MIRA INFORM REPORT

Report Date :

17.12.2012

IDENTIFICATION DETAILS

Name :	KAIRA DISTRICT CO-OPERATIVE MILK PRODUCERS UNION LIMITED
Registered Office :	Amul Dairy Mogar Complex, National Highway No. 3, Village Mogar, Anand – 388001, Gujarat
Country :	India
Year of Establishment :	1946
Capital Investment / Paid-up Capital :	Not Divulged
TAN No.: [Tax Deduction & Collection Account No.]	BRDK00963E
PAN No.: [Permanent Account No.]	AAACK9026D
Legal Form :	Subject is a Co-operative Society registered under Co-operative Societies Act.
Line of Business :	Manufacturer, Trader, Exporter and Distributor of ‘Amul’ Brand Milk and Milk Products such as Milk, Milk Powder, Butter Milk, Cheese, Curd, Butter, Ghee, Amul Lite, Nutramal, Chocolate, Pizza etc.
No. of Employees :	735 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

Aa (78)

RATING		STATUS	PROPOSED CREDIT LINE
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large

Status :	Excellent
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject was the first cooperative and modern dairy of the Kaira Union established at Anand, which popularly came to be known as Amul Dairy after its brand name. It is a part of the three-tier dairy cooperative structure of Gujarat which is popularly known as the ‘Anand Pattern’. It is an old and well established, reputed cooperative having excellent track. Trade relations are reported as praiseworthy. Business is active. Payment terms are regular and as per commitments. The company can be considered for business dealings at usual trade terms and conditions.

NOTES:

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

ECGC Country Risk Classification List – June 30, 2012

Country Name	Previous Rating (31.03.2012)	Current Rating (30.06.2012)
India	A1	A1

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

INDIAN ECONOMIC OVERVIEW

India is developing into an open-market economy, yet traces of its past autarkic policies remain. Economic liberalization, including industrial deregulation, privatization of state-owned enterprises, and reduced controls on foreign trade and investment, began in the early 1990s and has served to accelerate the country's growth, which has averaged more than 7% per year since 1997. India's diverse economy encompasses traditional village farming, modern agriculture, handicrafts, a wide range of modern industries, and a multitude of services. Slightly more than half of the work force is in agriculture, but services are the major source of economic growth, accounting for more than half of India's output, with only one-third of its labor force. India has capitalized on its large educated English-speaking population to become a major exporter of information technology services and software workers. In 2010, the Indian economy rebounded robustly from the global financial crisis - in large part because of strong domestic demand - and growth exceeded 8% year-on-year in real terms. However, India's economic growth in 2011 slowed because of persistently high inflation and interest rates and little progress on economic reforms. High international crude prices have exacerbated the government's fuel subsidy expenditures contributing to a higher fiscal deficit, and a worsening current account deficit. Little economic reform took place in 2011 largely due to corruption scandals that have slowed legislative work. India's medium-term growth outlook is positive due to a young population and corresponding low dependency ratio, healthy savings and investment rates, and increasing integration into the global economy. India has many long-term challenges that it has not yet fully addressed, including widespread poverty, inadequate physical and social infrastructure, limited non-agricultural employment opportunities, scarce access to quality basic and higher education, and accommodating rural-to-urban migration.

Source : CIA

EXTERNAL AGENCY RATING

Rating Agency Name	CARE
Rating	Long Term Bank Facilities: AA+
Rating Explanation	High degree of safety and very low credit risk.
Date	January, 2012

Rating Agency Name	CARE
Rating	Short term Bank Facilities: A1+
Rating Explanation	Very Strong degree of safety and lowest credit risk.
Date	January, 2012

RBI DEFAULTERS’ LIST STATUS

Subject’s name is not enlisted as a defaulter in the publicly available RBI Defaulters’ list.

EPF (Employee Provident Fund) DEFAULTERS’ LIST STATUS

Subject’s name is not enlisted as a defaulter in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of 31-03-2012.

