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DRAFT RED HERRING PROSPECTUS

Please read Section 60B of the Companies Act, 1956
100% Book Built Offer
The Draft Red Herring Prospectus shall be updated upon filing with the RoC
Dated June 28, 2007

JYOTHY LABORATORIES LIMITED
(We were incorporated as Jyothi Laboratories Private Limited on January 15, 1992. We became a public limited company and our name was changed to Jyothi
Laboratories Limited on October 6, 1995. We further changed our name to Jyothy Laboratories Limited on August 12, 1996. For details of the change in our name
and Registered Office, please refer to the section titled “History and Corporate Structure” on page 63 of this Draft Red Herring Prospectus.)
Registered and Corporate Office: 43, Shivshakti Industrial Estate, Andheri-Kurla Road, Marol, Mumbai 400 059
Company Secretary and Compliance Officer: Mr. M. L. Bansal
Tel: (91 22) 2850 2470; Fax: (91 22) 2850 1734; Email: ipo@jyothy.com; Website: www.jyothylaboratories.com
PUBLIC OFFER OF 4,430,260 EQUITY SHARES OF RS. 5 EACH THROUGH AN OFFER FOR SALE BY THE SELLING SHAREHOLDERS
FOR CASH AT A PRICE OF RS. [Š] PER EQUITY SHARE (INCLUDING A SHARE PREMIUM OF RS. [Š] PER EQUITY SHARE) AGGREGATING
UP TO RS. [Š] MILLION (THE “OFFER”). THE OFFER WOULD CONSTITUTE 30.52% OF THE FULLY DILUTED POST-OFFER PAID-UP
CAPITAL OF JYOTHY LABORATORIES LIMITED (“COMPANY”).
PRICE BAND: RS. [Š] TO RS. [Š] PER EQUITY SHARE OF FACE VALUE RS. 5 EACH
THE FLOOR PRICE IS [Š] TIMES OF THE FACE VALUE AND THE CAP PRICE IS [Š] TIMES OF THE FACE VALUE
In the event that the Price Band is revised, the Bidding Period will be extended for three additional working days after revision of the Price Band subject to the
Bidding Period not exceeding 10 working days. Any revision in the Price Band and the Bidding Period will be widely disseminated by notification to the Bombay
Stock Exchange Limited (the “BSE”) and the National Stock Exchange of India Limited (the “NSE”), by issuing a press release and also by indicating the change on
the websites of the Book Running Lead Managers and the terminals of the Syndicate.
The Offer is being made through the 100% Book Building Process wherein up to 50% of the Offer shall be available for allocation on a proportionate basis to
Qualified Institutional Buyers (“QIBs”), out of which 5% shall be available for allocation on a proportionate basis to Mutual Funds only. The remainder shall be
available for allocation on a proportionate basis to QIBs and Mutual Funds, subject to valid Bids being received from them at or above the Offer Price. Further, at
least 15% of the Offer will be available for allocation on a proportionate basis to Non-Institutional Bidders and at least 35% of the Offer will be available for
allocation on a proportionate basis to Retail Individual Bidders, subject to valid Bids being received at or above the Offer Price.
RISK IN RELATION TO FIRST PUBLIC OFFER
This being the first public offer of Equity Shares of the Company, there has been no formal market for the Equity Shares of the Company. The face value of the Equity
Shares is Rs. 5 each and the Floor Price is [Š] times of the face value and the Cap Price is [Š] times of the face value. The Offer Price (as determined by the Company and
the Selling Shareholders, in consultation with the BRLMs, on the basis of assessment of market demand for the Equity Shares by way of book building) should not be taken
to be indicative of the market price of the Equity Shares after the Equity Shares are listed. No assurance can be given regarding an active and/or sustained trading in the
Equity Shares or regarding the price at which the Equity Shares will be traded after listing. This Offer has been rated by [Š] as [Š] (pronounced [Š]) indicating [Š]. For
details see the section titled “General Information” on page 8 of this Draft Red Herring Prospectus.
GENERAL RISKS
Investments in equity and equity-related securities involve a degree of risk and investors should not invest any funds in this Offer unless they can afford to take
the risk of losing their investment. Investors are advised to read the risk factors carefully before taking an investment decision in this Offer. For taking an investment
decision, investors must rely on their own examination of the Company and the Offer including the risks involved. The Equity Shares offered in the Offer have not
been recommended or approved by the Securities and Exchange Board of India (“SEBI”), nor does SEBI guarantee the accuracy or adequacy of this Draft Red
Herring Prospectus. Specific attention of the investors is invited to the section titled “Risk Factors” beginning on page x of this Draft Red Herring Prospectus.
COMPANY’S ABSOLUTE RESPONSIBILITY
We, having made all reasonable inquiries, accept responsibility for and confirm that this Draft Red Herring Prospectus contains all information with regard to
us and the Offer, which is material in the context of the Offer, that the information contained in this Draft Red Herring Prospectus is true and correct in all material
aspects and is not misleading in any material respect, that the opinions and intentions expressed herein are honestly held and that there are no other facts, the
omission of which makes this Draft Red Herring Prospectus as a whole or any of such information or the expression of any such opinions or intentions misleading in
any material respect.
LISTING ARRANGEMENT
The Equity Shares offered through the Red Herring Prospectus are proposed to be listed on the NSE and BSE. We have received an ‘in-principle’ approval
from the NSE and the BSE for the listing of the Equity Shares pursuant to their letters dated [Š] and [Š], respectively. For the purposes of the Offer, the Designated
Stock Exchange shall be [Š].
BOOK RUNNING LEAD MANAGERS REGISTRAR TO THE OFFER

Kotak Mahindra Capital Company Limited Enam Financial Consultants Private Limited Intime Spectrum Registry Limited
3rd Floor, Bakhtawar 801/802, Dalamal Towers C-13, Pannalal Silk Mills Compound,
229 Nariman Point Nariman Point LBS Marg,
Mumbai 400 021 Mumbai 400 021 Bhandup (West),
Tel: (91 22) 6634 1100 Tel: (91 22) 6638 1800 Mumbai 400 078
Fax: (91 22) 2283 7517 Fax: (91 22) 2284 6824 Tel. : (91 22) 2596 0320
Email: jyothy.ipo@kotak.com Email: jyothy.ipo@enam.com Fax. : (91 22) 2596 0329
Website: www.kotak.com Website: www.enam.com Email: jyothylabs-ipo@intimespectrum.com
Contact Person: Mr. Chandrakant Bhole Contact Person: Mr. Sachin K. Chandiwal Website: www.intimespectrum.com
Contact Person: Mr. Sachin Achar
OFFER PROGRAMME
BID/OFFER OPENS ON: [Š] BID/OFFER CLOSES ON: [Š]

TABLE OF CONTENTS

SECTION I: GENERAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . i
DEFINITIONS AND ABBREVIATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . i
PRESENTATION OF FINANCIAL, INDUSTRY AND MARKET DATA . . . . . . . . . . . . . . . . . . . . . . . . . . viii
FORWARD-LOOKING STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ix
SECTION II: RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . x
SECTION III: INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SUMMARY OF OUR BUSINESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
THE OFFER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SUMMARY FINANCIAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
CAPITAL STRUCTURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
OBJECTS OF THE OFFER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
BASIS FOR OFFER PRICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
STATEMENT OF GENERAL TAX BENEFITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION IV: ABOUT OUR COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
INDUSTRY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
BUSINESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
REGULATIONS AND POLICIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
HISTORY AND CORPORATE STRUCTURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
OUR MANAGEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
OUR PROMOTER AND PROMOTER GROUP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
RELATED PARTY TRANSACTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
DIVIDEND POLICY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
SECTION V: FINANCIAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
SUMMARY OF SIGNIFICANT DIFFERENCES BETWEEN INDIAN GAAP, U.S. GAAP AND IFRS . . 198
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 205
SECTION VI: LEGAL, REGULATORY AND STATUTORY DISCLOSURES . . . . . . . . . . . . . . . . . . 220
OUTSTANDING LITIGATION AND MATERIAL DEVELOPMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . 220
GOVERNMENT APPROVALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 230
OTHER REGULATORY AND STATUTORY DISCLOSURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 246
SECTION VII: OFFER INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 253
TERMS OF THE OFFER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 253
OFFER STRUCTURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 256
OFFER PROCEDURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 259
RESTRICTIONS ON FOREIGN OWNERSHIP OF INDIAN SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . 279
SECTION VIII: MAIN PROVISIONS OF ARTICLES OF ASSOCIATION . . . . . . . . . . . . . . . . . . . . . 280
SECTION XI: MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION . . . . . . . . . . . . . 291
SECTION X: DECLARATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 293

SECTION I: GENERAL
DEFINITIONS AND ABBREVIATIONS

Term Description

“Company”, “We”, “Us”, “Our”, Jyothy Laboratories Limited, a company incorporated under the Companies
“Jyothy” and “JLL” Act, 1956 and having its Registered Office at 43, Shivshakti Industrial
Estate, Andheri-Kurla Road, Marol, Mumbai 400 059, unless the context
indicates or specifies otherwise

Company Related Terms
Term Description

Articles/Articles of Association The Articles of Association of our Company
Auditors Our statutory auditors, M/s S. R. Batliboi & Associates, Chartered
Accountants
Balaji Telebrands Balaji Telebrands Limited, a company incorporated under the laws of India
whose registered office is at Balaji House, C-13,Dalia Industrial Estate, New
Link Road, Andheri West, Mumbai 400 053, which has been set up as part of
the joint venture with Ms. Shoba Kapoor and Ms. Ekta Kapoor.
Board of Directors/Board Our board of directors or a committee of our board of directors
Canzone Canzone Limited, a company incorporated with limited liability under the
laws of Mauritius whose registered office is at 5th Floor, One Cathedral
Square, Jules Koenig Street, Port Louis, Mauritius and who is a Selling
Shareholder for the purposes of the Offer
CDC CDC Investment Holdings Limited, a company incorporated under the laws
of Mauritius whose registered office is located at Les Cascades Building,
Edith Cavell Street, Port Louis, and who is a Selling Shareholder for the
purposes of the Offer
CSPL Continental Speciale (India) Private Limited, a company incorporated under
the laws of India whose registered office is at 7-1-24/2/D, Greendale,
Ameerpet, Hyderabad- 500016, Andhra Pradesh, which has been set up as
part of the joint venture with CCL Products (India) Limited
Directors Our directors, unless the context indicates otherwise
ICICI Bank Canada ICICI Bank Canada, a Schedule II bank under the Bank Act (Canada) whose
principal place of business is at Exchange Tower, Suite 2130, 130 Kings
Street West, P.O. Box 58, Toronto ONM5X 1B1, Canada, and who is a
Selling Shareholder for the purposes of the Offer
ICICI Bank UK ICICI Bank UK PLC, a banking company incorporated under the laws of
England and Wales whose registered office is at 21, Knightsbridge, London
SWIX 7LY, and who is a Selling Shareholder for the purposes of the Offer
Jyothy Laboratories The sole proprietorship firm set up by our Promoter in 1983 that launched
Ujala fabric whitener and which has since ceased business. For further
details, see the section titled “History and Corporate Structure” on page 63 of
this Draft Red Herring Prospectus
Key Management Personnel Those persons described in the section titled “Our Management—Key
Management Personnel” on page 82 of this Draft Red Herring Prospectus
Memorandum/ Memorandum of The Memorandum of Association of our Company
Association
Registered Office 43, Shivshakti Industrial Estate, Andheri-Kurla Road, Marol, Mumbai
400 059
Preference Shares 12% redeemable preference shares in our Company with a face value of Rs.
100 each, all of which were redeemed on March 27, 2002

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Term Description

Promoter Our promoter, Mr. M. P. Ramachandran
Promoter Group The individuals, HUFs, companies, partnership and proprietorship firms
described in the section titled “Our Promoter and Promoter Group—Promoter
Group” beginning on page 85 of this Draft Red Herring Prospectus
SARF South Asia Regional Fund, a company incorporated with limited liability
under the laws of Mauritius and whose registered office is at Les Cascades
Building, Edith Cavell Street, Port Louis, Mauritius, and who is a Selling
Shareholder for the purposes of the Offer
Sri Sai Homecare Our subsidiary, Sri Sai Homecare Products Private Limited, whose registered
office is at Plot No. 47, Phase- I, I.D.A., Jeedimetla, Hyderabad- 500 055,
Andhra Pradesh.

Offer Related Terms
Term Description

Allotment/Allot The transfer of Equity Shares from the escrow account created to hold the
Equity Shares being offered by the Selling Shareholders, to the Allottee
Allottee The successful Bidder to whom Equity Shares have been Allotted
Banker(s) to the Offer [Š]
Bid An indication to make an offer during the Bidding Period by a prospective
investor to subscribe to the Equity Shares of our Company at a price within
the Price Band, including all revisions and modifications thereto
Bid/Offer Closing Date The date after which the Syndicate will not accept any Bids for the Offer,
which shall be notified in an English national daily newspaper, a Hindi
national newspaper and a Marathi newspaper with wide circulation
Bid/Offer Opening Date The date on which the Syndicate shall start accepting Bids for the Offer,
which shall be notified in an English national daily newspaper, a Hindi
national newspaper and a Marathi newspaper with wide circulation
Bid Amount The highest value of the optional Bids indicated in the Bid cum Application
Form and payable by the Bidder on submission of the Bid in the Offer
Bid cum Application Form The form in terms of which the Bidder shall make an offer to purchase Equity
Shares of our Company in terms of the Red Herring Prospectus
Bidder Any prospective investor who makes a Bid pursuant to the terms of the Red
Herring Prospectus and the Bid cum Application Form
Bidding Period/Offer Period The period between the Bid/Offer Opening Date and the Bid/Offer Closing
Date inclusive of both days and during which prospective Bidders can submit
their Bids
Bid Price The highest price at which the optional Bids have been made as indicated in
the Bid cum Application Form
Book Building Process/Method Book building mechanism provided in Chapter XI of the SEBI Guidelines, in
accordance with which this Offer is being made
Book Running Lead Kotak Mahindra Capital Company Limited and Enam Financial Consultants
Managers/BRLMs Private Limited
CAN/Confirmation of The note or advice or intimation of allocation of Equity Shares sent to the
Allocation Note Bidders who have been allocated Equity Shares after discovery of the Offer
Price in accordance with the Book Building Process
Cap Price The higher end of the Price Band, above which the Offer Price will not be
finalized and above which no Bids will be accepted
Cut-off Price The Offer Price finalized by our Company and the Selling Shareholders, in
consultation with the BRLMs, which shall be any price within the Price Band

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Term Description

Designated Date The date on which funds are transferred from the Escrow Account to the
Public Offer Account after the Prospectus is filed with the RoC, following
which the Board of Directors shall give delivery instructions for transfer of
Equity Shares to successful Bidders
Designated Stock Exchange [Š]
Draft Red Herring Prospectus This Draft Red Herring Prospectus issued in accordance with Section 60B of
the Companies Act, which does not contain complete particulars on the price
at which the Equity Shares are offered and the size (in terms of value) of the
Offer
ENAM Enam Financial Consultants Private Limited, a Book Running Lead Manager
for the purposes of this Offer
Equity Shares Equity shares of our Company of Rs. 5 each, unless the context indicates
otherwise
Escrow Account Account opened with the Escrow Collection Bank(s) for the Offer and in
whose favour the Bidder will issue cheques or drafts in respect of the Bid
Amount when submitting a Bid
Escrow Agreement Agreement to be entered into among our Company, the Selling Shareholders,
the Registrar, the BRLMs, the Syndicate Members and the Escrow Collection
Bank(s) for collection of the Bid Amounts and where applicable refunds of the
amounts collected to the Bidders on the terms and conditions thereof
Escrow Collection Bank(s) The banks which are clearing members and registered with SEBI as Banker to
the Offer with whom the Escrow Account will be opened and in this case
being [Š]
First Bidder The Bidder whose name appears first in the Bid cum Application Form or
Revision Form
Floor Price The lower end of the Price Band, above which the Offer Price will be finalized
and below which no Bids will be accepted
KMCC Kotak Mahindra Capital Company Limited, a Book Running Lead Manager
for the purposes of this Offer
Margin Amount The amount paid by the Bidder at the time of submission of the Bid, being
10% to 100% of the Bid Amount
Mutual Fund Portion The portion of the Offer available for allocation to Mutual Funds only, being
5% of the QIB Portion, which is 110,760 Equity Shares
Mutual Funds A mutual fund registered with SEBI under the SEBI (Mutual Funds)
Regulations, 1996, as amended
Non-Institutional Bidders All Bidders that are not QIBs or Retail Individual Bidders and who have Bid
for Equity Shares for an amount more than Rs. 100,000
Non-Institutional Portion The portion of the Offer available for allocation to Non-Institutional Bidders,
which is 664,540 Equity Shares, which may be increased in the event of
under-subscription in the QIB Portion or the Retail Portion
Offer This public offer of 4,430,260 Equity Shares of Rs. 5 each at the Offer Price,
through an Offer for Sale by the Selling Shareholders under the Red Herring
Prospectus and the Prospectus
Offer for Sale The offer of 4,430,260 Equity Shares of Rs. 5 each for sale by the Selling
Shareholders
Offer Price The final price at which Equity Shares will be offered under the Offer in
accordance with the terms of the Red Herring Prospectus. The Offer Price will
be decided by our Company and the Selling Shareholders, in consultation with
the BRLMs, on the Pricing Date

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Term Description

Offer Size 4,430,260 Equity Shares of Rs. 5 each to be offered at the Offer Price of Rs.
[Š] each for cash aggregating up to Rs. [Š] million
Pay-in Date Bid Closing Date or the last date specified in the CAN sent to Bidders, as
applicable
Pay-in-Period With respect to Bidders whose Margin Amount is 100% of the Bid Amount,
the period commencing on the Bid/ Offer Opening Date and extending until
the Bid/Offer Closing Date; and
With respect to Bidders whose Margin Amount is less than 100% of the Bid
Amount, the period commencing on the Bid/ Offer Opening Date and
extending until the closure of the Pay-in Date
Price Band Price range where the minimum price (floor of the price band) is Rs. [Š] and
the maximum price (cap of the price band) is Rs. [Š] and including revisions
to that price band
Pricing Date The date on which our Company and the Selling Shareholders, in consultation
with the BRLMs, finalize the Offer Price
Prospectus The Prospectus to be filed with the RoC in terms of Section 60 of the
Companies Act, containing, inter alia, the Offer Price that is determined at the
end of the Book Building Process and the size of the Offer
Public Offer Account Account opened with the Bankers to the Offer to receive monies from the
Escrow Account on the Designated Date
QIB Margin Amount An amount representing at least 10% of the Bid Amount
QIB Portion The portion of the Offer available for allocation to QIBs, which is up to
2,215,130 Equity Shares, which may be increased in the event of under-
subscription in the Non-Institutional Portion or the Retail Portion
Qualified Institutional Buyers Public financial institutions as specified in Section 4A of the Companies Act,
or QIBs FIIs registered with SEBI, scheduled commercial banks, mutual funds
registered with SEBI, multilateral and bilateral development financial
institutions, venture capital funds registered with SEBI, foreign venture capital
investors registered with SEBI, state industrial development corporations,
insurance companies registered with Insurance Regulatory and Development
Authority, provident funds (subject to applicable law) with minimum corpus
of Rs. 250 million and pension funds with minimum corpus of Rs. 250 million
Refund Account Account opened with an Escrow Collection Bank from which refunds of the
whole or part of the Bid Amount, if any, shall be made
Registrar to the Offer Intime Spectrum Registry Limited
Retail Individual Bidder(s) Individual Bidders (including HUFs and NRIs) who have Bid for Equity
Shares for an amount less than or equal to Rs. 100,000 in any of the bidding
options in the Offer
Retail Portion The portion of the Offer available for allocation to Retail Individual Bidder(s),
which is 1,550,590 Equity Shares, which may be increased in the event of
under-subscription in the QIB Portion or the Non-Institutional Portion
Revision Form The form used by the Bidders to modify the quantity of Equity Shares or the
Bid Price in any of their Bid cum Application Forms or any previous Revision
Form(s)
Red Herring Prospectus/RHP The Red Herring Prospectus that will be filed with RoC in terms of Section
60B of the Companies Act, at least three days before the Bid/Offer Opening
Date
Selling Shareholders Canzone Limited, ICICI Bank Canada, ICICI Bank UK PLC, South Asia
Regional Fund and CDC Investment Holdings Limited
Stock Exchanges The BSE and the NSE

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Direct Credit or RTGS as applicable EPS Earning Per Share FDI Foreign Direct Investment FEMA Foreign Exchange Management Act. the terms on which the Offer will be underwritten Technical and Industry Terms Term Description Dhoop A variety of incense stick FMCG Fast moving consumer goods HDPE High density polyethylene. which we use in packaging MRP Maximum retail price RSP Retail selling price Conventional/General Terms Term Description AGM Annual General Meeting AS Accounting Standards issued by the Institute of Chartered Accountants of India AY Assessment Year BSE Bombay Stock Exchange Limited CAGR Compounded Annual Growth Rate CDSL Central Depository Services (India) Limited Companies Act The Companies Act. Tax. our Company and the Selling Shareholders in relation to the collection of Bids in this Offer Syndicate Members Kotak Securities Limited and Enam Securities Private Limited TRS/Transaction Registration The slip or document issued by the Syndicate to the Bidder as proof of Slip registration of the Bid Underwriters The BRLMs and the Syndicate Members Underwriting Agreement The agreement between the members of the Syndicate. as amended from time to time Depositories Act The Depositories Act. 1996. 2000) registered with SEBI under applicable laws in India Financial Year/FY Period of twelve months ended June 30 of that particular year. unless otherwise stated FIPB Foreign Investment Promotion Board. which sets out.Term Description Syndicate The BRLMs and the Syndicate Members Syndicate Agreement Agreement among the Syndicate. as amended from time to time Depository Participant A depository participant as defined under the Depositories Act. inter alia. NEFT. as amended from time to time Depository A body corporate registered under the SEBI (Depositaries and Participant) Regulations. 1999. 1956. Government of India v . Selling Shareholders and our Company to be entered into on or after the Pricing Date. 1996 EBITDA Earnings Before Interest. as amended from time to time and the regulations framed thereunder FII Foreign Institutional Investor (as defined under Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations. 1996. Depreciation & Amortization ECS Electronic Clearing System EGM Extraordinary General Meeting Electronic Transfer of Funds Refunds through ECS.

as the context requires Person of Indian Origin Shall have the same meaning as is ascribed to such term in the Foreign Exchange Management (Investment in Firm or Proprietary Concern in India) Regulations. is a Person resident outside India. as the context may require m Million NAV Net Asset Value NEFT National Electronic Funds Transfer Non Residents/NR Non-Resident is a Person resident outside India. NRE Account Non-Resident External Account NRI/Non-Resident Indian Non-Resident Indian. sole proprietorship. society or other corporate body owned directly or indirectly to the extent of at least 60% by NRIs.a/P. 2000 NRO Account Non-Resident Ordinary Account NSDL National Securities Depository Limited NSE National Stock Exchange of India Limited OCB/Overseas Corporate Body A company. joint venture. including overseas trusts in which not less than 60% of beneficial interest is irrevocably held by NRIs directly or indirectly as defined under Foreign Exchange Management (Deposit) Regulations.T.A Per Annum PAN Permanent Account Number P/E Ratio Price/Earnings Ratio Person/Persons Any individual. Mumbai 400 002 Rs. or trust or any other entity or organization validly constituted and/or incorporated in the jurisdiction in which it exists and operates. Act The Income Tax Act. 1934. 100 Marine Drive.Term Description FIR First Information Report GDP Gross Domestic Product GIR Number General Index Registry Number Government The Government of India HUF Hindu Undivided Family I. unincorporated association. who is a citizen of India or a Person of Indian origin and shall have the same meaning as ascribed to such term in the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) Regulations. body corporate. as amended from time to time Indian GAAP Generally Accepted Accounting Principles in India MICR Magnetic Ink Character Recognition Listing Agreement The listing agreement between the Company and the BSE and /or the NSE. unincorporated organization. 2000 RBI The Reserve Bank of India Reserve Bank of India Act/RBI The Reserve Bank of India Act. company. partnership. as amended from time to time Act RoC/Registrar of Companies The Registrar of Companies for Maharashtra situated at Everest Building. 2000. corporation. 1961. as defined under FEMA and includes a Non-Resident Indian. limited liability company. partnership. OCBs are not allowed to invest in this Offer p. Indian Rupees vi .

GAAP Generally Accepted Accounting Principles in the United States of America vii . 1992 SEBI Guidelines SEBI (Disclosure and Investor Protection) Guidelines.Term Description RTGS Real Time Gross Settlement SEBI The Securities and Exchange Board of India constituted under the SEBI Act SEBI Act Securities and Exchange Board of India Act. 1985 UIN Unique Identification Number U. as amended. 2000. 2000 issued by SEBI on January 27. including instructions and clarifications issued by SEBI in relation thereto from time to time SICA Sick Industrial Companies (Special Provisions) Act.S.

2004 refer to the fifteen month period from April 1. All references to the nine months ended March 31. viii . Dollars” and “US$” are to the legal currency of the United States of America. These publications typically state that the information contained therein has been obtained from sources believed to be reliable.C. There are significant differences between Indian GAAP and U. all references to “Rupees” and “Rs. 2005 to March 31. 2006 and the nine month period from July 1. Our current financial year commenced on July 1. The extent to which industry and market data used in this Draft Red Herring Prospectus is meaningful depends on the reader’s familiarity with and understanding of the methodologies used in compiling such data. unless stated otherwise. All references to A. Further. Although we believe that the industry data used in the reports is reliable. Nielsen ORG-MARG Private Limited. In this Draft Red Herring Prospectus. We have not attempted to explain those differences or quantify their impact on the financial data included herein. Industry and Market Data Industry and market data used in this Draft Red Herring Prospectus has generally been obtained from industry publications and sources such as A. and we urge you to consult your own advisors regarding such differences and their impact on our financial data. the degree to which the Indian GAAP financial statements included in this Draft Red Herring Prospectus is meaningful is entirely dependent on the reader’s level of familiarity with Indian accounting practices. but their accuracy and completeness are not guaranteed and their reliability cannot be assured. Accordingly. 2006 and ends on June 30.S. GAAP. no investment decision should be made on the basis of such information. Accordingly. Any reliance by persons not familiar with Indian accounting practices on the financial disclosures presented in this Draft Red Herring Prospectus will accordingly be limited. data obtained from A. 2007. All references to a particular financial year are to the twelve month period ending on June 30 of that year. INDUSTRY AND MARKET DATA Financial Data Unless stated otherwise. Nielson and Euromonitor International. 2004. 2007. 2006 and March 31. any discrepancies in a table between the total and the sum of the amounts listed are due to rounding-off. 2007. 2003 to June 30. Currency of Presentation In this Draft Red Herring Prospectus.C. 2007 are to the nine month period from July 1.S.C. Nielsen has been used pursuant to their consent letter dated June 18. All references to the 15 months ended June 30. the financial data in this Draft Red Herring Prospectus is derived from our restated consolidated and unconsolidated financial statements prepared in accordance with Indian GAAP and set out in the section titled “Financial Statements” beginning on page 97 of this Draft Red Herring Prospectus.C.” are to the legal currency of India and all references to “U. respectively. it has not been verified. Nielsen in this Draft Red Herring Prospectus shall mean A. PRESENTATION OF FINANCIAL. 2006 to March 31.

inflation and deflation. For further discussion of factors that could cause our actual results to differ from our expectations. “will continue”. “plan”. the Selling Shareholders. • Any change to the retail environment. and • Our dependence on key personnel. • The monetary and interest policies of India. we and the BRLMs will ensure that investors in India are informed of material developments until such time as the grant of listing and trading permission by the Stock Exchanges. actual future gains or losses could materially differ from those that have been estimated. “goal”. “will likely result”. “project”. • Political and regulatory environment. FORWARD-LOOKING STATEMENTS We have included statements in this Draft Red Herring Prospectus that contain words or phrases such as “will”. growth and expansion plans. “future”. Neither our Company. “will pursue” and similar expressions or variations of such expressions that are forward-looking statements. “expect”. among others: • Dependence on our flagship brand. “anticipate”. “seek to”. “should”. All forward-looking statements are subject to risks. Important factors that could cause actual results to differ materially from our expectations include. “objective”. the Syndicate nor any of their respective affiliates have any obligation to or intend to update or otherwise revise any statements to reflect events or circumstances arising after the date of this document. • Our exposure to market risks. As a result. including actions by our competitors. “intend”. risk disclosures are only estimates and could be materially different from what actually occurs in the future. see the section titled “Risk Factors” beginning on page x of this Draft Red Herring Prospectus. ix . “aim”. By their nature. uncertainties and assumptions that could cause actual results to differ materially from those contemplated by the relevant forward-looking statement. “estimate”. “believe”. “contemplate”. • Our ability to successfully implement our strategy. In accordance with SEBI requirements.

Product quality issues. could be adversely impacted if they are associated with negative publicity. and which may therefore have the ability to spend more aggressively on advertising and marketing and have more flexibility to respond to changing business and economic conditions than us. Notwithstanding. we compete against a number of multi-national manufacturers and marketers. 2006. You should carefully consider all of the information in this Draft Red Herring Prospectus. For the nine months ended March 31. Our dependence over the last three financial years on Ujala has been steadily declining with increasing sales contributions from other products. increased expenditure may not prove successful in maintaining or enhancing our market share and could result in lower profitability. There are several strategies adopted by our competitors to increase their market shares through advertising. In addition. could tarnish the image of the affected brands and may cause consumers to choose other products. quality. we may incur increased credit and other business risks as a result of competing for customers in a highly competitive retail environment. 2007 and the year ended June 30. SECTION II: RISK FACTORS An investment in equity securities involves a high degree of risk. We face significant competition that may adversely affect our competitive position and financial performance. The value of our brands. or allegations of product defects. multi-location operations. respectively. some of which are larger and have substantially greater resources than us. Any decline in the net sales of Ujala or Maxo or any other factor that negatively affects these products may adversely affect our market share. you should read this section in conjunction with the sections entitled “Business” beginning on page 45 of this Draft Red Herring Prospectus and “Management’s Discussion and Analysis of Results of Operations and Financial Conditions” beginning on page 205 of this Draft Red Herring Prospectus as well as the other financial and statistical information contained in this Draft Red Herring Prospectus. our business and financial performance could be adversely affected. Any of the following risks as well as the other risks and uncertainties discussed in this Draft Red Herring Prospectus could have a material adverse effect on our business. 3. 2. 2007 and the year ended June 30. In addition. We depend heavily on our flagship brand Ujala. new product introductions and distribution reach. we may be required to increase expenditure for advertising and promotions. our net sales of Ujala continue to represent substantially all of our operating profit in the nine months ended March 31. including the risks and uncertainties described below. To obtain a complete understanding.42% and 86. primarily Maxo which contributed 38. service. 2006 constituted 86. Any factor adversely affecting this product may negatively impact our profitability. our flagship brand Ujala contributed 42.42% and 49. because of changing government regulations or x . In addition.48% of our net sales. including uncertainties about trade and consumer acceptance. In the event we are unable to keep pace with our current or future competition. which for the nine months ended March 31. among others. 2006.99% of our net sales.63% of our net sales in the nine months ended March 31. Due to inherent risks in the marketplace associated with advertising and new product introductions.76% and 32. before making an investment in our Equity Shares. real or imagined. which could result in the loss of all or part of your investment. Unless otherwise stated in the relevant risk factors set forth below. 2007 and the year ended June 30. Our success in part depends on our ability to maintain the brand image of our existing products and effectively build up brand image for new products and brand extensions. This is particularly relevant for Ujala and Maxo and their extensions. Internal Risk Factors 1. pricing. respectively. and our sales. even when false or unfounded. we are not in a position to specify or quantify the financial or other implications of any of the risks mentioned herein. 2007 and the year ended June 30. respectively. In order to protect our existing market share or capture market share in this highly competitive retail environment. 2006. We operate in a competitive retail environment in India. and to introduce and establish new products. the contribution of Maxo. financial condition and results of operations and could cause the trading price of our Equity Shares to decline. channel discounts. business and financial performance.

we may be required from time to time to recall products entirely or from specific markets. or that we may be able to meet the expectations of our targeted customers. through these means. packaging material or attempt to create look-alike products. as well as the development of new businesses. 7. which could have a material adverse effect on our business. results of operations and financial condition. This could reduce our market share due to replacement of demand for our products. as well as the possibility of unexpected consequences. financial and internal controls. including spurious or counterfeit products. certain entities could imitate our brand name. The availability of spurious. We may not be successful in implementing our business strategies. Continuous expansion increases the challenges xi . • we may experience a decrease in sales of certain of our existing products as a result of the introduction of related new products. allegations of product contamination or lack of consumer interest in certain products. could lead to losses in revenues and harm the reputation of our products. whereby we may not be able to recover our initial development costs or may experience a loss in revenues. Our inability to manage growth could disrupt our business and reduce our profitability. look-alike. and • we may experience delays or other difficulties impacting our ability. A principal component of our strategy is to continue to grow by expanding the size and geographical scope of our existing businesses. counterfeit products and the time and cost of defending claims and responding to complaints about spurious products could have a material adverse effect on our reputation. financial and other resources. • sales of the new products to our retail customers may not be as high as we anticipate for a number of factors including product pricing. including those arising from concerns regarding quality. to manufacture or distribute products in a timely manner in connection with launching the new product initiatives. and could also harm the reputation of our brands. • our marketing strategies for the new products may be less effective than planned and may fail to effectively reach the targeted consumer base or produce the desired consumption and the rate of purchases by our consumers may not be as high as we anticipate. Each of the risks referred to above could cause. Any negative publicity regarding us. For example. or the ability of our third party manufacturers and suppliers. results of operations and financial condition. It will require us to continuously develop and improve our operational. business.implementation thereof. financial condition and results of operations. including: • the acceptance of the new product initiatives by our retail customers may not be as high as we anticipate. • we may incur significant advertising and promotion costs in respect of new products. We have identified new product introductions in our selected business segments as one of the avenues for growth. Each of the elements of the new product initiatives carries significant risks. there is no guarantee that we can implement the same on time and within the estimated budget. 4. The proliferation of spurious. Even if we have successfully executed our business strategies in the past. The success of our business may depend substantially on our ability to implement our business strategies effectively. delay or impede our ability to achieve our growth objectives. or we may not be successful in achieving our growth objectives at all. look-alike. The launch of new products that prove to be unsuccessful could impact our growth plans and may adversely impact earnings. or any other event affecting product or service quality. We are exposed to the risk that entities in India and elsewhere could pass off their products as ours. counterfeit products primarily in our domestic market. 6. 5. our brands or our products. This growth strategy may place significant demands on our management. could adversely affect our reputation. • we may incur costs exceeding our expectations as a result of the continued development and launch of the new products.

it is expected that we will become increasingly reliant on supermarket and hypermarket chains for sales. We are heavily dependent on our brands and their brand equity. We may not be able to identify or conclude appropriate or viable acquisitions in a timely manner. Jyothy Laboratories. regardless of their outcome. although we believe that we do not infringe upon the intellectual property rights of others and that we have all the rights necessary to use the intellectual property employed in our business. xii . which may adversely impact our margins. and we have applied for the transfer of registration in the name of our Company but the certificate showing the change in ownership has not yet been received. training and retaining high quality human resources. especially in the larger cities. could result in substantial costs to us and divert management’s attention from our operations and require us to pay damages as well as cease operations using the intellectual property. some of our intellectual property rights are registered in the name of our Promoter and his sole proprietorship firm. 9. In addition. Any inability on our part to manage such growth could disrupt our business prospects. there can be no guarantee that we will be able to obtain registration in respect of trademarks for which our applications are pending. Additionally. and changes in those preferences. preserving our culture. We have identified acquisitions as one of the avenues for our growth and have recently undertaken the acquisition of fabric whitener brands called “Ruby Liquid Blue” and “More Light”. Failure to successfully identify and conclude acquisitions or manage the integration of the businesses acquired or the performance of such businesses being below expectations may cause profitability and operations to suffer. the trade margins/discounts expected by supermarket chains is higher than traditional retail outlets. 1999 in our name. we may be required to litigate to protect our brands. Assertion of such claims against us could result in litigation. 10. Any such claims. impact our financial condition and adversely affect our results of operations. In respect of our unregistered trademarks. While the current share of our revenues through these chains is not significant. For further information. infringement claims will not be asserted against us in the future. the introduction of new products by our competitors or existing alternatives becoming affordable could put our products at a competitive disadvantage. 11. we have not yet obtained overseas trademark registration for some of our brands. recruitment. In addition. These difficulties could disrupt our ongoing business. If we fail to keep pace with the rapid changes in the industry and market it may result in a decline in demand for our products and a decline in sales. the acquisitions may not necessarily contribute to our profitability and may divert management attention or require us to assume debt or contingent liabilities. which would result in a decline in our sales. Any delay in our reactions to changes in market conditions may affect the competitiveness of our products. India has witnessed the emergence of new supermarket and hypermarket chains in the recent past. We intend to make acquisitions in the future as part of our strategy in India. we will have to increase the marketing of our products through this channel and possibly at lower margins.involved in financial management. Further. Further. In addition. we may not be able to prevent infringement of our trademarks and a passing off action may not provide sufficient protection. thereby reducing our market share. We are vulnerable to reduced consumer demand for our products due to changes in consumer preferences. whether founded or not. under which we sell products abroad. which may adversely affect our business operations. 8. Customer preferences in this market may be difficult to predict. The markets in which we operate are characterised by rapid change and frequent new product introductions. Growing penetration of emerging retail formats such as supermarket and hypermarket chains in India may adversely impact our margins. we may experience difficulty in integrating operations and harmonizing cultures leading to a non- realisation of anticipated synergies or efficiencies from such acquisitions. and developing and improving our internal administrative infrastructure. In general. Further. We are heavily dependent on our brands and their brand equity and the intellectual property rights related to our brands. there can be no assurance that we have not inadvertently infringed a third party’s intellectual property rights or that. The brands that we presently use in our business have been registered in India under the Trade Marks Act. values and entrepreneurial environment. see the section entitled “Government Approvals” beginning on page 230 of this Draft Red Herring Prospectus. With the growth in these retail formats in India.

12. We depend heavily on our channel partners such as distributors and retailers and failure to manage the
distribution network efficiently may adversely affect our performance.
We have developed a strong network of distributors and retailers. We are dependent on these channel
partners for the distribution of our products. While relationships with them have been good, we have no standing
contracts with any of these channel partners and most of these distributors and retailers function independently.
Many of our distributors and channel partners also distribute products of our competitors. There can be no
assurance that we will be successful in continuing to receive uninterrupted, high quality service from these
channel partners for all our current and future products.

13. Our business is dependant on our manufacturing facilities and the loss of or shutdown of operations of
any of these facilities could adversely affect our business.
Our own and outsourced production are subject to operating risks, such as the breakdown or failure of
equipment, power supply or processes, performance below expected levels of output or efficiency, labour
disputes, natural disasters, industrial accidents and the need to comply with the directives of relevant government
authorities. Any significant operational problems, the loss of one or more of our facilities or a shutdown of one or
more of our facilities for an extended period of time could adversely affect our business, results of operation and
financial condition.

14. Shortfall in supply of input materials may affect our business and financial performance and price
increases would increase operating costs and may reduce profits.
Substantially all our raw materials are purchased from third parties. We do not have any long-term supply
contracts with respect to raw material used in the manufacture of our products. Raw materials are subject to price
volatility caused by factors including commodity market fluctuations, the quality and availability of supply,
currency fluctuations, consumer demand and changes in governmental agricultural programs. Raw material price
increases result in corresponding increases in our raw material costs. The supply of insecticides used to
manufacture mosquito coils is heavily regulated. We use a single supplier to obtain the chemicals and very few
suppliers have the requisite permission to supply them in India. If these suppliers are, temporarily or
permanently, unable to supply us with these raw materials, our business would be adversely affected.

We rely on the adequate and timely availability of key input materials. Any significant change in the cost
structure or disruption in supply may affect the pricing and supply of products. If we are not able to increase our
product prices to significantly offset increased raw material costs, or if unit volume sales are significantly
reduced, it could have a negative impact on our profitability. This may adversely affect our business and
financial performance.

15. As a manufacturing business, our success depends on the continuous supply and transportation of our
products from our manufacturing units to our distributors and customers, which are subject to various
uncertainties and risks.
We depend on trucking (domestically) and sea borne freight (for exports) to deliver our products from our
manufacturing facilities to our distributors and customers. We rely on third parties to provide such services.
Disruptions of transportation services because of weather-related problems, strikes, inadequacies in the road
infrastructure and port facilities, or other events could impair our procurement of raw materials and our ability to
supply our products to our customers. Any such disruptions could materially and adversely affect our business,
financial condition and results of operations. In addition, transportation costs may increase in particular due to
rising oil and gas prices. Any material increase in transportation costs may adversely impact our margins as we
may not be able to increase our prices to fully recover these costs increases.

16. We are dependent in part on production we outsource to third parties.
For the nine months ended March 31, 2007 and the year ended June 30, 2006, approximately 38.45% and
36.58% of our net sales, respectively, were from sales of our Maxo Maya and Exo Safai products that were
produced by third parties. We manufacture the remainder of our products. Production at our outsourced facilities
is beyond our control and any significant loss or disruption of production from our third party manufacturers for
any reason could adversely affect our business, results of operation and financial condition.

17. Our success depends on our management team and an inability to retain and attract talented staff may
adversely affect our business.
Our success is substantially dependent on the expertise and services of our management team. The loss of
the services of key personnel may have an adverse effect on our business, financial condition and results of

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operations. Further, an increase in the rate of attrition of experienced employees would adversely affect our
ability to implement our business strategies. We operate in a highly dynamic industry and there can be no
assurance that we will be successful in recruiting and retaining a sufficient number of personnel with requisite
skills to replace those personnel who leave. Further, our inability to attract and retain fresh talent could also
hamper our ability to grow.

18. We may face labour disruptions that would interfere with our operations.
We are exposed to the risk of strikes and other industrial actions. As April 30, 2007, we employed over
3,500 full-time employees. Further, as on April 30, 2007, 470 of our employees were members of unions and we
have entered into wage settlement agreements with them. If we were unable to renew those wage settlement
agreements or negotiate favorable terms, we could experience a material adverse affect on our business. While
we believe our relationship with our employees is currently good, we could experience strike, work stoppage or
other industrial action in the future. Any such strike, work stoppage or industrial action by our own employees or
the employees of our suppliers, transportation providers or manufacturers could disrupt our operations, possibly
for a significant period of time, result in increased wages and other costs and otherwise have a material adverse
effect on our business, results of operations or financial condition.

19. We rely on our information technology systems in managing our supply chain, production process,
logistics and other integral parts of our business.
Information technology systems are important to our business. We are heavily reliant on our information
technology systems in connection with order booking, procurement of raw materials, accounting, production,
distribution and our disaster recovery systems. Any failure in our information technology systems could result in
business interruption, adversely impacting our reputation and weakening of our competitive position and could
have a material adverse effect on our financial condition and results of operations.

20. Sales of our Maxo mosquito coils are seasonal.
Sales of our Maxo mosquito coils are seasonal with a substantial part of our revenues from this product
typically coming in the months of January to April and August and September. During periods of lower sales
activity, we may continue to incur operating expenses, but our revenues may be delayed or reduced. This may
adversely impact our results of operations during certain reporting periods.

21. We incurred a net loss in financial year 2004.
In financial year 2004, we incurred a net loss of Rs. 230.82 million. During financial year 2004, we incurred
substantial advertising, publicity and promotion costs in respect of our national launch of our Maxo and Jeeva
products and the under-performance of our Jeeva brand in the market. For further information, see
“Management’s Discussion and Analysis of Results of Operations and Financial Conditions” beginning on page
205 of this Draft Red Herring Prospectus.

22. We face the risk of potential liabilities from lawsuits or claims by consumers.
We face the risk of legal proceedings and claims being brought against us by various entities including
consumers and government agencies for various reasons including for defective products sold. Responding to
complaints and dealing with claims takes time and can divert management’s attention away from our operations.
If some or all of these lawsuits or claims succeed it could adversely affect our business and financial
performance. This may result in liabilities and/or financial claims against us as well as loss of business and
reputation.

23. Our Promoter and Promoter Group will exercise significant control on us and may continue to do so as
long as they own a majority of the Equity Shares, and the other shareholders may be unable to affect the
outcome of shareholder voting during such time.
As at March 31, 2007 our Promoter and promoter group own 69.48% of our paid-up share capital and after
completion of the Offer will continue to hold significant shareholding in us. So long as our Promoter and
promoter group own a majority of the Equity Shares, they will be able to elect the entire Board of Directors and
remove any director, by way of a resolution approved by a simple majority of shareholders in a general meeting.
Our Promoter and promoter group will be able to control most matters affecting us, including the appointment
and removal of officers; business strategy and policies; any determinations with respect to mergers, business

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combinations and acquisitions or dispositions of assets; dividend payout; and capital structure and financing.
Further, the extent of Promoter and promoter group shareholding may result in delay or prevention of a change of
management or control of the Company, even if such a transaction may be beneficial to the other shareholders.

24. Regulatory changes may adversely affect our performance or financial conditions.
Regulatory changes relating to business segments in which we operate in India and overseas, including tax
incentives that are available to us, can have a bearing on our business. Each state in India has different local taxes
and levies which may include sales tax and octroi. Further, changes in these local taxes and levies may impact
our profits and profitability. Any negative changes in the regulatory conditions in India or our other geographic
markets could adversely affect our business operations or financial conditions.

25. Compliance with, and changes in, safety, health and environmental laws and regulations may adversely
affect our results of operations and financial condition.
As a company engaged in the manufacture of fabric whitener, mosquito repellant and skin care products, we
are subject to a broad range of safety, health and environmental laws and regulations in the jurisdictions in which
we operate. For instance, our production facilities located in India and the disposal and storage of raw materials,
chemicals and wastewater from such production facilities are subject to Indian laws and Government regulations
on safety, health and environmental protection. All these laws and regulations impose controls on our noise
emissions, air and water discharges, on the storage, handling, discharge and disposal of chemicals, employee
exposure to hazardous substances and other aspects of our operations and products. While we believe we are in
compliance in all material respects with all applicable safety, health and environmental laws and regulations, the
discharge of our raw materials that are chemical in nature or of other hazardous substances or other pollutants
into the air, soil or water may nevertheless cause us to be liable to the Government of India or the State
Governments where we operate or to third parties. In addition, we may be required to incur costs to remedy the
damage caused by such discharges, pay fines or other penalties or close down the production facilities for non-
compliance.

26. Most of our manufacturing facilities are uninsured and our insurance coverage may not adequately
protect us against possible risk of loss.
Most of our manufacturing facilities are uninsured. We maintain insurance for certain risks including
insurance against standard fire and shock in respect of two manufacturing locations which covers loss and
damage due to fire. These insurance policies do not cover all risks and are subject to exclusions and deductibles.
If any or all of our production facilities are damaged in whole or in part and our operations are interrupted for a
sustained period, we may not be adequately insured to cover the losses that may be incurred as a result of such
interruption or the costs of repairing or replacing the damaged facilities. If we suffer a large uninsured loss or any
insured loss suffered by us significantly exceeds our insurance coverage, our business, financial condition and
results of operations may be materially and adversely affected. See the section titled “Business—Insurance” on
page 56 of this Draft Red Herring Prospectus.

27. We have entered into, and may continue to enter into, related party transactions.
We have in the course of our business entered into transactions with related parties that include our
Promoter and companies forming part of our promoter group. We have also acquired selected assets and
liabilities from certain of our promoter group companies. For more information regarding our related party
transactions, see the section titled “Related Party Transactions” on page 94 of this Draft Red Herring Prospectus.
Further, our business is expected to involve transactions with such related parties, in the future.

28. We require certain approvals or licenses in the ordinary course of business, and the failure to obtain and
retain them in a timely manner or at all may adversely affect our operations.
We require certain approvals, licenses, registrations and permissions for operating our business, some of
which have expired and for which we may have either made or are in the process of making an application for
obtaining the approval or its renewal. For further information, please see the section titled “Government
Approvals” beginning on page 230 of this Draft Red Herring Prospectus. If we fail to obtain or retain any of
these approvals or licenses, or renewals thereof, in a timely manner, or at all, our business may be adversely
affected. Furthermore, some of our government approvals or licenses may be subject to onerous conditions and
require us to make substantial expenditure. If we fail to comply or a regulator claims we have not complied with
these conditions, our business, prospects, financial condition and results of operations would be materially
adversely affected.

xv

29. We will not receive any proceeds from this Offer
This Offer is being made by the Selling Shareholders and there is no fresh issue by the Company.
Accordingly, the funds raised by the sale of our Equity Shares in this Offer will not come to our Company. The
primary objects of the Offer are to achieve the benefits of listing of our Equity Shares and carry out the
divestment of Equity Shares by the Selling Shareholders. We shall bear costs in relation to the listing fees for our
Equity Shares, and we will not receive any proceeds from the sale of the Equity Shares by the Selling
Shareholders. All costs and expenses related to the Offer shall be borne by the Selling Shareholders.

30. Additional issuances of Equity Shares may dilute your holdings and any future sale of Equity Shares by
our Promoter may adversely affect the market price of our Equity Shares.
Any future issuance of our Equity Shares may dilute the positions of investors in our Equity Shares, which
could adversely affect the market price of our Equity Shares. Additionally, sales of a large number of our Equity
Shares by our Promoter or by any other future principal shareholder could adversely affect the market price of
our Equity Shares. The perception that any such primary or secondary sale may occur could also adversely affect
the market price of our Equity Shares.

31. Income tax and other tax exemptions may not be available in future and will affect our post-tax profits
Certain tax deductions are available to us in various states including the states of Assam, Himachal Pradesh,
Kerala, West Bengal, Uttaranchal (Uttarakhand), Jammu and Kashmir and the union territory of Pondicherry
under the Income Tax Act, 1961 (the “Income Tax Act”). Under section 80- IB, the amount of deduction in the
case of an industrial undertaking set up in an industrial backward state, is 100 % of the profits and gains derived
from such industrial undertaking for the first five assessment years and 30 % for the next five years if the
undertaking is owned by a company. There can be no assurance that similar tax benefits will be available to us in
future. When our tax benefits expire or terminate, our tax expense could materially increase, reducing our
profitability.

32. There are outstanding litigations against us, our directors, our Promoter and members of our Promoter
Group
We, our Directors, our Promoter and members of our Promoter Group are party to various legal proceedings
that are pending at different levels of adjudication and before various courts. There are four civil and trademark
cases pending against our Company involving claims, where quantifiable aggregating approximately Rs. 80,850.
Our Company has filed six criminal cases that are currently pending. There are 10 excise tax cases, two income
tax cases and 11 sales tax cases involving the Company. The aggregate amount involved in these cases is Rs.
126,506,896.

No assurances can be given that these matters will be settled in our favour or that no further liability will
arise from them. Any adverse orders that may be passed in any such ongoing or potential litigation could impact
our operations or profitability. Furthermore, should any new developments arise, such as a change in Indian law
or rulings against us by appellate courts or tribunals, we may need to make provisions in our financial statements,
which could increase our expenses and our current liabilities. There can be no assurance that the provisions we
have made for litigation will be sufficient or that further substantial litigation will not be brought against us in the
future.

For further details on the above matters, see the section entitled “Outstanding Litigation and Material
Developments” on page 220 of this Draft Red Herring Prospectus.

33. We have contingent liabilities, which may adversely affect our financial condition.
As of March 31 2007, the contingent liabilities appearing in our restated unconsolidated financial statements
are as follows:
Particulars Amount
Rs. million
Claims against the Company not acknowledged as debt . . . . . . . . . . . . . . . . . . . . 12.00
Guarantees given by the Company to banks 3.00
Tax Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39.23
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54.23

xvi

34. Some of our Promoter Group entities are engaged in the distribution of our products and may engage in
business activities similar to ours and this could be a potential source of conflict of interest.
Some of our Promoter Group entities are engaged in the distribution of our products and may engage in
business activities similar to those undertaken by our Company and this could be a potential source of conflict of
interest. For example, a number of our distributors in southern India are owned or controlled by Promoter Group
entities. While we have not in the past faced any actual conflict, we cannot assure you that no such conflict will
arise in the future that may affect our financial conditions and prospects. Further, we cannot assure you that if
any actual conflict of interest does arise, we will be able to resolve the conflict of interest in our favour.

External Risk Factors
We are an Indian company and all of our assets and customers are located in India. Consequently, our
financial performance will be influenced by political, social and economic developments in India and in
particular by the policies of the Government.

36. A slowdown in economic growth in India could adversely impact our business.
Our performance and the quality and growth of our assets are necessarily dependent on the health of the
overall Indian economy India’s economy could be adversely affected by a general rise in interest rates, weather
conditions adversely affecting agriculture, commodity and energy prices, protectionist efforts in other countries
or various other factors. In addition, the Indian economy is in a state of transition. The share of the services
sector of the economy is rising while that of the industrial, manufacturing and agricultural sectors is declining. It
is difficult to gauge the impact of these fundamental economic changes on our business. Any slowdown in the
Indian economy, or future volatility in global commodity prices, could adversely affect our business.

37. Political instability or changes in the government could delay the liberalization of the Indian economy and
adversely affect economic conditions in India generally, which could impact our financial results and
prospects.
Since 1991, successive Indian governments have pursued policies of economic liberalization, including
significantly relaxing restrictions on the private sector. Nevertheless, the role of the Indian central and state
governments in the Indian economy as producers, consumers and regulators has remained significant. The
leadership of India has changed many times since 1996. The current central government, which came to power in
May 2004, is headed by the Indian National Congress and is a coalition of several political parties. Although, the
current government has announced policies and taken initiatives that support the economic liberalization policies
that have been pursued by previous governments, the rate of economic liberalization could change, and specific
laws and policies affecting banking and finance companies, foreign investment and other matters affecting
investment in our securities could change as well. Any major change in government policies due to coalition
constraint might affect the growth of Indian economy and thereby our growth prospects.

38. Terrorist attacks, civil unrest and other acts of violence or war involving India and other countries could
adversely affect the financial markets and our business.
Terrorist attacks and other acts of violence or war may negatively affect the Indian markets on which our
Equity Shares trade and also adversely affect the worldwide financial markets. These acts may also result in a
loss of business confidence, make travel and other services more difficult and ultimately adversely affect our
business. In addition, any deterioration in relations between India and Pakistan might result in investor concern
about stability in the region, which could adversely affect the price of our Equity Shares. India has also witnessed
civil disturbances in recent years and it is possible that future civil unrest as well as other adverse social,
economic and political events in India could have a negative impact on us. Such incidents could also create a
greater perception that investment in Indian companies involves a higher degree of risk and could have an
adverse impact on our business and the price of our Equity Shares.

39. Natural calamities could have a negative impact on the Indian economy and cause our business to suffer.
India has experienced natural calamities such as earthquakes, tsunami, floods and drought in the past few
years. The extent and severity of these natural disasters determines their impact on the Indian economy. For
example, as a result of drought conditions in the country during fiscal 2003, the agricultural and allied sector
recorded a negative growth of 6.9%. The erratic progress of the monsoon in 2004 affected sowing operations for
certain crops. Furthermore, prolonged spells of below normal rainfall or other natural calamities could have a
negative impact on the Indian economy, adversely affecting our business and the price of our Equity Shares.

xvii

40. After this Offer, the price of Equity Shares may be highly volatile, or an active trading market for the
Equity Shares may not develop.
The prices of the Equity Shares on the Stock Exchanges may fluctuate after this Offer as a result of several
factors, including: volatility in the Indian and global securities market; our operations and performance;
performance of our competitors; the perception in the market with respect to investments in the FMCG sector;
adverse media reports about us or the Indian FMCG sector; changes in the estimates of our performance or
recommendations by financial analysts; significant developments in India’s economic liberalisation and
deregulation policies; and significant developments in India’s fiscal regulations. There has been no public market
for the Equity Shares and the prices of the Equity Shares may fluctuate after this Issue. There can be no assurance
that an active trading market for the Equity Shares will develop or be sustained after this Issue, or that the prices
at which the Equity Shares are initially traded will correspond to the prices at which the Equity Shares will trade
in the market subsequent to this Offer.

41. You will not be able to immediately sell any of the Equity Shares you purchase in this Offer on the Stock
Exchanges.
Under the SEBI Guidelines, we are permitted to allot equity shares within 15 days of the closure of the
public offer. Consequently, the Equity Shares you purchase in this Offer may not be credited to your book or
demat account with Depository Participants within 15 days of the closure of the Offer. You can start trading in
the Equity Shares only after they have been credited to your demat account and listing and trading permissions
are received from the Stock Exchanges.

Furthermore, there can be no assurance that the Equity Shares allocated to you will be credited to your
demat account, or that trading in Equity Shares will commence within the specified time periods.

42. There is no guarantee that the Equity Shares will be listed on the BSE and the NSE in a timely manner or
at all, and any trading closures at the BSE and the NSE may adversely affect the trading price of our Equity
Shares.
In accordance with Indian law and practice, permission for listing of the Equity Shares will not be granted
until after those Equity Shares have been allocated to investors. Approval will require all other relevant
documents authorizing the allocation of Equity Shares to be submitted. There could be a failure or delay in listing
the Equity Shares on the BSE and the NSE. Any failure or delay in obtaining the approval would restrict your
ability to dispose of your Equity Shares.

The regulation and monitoring of Indian securities markets and the activities of investors, brokers and other
participants differ, in some cases significantly, from those in Europe and the U.S. The BSE and the NSE have in
the past experienced problems, including temporary exchange closures. A closure of, or trading stoppage on,
either of the BSE and the NSE could adversely affect the trading price of the Equity Shares.

xviii

see the section titled “Capital Structure—Notes to Capital Structure” on page 15 of this Draft Red Herring Prospectus. The Offer would constitute 30.24 million as of March 31. 84. respectively. Before making an investment decision in respect of this Offer. 2007. allocation shall be on a proportionate basis. you are advised to refer to the section “Basis for Offer Price” on page 23 of this Draft Red Herring Prospectus. The average cost of acquisition of our Equity Shares by our Promoter was Rs. We have entered into related party transactions. 5. 5 per Equity Share. the net asset value per Equity Share. we have not issued any Equity Shares for consideration other than cash. 3. In the event of over-subscription in any of the investor categories. The BRLMs are obliged to provide the same to you. 10. “Our Promoter and Promoter Group” and “Related Party Transactions” on pages 74. 7. 4. We and the BRLMs are obliged to keep this Draft Red Herring Prospectus updated and inform the public of any material change/development until listing.52% of the fully diluted post-Offer paid-up capital of our Company. 2.430.87 per Equity Shares with face value of Rs. Save as disclosed in the sections titled “Our Management”. 6. 8. the Selling Shareholders and the BRLMs. [Š] million. For further information.829. none of our Directors or Key Management Personnel are interested in our Company. 389. see the section titled “Offer Procedure—Basis of Allotment” on page 276 of this Draft Red Herring Prospectus. You may contact the BRLMs for any complaints pertaining to the Offer including any clarification or information relating to the Offer. RISK FACTORS Notes to the Risk Factors 1. Save as disclosed in the section titled “Capital Structure—Notes to Capital Structure” on page 15 of this Draft Red Herring Prospectus. 2. xix .260 Equity Shares of Rs. 5 each through an Offer for Sale by the Selling Shareholders for cash at a price of Rs. Based on our restated consolidated financial statements. In the event of under-subscription in any of the investor categories. the unsubscribed portion may be added to one of the other categories at the sole discretion of our Company. based on our net worth of Rs. 10. For further information. 9. details of which are disclosed in the section titled “Related Party Transactions” on page 94 of this Draft Red Herring Prospectus. [Š] per Equity Share) aggregating Rs. and 94 of this Draft Red Herring Prospectus. [Š] per Equity Share (including a share premium of Rs. Public offer of 4. was Rs.

5 23. . 19. 2007. Jeeva. Our manufacturing facilities and sales offices are strategically located to ensure our local presence in key markets. (Source A. . bath and incense products.2 17. . This represents 37% of the surveyed household population. . . . . . Exo.4 million surveyed households during the period April 1. household insecticide.6% market share by value in the year ended March 31. We believe the following are our principal strengths: Local presence and wide distribution reach We have a strong local focus to the production. fabric stiffener and washing powder. . Nielsen and.5% market share in India by value for the month ended March 31. .1 21. . . . . (Source A. 2007 March 31. . our Exo dishwash bar achieved a 17% market share in southern India by value for the month ended March 31. personal care and air care segments of the Indian market and offer branded products including fabric whitener. our Ujala fabric whitener achieved a 96. 14. . Our key brands are Ujala. Our Maxo product line consists of mosquito repellent coils. Nielsen) We intend to launch Exo nationally in 2008.7 20. 68. . and Maya. .8 17.2 68. . . . . targeting our various brands and specific products to suit consumer needs and tastes. and dish scrubbers. . . 2007 March 31. Nielsen. liquid vaporizers and aerosol sprays. 2007 Value Volume Value Volume Value Volume Value Volume Ujala Fabric Whitener . in Kerala.1 Exo Dishwashing Bar* .9 24. Ujala’s success led us to be ranked first in fabric whitener with a 68. . (Source A. Our Ujala fabric whitener and Maxo mosquito repellent coils occupy leading positions and have significant market shares in their respective product segments. . 2007. . Maxo.3 52. Market Share (%) Year ended Quarter ended Month ended Month ended Product Categories March 31. 2007 according to A. We believe that our local presence and local focus gives us an advantage in understanding and communicating with our 1 . . The product line for Ujala (a 24 year old brand. . . . as per estimates from Marketpulse-IMRB’s Household Purchase Panel. . . dishwashing. Nielsen) * For Southern India only. We believe that our brands enjoy strong association with our core values including offering value-for-money products to the common man. in particular. Our flagship brand Ujala liquid fabric whitener had a 68. . .C. .C. Our branded products are present throughout urban and rural India.C.1% market share by value in the Indian organized segment in 2006 according to A. We have extended most of our brands nationally. .1 19. .5% market share in India by value for the month ended March 31.C. 2007. .C. SECTION III: INTRODUCTION SUMMARY OF OUR BUSINESS Overview We are a fast moving consumer goods (FMCG) company in the fabric care. Strengths We believe that we are well positioned to sustain and strengthen our position in the markets in which we compete as well as to exploit significant growth opportunities that exist in the expanding household goods sector. . . . We also have entered into joint ventures to market and distribute coffee and spiritual dhoops. mosquito repellent.0 16. . . We have focused the marketing and distribution of our products in various states in India and in both rural and urban areas. We also hire local production.8 17. . in both urban and rural India and abroad. . sales and distribution of our products. . . We produce personal care products under the Jeeva brand and market air freshening incense sticks or agarbatti under our Maya brand.2 17. .0 16.6 14. Exo’s product line includes dishwash bars and dish wash liquid with an anti-bacterial agent. 2007. . Ujala was purchased by 75.2 20. used prior to incorporation of the Company) consists of fabric whitener.7 53. . . 2007 April 30. . . . . For example.1 (Source: A.5 Maxo Coils .5 53.6 53.0 68. Nielsen) In addition. . .4 22. Nielsen) Our Maxo mosquito repellent coils achieved a 20.C.8 68. sales and distribution employees with knowledge of local languages and customs. . . Market share information for our Ujala fabric whitener and Maxo coils in India and Exo dishwashing powder in Southern India is set forth below. . Our brands are particularly strong in southern India and Kerala. surface cleaning. . dish wash powder. . 2006 to March 31.

3% market share in India by value for the year ended March 31.4 million surveyed households during the period April 1. we believe that our brands enjoy strong association with our core values like offering value for money products and service to the common man. In particular. Source: Euromonitor International. they follow a structured process for identifying project ideas. Ujala Stiff & Shine and Jeeva natural soap. We have a research and development (R&D) team comprising of scientists and technicians from various disciplines. implementing improvements and sustaining benefits.63 million outlets in India as on March 31. including through our present products. We have also been able to reduce the weight of our Ujala bottle that has lead to important raw material cost savings. Ujala was amongst India’s 50 most trusted brands . 2007. Ujala was purchased by 75.C. May 30. 2007. The success of our Ujala fabric whitener led us to be ranked first in fabric whitener with a 68. As per estimates from Marketpulse-IMRB’s Household Purchase Panel. The market for FMCG in rural India is growing due to a monetary trickle-down effect from increased urbanization. 2007. good agricultural performance over 2003-2006 boosted rural household incomes. (The Economic Times. as a result of difficulties with distribution. making rural consumers more interested in purchasing packaged household care products. 2007) Our Maxo mosquito repellent coils achieved a 19. detergents.1% market share in India by value for the year ended March 31. testing hypotheses. and Ujala ranked 8th in the home and fabric care segment and 19th among class 2 cities in the Brand Equity Survey. We have a product and formulation R&D centre and our R&D team aims at formulating innovative products and packaging concepts into aesthetically appealing product offerings for the benefit of consumers. Strong brand identity We believe our portfolio of brands. Nielsen. We also have a wide distribution reach. This process has led to new product developments such as our fabric conditioner. provides us with a strong platform to maintain and grow our revenues from those brands. “Household Care”. Nielsen). our Ujala fabric whitener was available in approximately 2. We have established a distribution network across India with a sales staff of over 1. 2 .C. June 6. (Source A. Members of our product development teams undergo competency-building training programs to gain better insight into consumer needs. Maxo mosquito repellent coils were marketed to India’s rural markets and became a leading coil brand in rural India where coils are more popular than other methods as a result of unreliable electricity supply. (Source A. In developing new products.C.500 people servicing approximately 2. For example. product improvements and new products under our existing brands. We believe that our field staff have a direct reach of approximately 1 million retail outlets. Our local presence also provides us with the ability to launch new products and extensions at the local level (on shop shelves) in a short time. 2007. In addition. Nielsen) and received “AAA Brand Performance Award” from All India Advertisers Association in 2002. penetration of branded household care products has been slow. Improved rural economic conditions have resulted in consumers shifting to branded and packaged products from unbranded products .C. This has enabled us successfully to identify and implement new products and product improvements. Focus on the rural markets We believe that our focus on rural markets for our products will allow us to benefit from this growing sector where. establishing prospects.customers. In addition. December 2006. 2007. 2006 to March 31.500 distributors. Innovation and product development We believe a key factor in our ability to succeed and to continue to sustain and strengthen our business has been and will continue to be our ability to innovate and develop improvements to existing products and to create and introduce new products that will meet or create customer demands that are not presently being satisfied by available products. Nielsen) Maxo was the leading mosquito repellent coil in rural India in April 2007 (Source: A. we have established an internal culture encouraging innovation and development. This represents 37% of the surveyed household population. bar. including the brand images and consumer associations those brands enjoy. household antiseptics/ disinfectants and hand dishwashing liquid have benefited notably from this trend. To do this. According to A.

Increase Maxo’s Market Share and Presence We plan to increase the market share and presence of our Maxo products • through the introduction of liquid vaporizers and aerosol spray products.70 million and Rs. We also seek to promote our core values that include offering value for money products to the common man. 2007. 75 million in this Bangladesh joint venture. Our well-qualified and experienced management team has played a key role in the development of good corporate governance. We believe that the strong brand equity of Ujala and our wide distribution reach will help us successfully develop Ujala Stiff & Shine as a national brand. As of April 30. and stable supply chain relationships. We also have an agreement with Godrej Tea Limited to distribute its Godrej Tea brand tea in India. Where possible we intend to obtain joint brand ownership and joint control over the marketing. sales and distribution of these branded products. aimed at customers with astrological interests and beliefs. Our Strategy We intend to work toward achieving our vision and to grow our business by implementing the following key strategies. strong employee relations. Leverage our dominant Ujala brand with other branded fabric care products We plan to leverage the dominant market leadership of the Ujala brand with our Ujala Stiff & Shine and Ujala washing powder products. 2007 and the financial year ended June 30. For example. In addition. We believe our strong presence and local knowledge will allow us to develop Ujala washing powder as a strong regional brand. Utilize our wide distribution network and marketing expertise We intend to utilize our wide distribution network and marketing expertise to attract joint venture partners with existing branded products as well as new and innovative product ideas. • through sales and marketing efforts in Bangladesh where we can leverage the strength of our Maxo brand in West Bengal. The skills and diversity of our employees gives us the flexibility to respond to the needs of our customers and consumers. to tap high growth categories and to reach underdeveloped markets and emerging categories to meet the day-to-day requirement of every Indian household.60 million. we had consolidated net sales of Rs. we have entered into joint ventures to market and distribute coffee and dhoop. • through marketing and product enhancements designed to attract customers from segments of the population and from regions where our competition is strong. 2006 . Our Board has approved an investment up to Rs. 60. We intend to launch our Ujala Stiff & Shine product nationally in 2007. 146 of the senior management team members have been with us for over 5 years.450 employees in India. Our senior management team has a breadth of experience in the FMCG industry. We are dedicated to the development of expertise and know-how of our employees and continue to invest in them through training and skills. we employed a work force of approximately 3. In the nine months ended March 31. our Board has approved a proposal to establish joint venture (with at least 75% of the equity owned by the Company) to manufacture and market our Ujala and Maxo products in Bangladesh. Our Vision Our vision is to develop innovative brands. • through an increase in market penetration of our products. and • through the acquisition of local brands in select markets. effective internal controls and accounting policies. 54. respectively from our joint ventures and marketing contracts. which is a variety of agarbatti. We launched our Ujala washing powder in Kerala in 2005 and will launch the product in other southern Indian states in 2007. 3 .Strong employee base and proven management team We believe that our employee base is a key competitive advantage.

4 . Pursue selective acquisitions We intend to make acquisitions in the future as part of our growth strategy in India. However. We also acquired a fabric whitener brand called “More Light” on May 31.5 million. we intend to adapt our distribution and selling strategies to take advantage of new benefits and seek to maintain and strengthen our brands and our sales. Certain areas identified by us for cost reduction projects include packaging design. 10 million. tax structuring and structuring of financial transactions. 2007 from Modern Chemical (India) & Mod Chem (India) Private Limited for a consideration of Rs. we are able to sustain our culture of innovation and development and to compete more effectively with our competitors. As the presence and importance of new supermarket and hypermarket chains increases. In general. it is expected that this may rise significantly in the next few years.Improve efficiencies and manage our costs We seek to improve efficiencies and costs from the sourcing of the raw materials to the supply of products to consumers. We believe that by aggressively seeking to cut costs throughout our production. We set cost improvement targets each year and offer performance based incentives to key managers to meet such targets. We continuously evaluate acquisition opportunities that arise. the trade margins and discounts expected by supermarket chains in India are higher than traditional retail outlets. While the current share of our revenues through these chains is not significant. distribution and sales process.2007 from Messrs. improving yields. Increase focus on supermarket and hypermarket sales India has in the recent past witnessed the emergence of new supermarket and hypermarket chains. we acquired a local fabric whitener brand called “Ruby Liquid Blue” on April 19 . 9. raw material management. we believe that new supermarket and hypermarket chains generally provide an opportunity for better merchandising and visibility and cost savings through direct sales rather than through intermediaries and rationalization of packaging. For example. We intend to target acquisitions which will strengthen our market position in our key product areas or our manufacturing capabilities. Bangalore Detergents and Plastic Company for a consideration of Rs. especially in the larger cities.

. . . . . . . . . . see the section titled “Objects of the Offer” on page 22 of this Draft Red Herring Prospectus. . . . . . . . 2. . . . . .130 Equity Shares* of which Available for Mutual Funds only*** . . . . .550. . 14. . . . . . . .590 Equity Shares* Pre and post-Offer Equity Shares Equity Shares prior to the Offer . . . up to 2. . . . . . . . . . . . . . . .260 Equity Shares of which Qualified Institutional Buyers (QIBs) Portion** . . . . . . *** In the event of under-subscription in the Mutual Fund Portion only. . . . . the unsubscribed portion may be added to one of the other categories at the sole discretion of our Company.104. . . . . For further information. . . . 4.215. THE OFFER The following table summarizes the Offer details: Equity Shares offered by: The Selling Shareholders . . . . . . . . . . . . the unsubscribed portion would be added to the balance of the QIB Portion to be allocated on a proportionate basis to QIB Bidders. . . . . 110. . . . . the Selling Shareholders and the BRLMs. allocation shall be made on a proportionate basis. . . . . . . . .760 Equity Shares Use of Offer proceeds Our Company will not receive any proceeds from the Offer. . . . . . . . . . . . **** As this Offer is through an Offer for Sale. . . . . . . . . . . . . . . . .513. . . . . 14. . . . . . . . . . . . . . . . . . . . . . . .513. . . 664. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .370 Equity Shares* Non-Institutional Portion** . . . . ** In the event of under-subscription in any of these categories. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . there will be no change in the number of Equity Shares our Company has in issue as a result of the Offer. . . . . . . . . . . . . . . . . .760 Equity Shares Equity Shares after the Offer**** . . . . . . . . . 5 . * In the event of over-subcription. . . . . . . .760 Equity Shares* Balance of QIB Portion (available for QIBs including Mutual Funds) . 1. .540 Equity Shares* Retail Portion** . .430. . . . .

.51 855. .534. .96 Provisions . . 1.72 334. . .93 40.31 1. . .65 1. . .099. . . .30 235.93) (125. . INTANGIBLE ASSETS . . . . . . 6 . . 158. . . SUMMARY FINANCIAL INFORMATION The following table sets forth summary financial information derived from our restated financial statements as of and for the fiscal years ended June 30. . . .099.93 1. 1. . .79 The above statement should be read with the notes on adjustments for consolidated restated financial statements and significant accounting policies as appearing in Annexure IV and IVA respectively.16 9.172. . . . .10 570. . . .01 33. . .44 849. . . . .81 364.155. . . June 30. . . .34 B. Miscellaneous Expenditure (to the extent not written off or adjusted) .93) (258. .15 — — — — — Net worth (F+G-H) . . . . . . LIABILITIES AND PROVISIONS Secured loans .29 85. . .02 1. . . . . . .96 Sundry debtors . . . . . . .10 261. . . . .93 24. . . . . . . (294.050.27 E.78) (76.462. . 509. . . . . 5.58 2. . . .89 135. 2007.59 599. 2. . . . . . .61 1. . . .83 17. .16 23. . . . . .43 605.07 Less: Accumulated depreciation and impairment loss . . . 989. . .756. . . .22 Total . . . 2.64 Deferred tax liability.08 Net worth (A+B+C+D-E) . 0. 629. . .03 52. . . . .534. . . . . . 72. March 31.43 69. .57 56. . . . . . . . 690. . . . . . .21 681.889. March 31.28 14.81 106.57 72. . . . . .355. . . . .102. INVESTMENTS . . .06 26. .00 56.47 36. .49 Cash and bank balances . . .71 322. .79 Net worth represented by F.027.22 75. .44 794.94 397. . .57 72. LOANS AND ADVANCES Inventories . .28 844. . 2005. .93 1. .14 1. 0. .21 1. . . .959. . .29 240. . .32 741.95 Capital work in progress (including capital advances) . . . .284. . . . . . .75 Loans and advances . . . . .889. .88 257. .39 Total . . . . 9. . . .72 20. . . . .829. . .75 285. . . . . . CURRENT ASSETS. . . .82 25. . . . . . . . . . . . . . .85 Other current assets—Sales promotion items . .99 1. . net . . . . . . . . the notes thereto and the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” on page 205 of this Draft Red Herring Prospectus. . . .46 4. .816.46 69. 300. . . . . . .31 Unsecured loans . March 31.155. . .89 2. . . 2. . . . .82 2.22 769.50 919. . .66 20.625. . . . which are included in this Draft Red Herring Prospectus under the section titled “Financial Statements” on page 97 of this Draft Red Herring Prospectus.30 D. . . .31 101.06) (50. .49 270.93 1. . . . Reserves and surplus . . . . . . . . . .58 2. . . . .73 779.02 253.33 — — — Current liabilities . . . . . .782. . .31 1.77 413. . . . . .58 11. .13 197. .55 341.00 G. . 1. . . .62 752. . .79 H. . . . . . . . .97 135. .01 598. . as restated (Amount INR Million) As at As at As at As at As at As at March 31.71 362. . . . .77) (209.17 Total .85 2. PARTICULARS 2007 2006 2005 2004 2003 2002 A. . . . .277.16 18. . . . .60 198. . Share capital . . . . . 8. . .17 0. .12) Net Block . . . . .24 2. . .14 1. .48 892. . . .96 C.719. . . . . . 2. . . . June 30.90 3. . . . . June 30. The restated financial statements have been prepared in accordance with the SEBI Guidelines and have been restated as described in the auditors’ report attached thereto. FIXED ASSETS Gross Block . The summary financial information presented below should be read in conjunction with the financial statements included in this Draft Red Herring Prospectus. . . . . . . .83 13. . . . . . . . . . . . .05 1. . . . 50. . .80 653.64 195.267. . .57 72.78 249. .97 211. . . . . . Summary Statement of Consolidated Assets and Liabilities.106.54 18.58 186.01 2. . . . . . .54 217. 2003 and 2002 and the nine months ended March 31. . .01 0.829.91 37. . .74 1. . . 549. .57 1. . . . .01 0. . . . . . . . . . . . . . . . . . . . . . . . . . .85 261. . . . . . .25 2. . .81 1.66 1. . . 400. . . .99 979. 2004.78 279.11 9. 54.91 125. . . . . . . . . .92 198. . . . .106.172. . . . 2006.18 1.538.24 2. . .46 193. . .

