Annual Report - Jyothy Laboratories - 2009-2010

JYOTHY LABORATORIES LIMITED

ANNUAL REPORT 2009-2010

DIRECTOR'S REPORT

To,
The Members,

Your Board of Directors is pleased to present the Nineteenth Annual Report
together with the Audited Financial Statements for the year ended March 31,
2010 compared with previous period (July 1, 2008 to March 31, 2009) as
follows:



(Rs. in lacs)
Financial results Financial year ended
March 31, 2010 March 31, 2009
(12 Months) (9 Months)

Sales (net of trade discount) 62,622.66 38,416.86

Other Income 1,818.78 774.60

Profit before depreciation and 11,212.93 5,775.28
interest

Interest & Finance Charges 61.16 36.63

Depreciation, Amortization & 1,046.30 681.24
Impairment

Profit before tax 10,105.47 5,057.41

Provision for tax:

- Current tax 1,860.00 707.76

- Deferred tax charge 259.59 189.84

- Fringe benefit tax 0.00 72.00

- (Excess) / Short provision for (18.82) 77.29
current tax of earlier year

Profit after tax 8,004.70 4,010.52

Balance as per the last Balance
Sheet:

- Brought forward 904.46 591.98

- Balance available for appropriations 8,909.16 4,602.50

Appropriations:

Final Dividend on Equity Shares 2,902.75 1,451.38

Corp. Dividend Tax 482.11 246.66

Transfer to General Reserve 4,000.00 2,000.00

Balance Carried Forward (Profit & 1,524.30 904.46
Loss A/c)

* Earning Per Share (for 12 months 11.03 5.53
in the current financial year and
for 9 months for the previous
financial period)

* Dividend Per Share (for 12 months 4.00 2.00
in the current financial year and
for 9 months for the previous
financial period)

* (Based on Face Value of Re.1/- per Equity Share)

Change in the financial year:

As you are aware, the Company had changed its financial year to end on
March 31 to coincide the accounting year of the Company with the
conventional financial year to enhance comparability with other companies.
Accordingly, the previous accounting period was for nine months period from
July 1, 2008 to March 31, 2009. Therefore, the attached financials which
have been prepared for twelve month period/accounting year (April 1, 2009
to March 31, 2010), are not comparable with the previous period reporting
which had been for nine month period i.e. July 1, 2008 to March 31, 2009.

Performance:

During the financial year ended March 31, 2010, the Company recorded Sales
(net of trade discount) at Rs. 62,622.66 lacs compared to Rs. 38,416.86
lacs in the previous 9-month financial period. In the financial year under
review, Profit before Tax stood at Rs. 10,105.47 lacs compared to Rs.
5,057.41 lacs in previous 9-month financial period.

On a like to like basis the Sales (net of trade discount) in Financial Year
under review had grown by 27.5% compared to corresponding previous twelve-
months. The Sales (net of trade discount) and Profit before tax of the two
periods compare as follows:

(Rs. in lacs)

Particulars April 09 - April 08 - %
March 10 March 09 Growth
(Audited) (Audited)

Sales (net of trade 62,622.66 49,119.68 27.5%
discount)

Profit before tax 10,105.47 7,297.22 38.5%

The Company has performed very well both in terms of growth in sales and
profitability. With signs of receding food inflation and hope of better
weather conditions, launch of new products, leveraging and extention of
existing brands both in product range and pan-India launches and
acquisition of new technology in mosquito repellents should see your
Company achieve still better growth in the coming years.

Dividend:

For the financial year under review, the Board is pleased to recommend a
dividend @ Rs. 4 per equity share of face value of Re.1/- each, (i.e. 400%
of face Value of Equity Shares), aggregating to Rs. 2,902.75 lacs. In the
previous financial period (9 Months), July 2008-March 2009, the Board had
recommended and paid a dividend @ Rs. 2.00 per equity share of face value
of Re. 1/- each, (i.e. 200% of face Value of Equity Share), aggregating to
Rs. 1,451.38 lacs.

The dividend will be paid to eligible members after its approval by the
Members in Annual General Meeting.

Finance:

The Company continues to remain debt-free. The cash and bank balances as on
March 31, 2010 amount to Rs.12,117.47 lacs.

