MIRA INFORM REPORT

Report Date :

18.07.2012

IDENTIFICATION DETAILS

Name :	DABUR INDIA LIMITED FEM CARE PHARMA LIMITED AMALGAMATED WITH DABUR INDIA LIMITED
Formerly Known As :	DABUR (DR. S K BURMAN) PRIVATE LIMITED
Registered Office :	8/3 Asaf Ali Road, New Delhi – 110 002
Country :	India
Financials (as on) :	31.03.2012
Date of Incorporation :	16.09.1975
Com. Reg. No.:	55-007908
Capital Investment / Paid-up Capital :	Rs.1742.100 Millions
CIN No.: [Company Identification No.]	L24230DL1975PLC007908
TAN No.: [Tax Deduction & Collection Account No.]	DELD01285E
Legal Form :	A Public Limited Liability Company. The Company’s Share are Listed on the Stock Exchange.
Line of Business :	Manufacturing of herbal healthcare and personal care, food, pharmaceuticals, ayurvedic medicines, veterinary products and cosmetics.
No. of Employees :	5650 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

A (69)

RATING		STATUS	PROPOSED CREDIT LINE
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

Maximum Credit Limit :	USD 52000000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a fourth largest FMCG Company in India with interest in Health Care, Personal Care and Food Products. It is a well-established and reputed company having good track. Financially company is performing good. Fundamentally seem to be strong. The company have created its brand in the market. Trade relations are reported as fair. Business is active. Payments are reported to be regular and as per commitments. The company can be considered good for normal business dealings at usual trade terms and conditions. Note : FEM CARE PHARMA LIMITED got amalgamated with DABUR INDIA LIMITED in the yeas June 2010

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 – September 30, 2011

Country Name	Previous Rating (30.06.2011)	Current Rating (30.09.2011)
India	A1	A1

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

LOCATIONS

Registered Office :	8/3 Asaf Ali Road, New Delhi – 110 002, India
Tel. No.:	91-11-23253488
Fax No.:	Not Available
E-Mail :	investors@dabur.com
Website :	http://www.dabur.com
Corporate Office :	Dabur Tower, Kaushambi, Sahibabad, Ghaziabad - 201 010, Uttar Pradesh, India
Tel. No.:	91-120-3982000 (30 Lines) / 39412525
Fax No.:	91-120-4374935 / 3001000 (30 Lines)
Factory 1 : :	Sahibabad Unit I and II, Plot No. 22, Site IV, Sahibabad, Ghaziabad – 201010, Uttar Pradesh, India
Tel. No.:	91-120-3008700 (30 Lines)
Fax No.:	91-120-2779914 / 4376924
Factory 2 :	Hajmola Unit 109, HPSIDC Industrial Area, Baddi, District Solan – 173205, Himachal Pradesh, India
Tel. No.:	91-1795-244385
Fax No.:	91-1795-244090
Factory 3 :	Chyawanprash Unit 220-221, HPSIDC Industrial Area, Baddi, District Solan – 173205, Himachal Pradesh, India
Factory 4 :	Amla /Honey Unit Village Billanwali Lavana, Baddi, District Solan – 173205, Himachal Pradesh, India
Factory 5 :	Glucose Unit, Plot No. 12, Industrial Area, Baddi, District Solan – 173205, Himachal Pradesh, India
Factory 6 :	Shampoo Unit, Village Billanwali Lavana, Baddi, District Solan – 173205, Himachal Pradesh, India
Factory 7 :	Toothpaste Unit, Village Billanwali Lavana, Baddi, District Solan – 173205, Himachal Pradesh, India
Factory 8 :	Honitus/Nature Care Unit, 1 09, HPSIDC Industrial Area, Baddi, District Solan – 173205, Himachal Pradesh, India
Factory 9 :	Food Supplement Unit, 221, HPSIDC Industrial Area, Baddi, District Solan - 173205, Himachal Pradesh, India
Factory 10 :	Oral Care Unit, 601, Malku Majra, Nalagarh Road, Baddi, District Solan - 173205, Himachal Pradesh, India
Factory 11 :	Green Field Unit, Village Manakpur, Tehsil Baddi, District Solan - 174101, Himachal Pradesh, India
Factory 12 :	Air Freshener Unit / Toothpowder Unit, Village Billanwali Lavana, Baddi, District Solan - 173205, Himachal Pradesh, India
Factory 14 :	Skin Care Unit / Honey Unit Village Manakpur, Tehsil Baddi, District Solan - 174101, Himachal Pradesh, India
Factory 15 :	Pantnagar: Unit I and Unit II, Plot No.4, Sector-2, Integrated Industrial Estate, Pantnagar, District. Udham Singh Nagar - 263146, Uttarakhand, India
Tel. No.:	91-5944-398500
Fax No.:	91-5944-250064
Factory 16 :	Jammu: Unit I, II and III, Lane No.3, Phase II, SIDCO Industrial Complex, Bari Brahmna, Jammu,
Tel. No.:	91-1923-220123, 221970, 222341
Fax No.:	91-1923-221970
Factory 17 :	Katni: 10.4 Mile Stone, NH -7, Village Padua, KATNI - 483442, Madhya Pradesh, India
Tel. No.:	91-7622-262317, 262297, 297507
Factory 18 :	Alwar : SP-C 162, Matsya Industrial Area, Alwar - 301 030, Rajasthan, India
Tel. No.:	91-144 - 2881542 / 5132101 / 5132102
Fax No.:	91-144 – 2881302
Factory 19 :	Pithampur : 86-A, Kheda Industrial Area, Sector-3, Pithampur - 454774, District. - Dhar Madhya Pradesh, India
Tel. No.:	91-7292 - 400046 to 51
Fax No.:	91-7292 - 400112
Factory 20 :	Narendrapur : 9, Netaji Subhash Chandra Bose Road, P.O. - Narendrapur, Kolkata - 700103, West Bengal, India
Tel. No.:	91-33-24772324 - 26, 2477 2620, 2477 2738, 2477 2740
Fax No.:	91-33-24772621
Factory 21 :	Silvassa : Unit – I and II, Survey No. 225/4/1, Village Saily, Silvassa – 396230, Dadra and Nagar Haveli, India
Tel. No.:	91-260-2681071 / 72 / 73 / 74
Fax No.:	91-260 –2681075
Factory 22 :	Newai : G 50-59, IID Centre, NH-12, Road No.1, Newai - 304020, District. Tonk – 304020, Rajasthan – India
Tel. No.:	01438 -223342, 223783, 223892,
Fax No.:	01438- 223010
Factory 23 :	Jalpaiguri : Kartowa, P.O. Mahanvita, P.S. Rajganj, Distt. Jalpaiguri - 735135, West Bengal, India
Factory 24 :	Nashik : D-55, MIDC, Ambad, Nashik – 422 010, Maharashtra, India,
Tel. No.:	0253- 6623222
Fax No.:	0253- 2383146, 2383577