INFORMATION DECLINED BY

Name :	Mr. Bhushan
Designation :	Senior Officer
Contact No.:	91-2692-256124
Date :	03.12.2012

LOCATIONS

Registered Office/ Factory :	Amul Dairy Mogar Complex, National Highway No. 3, Village Mogar, Anand – 388001, Gujarat, India
Tel. No.:	91-2692-256124
Fax No.:	91-2692-240225
E-Mail :	amulkai@guj.nic.in
Website :	http://www.amul.com http://www.amuldairy.com
Location :	Owned

DIRECTORS

Name :	Mr. Ramsinh P. Parmar
Designation :	Chairman
Name :	Mr. Gordhan A. Patel
Designation :	Vice Chairman
Name :	Mr. Shivabhai M. Parmar
Designation :	Director
Name :	Mr. Maganbhai G. Zala
Designation :	Director
Name :	Mr. Navinbhai R. Patel
Designation :	Director
Name :	Mr. Pravinbhai M. Patel
Designation :	Director
Name :	Mr. Pravinsinh F. Solanki
Designation :	Director
Name :	Mr. Bhaijibhai A. Zalal
Designation :	Director
Name :	Mr. Raijibhai D. Patel
Designation :	Director
Name :	Ms. Madhuben D. Parmar
Designation :	Director
Name :	Ms. Saryuben B. Patel
Designation :	Director
Name :	Mr. Ranjitbhai K. Patel
Designation :	Director
Name :	Mr. C. B. Kotecha
Designation :	Director
Name :	Mr. B. M. Vyas
Designation :	Director
Name :	Mr. Rahul Kumar
Designation :	Director

KEY EXECUTIVES

Name :	Mr. Sanjay Desai
Designation :	Purchases Department
Name :	Mr. Bhushan
Designation :	Senior Officer

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

NOT AVAILABLE

BUSINESS DETAILS

Line of Business :	Manufacturer, Trader, Exporter and Distributor of ‘Amul’ Brand Milk and Milk Products such as Milk, Milk Powder, Butter Milk, Cheese, Curd, Butter, Ghee, Amul Lite, Nutramal, Chocolate, Pizza etc.
Products :	Ø Infant Milk Food Ø Skimmed Milk Powder Ø Butter Ø Cheese (Cheddar, Mozzarella, Emmental, Gouda) Ø Cheese Spreads Ø Ghee Ø Condensed Milk Ø Chocolates Ø Malted Milk Food Ø Bread Spreads Ø Fresh Milk Ø UHT Milk Ø Ice - Cream

GENERAL INFORMATION

No. of Employees :	735 (Approximately)
Bankers :	· Axis Bank Vallabh Vidyanagar Branch, Anand, Gujarat, India

Banking Relations :	--
Auditors :	Not Available
Associates/Subsidiaries :	· Gujarat State Co-operative Milk Marketing Federation Limited Address: Amul Dairy, Anand – 388001, India Line of Business: Marketing of Milk and Milk Products.

CAPITAL STRUCTURE

NOT DIVULGED

FINANCIAL DATA

[all figures are in Rupees Millions]

NOT DIVULGED

The above information has been declined by Mr. Bhushan.

LOCAL AGENCY FURTHER INFORMATION

Sr. No.	Check List by Info Agents	Available in Report (Yes / No)
1]	Year of Establishment	Yes
2]	Locality of the firm	Yes
3]	Constitutions of the firm	Yes
4]	Premises details	No
5]	Type of Business	Yes
6]	Line of Business	Yes
7]	Promoter's background	No
8]	No. of employees	Yes
9]	Name of person contacted	Yes
10]	Designation of contact person	Yes
11]	Turnover of firm for last three years	No
12]	Profitability for last three years	No
13]	Reasons for variation <> 20%	--
14]	Estimation for coming financial year	No
15]	Capital in the business	No
16]	Details of sister concerns	Yes
17]	Major suppliers	No
18]	Major customers	No
19]	Payments terms	No
20]	Export / Import details (if applicable)	No
21]	Market information	--
22]	Litigations that the firm / promoter involved in	--
23]	Banking Details	Yes
24]	Banking facility details	No
25]	Conduct of the banking account	--
26]	Buyer visit details	--
27]	Financials, if provided	No
28]	Incorporation details, if applicable	No
29]	Last accounts filed at ROC	No
30]	Major Shareholders, if available	No
31]	PAN of Proprietor/Partner/Director, if available	No
32]	Date of Birth of Proprietor/Partner/Director, if available	No
33]	Voter ID No of Proprietor/Partner/Director, if available	No
34]	External Agency Rating, if available	Yes