New developments Fabric care:

- The Company has planned Brand extension to take Ujala detergent to other
states in a phased manner. We are in Kerala since 2003 and achieved a
significant market share in mid-segment.

- Signed up with Sachin Tendulkar as Brand Ambassador for UJALA brand.

Household Insecticide:

- The Company is expanding its reach through new products. In November,
2009, the Company bought technology DEPA, a repellent formulation for
protection from all blood sucking insects and mosquitos from (Defence
Research and Development Organisation), Ministry of Defence, Government of
India which allows the Company to manufacture and market the products in
India including to armed forces, and to many countries abroad. The
repellent cream and wipers are in the process of being launched.

- To promote the products in this category, the Company launched a new
media campaign and packaging for the brand 'MAXO' - 'Raat Achhi To Din
Achha' which caught fancy of the viewers and has been very successful.

- e mosquito repellent coil manufacturing unit in fiscal incentive area of
Jammu went into full scale production during this fiscal year. This
manufacturing unit is equipped with the most updated technology in coil
manufacturing.
Surface Cleaning:

- The Company achieved 24% market share in southern India and has launched
the product at all India level in the last quarter of the financial year.
The products in this category namely dishwash bar, liquid and scrubbers
have penetrated into all major cities in India.

Management Discussion & Analysis Report:

Management Discussion & Analysis Report is attached and forms part of this
Directors Report.

Corporate Governance:

As per Clause 49 of the Listing Agreement with the stock exchanges, a
Section on Corporate Governance is presented separately and forms part of
this Report.

Subsidiary Companies:

The Central Government has vide its letter No. 47/4/2010 - Cl. III dated
26.03.2010 exempted the Company from attaching Annual Accounts and other
documents in respect of its four subsidiaries to the Annual Report of the
Company for the year ended March 31, 2010. As required vide above letter,
statement in respect of each of the subsidiary, giving the details of
capital, reserves, total assets and liabilities, details of investments,
turnover, profit before taxation and proposed dividend is attached to the
Consolidated Balance Sheet. Annual Accounts of the subsidiary companies and
the related detailed information will be made available to the shareholders
of the Company, seeking such information and will also be available for
inspection at the Registered Office of the Company.

Jyothy Fabricare Services Limited:

Members are aware that the Company had started a new Value Added Service in
fabric care segment to provide 'World-class laundry at affordable price at
your door step' and other related services through its subsidiary company
namely Jyothy Fabricare Services Limited (JFSL)'. JFSL is providing fabric
care services under various brands namely JFSL Corporate, Fabric Spa, JFSL
rentals, Fabric Spa busy easy and Snoways.

A world-class facility equipped with world-class machinery and equipments,
most updated technology, supported by a robust IT structure and housed in
an area of 70,000 square feet built on 2 acres of land at Doddaballapur,
near Bangalore, Karnataka, became operational in November 2009. The Company
had earlier launched 'Snoways' chain of laundry through acquisition of 8
retail outlets which have now grown to 30. 'Fabric Spa' a premium brand was
launched on November 9, 2009 in Bangalore. Response so far from consumers
is very encouraging.

During the year under report, Snoways Laundrers & Drycleaners Private
Limited (Snoways) became an associate company of Jyothy Fabricare Services
Limited.

Amalgamation:

Your Directors have proposed amalgamation of Sri Sai Homecare Products
Private Limited, a wholly-owned subsidiary company with the Company with
effect from April 1, 2010.

Employee Relations:

Employee relations remained cordial during the year under review.

Fixed Deposits:

The Company did not take any fixed deposits from the public and no fixed
deposits were outstanding or unclaimed as on March 31, 2010.

Directors:

In accordance with the requirements of the Companies Act, 1956, and the
Articles of Association of the Company, Mr. Nilesh B. Mehta and Ms. M. R.
Jyothy, Directors of the Company are due to retire by rotation at the
ensuing Annual General Meeting of the Company and being eligible have
offered themselves for re-appointment. The Board recommends their re-
appointment.

Auditors:

M/s. S. R. Batliboi & Associates, Chartered Accountants, Mumbai, Statutory
Auditors of the Company, continue to hold office until conclusion of the
Nineteenth Annual General Meeting and being eligible offer themselves for
re-appointment.

