONSIBILITY STATEMENT: It is hereby confirmed: i) That in the preparation of Annual Accounts, the applicable Accounting Standards have been followed alongwith proper explanation relating to material departures, if any ii) That Accounting Policies have been selected and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the State of Affairs of the Company for that period. iii) That proper and sufficient care has been taken 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 vi) That the Directors had prepared the Annual Accounts on a going concern basis PUBLIC DEPOSITS: The Company has not accepted any deposit from the public within the meaning of Section 58A of the Companies Act, 1956 and the rules made thereunder QUALITY CONTROL: Strict quality control is exercised at every stage of manufacturing, starting from incoming raw material upto the outgoing finished products. Testing is done at different stages of production at our laboratory INSURANCE: All the assets of your Company, including Plant & Machinery, Buildings, Equipments etc., have been adequately insured. PARTICULARS OF EMPLOYEES: In accordance with the provisions of Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 there was no employee who was in receipt of remuneration exceeding Rs.12,00,000/- per annum employed for full year or Rs.1,00,000/- per month, if employed for part of the year. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO: a) STEAM Boiler Capacity is utilized to the maximum with minimum wastage. b) WATER: Wastage is minimised. The treated water from Effluent Treatment Plant is utilized in plantation pre-washing of Bottles, refrigeration plant etc. TECHNOLOGY ABSORPTION: Fast fermentation techniques are being exprimented at our laboratory. The quality of Beer produced in the factory is one of the best available in the Country. FOREIGN EXCHANGE EARNINGS & OUTGO: There is no Foreign Exchange earnings and no outgo too during the year. ENVIRONMENT: Developing green belt with plants in the factory premises is an attraction to the Company INDUSTRIAL RELATIONS: During the year under review, relations with employees and officers remained cordial. ACKNOWLEDGEMENT: Your Directors acknowledge the co-operation and continued valuable support received from Customers, Banks, Suppliers, Employees & Officers. On behalf of the Board Sd/- (Avin Jain) Place : Shiwar Managing Director Date : 06/05/03