HISTORY:

Subject was registered on December 14, 1946 as a response to exploitation of marginal milk producers by traders or agents of existing dairies in the small town named Anand (in Kaira District of Gujarat). Milk Producers had to travel long distances to deliver milk to the only dairy, the Polson Dairy in Anand. Often milk went sour as producers had to physically carry the milk in individual containers, especially in the summer season. These agents arbitrarily decided the prices depending on the production and the season. Milk is a commodity that has to be collected twice a day from each cow/buffalo. In winter, the producer was either left with surplus / unsold milk or had to sell it at very low prices. Moreover, the government at that time had given monopoly rights to Polson Dairy (around that time Polson was the most well known butter brand in the country) to collect milk from Anand and supply it to Bombay city in turn. India ranked nowhere amongst milk producing countries in the world because of its limitations in 1946 British Raj.

Angered by the unfair and manipulative trade practices, the farmers of Kaira District approached Sardar Vallabhbhai Patel (who later became the first Deputy Prime Minister and Home Minister of free India) under the leadership of the local farmer leader Tribhuvandas Patel. Sardar Patel advised the farmers to form a Cooperative and supply milk directly to the Bombay Milk Scheme instead of selling it to Polson (who did the same but gave low prices to the producers). He sent Morarji Desai (who later became Prime Minister of India) to organize the farmers. In 1946, the farmers of the area went on a milk strike refusing to be further oppressed. Thus the Kaira District Cooperative was established to collect and process milk in the District of Kaira in 1946. Milk collection was also decentralized, as most producers were marginal farmers who were in a position to deliver 1-2 litres of milk per day. Village level cooperatives were established to organize the marginal milk producers in each of these villages.

The Cooperative was further developed and managed by Dr. V Kurien along with Mr. H M Dalaya. The first modern dairy of the Kaira Union was established at Anand. Indigenous research and development and technology development at the Cooperative had led to the successful production of skimmed milk powder from buffalo milk – the first time on a commercial scale anywhere in the world.

The success of the dairy co-operative movement spread rapidly in Gujarat. Within a short span five other district unions – Mehsana, Banaskantha, Baroda, Sabarkantha and Surat were organized. In order to combine forces and expand the market while saving on advertising and avoid a situation where milk cooperatives would compete against each other it was decided to set up an apex marketing body of dairy cooperative unions in Gujarat. Thus, in 1973, the Gujarat Co-operative Milk Marketing Federation was established. Subejct which had established the brand name Amul in 1955 decided to hand over the brand name to GCMMF (AMUL).

Dr. Verghese Kurien, the World Food Prize and the Magsaysay Award winner, was the architect of India’s White Revolution, which helped India emerge as the largest milk producer in the world.

Impressed with the development of dairy cooperatives in Kaira District and its success, Mr. Lal Bahadur Shastri, the then Prime Minister of India during his visit to Anand in 1964, asked Dr. V Kurien to replicate the Anand type dairy cooperatives all over India. Thus, the National Dairy Developed Board was formed and Operation Flood Programme was launched for replication of the Amul Model all over India.

GCMMF TODAY

GCMMF is India's largest food products marketing organisation. It is a state level apex body of milk cooperatives in Gujarat, which aims to provide remunerative returns to the farmers and also serve the interest of consumers by providing affordable quality products. GCMMF markets and manages the Amul brand. From mid-1990s Amul has entered areas not related directly to its core business. Its entry into ice cream was regarded as successful due to the large market share it was able to capture within a short period of time – primarily due to the price differential and the brand name. It also entered the pizza business, where the base and the recipes were made available to restaurant owners who could price it as low as 30 rupees per pizza when the other players were charging upwards of 100 rupees.

COMPANY INFO

The Gujarat Cooperative milk Marketing Federation Limited, Anand (GCMMF) is the largest food products marketing organisation of India. It is the apex organization of the Dairy Cooperatives of Gujarat. This State has been a pioneer in organizing dairy cooperatives and their success has not only been emulated in India but serves as a model for rest of the World. Over the last five and a half decades, Dairy Cooperatives in Gujarat have created an economic network that links more than 3.1 million village milk producers with millions of consumers in India These cooperatives collect on an average 9.4 million litres of milk per day from their producer members, more than 70% of whom are small, marginal farmers and landless labourers and include a sizeable population of tribal folk and people belonging to the scheduled castes.