A certificate has been received from the Auditors to the effect that their
appointment, if made, would be within the limits prescribed under Section
224 (1B) of the Companies Act, 1956. The Auditors have advised that they
have subjected themselves to the peer review process of the Institute of
Chartered Accountants of India (ICAI) and hold a valid certificate issued
by the Peer Review Board of the ICAI.

Directors' Responsibility Statement:

Pursuant to requirements of Section 217(2AA) of the Companies Act, 1956,
your Directors confirm that:

1. in the preparation of the annual accounts for the financial year ended
March 31, 2010, the applicable accounting standards have been followed;

2. the Directors have selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of the
Company as at March 31, 2010 and of the Profit of the Company for the
financial year ended on that date;

3. the Directors have taken proper and sufficient care in the maintenance
of adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;

4. the Directors have prepared the annual accounts for the financial year
ended March 31, 2010 on a going concern' basis.

Consolidated Financial Statements:

In accordance with Accounting Standard 21, issued by the Institute of
Chartered Accountants of India, Consolidated Financial Statements have been
provided in the Annual Report. These Consolidated Financial Reports provide
financial information about your Company and its subsidiaries as a single
economic entity. The Consolidated Financial Statements form part of this
Annual Report.

Conservation of Energy & Technology Absorption:

With regard to the requirements of Section 217(1)(e) of the Companies Act,
1956, read with the Companies (Disclosure of Particulars in the Report of
the Board of Directors) Rules, 1988, the Company has nothing specific to
report.

Foreign Exchange Earnings and Outgo:

(Rs. in lacs)
Particulars 2009-10 2008-09
(12 Months) (9 Months)

Foreign exchange earnings 732.42 465.45
Foreign exchange outgo 590.89 193.81

Particulars of Employees:

Particulars of employees as required under Section 217(2A) of the Companies
Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975,
as amended and forming part of the Directors' Report for the year ended
March 31, 2010 are not attached to this report as permitted under the
provisions of Section 219(1)(b) (iv) of the Companies Act, 1956. Members
interested in obtaining the said information may write to the Company
Secretary at the registered office of the Company.

Risk and Concerns:

Indian Economy has been on growth track again. The growth is expected to
accelerate during the current year. However, excess liquidity and inflation
induced by supply constraints and anxiety about the eventual and timing of
withdrawal of stimulus continue to cause concern. The Company had reported
good growth in 2008-09 as well as in 2009-10.

We believe that the Company operates in certain segments of FMCG space
where demand for the Company's products is driven more by needs and may be
impacted more by weather conditions and colour trends in wearing apparels.
To some extent, the Company is protected from pressures like slow down of
economy due to small unit values of consumer packs of its products. The
Company continues to promote usage of white apparels, widen its products
range, introducing new variants of its products, brand extensions, create
awareness and communicate utility value of its products to consumers
through mass media advertisements and increasing geographical reach of its
products.

The Company had been able to hold the price line during the year under
review. However, any increase in prices of crude oil especially like those
experienced in 2008-09 may impact the performance as your Company is a
large consumer of HDPE and Labsa which are used for manufacture of
containers and detergents, as their prices are closely linked to
international prices of crude oil. Such cost increases could impact the
profitability of the Company to the extent that it fails to neutralize the
increased cost by matching increase in prices. The Company would continue
to try to protect profitability by containing cost increases through
greater efficiency in operation and judicious increase in prices.

The Company is perceived to depend for Turnover and Profits on a few
products and that any adverse movement in sale or profitability of such
products may compromise its performance. The Company is alive to the matter
and has been continuously extending its products range and geographical
reach within India and squeezing cost through greater operational
efficiency without any compromise in quality.

The Management continues to monitor the risks concerning the Company and
take actions as appropriate to the situation.

Internal Control Systems and its Adequacy:

The Company has adequate internal control systems and procedures in place
for effective and smooth conduct of business and to meet exigencies of
operation and growth. The key business processes have been documented. The
transactions are recorded and reported in conformity with generally
accepted accounting practices. The internal control systems and procedures
ensure reliability of financial reporting, compliance with the Company's
policies and practices, governmental regulations and statutes. Internal
Audit is conducted by independent firm of auditors. Internal Auditors
regularly check the adequacy of the system, their observations are reviewed
by the management and remedial measures, as necessary, are taken.