. . .82 18.26) (54. . . . . . .79 — Dividend on preference shares . . . . . . . .70 1. . .85 223. . . . . . . . . . . .38 298.53 — 1. . . . . .09 3. . .23) 207. .00 NET PROFIT BEFORE ADJUSTMENTS . . . . . . .29 Provision for doubtful debts / Bad debts written off . . . .59 286. . . . . (58. . . . . . .13 5. . . .31 348. . . . . . . . . . . . . .08 EXPENDITURE Materials consumed .453. . .22 2. . .600.43 189. .00 250. . . . . .70) (389. . . . . .85) — — — — Exceptional item—Provision for dimunition in investments . . . . . .50 0.64 57. . . . . . . .713. .49 312. . . .48 1. . .00) — — — PROFIT BEFORE INTEREST. . . . . . . . . 3. . . . .50) (206.92 91. . . . .28 3. .01 3. .52 3. . . . . .001. 102.94) — — Prior period item—Trade discount expenses . . . . . . . . . . . . . . . .46 2. . . . .65 1. . . . . . . . .00 262. . . . . . . .572. . . . . 7.18 1. .71 (230. . . .08 1. . . .28 13. . . .59 207. . . . . . .50 25.42 PROFIT BEFORE PRIOR PERIOD ITEM. . . . . .00 — Tax on proposed dividend . . . .19) 5. . . . . . . . . . .91 292. .27 0. . . . .53 75. . . . . . . . .57 (158.54 519. . . . . . .00 394. .02 Transfer to general reserve . . . . . .72 Total Income (A) . . . . . . EXCEPTIONAL ITEM. . .38 Advertisement and publicity . .66 (190. AS RESTATED . . .57 34. . . . . . . . . . . . . . . . . .09 Profit and loss amount at the beginning of the year / period . . .03 (Increase)/Decrease in finished goods/work in progress . . . . . . . .83 60. . . . . .80 20. . . .425. . . . . . . . . .878.81 121. . .26 APPROPRIATIONS Interim dividend on equity shares . . . . . .85 280. . . . . . . 48. . . . . . .23) 207. . . . . .15) (273. .496. . (4. . . .57) (refer note no. . . . . . . . . . .00 TOTAL . . .95 2.13 0. . .66 ADJUSTMENTS . March 31.48 157. . . . . . . . .89 — 14. . . . . . . . . . . . . .00 309. .65 334. .63) (6.73 — 175. . — (28. . .56 462. .70 (56. . . . . . . . . . . . . . . . . 471.36 (112.51 2. .45 16.09 (31. . . . . . . . . . . .59 286. . . . . . . . . . . .72) (76.39) (45. . .13) 63. .81 1. . . . . .00 — 160. . . . .22 — Total Expenditure (B) . . .61 Sales promotion and schemes . . . .24) Less: Excise duty recovered . . . . .48 2. . . . . . . .43 Proposed dividend on equity shares .21 Operating and administrative expenses . . 395. .54 1. 45. . . . . . .42 — — 1.17 60.665. . . . . . . . .02) 259. . . . . . 448. .30 25. .13) (0. . . . . .59 The above statement should be read with the notes on adjustments for consolidated restated financial statements and significant accounting policies as appearing in Annexures IV and IVA respectively. . .14) (203. . . . . . . . . . . . .67) (80. . . . — — — — — 0. . .89 — — 14. . .82 1. DEPRECIATION AND TAX (A-B) . .70 78. . . . . . . .68 (32. . . .860. . .03 47. . . . . . .66 Prior period item—Advertisement expenses . . . . .22 947. . . . . . .90 57. . . . . . — — — — — 0.40) (59. . . . AS RESTATED . . . . . . . . .43 274. . . . . . . . . . . . . . . 336. . . . . . . . . . . .Summary Statement of Consolidated Profits and Losses. . . March 31. . . . . . . .78 329. . . .36 Other income . . . .17 Balance available for appropriation. . — 18.470. . . . . .08 487. . . . .13 497. . . . . . .08) 259. 72.556. . . INTEREST.50 49. . . . . . . (18. . — (6. . as restated . . . . . . . . . . . . . .11 0. . . . . . . . . . . .57 3.50 2. .66 31. . (286.27) (160. . . . . . . . . . . . .79 255. . IV of annexure IV) .14) (242. . 52. . . . .95 25. . . . . . . .43 0. . .00 160. . . . . . . . . . . 44. . . . . 2.25 320. . . .15) 177. . .97 2.40) (70. . 388.140. .72 344. . .21) (7. 303. . . .05 115. . .142. .37 32. . .00 Tax on interim dividend . . . . . 496. . .61 429. . . . .82) 96. .41 3. . . . . 1. . . . June 30. . . . 93. . . .382. . . . .019. . .95 21. . .27 31.22 Tax on dividend on preference shares . . . . . . . .97 Depreciation / amortisation . . . . . . . . . . . . . . . . . — 2. . . . . — 300. . . . . . . . .05) 212. . . . . . . . . . .97 50. . . . . . . . . .15 53. . . . 2. . . . .08 21. .18 10. .50) — (24.40 109. .49 312. . . . . . . . . . . 47. . . 0.23) 383. . . .23) Less: Trade discount (refer note no. . . .69 398.75 (23. . . .775. .38 462.14 (72. . . . . . . .56 56. . . . . . .319. .36 (87.25 584. . . .57 10. . . . .828. . .25 332. . . . PARTICULARS 2007 2006 2005 2004 2003 2002 INCOME Sales (gross) . .20 28.75 403. . . . . . . . . .61 2. . . . . .90) 35. . . . . . . . . . .67 BALANCE CARRIED FORWARD. . . . . . . .47 0. . . . . .34 3. . . .00 PROFIT BEFORE TAX . . . .89 14.205. . . . . . . . .943.00 —Deferred tax . . . 496. . . . . 2. .57 34. . .47 3. .463.29 57. . . . . 10.33 2. . . . .92) 20.663. . . .79 175. . . . . .19 25. . .66 Interest and finance charges . .32 1. . . . . .48 260. . 0. . . . . . .10) Employee costs . . . .38 93. . .74 8. .86) (99. . . . .66 Provision for tax —Current tax (including short/excess provision for current tax of earlier years) . . . . . . . . . . . . . . . 377. . . . . . . . . . . . . .83 Less: Sales tax recovered . . . . . . .14 10. . 7 . .66 — —Fringe benefit tax .088. . . . . . . .25) — Net sales (refer note no. . . . (174. 1. . . . . . .48 266.14 — TOTAL . . . June 30. . DEPRECIATION AND TAX .30 287. . . .50 29. . I-3(g) of annexure IV) . . . 82. . .96) (6. June 30. . . . . .57 72. . . . .77 3. . . . . . . . . . . . .25 548. . . .48 (23.34 487. . . as restated (Amount INR Million) Nine month Fifteen months ended Year ended Year ended ended Year ended Year ended March. . . . — — (60. . . . . .175. . .30 2. . . . .359.294.23 21.03 2.518. . .00) (195. 225. . . . .85 420. .75 (23. . . .03 TOTAL .61 490.50 2. . 2. . . . . I-2 of annexure IV) NET PROFIT. . . . . . . . .653.80 — — — —Wealth tax . . . .62 271. . . .68 283. . . . . . .

Bansal Jyothy Laboratories Limited. Nariman Point. L.ipo@enam. . . Dalamal Towers. .com Website: www. . Mumbai 400 021. Executive Director (Deputy Managing Director) Ms. P. Padmakumar .: 11-128651 Corporate Identification No. refund orders etc. . . . see the section titled “Our Management—Our Board of Directors” on page 74 of this Draft Red Herring Prospectus. Sachin K. . .com Contact Person: Mr. . . Chandrakant Bhole Contact Person: Mr. . 100 Marine Drive. . . . . P. . Non-executive independent Director Mr. M. Shivshakti Industrial Estate. . 43. . Jyothy . such as non-receipt of letters of allocation. . Mumbai 400 059. . Mumbai 400 059 Registration No. 801/802. . . . Chandiwal 8 . Shivshakti Industrial Estate. Mumbai 400 002. Tel: (91 22) 2850 2470 Fax: (91 22) 2850 1734 Email: ipo@jyothy.kotak. . K.ipo@kotak. .com Website: www. . . . 229 Nariman Point. . . . . M. . Nilesh B. . Bakhtawar. Andheri-Kurla Road. . . . Ramachandran .com Email: jyothy. . . K. . . . M. Non-executive independent Director Mr. . credit of Allotted Equity Shares in the respective beneficiary account. GENERAL INFORMATION Our Registration Details Jyothy Laboratories Limited 43. Mehta . Executive Director Mr.: U24240MH1992PLC128651 We are registered with the RoC for Maharashtra situated at Everest Building. . . Andheri-Kurla Road. . . Marol. . . Company Secretary and Compliance Officer Mr. Our Board of Directors Name Designation Mr. Executive Director (Chairman and Managing Director) Mr. . Mumbai 400 021. . . .enam. R. Ullas Kamath . . Marol. Shah . Non-executive independent Director For further details of our Directors. . Book Running Lead Managers Kotak Mahindra Capital Company Limited Enam Financial Consultants Private Limited 3rd Floor. Bipin R. . Tel: (91 22) 6634 1100 Tel: (91 22) 6638 1800 Fax: (91 22) 2283 7517 Fax: (91 22) 2284 6824 Email: jyothy. .com Investors can contact the Compliance Officer or the Registrar for the Offer in case of any pre or post-Offer related problems.

Tel: (91 22) 6634 1100 Tel: (91 22) 6638 1800 Fax: (91 22) 6630 3927 Fax: (91 22) 2284 6824 Email: umesh.400 021 Tel: (91 22) 2287 6485 Fax: (91 22) 2287 6401 Bankers to the Offer and Escrow Collection Banks [Š] Bankers to our Company ICICI Bank Limited The Federal Bank Limited 163. 801/802. Mumbai 400 058. Tel.enam. 10 Laram Centre. Pannalal Silk Mills Compound. Lower Parel. Ashwini Kadam Email: bbyb@federalbank. Batliboi & Associates Chartered Accountants 6th Floor.com Contact Person: Mr.com Website: www. Dalamal Towers. 5th Floor. Express Towers. (91 22) 2628 8115 Email: corporatecare@icicibank.com Website: www. Sachin Achar Auditors to the Company S. Mumbai 400 078 Tel: (91 22) 2596 0320 Fax: (91 22) 2596 0329 Email: jyothylabs-ipo@intimespectrum. Mumbai .com Contact Person: Mr. Road. Mumbai 400 013. Vinay Kumar Seth 9 . Nariman Point. Peninsula Chambers. Tel: (44 20) 7588 0800 Fax: (44 20) 7588 0555 Registrar to the Offer Intime Spectrum Registry Limited C-13.R. Peninsula Corporate Park.com Email: jyothy.Syndicate Members Kotak Securities Limited Enam Securities Private Limited 1st Floor. Natarajan Domestic Legal Advisor to the Offer Amarchand & Mangaldas & Suresh A. HT Parekh Marg A-8. (91 22) 2624 9636 Contact Person: Ms. Shroff & Co.kotak. Bakhtawar.co. Nariman Point. V. Ganpatrao Kadam Marg. England. Mumbai 400 021. M.gupta@kotak. LBS Marg. 229 Nariman Point. 9. Tel: (91 22) 2496 4455 Fax: (91 22) 2496 3666 International Legal Advisor to the BRLMs Dorsey and Whitney 21 Wilson Street.intimespectrum.in Contact Person: Mr. Bhandup (West). Backbay Reclamation S. (91 22) 6653 8787 Fax: (91 22) 6653 8855 Tel.com Fax.ipo@enam. London EC2M 2TD.com Website: www. Mumbai 400 028 Andheri (West). Mumbai 400 021. Umesh Gupta Contact Person: Mr.

inter alia: KMCC & ENAM KMCC • Institutional marketing strategy. IPO Grading This Offer being has been rated by [Š] as [Š] (pronounced [Š]) indicating [Š]. • Finalizing media and public relations strategy. including finalization of Prospectus and the RoC filing. prospectus and deciding on the quantum of the Offer material. and • Preparation of Frequently Asked Questions for the road-show team. Appointment of Registrar to the Offer and Banker(s) to the Offer.. Statement of Inter-Se Allocation of Responsibility The responsibilities for various activities in this Offer are set out below: Activity Responsibility Co-ordinator Capital structuring with relative components and formalities such as KMCC & ENAM KMCC type of instruments etc. Pursuant to Clauses 5. Appointment of intermediaries viz. and • Finalizing road show schedule and investor meeting schedules. The BRLMs shall ensure compliance with stipulated requirements and completion of prescribed formalities with the Stock Exchanges.1 and 6. printer(s). • Finalizing the list and division of investors for one to one meetings. including its operations. which will cover. the rationale/description furnished by the credit rating agency will be updated at the time of filing the Red Herring Prospectus with the Designated Stock Exchange. • Following up on distribution of publicity and Offer material including form. Due-diligence of the Company. Trustees As this is an Offer of Equity Shares. including memorandum containing salient features of the Prospectus. KMCC & ENAM ENAM Non-institutional and retail marketing of the Offer. including KMCC & ENAM ENAM corporate advertisements. 10 . there is no credit rating.Credit Rating As this is an Offer of Equity Shares. the RoC and SEBI. inter alia: • Formulating marketing strategies and preparation of publicity budget. KMCC & ENAM KMCC management. which will KMCC & ENAM ENAM cover. and advertising KMCC & ENAM KMCC agency for the Offer. Drafting and design of the Draft Red Herring Prospectus and of statutory advertisement. business plans.17. and • Finalizing collection centers. the appointment of a trustee is not required. • Preparation and finalization of the road-show presentation. • Finalizing centers for holding conferences for brokers etc. KMCC & ENAM KMCC • Approval of all non-statutory advertisements.6B.3A of the SEBI Guidelines. Drafting and approving all statutory advertisements. Institutional marketing of the Offer. legal etc.

• the Selling Shareholders. • the Syndicate Members. including management of Escrow Accounts. The remainder shall be available for allocation on a proportionate basis to QIBs and Mutual Funds. see the section titled “Terms of the Offer” beginning on page 253 of this Draft Red Herring Prospectus. who must be intermediaries registered with SEBI under Section 12(1) of the SEBI Act or registered as brokers with the Stock Exchange(s) and eligible to act as Underwriters. Post-Bidding activities. The post-Offer activities will involve essential follow-up steps. QIB Bidders are not allowed to withdraw their Bid(s) after the Bid/Offer Closing Date. subject to valid Bids being received from them at or above the Offer Price. The principal parties involved in the Book Building Process are: • our Company. Further. • the BRLMs. Monitoring Agency There is no requirement to appoint a monitoring agency for the Offer under clause 8. with reference to the Offer. Book Building Process Book building. Managing the book and finalization of pricing in consultation with KMCC & ENAM KMCC the Company. KMCC & ENAM ENAM bidding terminals and mock trading. QIBs are not allowed to withdraw their Bids after the Bid/Offer Closing Date. subject to valid Bids being received at or above the Offer Price. The Book Building Process under SEBI Guidelines is subject to change from time to time and investors are advised to make their own judgment about investment through this process prior to making a Bid in the Offer. For further details. we have appointed the BRLMs to manage the Offer and procure subscriptions to the Offer. and who are appointed by the BRLMs. Activity Responsibility Co-ordinator Co-ordination with Stock Exchanges for Book Building software. out of which 5% shall be available for allocation on a proportionate basis to Mutual Funds only. In this regard. The BRLMs shall be responsible for ensuring that these agencies fulfill their functions and enable it to discharge this responsibility through suitable agreements with the Company. at least 15% of the Offer will be available for allocation on a proportionate basis to Non-Institutional Bidders and at least 35% of the Offer will be available for allocation on a proportionate basis to Retail Individual Bidders. The Offer Price is finalized after the Bid/Offer Closing Date. including finalization of trading and dealing of instruments and dispatch of certificates and demat and delivery of shares with the various agencies connected with the work such as the Registrar to the Offer and the bank handling refund business. KMCC & ENAM ENAM co-ordination of allocation.1 of the SEBI Guidelines. The Offer is being made through the 100% Book Building Process wherein up to 50% of the Offer shall be available for allocation on a proportionate basis to QIBs. refers to the process of collection of Bids within the Price Band on the basis of the Red Herring Prospectus. Illustration of Book Building Process and Price Discovery Process (Investors should note that this example is solely for illustrative purposes and is not specific to the Offer) 11 . We will comply with the SEBI Guidelines and any other ancillary directions issued by SEBI for this Offer.17. intimation of allocation and dispatch of refunds to Bidders etc. and • the Registrar to the Offer. Pursuant to amendments to the SEBI Guidelines.

It is proposed that pursuant to the terms of the Underwriting Agreement. All bids at or above the offer price and cut off bids are valid bids and are considered for allocation in the respective categories. Underwriting After the determination of the Offer Price and allocation of the Equity Shares that are proposed to be sold pursuant to the Offer.500 50% 1. The highest price at which the company is able to offer the desired number of shares is the price at which the book cuts off i.000 23 1. Bid Price Subscription Bid Quantity (Rs.67% 1. The company and any selling shareholders.000 166. an offer size of 3. Rs.500 22 3.000 equity shares and receipt of five bids from bidders. in consultation with BRLMs. the BRLMs shall be responsible for bringing in the amount of monies devolved in the event that their respective Syndicate Members do not fulfill their underwriting obligations. will finalize the offer price at or below such cut off price.500 20 7. A graphical representation of consolidated demand and price would be made available at the bidding centers during the bidding period. assume a price band of Rs.500 shares at Rs. at or below Rs.000 100% 2. 22 in the above example. For instance. our Company and the Selling Shareholders will enter into an Underwriting Agreement with the Underwriters for the Equity Shares proposed to be offered through this Offer. 22 per share. The illustrative book given below shows the demand for the shares of the company at various prices and is collated from bids from various investors. 12 .67% 2. 20 to Rs. 24 per share. out of which one bidder has bid for 500 shares at Rs.e. 22. 24 per share while another has bid for 1. Bidders can bid at any price within the price band. i.500 250% The price discovery is a function of demand at various prices.) Cumulative Quantity (%) 500 24 500 16.000 21 5.e. but prior to filing of the Prospectus with the RoC.

Tel: (91 22) 6638 1800 Fax: (91 22) 2284 6824 Email: jyothy.com Contact Person: Mr. M.gupta@kotak. of Equity Amount underwritten Name and address of the Underwriters Shares underwritten (Rs. 229 Nariman Point. The Underwriters are registered with SEBI under section 12(1) of the SEBI Act or registered as brokers with the Stock Exchange(s). will also be required to procure subscriptions for or subscribe to Equity Shares to the extent of the defaulted amount. Notwithstanding the above table. Mumbai 400 021.com Website: www. Chandrakant Bhole Enam Financial Consultants Private Limited [Š] [Š] 801/802. the resources of the Underwriters are sufficient to enable them to discharge their respective underwriting obligations in full.enam. Mumbai 400 021. Tel: (91 22) 6634 1100 Fax: (91 22) 6630 3927 Email: umesh. Mumbai 400 021. at its meeting held on [Š]. Dalamal Towers Nariman Point. the respective Underwriter.ipo@enam.ipo@kotak. in addition to other obligations set out in the Underwriting Agreement. Our Board of Directors.com Contact Person: Mr. Sachin K. Chandiwal Kotak Securities Limited [Š] [Š] 1st Floor. Bakhtawar. The Underwriters have indicated their intention to underwrite the following number of Equity Shares: (This portion has been intentionally left blank and will be filled in before the filing of the Prospectus with the RoC) Indicative no.kotak.com Website: www.com Website: www. In the event of any default in payment.enam. Mumbai 400 021. Dalamal Towers Nariman Point. has accepted and entered into the Underwriting Agreement on behalf of our Company.com Contact Person: Mr.kotak. 229 Nariman Point. In the opinion of our Board of Directors (based on a certificate given by the Underwriters). Tel: (91 22) 6638 1800 Fax: (91 22) 2284 6824 Email: jyothy. Umesh Gupta Enam Securities Private Limited [Š] [Š] 801/802.ipo@enam. 13 . Tel: (91 22) 6634 1100 Fax: (91 22) 2283 7517 Email: jyothy. Bakhtawar. in million) Kotak Mahindra Capital Company Limited [Š] [Š] 3rd Floor. Natarajan The above mentioned amount is indicative underwriting and will be finalized after the pricing and allocation.com Contact Person: Mr. the BRLMs and the Syndicate Members shall be responsible for ensuring payment with respect to Equity Shares allocated to investors procured by them.com Website: www.

. . 5. . . . . 4. . Offer in accordance with this Draft Red Herring Prospectus Equity Shares offered by: . Share premium account Before the Offer .000 Preference Shares was increased to Rs. . 8. . . .000 comprising 2. .000 divided into 4. . .000 Equity Shares and 50. . . . . . 1997.312. .513. . The authorized capital of Rs. .000. .800 E. 5 each pursuant to a resolution of the shareholders at an EGM held on June 9. . . . . . is set out below: Aggregate value at face value of Aggregate value at Rs. . .000.500.000 comprising 2. . 1997. .000 comprising 9. 22.000. . . subscribed and paid-up capital before the Offer 14. .000. .065. . .000 Preference Shares was increased to Rs. .430. . . as at the date of filing of this Draft Red Herring Prospectus with SEBI. . . . . 100 pursuant to a resolution of the shareholders at an EGM held on March 26. . . 10. . 2. .000 comprising 6. . . . .000. 5. . . . 100. . . . 1. . . . .000 each was increased to Rs. 5. 5. . . . 3. 10 each was split into 20. . 1995.000.000 Preference Shares was increased to Rs. . . .568. 1. . .000. . . .500. . . .000 equity shares of Rs.000 Equity Shares and 50.260 Equity Shares . . . . . .800 C. . . . 2007. . 10. . . . .000 comprising 1.568. 72. The authorized capital of Rs. The authorized capital of Rs. 100.000 Preference Shares with a face value of Rs.000. . .000 comprising 6.000 comprising 4. . . 72.000.000 Equity Shares . . . . . 14 .000 each pursuant to a resolution of the shareholders at an EGM held on July 24.000 comprising 1. . .000.000 equity shares of Rs. . . . . . . . .513. .500.500. . . .000 comprising 10. . . . . . . . 5. .000. .000 Preference Shares pursuant to a resolution of the shareholders at an EGM held on February 1. .500.000.000 Equity Shares and 50.000 Equity Shares and 50. . . 100.000 comprising 5. . .000 Preference Shares was reclassified into 10. 100. 5. . . .) A. . 50. . . Issued. . . . . .312. .760 Equity Shares . .300 [Š] D. . .000 each was increased to Rs. . . . .000 Preference Shares pursuant to a resolution of the shareholders at an AGM held on September 29. .000. . . . . . .760 Equity Shares .000. . .000. 60. . .000 equity shares of Rs. . .000. . The authorized capital of Rs. .000 equity shares of Rs. . . .000. 1993. . . .000 comprising 9. .000 comprising 5. . . . . 5. . . . 7.151. CAPITAL STRUCTURE Share Capital Before and After the Offer Our capital structure before the Offer and after giving effect to the Offer. . 50. . 5each Offer Price (Rs. . . . . . subscribed and paid-up capital after the Offer 14.000 Equity Shares and 50. . . .000 Equity Shares with a face value of Rs. .000 Equity Shares pursuant to a resolution of the shareholders at an EGM held on September 7.325 Authorized Share Capital History 1. The authorized capital of Rs. . . Authorized share capital 20. . . . . . .000 Equity Shares and 50. . . . .000.065. .000 Equity Shares of Rs. 60. . . . . . . . .500. . . . 2001. 2000. . . .000 B.000 equity shares of Rs. . . .) (Rs. The authorized capital of Rs.325 After the Offer . . . . . . 6. . . Issued.000 each pursuant to a resolution of the shareholders at an EGM held on March 27. . . . . . . . . .000. 5. 10 and 50.000.000 each was reclassified and increased to Rs. .000.000 Preference Shares pursuant to a resolution of the shareholders at an EGM held on December 24. 65. . . . 65. The authorized capital of Rs. . 2. .000 comprising 400 equity shares with a face value of Rs.000 Equity Shares and 50. . 2002. . The Selling Shareholders 4. . . Our initial authorized capital of Rs.

. .525. . . . .500. M.505. . . . . . . . . . . . . . . 611 5. . Divakaran February 1. . . . of Equity Shares offered Canzone Limited . .Selling Shareholders The details of the Equity Shares being offered by each of the Selling Shareholders as part of the Offer are as follows: Selling Shareholders No. . . .000 5. . .414.510. . . . .451. Jyothi February 1. . . . . . . . . . P. . . . . . M. . . .000 5. .000 5.000 Cash Preferential allotment to 901 4. .130 ICICI Bank Canada . Ramachandran February 2.) payment allotment shares (Rs. . . . P. . K. Ramachandran March 26. . G.000 Cash Preferential allotment to 903 4. . . . . R. 20 5. . . . . .1 Equity Share Capital History Face Issue value price Cumulative per per Cumulative issued Cumulative No. . .520.000 Cash Preferential allotment to 833 4. .064 TOTAL . . .430. . . . . . . of equity equity no. . . . . .000 5. . .000 Nil 1995 Ms. .515.000 Cash Preferential allotment to 906 4. M. . K. . . . P. . . P. 1 5.000 5. . . . 1 5. . . . .530.200 ICICI Bank UK PLC .000 Nil 1994 Ms. .) (Rs. . . Ramachandran March 26. . . . . . . 20 5. .000 5. . . . P. .000 Nil 1994 Ms. M.) January 15. . . . . .000 Nil 1992 Mr. . . . . . 120 5. . . . . . M. .000 Cash Preferential allotment to 904 4. . Sidharthan February 1. .000 5. . . M. 1 5. . . . .000 Cash Preferential allotment to 200 1. .000 Nil 1995 Mr. . . . . 67 5. .260 Notes to Capital Structure 1. . B. . . . . . 20 5. . . 1 5.000 Cash Preferential allotment to 902 4. . . 782. .000 Cash Allotment to 20 100. . . . . . . . . . . M.000 Cash Preferential allotment to 80 400. .000 Cash Preferential allotment to 905 4. . . . . . 20 5. . . . . . .000 Nil 1995 Ms. G. . 22 5.066 CDC Investment Holdings Limited .000 Nil 1995 Mr. . . . . M. . . . . . P. 1. . . . .000 Nil 1992 Ms.000 Nil 1992 Mr. . . .000 Nil 1995 Ms. .000 Cash Preferential allotment to 811 4. . . .000 Nil 1995 Mr.000 5.000 5. Santhakumari as subscriber to the Memorandum February 2. .000 5. Share Capital History of our Company 1. K. Santhakumari March 26. . .000 Nil 1993 Mr. . . . . .800 South Asia Regional Fund . . . . . . 391.165. .000 Cash Preferential allotment to 60 300. . M. . . . Beena February 1. . Ramachandran as subscriber to the Memorandum January 15. Santhakumari February 25. M.055. . . G. .) (Rs. . . .000 5. .000 Cash Preferential allotment to 900 4. . 1. . . . U.000 5. .000 Cash Allotment to 40 200. . . M. . 4. . .000 5. . . Sujatha February 1. 391. . M. .000 5. . . . . R. . . 1 5.000. . . . 1 5. . .000 Nil 1992 Ms. Deepthy 15 . Panjan February 1. of equity share equity share Date of equity share share Nature of Reason for equity capital premium allotment shares (Rs. .000 Nil 1994 Mr. . .

200 10 10 Cash Preferential allotment to 3.995.258.000 Nil 1995 Ms. Divakaran February 17.000 5.195. 1 5. of equity share equity share Date of equity share share Nature of Reason for equity capital premium allotment shares (Rs.) payment allotment shares (Rs. P.000 5. M. G.882 9.000 Nil 1995 Mr.000 5. Divakaran (HUF) March 27. P. Panjan February 17. K. M. B.624. 300 10 10 Cash Preferential allotment to 3. Divakaran (HUF) March 27. P. 5. P.190.261.120.000 Cash Preferential allotment to 911 4. Panjan March 27.897. 153. Deepthy April 3.562. M. 5 5.000 Nil 1995 Mr. 27 5. K.999 9. M.280 10 10 Cash Preferential allotment to 3. P.000 10 10 Cash Preferential allotment to 4.780 31.919.852 9. 826 5.645.000 Nil 1996 Mr.350 32. G.000 sub-divided into 500 equity shares which have a face value of Rs.000 Cash Preferential allotment to 1.500 9. Sidharthan March 27. 100.800 Nil 1997 Mr. B. M. M. M. P. K. 5 5. Ramachandran April 3.000 40.895.570 10 10 Cash Preferential allotment to 3. P. M.680 10 10 Cash Preferential allotment to 3.000 Nil 1997 Mr. M.000 Nil 1997 Ms.300 Nil 1997 Mr.662. Beena February 17. 203. M. Ramachandran March 27. R. 9 5.000 Cash Preferential allotment to 998 4. 59 5.766.000 5.280 10 10 Cash Preferential allotment to 3. M.995.000 Cash Preferential allotment to 929 4. R.000 Cash Preferential allotment to 1.000 Cash Preferential allotment to 939 4.000 Cash Preferential allotment to 1.851 9.200 Nil 1997 Mr. 20 5.000 Nil 1995 Ms.) (Rs.800 10 10 Cash Preferential allotment to 3. 68. M. Beena March 27.000 5. Santhakumari March 27. 10 each March 27.198.000 Nil 1995 Mr.500 Nil 1997 Ms.095.990.000 Nil 1995 Mr.030 32.000 Nil 1997 face value of Rs.000 5. P.000 5.000 Nil 1995 Mr. Sujatha March 27.260. P.583. Sidharthan February 17. M.000 39.330 32.000 5.824 9.000 Cash Preferential allotment to 920 4.420 35.000 Cash Preferential allotment to 1.800 39.000 Nil 1995 Mr. M.) February 17.410. 30 5. Divakaran March 27. P. M. 75.000 Nil 1997 Mr.261.670. M. Santhakumari July 1. K.995.300 Nil 1997 Ms.000 5.000 Cash Preferential allotment to 934 4.000 5.600.919. of equity equity no.000 Nil 1997 Ms. K. 2. P.000 Cash Preferential allotment to 1.500 39.000 5.090 10 10 Cash Preferential allotment to 3. P. Face Issue value price Cumulative per per Cumulative issued Cumulative No.000 Nil 1995 Ms. U.610. M.000 5.950. Sidharthan April 3. 5 5.000 Nil 1995 Ms. Each equity share with a 999. 9 5. 97 5. 2.695. 300 10 10 Cash Preferential allotment to 3.950.613.) (Rs. 301. M. U.979 9. K. Ramachandran January 8.189. Sujatha February 17. Jyothy March 27.200 Nil 1997 Mr.000 Cash Preferential allotment to 1. Ramachandran (HUF) 16 .220 37. Divakaran April 3.255.555.000 Nil 1995 Mr.

800 1.142.001.220 10 582. 10. Divakaran (HUF) March 30.500 Nil 1998 to Mr.000.660.400 627.500 Nil 1998 to Ms.000 10 10 Cash Preferential allotment 4.) (Rs.42 Conversion Conversion of 7.256.800 1. Sidharthan (HUF) March 31. P.000 2000 to Baring India Investments Limited June 1.000 10 10 Cash Preferential allotment 4.041.995.112.220 60.200 390. 463. M.B.734. 5 each 17 .350 2003 of debentures for South Debentures Asia Regional Fund November 22.428.968.750 50.949.220 10 582.600 47. Santhakumari March 30.000 10 10 Cash Preferential allotment 4. 2007 Each equity share with 14.200 49.017.750 49.000 10 10 Cash Preferential allotment 4. 40.682. M. Sidharthan March 30.000 Nil 1998 to Ms.) payment allotment shares (Rs. 57.500 Nil 1998 to Ms.000 10 285 Cash Preferential allotment 5.500 137.150 46.000 10 10 Cash Preferential allotment 5.750 55.601.891. 414.000 153.750 49.) (Rs.K.911.626.600. Panjan March 30.050 10 10 Cash Preferential allotment 4.000 10 10 Cash Preferential allotment 5.750 50. 16. M. Ramachandran (HUF) March 27.700 46.950 2003 of debentures for Debentures Canzone Limited June 9. P. 414. 41. P. 10 sub-divided into 2 equity shares which have a face value of Rs. Ramachandran March 30.440 10 582. M.014.500 Nil 1998 to Mr. 58.000 49.155.949. 750 10 10 Cash Preferential allotment 4.101.957. Beena March 30.857. M.250 10 285 Cash Preferential allotment 5.750 2000 to Baring India Investments Limited November 22.513. Sujatha March 30. M.000 Nil 1998 to Mr.000 Nil 1998 to Ms. P. Jyothy March 30.518. 6. M. Sidharthan (HUF) March 30.187.450 10 10 Cash Preferential allotment 4.720.568. Divakaran March 30.000 41.500 Nil 1998 to Mr. of equity share equity share Date of equity share share Nature of Reason for equity capital premium allotment shares (Rs.842.284.000 56. Face Issue value price Cumulative per per Cumulative issued Cumulative No.500.500 Nil 1998 to Mr.101. K. R. M.150 46.200 49.950 a face value of Rs.206.417. 750 10 10 Cash Preferential allotment 4.42 Conversion Conversion of 6.) March 27. M.985. U. 60.550 2003 of debentures for CDC Debentures Financial Services (Mauritius) Limited November 22.450 10 10 Cash Preferential allotment 4. M. 190.250 49.880 72.550. 31. 828. Deepthy March 30.500 Nil 1999 to Mr.700 10 10 Cash Preferential allotment 4.689.985. of equity equity no.984. G. M. 29.850.618.568.417.760 72. P.541. 500.400 64. P. R.000 Nil 1998 to Ms.000 Nil 1997 to Mr. K.600 10 10 Cash Preferential allotment 4. P.42 Conversion Conversion of 6.000 Nil 1998 to Mr.

800 Nil 1997 R.880 888. D.353 5 years 13. Preferential Three 1998 allotment Cash 927.61% The lock-in shall start from the date of Allotment in the proposed Offer and the last date of the lock-in shall be three years from the date of Allotment in the Offer. M.733 1. In accordance with clause 4.000 Equity Shares and 50. Price per % of pre and Number of Equity post-Offer Date of Nature of Nature of Equity Share Lock-in paid up Name of Promoter allotment transaction payment Shares (Rs.) (Rs. 2.267 100 100 Cash Allotment to 17.500.000 Nil 1998 R. S. H.188 1. Ramachandran March 30.850.000 Equity Shares pursuant to a resolution of the shareholders at an EGM held on September 7.500 Nil 1997 I.16. Ramachandran March 27.2 Preference Share Capital History Cumulative Face value Issue price issued Cumulative per per Cumulative Preference Preference No.573.144.000 comprising 9. Parikh March 27.) March 27.500 1. 1.000 Preference Shares into Rs.565 100 100 Cash Allotment to 11. 2. M. of Share Share Date of Preference Share Share of Reason for Preference capital premium allotment Shares (Rs.) payment allotment Shares (Rs. The shares subject to lock-in have not been pledged with any bank or financial institution.096 100 100 Cash Allotment to 8. Subramanium March 27.743 100 100 Cash Allotment to 13. 3. the Equity Shares held by the Promoter may be transferred to and amongst the Promoter Group or to new promoters or persons in control of our Company 18 .318. P.1 (b) of the SEBI Guidelines. shall be locked in for a period of one year from the date of Allotment under this Offer. 100.39% Mr. K. We no longer have preference share capital.784 378. Mehta March 27. will not be disposed of.300 Nil 1997 S.000. Parikh March 27. The authorized share capital of our Company was then reclassified from Rs.) period capital Mr. Parikh The entire issued Preference Share capital of our Company was redeemed at face value pursuant to a resolution of the Board of Directors at a meeting held on March 15. sold or transferred by him during the period beginning on the date of filing this Draft Red Herring Prospectus with SEBI until the date the lock-in period described above commences.784 100 100 Cash Allotment to 3. V. 2002. 1.000 Nil 1997 H.975.6 of the SEBI Guidelines.000 1.400 Nil 1997 D. The entire pre-Offer capital. 2. of Preference Preference Nature no.) (Rs. 1. Mehta March 27.500 100 100 Cash Allotment to 18. 100.445 1.400 5 years 6.000 Nil 1997 Vaidhyanathan March 30. 5. D. Preferential Three 1997 allotment Cash 1.700.1.545 100 100 Cash Allotment to 15. the Promoter has given an undertaking that the Equity Shares forming part of the minimum Promoter’s contribution subject to the three year lock-in. other than those Equity Shares locked in as minimum Promoter’s contribution and those Equity Shares offered in the Offer for Sale. Promoter Contribution and Lock-in All Equity Shares being locked-in are eligible for computation of Promoter’s contribution and lock-in under clause 4.000.000. P. Further.000 comprising 10. 2002.

. . . . . . . Ramachandran . . . . . P. . . . . . . . . . . . . M. . . . . . . .660 2. . . . . . .780 3. . . . .46% 7. 226. . . . . M. . . . . . . . . . . . as applicable. . . 1. . . . .020 2. . . . . B. . . Ramachandran . 251. . . . .37% 9. . . . M. . . . . . . . . . . . . . . . . . Ms. . . . .63% 5. . . . . . . . the Equity Shares subject to lock-in will be transferable subject to compliance with the SEBI Guidelines. . . . . . . . . . . . . . . . . . . . .14 of the SEBI Guidelines subject to continuation of the lock-in in the hands of the transferees for the remainder of the lock-in period and compliance with SEBI (Substantial Acquisition of Shares and Takeovers) Regulations. . B. . In addition. . 1. . . . . . . . . . . . . . . . . . . . . the balance issued share capital of 7. . . . . . ICICI Bank Canada . . . . . . . . . . .600 3. . . . .71% 6. .subject to continuation of the lock-in in the hands of the transferees for the remainder of the lock-in period and compliance with SEBI (Substantial Acquisition of Shares and Takeovers) Regulations. In accordance with clause 4. . . . M. . . U. . . . Mr. . G. . . 553. . . . . . . . . . . . . . . . . . . . P.69% 10. . U. . . . P. . . . . . 3. . Santhakumari . . Mr. . . . . . . . Ms. . 782. . . .747 held by our shareholders shall be subject to a lock-in for a period of one year. . . Beena . . . . . . . . . . . . . . . . . . . . . . . . R. . .560 3. . . . .52% 19 .93% TOTAL 7. . . .330 2.24% 2. . .44% 3. . . . . . . . . .004. . Mr. . . . . . . . . . . . . . . . . CDC Investment Holdings Limited . . . . . . . . . . . . . . . 1997. . . . . . . . .16. 1. Canzone Limited . . . . . . . . . . . .130 5. . . . . . 344. 3. P.26% 3. . . . . . . . .630 96. . . . . . .00% 3.800 9. . . . . . .451. . P. . Jyothy .960 48. . M. . . . M. . . . . . . .001. . . . . . . . . . . . . . . . . . 453. . . .414. . . . . . 684.24% 2. . . Ramachandran (HUF) . . . .37% TOTAL 13. . . . . . . . . . . . Ms. . . . . . . . . . ICICI Bank UK PLC . M. . . . . Ms. . . Beena . . . . . 172. .782 7. . . Divakaran . . . . . . . . . . . Sidharthan . . . . . . . M. .220 92. . .500. . . . . 1997. . . . Divakaran . . as applicable. . . R. . . . 553. . . . . . . . . . . . . . . 140. . . . . . . CDC Investment Holdings Limited . .783 7. . . . . . . . . . . . . . . . . . . . . South Asia Regional Fund . Mr. Sidharthan . . 502. 391. . . . . .107. .13% 8. . . .066 2. . Jyothy . . . . . . . . . . . . .69% 9. . . . . . . .71% 6. . . . . . Mr.75% 4. . P. . . . . . . . . . . . . . . . . . . .980 48. . . . . . . . . . . . . . . . .2 Our top ten shareholders and the number of Equity Shares held by them as at two years prior to filing this Draft Red Herring Prospectus with SEBI are as follows: Pre-Offer percentage Shareholder No. . . . .565 15. . . Shareholding Pattern 3. . Mr. . . . . . . . . . . . . . . Additionally. .200 10. . .13% 8. .15% 10. . . . . . . . . . . of Equity Shares shareholding 1. . . . . .000 1. . . . . . . . . . South Asia Regional Fund .63% 4. . . . . . . . M.39% 5.46% 7. . . . . .180 4. 391.090 4. . . . . . . . .300 3.064 2. . . . . . . . . . . . . . . . 156. . . the Equity Shares held by persons other than the Promoter prior to the Offer may be transferred to any other person holding the Equity Shares that are locked-in under clause 4. . . . .1 (a) of the SEBI Guidelines. . .417. . 7. . . . . . Canzone Limited . . of Equity Shares shareholding 1. . . . . .1 Our top ten shareholders and the number of Equity Shares held by them as of the date of filing this Draft Red Herring Prospectus with SEBI and ten days prior to filing this Draft Red Herring Prospectus with SEBI are as follows: Pre-Offer percentage Shareholder No. Ms. 342. . . . P. . . . . Mr. . . . .180. . . . . . . . M. . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . .24% (2) Promoter Group Individuals . . . . . .001.001. . . . . therefore. . . . . . . . . . . . . . . . . . . . .20% Mr. . Ramachandran HUF. . . . . our Selling Shareholders. . .000 1.140 17. . . . . .960 48. . . . . . . . . . . . .24% Sub Total (1) . . . . . . K. . . . . . . . Ramachandran . Sidharthan HUF. . . . .500 69. . . . . . . . . . . .513. . . . . .513. 4. . . . . . .400 4. . .500 69. . . . . .414. . . . . .540 21.52% TOTAL SHARE CAPITAL (A+B+C) 14.08% 2. . . . . . . .760 100. . . . . . . 7. . . . . . . . . . . . . . . . . . K. . . 684.06% Mr. . . . . . . 9. . . . . .69% Nil Nil Sub Total B . . P. .000 1. . . . . . . . . . . .960 48. . . . .00% Nil Nil ICICI Bank UK PLC . .91% 6. . . . . . . . . . Our Company has not. . . . M.800 9. .200 10. . .560 3. . . M. . .13% Ms. . . . . . our Company will not receive any of the proceeds of the Offer. . . . U. 10. . . .4. . . .083. . . . . . Santhakumari . . . . . . . .15% Ms. . . . . Jyothy . . . .479. . . . . . . . . B. . . . . . . . . . . . . . . .260 30. . .400 1. . . . . . . . . . . . . . . . . . . .39% Nil Nil ICICI Bank Canada . . . . . 391. . . . . . . . . M. . . . of Equity Shares Shareholding Mr.93% Mr. . . . . . . . . . . .040 2. . . . . . . . . . . . our Directors nor the BRLMs have entered into any buy-back and/or standby arrangements for purchase of the Equity Shares from any person. M. .960 48. . . 1. . . . .37% Ms. . . . Deepthy . . As of the date of filing this Draft Red Herring Prospectus with SEBI. . . . . . . . . . . . . . . . . . . . . . . . . . P. . . . . . .066 2. . . . . .540 21. . other than as follows: Pre-Offer Percentage Shareholder No. . . .083. .48% 10. . raised any bridge loan against the proceeds of the Offer. . . 391. . . . Divakaran HUF and the M. . . . . P. . . . . . . . . . . . . . . . . . . . see the section titled “Our Promoter and Promoter Group” beginning on page 84 of this Draft Red Herring Prospectus. . . .180 4. . . . . . . . . . . .P. . . . . . . . . R. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Neither our Company.260 30. . .15% Sub Total (2) . . . . .081. . .760 100. . . . . . . . . .00% * Viz the M. . . . . . . . . . . . . . . . Sidharthan . . . P. . . . . . . . . . . . . .P. . . . . . . . . . . . . .46% Ms. . . Ramachandran (HUF) . . . Sidharthan (HUF) . . Divakaran (HUF) . . . . . . . . Beena . . P. .24% Ms. our Promoter. . . . .69% Nil Nil CDC Investment Holdings Limited . . . . . . The Offer is being made through the 100% Book Building Process wherein up to 50% of the Offer shall be available for allocation on a proportionate basis to QIBs. . . Ramachandran . . Public .71% Mr. . . . . . . . . P. . . . . . . . . . .001. . . .400 4.081. . . . . . . . . . . . . . Divakaran . . . . P. . . . . . . . . . . . . . . . . . .24% 7. . 174. . . . . . . . . . . . . . 190. . . . . . . . . . .660 2.48% B. . . . Shareholding pattern before and after the Offer The table below presents our shareholding pattern before the proposed Offer and as adjusted for the Offer: Equity Shares before Equity Shares after the Shareholder category the Offer Offer Number % Number % A. . 2. . . . . . .960 48. see the section titled “Our Management” beginning on page 74 of this Draft Red Herring Prospectus.15% 602. . . 453. . . . . . . . . . . . . . . . . . none of our Promoter. . . M. . . . . . . . . . . . . . . . . 280. .08% HUFs* . . . . . . .000 0. . . . . Directors or Key Management Personnel hold Equity Shares in our Company. . . . . . . . . 602. . . . Promoter Group. . . . . 8. . . . .75% Nil Nil South Asia Regional Fund . . . . . . . . . . . . . . . . . . . . . 1. 782. M. . . . . . . . 8. . . . . 5. . For details of the interests of our Promoter and Promoter Group. . out of which 5% shall be available for allocation 20 . . .479. . . . . . . . . . . . . 502. . . . 344. . . . . . . . . .24% 7. . .064 2.960 48.130 5. G. . . . . . . . . . . . . . . . . . . . . . . . . . . . .001. 3. As this is an Offer for Sale. . R. . . . 7. . . . . M. . . . . . . . the M. . 7. . .31% Mr. . . Institutional shareholders Canzone Limited . . . . . . .140 17. . . 132. . . .430. Sujatha .00%14. . M. . . 312. . . M. . . Promoter and Promoter Group (1) Promoter Mr. For details of interests of our Directors and Key Management Personnel. . . . . . . .23% 3. . . . . . . .451. M.430. 7.P. . . . . Nil Nil 4. . .23% Sub Total A = (1)+(2) . . . . . . . . . . . . . .001. . . . . .52% Nil Nil C. . . . .600 3. . . . . . . . . . .100 0. . . . . . . . . . . . . . . . .

FIIs. subject to valid Bids being received from them at or above the Offer Price. seeking approval for transfer of Equity Shares in this Offer to eligible NRIs. Further. A Bidder cannot make a Bid for more than the number of Equity Shares offered in this Offer. we may issue Equity Shares pursuant to an employee stock option plan or issue Equity Shares or securities linked to Equity Shares to finance an acquisition. There are no outstanding warrants. As per the RBI regulations. options or rights to convert debentures. subject to the maximum limit of investment prescribed under relevant laws applicable to each category of investor. 18. However. 10. rights issue or in any other manner during the period commencing from filing the Draft Red Herring Prospectus with SEBI until the Equity Shares offered under the Offer have been listed. 21 . merger or joint venture. We will have only one denomination of the Equity Shares unless otherwise permitted by law and shall comply with such disclosure and accounting norms as may be specified by SEBI from time to time. or for regulatory compliance or such other scheme of arrangement if an opportunity of such nature is determined by our Board to be in our interest. preferential allotment. We have not issued any Equity Shares out of revaluation reserves or for consideration other than cash except as stated in the section titled “Capital Structure—Notes to Capital Structure—Equity Share Capital History” on page 15 of this Draft Red Herring Prospectus. at least 15% of the Offer will be available for allocation on a proportionate basis to Non-Institutional Bidders and at least 35% of the Offer will be available for allocation on a proportionate basis to Retail Individual Bidders. we do not have any intention or proposal to alter capital structure for a period of six months commencing from the Bid/Offer Opening Date. 11. 16. 15. subject to valid Bids being received at or above the Offer Price. loans or other financial instruments into Equity Shares. merger or joint venture by us or as consideration for such acquisition. We have filed an application with the RBI pursuant to our letter dated [Š]. 12. Presently. during such period or at a later date. We have not issued any Equity Shares in the last six months and there have not been any transfers of Equity Shares between our Promoter and the Promoter Group in the six months preceding the date of filing this Draft Red Herring Prospectus. 17. As of June 28. on a proportionate basis to Mutual Funds only. None of the Equity Shares held by our Promoter are subject to any pledge. by way of split/consolidation of the denomination of Equity Shares or further issue of Equity Shares or securities convertible into Equity Shares. we had 16 members. whether on a preferential basis or otherwise. There would be no further issue of capital whether by way of issue of bonus shares. OCBs are not permitted to participate in the Offer. 14. 2007. The remainder shall be available for allocation on a proportionate basis to QIBs and Mutual Funds. foreign venture capital investors registered with SEBI and multilateral and bilateral development financial institution on a repatriation basis at an offer price discovered through the SEBI regulated process of book building. 13.

260 Equity Shares by our Selling Shareholders.430. 22 . It will provide a public market for our Equity Shares in India. We believe that listing will enhance our brand name and provide liquidity to our existing shareholders. OBJECTS OF THE OFFER The objects of the Offer are to achieve the benefits of listing our Equity Shares on the Stock Exchanges and to carry out the divestment of 4. We will not receive any proceeds from the Offer.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63. . . . . . . . . the P/E ratio is Rs. . . . . .) Weight 15 months ended June 30. . . . . . . . .09 Price/Earning (P/E) ratio in relation to Price Band 1. . . . . . . . . . . . . . . . . . . The information relating to the Company’s share capital in this chapter is based on a face value of Rs.61. . . . . . . . . . . . . . . .53) 1 FY 2005 . . . . . . . . . . . . . . . . . . . . . . 41. . . . . . . . . . . . . . . . .1 (Source: Capital Market-Vol XXII/07 June 04-17. . . . . . . . . . . . . Based on the EPS of Rs. . the P/E ratio is Rs. . . . . . . on the basis of the assessment of market demand for the offered Equity Shares by the Book Building Process.09. . . 2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . [Š]. . . . . . . . . . . . .08 Minimum Return on post-Offer Net Worth required to maintain pre-Offer EPS is [Š]%. . . . .1 Lowest . . . . . . . Net Asset Value per Equity Share after the Offer is Rs. . . . . . 5 each and the Floor Price is [Š] times of the face value and the Cap Price is [Š] times of the face value. . . . . . . . . . . . BASIS FOR OFFER PRICE The Price Band for the Offer shall be decided prior to the filing of the Red Herring Prospectus with the RoC. . . . . . . . 18. . . . . . . . . . . . Based on the weighted average EPS of Rs. . . . . . . . . . . . . . . . . . [Š] at the Floor Price and Rs. . . . . . . . .88 2 FY 2006 . . . . . . 10 per equity share. . . Net Asset Value per Equity Share 1. . . . . . . . . . . . . . . 63. . 41. . . . . . . . . . . . . . . . . . . .72 2 FY 2006 . . . . . . . . . . . . . . (11. . . . 23 . . . . . [Š] at the Cap Price. . . . . . . . . . . . . . . 3. P/E ratio for the industry is as follows: Particulars Industry Highest . . . . . . . . . . . . . . . .87 3 WEIGHTED AVERAGE . . [Š] at the Cap Price. . . . . . . . . . . . . . . . . . . . . . . . Net Asset Value per Equity Share as of June 30. . . . . — Industry composite . . 2006 is Rs. . . . Qualitative Factors For some of the qualitative factors which form the basis for computing the price please see the sections titled “Business” and “Risk Factors” beginning on page 45 and page x respectively of this Draft Red Herring Prospectus. . . . . 2004 . . 2004 . . . . . . . . Quantitative Factors Information presented in this section is derived from our restated unconsolidated financial statements prepared in accordance with Indian GAAP. . . . 44. . . Earning Per Share (EPS) EPS Particulars (Rs. 34. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (34. in consultation with the BRLMs. . . . . . . . 29. . . . . 12. . . . . . . . . . . . . . . . . . . . . . . . . .95) 1 FY 2005 . . . . . . . . . . . . . . . . 3. . . . . . . . . 2007) Return on Net Worth Particulars Return on Net Worth (%) Weight 15 months ended June 30. . . . . . . . . .87 for FY 2006. 350. . . . . . . 14. . The face value of our Equity Shares is Rs. . . . . . The Offer Price will be determined by our Company and the Selling Shareholders. . . . . . . . . . . . . . . . .22 3 WEIGHTED AVERAGE . [Š] at the Floor Price and Rs.

.9 34. . . . . . . . . . . Marico Limited. . . . 2007.7 23. . . . . 10 63. . Dabur India Limited.Figures are based on audited results for the year ended March 31. . . .Figures are based on unaudited results for the year ended March 31. . . . The Floor Price is [Š] times of the face value of the Equity Shares and the Cap Price is [Š] times of the face value of the Equity Shares.8 (Source: Capital Market-Vol XXII/07 June 4-17. .5 15. . . .) ratio (%) (Rs. . 1 5. . . . . Godrej Consumer Products Limited. inter alia. . . . 2006 and market price as on May 28. . . . . . Emami Limited. . . . .1 48. 5 each. 2007. . . . . . . . 2007. . . . . .9 3. . . . .61 Peer Group: Marico Limited . . . . . . . . . . . . .2 39. . . [Š] is justified in view of the above qualitative and quantitative parameters. . 2007) Notes: 1. .Comparison of Accounting Ratios Return NAV Face Value on Net per per share EPS P/E Worth share (Rs. . 2007 and market price as on May 28. . . . . . . . . . . . 1 1. . . . . . . . 2 7. .) Jyothy Laboratories Limited . . . . 2007 and market price as on May 28. . . . . . . . . . respectively. . .9 Dabur India Limited .4 26. The Company has on June 9. 4. . . 2. . . 3. 2006. . . [Š] to Rs. . . . important information the risks associated with this Offer and the profitability and return ratios. . . The BRLMs believe that the Price Range of Rs. .87 [Š] 18. 5. . . 2007. . . . . .) (Rs. . . . . . . 2007 split the face value of its equity shares from Rs. . . .Figures are based on restated accounts for the year ended June 30. .Figures are based on audited results for the year ended March 31. . . 10 to Rs. .1 56. . . . . . . 2006 and market price as on May 28. . See the sections titled “Risk Factors” and “Financial Statements” beginning on pages x and 97 of this Draft Red Herring Prospectus for.9 — 4. .22 350. .0 Godrej Consumer Products Limited . .1 4. . . . 24 . . .9 30. . .Figures are based on audited results for the year ended March 31. . 1 2. . . . . . .7 Emami Limited . Jyothy Laboratories Limited. . . . . .

1961 and the Wealth Tax Act. the conditions prescribed for availing the benefits have been / would be met with. Board of Directors. We do not express any opinion or provide any assurance as to whether: i.400 059. Batliboi & Associates Chartered Accountants Per Sudhir Soni Partner Membership No: 41870 Place: Mumbai Date: June 6. 1957. Shiv-shakti Industrial Estate. the Company or its shareholders will continue to obtain these benefits in future. 1961 and Indirect tax laws. The contents of the enclosed statement are based on information. STATEMENT OF GENERAL TAX BENEFITS To. which based on business imperatives the Company faces in the future. Mumbai . the Company may or may not choose to fulfill. 2007 25 . This statement is only intended to provide general information to the investors and is neither designed nor intended to be a substitute for professional tax advice. each investor is advised to consult his or her own tax consultant with respect to the specific tax implications arising out of their participation in the issue. Marol. The benefits discussed in the enclosed statement are not exhaustive and the preparation of the contents stated is the responsibility of the Company’s management. explanations and representations obtained from the Company and on the basis of our understanding of the business activities and operations of the Company. the ability of the Company or its shareholders to derive the tax benefits is dependent upon fulfilling such conditions. presently in force in India. Dear Sirs. In view of the individual nature of the tax consequences and the changing tax laws. or ii.R. presently in force in India and to the shareholders of the Company under the Income tax Act. Several of these benefits are dependent on the Company or its shareholders fulfilling the conditions prescribed under the relevant provisions of the statute. Jyothy Laboratories Limited 43. Statement of Possible Tax Benefits available to the Company and its shareholders We hereby report that the enclosed statement states the possible tax benefits available to the Company under the Income tax Act. Andhri-Kurla Road. Andheri (East). Hence. For S.

As per the provisions of section 48 of the Act. long term capital gain arising to the company from transfer of a long term capital asset being an equity share in a company listed on a recognized stock exchange in India. 2. the amount of capital gain shall be computed by deducting from the sale consideration. The indexed cost of acquisition/ improvement. as prescribed from time to time. The company in the past. and the transaction is chargeable to Securities Transaction Tax (‘STT’). has claimed deduction under section 80-IB and is eligible to claim this deduction for the following prospective years in respect of the industrial undertakings mentioned below: 100% exemption 30% exemption Location of Industrial Undertaking Product Manufactured upto financial year up to financial year Guwahati Fabric whitener — 2009-10 Guwahati Mosquito repellants 2006-07 2011-12 Daman and Diu Fabric whitener — 2008-09 Himachal Pradesh Fabric whitener 2006-07 2011-12 Pondichery Dishwash bar and ayurvedic soaps 2006-07 2011-12 Bankura (West Bengal) Fabric whitener — 2008-09 Wayanad (Kerala) Fabric whitener — 2010-11 Mahbubnagar (Andhra Pradesh) Fabric whitener — 2006-07 The company has also set up a manufacturing unit in (Himachal Pradesh) for manufacture of Fabric whitners. the cost of acquisition and expenses incurred in connection with the transfer of a capital asset. Shares held in a company or any other security listed in a recognised stock exchange in India or UTI or Mutual Fund units specified under section 10(23D) of the Act and zero coupon bonds are considered as long-term capital assets. All capital assets [except shares held in a company or any other security listed in a recognised stock exchange in India or units of Unit Trust of India (‘UTI’) or Mutual Fund units specified under section 10(23D) of the Act and zero coupon bonds] are considered to be long-term capital assets. if they are held for a period exceeding thirty-six months. As per the provisions of section 10(38) of the Act. shall be exempt from tax. Deduction under section 80-IB and 80-IC of the Act The company has set up various manufacturing units (industrial undertakings) for the manufacture of fabric whiteners. if these are held for a period exceeding twelve months. dishwash bar and ayurvedic soaps in the backward states and backward districts specified in the Eighth Schedule to the Act and as notified by the Central Government respectively. The profits and gains derived by the company in each of these industrial undertakings are eligible for deduction under section 80-IB of the Act. long-term capital gains [other than those covered under section 10(38) of the Act] are subject to tax at a rate of 20% (plus applicable surcharge and cess). 3. 2004. However. in respect of long-term capital gains arising to the company. 26 . As per the provisions of section 112 of the Act. The profit derived by the company from this undertaking is eligible for deduction under section 80-IC of the Act (100% upto financial year 2009-10 and 30% upto financial year 2014-15). Computation of capital gains Capital assets are to be categorised into short-term capital assets and long-term capital assets based on the period of holding. if such sale is entered into on or after October 1. mosquito repellants. Dividend (whether interim or final) received by the company from its investment in shares of another domestic company would be exempted in the hands of the company as per the provisions of section 10(34) read with section 115-O of the Act.ANNEXURE TO STATEMENT OF POSSIBLE TAX BENEFITS AVAILABLE TO JYOTHY LABORATORIES LIMITED AND ITS SHAREHOLDERS (A) Benefits to Jyothy Laboratories Limited (‘the company’) under Income-tax Act. Dividends exempt under section 10(34) and 10(35) of the Act. a benefit is permitted to substitute the cost of acquisition/ improvement with the indexed cost of acquisition/ improvement. However. 1961 (‘the Act’) 1. adjusts the cost of acquisition/ improvement by a cost inflation index.

2004 and the transaction is chargeable to STT. The bonds specified for this section are bonds issued on or after April 1. calculated at the rate of 27 . Computation of capital gains Capital assets are to be categorised into short-term capital assets and long-term capital assets based on the period of holding. short term capital gains arising from transfer of short term capital asset. being an equity share in a company or a unit of an equity oriented mutual fund shall be taxable at the rate of 10% (plus applicable surcharge and education cess). a benefit is permitted to substitute the cost of acquisition/ improvement with the indexed cost of acquisition/ improvement. 4. long-term capital gains [other than those covered under section 10(38) of the Act] are subject to tax at a rate of 20% (plus applicable surcharge and cess). the cost of acquisition and expenses incurred in connection with the transfer of a capital asset.proviso to section 112(1) specifies that if the long-term capital gains [other than those covered under section 10(38) of the Act] arising on transfer of listed securities or units or zero coupon bond. proviso to section 112(1) specifies that if the long-term capital gains [other than those covered under section 10(38) of the Act] arising on transfer of listed securities or units or zero coupon bond. The indexed cost of acquisition/ improvement. Shares held in a company or any other security listed in a recognised stock exchange in India or units of UTI or Mutual Fund units specified under section 10(23D) of the Act and zero coupon bonds are considered as long-term capital assets. long term capital gain arising to a resident shareholder from transfer of a long term capital asset being an equity share in a company listed on a recognized stock exchange in India. calculated at the rate of 20% with indexation benefit exceeds the capital gains computed at the rate of 10% without indexation benefit. shall be exempt from tax. and the transaction is chargeable to STT. Dividends exempt under section 10(34) of the Act Dividend (whether interim or final) received by a resident shareholder from its investment in shares of a domestic company would be exempt in the hands of the resident shareholder as per the provisions of section 10(34) read with section 115-O of the Act. As per the provisions of section 112 of the Act. As per provisions of section 111A of the Act. the amount of capital gain shall be computed by deducting from the sale consideration. 2004. the amount of capital gains exempted earlier would become chargeable in such year. if such sale is entered into on or after October 1. As per the provisions of section 10(38) of the Act. Exemption of capital gain from income-tax As per the provisions of section 54EC of the Act and subject to the conditions specified therein capital gains arising to the company on transfer of a long-term capital asset [other than those covered under section 10(38) of the Act] shall not be chargeable to tax to the extent such capital gains are invested in certain notified bonds within six months from the date of transfer. However. if these are held for a period exceeding twelve months. If only part of such capital gain is invested. if such sale is entered into on or after October 1. (B) Benefits to the Resident shareholders 1. As per the provisions of section 48 of the Act. if they are held for a period exceeding thirty-six months. the exemption shall be proportionately reduced. if the company transfers or converts the notified bonds into money (as stipulated therein) within a period of three years from the date of their acquisition. as prescribed from time to time. in respect of long-term capital gains arising to a resident shareholder. However. then such capital gains are chargeable to tax at the rate of 10% without indexation benefit (plus applicable surcharge and education cess). However. 2006 by the National Highways Authority of India (‘NHAI’) and by the Rural Electrification Corporation Ltd. 2. The Finance Act 2007 has restricted the maximum investment in such bonds upto Rs 50 lacs per assessee during any financial year. All capital assets [except shares held in a company or any other security listed in a recognised stock exchange in India or units of UTI or Mutual Fund units specified under section 10(23D) of the Act and zero coupon bonds] are considered to be long-term capital assets. (‘REC’). adjusts the cost of acquisition/ improvement by a cost inflation index.

20% with indexation benefit exceeds the capital gains computed at the rate of 10% without indexation benefit,
then such capital gains are chargeable to tax at the rate of 10% without indexation benefit (plus applicable
surcharge and education cess).

As per provisions of section 111A of the Act, short term capital gains arising from transfer of short term
capital asset, being an equity share in a company or a unit of an equity oriented mutual fund shall be taxable @
10% (plus applicable surcharge and education cess), if such sale is entered into on or after October 1, 2004 and
the transaction is chargeable to STT.

3. Exemption of capital gains arising from income tax
As per the provisions of section 54EC of the Act and subject to the conditions specified therein capital gains
arising to a resident shareholder on transfer of a long-term capital asset [other than those covered under section
10(38) of the Act] shall not be chargeable to tax to the extent such capital gains are invested in certain notified
bonds within six months from the date of transfer. If only part of such capital gain is invested, the exemption
shall be proportionately reduced.

However, if the resident shareholder transfers or converts the notified bonds into money (as stipulated
therein) within a period of three years from the date of their acquisition, the amount of capital gains exempted
earlier would become chargeable in such year. The bonds specified for this section are bonds issued on or after
April 1, 2006 by NHAI and REC. The Finance Act 2007 has restricted the maximum investment in such bonds
upto Rs 50 lacs per assessee during any financial year.

Further, as per the provisions of section 54F of the Act and subject to conditions specified therein, long-term
capital gains [other than a capital gains arising on sale of residential house and those covered under section
10(38) of the Act] arising to an individual or Hindu Undivided Family (‘HUF’) on transfer of shares of the
company will be exempted from capital gains tax, if the net consideration from such shares are used for either
purchase of residential house property within a period of one year before or two years after the date on which the
transfer took place, or for construction of residential house property within a period of three years after the date
of transfer.

4. Rebate under section 88E
As per the provisions of section 88E, where the business income of a resident shareholder includes profits
and gains from sale of taxable securities, a rebate shall be allowed from the amount of income tax, equal to the
securities transaction tax paid on such transactions. However, the amount of rebate shall be limited to the amount
arrived at by applying the average rate of income tax on such business income.

(C) Benefits to the Non-resident shareholders
1. Dividends exempt under section 10(34) of the Act
Dividend (whether interim or final) received by a non-resident shareholder from its investment in shares of a
domestic company would be exempt in the hands of the non-resident shareholder as per the provisions of section
10(34) read with section 115-O of the Act.

2. Computation of capital gains
Capital assets are to be categorised into short-term capital assets and long-term capital assets based on the
period of holding. All capital assets [except shares held in a company or any other security listed in a recognised
stock exchange in India or units of UTI or Mutual Fund units specified under section 10(23D) of the Act and zero
coupon bonds] are considered to be long-term capital assets, if they are held for a period exceeding thirty-six
months. Shares held in a company or any other security listed in a recognised stock exchange in India or units of
UTI or Mutual Fund units specified under section 10(23D) of the Act and zero coupon bonds are considered as
long-term capital assets, if these are held for a period exceeding twelve months.

As per the proviso of section 48 of the Act, the amount of capital gain shall be computed by deducting from
the sale consideration, the cost of acquisition and expenses incurred in connection with the transfer of a capital
asset. However in respect of long-term capital gains (other than those covered under second proviso to

28

section 48) arising to the non-resident shareholder, a benefit is permitted to substitute the cost of acquisition/
improvement with the indexed cost of acquisition/ improvement. The indexed cost of acquisition/ improvement,
adjusts the cost of acquisition/ improvement by a cost inflation index, as prescribed from time to time.
As per the second provisions of section 48 of the Act, the capital gains arising on transfer of capital asset
being shares or debentures of an Indian company, (purchased in foreign currency) needs to be computed by
converting the cost of acquisition, expenditure in connection with such transfer and full value of consideration
received or accruing as a result of the transfer into the same foreign currency in which the shares were originally
purchased. The resultant gains thereafter need to be reconverted into Indian currency. The conversion needs to be
done at the prescribed rates prevailing on dates stipulated. Hence, in computing such gains, the benefit of
indexation is not available to non-resident shareholders.
As per the provisions of section 10(38) of the Act, long term capital gain arising to a non-resident
shareholder from transfer of a long term capital asset being an equity share in a company listed on a recognized
stock exchange in India, shall be exempt from tax, if such sale is entered into on or after October 1, 2004, and the
transaction is chargeable to STT.
As per the provisions of section 112 of the Act, long-term capital gains (other than those covered under
section 10(38) of the Act) are subject to tax at a rate of 20% (plus applicable surcharge and cess). However,
proviso to section 112(1) specifies that if the long-term capital gains [other than those covered under second
proviso to section 48 and under section 10(38) of the Act] arising on transfer of listed securities or units or zero
coupon bond, calculated at the rate of 20% with indexation benefit exceeds the capital gains computed at the rate
of 10% without indexation benefit, then such capital gains are chargeable to tax at the rate of 10% without
indexation benefit (plus applicable surcharge and education cess).
As per provisions of section 111A of the Act, short term capital gains arising from transfer of short term
capital asset, being an equity share in a company or a unit of an equity oriented mutual fund shall be taxable
@ 10% (plus applicable surcharge and education cess), if such sale is entered into on or after October 1, 2004
and the transaction is chargeable to STT.

3. Exemption of capital gain from income-tax
As per the provisions of section 54EC of the Act and subject to the conditions specified therein capital gains
arising to a non-resident shareholder on transfer of a long-term capital asset [other than those covered under
section 10(38) of the Act] shall not be chargeable to tax to the extent such capital gains are invested in certain
notified bonds within six months from the date of transfer. If only part of such capital gain is invested, the
exemption shall be proportionately reduced.
However, if the non-resident shareholder transfers or converts the notified bonds into money (as stipulated
therein) within a period of three years from the date of their acquisition, the amount of capital gains exempted
earlier would become chargeable in such year. The bonds specified for this section are bonds issued on or after
April 1, 2006 by NHAI and REC. The Finance Act 2007 has restricted the maximum investment in such bonds
upto Rs 50 lacs per assessee during any financial year.
Further, as per the provisions of section 54F of the Act and subject to conditions specified therein, long-term
capital gains [other than a capital gains arising on sale of residential house and those covered under section
10(38) of the Act] arising to an individual or HUF on transfer of shares of the company will be exempted from
capital gains tax, if the net consideration from such shares are used for either purchase of residential house
property (subject to prior approval from Reserve Bank of India) within a period of one year before or two years
after the date on which the transfer took place, or for construction of residential house property within a period of
three years after the date of transfer.

4. Rebate under section 88E
As per the provisions of section 88E, where the business income of a non-resident shareholder includes
profits and gains from sale of taxable securities, a rebate shall be allowed from the amount of income tax, equal
to the securities transaction tax paid on such transactions. However, the amount of rebate shall be limited to the
amount arrived at by applying the average rate of income tax on such business income.

5. Tax Treaty Benefits
As per section 90(2) of the Act, the provisions of the Act would prevail over the provisions of the tax treaty
to the extent they are more beneficial to the non-resident shareholder. Thus, a non-resident shareholder can opt to
be governed by the beneficial provisions of an applicable tax treaty.

29

(D) Benefits to the Non-resident Indian shareholders
1. Dividends exempt under section 10(34) of the Act
Dividend (whether interim or final) received by a Non-Resident Indian (‘NRI’) shareholder from its
investment in shares of a domestic company would be exempt in the hands of the NRI shareholder company as
per the provisions of section 10(34) read with section 115-O of the Act.

2. Computation of capital gains
Capital assets are to be categorised into short-term capital assets and long-term capital assets based on the
period of holding. All capital assets [except shares held in a company or any other security listed in a recognised
stock exchange in India or units of UTI or Mutual Fund units specified under section 10(23D) of the Act and zero
coupon bonds] are considered to be long-term capital assets, if they are held for a period exceeding thirty-six
months. Shares held in a company or any other security listed in a recognised stock exchange in India or units of
UTI or Mutual Fund units specified under section 10(23D) of the Act and zero coupon bonds are considered as
long-term capital assets, if these are held for a period exceeding twelve months.

As per the provisions of section 48 of the Act, the amount of capital gain shall be computed by deducting
from the sale consideration, the cost of acquisition and expenses incurred in connection with the transfer of a
capital asset. However, in respect of long-term capital gains [other than those covered under section 10(38) of the
Act and capital gains covered by the provisions of Chapter XII-A] arising to the NRI, a benefit is permitted to
substitute the cost of acquisition/ improvement with the indexed cost of acquisition/ improvement. The indexed
cost of acquisition/ improvement, adjusts the cost of acquisition/ improvement by a cost inflation index, as
prescribed from time to time.

As per the provisions of section 10(38) of the Act, long term capital gain arising to an NRI from transfer of
a long term capital asset being an equity share in a company listed on a recognized stock exchange in India, shall
be exempt from tax, if such sale is entered into on or after October 1, 2004, and the transaction is chargeable to
STT.

As per the provisions of section 112 of the Act, long-term capital gains [other than those covered under
section 10(38) of the Act and capital gains covered by the provisions of Chapter XII-A] are subject to tax at a rate
of 20% (plus applicable surcharge and cess). However, proviso to section 112(1) specifies that if the long-term
capital gains [other than those covered under section 10(38) of the Act and capital gains covered by the
provisions of Chapter XII-A] arising on transfer of listed securities or units or zero coupon bond, calculated at
the rate of 20% with indexation benefit exceeds the capital gains computed at the rate of 10% without indexation
benefit, then such capital gains are chargeable to tax at the rate of 10% without indexation benefit (plus
applicable surcharge and education cess).

As per provisions of section 111A of the Act, short term capital gains arising from transfer of short term
capital asset, being an equity share in a company or a unit of an equity oriented mutual fund shall be taxable at
the rate of 10% (plus applicable surcharge and education cess), if such sale is entered into on or after October 1,
2004 and the transaction is chargeable to STT.

As per the provisions of section 115-I of the Act, an NRI as defined therein has the option to be governed by
the normal provisions of the Act or the provisions of Chapter XII-A of the Act through appropriate declaration in
the return of income. The said Chapter inter alia entitles an NRI to the benefits stated hereunder in respect of
income from shares of an Indian company acquired, purchased or subscribed in convertible foreign exchange.

As per the provisions of section 115D read with section 115E of the Act, where shares in the company are
acquired or subscribed to in convertible foreign exchange by an NRI, long term capital gains [other than those
covered under section 10(38) of the Act] arising to him on transfer of shares, shall be concessionally taxed at the
flat rate of 10% (plus applicable surcharge and cess) without indexation benefit but with protection against
foreign exchange fluctuation.

As per the provisions of section 115F of the Act, long-term capital gains [other than those covered under
section 10(38) of the Act] arising to an NRI from the transfer of shares of the company subscribed to in
convertible foreign exchange shall be exempt from Income tax, if the net consideration is reinvested in specified
assets or savings certificates referred to in section 10(4B) of the Act within six months of the date of transfer. If
only part of the net consideration is so reinvested, the exemption shall be proportionately reduced. The amount so
exempted shall be chargeable to tax subsequently, if the specified assets are transferred or converted into money
within three years from the date of their acquisition.

30

As per the provisions of section 115G of the Act, an NRI is not required to file a return of income under
section 139(1) of the Act, if his only source of income is investment income or long term capital gains or both
arising out of the assets acquired, purchased or subscribed in convertible foreign exchange and tax has been
deducted at source from such income as per the provisions of Chapter XVII-B of the Act.

As per the provision of section 115H of the Act, when an NRI becomes assessable as a resident in India, the
provisions of the Chapter XII-A can continue to apply in relation to investment made when he was an NRI.
Towards this, the NRI needs to furnish a declaration in writing to the Assessing Officer along with his return of
income.

3. Exemption of capital gain from income-tax
As per the provisions of section 54EC of the Act and subject to the conditions specified therein capital gains
arising to an NRI shareholder on transfer of a long-term capital asset [other than those covered under section
10(38) of the Act and capital gains covered by the provisions of Chapter XII-A] shall not be chargeable to tax to
the extent such capital gains are invested in certain notified bonds within six months from the date of transfer. If
only part of such capital gain is invested, the exemption shall be proportionately reduced.

However, if the NRI shareholder transfers or converts the notified bonds into money (as stipulated therein)
within a period of three years from the date of their acquisition, the amount of capital gains exempted earlier
would become chargeable in such year. The bonds specified for this section are bonds issued on or after April 1,
2006 by NHAI and REC. The Finance Act 2007 has restricted the maximum investment in such bonds upto Rs
50 lacs per assessee during any financial year.

Further, as per the provisions of section 54F of the Act and subject to conditions specified therein, long-term
capital gains [other than capital gains arising on sale of residential house and other than those covered under
section 10(38) of the Act] arising to an individual or HUF on transfer of shares of the company will be exempted
from capital gains tax, if the net consideration from such shares are used for either purchase of residential house
property within a period of one year before or two years after the date on which the transfer took place, or for
construction of residential house property within a period of three years after the date of transfer.

4. Rebate under section 88E
As per the provisions of section 88E, where the business income of an NRI shareholder includes profits and
gains from sale of taxable securities, a rebate shall be allowed from the amount of income tax, equal to the
securities transaction tax paid on such transactions. However the amount of rebate shall be limited to the amount
arrived at by applying the average rate of income tax on such business income.