DIRECTORS

As on 31.03.2012

Name :	Dr. Anand Burman
Designation :	Chairman
Name :	Mr. Amit Burman
Designation :	Vice Chairman
Date of Birth/Age :	16.07.1969
Qualification :	MBA, Cambridge University, England
Date of Appointment :	01.11.2001
Name :	Mr. Saket Burman
Designation :	Director
Date of Birth/Age :	0.03.1977
Qualification :	BBA in Marketing and Finance from the University of Wisconsin, Madison.
Date of Appointment :	31.01.2012
Name :	Mr. Mohit Burman
Designation :	Director
Name :	Mr. P. D. Narang
Designation :	Director
Name :	Mr. Sunil Duggal
Designation :	Director
Name :	Mr. R. C. Bhargava
Designation :	Director
Name :	Mr. P. N. Vijay
Designation :	Director
Name :	Dr. S. Narayan
Designation :	Director
Date of Birth/Age :	20.06.1943
Qualification :	M.Sc-Physics, MBM Finance, M.Phill-Cambridge, Ph.D. IIT Delhi, IAS(Retd.)
Date of Appointment :	27.07.2005
Name :	Mr. Albert Wiseman Paterson
Designation :	Director
Date of Birth/Age :	07.08.1958
Qualification :	B.Sc. (Hons) Mathematics, ACII, Post Graduate Certifi cate in Education.
Date of Appointment :	30.10.2008
Name :	Mr. Analjit Singh
Designation :	Director
Date of Birth/Age :	11.01.1954
Qualification :	BA, BS, MBA (Boston)
Date of Appointment :	30.10.2008
Name :	Dr. Ajay Dua
Designation :	Director

KEY EXECUTIVES

Name :	Mr. A. K. Jain
Designation :	Senior General Manager (Finance) And Company Secretary

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 31.03.2012

Category of Shareholders	No. of Shares	% of Holdings
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Individuals / Hindu Undivided Family	2178000	0.13
Bodies Corporate	1,194,160,850	68.55
Sub Total	1,196,438,850	68.68
(2) Foreign
Individuals (Non-Residents Individuals / Foreign Individuals)	300,000	0.02
Sub Total	300,000	0.02
Total shareholding of Promoter and Promoter Group (A)	1,196,738,850	68.70
(B) Public Shareholding
(1) Institutions
Mutual Funds / UTI	18,762,520	1.08
Financial Institutions / Banks	56,238,419	3.23
Insurance Companies	37,274,147	2.14
Foreign Institutional Investors	320,883,652	18.42
Sub Total	433,158,738	24.86
(2) Non-Institutions
Bodies Corporate	11,619,923	0.67
Individuals
Individual shareholders holding nominal share capital up to Rs.0.100 million	75,971,528	4.36
Individual shareholders holding nominal share capital in excess of Rs.0.100 million	17,604,268	1.01
Any Others (Specify)	7,007,547	0.40
Overseas Corporate Bodies	6,000	-
Non Resident Indians	6,155,909	0.35
Clearing Members	657,906	0.04
Trusts	187,732	0.01
Sub Total	112,203,266	6.44
Total Public shareholding (B)	545,362,004	31.30
Total (A)+(B)	1,740,100,854	100.00
(C) Shares held by Custodians and against which Depository Receipts have been issued	-	-
(1) Promoter and Promoter Group	-	-
(2) Public	-	-
Sub Total
Total (A)+(B)+(C)	1,740,100,854	100.00

BUSINESS DETAILS

Line of Business :

Manufacturing of herbal healthcare and personal care, food, pharmaceuticals, ayurvedic medicines, veterinary products and cosmetics.

Products :

Item Code No. (ITC Code)	Product Description
30049001	Ayurvedic Medicines
33059001	Hair Oils
33061000	Dentifrices

· Health Care

o Baby Care

o Health

o Supplements

o Digestives

o Natural Cures

· Personal Care

o Hair Care

o Oral Care

o Skin Care

PRODUCTION STATUS (AS ON 31.03.2011)

Particulars	Unit	Installed Capacity	Actual Production
Hair Oils	Kilo-ltrs	108419	31075
Chyawanprash	Tonnes	59927	17804
Honey	Tonnes	9341	6479
Tooth Powder and Paste	Tonnes	52882	28276
Hajmola	Tonnes	12239	5496
Asava – Arishta	Kilo-ltrs	11403	8100
Fruits,Nector and Drinks	Kilo-ltrs	35700	22470
Vegetable Pastes	Mt	4800	1258

GENERAL INFORMATION

No. of Employees :

5650 (Approximately)

Bankers :

· Punjab National Bank

· Standard Chartered Bank

· The Hongkong and Shanghai Banking Corporation Limited

· The Royal Bank of Scotland

· Citibank N.A.

· HDFC Bank Limited

· IDBI Bank Limited

· North Kanara GSB

· Indusind Bank Limited

Facilities :

(Rs. In Millions)

Secured Loan	As on 31.03.2012	As on 31.03.2011
Foreign Currency Term Loans from Bank	0.000
Deffered payment Liability	0.000	175.700
Cash Credit from Banks	191.200
Total	191.200	175.700
Unsecured Loan	As on 31.03.2012	As on 31.03.2011
Deferred Sales Tax Liabilities	11.400
Loan from Banks	1500.000
Packing Credit Loan from Banks	1030.100	2398.700
Security Deposits	45.400
Total	2586.900	2398.700
Note: 1. There is no default in repayment of principal loan or interest thereon. 2. No Guarantee Bond has been furnished against any loan. 3. Cash Credits are secured by hypothecation of inventories and book debts among bankers in consortium eg. Punjab National Bank , Standard Chartered Bank Limited, Hongkong and Shanghai Banking Corporation Limited., Royal Bank of Scotland, IDBI Bank Limited, Citi Bank N.A. and HDFC Bank Limited.

Banking Relations :	--
Auditors :
Name :	G. Basu and Company Chartered Accountants
Internal Auditors :	Price Waterhouse Coopers Private Limited
Domestic Wholly Owned Subsidiary :	H and B Stores Limited
Foreign wholly Owned Subsidiary :	Dermoviva Skin Essentials Inc. Dabur Egypt Limited, Egypt Dabur (UK) Limited, UK Dabur International Limited, UAE African Consumercare Limited, Nigeria Naturelle LLC, UAE Dabur Egypt Trading Limited, Egypt Hobi Kozmetik Ra Pazarlama Namaste Laboratories Hair Rejuvenation and Revitalization Nigeria Limited Healing Hair Lab International LLC, USA Healing Hair Lab International LLC, USA Urban Lab International LLC, USA Dabur Lanka Private Limited, Sri Lanka
Foreign Subsidiary:	Asian Consumercare Private Limited., Dhaka Dabur Nepal Private Limited, Nepal Weikfield International (UAE) LLC Asian Consumercare Pakistan Private Limited, Pakistan
Joint Venture :	Forum 1 Aviation Limited

CAPITAL STRUCTURE

As on 31.03.2012

Authorised Capital :

No. of Shares	Type	Value	Amount
2000000000	Equity Shares	Rs. 1/- each	Rs.2000.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
1742100854	Equity Shares	Rs.1/- each	Rs.1742.100 Millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2012	31.03.2011	31.03.2010
SHAREHOLDERS FUNDS
1] Share Capital		1742.100	1740.700	869.000
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		11290.600	9270.900	6624.800
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		13032.700	11011.600	7493.800
LOAN FUNDS
1] Secured Loans		191.200	175.700	242.700
2] Unsecured Loans		2586.900	2398.700	857.000
TOTAL BORROWING		2778.100	2574.400	1099.700
DEFERRED TAX LIABILITIES		271.100	174.000	119.500
TOTAL		16081.900	13760.000	8713.000
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		5853.300	4975.600	4509.500
Capital work-in-progress		115.800	119.200	233.100
INVESTMENT		5527.200	5192.300	3485.100
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	5285.700	4605.800	2984.400
	Sundry Debtors	2241.700	2024.600	1304.800
	Cash & Bank Balances	2912.900	1924.100	1639.100
	Other Current Assets	522.200	0.000	0.000
	Loans & Advances	5410.000	4405.300	3251.200
Total Current Assets		16372.500	12959.800	9179.500
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	5851.100	1935.100	988.700
	Other Current Liabilities	550.100	3027.700	3331.900
	Provisions	5924.000	5353.600	4401.000
Total Current Liabilities		12325.200	10316.400	8721.600
Net Current Assets		4047.300	2643.400	457.900
MISCELLANEOUS EXPENSES		538.300	829.500	27.400
TOTAL		16081.900	13760.000	8713.000