Cautionary Note:

Certain statements in the 'Management discussion and Analysis' section may
be forward-looking'. Such forward-looking' statements are subject to
risks and uncertainties and therefore actual results could be different
from what the Directors envisage in terms of future performance and
outlook.

Acknowledgement:

The Board of Directors express their sincere appreciation for the
contribution and commitment of the employees of the Company and for the
excellent support provided by the shareholders, customers, distributors,
suppliers, bankers, media and other service providers, during the financial
year under review.

For and on behalf of the Board of Directors
For Jyothy Laboratories Limited

M.P. Ramachandran
Chairman & Managing Director

Mumbai, May 25, 2010.

MANAGEMENT DISCUSSION AND ANALYSIS

Macro Economic Scenario:

India's GDP grew by 7.4 per cent m 2009-10 on the back of the strong
performance of the manufacturing sector and positive agricultural growth.
This good growth has come at a time of a challenging external economic
environment and the worst drought that the country has seen in nearly 4
decades as per the finance ministry.

According to a study by the Mckinsey Global Institute (MGI). Bird ot Gold':
The Rise of India's Consumer Market Indian incomes are likely to grow
three-told over the next two decades and India Is expected to become the
world's fifth largest consumer market by 2025. moving up from its 2007
position as the world's 12th largest consumer market

India ranks second In the Nielsen Global Consumer Confidence survey
released on January 7. 2010 An indication that recovery from the economic
downturn Is taster In India with consumers willing to spend more.

The Fast Moving Consumer Goods (FMCG) Industry:

According to a FICCI-Technopak report despite the economic slowdown,
India's fast moving consumer goods (FMCG) sector Is estimated to clock USD
43 billion by 2013 and USD 74 billion by 2016.

The report states that implementation of the proposed Goods and Services
Tax (GST) and the opening up of Foreign Direct Investment (FDI) are
expected to fuel growth further and raise the industry size to USD 47
billion by 2013 and USD 95 billion by 2018

The Ministry of Food Processing industries Is also planning to double the
market size of the food processing Industry to USD 165.1 billion by 2009-10
and tribbile it to USD 271 a billion by 2014-15.

Demand for personal care products such as shampoos, toothpastes and hair-
oils has registered better growth rates in rural areas than urban areas
dung April-September 2009.

A period that includes the peak monsoon months, as per the numbers released
by market researcher AC Nielsen.

The Indian FMCG Industry Is Avoided Into live primary segments - personal
care products. household care products, packaged food products, branded
spirit and tobacco products as well as health care products.

Key industry Trends & Growth Drivers:

1. Relatively Insulated from the Slowdown:

Despite the global economic downturn, the Indian economy continued to
display resilience and this Is evident m the growth numbers projected Dy
the Finance Ministry This augurs well for the FMCG sector and especially
Jyothy Labor atones which has an India centric focus.

2. Rural Demand biggest growth driver:

The rural marketing accounted for a 57 per cent share of the total FMCG
market In India.


Rural India. which accounts for more than 70 per cent of the country's one
billion population (according to the Census of India 2001). Is not just
witnessing an increase In its income hut also In consumption and
production. Further the Union Budget for 2010-11 has hiked the allocation
under the National Rural Employment Guarantee Act (NREGA) to USD 8.71
billion in 2010-11. giving a boost to the rural economy

According to a study on the Impact of the slowdown on rural markets
commissioned by the A Rural Marketing Association of India (RMAJ) and
conducted by MART, the rural economy has not been impacted by the global
economic slowdown.

- Moreover, the rural consumer market, which grew 25 per cent In 2008 when
demand in urban areas slowed due to the global recession, is expected to
reach USD 425 billion 2010-11 with 720790 million customers, according to a
white paper prepared by

- CH-Technopak. That will be double the 2004-05 market size of USD 220
billion.

- According to the study, the rural market is seeing a 15 per cent growth
rate.