5. Tax Treaty Benefits
As per section 90(2) of the Act, the provisions of the Act would prevail over the provisions of the tax treaty
to the extent they are more beneficial to the NRI shareholder. Thus, an NRI shareholder can opt to be governed
by provisions of the Act or the applicable tax treaty whichever is more beneficial.

(E) Benefits to the Foreign Institutional Investor (‘FII’)
1. Dividends exempt under section 10(34) of the Act
Dividend (whether interim or final) received by a FII from its investment in shares of a domestic company
would be exempt in the hands of the FII as per the provisions of section 10(34) read with section 115-O of the
Act.

2. Long term capital gains exempt under section 10(38) of the Act.
As per the provisions of section 10(38) of the Act, long term capital gain arising to the FII from transfer of a
long term capital asset being an equity share in a company listed on a recognized stock exchange in India, shall
be exempt from tax, if such sale is entered into on or after October 1, 2004, and the transaction is chargeable to
STT.

31

3. Capital gains
As per the provisions of section 115AD of the Act, FIIs are taxed on the capital gains income at the
following rates:
Rate of tax
Nature of Income (%)*

Long-term capital gains . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Short-term capital gains . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
* Plus applicable surcharge and cess

The benefits of foreign currency fluctuation protection and indexation as provided by section 48 of the Act
are not available to a FII.

As per the provisions of section 10(38) of the Act, long term capital gain arising to FII from transfer of a
long term capital asset being an equity share in a company listed on a recognized stock exchange in India, shall
be exempt from tax, if such sale is entered into on or after October 1, 2004, and the transaction is chargeable to
STT.

As per provisions of section 111A of the Act, short term capital gains arising from transfer of short term
capital asset, being an equity share in a company or a unit of an equity oriented mutual fund shall be taxable at
the rate of 10% (plus applicable surcharge and education cess), if such sale is entered into on or after October 1,
2004 and is chargeable to STT.

4. Tax Treaty Benefits
As per section 90(2) of the Act, the provisions of the Act would prevail over the provisions of the tax treaty
to the extent they are more beneficial to the FII. Thus, an FII can opt to be governed by provisions of the Act or
the applicable tax treaty whichever is more beneficial.

(F) Benefits to the Mutual Funds
1. Dividends exempt under section 10(34) of the Act
Dividend (whether interim or final) received by a Mutual Fund from its investment in shares of a domestic
company would be exempt in the hands of the Mutual Fund as per the provisions of section 10(34) read with
section 115-O of the Act.

2. As per the provisions of section 10(23D) of the Act, any income of Mutual Funds registered under the
Securities and Exchange Board of India Act, 1992 (‘SEBI’) or regulations made thereunder, Mutual Funds
set up by public sector banks or public financial institutions or Mutual Funds authorised by the Reserve
Bank of India, would be exempt from income tax, subject to the prescribed conditions.

(G) Benefits to the Venture Capital Companies / Funds
1. Dividends exempt under section 10(34) of the Act
Dividend (whether interim or final) received by a Venture Capital Company (‘VCC’)/ Venture Capital
Funds (‘VCF’) from its investment in shares of another domestic company would be exempt in the hands of the
VCC/VCF as per the provisions of section 10(34) read with section 115-O of the Act.

2. Income exempt under section 10(23FB) of the Act
As per the provisions of section 10(23FB) of the Act, any income of VCC/VCF registered with the SEBI, set
up to raise funds for investment in a venture capital undertaking (‘VCU’) would be exempt from income tax,
subject to the conditions specified. The Finance Act 2007 has restricted the definition of venture capital
undertaking (‘VCU’) to mean such domestic company whose shares are not listed on a recognized stock
exchange in India and which is engaged in the following specified business viz:
• Nanotechnology;
• Information technology relating to hardware and software;
• Seed research and development;

32

• Bio-technology;
• Research and development of new chemical entities in the pharmaceutical sector;
• Production of bio-fuels;
• Building and operating composite hotel-cum-convention centre with seating capacity of more than
3,000;
• Developing or operating and maintaining or developing, operating and maintaining any infrastructure
facility as defined in Explanation to clause (i) of sub-section (4) of section 80-IA and
• Dairy or poultry industry.

Further, the Finance Act 2007 has exempted all the income received by a VCC or a VCF from investment in
VCU.

(H) Benefits available under the Wealth-tax Act, 1957 (Common to all)
Asset as defined under section 2(ea) of the Wealth-tax Act, 1957 does not include shares in companies and
hence, shares are not liable to wealth tax.

(I) Benefits available to the Company under Value Added Tax (‘VAT’) / Sales Tax legislation:
In accordance with the provisions of the respective state Sales tax / VAT legislations, the Company would
be entitled to the following benefits:

Andhra Pradesh
The Company was entitled for tax exemption from the sales tax / VAT payable on sales of ‘Ujala Supreme’
in the state of Andhra Pradesh upto Rs. 11.24 million for a period of 7 years from November 2, 2001 to
November 1, 2008 vide Eligibility certificate No 30/3/2002/0148/0148/ID dated December 5, 2002 issued by the
Commissioner of Industries. However, the said exemption was converted into deferment as per the section 69 of
Andhra Pradesh Value Added Tax Act, 2005 (‘APVAT’) with effect from April 1, 2005.

Consequently, the Company was entitled to exemption from sales tax upto March 31, 2005 and it would be
entitled to defer the sales tax / VAT payable from April 1, 2005 to May 1, 2012. The sales tax / VAT payable and
the tax to be claimed as deferment for each period would be the net tax (i.e. output tax less input tax). The
amount of deferment availed for each month would be payable back to the government at the end of fourteen
years.

Assam
The Company would be entitled to an exemption upto 99 percent of the sales tax / VAT payable on sales of
‘MAXO—Mosquito Coil’ manufactured and sold in Assam upto Rs 46.84 million for a period of ten years from
July 2002 to July 2012 vide Eligibility Certificate No AIDC/US/ECST/245/99/18 dated June 22, 2003 issued
under the Industrial Policy of Assam, 1997.

Kerala
The Company would be entitled to exemption from the sales tax/ VAT payable on sales of ‘Washing Soap,
Detergent Powder, Dishwash Powder’ in the state of Kerala upto Rs 8.60 million for a period of 7 years from
August 30, 2001 to August 29, 2008 vide Order no A5/5373/2002 dated March 7, 2003 issued by the General
Manager of District Industries Centre, Thrissur.

Dadra and Nagar Haveli
The Company would be entitled to exemption from tax payable on sales of ‘Ujala’ manufactured and sold
from the Union Territory of Dadra and Nagar Haveli upto December 30, 2014 vide Certificate No ADM/DNH/
EC/VAT/87 dated August 30, 2005 issued by the Deputy. Commissioner (VAT).

33

2003 as amended from time to time for a period of ten years from the commencement of commercial production. Uttaranchal The Company would be exempted from payment of central excise duty for the goods manufactured in the unit at Haridwar vide G. 34 . no commercial production has commenced at this unit till date.E. Notification No. Kamrup for a period of 10 years from the commencement of commercial production vide Notification No 32/1999-CE dated July 8. Himachal Pradesh The Company would be exempted from payment of central excise duty for the goods manufactured in the unit at Baddi vide G. 2003 as amended from time to time for a period of ten years from the commencement of commercial production of eligible products.E. However. Dist. 1999 as amended from time to time. 1944 and the rules made thereunder: Assam The Company would be entitled to a refund of the central excise duty paid through current account on manufacture of ‘MAXO—Mosquito Coil’ in their unit at Amingaon. 50/2003-CE dated June 10. Notification No.(J) Benefits available to the Company under Excise legislation The Company is entitled to following benefits under the Central Excise Act. 50/2003-CE dated June 10.

mosquito repellents.) Penetration level as well as per capita consumption in most product categories in India is low indicating a large untapped market potential.680 mn Rs. 66.841 mn Rs. 72. Moreover. The sector also creates employment for three million people in downstream activities. present an opportunity to the manufacturers of branded products. The burgeoning Indian population particularly the middle class and the rural segments.272 mn Insecticides Insecticides Rs.233 billion by 2012.828 mn Air care Air care Rs. 8.org.641 million Total Market Size—Rs 106.759 mn Rs. rural and semi-urban areas of the country will account for approximately 60% by 2012. 458 mn Rs.org. much of which is disbursed in small towns and rural India. insecticides. toilet cleaners. 13. the total market size of FMCG products is expected to grow at a CAGR of 12% over the next 5 years. (Source: www. Of the total market. 10. laundry care. December 2006. 578 mn Dishwashing Dishwashing products products Rs. 9. led primarily by increasing rural penetration and growth in disposable incomes. Introduction The Fast Moving Consumer Goods (FMCG) sector in India is the fourth largest sector in the Indian economy with a present market size of approximately Rs 700 billion. The sector has strong links with agriculture and around 71% of the sales come from agro-based products. (Source: ASSOCHAM).4 billion in 2015. intense competition between the organized and unorganized sector and low operation costs.903 mn (Source: Euro monitor International. Low-priced products contribute the majority of the sales volume and lower and middle-income groups account for over 60% of the sector’s sales. It is a significant value creator with a market capitalization second only to the IT sector and is a key contributor to the exchequer. Household care comprises household cleaners. 12. It is a key component of India’s GDP and is a significant direct and indirect employer accounting for 5% of the total factory employment in the country.) The Indian FMCG industry is characterized by a well-established distribution network.ciionline.6 billion in 2003 to US$ 33. air fresheners.) 35 . According to ASSOCHAM estimates (“Future of FMCG Products in India”).112 mn Rs. 7. rural markets account for approximately 56% of the total domestic FMCG demand. polishes and other products related to household care Household Care segment 2005 (Actuals) Household Care segment 2010 (Projected) Total Market Size—Rs 96. “Household Care—India”. (Source: www. reaching around Rs 980 billion by 2010 and about Rs 1. The FMCG market is set to increase from US$ 11. Household care products are a major segment of the of the FMCG industry.630 million Others Others Rs. SECTION IV: ABOUT OUR COMPANY INDUSTRY The information in this section has been extracted from publicly available documents from various sources and has not been prepared or independently verified by us or any of our advisors.840 mn Laundry care Laundry care Rs.ibef.

Sustained investment over a period of time is required to create an association in the mind of the consumer.9% Others 3.4% Total Household care 2. In certain segments. its delivery format. companies can avail themselves of third party manufacturing facilities.0% 2. A thorough understanding of the needs of the consumer is key to creating and offering differentiated products. positioning and brand extensions typically play a key role in the success of a product in the FMCG sector. pricing and communication. Brand building. Cost Factors Materials costs and marketing and advertising are the primary costs incurred by a company in the FMCG sector. having built strong consumer loyalty with consistent quality over long periods of time. Occasionally. Slowdown in demand and fierce competition can necessitate a sharpening of focus on key brands and ensuring cost reduction besides focusing on aggressive and penetrated marketing. Moreover.0% 3. As brands get stronger.0% 6. Given the importance of branding in the industry. Investments in manufacturing assets are also relatively low. In the recent past however. yielding a high turnover to investment ratio. thereby enhancing margins and profitability. companies that have a large scale of operations are able to negotiate lower input costs of raw materials.5% 0. Manufacturing processes are typically simple. The chart below depicts projected sales growth rate of various segments in the household care sector in India.0% 1. as the highest value addition comes in the process of branding. A portfolio with some strong brands enables an FMCG company to invest in new brands to create a pipeline of new brands and products for the future. thus reducing their investments in fixed assets further. This forms the basis of FMCG strategy. products are re-launched by repositioning the brands to re-start the life cycle of a product and extract better value from it.5% Insecticides 1. the industry has seen several innovations to provide superior and more convenient packaging at lower packing material costs. By and large.0% 4. advertising and sales promotion expenses comprise a significant element of cost. The price the consumer is willing to pay is a function of the perceived value of physical attributes such as the product. In packing material.0% Laundry care 1. Others have created brand value through innovative product offerings with superior functional attributes supported by strong advertising and sales promotion campaigns. its packaging and its availability as well as the image built around the brand. the industry is characterized by relatively low manufacturing costs. FMCG players must develop the insights into the needs of their customers.0% Chief Characteristics of the Indian FMCG Industry Extensive Brand Building Creation of a strong brand is essential for FMCG companies and considerable money and effort is expended in the development of brands. Companies with a focus on building strong consumer franchises and creating a demand for their brands would usually spend a larger proportion of the advertising and sales promotion costs on above-the.0% 5. they are able to command a better price and reduce the proportion of advertising support to maintenance levels. FMCG companies have availed themselves of certain excise and income tax concessions by setting up their own manufacturing facilities in designated tax free zones. Some brands enjoy a first mover advantage.line advertising. including design of the product. The initial period in the life of a brand is likely to require higher expenditures on advertising and sales promotion as the brand owner attempts to create a positioning for the brand in the mind of the consumer. A more short-term measure would be to spend a larger proportion on sales promotion and channel discounts to create a sales push. 36 . Dishwashing products 4.

50 0.6 0.Extensive Distribution Networks Delivering products to the point of consumer demand is a key determinant of success in the FMCG industry.5 0. 13. 37 . Contract Manufacturing With primary focus on brand building. organized sector players face revenue losses due to fake and counterfeit products produced by the unorganized sector players. most FMCG companies outsource their production requirements to third party manufacturers. with several items reserved for the small-scale industry and with these SSI units enjoying tax incentives. Typically products from unorganized players are priced lower to entice consumers and also offer higher margins to stockists and intermediaries in order to provide a sales push. wholesalers and retailers. supermarkets and large-scale retail malls offering a wide rage of products at discounted rates.4 0. The key constituents within the distribution chain are the company’s C&F agents. and through direct selling and multi-level marketing which typically involves sales through agents instead of the usual bulk or small-scale retailer.4 0.9 0. The strength of the distribution network helps a brand to grow volumes through increased penetration levels. product development and creation of distribution networks. fiscal incentives from government and low brand awareness in small towns and in rural India have led to the mushrooming of a strong unorganized sector in India offering localized brands as well as products in a loose unbranded form. the contract- manufacturing route has grown in importance and popularity.60 2 1.7 0. they would have the advantage of allowing greater penetration of products and could lead to an overall increase in revenues for the sector. Some estimates suggest that the FMCG sector may be losing between 10% to 30% of its business to fake and counterfeit goods. Moreover. While such newer distribution channels have an impact on the conventional retail margins. This indicates ample headroom for increase in product penetration. any national player must establish a wide distribution network. Large Unorganized Sector Factors such as low entry barriers in terms of low capital investment.9 14 12 10 9.7 4 2.07 0 Fabric Wash Shampoo Personal Wash Toothpaste UK Brazil Thailand India New Retail Formats Of late the Indian FMCG industry has witnessed the emergence of newer forms of distribution through the advent of modes such as hypermarkets.2 0. distributors. These market intermediaries ensure widespread presence for the brand so that the products are available to consumers where they want them.4 0. Additionally.3 1. Given the size of the Indian sub-continent.04 0.0 8 6 4. Low Product Penetration Compared to Emerging Economies Per capita consumption in most of the FMCG categories (including the high penetration categories) in India is low compared to both developed as well as emerging economies.

rural India has access to significantly fewer of the branded products that are available to the urban consumer.5 % and 8. is expected to have a positive impact on demand for FMCG products.4% 0. which. for the fiscal years ended March 31.5-8.7% Source: Euro monitor International. a low per capita disposable income and seasonal consumption linked to harvests.8% 72. supermarkets and hypermarkets have increased in prominence with regards share of Household Product sales. 7.4 %. coupled with growth in share of middle class. the Reserve Bank of India has projected a 7.4% Chemists / Supermarkets/ Chemists / drugstores hypermarkets drugstores Supermarkets/ 1. between 2000 and 2005.7% 9. Household Product Sales Distribution—2000 Household Product Sales Distribution—2005 Departmental Departmental stores Others stores Discounters Others Discounters 5. Very Rich Consuming Class Climbers Aspirants Destitutes 0% 10% 20% 30% 40% 50% 60% % of Total 2003 2015 Also. availability of branded products at lower price points and price correction by the FMCG companies. [Source: IBEF].0% stores 1. December 2006 Key Drivers and Trends in the FMCG Industry Large Untapped Rural Market Currently.9% stores Convenience 1. just about 50% of the overall revenues of major FMCG companies come from rural areas although 70% of India’s population lives in rural areas. 2005 and March 31. Economic Growth In recent times.0% hypermarkets Convenience 12.3% 4.6% 4. However with the Government’s push to improve the rural infrastructure.2% 4.6% 3. the Indian economy has shown robust growth. The overall economic growth has been accompanied by increased disposable incomes both in the urban and rural markets. increased efficiencies in distribution. respectively. 2007. Despite the alluring prospect of a large untapped market. This has clearly begun to benefit the FMCG sector in which many companies had experienced a rather sluggish growth in the few years prior to 2005. In terms of brand choices. penetration levels in many FMCG categories are poised to go up in rural areas. India has begun to see a rise in the disposable income in the hands of the middle class. Over the last three years. inadequate infrastructure facilities including roads and power. Further. The chart below depicts the expected increase in middle class.6% Independent Independent food stores food stores 77. 38 . As shown below. “Household Care—India”.8% 0. festivals and similar events. a strong un-organized sector. Rising Disposable Incomes coupled with Burgeoning Middle Class Demand for FMCG products are set to boom led by increase in share of middle class (defined as the climbers and the consuming class).5 %. India has experienced rapid economic growth with the GDP growth recorded at 8.0 % GDP growth for the Fiscal ending March 31. 2004. March 31. heavy dependence on external factors such as monsoons. a variety of factors have posed difficulties in harnessing this market such as high prices of branded FMCG products. 2006 (Source: Reserve Bank of India).

Nirma Limited’s “Nirma” brand and Procter & Gamble Home Products Limited’s “Ariel” and “Tide” brands.7% 70 62 59 60 57 54 49 51 50 (Rs. Over the past five years.842. LAUNDRY DETERGENTS 80 CAGR : 4. Of these. This provides an opportunity for new brands and products to be picked up by the experimental consumer.) The chart below depicts the historical and projected sales value as well as CAGR growth rates of laundry detergents.Retail Expansion Retailing has experienced a revolution over the last few years. Laundry care comprises laundry detergents. 61. spot and stain removers. such as fabric whiteners.) Laundry aids comprises laundry boosters. starch and ironing aids and other products used in laundry.4 million in 2005.903.7% respectively. foreign direct investment in retail is expected to be permitted. December 2006. FMCG players will have to upgrade their skills in merchandizing and shelf management as the open formats allow more interaction between the consumer and the products. bn) 40 30 20 10 0 2000 2001 2002 2003 2004 2005 39 . Household Care: Product Segment Profiles and Outlook Laundry Care The laundry care product segment of the household has sales totaling Rs. (Source: Euromonitor International. accounting for sales of Rs.56% of the laundry care category in 2005. Whilst this is not significant as a percentage of FMCG sales today. On the other hand. laundry detergents and laundry aids have grown at a CAGR of 4. laundry aids. 5. including supermarkets and hypermarkets has been emerging.44% of laundry care sales.060.6. “Household Care—India”. which are focused on greater affordability delivered through squeezing efficiencies from the supply chain. the large modern retail format. Companies can also leverage information technology to create supply chain synergies. laundry aids as well as overall laundry care categories in India. accounting for approximately 69. was laundry aids. this share is expected to increase manifold in the future. which would attract overseas retailers to participate in one of the fastest growing consumer markets today. On the one hand there are chains. (Source: Euromonitor International. The overall laundry care market has grown at a CAGR of 5%. If and as the large retail forecast grows. “Household Care—India”. The second largest category. fabric softeners and carpet cleaners. Gradually.7% and 8. The value that consumers are being offered through a discount as compared to a neighborhood store is significant and the future will see the expansion of this concept. as has happened elsewhere in the world. December 2006. “Surf” and “Rin” brands.23% of all sales in the household care sector.8 million in 2005. accounting for 92. or 7. The laundry care product segment includes Hindustan Lever Limited’s “Wheel”. 66. laundry detergents comprised sales of Rs.

bn) 40 30 20 10 0 2000 2001 2002 2003 2004 2005 Insecticides Insecticides comprise various products for the elimination of insects. electric insecticides (which are plugged into an electrical outlet and slowly release repellent). (Source: Euromonitor International.7. or 7.9 million. respectively. December 2006.) 40 . 5.7% 5 5 5 4 4 (Rs.52%.53% of household product category sales. 12. insecticide sales totaled Rs. The insecticide segment sales have grown at a CAGR of 7. LAUNDRY AIDS 8 7 6 CAGR : 8. During 2005. bn) 4 4 3 3 2 1 0 2000 2001 2002 2003 2004 2005 TOTAL LAUNDRY CARE 80 CAGR : 5.2% over the last five years and at a CAGR of 6% from 2004 to 2005. or 42. Sales of insecticide coils and electric insecticides accounted for Rs. of insecticide sales. “Household Care—India”.467. and Rs. The principal types of insecticides in India include insecticide coils.59%.0% 70 67 64 61 58 60 55 52 50 (Rs. or 43. spray and aerosol insecticides and other forms of insecticides.7. 5.840.588.

5 4.6 (Rs.6 CAGR : 5. bn) 3 2 1 0 2000 2001 2002 2003 2004 2005 INSECTICIDE COILS 6 5. The tables below depict the historical sales value as well as CAGR growth rates of various segments of insecticides in India.6 0. bn) 0.4% 4.7 (Rs.9 CAGR : 10.2 0.8 4.3 5.9 0.3 0.0 0.5 0.1 0.7 0.7 0.2% 0.8 0.8 5 4.4 0.4 4.1 5 CAGR : 8. bn) 3 2 1 0 2000 2001 2002 2003 2004 2005 41 .5 5. Spray / aerosol insecticides SPRAY / AEROSOL INSECTICIDES 1.9 0.0 4 3.2 4 (Rs.1 4.0 1.8 0.0 2000 2001 2002 2003 2004 2005 ELECTRIC INSECTICIDES 6 5.7% 5.

0 2000 2001 2002 2003 2004 2005 TOTAL INSECTICIDES 14 12. Household labour is relatively inexpensive and abundant. bar soaps and liquids. OTHER INSECTICIDES 1.2 0.6 0.4 0.8 0.1 0.5% 0. Hand dishwashing products come in various forms.7 0. “Household Care—India”.5 (Rs. bar soaps is the dominant form in most parts of India.7 0. with housemaids cleaning dishes for most consumers who are interested in purchasing branded dishwashing products.0 0.6 9. including powders.1 12 CAGR : 7. bn) 6 4 2 0 2000 2001 2002 2003 2004 2005 Dishwashing Products Dishwashing products comprise various products for washing dishes.6 0.2% 11. At present.5 0.7 0.8 12.6 0. December 2006. Presently. bn) 0. the vast majority of sales are for hand dishwashing products as automatic dishwashing is negligible. (Source: Euromonitor International.3 0.9 CAGR : 7.) 42 .0 8 (Rs.4 10. with penetration of dishwashers remained at below 1% in India as a whole and 2% in urban India.7 0.8 10 9.

8% 205 200 187 169 (Rs.000 0 2000 2001 2002 2003 2004 2005 (Source: Euromonitor International. mn) 100 80 60 40 20 0 2000 2001 2002 2003 2004 2005 43 .759. December 2006.119 4. December 2006. air care sales in 2005 totalled Rs. mn) 5.000 7. DISHWASHING PRODUCTS 9. dishwashing product sales totaled Rs.) The tables below depict the historical sales values as well as CAGR growth rate of various segments of air care products in India.524 (Rs.000 1.03% of total household product sales.000 7. “Household Care—India”.7% 160 148 135 140 123 120 (Rs.2.) The tables below depict the historical sales value as well as CAGR growth rate of dishwashing products in India. SPRAY / AEROSOL AIR FRESHENERS 300 271 247 250 226 CAGR : 9. “Household Care—India”. (Source: Euromonitor International.000 3. or 0. “Household Care—India”.408 5.000 5.47% of household care sales.000 2. (Source: Euromonitor International. In 2005.000 4. fueled by aspirational consumer demand amongst increasingly affluent urban consumers. December 2006.2 million.766 6.000 CAGR : 11.759 8.4% 6.) Air Care Air care comprises spray and aerosol air fresheners along with other household air care products.048 7. or 8. mn) 150 100 50 0 2000 2001 2002 2003 2004 2005 OTHER HOUSEHOLD AIR CARE 200 187 175 180 162 CAGR : 8. 7. According to Euro monitor International. Air care products are stronger in urban areas. 458.

December 2006.4% 422 450 388 400 353 350 322 293 300 (Rs. “Household Care—India”. mn) 250 200 150 100 50 0 2000 2001 2002 2003 2004 2005 (Source: Euro monitor International. TOTAL AIR CARE 500 458 CAGR : 9.) 44 .

dish wash powder. dishwashing. Manufacturing facilities located in these geographical locations are granted exemptions/concession from Income Tax on profits made from these facilities. Maxo. .63 million outlets in India as on March 31. our Ujala fabric whitener was available in approximately 2. fabric stiffener and washing powder. . Nielsen and. and Maya. .6 14. . . . . .2 17. . . . . 2007 according to A. . Tax efficient facilities are set up to take advantage of certain tax breaks offered by the central and state governments. We produce personal care products under the Jeeva brand and market air freshening incense sticks or agarbatti under our Maya brand.0 68.5% market share in India by value for the month ended March 31. household insecticide. Market share information for our Ujala fabric whitener and Maxo coils in India and Exo dishwashing powder in Southern India is set forth below. . . . . in Kerala. . . . Our Maxo product line consists of mosquito repellent coils. We believe that our brands enjoy strong association with our core values including offering value-for-money products to the common man. personal care and air care segments of the Indian market and offer branded products including fabric whitener. .C. Nielsen) Our Maxo mosquito repellent coils achieved a 20. 2007.2 17.C. . 2007.1 Exo Dishwashing Bar* . . 2007 March 31.1 19. .2 68.500 distributors. 2007. The product line for Ujala (a 24 year old brand. . Nielsen. we outsource the manufacture of a significant 45 .500 people servicing approximately 2. . .C. .5 23. Ujala was purchased by 75. bath and incense products. . surface cleaning. . We also have entered into joint ventures to market and distribute coffee and spiritual dhoops. 2006 to March 31. liquid vaporizers and aerosol sprays. As part of our efforts to expand. in particular. . . our Exo dishwash bar achieved a 17% market share in southern India by value for the month ended March 31. 2007 April 30.1 21. 19. . . We have established a distribution network across India with a sales staff of over 1. Ujala’s success led us to be ranked first in fabric whitener with a 68.7 20.C. . .C.8 17. as per estimates from Marketpulse-IMRB’s Household Purchase Panel. Our brands are particularly strong in southern India and Kerala. .9 24. 14.2 20. . Nielsen ) * For Southern India only. We believe that our field staff have a direct reach of approximately 1 million retail outlets.6% market share by value in the year ended March 31. . For example.8 17. we are in the process of establishing new tax efficient manufacturing facilities in Uttaranchal (Uttarakhand). Nielsen) In addition.5% market share in India by value for the month ended March 31. .4 million surveyed households during the period April 1. Our flagship brand Ujala liquid fabric whitener had a 68. 2007. 2007 Value Volume Value Volume Value Volume Value Volume Ujala Fabric Whitener .6 53.1% market share by value in the Indian organized segment in 2006 according to A. mosquito repellent. .8 68. . . eight of which are tax efficient units. targeting our various brands and specific products to suit consumer needs and tastes. 2007. According to A. . Exo.5 Maxo Coils . Jeeva. . . .3 52. . Exo’s product line includes dishwash bars and dish wash liquid with an anti-bacterial agent. used prior to incorporation of the Company) consists of fabric whitener. (Source A.. . (Source A.1 (Source: A. We manufacture our products through 21 manufacturing facilities in 14 locations across India.4 22. Nielsen. .C. . Our Ujala fabric whitener and Maxo mosquito repellent coils occupy leading positions and have significant market shares in their respective product segments.0 16.0 16. . . Our branded products are present throughout urban and rural India.5 53. (Source A. . Our key brands are Ujala. . and dish scrubbers. Nielsen) We intend to launch Exo nationally in 2008. Market Share (%) Year ended Quarter ended Month ended Month ended Product Categories March 31. . In addition to our own facilities. .7 53. . . We have focused the marketing and distribution of our products in various states in India and in both rural and urban areas. our Ujala fabric whitener achieved a 96. This represents 37% of the surveyed household population. 68. . . We have extended most of our brands nationally. and exemption/refund of excise duty on products manufactured at those units by Central Government and deferral from payment of VAT/Sales tax payable on sale of products of these units within specified areas by the concerned state governments. BUSINESS Overview We are a fast moving consumer goods (FMCG) company in the fabric care.C. . . 2007 March 31.

74 million for the nine months ending March 31. 170 million in two plants located at Jammu and Guwahati to produce Maxo products that are currently outsourced. We have established a distribution network across India with a sales staff of over 1. 3.500 distributors. We believe that our field staff have a direct reach of approximately 1 million retail outlets. 301. We try to ensure that our products and our communication strategies are innovative and appropriate. Business philosophy Our business philosophy is a key factor influencing our success. Our manufacturing facilities and sales offices are strategically located to ensure our local presence in key markets. M. 2775. 395. • We believe in innovative products and positioning: We believe in following the path of innovation in order to differentiate and effectively position ourselves in our targeted segments.69 million and Rs. provides us with a strong platform to maintain and grow our revenues from those brands. Our total consolidated gross sales have grown over the last three fiscal years at a compound annual growth rate (CAGR) of approximately 10 %. including the brand images and consumer associations those brands enjoy.46 million for the nine months ending March 31. namely: • We assess consumer needs and desires: We believe it is essential to understand the needs and desires of the consumer and assess gaps between needs and available products. 2007 and 2006. Strengths We believe that we are well positioned to sustain and strengthen our position in the markets in which we compete as well as to exploit significant growth opportunities that exist in the expanding household goods sector. • Product attributes are tailored to meet customer needs: We believe that the product should be an effective solution for the need gap.33million for the year ended June 30.500 people servicing approximately 2. We also maintain an in-house engineering research and development and machinery manufacturing facility at Pondicherry. Strong brand identity We believe our portfolio of brands. Nielsen.47 million and Rs. including 46 . We also hire local production.57 million and Rs. Ramachandran.01 million for the year ended June 30. We are investing Rs. We aim for our achievements to act as a catalyst to reach greater heights and we believe in a continuous process of drawing motivation and inspiration from our achievements and constant self-assessment for improvement. 2007. 2006 and Rs. We also have a wide distribution reach. our Ujala fabric whitener was available in approximately 2.48% of our shareholding of our Equity Shares on the date of filing this Draft Red Herring Prospectus. 2. Our total consolidated gross sales were Rs. • We develop effective communication strategies: We believe that our advertising and marketing strategy should effectively position the product so that the product attributes and their effectiveness in the targeted segment are appropriately communicated. sales and distribution employees with knowledge of local languages and customs. • We draw inspiration from our achievements and seek to better ourselves.84 million for the nine months ending March 31. 3019. 2006 and Rs.663. 2007 and 2006. Our local presence also provides us with the ability to launch new products and extensions at the local level (on shop shelves) in a short time. in both urban and rural India and abroad.P. and the product attributes should be tailored accordingly. 2285. We take care to assess these needs and target need gaps and convert them into an opportunity to target customers. We believe that our local presence and local focus gives us an advantage in understanding and communicating with our customers. Our total consolidated net sales were Rs. 398.63 million outlets in India as on March 31.C. respectively.portion of our Maxo products. Our profit after tax was Rs. Our Promoter is Mr. holds 69. 2006 and Rs. Our business philosophy has the following constituents. respectively.294. 2007 and 2006. 3. sales and distribution of our products. who together with the Promoter Group.85 million for the year ended June 30. respectively. According to A.797. We intend to continue to pursue new business opportunities and consolidate our existing position in accordance with this philosophy. We believe the following are our principal strengths: Local presence and wide distribution reach We have a strong local focus to the production.

C. good agricultural performance over 2003-2006 boosted rural household incomes. 47 . we believe that our brands enjoy strong association with our core values like offering value for money products and service to the common man. Members of our product development teams undergo competency-building training programs to gain better insight into consumer needs. This represents 37% of the surveyed household population. we have established an internal culture encouraging innovation and development. As of April 30. Source: Euromonitor International. In developing new products. product improvements and new products under our existing brands. Nielsen). (Source A. we employed a work force of approximately 3. 2007. Our well-qualified and experienced management team has played a key role in the development of good corporate governance. (The Economic Times. Ujala was amongst India’s 50 most trusted brands . In particular.C. detergents. they follow a structured process for identifying project ideas.450 employees in India. making rural consumers more interested in purchasing packaged household care products. Nielsen) and received “AAA Brand Performance Award” from All India Advertisers Association in 2002. As per estimates from Marketpulse-IMRB’s Household Purchase Panel.1% market share in India by value for the year ended March 31. Maxo mosquito repellent coils were marketed to India’s rural markets and became a leading coil brand in rural India where coils are more popular than other methods as a result of unreliable electricity supply. strong employee relations. 2007. 2007. establishing prospects. as a result of difficulties with distribution.4 million surveyed households during the period April 1. To do this. For example. Focus on the rural markets We believe that our focus on rural markets for our products will allow us to benefit from this growing sector where. 2007.3% market share in India by value for the year ended March 31. Nielsen) Maxo was the leading mosquito repellent coil in rural India in April 2007 (Source: A. testing hypotheses. and Ujala ranked 8th in the home and fabric care segment and 19th among class 2 cities in the Brand Equity Survey. The skills and diversity of our employees gives us the flexibility to respond to the needs of our customers and consumers. Ujala Stiff & Shine and Jeeva natural soap. The success of our Ujala fabric whitener led us to be ranked first in fabric whitener with a 68. We have also been able to reduce the weight of our Ujala bottle that has lead to important raw material cost savings. This has enabled us successfully to identify and implement new products and product improvements. We have a product and formulation R&D centre and our R&D team aims at formulating innovative products and packaging concepts into aesthetically appealing product offerings for the benefit of consumers. and stable supply chain relationships.C. We have a research and development (R&D) team comprising of scientists and technicians from various disciplines. penetration of branded household care products has been slow. May 30. In addition. June 6. In addition. (Source A. Strong employee base and proven management team We believe that our employee base is a key competitive advantage. Our senior management team has a breadth of experience in the FMCG industry. Ujala was purchased by 75. implementing improvements and sustaining benefits. 2007) Our Maxo mosquito repellent coils achieved a 19. bar. The market for FMCG in rural India is growing due to a monetary trickle-down effect from increased urbanization. Innovation and product development We believe a key factor in our ability to succeed and to continue to sustain and strengthen our business has been and will continue to be our ability to innovate and develop improvements to existing products and to create and introduce new products that will meet or create customer demands that are not presently being satisfied by available products. household antiseptics/ disinfectants and hand dishwashing liquid have benefited notably from this trend. This process has led to new product developments such as our fabric conditioner. December 2006. “Household Care”. 2006 to March 31. 2007. Improved rural economic conditions have resulted in consumers shifting to branded and packaged products from unbranded products .through our present products. We are dedicated to the development of expertise and know-how of our employees and continue to invest in them through training and skills. effective internal controls and accounting policies. 146 of the senior management team members have been with us for over 5 years.

• through an increase in market penetration of our products. 54. Leverage our dominant Ujala brand with other branded fabric care products We plan to leverage the dominant market leadership of the Ujala brand with our Ujala Stiff & Shine and Ujala washing powder products. raw material management. Improve efficiencies and manage our costs We seek to improve efficiencies and costs from the sourcing of the raw materials to the supply of products to consumers. For example. distribution and sales process. We also have an agreement with Godrej Tea Limited to distribute its Godrej Tea brand in India. improving yields and tax structuring. Our Strategy We intend to work toward achieving our vision and to grow our business by implementing the following key strategies. we had consolidated net sales of Rs. Increase Maxo’s Presence We plan to increase the market share and presence of our Maxo products • through the introduction of liquid vaporizers and aerosol spray products. we are able to sustain our culture of innovation and development and to compete more effectively with our competitors. We intend to launch our Ujala Stiff & Shine product nationally in 2007. We launched our Ujala washing powder in Kerala in 2005 and will launch the product in other southern Indian states in 2007. 2007 and the financial year ended June 30. sales and distribution of these branded products. Our Board has approved an investment up to Rs. In addition. which is a variety of agarbatti. We believe that the strong brand equity of Ujala and our wide distribution reach will help us successfully develop Ujala Stiff & Shine as a national brand. While the current share of our revenues through these chains is not significant. our Board has approved a proposal to establish joint venture (with at least 75% of the equity owned by the Company) to manufacture and market our Ujala and Maxo products in Bangladesh. We believe our strong presence and local knowledge will allow us to develop Ujala washing powder as a strong regional brand. We set cost improvement targets each year and offer performance based incentives to key managers to meet such targets. In the nine months ended March 31. Utilize our wide distribution network and marketing expertise We intend to utilize our wide distribution network and marketing expertise to attract joint venture partners with existing branded products as well as new and innovative product ideas. it is expected that this may rise significantly 48 . aimed at customers with astrological interests and beliefs. • through sales and marketing efforts in Bangladesh where we can leverage the strength of our Maxo brand.81 million and Rs. to tap high growth categories and to reach underdeveloped markets and emerging categories to meet the day-to-day requirement of every Indian household. • through marketing and product enhancements designed to attract customers from segments of the population and from regions where our competition is strong. We also seek to promote our core values that include offering value for money products to the common man. We believe that by aggressively seeking to cut costs throughout our production. 60. Where possible we intend to obtain joint brand ownership and joint control over the marketing. respectively from our joint ventures and marketing contracts.60 million. 2006 . Certain areas identified by us for cost reduction projects include packaging design.Our Vision Our vision is to develop innovative brands. 75 million in this Bangladesh joint venture. Increase focus on supermarket and hypermarket sales India has in the recent past witnessed the emergence of new supermarket and hypermarket chains. we have entered into joint ventures to market and distribute coffee and dhoop. and • through the acquisition of local brands in select markets.

96 138.21 223. especially in the larger cities. . 2006 June 30. we intend to adapt our distribution and selling strategies to take advantage of new benefits and seek to maintain and strengthen our brands and our sales.55 196. . 2004 Fabric Care . We intend to target acquisitions which will strengthen our market position in our key product areas or our manufacturing capabilities.43 646. . we acquired a local fabric whitener brand called “Ruby Liquid Blue” on April 19 . . In general. we believe that new supermarket and hypermarket chains generally provide an opportunity for better merchandising and visibility and cost savings through direct sales rather than through intermediaries and rationalization of packaging. We also acquired a fabric whitener brand called “More Light” on May 31. Our Products We focus on providing branded household goods in fabric care.45 69.40 54. 1. . .14 Joint Venture and Third Party Products* . For example.097. mosquito repellent. . .63 Dishwashing . .21 1.331.319. 2005 June 30.600.13 1. The following table sets forth the gross sales from our major product categories.5 million. .315. 2006 June 30.376.78 132.00 * For further information about our joint venture contracts. .38 0. . . (Rs. . . 1. .85 1.in the next few years. the trade margins and discounts expected by supermarket chains in India are higher than traditional retail outlets.24 175.00 0.40 1. .95 1. . 76.432. 9. Pursue selective acquisitions We intend to make acquisitions in the future as part of our growth strategy in India.50 127.99 Other Products . 230.77 107. millions) 9 months ended 9 months ended Financial Year ended Financial Year ended Financial Year ended Product Categories March 31.20 1.02 1. . .367. 49 . 178.2007 from Messrs. .57 Mosquito Repellent .389. . We continuously evaluate acquisition opportunities that arise.806. ayurvedic bath and incense and aroma sticks. . As the presence and importance of new supermarket and hypermarket chains increases. see the section titled “History and Corporate Structure-Material Contracts” on page 67 of this Draft Red Herring Prospectus. 10 million. 2007 March 31. . However.12 1. . 2007 from Modern Chemical (India) & Mod Chem (India) Private Limited for a consideration of Rs. . Bangalore Detergents and Plastic Company for a consideration of Rs. . dishwashing. .

.3 3. which enables the products to be sold at a higher margin than they might be otherwise. May 31.C. . softeners and conditioners. .3% market share in India by value for the year ended March 31. . . . excluding local and miscellaneous companies.3 4. We believe Ujala fabric whitener created a market for fabric whiteners because it was formulated for ease of customer use and provided uniform whitening that does not cause clothes to “blue” or appear patchy.0 3. .1 3. . . . .6 Year ended June 30. along with our aggressive and informative advertising campaigns have built our Ujala brand. and we will launch Ujala washing powder in other southern Indian States toward the end of 2007. . .2 4.” The following table set forth the competitive position of our Ujala fabric whitener in India. (Source A. . . . . . . .3 (Source: A. 2004 . . . 2007. . . . We also plan to roll out other Ujala extensions such as stain removers. . . . 2005 . Ujala washing powder ranked fifth in sales in Kerala selling 1. . . was launched in 1983 (prior to the Company’s incorporation). .1 4. . . . .2 3.2% as of the quarter ending March 31. 50 . .8 4. . . Market share for Fabric Whitener in India* % market share of % market share of % market share of Period Ujala by sales value Competitor brand 1 Competitor brand 2 Value Volume Value Volume Value Volume Year ended June 30. Our Ujala washing powder was launched in 2001. . Nielsen) * Within the liquid blues subcategory. . . . our first fabric care product. 2007). . In particular. a leading fabric care brand. no other competitor has a market share by sales value exceeding 1. 2007 . a formula developed by us to improve brightness of clothing. . has been the flagship of our business. ranked first in fabric whiteners with a 68. . .C.1 48. . . .C. Ujala fabric whitener has a national presence and.1 3. . Ujala was among India’s 50 “Most Trusted Brands. . .4 3.3 4.7 49.464 tons of powder (Source: A. . . 65. the Company and three of the Company’s competitors. . . . .8% and by volume exceeding 5.Fabric care: Ujala We market fabric care products through our Ujala brand. . 2007 and a 68. . . and Ujala. In the Brand Equity Survey (The Economic Times. Nielsen). 68. . .9 Quarter ended March 31. . . In 2006. In addition to fabric whitener. the Ujala brand also extends to washing powder with “opti-brighteners”. .6 Year ended June 30. . Ujala fabric whitener. . 66. . . . . . We believe that Ujala fabric care products enjoy strong brand equity with consumers. .3 3. 68. . We believe that these product advantages. Nielsen). Branded fabric care products have historically produced the greatest proportion of our revenue.5 53. . . .2 3.3 4.2 3.4 3. We also introduced Ujala Stiff & Shine in Kerala in 2005 to stiffen and brighten clothes as a value added replacement for starch. 2006 . . .7% market share for April 2007.6 53. and liquid detergent.

3 19.3 32. . . we launched Red Giant. . . .0 29.8 21. 36. which are a spiraled insecticide that slowly burns when ignited. . . 2007 and a 20. . . Exo’s brand platform is “Exo stands for Extra clean and Extra hygiene.9 27. .5 Quarter ended March 31. .5 21. . We extended the Maxo mosquito repellent brand into liquids in 2006 and aerosol sprays in 2007.5 33. . . .9% market share by value for April 2007.2 million retail outlets in March 31. . 675 million in 2002 to Rs. Nielsen).7 Year ended June 30. .C. Maxo’s retail penetration reached 1. . . . . . .3 25. .1% market share in India by value for the year ended March 31. .7 30. to carve out a niche in the market.0 21. 2007 according to A. . Maxo received the AAA Best Brand Performance award. . The following table set forth the competitive position of our Maxo mosquito repellent coils in India. . where the highest levels of mosquito population exist and where coils enjoy popularity over electrical insecticides due to electricity supply interruptions. . the largest-sized distributed coil in India. .C.2 (Source: A.C. Both liquids and aerosol sprays are marketed nationally. . .1 28. . . . Nielsen. which contains an anti-bacterial agent that is designed to give a protective cover against bacteria contamination of utensils. Our Maxo coils were launched in 2000 and are marketed nationally and we focus on rural markets. . Our Exo dishwash bar features Cyclozan. .0 24. 1. . . . Moreover. . . . .0 30. . . . .Mosquito Repellent: Maxo We entered the mosquito repellent sector in 2000 under the brand name Maxo to capitalize on the distribution network already established for our Ujala fabric whitener. . . We have strategically linked all brand extensions with the common proposition of “corner to corner protection”. In order to differentiate our brand from our competitors. Dishwashing Products: Exo We entered the dishwashing products with the Exo dishwash bar to capitalize on the distribution strength of Ujala. . . 2007. . .366 million in 2006.6 29. . .7 31. . . . . . . . . Nielsen) * Within the coils subcategory.9 31. . . 2004 . 2006 . . .2 30. . . . . 2007 . .4 22. We have positioned the Exo brand as giving consumers protection against bacterial contamination of 51 . In 2002. 30. . . . . . excluding the Company and three of its competitors no other competitor has a market share by sales value exceeding 3.0 19. 36. . .0% and by volume exceeding 3 % as of the quarter ending March 31. Our Maxo mosquito repellent coils achieved a 19. Our principal product is Maxo mosquito coils. . . . . 2005 .6 33. . The Exo dishwashing product brand has been extended into a dishwashing liquid detergent product named Exo liquid as well as dishwashing scrubber products named Exo Safai. we have developed new packaging with distinct brand identity to promote our coils.9 Year ended June 30.” We launched our dishwash bar in 2000 and at that time the Exo dishwash bar was among India’s first few anti-bacterial dish wash bars. Maxo’s sales value has grown over the last five fiscal years at a compound annual growth rate (CAGR) of approximately 19% from Rs. 35. . . . (Source: A. Market share for Mosquito Coils in India* % market share of % market share of % market share of Period Competitor brand 1 Competitor brand 2 Maxo Value Volume Value Volume Value Volume Year ended June 30.

6 8.2 Quarter ended March 31. Market share for the dishwash bars in Southern India* % market share of % market share of % market share of % market share Period Competitor brand 1 Competitor brand 2 Competitor brand 3 value of Exo Value Volume Value Volume Value Volume Value Volume Year ended June 30.3 17. . .utensils in addition to their promise of “clean and shiny” utensils.7 65.7 11.2 6. 52 .2 Year ended June 30. . 2006 .9 5.2 5. 2007. . .4 9. . 2005 . . . . . .4 8.5 9. . . Currently our Exo dishwash bar is sold in southern India.1 6. The following table set forth the competitive position of our Exo dishwash bar in southern India.8 (Source: A. but we plan a national launch in 2008.0 Year ended June 30.C. .4 5. no other competitor has a market share by sales value exceeding 1. 67.4 8. . 69. Nielsen) * Excluding the Company and four of its competitors.7 6.3 7.6% as of the quarter ending March 31. . .9 7.0 16.9% and by volume exceeding 2. . . 2007 .5 72.2 65. . . . The production of Maya incense sticks is outsourced. Maya has been manufactured and distributed in different fragrances. . To cater to the tastes of different consumer groups. . . .1 11. . 74.0 8.4 7. Other Products: Maya and Jeeva Maya incense sticks were launched on a national level in November 2001. .4 5.8 8.8 68. 2004 . 70. . . .2 8.1 7. .0 5.

we determined to reposition Jeeva and now have focused marketing of our Jeeva products primarily in Kerala for a few years. Location State Products manufactured Commencement 1 Bhubaneshwar Orissa Fabric Whitener (Ujala) 1997 2 Bishnupur West Bengal Fabric Whitener (Ujala) 1999 3 Chennai Tamil Nadu Fabric Whitener (Ujala) 1993 4 Guwahati Assam Mosquito Repellant Coils (Maxo) 2002 and Fabric Whitener (Ujala) 5 Baddi Himachal Pradesh Fabric Whitener (Ujala). No. and the products manufactured at these facilities are as follows: Year of Sr. Manufacturing facilities located in these geographical locations are granted the following fiscal exemptions and concessions: 1. we have joint ventures in which we distribute coffee and dhoops as well as an agreement to distribute tea. Accordingly. publicity and promotional campaigns. For further information about our joint venture contracts. 2. Our various manufacturing facilities. Joint Venture and Third-Party Products In addition to our own branded products. The product is manufactured by Sudarshan Dhoop Private Limited and is distributed by us. As part of our efforts to expand. exemptions and refunds of excise duty on products manufactured at those units 3. Continental Speciale (India) Private Limited (“CSPL”) is a 50:50 joint venture established in May 2007 with CCL Products (India) Limited (“CCL Products”) for the marketing and distribution of coffee under the “Continental Speciale” brand owned by CSPL. Manufacturing We manufacture our products through 21 manufacturing facilities in 14 locations across India. Balaji Telebrands Limited is a 50:50 joint venture with Shobha Kapoor and Ekta Kapoor established in November 2006 for the marketing and distribution of Ekta’s Karyasiddhi Graha Shanti Dhoops. see the section titled “History and Corporate Structure-Material Contracts” on page 67 of this Draft Red Herring Prospectus. we are in the process of establishing new tax efficient manufacturing facilities in Uttaranchal (Uttarakhand). Tax efficient facilities are set up to take advantage of certain tax breaks offered by the central and state governments. however. Fabric 2005 Conditioner (Stiff & Shine) 6 Kandanassery Kerala Fabric Whitener (Ujala) 1983 7 Mehboobnagar Andhra Pradesh Fabric Whitener (Ujala) 1999 8 Pannissery I Kerala Oil based Soaps—Nebula & 1994 Vanamala 53 . We are responsible for the marketing and distribution of the coffee products that are produced by CCL Products. see “Statement of General Tax Benefits” beginning on page 25 of this Draft Red Herring Prospectus. eight of which are tax efficient units. We have also entered into a Memorandum of Understanding to establish a joint venture in Bangladesh to manufacture and market Ujala and Maxo. exemptions from income tax on profits made from these facilities. exemption/deferral from payment of VAT or Sales tax payable on sale of products of these units within specified areas by the concerned state governments. it achieved only a limited market penetration after an extensive advertising. We also maintain an in-house engineering research and development and machinery manufacturing facility at Pondicherry. Balaji Telebrands Limited owns and markets the Ekta’s Karyasiddhi Graha Shanti Dhoop brand. For more information on the tax benefits afforded to our facilities. We also have an agreement with Godrej Tea Limited to distribute its Godrej Tea brand tea in India. We have introduced ayurvedic and natural bath soap products under the Jeeva brand. Our Jeeva brand was launched nationally in 2002. which is a variety of agarbatti aimed at customers with astrological interests and beliefs.

Year of Sr. Generally. Location State Products manufactured Commencement 9 Pannissery II— Kerala Exo Dishwash powder. in such quantities and at such prices as shall be determined. Personal Care (Jeeva) 11 Salem Tamil Nadu Exo Dishwash powder. Ujala 2003 Detergent 12 Silvassa Daman & Diu Fabric Whitener (Ujala) 1999 13 Hyderabad (Subsidiary) Andhra Pradesh Mosquito Repellant Coils (Maxo) 1999 14 Wayanad Kerala Fabric Whitener (Ujala). The agreements are typically for a period of three to five years and may be renewed for further periods by mutual consent. we outsource the manufacture of a significant portion of our Maxo products. 170 million in two plants located at Jammu and Guwahati to produce Maxo products that are currently outsourced. Fabric 2001 Detergent (Ujala) 15 Roorkee Uttanchal Fabric Whitener (Ujala). the manufacturer is responsible for manufacturing the products in accordance with the standards and specifications. Ludhiana. We expect that these plants will be online in August/ September 2007. The agreements provide that the manufacturer shall not have any right over any trademark. We expect to invest Rs. Detergent 2002 Koonamoochy 10 Pondicherry Pondicherry Fabric Whitener (Ujala). used by us or to which we are entitled and that all such intellectual property remains with us. Further. and to sell the product to any person in any territory in any manner and at any price. the agreements provide that the manufacturer will manufacture and we will purchase the product. Below is a map of our manufacturing facilities across India: 54 . In addition to this facility. Fabric Not Detergent (Ujala) commenced production 16 Bari Brahmana Jammu Mosquito Repellant Coils (Maxo) Not commenced production Our subsidiary Sri Sai Home Care Products Private Limited has a facility for the production of mosquito repellent coils located in Hyderabad. on a principal-to-principal basis. trade name etc. 2002 Dishwashing (Exo Bar). No. We have entered into four agreements with third party manufacturers for the manufacture of Maxo mosquito coils in Samba (Jammu). The agreements are on a non-exclusive basis and we are entitled to manufacture and buy the product or any similar goods from other parties. Typically. Hyderabad and Kollar(KGF). The product is manufactured with the approved raw material composition and specification and approved packing material sourced from our approved suppliers at approved rates. the manufacturers have undertaken to only use the information and data disclosed by us to manufacture the product and not to disclose it to any third party without our prior written consent.

500 distributors. and resistance to many chemicals. 2007 it was 9.12% and 22. our largest raw material expenditure. 2007. Marketing Our marketing is a key factor in developing brand awareness and stimulating consumer demand. flexible.C. Koylene. dish wash detergent with Cyclozan. We have traditionally launched new products through the southern states prior to a broader. We believe that our field staff have a direct reach of approximately 1 million retail outlets. ASP is incurred both on strengthening established brands and nurturing new ones. and the Internet to communicate with our consumers. Our raw materials include various chemicals and other materials used in our products as well as the materials for packaging of our products. We source HDPE. ayurvedic soap. We use various media such as television. radio. and eventually national. In particular.500 people servicing approximately 2. An important part of our manufacturing processes includes production of significant portions of the packaging and labeling of our products. durable. Over a period of time we have built substantial brand equity for our products and services as a result of the efforts of our marketing team. outdoor hoardings. This has enabled us to successfully diversify into various new product categories such as fabric washing powder. We obtain our esbiothrin at a negotiated price at a discount to published rates and receive quantity discount for the Esbiothrin used by our third-party manufacturers of Maxo products. The main activity at this unit was the manufacture of an oil-based soap which was marketed in Kerala only. press. fabric stiffener. respectively. During the financial year ended June 30. 2005 and 2006 and the nine months ended March 31. 2007. Our Company has filed a notice dated May 31. Our approach to R&D focuses on project feasibility studies. We invest in advertisement and sales promotion (ASP) to build awareness and loyalty for our brands in the minds of consumers. we engage in low wastage of high density polyethylene (“HDPE”) packaging. dish scrubber.33% of our total expenses (excludes depreciation. from four local suppliers. Nielsen. Kerala with effect from August 1. Supplies of brown sawdust are seasonal. 22. synthetic organic dye (SOD).63 million outlets in India as of March 31. 2006. our Ujala fabric whitener was available in approximately 2. Further to the closure of the unit we expect to terminate the services of 71 workmen. ASP expenditure constituted 9. Materials Consumed Expenditure for materials consumed comprised 22. We also focus on marketing to retailers to increase brand awareness and generate positive placement of our products in retail outlets. and incense sticks. Research and Development Our research and development team comprises scientists and technicians from various disciplines. and has the ability to withstand the sterilising process. HDPE packaging is low cost. We believe that our products should necessarily be born out of consumer need. 1947 to close down our unit located at Pannissery. 2004. LABSA (sulphuric acid). 2007 under the Industrial Disputes Act.62%. an Indian subsidiary of a Japanese manufacturer. an insecticide used in our Maxo coils is sourced from a single supplier.53% of our consolidated total income. 55 . acid slurry. 2007 as this unit has been making losses. we test new products in the southern states to determine feasibility and understand whether consumer demand will be sufficient.08% of our consolidated total income and in the nine months ending March 31. We do not have long-term supply contracts. the financial years ended June 30. and we stockpile these when available for the manufacture of Maxo coils. Esbiothrin.89%. roll out. interest and finance charges) for the 15 months ended June 30. Important raw materials for production of our products include HDPE. 22. Distribution We have established a distribution network across India with a sales staff of over 1. In connection with this approach to R&D and consumer need. We intend to continue promoting strong R&D to formulate innovative products throughout different market sectors. We have a product and formulation R&D centre and our R&D team aims at formulating innovative products and packaging concepts into aesthetically appealing product offerings for the benefit of end consumers. We source our raw materials from various suppliers. esbiothrin (insecticide) and brown sawdust. According to A. mosquito repellent coil and aerosol.

the use of patents. which covers loss and damage due to fire.362 market intelligence assistants. • Production (21 factories)—2. and • Administration (head office and regional offices)—71 employees. We have focused on improving the productivity of our sales and distribution system. Most of our manufacturing units are uninsured. P. but not limited to. Pursuant to the investment agreement with CDC Financial Services (Mauritius) Limited. We believe in meritocracy and this policy commences with hiring individuals with the right expertise and experience while ensuring that progress in the organisation is not dependent solely on tenure. our brands and products by means of intellectual property rights. • Research & Development—14 employees. SARF and Canzone. In addition. independent stores that have close proximity to residential areas (called kiranas). Hong Kong and Saudi Arabia. Our robust information technology infrastructure connects 65 locations on line. As at April 30. We sell our products at an average price that is approximately 25% less than the maximum retail price (MRP). 165 area officers and 1. As at April 30. We have 38 sales depots across India. We sell our products to distributors in Kerala and Tamil Nadu. Insurance We maintain insurance for certain risks including insurance against standard fire and shock in respect of two manufacturing locations.500 employees in India. our Promoter. Mr. Payment terms for our products typically range from 30-60 days depending on the market and the season. Bangladesh. We maintain a key man insurance policy for our Deputy Managing Director. we had over 3. promotes team building. trademarks. We have directors and officers liability insurance for our Directors and officers. M. title and interest in the 56 . to stockists in Karnataka and Maharashtra and to super-stockists in the rest of India. We have a sales force headed by three general managers . We have made investments in information technology to help connectivity and ensure speedier processing of information. Human Resources We are a professionally managed company that has sought to build for itself a stimulating work culture that empowers people. Our products are sold through supermarkets as well as smaller. Our sales force at April 30. • Information Technology—15 employees. limited licenses. Mauritius. 2007 included 36 state managers. encourages new ideas and motivates performance. United Arab Emirates.000 employees. Malaysia.360 employees. Intellectual Property We maintain the ownership of. No credit terms are extended to related parties. We have had no recent strikes or work stoppages and we have a good relationship with our workforce. and control the use of. including. including Sri Lanka. We have two-level disaster recovery systems. who in turn resell down the distribution chain at a sales price as set by the Company. • Machine Designing & Fabrication—78 employees. we have obtained insurance for vehicles owned by us. we export our products to 14 countries in southeast Asia and the Gulf peninsula. The number of employees in each of our divisions as of that date is as follows: • Sales (All India)—1. 2007. In addition to the distribution of our products in India. Ramachandran has transferred the whole of his right. trade secrets and contractual language placed on packaging. 2007. approximately 475 of our employees at two locations were members of trade unions and we have entered into wage settlement agreements with them.

57 . see the sections “History and Certain Corporate Matters— Material Contracts” and “Government Approvals—Trademark Licenses” on page 67 and page 242 of this Draft Red Herring Prospectus. some of the intellectual property used by us is still registered in our Promoter’s name and the formalities of registration in our name have not yet been completed. For further details of the assignment. This transfer was done by way of assignment of trademarks and copyrights. Shivshakti Industrial Estate. we have also taken on lease land in certain instances both from private parties as well as from the government. we have taken on lease land in Bhubaneswar. We have manufacturing units which are located across the country. Marol. Orissa from the Orissa Infrastructure Development Corporation for a period of 90 years. While the key items of intellectual property are now registered in our name. Jyothy Laboratories. For example. Mumbai 400 059. Properties and Facilities Our Registered and Corporate Office is located at 43. Andheri-Kurla Road. While we own some of the land on which our manufacturing facilities are located. Our leases typically have long terms. or pending registration in the name of our Promoter.intellectual property rights registered in. and his sole proprietorship firm.

Ownership Restrictions of FIIs Under the portfolio investment scheme. manufacturing or other processes. and inspection of any premises. officers or persons as it may consider necessary to take steps for the prevention. The information in this chapter has been obtained from publications available in the public domain. The total holding of a single FII should not exceed 10% of the post-issue paid-up capital of the company or 5% of the total paid-up capital if such sub-account is a foreign corporate or an individual. equipment. However. 1981 prohibits the use of any stream or well for the disposal of polluting matter in violation of standards set down by the State Pollution Control Board. The rates to be charged in this regard are specified in Schedule II of the Water Cess Act. and this section is only intended to provide general information to the investors. machinery. plant. the limit of 24% can be raised up to the permitted sectoral cap for that company if approved by its board of directors and shareholders. In addition. treat. If. 1981 and Water (Prevention and Control of Pollution) Cess Act. 1981 no person may establish or operate an industrial plant in any area that has been notified as an air pollution control area by the state government without the consent of the State Pollution Control Board The State Pollution Control Board is required to grant consent within four months of receipt of an application to establish or operate an industrial plant in an air pollution area. 1989 ascribes responsibility to the occupier and the operator of a facility that treats hazardous wastes to properly collect. take all such measures as it deems necessary or expedient for the purpose of protecting and improving the quality of the environment and preventing. controlling and abating environmental pollution. materials or substances and giving. 1986 enacted with the purpose of protecting and improving the environment. For an FII investing in equity shares of a company on behalf of its sub-accounts. A monthly return showing the amount of water consumed in the previous month must also be submitted. When an accident occurs in a hazardous site or during transportation of hazardous waste. 58 . inter alia. REGULATIONS AND POLICIES The following description is a summary of the relevant regulations and policies prescribed by the Government of India as applicable to our business. make rules for various purposes including prescribing the standards of quality of air. of such directions to such authorities. 1989 The Hazardous Wastes (Management and Handling) Rules. 1977 The Water (Prevention and Control of Pollution) Act. the investment on behalf of each sub-account shall not exceed 10% of the total issued capital of the company. It is neither designed nor intended to be a substitute for professional legal advice. The cess to be paid is to be calculated on the basis of the amount of water consumed by such industry and the industrial purpose for which the water is consumed. 1977 (the “Water Cess Act”) requires a person carrying on any industry specified in Schdule I of the Water Cess Act to pay a cess in this regard. the Water (Prevention and Control of Pollution) Cess Act. The regulations set out below are not exhaustive. They must take steps to ensure that persons working on the site are given adequate training and equipment to carry out the work. This Act also provides that the consent of the State Pollution Control Board must be obtained before opening any new outlets or discharges that are likely to discharge sewage or effluent. The consent may contain conditions relating to specifications of pollution control equipment to be installed. 1981 Under the Air (Prevention and Control of Pollution) Act. store or dispose of the hazardous waste without adverse effects on the environment. operations or processes or class of industries. Air (Prevention and Control of Pollution) Act. 1986 The Environment Protection Act. Water (Prevention and Control of Pollution) Act. operations or processes shall not be carried out or shall be carried out subject to certain safeguards. empowers the Central Government to. the overall issue of equity shares to FIIs on a repatriation basis should not exceed 24% of post-issue paid-up capital of a company. Environmental Legislation Environment Protection Act. the State Pollution Control Board must be immediately alerted. Hazardous Wastes (Management and Handling) Rules. by order. water or soil for various areas and purposes and prescribing the maximum allowable limits of concentration of various environmental pollutants for different areas. The person in charge must affix meters of prescribed standards to measure and record the quantity of water consumed. laying down standards for emission or discharge of environmental pollutants from various sources. control and abatement of environmental pollution. restriction of areas in which any industries.

then the employer must pay a bonus proportionate to the salary or wage earned during that period. strike. irrespective of the existence of any allocable surplus. the occupier or the operator of the facility will have to pay for the necessary remedial and restoration work. 1952 (the “Employees Insurance Act”) mandates a provident fund. before making arrangements for the payment of dividend out of profit.500 per month may join the scheme with the consent of the employer. Payment of Bonus Act. and (f) Funeral Expenses.000 or both. 1965 Under the Payment of Bonus Act. 1972 Under the Payment of Gratuity Act. 1978. 1952 The Employees Provident Fund and Miscellaneous Provisions Act. family pension fund and deposit-linked insurance in certain establishments. The right to receive any payment of any benefit is not transferable or assignable and is not liable to 59 . (c) Disablement Benefit. for that period. which relate to the establishment itself. The minimum bonus under the Act must be paid. 1950 provide that the employer’s contribution to the Employees’ State Insurance Corporation shall be a sum equal to 4. similarly. retaining allowance and cash value of food concessions) towards the employees provident fund. The maximum amount of gratuity payable must not exceed Rs. 6. inter alia.000. been in uninterrupted service notwithstanding the fact that his service may have been interrupted during that period by sickness. The Employees State Insurance Act 1948 The Employees State Insurance Act. Contravention of the Act is punishable by up to six months imprisonment. The Employees Provident Fund Scheme framed under the Provident Fund Act requires the employers and employees to contribute an amount equal to 12% of the employees’ salary (consisting of basic wage. 1948 (the “Employees Insurance Act”) applies to all factories other than seasonal factories.500 per month are compulsorily required to join the provident fund scheme while employees earning above Rs. The benefits available to employees under the Employees Insurance Act include: (a) Sickness Benefit. The Provident Fund Act. lock-out or cessation of work not due to the fault to of the employee. Employees who earn less than Rs. leave. The Provident Fund Act is applicable to all factories engaged in an industry specified in Schedule I of the Act. Payment of Gratuity Act. a fine of up to Rs. lay-off. 6. It does not apply to employees drawing wages exceeding Rs. Any contribution payable under the Employees Insurance Act may be recovered as an arrear of land revenue. 1965. The Employees Insurance Act is applicable to establishments with a minimum of 10 employees in units which manufacture with the aid of power and more than 20 employees in establishments which manufacture without the aid of power as per a notification dated November 12. with dearness allowances. 1. subject to a maximum of 20% of such salary or wage.due to improper handling of hazardous waste. (d) Dependants Benefit. 7.75% of the wages payable to an employee. The funds established under the Employees Insurance Act vest in and are administered by the Central Board of Trustees and function within the overall regulatory control of the Central Government. (b) Maternity Benefit. • Appointment of an inspector to secure compliance under the Provident Fund Act. 1972. an employee in a factory is deemed to be in continuous service for a period if he has. death or disablement. Labour Legislation Employees Provident Funds and Miscellaneous Provisions Act. to those establishments which employ more than 20 persons or more and to those classes of establishments that have been notified by the Central Government. the employee shall be said to be in a period of continuous service for 12 months if he has worked at least 240 days in that period of 12 months and. superannuation. accident. shall be said to be in continuous service for a period of six months if he has worked for at least120 days in that period of six months. any damage is caused to the environment. An employee is eligible for membership to the scheme from the date he joins an establishment to which the Act applies. particular classes of employees or individual employees. absence without leave. Further. The Employees State Insurance (Central) Rules. If the allocable surplus exceeds minimum bonus payable. provides for: • Certain exemptions to the obligation to provide scheme(s) under the Provident Fund Act. An employee who has been in continuous service for a period of five years will be eligible for a gratuity upon his retirement. and • Mode of recovery of monies due from employers.75% of the wages payable to an employee and the employee’s contribution shall be equal to 1. “Allocable surplus” is defined as 67% of the available surplus in the financial year. an employee in a factory who has worked for at least 30 working days in a year is eligible to be paid a bonus. (e) Medical Benefits.500 per month. 350.

The average daily wage is defined as “the average of the woman’s wages payable to her for the days on which she has worked during the period of three calendar months immediately preceding the date from which she absents herself on account of maternity. However. 1970 (the “Contract Labour Act”) regulates the use of contract labour in certain establishments. by notification. or class of establishments. 4. The Contract Labour Act does not apply to establishments where only work of a seasonal nature is performed. 1970 The Contract Labour (Regulation and Abolition) Act. registration and licensing of factories. first-aid facilities and such wages as may be prescribed by the government. on any day of the preceding 12 months. or a woman working in any other establishment. 1948 applies. 80. 1961 (the “Maternity Benefit Act”) provides that a woman who has worked for at least 80 days in the 12 months preceding her expected date of delivery is eligible for maternity benefits. The maximum wage considered for the purposes of calculating the compensation is Rs. The Maternity Benefit Act stipulates that for this period of absence the woman must be paid maternity benefit at the rate of the average daily wage. Factories Act. Under the Maternity Benefit Act.attachment or sale in execution of any decree or order of any Court. 250 and additional leave for illness arising due to maternity. Any contravention may result in up to six months imprisonment or a fine of up to Rs. Establishments employing contract labour have certain obligations with respect to the welfare and health of contract labour. the woman entitled to maternity benefits is also entitled to a medical bonus of Rs. Where death results from the injury. Each State Government has rules relating to the prior submission of plans. operation or other work in any establishment. It applies to every establishment where 20 or more workmen are employed and to every person who acts as a contractor employing 20 or more workmen. Contract Labour (Regulation and Abolition) Act.000 or both. The Maternity Benefit Act does not apply to any factory or industrial establishment to which the Employees State Insurance Act. such as providing them with canteens. 90. The minimum wages generally consist of a basic rate of wages. or were employed. 1948 Under the Minimum Wages Act. A contractor is described as a person who in relation to an establishment undertakes to produce a given result or provide contract labour. 1923 provides that where personal injury is caused to a workman by accident during his employment.54 for a workman aged 16) and Rs. whichever is the highest”. 5. no compensation is required to be paid if the injury did not disable the workman for three days. 1923 The Workmen’s Compensation Act. the workman is to be paid the higher of 60% of his monthly wages multiplied by the prescribed relevant factor or Rs. prohibit the employment of contract labour in any process. Workmen’s Compensation Act. rest- rooms. the aggregate of which reflects the cost of living index. 1948. The government may also. or if he willfully disobeyed safety rules. Maternity Benefit Act.000. the maximum of which is 228.10. Minimum Wages Act. or the minimum rate of wage fixed or revised under the Minimum Wages Act. a woman working in a factory. the State Governments may stipulate the minimum wages applicable to a particular industry. 1948 or Rs. Contravention of the Maternity Benefit Act is punishable by imprisonment upto one year. mine or plantation or a woman working in a shop or establishment in which 10 or more persons are employed. 1961 The Maternity Benefit Act. his employer would be liable to pay him compensation.000. A person who fails to pay contributions shall be punishable with imprisonment which may extend to three years and fine. notified by the Central Government may take leave for six weeks immediately preceding her scheduled date of delivery and for six weeks immediately after her date of delivery. 500 or both. the workman is to be paid the higher of 50% of his monthly wages multiplied by the prescribed relevant factor (an inverse ratio to the age of the workman. Where permanent total disablement results from injury. cash value of supplies of essential commodities at concession rates and a special allowance. a fine of up to Rs. Establishments employing contract labour are required to be registered as a principal employer with the government and contractors employing contract labour are required to obtain a proper license from the government. 60 . obtaining their approval. 1948 (the “Factories Act”)defines a factory as any premises which employs ten or more workers and in which manufacturing process is carried on with the aid of power. 1948 The Factories Act. if the workman was at the time of injury under the influence of drugs or alcohol. Further. The Contract Labour Act also contains penal provisions laying down the penalty for contravening the provisions of the Contract Labour Act.000. and any premises where there are at least twenty workers even though there is or no electrically aided manufacturing process being carried on. Workers are to be paid for overtime at the overtime rates stipulated by the appropriate State Government.

Matters such as the spread-over in shops and establishments and the weekly holidays for employees have been specified in the act. seize and forfeit non-standard weight or measures. The specifications are given in the Standard of Weights and Measures (General) Rules 1987. health and safety measures and wages for overtime work. holidays. The act also contains provisions dealing with payment of wages to employees and leave with pay. containing the conditions of employment in the industry. If such contravention continues after conviction. the draft standing orders shall be certified by the certifying officer after hearing representations from the workmen or trade union of the industry and the employer. While the Weights and Measures Act is a central legislation. to a certifying officer. The act mandates registration of shops and establishments.000 or both. leave. The Packaged Commodities Rules 1977 framed under the Weights and Measures Act contains provisions laying down the norms to be followed. 1985. Once submitted. The act applies to local areas as notified by the government of each state. The Factories Act provides that an occupier of a factory (the person with ultimate control over the affairs of the factory and. There are various regulations that need to be observed to ensure the health and safety of the employees. The closing of the establishment needs to be notified to the inspector within 10 days of such closing. The Standing Orders Act also lays down certain penalties for contravening the provisions of the Standing Orders Act. safety and welfare of all workers. Industrial Employment (Standing Orders) Act and Regulations The Industrial Employment (Standing Orders) Act 1946 (the “Standing Orders Act”) requires every industry in which 100 or more workmen are employed and every industry notified by the government to submit draft standing orders. the same must be notified to the inspector. The Weights and Measures Act Act contains penal provisions for violating the provisions of the Weights and Measures Act Act. Product Related Legislation The Standard of Weights and Measures Act. The act prohibits the employment of children and regulates the employment of young persons and women in shops and establishments. 1968 (the “Insecticides Act”) and the Insecticides Rules. Any contravention may result in the occupier and the manager of a factory being punished by up to two years’ imprisonment. The Weights and Measures Act provides to prescribe specification of measuring instruments used in commercial transaction. The certified standing orders must be posted in a prominent place in the establishment by the employer. 1968 and the Insecticide Rules. daily and weekly working hours. 100. It also specifies the daily and weekly hours of work in shops and commercial establishments and the rest interval that must be provided to employees. 1976 (the “Weights and Measures Act”) aims at introducing standard in relation to weights and measures used in trade and commerce. when commodities are sold or distributed in packaged form in the course of inter-state trade or commerce. If there are any changes in the particulars supplied. Each state has passed its own Shops and Establishments Act to regulate conditions of work in the state. 1971 govern the sale. any of the directors) must ensure the health. Shops and Commercial Establishments Act The Shops and Establishments Acts regulate the conditions of work and employment in shops and commercial establishments and generally prescribe obligations in respect of inter alia registration. opening and closing hours. the occupier and the manager of a factory may be punished with a fine of up to Rs. Such draft standing orders must include provisions dealing with various matters relating to employment. The act provides for penalties for the contravention of various provisions under the Act and enhanced penalty in case of previous conviction under certain sections of the act. Insecticides Act. Under the Act. such as attendance and termination of employment. The Weights and Measures Act further lays down requirements for the physical representation of standard units. in the case of a company. A statement is required to be filed by the employer containing names. The Weights and Measures Act stipulates that every unit of weight or measure shall be based on the units of the metric system. industrial production and measurement affecting public health and human safety. the Government has created 61 . in the interests of consumer safety. There is a prohibition on employing children below the age of 14 in a factory. 1971 The Insecticides Act. its enforcement lies with the state governments through the Standards of Weights and Measures (Enforcement) Act. set out in Schedule I of the Standing Orders Act. The Weights and Measures Act also gives powers to inspectors to search. 1976 The Standard of Weights and Measures Act. The act regulates the opening and closing hours of shops and commercial establishments.000 per day of contravention. a fine of up to Rs. manufacture and distribution of substances containing insecticides. 1. category and other particulars of the establishment or shop of the inspector of the concerned local area within 30 days of the date on which the establishment commenced its work.

The Central Insecticides Board may advise on matters relating to the risk. or the rendering of services and the undertaking supplies or renders or proposes to supply or render not less than 50 per cent of its production or services. tooling or intermediates. 1951 (the “Industries Act”) empowers the Government to direct that an article shall be reserved for exclusive production by the ancillary or small scale industrial undertakings. as the case may be. sub-assemblies. or to undertake commercial pest control operations using any insecticide. Manufacture of items reserved for the small scale sector can also be taken by large/medium units. involved in the use of insecticides.the Central Insecticides Board. The Industries Act speaks of small scale industries and ancillary industries. and includes any article intended for use as a component of a cosmetic. sprinkled or sprayed on. inter alia. the licensing officer may. poured. storage. The licence granted shall be valid for the period specified therein and may be renewed from time to time for such period and on payment of such fee as may be prescribed. Any person desiring to manufacture. on such conditions and on payment of such fee as may be prescribed. transport and distribution of insecticides with a view to ensuring the safety of human beings or animals. that the licence holder has failed to comply with the conditions of the licence or has contravened any provision of the Act or the Rules. A Registration Committee. as the case may be. 1945. as envisaged by the Insecticides Act has also been established which. sale. Clause (2A) of section 29B of the Industries (Development and Regulation) Act. No person is allowed to stock or exhibit for sale. must apply to the licensing officer appointed under the Act for a licence.5 million. If such drugs are manufactured on more than one set of premises. distribute or cause to be transported. does not exceed Rs 10 million. beautifying. to human beings or animals. revoke or suspend the licence. if they apply for and obtain an industrial license and undertake to export 50% or more of their production. 50 million. after giving the licence holder an opportunity to show cause. Small Scale Sector Policy The Government follows a policy of encouraging growth of small scale industries. promoting attractiveness. which are defined to include industrial units where the investment in fixed assets in plant and machinery. or altering the appearance. The Rules provide that no cosmetic shall be manufactured which contains dyes. the human body or any part thereof for cleansing. 1940 and and the Drugs and Cosmetic Rules. whether held on ownership terms or on lease or by hire purchase. 62 . any insecticide unless it is packed and labelled in accordance with the provisions of the Insecticides Rules. colours and pigments other than those specified by the Bureau of Indian Standards and under the Act. to one or more other industrial undertakings and whose investment in fixed assets in plant and machinery whether held on ownership terms or on lease or on hire-purchase. An application must be made to obtain a license to manufacture for sale any ayurvedic (including siddha) or unani drugs. Section 3(aa) read with the proviso to Section 11B of the Industries Act provides that the following requirements are to be complied with by an industrial undertaking in order to be regarded as an ancillary industrial undertaking: An industrial undertaking which is engaged or is proposed to be engaged in the manufacture or production of parts. If the licensing officer is satisfied that a licence has been granted because of misrepresentation as to an essential fact. stock or exhibit for sale any insecticide. 1945 The sale. The licensing officer may grant a licence in such form. The Act defines “cosmetic” as any article intended to be rubbed. components. or introduced into. registers insecticides after scrutinizing their formulae and verifying claims made by the importer or the manufacturer. This list is reviewed from time to time and the Government issues notifications modifying the list of reserved items. Drugs and Cosmetic Act. sell. the safety measures necessary to prevent such risk and the manufacture. Such registration is compulsory for a person desiring to import or manufacture any insecticide. 1940 and the Drugs and Cosmetic Rules. distribute. The term tiny industry is not defined in the Industries Act but an industry in certain states like Assam and Tripura may be registered as a tiny industry if the investment limit in plant and machinery does not exceed Rs 2. does not exceed Rs. manufacture and distribution of ayurvedic soaps is governed by the Drugs and Cosmetic Act. as regards their efficacy and safety to human beings and animals. or otherwise applicated to. a separate application must be made and a separate license must be obtained for each premises.