The turnover of GCMMF (AMUL) during 2010-11 was Rs.97.74  billion. It markets the products, produced by the district milk unions in 30 dairy plants, The farmers of Gujarat own the largest state of the art dairy plant in Asia – Mother Dairy, Gandhinagar, Gujarat – which can handle 2.5 million litres of milk per day and process 100 MTs of milk powder daily. GCMMF (AMUL)’s Total Quality Management ensures the quality of products right from the starting point (milk producer) through the value chain until it reaches the consumer.

Ever since the movement was launched fifty-five years ago, Gujarat’s Dairy Cooperatives have brought about a significant social and economic change to their rural people. The Dairy Cooperatives have helped in ending the exploitation of farmers and demonstrated that when their rural producers benefit, the community and nation benefits as well.

The Gujarat Cooperative Milk Marketing Federation Limited cannot be viewed simply as a business enterprise. It is an institution created by the milk producers themselves to primarily safeguard their interest economically, socially as well as democratically. Business houses create profit in order to distribute it to the shareholders. In the case of GCMMF the surplus is ploughed back to farmers through the District Unions as well as the village societies. This circulation of capital with value addition within the structure not only benefits the final beneficiary – the farmer – but eventually contributes to the development of the village community. This is the most significant contribution the Amul Model cooperatives has made in building the Nation.

THE THREE-TIER "AMUL MODEL"

The Amul Model is a three-tier cooperative structure. This structure consists of a Dairy Cooperative Society at the village level affiliated to a Milk Union at the District level which in turn is furthler federated into a Milk Federation at the State level. The above three-tier structure was set up in order to delegate the various functions, milk collection is done at the Village Dairy Society, Milk Procurement and Processing at the District Milk Union and Milk and Milk Products Marketing at the State Milk Federation. This helps in eliminating not only internal competition but also ensuring that economies of scale is achieved. As the above structure was first evolved at Amul in Gujarat and thereafter replicated all over the country under the Operation Flood Programme, it is known as the ‘Amul Model’ or ‘Anand Pattern’ of Dairy Cooperatives.

Responsible for Marketing of Milk and Milk Products Responsible for Procurement and Processing of Milk Responsible for Collection of Milk Responsible for Milk Production

VILLAGE DAIRY COOPERATIVE SOCIETY (VDCS)

The main functions of the VDCS are as follows:

· Collection of surplus milk from the milk producers of the village and payment based on quality and quantity

· Providing support services to the members like Veterinary First Aid, Artificial Insemination services, cattle-feed sales, mineral mixture sales, fodder and fodder seed sales, conducting training on Animal Husbandry and Dairying, etc.

· Selling liquid milk for local consumers of the village

· Supplying milk to the District Milk Union

Thus, the VDCS in an independent entity managed locally by the milk producers and assisted by the District Milk Union.

DISTRICT COOPERATIVE MILK PRODUCERS’ UNION (MILK UNION)

The main functions of the Milk Union are as follows:

· Procurement of milk from the Village Dairy Societies of the District

· Arranging transportation of raw milk from the VDCS to the Milk Union.

· Providing input services to the producers like Veterinary Care, Artificial Insemination services, cattle-feed sales, mineral mixture sales, fodder and fodder seed sales, etc.

· Conducting training on Cooperative Development, Animal Husbandry and Dairying for milk producers and conducting specialised skill development and Leadership Development training for VDCS staff and Management Committee members.

· Providing management support to the VDCS along with regular supervision of its activities.

· Establish Chilling Centres and Dairy Plants for processing the milk received from the villages.

· Selling liquid milk and milk products within the District

· Process milk into various milk and milk products as per the requirement of State Marketing Federation.

· Decide on the prices of milk to be paid to milk producers as well on the prices of support services provided to members.

State Cooperative Milk Federation (Federation) The main functions of the Federation are as follows:

· Marketing of milk and milk products processed / manufactured by Milk Unions.

· Establish distribution network for marketing of milk and milk products.

· Arranging transportation of milk and milk products from the Milk Unions to the market.

· Creating and maintaining a brand for marketing of milk and milk products (brand building).