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2012	31.03.2011	31.03.2010
	SALES
		Income	37593.300	32806.100	28559.600
		Other Income	533.500	263.500	416.400
		TOTAL (A)	38126.800	33069.600	28976.000
Less	EXPENSES
		Cost of materials consumed	14837.000	12740.500
		Purchase of stock in trade	5957.200	4549.100
		Changes in inventories of FG, WIP & Stock in trade:
		Finished Goods	(187.800)	(577.800)
		Work in Progress	(319.100)	(127.800)	23251.700
		Stock in trade	(86.400)	(77.500)
		Employee benefits expenses	2433.700	2172.800
		Other Expenses	8373.200	7628.700
		Extraordinary Items	448.900	0.000
		TOTAL (B)	31456.700	26308.000	23251.700
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		6670.100	6761.600	5724.300
Less	FINANCIAL EXPENSES (D)		141.000	120.000	134.900
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		6529.100	6641.600	5589.400
Less/ Add	DEPRECIATION/ AMORTISATION (F)		658.800	679.000	319.100
	PROFIT BEFORE TAX (E-F) (G)		5870.300	5962.600	5270.300
Less	TAX (H)		1237.900	1248.500	938.900
	PROFIT AFTER TAX (G-H) (I)		4632.400	4714.100	4331.400
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		NA	5269.100	4289.400
Less	APPROPRIATIONS
		Interim Dividend	NA	870.400	649.800
		Proposed Final Dividend	NA	1131.500	1086.200
		Final Dividend (for earlier year)	NA	1.500	0.000
		Corporate Tax on Interim Dividend	NA	144.600	110.400
		Corporate Tax on Proposed Dividend	NA	183.600	184.600
		Excess Corporate Tax on dividend of earlier year provided written back	NA	(4.000)	0.000
		Transfer to Capital Reserve	NA	13.400	20.700
		Transfer to General Reserve	NA	500.000	1300.000
	BALANCE CARRIED TO THE B/S		NA	7142.200	5269.100
	EARNINGS IN FOREIGN CURRENCY
		Export sales at FOB	1671.900	1316.900	1237.300
		Interest Income	0.000	24.700	0.000
	TOTAL EARNINGS		1671.900	1341.600	1237.300
	IMPORTS
		Raw Materials	177.300	134.000	188.200
		Stores & Spares	8.000	2.800	1.800
		Capital Goods	121.700	63.100	41.300
	TOTAL IMPORTS		307.000	199.900	231.300
	Earnings Per Share (Rs.)
	Basic		2.66	2.71	2.50
	Diluted		2.64	2.69	2.49

KEY RATIOS

PARTICULARS		31.03.2012	31.03.2011	31.03.2010
PAT / Total Income	(%)	12.15	14.26	14.95
Net Profit Margin (PBT/Sales)	(%)	15.62	18.18	18.45
Return on Total Assets (PBT/Total Assets}	(%)	26.41	33.24	38.50
Return on Investment (ROI) (PBT/Networth)		0.45	0.54	0.70
Debt Equity Ratio (Total Liability/Networth)		1.16	1.17	1.31
Current Ratio (Current Asset/Current Liability)		1.33	1.26	1.05

LOCAL AGENCY FURTHER INFORMATION

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	Yes
8) No. of employees	Yes
9) Name of person contacted	No
10) Designation of contact person	No
11) Turnover of firm for last three years	Yes
12) Profitability for last three years	Yes
13) Reasons for variation <> 20%	--
14) Estimation for coming financial year	No
15) Capital in the business	Yes
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	--
23) Banking Details	Yes
24) Banking facility details	Yes
25) Conduct of the banking account	--
26) Buyer visit details	--
27) Financials, if provided	Yes
28) Incorporation details, if applicable	Yes
29) Last accounts filed at ROC	Yes
30) Major Shareholders, if available	No

Amalgamation of Fem Care Pharma Ltd with the Company

During the year the Company had acquired from the public shareholders of Fem Care Pharma Limited (FEM) 20% of the equity share capital of FEM, in addition to the controlling stake of 72.15% acquired from its existing promoters thereby increasing the total controlling stake to 92.15%. FEM had become a subsidiary of the company w.e.f. 25th June, 2009. Further, on 26th October, 2009, amalgamation of Fem Care Pharma Limited with the company, with effect from 1st April, 2009, was approved by the board of directors of both the Companies. Amalgamation of FEM with the Company has been completed and has become effective on 18th June, 2010 upon filing of the Order of Hon'ble Delhi and Mumbai High Courts with the respective offices of Registrar of Companies.

Operations

At Dabur, they recognize operations as an important source of competitive advantage. Dabur believes in continually striving for higher and better levels of quality not just in its products, but also in its operations, without losing sight of its commitments towards the environment and communities where it operates. A host of initiatives are continually rolled out by the company to improve productivity while reducing its energy usage.

MANAGEMENT DISCUSSION AND ANALYSIS

The world witnessed fair bit of challenges during fiscal 2011-12 with the deepening debt crisis in Europe, political upheavals in parts of Middle East and rising tensions between Iran and the West. These events had a significant impact on global risk appetite and crude oil prices, though towards the end of the year, there have been liquidity infusions by European central banks and this combined with better than expected recovery in the U.S. have revived global risk appetite and emerging markets such as India may benefit. India also witnessed its share of challenges during fiscal 2011-12 with macro headwinds such as high inflation, currency depreciation and deceleration in GDP growth rates. During the year, the Reserve Bank of India hiked repo rates several times to combat inflation. The high interest rates did not bode too well for industrial production as reflected in the deceleration of IIP and GDP growth. GDP growth rate slowed down from 8.4% in FY11 to 6.9% in FY12. The country was swept by persistent double digit inflation during the year and WPI based inflation remained close to 10% for most part of the year with some moderation during the last 4 months of the fiscal (refer Fig. 2). However, the Reserve Bank of India has reduced repo rates by 50 bps in April 2012. This is expected to improve liquidity and outlook for growth and investments in the economy.

Inspite of these blips, India’s long term growth story continues to remain intact. In fiscal 2011–12, India’s GDP is expected to grow at around 7%, making it one of the faster growing major economies, despite the ongoing challenges. India, which was the tenth largest economy in terms of Purchasing Power Parity (PPP) in 1991, has even overtaken Japan and is now the third largest economy in terms of PPP. As per a recent study by Knight Frank and Citi Private Bank, the North American and Western European share of world real GDP will fall from 41% in 2010 to just 18% in 2050 while, developing Asia’s share is expected to rise from 27% to 49% in 2050. China will overtake the U.S. to become the world’s largest economy by 2020, which in turn will be overtaken by India in 2050.

Therefore, the outlook for India remains positive

This is also supported by GDP growth estimates released by IMF. Real GDP growth in emerging markets such as India and Sub-Saharan Africa is expected to be ahead of World as well as the U.S. and Euro Area during 2013.

FMCG Sector

Consumer sector story in India remains intact and is expected to continue on a secular growth trend driven by favourable demographics, increase in per capita consumption levels and increase in penetration. According to a recent study conducted by Boston Consulting Group (BCG) and Confederation of Indian Industry (CII) titled ‘The Tiger Roars’, there are four powerful socioeconomic and demographic factors driving consumption.

These are:

(i) Increase in household income: the average household income is set to rise nearly 3 times between 2010 and 2020. The income pyramid in India which typically had a wide base of ‘struggler’ households (having per capita income <US$ 3,300) is quickly becoming a diamond, as household incomes of the middle income groups grow.