211. started Jyothy Laboratories. Door No. 1992. Ramachandran starts Jyothy Laboratories as a proprietary concern in Kerala • Ujala is launched 1984 Ujala is sold house-to-house through a team of six sales people in the Trichur and Malappuram districts of Kerala 1986 Jyothy Laboratories releases its first print advertisement in the Kerala-based Mathrubhoomi newspaper 1987 • Jyothy Laboratories starts advertisements on radio • Jyothy Laboratories graduates to a formal distribution system • Jyothy Laboratories ventures out of Kerala to the neighbouring state of Tamil Nadu 1992 • Chennai factory is commissioned to make Ujala • Our Company was incorporated 1994 We commission the Pondicherry plant. Madhya Pradesh from Tata Chemicals Limited 2002 • We acquire our subsidiary. an oil-based antibacterial washing soap in Kerala 1997 We launch Ujala all over India 2000 • We launch Maxo (mosquito repellent) in the state of West Bengal • Exo. M. Key Milestones Year Event 1983 • Mr. Thrissur. our first in a backward area utilizing government incentives 1995 We launch Nebula. P. which has a mosquito coil production facility in Hyderabad • We launch Jeeva Ayurvedic Soap 2003 Maxo is awarded the “AAA Brand Performance Award” by the All India Advertisers Association 2005 • Exo Liquid and Ujala Stiff & Shine launched in south India 2007 • We start marketing and distributing coffee products under the brand name “Continental Speciale” in a joint venture with CCL Products (India) Limited • We enter into a joint venture agreement for the marketing of dhoop through a joint venture company Balajee Telebrands Limited • We enter into a deed of assignment of trademark and copyright for the brand “Ruby” • We enter into a deed of assignment of trademark and copyright for the brand “More Light” 63 . Mumbai 400 059. 1996. Shivshakti Industrial Estate. in Kerala. HISTORY AND CORPORATE STRUCTURE Our History In 1983. We were incorporated as Jyothi Laboratories Private Limited on January 15. 2002. our Promoter. Ramachandran. Mr. Tamil Nadu and Andhra Pradesh 2001 • We launch Vanamala washing soap in Kerala • We launch Maya incense sticks in selected states • We acquire the detergents plant at Pithampur. On September 13. M. in the intellectual property to us. We became a public limited company and our name was changed to Jyothi Laboratories Limited on October 6. which was involved in the business of manufacturing and selling fabric whitener under the name “Ujala”. Marol. our Promoter agreed to transfer his rights. is launched in Kerala and later launched across Karnataka. Andheri-Kurla Road. Kandanassery. and the rights of Jyothy Laboratories. 2000. 1995. P. Maharashtra on July 7. a sole proprietorship firm. Our Registered Office was moved from Ward 2. We further changed our name to Jyothy Laboratories Limited on August 12. an antibacterial dish wash bar. Kerala to 43. We used certain intellectual property on license from our Promoter. Sri Sai Homecare Private Limited.

dairy products.000 comprising 2. concessionaires or otherwise deal in all kinds and varieties of products used for or as personal care. mineral water and ayurvedic/herbal based products. 2007 The authorized capital of Rs. 100.000 Preference Shares was reclassified into 10. makers. agents. movers.000. wholesalers. processors.000. producers. preservers. indenters. air care.000.000. hair care.000.000 Equity Shares and 50.000 each was increased to Rs. 5.000.” September 7. cosmetic and beauty products. exporters.000 comprising 6. inventors. 5 each 64 . food and beverages. 100. exporters. 60. 5.000 Equity Shares with a face value of Rs.000 comprising 5. stockists. traders.000 Equity Shares and 50. 1997 The authorized capital of Rs.000 Equity Shares and 50.000 each October 7. 5.500. 5. importers. 1993 Our initial authorized capital of Rs.500. household insecticides. makers. packers.000 divided into 4.000 comprising 9. sub-agents.000 Equity Shares June 9.000 comprising 1.000 Preference Shares September 29.500.000 equity shares of Rs.000 Preference Shares December 24.000. 65. importers. distributors. 2000 The authorized capital of Rs. concessionaires or otherwise deal in all kinds and varieties of products used for or as personal care. surface cleaning.000 equity shares of Rs. whitening agents. movers. 65.000 Preference Shares October 22. hair care. traders. retailers. 2001 The authorized capital of Rs.000 equity shares of Rs.000 comprising 2. agents.000. suppliers. hygiene products and allied items. cosmetic and beauty products.000 Equity Shares and 50.000.000.000 Preference Shares was increased to Rs.500. sellers.000 each was reclassified and increased to Rs. 50. 5. washing aids. fabric care.000 Equity Shares of Rs. 1999 An amendment to reflect the move in our Registered Office from Kerala to Maharashtra February 1. food and beverages.000 each February 25.000. and (b) To carry on the business as manufacturers. 1997 The authorized capital of Rs. 2. consignors. 10.000. converters.000 equity shares of Rs. fabric care.000. producers. Changes in our Memorandum of Association The following changes have been made to our Memorandum of Association: Date of Shareholder Approval Changes July 24. 1995 Amendment to reflect our name change from Jyothi Laboratories Limited to Jyothy Laboratories Limited March 26. 5. retailers. distributors.000 Preference Shares May.000.000 Preference Shares was increased to Rs. dairy products. 1995 Amendment to reflect our name change from Jyothi Laboratories Private Limited to Jyothi Laboratories Limited pursuant to our change in status from a private limited company to a public limited company March 27. packers. soap powders. preservers.000 comprising 6.000 comprising 400 equity shares with a face value of Rs.000 comprising 5. jobbers.000 comprising 9. merchants. liquid whiteners.000.000. 27. brokers.000. 50. 1995 The authorized capital of Rs. household insecticides. buyers. stockists. buyers. processors.000 Preference Shares was increased to Rs. 2001 Alteration to the main objects clause to include the following object as a new clause 1A: “To carry on the business as manufacturers.500.000 comprising 10. consignors.000. sub-agents.Memorandum of Association Our Main Objects Our objects in our Memorandum of Association include: (a) To set up and carry out research and development for the manufacture and development of soaps. mineral water and ayurvedic/herbal based products. 10. 60. inventors. 100. 2002 The authorized capital of Rs. 5.000 Equity Shares and 50.000 equity shares of Rs.000 comprising 1. 10 and 50. suppliers. merchants. converters.000 Equity Shares and 50. wholesalers.000 each was increased to Rs.000 comprising 4. jobbers. air care.500.000 Equity Shares and 50. brokers. sellers.000. surface cleaning. indenters. 10 each was split into 20.

as on May 31.A. . . 74. Ullas Kamath and Mr. (7. . . setting up marketing and distribution networks for coffee. . . . . . . . 2007 and has its registered office at 7-1-24/2/D. .. . 5. .08 12. .039. . . . . 10. . . . as set out in its memorandum of association.) . .33 1. . are: (a) to manufacture. . . 2006 March 31. . acting as C&F agents or otherwise and to generally deal in all kinds of machinery. . I. . . . . distributing. . .60 Book Value (Rs. brokers. distributers. Board of Directors The board of directors of Sri Sai Homecare. Jeedimetla. .59 87. Its main objects. . . repellants and other related and allied products. . . and (d) to carry out the business of trading. . . . . . . 2007. . . . .35) Equity share capital (paid up) . . . . 2. distributing. stocking. . . . stocking. . Hyderabad. . . . G. . . . . coffee vending machines and marketing products supplied by CCL Products (India) Limited. 2007. . in million except per share data) Year ended Year ended Year ended March 31. . . . . . . . . — — — Debit balance of Profit and Loss Account . . which have a face value of Rs. . .68) (13. . formulations and their allied products. 5. repellants and their allied products.10 Reserves and Surplus (excluding revaluation reserves) . . . . . . . exporters of almost all varieties of coffee. . (b) to carry out the business of trading. . Equity Shareholding Pattern Sri Sai Homecare is our wholly owned subsidiary. . . Phase-I. . . . . . . 10 each. . Hyderabad. . ./share) . . Ameerpet.550 equity shares. . . . 47. . .20 Profit/(Loss) after tax . . .21) Sri Sai Homecare is an unlisted company and it has not made any public or rights issue in the three years preceding the date on which this Draft Red Herring Prospectus is filed. Continental Speciale (India) Private Limited Introduction CSPL was incorporated on May 10. . .39 Earnings/(Loss) per share (diluted) (Rs.500016. . . . it had an issued share capital of 1. .04) (4.38 (3. . . . . . comprised of Mr. . . . . exporting. . 2005 Total Income . . . T. . . . . Financial Performance (Rs. . . equipments and other related components and parts of mosquito coils. Greendale. (c) to manufacture all types of machinery. . .39 10. . 2007 March 31. . . .39 10. importing. . . . . 2002.Our Subsidiary and Joint Ventures Sri Sai Homecare Products Private Limited Introduction Sri Sai Homecare was incorporated on December 11. . . . . . acting as C&F agents or otherwise and to generally deal in all kinds of domestic homecare and healthcare products. 65 . As on May 31. K. . . . . . The equity shares of Sri Sai Homecare are not listed on any stock exchange. It has not become a sick company under the meaning of SICA and it is not under winding up. . . . . . . importing.83 70. . sell and distribute all types of mosquito coils. . . . . Andhra Pradesh. . include acting as traders. Andhra Pradesh. . importers. . . as set out in its memorandum of association. . . . .D. .22) (14. . the terms of which are summarized in the section titled “History and Corporate Structure—Material Contracts” on page 67 of this Draft Red Herring Prospectus. . 1996 and has its registered office at Plot No. . We acquired it from Yodeva Plastics (Private) Limited pursuant to an agreement dated February 19. .13 13. equipments and other related components and parts of mosquito coils. . . . . Its main objects. . .500 055. . . .55 1. . Pradosh. repellants and their allied products. exporting. .

K. selling. . . . . . . CSPL is an unlisted company and it has not made any public or rights issue in the three years preceding the date on which this Draft Red Herring Prospectus is filed. . . . . . . . . . . . . . . Balaji Telebrands Limited Balaji Telebrands was incorporated on November 8. 5. . . scented body sprays. CSPL is also part of our Promoter Group. . . . Ekta Kapoor . . exporting. C-13.R.000 100% 66 . . . . . . . 6. . . . perfumed idols. . . . . . 8. . . Jyothy on behalf of Jyothy Laboratories Limited . . . Mumbai 400 053.000 18% Mr. . . . . . . . . . . . . . . . . . . . . Ramachandran on behalf of Jyothy Laboratories Limited . incense. . . . . . . The equity shares of CSPL are not listed on any stock exchange. . . . . . P. 10 each Percentage shareholding Ms. . . . . . .50% Mr Ravi (Jeetendra) Kapoor . Board of Directors The board of directors of CSPL. . . . . . . . . . . . . . . . . . processing. . was as follows: Shareholder No of equity shares of Rs. . . . . . .50% Ms. . . . was as follows: Shareholder No of equity shares of Rs. 10. . . Financial Performance Since CSPL was only incorporated on May 10. . . . . . . . . . . . Jyothy on behalf of Jyothy Laboratories Limited . . . . . . 2006 and has its registered office at Balaji House. . . . . . . . . . 6. . as set out in its memorandum of association. . M. . 2007. Its main objects. Tusshar Kapoor . . . . . .50% Mr. . . .250 12. . . . . 2007. . . 50. . . . Shobha Kapoor . . . . 6. . . . . of its own brand as well as national brands and international brands. . . The terms of the joint venture are summarized in the section titled “History and Corporate Structure—Material Contracts—Joint Ventures” on page 68 of this Draft Red Herring Prospectus. . . 8. Andheri West. 9. .250 12. . . . . . . . .000 100% CSPL was set up as part of our joint venture with CCL Products (India) Limited. .50% Mr. . . .250 12. Challa Srikant on behalf of CCL Products (India) Limited.000 50% Mr. . It has not become a sick company under the meaning of SICA and it is not under winding up. . . . . . . . . as on May 31. . . . .Equity Shareholding Pattern The equity shareholding pattern of CSPL. . . . . . . . as on May 31. . . . importing agarbattis. hair oil. . . . . . . . . . . M. . . as on May 31. . M. . . . . . . 10 each Percentage shareholding Ms.000 16% Ms. . . .R. . . . Ullas Kamath on behalf of Jyothy Laboratories Limited . . . 5. . . Equity Shareholding Pattern The equity shareholding pattern of Balaji Telebrands. . . . . . . . . . . .Dalia Industrial Estate. . . . . . . R. . . . .000 16% TOTAL . comprised of Mr. 2007. . include manufacturing. . 6. . . . . . M. . . . New Link Road.250 12. . . . Challa Srishant and Ms. . . . . . . . . . information on its financial performance is not yet available. . . . . . . . .000 50% TOTAL . . . . . . . . . buying. . . . . . . . 2007. . . . . . . . . . . . . . Jyothy.

0. . Rama Mohan Reddy and Mrs. . 2007 as this unit has been making losses. . . . Ekta Kapoor. 2006 and its financial performance for the financial year March 31. . Balaji Telebrands is also part of our Promoter Group. . 2002. . . . . . 2007 is as follows: Year ended Year ended Year ended March 31. . . . . . . . . It has not become a sick company under the meaning of SICA and it is not under winding up. . . . . 2002. . The main activity at this unit was the manufacture of an oil-based soap which was marketed in Kerala only. .) .59 — — Debit balance of Profit and Loss Account . . 2005 (Rs. . . . . . . . Under our agreement with Tata. . .199. . . . 0. in million except per share data) Total Income . pursuant to which we purchased the entire issued share capital of Sri Sai Homecare. Balaji Telebrands was set up as part of our joint venture with Ms. . 2001 granted the necessary permission and agreed to recognize us as lessee of the land. . . . 2007 March 31. 2001 to transfer the leasehold interest in the plot to us and MPAKVN through letter AKVN:IND:INFRA: 2001:10082 dated December 6. . . comprised of Ms. 67 . ./share) . . . Ms. . . . . as on May 31. . We also agreed to bring in additional funds as an unsecured loan to clear dues of the creditors amounting to Rs. Mr. . Geeta Reddy dated February 19. . . . . . . . Kerala with effect from August 1. . . . . The equity shares of Balaji Telebrands are not listed on any stock exchange. . . . . . . . . Financial Performance Balaji Telebrands was incorporated on November 8. . . . . . . . K. . . . which comprised 1.50 — — Earnings/(Loss) per share (diluted) (Rs. 2006 March 31. . Further to the closure of the unit we expect to terminate the services of 71 workmen. . . V. . . . Divestments Our Company has filed a notice dated May 31. . . . . Board of Directors The board of directors of Balaji Telebrands. . Acquisition of Sri Sai Homecare We entered into a share purchase agreement with Yodeva Plastics (Private) Limited (“Yodeva”) on February 19. . . . . . . . 1947 to close down our unit located at Pannissery. . . . and a share purchase agreement with Mr. . . . . . . along with its plant and machinery on an “as is where is” basis for a consideration of Rs. . . . . . Under an indemnity agreement dated February 19. .420. . . .53 — — Profit/(Loss) after tax . . 0. . . Material Contracts Acquisitions Acquisition of Pithampur plant We entered into an agreement with Tata Chemicals Limited (“Tata”) on November 19. . . Pursuant to a deed dated March 28. . . . . . . 2001 pursuant to which we purchased a detergent manufacturing facility located at Pithampur in Madhya Pradesh. 2002. 10. . . Shobha Kapoor and Ms. . The terms of the joint venture are summarized in the section titled “History and Corporate Structure—Material Contracts—Joint Ventures” on page 68 of this Draft Red Herring Prospectus. . 2002. . . . . . . . 2007 under the Industrial Disputes Act. . .94 — — Balaji Telebrands is an unlisted company and it has not made any public or rights issue in the three years preceding the date on which this Draft Red Herring Prospectus is filed. . . . 28. Ekta Kapoor. . the land is now held in our name. ourselves and Tata agreed to approach MPAKVN for the transfer of leasehold rights in the land on which the manufacturing facility is located to us. .59 — — Reserves and Surplus (excluding revaluation reserves) . . 15. . Neetu Kashiramka. .550 equity shares of Rs. 11. . . 2007. . . . . . . . . 40 million. . . Yodeva has undertaken to indemnify us for any acts or omissions by Yodeva in respect of Sri Sai Homecare. Shobha Kapoor. . 10 each. . The land on which the plant stands had been leased to Tata by Madhya Pradesh Audyogik Kendra Vikas Nigam (“MPAKVN”) for a period of 90 years under a lease deed dated May 30. .82 — — Book Value (Rs. . 1991. Tata applied to the MPAKVN vide a letter dated October 12. . . . . . . Ullas Kamath and Ms. . . . . . — — — Equity share capital (paid up) . . . . .039.

Pakistan. 1. 7. CSPL was incorporated on May 10. CCL Products have agreed to produce instant coffee depending upon market requirements. the Assignor has assigned to us copyright in the brand Ruby for a total consideration of Rs. Additionally. for sale and distribution in the market. 8 million. will sell the coffee/coffee products in the market through anyone other than ourselves and/or CSPL. Joint Ventures Coffee joint venture with CCL Products (India) Limited Joint venture agreement We have entered into a joint venture agreement with CCL Products (India) Limited (“CCL Products”) on January 23. 1986 and goodwill of the business for a total consideration of Rs. 68 . Similarly. 2007. marketing. by a separate deed of assignment of copyright dated April 19. selling and distribution of liquid blue for a period of ten years. for further details see the section titled “History and Corporate Structure—Our Subsidiary and Joint Ventures” on page 65 of this Draft Red Herring Prospectus. by a separate deed of assignment of copyright dated May 31. the agreement will automatically terminate.Purchase of Emerald Packaging Pursuant to a resolution of our Board dated July 31. which shall be given to them by us and/or CSPL two months in advance every month. The assignors have granted us a power of attorney to initiate proceedings in connection with transfer of the trade marks and copyrights in favour of our Company. Neither party is entitled to assign. 2007.830479) registered in Class 03 in respect of washing soaps. sub-let or otherwise transfer the coffee joint venture agreement to any third party. 2007 under which we have agreed to work together for the manufacture and sale of coffee products in India. detergent cakes and powder along with the goodwill of the business for a total consideration of Rs. 449454) Class 3. the Proprietor of Bangalore Detergents and Plastic Company (the “Assignor”) for the assignment and transfer of the trademark Ruby (No. Acquisition of Ruby We have entered into a deed of assignment of trade mark with Ivan Nigli. Bangladesh. 2 million. Liquid Blue. Nepal and Sri Lanka and to develop brands that will be owned by a new joint venture company to be incorporated for this purpose. We are also in the process of acquiring trademarks and copyright for the More Light brand in respect of washing powder and personal care products. We agreed that the name of the joint venture company would be Continental Speciale (India) Private Limited (“CSPL”). The agreement will remain valid and effective unless it is terminated. The deed also covers two trademarks in respect of which the application for registration are pending.65 million and stocks of raw material and finished goods at cost and also assumed responsibility for all the permanent employees on the roll of Emerald Packaging. The Assignor has undertaken not to compete with the Assignee in India in the business of manufacture.5 million. we have agreed that neither we nor CSPL will deal with coffee products. 2007 the Assignor has assigned to us copyrights in various labels as well as allied right. CCL Products has agreed that neither it nor its affiliates. in which case assign or transfer the agreement is allowed without the prior written consent of the other party. If the shareholding level of either party drops below 10% of CSPL’s total paid-up equity capital. title and interest in the copyrights in the brand More Light for a total consideration of Rs. Additionally. unless that third party is an affiliate.5 million. We agreed to subscribe to the equity share capital of CSPL in 50:50 proportions and that the shareholding pattern shall be equal between the parties at all times. 1. registered on February 10. other than those of CCL Products. Acquisition of More Light We have entered into a deed of assignment for trademarks in respect of a fabric whitener with several persons who are partners of Modern Chemicals (India) (the “Assignors”) and Mod Chem (India) Private Limited (the “Confirming Party”) for the assignment and transfer of the trademark More Light (No. 2002 we purchased the plant and machinery of Emerald Packaging located in Pondicherry involved in the manufacture of corrugated cartons for a total consideration of Rs. We have initiated proceedings to register our name as the subsequent proprietor of the trade mark.

Dhoop joint venture with Balaji Telebrands Limited Joint venture agreement We have entered into an agreement (the “JV Agreement”) with Ms. Our Company shall be the sole distributor of Balaji Telebrands’ products and the marketing arrangement shall be governed by a separate agreement. In the event that the Kapoors exit from the joint venture. Balaji Telebrands will engage specifically in the distribution of Ekta’s karyasiddhi graha shanti dhoop and any other product that may be mutually agreed to by the parties and these shall be manufactured either by Balaji Telebrands or third party contractors as may be mutually agreed by the parties. will sell the coffee/coffee products in the market through anyone other than ourselves and/or CSPL. Ekta Kapoor shall be paid a royalty of 5% of the MRP value of the products of Balaji Telebrands for brand promotion and development. The JV Agreement shall continue to be in force until terminated as per the provisions of the agreement or till one party purchases all of the other party’s shares in Balaji Telebrands. selling etc. we have agreed that neither we nor CSPL will deal with coffee products. marketing and distribution agreement with CCL Products and CSPL on May 11. Bangladesh. The agreement will remain valid and effective unless it is terminated. Ekta Kapoor (“Kapoors”) dated February 1. The shareholding of the parties shall always remain equal unless otherwise specifically agreed upon by the parties. Balaji Telebrands to carry on the business of marketing. CCL Products has agreed that neither it nor its affiliates. spiritual idols. The agreement sets out the terms of distribution. our Company may continue to use the same distinct packaging as available now subject to payment of royalty to Ms. without the specific written consent of any party in this respect. 2007 wherein we have agreed to form a joint venture company. 69 . Balaji Telebrands shall not use the trade name and logo of the parties. in which case assign or transfer the agreement is allowed without the prior written consent of the other party. Ekta Kapoor’s name shall be under the brand name having the prefix “Ekta’s”. neither party shall sell. brands of all kinds and other products like agarbatties. Nepal and Sri Lanka under the brand name “Continental Speciale” and other brands owned by CSPL. We have agreed to prepare our monthly projected rolling forecast of sales and deliver it to CCL Products two months in advance. Ekta Kapoor for use of her photograph (2% of MRP). Ms. camphor. The Board of Directors shall initially comprise of two directors appointed by our Company and two by the Kapoors. breach of the agreement or any other conduct which occasions such loss. During the term of the agreement the parties shall neither carry on nor be involved in any activity or business being in material competition with Balaji Telebrands. shares can be sold at a price which will be equal to or lower than the Fair Market Value to be calculated in the manner provided in the JV agreement. use of her name (2% of MRP) and use of current style of packaging (1% of MRP). sub-let or otherwise transfer the coffee joint venture agreement to any third party. marketing and distribution agreement We entered into a manufacturing. photos etc. Neither party is entitled to assign. Pakistan. manufacturing. CCL Products has agreed to replace products that are damaged due to manufacture or transportation to us and unsold and expired stock. other than those of CCL Products. The JV Agreement provides that for a period of three years from the date of incorporation of Balaji Telebrands. CCL Products have agreed to produce instant coffee depending upon market requirements. transfer or otherwise dispose off their respective shares or any interest therein to anybody without the prior written consent of the other party. under which we agreed to purchase instant coffee from CCL Products for the purpose of marketing and distribution in India. net of taxes. The Maximum Retail Price (“MRP”) of the product shall be determined or altered with the mutual consent of the parties. Similarly. The products to be developed and promoted using Ms. unless that third party is an affiliate. for sale and distribution in the market. Each party shall indemnify the other for any losses due to misrepresentation. which shall be given to them by us and/or CSPL two months in advance every month. In case shares are sold to a third party. After the expiry of this period. the selling shareholder shall for a period of two years from the date of sale of its shares neither carry on nor be involved in any activity or business being in material competition with Balaji Telebrands. Manufacturing. Shobha Kapoor and Ms. 2007.

SARF. The Marketing Agreement provides that each party shall indemnify the other against all losses arising out of inaccuracy in or breach of the representations. SARF and Canzone subscribed to 9. In case of termination of the Marketing Agreement. certain of the representations. 2003.000 equity shares with a face value of Rs.250 equity shares held by Baring India.880 equity shares with a face value of Rs. ICICI Bank Canada and ICICI Bank UK (the “Common Agreement”) for the purpose of giving full and harmonious effect to the provisions of the two investment agreements described at items (ii) and (iii) above. 10 each. sub-let or otherwise transfer this Agreement without prior consent of the other party.000 convertible debentures in our Company. Our Company shall not without the prior written consent of Balaji Telebrands adopt or use any name.650. we entered into an investment agreement with ICICI Bank Canada. Canzone. Neither party shall be entitled to assign. SARF. We shall also prepare the monthly projected rolling forecast of sales and shall deliver the same two months in advance. or any other conduct or action of such party. including their right to information and their right to nominate Directors for our Board. our Company shall discontinue the marketing of the products and use of the specifications. pursuant to which CDC Financial Services (Mauritius) Limited. SARF and Canzone also purchased 558. Marketing and Distribution Agreement We entered into Marketing and Distribution Agreement (the “Marketing Agreement”) with Balaji Telebrands on March 1. On November 22.000 equity shares in our Company. The Marketing Agreement provides that Balaji Telebrands shall not sell or distribute products mentioned in the Marketing Agreement through any person or channel other than our Company and our Company shall not deal with these products other than those supplied by Balaji Telebrands. these convertible debentures were converted into 1. ICICI Bank UK. 70 . warranties and indemnities given under the two investment agreements shall survive the Offer and the listing of our Equity Shares. pursuant to which ICICI Bank Canada and ICICI Bank UK purchased 1. Balaji Telebrands shall be responsible for ensuring sufficient supplies of stock as per the indent given by our Company. CDC Financial Services (Mauritius) Limited. However. our Promoter and certain other of our shareholders. 10 each. Common Agreement On June 13. The Marketing Agreement provides that our Company shall distribute the products mentioned in the Marketing Agreement and shall discharge all market-related responsibilities. our Promoter and certain of our other shareholders. The rights set out in the investment agreements fall away upon listing of our Equity Shares. A similar obligation is also placed on Balaji Telebrands. (iii) Investment by ICICI Bank Canada and ICICI Bank UK On June 13. 2006. trademarks and other proprietary rights of Balaji Telebrands. 1999 our Promoter entered into an agreement with Baring India Investment Limited (“Baring India”) pursuant to which Baring India subscribed to 500. we entered into an investment agreement with CDC Financial Services (Mauritius) Limited. 2002. This agreement set out the rights of the various shareholders. The Marketing Agreement shall remain in force unless terminated. Canzone. 2007. 2006.656.433. Developing the brands for the products shall be the joint responsibility of both the parties. Shareholders’ Agreements (i) Investment by Baring India InvestmentLimited On November 17. commercial designation including trademark etc. (ii) Investment by CDC Financial Services (Mauritius) Limited. implying the identity of Balaji Telebrands or deal in products whose trade dress and trademarks are deceptively similar to that of Balaji Telebrands. we entered into an agreement with CDC Investment Holdings Limited. warranties etc. For further information see the section titled “Capital Structure—Notes to Capital Structure” on page 15 of this Draft Red Herring Prospectus. SARF and Canzone On August 22.

title and interest in the intellectual propery rights registered in. the agreements provide that the manufacturer will manufacture and sell and we will purchase the product.K. Limited. Manufacturing Agreements We have entered into agreements with third party manufacturers for the manufacture of Maxo mosquito coils. The agreements are typically for a period of three to five years and may be renewed for further periods by mutual consent. Canzone Limited. our Promoter was required to transfer the whole of his right. Typically. In case of termination. or pending registration in. The product is manufactured with the approved raw material composition and specification and approved packing material sourced from our approved suppliers at approved rates. his name or the name of Jyothy Laboratories. 2008. SARF and Canzone. Distribution Agreements Appointing distributors for our products We have entered into agreements to appoint super-distributors to distribute products to stockists and distributors appointed by or in consultation with us. We entered into an agreement with our Promoter on September 13. together with the associated goodwill.Supplemental Agreement Our Company entered into an agreement with ICICI Bank Canada. we have the sole and exclusive discretion to use or not use the artistic works in whole or part during the term of the copyrights. Assignment of Intellectual Property Our Promoter had licensed some trademarks and copyrights to us in two license agreements. 7 million for the trademarks and Rs. ICICI Bank U. Pursuant to the investment agreement with CDC Financial Services (Mauritius) Limited. 1994 and November 1. 2006 by February 28. While the key items of intellectual property are now registered in our name. 71 . 2002 agreement. for a consideration of Rs. M. 2007 or the shares of our Company do not commence trading on the relevant stock exchange. some of the intellectual property used by us is still registered in our Promoter’s name and the formalities of registration in our name have not yet been completed. Ramachandran and certain other existing shareholders on June 6. under which the intellectual property was transferred. the Agreement shall stand terminated. 3 million for the copyrights). and used by us into our name. on a principal to principal basis. Further. the manufacturers have undertaken to only use the information and data disclosed by us to manufacture the product and not to disclose it to any third party without our prior written consent. South Asia Regional Fund. If the initial public offering is not completed before December 31. Generally. see the section titled “Government Approvals—Trademark Licenses” on page 242 of this Draft Red Herring Prospectus. in such quantities and at such prices as shall be determined. We also entered into two separate agreements for the assignment of trademarks and copyrights pursuant to September 13. 2007. which were dated December 23. the manufacturer is responsible for manufacturing the products in accordance with the standards and specifications. For further details. The assignment was expressed to be absolute and for the unexpired residual term of the copyrights and in perpetuity. trade name etc.P. 2007 or any other mutually agreed date. The agreement shall prevail over the two investment agreements in case of inconsistency and the amendments made to the Articles of Association prior to the initial public offering and for the purposes of the initial public offering shall continue to remain in force. and to sell the product to any person in any territory in any manner and at any price. his sole proprietorship firm. 1999. The agreement shall become binding on all parties if the initial public offering of the equity shares of our Company is not completed on or before December 31. the Articles of Association shall be re-amended in order to restore the same to their form as on December 6. The agreements are on a non-exclusive basis and we are entitled to manufacture and buy the product or any similar goods from other parties. 2002. 10 million (Rs. such that we become the sole and absolute owner of all of the intellectual property rights free from encumbrances. CDC Investment Holdings Limited. The agreements provide that the manufacturer shall not have any right over any trademark. Under the agreements. used by us or to which we are entitled and that all such intellectual property remains with us.

visit all the offices/godowns/premises of the vendors and review the quality and supply parameters of those materials. trading name. If we decide to recall a product we are required to inform the super-distributor in writing. copy. distribute. All intellectual property rights in the formulations and services provided by Image Consultants under the agreements. R. Consultancy has agreed to provide business consultancy services to us and to coordinate the entire work and assist our operations department in relation to Exo household surface cleaning products. These distribution agreements are typically valid for one year and provide for automatic renewal for one year. This agreement is valid for a period of 10 years. in India under the brand name “Godrej Tea”. G. 2007. use any name. R. undertake various trade promotions. The distribution agreements provide that the super-distributor shall. We have agreed to indemnify GTL against all costs. The super- distributor bears reasonable costs incurred in complying or procuring compliance with requirements of the product recall and for any claims that arise as a result of the recall only in cases where the recall is caused by the failure of the super-distributor to handle. the use of the trademark and brand name “Godrej Tea” and any third party product liability claim relating to the product. in coordination with our operations department. without our prior written consent. and may then be renewed by the parties for further terms of 10 years upon such terms and conditions as the parties agree. G. use any other name owned by GTL or any mark that is confusingly or deceptively similar. We may at our sole discretion. Image Consultants has agreed to assist us. in relation to household insecticide products. GTL has agreed to indemnify us against all costs. except for sale and distribution to government and canteen department stores. 72 . GTL has also given us a first right of refusal to act as its distributor for the sale and distribution of that product to institutions and outside of India. Tea distribution venture with Godrej Tea Limited On November 8. in coordination with our operations department. we entered into an agreement with Godrej Tea Limited (“GTL”) under which we agreed to sell. G. Consultancy Agreements Consultancy agreement with Image Consultants On October 19. G. 2005. store or distribute the products in the required manner. employ/engage and maintain the necessary and adequate number of employees and personnel and. developed or conceived during the rendering of the services are to be immediately assigned to and vested in us upon creation of such rights. unless the other party gives us 90 days’ written notice of its intention to not renew its agreement. G. at its own expense. Consultancy On January 9. in relation to incense sticks. both inside and outside of India. infringement of. Under the other agreement. 2005. effective from November 8. These distribution agreements generally provide that the decision to recall any products is at our sole discretion. Consultancy has agreed to negotiate and finalise the rates of those materials with the vendors and ensure their timely supply. inter alia. we entered into an agreement with R. During the term of the agreement. Consultancy. losses. distribute. sell or deal in products with similar packaging or use or apply any trademark or other designation that is an imitation. GTL has undertaken not to. GTL has undertaken to ensure that the use of “Godrej Tea” does not infringe the right of any third party and agreed not to engage in the business of sale and distribution of the products in India. or confusingly or deceptively similar to any of GTL’s trademarks without our prior written consent. Image Consultants has agreed to assist us. maintain the necessary and adequate office premises with good infrastructure. imply the identity of GTL. title of an establishment including the trademark. Consultancy has undertaken to identify suitable vendors for supply of raw materials and packing materials. at its own expense. We are also GTL’s first preference to act as its distributor for the sale and distribution of third party products that they may sell or distribute at a later date. manufactured by GTL. damages and demands arising out of any breach our intellectual property rights. losses. market and promote tea. sale promotions and consumer promotions. we entered into two consultancy agreements with Image Consultants. in order to maximize business and sales turnover. Under one agreement. R. Under the agreement. manufacture. 2006. damages and demands arising out of any breach of GTL’s intellectual property rights and any third party product liability claim in relation to the product. Consultancy agreement with R.

provided by us as confidential information. Agreement with Interact Vision Advertising and Marketing Private Limited On July 1. Either party can terminate in the event of a breach or bankruptcy. we entered into an advertising agreement on a principal to principal basis with Mudra Communication Private Limited (“Mudra”) pursuant to which Mudra has agreed to provide us with advertising services and we have agreed to pay the higher of 1% of the release value or Rs. 2006. Either party can terminate in the event of a breach or bankruptcy. The agreement commenced on July 1. we have agreed to a sum equivalent to 8% of the net cost on the bills raised by the Interact Vision with respect to the cost they incurred in providing the services and a commission of 8% of the net cost of media releases for all releases we make. punitive. The agreement will continue to be operative unless terminated by either party giving 45 days’ written notice. design. Consultancy has undertaken not to provide service to any third party or deal in products in competition with our interests with respect to Exo household surface cleaning products. 2011 after which it may be renewed for further periods by mutual consent. special. 2.400. In consideration for their services. logos and other intellectual property rights used or associated with them. our products and our marketing strategy. we entered into an advertising agreement with Interact Vision Advertising and Marketing Private Limited (“Interact Vision”) under which we have appointed Interact Vision to conceive. Exo surface cleaning products and some of our other brands. Mudra is prohibited from providing similar services to anyone manufacturing products and that is a competitor of our Company during the term of the agreement without our prior consent. create and prepare creative work possessing artistic quality for the purpose of advertising and promoting Jeeva and personal care range of products. Both parties shall continue to own all trademarks. business names. Consultancy has also agreed not to divulge any confidential information that is made available to them and to treat all stationery. resource material etc. G. indirect or incidental damages in any way arising from the services. 2006. Both parties have waived any consequential.000 in a year. Consultancy are assigned to and vested in us upon creation of such rights. 2006 and shall be operative up to June 30. insolvency or winding up. R. insolvency or winding up. G. 73 . G. visualize. Mudra is under an obligation to keep confidential all information relating to the agreement. R. Mudra shall not be liable for the factual contents of the advertising material we approve that violates any law or other restrictions. Any intellectual property rights in the formulations and services provided by R. Advertising Agreements Agreement with Mudra Communication Private Limited On July 1. The agreement shall be operative unless terminated by either party giving 45 days’ written notice. Neither party is allowed to assign any of its rights or obligations under the agreement without the prior consent of the other party.

M.: 00023176 Mr. Ratilal Purshottam Shah Private Limited • Global Pharamatech Private Limited Address: 8-D. Palakal Velayudha Menon • Muthoot Leasing and Finance Limited Address: 5B J M Paradise Palarivattom. Borivali (East). Designation: Deputy Managing Director Occupation: Service DIN No.: 00553406 Mr. Designation: Executive Director Occupation: Service DIN No. • Infinity India Advisors Private Limited Designation: Non-executive. 202. The following table sets out our Directors details as of the date of filing this Draft Red Herring Prospectus with SEBI. Opp. independent Director Occupation: Retired banker DIN No. • Venture India Advisors Private Limited Arya Samaj. Designation: Chairman and Managing Director Occupation: Industrialist DIN No. M. Mumbai 400 066. Bipin R Shah 75 • Indus Capital MarketServices Company S/o Mr. Shri Krishna Nagar. M. Santacruz (West). Mehta 44 • Shaily Eng. No. Off Link Road. OUR MANAGEMENT Our Board of Directors We currently have six Directors. Renaissance Mangalam. 40 13th Cross. independent Director Limited Occupation: Chartered Accountant • Procyon Offshore Services Limited DIN No: 00006094 74 . Plastics Limited S/o Mr. Panjan Limited Address: Nikunj. K. K. Shri Krishna Nagar. • ITTI Private Limited Little Gibbs Road. Cochin 682 025 Designation: Non-executive. Kamath • Balaji Telebrands Limited Address: Flat No. R. Ullas Kamath 44 • Sri Sai Homecare Products Private Limited S/o Mr. Borivali (East). D. Bansilal Mehta • Panchmahal Steel Limited • Aavishkar India Micro Ventura Fund Address: 1/2 Saraswat Colony. M. IL. Ramachandran 60 • Sivasakthi Ayurvedic Research Centre S/o Late Mr. Ramachandran • Continental Special (India) Private Limited Address: 401 Nikunj. K. P. K. P.: 00199071 • Accutest Research Laboratories (India) Private Limited • E India Venture Holding Company Limited • Vikalpa Financial and Management Services Private Limited • E India Venture Fund Limited • E India Venture Fund Management Limited Mr. P. independent Director • Aureos India Advisors Private Limited Occupation: Business • Aureos India Trustees Private Limited DIN No. Mumbai 400 080. Malleshwaram. Mumbai 400 066. Details Age Other directorships Mr.: 00506681 Ms. Padmakumar 63 • Equity India Intelligence Private Limited S/o Mr. • Dolphin Offshore Enterprises (India) Limited Mumbai -400 006 • Kotak Asset Management Company Private Designation: Non-executive. • Marico Industries Limited Malabar Hill.: 00571828 Mr. Jyothy 29 • Sahyadri Agencies Limited D/o Mr. Nilesh B. Bangalore 560 003.Palazzo. V.

private equity and fund-related activities. 60. Bipin R. R. independent Director. He was previously a director with Hindustan Lever Limited and Lipton India Limited. 75 . is a non-executive. Nilesh B. during which he occupied the position of managing director of Meghraj Financial Services (India) Private Limited and executive director of Anagram Finance Limited. he was nominated by The Economics Times for “Entrepreneur of the Year Award”. Mr. 45. independent Director. Jain Institute of Management. Prior to joining us he was practicing as a chartered accountant. production and general management. He set up the Jyothy Laboratories business in 1983. sales. K. Mumbai. 29. He holds a bachelor’s degree from the University of Mumbai and is a qualified Chartered Accountant. He has over 36 years of experience in the commercial banking sector. She holds a bachelor’s degree in Commerce from the University of Mumbai and an MBA from Wellingker’s Management Institute. 75. He holds a postgraduate degree in Financial Management from University of Mumbai and began his career as an accountant in 1971 in Mumbai. Mehta. Mr. is a non-executive. He is a qualified Chartered Accountant and holds a postgraduate diploma in Management from the Indian Institute of Management. He has over 36 years of experience in sales. His responsibilities include business development. He has over 20 years of experience in investment banking. is our Deputy Managing Director. Ahmedabad. He is a qualified Chartered Accountant and Company Secretary and holds a bachelor’s degree in Law and master’s degree in Commerce. She has been on our Board since October 2005 and handles sales administration. M. is a non-executive. P. P. He is a Managing Partner of Aureos Capital and a General Partner of eIndia Venture Fund/Infinity II. Jyothy. He has also participated in the Advanced Management Programme at Wharton Business School. K. He has been on our Board since 2003. 63. Ramachandran. He has been associated with us since incorporation and has been on our Board since 1997. P. new projects. is an executive Director of our Company. marketing and brand communication.Brief Biographies Mr. 44. He started his career with the State Bank of India and has served as the chairman and chief executive officer of The Federal Bank. financial management and supervision of day-to-day operations. Mr. Mumbai and has undertaken a course in Family Managed Business Administration from S. M. Mr. Ullas Kamath. In 2003 and 2004. is our Chairman and the Managing Director. independent Director. Shah. He holds a bachelor’s degree in agricultural science and is a qualified Chartered Accountant. Ms. Padmakumar. He is currently associated with the Muthoot group.

P. 2004. superannuation fund and annuity fund. Perquisites • Rent free furnished accommodation with free use of all the facilities and amenities. such as air- conditioners.5% of the net profits of the Company and the commission. 2004 has been approved by a special resolution of the shareholders passed at an EGM held on May 20. 2004. electricity. including hospitalization. membership of any hospital and/or doctor’s scheme. Details of his remuneration are provided below: Salary At the rate of Rs. geysers. P. 2009. • Club membership. • Contribution to provident fund. 900. Ramachandran has been reappointed as our Chairman and the Managing Director with effect from April 1. 2004 for a term of five years. wherever applicable.Terms of Appointment Mr. • Any other perquisites as may become applicable in the future. salary and perquisites are subject to the overall ceiling laid down in sections 198 and 309 of the Companies Act and computed in accordance with the Companies Act with effect from April 1. • Leave travel allowance for self and members of family every year up to a maximum of one month’s salary. • Reimbursement of all medical expenses incurred for self and family. water etc. M. The remuneration payable to him with effect from April 1. The value of the perquisites (to be evaluated as per Income Tax Act. and at cost in the absence of any such rule) shall be subject to an overall annual ceiling of an amount equal to 50% of his salary for the relevant period. Mr. gratuity and encashment of leave at the end of his tenure. 2004. Use of car with driver and telephones for office purposes shall not be considered as perquisites. stove. which expires on March 31.000 per month from April 1. Ramachandran Under the terms of an agreement dated June 7. M. 2004 for a period of five years. 76 . gas. • Use of Company car with driver and telephones at the residence. Commission The amount of commission shall not exceed 1.

membership of any hospital and/or doctor’s scheme. 2005 has been approved by a special resolution of the shareholders passed at an EGM held on March 22. water etc. including hospitalization. 2005. salary and perquisites will be subject to the overall ceiling laid down in section 198 and 309 of the Companies Act and computed in accordance with the Companies Act with effect from April 1. 2005. stove. Commission The amount of commission shall not exceed 1. Use of car with driver and telephones for office purposes shall not be considered as perquisites. • Club membership. • Use of Company car with driver and telephones at the residence. 834. • Contribution to provident fund. Perquisites • Rent free furnished accommodation with free use of all the facilities and amenities. 2010. • Any other perquisites as may become applicable in the future 77 .Mr. gas. K. Ullas Kamath has been reappointed as a Whole Time Director with effect from April 1. geysers.000 per month from April 1. • Reimbursement of all medical expenses incurred for self and family. K. 2005 for a period of five years. up to a maximum of one month’s salary. Ullas Kamath Under the terms of an agreement dated April 7. 2005. Details of his remuneration are provided below: Salary At the rate of Rs. 2005 for a term of five years. gratuity and encashment of leave at the end of his tenure. electricity. which expires on March 31. superannuation fund and annuity fund. such as air-conditioners. • Leave travel allowance for self and members of family every year. Mr.00% of the net profits of the Company and the commission. The remuneration payable to him with effect from April 1.

• Use of Company car with driver and telephones at the residence. 2006 for a term of five years. The remuneration payable to her with effect from December 1. Other Directors In relation to other Directors of our Company. Details of her remuneration are provided below: Salary At the rate of Rs. 2007. geysers.Ms. water etc. • Reimbursement of all medical expenses incurred for self and family. up to a maximum of one month’s salary. R. 2007. Jyothy has been reappointed as a Whole Time Director with effect from December 1.000 per month on April 1 every year with the first such increase to take place on April 1. • Any other perquisites as may become applicable in the future Other benefits Entitled to the benefits of our Company’s personal accident insurance scheme. gratuity and encashment of leave at the end of her tenure. if any. see the section titled “Our Management—Board of Directors—Shareholding of the Directors” on page 80 of this Draft Red Herring Prospectus. trusts. gas. Ms. R. including hospitalization. Use of car with driver and telephones for office purposes shall not be considered as perquisites. 78 . partners. • Contribution to provident fund. as well as to the extent of other remuneration and reimbursement of expenses payable to them under our Articles of Association. superannuation fund and annuity fund. electricity. no remuneration is payable by the Company. Interests of Directors All of our Directors may be deemed to be interested to the extent of fees payable to them for attending meetings of the Board or a committee thereof. apart from sitting fees and reimbursement of expenses.000 per month from December 1. M. All of our Directors may also be deemed to be interested to the extent of any dividend payable to them and other distributions in respect of the said Equity Shares. 20. 2006. • Leave travel allowance for self and members of family every year. held by them or by the companies/firms/ventures promoted by them or that may be allotted or transferred to the companies. Jyothy Under the terms of an agreement dated February 22. firms. • Club membership. trustees or promoters. such as air- conditioners. Our Directors may also be regarded as interested in our Company to the extent of the Equity Shares. with an increase of Rs. 2006 has been approved by a special resolution of the shareholders passed at an AGM held on December 6. which expires on November 30. Perquisites • Rent free furnished accommodation with free use of all the facilities and amenities. details of which are disclosed above in the section titled “Our Management—Board of Directors—Terms of Appointment” on page 76 of this Draft Red Herring Prospectus. stove. members. 2006. in which they are interested as Directors. For details of the Equity Shares held by our Directors. membership of any hospital and/or doctor’s scheme. 2011. 100. M. and to the extent of remuneration paid to them for services rendered as an officer or employee of our Company.

K. The scope of this committee inter alia is: • To decide on the timing. save as disclosed elsewhere in this Draft Red Herring Prospectus. as required under law. syndicate members. in particular. modifications. pricing and all the terms and conditions of the issue of shares and to accept any amendments. directly or indirectly. Nilesh B. The Audit Committee’s terms of reference include the following: • Overseeing the Company’s financial reporting process and the disclosure of financial information. Shareholders’/Investors’ Grievances Committee Our Shareholders’/Investors’ Grievances Committee was constituted on June 6. brokers. or under which our Directors receive payment. This committee will address all grievances of shareholders/investors in compliance of the provisions of clause 49 of the Listing Agreement with the Stock Exchanges. the adequacy of internal controls. Nilesh B. P Padmakumar and Mr. We have a Board constituted in compliance with the Companies Act and the Listing Agreement with Stock Exchanges. Except as disclosed elsewhere in this Draft Red Herring Prospectus and. M. • To appoint and enter into arrangements with book running lead managers. variations or alterations thereto. Mehta (Chairman). Mr. P. escrow collection banks. in the section titled “Related Party Transactions” beginning on page 94 of this Draft Red Herring Prospectus. Mehta (Chairman). The corporate governance framework is based on an effective independent Board. in respect of corporate governance including constitution of the Board and committees thereof. The Board functions either as a full Board or through various committees constituted to oversee specific operational areas. our Directors do not have any other interest in our business. agreement or arrangement in which our Directors are interested. we have not entered into any contract. Bipin R. 2007. IPO Committee The IPO Committee was constituted on March 15. The Board has six Directors. Ullas Kamath. Our senior management provides the Board with detailed periodic reports on its performance. and in accordance with best practices in corporate governance. external and internal auditors. Shah and Mr. separation of the Board’s supervisory role from the executive management team and constitution of the Board Committees. Committees of the Board Audit Committee Our Audit Committee was constituted on June 6. 2007. • Review with management the annual financial statement before submission to the Board. The interests of our Chairman and Managing Director are set out in the section titled “Our Promoter and Promoter Group” on page 84 of this Draft Red Herring Prospectus. Corporate Governance We have complied with the requirements of the applicable regulations. None of our Directors have taken any loans from us and. 79 . K. The scope and function of the Audit Committee is in accordance with section 292A of the Companies Act and clause 49 of the Listing Agreement with the Stock Exchanges. Mr. including the Listing Agreement with the Stock Exchanges and the SEBI Guidelines. 2007. registrars. Ramachandran. The present members of our Audit Committee are Mr. legal advisors and any other agencies. underwriters. • Recommending the appointment and removal of external auditors and fixation of audit fees. and • Review with management. The present members of the Shareholders/Investors’ Grievances Committee are Mr. in the two years prior to the filing of this Draft Red Herring Prospectus.

. . M. . November 8. . Mehta (Chairman). Ramachandran. June 6. . . . . . . . . . 2005 Appointment Mr. . . 2007 Resignation Mr. . 2007 Appointment Mr. . . . . . . . . . . . . . . . . . . . Trivedi . . . Jyothy . . the escrow agreement and all other documents. . . . R. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . P. . . . . . .560 Borrowing Powers Under our Articles. . . . . . . Srinivas . . . . . . Ramachandran . . . . June 7. . . . . the underwriting agreement. . . . June 6. . Jyothy . . . . . . • To finalize and settle and to execute and deliver or to arrange the delivery of the draft red herring propspectus. . . . . . . . M. 2006 Appointment Mr. the syndicate agreement. . . . . P. . . .001. . . . . . . . . . . . . . . . . and • To make applications for listing of the Equity Shares on one or more stock exchanges and to execute and to deliver or arrange the delivery of all the necessary documents to the concerned stock exchanges. . . . . . . . . Ullas Kamath and Mr. . . G. . . raise or borrow or secure the payment of any sum or sums of money for the purposes of our Company. . . . . . . . . . . . . Josephine Price . . . . . . . . . . . . . . . . June 8. . K. . . . . . . . . . of Equity Shares Mr. 7. . . . . June 8. K. 2002. . . . . . . . . . . G. . . . . . . . . . . . our Board has been authorized to borrow money from time to time up to a limit not exceeding Rs. M. . . the red herring propspectus. 2005 Resignation Ms. . . . . . . . . . Mr. . . . . . . . June 8. 2007 Resignation Mr. . . . . . . .2007 Appointment Mr. . Shareholding of the Directors Under our Articles of Association. 2007 Resignation Ms. . at its discretion by a resolution passed at its meeting. . . . . M. . . . . . 453. . . P.500 million. Padmakumar . G. . . . . . By a special resolution passed by our shareholders at the AGM held on September 7. . . . . . . . . . . . . Bipin R. .M. . . . . . . . . R. . . . October 24. . . . Sriram Hariharan . from time to time. . . 2006 Appointment Mr. October 24. . M. . M. . the Board may. . . . . . . . P. . . . . . . . . . . . . . 2007 Resignation 80 . . 2007 Resignation Mr. . the prospectus. . . . . . . Divakaran .960 Ms. . . . . . . . . . Nilesh B. . . . . . . . . . . . . Sriram Hariharan . Santhakumari . . J. . . . . . . Changes in our Board in the last three years The following changes have occurred in our Board in the last three years: Name of Director Date Reason Ms. Srinivas . June 7. November 8. The present members of the IPO Committeee are Mr. . . . . . . . . . . . 1. . . Shah . . The list of Directors holding Equity Shares as of the date of filing this Draft Red Herring Prospectus is set out below: Name of Director No. . . . . . our Directors are not required to hold any qualification shares. . . . . notwithstanding that the money to be borrowed together with the money already borrowed by our Company (apart from the temporary loans obtained from our Company’s bankers in the ordinary course of business) will exceed the aggregate of the paid-up capital of our Company and its free reserves.

Ullas Kamath) Sales Finance. Jyothy) (M K G Varrier) GM-Sales (P R Jagdeeshan Nair) GM-Finance GM-Operations (R K Hebbar) (T Krishnan) GM-Sales (Ajith Kumar) AGM-Finance (Neetu Kashiramka) Mgr-Marketing Mgr-HR (Raghavendra K) (S Diwakar) . Organisation Structure Chart Board of Directors CMD (M P Ramachandran) DMD (K. Marketing Operations R&D Human Secretarial Resources and Accounts 81 Chief Financial Officer GM-Sales and Company Secretary Director VP-R&D (K N Jagdishan) (M L Bansal) (M.R.

Diwakar. His compensation for the last financial year was Rs. K. 50. K. G. His compensation for the last financial year was Rs.500. His current responsibilities include production. None of these Key Management Personnel are related to each other or to any of the Directors. T. and a postgraduate diploma in Industrial Engineering from Institute of Industrial Engineering. He has over 32 years of experience in the field of technical.983. Mumbai. 1. 1. His current responsibilities include supervision of accounts. 2. He is a qualified Chartered Accountant and Company Secretary. 796. His compensation for the last financial year was Rs. see the section titled “Our Management—Board of Directors—Brief Biographies” on page 75 of this Draft Red Herring Prospectus. 82 . 1. His current responsibilities include handling our human relations department. holds a bachelor’s degree in Commerce from Agra University. His current responsibilities include sales and marketing for the Kerala region. finance. His current responsibilities include designing and development of machinery. GM—Sales. holds a bachelor’s degree in Commerce from Bangalore University. His current responsibilities include research and development of new products.503. 50. Mr.644. 38 years. VP—Research and Development.502. 59. Her current responsibilities include supervision of accounts. R. He is a qualified Chartered Accountant and a Certified Public Accountant (USA).000. holds a bachelor’s degree in Commerce from Madras University and is a Certified Accountant from the Indian Institute of Bankers. Bansal. His current responsibilities include sales and marketing for the regions of Delhi and Tamil Nadu.532. R. Jagdeeshan. Jagdeeshan. His compensation for the last financial year was Rs 1. 52 years. 1. All of the Key Management Personnel below are permanent employees of the Company. He has over 16 years of experience in the field of finance and accounts and was associated with Praxair prior to joining our Company in September 2005. L. His compensation for the last financial year was Rs. He has over 23 years of experience in the field of marketing and was associated with Godrej Ltd prior to joining our Company in November 1986. Chief Financial Officer and Company Secretary. Mr. Mr. holds a master’s degree in Arts from Calicut University. GM—Business Development. 57.000.119. 33 years. Mumbai. S.100. K.000.000. holds a bachelor’s degree in Commerce from the University of Mumbai and is a qualified Chartered Accountant. Her compensation for the last financial year was Rs. Neetu Kashiramka. 45. accounts and secretarial and was associated with Asian Paints Limited prior to joining our Company in May 2002. He has over 18 years of experience in the field of marketing and joined our Company in January 1988. He has over 35 years of experience and was associated with Bank of India and Development Credit Bank prior to joining our Company in April 2003. 1. Mr.768.His current responsibilities include new business development. treasury and secretarial. Mr.150. Hebbar. holds a bachelor’s degree in Commerce from Osmania University and is a Certified Accountant from the Indian Institute of Bankers. Mr. She has over 10 years of experience in the field of finance and accounts and was associated with Kewal Kiran Clothing Limited prior to joining our Company in November 2000. Varier. Brief Biographies Mr. Ms. AGM—Finance. GM—Sales. finance and statutory audit. has been with our Company since July 2002. GM—Sales. T. procurement and logistics.532. He has over 33 years of experience in the field of sales and marketing and joined our Company in November 1988. Sunith Babu.733. Kolkatta.000. His compensation for the last financial year was Rs. N.Human Relations Development. His current responsibilities include sales and marketing for the eastern region. His compensation for the last financial year was Rs. holds a master’s degree in Chemistry from Pune University. His compensation for the last financial year was Rs. He has over 37 years of experience in the field of finance. Krishnan. 55. His compensation for the last financial year was Rs. M. operations and research and development and was associated with the Maharishi Institute of Ayurveda prior to joining our Company in April 2001. holds a master’s degree in Economics.450. 3. PGDBM from GIM. Head—Engineering Research and Development. holds a master’s degree in Commerce from Kerala and an MBA from Hyderabad. He has over 32 years of experience and was associated with the Bank of India and Development Credit Bank prior to joining our Company in July 2002. a postgraduate diploma in Chemical Engineering from BIET.424. P. finance and internal audit. 38. M. Mr. new project implementation and expansion. Manager. 1.Key Management Personnel For profiles of our executive Directors that are part of our Key Management Personnel. V. Mr. Ajith Kumar. GM—Operations.

. His compensation for the last financial year was Rs. R. . . . Senior Officer—Sales Administration . Hebbar . .000 50. . 51 years. . Except as disclosed below. . Pune.000 1. holds a bachelor’s degree in Commerce from Calicut University. . K. .450. . . Mr. His current responsibilities include factory administration. V. . . . . . . . 1. May 31. No. He has over 19 years of experience in the field of production and has been with our Company since November 1986. . P. 2005 Resignation Dipankar Banerjee . Except for the interests of our Directors.000 599. .. . . . His compensation for the last financial year was Rs. . . . . . . 583. .982. . .000 4. M. . . GM-Sales . . Mohammed Basheer. . . . 1.000 Changes in Key Management Personnel The following changes have occurred in our Key Management Personnel over the last three years: Key Management Person Date Reason K. inventory control and was associated with Dominion (UB Group) prior to joining our Company in August 2001. He has over 11 years of experience in the field of planning. Mr. . . . . . 1. . His current responsibilities include sales administration and operations. . . .000 3. 37 years. . . Head—Engineering Research and Development . 50. . . . holds a diploma in Electrical Engineering. . Sunith Babu. . . Shareholding/Interest of Key Management Personnel Except for the Equity Shares held by our Directors. . . . . Name and Designation Amount of Loan Obtained March 31. . . . . . . . His current responsibilities include media planning and buying. He has over 11 years of experience in the field of quality control and was associated with Godrej Sara Lee prior to joining our Company in September 2000. production and other related operations of factories. March 31. . Raghvendra . . . . . Mr. . . . holds a master’s degree in Business Administration from Kuvempu University and holds a postgraduate diploma in Advertising and Public Relations from Symbiosis College. 410. . . 2007 Resignation 83 . .500. . . . none of our Key Management Personnel have taken loans from the Company. Jagdeeshan. . .988. . . . He has over 10 years of experience in the field of media planning and buying and was associated with Lintas Mudra OMS prior to joining our Company in April 2004. . . . . . .000 2. . His compensation for the last financial year was Rs. . . . . .000 260. Vengadachalam. . T. G. . . Manager—Marketing Services. Mr. holds a master’s degree in Chemistry from Madras University. . . There is no bonus or profit sharing scheme for our Key Management Personnel. none of our Key Management Personnel hold any Equity Shares in our Company. .499. His compensation for the last financial year was Rs. and coordinating creative agencies and marketing initiatives. . . . . . . . . . Pradosh. which are disclosed in the section titled “Our Management—Board of Directors—Interests of Directors” on page 78 of this Draft Red Herring Prospectus. . . . 300. 45 years. Mr. G. 2005 Resignation R. November 25. Mr. . .000. . GM.940. . . . .000. . . . . . N. . .000 1. . T. September 21. Senior Officer—Sales Administration. . . Jagdeeshan. His current responsibilities include quality control across the country and development activities of new products. April 15. . . . . . . Krishnan. . . which are disclosed in the section titled “Our Management—Board of Directors—Shareholding of the Directors” on page 80 of this Draft Red Herring Prospectus. . . . costing. . . . 2004 Appointment Mohit Bhatia . . the Key Management Personnel do not have any interest in our Company other than the remuneration and benefits they are entitled to under their terms of appointment and reimbursement of expenses incurred by them during the ordinary course of business.440. . Mr. . . . . 2005 Appointment Pankaj Kumar . . Raghvendra K. . Amount Outstanding as on Sr. . . .000. . . .Operations . . Manager—Quality Control. .078. K. . . . Mr. . T. . . . . . . 33 years. . Mr. . . . . . 1. . . GM-Sales . Manager—Factory Administration. Pradosh. . T. . 2007 1. .992 5. . . . 1. . .

P. is the Chairman and Managing Director of our Company.Our Board of Directors” on page 74 of this Draft Red Herring Prospectus. Ramachandran Shed No. our Promoter entered into an agreement with us to transfer his rights to certain intellectual property that had. 2006 Mr. M. OUR PROMOTER AND PROMOTER GROUP Our Promoter Our Promoter is Mr. M. Our Promoter and one member of our Promoter Group. 244. 2002. M. 6. Interest in promotion of our Company Our Promoter and certain members of our Promoter Group own Equity Shares in our Company. some of the intellectual property transferred to us is still registered in our Promoter’s name and the formalities of registration in our name have not yet been completed. 5. For further 84 .000 July 29. On September 13. Ramachandran Shed No. Ground floor. We confirm that the details of the permanent account number. The details of their appointment and remuneration are disclosed in the section titled “Our Management—Our Board of Directors—Terms of Appointment” on page 76 of this Draft Red Herring Prospectus.495. Andheri (E).) June 29. are on our Board. P. M. SUBTOTAL 20. For more details. We have acquired the following property from our Promoter and the Promoter Group in the two years prior to the filing of this Draft Red Herring Prospectus: Consideration Date Name of vendor(s) Description of the property (Rs. 43. 2nd floor. Andheri (E). Andheri (E). 2006 Mr.000 Ms. 4.536. 2006 Mr.321. 2006 Mr. M. driving license number: MH-02 9012754. Mumbai. P. Mumbai. Andheri (E).090. M. M. G. Mumbai. M. up to that date. Ground floor. bank account numbers and passport numbers of our Promoter will be submitted to the Stock Exchanges at the time of filing this Draft Red Herring Prospectus. R. Ms. 44. 60 years (passport number: B2914618. G.000 Ms. Santhakumari Shivshakti Industrial Estate.000 Ms. June 29. Ramachandran Shed No. June 29.000 Ms. Ground floor. Andheri (E). Ramachandran. Santhakumari Shivshakti Industrial Estate.200. been used by us under license. M. M. G. Mumbai. voting identity card no. June 29. Santhakumari Shivshakti Industrial Estate. G. P. P. P. PAN: ADZPM3832E. Mr. 28. Ramachandran Shed No. M. While the key items of intellectual property are now registered in our name. P. Jyothy. M. Mumbai. G. M. 4. details of which are disclosed in the section titled “Capital Structure—Notes to Capital Structure” on page 15 of this Draft Red Herring Prospectus. please refer to the sction “Our Management.180. Ramachandran. Santhakumari Shivshakti Industrial Estate. Ramachandran Shed No.: MT/09/45/1069301). 2006 Mr. 5. 40.000 Ms. Santhakumari Shivshakti Industrial Estate. Ground floor.

. . . . . . . . . . . . . . . . Wife’s Brother Mr. . . . Daughter Ms. . P. Ratnavalli Ashokan . . . . . . P. . . . . . . . . . . . . . . . District Trichur. . . . . . . . M. . . . . Deepthi . respectively. . . . . . . Mother Mr. . . . . . . . . Wife’s Sister Ms. M. . . . . . . . . . . . . . . . . . . . . . . . . . . . Kerala. . . . . . . . . . . . . . . . . . . . . . . Payment of benefits to our Promoter during the last two years Except as stated in the section titled “Related Party Transactions” beginning on page 94 of this Draft Red Herring Prospectus. . Ramachandran (HUF) . . . . . . . . . . see the section titled “Related Party Transactions” beginning on page 94 of this Draft Red Herring Prospectus. . . . . . Brother’s Wife Ms. . . . . Wife’s Sister Ms. . . . . . . . . . . . . . . . . Sheena Radhakrishnan . . G. . . Santhakumari . . . . . . . . . . . . . HUF where our Promoter holds more than 10% Mr. . . . . . We use some of the Promoter Group entities to distribute our products. . . . . . . . . . . . . . . . . . . . Sujatha . . . . . P. K. For further details. . . . . . . . . . . Brother’s Wife Ms. .O. . . . . . . . Divakaran (HUF) . . . . . . . . . . . . . . . P. . . . Jyothy . K. . . Daughter Mr. . . . . . . U. . . . . . . . . HUF where our Promoter’s immediate relative holds more than 10% Mr. . . Guruvayoor P. . Promoter Group Individuals and HUFs In addition to our Promoter. . . . . . . . of this Draft Red Herring Prospectus. . . . . . G. . . . . . . . . . . . . . . . . Wife Ms. . . M. . . . . . Prabhavati Sivadasan . M. . . . . . Companies The details of companies forming part of our Promoter Group are as follows: Sivasakthi Ayurvedic Research Centre Limited Introduction Sivasakthi Ayurvedic Research Centre Limited (“Sivasakthi Ayurvedic”) was incorporated on April 22. . . . . . . . . . . . Sidharthan . . . . . Divakaran . . . . . . 85 . M. . . . . . . . . . . . . . Shobha Ravindran . . . . . . . . . . . . . Wife’s Sister Mr. . Brother Mr. . . . . . . Beena . . . . . . . B. . . . . . . . . .. . G. . . . . P. . . . M. . . . . . . . . . . . . . . . . . M. . . . . Sheeja Gangadharan . . Its registered office is located at XIX/130. . . R. . .details. K. . . For details of the transactions arising out of these distribution arrangements. . . . . . . . . . . . . M. . Wife’s Sister Ms. M. . see the sections titled “History and Corporate Structure—Assignment of Intellectual Property” and “Government Approvals—Trademark Licenses” on pages 71 and 242. R. . . . Geethanjali Apartment. . . . M. . . . . . there has been no payment of benefits to our Promoter during the two years prior to the date of filing this Draft Red Herring Prospectus. . . the following persons (being the immediate relatives of our Promoter and HUFs in which the Promoter and/or one or more of his immediate relatives holds more than 10%) are part of our Promoter Group: Name Relationship with the Promoter Ms. . . Valliyamma . . HUF where our Promoter’s immediate relative holds more than 10% Certain members of the Promoter Group in the table above hold Equity Shares in our Company. . P. Brother Ms. . . . . . . Shaji . . . . Wife’s Sister Ms. . . . . Sidharthan (HUF) . . . . . Mohanan . . . 2004. . . . . . . . . . . . . . . . see the section titled “Capital Structure—Notes to Capital Structure” beginning on page 15 of this Draft Red Herring Prospectus. . . . . Wife’s Brother Ms. . . . . . .

. . . 0. . .50 0. . . . 2007 2006 2005 Total Income .00% Ms. . . . directly or indirectly through others. . . . Ramachandran. . . . . 74 14. . .56 Sivasakthi Ayurvedic is an unlisted company and it has not made any public or rights issue in the three years preceding the date on which this Draft Red Herring Prospectus is filed. . . Ramachandran . . . . . . . . . R. . . Guruvayoor P. . . . .00 0. in million except per share data) Year ended Year ended Year ended March 31. surface cleaning. . . . . . . . . .56 935. . P. . . — — — Debit balance of Profit and Loss Account . . . . . . . . Its registered office is located at 699/N. . . . . — — — Reserves and Surplus (excluding revaluation reserves) . . 70 14. . . . . . . . . . . . . . . . M. . . . 73 14. . . Mr. . . . . . . . . . . . . . . . . . . . . . 500 100% The equity shares of Sivasakthi Ayurvedic are not listed on any stock exchange. . . . . . . M. . . . . . . . . 70 14. . . . Deepthi . . . P. M. . . . . . . . . . . 0. fabric care. . . . . . . . . . .O. . Santhakumari . .. . . . . . . .00 Equity share capital (paid up) . M. household insecticides. M. Sidharthan and Mr. . . . . . . . . . . . . . . . . . . . . Divakaran . . . . . . . . . . . patent. . .00 0. . . . . . . . . .50 0.60% Mr. . . . . . . . . . . P. . District Trichur. . . . . . . M. . . M. . . . . . . . chattels. . .00% Ms. . . . . .80% Ms. . . . . . . . . . 2005 and hence no activities were undertaken in the year ended March 31. . . . . 2004. . . . . . . .00% Ms. The financial results of Sivasakthi Ayurvedic for the last three financial years are as follows: (Rs. . 86 . . . . . . . . .) . personal care products. . . . . . . . . . . . . . . . . . . . of equity shares of Rs. 70 14. . . . K. G. the certificate of commencement of business was obtained only on January 28. . . . . Jyothy . — — — Book Value (Rs. Divakaran. . . . . . . . . . . R. . . . . P. . . 2003. . . . . . . . . Sidharthan . . . include acting as distributers and commission agents for all kinds and varieties of goods. . . . . includes research work of all kinds in the development of ayurvedic and herbal healthcare products or improving the products developed by Sivasakthi Ayurvedic to manufacture. . . . . . . . . Financial Performance Even though Sivasakthi Ayurvedic was incorporated on April 22. . sell. . . . . . . . K. . . hair care. . . . was as follows: No. . 70 14. .00% Mr. Sujatha . Board of Directors The board of directors of Sivasakthi Ayurvedic on May 31. . Its main objects. . . . . . . . . . . . . . . . . . . ./share) . . . . . Equity Shareholding Pattern The equity shareholding pattern of Sivasakthi Ayurvedic. . . . . . . . . . . whiteners. . . . . . . . . . . mercantile. . . . to produce commodities including consumer goods. 2007 comprised of Mr. . . March 31. . 1000 Percentage Shareholder each shareholding Mr. . . . . . . . Its main objects. . . . . . . . . . . . . .50 Earnings/(Loss) per share (diluted) (Rs. . . 935. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . P. . . .P. . . . . as set out in its memorandum of association. . . . . — — — Profit/(Loss) after tax . . . . . . . . . . . . . . . . . . . . . 2007. . . . . . . Kerala. . . . . . . . . . . . . Geethanjali Apartment. . . . . . air care. . .60% TOTAL . . as on May 31. . . . cosmetics and beauty products. . . . 73 14. . . . . . . . . . . . . M. . . 2005. . . . . . . . . . . . . March 31. . . . . . . . . . It has not become a sick company under the meaning of SICA and it is not under winding up. . . . . . . . as set out in its memorandum of association. . . . . . . . . . . . . . . . . . . market. . . . . . . Sahyadri Agencies Limited Introduction Sahyadri Agencies Limited (“Sahyadri”) was incorporated on July 9. lease and/or license those products. . . . M. . . .56 935. .

. . . . . . . . . . .44 Profit/(Loss) after tax . . Financial Performance The financial results of Sahyadri for the last three financial years are as follows: (Rs. .00 0. . . P. . . . Proprietorships The details of proprietorships forming part of our Promoter Group are as follows: Beena Agencies Introduction Beena Agencies is a proprietorship firm formed on November 24. . .14) 01. . . . Santhakumari . . The main office of Beena Agencies is located at Madhavi Nivas. . . P. Balaji Telebrands Limited Our joint venture. Divakaran . . . . . . Deepthi . . . . . . . .07 0. . . . . . M. . 100 14. . . . . ./share) . .70 Earnings/(Loss) per share (diluted) (Rs. . . . . Mr. . . . . . . . . . . . .70) 0. . . G. 100 14. . Podikundu. . .00 Debit balance of Profit and Loss Account . R. . . . 100 14. . . . 2007 2006 2005 Total Income . . . . . . . . . . . Beena . . Sidharthan. R. . . . . . M. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Kannur. . . Divakaran and Ms. . . . . . . . . . . . . . . . .03 0. 2007 comprised of Mr. . .29% Mr. . . . . . . . . . . M. . . . . . . . .19) 4. 0. . . . . . . 2007. . . . . . . in million except per share data) Year ended Year ended Year ended March 31. . . . . . . . . . It has not become a sick company under the meaning of SICA and it is not under winding up. . Continental Speciale (India) Private Limited Our joint venture. March 31. . . . . . . . . . . . . . . . . Kerala. . . . . . Board of Directors The board of directors of Sahyadri on May 31. . . . . . . . . . . . . . 0. . . . . . . . . . . . . .00 0. . . . U. M. R. . . . .22) (48. .03) 0. . . . . . . 885. . For further information about CSPL. . . . . . For further information about Balaji Telebrands. . . . . . Equity Shareholding Pattern The equity shareholding pattern of Sahyadri. . . . . . . . . . . P.04) (0. . . . . see the section titled “History and Corporate Structure—Our Subsidiary and Joint Ventures” on page 65 of this Draft Red Herring Prospectus. . . .29% Ms. . . . . . . M. . .76 Sahyadri is an unlisted company and it has not made any public or rights issue in the three years preceding the date on which this Draft Red Herring Prospectus is filed. M. . . . . . . . March 31. . . . CSPL. . . . . . K. 1. . . . . .29% Ms. . . . . . . . M. . . .000 each shareholding Ms. . . as on May 31. . . . .70 0. . . . . .29% Ms. P. .29% TOTAL . (0. . . is also a member of our Promoter Group. .92 930. . . . . . .29% Mr. . .46 11. . . . . . . . . . 100 14. . K. . . . . (0. . . . . Jyothy. . was as follows: No. . . . . .00 Reserves and Surplus (excluding revaluation reserves) . . . . . Sidharthan . . (0. . . . . . . . Balaji Telebrands Limited is also a member of our Promoter Group. 1992. . . 700 100% The equity shares of Sahyadri are not listed on any stock exchange. . . . . . 100 14. . . . . . . B. .29% Mr. . . . . . . . . . . . M. . . . . 87 . (53. . . . . . . . . . .89 Book Value (Rs. . . . . . . . . . . . . . . . . . . . . . . Jyothy . 100 14. 100 14. .36 969. . . . . .0 Equity share capital (paid up) . . . . . . . . see the section titled “History and Corporate Structure—Our Subsidiary and Joint Ventures” on page 65 of this Draft Red Herring Prospectus. . . . . . . . of equity shares Percentage Shareholder of Rs. . . . . .) . . Sujatha . .

. . . . . . . . . . . . . . . . dishwash bars. . . . . . . . . 3. . . . . . . . . . March 31. . . . . . . . . . . . . . . . . . . . . dishwash bars and powder. . . . . . . . . . . . . . . . .46 Capital . . . . . . .35 3. . . U. . . . . . . . . . . . . . . . . . . . Kerala. . . Its main object is to act as a wholesale dealer in fabric whitener. . 1989. . . . . . . . . . . . . . . . . . . . . . . Kerala. . . .43 65. . . . . . . Deepthi . . . . . . . . . . . . . Mangalapuram. 100% Financial Performance The financial results of Beena Agencies for the last three financial years are as follows: (Rs. . . . . . . . . . . . . Its office is located at Thannakkal. .58 Travancore Trading Corporation Introduction Travancore Trading Corporation is a proprietorship firm formed on February 14. . . . . . . . . . . . . 100% Financial Performance The financial results of Deepthi Agencies for the last three financial years are as follows: (Rs. . . . . . . 88 . . . . . . . . . . . detergent powder.24 Deepthi Agencies Introduction Deepthi Agencies is a proprietorship firm formed on July 28. . . . . . . . . . . . . . . . . 100% TOTAL . . . Thiruvanathapuram. . . . 2007. . . . . . . . . . . . . . . . was as follows: Percentage Proprietor interest Ms. . . . . Calicut. . . R. . . . . . . washing soap. . . . . March 31. . . . . . . . . . . . . 2007 2006 2005 Total Income . . as on May 31. . . . . . . .74 40. . . . in million) Year ended Year ended Year ended March 31. Its office is located at 23/1169 A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1. . . .84 Capital . Cotton Mill Road. . . . . . . . . . . Beena . . 2007 2006 2005 Total Income . . . . . . . . . . . . .64 Profit/(Loss) after tax . . B. in million) Year ended Year ended Year ended March 31. 1. . . . . . . . . . . . . . . 9. . . . . . . . . . Its main objects are to act as wholesale dealers in fabric whitener. . . . . . . . . . . . 2001. . . . .55 64. . . . . . . . Ownership The ownership of Deepthi Agencies. . . . as on May 31. .49 1. . washing soap and powder. . . was as follows: Percentage Proprietor interest Ms. agarbattis and scrubber pads. March 31. . . . . . . . agarbatti. . . Thiruvanoor. . 2007. . . . 68. . . . . . . . . . . . . Ownership The ownership of Beena Agencies. scrubber pads. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42 5. toilet soaps and detergent powder.30 8. .92 7. . . . . . 100% TOTAL . . .01 40. . .77 1. . . . . . .43 Profit/(Loss) after tax . . . . . . . . . . . . .34 1. . . . .27 0. 49. M. . March 31. . . . . . . . . . .