· Providing support services to the Milk Unions and members like Technical Inputs, management support and advisory services.

· Pooling surplus milk from the Milk Unions and supplying it to deficit Milk Unions.

· Establish feeder-balancing Dairy Plants for processing the surplus milk of the Milk Unions.

· Arranging for common purchase of raw materials used in manufacture / packaging of milk products.

· Decide on the prices of milk and milk products to be paid to Milk Unions.

· Decide on the products to be manufactured at various Milk Unions (product-mix) and capacity required for the same.

· Conduct long-term Milk Production, Procurement and Processing as well as Marketing Planning.

· Arranging Finance for the Milk Unions and providing them technical know-how.

· Designing and Providing training on Cooperative Development, Technical & Marketing functions.

· Conflict Resolution and keeping the entire structure intact.

They have around 176 cooperative dairy Unions formed by 1,25,000 dairy cooperative societies having a total membership of around 13 million farmers on the same pattern, who are processing and marketing milk and milk products profitably, be it Amul in Gujarat or Verka in Punjab, Vijaya in Andhra Pradesh or a Nandini in Karnataka. This entire process has created more than 190 dairy processing plants spread all over India with large investments by these farmers’ institutions. These cooperatives today collect approximately 23 million kgs. of milk per day and pay an aggregate amount of more than Rs.125 billion to the milk producers in a year.

IMPACT OF THE "AMUL MODEL"

The effects of Operation Flood Programme are more appraised by the World Bank in its recent evaluation report. It has been proved that an investment of Rs. 20 billion over 20 years under Operation Flood Programme in 70s and 80s has contributed in increase of India’s milk production by 40 Million Metric Tonne (MMT) i.e. from about 20 MMT in pre- Operation Flood period to more than 60 MMT at the end of Operation flood Programme. Thus, an incremental return of Rs. 400 billion annually have been generated by an investment of Rs. 20 billion over a period of 20 years. This has been the most beneficial project funded by the World Bank anywhere in the World. One can continue to see the effect of these efforts as India’s milk production continues to increase and now stands at 90 MMT. Despite this fourfold increase in milk production, there has not been drop in the prices of milk during the period and has continued to grow.

Due to this movement, the country’s milk production tripled between the years 1971 to 1996. Similarly, the per capita milk consumption doubled from 111 gms per day in 1973 to 222 gms per day in 2000. Thus, these cooperatives have not just been instrumental in economic development of the rural society of India but it also has provided vital ingredient for improving health and nutritional requirement of the Indian society. Very few industries of India have such parallels of development encompassing such a large population.

These dairy cooperatives have been responsible in uplifting the social and economic status of the women folk in particular as women are basically involved in dairying while the men are busy with their agriculture. This has also provided a definite source of income to the women leading to their economic emancipation.

The three-tier ‘Amul Model’ has been instrumental in bringing about the White Revolution in the country. As per the assessment report of the World Bank on the Impact of Dairy Development in India, the ‘Anand Pattern’ has demonstrated the following benefits:

· Have multi-dimensional impacts

· The importance of getting government out of commercial enterprises

· The importance of market failure in agriculture

· The power and problems of participatory organisations

· The importance of policy

ACHIEVEMENTS OF THE "AMUL MOVEMENT"

The dairy cooperatives have been able to maintain democratic structure at least at the grass-root level with the management committee of the village level unit elected from among the members in majority of the villages.

The dairy cooperatives have also been instrumental in bridging the social divide of caste, creed, race, religion and language at the villages, by offering open and voluntary membership.

ACHIEVEMENTS OF GCMMF

· 3.1 million milk producer member families

· 15,760 village societies

· 15 District Unions

· 9.4 million liters of milk procured per day

· Rs. 150 million disbursed in cash daily

· GCMMF is the largest cooperative business of small producers with an annual turnover of Rs. 53 billion

· The Govt. of India has honoured Amul with the “Best of all categories Rajiv Gandhi National Quality Award”.

· Largest milk handling capacity in Asia

· Largest Cold Chain Network

· 48 Sales offices, 5000 Wholesale Distributors, 7 lakh retail outlets

· Export to 37 countries worth Rs.1500.000 Millions

· Winner of APEDA award for nine consecutive years

AMUL BRAND BUILDING

GCMMF (AMUL) has the largest distribution network for any FMCG company. It has nearly 50 sales offices spread all over the country, more than 5,000 wholesale dealers and more than 7,00,000 retailers.