(ii) Urbanization: By 2020 the percentage of India’s population living in cities will rise to 35% from 31% in 2010. Urban dwellers not only tend to increase their purchases but also spend on different items thereby giving a boost to consumption.

(iii) Nuclear Families: The share of nuclear families has risen from 61% in 2006 to 66% in 2010 and the per capita spending of nuclear families is 20 to 50 per cent higher than traditional joint families.

(iv) Gen I: connotes the generation of Indian spenders who have reached their prime consumption years. Members of Gen I believe in living in the present and have a higher propensity to spend having witnessed first- and the opening of markets, influx of foreign brands and creation of wealth. This generation will be a strong driver of consumption and is expected to reorient the consumer market as deeply as Baby Boomers in the US have for the past five decades

As per this study, the Indian consumer market is poised to grow 3.6 times between 2010 and 2020, faster than most other emerging markets. Estimated at US$ 991 billion in 2010, total consumption expenditure is expected to grow to nearly US$ 3.6 trillion in 2020.

The demographic factors combined with rising per capita disposable incomes are expected to fuel consumption growth in India for a long period of time. Several indicators point in this direction, such as Nielsen’s Global Survey of Consumer Confidence and Spending Intentions, as per which India was the world’s most optimistic market in Q4 CY2011. India has retained this title for eight quarters in a row.

As income levels are rising there is also a clear trend of increase in share of non-food expenditure in both rural and urban India. The relative share of expenditure on non-food items is a strong indicator of economic development and prosperity as with economic well being people tend to spend more on categories other than food.

This is exactly what has happened in India with the share of non-food expenditure increasing from 36.0% in 1987-88 to 46.4% 2009-10 for rural India and from 43.6% to 59.3% in urban India

The Indian FMCG sector, comprising branded food products, personal care, household care, baby care and OTC products was pegged at c. Rs. 1.7 trillion during FY 2011-12. The sector demonstrated its resilience to the economic upheaval and grew by 15.1% in the period January to December 2011. The sector has witnessed a steady growth trend during the last 3 years

Growth in rural India has been continuing on the back of expansion of rural consumers’ wallet driven by factors such as higher Minimum Support Prices (MSPs) for agricultural produce, loan waivers and employment guarantee schemes. MSPs for Paddy and Wheat have grown at a CAGR of 13.2% and 11.4% respectively since 2006- 07. These factors coupled with increase in per capita income in rural and semi urban areas have contributed to strong growth and expansion of rural consumption.

Rural consumers are now increasingly moving towards branded products. Gone are the days when the rural consumer was content with using mustard oil and plain soap on her hair and skin. Today, they are increasingly demanding branded products for their daily personal and health care needs. The rural consumers across income segments are exhibiting marked propensity towards spending on high quality products, which are backed by strong brand values.

Dabur Performance Overview

The year 2011-12 was a landmark year for Dabur as the company surpassed the US$ 1 billion or Rs. 50000.000 Millions turnover mark, making it one of the few companies in India having this distinction. This has been the outcome of the company’s efforts to grow its revenues aggressively both organically and through acquisitions. In fact the company has witnessed the highest growth during the last 10 years as is presented in Fig. 8 which shows the company’s revenues during the last 25 years.

FY2011-12 saw another landmark achievement with the company’s Food business crossing the Rs. 5000.000 Millions mark. This is a creditable achievement for the Food business which has continued to grow at a strong pace and retained leadership in fruit based beverage category through innovation, expansion and creating a huge consumer preference for its brands – Real and Activ.

What makes these achievements even more significant is the fact that they have been achieved in a year that would rank as among the most challenging ever for the industry with a slowing economy, rising input costs, disruptive competition and currency depreciation. The company coped well with these challenges through a mix of strategies and actions such as calibrated price increases and productivity enhancement measures thereby achieving strong growth in revenue and profitability. During the year the company undertook a distribution re-alignment exercise, in which Dabur’s erstwhile strategic business units, Consumer Care Division (CCD) which focused on Healthcare, Home and Personal Care and Foods and Consumer Health Division (CHD) which focused on over-the-counter (OTC) healthcare brands and traditional Ayurvedic medicines were integrated into a unified structure or SBU called Consumer Care Business. There was some impact on offtakes due to this transition during first half of the year. However, the business resumed strong momentum post the integration.

Innovation and new product development has always been a key growth driver at Dabur and they continue to move forward on this track. The year saw Dabur introducing a host of new products and variants, besides entering new product segments to keep up the growth momentum and excitement in the market. Some of the successful new launches during the year include Dabur Almond Hair Oil, mixed fruit flavoured variant of the flagship health supplement brand Dabur Chyawanprash, premium face masks and scrub under Dabur Uveda, a range of professional facial products and body bleach under the brand Fem, and Vatika Hair Gel in their overseas market, to name a few. All of these new launches have been well accepted and have garnered share of both the market pie and the consumer’s mind space.

They believe that with aspirations of rural consumers coming closer to their urban counterparts, just leveraging mainstream media is not sufficient to connect with rural consumers. Companies need to move beyond the traditional media options like radio, television and cinema, and enter into a direct engagement with consumer. These special initiatives not only engage the consumers but also give them an opportunity to touch, feel and experience the products. Be it through participation in haats, nukkad nataks, Kumbh Mela or innovative initiatives like Dabur Amla Banke Dikhao Rani rural beauty pageant, Dabur has very effectively captured the rural consumer mind-space.

In fact, availability of products and consumer connect are the two most important factors in determining a brand’s success in these markets. And Dabur has stepped up its efforts on both counts. Distribution initiatives were undertaken during the year to expand Dabur’s rural footprint. Robust IT-enabled tools were also put in place to effectively capture sales data and improve sales forecasting, besides special consumer connect initiatives rolled out for various brands, all of which helped drive demand and generate growth.

The highlights of the Company’s performance in fiscal 2011-12 on a consolidated basis are:

· Consolidated Sales increased to Rs. 52832.000 Millions in fiscal 2011-12 from Rs 40774.000 Millions in fiscal 2010-11, registering a growth of 29.6%

· Earnings before interest, taxes, depreciation and amortization (EBITDA) increased to Rs. 9476.000 Millions in 2011-12, from Rs. 8334.000 Millions in fiscal 2010-11, registering growth of 13.7%

· Consolidated profits after tax (PAT) went up to Rs. 6449.000 Millions in fiscal 2011-12 from Rs. 5686.00 Millions, going up by 13.4%.

· Earnings per share (EPS) went up to Rs. 3.68 in fiscal 2011-12 from Rs. 3.25 in fiscal 2010-11

Strategic Business Units

In order to meet the changing business requirements and capture greater efficiencies of scale the company has realigned its business structure. The erstwhile strategic business units, Consumer Care Division (CCD) and Consumer Health Division (CHD) have now been integrated into a unified structure or SBU called Consumer Care Business.

Each of these divisions had separate go to market teams and distinct strengths in servicing key channels. With a view to capture greater scale of the unified business and thereby enhance the quality of distribution in key channels, the entire back-end and front-end of both the divisions have been integrated into this unified structure.

This has led to creation of a unified and integrated health care vertical which includes the health supplements and digestives portfolio as well as the OTC and ethical ayurvedic portfolio. This would enhance the company’s position and prospects in healthcare market and channels by virtue of greater scale, focus and optimization of resources.

The realigned business structure now stands as below:

· Consumer Care Business, which incorporates the entire FMCG business of Dabur comprising Health care and Home and Personal care verticals accounts for 56% of the Company’s consolidated revenues

· Foods, consisting of fruit-based beverages and culinary pastes business, contributes 10.1% of total sales

· International Business Division (IBD), which includes Dabur’s organic overseas business as well as the acquired entities, Hobi Group and Namaste Laboratories LLC, accounts for 30.3% of Dabur’s consolidated revenues.