.47 60. . . . . .59 Profit/(Loss) after tax . . as on May 31. . . . . . . . . . . . Ownership The ownership of Srihari Stock Suppliers. Its main object is to act as a wholesale dealer in fabric whitener. . . . . . . . . . . . . . . Coimbatore. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . mosquito coils. . . . . dishwashing bars. The office of Sahyadri Agencies is located at Kumeranellur. . . . Jyothy . . in million) Year ended Year ended Year ended March 31. . . . . . . .90 28. . . . 10. . . . . . . . . Thirunavakarasu Nagar. . . . . . . . . 00. . . . . . . . . . . . 89 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Sidharthan . . . . . . . . . . . . as on May 31.40 (0. . . . . . . Tamil Nadu. 00. . . . . . . 100% Financial Performance The financial results of Srihari Stock Suppliers for the last three financial years are as follows: (Rs. 31. . . 100% TOTAL .69 Srihari Stock Suppliers Introduction Srihari Stock Suppliers is a proprietorship firm formed on March 27.84 0. . .61 5. . 100% Financial Performance The financial results of Travancore Trading Corporation for the last three financial years are as follows: (Rs. . P. . . . . 84. . .73 52. . toilet soaps and washing powder. . . . . . . . . washing soap. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . agarbatti. . . . . . . . . . . . . . . . . . . . . . . .04) Capital . . . . . . . . . . . . . . . 2007. . . . . . scrubber pads and mosquito coils. dishwash bars. . . March 31. . . . . . . March 31. . . . . . . 6. . . . . . . . was as follows: Percentage Proprietor interest Mr. . . . . 100% TOTAL . . . 7. . . . in million) Year ended Year ended Year ended March 31. 2007. . M. . 1997. . . . . . . M. . . . . Kerala. .48 Profit/(Loss) after tax . . . . was as follows: Percentage Proprietor interest Ms. . . . . . March 31. . . . . . .14 25. . . . . . . . . . .29 0. . . . 2007 2006 2005 Total Income .93 5. . . 1989. . R. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . March 31. . . . . . . . . . 2007 2006 2005 Total Income . agarbatti. . . . . . . . . Its main object is to act as a wholesale dealer in fabric whitener. . . . . . . . . . . . .94 Capital .32 5. . . .45 5. . . Kuniamuthur. scrubber pads. . . Kottayam. . . . . . . . . . . .21 Sahyadri Agencies Introduction Sahyadri Agencies is a proprietorship firm formed on May 8.78 0. . . . . washing soap. . . . . . . . . . . Ownership The ownership of Travancore Trading Corporation. . . . . The office of Srihari Stock Suppliers is located at No. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . 0. . . . . . . . .20 Patnerships The details of partnerships forming part of our Promoter Group are as follows: M.23 0. . . . in million) Year ended Year ended Year ended March 31.11) (0. . . . . . . . . . . . . . . . . . . March 31. . . . March 31. . . . . . .61 56. . . . . . Divakaran . . scrubber pads and toilet soaps. . . . . . . . . . . toilet soaps etc. . . . . . . . . . P. . . . . . . . . . . . . . . . . . . . . . . was as follows: Percentage Proprietor interest Mr. . P. . as on May 31. . . . . 100% Financial Performance The financial results of Sahyadri Agencies for the last three financial years are as follows: (Rs. . 18. . .65 Profit/(Loss) after tax . . . . . . . . . . . . . . . . . . . Sulaksmi. . . . . . . . . in million) Year ended Year ended Year ended March 31. .26 0. . . . . . . P. P. . 7. . . . Palayamkottai. . . . Kandanassery. . . . . . . . . . . . . . . . . Its main object is to act as a wholesale dealer in fabric whitener. . 100% Financial Performance The financial results of Sujatha Agencies for the last three financial years are as follows: (Rs. 2007. . . . . . . . . . 30th Street. Agencies is a partnership firm formed on October 1. . . . . Divakaran . . . .14 Profit/(Loss) after tax . . . . . mosquito coils. . . . agarbatti. 4/795-F. . . . . . . . . . . . P.31 64. . . . . .09 8. . . Ownership The ownership of Sahyadri Agencies. . . . 00.52 8. 0. . . . . Agencies Introduction M. . . . . . . . . . 100% TOTAL . . . . . . . . Kerala. . . . . Its main object is to act as a wholesale dealer in fabric whiteners. .75) Capital . . . . 100% TOTAL . . . . . M. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .38 0. . . . . . . . . washing soap and powder. . . .42 Sujatha Agencies Introduction Sujatha Agencies is a proprietorship firm formed on May 8. . . . . . . . . scrubber pads. . . . was as follows: Percentage Proprietor interest Mr. . . . . . . . . . . . . . . . . . . . . Santhi Nagar. . . . . . . . . . . . Tamil Nadu. . . . . . . . . . agarbatti. . .07 12. . . . . . . . . . . washing soap and powder. M. dishwash bars. . . . . . . . . . . 2007 2006 2005 Total Income . . 1995. . . . District Trichur. 90 . . . . Parish Road. . The office of M. . as on May 31. .64 0. . . . . . . dishwash bars. . The office of Sujatha Agencies is located at No. . Agencies is located at 249/11. . 1991. March 31. . . . . . . . . . . . . mosquito coils. . . . . 72. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Ownership The ownership of Sujatha Agencies. . . . . . . . . . . . . . . . . . . . . . .16 Capital . .57 (0. . . . . 2007 2006 2005 Total Income . .31 14. . . . . . . . . March 31. . 2007. . . . . . . . . . . .

. 7. . . . 1992. P. . .70 4. . . . . . . . . . . . . . . . . . . Kerala. . . . . . . . . . . The office of the firm is located at Shanvaz Shopping Complex. . . . . . . . . . . . . . . . . . . . . . . . . . 20% TOTAL . . . . . Tamil Nadu. . . . 00. . . . . Its main object is to act as an agent. . . . . . . . . . . . . . . The office of the firm is located at Charles Nagar. . . . . . . K. . . . . . . P. . . . in million) Year ended Year ended Year ended March 31. . . . . . . . . . . . . . . . . . . Valliamma . Sujatha . 2nd Street. . . . . . . . March 31. . . . . . . . . . . K. . . . . . .70 6. . . . . . . . . . . . . . . . . . . . 2007. .10 45. .79 Tamil Nadu Distributors Introduction Tamil Nadu Distributors is a partnership formed on December 7. . . . . . . . . . . . . . . . . . . . . . March 31. . .62 29. . . . . . . . . . . . . . . . . . . Ownership The ownership of Sri Guruvayurappan Agencies. . . . . . . . . . . 100% Financial Performance The financial results of M. . . . . . . . . . . . . . . . . . . . . . . . . P. . . . was as follows: Percentage Partner interest Mr. . . . . . . . . . in million) Year ended Year ended Year ended March 31. . . . . . . . P. . . . . . . . . . . . . . . . . . . . . . 40% Ms. . 0. . . . . . . . . . . . . . . . . . . . dealer and stockist for Ujala and Nebula products. . . . . . . . . . . . Trichur. . .00 37. . . . . . .55 5. March 31. . . . dealer and stockist for Ujala products. . Agencies. Pudukottai. 2007 2006 2005 Total Income . . . . . . . . . . . . 2007. . . . . . . . . Divakaran . . . . . . . . . . . . .74 Profit/(Loss) after tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . stationery items and all consumer products and to carry on any other business which the partners find to be advantageous and in the best interest of the firm. . .13 51. . . . . . . 40% Mr. . . . .82 1. . . . . . M. . . . stationery items and all consumer products of Jyothy Laboratories Limited. 50. . . . .00 Capital . . . . . . . . . as on May 31. . Agencies for the last three financial years are as follows: (Rs. . . . .47 Capital . . . . . . . . . . . . . . . . Karakkad. . . 50% TOTAL . . . . . . . . . . . . . .96 0. . . . . . . . . P. . . . 7. . . The main object of the firm is to act as an agent. . . .24 3. . . . . . . . . March 31. . . . Guruvayoor. . . . . . . . . . . . . . . P. . . . . . . . . . . . . . . . . . . . . Sidharthan . . . . . . . . . M. . . . . . . 100% Financial Performance The financial results of the firm for the last three financial years are as follows: (Rs.72 0. . . . . as on May 31. . . . was as follows: Percentage Partner interest Mr. . . . . . . . . . 43. 2007 2006 2005 Total Income . . . . . . . 91 . . . . . . Ownership The ownership of M. . . . . . . 1990. . . . . . . . . . . . . . . . . . . . . . . K. . . . . . . . . . . . .53 Sri Guruvayurappan Agencies Introduction Sri Guruvayurappan Agencies is a partnership firm formed on September 30. . . . . .77 0. M. . .08 Profit/(Loss) after tax . . . . . . 50% Ms. . Divakaran . . . . . . . . . . . . . . . . . . . . . . . . . . .

. Vamanan . . . .83 Profit/(Loss) after tax . . .57 6. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . March 31. . . . . . . . . . . . . as on May 31. . . . . . . . . . . . . . . . 9/662. . . 47. . . . . 1. . . . The main object of the firm is to act an agent. . . . . Ownership The ownership of Quilon Trading Company. . . .90 Profit/(Loss) after tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1991. . . . March 31. . . 2007 2006 2005 Total Income . . . . . . . . . . . . .56 Capital . . 50% Mr. . . . . . . . . . Quilon. . . . . . . . . .49 0. . . . . . . . . . . stationery items and all consumer products and to carry on any other business which the partners find to be advantageous and in the best interest of the firm. . . . . . . . . . . . . . . . . . . . . . . . . 0. . . . 48. . . . . .19 38. . . . . . . . . . . . . . was as follows: Percentage Partner interest Mr. . . . . Kerala. . . . . . . 33. . . . . .40 (0. in million) Year ended Year ended Year ended March 31. P. . 33. . . . . . . . . M. . . . . . . .08 0. . . . . . . . . . . . . . The main object of the firm is to act as an agents. . . . . . . . . 2007 2006 2005 Total Income . . . . . . Ownership The ownership of Tamil Nadu Distributors. . . . . . . . . . . . . . T. . . . . . . . . . . . . dealer and stockist for Ujala products. . . . . . . . . . . . . . . . . . . 2007. 5. . . . .41 50. Sidharthan . . . . . .24 4. . . . . . . . . . . . .71 92 . . . . .73 5. . . . . . . . dealer and stockist for Ujala products. . . . . . A. . . . . . . . . 9. . March 31. . . . . . . . . . . . . . . . . . C. . . . . . . . . Kundara. . . . .80 0. . . . . . . . . . . . . . . . . . . . . .04 31. . . . . . P. . 50% TOTAL . . . . . . . . . . . . . . . . . . . . . . N. . . . . . . . in million) Year ended Year ended Year ended March 31. . . . . . . . Perumbuzha. . . . . . . . . . . . . . . . Radhakrishnan . . . . .26) Capital . . . . . The office of the firm is located at Door No.33% Mr. . . . . .15 7. . . .87 Quilon Trading Company Introduction Quilon Trading Company is a partnership formed on December 10. . . . . . . . 2007. . . . . Divakaran . . . . . . . . . . . 33. . . . . as on May 31. . . . . . . . . .33% TOTAL . . . . 100% Financial Performance The financial results of the firm for the last three financial years are as follows: (Rs. Divakaran . . March 31. . . . .47 43. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . P. . . . . . . . . . . 100% Financial Performance The financial results of the firm for the last three financial years are as follows: (Rs. . . M. . . . . . . . . . . . . . . . . . . was as follows: Percentage Partner interest Mr. stationery items and all consumer products and to carry on any other business which the partners find to be advantageous and in the best interest of the firm. . . . . . . M. . .33% Mr. . . . . . . . . . . . . . . . . . . . . . .

. .50 0. . . . . . . . . . . . . March 31. Geetha Divakaran and Mr. . . This could be a potential source of conflict of interest. . Beena and Ms. .02 Capital . . Ms. Ms. . . . . . . . . . . .P.P. March 31. . . . . . M G Santhakumari. Financial Performance The financial results of the HUF for the last three financial years are as follows: (Rs. . . . . . . . . M P Siddharthan. . . . . . . . . . .88 2. . . M P Divakaran.M. . .67 M. . . . in million) Year ended Year ended Year ended March 31. Ramachandran—HUF The members of this HUF are Mr. . . . . . . . . . . . Ms. . . . . 93 . . . . . . .45 0. .02 Capital . . S. 2007 2006 2005 Total Income . .23 1. . . . K.P. . Ms. . 1. 3. . in million) Year ended Year ended Year ended March 31. . . . . . 2. March 31. . . . . K. . . . . Financial Performance The financial results of the HUF for the last three financial years are as follows: (Rs. . . . 5. . March 31. . . . . . .95 1. . . .61 1. Divakaran—HUF The members of this HUF are Mr. . . . . .29 0. . . March 31. . . Sidharthan—HUF The members of this HUF are Mr. . . . . . .21 0. . . . . . . . . . . 1. . . partnership and proprietorship firms in our Promoter Group are engaged in the distribution of our products and may engage in business activities similar to those undertaken by our Company. March 31. . . . U. .23 0. . . . . . in million) Year ended Year ended Year ended March 31. . . Srihari.77 Companies/ventures with which the promoter have disassociated in the last three years The Promoter has not dissociated himself from any company/venture in the last three years. . . . . . . . . . . . . . . . M R Jyothy and Ms. . . . . . Financial Performance The financial results of the HUF for the last three financial years are as follows: (Rs. . 2007 2006 2005 Total Income . . . M P Ramachandran. . . . . . Jitin Divakaran. . . B. . . 02.00 Capital . . . . . . . . . . . . . . . M R Deepthi. . . 2007 2006 2005 Total Income . . Companies engaged in similar pursuits Some of the companies. .83 1.14 00. . . . . . . . .19 M.65 2. . . . . . . . . . . . Ms. . . . . . . . Sujatha. . . . . . . . . . . . . .

97 15.07 Claim for Enterprises in which Sreehari Stock Suppliers 2.G.G.02 55.17 — — — — — Ananth Rao T.34 60.85 — — — — Premises under Construction (at book Relatives of Individual M.12 140.38 — — Write off of old Enterprises in which Shanti Industries — — 0.Divakaran 0.05 — — — — value) having Control Purchases of Individual having Control M.46 67.80 6.P.53 70.41 2.30 40.P.14 Others 145.33 Sujata Agencies 56.50 2.50 0. Sidharthan — — — — 14.P.P.80 10.32 — — 9.81 46.34 Tamilnadu Distributors 35.76 — — — Personnel Assignment of Individual having Control M.40 47.33 Personnel Commission Individual M.54 — finished Products (P) Limited goods Joint venture company Balaji Telebrands 10.90 1.97 47. Ramachandran 8.10 10. June 30.07 7.P.85 82.21 2.71 13.79 — — for Sale Tamilnadu Distributors 0.94 5.P.R.50 1.10 6.93 1. Ullas Kamath 2.16 48. Ramachandran 43.39 11. Divakaran — — — — 9.58 52.55 61.79 18.00 11.27 0.07 114.11 — — reimbursement relatives are interested Sujata Agencies 1.31 — — — having Control Sale of Enterprises in which Beena Agencies 52.Deepthy 0. Santhakumari — 5.20 0.P.26 45.81 59.25 — — — — — shares Limited Dividend Individual having Control M. March 31.20 1.04 60.14 39.14 Remuneration Individual having Control $ M.19 — Products (P) Limited Enterprises in which Quilon Trading Co.66 95.20 1.76 35.93 Finished relatives are interested Sree Guruvayurappan 37.05 5.60 0. Ullas Kamath 7. Ramachandran 3.11 1.20 1. 0.05 — — — — Key Management K.86 84.37 — — — — — and Products (P) Limited machinery Purchase of Individual having Control M.60 M.08 20.84 1.63 relatives are interested Relatives of Individual M.73 65.04 33.R. RELATED PARTY TRANSACTIONS The following are details of transactions with related parties (Amount INR Million) Nine Fifteen months Year Year months Year Year ended ended ended ended ended ended March 31.54 168. Ramachandran — — — — 10.00 58.89 173.47 155.26 15.62 7.74 packing relatives are interested materials Shanti Industries — — — — — 0.63 — M.67 1.18 — — — — having Control M.30 3.82 — — Expenses Others 2.63 — — — having Control Key Management K.05 7.P.15 — — having Control M.P.46 1. June 30.91 3.25 — — — Relatives of Individual Others 19.38 98.00 7. Sidharthan 0.01 5.65 — — Promotion Beena Agencies — 0. Santhakumari — 6.04 64.28 — — — outstanding relatives are interested 94 . March 31.40 — Fixed Assets Wholly Owned Subsidiary Sri Sai Home Care 0.93 82.27 1.01 8.30 0.87 — — — 0.83 59.14 50. Particulars Nature of Relationship Name of the Related Party 2007 2006 2005 2004 2003 2002 Purchase of Wholly Owned Subsidiary Sri Sai Home Care 78.07 54. June 30.67 — Sale of plant Wholly Owned Subsidiary Sri Sai Home Care 7.87 — M.07 50.51 10.20 1.00 — intangible assets Investment in Joint venture company Balaji Telebrands 0. Jyothy # 0.65 46. Ramachandran — 20.53 — — — — — Limited Purchase of Enterprises in which Emerald Packaging — — — — 9.26 42.P.90 1.00 Relatives of Individual M. Ramachandran — 7.46 0. — — — — — 1.45 Goods Agencies Sreehari Stock Suppliers 68.

(Amount INR Million)
Nine Fifteen
months Year Year months Year Year
ended ended ended ended ended ended
March 31, June 30, June 30, June 30, March 31, March 31,
Particulars Nature of Relationship Name of the Related Party 2007 2006 2005 2004 2003 2002
Amounts Subsidiary Company Sri Sai Home Care 57.53 35.12 43.88 53.36 48.78 —
receivable Products (P) Limited
Enterprises in which Sahyadri Agencies Ltd. — — 0.34 — — —
relatives are interested Beena Agencies — — — — 2.76 5.98
Sree Guruvayurappan — — — — 2.18 0.18
Agencies
Quilon Trading Co. — — — — 3.12 0.36
Travancore Trading — — — — 0.62 0.14
Corpn
Emerald Packaging — — — — 0.10 —
M.P.Agencies — — — — 2.55 1.03
Sahyadri Agencies — — — — 1.30 0.76
Sreehari Stock Suppliers — — — — 6.98 6.96
Sujatha Agencies — — — — 17.04 1.97
Tamilnadu Distributors — — — — 16.90 7.12
Shanthi Industries — — — — 0.28 0.28
Individual having Control M.P. Ramachandran — — — — — 5.88
Key Management Personnel K. Ullas Kamath — — — — — 3.26
Relatives of Individual M.P. Sidharthan — — — — — 15.00
having Control M.P. Divakaran — — — — — 8.70

Amounts Joint venture company Balaji Telebrands Limited 4.84 — — — — —
payable
Individual having Control M.P. Ramachandran 3.07 7.94 5.63 — 3.63 —
Key Management Personnel K. Ullas Kamath 2.05 5.30 3.76 — 2.16 —
Relatives of Individual M P Divakaran 0.13 0.07 — 0.30 — —
having Control M P Sidharthan — — — 0.07 — —
Others — — — — 4.07 —
Enterprises in which Beena Agencies 1.53 1.79 2.04 4.55 — —
relatives are interested Quilon Trading Co. 0.54 1.33 0.28 1.58 — —
Travancore Trading 0.10 0.56 0.49 1.58 — —
Corpn
Sree Guruvayurappan 2.18 1.59 1.83 1.28 — —
Agencies
M.P.Agencies 2.44 1.51 0.78 0.75 — —
Sahyadri Agencies 0.10 0.60 0.09 0.57 — —
Sreehari Stock Suppliers — 0.01 0.05 0.51 — —
Sujatha Agencies 0.03 0.17 0.14 0.17 — —
Tamilnadu Distributors 0.07 0.02 0.04 0.01 — —
Deepthy Agencies 2.92 2.44 1.94 1.99 0.08 0.03
Sahyadri Agencies Ltd. 0.60 0.49 — — — —
Emerald Packaging — — — — — 0.35

$ As the managing director of the company is an individual having control and hence not separately disclosed
as a key management personnel.
# Director w.e.f. October 24, 2005

95

DIVIDEND POLICY

We have declared and paid cash dividends on our Equity Shares in the last five financial years. Details of
those dividends are provided in the table below.

The declaration and payment of dividends is recommended by our Board and approved by our shareholders,
at their discretion. It depends on a number of factors, including, but not limited to, our earnings, capital
requirements and overall financial position. We have no stated dividend policy.

This is not indicative of our dividend policy or dividend amount, if any, in future.

Nine months
ended
March 31,
2007* FY 2006 FY 2005 FY 2004 FY 2003
(Rs. in Million)
Face value of equity shares (Rs. per share) . . . . . . . . . . . . . . . 10 10 10 10 10
Dividend (Rs. in million) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72.57 90.71 21.78 Nil 14
Dividend tax (Rs. in million) . . . . . . . . . . . . . . . . . . . . . . . . . . 10.18 12.73 2.94 Nil 1.79
Dividend per equity share (Rs.) . . . . . . . . . . . . . . . . . . . . . . . . 10 12.50 3.00 Nil 2.50
Dividend rate (%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100% 125% 30% Nil 25%

* Interim dividend declared by our Board on March 15, 2007.

96

SECTION V: FINANCIAL INFORMATION
FINANCIAL STATEMENTS
Auditors’ report
(as required by Part II of Schedule II to the Companies Act, 1956)
To
The Board of Directors
Jyothy Laboratories Limited
43, Shiv-shakti Industrial Estate,
Andheri-Kurla Road,
Marol, Andheri (East),
Mumbai – 400 059.
Dear Sirs,
We have examined the financial information of Jyothy Laboratories Limited (‘the Company’) as at
March 31, 2007, June 30, 2006, 2005, 2004 and March 31, 2003 and 2002, annexed to this report, prepared by
the Company and approved by the Board of Directors, in accordance with the requirements of:
a. paragraph B(1) of Part II of Schedule II to the Companies Act, 1956 (‘the Act’);
b. the Securities and Exchange Board of India (Disclosure and Investor Protection) Guidelines 2000
(‘the Guidelines’) and the related clarifications issued by the Securities and Exchange Board of India
(‘SEBI’) as amended to date,
c. the terms of our engagement agreed upon with you in accordance with our engagement letter dated
May 26, 2007 in connection with the offer document being issued by the Company for its proposed Initial
Public Offer; and
d. the Guidance Note on Reports in Company Prospectuses (Revised) issued by the Institute of
Chartered Accountants of India (‘ICAI’).
This report is being issued for incorporating the same in the offer document, to be issued by Jyothy
Laboratories Limited in connection with the proposed offer for sale of equity shares by the shareholders.

Financial information as per the audited financial statements:
The financial information of Jyothy Laboratories Limited has been extracted by the management from the
financial statements of Jyothy Laboratories Limited for the years / periods ended March 31, 2007, June 30, 2006,
2005, 2004 and March 31, 2003 and 2002 and approved by the Board of Directors. Audit for the year ended
March 31, 2002 was conducted by previous joint auditors, M/s Vasu & Shivram and M/s A. R. Sodha & Co. and
accordingly reliance has been placed on the financial statements audited by them for the said year.
In accordance with the requirements of Paragraph B of Part II of Schedule II of the Act, the SEBI
Guidelines and terms of our engagement agreed with you, we further report that:
a) The Summary Statement of Assets and Liabilities, as restated, Summary Statement of Profits and
Losses, as restated and Summary Statement of Cash Flows, as restated (‘Restated Financial Statements’) of
the Company, as at and for the years / periods ended March 31, 2007, June 30, 2006, 2005, 2004 and
March 31, 2003 and 2002, examined by us, as set out in Annexure I, II and III to this report are after making
adjustments and regrouping as in our opinion were appropriate and more fully described in Notes on
adjustments for Restated Financial Statements and Significant Accounting Policies for Restated Financial
Statements (Refer Annexure IV and IVA).
b) Based on our examination, we are of the opinion that the restated financial statements have been
made after incorporating:
• the impact arising on account of changes in accounting policies adopted by the Company as at and
for the period ended March 31, 2007 applied with retrospective effect in the restated financial
statements;
• adjustments for the material amounts in the respective financial years to which they relate, except
to the extent stated in note 5 in Annexure IV;
• the qualifications and material adjustments relating to the relevant previous years / period.
c) There are no extraordinary items which need to be disclosed separately in the restated financial
statements.

97

Other Financial Information:
At the Company’s request, we have examined the following financial information proposed to be included
in the offer document prepared by the management and approved by the Board of Directors of the Company and
annexed to this report relating to the Company, for the years/ periods ended March 31, 2007, June 30, 2006,
2005, 2004 and March 31, 2003 and 2002:
i. Details of Rates of Dividend, enclosed as Annexure V;
ii. Capitalization Statement as at March 31, 2007, enclosed as Annexure VI;
iii. Statement of Accounting Ratios, as restated, enclosed as Annexure VII;
iv. Details of Loans, enclosed as Annexure VIII;
v. Details of Other Income, enclosed as Annexure IX;
vi. Statement of Tax Shelters, enclosed as Annexure X;
vii. Statement of Transactions with Related Parties and Details of Outstanding Balances, enclosed as
Annexure XI.

In our opinion, the financial information as disclosed in the annexures to this report, read with the respective
significant accounting policies and notes disclosed in Annexure IV and IVA, and after making adjustments and
re-groupings as considered appropriate and disclosed in Annexure IV, has been prepared in accordance with Part
II of Schedule II of the Act and the Guidelines.

This report should not be in any way construed as a reissuance or redating of any of the previous audit
reports issued by us or by other firm of Chartered Accountants, nor should this report be construed as a new
opinion on any of the financial statements referred to herein.

This report is intended solely for your information and for inclusion in the Offer Document in connection
with the proposed public offer of the Company, and is not to be used, referred to or distributed for any other
purpose without our prior written consent.

For S.R. Batliboi & Associates
Chartered Accountants

Per Sudhir Soni
Partner
Membership No: 41870

Place: Mumbai
Date: June 6, 2007

98

Annexure I: Summary Statement of Assets and Liabilities, as restated

(Amount INR Million)

As at As at As at As at As at As at
March 31, June 30, June 30, June 30, March 31, March 31,
PARTICULARS 2007 2006 2005 2004 2003 2002

A. FIXED ASSETS
Gross Block . . . . . . . . . . . . . . . . . . . . . . . 1,218.78 1,064.08 942.33 740.19 644.49 376.68
Less: Accumulated depreciation and
impairment . . . . . . . . . . . . . . . . . . . . . (274.67) (240.02) (193.96) (112.54) (66.16) (42.78)
Net Block . . . . . . . . . . . . . . . . . . . . . . . . 944.11 824.06 748.37 627.65 578.33 333.90
Capital work in progress (including
capital advances) . . . . . . . . . . . . . . . . . 547.46 75.29 85.63 195.88 135.29 235.40
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,491.57 899.35 834.00 823.53 713.62 569.30
B. INTANGIBLE ASSETS . . . . . . . . . . . . 8.58 9.79 11.06 13.34 17.15 —
C. INVESTMENTS . . . . . . . . . . . . . . . . . . 17.31 17.06 26.06 30.96 34.21 101.30
D. CURRENT ASSETS, LOANS AND
ADVANCES
Inventories . . . . . . . . . . . . . . . . . . . . . . . . 290.91 236.02 180.39 193.12 186.51 118.57
Sundry debtors . . . . . . . . . . . . . . . . . . . . . 629.71 320.99 334.10 261.10 570.88 257.49
Cash and bank balances . . . . . . . . . . . . . . 689.10 1,277.23 891.59 599.33 752.33 258.63
Other current assets—Sales promotion
items . . . . . . . . . . . . . . . . . . . . . . . . . . 2.90 3.25 2.85 2.89 2.83 13.74
Loans and advances . . . . . . . . . . . . . . . . . 208.21 137.87 238.72 237.04 240.03 179.25
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,820.83 1,975.36 1,647.65 1,293.48 1,752.58 827.68
E. LIABILITIES AND PROVISIONS
Secured loans . . . . . . . . . . . . . . . . . . . . . . 0.01 0.01 0.01 33.65 1,027.43 67.80
Unsecured loans . . . . . . . . . . . . . . . . . . . 1.66 1.17 0.33 — — —
Current liabilities . . . . . . . . . . . . . . . . . . . 391.94 229.18 270.27 201.55 250.81 281.72
Provisions . . . . . . . . . . . . . . . . . . . . . . . . 49.68 69.47 40.24 20.23 36.55 24.64
Deferred tax liability, net . . . . . . . . . . . . 58.45 57.37 27.04 — 33.23 12.93
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . 501.74 357.20 337.89 255.43 1,348.02 387.09
Net worth (A+B+C+D-E) . . . . . . . . . . . 2,836.55 2,544.36 2,180.88 1,905.88 1,169.54 1,111.19
Net worth represented by
F. Share capital . . . . . . . . . . . . . . . . . . . . . . 72.57 72.57 72.57 72.57 56.00 56.00
G. Reserves and surplus . . . . . . . . . . . . . . . . 2,763.98 2,471.79 2,108.31 1,833.31 1,113.54 1,055.19
Net worth (F+G) . . . . . . . . . . . . . . . . . . 2,836.55 2,544.36 2,180.88 1,905.88 1,169.54 1,111.19

The above statement should be read with the notes on adjustments for restated financial statements and significant accounting
policies as appearing in Annexure IV and Annexure IVA respectively.

As per our report of even date

For S.R. Batliboi & Associates For Jyothy Laboratories Limited
Chartered Accountants

Per Sudhir Soni M.P. Ramachandran
Partner Chairman and Managing Director
Membership No: 41870

Place: Mumbai
Date: June 6, 2007
Place: Mumbai
Date: June 6, 2007

99

Annexure II: Summary Statement of Profits and Losses, as restated
(Amount INR Million)
Nine months Fifteen months
ended Year ended Year ended ended Year ended Year ended
March 31, June 30, June 30, June 30, March 31, March 31,
PARTICULARS 2007 2006 2005 2004 2003 2002
INCOME
Sales (gross) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,295.10 3,661.53 3,175.51 3,463.34 3,140.22 2,571.36
Less: Sales tax recovered . . . . . . . . . . . . . . . . . . . . . (173.75) (194.44) (203.50) (206.27) (160.39) (76.24)
Less: Excise duty recovered . . . . . . . . . . . . . . . . . . . (58.30) (58.65) (45.40) (70.26) (54.13) —
Less: Trade discount (refer note no. 5(b) of
annexure IV) . . . . . . . . . . . . . . . . . . . . . . . . . . . . (286.70) (389.15) (273.13) (242.86) (99.24) —
Net sales (refer note no. 8 of annexure IV) . . . . . . . 2,776.35 3,019.29 2,653.48 2,943.95 2,826.46 2,495.12
Other income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102.80 121.14 60.29 57.10 31.96 21.72
Total Income (A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,879.15 3,140.43 2,713.77 3,001.05 2,858.42 2,516.84
EXPENDITURE
Materials consumed . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,501.35 1,458.61 1,394.10 1,675.42 1,465.38 947.99
(Increase)/Decrease in finished goods/work in
progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (9.62) 1.39 16.05 (41.05) (6.55) (10.15)
Employee costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 296.57 336.26 271.00 249.85 179.97 156.24
Operating and administrative expenses . . . . . . . . . . . . 326.20 404.80 302.86 417.85 320.27 270.22
Advertisement and publicity . . . . . . . . . . . . . . . . . . . . 225.48 266.91 292.34 487.54 519.08 487.60
Sales promotion and schemes . . . . . . . . . . . . . . . . . . . 48.70 18.28 13.38 298.06 115.31 348.29
Provision for doubtful debts / Bad debts written off . . 0.53 75.66 31.09 3.49 1.22 —
Total Expenditure (B) . . . . . . . . . . . . . . . . . . . . . . . . 2,389.21 2,561.91 2,320.82 3,091.16 2,594.68 2,200.19
PROFIT BEFORE PRIOR PERIOD ITEM,
EXCEPTIONAL ITEM, INTEREST,
DEPRECIATION AND TAX (A-B) . . . . . . . . . . . 489.94 578.52 392.95 (90.11) 263.74 316.65
Prior period item—Advertisement expenses . . . . . . . . — (28.50) — (24.94) — —
Prior period item—Trade discount expenses . . . . . . . . — (6.85) — — — —
Exceptional item—Provision for dimunition in
investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — (60.00) — — —
PROFIT BEFORE INTEREST,
DEPRECIATION AND TAX . . . . . . . . . . . . . . . . 489.94 543.17 332.95 (115.05) 263.74 316.65
Interest and finance charges . . . . . . . . . . . . . . . . . . . . . 2.07 1.44 0.79 20.07 21.69 8.93
Depreciation / amortisation . . . . . . . . . . . . . . . . . . . . . 42.45 51.71 45.19 52.12 25.25 15.54
TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44.52 53.15 45.98 72.19 46.94 24.47
PROFIT BEFORE TAX . . . . . . . . . . . . . . . . . . . . . . 445.42 490.02 286.97 (187.24) 216.80 292.18
Provision for tax
—Current tax (including short/excess provision for
current tax of earlier years) . . . . . . . . . . . . . . . . . . . 44.00 53.50 29.50 0.89 14.50 25.00
—Deferred tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.08 30.33 40.17 (33.23) 20.30 —
—Fringe benefit tax . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.00 5.70 1.80 — — —
—Wealth tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.27 0.42 0.11 0.13 0.14 —
TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52.35 89.95 71.58 (32.21) 34.94 25.00
NET PROFIT BEFORE ADJUSTMENTS . . . . . . . 393.07 400.07 215.39 (155.03) 181.86 267.18
ADJUSTMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . (18.13) 63.40 109.14 (72.67) (75.85) (7.57)
(refer note no. 2 of annexure IV)
NET PROFIT, AS RESTATED . . . . . . . . . . . . . . . . 374.94 463.47 324.53 (227.70) 106.01 259.61
Profit and loss amount at the beginning of the year/
period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99.11 39.08 (10.73) 216.97 286.75 202.81
Balance available for appropriation, as restated . . 474.05 502.55 313.80 (10.73) 392.76 462.42
APPROPRIATIONS
Interim dividend on equity shares . . . . . . . . . . . . . . . . 72.57 72.57 10.89 — — 14.00
Tax on interim dividend . . . . . . . . . . . . . . . . . . . . . . . . 10.18 10.18 1.42 — — 1.43
Proposed dividend on equity shares . . . . . . . . . . . . . . . — 18.14 10.89 — 14.00 —
Tax on proposed dividend . . . . . . . . . . . . . . . . . . . . . . — 2.55 1.52 — 1.79 —
Dividend on preference shares . . . . . . . . . . . . . . . . . . . — — — — — 0.22
Tax on dividend on preference shares . . . . . . . . . . . . . — — — — — 0.02
Transfer to general reserve . . . . . . . . . . . . . . . . . . . . . . — 300.00 250.00 — 160.00 160.00
TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82.75 403.44 274.72 — 175.79 175.67
BALANCE CARRIED FORWARD, AS
RESTATED . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 391.30 99.11 39.08 (10.73) 216.97 286.75

The above statement should be read with the notes on adjustments for restated financial statements and significant accounting policies as
appearing in Annexure IV and Annexure IVA respectively.
As per our report of even date
For S.R. Batliboi & Associates For Jyothy Laboratories Limited
Chartered Accountants
Per Sudhir Soni M.P. Ramachandran
Partner Chairman and Managing Director
Membership No: 41870
Place: Mumbai
Date: June 6, 2007
Place: Mumbai
Date: June 6, 2007

100

33 — — — Interest paid . . . .53 49. . (67. . .00 81. . . . 93. . . .26 (153. .68 847. (639.59 599. . .12 0.277. . . . . . . .67) (57. . . . . . . .59 599. . . . . . . 2007 101 . .33 752. . . . . .12 25. . . .24) 0. .19) (8. .16) — — Provision for doubtful advances . . . .77) (46. .04) Interest received . . . . . . . .29 524. . . . . .55 2. . .13) 385.15 5. . . .277. .66 13. . . . 61. . . . . . . .54) (56. .17 0. . . . . .42) 212. . . .63 49. . .95) (28.59 28. . .29) 74. .26 20.72) (1. . . .48) (0. . . . .00 3. . . . .01) (95. .86 0. .15 31. . CASH FLOWS PROVIDED BY/(USED IN) FINANCING ACTIVITIES: Borrowing / (Repayment) of loan funds . . . .98 Taxes paid . . . . .63 329. . . . .79) — (2. — 3. . . .59) Loans and advances . . . .04) (104. 4. . . . . . . . . .91 559. . . . . .08) (0. . . . . . . . . . . . . — — — (0. . .97) (35. . . . .94) (145. . . . . .21 394. . . . . . . . . .18) (19.33 752. . . .27) (240. . .54 (Profit) / Loss on discarded/sale of fixed assets. .64) (28. .78) (26. . . . . . . .10 1. . . . . . . . . . . . . . .P.29 689. .00 — Proceeds from sale of fixed assets . . . . (2. . . . .76 8. .44 (241. .00) 493. .61) Cash and cash equivalents at beginning of year/period . . . . . . — 13.25) — (0.27) 189. . . . .67) — Deferred sales tax loans . . . . . . . . . net . . . .97) (94.71 45. . . . . . . . .71) (83. . .38 43. . . . . . . — — — — — (1.25) (3. .25 37. .76 641. . . . .91 3.52) — — 0. . . . . . . . . loans and advances Inventories (including sales promotion items) . .82) (188.89) (28.10 1.64 292. . . . . . . . . . . . . .60) Provision for doubtful debts / Bad debts written off . . . . . . . 689. . . . .55 — — Operating profit before working capital changes . . . . . . .49 0.03) (36.59 599. (12. . .54 (35. . . . . . . .97) (14.18 Adjustments for: Depreciation . . . . . . . .08 (33. . . .00 — Dividend received . . . . . . . Ramachandran Partner Chairman and Managing Director Membership No: 41870 Place: Mumbai Date: June 6. . . . . . . . . . .59) (107. . . .75) (52. .38 72. . . . CASH FLOWS PROVIDED BY/(USED IN) INVESTING ACTIVITIES: Purchase of fixed assets (including capital work-in-progress and capital advances) . . . . . . . . . . June 30. . . . .24 Cash and cash equivalents at end of year/period . . . . (64. . . . .42) Dividend tax paid . .63 Components of cash and cash equivalents Cash in hand . . .01 1.09) 306. .82 B. . .79) (20. . .49 445. . . .89) (72. . June 30. . . . . 0. . . . . . . . . . .93 Sundry advances written off (net of provision) . . . .24 55. (61. . . . . . . . . .92 1. .98 Cash provided by / (used in) operations . . . . . 2. . . . . . . . . . . . .19 52. .15 Net cash used in investing activities .02 (0. (54.08) (121. . . . . .85) Increase / (Decrease) in current liabilities / provisions . .95 28. . . . . . . . . .52 — — 11. . . . . .49) 215.85) Debenture issue expenses .80) (221. . 1.10) (0. . . . . . . .10 0. 0. . . — — 5. . . . . .55 558. . . . . .00) — (28. . . . . . . .61) (114. .93) Dividend paid . . . . 157.33 258. .90) Net cash provided by / (used in) financing activities . 599. .09 0. . . .25) (37.23 891. . . . . . . . . .86 Balance with scheduled banks—Current account . . . . . . . . . . . .07 1.07) C. . . . 42. . . . . . . . . . . . . . — (4.45 1. . .79 20.33 258. . . . .77 (6. . .23 891. . . . . . . . . . . . . June 30. (0. . . . .25 15. . . 1. . . . . . . . . . . . . . . . . .09 1. . (588.17 93. . — (0. 2007 Place: Mumbai Date: June 6.36) Net increase/(decrease) in cash and cash equivalents (A+B+C) . . . .66) (13. . . . .94 2.07) (1. . .01) (89. .12) (0. .07) (14. .R. . . . . . . . . . . . Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M.42 397. . . .25 (0. . .69 8. .86 292. .45 51. 2. 418. — 4.67 3. . . .63 2. . .10) — — (0. . . . . .55 (46. . . as restated (Amount INR Million) Nine months Fifteen months ended Year ended Year ended ended Year ended Year ended March 31. . . (576. . . . . (309. . . . . . .06) Receipt of investment subsidy . .45) (10. . . . . . .44 0. .33 258.84 0.67) 93. . .63 As per our report of even date For S. . . . . . . . March 31.47 5. .06 — 1. . . .22 — Excess provision written back . . . . . . . . (90. . .16) Net cash provided by / (used in) operating activities .29 (314. . . . . .277.15) Interest expense . . . March 31. . . . . . . . . . . . .28 Proceeds from sale of investments . . .18 (198. . . .49 1. . . . . . .03) 12. . . . . . .90) (14. . .63) (49. . . . . .08 0.81 — 3. . . .84 (Increase) / Decrease in current assets. . . . .60 Dividend received . . . .14) (50.55 (270. . . . . . . . . (0. (105.41) (65. . .194. . . .33 752. . . . 2007 2006 2005 2004 2003 2002 A.15) (5. . .61) 909. . . . .85) (160. .41) (1. .25) (36. . . .09) (0.82) (0. . . . . .59 108.69 159. .78) 959. .62) (32.82) 158. . . . . 409. . . . .89 72.78 — Interest income .70 (70. . .16 391. .05) (3. . .83 1.36 0. . . .98 297. . . . . . . . . .48 —Deposit account . . . . . . . . . . .07) (Profit) / Loss on sale of investment . .09 3. . . .80) 136. CASH FLOWS PROVIDED BY/(USED IN) OPERATING ACTIVITIES: Net profit / (loss) before taxation . . . . . . . .72) (11. . 179.25) (47. . 0. . . . . . . . . . . . . . . . . . . . . . . . .74 Repayment of preference shares . .12 — Purchase of investments . . . . . . . . . . . . . . . . . .01 Provision for dimunition in the value of investments . . . . .44) (0. . . . . . 0. .47 592. .44 40.42) (29. . . . . . . . . . . .07 21. .30 511. .23 891.58 (260. . . . 89. . .54 0. . . . . .Annexure III: Summary Statement of Cash Flows.77 (39. . . .98 2. .97 0. . . . . . . .40) Trade receivables . — — (33. . . . . . . . .

(0. . For the purpose of this statement. . . . March 31. . . . . . . . . . . . . . . . . . . . . .05) 69. . . . — — 80. . . . .00 — — Bad debts recovered (See note no. 2001 has been appropriately adjusted to reflect the impact of deferred tax liability as on that date and accordingly the amount earlier adjusted to the opening general reserves for the year ended March 31. . . 3(b) below) . . . . . on account of first-time application of the standard has been reversed appropriately in the summary statement of profits and losses. 3(d) below) . . . AS-22 has been applied for the year ended March 31. . . . . . . .00) — — Trade discount for year 2004-05 (See note no.85 (6. . . .85) — — — Sub Total . . . . . and summary statement of assets and liabilities. . . (26.82) Unspent liabilities written back (See note no.85) (7. . . . . . . . . 2003. .54) — 7. 2004.54 (17.31 2.00) — 10. — (10. . .14 (72. For the purpose of this statement. Other adjustments a) Prior Period Items In the financial statements for the years ended June 30. . . . . . as restated. . . . . June 30.57) Current Tax Impact of Adjustments (See note no. . 102 . . . . . . . . . . . as restated. — 28. 3(f) below) . . . . . . certain items of expenses have been identified as prior period items. .25 Prior period items (See note no. . 2006 and June 30. . .ANNEXURE IV Notes on adjustments for Restated Financial Statements 1.00 — (55. . . . . . . . .40 117. . .89 0. . 6(A) below) . . . . . . . 3(d) and 3(e) below) . . . — — 55. .13) 63. . . .57) 3. Below mentioned is the summary of results of restatement made in the audited accounts for the respective years and its impact on the profits / losses of the Company.84 (72. . (27. . . . June 30. . . . the deferred tax asset/liability has been recomputed in the respective years of origination. . . . . . such prior period items have been appropriately adjusted in the respective years. PARTICULARS 2007 2006 2005 2004 2003 2002 ADJUSTMENTS Impact of changes in accounting policies and estimates Diminution in the value of investments (See note no. 3(a) below) Advertisement expenses . . .63) (7. . . . . . — — — — — (9. 2002. . . . June 30. . . . 8. . . .54) — — — Short/(Excess) provision for current tax of earlier years (See note no.00 (80.23 0. . . . .67) (75.78 — Total . .51 — — — — Other adjustments Sales returns pertaining to year 2003-04 (See note no. . the Accumulated Profit and Loss balance as at April 1. . . . .56) (24. . . . . . . . Accordingly. . . March 31. . . Deferred Tax The Company adopted Accounting Standard 22. . . .00) — Deferred tax (See note no. .67) (79. 2003. . . . . . . .00) (8. . . (18. .50 — (3. . . Further. — 6. — 17. . . . .94) — Trade discount expenses .51) 26. . .70) — 3. . . . . . .40 109. 3(g) below) .92 (6. . 3(c) below) . as if it was applicable since then. . . . 1 above) . . . . . . 2. (‘AS-22’) ‘Accounting for taxes on Income’ issued by the Institute of Chartered Accountants of India (‘ICAI’) for the first time in preparing the financial statements for the year ended March 31. (Amount INR Million) Nine months Year Year Fifteen months Year Year ended ended ended ended ended ended March 31. . .

as restated.b) Provision for doubtful debts Debts. for the period / year ended March 31. the Company was organized as a single segment—‘Home Care’. which has now been adjusted in the respective years. d) Short / (Excess) provision for tax of earlier years The profit and loss account of some years includes amounts paid/provided for or written back. g) Trade discounts During the year ended June 30. income tax (current tax and deferred tax) has been computed on adjustments made as detailed above and has been adjusted in the summary statement of profits and losses. 2006.00 million for returns pertaining to sales of this product made in the period ended June 30. on tax effect of expenses adjusted against the reserves. as restated. the Company has reorganized the homecare segment due to the change in the product profiles as well as the assessment of risk profile of the product. 2007. there was no impact on the profit of the Company. 2006. Pursuant to recent clarification dated September 5. For the purpose of this statement. adjustments have been made in the summary statements of profits and losses. June 30. 2006 and 2005. the homecare segment has now been bifurcated into two segments viz. 2003 and 2002. 2001. for the years ended June 30. For the purpose of this statement. 2004 and March 31. From year 2002-03. which has been netted off from sales. Upto the year ended March 31. Material regroupings a) Intangible Assets The provision relating to Intangible Assets as per Accounting Standard 26 on Intangible Assets (‘AS-26’) issued by the ICAI became mandatory for the Company from April 1. which were considered doubtful and written off in the year ended June 30. 2005. the said liability. Accordingly. has been appropriately adjusted in the financial statement for the period ended June 30. c) Unspent liabilities written back In the financial statements for the year ended June 30. ‘Detergents and Soaps’ and ‘Homecare’. 4.54 million determined based on sales made during the year ended June 30. on / after the year end. the said expense has been appropriately adjusted in the respective year in which sales were made. f) Sales returns During the year ended June 30. Accordingly. 2002. 2005 by the ICAI. the Company had accounted claims for trade discount of Rs 17. h) Segment reporting The provision relating to segment reporting as per ‘Accounting Standard 17’ on ‘Segment Reporting’ issued by the ICAI became mandatory for the Company from April 1. as restated. 2006. The effect of adjustments relating to financial years ending prior to March 31. incurred expenses on issue of debentures and write-off of these expenses is being adjusted against the Share Premium Account. the Company had initiated voluntary withdrawal of one of its product. wherever required. Consequently. 2001. Due to above change. However. 2005 and 2004. for the purpose of regrouping of restated profit and loss. 2004. 2004. Also. adjustments have been made to the summary statements of profits and losses. in respect of shortfall/excess income tax arising out of assessments. the amount of above proportionate write-off has now been adjusted net of income tax against the Share Premium Account. as per practice followed. adjustments have been made to the summary statement of profits and losses. 2006. appeals etc. for the year/period ended June 30. 2003. 2007 and June 30. liability created in earlier year was written back. 2006 and which have been subsequently recovered. 2002 has been adjusted against the Accumulated Profit and Loss balance as at April 1. the Standard has been applied retrospectively. the Company had issued credit notes aggregating Rs 80. e) Tax effect of debentures issue expenses adjusted directly against Share Premium Account The Company had during the year ended March 31. have been adjusted in the year when such debts were originally written off. as restated for the years/periods ended March 31. Accordingly. 2005. Accordingly. 2005. For the purpose of this statement. 2003. 103 .

Financial year ended June 30. In year 2004-05. 2003 was Rs 16. Financial year ended June 30. the Company recorded the accumulated impairment loss of Rs 25. excise duty and cess except provident fund. b) Trade discount Upto the year ended March 31.13 as an adjustment to the general reserves. 5. In accordance with the transitional provisions of AS-28. The market value as on March 31.87 million (net of deferred tax credit of Rs 13. the Company has capitalized the amount of additions made to software development under the Intangible Assets in the accounts for the year ended March 31.AS-26 has been applied for the year ended March 31. 2004 and March 31. B. 2003 and 2002. sales tax. 2006 The internal control system for sale of goods needs to be further strengthened to make it commensurate with the size of the Company and the nature of its business. No adjustment has been made in the financial statements for the year ended March 31. The statutory auditors have qualified their opinion on the financial statements for the year / period ended March 31. 6. 2006 CARO. In case of income tax. The management was of the opinion that the investments were strategic long term in nature and the diminution in the value of investments was temporary. However for the purpose of regrouping of restated profit and loss and restated assets and liabilities. service tax and professional tax. the Company has changed the disclosure and claims received in the nature of trade discount were netted off from sales. 2005. Subsequent to year end. During the year ended March 31. the Company has not generally been regular in deposit of the dues with the appropriate authorities.43 million for diminution in value of investment. For the purpose of this statement. the Company has initiated steps to strengthen the internal control system for sale of goods.00 million for the impairment losses representing the amount by which the carrying amount of the asset exceeds its recoverable amount. which do not require any corrective adjustment in the financial information are as follows: i. considering the trend of market value. there was no impact on the profit of the Company. AS 28 has not been applied for the period/years ended June 30. “Accounting for Investments” issued by the ICAI. 2003 The Company had made an investment of Rs 71. 2004 and March 31. Due to above change.18 million. 2004 and 2005. Accordingly. as if it was applicable since then. 104 . Such impairment losses were due to adverse market conditions for one of its Cash Generating Unit pertaining to the ‘Soaps and Detergents’ segment. The Company is regular in depositing with appropriate authorities undisputed statutory dues including wealth tax. employees’ state insurance. as the same was not applicable in those years. that became effective from April 1. 2002. Accordingly. Due to above change. Non-adjustments a) Impairment of assets The Company adopted Accounting Standard 28. 2003. 2004 on account of non-provision for diminution in value of investment. 2002. as issued and required by the ICAI for the first time in preparing the financial statements for the year ended June 30. the standard has been applied retrospectively. 2003. which was not in accordance with the Accounting standard 13. custom duty. the Company provided Rs 39. Accordingly. the management has provided Rs 60.36 million in the equity share capital of Sri Adhikari Brothers Limited (‘SAB’) in year 2000-01. Other Audit qualifications. the claims received from customers for trade discount was grouped as sales promotion expenses. 2004. 2003 and June 30. Auditor’s Qualifications: A. 2002 in the absence of available information. 2003 and June 30. as restated for the year / period ended March 31. (AS-28)—Impairment of Assets. The diminution in the value of investment had not been provided in the accompanying financial statements. there was no impact on profit of the Company. adjustments are made to the summary statement of profits and losses. where the Company has been generally regular.

. . .826.95 Short/(Excess) provision for current tax of earlier years (See note no. . . . . . . . .68 2.01 Sale of other traded products . . . . Note 5(b) Sales 2007 2006 2005 2004 2003 above) Sale of company’s branded products: a) Manufactured at own facility . . .57 1. . . . . custom duty. . .14) Profit and loss account as at April 1. . 2004 There was an inadequate internal control system for execution of certain sales promotion schemes. . .38 1.46 2. . . . . . 2001 (Amount INR Million) Profit and loss account as at April 1. .776. . . . . Details of Sales. . . . . . . excise duty and cess except provident fund and employees’ state insurance.067. .80 703. . . . . . . . where the Company has been generally regular. .654. .35 3. .85 (6. .91 1.12 105 . .35 3. . . the Company has not generally been regular though the delays in deposit have not been serious. . Financial year ended June 30. . . the Company has not generally been regular though the delays in deposit have not been serious.39 b) Procured under contract manufacturing arrangements . 202. According to the information and explanations given to us by the management this weakness has been rectified subsequent to the balance sheet date. . . 54. . . — 17. . Reconciliation of Profit and Loss balance as on April 1. — 24. . .12 Adjustments Sales returns pertaining to year 2003-04 (See note no.854.95 2. 212.98 1. . . 3(d) above) . . . . In case of income-tax. . . . . . .11 1. . . 7. 2001 (Restated) . . . . . . . . . . .133.54) — — — Prior period item: Trade discount expenses (See note no. . . . . .ii. . . service tax.95 2. .85) — — — Total .639. . .776.653. . . 2005 The internal control system for sale of goods needs to be further strengthened to make it commensurate with the size of the Company and the nature of its business. . . . .29 2. . . . . . . 2001 (Audited) . . .68 6. .019. . . . . . . . In case of sales–tax and profession tax. as restated (Amount INR Million) Year ended March 31. . — — 80. . . . . . . . . . . . provident fund and income tax. . . . (10. June 30. . wealth-tax. .495. . . where the Company has been generally regular. .48 2. . .785. . 1. . The Company is regular in depositing undisputed statutory dues with the appropriate authorities including excise duty. 3(g) above) . . iii. . . . . .043. .863. .44 1. . . . . .00) — — Trade discount for year 2004-05 (See note no.81 8.943. . . . — 6. . 3(f) above) . . . . .59 — 0. . 2. . 2004 CARO. . . . . . March 31.013.021.495. . Nine months Fifteen months 2002 ended Year ended Year ended ended Year ended (Refer March 31. .81 60.21 1. . . . 2.54 (17.826. . .104. . . . . . .46 2. . .46 1. June 30. 3(a) above) .00) — — Restated after adjustments . 2005 CARO. .39 55.72 As per audited financials . . . . . . . Financial year ended June 30. . June 30. . . . . . . . . . 1.802. . . .709. which was a major control weakness as at the balance sheet date. .61 (80. . .33 1.26 1. . The Company is regular in depositing with appropriate authorities undisputed statutory dues including sales- tax.810. . . .09 2. except in case of and employees’ state insurance.00 (80. .

.000 10. . . . .00 56.00 100. June 30.00 Number of shares (in Nos.) .97 286.068. . . . — — — — 1. .01 33.17 0. . . . . . SECURED LOANS 2007 2006 2005 2004 2003 2002 Cash credit from bank* . . As at As at As at As at As at As at March 31.00 100. . . June 30. .01 0. . . June 30.57 72.000 5. . June 30. . . .) . . . .66 1. . . . . . .43 67.08 General reserves . .00 — 0.068. 1. .57 72. . plant and machinery. . . March 31. .99 611. .99 Less: Debit balance in profit and loss account . . Face value of equity share is Rs 10 each and preference share is Rs 100 each 2. March 31. furniture and fixtures and other movable assets.000.30 99. .65 62. .12 1. June 30. . . .79 2.880 5.500. .00 100. . . . . . 12 % Redeemable cumulative preference shares of Rs 100 each redeemed on March 27. . subscribed and paid-up . June 30.85 Investment subsidy .65 153. March 31. . .01 0. . . — — — — 965. . .01 0. . . — — — 33. RESERVES AND SURPLUS 2007 2006 2005 2004 2003 2002 Share premium . . as restated (Amount INR Million) As at As at As at As at As at As at March 31.000 10.256.98 2. . 7. .055. . . . .9. 100.84 771. . 6. .297. . . .00 56.08 — 216. .31 1. . .000 Equity shares Issued. . March 31.027. 72.99 Balance in profit and loss account . June 30.600. .471. . . .763. .068. . . . $ 2 % Fully convertible debentures are secured by second charge by way of hypothecation of land. .57 72. .880 7. . . 10.068. .57 56. .66 1. .33 — — — 106 . .97 763. June 30. . . 0. 1. . . . June 30.59 6.97 997.31 Term loan from bank# .65 1. .01 — — 0.108. . . March 31.000. .85 1. . receivables. .00 100. . investments and other movable assets * The cash credit from bank is secured against fixed deposits and a first charge on inventory. .14 2. . . . . 72. . .880 7.256.57 56.73) — — 1. . SHARE CAPITAL 2007 2006 2005 2004 2003 2002 Share capital Equity shares Authorised capital .11 771. . . . . . 1. . . . .75 2. . . .00 Number of shares (in Nos. . . 2002 As at As at As at As at As at As at March 31. . .) . . .600.99 611.256. .297. . . .297.80 # Term loan from bank is secured against first charge on standing crops on land. .297.57 72. March 31.000 Preference share 12 % Redeemable cumulative preference shares .00 95. .17 0. . . book debts. . .113.00 Number of shares (in Nos. . Schedules to Summary Statement of Assets and Liabilities. .57 72. .54 1. . — — — (10.12 1. .43 67. . . . . .000. . . . . — — — — — 5. . .97 1.880 7.31 1. .01 0.000. . . .000 10. . . 391. . building and plant and machinery. March 31.08 2. . .000 9. .97 997. . .52 Capital redemption reserve . . . .00 Note: 1.33 — — — 1.000. June 30.49 2 % Fully convertible debentures $ . — — — — — 50. . . June 30. June 30. . .256. . .11 39. .57 72.08 1. . . . . . .000 Total .19 As at As at As at As at As at As at March 31. . . . . . . . UNSECURED LOANS 2007 2006 2005 2004 2003 2002 Deferred sales tax loan . . . . . . .000 10.59 3. . . . . . .12 120. March 31. .833. .97 1. . . .97 773. Both equity and preference shares are fully paid up 3. . .12 1. . . .

. . . .16 12.20 8. .37 1. 0. . .21 2.64 63. . . . . . . .45 57. 1. .47 4. . . .37 — — Provision for dimunition in Investments . — 0.26 Charge for the year . . . . — — — 0.23 12.87 58.16 Net Block as at as at March 31. . . .44 73. . . . 22.47 125. .19 — — Business Loss . .21 2.98 3. .49 Depreciation Accumulated Depreciation as at April 1. . . . . . .23 0. . 2002 .38 10. .92 — 4. . .69 2. . . .12 1. . . .45 7. . . .75 5. — — 0.47 4. .85 376.44 — Provision for doubtful advances .70 22. .11 11. . . . . . . .93 12. . . . . .71 Disposals during the year . . .33 107 . .69 123. . . .59 15. . . . .76 110. .75 0. .75 0. . . .13 — — — Provision for assets held for disposal . . Net 2007 2006 2005 2004 2003 2002 a) Deferred tax liability Depreciation . .75 0. . . . .77 Disposals during the year . . . .85 376. 2001 .05 5. .93 12. . 2002 .49 84. .93 FIXED ASSETS (Amount INR Million) Freehold Leasehold Plant and Dies and Furniture Office Particulars land land Building machinery moulds and fixture equipments Vehicle Total Gross Block as at April 1. . . . . 22.32 1. . . . . . — — — — — — — 0. . — 0. .56 7.37 256. . . . 22. . . 11. . . . DEFERRED TAX LIABILITY. . . — — 5. .74 42. .31 4. .40 0.82 10. . . .26 11.77 4.46 10. . .23 1.27 1. . .69 123.25 578. . . . . .92 47.34 27. . . .27 21. .47 182. . .50 Gratuity .70 — 0. . . 4.04 — 33. . . — — — 40. .77 75. . . . . . .58 10.13 13. . . .48 18.96 Gross Block as at March 31. . .49 84.43 6.72 0. . .57 121. . . .60 — 1. . . . . . . . .13 — — Others . . . .47 1. . .43 3.90 Freehold Leasehold Plant and Dies and Furniture Office Particulars land land Building machinery moulds and fixture equipments Vehicle Total Gross Block as at April 1. . . . . .67 210. 2001 .94 1.44 73. .69 2. . . . . . .27 0. — — — — — — — 0. . . .78 10. .64 278. . . . . .64 1. . .45 7.11 44. . .77 4. .44 0. . . .48 11. — — 8. . .47 7. .84 108. . . . . 0. . . . . . .74 42. June 30.58 2. . . .02 Accumulated Depreciation as at March 31. . . . .68 Additions during the year . .11 44. . . . . . .09 5.80 90. 28. . . 2002 . . .23 Gross Block as at March 31. .20 Additions during the year . . . .02 0. as restated—(Continued) (Amount INR Million) As at As at As at As at As at As at March 31. . . 2003 . . . . . . . .37 27.83 23. .05 2. . . . . . . . .40 Accumulated Depreciation as at March 31. . .42 5. .60 63. . . . . . 2002 . .86 21.91 1. .13 13. .10 1. . . . . 6. . .75 8. . . .22 11. .46 10. . . .32 0. . .04 27. .51 255.59 15. .07 46.42 15.48 11.38 13. 51. . .60 7.42 644.79 9.20 5. March 31. .38 — — Provision for leave encashment . . . .76 10. — — — 1.78 12. .75 5.93 9. . . . March 31.77 — 56. . — — — — — — — 0. . .23 6.06 6. . . . . . .98 17.98 11. . . . .47 168.81 23.26 — — — Provision for impairment losses . . . .78 Adjustments for disposals during the year . .53 231.96 1.08 — — 32. 2003 . 51.54 Adjustments for disposals during the year . — — — — — — — 1. — — 13. . .40 18. . . . . . .78 Charge for the year . .17 95.79 22. .81 23. . . . . . .64 63. — — 13. .54 2. .30 4. .80 b) Deferred tax assets Technical royalty . . .46 10. . .27 7.11 333. 13. . . . . .47 4.Schedules to Summary Statement of Assets and Liabilities. . . 2003 . 15.75 4. .78 Net Block as at March 31.70 4.16 7.37 Provision for doubtful debts . 2002 . 90.68 Depreciation Accumulated Depreciation as at April 1. . .17 66. .47 182. . June 30. .61 2.51 10. . .53 269. .38 10. . . . .72 0. June 30. . . . . . .

. .90 Impairment loss as on July 30. . .35 39. .64 322.37 108 . . .68 8. .17 66. .38 4. .29 1.10 3. . — 1. — — — 0. .56 5.05 — 2. . . . . — — — 0.49 59.67 28.56 5.45 7. . .56 22. . .18 83.30 13. .94 Accumulated Depreciation as at June 30. . . .06 7.34 21. 51.39 288. . . . .59 399.86 21. . . . . .51 18. .32 3.09 1. . .16 Charge for the period .45 7.32 Adjustments for disposals during the period .79 31. . 2005 . .35 27. . . . . .07 13.Schedules to Summary Statement of Assets and Liabilities. .42 24.07 13. 52.79 22. . .66 193. 2004 . .33 Depreciation Accumulated Depreciation as at July 1. .49 Additions during the period . . . .90 1.63 112. 2005 .42 23.31 19. .30 4. . .23 Disposals during the period .49 9.99 18.45 7. .56 8. .42 644.53 Gross Block as at June 30th. — 0. as restated—(Continued) FIXED ASSETS (Amount INR Million) Freehold Leasehold Plant and Dies and Furniture Office Particulars land land Building machinery moulds and fixture equipments Vehicle Total Gross Block as at April 1. .74 2. . . . . . 2004 .35 27. . . . . . — — — 0.19 Depreciation Accumulated Depreciation as at April 1. .94 223.54 4. . .65 Freehold Leasehold Plant and Dies and Furniture Office Particulars land land Building machinery moulds and fixture equipments Vehicle Total Gross Block as at July 1.96 Gross Block as at June 30. . . .64 278. . — 0. . . . 2005 . .19 Additions during the year . . — 1. . .07 11.98 17.10 1. — 0.53 8. . 51. .94 34. .67 28.52 1. . . . 2004 . . . . 2003 .06 4.50 — 0.99 18.61 — 77. .10 — — 0. . .12 11. .25 6. . .76 2.47 — — — 4. 51.47 266. . .63 112. . . . . . . . . .27 21. . . .69 18. . . . — 0. .53 231.25 288.35 942.00 Adjustments for disposals during the year .39 33.04 — — — 1. . . . . — 0. .10 340. — — 43.54 Net Block as at as at June 30.10 108. . .51 4.91 5. 52. .53 42.70 22. . . .84 42.75 2. .98 11. .12 740. . — 0.07 0. . 2004 .76 100.47 1.31 4. .29 1.03 14.28 — — 0.36 48.76 2. .39 33. . 51.47 266.54 Charge for the year . .99 31. .53 42. . .06 6. 2004 .97 5.42 23. . . .26 0.45 7. .12 740.78 12. . .16 0. . .04 0. 0.05 4. .69 748. . . . . . . . . .96 Net Block as at June 30.49 627.43 4.67 1.31 10.67 21.57 372.64 322. . . 2005 . . . . . . . .26 22.68 8. .79 21. . . . .10 Disposals during the year . . 2003 . . .99 19.25 3. .75 23.97 205. . .48 Accumulated Depreciation as at June 30.

.47 132. 2006 . . .03 14. . .26 5.23 5. . .50 — 0.76 1. . . . .58 59.16 10. . — — — — — — — — — Impairment as at June 30. . . — — — 3. .09 1.34 15. .18 418.26 0.52 1.62 4. . . .23 12. .45 33. 2007 . . .57 372. 54.60 103. — 1.83 11.29 53. . — — — 0. . .10 Accumulated Depreciation as at June 30. . . . 2006 . . .84 62. . .46 44. . . — 0. . .17 — 0.06 0. — — — 7. .16 85.08 Additions during the period . .23 — 62. — — — — — — — — — Impairment as at March 31. . . 2.19 201. .26 Gross Block as at June 30. .93 26. .04 28.03 14. . 54.99 31. . .59 334. 2006 . . .17 25. .42 6. . 2006 . . . . . . .02 Impairment Impairment as at July 1.03 3. 2006 .67 5. . .18 418.52 1. 2005 . . . 54.26 19. . .45 33. . — 1.60 Accumulated Depreciation as at March 31. 2005 . .18 27. . .34 15. . . .73 10.64 41. .35 39. . .65 18. .35 942.35 39.58 59.42 24. .35 39.12 36.05 3.85 3.64 20.01 Disposals during the year . . .21 1. . . .12 14. — 0.42 2. .06 7. . . 2005 .09 1.68 3. .03 14. — 0.31 3. . .97 Charge for the year .34 21. — 0. . .95 2. .32 24.10 50. . . .27 8. 2007 .88 515. . .04 6. 84. 2007 . . .31 4.20 5. . 2006 .21 Gross Block as at March 31. . . .78 Depreciation Accumulated Depreciation as at July 1. .70 23. — 0.11 431. 30. . .26 0.218. . 2006 .79 31. — 0.06 Freehold land (Refer Leasehold Building Plant and Dies and Furniture Office Particulars Note 1) land (Refer Note 2) machinery moulds and fixture equipments Vehicle Total Gross Block as at July 1. . . .064. 52. .25 Adjustments for disposals during the period . . . .34 21.17 — 0. . . as restated—(Continued) FIXED ASSETS (Amount INR Million) Freehold land (Refer Leasehold Plant and Dies and Furniture Office Particulars Note 1) land Building machinery moulds and fixture equipments Vehicle Total Gross Block as at July 1. .79 235. .59 462. .35 48.33 1. . . 2007 .86 7. — 1.10 0. . . . . . . . . . . . . .93 26.59 399.50 — 0.29 7. .064.35 39. . . .00 Charge for the period . . .02 Charge for the period .44 20. . . . .52 1.03 0.02 38.10 1. . .23 — 0. . . .91 Disposals during the period . . .Schedules to Summary Statement of Assets and Liabilities. . . 84. . .78 12. . .74 69. . . . . . .50 — 0.49 9. . . . . . . . .41 1. . . .10 3.22 4. .12 36. . .33 Additions during the year . . . . . . .00 Net Block as at June 30. .00 Charge for the year . — — — 2. . . . .49 9.19 201.66 40. . .00 Net Block as at March 31.34 21. . . . . .04 28. .61 48.71 4.32 23. . .50 — 0.15 Adjustments for disposals during the year . . .00 26. . . . . . . .27 944.29 7. .93 27.49 19.31 154. . .54 3.52 1. . .84 1. . . . .54 2.56 22.67 Impairment Impairment as at July 1.03 14. . . . . .26 23. . . — 1. .94 — 0.26 5.16 85.64 24.11 109 . .34 21. .98 388.55 824. .06 18.08 Depreciation Accumulated Depreciation as at July 1.59 462. . .26 0.55 166.32 24.00 26. .08 0. . .26 0.68 311.53 459.29 5. .76 20. . . .88 2. . . .

31 0. .31 Sab Nife Power Ltd .03 9. . .86 0. . . . . . . .50 against recovery of dues and is held for disposal. .18 Infosys Technologies Ltd . . . . . . . . .86 0. . . . .14 1. . . . . . . . . . . . — — 1. . .18 1. . . . . . .86 Punjab Tractor . . . March 31. .96 34.90 — Investment in Balaji Telebrands Limited—a Joint venture company . . . . . .09 1. . . . (63. . . . . . .00 against recovery of dues and is held for disposal. . . . — — 2.31 17.03 72. . . .26 2.14 Tata Motors Ltd .18 1. . . . . . . . . June 30. . . . — — 0. . . . . . . . . . .03 26. .03 17. . . . . . . .32 0. . . . . . . . . 10. . . . — — — — — 19.71 0. .36 71.90 7. . . .14 1. .00) (63. . . . . . . 1.51 Investment in Mutual Fund Unit Trust of India—GSEC . . . . . . . .06 26. . . . . . . .63 NAV of investment in mutual fund . . .13 0.13 0. 0. .26 9. . . . .25 110 . . .71 0. . . . . .00) — Total . .90 7.06 19. . .90 7.03 0.03 18. . . . . . . . .54 1. . . .30 Market value of quoted shares . . . . . . . . . . — — 0. . .36 71. . INVESTMENTS (Long term. . . . . . . . . . .32 Wipro Ltd . . .28 81. . . . .90 7. .31 0. . . . . . . . . . . .14 1. 0. . . . . .67 25. . . . . . . . . . . . . .85 70. . . . .71 0. . June 30. . . . .28 81. . .18 1.28 101. . . . .51 0.25 — — — — — Non Trade Investments (Quoted) Investment in Shares Contech Soft Limited . . . . . . . . . . . . . . .27 Less: Provision for dimunition in the value of investments . . . .06 30. . . . . . .18 1. . .09 1. . . . . — — 0.13 0. .03 81. .03 0. . . . . . . .28 101. . . . . .51 0. . as restated—(Continued) Note 1) Includes land acquired from customer at agreed value of Rs 1. . .00 Sub Total . . . . 72. . . . . . . . . . . . . . . .54 1. .86 0. . . . . . . — — 0. . .26 2. .25) (55. . . .25) (58. . .85 71.36 71. . . . . .46 9. March 31. . . . . — — 1. . . . . . . 9. . . . . .73 13. . . . .09 Satyam Computers Ltd . . . . .54 Shri Adhikari Brothers Ltd . (Also refer note under sundry debtors schedule) 2) Includes flats acquired from customer at agreed value of Rs 19. . .25 Mphasis-BFL SW Ltd . . . . . . . . . . . — — — — — 20. . 7. . . . . . . . .09 1. . . (Amount INR Million) As at As at As at As at As at As at March 31. . . . . . . . . .36 MTNL . . — — 1. — — 0. . . .54 1. June 30. .21 101. .31 0. . .71 Zee Telefilm Ltd . . . . . . .32 0. . . . . .26 2. . . . . . . . 70.03 23. . . . . .00) (63. .27 National Saving Certificates .Schedules to Summary Statement of Fixed Assets. . .51 0. . . . . . . . . .32 0. . . . at cost) 2007 2006 2005 2004 2003 2002 Trade Investments (Unquoted) Investment in Sri Sai Home Care Products Private Limited—a wholly owned subsidiary . . . . . . . . . . . . . . . . . . . . .18 1. . .

. . . . . . . . INVENTORIES 2007 2006 2005 2004 2003 2002 Raw and packing materials (including goods in-transit) . . . . . . . 13. .26 13. .32 — 0. . . . . . . . . 9.32 — 0. .78 4.84 16.41 334. .83 132. . . . 115. . .49 Note Sundry debtors include receivables of Rs 15. as restated—(Continued) (Amount INR Million) As at As at As at As at As at As at March 31. .51 118.Schedules to Summary Statement of Assets and Liabilities. .47 10. . . March 31. . SUNDRY DEBTORS (refer note) (refer note) 2005 2004 2003 2002 Secured. .25 82. . . . . .49 1. . . — — 30. . June 30.72 6. . . . .89 Stores and spare parts . .57 3. . . June 30. .53 567. . . 614. . . . . . . . .48 Work in progress . . . .12 113. . . .36 3. .31) (0. .22 8. . .26 is considered as secured against the market value of land acquired from the customer.10 260. .78 b) Other debts Considered good .58) (3. . . . . . .91 236.52 253. . . June 30. . . . . March 31. Of the total outstanding. .52 253. (Refer note under fixed assets schedule) 111 .44 28. June 30. As at As at As at As at 2007 2006 June 30.01 279. considered good Outstanding for more than six months . 1. Rs 13.34 7. . . . . . .27 80. . .88 87. .10 570.02 180.03 6. . (1.16 2.71 629.42 84.22 — Less: Provision for doubtful debts .65 290.10 4. . .58 3. .57 3. . . . . .44 21.22) — 2.00 6. . March 31. .00 — — — Less: Provision for doubtful debts . . . March 31. . . .01 279.78 92.53 567.99 334. . .36 3. . . .12 186. .71 320.78) (4. .10 260. 2.10 261.57 As at As at March 31. . . . .19 43. — — (30. . . .26 — — — — Unsecured a) Outstanding for more than six months Considered good .55 Finished goods (including goods in-transit) . .39 193.00) — — — 614.07 from a customer with whom transactions has been discontinued during the year 2005-06. 19. . . .61 99.78 Considered doubtful . . 146. .28 8.71 Considered doubtful . .88 257. . . . Management has filed litigation against the party. . . June 30. .41 334. . . . . .31 0.44 28. . . . . . . . . .49) (1. . . . .