AMUL is also the largest exporter of dairy products in the country. AMUL is available today in over 40 countries of the world. AMUL is exporting a wide variety of products which include Whole and Skimmed Milk Powder, Cottage Cheese (Paneer), UHT Milk, Clarified Butter (Ghee) and Indigenous Sweets. The major markets are USA, West Indies, and countries in Africa, the Gulf Region, and [SAARC] SAARCneighbours, Singapore, The Philippines, Thailand, Japan and China.

In September 2007, Amul emerged as the leading Indian brand according to a survey by Synovate to find out Asia's top 1000 Brands.

In 2011, Amul was named the Most Trusted brand in the Food and Beverages sector in The Brand Trust Report, published by Trust Research Advisory.

India's top 20 brands: Amul is No. 1: Rediff.com

PRODUCTS

Amul's product range includes milk powders, milk, butter, ghee, cheese, Masti Dahi, Yoghurt, Buttermilk chocolate, ice cream, cream, shrikhand, paneer, gulab jamuns, flavoured milk, basundi, Nutramul brand and others. In January 2006, Amul plans to launch India's first sports drink Stamina, which will be competing with Coca Cola's Powerade and PepsiCo's Gatorade.

In August 2007, Amul introduced Kool Koko, a chocolate milk brand extending its product offering in the milk products segment. Other Amul brands are Amul Kool, a low calorie thirst quenching drink; Masti Butter Milk; Kool Cafe, ready to drink coffee and India's first sports drink Stamina.

Amul's sugar-free Pro-Biotic Ice-cream won The International Dairy Federation Marketing Award for 2007.

MASCOT

Since 1967 Amul products' mascot has been the very recognisable "Amul baby" (a chubby butter girl usually dressed in polka dotted dress) showing up on hoardings and product wrappers with the equally recognisable tagline Utterly Butterly Delicious Amul.The mascot was first used for Amul butter. But in recent years in a second wave of ad campaign for Amul products, she has also been used for other product like ghee and milk.

An Amul butter ad on Pakistan's Kargil War fiasco. The image shows the "Amul baby" in between George Fernandes and Atal Behari Vajpayee.

ADVERTISING

In 1966, Amul hired Sylvester daCunha, then managing director of the advertising agency AS to design a new ad campaign for Amul Butter. daCunha designed an add campaign as series of hoardings with topical ads, relating to day-to-day issues. The campaign was widely popular and earned a Guiness world record for the longest running ad campaign in the world. Since the 1980s, cartoon artist Bharat Dabholkar has been involved with sketching the Amul ads, who rejected the trend of using celebrities in advertisement campaigns. Dabholkar credited chairman Varghese Kurien with creating a free atmosphere that fostered the development of the ads.

Despite encountering political pressure on several occasions, daCunha's agency has made it a policy of not backing down. Some of the more controversial Amul ads include one commenting on Naxalite uprising in West Bengal, on the Indian Airlines employees strike, and the one depicting the Amul butter girl wearing a Gandhi cap.

Amul hired DraftFCB+Ulka for the brands of Amul milk, chocolates, paneer, ghee, ice-cream.

IN POPULAR CULTURE

The establishment of Amul is also known as White Revolution. The White Revolution of India inspired the notable Indian film-maker Shyam Benegal to base his film Manthan (1976) on it. The film starred Smita Patil, Girish Karnad, Naseeruddin Shah and Amrish Puri. The film itself was financed by over five lakh rural farmers in Gujarat who contributed Rs 2 each to the film'š budget. Upon its release, these same farmers went in truckloads to watch 'their' film, making it a commercial success, the film was chosen for the 1977 National Film Award for Best Feature Film in Hindi. The Amul success story is taken up as a case study in marketing in many premier management institutes across the world.

The White Revolution ushered an era of plenty from a measly amount of milk production and distribution. Aside from the great measurable success that this project was, it also demonstrated the power of "collective might". A small set of poor farmers of Kheda district in Gujarat had the vision and foresight to act in a way that was good for the society and not for the self alone.