Consumer Care Business

The Consumer Care Business is the largest segment, contributing to 56% of consolidated sales and grew by 11.4% during fiscal 2011-12. The segment is divided into the key verticals of Health care and Home and Personal care.

Health Care

With a legacy and experience of over 127 years, Dabur is today India’s most trusted healthcare brand and the world’s largest Ayurvedic and Natural Health Care Company. Health Care will be one of the important areas of growth for Dabur in the years to come. With the new unified distribution structure in place, Dabur is in a better position to roll out a slew of initiatives that would further deepen its commitment towards the health and well-being of every household. The new initiatives are also well timed to cash in on the growing awareness among Indian consumers about health and wellness and their growing tendency to spend on products that deliver on the holistic and wellness promise. Dabur’s healthcare vertical comprises Health supplements, Digestives, OTC and Ayurvedic ethical products

Health Supplements

There’s a growing awareness today among Indian consumers about health and wellness, and increasingly, people are seeking healthier products. Given the stress and health issues that people in urban India face due to lifestyle related problems, consumers are increasingly turning to holistic and convenient solutions. Dabur is well placed to ride this trend, given its wide portfolio of natural and Ayurvedic health products. Dabur was this year ranked as the Most Trusted Brand in the healthcare category in the Brand Trust Report 2012, which is the most comprehensive list of India’s Most Trusted Brands prepared by Trust Research Advisory.

The three key brands in the Health Supplements portfolio – Dabur Chyawanprash, Dabur Honey and Dabur Glucose are all Billion Rupee Brands i.e. with turnover in excess of a billion rupees. The Company has rolled out a plethora of initiatives this fiscal to drive further growth for each of these brands.

During the year, Dabur expanded the Dabur Chyawanprash franchise with the launch of a Mixed Fruit fl avoured variant. With this, Dabur Chyawanprash now comes in three fruit fl avoured variants. The new variant is packed with 49 Ayurvedic ingredients like Amla, Ashwagandha and Guduchi which build immunity, and will provide the same immunity and health benefits as Dabur Chyawanprash, albeit in a tastier format. The sugar-free variant, Dabur Chyawan Prakash also performed well during the year.

Research suggested that a large number of youth, particularly kids, find the taste of Chyawanprash an entry barrier. The new Chyawanprash variants are expected to bridge the gap between health and taste and bring more consumers into the Chyawanprash category. The variants have met with positive response and the Company is confident that they would go a long way in expanding the consumer base for this 100% natural health tonic.

The Company also rolled out two mega campaigns during the year, aimed at spreading awareness about strengthening immunity to fight a variety of cold, flu and other infections. The campaign was based on a clinical trial study which proved that just two spoonfuls of Dabur Chyawanprash every day can strengthen a person’s immunity by 3 times. This campaign was very well received and helped the brand perform well during the year.

The brand also initiated a strong school contact programme in East India to take forward its highly successful Immune India initiative. A sustained campaign was held to educate consumers about how building immunity would help them protect themselves from various infections. Under this programme, the brand reached out to large number of school kids across East India educating them about the need to build immunity, particularly during the onset of winters. Given the success of this initiative, the Company now plans to roll it out in more states going ahead.

In addition, the brand reached out to consumers through various melas and haats. Dabur Chyawanprash has now built its presence on the online world and a special microsite has been launched to inform consumers about immunity related health issues and benefits of using Chyawanprash. Riding on these initiatives, Dabur Chyawanprash reported double digit growth and today controls around two-thirds of the Chyawanprash category. Dabur Honey, the largest branded honey in India, witnessed strong growths across regions, SKUs and channels during the year largely driven by effective media campaigns. The new campaign – Apne Youth Ki Umar Badhao featuring Shilpa Shetty – sought to further establish the health and fitness benefits of Honey.

Dabur Glucose, however, had a lackluster year due to a weak summer. Dabur introduced a new litchi fl avoured variant for Glucose during the year, which has been well accepted in the market. This adds to their existing portfolio of Orange and Lemon fl avoured Glucose. Besides, Dabur kick-started a campaign in West Bengal, christened Dabur Glucose Energy Super Force which is targeted at school kids. Under this campaign, which reached out to over 1.5 lakh kids in West Bengal, Dabur Glucose conducted special endurance test and physical fitness tests to shortlist 20 school kids who formed part of the Dabur Glucose-D Energy Super Force team. This team will now be their brand ambassadors spreading health awareness in their respective schools. In the coming fiscal, they will be enhancing this activity and take it to a much larger scale to cover the entire East India.

With summers already knocking on their doors, the company has prepared a number of initiatives to drive growth for Dabur Glucose going forward. As part of these the company has signed up two celebrities for endorsing the product and new campaigns featuring them would be launched shortly.

Digestives

The Digestives business at Dabur till last year included only products offered under the master brand Hajmola. Following the business restructuring in 2011-12, a host of digestive brands – like Pudin Hara, Hingoli, Nature Care, Sat Isabgol, Lavan Bhaskar Churan and Triphala Churan -- that were part of the erstwhile Consumer

Health Division have now been transferred to this vertical, making it a holistic digestive business with a wider range of products and formats.

The digestive tablets space continued to be dominated by Hajmola with new flavours, variants and packaging solutions further establishing the brand’s post-meal connect and helping it report strong growth during the year. The Pudina variant of Hajmola tablets, which was launched about two years back, continued to be a big growth driver for Hajmola. The variant range was further expanded this year with the introduction of Hajmola in a saunf flavour. The company is now exploring the feasibility of introducing several other ethnic Indian flavours in Hajmola.

The company has also introduced some packaging changes in Hajmola, including the introduction of a ‘Hafta’ (weekly) pack and a mega campaign was launched to promote the same. Special south-specific media campaigns were also launched, which have helped grow the brand in southern markets.

These sustained initiatives have helped Hajmola establish itself as a ‘tasty and fun digestive’ for post-meal consumption. Hajmola’s huge success can be gauged by the fact that over 2.6 crore Hajmola tablets are consumed in India daily.

Hajmola’s confectionary range – Hajmola Candy – is now firmly back on the growth track. Two new flavours were added to the Hajmola Candy franchise with the introduction of Pudina Chutney variant and Hajmola Mint Masti. This new format offers consumers the freshness of mint along with the digestive properties of Hajmola and is a unique candy developed by their in-house RandD.

With the consolidation of Pudin Hara franchise within the overall digestives vertical, plans are underway to take this brand to the next level. New promotional campaigns featuring a celebrity and new variants will continue to drive growth for Pudin Hara.

Dabur Hingoli and Sat Isabgol, the other digestive brands in this portfolio, performed well during fiscal 2011-12. Sat Isabgol (psyllium husk) was launched this year in new smaller packs of 50 gm, 100 gm and pouches, which filled an existing need gap in the market. The two Churan brands – Triphala and Lavan Bhaskar Churan, which were part of the erstwhile CHD portfolio, have now been added to the digestives category to expand the portfolio and drive growth for the basket of products.

The company is also focusing on initiatives to push faster growth for Nature Care brand which offers solutions for digestive problems. A new Orange-flavoured variant has already been test marketed in West Bengal and the consumer response has been highly encouraging. The new fiscal will see Dabur launching this variant pan-India, besides introducing the same in a sugar-free avatar, targeting the diabetic population.

OTC Products

The newly-carved out OTC portfolio offers a variety of products in sub-segments such as Women’s Health care, Baby Care, Cough and Cold, Rejuvenation, Oils and proprietary products. This vertical now also includes products from the erstwhile Consumer Health Division, besides the baby massage oil brand - Dabur Lal Tail.