.21 137. . — — 0. . March 31. . . . . . . .88 53. . . . . . . .45 22. . . . .19 18. . .25 As at As at As at As at As at As at March 31. . June 30.36 81. . . . . . . . . .05 10. CURRENT LIABILITIES 2007 2006 2005 2004 2003 2002 Sundry creditors . . . .24 20.72 As at As at As at As at As at As at March 31.16 2. . .03 179. . . . . . 5. . . . . . . . . . .67 116. 57.55 — 208. .91 25. . . . .01 1. June 30. . . . . . . . . . . 13. . . .79 — Provision for gratuity . . March 31. . .72 237. .29 689.53 — 1. . . . . . . . . June 30. . . . .26 3. . . . . 0.00 — Provision for wealth tax .81 — — Less: Provision for doubtful advances/ loans . . . . . . . . . . .20 97. . June 30. . . . .09 1. . . 9. . . .27 201. 0. . — 15.73 6.63 7. . . . . .40 20. . 34.77 Staff loans .87 17. . . . . . .28 27. . . . . . . . . . . . .62 15. . . . .72 6. . . 21. . . . . . . . . . .80 — — — 49. . .29 3. . . . .74 1. . . . . . .04 1. . . . .25 Unsecured and considered doubtful Advance to suppliers .31 4.97 7. . . . .03 5.51 391. .98 2. .78 47.33 752. .76 0. . . 6. . . . .59 599.44 194.34 Quantity discount receivable .06 19. . . . . . .62 Provision for fringe benefit tax . . . .23 36.54 1. . . .95 4. . .68 847. . . . . . 268.90 68. .23 84. . .33 31. .52 5. . June 30. . . as restated—(Continued) (Amount INR Million) As at As at As at As at As at As at March 31. 5. .33 11.04 240. . . .194. . . . . . .38 72. . March 31. . . . .68 69. .33 258. . . considered good Advances to wholly owned subsidiary .84 135. . . 62. . . . . . . . . .50 11. . . . . . . . . — 2. . . June 30. . . .14 29. . . . .05 12.23 891. . . (5. . . . . .12 43. . .53 35. . .46) — — 208. . . . .82 5. March 31. . . . .50 1. . CASH AND BANK BALANCES 2007 2006 2005 2004 2003 2002 Cash in hand . 30.75 1. .79 Other current liabilities . . . .38 43.76 641. .73 2.00 81.27 9. . . . 1. . . . . . . . . . . March 31. .86 Balance with scheduled banks—Current account . . . . . . . . . . .51) (4.88 — 14. . . . .68 3. 104. .59 108. . . . . LOANS AND ADVANCES 2007 2006 2005 2004 2003 2002 Unsecured. . .18 8. . .65 — — Loans to employees . . . . . .11 0. .14 10. .94 229. . . . . . . . . . . . . . . . . . .81 281. .51 4.10 1. . . . . . . . .69 159. June 30. . June 30.72 237. . .39 31.55 24.75 71. .28 4. . March 31. . . . June 30. . . . . . . . . . . .93 4. . . . . . . . . . . . . . . . . . 599.55 4. . .42 Balance with excise authorities . . . .63 As at As at As at As at As at As at March 31. .18 270. . June 30. . .14) (28. . . .38 Advances recoverable in cash or in kind . . . . . . . . . .88 Deposits .33 27. .33) (32. . . . March 31. . . . . .03 179. .29 524. . . . . .04 240. . 89. .02 Provision for leave encashment . .55 250. . .81 0. .13 5. . . .99 144.16 Advance tax (net of provisions) . . . .54 15. . June 30. . . . . .64 110.60 6. . . . .87 238. . . . .48 — 3. . . . . . .77 Advances from customers . . . . . . . .69 47. PROVISIONS 2007 2006 2005 2004 2003 2002 Proposed dividend . . . . . . . . . .52 52. . . .82 10. . .17 0.65 Security deposits .277. . .64 34.17 93.06 6. . .39 158. .47 40.76 6. . . . . 3.21 137. . .92 107.47 5.13 0. . .21 12. . .43 0. .12 — — — 9. . . . . . . . . . 15. . . — 18. . . . . .00 — Dividend tax on proposed dividend . . . . . . .43 0. . . .64 112 . . . . . . March 31. . . . .14 — Provision for income tax (net of advance tax) . .48 —Deposit account . June 30. . . . . .30 Advance to suppliers .92 1.87 238. .75 184. . . 14. . .36 48. . . .98 11. . . .98 4. . . .Schedules to Summary Statement of Assets and Liabilities. . . .

. March 31. 1. . . . June 30. . . Schedules to Summary Statement of Profits and Losses. . . . — 4.86 478.42 84. . March 31.95 28. .37 1. .25) (82. .12 0.458. . (115.78 936. . . .035. . . . . .82 132. .55 102.91 1.650.25 37.16 — — Sales tax incentives . — 3. . . . .35 1.15 5.10 1. .77 13.24 — 0.019. . 0. 1.25 82.65 1. . . .06 6. (97. . . .72 Nine months Fifteen months ended Year ended Year ended ended Year ended Year ended March 31. (B) 23.48 1. . . .92 626. . . .68 25.29 559. 99. .60 Export incentives . . .08 542. . . . 73. . .04 947. . . . . . . . .10 0. .59 582. . . .25 3. 947.48) (a) 500.33 625.70 40. . . (c) 53. .63 49. — 7. .73 825.87 474. 8. .89 891. 4. .43 6. as restated (Amount INR Million) Nine months Fifteen months ended Year ended Year ended ended Year ended Year ended March 31.52 — — — — Excess provision written back . . .368. .15 Interest on fixed deposit .07 1.465. June 30.36 979. . . March 31. . . . .82) (132. . .44) (8. . . . 26.93 — — — — — (A)[a+b+c] 1.43 0.77 894. . . .35 Miscellaneous income .86 672. . . . . .88 87.61) (99. .08 Provision for free products under sales promotion scheme . . . June 30. . . . .61 1. . 517.79 Add: Cost of purchases (including freight.07 1.33 616. .87 562. . March 31. . . . . .31 — — — Bad debts recovered .50 2. . . . . .05 473. . . .90 1. . .49 481. .89 72. — — 0. . . . . .51 — — — — — Credit balances written back .58 — Processing income . .47 934. . . . net of freight subsidy) . . .12 Less: Closing stock . . .94) (73. .63 3. .93 1. . OTHER INCOME 2007 2006 2005 2004 2003 2002 Dividend received .04 476.96 21.42) (84. . . . .13 24.452. . .38 947. June 30. .34 0.501. .42 905. . — — — 0. . . .58 42.90 1.34 1. .48 82. . . .99 630.88) (87. . . . . .42 1.74 760. . .99 113 . . . .394. . . . . . . . .63) (b) 923. . . . . . .20 1. . .27 Total (A+B) .41 715. . .72 Excise Duty . .42 840.43 3.25 8. .28 26. . . . .80 1.66 13.64 Cost of trading goods Opening stock . . .08 0. 61.86 849. .80 121.13) (24. .059. . . . . . .32 1.53 1. . . .14 60. . .675. .29 57. .39 479. .82 0. . . . .10. .72 526. .71 Less: Closing stock . .09 0.70) (40.83 13. June 30.48 0. . MATERIALS CONSUMED 2007 2006 2005 2004 2003 2002 Raw and packing materials consumed Opening stock . .37 Add: Cost of purchases . . .478.99 474.43 — — — Profit on sale of investments . .07 Lease rent income .20 24.10 31. .021. .61 1.55 2. — 10. .44 8. . . . . . . June 30. . .58) (42. .40 — — — Profit on sale of fixed assets (net) . .431.

. (9. . .03 19.15) Nine months Fifteen months ended Year ended Year ended ended Year ended Year ended March 31.06 25. . .10 13. . March 31. . . . . . .69 38. .28 8. . . . . . . .51 46. .08 Staff welfare expenses . . . .43 — 5.50 13. .92 12. .44 11.55 57. .08 52.72 13. . . .47 10.20 5.82 15.37 6. .24 114 . 39.94 Work in progress . . . 3. . . wages and bonus . . . . .43 0. . . . .33 296. . .41 26.76 (A) (10. . . .21 10. .17 39. . .02 Directors’ remuneration . . . .84 9. . . GOODS/WORK IN PROGRESS 2007 2006 2005 2004 2003 2002 (Increase)/ decrease in inventories Closing stock Finished goods . .43 0.54) (0. .37 17. .91 5. . .09 Excise duty on opening stock . . .33 Contribution to provident and other funds . . . 17. .55 62. .05 (41.03 19. . . .27 Work in progress . . . . . . .47 10. . . June 30. . . .16 22.Schedules to Summary Statement of Profits and Losses. . . . .06 19. .00 13. .28 8. .13 4. .10 4. June 30. .97 46. March 31.26 Field staff incentives .00 249. . . . .03) (5.85 179.00 6.10 4.55 1. June 30. . . 17. . . . . .68 Commission to directors . . .91 5. . . . . .57 336. .09 182.06 19.08 52.18 3. . . .97 8. . .55) (10.02) (1. . . . . . EMPLOYEE COSTS 2007 2006 2005 2004 2003 2002 Salaries. . .44 176. . . .45 1.09 — (B) 0. as restated—(Continued) (Amount INR Million) Nine months Fifteen months ended Year ended Year ended ended Year ended Year ended (INCREASE)/DECREASE IN FINISHED March 31. March 31. 2. . 7. . . .31 16.69 38. .18 27. 9. .00 6. . June 30.34 7. . . .06) (Increase)/ decrease in excise duty Excise duty on closing stock . March 31. .64 117. . . .97 156.55 62.82 Opening stock Finished goods .42 20. . .30 10. . .54 (4. .39 — 6. . 15. .20 18.62) 1. . 210.92 1. . . .81 0. 48. . . . . 20.57 7. . . 5. . . . . .03 6.27 7. .24 5. .09) Total (A+B) . .42) 15. . . . . . .39 16.26 271. . . .03 6.97 46.47 33. .45 1.79 30. June 30. .06 25. .38 99.82 9. . . . . . .00 13.34) (0. .05) (6. . . . . June 30.51 (37.54 Gratuity . .82 46.03 14. . . . .21) (10. 10.39 11. . .22 220.

. . .27 — 9. . . .84 43.58 8. .69 8. . . .07 1. . .59 28. 4.25 — — 0. . . . . . .24 0. . .93 115 . . . .38 Field staff expenses and awards . 5. .09 0.56 —Others . .67) — Miscellaneous expenses . .85 1.37 10. . . . . . . . .17 11. . . .43 50. . . . .78 83.52 11.Schedules to Summary Statement of Profits and Losses.51 0. . . . . .89 10. . . .29 0. March 31. . . . . March 31.41 11. . . . . . . . . March 31. . . . .20 0.70 1. . 0. — — — — 0. . . . . . . . .46 65.82 13. . . .13 — — — Vehicle maintenance . . .34 0.18 7.20 7. . .98 1.18 Directors’ sitting fees .00 — — Provision for doubtful advances .22 9.59 14.23 1. 13. . OPERATING AND OTHER EXPENSES 2007 2006 2005 2004 2003 2002 Conversion charges .89 24. . . . .34 8.69 1. . . . . . . .16 3. .43 5. June 30. 2. . .89 3. . . . . . .71 50. .47 12. . . .07 21.88 9. . . . .23 Interest on debentures .07 1. . .41 3. . . . . . . . . . . 1.36 51. . .16 Rent . .85 320.85 15. .86 Brokerage on sales . . . . .72 Research and development .06 49. .04 2. .90 Traveling and conveyance . .16 65. . . . .20 17. . . .26 11. .79 1. . .32 7. net . .65 9. . . . .00 3. . as restated—(Continued) (Amount INR Million) Nine months Fifteen months ended Year ended Year ended ended Year ended Year ended March 31.56 41. . . . 52. . . .77 27. .77 5. . . . .76 Loss on discarded/sale of fixed assets. . .67 3.89 16.39 49. .15 0. . . . .36 2. . . . . — 4.91 11. . . 1. . . . . June 30. . . . June 30.89 — 2. . — — — (0. . . June 30. 6. . .39 Rates and taxes . . . .41 35.34 Loss on sale of investments . .63 14. . .50 0. INTEREST AND FINANCE CHARGES 2007 2006 2005 2004 2003 2002 Interest on loans from banks .86 0.97 0.10 7. . . .26 30. . . . . . . .50 46. . June 30. 35. .77 0. . . . . .34 7. .11 0. . . . .57 Power and fuel expenses . . .24 — — Sundry advances written off .01 Debenture / Share issue expenses . .66 10.30 1. . .80 302. . . . .07 19. . . . .72 Legal and professional fees .20 404. .37 1.81 — 3. . .04 16. . .53 10. .02 — Provision for assets held for disposal . . .17 3.40 34. 4.21 6. net . . . . 1. .67 — Less: Amount adjusted against share premium account . . . .69 2.64 3. . .33 Insurance . .34 31. . . — — — 9. .78 Printing and stationery . .01 9. . — — — 3. .35 25. .22 Nine months Fifteen months ended Year ended Year ended ended Year ended Year ended March 31.00 Communication costs .47 1. . . 3. . . — — — 0.55 5. . .48 0. . . . . .70 Bank charges and commission .97) (35. . .44 0. .76 8. . . .86 46. . . . . 16.36 0.27 18. . . . . .86 417.28 326. .47 1.55 — — Provision for dimunition in value of investments . March 31. . 28. . 0. .58 6. .17 0.30 25.27 2. . . . . . . . . .13 — Carriage outwards (net of freight subsidy) . . . . .28 0. . .19 3. . . . . .82 9.61 1.50 44.28 53. . . . . . .64 1. 51.78 — Exchange loss. 2. . .97 35. . — — — 1.03 12. . 3. June 30.57 15. . .96 Donation .81 0. . . . . . . . . . 27. . . .98 9. .44 47. .74 2. . 0. . .95 8.16 39. . . . . .18 — —Plant and machinery . .79 20. . . — 0.49 50. . 15. . 6. .32 Repairs and maintenance —Building .27 270. . . . 42. . . . . . . . . .43 12. . .02 37. .19 10.31 24.

00 — — 26. . . .99 — (b) Disputed sales tax demands—matters under appeal . . . . .49 6. . .69 6. . 3. . . . .R. . . 2007 Secretary Place: Mumbai Date: June 6. . . . . . .43 1. . March 31.67 — — — (ii) Tax matters (a) Disputed liability in respect of income-tax demands—matters under appeal . .P. .51 — 7. . 2. . as restated—(Continued) (Amount INR Million) As at As at As at As at As at As at March 31.65 2. . . .80 0. .49 As per our report of even date For S.69 9.00 2. .78 21. . . . . . . . June 30.49 (c) Disputed excise duty and service tax demand—matter under appeal . .23 38. . . June 30. . . .00 12. . . . . . . . . 12. .17 4. . . . . . . .89 13. June 30. 2007 116 .66 2. . . . March 31. . 1. . . . . . .89 47. . . . Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M.65 1. . .95 2. .21 — 54. .Schedules to Summary Statement of Profits and Losses. . . CONTINGENT LIABILITIES 2007 2006 2005 2004 2003 2002 Contingent liabilities not provided for in respect of: (i) Amount outstanding in respect of guarantees given by the Company to banks . .20 4. Ramachandran Partner Chairman and Managing Director Membership No: 41870 Place: Mumbai Date: June 6. 34.85 — — — (iii) Claims against the Company not acknowledged as debt . .

. . 6 Office equipments . . . actual results could differ from these estimates. . . ii. . . . b) Use of estimates The preparation of financial statements. . . . . Cost of shares of Co-operative society has been added to the cost of office building. . . . . An impairment loss is recognized wherever the carrying amount of an asset exceed its recoverable amount. . . . f) Operating Leases Lease payments on operating leases are recognized as expense on a straight-line basis. . . . . 8-10 Trademarks . d) Depreciation Depreciation is provided using the Straight Line Method as per the useful lives of the assets estimated by the management. . . . . . . . . . . . The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. . . 117 . . . 20 Vehicles . . . . . The recoverable amount is the greater of the assets net selling price and value in use. . . . . . The estimated useful life of the assets is as follows: Category Estimated useful life (in years) Buildings . 30-60 Plant and machinery . . . c) Fixed assets Fixed assets are stated at cost. . . Borrowing costs relating to acquisition of fixed assets which takes substantial period of time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to be put to use. . . . depreciation is provided on the revised carrying amount of the assets over its remaining useful life. . . in conformity with generally accepted accounting principles. 9 Leasehold land is amortised over the period of the lease on a straight-line basis. . . . .ANNEXURE IVA: Significant Accounting Policies for Restated Financial Statements a) Basis of preparation The financial statements of the Company are prepared under the historical cost convention on accrual basis of accounting. After impairment. . . . . over the lease term. . . . . . . . . . . . A previously recognized impairment loss is increased or reversed depending on changes in circumstances. . . . . . 3-21 Electrical installations . . . Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use. . . . . . . . . . However the carrying value after reversal is not increased beyond the carrying value that would have prevailed by charging usual depreciation if there was no impairment. . . . . . . . . . e) Impairment i. . 1-3 Computers . . . 20 Furniture and fixtures . . . . . and in accordance with the mandatory accounting standards issued by the Institute of Chartered Accountants of India and referred to in Section 211(3C) of the Act and generally accepted accounting principles in India. . . . . . . . . . . In assessing value in use. . . . . . . . requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the results of operations during the year end. . . Although these estimates are based upon management’s best knowledge of current events and actions. . . . . . . the estimated future cash flows are discounted to their present value at the weighted average cost of capital. . . . less accumulated depreciation and impairment losses if any. iii. . or at the rates prescribed under schedule XIV of the Companies Act. . . . . . . . . . . 1956 whichever is higher. . . . . . 12 Dies and moulds . . .

g) Government grants and subsidies Grants and subsidies from the government are recognized when there is reasonable assurance that the grant/ subsidy will be received and all attaching conditions will be complied with. are recognised as income or as expenses in the year in which they arise. When the grant or subsidy relates to an expense item. or reported in previous financial statements. j) Revenue recognition Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. (iii) Exchange Differences Exchange differences arising on the settlement of monetary items or on reporting company’s monetary items at rates different from those at which they were initially recorded during the year. Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction. k) Miscellaneous Expenditure Miscellaneous expenditure comprises preliminary expenses for software development expenses for the in-house developed software package. Excise Duty. in the value of investments. (ii) Conversion Foreign currency monetary items are reported using the closing rate. packing materials. Sales Tax and VAT deducted from turnover (gross) is the amount that is included in the amount of turnover (gross) and not the entire amount of liability arised during the year. work-in-progress. other than temporary. Sale of Goods Revenue is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer. it is recognized as income over the periods necessary to match them on a systematic basis to the costs. Cost of work in progress and finished goods includes materials and all applicable manufacturing overheads. Where the grant or subsidy relates to an asset. Cost is ascertained on First-in-First out (‘FIFO’) basis and includes all applicable costs incurred in bringing goods to their present location and condition. i) Inventories Inventories of raw materials. where necessary. Interest Revenue is recognised on a time proportion basis taking into account the amount outstanding and the rate applicable. The Company accrues for excise duty liability in respect of manufactured finished goods/intermediary inventories lying in the factory. whichever is lower. and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined. Software development expenses are amortised over a period of three years. finished goods. stores and consumables items are valued at cost or net realizable value. its value is deducted in arriving at the carrying amount of the related asset. Provision. 118 . l) Foreign currency translation (i) Initial Recognition Foreign currency transactions are recorded in the reporting currency. by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction. h) Investment Long term investments are stated at cost. is made to recognize a diminution. which it is intended to compensate.

P. it is probable that an outflow of resources will be required to settle the obligation. n) Retirement and other employee benefits Retirement benefits to employees comprise payments for gratuity.R. in respect of which a reliable estimate can be made. 2007 Place: Mumbai Date: June 6. leave encashment and provident fund. o) Sales promotion items Sales promotion items are valued at cost or net realizable value. p) Provisions A provision is recognised when an enterprise has a present obligation as a result of past event. 2007 119 . deferred tax assets are recognised only if there is virtual certainty that such deferred tax assets can be realised against future taxable profits. whichever is lower. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. As per our report of even date For S. m) Income-tax Tax expense comprises of current. Current income tax and fringe benefit tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act. Deferred income taxes reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates. Provisions are not discounted to its present value and are determined based on best estimate required to settle the obligation at the balance sheet date. Contributions to provident fund are charged to the profit and loss account as incurred. The Company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during the period. 2004 are added to the cost of such assets in line with Old Accounting Standard 11 (1994). If the company has carry forward of unabsorbed depreciation and tax losses. Exchange differences on liability relating to fixed assets acquired within India arising out of transactions entered on or before March 31. q) Excise duty Excise duty on turnover is reduced from turnover. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. deferred and fringe benefit tax. separately in the Profit and Loss account. Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M. the said asset is created by way of credit to the Profit & Loss Account and shown as MAT Credit Entitlement. Excise duty relating to the difference between the opening stock and closing stock is recognized as income/expense as the case may be. The liability for gratuity and leave encashment is provided for based on valuation by an independent actuary at the year end. Ramachandran Partner Chairman and Managing Director Membership No: 41870 Place: Mumbai Date: June 6. Cost is ascertained on First-in-First out (‘FIFO’) basis and includes all applicable costs incurred in bringing goods to their present location and condition. In the year in which the Minimum Alternate tax (MAT) credit becomes eligible to be recognised as an asset in accordance with the recommendations contained in the Guidance Note issued by the ICAI. Unrecognised deferred tax assets of earlier years are re-assessed and recognised to the extent that it has become reasonably certain that future taxable income will be available against which such deferred tax assets can be realised. Exchange differences arising in respect of fixed assets acquired from outside India are capitalized as a part of fixed asset.

P. 100. . . . .00% —Amount . . . . . . . . .00% — —Amount . . . . . . . . . . . .85 million were redeemed on March 27. 12% Redeemable cumulative preference shares of Rs 1. 2. . 72. . . . . . . . . . — 2.79 — Dividend on 12% Cumulative Redeemable Preference Shares —Rate . . . . . . . . . . .00% —Amount . . .00 — —Corporate Dividend Tax . .00% — 25. . . . . . . . . 2007 Place: Mumbai Date: June 6.Annexure V: Details of Rates of Dividend The dividends declared by the company during the period ended March 31. .57 10.18 10. . 3. . .42 — — 1. .57 72. . . . . . . .R. . as restated of Jyothy Laboratories Limited. . — — — — — 0. . . . June 30. . — 25. . . . . . . .00% — — 25. . .14 10. . . . Ramachandran Partner Chairman and Managing Director Membership No: 41870 Place: Mumbai Date: June 6. . . .57 72. . . 10. . . . .00 56. . . .02 Notes: 1. . . . — 18.00% 100. . Particulars (Rs Share) 2007 2006 2005 2004 2003 2002 Class of Shares Equity share capital . June 30. . 2002. (Amount INR Million) Nine months Fifteen months ended Year ended Year ended ended Year ended Year ended Face Value March 31. . The amounts paid as dividend in the past is not indicative of the dividend policy in the future. . . — — — — — 0. . . . . . . . . . .00 —Corporate Dividend Tax .18 1. . . . . The figures disclosed above are based on the summary statement of assets and liabilities. . . . . June 30. . . .00% 15. . . . 2007 and the last five financial years are presented below.22 —Corporate Dividend Tax . . . — — — — — 12. . 2007 120 . . .57 72. As per our report of even date For S. Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M.00% 15. .00 12% Cumulative Redeemable Preference Shares . .57 72. . . .89 — 14.52 — 1. . .89 — — 14.43 Final Dividend —Rate . . .57 56. 10 72. . .55 1. . 100 — — — — — — (Refer Note 3) Dividend on Equity Shares Interim Dividend —Rate . . March 31. . . March 31. as restated and summary statement of profits and losses.

12 General Reserve .829. . . . . . . . . . . . . . . . . . . .67 1. . . . .66 1. . . . . . . . . .97 Profit and Loss Account . . . Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M. . . . . . . . . . . . As per our report of even date For S. . . . .829. . .30 Total Shareholders’ Funds (b) 2. . . . . . . . . . .12 1. . . . . . . Post issue Particulars 2007 (Note 1) Long Term Debts Term loan from bank . . . . . . . . . . . . . . . . . .30 391.00:1 0.67 Shareholders’ Funds Equity Share Capital . . . .66 Total Long Term Debts (a) 1. . . . . . . . .96 Total Long Term Debts / Shareholders’ Funds (a/b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The figures disclosed above are based on restated summary statements of Jyothy Laboratories Limited as at March 31. . . 2007. . . . . 2. . . . . . . 0. . .P.96 2. . 0. . . . . . . . .00:1 Notes: 1. . . . . . . 1. . . . . . .57 72. . . . . . . . . . . . . . as restated (Amount INR Million) Pre issue as at March 31. . 2007 121 . . . . . . . .97 1. . . . . .297. . . . . . . . . . . . . . . It is proposed to offer the shares of the existing promoters through offer for sale and thus. . . . . . . . . . . . there will be no increase in the existing share capital of the company and therefore the post issue figures are the same as pre issue figure. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .57 Share Premium . . . 72. . . . . . . . . . . . . . .01 0. . . . . . . . . . . . 2007 Place: Mumbai Date: June 6. . . . . . . .068. .297. . . . . . . . . . . . . . . . . . . .Annexure VI: Capitalisation Statement. .R. . .068. . 1. . . 1. . . . . . . . . . . . . . . . . . . Ramachandran Partner Chairman and Managing Director Membership No: 41870 Place: Mumbai Date: June 6. . 391. . . . . . . . . . . . .01 Deferred sales tax loan . . . . . . . . . . . . . . . .

as restated Net worth. Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M. .36 Return on net worth (%) .256. 3. . . . Ramachandran Partner Chairman and Managing Director Membership No: 41870 Place: Mumbai Date: June 6.06% 23. . .43 Weighted average number of equity shares outstanding during the year/ period used for: —Basic earnings per share .88 350. March 31.53 262.594. . . .880 6. .128 5.36 Diluted earnings per share (Rs) . March 31. at the end of the year/ period Net asset value per equity share (Rs) Net worth. . .594. the net profit attributable to equity shareholders and weighted average number of shares outstanding are adjusted for the effects of all dilutive potential equity shares from the conversion of 2% Fully Convertible Debentures as at March 31. 2003.72 (34.000 —Dilutive earnings per share .600. For the purpose of calculating diluted earning per share for year ended March 31.256. . . . .256.P. 2007 122 . June 30. . adjusted by the number of equity shares issued during the year/ period multiplied by the time-weighting factor. Weighted average number of equity shares is the number of equity shares outstanding at the beginning of the year/ period.880 7. . . . . . . . as restated. .880 7. at the end of the year/ period Number of equity shares outstanding at the end of the year/ period 2.880 5.880 7. Particulars 2007 2006 2005 2004 2003 2002 Basic earnings per share (Rs) . . .256.880 6. .95% 9. as restated.256.22% 14.87 44.53) 15. 2007 Place: Mumbai Date: June 6.75 46.600. 390. . 13. June 30. as restated. .256.600. .36% Net asset value per equity share (Rs) .600.256. . . . . . . Earnings per share calculations are done in accordance with the Accounting Standard 20 ‘Earnings Per Share’ issued by the Institute of Chartered Accountants of India. .000 Total number of equity shares outstanding at the end of the year/ period . .72 (34.93 46.53) 18. . June 30.88% -11. . . As per our report of even date For S. .67 63.87 44.256. 51. 4.880 5.22% 18.67 63. .880 7.Annexure VII : Statement of Accounting Ratios.000 Notes: 1. . . The number of equity shares is the aggregate of the weighted average number of equity shares and the maximum number of equity shares which would be issued on the conversion of all dilutive potential equity shares into equity shares.256. . attributable to equity shareholders Earnings per share (Rs) Weighted average number of equity shares outstanding during the year/period Return on net worth (%) Net profit/(loss) after tax.880 7.128 7. . The time-weighting factor is the number of days for which the specific shares are outstanding as a proportion of the total number of days during the year.256. .880 7. 7.000 5. . The ratios have been computed as below: Basic and Diluted Net profit/(loss) after tax. . as restated Nine months Fifteen months ended Year ended Year ended ended Year ended Year ended March 31. 2003. .R. 7. .85 198.61 300. . 51.600.880 7. 5. .256.000 5. . 7. The figures disclosed above are based on the Restated Summary Statements of Jyothy Laboratories Limited.63 208.

. . . . . . 2007. . 0. . . . . .01 0. . . . 2007 123 . . receivables.01 — — 0. 1.01 0. . . . . . 2007 Place: Mumbai Date: June 6. . . Ramachandran Partner Chairman and Managing Director Membership No: 41870 Place: Mumbai Date: June 6. . . . . The figures disclosed above are based on the Restated Summary Statements of Jyothy Laboratories Limited.01 33. .01 0. .66 1. . .49 (ii) Cash Credit Facilities .66 1. . Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M. As at March 31. . . 3.43 67. .33 — — — Total . . . . . . . — — — 33. . . . 1. 2007. . March 31. . .43 67.65 62. . . . .33 — — — Notes : 1. . term loan from bank is secured against first charge on standing crops on land.027. . . which is payable to government in sixty monthly instalments starting from the month of September 2008.80 B) 2% Fully Convertible Debenture . . . . . .P. 2007 2006 2005 2004 2003 2002 Secured Loan A) From Banks (i) Term Loan .95% per annum for the nine months period ended March 31. .43 67. . 0. .R. .01 0. . . . . June 30. . . — — — — 965. . . . . .Annexure VIII : Details of Loans (Amount INR Million) As at As at As at As at As at As at March 31. . . . . . . . . . March 31.31 0.01 33. . . . .17 0.65 1. Interest on term loan facilities from bank was 7. . . . . . . . . . investments and other movable assets. . .17 0. . . .01 0. . . . June 30. . . . . . . with simple interest of 12% per annum. .01 0. . . . June 30. . 2003. . . . . . . . . As per our report of even date For S. . .65 62. . . . . . . 2. . . .80 Unsecured Loan Deferred sales tax loan . Deferred sales tax loan represent the deferment of tax collected under the provisions of Kerala Value Added Tax Act. . . . . . .00 — Total . . . . .

.29 137. . . . .61% 15.40 — — — Related Non Recurring Profit on sale of fixed assets (net) . . .07 1. .72 Net Profit before tax. . — 3.95 28.55 Not Related Non Recurring 76.20 1. . 2007 Place: Mumbai Date: June 6. . Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M. as restated (B) . . — 7. . * Since there is a net loss before tax. as restated (Amount INR Million) Nine months Fifteen months ended Year ended Year ended ended Year ended Year ended March 31. .55 2.37 1. . .35 Not Related Non Recurring Miscellaneous income .06 6.89 72. June 30. . . .25 37.43 3.58 — Related Recurring Processing income .80) 136.15 Not Related Non Recurring Interest on fixed deposit .43% Nine months Fifteen months Related / Not ended Year ended Year ended ended Year ended Year ended Related to Source of Other March 31. . — 4. . As per our report of even date For S. . . Ramachandran Partner Chairman and Managing Director Membership No: 41870 Place: Mumbai Date: June 6. 61. . . the percentage has not been shown. . .31 — — — Related Recurring Bad debts recovered . . . . 2007 2006 2005 2004 2003 2002 Other Income. The above amounts are as per the summary statement of profits and losses. . . — 26.48 0. as per Summary Statement of Profits and Losses.83 13.P. .66 13. . Business Income 2007 2006 2005 2004 2003 2002 Activity Nature Dividend received . . . . . .24 — 0.42 397. . . 2. . .25 8. .29 67. June 30. — — — 0. — — 0.15 5. .35% 7. .82 0. 1.90 1.60 Not Related Recurring Export incentives . March 31. .51 — — — — Related Non Recurring Credit balances written back .65 60.07 Related Non Recurring Lease rent income .86 292.43 0. .21% 24. . .16 — — Related Non Recurring Sales tax incentives . . as restated. . 0. June 30. June 30.09 0. . . . . . .91 559.10 31.16% — * 23. . March 31. March 31. 418. . . . . . . . .08 0. .29 137. as restated of the company.96 21.R.10 0.80 1. .10 31. 18. .29 67. . 4. The classification of other income as recurring/non-recurring and related/not related to business activity is based on the current operations and business activity of the company as determined by the Management. .25 13.18 Percentage (A/B) . . . .63 49. . .96 21. . . . June 30. . June 30.32 1.58 (260. . . . . . .52 — — — — Not Related Non Recurring Excess provision written back . as restated (A) . . 76. 2007 124 .65 60. .Annexure IX : Details of Other Income.43 — — — Related Non Recurring Profit on sale of investments . 8. . . — 0.53 1.12 0.72 Note : 1. . . . . . March 31. .50 2. . . . . 3. .43 6.

. . .71 (19. .52) — — 0.66% 33. . . . .67) (165. . .80) 136.70% Tax expense at weighted average rate . .97 0. As the Restated Financial Statements have been prepared on financial year basis. . . . . .32) Capital Expenses not allowable under Income Tax Act . . . . . . .Annexure X: Tax Shelter Statement (Amount INR Million) Nine months Fifteen months ended Year ended Year ended ended Year ended Year ended March 31. . . . .47 71. . . . . . . . . .18 Tax Rate in % . . .00 — Deduction u/s 80IB of Income Tax Act . 141. . Ramachandran Partner Chairman and Managing Director Membership No: 41870 Place: Mumbai Date: June 6. . .30 98. .70 89.23) 30. .94) 50. . . . . . June 30.24 55. .59) 4. . . — — 5. . . (309. .81) 54. . .30 104.56) Deduction u/s 80HHC of Income Tax Act . . . . 418. — 29.30) (98. . .51 (4. . . . .54) (285. . — (4. . June 30.00 188. .42 397. . . . . . .58 (260. . . Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M. . .94 — 11. .24) (82.63 (0. .75% 35.26) Other disallowance under Income Tax Act (refer note 2) .59 71. 33. . . . . .31 Provision for income tax (including deferred tax) as per the restated summary statements . . Particulars 2007 2006 2005 2004 2003 2002 Profit Before Tax. . .47) 168.55) (86. . . . . . . .01 Provision for diminution in value of investments . (2.30 142.47) (102.14 (33. .47) (71. . . . . . (104.83 71. . . . (4. the applicable tax rate is the weighted average of the rates applicable for the periods April to June and July to March. . . .R. . . . . . . . . . . . . .50) Incremental Tax as per Section 115JB . . .70) Tax Expense/(Saving) on net adjustment . . . . . . . . . .56) (306. . .89) — (57. . . . . . 104.42 (60. . . . . . . . . March 31. . . 2007 Place: Mumbai Date: June 6. . .71) 19. . .36) 60. .91 559. . . . .97) (15. . . . . . . . . . . . .30) (98. . . . . .P. .42) 60. . . .86% 36. (104. June 30.74) Note: 1.59) (71. .66) 224. . (302. . . .56 (93. . . . . . . March 31.18 — — — — Brought forward Business loss and Unabsorbed Depreciation (refer note 2) . . .71 (30. . . . . . . . . .00 3. .66 — — Deferred Advertisement Expenditure (refer note 2) . . — — (224. . . . . . . . Deferred tax is not recognised for unabsorbed losses due to absence of virtual certainty at the end of the period and for the expenses where timing differences is expected to reverse during the tax holiday period. . .86 292. . .42 (8. net . . — — — — 0. .57 Difference . .33) 4.02% 36. . . .54 (83. . . . .86) (292. .03 22. .57) Total . .74 Adjustments Permanent Differences (Profit) / Loss on sale of investments. .02) (119. . .76 Total . 2007 125 . .88 0. . . . . . . . . . . As per our report of even date For S.66% 35. — — 30. . . . . . . .71 32. . . . . — — — (64. . . .32) (264. .62) (94. . . . . . . 2. . . . . . 36.67 — — — Other permanent differences . as restated .

63 — M.07 114.85 — — — — Premises under Construction (at book Relatives of Individual M.87 — M.91 3.00 7.79 18.20 1.86 84.32 — — 9.04 33.08 20.89 173.Annexure XI: Statement of transactions with related parties and details of outstanding balances (Amount INR Million) Nine Fifteen months Year Year months Year Year ended ended ended ended ended ended March 31. June 30.14 50.84 1.P.16 48. June 30.97 15.01 5. Ramachandran 3.P.20 1.82 — — Expenses Others 2.10 6.05 5.14 Remuneration Individual having Control $ M.73 65.30 3.Deepthy 0.80 10.G.15 — — having Control M.71 13. Ramachandran 43.00 58.00 Relatives of Individual M.R.P.07 54. June 30.37 — — — — — and Products (P) Limited machinery Purchase of Individual having Control M.74 packing relatives are interested materials Shanti Industries — — — — — 0.63 relatives are interested Relatives of Individual M.P.39 11.83 59.97 47.85 82. Sidharthan 0.46 0. Particulars Nature of Relationship Name of the Related Party 2007 2006 2005 2004 2003 2002 Purchase of Wholly Owned Subsidiary Sri Sai Home Care 78.53 — — — — — Limited Purchase of Enterprises in which Emerald Packaging — — — — 9.P.76 35. Divakaran — — — — 9. Ullas Kamath 2.25 — — — Relatives of Individual Others 19.07 Claim for Enterprises in which Sreehari Stock Suppliers 2.30 40.90 1.50 1.11 1.65 46.20 1.63 — — — having Control Key Management K.81 59.65 — — Promotion Beena Agencies — 0.41 2.21 2.80 6.20 0. March 31.05 — — — — Key Management K.17 — — — — — Ananth Rao T.67 — Sale of plant Wholly Owned Subsidiary Sri Sai Home Care 7.66 95.38 — — Write off of old Enterprises in which Shanti Industries — — 0. — — — — — 1. Ramachandran — — — — 10.53 70.62 7. Santhakumari — 5.94 5.30 0. 0.P.26 45. Ullas Kamath 7. Santhakumari — 6.00 — intangible assets Investment in Joint venture company Balaji Telebrands 0.54 — finished Products (P) Limited goods Joint venture company Balaji Telebrands 10.81 46.58 52. Sidharthan — — — — 14.18 — — — — having Control M.26 15.07 50.P.25 — — — — — shares Limited Dividend Individual having Control M.04 64.45 Agencies Sreehari Stock Suppliers 68.P.79 — — for Sale Tamilnadu Distributors 0.07 7.19 — Products (P) Limited Enterprises in which Quilon Trading Co.90 1.12 140.60 M. Ramachandran — 20.14 Others 145. Jyothy # 0.55 61.00 11.P.33 Personnel Commission Individual M.47 155.14 39.01 8.02 55.27 0. Ramachandran — 7.93 Goods relatives are interested Sree Guruvayurappan 37.38 98.34 60.05 7.50 0.34 Tamilnadu Distributors 35.76 — — — Personnel Assignment of Individual having Control M.R.40 — Fixed Assets Wholly Owned Subsidiary Sri Sai Home Care 0.04 60.60 0.50 2.G.27 1.Divakaran 0.54 168.26 42.33 Sujata Agencies 56.51 10.87 — — — 0.05 — — — — value) having Control Purchases of Individual having Control M.20 1.46 67.67 1.10 10. March 31.46 1.11 — — reimbursement relatives are interested Sujata Agencies 1.93 82.93 1.P.31 — — — having Control Sale of Finished Enterprises in which Beena Agencies 52.28 — — — outstanding relatives are interested 126 .40 47. Ramachandran 8.

63 — 3.09 0.17 — — Tamilnadu Distributors 0. # Director w. Ramachandran Partner Chairman and Managing Director Membership No: 41870 Place: Mumbai Date: June 6.Agencies — — — — 2.01 — — Deepthy Agencies 2.36 48.f.28 — — Agencies M. June 30. March 31.44 1.05 5.57 — — Sreehari Stock Suppliers — 0. Ramachandran — — — — — 5.12 43.07 — — Others — — — — 4.04 1. 2007 Place: Mumbai Date: June 6.76 — 2.75 — — Sahyadri Agencies 0.94 5.35 $ As the managing director of the company is an individual having control and hence not separately disclosed as a key management personnel. Ramachandran 3.49 1.51 0. Divakaran — — — — — 8.08 0. Sidharthan — — — — — 15.P.10 0.88 Key Management Personnel K. Ullas Kamath 2.17 0.51 — — Sujatha Agencies 0.18 1.94 1. Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M.76 Sreehari Stock Suppliers — — — — 6. 0.78 0. — — — — 3.e. 2007 127 .92 2.18 0.99 0.79 2. June 30.96 Sujatha Agencies — — — — 17.P.04 4.18 Agencies Quilon Trading Co.62 0.97 Tamilnadu Distributors — — — — 16.03 Sahyadri Agencies — — — — 1.55 — — relatives are interested Quilon Trading Co.P.36 Travancore Trading — — — — 0. Ullas Kamath — — — — — 3.54 1.P.56 0.55 1.04 0.07 7.30 — — having Control M P Sidharthan — — — 0.63 — Key Management Personnel K.14 Corpn Emerald Packaging — — — — 0.16 — Relatives of Individual M P Divakaran 0.01 0.Annexure XI: Statement of transactions with related parties and details of outstanding balances— (continued) (Amount INR Million) Nine Fifteen months Year Year months Year Year ended ended ended ended ended ended March 31.28 1.59 1.58 — — Travancore Trading 0.02 0.70 Amounts Joint venture company Balaji Telebrands Limited 4.03 0.P. 2005 As per our report of even date For S.13 0.12 Shanthi Industries — — — — 0.76 5. — — 0.98 Sree Guruvayurappan — — — — 2.R. March 31.28 0.03 Sahyadri Agencies Ltd.P.30 3.60 0.60 0.14 0.49 — — — — Emerald Packaging — — — — — 0.83 1.88 53. Particulars Nature of Relationship Name of the Related Party 2007 2006 2005 2004 2003 2002 Amounts Subsidiary Company Sri Sai Home Care 57.78 — receivable Products (P) Limited Enterprises in which Sahyadri Agencies Ltd.26 Relatives of Individual M.53 35.07 0.07 — 0.07 — Enterprises in which Beena Agencies 1.10 — M.84 — — — — — payable Individual having Control M.10 0.34 — — — relatives are interested Beena Agencies — — — — 2.90 7.Agencies 2.44 1.30 0. June 30.28 Individual having Control M. October 24.12 0.98 6.00 having Control M.58 — — Corpn Sree Guruvayurappan 2.P.05 0.33 0.53 1. 0.

01 73.00 June 30. 2004 and March 31. 2004 and March 31. 2005. Shiv-shakti Industrial Estate. June 30. The details of the auditors of the respective companies and the years/period for which the audited financials have been consolidated. 2006. Sodha & Co. We did not audit the financial statements of the subsidiary and the joint venture company for the years / periods ended March 31. 4. M/s A. Sri Sai Home Care Products (P) Ltd. This report is being issued for the purpose of incorporating the same in the offer document. (together referred to as ‘the Group’) as at March 31.15 Balaji Telebrands Limited March 31. 2007 M/s A. June 30.99 110. including the total assets and total revenue of each entity consolidated is as described below: (Rs INR Million) Total Total Name of the Company Year / Period ended Audited by assets Revenue Sri Sai Home Care Products March 31. R. prepared by the Company and approved by the Board of Directors. Marol. 2003 M/s Namboodiri Associates 42. Balaji Telebrands Limited.R. 2003 and 2002 whose reports for the respective years have been furnished to us and our opinion in so far as it relates to the amounts included in these Summary Statement of Consolidated Assets and Liabilities. the Securities and Exchange Board of India (Disclosure and Investor Protection) Guidelines 2000 (‘the Guidelines’) and the related clarifications issued by the Securities and Exchange Board of India (‘SEBI’) as amended to date. to be issued by Jyothy Laboratories Limited in connection with the proposed offer for sale of equity shares by the shareholders. annexed to this report. and d. as restated (‘Consolidated Restated Financial Statements’) are based solely on the report of the other auditors. Consolidated Financial information as per audited financial statements: The consolidated financial information has been extracted by the management from the consolidated financial statements for the years / periods ended March 31. 2004 M/s Namboodiri Associates 52. June 30. 2007 M/s Namboodiri Associates 66. (Subsidiary) March 31. 2006. Sodha & Co. the Guidance Note on Reports in Company Prospectuses (Revised) issued by the Institute of Chartered Accountants of India (‘ICAI’). 2006.35 P Ltd.40 June 30. 1956) To The Board of Directors Jyothy Laboratories Limited 43. 2007.90 June 30.27 (Joint Venture Company) 128 . the terms of our engagement agreed upon with you in accordance with our engagement letter dated May 26. 2007.80 95. 2007 in connection with the offer document being issued by the Company for its proposed Initial Public Offer. and the joint venture company. 2003 and 2002 and approved by the Board of Directors. 1956 (‘the Act’). 2007. in accordance with the requirements of: a.37 5. 2004 and March 31.73 12. Andheri-Kurla Road. Auditors’ report (as required by Part II of Schedule II to the Companies Act. paragraph B(1) of Part II of Schedule II to the Companies Act. Mumbai – 400 059.60 85.67 60. 2005. 2005. and accordingly reliance has been placed on the consolidated financial statements audited by them for the said year. Audit for the year ended March 31. 2003 and 2002. 2002 was conducted by previous auditor. as restated. as restated and Summary Statements of Consolidated Cash Flows. Dear Sirs. We have examined the consolidated financial information of Jyothy Laboratories Limited (‘the Company’) and its subsidiary. 2002 M/s Vasu & Sivram 37. Summary Statement of Consolidated Profits and Losses. 2006 M/s Namboodiri Associates 40. b. Andheri (East). 2005 M/s Namboodiri Associates 42. c.68 March 31.

For S. referred to or distributed for any other purpose without our prior written consent. 2003 and 2002 examined by us. 2007 applied with retrospective effect in the consolidated restated financial statements. we are of the opinion that the consolidated restated financial statements have been made after incorporating: • the impact arising on account of changes in accounting policies adopted by the Company as at and for the period ended March 31. b) Based on our examination. 2007. the SEBI Guidelines and terms of our engagement agreed with you. Batliboi & Associates Chartered Accountants Per Sudhir Soni Partner Membership No: 41870 Place: Mumbai Date: June 6. 2007 129 . 2006. as set out in Annexure I. 2004 and March 31. This report is intended solely for your information and for inclusion in the Offer Document in connection with the proposed public offer of the Company and is not to be used. nor should this report be construed as a new opinion on any of the financial statements referred to herein. In our opinion. and after making adjustments and re-groupings as considered appropriate and disclosed in Annexure IV. c) There are no extraordinary items which need to be disclosed separately in the consolidated restated financial statements. has been prepared in accordance with Part II of Schedule II of the Act and the Guidelines. we further report that: a) The Consolidated Restated Financial Statement of the Group. This report should not be in any way construed as a reissuance or redating of any of the previous audit reports issued by us or by other firm of Chartered Accountants. the consolidated financial information as disclosed in the annexures to this report. 2005. read with the respective significant accounting policies and notes disclosed in Annexure IV and IVA. • adjustments for the material amounts in the respective financial years to which they relate. • the qualifications and material adjustments relating to the relevant previous years / period. In accordance with the requirements of Paragraph B of Part II of Schedule II of the Act. June 30. as at March 31. II and III to this report are after making adjustments and regrouping as in our opinion were appropriate and more fully described in Notes on adjustments for Consolidated Restated Financial Statements and Significant Accounting Policies for Consolidated Restated Financial Statements (Refer Annexure IV and IVA). except to the extent stated in note I-5 in Annexure IV.R.

31 101. . . .28 14. . . . . . . . . 2007 130 . . .88 257.07 Less: Accumulated depreciation and impairment loss . .58 11. .30 D.57 1. . . .17 Total . 72. .61 1. . .80 653. .21 681.96 C. .60 198. .57 56. . . . . . . . .57 72. . . . .06 26. . .93 1.155. .97 211. . . . . . . 1. .02 253. . . .78) (76.27 E. . . . . . . . . . .75 Loans and advances .32 741. 989. . . . .49 270.102. . .16 23. . . . . . .16 9.44 794. .93 24. . . . . . . . . . . . . . .05 1.816. . .85 261. . . . . . . . . . . . .83 17. . . . . 0. 2.267. . .71 322.74 1. . .355. . . . . Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M. . .31 1. . .22 Total . . . .30 235. . . . . . . as restated (Amount INR Million) As at As at As at As at As at As at March 31. . 5. LIABILITIES AND PROVISIONS Secured loans . .099.93 1.46 69. . . .15 — — — — — Net worth (F+G-H) .99 1. . . . . .90 3. . . . . . . .889. . . . . . . . . . . . .62 752. . 2. . .85 Other current assets—Sales promotion items .29 85. 549. . . . .47 36. 54. .Annexure I : Summary Statement of Consolidated Assets and Liabilities. .65 1. .79 H. . . . . . .34 B.22 75. .33 — — — Current liabilities .534. (294.66 20. .31 1. 1. .99 979.39 Total . . . . . . .96 Sundry debtors . .10 261.08 Net worth (A+B+C+D-E) .538. . . . . . .02 1.48 892. 629. .95 Capital work in progress (including capital advances) .155. . Reserves and surplus . . 2. .51 855.79 The above statement should be read with the notes on adjustments for consolidated restated financial statements and significant accounting policies as appearing in Annexure IV and Annexure IVA respectively.16 18. .01 0.81 364. . . . .92 198. .889.18 1. . . .72 334.050. . .85 2. .172. . .78 279. . . . .58 2. . . LOANS AND ADVANCES Inventories . .82 25.829. .64 Deferred tax liability.625. .93) (125.25 2.94 397. .829. . . . . . . . 9. .782. . . . .54 18. As per our report of even date For S.21 1. . . .46 193.P. . . June 30. . . . .12) Net Block .106.01 33. . . . . 8. .50 919. . . . March 31. . .58 186. . . June 30.57 72. . . . . . . . . . . . PARTICULARS 2007 2006 2005 2004 2003 2002 A. .027. .66 1. . . . . .28 844. . . . . . CURRENT ASSETS.64 195. . . 509. Share capital . . .82 2. .91 125. . .277. . . .93 1. . . . . .462.756. . . . . . . 2007 Date: June 6.89 2. . .43 69. .00 56.03 52. . .106. . . . . . . .54 217. INTANGIBLES . . . .14 1.284. . .22 769. . . Ramachandran Partner Chairman and Managing Director Membership No: 41870 Place: Mumbai Place: Mumbai Date: June 6.97 135. . . . . . . . June 30.29 240. . . . . . . .77 413. . . . . . . .00 G. . . . . INVESTMENTS . . . .01 2. . March 31. .43 605. . . . . . . . . . net .17 0. . .72 20. .49 Cash and bank balances . . . .13 197. .11 9.79 Net worth represented by F. . .81 106.78 249. . 158. .46 4. . . . . .93) (258. .14 1. . . . . . .77) (209.099.172. . . .R. . Miscellaneous Expenditure (to the extent not written off or adjusted) . . .96 Provisions . . .73 779. .55 341. . 2.534. .24 2. . . . .01 0. . . . . . . 1. . . . .959. .31 Unsecured loans . . . 690. . .24 2. .44 849. . .71 362. . . . . . . . .75 285. . .57 72.91 37. . . . . .83 13.93 40. . .06) (50. . 50. . .01 598. . . . . . . . 300. .81 1. .89 135.58 2. .59 599. . . .719. . FIXED ASSETS Gross Block . . 400. .10 570. 0. . . . . . . . . . .

.89 — 14.85 280. .08 1. .72) (76.48 157. . . . .205. .65 334.66 (190. . . .56 56. . . . . . . . . . . .70) (389. . . . .57 (158. . 496. .22 2. . . . . . . . .43 189.92) 20. . . . . . . . . . .19) 5. . . .85 223. .14) (242.019. . . . . . . .600. 448. .61 490. . . . . . — — — — — 0. . . 395. . .83 Less: Sales tax recovered . . . . . . . Ramachandran Partner Chairman and Managing Director Membership No: 41870 Place: Mumbai Place: Mumbai Date: June 6.81 1. . . . . . . . . . . . . . — 18. . . .P. . . . . . .95 25. . . . . . . . . . . . . . . . . . . . June 30.59 286. . . . . as restated . . . . . . . . . . . . . DEPRECIATION AND TAX (A-B) . . . . . . . . . . . . 1.79 175. . . . . . .653. .81 121. . . .90 57. . . 45. . . . . . . .00 160. .29 57. . . . . . . . . .64 57. . . (18. . .22 947. . . . 2007 131 . . .21 Operating and administrative expenses .496. .663.09 (31.17 Balance available for appropriation. . . .25 584. . . .38 Advertisement and publicity . . . .03 2. .89 14.828. June 30. 1. . . . .470. . .34 487. . As per our report of even date For S. .556. . . .57) (refer note no. . . . . . . . . . . . . . . .42 PROFIT BEFORE PRIOR PERIOD ITEM. . . .89 — — 14. . . . .27) (160. . . . . .00 262. . . .59 286. . . 2007 Date: June 6. . . . . — (28. . .15 53. . .47 3. .425. EXCEPTIONAL ITEM. . .25 320.665.95 21.50 2.25 332. .70 78. . . . . . . . . . . .49 312. AS RESTATED . . . . . . . . . . . .82) 96. . . . 2.23) Less: Trade discount (refer note no. . I-2 of annexure IV) NET PROFIT.66 — —Fringe benefit tax . . . . . . . March 31. . . . .82 1. . .23 21. . .97 2. .28 3. . . .72 Total Income (A) .66 Prior period item—Advertisement expenses . . . . . . (4. . (58. . . . . . . . . .71 (230. . .14 10.572. . . . . . . . .00 394. . . .80 20. .23) 207. . . . . . . . . 336. .27 0.57 34. .77 3. . — — — — — 0. . . .Annexure II: Summary Statement of Consolidated Profits and Losses.47 0. . . . . . . . . . . . . 388. . 93. .50 2. . . . . . . . . . . .68 (32. . . . . . . . .38 462. . . . . . . . . . . . . . . .75 (23. .13 497. . . .57 10. . .08 21. 2. .31 348. . . . . . . . . . .33 2. . .82 18. . . . .42 — — 1. . .001. . . . . . . . . . .43 Proposed dividend on equity shares . . . . . (286. . . .30 25. . . . . . . . . 2. .43 0. . .57 72. . .18 1. . 3. . . . . .48 260. . . . . . . . . . . . . . . . . . .19 25. .68 283. . . . . . . . . . .36 (112. . . . . . . . . . . . .22 Tax on dividend on preference shares . . . . . . . . . . .61 429.66 31. . . . . . . . . . . . I-3(g) of annexure IV) . . .175.66 Interest and finance charges . .79 255. . . — 2.61 Sales promotion and schemes .45 16. . . . . .13 5.63) (6. . .95 2. . . .65 1. . . . . . . . . . . .30 287. . . . . . . . . .05 115. .943. . . .00 — Tax on proposed dividend . . . . . . . . . . . . . . . . .453. . . . — (6.26 APPROPRIATIONS Interim dividend on equity shares .38 298. . . .15) 177. .22 — Total Expenditure (B) . . . . . . . .66 ADJUSTMENTS . . . .00 309. .142. . . . . . . . . . . . . . . . . . .R. . . . .294. . . . .40) (70. . . .00 NET PROFIT BEFORE ADJUSTMENTS . .59 207.00) — — — PROFIT BEFORE INTEREST. . June 30. . . . . . .54 519. . .80 — — — —Wealth tax . . . 377. . . .43 274. . . .02 Transfer to general reserve .66 Provision for tax —Current tax (including short/excess provision for current tax of earlier years) . . . . . .70 1. . .50) (206. .24) Less: Excise duty recovered . . .319. . . .00) (195.518. . . . . . 52. 48. . . . .00 Tax on interim dividend . . . .03 (Increase)/Decrease in finished goods/work in progress . 0. . . 225.25) — Net sales (refer note no. . . .20 28. .39) (45. . . . .92 91. . .69 398. . . . . . . . . . . . . . .10) Employee costs . . .48 266. . . . . . AS RESTATED . . . . 102.03 47. .36 (87. . 72.90) 35. and significant accounting policies as appearing in Annexure IV and Annexure IVA respectively. .41 3. . .00 TOTAL . . . . . . . . . . . . .46 2. .463. .713. . . . . .17 60. . . . .14) (203.97 Depreciation / amortisation .85 420. .11 0. . . . . . . .775.61 2. .03 TOTAL . . . . .67) (80.48 (23. . . .23) 383. . . . . .09 Profit and loss amount at the beginning of the year / period . . .08) 259. . . . . . . . . . . 496. . .97 50. .14 (72. . . . . . . . PARTICULARS 2007 2006 2005 2004 2003 2002 INCOME Sales (gross) . . . . . . 471. . . . . . . . .01 3. . . . 303. . .75 (23. . 0. . . . . . .50) — (24. . . .48 1. . . 47. . .86) (99. . . .67 BALANCE CARRIED FORWARD. . .57 3. .91 292. .878. . . . . . . IV of annexure IV) . .15) (273. .48 2.50 0. 44. . .23) 207. .00 — 160. .59 The above statement should be read with the notes on adjustments for consolidated restated financial statements. . . 10. . . . . .088. .38 93. . .02) 259. . — — (60. . . . . .21) (7. . . . . . . . . . . . . . . . . . . . .83 60. . . . .75 403. .54 1. . . . . . .359.382. . . .28 13. . . . . . . . . . . . . March 31.29 Provision for doubtful debts / Bad debts written off . .72 344. . .50 25. .50 29. . . . . . .50 49. . .51 2. .56 462. . .37 32. . .40 109.00 PROFIT BEFORE TAX . . . . . .70 (56. . .27 31.52 3. . . . . . . . . . . .30 2. .00 —Deferred tax . .140. . . . . . as restated (Amount INR Million) Nine months Fifteen months ended Year ended Year ended ended Year ended Year ended March 31. . . . . . . . . . . . . . . . . . . . . . . .62 271.08 487. . . INTEREST. . . . . . .57 34. . . .05) 212. . . .08 EXPENDITURE Materials consumed . . . . . . . . . . . . — 300. . . . . . .34 3. . . .94) — — Prior period item—Trade discount expenses .96) (6. .36 Other income . . . . .13) 63. 2. . . . . . . . .18 10.53 75. . .78 329. . . (174. .860.25 548. .53 — 1. . .26) (54. . .40) (59. .14 — TOTAL . . . . . .32 1. 82. .79 — Dividend on preference shares . .13 0. . .00 250. . . . . . . . . . . . .85) — — — — Exceptional item—Provision for dimunition in investments . . . .13) (0. . .09 3. DEPRECIATION AND TAX . .74 8. . Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M. . . . . . . . . . 7. . .73 — 175. .49 312. . . . . .

.53 50.82) Increase / (Decrease) in current liabilities / provisions . . . .85 261. . June 30. . .91 390.60 Dividend received . . . . .08 0. . . . .08 21. . .97) Dividend paid . . .72 B. .62) 908. . . . . . . . .01 (Profit) / Loss on sale of investment . . . . . . . . . . . . .28 524.85 132 .74 8. . .277. . . . .59) Loans and advances . (0. . . . . . . .18) — — — — — Debenture issue expenses . . . . . . . .66 Adjustments for: Depreciation . CASH FLOWS PROVIDED BY / (USED IN) FINANCING ACTIVITIES: Borrowing / (Repayment) of loan funds . . . . . . . .08 394. . . . .52 — — 19.89 292.24) (8. . . . . . . . . . . . . . . . . . . . . .01 2. .65) (123. . . .36 — (33.24 55. .61 1. .72 —Deposit account . .90) (72. .Annexure III : Statement of Consolidated Cash Flows. . . .83) (95. .38) (47. — 4. . . . . .04 — — — — — Dividend received .48 892.59 599. .32) 163. . . .95 29. March 31. . . 89. . 176. . . . . . . 422. . . . . . . . . . . . . . . . . . . . . . . .25 Repayment of preference shares . .04) (43. . . . . . . . . .81 — 3. . . . . . .50 49. . . . . . . . . .14) Net cash generated from / (used in) operating activities . .33 — — — Interest paid . . . . .27 0. . . . 4.10) (3. . . . . .54 1. . . 0. . . . . .85 329.00 3. . . . . . . . .94 598. . .24) 0.00 (67. . . . . . .02 559. . . . . . .52) (38.90) Net cash provided by / (used in) used in financing activities . . . . . . . . .56) (189. .51 42. . . .85 (Increase) /Decrease in current assets.18) (275. . . . . . . . .28 Purchase of investments .97) (110.64 511. . . . .194.84 108. . . — — (0. . .71) (1. (0. . . . . . . . . . . . . .48) (95. . . . . . . . .84 1.97 (153. . . June 30. 2. .25) (3. . . . . .08) (1. . . . 0. .12) (0. .06 (278. . . . . .15) (19. . .36 23. . . .40) 208. . . .68 (42. . . . . . . .09 0. . .95) (5. . . . 0. . . .07 — 0.66) (13.89) Net increase / (decrease) in cash and cash equivalents (A+B+C) . 599. . .07) Provision for dimunition in the value of investments . .26 37. . . . . . . . . .45) (10. . . . . . . .68) (31. .86 — Provision for assets held for disposal . (2. . .77 641. . 1. .92) (28.80) (20. . . . . .15 31. . . . . . .03 (Profit) / Loss on discarded/sale of fixed assets. . . . . . .81 16. .72) (11. . . . — — — 1. . . . . . . . .63 49.42) (65. .23) (50. . . . . .67) (138. . . . .97 690. . . .93 5.94 2. . . . . .15 Net cash used in investing activities . . . . . . . . . . .66 13. . . — (0. . . . — 3. . . . . . . .60 (33. . .02 (40. . . . .80) Trade receivables . . . .17 94. . .10) (0. . . . . . . . . . .60) Excess provision written back . . . . . . . . . . .86 0. .60) (57. .42) Dividend tax paid .54) (45. . . . . . . . . . . . . . 690. . . . . . . . . . . . . . 0. . . — — 5. . — 13. 2. . . . . .277. .97 Interest income .22 Cash generated from / (used in) operations . . . . . . . . . . .78) (26. . . . . . . . .25 (0. . .53) (114. 2007 2006 2005 2004 2003 2002 A. (12. . . . . .277.96 (23. .45 1. . .21) Receipt of investment subsidy . . . (64. . CASH FLOWS PROVIDED BY/(USED IN) OPERATING ACTIVITIES: Net profit before taxation. . .01 393.08) (0. .46) 18. . . . . . .95 28. . . . .48 892. . . . . . . . . net .67 847.85 261. . . . . . . . . . . . . . . . . . . . . .42) (1. . . .64) (28. .97) (35. (586. . . .12 4. . . .49 1. .71) (83.57 (194. . 3. . . . . . . 1. . .67) — Deferred sales tax loans . . . . . . . (50. — (4. . . . . .90 72.55 — — Provision for doubtful debts / Bad debts written off . .03 (0. . . . . . .37 72. . .14) (5. . .53 0. . . . . . . .95) (28. . . . . . . March 31.86 Taxes paid . . . . . . 0.16 Balance with scheduled banks—Current account . . . . 45. . . . . . .16) — — Sundry advances written off (net of provision) . . . .08) (14. . .76 8. .83) (256. .09) (0. . . . . . . . . . . . .59 599. . . . . .12 0. . . . . .85 261.22) C. . . . . CASH FLOWS PROVIDED BY/(USED IN) INVESTING ACTIVITIES: Purchase of fixed assets (including capital work-in-progress and capital advances) . 415. . . .50 0. . June 30. . . . .83 293. . . .10 0. .21 (37. . (90. . . .39) Cash and cash equivalents at beginning of year / period . . . . . .63) (49. . . . . . . . .22 — Operating profit/(loss) before working capital changes .26) (37. . . . . . .00 — — Provision for doubtful advances . .99 2. . .10 1. . . . (667. .24 Cash and cash equivalents at end of year /period . . . (50.00 0. .56 56. 119.16) 83.02 (0. . . .87) 384. .25 (263. . .62) 128. . . . . . . .36 0. . . . — — — (0. . .82) (0. . . (604. . . .08 1. . .10) — — — Proceeds from sale of investments . . .62 752. .52) — — 0. . . .90 57. . . .96 446. . .78) 958. .84 0. . . (61.14 5.54 44. . . . .79) (46. .98 (249. . . — — — — — (1.62 752. . (307. .61 1. . . . .08) (54. . . . . as restated (Amount INR Million) Nine months Fifteen months ended Year ended Year ended ended Year ended Year ended March 31. . . .40) 75. . . . . . . . . . . . . . . . . . . . . . .99 — Proceeds from sale of fixed assets . . .97 — Miscellaneous expenditure written off . . . . 61. . . .85 6. . . . . . . . .01 287. . . .10 560. .84) (51. . . . .09) 306. . . (101. . .80 3. . . . . . . . . . . . . .48) (0. . . . .29 (314. .15) Interest expense . . . .62 752. . .80 20. . . . .83 160. .59 28. . . . . . .56 1. .95 81. . . . . .79) — (2. . . . . . . . . .38) 226. . . . . . . . .09 3. . . . . .48 892. . . .77) (104. . . .23) (162.47 0. . . .60) 252. . . .85 Components of cash and cash equivalents Cash in hand .23) (32. . .04) Interest received .47) (0. . . . . . .23) 491. .85) Preliminary expenses . . . . . . . . . loans and advances Inventories (including sales promotion items) .59 599. . . . 184. . . . . as restated . .00) — (28. . . .89) (14. . . . . . . . . . . . . .

As per our report of even date For S. 2007 133 . Ramachandran Partner Chairman and Managing Director Membership No: 41870 Place: Mumbai Date: June 6. 2007 Place: Mumbai Date: June 6.R.P. Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M.

.21) (7. . . . . . . (18. . . . . — — — — — (9. 8. — — 55. . . . . . — — 80. 2003. . . . .56) (24. — 6. .57) Current Tax Impact of Adjustments (See note no. . . . . . . on account of first-time application of the standard has been reversed appropriately in the summary statement of profits and losses. .99) (7. . PARTICULARS 2007 2006 2005 2004 2003 2002 ADJUSTMENTS Impact of changes in accounting policies and estimates Dimunition in the value of investments (See note no. the Accumulated Profit and Loss balance as at April 1. June 30. . . . . . . . . . . . . . . . . . . . . — — — — (4. . . Jyothy Laboratories Limited Listed below are the adjustments which have been made in the restated summary statements of consolidated profits and losses and consolidated assets and liabilities. . 2003. . . Accordingly.00) — Deferred tax (See note no. . . . . . . . . . . .85) — — — Sub Total . .78 — Total . . . Deferred Tax The Company adopted Accounting Standard 22. I-3(a) below) Advertisement expenses . March 31. . . . . . . . 1 above) . .40 109. . . . . . . . . .54 (17. . . . . . as if it was applicable since then. . . and summary statement of assets and liabilities. I-6(A) below) . . . . . . . . . . . I-3(c) below) . I-3(b) below) . . . . have been excluded from the list of adjustments given below. For the purpose of this statement. . June 30. .31 2. Jyothy Laboratories Limited. . . .05) 69.94) — Trade discount expenses .51 — — — — Depreciation (See note no. . . . . . .51) 26.36) — Other adjustments Sales returns pertaining to year 2003-04 (See note no. . .00 — — Bad debts recovered (See note no. . . .40 117. . . (26. .84 (72. . . . . .85 (6. . . . 1. . . .25 Prior period items (See note no. .23 0.00 — (55.54) — 7. . . which get eliminated on consolidation. .82) Unspent liabilities written back (See note no. . (0. .13) 63. . . . . 2. . . . . . . Further. . . . . — 28. . . . as restated. . . . . . . AS-22 has been applied for the year ended March 31. 2002. . . . . . . .50 — (3. . . . . . . . . . . .54) — — — Short/(Excess) provision for current tax of earlier years (See note no. . . the deferred tax asset/liability has been recomputed in the respective years of origination. . . . . . . . . . .67) (83. . . .00) — — Trade discount for year 2004-05 (See note no. I-3(d) below) . . (‘AS-22’) ‘Accounting for taxes on Income’ issued by the Institute of Chartered Accountants of India (‘ICAI’) for the first time in preparing the financial statements for the year ended March 31. .57) 134 . . .14 (72. . . .00) — 10.89 0. . I-3(d) and I-3(e) below) . Below mentioned is the summary of results of restatement made in the audited accounts for the respective years and its impact on the profits / losses of the Company. . . . .70) — 3. as restated. (Amount INR Million) Nine Fifteen months Year Year months Year Year ended ended ended ended ended ended March 31. . (27. . .67) (80. . . I-3(g) below) . . . . . . . . . . II-1(a) below) . . Adjustments. . . . . . . . . . . . . . . June 30. . . . . . Notes on adjustments in Consolidated Restated Summary Statements pertaining to Parent Company. . March 31. . . . . . . . . . . — 17. . . .92 (6. 2001 has been appropriately adjusted to reflect the impact of deferred tax liability as on that date and accordingly the amount earlier adjusted to the opening general reserves for the year ended March 31. .ANNEXURE IV Notes on adjustments for Consolidated Restated Financial Statements I. . . — (10. . .00 (80. . . . . I-3(f) below) . . . . . . . . . .00) (8. . to the extent they pertain to the parent company.

for the period / year ended March 31. 2006. For the purpose of this statement. For the purpose of this statement. a liability created in an earlier year was written back. adjustments have been made to the summary statement of consolidated profits and losses. 2006 and which have been subsequently recovered. have been adjusted in the year when such debts were originally written off. 2005.00 for returns pertaining to sales of this product made in the period ended June 30. AS-26 has been applied for the year ended March 31. 2004. the Company has capitalized the amount of additions made to software development under the Intangible Assets in the accounts for the year ended March 31. 2007 and June 30. 2006 and June 30. has been appropriately adjusted in the financial statement for the period ended June 30. in respect of shortfall/excess income tax arising out of assessments. The effect of adjustments relating to financial years ending prior to March 31. the Company had issued credit notes aggregating Rs 80. for the years ended June 30. Due to above change. Other Adjustments a) Prior Period Items In the consolidated financial statements for the years ended June 30. such prior period items have been appropriately adjusted in the respective years. 2006 and 2005. Accordingly. 2005 and 2004. there was no impact on the profit of the Company. 2004. Pursuant to recent clarification dated September 5. For the purpose of this statement. appeals etc. the said liability. Material regroupings a) Intangible Assets The provision relating to Intangible Assets as per Accounting Standard 26 on Intangible Assets (‘AS-26’) issued by the ICAI became mandatory for the Company from April 1. 135 . 2003. For the purpose of this statement. 2005. certain items of expenses have been identified as prior period items. which has now been adjusted in the respective years. Accordingly. Accordingly. b) Provision for doubtful debts Debts. 2002. 2006.54 determined based on sales made during the year ended June 30. wherever required. for the year/period ended June 30. e) Tax effect of debentures issue expenses adjusted directly against Share Premium Account The Company had during the year ended March 31. 2004 and March 31. Also. the Company had accounted claims for trade discount of Rs 17. as restated. 2001. as per practice followed. adjustments have been made in the summary statements of consolidated profits and losses. 2004. which were considered doubtful and written off in the year ended June 30. incurred expenses on issue of debentures and write-off of these expenses is being adjusted against the Share Premium Account. the said expense has been appropriately adjusted in the respective year in which sales were made. Consequently. as if it was applicable since then. Accordingly. c) Unspent liabilities written back In the consolidated financial statements for the year ended June 30. on tax effect of expenses adjusted against the reserves. 2006. as restated. 2002 has been adjusted against the Accumulated Profit and Loss balance as at April 1. the amount of above proportionate write-off has now been adjusted net of income tax against the Share Premium Account. the Company had initiated voluntary withdrawal of one of its product. as restated. 4. 2005. income tax (current tax and deferred tax) has been computed on adjustments made as detailed above and has been adjusted in the restated profits and losses for the years/periods ended March 31. 2007. on / after the year end. 2003. 2003.3. June 30. 2006. d) Short / (Excess) provision for tax of earlier years The profit and loss account of some years includes amounts paid/provided for or written back. and 2002. adjustments have been made to the summary statements of consolidated profits and losses. which has been netted off from sales. f) Sales returns During the year ended June 30. 2003. g) Trade discounts During the year ended June 30. 2005 by the ICAI.

00 for the impairment losses representing the amount by which the carrying amount of the asset exceeds its recoverable amount. During the year ended March 31. 1. Sri Sai Home Care Products (P) Ltd. 136 . For the purpose of this statement. 1956. there was no impact on profit of the Company. as issued and required by the ICAI for the first time in preparing the consolidated financial statements for the year ended June 30.43 for diminution in value of investment. Accordingly. the Company has changed the disclosure and claims received in the nature of trade discount were netted off from sales. AS 28 has not been applied for the period/years ended June 30. In accordance with the transitional provisions of AS-28. the Company provided Rs 39. 2004 and 2005. (AS-28)—Impairment of Assets.36 in the equity share capital of Sri Adhikari Brothers Limited (‘SAB’) in year 2000-01. which get eliminated on consolidation. Non-adjustments a) Impairment of assets The Company adopted Accounting Standard 28. The statutory auditors have qualified their opinion on the consolidated financial statements for the year / period ended March 31. adjustments are made to the summary statement of consolidated profits and losses. the Company recorded the accumulated impairment loss of Rs 25. In year 2004-05. that became effective from April 1. 2003. Accordingly. b) Trade discount Upto the year ended March 31. as restated for the year / period ended March 31. 2001. the said depreciation charge pertaining to period prior to April 1. 2005. 5. Notes on adjustments in Consolidated Restated Summary Statements pertaining to Subsidiary Company. the Subsidiary Company had changed the method of providing depreciation on fixed assets from written down value method to straight line method at the rates prescribed in Schedule XIV to the Companies Act. which was not in accordance with the Accounting standard 13. Due to above change. No adjustment has been made in the financial statements for the year ended March 31. 2003 and 2002. Adjustments. Change in Accounting Policies a) Depreciation During the year ended March 31. as the same was not applicable in those years. Financial year ended June 30. II. Such impairment losses were due to adverse market conditions for one of its Cash Generating Unit pertaining to the ‘Soaps and Detergents’ segment. The diminution in the value of investment had not been provided in the accompanying consolidated financial statements. 2002. 6.128) as an adjustment to the general reserves.177. The market value as on March 31.358 was written back during the year ended March 31. 2003 and June 30. the claims received from customers for trade discount was grouped as sales promotion expenses. considering the trend of market value. 2003. the standard has been applied retrospectively. Sri Sai Home Care Products (P) Ltd. Auditor’s Qualifications: A. 2003 The Company had made an investment of Rs 71. have been excluded from the list of adjustments given below. “Accounting for Investments” issued by the ICAI. 2004 and March 31. Listed below are the adjustments which have been made in the restated summary statements of consolidated profits and losses and consolidated assets and liabilities. 2003 was Rs 16. 2001 has been adjusted against brought forward profits as at April 1. Consequently a sum of Rs 4. 2002 in the absence of available information. However for the purpose of regrouping of restated profit and loss and restated assets and liabilities. 2004 and March 31. 2003 pertaining to earlier years and accordingly. to the extent they pertain to the subsidiary company. 2004 on account of non-provision for diminution in value of investment. 2003 and June 30. The management was of the opinion that the investments were strategic and long term in nature and the diminution in the value of investments was temporary.87 (net of deferred tax credit of Rs 13. 2004. the management has provided Rs 60.

54) — — — Prior period item: Trade discount expenses (See note no. .96 Depreciation (See note no.828.51 2. .68 6. note I-3(g) Sales 2007 2006 2005 2004 2003 above) Sale of company’s branded products: a) Manufactured at own facility . . . . . . . whichever is higher. . .36 Short/(Excess) provisions for current tax of earlier years (See note no. 2002. 10. .013. .854. . . . 2. . .63 b) Procured under contract manufacturing arrangements . .653. . .810. . . 2002 and 2003. . 2001. .72 As per audited financials . .805.104. 2001 has been appropriately adjusted to reflect the impact of changes pertaining to prior years till March 31. 1. . . .36 Adjustments: Sales returns pertaining to year 2003-04 (See note no. . . For and upto the year ended March 31. Effective April 1. . . . . . .496. . — 6. 2002. . . . . . .47 3. 212.653. . . the Subsidiary Company had been providing depreciation on its fixed assets on written down value (‘WDV’) method based on the rates specified under Schedule XIV to the Act. . .81 60.496. .01 Sale of other traded products . 207. . . the Subsidiary Company revised its depreciation policy to depreciate its fixed assets based on the estimated useful lives of the fixed assets or at the WDV rates specified in Schedule XIV to the Act. I-3(a) above) . the Accumulated Profit and Loss balance as at April 1. . .00 (80. . . II-1 of Annexure IV) . . . . . . .91 1. . . . as restated (Amount INR Million) Year ended March 31. . . I-3(d) above) . 4.043.019. .14 Profit and loss account as at April 1.30 1. . . Reconciliation of Profit and Loss balance as on April 1. .17 IV. March 31. . .85) — — — Total . . . . . . . . . . . . .11 1.48 2. . . . . — — 80. III. . . . .45 1. .775.943. .828. . . . . . . .33 2. 1. 2001 (Audited) . .00) — — Restated after adjustments . .709. — 17. .85 (6. 2001 (Restated) . . . . Details of Consolidated Sales. — 24. . . . . . .021. 2. June 30. .786. . . .47 3. .00) — — Trade discount for year 2004-05 (See note no. .775. . . . . . . . . June 30. . . . Nine months Fifteen months 2002 ended Year ended Year ended ended Year ended (Refer March 31. I-3(g) above) . . Accordingly. . . . I-3(f) above) . 2001 (Amount INR Million) Profit and loss account as at April 1. . .39 55. . . . . . . the depreciation on fixed assets has been recomputed based on the revised estimated useful lives for the years ended March 31. . . . .95 2. . . . . . . . . .80 703. . . .03 1.72 2. June 30. .59 — 0. .51 2. . .57 1. . . .46 1.863.067. .36 137 .639. .133. . .54 (17. . . .95 2. . . 54. . . . . . .09 2.38 1. . . Further. .44 1.61 (80.21 1. . . . .