MILK, THE INSPIRATION BEHIND A REVOLUTION

Over six decades ago the life of a farmer in Kaira was very much like that of farmers anywhere else in India. His income was derived almost entirely from seasonal crops. Many poor farmers faced starvation during off-seasons. Their income from milch buffaloes was undependable. The milk marketing system was controlled by contractors and middlemen. As milk is perishable, farmers were compelled to sell their milk for whatever they were offered. Often they had to sell cream and ghee at a throwaway price.

They were in general illiterate. But they could see that the system under which contractors could buy their produce at a low price and arrange to sell it at huge profits was just not fair. This became more noticeable when the Government of Bombay started the Bombay Milk Scheme in 1945. Milk had to be transported 427 kilometers, from Anand to Bombay. This could be done only if milk was pasteurized in Anand.

After preliminary trials, the Government of Bombay entered into an agreement with Polsons Limited to supply milk from Anand to Bombay on a regular basis. The arrangement was highly satisfactory to all concerned – except the farmers. The Government found it profitable; Polsons kept a good margin. Milk contractors took the biggest cut. No one had taken the trouble to fix the price of milk to be paid to the producers. Thus under the Bombay Milk Scheme the farmers of Kaira District were no better off ever before. They were still at the mercy of milk contractors. They had to sell their milk at a price the contractors fixed. The discontent of the farmers grew. They went in deputation to Sardar Patel, who had advocated farmers’ co-operatives as early as 1942.

Sardar Patel reiterated his advice that they should market their milk through a co-operative society of their own. This co-operative should have its own pasteurization plant. His advice was that the farmers should demand permission to set up such a co-operative. If their demand was rejected, they should refuse to sell their milk to middlemen.

Sardar Patel pointed out that in undertaking such a strike there should be some losses to the farmers as they would not be able to sell their milk for some time. If they were prepared to put up with the loss, he was prepared to lead them. The farmers’ deputation readily accepted his proposal.

Sardar then sent his trusted deputy, Mr. Morarjibhai Desai, to Kaira District to organize milk co-operative – and a milk strike if necessary. Mr. Desai held a meeting in Samarkha village on January 4, 1946. It was resolved that milk producers’ co-operative societies should be organized in each village of Kaira District to collect milk from their member-farmers. All the milk societies would federate into a Union which would own milk processing facilities. The Government should undertake to buy milk from the Union. If this wasn’t done, the farmers would refuse to sell milk to any milk contractor in Kaira District.

The Government turned down the demand. The farmers called a ‘milk strike’. It lasted 15 days. Not a drop of milk was sold to the milk merchants. No milk reached Bombay from Anand, and the Bombay Milk Scheme almost collapsed. After 15 days the milk commissioner of Bombay, an Englishman, and his deputy visited Anand, assessed the situation and accepted the farmers’ demand.

This marked the beginning of the Kaira District Co-operative Milk Producers’ Union Limited, Anand. It was formally registered on December 14, 1946. Its objective was to provide proper marketing facilities for the milk producers of the district. The Union began pasteurizing milk in June 1948, for the Bombay Milk Scheme – just a handful of farmers in two village co-operative societies producing about 250 liters a day.

An assured market proved a great incentive to the milk producers in the district. By the end of 1948, 432 farmers had joined village societies, and the quantity of milk handled by the Union had increased to 5000 liters a day.

In the early stages, rapid growth brought in its wake serious problems. Their solution provided the stimulus for further growth. For example, as the co-operative movement spread in the district, it was found that the Bombay Milk Scheme could not absorb the extra milk collected by the Union in winter, when buffaloes yielded an average of 2.5 times their summer yield. Thus by 1953, the farmer-members had no regular market for the extra milk produced in winter. They were again forced to sell a large surplus at low rate to middlemen

The only remedy was to set up a plant to process the extra milk into products like butter and milk powder. The logic of this step was readily accepted by the Government of Bombay and the Government of India, except for a few doubting Thomases. The government of India helped the Union to get

financial help from UNICEF and assistance from the Government of New Zealand under the Colombo Plan. Technical aid was provided by F.A.O. A Rs.50 – lakh factory to process milk powder and butter was blueprinted. Its foundation stone was laid by the then President of India the late Dr. Rajendra Prasad on November 15, 1954. The project was completed by October 31, 1955, on which day the late Pandit Jawaharlal Nehru, the then Prime Minister of India, declared it open. The new dairy provided a further fillip to the co-operative movement among milk producers. The union was thus enabled to organize more village co-operative societies and to handle more and more milk each year. This event also brought a breakthrough in dairy technology as the products were made processing buffalo milk for the first time in the world. Kaira Union introduced the brand “Amul” for marketing its product range. The word “Amul” is derived from Sanskrit word ‘Amulya’ which means ‘priceless’ or precious’. In the subsequent years Amul made cheese and baby food on a large commercial scale again processing buffalo milk creating a history in the world.