With the new distribution network in place, this division is well positioned to tap more growth opportunities in OTC segments and spread awareness about various products under its umbrella and their benefits across the length and breadth of India. New visibility campaigns are also being executed across chemist outlets to maximize reach and awareness for the various OTC brands.

Honitus has been a key growth driver for the category. The Company has, during the year, initiated a brand health study and clinical research on brand Honitus. The research proves that Honitus is as efficacious as allopathic brands yet at the same time it has no harmful side-effects. A new campaign based on this research will shortly be on air for educating consumers regarding the benefits of Honitus.

Dabur’s flagship baby care brand – Dabur Lal Tail – continued to take forward its consumer education and awareness programme across the hinterland with an effective on-ground activation involving Mobile Health Units. The initiative sought to establish the functional benefits and superiority of Dabur Lal Tail over ordinary oil. Under this, the product was sampled with a large number of mothers with newly born babies in Uttar Pradesh and Maharashtra. A specially prepared Baby Box containing Dabur’s baby care range was distributed in the hospitals in Tier-II towns in the two states.

The company also organized mega health camps across Uttar Pradesh, Bihar and Jharkhand to promote the entire range of Dabur’s OTC health care brands. Health camps with free doctor check-ups were organized as part of this initiative, besides sampling of a variety of products among a large base of consumers.

Special visibility campaigns were also launched for Dabur’s key healthcare brands for women - Dashmularishta and Ashokarishta Asavs. This visibility campaign was undertaken across 1,700 outlets and helped the two brands perform well. A sustained campaign and consumer contest was also undertaken for the Company’s energizer brand Shilajit Gold. As part of its effort to provide consumers greater convenience while purchasing the product, Dabur has launched an online shopping portal for Shilajit Gold -- www.daburshilajitgold.com.

During fiscal 2011-12 Dabur announced the acquisition of OTC energizer brand, ‘30-Plus’ from Mumbai-based Ajanta Pharma Limited. 30-Plus is one of the oldest and strongest health care energizer brands in the country and the acquisition was part of Dabur’s strategy to enhance capability in this space. A re-launch with new packaging and communication has been planned going ahead.

Ayurvedic Ethicals

Dabur has a wide range of ethical healthcare products based upon the ancient system of Ayurveda. These medicines are derived from natural ingredients and form part of a holistic healthcare system which focuses on all round well being through natural treatments. Dabur is one of the largest and oldest votaries of Ayurveda and treats this as a very valuable storehouse of its healthcare expertise and knowledge.

The entire classical and Ayurvedic ethical health care portfolio of Dabur was launched in a contemporary avatar a year earlier. The new-look range was promoted through focused activities at Dabur Ayurvedic Centres, in addition to special Health Camps and Vaid (Ayurvedic doctors) meets. The company organized 200 doctor meets and more than 300 direct consumer contact programmes during the year, which helped the category post accelerated growth.

The focus of this range would be on enhancing availability and visibility among the target consumer segments and increase its penetration.

Home and Personal Care

The Home and Personal Care (HPC) vertical within the Consumer Care Business covers key segments of Hair Oils, Shampoos, Skin and Body Care, besides the range of Home Care products like Mosquito Repellents, Air Fresheners and Hard Surface Cleaners. The year gone by saw high competitive intensity in some of these categories. In addition, significant inflation in material costs put severe pressure on margins. Despite the tough market conditions, calibrated price increases along with a combination of sustained media campaigns and consumer contact programmes for its brands helped Dabur post good performance in the Home and Personal Care business.

Hair Care

Dabur’s Hair Care portfolio comprises Hair Oils and Shampoos. The segment grew by 16.0% during fi scal 2011-12 and contributed 30% to Consumer Care Business.

Hair Oils, which is one of Dabur’s largest and oldest personal care businesses, continued to perform well with the key brands, Dabur Amla Hair Oil, Vatika Enriched Coconut Hair Oil and Anmol Coconut Oil, growing well despite the dual pressures of intensified competitive activity and higher raw material prices. The cost pressures were negated by a mix of efficient buying and calibrated price increases.

It was encouraging that despite higher competitive intensity and significant price increases, Dabur’s flagship hair oil brand Dabur Amla Hair Oil continued to grow in double digits. Dabur Amla has truly established itself as the largest and most preferred perfumed hair oil brand in the country with a consumer base of over 35 million users.

The company adopted a two pronged strategy for Dabur Amla, targeting the mustard oil users in the Hindi belt on one hand and communicating the benefit of Amla to new consumers in South India on the other hand. In the rural pockets of Uttar Pradesh, Bihar and Madhya Pradesh, Dabur continued with its highly popular beauty and talent hunt – Dabur Amla Sundar Susheel Yogya Pratiyogita. Under this initiative, women in the villages are educated about the benefi ts of Dabur Amla hair oil over loose mustard hair oil. This initiative also recognizes and rewards young girls for their beauty and talent and has been hugely successful across villages in these three states.

As part of its strategy to enhance presence in South India, Dabur has been conducting focused marketing initiatives specifi cally targeted at the south Indian consumers. During the year, Dabur Amla set a new record by hosting Hyderabad’s longest ever non-stop hair massage session. Christened Dabur Amla Tala Massage Marathon, the non-stop hair massage session lasted for 8 hours with over 300 women participating in the event. The event also offered the brand a platform to educate consumers about the fact that Dabur Amla Hair Oil is proven to make hair blacker than ordinary coconut hair oil. Popular Tamil cine star and Dabur Amla Hair Oil brand ambassador Sneha also graced the occasion.

In addition, Dabur Amla organised a Miss Beautiful Black Hair contest in Chennai. As part of this initiative, a team of Dabur Amla promoters visited 12 prominent colleges and hot spots in Chennai to promote the contest. In all, more than 1,500 girls from Chennai applied to participate in the contest making it one of the biggest beauty initiatives of Chennai in recent times.

Dabur Amla took forward this initiative to other parts of the country in the latter part of the year with a mega model hunt – Asli Amla Star Ki Khoj – which sought to identify the girl with the best hair in each town and offer her a chance to be featured in an advertisement with Dabur Amla Hair Oil brand ambassador Rani Mukherjee. Under this campaign, the Dabur Amla team visited 13 cities in Uttar Pradesh, Punjab, Rajasthan and Madhya Pradesh to hunt for the lady with the most beautiful hair in each town and crown her as the Dabur Asli Amla Star. The initiative was very well received across all cities. Riding on these initiatives, Dabur Amla Hair Oil reported strong double digit growth during the year.

The year 2011-12 also saw Dabur successfully foray into the light hair oil market with the launch of Dabur Almond Hair Oil. The product offers superior nourishment keeping the hair 100% damage free. It has twice the amount of Vitamin E as compared to well known almond hair oils and Almond Protein, which are vital nutrients known for hair health. Dabur Almond Hair Oil is, in fact, the only product in the almond hair oil category with Almond Protein. The brand has clocked good revenues in the first six months of its launch and has met their internal expectations.

Dabur’s flagship coconut hair oil brand Vatika Enriched Coconut Hair Oil also experienced sharp spike in raw material prices. Despite the cost pressures, the brand continued to establish its superiority over plain coconut oil and performed well during the year reporting strong growth. Dabur’s mass market hair oil brand Anmol performed well during the fiscal.

The shampoo business, under the Vatika brand, faced pressure during the early part of the year, hit by a combination of rising input costs and disruptive competition. However, the second half of the fiscal saw the business come back into positive growth territory with uptick in volume sales. Dabur responded to the increased competitive intensity and combated the same with focused marketing activities, which have revived the brand. Enhanced focus on the key variant, Vatika Smooth and Shine shampoo, which has herbs such as henna, green almonds and shikakai, was instrumental in revitalizing the brand. The company is planning to drive growth by focusing on the herbal aspects of the brand and providing strong marketing investments and support to the brand.