. . March 31.068. . March 31. . . . . 72.600.000. . SECURED LOANS 2007 2006 2005 2004 2003 2002 Cash credit from bank * . . . .73 769. . .00 56.23) — — 1. . .462. . . plant and machinery.880 7. . . . — — — (23. .00 95. . .57 72. — — — — 965.75 — 207. . March 31. June 30.00 56. . book debts.57 72. .000 10. . . June 30. . . . . .01 0. March 31. June 30. . . .08 1. . . .00 — 0.600. .000 10.93 1050.293. .00 100. . .38 93. .000. March 31.) . 6. . . . . . .293. . . . . — — — — — 5. .57 34. . . . . . . . . . . March 31. . . .12 1. . . — — — — 1. . UNSECURED LOANS 2007 2006 2005 2004 2003 2002 Deferred sales tax loan .31 Term loan from bank # . 2002 As at As at As at As at As at As at March 31. receivables. . . . . . building and plant and machinery.65 62.75 Less: Debit balance in profit and loss account .57 56. . . . . . 100. . 72. . 1. .66 1. .000 10.36 — — — — — 5. furniture and fixtures and other movable assets. . . .73 1. .79 As at As at As at As at As at As at March 31. . . .37 767. .01 2. . . March 31.59 3.43 69.880 7. . . . . investments and other movable assets * The cash credit from bank is secured against fixed deposits and a first charge on inventory. . . .12 1. .000 Preference share 12 % Redeemable cumulative preference shares . .00 100.816. . . March 31.) .14 2. As at As at As at As at As at As at March 31.500.880 5. . June 30. .73 1.17 0. . . . — — — — — 50. . . . . June 30. . 0.59 286.000 5.V. . .) . . . . . . subscribed and paid-up .01 0. .57 56.00 Number of shares (in Nos. . . June 30. . . .75 607.000 Equity shares Issued. . . .73 993. . . .82 2. .256. — — — 33. Both equity and preference shares are fully paid up 3. . . Schedules to Summary Statement of Consolidated Assets and Liabilities. . . 1.000 9.75 607. .08 2. .01 33. June 30. June 30. . .256.027.099. . .01 0. .75 Balance in profit and loss account . 3. . . . . $ 2 % Fully convertible debentures are secured by second charge by way of hypothecation of land. .00 Number of shares (in Nos. . . . .85 1. .12 120. . . . June 30. . . .000.57 72. . .17 0. .00 Number of shares (in Nos. .068. .256.57 1099. .59 2.33 — — — 138 .65 1.74 1. 388. . . . .293.01 0. . . . 12 % Redeemable cumulative preference shares of Rs 100 each redeemed on March 27. . . as restated (Amount INR Million) As at As at As at As at As at As at March 31. .756. .08 General reserves . . June 30.000. .52 Capital redemption reserve . June 30.00 100. . . . .000 10.256. Face value of equity share is Rs 10 each and preference share is Rs 100 each 2. .000. . RESERVES AND SURPLUS 2007 2006 2005 2004 2003 2002 Share premium . . . 7.880 7. . . .31 # Term loan from bank is secured against first charge on standing crops on land.73 746.02 1. 1. 10. . .60 767. . . . . .85 Investment subsidy .00 2 % Fully convertible debentures $ . .293.01 — — 2.12 1. . . . .57 72. .73 993.000 Total . June 30. . . . . . . .00 100. .57 72. .00 Note: 1. .068. . SHARE CAPITAL 2007 2006 2005 2004 2003 2002 Share capital Equity shares Authorised capital .33 — — — Loan from Director . . . . . . .66 153. . .068. .57 72.59 6.43 67. .

. .54 11. . . Net 2007 2006 2005 2004 2003 2002 a) Deferred tax liability Depreciation .29 6. . . — — — 0. . .27 22. . . .47 4. .23 8. . .13 13. . . . . . . 0. . . 0.71 139 . . . . . . .18 11.82 78. . .69 1. . . .78 8.13 — — Others . . March 31. . . 2003 . . .74 233. . . — — — 1. 1.07 Additions during the year . .74 50. .26 11.47 4. .19 — — Business Loss . . . .52 9. . . 2002 . . .77 4. . . . . . . . . . — — — — — — — 0. . .83 26.05 2.58 2. . . .46 10.23 2. . . . .05 — 0. . .44 — Provision for doubtful advances . . . 6. .34 0.17 Fixed Assets (Amount INR Million) Freehold Leasehold Plant and Dies and Furniture Office Particulars land land Building machinery moulds and fixture equipments Vehicle Total Gross Block as at April 1. . . 22.47 4.37 Provision for doubtful debts . . .83 10.98 11. .06 Net Block as at as at March 31. .45 7. .34 10. . . .23 6. 22. . .12 Charge for the year . 51. . . .91 37. .69 68. . 2003 . 2002 . . .11 10. 13.13 — — — Provision for assets held for disposal . . . . . . .53 13. .90 11.82 8. . . . . .68 37. . . . . . . . . 2001 .23 0. . . . .77 — 56. . . .66 20.09 — — 39. . . . . . . .77 Depreciation Accumulated Depreciation as at April 1. .76 15. . .40 Accumulated Depreciation as at March 31.93 22. . 7.04 b) Deferred tax assets Technical royalty .71 89. — — 14.47 130.22 11.51 291. .92 135. . .22 17.12 Net Block as at March 31.70 4. .96 Gross Block as at March 31.72 0. — — 8.56 122.23 63. . . . . .72 10.34 Adjustments for disposals during the year . .64 1. . 2001 . . . .32 106. . . . . .87 54. . — 0. .19 5. . .46 4. 51. .74 2.82 10. . — 0. — — — — — — — 0.10 362.39 7.65 Charge for the year .50 10. June 30. . .11 Disposals during the year .16 1. 22. . . . . . . . . . .71 7. . .42 5. .23 1.23 Gross Block as at March 31. . . .47 187. . .97 — 1. . . . .57 18. 11. . . . . . . .62 2. .36 4. . . .34 4.91 1.84 413.40 0. 2002 .73 0. .09 49.83 10.27 1. . .15 264. . . . .47 3. .52 40. 2003 . . . .71 11.54 6.65 18. — — 14. . . .27 8. .13 13.66 Disposals during the year . 15.82 78.02 0. . . . . . .36 — — Provision for dimunition in Investments . . . . .69 68. .11 1.75 0.49 Adjustments for disposals during the year . . . . 2002 . . .71 89.23 2.84 413. . . . . . . . . .96 1. .37 260. . . . . . . . . . . .19 5. .74 50.03 12. . . . . . — — — — — — — 0. June 30.83 17.75 5. .55 28. . .98 3. . . .71 11.92 47. March 31.09 11. . . . . .91 109. . . . . . .54 2. . . .19 Additions during the year .99 22. .53 270.76 15.75 0. .49 — 4.64 283.03 52. . . .02 Accumulated Depreciation as at March 31. . . .50 Gratuity . . . . .32 19. .32 19. . .40 1. . DEFERRED TAX LIABILITY. . . 4. 93.95 Freehold Leasehold Plant and Dies and Furniture Office Particulars land land Building machinery moulds and fixture equipments Vehicle Total Gross Block as at April 1. . .44 0.16 58. .27 0. .24 154. . . . Schedules to Summary Statement of Consolidated Assets and Liabilities. .07 Accumulated Depreciation as at April 1. . . . .47 172. . . . . .48 1. .41 681.29 12.24 605. — — — — — — — 1.74 2.41 31.86 10. .75 0. .17 76.04 93. . . . .17 95. .26 — — — Provision for impairment losses . .24 154. .55 7. .09 5. .34 30.96 1. . 0. . . — — 5. . . . . .34 10. . . . 28. .75 5. . . . . . .55 28. . . .23 — 0.V. .75 4. . . as restated—(Continued) (Amount INR Million) As at As at As at As at As at As at March 31. June 30. . . . 2002 . . . .47 187. . .09 49. . . .37 — — Provision for leave encashment . .45 7.42 19. .97 9.

. . . . .10 — — 0.83 4. .48 21. 2004 . . . . . — — — 0. .60 5. . .52 13. . . as restated—(Continued) (Amount INR Million) Freehold Leasehold Plant and Dies and Furniture Office Particulars land land Building machinery moulds and fixture equipments Vehicle Total Gross Block as at April 1. . . 51. . 51. . . .76 101.52 1.80 140 . .67 Adjustments for disposals during the year .34 21. — — — 0.36 4.41 31. . .85 2. . . .53 Gross Block as at June 30th.35 979. . . . — 0. 2005 . .66 209.55 4. . .21 Additions during the year .31 23. .27 6.98 11. .39 34. .59 299. . . .02 21.78 Net Block as at as at June 30. .07 11.40 4. . 0. . .25 23.76 8. 52.85 2.06 6. . .25 293. .35 4. . . .25 32. .64 327.45 7.06 4. — — 44.99 22.87 24. . . .96 Gross Block as at June 30.48 653.64 8. .63 Impairment loss as on 1st July 2004 . 2005 .28 55. . .37 51. .93 22.84 45.45 7. . . 51. . .03 12.60 8.26 18. 51. . .05 — 4. — 0. . . 2004 . .11 779.10 98.10 108. . .61 — 77. . 2003 . 2005 . . — 1. . . . .83 18.48 Disposals during the year .47 — — — 4. . .43 Freehold Leasehold Plant and Dies and Furniture Office Particulars land land Building machinery moulds and fixture equipments Vehicle Total Gross Block as at July 1. .69 403.26 18. .61 5.15 264.59 299. — 0.Schedules to Summary Statement of Consolidated Assets and Liabilities. . . .49 60.93 Net Block as at June 30. . .92 28.12 11. .28 55.06 7. .99 5. — 0. .35 39. .54 1.48 1. . . . .16 0.59 305. .98 205. . .64 327. . .33 3. . . .35 23. .03 14.22 17.63 27. .78 Charge for the year .50 — 0.04 0.09 4.61 5. . .51 22.90 18. .97 Disposals during the year .41 681.52 13. . . . .45 7.91 1.42 13.11 31.73 Depreciation Accumulated Depreciation as at July 1. .63 125.27 3. .92 28.39 34. .18 1.63 27. 2004 . . . . . . . .34 4. . — 1.44 35.76 8. . . .74 4. .14 3. . . .63 125. . . .06 Charge for the year . . .17 76. .28 — — 0.73 9.07 0. . . — 0. .12 1. . . .45 7.37 1. 2004 .77 Additions during the year .21 Depreciation Accumulated Depreciation as at April 1. 2005 . .95 Accumulated Depreciation as at June 30. .00 Adjustments for disposals during the year .64 283.04 — — — 1. .69 769.48 Accumulated Depreciation as at June 30. .31 244. .67 11.43 25.50 1.77 2.35 23.59 404. — 0. . .27 22. 2003 . .11 779.10 344. . — — — 0.26 0. . 52.16 20. .

.59 404.50 — 0. . .26 27. . .99 Additions during the period . 2006 .47 15. . — — — 2.43 25.52 1.26 2. .35 979.40 19.26 0. . . . 2005 . .26 0. . . . .88 7.54 3. .69 403. . .284. . .102.09 6. 2007 . .08 1.71 25. — 0.13 3. .90 12. . .10 52.93 Impairment Impairment as at July 1.98 392. . . .43 4.35 39.21 Depreciation Accumulated Depreciation as at July 1.34 8.32 3. . 2005 .29 7. . . .12 14. — 0. .27 Gross Block as at June 30. . .68 371. . . . 2006 . . . .01 3.35 39.03 14. — — — 0. . . 84. . . . .58 60. . — 0. . . . . — 0. . . . . . .59 467.34 21. .59 9. . .47 15.25 23. . 2007 . . .93 Charge for the year . . . . . 2007 . . . . .39 36.26 0. 2005 .94 — 0.58 60. . — 1.50 — 0. 54. .46 29. . . .20 5. .89 5.72 Accumulated Depreciation as at March 31. . — 0. .52 1.22 12.80 5. . . .10 0.17 — 0. 2006 . . . .06 7. — — — — — — — — — Impairment as at March 31.00 Charge for the period . .34 3.99 Depreciation Accumulated Depreciation as at July 1.30 450. — 1. . .88 26.34 21.23 — 62. .80 255. .84 1. .08 1. . .53 844. . . . 30. .25 101. . . 2006 .79 18. .81 23.64 42.59 467.10 1. . .52 1. . . . . . . .53 Disposals during the year . . .97 11.10 438. .25 32. .61 50.58 38. . .59 9.55 71. . 2007 . .50 Gross Block as at March 31.52 1. .74 10.93 Adjustments for disposals during the year .88 2.00 Net Block as at March 31. .83 121. . . . . .46 1. .88 26. . . .21 4.29 18. . . .29 7. .63 4.00 Charge for the year .17 — 0. .46 29. . . . . . . . . — 1. .58 22. 52.03 14. . . .01 4. . 2006 . . .35 39. . .77 Charge for the period .24 5.46 45. 2. . . .20 219.22 Freehold land Building (Refer Leasehold (Refer Plant and Dies and Furniture Office Particulars Note 1) land Note 2) machinery moulds and fixture equipments Vehicle Total Gross Block as at July 1. .93 1.25 101. . .73 Additions during the year . . . . . . .03 14.88 Adjustments for disposals during the period .31 170. . . . .38 26. . . . 54.04 6.50 — 0. . 54.34 21. . .26 3. .27 989. .79 33. . — — — — — — — — — Impairment as at June 30.35 39. .93 26.72 Disposals during the period .85 514.71 327. . . — 1. .62 20.29 5.35 26. . . .28 141 . .03 14. 2006 .09 24.47 133. .77 Impairment Impairment as at July 1. . . as restated—(Continued) (Amount INR Million) Freehold Leasehold Plant and Dies and Furniture Office Particulars land land Building machinery moulds and fixture equipments Vehicle Total Gross Block as at July 1. . .45 1. — 0. . .102.94 23. .23 — 0.39 36.46 2. .64 20.76 76.20 219. .06 0. — — — 3. .08 2. . . . . .80 5.09 Accumulated Depreciation as at June 30. — — — 8. . .00 Net Block as at June 30. . .16 10.11 31.09 24.Schedules to Summary Statement of Consolidated Assets and Liabilities. .28 56.74 70. .50 — 0. 84. . .17 20.41 1. . .17 1. .93 40. .30 450.93 27. . . . 2006 .49 26.35 3. .55 193.26 0.34 21.08 0.79 33. .87 523.

. . .31 115. . — — 0. . . at cost) 2007 2006 2005 2004 2003 2002 Non Trade Investments (Quoted) Investment in Shares Contech Soft Limited . . . . . . . . . .03 0. .51 0. .86 0. . . . . . . . . .87 Work in progress . . . . . .18 90. . . .46 9. . . . .00) (63. . . . .96 9.85 70. .91 125. . . .51 0. . . .03 72. — — 0. . .26 9. . .67 118. . . .18 Infosys Technologies Ltd . . (63. . . . . . . June 30. .00) — Total . . . .28 101.58 7. June 30. . . . . March 31.18 1. . . — — 0. . . . . . . .71 0. . . . .26 2. . . .32 0. . . . . . 0. . . . . . . . . . . . . .86 Punjab Tractor . . . . .16 23. . . . . . . . .31 0.06 19. . . June 30. 9. .06 6.06 21.60 198. . — — 1. . .13 0. . . . . . . . . . . 10. 145. .96 142 . . 1. June 30. . .19 6. June 30. . . . . . . . . . . . . . . .00) (63.50 against recovery of dues and is held for disposal. . . . . .14 1. . . . . . . .26 2.21 90. . . . .36 MTNL . .26 2. . . .03 26. . (Also refer note under sundry debtors schedule) 2) Includes flats acquired from customer at agreed value of Rs 19. — — — — — 20. . .51 0. .27 National Saving Certificates . .25) (55. .18 1. . . . . . . .39 2.63 NAV of investment in mutual fund . . . . . . as restated—(Continued) Note 1) Includes land acquired from customer at agreed value of Rs 1.87 139. . .65 107.13 0. . . . — — 0. . . .03 0. .03 23. . . . . . .32 Wipro Ltd . . . . . . . . . . .10 3. . . . . . . . . . . .31 0. . . . . . .00 Sub Total . . . . . .54 1. . . . . . . . . . . . . . . . . .00 against recovery of dues and is held for disposal. March 31. . . . .46 193. . .31 Sab Nife Power Ltd . . . . . . .03 9. . . . . . . . . 9. . . . — — 1. . . .13 0. . . . . .31 0. .Schedules to Summary Statement of Consolidated Assets and Liabilities.03 81.25 As at As at As at As at As at As at March 31. . . . . . . . . .36 71. . . March 31. . .16 9. .86 0. . . . . . . . .31 101. June 30. .25 Mphasis-BFL SW Ltd . . . . . .25 9. . . . . . . .18 1.54 1. . . . . . .25) (58. March 31. . . . . . (Amount INR Million) As at As at As at As at As at As at March 31. . .28 81. . . . . . . . 70. . . . . — — 2. . . .85 71.32 0. . .09 1.27 Less: Provision for dimunition in the value of investments .30 Market value of quoted shares .51 Investment in Mutual Fund Unit Trust of India—GSEC .54 1.06 26. . . . . . . . . .09 Satyam Computers Ltd .18 1. . . . .09 1. . INVENTORIES 2007 2006 2005 2004 2003 2002 Raw and packing materials (including goods in-transit) .73 13. . . . . . . .09 1. . . . . . . — — 0. . .27 94. . .33 4. . . . . . . . . 19. . . .07 92. . . . . . .36 71. . .18 1. . . . . . 125. . . .14 Tata Motors Ltd . . . .14 1. . . . . . . .71 Zee Telefilm Ltd . .03 18. . . . . . . . . .71 0. . . . . . . .88 16.86 0. .55 Finished goods (including goods in-transit) . . .14 1. . . .54 Shri Adhikari Brothers Ltd . . . — — — — — 19.78 249. . . . . . . . . .18 44. .08 6. . 72. . . .65 300. . . .03 9. — — 1. . . . . .71 0. . . . . . . . . . . . . .32 0. .36 71.67 25. . INVESTMENTS (Long term. . . . .28 81. . . . . . . .16 18.54 217. . . .89 Stores and spare parts . .28 101. .

83 160. . . . . .36 3. . . . . .82 13. . 2. . March 31.26 86. . . .53 567.91 Advances recoverable in cash or in kind . . . . March 31. . .10 570. . . LOANS AND ADVANCES 2007 2006 2005 2004 2003 2002 Unsecured. .71 322. .55 4. . .61 1. 1. June 30. . . . . . June 30.53 567.78 4. . . . . . . . . Management has filed litigation against the party. (5. . .48 892. .34 0.02 4.14 334. .52 5. .31 0. . . . .28 524.40 31.27 13. . June 30. . (Refer note under fixed assets schedule) As at As at As at As at As at As at March 31. .36 3.33 31. .16 Balance with scheduled banks—Current account . March 31.56 34.26 13. .24 Advance tax (net of provisions) . . . . . .15 5. . . . . . .49 Note : Sundry debtors include receivables of Rs 15. considered good Outstanding for more than six months . . .Schedules to Summary Statement of Consolidated Assets and Liabilities.77 7.22 Unsecured and considered doubtful Advance to suppliers . . . . . . . CASH AND BANK BALANCES 2007 2006 2005 2004 2003 2002 Cash in hand . .25 9. . . (1. — — (30. . .22 — Less: Provision for doubtful debts . . .33) (32. . March 31. .56 — 158. 7. .01 2.52 253.81 106. . .10 260.57 3. .07 from a customer with whom transactions has been discontinued during the year 2005-06.71 629. . SUNDRY DEBTORS (refer note) (refer note) 2005 2004 2003 2002 Secured. . .46) — — 158. . .23 8. . .277.76 47. . . . . .81 106. . .35 4. . . . . . . .58 3. . . . . June 30.194.32 — 0. considered good Deposits . . . as restated—(Continued) (Amount INR Million) As at As at March 31. 5. . . . 13. .05 10. .10 261. .84 108.49 1.78 Considered doubtful .58) (3.81 0.99 10.26 — — — — Unsecured a) Outstanding for more than six months Considered good . . . . . . . .95 81.78) (4. . .22 143 . . . .10 1. June 30.30 Advance to suppliers .33 27. .21 97.66 4. . .65 — — Loans to employees . . . .81 — — Less: Provision for doubtful advances/ loans .22) — 2. . . 17. . . . .49) (1. Of the total outstanding. . . .47 11.32 — 0.92 198. . . June 30. 63.01 281. 9. . .72 17. . March 31. .17 94. 30.28 27. .88 257.75 116. . — — 0.62 752. .97 690. .64 34. . .51 7.77 641. March 31. . . .31) (0. .14 334.95 7. . .01 281.00) — — — 614. .03 Balance with excise authorities .72 —Deposit account . . . 25. . . . As at As at As at As at 2007 2006 June 30.10 260. .67 847.94 2.97 135. . . . . .44 28. 5. . . . . . . . . . . .01 3. . .26 is considered as secured against the market value of land acquired from the customer. .51 4. . . .72 334. . 89. .37 72. . .52 253. . June 30.13 197.69 3. . .92 198. . . . . . June 30. .78 b) Other debts Considered good . .00 — — — Less: Provision for doubtful debts . .34 11. . . .99 144. . . . .13 5. . . . . . . . .54 44. .71 Considered doubtful . . . . . . . . . . . . . . .56 1. . 599. . . .19 2. .13 197.85 6. . . . . . . .44 28.55 11. . . . . . Rs 13. 1. . . . — — 30. . . 614. . . . . . . . . .34 Quantity discount receivable . . .58 186. .47 20. . . .58 186. . .85 261.59 599.27 0. .57 3. . .97 135. . .40 Staff loans .85 As at As at As at As at As at As at March 31. . . . . . .51) (4. .14) (28.

. . . . .89 22.54 1. . . .02 Provision for leave encashment . . .Schedules to Summary Statement of Consolidated Assets and Liabilities. . . . . .11 0. . . . . . . .43 0.14 — Provision for income tax (net of advance tax) .53 — 1.43 0. . . . March 31. March 31. . .73 6. . . . . . . .54 15. . . . .50 11.46 69.75 1. . . .00 — Provision for wealth tax .13 0. March 31. .77 77. . .30 4. . . June 30. . 3. .14 10. — 18. . as restated—(Continued) (Amount INR Million) As at As at As at As at As at As at March 31. . . . . 13. . . . . . . . March 31.01 108. . . . .74 1. . . . . . . . . . 110. . .82 5. . . . CURRENT LIABILITIES 2007 2006 2005 2004 2003 2002 Sundry creditors .48 186. . . .71 198. 15. . 0.96 As at As at As at As at As at As at March 31.15 — — — — — 144 . . . .12 — — — 9. . . . . June 30. . . . . 270. . .36 80. — 2.64 As at As at As at As at As at As at MISCELLANEOUS EXPENDITURE March 31. . June 30.26 3. . . . . .21 12. . . . . . . . . . . . . . . . . . . . . PROVISIONS 2007 2006 2005 2004 2003 2002 Proposed dividend . . . . . . . . . . . .76 Advances from customers . June 30. .93 24.51 18. .62 Provision for fringe benefit tax . . . . . .31 3.27 20.79 — Provision for gratuity . June 30. June 30. . . . (to the extent not written off or adjusted) 2007 2006 2005 2004 2003 2002 Miscellaneous expenditure . . . .88 — 14. . . 35.00 15.50 1. .02 253. . .03 82. . . . . . . . .78 279.06 6. . . .93 40. . . . .47 36.30 59. .97 211. . . .29 240. . .56 Security deposits . . . . . .89 2. . . .03 5.56 25. . . June 30. .72 20. .51 400. 0. . . . . June 30. .80 — — — 50. . . . . . . 0. .15 — — — — — 0.00 — Dividend tax on proposed dividend . . . . — 15. . June 30. . . . . . . . . .07 1. March 31. . . .75 285. March 31. . . . .13 Other current liabilities . . . .96 163. .17 136.76 0. .79 112.

.06 6. . March 31. . net of freight subsidy) . June 30. (125. .32 467. . . . MATERIAL CONSUMED 2007 2006 2005 2004 2003 2002 Raw and packing materials consumed Opening stock . .27 94. .43 3.36 Cost of trading goods Opening stock .53 1. 1. . . .23 Less: Closing stock . . — — — 0. .68 46. . 0.43 — — — Profit on sale of investments .81 121.95 28. June 30. . June 30.79 833.37 1.68 679. . .60 939.72 Nine months Fifteen months ended Year ended Year ended ended Year ended Year ended March 31.03 Less: Closing stock . .17 60.84 1. . . . . . . . . .90 72.24 — 0. . .90 1. . . .425. .40 — — — Profit on sale of fixed assets (net) . . . . .21) (90.07 92.09 0.07 Lease rent income .359.25 3. . .12 0. . . .52) (40.25 8. . .67) (72. .21 90. . . . . (c) 53. .54 484. .37 766. . .02 698. .15 Interest on fixed deposit .48 0. .43 0. .76 Excise Duty .81 579.87) (a) 531.52 — — — — Excess provision written back .47 672.27 Total (A+B) .421.65 1. 26.67 42.10 0. . . . . . . . June 30.81 1.16 — — Sales tax incentives .82 565. — 3.29 924.63 49. . .14 5. March 31. .65) (107. .62 Add: Cost of purchases (including freight. .28 26. . . . .82 0.32 1.55 102. .49 1. .81 8.16 742. . 4. . . . . — 7.61 657. . .07 1. .83 13. .31 1.94 494. . .22 947. .40 Provision for free products under sales promotions scheme . . .60 Export incentives . . .58 — Processing income .55 818. . .29 57.63 3.313. . . . .27) (94. . 61.79 621. . .21) (24.81) (8. — 10. . .447.46 905. .95 21. .68 946.28 723.09 791. .56 758. .67) (42.63) (b) 861. . . OTHER INCOME 2007 2006 2005 2004 2003 2002 Dividend received .57 2.93 — — — — — (A) (a+b+c) 1. . (B) 23. . 1.58 531. 107.27 31. . .20 1.87 84. . . . 8.95 471.453.622. . . .54 0.03 145 .14 462. (96. . . . March 31. as restated (Amount INR Million) Nine months Fifteen months ended Year ended Year ended ended Year ended Year ended March 31. . . . . .79 863. . .50 2.52 40.81 31. .87) (139. . .07) (92.54 1.21 784. Schedules to Summary Statement of Consolidated Profits and Losses.26 37.26 582.66 958.21 24.06 782. . March 31. . June 30.35 Miscellaneous income . . . . . . June 30. . 550. . 72. .81 964. .64 1.66 13. .665. . . . . . .470. .82 1. . — 4. .398. . — — 0. . . . .50 42.43 6.31 — — — Bad debts recovered . . . . . . .80 1.22 652.73 824.VI.37 Add: Cost of purchases .72 528. . . 885. .08 0.87 139. . . .51 — — — — — Credit balances written back .

. . March 31. .33 303.54 (4. . . . .02) (1. .59 5.60 227. . . . .10 4.70 (56.26 Field staff incentives .85 280.08 Staff welfare expenses . .89 78. . . .34 4.34) (0. . . 45. .55 1. 49. .97 186.24 19. . . .58 53. June 30. . PROGRESS 2007 2006 2005 2004 2003 2002 (Increase)/ decrease in inventories Closing stock Finished goods . .57 7. 9.44 11.68 Commission to directors . June 30.16 22. .91 5. . 7. . wages and bonus . . . . . . .00 45. .81 6. . . 216.81 0. .84 9.05 25. . .02 Directors’ remuneration . . . .96 9. . . .16 (52. . . .92 12. . . .89 78. . .50 13. .47 56.25 13.63) (6. .72 344. . .92 1.52 18. . . June 30. . .97 8. .27 Contribution to provident and other funds .27 11. .45 1.24 19.44 19. .45 1.01) (Increase)/ decrease in excise duty Excise duty on closing stock .81 6. . 5. . as restated—(Continued) (Amount INR Million) Nine months Fifteen months (INCREASE)/DECREASE IN ended Year ended Year ended ended Year ended Year ended FINISHED GOODS/WORK IN March 31. . . 3.42 20. . .09 Excise duty on opening stock .10 31. . . . .82 Opening stock Finished goods .91 5. . . .47 56.96 9. .99 33.42 21. . June 30.05 25.57 Gratuity . .58 190. .10 4. EMPLOYEE COSTS 2007 2006 2005 2004 2003 2002 Salaries.75 11.80 14.43 0. . . . . . .23 21.81 (A) (5. . . .55 58. . .61) (5.03 26.51 47. .19) 5. .37 6.99 Work in progress . . 17. . .10 10. . June 30. . . 16. March 31.58 7. . . . .25 13.79 67.10 13.82 53.11) 3. . .18 3. . . 2. .19 15.73 10. . March 31.48 157.43 189. . . . .39 — 6. .48 260. . . .96) (6.19 6. . . . .30 10.43 0. . .44 19. . . .21 146 . . .08 125. . . 20. 10. June 30. . . . .35 5. . .27 Work in progress .19 6. .62 100. .68 16.09) Total (A+B) (4.54 — 5.82 13. .62) (6. .72 13.10) Nine months Fifteen months ended Year ended Year ended ended Year ended Year ended March 31. .10 10. . .79 67. March 31. . .09 — (B) 0. .Schedules to Summary Statement of Consolidated Profits and Losses. .51 47.18 27. . 17. . . . . . . .62 18.

. . . . . . .13 — Carriage outwards (net of freight subsidy) . .09 49. .37 1. . INTEREST AND FINANCE CHARGES 2007 2006 2005 2004 2003 2002 Interest on loans from banks .73 11.70 12.56 Field staff expenses . .07 11. . . . .77 0. .89 — 2. . . . .11 12. . .47 2.71 Bank charges and commission . . . . . 4. .14 7.94 16. . .48 0. . .00 — — Provision for doubtful advances . . .70 —Others .26 11. . . . . . . . . . .15 0. . . . 3. .01 9.65 3.Schedules to Summary Statement of Consolidated Profits and Losses.38 Nine months Fifteen months ended Year ended Year ended ended Year ended Year ended March 31. .51 0.07 10.05 12.98 1.97 27. . 3. . . . . .56 41. . .35 0.55 — — Provision for dimunition in value of investments .76 11. . . .53 1.50 46. .42 41. . . . . . . . . . .81 65. . . . . .50 0. .26 Interest on debentures .24 1. — — — 3. . . . . . . . . . . 29. 2.33 336. . . . .33 56. .09 83.61 429. . as restated—(Continued) (Amount INR Million) Nine months Fifteen months ended Year ended Year ended ended Year ended Year ended March 31. . .75 1.45 10. . .36 31. . .02 24. . .18 0. . . . .66 3.73 Power and fuel expenses . . . . . . . . . . . .67 5.82 2. March 31. . . March 31.34 8. . 5. .51 9.49 Insurance . . .63 15. 2. 0.80 3. — 4. .64 1.33 3. 52. . .29 — 9.18 Directors’ sitting fees .96 Donation . . 1. June 30. . . . . . . . . .36 0. June 30. . . . .97) (35. .45 1. 14. . . . .44 12. . . . . . . . . . . . .80 50. . . . . 51.39 7. . .41 Rates and taxes .55 10. . . net .42 49. . . . . .97 147 . . 0.81 — 3.72 Legal and professional fees . . .41 52. . — — — — 0. . .19 10.33 16. . . .80 1. . .78 329. . . . . .25 17.20 39. .73 10. .79 Printing and stationery . .08 1. .51 1.78 Research and development . . .87 Brokerage on sales . . . . . — — — (0.85 40. . . . . . . . 0. — 0. . . .24 0. 27. 6. . .97 35. . .31 1. . . 48.01 Debenture / Share issue expenses . . 15. . . .59 7. .11 0.94 26.07 9. . . . .21 6. . . . . . . . .67) — Miscellaneous expenses . .96 15.29 0.76 Loss on discarded/sale of fixed assets.13 —Plant and machinery . . .52 13.34 Loss on sale of investments . . . . . .19 16. . 17.04 2.32 Repairs and maintenance —Building . . — — — 0.08 50.46 65. .45 7. .24 0. . .71 1. . 35.47 0. . .38 Rent . . .29 0.28 53. .50 44.25 3. . . 4. . . net .25 — — 0. . . .82 0.25 320.08 21. . . . . .86 2. . June 30.80 20. . . March 31. . . March 31. . . . . . . . — — — 9.67 — Less: Amount adjusted against share premium account .27 3.02 30.33 7. June 30. .76 8. . .77 5.65 9.01 9.90 Traveling and conveyance . . . . — — — 1.09 0. . . . . . . . . . . . 1. . . .27 2.90 25.13 — — — Vehicle maintenance . . .85 — Exchange loss. .42 7.62 271. .44 47. . .70 19. .34 0. . . . . . 7.74 8. OPERATING AND OTHER EXPENSES 2007 2006 2005 2004 2003 2002 Conversion charges . . .99 11. . . . .86 0. . . . .44 25.97 0.13 35.95 8. . . . .75 14. 2. . . . .77 6. . .90 12.59 28.02 — Provision for assets held for disposal . . . . . . . . . . . . .85 420.02 Communication costs . . . . .84 43. . . . . . .24 — — Sundry advances written off . . . . . .77 50. . .24 21. . . . . . June 30. June 30. . . .00 3. . . . .07 1. . .17 19.85 1.

. .Schedules to Summary Statement of Consolidated Profits and Losses. . . .78 21. .P.67 — — — (ii) Tax matters (a) Disputed liability in respect of income-tax demands—matters under appeal . . . . .21 — 54.89 13. .49 (c) Disputed excise duty and service tax demand—matter under appeal . . . . . . . . . . .25 47. 2. . . . . . . . March 31. . . .20 5.85 — — — (iii) Claims against the Company not acknowledged as debt .49 As per our report of even date For S.69 6. . . June 30.99 — (b) Disputed sales tax demands—matters under appeal . . . .17 4. 2007 148 . June 30. . .00 — — 26. . . . . 3. . . . CONTINGENT LIABILITIES 2007 2006 2005 2004 2003 2002 Contingent liabilities not provided for in respect of: (i) Amount outstanding in respect of guarantees given by the Company to banks . . 34. .65 2. . . . .51 0. . . June 30. . . . as restated—(Continued) (Amount INR Million) As at As at As at As at As at As at March 31.65 1. Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M. . . .R. . .00 2. 1. . .36 7. 2007 Place: Mumbai Date: June 6. . . .00 12. .49 6. . . . .66 2. Ramachandran Partner Chairman and Managing Director Membership No: 41870 Place: Mumbai Date: June 6. . . . . .43 1. . . . . . .23 38. 12. March 31.69 9.95 2.80 0.

149 . . .ANNEXURE IVA: Significant Accounting Policies for Consolidated Restated Financial Statements a) Basis of preparation The financial statements of the Group are prepared under the historical cost convention on accrual basis of accounting. . Borrowing costs relating to acquisition of fixed assets which takes substantial period of time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to be put to use. However the carrying value after reversal is not increased beyond the carrying value that would have prevailed by charging usual depreciation if there was no impairment. . . . . . . d) Depreciation Depreciation is provided using the Straight Line Method as per the useful lives of the assets estimated by the management. . . iii. . . . . . . . . . 20 Vehicles . . . . . Although these estimates are based upon management’s best knowledge of current events and actions. 12 Dies and moulds . . . . . . . . . . . . . . . . . after eliminating intra-group balances and the unrealised profits / losses on intra-group transactions. After impairment. An impairment loss is recognized wherever the carrying amount of an asset exceed its recoverable amount The recoverable amount is the greater of the assets net selling price and value in use. . . b) Use of estimates The preparation of financial statements. . . . The consolidated financial statements of the Group have been consolidated on a line-by-line basis by adding together the book values of like items of assets. . . less accumulated depreciation and impairment losses if any. income and expenses. . . . . . . Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use. . . . . A previously recognized impairment loss is increased or reversed depending on changes in circumstances. . . 1-3 Computers . . . . . . . . . . . . . . . . . The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. liabilities. . . . . . . . . . . . . . . . . . . . 20 Furniture and fixtures . . . . . . . . . . . . . 9 Leasehold land is amortised over the period of the lease on a straight-line basis. the estimated future cash flows are discounted to their present value at the weighted average cost of capital. . . . requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the results of operations during the year end. . . and in accordance with the mandatory accounting standards issued by the Institute of Chartered Accountants of India and referred to in Section 211(3C) of the Act and generally accepted accounting principles in India. . . . 6 Office equipments . . ii. in conformity with generally accepted accounting principles. depreciation is provided on the revised carrying amount of the assets over its remaining useful life. . 3-21 Electrical installations . . . . . c) Fixed assets Fixed assets are stated at cost. . . . . . . . . . . . 8-10 Trademarks . . . . The estimated useful life of the assets is as follows: Category Estimated useful life (in years) Buildings . . . . . . . . . . . . . . 30-60 Plant and machinery . . . . . In assessing value in use. . . . . . or at the rates prescribed under schedule XIV of the Companies Act. . . . . . e) Impairment i. . . . . . . . . 1956 whichever is higher. Cost of shares of Co-operative society has been added to the cost of office building. . . . actual results could differ from these estimates.

finished goods. i) Interest in Joint Venture Interest in jointly controlled entities (incorporated joint venture) are accounted for using proportionate consolidation method. m) Foreign currency translation (i) Initial Recognition Foreign currency transactions are recorded in the reporting currency. h) Investment Long term investments are stated at cost.f) Operating Leases Lease payments on operating leases are recognized as expense on a straight-line basis. it is recognized as income over the periods necessary to match them on a systematic basis to the costs. packing materials. Sales Tax and VAT deducted from turnover (gross) is the amount that is included in the amount of turnover (gross) and not the entire amount of liability arised during the year. k) Revenue recognition Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. over the lease term. stores and consumables items are valued at cost or net realizable value. j) Inventories Inventories of raw materials. Where the grant or subsidy relates to an asset. Cost of work in progress and finished goods includes materials and all applicable manufacturing overheads. The Company accrues for excise duty liability in respect of manufactured finished goods/intermediary inventories lying in the factory. by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction. its value is deducted in arriving at the carrying amount of the related asset. Excise Duty. other than temporary. Cost is ascertained on First-in-First out (‘FIFO’) basis and includes all applicable costs incurred in bringing goods to their present location and condition. which it is intended to compensate. work-in-progress. l) Miscellaneous Expenditure Miscellaneous expenditure comprises preliminary expenses for software development expenses for the in-house developed software package. Interest Revenue is recognised on a time proportion basis taking into account the amount outstanding and the rate applicable. Software development expenses are amortised over a period of three years. 150 . where necessary. whichever is lower. Sale of Goods Revenue is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer. When the grant or subsidy relates to an expense item. Provision. is made to recognize a diminution. g) Government grants and subsidies Grants and subsidies from the government are recognized when there is reasonable assurance that the grant/ subsidy will be received and all attaching conditions will be complied with. in the value of investments.

it is probable that an outflow of resources will be required to settle the obligation. The Company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during the period. Contributions to provident fund are charged to the profit and loss account as incurred. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred income taxes reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years. are recognised as income or as expenses in the year in which they arise. 2004 are added to the cost of such assets in line with Old Accounting Standard 11 (1994).(ii) Conversion Foreign currency monetary items are reported using the closing rate. or reported in previous financial statements. p) Sales promotion items Sales promotion items are valued at cost or net realizable value. 151 . in respect of which a reliable estimate can be made. the said asset is created by way of credit to the Profit & Loss Account and shown as MAT Credit Entitlement. and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined. whichever is lower. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. In the year in which the Minimum Alternate tax (MAT) credit becomes eligible to be recognised as an asset in accordance with the recommendations contained in the Guidance Note issued by the ICAI. Provisions are not discounted to its present value and are determined based on best estimate required to settle the obligation at the balance sheet date. If the company has carry forward of unabsorbed depreciation and tax losses. n) Income-tax Tax expense comprises of current. (iii) Exchange Differences Exchange differences arising on the settlement of monetary items or on reporting company’s monetary items at rates different from those at which they were initially recorded during the year. o) Retirement and other employee benefits Retirement benefits to employees comprise payments for gratuity. Unrecognised deferred tax assets of earlier years are re-assessed and recognised to the extent that it has become reasonably certain that future taxable income will be available against which such deferred tax assets can be realised. Exchange differences arising in respect of fixed assets acquired from outside India are capitalized as a part of fixed asset. q) Provisions A provision is recognised when an enterprise has a present obligation as a result of past event. deferred tax assets are recognised only if there is virtual certainty that such deferred tax assets can be realised against future taxable profits. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates. Exchange differences on liability relating to fixed assets acquired within India arising out of transactions entered on or before March 31. leave encashment and provident fund. Current income tax and fringe benefit tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act. deferred and fringe benefit tax. Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction. The liability for gratuity and leave encashment is provided for based on valuation by an independent actuary at the year end. Cost is ascertained on First-in-First out (‘FIFO’) basis and includes all applicable costs incurred in bringing goods to their present location and condition.

Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M.r) Excise duty Excise duty on turnover is reduced from turnover. 2007 Place: Mumbai Date: June 6. s) Goodwill on consolidation The goodwill arising on consolidation has been amortised over a period of five years.R.P. As per our report of even date For S. separately in the Profit and Loss account. Excise duty relating to the difference between the opening stock and closing stock is recognized as income/expense as the case may be. 2007 152 . Ramachandran Partner Chairman and Managing Director Membership No: 41870 Place: Mumbai Date: June 6.

issued by the Institute of Chartered Accountants of India (‘the ICAI’). 2007 and March 31. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.: 41870 Mumbai Date: June 6. 2006. These financial statements are the responsibility of the Company’s management. except that the Company has not presented the information required to be disclosed by Accounting Standard 17 – ‘Segment Reporting’ issued by the ICAI. Our responsibility is to express an opinion on these financial statements based on our audit. 2006. An audit includes examining. as well as evaluating the overall financial statement presentation. 2006. 2.R. We believe that our audit provides a reasonable basis for our opinion. 2007 and March 31. and c) in the case of the cash flow statements. We have audited the accompanying balance sheets of Jyothy Laboratories Limited (‘the Company’) as at March 31. 3. prepared in accordance with the accounting principles generally accepted in India. on a test basis. of the state of affairs of the Company as at March 31. For S. Batliboi & Associates Chartered Accountants Per Sudhir Soni Partner Membership No. These financial statements are prepared solely for use of the information to be given in the Draft Red Herring Prospectus of the Company in connection with the proposed issue of equity shares to the Public and Financial Institutions. which does not have an impact on the profit for the period. Auditors’ Report The Board of Directors JYOTHY LABORATORIES LIMITED 1. 2007 and as at March 31. 2007 153 . The accompanying financial statements have been prepared by the Company in accordance with the requirements of Accounting Standard 25 – ‘Interim Financial Reporting’. An audit also includes assessing the accounting principles used and significant estimates made by management. of the profit for the period ended on March 31. We conducted our audit in accordance with auditing standards generally accepted in India. and are not to be used for any other purpose or referred to in any document or distributed to anyone without our prior written consent. 2007 and March 31. On the basis of the information and according to the explanations given to us. we are of the opinion that the attached financial statements give a true and fair view in conformity with the accounting principles generally accepted in India: a) in the case of the balance sheets. b) in the case of the profit and loss accounts. 2006 and also the profit and loss accounts and the cash flow statements (‘the financial statements’) for the nine months period (‘the period’) ended on those dates annexed thereto. of the cash flows for the period ended on March 31. evidence supporting the amounts and disclosures in the financial statements. 4.

. . . . . . .68 61. . . .16 2. . . .22 Less: CURRENT LIABILITIES AND PROVISIONS Current liabilities .97 2. . . 1 72. . . . . . . .57 72. . .307. . . . .11) Net block . . . . . . . .87 178.08 227.58) (244.39 1.91 236. . . . . .70 833.73) (231. March 31. . . . . . .39 1. . . .381. .90 3. . .29 64.46 27. . . . . . . .90 2. . . . . (280.657. . . . . . . .649. .18 273.18 62.33 1. .225. . .29 1.97 2. . . . .835. .62 291. .10 0. . 4 1.651.31 2. . . . . .651. . . . . . . .01 Unsecured loans .85 808. . . 952. . . . .01 0. 8 290.28 1. . . . .06 INVESTMENTS 7 17.39 137. . .24 441. . . . .77 1. . . . . Bansal Date: June 6.452. . . . . . . .73 2. . . . . . . . . .37 55. 2007 154 . .86 2. . . . . . . . .53 Less: Accumulated depreciation and impairment .01 61. . . . . . . . . . . . . . . . . 21 The schedules referred to above and notes to accounts form an integral part of the financial statements. . . . . . .06 26. .42 2. . .34 DEFERRED TAX LIABILITY. . . . . . .57 Reserves and surplus . . .10 Cash and bank balances .534. . . . 2007 AND MARCH 31. . . . . . .58 180. 9 629. . . . . . . .58 1. . . .34 2. .05 891. . .42) (197. . . June 30. . .04 2. . . . . . . . . . . . . . . . . . . . . . .500.039. . . . .06 CURRENT ASSETS. . . 13 49. . .23 1. 10 689. .820. . . . . . . .85 Loans and advances . .64 1.92 956. . . . . . . .34 LOAN FUNDS Secured loans . . June 30. . . . . .90 2. . . . . . . . . . . . . .378. .50 759. . . . . .461. . . . . .90 35. . . . .86 2. . . . . . . 11 207. 5 58. . . . .16 909. . . . . .94 229. .152. . . .17 1. . . . . . .59 Other current assets—Sales promotion items . . . . .252. . . . . .583. . .09 0. . .02 243. .252. . .48 334. . . . . . . . . . As per our report of even date For S. .11 40.10 1. . . .64 845.763. . . . .38 Provisions . . .20 1.46 75. . SCHEDULE 2007 2006 2006 2005 SOURCES OF FUNDS SHAREHOLDERS’ FUNDS Share capital . . . . 1. . .57 240. . BALANCE SHEET AS AT MARCH 31.948.77 2. . . . . . . . . . . . . . . . . . .85 2. 3 0. . . . . . .L. .760. . . 547. .57 72.42 Capital work-in-progress (including capital advances) . 1. . . 2006 (all amounts in millions of Indian Rupees) As at As at As at As at March 31.08 308. 2 2. . . . .895. .60 2. . . . . . .72 APPLICATION OF FUNDS FIXED ASSETS 6 Gross block . . .068. . . . . . . . . . . . . . Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M. .525.67 1. .71 294. . . .31 17. . . . . .62 NET CURRENT ASSETS . 2007 Deputy Managing Director Company Secretary Place: Mumbai Date: June 6. . . . .66 1. 2. .277. . . .25 4. . . .46 57. . . .583. . . . . . 12 391. . LOANS AND ADVANCES Inventories . .72 Notes to accounts . .233. . . . . . Ramachandran Partner Chairman and Managing Director Membership No. .88 334. .078.R. . . . . . . .39 Sundry debtors . . . .14 85. . . .85 2.P. . . . . . . . .14 872. . NET . . . . . .01 0. . .06 19. Ullas Kamath M. . . .01 1. . . .57 72. . . . . . .895.19 267. . . . . . . . . . . . .77 2. . . .: 41870 Place: Mumbai K. . . . .

. . . . . . . . . . . . .17 PROFIT AVAILABLE FOR APPROPRIATION 485. . . 15 1. . . . . . . . . .54 pertaining to previous year sales) . . . . . . . . . . . .295. . . . . . . . . . . . . . . . . 2007 Deputy Managing Director Company Secretary Place: Mumbai Date: June 6. . . . . . . . . . . . Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M. . . . . . — 6. . . . . . . . . . . . . . . . . . . . . . . . . .Deferred tax charge .381. . . . . . . . (173. . . 21 The schedules referred to above and notes to accounts form an integral part of the financial statements. . . . . . . . . . . . . . . . . . . . . . . (58. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 445. . . . . . . . . . . . .51 PROFIT BEFORE PRIOR PERIOD ITEM AND TAX . . . . . . . . . . . . . . 445. . . . . .85 PROFIT BEFORE TAX .80 95. . .19) Net sales . . . 6 42. . . . . end of the period 403. . .L. . 19 2. . . . . . . . .50 .01 2. . . . . . . . . . . . . . . . . . .81 96. . . . . . . . . . . beginning of the period 92. . . . . . .Wealth tax . . . . . . . . . .P. . . . . . . . .42 Employee costs . . . 0. . . . . . . . . . . . . . . . . . . . .06 306. . . . . . . .12 402. . . . . 1. . . . . . . . . . . . . . . . . . . . .07 1. 10. . . . .18 — PROFIT AND LOSS ACCOUNT. . . . . . 18 600. . . . . . . . . . . . . . .35 Depreciation . . . . . . . . . . . . .45 36. . . . . . . . . . . . . .20 . . .Current tax . . . . . . .983. . . . SCHEDULE 2007 2006 INCOME Sales (gross) . . . . . . . . . . . . . . . . . . . . . . . . . . .08 28. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 28. . . . . . . . . . . . . . .79 Prior period item—Advertisement expenses . . . .44 Provision for tax . . . . . . . .879. . . . . . .30 EXPENDITURE Material costs . . . . . . .433.880 Notes to accounts . . . . 393. . .16 42. .Fringe benefit tax . . .62) (10. . . . . . . . . . Ullas Kamath M. . . .10 2. . . . . . . . . . . . . . . . . . . .42 . . . . . . . . 2007 AND MARCH 31. . . . . . . . March 31.32 PROFIT AFTER TAX . . .07 1. . . . . . . . . . . . . . . . . . . . . . . . . . 72. . . . . . . . . . . .56 2. .00 PROFIT AND LOSS ACCOUNT. .42 397. . . . . . As per our report of even date For S. . . . . . . . . . . . . . . . . . . . . . . . 2006 to 2005 to March 31. 16 (9. . 17 296. . . . . . . . . . .30) Excise duty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17 Nominal value per share (Rs) . . . . . . . . . . . . . . Ramachandran Partner Chairman and Managing Director Membership No. . . . . . . . 2006—Rs 17. . . . . . . . . . . 2. . .100. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .00 23. . . .R. . . . . . . . . . . .35 2. . . . .28 0. . . . . . . .46 Less: Sales tax recovered . . . . .285. . . . . . . July 1.73 1. . .17 EARNINGS PER SHARE (EPS) Basic and Diluted (Rs) . . . . . . . . . . . . .75) (151. . . . . . . . . . . . . . . . . .256. . . . . . . . . . . . . 14 102.57 — Dividend tax on interim dividend . . . . . . . . 7. . . . . . . .15 2. . . . . .57 (Increase)/ decrease in inventories . . . 3. . .57 245. . . . . .92 592. . . . . . 54. . . . . . . . .96) Less: Trade discount (includes Rs Nil. . .87 402. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .74 Other income . . . . . . . . . . . . . . 10 10 Weighted average number of shares outstanding for calculation of Basic and Diluted EPS . . . . . . . . . . . . . . . . . . . . .42 362. . . .880 7. . . . . . . . . .478. . . .17 APPROPRIATIONS: Interim dividend to equity shareholders . . . . . . . . . . . . . . . . . . .50 Prior period item—Trade discount expenses . .776.27 18. . . . . . . . .12 Other expenses . . . . . . . . . . . 23. . . . . . . Bansal Date: June 6. 7. .34 Interest and finance charges . . . . . . . . .00 4. . . . . . . . . . . . . .70) (319. . . . . . . (286. .256. . STATEMENT OF PROFIT AND LOSS ACCOUNT FOR THE NINE MONTHS PERIOD ENDED MARCH 31. . . . . . .797. . . . . . . . . . . . . . . . . . . . 44. . . . . . . . .: 41870 Place: Mumbai K. . . . . . . . 2006 (all amounts in millions of Indian Rupees) July 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2007 155 .57) Less: Excise duty recovered . . . . . . . . . . . . . . . . . . .30) (40. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . 0. . . . . . . . . . . . . (61. . . . . . . . . . . . . . March 31. . . . . . .34 Net increase / (decrease) in cash and cash equivalents (A+B+C) . . . . . . . . . . . . . . . . . . . . . . . . .44 Adjustments for: Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .72 Increase in current liabilities / provisions . . . . . . . . . . . . . . . . . . . . . . . . (639. . . . . . . . . . . . . . . . . . (64. . . . . .59 Cash and cash equivalents at end of period . . . . . . . . . .76) (76. . . . . . . . . . . (105. . . . . . . . . . . . . . . . . . . . . . . . . . . .08 0. . (54. . . . . . . . . . . . . . . . — 3. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0. .07) (1. . . . . . . . . .01 Interest income . . . . . . . . . . . . . . . . . . . . . net . . . . . . . . .30 Provision for dimunition in the value of investments .94 B. . . . . . . . . . . . . . . . . . . . . . . .42) 2. .08 Deferred sales tax loans . . . . . . . . . . . . . . . . . . . . . .54) (64. . . . CASH FLOWS PROVIDED BY/(USED IN) INVESTING ACTIVITIES: Purchase of fixed assets (including capital work-in-progress and capital advances) . . . . (67. . .05 156 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .80) Net cash generated from operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .66) 71. . . . . . . . . . . . . . . . . . . . . . . . . 93. . . . . . . . . . . . . . . . . . . . 689. .94 1. .277. . . .53 67. . . . . . . . . . . . . . . . . . . . . . . . . . . 2006 to 2005 to March 31. . . . . . . . . . . . . . . . . . . . . .08) (67. . . . . . . . . 61. . . . . . . . . .10) Receipt of investment subsidy . . . . . . . . . . .74 Taxes paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2007 2006 A. . . . . . . . . . . . . . STATEMENT OF CASH FLOWS FOR THE NINE MONTHS PERIOD ENDED MARCH 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (335. .65) Trade receivables . 2. . . . . . . . . . . . . . . . . CASH FLOWS PROVIDED BY/(USED IN) OPERATING ACTIVITIES: Net profit before taxation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 75. . . . . . . . . . . . . .08) (0. . . . . . . . . . .42) Credit balances written back . . . . . . . . . . . . . . . . . . . . . . .81 — Provision for doubtful debts . . . . . . (12. . . . . . . . . .98 410. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23 891. . . .25) (43. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .84 Cash generated from operations . . (588. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .67 1. . . . . . . . . . . . . . . . . . . . .61 Bad debts written off (net of provision) . . . . . . . . . — 13. . . . . . . . . . 0. . .49 0. . . . . July 1. . . . . . . . . . . . . . . . . . . . . . . .42 362. . . . . . . . .07 (Increase) /Decrease in current assets. . . . . . . — 61. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42. . . . . . . . . . . . . . . . . . . . . . . — (10. . . . . . . . . . . . . . (0. CASH FLOWS PROVIDED BY/(USED IN) FINANCING ACTIVITIES: Borrowing / (Repayment) of loan fund . 0. . . . . . . . . . . . . . .55 408. . . . . . . . . . . . .13) 415. . . . . . . — 4. . . . . . . . . . . 2006 (all amounts in millions of Indian Rupees) July 1. . . . . .00 Provision for doubtful advances . . . . . . . . . . . . .25) — Proceeds from sale of investments . . . . . . . . . . (576. . . . .45 36. . . . . . . . . . . . . . . . . . . . . . 157. . . . . . . .71) (10. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18 C. . . . . 2007 AND MARCH 31. . . . . . . . . . . . . . . . . . . . . . . . . . . .89 50. . . . .01) Dividend paid . . . . . . . . . . . . . . . . . . . . 445. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24) Loans and advances . . . . . . . . . — 0. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30 364. . . . . . .96) Dividend received . . . . — (3. . . . . . . . . . . . . . . . . . . . . . . . .88) Dividend tax paid . . . . . . . . . . . . . . — (6. . . . . . . . . . . . .72) (1. 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27) Sundry advances written off (net of provision) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2. . . . . (90. (0.01) 48. . . . . . 2. . .88 Purchase of investments . . . . . .09) Interest expense . . . . . . . 435.53 Interest received . . . . . . . . . . . 179. . . . . . . .10 1. . . . . . . . . . . . . . . . . . . . .89) (50. . . . . . . . . . . . . . . . . . . .78) Excess provision written back . . . . loans and advances Inventories (including sales promotion items) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .00 Proceeds from sale of fixed assets . . . . . . . . .307. .53) Net cash provided by / (used in) financing activities . . . . . . . . . . . . . . . . 4. . . . . . . . . . . . . .43 Profit on sale of investment .53 0. . . . . .34 Loss on discarded/sale of fixed assets. . . . . . . . . . . . . . . . . . . . . . . . . . . .78 Dividend received . . . . . .46 Operating profit before working capital changes . . . . . . . . . . . . . . . .68 Interest paid . . . .09 Net cash provided by / (used in) investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . .46 Cash and cash equivalents at beginning of period . . . .07 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . .P. . . . . . 2007 K. . . . . . . . . . . . . . . 2007 157 . . . . . . . . .09 1. . . . . . . . . . . . 599. 1. . . . . 89. STATEMENT OF CASH FLOWS FOR THE NINE MONTHS PERIOD ENDED MARCH 31. . . . . . . Ullas Kamath M. . .10 1. .L. . Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M. . .79 —Deposit account* .05 * Includes deposits provided as securities against bank guarantees—Rs 4. . . . . . . . . 2006 (Amount INR Million) July 1. . .00 49. Ramachandran Partner Chairman and Managing Director Membership No. . . . . .R. . .18 (2006—Rs 3. . 2006 to July 1. . .99) As per our report of even date For S. . .307. . . .21 Balance with scheduled banks—Current account . . . . 2007 AND MARCH 31.256.01 1. . . Bansal Deputy Managing Director Company Secretary Place: Mumbai Date: June 6. . 2007 March 31. . . . . 2005 to March 31. . . . . . . .: 41870 Place: Mumbai Date: June 6. . 2006 Components of cash and cash equivalents Cash in hand . .05 689. .

. . . beginning of the year/ period . . . .00 100. . .14 Balance in profit and loss account . . . . . . . 1. . . . 6. . . . . . . . . . . 0. . . . . .44 3. . . . — — — (25. . . .64 Provision for doubtful advances .39 7. . . .14 988. . . . 2006 (Amount INR Million) As at As at As at As at March 31. . . . . .08 — Term loan from bank# .00 100. . .57 72. . . . . . . . .85 2. . . . . . . . .000 equity shares of Rs 10 each . . . . . .256. . . . . . . . . . . . . .01 0. . . . .31 1. . .87) Balance. . .00 ISSUED. . . .64 2. . . 1. . . . . . . . . . . . . . . .04 27.46 57. .57 72. . .152. .11 3.33 SCHEDULE 5 DEFERRED TAX LIABILITY.59 6.13 Others . . . . . 403. . . . . beginning of the year/ period . . . . .15 3.14 73. March 31. . . 72.00 100. .09 0. . .17 1.065. . . . . .461. . .32 1. . . . . . . . . . . . . . . . . . . . .15 2. . . . — 3. . . . . .15 3. . .17 2.59 6.065. .288. . . . . . . .17 96. . . . . . . . . . .01 61. .44 0. . . . . . . .50 84. .08 Add: Subsidy received during the year/ period .14 988. . . . . . . . . .44 84. .07 Balance. . .14 73. .15 General reserves Balance. . . . . . Net a) Deferred tax liability Depreciation 90. .31 1. . . .59 3. . . . . .01 0. . . . . . . . . . . . .91 1. . . . . . . . . . . . .43 Provision for doubtful debts . . . . . . . .60 58. . . . .57 72. . . .01 * The cash credit from bank is secured against fixed deposits # Term loan from bank is secured against first charge on standing crops on land. . .57 8. . . . . .07 28. . .31 Investment subsidy Balance. . . . . . . . . .77 2. . . .31 1. . . . . . . . . . .57 72.00 100. . . . . . . . . . . . . . . . . . . .14 988. . . . . . . . . . . . . .57 72. .452.01 0. . . . . . . . . . . . .68 46.01 0. . . . . . June 30. . . . . .065. . . . . . . investments and other movable assets SCHEDULE 4 UNSECURED LOAN Deferred sales tax loan . . . . . . . .17 1. . .00 Less: Impairment loss . . .58 2. . . . 1. . . — — — — 0. . . . . .00 — 250. . . . . . . . . . . . . .16 2. . . .64 b) Deferred tax assets Technical royalty . . . . . . .73 11. . . . . . . . . . . . . 13. .47 10. . . 2007 2006 2006 2005 SCHEDULE 1 SHARE CAPITAL AUTHORISED CAPITAL 10. . . . . . . . .880 equity shares of Rs 10 each .01 0. . . . . . . . . . . . . . . . . . . . .23 1. . .37 55.00 100. June 30. end of the year/ period . . . . . . .01 Accrued Interest . . .33 1.77 SCHEDULE 3 SECURED LOANS Cash credit from bank* . . .13 — 13. . . . . . . . receivables. . . 1. . . . . . . Schedules Forming Part of the Balance Sheet as at March 31.46 27.00 100. . .57 72. . . . . . . . . .12 92. . . . . . — — 13. . . . . . .81 402.00 100. . .64 90. . . . . . 6. end of the year/ period . . . . . . . .44 84. . . . 11. . .05 Gratuity . . . . . . . . .46 1. . . . . . . . . . . . . . . . . . .04 158 . . — — 61. . . .14 1. . . . . . .26 Provision for impairment losses . . . . 0. . .065. . . . .000. .14 988. . . .288. . . . . . . . . . . . . . .01 Add: Transfer from profit and loss account . 2007 and March 31. . .763. . . . . . . .00 1. . . .13 13. . . . . . . . . . . . . . . . . .26 0. . . . . . .50 84. .57 SCHEDULE 2 RESERVES AND SURPLUS Share premium . . . . . .66 1. . 1. .13 0. . . . . . . . . . .27 32. .57 72. . . . . . . . . .75 8. . . . .01 0. . . .14 764. . . . . . . . . . . . — 300. . 4. . . . .288.66 1. SUBSCRIBED AND PAID UP CAPITAL 7. . . . . 0. . . . .82 Provision for leave encashment . . . 100. .54 1.

. . . . .18 53. .79 159 Total .33 4. 418. .60 14. . 14. .59 388.11 5. .42 — — — 0. . . .17 25. .29 30. .23 38.10 40. . . . . . . . . . . For the March 31. June 30. . .98 Building# . . .65 0.50 4. . . . .19 2. . . . 2007 and March 31. 28. . . 1. . .64 21.45 6. . . . . . . . 2006 SCHEDULE 6—FIXED ASSETS (Amount INR Million) Gross Block Depreciation and Amortisation Impairment Net Block As at As at As at As at As at As at As at As at July 1. .50 — 21.83 1.93 19. .00 833. .50 against recovery of dues and is held for disposal. . . . .29 Leasehold land . .02 15.12 3. . 7.95 2. . . .70 833. .31 — 6. . . . .26 19. . .68 Plant and machinery .58 0.32 1. .00 20. . . .54 — 27. . . . . .59 20. Particulars 2006 Additions Deletions 2007 2006 period Deletions 2007 2006 period 2007 2007 2006 Freehold land* . . .26 1. . . .26 — 1. . .03 — 1.85 As at June 30.88 0. . .76 2. 36. . . . . . .58 166.35 — 0. . . .00 — 39.16 10. 462.03 26. . . . . . .71 1. . . . . . .41 9. . .72 4. . . . . . . .55 Trademarks . .85 * Includes land acquired from customer at agreed value of Rs 1.64 — 84. . . . .66 5.79 0. . .00 against recovery of dues and is held for disposal. . . .29 — 27. . . . .09 5.04 11. . . .17 24. . .71 459. .52 20. . . . . .03 4.64 0. .26 Office equipments . . . .20 — 5. . . . . . .31 103.91 12. . . 2006 . . For the March 31.10 205. .078. . . .34 — 14.11 51. . . .28 205. . March 31. . . . . . . . . . .42 0. .59 9. . . . . . (Also refer note under schedule 9) # Includes flats acquired from customer at agreed value of Rs 19.17 85. 33. .31 10. .34 431. July 1.67 0.27 23.34 1.93 54. .73 42. . . . . .55 0.91 — — — 8. . . . . .26 2. .50 — — 14. . July 1. .233. . .03 311. . . . . . .35 26. . . . . .60 241. . .73 39. .078. 956. . . . . . .58 39.08 18.35 — 515. .84 7. . . . .49 3. .00 952. . . . . . .53 132.74 1. . .50 334.52 — 0. .04 48. . . . .44 — 69. 54. . Schedules Forming Part of the Balance Sheet as at March 31. .16 — 0.06 Furniture and fixtures .45 3. . .00 — 39. . 24. . . . . . . . . March 31.58 158.18 26. . . . . . . . . . . . . . . . . .70 Vehicles . . .54 Dies and moulds . .53 59. . .21 1.93 — — — — — — — 84. .49 18. .

. . .80 340. . . . . . . . . .00 759. .59 — — 7. .03 6. 2006 2005 period Deletions 2006 2005 period 2006 2006 2005 Freehold land* . . . 372.00 808.50 Furniture and fixtures . .039. . . .89 11. . . . . . . . . . .14 15. .78 0. .69 Office equipments .50 310. .35 — 0.17 — 24. . .84 8. . . .89 12. . . . . . . .16 3. . . .53 88. .11 36. . .06 2. . .67 Dies and moulds . . .60 5. . . . . . . .06 Leasehold land . 52.06 160 Total . . .10 1. . .46 0. . . .39 — 27.93 0. 2007 and March 31. . .61 22. . . . .47 158. . .18 — 54. . 2006 SCHEDULE 6—FIXED ASSETS (Amount INR Million) Gross Block Depreciation and Amortisation Impairment Net Block As at As at As at As at As at As at As at As at July 1.06 — 0. . . . . . . . .97 0. . . . .92 158.04 6. .10 Building . . . .69 62. .07 — — — 2. .02 — 25. 2005 .42 As at June 30.26 17. . 956. . . . . . .26 — 1.18 0.74 8. 31. . March 31. .10 2. . . . . . 22. . . . . .39 21. . . . . . . . . . . .24 — — — — — — — 54. . . . . .21 1. . . . .35 6. . . .00 against recovery of dues and is held for disposal (Also refer note under schedule 9) .20 — — 14. . . . . . .24 52.11 — 39.50 759. . .50 — 21.80 288.03 192. . . For the March 31. . .69 Trademarks . . . . .32 14.59 0. . . . . .05 2. .53 18.00 39. .08 0.31 — — — 9. .42 39. .99 1. .26 Vehicles .78 1.34 — 14.57 31.35 23.39 Plant and machinery .52 18.83 32. 754. Schedules Forming Part of the Balance Sheet as at March 31. . .31 1. . . . . . . .23 35. . . . 399. .46 44. . . .15 411. . . . . . .26 19. . . . . .42 39.52 1. .38 205.89 — 431.84 9. . March July 1. . . 14.42 * Freehold land acquired in current year from customer at agreed value of Rs 1. . 24. . . . . . . . . .33 0. . . . . . .34 362. . . . . . . . 31.88 1. . . . . 7.71 18. . . . . . .42 0. .48 — 54. . . . . . . . . . . . For the March 31. . .52 — 0. June 30. . . . .14 1. . . July 1.22 4.03 — 1. . . . . . .00 — 39. .34 2. . .50 44.20 3. Particulars 2005 Additions Deletions 31. . .05 79. . . . .95 956.79 4. . .95 23.15 — 4.27 2. . . . . . . . . . .17 — 4.31 2. . . . . . .56 3. . . .53 114. . .

. . . . . .61 99. . . . . . . . . . . .06 19. . . . . .71 Zee Telefilm Ltd . . . . . . . . . 72. . . . . . . . . . . . . . . . .039. . . . . . . . . . . . . . 9. . .37 MTNL . . .03 81. . . . . .58 180. . . . . . . . . .500 1. . .28 8. . . . . . . . . . 146. . . .23. . . . . . . . . . 2007—Rs 70. 2007 and March 31. .26 Mphasis-BFL SW Ltd . . . . . .91 236. SCHEDULE 8 INVENTORIES Raw and packing materials (including goods in-transit as at March 31. . . . . . . . . . . . . . . . . . . . . . . . 10 2. .03 72. .52 8. . . . . . . . . . . . . . . . . . . . . . . — — — — National Saving Certificates . . . .00) (63. . . . . . . . . . . .18 1. . . . . . . . . . . . Schedules Forming Part of the Balance Sheet as at March 31. . . . . .03 Indira Vikas Patra . .32 Wipro Ltd . (63. 2006 (Amount INR Million) Face As at As at As at As at Value Number of March 31. .25 — — — Non Trade Investments (Quoted) Investment in Shares Contech Soft Limited . 10 27. . . .18 1.13 0. .31 17. . . . . . . 10 27. . . . . . .46 9. . . . .14 Tata Motors Ltd .82 8. . . . 115. . . 10 25. 10 1. . .13 0. . .31 Sab Nife Power Ltd . . . . .27 Less: Provision for dimunition in the value of investments . . . . . . . as at March 31. .03 9. . .39 161 . .86 Punjab Tractor . . 2 658.06 26. . . . . . . . . . . .194 70. . . . . . . . 5 400 — — — 0. . . . .73 # The Company has an investment as at March 31. . . . . . . . . . . . . . .550 7. . . .08 Satyam Computers Ltd .25 98. . . .17 19. . .02 243. 19. .85 16. .27 120. . . . . . . . . . . . . . . . 10. . . . . . . .42 Work in progress . . .49) . . . . .500 — — — 1.04) . . . . . .18 1. . . . . June 30. . . . . . . .85 71. . . . . . . . . . . . . . . . . . . 1 2. . . .000 — — — 0. . . . 0. .18 Infosys Technologies Ltd . . March 31. . . . . . . 2006—Rs 70. . .500 — — — 1. . .06 Market value of quoted shares . .24) Total . . . . as at March 31. . . . . . . .03 72.85) in the equity shares of Shri Adhikari Brothers Limited (SAB). (Rs) Shares 2007 2006 2006 2005 SCHEDULE 7 INVESTMENTS (Long term. . . . . .34 7. . . . . . . . 2006— Rs 0. .06 10.00) (61. . . . . . . . .54 Shri Adhikari Brothers Ltd # . . 2006—Rs 10. . 9. .90 7. .85 70. . . .72 290. . . . . . . . . . . . . .13 0. . June 30. . . . . . . . . . . . . . 2007—Rs 24. 10 3. . . . . . . . . . . . .000 — — — 2. . . . . . . . .90 7. . . . on evaluation of its investment in SAB. . . . . . . . . . . . The management has in past considered this investment as strategic and long term in nature. . . . . . . . . . . . .85 70. .04). . . . . . . . . . . . the management had recognised the dimunition in value to be other than temporary and has provided Rs 60. . . . . . 10 5. . . .22 15. . . . . . . . . . . . . . . .43. . . . . . . . . . . . . 2 500 — — — 0. . . . . . . . . . . . . . . . . . . . . . .50 Sub Total . . . . . . . . . . .11 113. .00) (63. . . . .03 11. . . . . . .04. . .03 18. . . 2007—Rs 1. . . . . . . . . . . . . .13 17. . . . .90 7. . . . . .00. . . . . 2 300 — — — 0. . 10 8. . . .53 82. . . . . . 2006—Rs 11. . . as at March 31. . . . . . . . .78 Stores and spare parts . . . . . . .000 — — — 0. .000 0. . . . . . . . . . . The market value of SAB over past few years has been substantially lower (as at March 31. . . .85 (as at March 31. . .71 80. . . . . . . . . .90 Limited—a wholly owned subsidiary Investment in Balaji Telebrands Limited—a Joint venture company . . During the previous year. . . . . . . . . . . . . . . . . . .47 Finished goods (including goods in-transit as at March 31. . . . . at cost) Trade Investments (Unquoted) Investment in Sri Sai Home Care Products Private . . . . .000 — — — 1. 2007 the market value was Rs 10. . .

87 22. . . . .71 294. . . . . . 2007— Rs 13. . . . . . . . 2003.98 11. . . . considered good Advances to wholly owned subsidiary . . . . . . .26) is considered as secured against the market value of land acquired from the customer. .15 4.10 Considered doubtful . 57. . . . .78) (2. . .69 43. . . 6. .63 Quantity discount receivable . . . . . . . .31 0. . . . .57 240.44 1.96 207. . . .40 20. . . . . . . . .39 137. . 14. 89. . . 30. . . . . .04 12. . . .67 Balance with excise authorities . . 1. . . 4. . .10 1. . . . . . . . . . . . . . . .12 35. . Management has filed litigation against the party.10 * Sundry debtors include receivables as at March 31. . . 62. . . . . . . . . . . . .16 Advance tax (net of provisions) . . . . . . . . . . . . . . . . .41 319.26 (as at March 31. . . .58) 2. . . . .01 279. . . . . . . . . . . . . 2007—Rs 15. . . . .256. . . . . . . .48 334. . . . . . . . .00 81. .18 Advances recoverable in cash or in kind . . 1. . . . June 30. .81 2. . . . Of the total outstanding. . 21. . . . . . . . . . .44 1. . June 30. . . .21 0. (1. . . .51) (4. . . . . . . . . considered good Outstanding for more than six months* . . 2006—Rs 15.31) (0. . . . . . (5. .14) 207. . .10 17. .76 Staff loans . . . .277.92 Balance with scheduled banks—Current account .17 1. . . . . . . . . . . . . .39 137.42 per share on October 1. . .28 4. . . . . . .87 178. . 2006 (Amount INR Million) As at As at As at As at March 31.52 5. . . . . . . .88 334.23 1. .26 13. . . . . . . .44 — Considered doubtful . . . . . . . . . . Schedules Forming Part of the Balance Sheet as at March 31. . . . .44 — b) Other debts. . . . . . . . . . . . . . . . . . .10 629. . . . . . . . . . .98 (as at March 31. 354. . .69 47.59 * Deposit includes as at March 31.09 1. . . . .00) 614. . . . March 31. . .29 Unsecured and considered doubtful Advance to suppliers . . .02 10. . . . . . . . . . . . . .05 Advance to suppliers (refer note 6 in schedule 21) . . . . .87 178. . . .17 4. . . . . . . . . . . . . . . . .53 35.29 162 . . . . . .01 1.00 Less: Provision for doubtful debts . . . . . . . 13. . .29 689. . .07) from a customer with whom transactions has been discontinued. . .307.18 334. . . . . . . . . . . . . .38) (32. . . .57 240. . . . . . . . . . 599. . . . . . . .33 4. . . . . .26 13. . 2006—Rs 13. .88 Deposits . . . . . . . . . 614. . .26 — Unsecured a) Outstanding for more than six months Considered good* . . . . . . . . . .81 2. . . . . . . . . . . . . as at March 31. . . . . . . . . . .41 319. . . . . . . . — — — 30.880 equity shares of Rs 10 each at a premium of Rs 572. .656. . — — — 0. . . . . . . . . . . . . . . . . .17) (4. . . . . . . . . . . . . . . . . . .13 5. . . . .68 1. . . . . . . . . .18 9. . . . . . . . . .01 279. .38 49. . . .95 4. . .05 5. . . . . . . . . 2. . . . . . .51 4. . (Refer note under schedule 6) SCHEDULE 10 CASH AND BANK BALANCES Cash in hand . . .09 4. . .58 Less: Provision for doubtful debts . . . .38 31. . . . . considered good . .67 — 19. . . . . . . .38 —Deposit account* . . . .29 144. . . . . 2006—Rs. . . . . . . . 2007 2006 2006 2005 SCHEDULE 9 SUNDRY DEBTORS Secured. . . . . .18 334. . . . . . . . .98) unutilised out of issue of 2% Fully Convertible Debentures converted into 1. . . . . . . . .33) (4. . . . . . . . . .194. . . . . . . . SCHEDULE 11 LOANS AND ADVANCES Unsecured. . — — — (30. . . . . .79 43. . . . . . .07 (as at March 31. . . .05 891.82 21. . . .33 Loans to employees . . . . . . . . . 2007—Rs 384. . . . .81 Less: Provision for doubtful advances . 9. . 5. .05 847.78 2. . . 2007 and March 31. .27 11. . . . . . . . . . . . . . . .99 60. . . . . . . . . .