1964 was the turning point in the history of dairy development programme in India. Late Mr. Lal Bahadur Shastri, the then Prime Minister of India who visited Anand on 31^st October for inauguration of Amul’s Cattle Feed Plant, having spent a night with farmers of Kaira and experiencing the success wished and expressed to Mr Kurien, then the General Manager of Amul that replicating Amul model through out their country will bring a great change in the socio-economic conditions of the people. In order to bring this dream into reality, 1965 The National Dairy Development Board (NDDB) was established at Anand and by 1969-70 NDDB came out with the dairy development programme for India popularly known as “Operation Flood” or “White Revolution”. The Operation Flood programme, even today, stands to be the largest dairy development programme ever drawn in the world. This saw Amul as model and this model is often referred in the history of White Revolution as “Anand Pattern”. Replication of “Anand Pattern” has helped India to emerge as the largest milk producing nation in the world.

CMT REPORT (Corruption, Money Laundering & Terrorism]

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

1] INFORMATION ON DESIGNATED PARTY

No exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.

2] Court Declaration :

No records exist to suggest that subject is or was the subject of any formal or informal allegations, prosecutions or other official proceeding for making any prohibited payments or other improper payments to government officials for engaging in prohibited transactions or with designated parties.

3] Asset Declaration :

No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.

4] Record on Financial Crime :

Charges or conviction registered against subject: None

5] Records on Violation of Anti-Corruption Laws :

Charges or investigation registered against subject: None

6] Records on Int’l Anti-Money Laundering Laws/Standards :

Charges or investigation registered against subject: None

7] Criminal Records

No available information exist that suggest that subject or any of its principals have been formally charged or convicted by a competent governmental authority for any financial crime or under any formal investigation by a competent government authority for any violation of anti-corruption laws or international anti-money laundering laws or standard.

8] Affiliation with Government :

No record exists to suggest that any director or indirect owners, controlling shareholders, director, officer or employee of the company is a government official or a family member or close business associate of a Government official.

9] Compensation Package :

Our market survey revealed that the amount of compensation sought by the subject is fair and reasonable and comparable to compensation paid to others for similar services.

10] Press Report :

No press reports / filings exists on the subject.

CORPORATE GOVERNANCE

MIRA INFORM as part of its Due Diligence do provide comments on Corporate Governance to identify management and governance. These factors often have been predictive and in some cases have created vulnerabilities to credit deterioration.

Our Governance Assessment focuses principally on the interactions between a company’s management, its Board of Directors, Shareholders and other financial stakeholders.

CONTRAVENTION

Subject is not known to have contravened any existing local laws, regulations or policies that prohibit, restrict or otherwise affect the terms and conditions that could be included in the agreement with the subject.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.54.39
UK Pound	1	Rs.87.78
Euro	1	Rs.71.29

INFORMATION DETAILS

Information Gathered by :	SVA
Report Prepared by :	NIT

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	7
PAID-UP CAPITAL	1~10	8
OPERATING SCALE	1~10	9
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	9
--PROFITABILIRY	1~10	9
--LIQUIDITY	1~10	9
--LEVERAGE	1~10	9
--RESERVES	1~10	9
--CREDIT LINES	1~10	9
--MARGINS	-5~5	--
DEMERIT POINTS
--BANK CHARGES	YES/NO	Yes
--LITIGATION	YES/NO	No
--OTHER ADVERSE INFORMATION	YES/NO	No
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	No
--EXPORT ACTIVITIES	YES/NO	No
--AFFILIATION	YES/NO	Yes
--LISTED	YES/NO	No
--OTHER MERIT FACTORS	YES/NO	Yes
TOTAL		78

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended
--	NB	New Business	--

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.