Oral Care

The year 2011-12 was another good year for Dabur’s Oral Care portfolio, a business that comprises two key product categories, Toothpaste and Toothpowder. The toothpaste portfolio, riding on strong demand across the three brands, saw its combined volume market share grow to 14.3% (Source: AC Nielsen MAT March 2012) during the year despite stiff competition.

With its strong differentiated positioning, Dabur Red Toothpaste delivered strong performance during the year and has helped the company establish a firm footing in South India in addition to North, East and West. Besides sustained media activity on the brand, Dabur rolled out a mega school contact programme which sought to increase oral hygiene awareness among children across the country. The brand reached out to a huge number of kids under this programme, which educated them about the need for oral hygiene and how Red toothpaste offers complete protection from all dental problems.

Backed by a strong value proposition to consumers and delivering on the key oral care benefits through natural ingredients, brand Babool has emerged as one of the most trusted and preferred entrylevel toothpaste brand for non-dentifrice users who are new entrants into the toothpaste category. Babool is positioned as an economy product and has a strong preference among rural consumers.

Meswak, the third key pillar in Dabur’s toothpaste market strategy, reported strong performance during the year driven by focused media initiatives and endorsement by cine star Bipasha Basu as the brand ambassador. Meswak toothpaste is a premium herbal toothpaste and is scientifically proven to reduce tartar and plaque. The brand provides complete oral care by fighting germs and bacteria to keep gums healthy, preventing tooth decay, eliminating bad breath and ensuring strong teeth.

Lal Dant Manjan, Dabur’s toothpowder brand, performed well reporting moderate growth although the toothpowder category in itself witnessed stagnation. Growth in the brand was driven by rural activation programmes that sought to convert non-dentifrice users to toothpowder.

Home Care

Dabur’s Home Care portfolio continued on a strong growth trajectory, with focused media activity, new products launches and on-ground promotion and consumer-connect programmes. These initiatives helped Dabur develop a larger presence in this evolving yet underpenetrated category.

The air freshener brand Odonil was the star performer of the category during the year. The brand crossed Rs. 1000.000 Millions turnover mark, joining the elite rank of Dabur’s Billion Rupee Brands. Several key innovations were done in products and packaging which led to strong growth in the brand in spite of competition from private label and unorganized sector. The company’s toilet cleaner brand Sanifresh performed well during the year and has now emerged as the second largest player by volume in the category. Focus on the new formulation, which makes it twice better than competition in terms of its cleaning properties has helped the brand grow well in this competitive segment.

The mosquito repellent brand Odomos witnessed some decline during the year as the mosquito menace was relatively low. The brand, however, continued with its aggressive education and community service programmes across markets. A school contact programme was initiated in Chennai, besides a mega community drive conducted across slums in Delhi and Uttar Pradesh, aimed at educating people about the various mosquito-borne diseases and effective prevention against them.

Foods

Dabur’s Foods Business emerged as the star performer of 2011-12 as the category crossed Rs. 5000.000 Millions in sales. This marks a 10-fold jump in its sales in nine years, a big achievement given the fact that this business is driven purely by packaged fruit juices -- a category that was almost nonexistent a decade ago and was pioneered by Dabur. The Foods business at present includes fruit juices and nectars under the brands Réal and Réal Activ and culinary pastes under the brand Hommade.

Packaged juices under the brands Réal and Réal Activ were the key drivers of growth during 2011-12 led by strong demand for new variants like Plum and Apricot under Réal and Pomegranate-Berry, Grape and Fiber enriched juices under Réal Activ. Réal today has the largest fruit juice range in the country and highly differentiated variants that offer not just good taste but specifi c health benefi ts, and these have been driving growth for the brands. Special campaigns have been launched to educate consumers about the benefits of individual fruit ingredients. Riding on this, Réal has more than doubled its base for the pomegranate variant and this has now emerged as the fourth largest fruit juice variant for Dabur.

Réal special occasion gift packs have become hugely successful. Dabur had initially offered these gift packs during Rakhi and Diwali. Based on consumer response and their need for similar packs for other occasions and festivals, Dabur has now extended this range to cover Baisakhi and other regional festivals too. This has not just added excitement around the brand, but also helped Réal post industrybest growths despite the entry of newer players. Basis consumer feedback, one of the popular gift packs – Réal Car Pack (a multi-pack option for 200ml SKUs) – has now been converted into a regular packing option and is available on the shelves all through the year, targeting inhome consumption.

A host of trade and consumer initiatives were launched during the year, and the division participated in popular trade fairs which helped the brands reach out to a large number of consumers to sample the products. Réal also joined hands with Disney for its hit movie franchise ‘Cars’ to reach out to kids with the 200 ml packs. Under this tie-up, specially designed 200 ml packs of Réal were introduced with Cars’ popular characters on the front of the pack. The fiscal also marked the nation-wide launch of India’s first fiberenriched fruit beverage range - Réal Activ Fiber+. The new beverage range contains soluble dietary fiber that helps manage weight, keep digestive system healthy and maintain heart health. Made from 100% fruit juice with no added sugar and no preservatives, Réal Activ Fiber+ is now available in four exciting tasty variants - Multi Fruit (a blend of exotic fruits like Passion Fruit, Apricot, Guava, Orange and Apple); Orange Citrus Punch (a blend of tropical citrus fruits like Orange, Mandarine, Tangerine, Pineapple and Lemon); Banana Strawberry and Green Apple.

During the year the Hommade brand was extended with the launch of Hommade Bhuna Masala, ready to cook paste used for cooking Indian dishes. This is being test marketed in Delhi and Punjab.

Project Double – Rural expansion

Rural India accounts for about 45 to 50% of Dabur’s domestic sales, and is a strong driver of growth, thanks to increase in agricultural incomes and plethora of rural development programmes and initiatives launched by the Government in recent times. These initiatives have led to more employment generation and higher disposable incomes in the pockets of rural consumers, pushing up their aspirations and demand for branded consumer products.

During the year, Dabur kicked off a major initiative – christened Project Double – to significantly increase the rural reach of its brands. Comprehensive benchmarking was done on rural coverage across 10 key states: Uttar Pradesh, Punjab, Rajasthan, Bihar, West Bengal, Assam, Orissa, Maharashtra, Madhya Pradesh and Karnataka, which contribute to around 72% of the rural FMCG potential.

Project Double is aimed at doubling the direct distribution reach in rural markets, customise trade promotions and provide focused servicing through a dedicated sales team in these markets. A new rural model of intensive resource deployment and market activation was piloted in Uttar Pradesh and Maharashtra during the year. Field resources were deployed in deep hinterland in the high-potential districts of these states to establish networks for doubling rural coverage and considerably increase contact frequencies. Mobile phone-based application was provided to the field resources to guide, track and administer their work. Web-enabled information dashboards provided real time visibility of all information.

The pilot initiatives undertaken in Uttar Pradesh and Maharashtra met action standards consistently on all key aspects of resource stability, coverage expansion and revenue realization from new markets. The efforts in increasing rural reach have resulted in greater penetration in rural availability across categories. Following the success of this pilot initiative, the project is now being rolled out across all 10 states. Dabur will continue its rural thrust in the new fiscal too with greater investments being planned for the same.

Retail Business - New U

Dabur operates its specialized beauty retail business under the brand ‘New U’. This business is operated under Dabur’s wholly-owned subsidiary HandB Stores Limited. The stores merchandize a wide range of beauty care products and are located in premium high footfall malls. The store count at the end of fiscal 2011-12 stood at 47, with outlets spread across North and South India. The stores reported good increase in sales as the product range was enhanced and streamlined.