. 104. . . . . . . . . . . . . . . . . . . .01 68. .32 0. . — 7. . . . . . . . .43 0. . . . . . . 268. . . . . . . .39 158. . . . . . . . . . . . . . . . . . .75 Other current liabilities .50 — 1. . .60 6. . . . . . . . . . . . . . . . . . . . . . . . . . . 2006 (Amount INR Million) As at As at As at As at March 31. 0. . . . . . . . . . . . . . . . . . . . .82 5. 34. . . . . . . . . . . . 3. . . . . . . . . . . 13. . . . . . .62 142. . . . . . .94 229. . . . . . . . — 2. . . Schedules Forming Part of the Balance Sheet as at March 31. . . . . . . . . . . .93 22. . . . . . . . . . . . . . . .03 Security deposits .80 49. . . . . . .29 9. . . . . . . . . . .03 5. March 31. . . . . . . . .54 391. . . .74 1. .88 Dividend tax on proposed dividend .45 24. . . .42 11. .18 273. . . . .50 16. . . . . . . . . . .91 25. . . . .14 — 10. . . . . . . . . . . . .08 227.54 — 1. . 15.55 — — Provision for fringe benefit tax (net of advance tax) . .68 61. .90 35. . . . . . . June 30. .21 12. . . . . . . . . . . . 2007 2006 2006 2005 SCHEDULE 12 CURRENT LIABILITIES Sundry creditors . . . . . . . .86 3.03 5. . .52 52. .75 182. . . . . . . . . . .24 163 . . 0. . . . . . . .43 0. . . . . . . . . . . . . . . . . . . . . . . — 18. . . . . . . . . . .06 Advances from customers . . . . . . . .19 Provision for leave encashment . . . . . 2007 and March 31. . . . . . . . . . . . . .90 69. . . . . . .38 SCHEDULE 13 PROVISIONS Proposed dividend . . . . . .53 Provision for gratuity .73 Provision for wealth tax . . .11 40. .11 Provision for income tax (net of advance tax) . . . . . . . . June 30. . . . . .

27 Miscellaneous income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25 82. . . . . . . . .2006 (Amount INR Million) July 1. . . . . . .67) . . . . . . . . . . . . . . . . . . . . . .01 102. . .28 8. . . . . 8. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 6. . . . . 1. . . .51 — Excess provision written back . . . . . . .83 9. . . . . . . . . . . . . . . . 4. . . . . . . . . . . . . .80 95. . . . . . . . . .52 57. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42 710. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2006 to July 1. . . 2005 to March 31. . . 73.92 1. . . . . . . . . . . . . . . . .36 781. . . . . . . 517. . . 3. . . . . . .100. . . . . . . . . . . . . . . . . . . . . . — 10. . . . . . . . . . . . .61 98. . . . . . . . . . . . . . . . . . . .45. . . .33 488.85 1. . . . . . . . . . . . . . . . .17 50. . . . . . . .09 Interest on fixed deposit (tax deducted at source—Rs 17. . . . . . . . . .51 58. .53 Sub-total (A) . . . net of freight subsidy of Rs 3. . . . . . . . .58 Cost of trading goods Opening stock . . . . .93 — Sub-total (C) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0. . . Schedules Forming Part of the Profit and Loss Account for the nine months period ended March 31. . .42 Add: Cost of purchases (including freight. . .08 Work in progress . . . 2006 SCHEDULE 14 OTHER INCOME Dividend received . . . . . . . . . .72 389. . . . (9. . . . . . .78 Export incentives . . . . . . . . . . . 2007 March 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12) (Increase)/ decrease in excise duty Excise duty on closing stock . . . . . . . . . . . . . . . . . .16 Processing income . . . . . . .18 3. . . . . . . .97 46. . .09 Excise duty on opening stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10 4. . . . . . . . . . . . . . . . . .56 SCHEDULE 15 MATERIAL COSTS Raw and packing materials consumed Opening stock . . . . . . . . . . . . . 923. . . . . . . . . 9. 53. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .478. . . . . . . . . . . . . . . .42 Sales tax incentives . . .69 38. . . . .11 Less: Closing stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39. . . . . . . . . . .08 0. 1. . . . . . . .82 Total (A+B) . . . . . . . . . . . . 947. . . . . . . . . . . . . . . . .07 1. . . . . . .59) . . . . . . . . . . . 2. . . . 115. . . . . . . . . . — 3. . .99 Provision for free products under sales promotion scheme . . . . .30) 164 . . . . . . . . . . . . . . . . .62 Credit balances written back . .08 405. . . . . . . . . . . . . . . . . 99. . . 2006—Rs 2. . . . . 2006—Rs 13. . . . . . . . . . . .43 2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7. . . . . . . . . . . .55 Less: Closing stock . . . 97. . . . . . . . . . . . . . . . . . . . 53. . . . . . . . . . . . . . . . . . . . . . . .69 616. . . . . 500. . .57 SCHEDULE 16 (INCREASE)/ DECREASE IN INVENTORIES (Increase)/ decrease in inventories Closing stock Finished goods . . .25 Profit on sale of investment . . . . . . . .90. . . . . 0. .55 Sub-total (A) (10. . . . . . . . . . . . . . .47 46. . . . . . .54) (12. . . . . . . . . . . . . . . . . . . . . . . .56 Sub-total (B) . . . . . . .96 Bad debts recovered . . . . . 61. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48. . . . . . . . . . . . . . . . . . . .021.62) (10. . . 2007 and March 31. . . .58 42.34 8. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .89 50. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .78 738. . . . . . . . . . . . . . . . .06 5. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .93 — Total (A+B+C) . . . . . . . . . . . . 26. . . . . . . . . . . — 7. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .70 Add: Cost of purchases . .15 Work in progress . . .94 70. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .91 Sub-total (B) . . . . . . . . . . .67 Opening stock Finished goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. 1. . .07 Vehicle maintenance . . . . 3. . . . . . . .77 Commission to directors . . . . . .2006 (Amount INR Million) July 1. . . . . . . . . . . . . . . . — 4. . . . . . . . . . . . . . . .19 2. . . . . . . . . . . . . . . . . . . . . . . . . . . . .72 3. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0. . .29 0. . . 42. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .40 600. . . . . . . . . . . . . . . . . . . . . . . . . . . . .77 0. . . . . . . . . . . . . . .84 31. . . . . .18 Repairs and maintenance —Building . .49 227. . . . . . . . . . . — 0. . . . 15. . . . . 4. . . . . . . . . . . . 210. . . . . . . . . . . . . . . . .95 6. .07 12.29 Loss on discarded/sale of fixed assets. . . . . . .12 296. . . — 0. . . . . . . . . . . . . 5. . . . . . .60 Rates and taxes . . . . 1. . . . . . .52 Legal and professional fees . . . .65) . . . . . . . .36 Field staff expenses and awards . . . . . . . . . . . . . . . . . . . .30 Provision for doubtful debts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 225. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6. . . .57 245. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16. . . . .51 Staff welfare expenses .64 2. . . . .88 2. . . . .71 37. . . . . . . . . . . . . . . . 17. . . . . . . . . . . . . . .13 3. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17. . . . . . . . . . .28 0. .20 13. . . . . . . . . . . . . .46 Provision for doubtful advances . . .34 5. . . . . . . . . . . .35 SCHEDULE 19 INTEREST AND FINANCE CHARGES Interest on loans from banks . . . . . . . . . 5. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .61 Bad debts written off . . . . . . . . . . . . . . . . . . .35 21. . 6. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .07 1. . . . . . . . . . . . . 51. . . . . . . . . . . . . . . . . . . .16 Traveling and conveyance . . . 27. . . . . . . . . . . . . . . . . . . . . 52. . . . . . . . . . . . . . . .94 Sales promotion and schemes . . . . . . . . . . . . . . . 13. . . . . . . . . . 2006 SCHEDULE 17 EMPLOYEE COSTS Salaries. . . . . . . 2. . . . . . . . . . . . . . . . . . .79 26. . . 28. . . . . . . . . . . . . . . . . . .08 Donation . . . . . . 2007 and March 31. . . . . . . . . . . . . . . . . net .96 Power and fuel expenses . . . . . . . . . . Schedules Forming Part of the Profit and Loss Account for the nine months period ended March 31. . . . . . . .00 Directors’ remuneration . . . . . . . . . . 48. . . .22 160. . . . . . . . . . . . . . .32 5. . . . . . .18 4.64 —Plant and machinery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0. . . . . . . . . . . .78 42. . . . . . . . . 2006 to July 1. . . .81 — Provision for dimunition in value of investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12 SCHEDULE 18 OTHER EXPENSES Conversion charges . . . . . . . . . . . . . . . . . . . . . . . . . . . .72 Printing and stationery . . 20. . . . . . .41 8.70 8. .91 —Others . . . . . .13 Bank charges and commission . . . . . . . . . . . . . . . .01 165 .10 Advertisement and publicity . . . . . . . . . . net . . . . . . . .92 592. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18 22. . . . . . . . . . . . . . 2006—Rs 0. . . . . . .43 Gratuity . . . . . . . . . . . . . . . . . . . . . 0. . . . . . . .03 Field staff incentives . . . . . . . .48 Brokerage on sales . . . . . . . . . . .37 13. .67 1. . . . .30 0.30 Directors’ sitting fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16 16. . . .62 Research and development . . . . . . . . . . . . . . . . . .39 39. . . . . . . . . . . . . 3. .15 Communication costs . . . . . . . . . . . Rs 2. . . . . . . . . . . . . .99. . . . . . . . . . 0. . . . . . . . . . . .00 Exchange loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2005 to March 31. . . . . . . . . . . . . . . .36 Insurance . . . . . — 75. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2007 March 31. . 2. . . wages and bonus . . . . . . . . . . . . . . . . . . 4. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .07 1. . . . . . . . . . . 15. . .34 5.51 0. . . . . . .43 Sundry advances written off . . . . . . . . . . . . . . . . . . . . . . . . . . 1. . . . . . . . . . . . 10. . . . . . . . . . . . . . . . . . . . . .80 Miscellaneous expenses . . . . . . . . . . . . . . . . . . . . . .53 0. .50 Rent . . . . . . . . .26 Contribution to provident and other funds .41 Carriage outwards (net of subsidy. . . . . . . . . . . . . . . . . . . .86 32. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . Schedules Forming Part of the Profit and Loss Account for the nine months period ended March 31. . 12. .78 21.51 (c) Disputed excise duty and service tax demand—matter under appeal . . . . . .67 22. . . . . . . . . . . .23 38. . . . June 30. . . . .80 0.70 9.00 1.00 2. . . . . .00 12. . .85 (iii) Claims against the Company not acknowledged as debt . . .00 12. . . . . . . . . . . . June 30.43 280. .65 1. . . .2006 (Amount INR Million) As at As at As at As at March 31. 2007 and March 31. . . .65 2. . . . . . . . . . . 34. . . . . . . . . . . 2. . 3.65 1. . . .82 2. 1. . . . . . . . . . . . . . . . . . . .23 2. .17 (b) Disputed sales tax demands—matters under appeal . .69 318.20 (This space has been intentionally left blank) 166 . . . . . .00 — 54.67 (ii) Tax matters (a) Disputed liability in respect of income-tax demands— matters under appeal . . . . . . . . . 2007 2006 2006 2005 SCHEDULE 20 CONTINGENT LIABILITIES Contingent liabilities not provided for in respect of: (i) Amount outstanding in respect of guarantees given by the Company to banks . . March 31.94 2. . . . . . .

c) Impairment i. the estimated future cash flows are discounted to their present value at the weighted average cost of capital. and in accordance with the mandatory accounting standards issued by the Institute of Chartered Accountants of India and referred to in Section 211(3C) of the Act and generally accepted accounting principles in India. An impairment loss is recognized wherever the carrying amount of an asset exceed its recoverable amount The recoverable amount is the greater of the assets net selling price and value in use. 167 . mosquito coils and incense sticks. 2006 (All amounts in million of Indian Rupees) 1 BACKGROUND Jyothy Laboratories Limited (‘the Company’) was incorporated on January 15.1992. ii. b) Depreciation Depreciation is provided using the Straight Line Method as per the useful lives of the assets estimated by the management. 3 SUMMARY OF ACCOUNTING POLICIES The significant accounting policies are as follows: a) Fixed assets Fixed assets are stated at cost. Cost of shares of Co-operative society has been added to the cost of office building. The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. or at the rates prescribed under schedule XIV of the Companies Act. SCHEDULE 21—NOTES TO THE FINANCIAL STATEMENTS FOR THE NINE MONTHS PERIOD ENDED MARCH 31. detergents. 1956 whichever is higher The estimated useful life of the assets is as follows: Category Estimated useful life (in years) Buildings 30-60 Plant and machinery 3-21 Electrical installations 20 Furniture and fixtures 12 Dies and moulds 1-3 Computers 6 Office equipments 20 Vehicles 8-10 Trademarks 9 Leasehold land is amortised over the period of the lease on a straight-line basis. The Company is principally engaged in manufacturing and marketing of soaps. After impairment. depreciation is provided on the revised carrying amount of the assets over its remaining useful life. less accumulated depreciation and impairment losses if any. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use. Borrowing costs relating to acquisition of fixed assets which takes substantial period of time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to be put to use. 2007 AND MARCH 31. In assessing value in use. 2 BASIS OF PREPARATION OF FINANCIAL STATEMENTS The financial statements of the Company are prepared under the historical cost convention on accrual basis of accounting.

Cost of work in progress and finished goods includes materials and all applicable manufacturing overheads. h) Revenue recognition Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction. in the value of investments. Where the grant or subsidy relates to an asset. work-in-progress. is made to recognize a diminution. and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined. other than temporary. by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction. Excise Duty. Provision. d) Operating Leases Lease payments on operating leases are recognized as expense on a straight-line basis. SCHEDULE 21—NOTES TO THE FINANCIAL STATEMENTS—(Continued) FOR THE NINE MONTHS PERIOD ENDED MARCH 31. packing materials. e) Government grants and subsidies Grants and subsidies from the government are recognized when there is reasonable assurance that the grant/ subsidy will be received and all attaching conditions will be complied with. (ii) Conversion Foreign currency monetary items are reported using the closing rate. over the lease term. 2007 AND MARCH 31. it is recognized as income over the periods necessary to match them on a systematic basis to the costs. 2006 iii. g) Inventories Inventories of raw materials. where necessary. whichever is lower. which it is intended to compensate. 168 . However the carrying value after reversal is not increased beyond the carrying value that would have prevailed by charging usual depreciation if there was no impairment. i) Foreign currency translation (i) Initial Recognition Foreign currency transactions are recorded in the reporting currency. finished goods. f) Investment Long term investments are stated at cost. Interest Revenue is recognised on a time proportion basis taking into account the amount outstanding and the rate applicable. its value is deducted in arriving at the carrying amount of the related asset. When the grant or subsidy relates to an expense item. The Company accrues for excise duty liability in respect of manufactured finished goods/ intermediary inventories lying in the factory. Sale of Goods Revenue is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer. Cost is ascertained on First-in-First out (‘FIFO’) basis and includes all applicable costs incurred in bringing goods to their present location and condition. stores and consumables items are valued at cost or net realizable value. A previously recognized impairment loss is increased or reversed depending on changes in circumstances. Sales Tax and VAT deducted from turnover (gross) is the amount that is included in the amount of turnover (gross) and not the entire amount of liability arised during the year.

Deferred income taxes reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years. In the year in which the Minimum Alternate tax (MAT) credit becomes eligible to be recognised as an asset in accordance with the recommendations contained in the Guidance Note issued by the Institute of Chartered Accountants of India. whichever is lower. Deferred tax assets and deferred tax liabilities across various countries of operation are not set off against each other as the company does not have a legal right to do so. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. the said asset is created by way of credit to the Profit & Loss Account and shown as MAT Credit Entitlement. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates. it is probable that an outflow of resources will be required to settle the obligation. Provisions are not discounted to its present value and are determined based on best estimate required to settle the obligation at the balance sheet date. k) Income-tax Tax expense comprises of current. are recognised as income or as expenses in the year in which they arise except those arising from investments in non-integral operations. n) Excise duty Excise duty on turnover is reduced from turnover. 2004 are added to the cost of such assets in line with Old AS 11 (1994). Excise duty relating to the difference between the opening stock and closing stock is recognized as income / expense as the case may be. deferred and fringe benefit tax. The Company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during the period. Unrecognised deferred tax assets of earlier years are re-assessed and recognised to the extent that it has become reasonably certain that future taxable income will be available against which such deferred tax assets can be realised. or reported in previous financial statements. Cost is ascertained on First-in-First out (‘FIFO’) basis and includes all applicable costs incurred in bringing goods to their present location and condition. Current income tax and fringe benefit tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act. Exchange differences arising in respect of fixed assets acquired from outside India are capitalized as a part of fixed asset. If the company has carry forward of unabsorbed depreciation and tax losses. SCHEDULE 21—NOTES TO THE FINANCIAL STATEMENTS—(Continued) FOR THE NINE MONTHS PERIOD ENDED MARCH 31. in respect of which a reliable estimate can be made. The liability for gratuity and leave encashment is provided for based on valuation by an independent actuary at the year end. m) Provisions A provision is recognised when an enterprise has a present obligation as a result of past event. j) Retirement and other employee benefits Retirement benefits to employees comprise payments for gratuity. deferred tax assets are recognised only if there is virtual certainty that such deferred tax assets can be realised against future taxable profits. l) Sales promotion items Sales promotion items are valued at cost or net realizable value. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. Exchange differences on liability relating to fixed assets acquired within India arising out of transactions entered on or before March 31. leave encashment and provident fund. separately in the Profit and Loss account 169 . 2006 (iii) Exchange Differences Exchange differences arising on the settlement of monetary items or on reporting company’s monetary items at rates different from those at which they were initially recorded during the year. Contributions to provident fund are charged to the profit and loss account as incurred. 2007 AND MARCH 31.

requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the results of operations during the year end. Jyothy (Director w. Divakaran (Director) M. Travancore Trading Corp. Sidharthan M. 170 . in conformity with generally accepted accounting principles. 4 RELATED PARTY DISCLOSURES a) Parties where control exists Individual having control M. Ramachandran Wholly Owned Subsidiary Sri Sai Home Care Products (P) Limited b) Related party relationships where transactions have taken place during the period Joint venture company Balaji Telebrands Limited Relatives of individual having control are partners in the firm Beena Agencies Quilon Trading Co. Although these estimates are based upon management’s best knowledge of current events and actions.G. SCHEDULE 21—NOTES TO THE FINANCIAL STATEMENTS—(Continued) FOR THE NINE MONTHS PERIOD ENDED MARCH 31.e. M. Agencies Tamil Nadu Distributors Proprietor—Relative of individual having control Deepthy Agencies Sahyadri Agencies Sreehari Stock Suppliers Sujatha Agencies Shanti Industries Relative of individual having control Sahyadri Agencies Ltd.P. 2006 o) Use of estimates The preparation of financial statements. October 24. 2005) M R Deepthy Ananth Rao T M.f.R. Ullas Kamath Deputy Managing Director As the Managing Director of the Company is an individual having control and hence not separately disclosed as a Key management personnel. Santhakumari Key management personnel K.P. actual results could differ from these estimates.P. 2007 AND MARCH 31. Sree Guruvayurappan Agencies M.P.

. . . . 1. . 3. . . . . . . . . .76 — Enterprises in which relatives are interested Sale of finished goods Beena Agencies . . . . . . . . . . .72 Tamil Nadu Distributors . . . . . . . to March 31. .21 1. . . . . . . . 2. . . . .82 Dividend . . . . . . . . . . . . . . . . . . . . . . . 19. . . . . . . . . . . . . . . . . . . . 78. . . . 2006 July 1. . . . . . . .53 35. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .48 Others . . . . . . .07 1. . . . . . . . . . . . . . . . 68. . . . . . 2007 2006 Claims for reimbursement for sales promotion expenses Sreehari Stock Suppliers . . . . 10. . . . . . . . . . . . 2005 to March 31. . . . . . . . . . . . .26 32. . . . . . . . . . . . . . . . . . . . .45 Key management personnel . . . . . . . . . . . . .38 — Purchase of fixed assets . . . . . . . . . . . . . . . . . . . . . . .90 0. . . . . . . . .13 0. . . . 2. . . . . . . .10 8. . . .93 1. . . . . . . . . . .00 80. . . . . . . . . . . . .90 M P Divakaran . . . . .11 2. . . . . . . . . . . . . . . .97 Relatives of individual having control . .47 July 1. . . . . . . . . . . . . . . . 0. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Remuneration . . . . . . . . . . . . . . . . . . . . . . 0. . 2007 2006 Wholly owned subsidiary Purchase of finished goods . . . . . . . . . . . . . . . . . . . . . . . . . . . 0. . . . . .07 7. . . . . . . . . . . . . . . 0. . . . . . . . 2006 July 1. . . . . . . . . . . . . . . . . . . . .10 Commission . 52. . . . . . . . . . . . . . . 2007 AND MARCH 31. . . . . . . 10. . . . . . . . .69 57. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .51 Commission . . . . . . . . . . . . . .54 117. . . . . . . 43. . . . . . . . . . . . . . . . . . . . . . . . . . .37 — Joint venture company . . . . . . . . . . . . . . . . .21 d) Related party balances Amounts receivable Subsidiary Company . . . . . . . . . . . . . .84 — Individual having control . . . . . . . . . . . . . .81 43. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. .91 Sujatha Agencies . . . . . . . . .17 — Ananth Rao T . . . . . . . . . . . . . . . . . . . . . . . . .27 — Dividend . . . . . . . . . .53 35. . . . . . . . 7.26 — Key management personnel Remuneration . .03 Sreehari Stock Suppliers . . . . . . . . . . . . . . . . . . . . . . . 145. . . . . . .27 Relatives of individuals having control Remuneration M R Jyothy . . . . . . . . 0. . . . . . . . . . . . .09 Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27 Enterprises in which relatives of individual having control are interested . . . .51 7. . . . . . . . . . . . . . . . . . . . . . . . . . 0. . . . . . . . . . . . 8. . . . . . . . . . . . . . . . . . . . . . . .87 — Sale of plant and machinery . . . . . . . . . . . . . . . . . . . . .60 23. . . . . . . . . . . . . . . . . . . . . . . . 0. . . SCHEDULE 21—NOTES TO THE FINANCIAL STATEMENTS—(Continued) FOR THE NINE MONTHS PERIOD ENDED MARCH 31. . . . . . . . . . . . . . . . . . . . . . . . . . 2006 c) Transactions with related parties during the period July 1. . . . . . 2. . . . . . . . . . . . . . . . . . . . . . . . .69 Amounts payable Joint venture company . . . . . . . . . . . . . . Investment in shares . . . . . . . . .46 48. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .90 M R Deepthy . . . .53 — Individual having control . . . . 56. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2005 to March 31. .49 171 . . . . . . . . . .05 1. . . . . . . . . . . . . .04 46. . . . . . . . . . . . . . . 2. . . . . . .25 — Purchase of finished goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .57 Purchase of raw material . . . . . . to March 31. . . . . . . .80 20. . . . . . . 7. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57.32 Sujatha Agencies . . . .26 M P Sidharthan . 35.27 1. . . . 0. . . . . . . . . . . . . . . . . .98 Sree Guruvayurappan Agencies . . . . . . . . .90 0. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0. . . . . . . . .46 0. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37. . . .05 4. . . . . . .16 34. . . .51 10. . .37 Tamil Nadu Distributors . . . 0. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3. . . .

SCHEDULE 21—NOTES TO THE FINANCIAL STATEMENTS—(Continued) FOR THE NINE MONTHS PERIOD ENDED MARCH 31. . . .33 8. . . (This space has been intentionally left blank) 172 . .70 74. 2006—Rs 8. 43. . . . .71 Payable later than one year and not later than five years . . .46 11. . .56 6 Advance to suppliers include as at March 31. which expire at various dates over the next five years. . Lease rental expense for the nine month period ended March 31. . . . . . . . . . . . the advances given are considered good and no provision has been made against these advances. . . . . . . . . . .15 Payable later than five years . . 2007 2006 Future lease payment under operating leases are as follows: Payable not later than one year . . . . . . . .48 39. 2007 AND MARCH 31.36) As at March 31. .50 (as at March 31.50) for which the Company is in the process of entering into an arrangement for the recovery of advances. . . . 15. . . . . . .27 59. 2007—Rs 8. . . . . Accordingly. 15. 2007 was Rs 13. .41 (2006—Rs 8. . . . 2006 5 OPERATING LEASES The Company has entered into lease agreements for premises. . . . As at March 31. . . . .

2007 2006 I ASSETS Current Assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . the Company had recorded accumulated impairment loss of Rs 25. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0. . . . . . . . . . . . . . . the Company’s share of each of the assets. . . 5. . . . . . . . . . . . . . . . . SCHEDULE 21—NOTES TO THE FINANCIAL STATEMENTS—(Continued) FOR THE NINE MONTHS PERIOD ENDED MARCH 31. . . . . . . . . . . . . . . . . . . 3. . . . . . . . . . . . . . March 31. . . . . . . . . 0. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2007 AND MARCH 31. . . . . . . .50 — (d) Loans and advances & deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . However. . . . . . . . . . . . . . . . . . . . . .17 — For the period ended March 31. . . . . . . .13) as an adjustment to the general reserves. . . . . . . . . 173 . . . . . . . . . . liabilities. . . . . . .76 — (b) Sundry debtors . (each without elimination of. . . . . . India 50% — The Company’s interest in the Joint Venture is reported as long term investment (Schedule 7) and stated at cost. . . . . . . . . . . . . . . . . . . . . . . . March 31. . . . . . . . . . . . . . . .24 — (d) Miscellaneous expenditure w/off . . . . . . 0. . . . . . . . . . . . . . . . . 1. . . . . . . . . . . . . . 0. . . . . . . (0. . . . . . . Name Incorporation 2007 2006 Balaji Telebrands Limited . . . . . 2004. . . . . .70 — II LIABILITIES Unsecured loans .30 — (c) Administrative expenses . . . . . . . . . . . . . . . . . . . . .42 — (c) Cash and bank balances . . . . . . . . . . . . . . . . . . . . . . . the effect of transaction between the company and joint venture) related to its interests in this joint venture. . . . . . .15 — 8 During the earlier years. . . . . 2007 2006 III INCOME Sales . . . . . . . . . . . . . . . . . . 0. . In accordance with the transitional provisions of the new Accounting Standard (AS 28) relating to ‘Impairment of Assets’ that became effective from April 1. . . . . . .87 (net of deferred tax credit of Rs 13. . . . as a venturer. . . . . . . depreciation/ impairment on assets includes impairment losses representing the amount by which the carrying amount of the asset exceeds its recoverable amount. . . . . . . . income and expenses etc. . . . . . . . . . . . . . . . . . . . . . . . . 0. . . . .44 — (b) Provisions . . . . .26 — IV EXPENSES (a) (Increase)/Decrease in stock . . . based on audited financial statements are : As at As at March 31. . . . . . . . . . . . . . . . . . . . . in jointly controlled entities (Incorporated Joint Venture) is: Percentage of ownership interest As at As at Country of March 31. . . . . . . . . . . . . . . . . . . . 2. . . . 4. . . . .76) — (b) Purchases . . . . . 2006 7 Interest in Joint Venture : The Company’s interest. . . Loans and Advances (a) Inventories . . . 0. The pre-tax discount rate used for evaluation of the present value was 8% per annum. . . . . . .36 — Current liabilities and provisions (a) Liabilities . . . . Such impairment losses were due to adverse market conditions for the one of its Cash Generating Unit pertaining to the ‘Soaps and Detergents’ segment. . . . . March 31. . .04 — (e) Provision for taxation . . . . . . . . . . . . . . . . . .

2007 Deputy Managing Director Company Secretary Place: Mumbai Date: June 6.L. Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M. SCHEDULE 21—NOTES TO THE FINANCIAL STATEMENTS—(Continued) FOR THE NINE MONTHS PERIOD ENDED MARCH 31.R.: 41870 Place: Mumbai K. Ullas Kamath M. Ramachandran Partner Chairman and Managing Director Membership No. 2007 AND MARCH 31. 2007 174 . P. Bansal Date: June 6. 2006 9 The prior period figures have been reclassified where necessary to confirm with current period’s presentation. Signatures to Schedules 1 to 21 As per our report of even date For S.

09 million as at March 31. 2007 and March 31. Our responsibility is to express an opinion on these financial statements based on our audit. These financial statements are the responsibility of the Company’s management and have been prepared by the management on the basis of separate financial statements and other financial information regarding components. 2007 and March 31. evidence supporting the amounts and disclosures in the financial statements. except that the Company has not presented the information required to be disclosed by Accounting Standard 17 – ‘Segment Reporting’ issued by the ICAI. An audit includes examining. and to the best of our information and according to the explanations given to us. We report that the consolidated financial statements have been prepared by the Company’s management in accordance with the requirements of Accounting Standard 21 – ‘Consolidated Financial Statements’ and Accounting Standard 27 – ‘Financial Reporting of Interests in Joint Ventures’ issued by the Institute of Chartered Accountants of India (‘the ICAI’).42 million and Rs 59. These financial statements and other financial information have been audited by other auditors whose reports have been furnished to us. as well as evaluating the overall financial statement presentation. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. 2006 and also the consolidated profit and loss accounts and the consolidated cash flow statements for the nine months period (‘the period’) ended on those dates annexed thereto. as at March 31. 3. We have audited the attached consolidated balance sheets of Jyothy Laboratories Limited (‘the Company’). and group share of total revenue of Rs 65.01 million for the period then ended.26 million and net cash outflows amounting to Rs 0. and the net cash inflows amounting to Rs 1. We conducted our audit in accordance with the auditing standards generally accepted in India. We did not audit the financial statements of the subsidiary and the joint venture. An audit also includes assessing the accounting principles used and significant estimates made by management. and are not to be used for any other purpose or referred to in any document or distributed to anyone without our prior written consent. whose financial statements reflect the groups share of total assets of Rs 71. issued by the ICAI. Based on our audit and on consideration of reports of other auditors on separate financial statements and on the other financial information of the components. Auditors’ Report The Board of Directors JYOTHY LABORATORIES LIMITED 1. 2006 respectively.04 million and Rs 36. 2006 respectively. we are of the opinion that the attached consolidated financial statements give a true and fair view in conformity with the accounting principles generally accepted in India: 175 . The accompanying financial statements have been prepared by the Company in accordance with the requirements of Accounting Standard 25 – ‘Interim Financial Reporting’.32 million for the period ended on March 31. on a test basis. 2. 5. and our opinion is based solely on the report of the other auditors. We believe that our audit provides a reasonable basis for our opinion. 2007 and March 31. 4. 6. which does not have an impact on the profit for the period. These financial statements are prepared solely for use of the information to be given in the Draft Red Herring Prospectus of the Company in connection with the proposed issue of equity shares to the Public and Financial Institutions.

b. 2007 176 . in the case of the consolidated balance sheets. of the state of affairs of the Company as at March 31. and c. Batliboi & Associates Chartered Accountants Per Sudhir Soni Partner Membership No. 2007 and March 31. 2006.R. 2007 and March 31. 2007 and March 31. For S. 2006. in the case of the consolidated profit and loss accounts. a.: 41870 Place: Mumbai Date: June 6. of the cash flows for the period ended on March 31. 2006. in the case of the consolidated cash flow statements. of the profit for the period ended on March 31.

. . . . . . . .98 INVESTMENTS . . . . . 8 300.00 1. . .66 50. . .443.10 0. . . . . . . . . 1. . . 1 72. .828. . . . . .R. As per our report of even date For S. . . . . CONSOLIDATED BALANCE SHEET AS AT MARCH 31. .887. . . .68 237. . . 549.89 334. . . . . . . . . .331.30 240.63 2. . . . . . . . . . . . .237. . . . . . . . . . . . . . LOANS AND ADVANCES Inventories . . . . Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M. . . . 2 2.56 APPLICATION OF FUNDS FIXED ASSETS 6 Gross Block . .42 2. .76 LOAN FUNDS Secured loans . 22 The schedules referred to above and notes to accounts form an integral part of the financial statements.86 855. . SCHEDULE 2007 2006 2006 2005 SOURCES OF FUNDS SHAREHOLDERS’ FUNDS Share capital . .57 2. . . . . . . .627.782. . 2007 177 . . . . . .48 1. .634. .78 282. . . . . . . . . 10 690. . . . . . .60 Other current assets—Sales promotion items . .088. . . . .127. . . .47 2. . . .46 62. .521. . . . . . . .57 Reserves and surplus .216. .16 11. . . . . .49 831. . . . . . . . . . .47 2. . .55) Net Block . .63 2. .79 1. .16 CURRENT ASSETS. . .21 334.: 41870 Place: Mumbai K.756. . . . . . . .932.33 5. . . . . . . .36 35. .307. .35 Capital work-in-progress (including capital advances) . . .26 198. . . . (310. . . 3 0. . .57 72. . .16 9. . . 2007 Deputy Managing Director Company Secretary Place: Mumbai Date: June 6. . .12 85.887. . . . . . . .15 1. .P.13 147. . . . . . . 13 50. .629. . 2007 AND MARCH 31. . . . . Bansal Date: June 6. . . . . . . . .15 — — — (to the extent not written off or adjusted) 2. . . . . . . . . .85 Loans and advances . .67 1. . .L. . . . . . .96) (257.74 450. .14 318. . .54 Sundry debtors . 9 629.449. . . . .57 72. .63 1. .06 2.569. . . .46 869. . .25 4. . .01 Unsecured loans . . .569. . . . . . .08 930. . . . .09 Provisions . . . .727. . Ullas Kamath M. . . June 30. .09 0. 2. . . . . . . .308. . .58 2. . . .03 1. .00 106. . .10 Cash and bank balances . . . . . . .78 895. . . . . . . .57 72. . . . .277.46 2.67 40.349. . .237. . . .17 1. . . . .60 252.74 20. . . .31 2.83 NET CURRENT ASSETS . . .17 892.29 64. . .634. . . . . . .56 Notes to accounts . . . . . . 2006 (All amounts in millions of Indian Rupees) As at As at As at As at March 31. . . . . .02 1. .42 2. . . . . . . .03 52. . . . . .22 75. March 31. . . . . . .78 249.45) (219. . 1.01 0.34 784. .046.16 18. . 11 158. . .18 62. . . . June 30. . .53 1. . . . . . . . . Ramachandran Partner Chairman and Managing Director Membership No.144. . .61 1.19 2. .90 3. . . . . . .16 1. . 12 400. . . . . NET . . . . 5 54.515. . . . . . 4 5.24 1. . . . . . . . . . . . . . . 14 0. .80 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . 997. . . .01 0. . .34 DEFERRED TAX LIABILITY.25 Less: CURRENT LIABILITIES AND PROVISIONS Current liabilities . . .42 Miscellaneous expenditure . . . . .76 303. .67 2. . . . . . . .52 199. .00 2.003.71 296. . . . . . . . . . . .35 277. . . . . . . . . . . .547. . . . .81) (271. . . . . . . .45 1. .01 61. . . . .90 Less: Accumulated depreciation and impairment . . . . .63 2. . . . . 7 9.01 2. . . . . . . . . .

83 PROFIT AND LOSS ACCOUNT. . . . . . . . . . . . . . . . . . . .61 395. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1. . . . . . . . . . . . . . .69 301. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87. . . . . . . . . . . . .57) Less: Excise duty recovered . . . .96) Less: Trade discount (includes Rs Nil. . . . . . . . . . .Fringe benefit tax .13 4. . . . . . . . . . . . . 2006 Rs 17. . . . . . . . . . . . . .256. . . . (174. . . . Ullas Kamath M. . . . . . .65 APPROPRIATIONS: Interim dividend to equity shareholders .47 2. . . . . . . . . . . . . . . March 31. . . . . . . . . . . . . . . . . . . . . . . . . . . .54 pertaining to previous year sales) . . . . .28 2. . . . . . . 3. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Current tax—Share of Joint Venture . . . . . .71 251. . . . . . . . 54. . . . . . . .04 2. . . . . . Bansal Date: June 6. . . . . . . . . . . . . . . . . . . . . . . . . . . . .93 Interest and finance charges . . . . . . . . . . . . . . . . July 1. . . . . . . . . . . .57 39. . . . 7. . . . . . 2007 AND MARCH 31. . . . .61 360. . . . . . . . . . . . .08 1. . . . . . . . . . . . . . . . . . .880 Notes to accounts . .94 393. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Wealth tax . . . . . . . . .294. . . . . . . .46 Less: Sales tax recovered . . . . . . . . . . . . . . . . . . . . . . .381. .29) Excise duty . . . . . . . .42 Employee costs . . . . . . . . . . . . . . . . . . 17 (4. . . . . . . . . . . .28 . . . . . . . . . . . . . . . . . . . 15 102. . . . . . . . . end of the period . 2006 (All amounts in millions of Indian Rupees) July 1. . .57 — Dividend tax on interim dividend . . . . . . . . . . . . .23 . . . 395. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2. . . . . . . . . . . . . . . . . . . . . . . . . . . . .31 EXPENDITURE Material costs . . . . . . . . . . . . . . . . . . . . . . . . .74 Other income . . . . . . . . . . . 400. . . . . . . . . . . . . . . . . 2006 to 2005 to March 31. . . . . . . . . . . . . . .51 Prior period item—Advertisement expenses . . . . . . . . . . .256. . . . . . . . . . . . . . . . . 10 10 Weighted average number of shares outstanding for calculation of Basic and Diluted EPS . . . . . .53 41. . . . . . . . . . . .775. . . . . . . . . . . . . . . . . . . . . . . . . . . . 23. . . . . . . . . . . . . . . . . . . . . . . . 6 45. . . . . . . . . . . . .27 0. . . . . . .: 41870 Place: Mumbai K. .00) (151. . . . . . . . . . . . . . . . . . . . . . . . . 10. . . . . . . . . . . . . . . . . . . . . . .57 2. . . . . . . . . . 16 1. . . . . . . . . .65 EARNINGS PER SHARE (EPS) Basic and Diluted (Rs) . . . . . . . .81 95.878. . . . . .19) Net sales . . . . . . . . . .37 30. . . .P. . . . .985. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7. . . . .L. . . . . . . . 0. . . . . . . . . .880 7. . .57 2. . . . . . . . . . . . 0. . .82 PROFIT AVAILABLE FOR APPROPRIATION . . . . . 44. . . . — 6. . . . . . . . . . . . . .16 Provision for tax . . . . . .68 598. . . . . . . . . . . . . . . . . (58. . . . . . . . . . .70) (319. . . . . . . . . . . . . . . . . . . . . . .078. . . . . . .Deferred tax charge . . 72. . . . .15 — . . Ramachandran Partner Chairman and Managing Director Membership No. . . . . . . . . . . . . . . . . . . . . . . . . . . . (286. . . .19) (2. . . . . . . . .95 Depreciation . . . . . .447. . . . . . . . . . . . . . . . . . . . . . . . . . 19 611. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .32 PROFIT AFTER TAX . . . .19 393. . . . CONSOLIDATED STATEMENT OF PROFIT AND LOSS ACCOUNT FOR THE NINE MONTHS PERIOD ENDED MARCH 31. . . . . . . . . . . .85 PROFIT BEFORE TAX . . . . . . . . . . . . . . . . . . . . . . . . — 28. . . . . . . . . . . . . . . . . . . .38 (Increase)/ decrease in inventories . . . . Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M.67 1. . . . . . . .R. . . . . . . . . . . . . . . . . . . . . . . . . .37 Other expenses .Current tax . . . . . . . . . . . . . . 2007 Deputy Managing Director Company Secretary Place: Mumbai Date: June 6. . . . . . . . . . . . . . . . . . . . . . . . . . beginning of the period .25 91. . . . . . . . . .28 18. . . . . . . . . . . . . . . . . . . . . .54 1. . . . . . . . . .40) (40. . . . .80 PROFIT BEFORE PRIOR PERIOD ITEM AND TAX . . As per our report of even date For S. . . . . . . . . . . . . . . . . . . . . .797. . . . . . . . . . . . . .59 Nominal value per share (Rs) . . . . . . . . . . . . . . . .00 23. . . . . . . . . .429. . . . . . . . . . . . . . . . . . . . . . SCHEDULE 2007 2006 INCOME Sales (gross) . 448. . . . . . . . . . . . . . . . 448. . 482. . . . . . . . . . . . . . . 22 The schedules referred to above and notes to accounts form an integral part of the financial statements. . . . 18 303. . . . . . . . . . . . . . . . . . . . . . . . . 2007 178 . . . 20 2. . . . .18 — PROFIT AND LOSS ACCOUNT.50 Prior period item—Trade discount expenses .50 . .285. . . . . . . .

. .58) Receipt of investment subsidy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .04 Interest income . . . . .50 0. . . . . . .87) 414. . . . . . — (10. . . . . . . . . .42) Sundry advances written off (net of provision) . . . . . . . . . . . . . . . . . . . . . . .68 (Increase) / Decrease in current assets. 176. . . . . . . . . . . . . — 4. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 3. . . . . . . 119. . . . . . . . . . . . . . . . . . . . . . . . . . . . .46 Operating profit before working capital changes . . . . (334. . . . . 2006 (all amounts in millions of Indian Rupees) July 1. . . . . . . . . . . . . . . . . . . . . 2. . . . . . . . . . . . . . . . . . . . . . . . . . .19) Trade receivables . . . . . . . . . . . . . . . . . . . . . . . . . 0. . . . . .31 Net increase / (decrease) in cash and cash equivalents (A+B+C) . . . . . . . . . . . . . . . . . . . .93 Loss on discarded/sale of fixed assets. . . 184. . . . . . . . . . (64. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .48 892. . . . .58 B. . . . . . . . . . . . . . . . — 75. . . . . . (61. . . . 0. . . . . . . . .68 Preliminary Expenses—Share of Joint Venture . . . . . . . CASH FLOWS PROVIDED BY/(USED IN) INVESTING ACTIVITIES: Purchase of fixed assets (including capital work-in-progress and capital advances) . . .03) (76. .40 Taxes paid . . . . . . . . . . . . . . . . . . . . .96) Miscellaneous expenditure written off—Share of Joint Venture . . . . . . . . . . . .61 360. . . .17 179 .52 Interest received . . . . . . (12. . . . . . . . 0. . . . . . . . . . CASH FLOWS PROVIDED BY/(USED IN) FINANCING ACTIVITIES: Borrowing of loan fund . . . . 690. . . . . 2007 March 31. . . . . . . . CONSOLIDATED CASH FLOW STATEMENT FOR THE NINE MONTHS PERIOD ENDED MARCH 31.00 Proceeds from sale of fixed assets . . . .08 Deferred sales tax loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (6. . . . . . . . . . .71) (10. .53 0. . . . . . . . . . . . . . . . . . . . . . . . . . . . .83) (55. . . . . . . . net . .18) — Interest paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30 Provision for dimunition in the value of investments . . . . . . . .16 Adjustments for: Depreciation .09 Net cash provided by / (used in) investing activities . . (2. . . . . . .78) Excess provision written back . . . . . . . . . . . . . . .72) (1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2005 to March 31. . . . . . . . . . . .08) (1. . . . . . . . . . . . . . . . . . . . . . .88) Dividend tax paid . . (50. . . . . . . . . . . . . . . . . .82) Net cash generated from operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 0. . . . . . . .59 Cash and cash equivalents at end of period . . . . . . .15) 61. . . . . . . . . . . . . . 0. . . . . . . . . (50. . . . . . . . . . . . . . . . — 13. . . . . .08) (0. . . . . . . .54 Cash generated from operations . . . 442. .98 1. . . . . . (0. . . . . . . . . . .80 1.90 50. . . . . .61 1. . . . . . . . . . . . . . (101. . . . . . . . . . . . . .04 — Dividend received . . . . . . . . . . . . . . . . . . . .277. . . . . . . 3. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .90) (50.43 Profit on sale of investment . . . . (604. . . . . . . . . . . . . . . . . . . . 4. . . .307. . 2007 AND MARCH 31. . . . . . . . . . . . . . . . . .59 64. . . . . . . 2006 to July 1. . . . . . . . . . . . . . . . 2. . . . . .46 414. . . 61. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .83) 48. . . . . . . . . . . . . . . . . . . . . . . . . . . . .53) Net cash provided by / (used in) financing activities . . . . . . . . . . . . (667. . . . . . . . . . . . . . . .04 409. . . . . . . . . . . . . . . . . . . .09) Interest expense . . . . .00 Provision for doubtful advances . . . . . . . . . . . . . . .04) Dividend paid . . . . . . . . . . . . . . . . . . . . . . . . . (586. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .69) 0. . 2006 A. . . . . . . . . . . . . . . . . . . . .65 365. . . . . . . . . . . . . . . . . .78 Dividend received . . . . . . . . . . 448. . . .65) (68. . . . . . . . . 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (0. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CASH FLOWS PROVIDED BY/(USED IN) OPERATING ACTIVITIES: Net profit before taxation . . . . . . . . . . . . . . . . . . .58 Cash and cash equivalents at beginning of period . . . . . . . . . . . . . . . . . . . . . . .88 Proceeds from sale of investments . . . . . . . . . . . . .25) Loans and advances . . . . . .08 0. . . . .57 39. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (90. loans and advances Inventories (including sales promotion items) . . . . .69 C. . . . . . . .39) (43. . . . . . . . . . . .61 Bad debts written off (net of provision) . 45.81 — Provision for doubtful debts . . . . . . . 0. . . . . . . .36 61. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .08 1. . . . . . . . . .62 Increase in current liabilities / provisions . . . . . . . . . . . . . .

. . . . . .10 1. .86 —Deposit account* . CONSOLIDATED CASH FLOW STATEMENT FOR THE NINE MONTHS PERIOD ENDED MARCH 31.: 41870 Place: Mumbai K. . . . . . Bansal Date: June 6.05 690.26 Balance with scheduled banks—Current account . . . . . .56 1. . 2005 to March 31. . . . . . . . 2006 Components of cash and cash equivalents Cash in hand . . . . . . Ramachandran Partner Chairman and Managing Director Membership No. . . . . . . . . . . . . . . . . . . . . . . 2007 Deputy Managing Director Company Secretary Place: Mumbai Date: June 6. .50 — 690. .L. . . . . . . . .P. 89. . . . . . . . . . . .17 Share of Joint Venture . . . .307. . . .R. . . . . . . 2007 AND MARCH 31. . . .18 (2006—Rs. . 2007 March 31. . . . Ullas Kamath M. . . . . . . . . . .256. Batliboi & Associates For Jyothy Laboratories Limited Chartered Accountants Per Sudhir Soni M. . . . . . . . 2006 to July 1. . . . .17 * Includes deposits provided as securities against bank guarantees—Rs 4. . . .11 1. 2006 (all amounts in millions of Indian Rupees) July 1. . . 599. . . . . . . . . . . . . . . . . . .45 49. .61 1. . . . . . . . . 2007 180 . 3.307. . . 0. . .99) As per our report of even date For S. 1.

01 Accrued Interest . . . . . . . . . . . . . . investments and other movable assets SCHEDULE 4 UNSECURED LOAN Deferred sales tax loan . .00 100. . . . . . . . . . . . .449. . .00 100. . .65 91. . . . . .01 0.01 2. .01 0. . . . . . .59 3. .00 Less : Impairment loss . . . . . . . . . . .01 0. . .01 61.57 72. . . . . . . . . . . . . . .90 87.01 2. 6. . .19 Share of Joint Venture . . . . . . . . . .01 * The cash credit from bank is secured against fixed deposits # Term loan from bank is secured against first charge on standing crops on land. . . . . 2007 2006 2006 2005 SCHEDULE 1 SHARE CAPITAL AUTHORISED CAPITAL 10. . . . . . beginning of the period/ year . . . . .91 983. . . .31 1. . . . . . . . . . . . . . . . . . .33 1. . .57 72. . . . .065. .01 0. . . . .00 100. . . . . 1. . end of the period/ year . . . . 1. .31 Investment subsidy Balance. . . . .66 1. . . 1. .256. . . .09 0. . .065. . . . . . . . . . . . .17 1. . . . 100. . . .00 — 250. . . .25 393. . .15 General reserves Balance. . . . . . . . . . . . . .57 72. . . . . . . . . . .00 1. . .91 983.144. . . SUBSCRIBED AND PAID UP CAPITAL 7. . .00 2. Schedules Forming Part of Consolidated Balance Sheet as at March 31. .756. . . . . . . . . .06 2. . . March 31. . .59 6.91 Balance in profit and loss account . .57 SCHEDULE 2 RESERVES AND SURPLUS Share premium . . . . . .82 2.14 3. . .91 983. . . .36 — — — 5.283. — 3. . . . . .449. . .57 72. . . . . . . . . . . .00 100. . . . . .17 1. . . . . . . . . .14 2. .19 SCHEDULE 3 SECURED LOANS Cash Credit from bank* . . . . . . .57 72. . . .08 — Term loan from bank# .00 ISSUED. . . . June 30.755. . . . . .01 0.33 Share of Joint Venture . . . . . . .33 181 . .880 equity shares of Rs 10 each . . . . . . . .283.01 0. . . . . . . . . .144. . . . — 300. . . . .00 100. . . . . . . — — — — 0. . . . .29 — — — 2. . . . . . . . . .06 2. .02 1. . . . June 30. . . .87) Balance. 1.31 1. . . . .00 100.59 6.17 1. . .91 759. . . . . . . . . . . . . . . . . .57 72. . .45 3. . . . . . . . . . . . .57 72. . . . .71 2. . 0. .01 0. . . . . . . . . . . . . . — — 61.91 983. . . . . . . . . . . . end of the period/ year . . . .14 3. . . . . . . . .283. . . . . receivables. . . . . . . . — — — (25. . . . . . . .00 100. . 2006 (Amount INR Million) As at As at As at As at March 31. . .07 Balance. . . . . . . 72. . . 3. . 0. 2007 And March 31. .66 1. . . . . . . . . . . . 6. . . . . .065. . .000 equity shares of Rs 10 each . . . . . . . 399. . . beginning of the period/ year . .000. . .443. . .443. . . .065. . . . .78 Add : Transfer from profit and loss account . .91 1. . . .08 Add: Subsidy received during the period/ year . . . . . .31 1. . . . .

. . . . .78 58. . . .53 7. . . . . . . . . . . . 0.23 54. .64 Provision for doubtful advances . . . .13 13. . . . . .46 182 . . . . . .64 2. . .27 39. .54 1. . . . March 31. . . .82 89. . . . . . . . . . . . . . . . . .37 1. . . . . .90 9. . June 30. . . .05 Gratuity . . . . 13. . . . . . . . . . . . . . . . . . . . . .13 13.74 20. . . . .16 38. . . . . . 2007 2006 2006 2005 SCHEDULE 5 DEFERRED TAX LIABILITY. . . 0. . . .26 0.16 3. . . . .58 2. . . . . . 4. . Net a) Deferred tax liability Depreciation . . .68 37. . . 93. . . . 0. . . . . .52 Others . . . .91 1. . . . . 2006 (Amount INR Million) As at As at As at As at March 31. . .82 Provision for leave encashment .73 11. . .52 78. . . . . .52 78. . . . . . . . . . 11.69 93. . . . . . . . . .66 50. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .90 11. . . . . . . . . . . . . .13 13. . . . . . . . . .44 0.52 9. . . . . . . .82 8. . . . . . . . . . . . . . .71 8. .69 b) Deferred tax assets Technical royalty . . . . . . . . . . . . . . .71 89. . . . . . . . . 1. . . . . . . Schedules Forming Part of Consolidated Balance Sheet as at March 31. . . . . . . . . . . . . . . . . . . . . . .05 — — 0. . . .03 52. . 7. . . . . . . . . . . . . . . . . . . . . . . June 30. . . . 2007 And March 31. . . .82 89. . . . . . . . . . .13 Unabsorbed losses . . . .48 10. . . . . . . .54 Provision for doubtful debts .26 Provision for impairment losses . . . . . . .23 1. . . . . .71 89. . . . . . . .46 1. .

. . . . . . . . .88 0. (Also refer note under schedule 9) # Includes flats acquired from customer at agreed value of Rs 19. .83 14. .46 4. . . . . 29.04 11. . . . .54 — 523.91 22. . .47 1. . . . . . . . .38 101.96 — — — — 1.27 23. . .17 25. . 1. . .25 20.37 19. .58 — 70. . . .003.16 — 0. .26 1. .35 — 0. .96 45. . .22 38. .00 — 39. . . the March 31.19 2. . .308. . . .10 40. . .90 133. .50 4. . . . .34 438. .79 183 Goodwill arising on consolidation . the March 31.49 As at June 30. . . . . . .55 0. .52 — 0.10 — — — 1. . .09 232.41 9. .29 — 27.67 232.32 — 6. . . . . . .63 18. .127. . . . . .30 56.25 10. .05 Dies and moulds . . . . . . .55 56. . . . . . .16 2.127. . . . . July 1. .04 — 1. . .89 0. . . . . . .34 4. . . .67 392.78 0.59 20. . . June 30. .49 * Includes land acquired from customer at agreed value of Rs 1.26 2. . 9. .86 855.17 26. . .75 21. 33. . .46 71. . .93 8. . . .41 Office equipments .13 327. .54 Trademarks . . . .57 6. 14. .25 — 1. . . . . . .01 514. .96 — — 9. . .00 — 39. . . . . . .29 Leasehold land .96 1. . . .71 Plant and machinery . .59 9. 1. . . . . . . .04 26. . 467. . . . . .29 30. .26 26. . . . .50 1. . March 31. . . . . . . . 450.39 3. . . . . .64 — 84. .54 — 27. . .71 1. .93 54.50 4. .59 3. . . .08 5.73 1. .81 2.58 15. .93 — — — — — — — 84. .52 20.50 — 21. .72 12. . . . .81 10. . . . .28 Furniture and fixtures . . . .96 8. . . 54. . . . 2006 . March 31. . Schedules Forming Part of Consolidated Balance Sheet as at March 31. .79 3. . . 2006 (Amount INR Million) SCHEDULE 6—FIXED ASSETS Gross Block Depreciation and Amortisation Impairment Net Block As at As at As at For As at As at For As at As at As at July 1. . .34 — 14. .96 39. .79 0.81 39.35 26. . . . . .49 — 9. .46 1. .57 0. . . .50 against recovery of dues and is held for disposal. Particulars 2006 Additions Deletions 2007 2006 period Deletions 2007 2006 period 2007 2007 2006 Freehold land* . .11 5. .20 — 5. . . . . . . . .95 Vehicles . .49 Total . .91 — — — 8.00 997. . . . . . .00 855. .93 5. . . . . . .09 1.00 against recovery of dues and is held for disposal. . .64 0. . . . . . . .84 60. . . 36.42 121.50 — — 14. . . .98 Building# . .45 180. . . .72 271. . . . . .50 371. . . . July 1. . .09 18. 7. . . . 2007 and March 31.45 193. . . . . . 24. . . .46 0. .

.25 3.61 — 55. .88 1. . . .50 — 7.35 2.34 784. .59 0. .11 76. . .11 4. . . . . 2005 . 403. . . . .69 Trademarks . . . . . . . 803. . . . .18 — 24.37 14.210 1. . . .35 As at June 30.90 132. For the March 31. .59 — — 7. . . . . .90 Furniture and fixtures . . . .00 39. . . . . July 1.003. .00 784. . .25 19. .96 6.98 0. .07 Goodwill arising on consolidation .06 — 0. 9. . . . 25. . . . .79 180. . . . .52 1.22 12. . . . . . . . .55 39. Particulars 2005 Additions Deletions 2006 2005 period Deletions 2006 2005 period 2006 2006 2005 Freehold land* . . . . . .06 Leasehold land .35 6. . .45 39.55 — 39. .34 — 14.90 — 436.04 — 1. . .93 2. . . . July 1. . . . . . 31.83 32.25 — 1. . . . . 2006 (Amount INR Million) SCHEDULE 6—FIXED ASSETS Gross Block Depreciation and Amortisation Impairment Net Block As at As at As at As at As at As at As at As at July 1. . .21 — — 14. . . March 31. .31 1. . .88 344. . .05 95. .03 6. . . . .50 — 21. . . . . . .21 3. . . .59 45. .14 15. . . .34 2. . 7.47 180. . .52 — 0.79 18. . . . . . . . . . . . . .34 366.31 2. . . . .47 — 28.25 1. .56 — — — 3.003. . . .72 8. . .06 2. .18 1. . . . . . .17 — 5. 32. . . .43 40. . .05 0.48 4. . .98 3.48 1.37 205. . . . . .43 3.59 22.16 1. .00 — 39. .72 23. .70 21. . .22 48. . . 404. .69 31. . . .98 — — — 1. . . . . . .96 — — 9.31 — — — 9.92 0. . . . . . .00 831. . . . . June 30. .95 1. Schedules Forming Part of Consolidated Balance Sheet as at March 31.78 0. . . .15 444. .90 90. . 2007 and March 31. . . . . . . . .59 Plant and machinery . .76 9. .50 326. . .17 — 4. . . . (Also refer note under schedule 9) .04 6. . . . . . .14 1. . . . . .86 18. . . . . .23 36. .52 Vehicles .24 — — — — — — — 54. For the March 31. .24 52. . . . . . 23.35 * Includes land acquired from customer at agreed value of Rs 1. .83 0. . . . . . .84 8. . . .35 — 0. .52 18. .91 305. .10 Dies and moulds . . . . . . .21 — 25.83 18. . . .85 Office equipments . .00 against recovery of dues and is held for disposal.90 11. . . . . 14. . . 1. .34 0. . . . . .088. 52. .35 23. . . . . . . .10 5.18 — 54.20 4. March 31. .09 Building . .48 184 Total .46 0.03 218.80 0. .

. . 19. .25 15. . . 2006—Rs 70. 2006 (Amount INR Million) As at As at As at As at Face Number of March 31. . . . . . . Schedules Forming Part of Consolidated Balance Sheet as at March 31. . .25) Total 9. . . . . . .31 Stores and spare parts . 10. . . . . 2 658. . . . . . . .14 Tata Motors Ltd . . . . . . . June 30. . . June 30. . . . . . . . . . . . . . . . . . . . 5 400 — — — 0. . . .16 Market value of quoted shares . . . . . . . . . March 31. . . . as at March 31. . . 2007 and March 31. .00) (63. .85 71. . . . .37 MTNL . . . . . .500 — — — 1. . . .54 185 . . . .60 252. . . . . . . . . . the management had recognised the dimunition in value to be other than temporary and has provided Rs.04 as at March 31. . . . . . . . . . . . . Value Shares 2007 2006 2006 2005 SCHEDULE 7 INVESTMENTS (Long term. . . .00) (61. . . . . . . 10 3. . 0. . . . . . . 10 27. . . . . 2 500 — — — 0. . . . . . . .80 9. . . .04) . at cost) Non Trade Investments (Quoted) Investment in Shares Contech Soft Limited .03 72. . . . . . 0. .54 Shri Adhikari Brothers Ltd # . . . . . 2007—Rs 70.16 9. .26 198. . . .90 9. . . 1 2.65 107. .58 7. .500 — — — 1.10 Finished goods (including goods in-transit as at March 31.00) (63. . . . . . . . . 2006—Rs 10. . .16 18. . .06 300. on evaluation of its investment in SAB.000 — — — 0. . . . . . . .18 1. . . . . 60. . .85 70. . . During the previous year. . . . . . . . . . . . . . .70 90. . . .03 11. . . . . . . . .13 0. .86 Punjab Tractor . . . . . . . . . . . 2006—Rs 0. . . 2006—Rs 11. 2007 2006 2006 2005 SCHEDULE 8 INVENTORIES Raw and packing materials (including goods in-transit as at March 31. . .24. . . . .54 Share of Joint Venture .60 252. .86 90.000 — — — 2. . . . .91 118. . . . . . 10. . . . . . .194 70. . . . . . . . . .000 — — — 0. . . As at As at As at As at March 31. .18 1. . . . . .04). . .32 Wipro Ltd . . . . . . . . . . . 125. . . .85 70.03 9.18 1. . . . June 30. . . . .28 Less: Provision for dimunition in the value of investments . .17 19. . . . .21 106. . . . . . . .49) . . . . . . .13 Total 9. . . . . . . . . . . . . .03 72. . . 144. . . . The management has in past considered this investment as strategic and long term in nature. . . . .000 — — — 1. . . . .03 81. . 2 300 — — — 0. . . . 9. June 30. . . . . . . . . . . . . The market value of SAB over past few years has been substantially lower (as at March 31.96 8. . . . .76 — — — 300.88 16. . 2007 the market value was Rs. 10 27.02 249.03 National Saving Certificates .07 Work in progress .16 11. . . . . . . .78 249. .18 120. .31 Sab Nife Power Ltd . .85) in the equity shares of Shri Adhikari Brothers Limited (SAB).13 0. . .73 * The Company has an investment as at March 31. . . . . . . . .26 10 8. . . 2007— Rs 24. .13 0. . . . .03 18. . . . . .500 1. . March 31.43 as at March 31. . . . . .18 Infosys Technologies Ltd . . . . . . .00 million. . . . . .46 9. . (63. . . .09 Satyam Computers Ltd . . . . . . . 10 5. . . 2007—Rs 1.85 (as at March 31.71 Zee Telefilm Ltd . . . .06 10. .50 Sub Total 72. . . .26 198. 10 2. .

. .26 (as at March 31. . . . . . . . .19 334. .42 per share on October 1.17) (4. . . . . . . considered good Outstanding for more than six months* . .44 1. . . 599. . . . . . . . . .01 281. . . . . . . . . .56 1. . . 2007—Rs 15.17 4. . .00) 614. . .58 Less: Provision for doubtful debts . .10 629. . .78) (2. .89 334. . . .10 1. .45 81. . . . . 2006 (Amount INR Million) As at As at As at As at March 31.14 319. . . . .00 Less: Provision for doubtful debts . . . . . . .61 1. 2007— Rs 13. .60 Share of Joint Venture . .58) 2. .07) from a customer with whom transactions has been discontinued. . . . .21 334. . . . . .11 1. . .44 — Considered doubtful .194. . . . 354. . .99 (as at March 31. . . . . . . . . . . . . 0. 2006—Rs 13. . . . . . . . .81 2. . . Of the total outstanding. . . . . . June 30. . . . .19 334. Considered good . . . .71 296. . . .05 847. . .277. . . .50 — — — 690. . . . .26 13. June 30. . .27 1.31 0. . . . . .67 1. . .656. . . . . 2007 2006 2006 2005 SCHEDULE 9 SUNDRY DEBTORS Secured. . . . .60 * Deposit includes as at March 31. . . . . . . 1. March 31. .26) is considered as secured against the market value of land acquired from the customer. .81 2. . . . . . . . Schedules Forming Part of Consolidated Balance Sheet as at March 31. . . . . . . . . . . . . . . . . .94 Balance with scheduled banks—Current account . 2003.307. . . . . . . .48 1. . . . — — — 30. . .54 49. . . . . . . . . . 2006—Rs. 13. 614. . .26 0. . . . .14 319. . . . . . .99) unutilised out of issue of 2% Fully Convertible Debentures converted into 1. . .31) (0.07 (as at March 31.17 892.10 Considered doubtful . 2. . — — — (30. . . . .44 1. . . . . . . . . . .48 1. . . . . . . . . . . . .37 —Deposit account * . 89. . . . . . . . . . .10 * Sundry debtors include receivables as at March 31. . (1. . . .26 13. . . .307. .29 690. . . 2006—Rs 15.78 2.44 — b) Other debts. . .256. . . . . . . . .01 281. . . . .86 44. . .17 892. . 1. . . . . . . 2007—Rs 384. . as at March 31. . . . . . 2007 and March 31. .26 — Unsecured a) Outstanding for more than six months Considered good* . . . . . . . Management has filed litigation against the party. . . . . . . . . . . . . . .277. . . . . (Refer note under schedule 6) SCHEDULE 10 CASH AND BANK BALANCES Cash in hand . 186 . . . . . . .880 equity shares of Rs 10 each at a premium of Rs 572. . . . . . . . . . . . . . .

Schedules Forming Part of Consolidated Balance Sheet as at March 31, 2007 And March 31, 2006
(Amount INR Million)

As at As at As at As at
March 31, June 30, March 31, June 30,
2007 2006 2006 2005

SCHEDULE 11
LOANS AND ADVANCES
Unsecured, considered good
Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.27 13.55 13.47 11.47
Advances recoverable in cash or in kind . . . . . . . . . . . . . . . . . . . . . . . . 30.47 20.99 21.04 10.95
Quantity discount receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.13 5.52 5.05 5.05
Advance to suppliers (refer note 6 in schedule 22) . . . . . . . . . . . . . . . . 63.06 47.99 60.43 144.76
Balance with excise / statutory authorities . . . . . . . . . . . . . . . . . . . . . . 25.82 13.72 24.22 17.78
Staff loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.02 4.35 4.16 4.19
Advance tax (net of provisions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.68 0.01 19.15 4.96
157.45 106.13 147.52 199.16
Unsecured and considered doubtful
Advance to suppliers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.51 4.33 4.38 31.33
Loans to employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — 0.81
Less: Provision for doubtful advances . . . . . . . . . . . . . . . . . . . . . . . . . . (5.51) (4.33) (4.38) (32.14)
157.45 106.13 147.52 199.16
Share of Joint Venture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.55 — — —
158.00 106.13 147.52 199.16

SCHEDULE 12
CURRENT LIABILITIES
Sundry creditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109.87 59.76 75.25 77.36
Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 270.93 163.49 185.98 143.13
Security deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.82 5.03 5.03 5.06
Advances from customers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.21 12.50 16.42 11.54
399.83 240.78 282.68 237.09
Share of Joint Venture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.47 — — —
400.30 240.78 282.68 237.09

SCHEDULE 13
PROVISIONS
Proposed dividend . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 18.14 — 10.89
Dividend tax on proposed dividend . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 2.54 — 1.53
Provision for gratuity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35.56 25.89 25.34 22.52
Provision for leave encashment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.73 6.31 10.00 3.89
Provision for wealth tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.43 0.43 0.33 0.11
Provision for income tax (net of advance tax) . . . . . . . . . . . . . . . . . . . . — 7.55 — —
Provision for fringe benefit tax (net of advance tax) . . . . . . . . . . . . . . . 0.74 1.50 — 1.80
50.46 62.36 35.67 40.74

SCHEDULE 14
MISCELLANEOUS EXPENDITURE (to the extent not written off or adjusted)
Miscellaneous Expenditure
Software development expenses
Balance, beginning of the period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — 1.10
Less: Written off during the period . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — (1.10)
— — — —
Share of Joint Venture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15 — — —
0.15 — — —

187

Schedules Forming Part of the consolidated Profit and Loss Account
For the nine months period ended March 31, 2007 and March 31, 2006
(Amount INR Million)

July 1, 2006 to July 1, 2005 to
March 31, 2007 March 31, 2006
SCHEDULE 15
OTHER INCOME
Dividend received . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.08 0.09
Interest on fixed deposit (tax deducted at source—Rs 17.90, 2006—Rs 13.67) . . . . . . . . . . . . . . . . . . . . 61.90 50.78
Export incentives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.43 2.16
Processing income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 7.25
Profit on sale of investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 6.96
Excess provision written back . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 10.42
Sales tax incentives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.83 9.62
Credit balances written back . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 3.27
Miscellaneous income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.06 5.02
Bad debts recovered . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26.51 —
102.81 95.57

SCHEDULE 16
MATERIAL COSTS
Raw and packing materials consumed
Opening stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107.24 90.40
Add: Cost of purchases (including freight, net of freight subsidy of Rs 3.45, 2006—Rs 2.59) . . . . . . . . 550.23 439.20
657.47 529.60
Less: Closing stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125.65 106.70
Sub-total (A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 531.82 422.90
Cost of trading goods
Opening stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72.67 42.52
Add: Cost of purchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 881.49 681.73
954.16 724.25
Less: Closing stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95.91 68.77
Sub-total (B) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 858.25 655.48
Provision for free products under sales promotions scheme . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53.93 —
Sub-total (C) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53.93 —
Total (A+B+C) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,444.00 1,078.38
Share of Joint Venture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.54 —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,447.54 1,078.38

SCHEDULE 17
(INCREASE) / DECREASE IN INVENTORIES
Closing stock
Finished goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49.00 52.07
Work in progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.58 8.90
58.58 60.97
Opening stock
Finished goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45.51 47.76
Work in progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.96 9.10
53.47 56.86
Sub-total (A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (5.11) (4.11)
(Increase) / decrease in excise duty
Excise duty on closing stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.18 3.09
Excise duty on opening stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.10 4.91
Sub-total (B) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.92 1.82
Total (A+B) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4.19) (2.29)

SCHEDULE 18
EMPLOYEE COSTS
Salaries, wages and bonus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 216.60 165.65
Contribution to provident and other funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.61 13.69
Gratuity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.34 3.60
Staff welfare expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.10 26.51
Directors’ remuneration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.16 16.77
Commission to directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.72 3.03
Field Staff Incentives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.18 22.12
303.71 251.37

188

Schedules Forming Part of the consolidated Profit and Loss Account
For the nine months period ended March 31, 2007 and March 31, 2006
(Amount INR Million)

July 1, 2006 to July 1, 2005 to
March 31, 2007 March 31, 2006

SCHEDULE 19
OTHER EXPENSES
Conversion charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.59 6.08
Power and fuel expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48.33 35.65
Rent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.52 9.57
Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.07 1.21
Repairs and maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—Building . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.66 2.83
—Plant and machinery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35.24 13.42
—Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.33 4.62
Research and development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.29 0.72
Printing and stationery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.27 2.65
Communication costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.06 6.66
Legal and professional fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29.08 42.95
Rates and taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27.42 39.32
Directors’ sitting fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 0.07
Vehicle maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.42 5.15
Donation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.29 0.29
Loss on discarded/sale of fixed assets, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.80 1.30
Provision for doubtful debts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.53 0.46
Provision for doubtful advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.81 —
Provision for dimunition in value of investments . . . . . . . . . . . . . . . . . . . . . . . . . . — 0.43
Sundry advances written off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 4.61
Bad debts written off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 75.00
Exchange loss, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.51 0.10
Advertisement and publicity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 225.48 227.93
Sales promotion and schemes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48.70 8.41
Carriage outwards (net of subsidy Rs 2.99, 2006—Rs 0.65) . . . . . . . . . . . . . . . . . . 52.77 37.38
Field staff expenses and awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51.84 31.16
Traveling and conveyance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.25 13.54
Brokerage on sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.34 5.80
Miscellaneous expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.80 21.64
610.40 598.95
Share of Joint Venture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.28 —
611.68 598.95

SCHEDULE 20
INTEREST AND FINANCE CHARGES
Interest on loans from banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.77 0.15
Bank charges and commission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.31 0.89
2.08 1.04

189

Schedules Forming Part of the consolidated Balance Sheet as at
March 31, 2007 and March 31, 2006
(Amount INR Million)

As at As at As at As at
March 31, June 30, March 31, June 30,
2007 2006 2006 2005

SCHEDULE 21
CONTINGENT LIABILITIES
Contingent liabilities not provided for in respect of:
(i) Amount outstanding in respect of guarantees given by the Company
to banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.00 2.95 2.82 2.67
(ii) Tax matters
(a) Disputed liability in respect of income-tax demands —matters
under appeal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.65 1.65 1.65 2.17
(b) Disputed sales tax demands –matters under appeal . . . . . . . . . 34.79 21.67 22.23 2.51
(c) Disputed excise duty and service tax demand -matter under
appeal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.80 0.43 280.00 1.85
(iii) Claims against the Company not acknowledged as debt . . . . . . . . . 12.00 12.00 12.00 —
54.24 38.70 318.70 9.20

(This space has been intentionally left blank)

190

SCHEDULE 22—NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE NINE MONTHS PERIOD ENDED MARCH 31, 2007 AND MARCH 31, 2006
(All amounts in million of Indian Rupees)

1 BACKGROUND
Jyothy Laboratories Limited (‘JLL’ or ‘the Company’) together with its wholly owned subsidiary Sri Sai
Homecare Products (P) Ltd (‘SSHPL’ or ‘ the subsidiary’ ) and the joint venture company Balaji Telebrands
Ltd., collectively referred to as ‘the Group’, is principally engaged in manufacturing and marketing of
soaps, detergents, mosquito coils and incense sticks.

As per the agreement dated February 19, 2002, JLL acquired management control in SSHPL on
February 15, 2002. However, the equity holding of 10,39,550 Equity shares representing 100 % of the
issued share capital of SSHPL was acquired on September 28, 2002.

2 BASIS OF PREPARATION OF FINANCIAL STATEMENTS
The financial statements of the Group are prepared under the historical cost convention on accrual basis of
accounting, and in accordance with the mandatory accounting standards issued by the Institute of Chartered
Accountants of India and referred to in Section 211(3C) of the Act and generally accepted accounting
principles in India.

The consolidated financial statements of the Group have been consolidated on a line-by-line basis by adding
together the book values of like items of assets, liabilities, income and expenses, after eliminating intra-
group balances and the unrealised profits / losses on intra-group transactions.

3 SUMMARY OF ACCOUNTING POLICIES
The significant accounting policies adopted by the Group, in respect of the consolidated financial statements
are as follows:

a) Fixed assets
Fixed assets are stated at cost, less accumulated depreciation and impairment losses if any. Cost comprises
the purchase price and any attributable cost of bringing the asset to its working condition for its intended
use. Cost of shares of Co-operative society has been added to the cost of office building. Borrowing costs
relating to acquisition of fixed assets which takes substantial period of time to get ready for its intended use
are also included to the extent they relate to the period till such assets are ready to be put to use.

b) Depreciation
Depreciation is provided using the Straight Line Method as per the useful lives of the assets estimated by the
management, or at the rates prescribed under schedule XIV of the Companies Act, 1956 whichever is
higher.

191

SCHEDULE 22—NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
FOR THE NINE MONTHS PERIOD ENDED MARCH 31, 2007 AND MARCH 31, 2006

The estimated useful life of the assets is as follows:

Category Estimated useful life (in years)
Buildings 30-60
Plant and machinery 3-21
Electrical installations 20
Furniture and fixtures 12
Dies and moulds 1-3
Computers 6
Office equipments 20
Vehicles 8-10
Trademarks 9

Leasehold land is amortised over the period of the lease on a straight-line basis.

c) Impairment
i. The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of
impairment based on internal / external factors. An impairment loss is recognized wherever the carrying
amount of an asset exceed its recoverable amount. The recoverable amount is the greater of the assets
net selling price and value in use. In assessing value in use, the estimated future cash flows are
discounted to their present value at the weighted average cost of capital.
ii. After impairment, depreciation is provided on the revised carrying amount of the assets over its
remaining useful life.
iii. A previously recognized impairment loss is increased or reversed depending on changes in
circumstances. However the carrying value after reversal is not increased beyond the carrying value that
would have prevailed by charging usual depreciation if there was no impairment.

d) Operating Leases
Lease payments on operating leases are recognized as expense on a straight-line basis, over the lease term.

e) Government grants and subsidies
Grants and subsidies from the government are recognized when there is reasonable assurance that the grant/
subsidy will be received and all attaching conditions will be complied with.

When the grant or subsidy relates to an expense item, it is recognized as income over the periods necessary to
match them on a systematic basis to the costs, which it is intended to compensate. Where the grant or subsidy
relates to an asset, its value is deducted in arriving at the carrying amount of the related asset.

f) Investment
Long term investments are stated at cost. Provision, where necessary, is made to recognize a diminution, other
than temporary, in the value of investments.

g) Interest in Joint Venture
Interest in jointly controlled entities (incorporated joint venture) are accounted for using proportionate
consolidation method

h) Inventories
Inventories of raw materials, packing materials, work-in-progress, finished goods, stores and consumables items
are valued at cost or net realizable value, whichever is lower. Cost is ascertained on First-in-First out (‘FIFO’)

192

are recognised as income or as expenses in the year in which they arise. 2004 are added to the cost of such assets in line with Old Accounting Standard 11 (1994). or reported in previous financial statements. 2007 AND MARCH 31. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. Software development expenses are amortised over a period of three years. 2006 basis and includes all applicable costs incurred in bringing goods to their present location and condition. Deferred income taxes reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years. The Company accrues for excise duty liability in respect of manufactured finished goods/intermediary inventories lying in the factory. Interest Revenue is recognised on a time proportion basis taking into account the amount outstanding and the rate applicable. deferred and fringe benefit tax. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction. l) Income-tax Tax expense comprises of current. Exchange differences arising in respect of fixed assets acquired from outside India are capitalized as a part of fixed asset. Sale of Goods Revenue is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer. (iii) Exchange Differences Exchange differences arising on the settlement of monetary items or on reporting company’s monetary items at rates different from those at which they were initially recorded during the year. Exchange differences on liability relating to fixed assets acquired within India arising out of transactions entered on or before March 31. Current income tax and fringe benefit tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act. If the company has 193 . and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined. i) Revenue recognition Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Sales Tax and VAT deducted from turnover (gross) is the amount that is included in the amount of turnover (gross) and not the entire amount of liability arise during the year. Cost of work in progress and finished goods includes materials and all applicable manufacturing overheads. k) Foreign currency translation (i) Initial Recognition Foreign currency transactions are recorded in the reporting currency. Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction. Excise Duty. SCHEDULE 22—NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS—(Continued) FOR THE NINE MONTHS PERIOD ENDED MARCH 31. (ii) Conversion Foreign currency monetary items are reported using the closing rate. j) Miscellaneous Expenditure Miscellaneous expenditure comprise