During the year private label products were introduced under the brand ‘New U’ in items such as nail enamels, nail enamel removers, cotton balls etc. and these will be expanded in months to come.

The Company also stepped up its joint marketing initiatives and in-store activations with top vendor partners such as L’Oreal, HUL, Nivea and P and G across stores, which gave the business a strong fillip. Some of the highly successful brand activations undertaken include Makeover Marathon, Festival of Beauty and Gals in the City.

On the people front, the chain has successfully conducted training for all instore staff in a phased manner on customer service skills, selling skills and beauty skills. The year also saw New U introduce the concept of Gift With Purchase (GWP) as an add-on USP. Under this programme, free gifts are offered to all purchases made at the New U stores and the GWP slabs range from Rs. 250 to Rs. 2,000. New U’s Customer Loyalty Program – Advantage U – has also seen a tremendous growth from 4,000 customers in April 2010 to almost 3 lakh customers today. These privileged customers now account for approximately 50% of sales.

Riding on these initiatives the business increased its revenues to Rs. 424.000 Millions in FY2011-12 from Rs. 205.000 Millions in FY2010-11.

CONTINGENT LIABILITIES:

Rs. In Millions

Particular	31.03.2012	31.03.2011
a. Claims against the Company not acknowledged as debts:
In respect of civil suits filed against the Company	77.000	77.200
In respect of claims by employees	4.400	3.000
In respect of excise duty disputes pending with various judicial authorities	761.100	503.500
In respect of Sales Tax under appeal	107.000	120.200
In respect of Income tax under appeal	31.900	94.000
In respect of letters of credit	39.000	17.900
b. Guarantees given:
In respect of Guarantees furnished by the Company	12230.300	9317.200

FIXED ASSETS

Tangibles

· Leasehold Land

· Buildings, Roads and Culverts

· Plant and Machinery

· Computer

· Vehicles

· Furniture and Fixture

· Freehold Land

Intangibles

· Computer Software

· Trade Marks and Patent

AS PER WEBSITE DETAILS

Corporate Profile

Subject is one of India’s leading FMCG Companies with Revenues of US$1 Billion (over Rs 50000.000 Millions) and Market Capitalisation of US$4 Billion (Rs 200000.000 Millions). Building on a legacy of quality and experience of over 127 years, Dabur is today India’s most trusted name and the world’s largest Ayurvedic and Natural Health Care Company. 

Dabur India is also a world leader in Ayurveda with a portfolio of over 250 Herbal/Ayurvedic products. Dabur's FMCG portfolio today includes five flagship brands with distinct brand identities -- Dabur as the master brand for natural healthcare products, Vatika for premium personal care,Hajmola for digestives, Réal for fruit juices and beverages and Fem for fairness bleaches and skin care products.

Dabur today operates in key consumer products categories like Hair Care, Oral Care, Health Care, Skin Care, Home Care and Foods. The company has a wide distribution network, covering over 2.8 million retail outlets with a high penetration in both urban and rural markets.

Dabur's products also have a huge presence in the overseas markets and are today available in over 60 countries across the globe. Its brands are highly popular in the Middle East, SAARC countries, Africa, US, Europe and Russia. Dabur's overseas revenue today accounts for over 30% of the total turnover.

The 125-year-old company, promoted by the Burman family, had started operations in 1884 as an Ayurvedic medicines company. From its humble beginnings in the bylanes of Calcutta, Subject has come a long way today to become one of the biggest Indian-owned consumer goods companies with the largest herbal and natural product portfolio in the world. Overall, Dabur has successfully transformed itself from being a family-run business to become a professionally managed enterprise. What sets Dabur apart from the crowd is its ability to change ahead of others and to always set new standards in corporate governance and innovation.

PRESS REALEASE

Miss India World 2012 Vanya Mishra Seeks Your Secret Dabur Gulabari Beauty Tips To Win Miss World Crown

Friday, June 29, 2012

· Dabur Gulabari Launches Vanya Mishra Ko Banao Miss World campaign

New Delhi, 29th June: It is not every day that a simple girl from a small town gets to live her dream. But Dabur Gulabari made the dream come true for Chandigarh-based Vanya Mishra, Miss India World 2012, the girl selected to represent India at the Miss World 2012 contest to be held in China on 18th August 2012. She was in the national capital today looking for the secret beauty formula of Indian woman that can help her win the coveted Miss World title and crown. Helping her in this quest for secret beauty tips is her favourite natural skin care brand Dabur Gulabari. The Rose-based beauty products brand from the House of Dabur announced the launch of a mega nation-wide campaign “Vanya Mishra Ko Banao Miss World” to gather support and luck for India’s prettiest face.

Speaking about the initiative, Vanya Mishra said: “Thanks to Dabur gulabari, I got a wild card entry to Miss India 2012 finals, which eventually is now giving me the great honour of representing my beloved country India in the Miss World pageant. With this honour also comes a huge responsibility on me to live up to the expectations of millions of my well-wishers. I have already been putting in my best in preparing for the contest. Now I want the millions of women from India to come forward and help me in my effort by sharing with me their secret Dabur Gulabari beauty tips which can help me win the global beauty pageant.” Vanya’s tough journey from the by lanes of Jalandhar without any professional modelling experience to this surreal existence bore fruit after being declared the winner of Dabur Gulabari Miss Rose Glow contest in Jan 2012. This triumph gave her entry to the finals of Miss India contest as a Dabur Gulabari wild card and there has been no looking back since.

Vanya has invited women from across India to send in their special ‘Dabur Gulabari Beauty Tips’. and help her get the Miss World crown back to the country. Women can send their Dabur Gulabari beauty tips by logging onto the facebook page www.facebook.com/daburgulabari or by atwww.dabur.com/en/beauty. The Top Five tips, along with the pictures and names of the senders, will be featured in a leading newspaper and best beauty tips from all regions, selected by Vanya, would be published in the form of a Coffee Table Book  – “Miss India’s Beauty Secrets”, presented by Dabur Gulabari”. The Coffee Table Book will be launched by Vanya Mishra. She would also personally meet and thank the candidates for the Rose Glow beauty tips.

“It has been long since an Indian has won the Miss World crown and the whole country is expecting Vanya to get the crown back to India and break the 12 year long dry spell. Vanya won the wild card entry through the Dabur Gulabari Miss rose glow contest and we are proud that she went on to win Miss India. This campaign will help all her well-wishers to reach out to Vanya, wish her and even be instrumental in her winning the coveted crown. In turn, the well-wishers also stand a chance to gain national fame through this contest and get featured in a Coffee Table Book along with Vanya Mishra,” said Mr. Sanjay Singal, Marketing Head – Skin Care, Dabur India Limited.

About Dabur Gulabari:

Dabur Gulabari is the only personal care brand offering the goodness of rose for skin care. Dabur Gulabari skincare range is packed with natural rose extracts that give you soft, smooth skin that glows like a Rose. Dabur Gulabari skin care range helps maintain moisture balance without leaving your skin oily. Besides protecting the skin from damaging elements and keeping it soft and untouched, natural rose extracts also help remove dryness and dullness giving your skin a rose-like radiance.

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 records 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.55.15
UK Pound	1	Rs.86.30
Euro	1	Rs.67.88

INFORMATION DETAILS

Report Prepared by :

NTH

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	7
PAID-UP CAPITAL	1~10	7
OPERATING SCALE	1~10	8
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	8
--PROFITABILIRY	1~10	8
--LIQUIDITY	1~10	8
--LEVERAGE	1~10	8
--RESERVES	1~10	8
--CREDIT LINES	1~10	7
--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	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		69

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.