3. increase in promotional and advertisement expenditure Promotional
expenses continue to remain high to FMCG companies which Is Intensely
competitive. Media reports even suggest thai the amount spend by FMCG
companies has been creating a big dent in the profitability. With the
economy shotting signs ot having revived, the advertising Industry In India
Is expecting advertising spend to show a growth of 10-13 per cent next
financial year. Also some Industry experts believe thai advertisement
expenses could go up In 2010 partly due to cost Inflation and fragmentation
of media.

4. Input Costs:

input costs play a Key role in determining the margms of FMCG Companies
With decline in Input costs and reduction In excise duty, the FMCG segment
witnessed Improved margins during die Financial Year 2009-10,

5. Volumes to be the Growth Driver:

With intense competition leaving Handy any scope ot price hikes. volumes
especially those from the rural areas Is expected to drive growth for the
FMCG sector

6. Branding:

Branding Is an Inherent aspect ot the FMCG market, given the plethora of
choices available for a consumer FMCG Companies are Increasingly spending
on branding the* products to highlight key differentiators and enhance
brand loyalty*

7. Distribution network:

The success ot FMCG companies is largely determined by the kind of
distribution network It has built over the years. It is not only Important
to have good products at the right price but easy availably and proximity
to the customer is essential.

Recent Segmental Trends & Outlook:

Most FMCG companies continued to invest in brands to maintain topline
growth and market share n a highly competitive environment. The FMCG
industry Is expected to register higher growth given the higher disposable
income led by Income tax cuts, while FMCG prices are expected to be hiked.
Prices ot dairy use products such as soaps, talcum powder shampoos etc are
expected to increase. Most FMCG compares have large manufacturing plants In
excise-free zones that are not affected by a hike or cut A excise duty,
while higher cost of production will Inevitably cause a price hike.

Volume growth, expansion of rural reach, low-priced packs and consumer-led
promotions In categories like soaps, shampoo, biscuits and packaged tea
helped the FMCG Industry post a 14% sates growth year-on-year in Apni.
according to the latest data from market researcher Nielsen.

Jyothy Laboratories Competitive Positioning:

* Focus on Rural as well as Urban Markets

* Proven Business Model In terms of growth prospects despite unfavourable
economic scenario

* Established Brand Equity and ability to successfully launch products as
brand extensions

* Engineering Focus backed by Research and Development Initiative to
enhance qty. of products and production efficiencies

* Strong Distribution network

* Strong Management Team

* Strong Balance Sheet

* Risk Addressal

* Competition: The Company knows the pulse of the consumer and has a
thorough understating of the markets It caters too. The Company's market
leadership In the segments it Is present, underlines the brand loyalty and
competitive edge n enjoys over its peers,

* Unorganised Markets: Consistency In the quality of products and the
ability to make It available at a price which is affordable has resulted in
strong brand equity for the Company among all consumer categories, It is a
trusted name In households across the country and Is available in ~ 27
million outlets in India as of March 31,2010 (Source. AC. Nielson) which
enables Company grow despite unorganized markets.

* Raw Materials Management: The strategy of entering into long term
contracts for sourcing raw materials coupled with a strong cash on Its
books has enabled the company to avail of substantial discounts thus
enhancing its profitability.

* Logics Management Damages In transit continue to the low at Jyothy
Laboratories and It Is among the lowest m the Industry. A focused approach
with clear cut processes has enabled the Company to lower its costs and
enhance productivity through one of the key functions of logistics
management in the FMCG industry.

* Recessionary Trend In the Global Economy. While most economies were
passing through a recessionary phase across the globe, the Indian economy
continues to grow at a rate which Is higher than that of most economies.
The Company's India centric approach coupled with strong know how of the
markets its caters to has enabled it to post good growth numbers despite
the grim global macro economic scenario.

FINANCIAL PERFORMANCE

Accounting policy:

The Company follows the Generally Accepted Accounting Principles (GAAP) In
India. applicable accounting standards and other necessary requirements of
the Companies Act 1956 for the preparation of its financial statements. The
Company uses accrual basis of accounting except *i cases of assets for
which provision for impairment Is made.

The Year 2009-10

Summarised Profit & Loss Statement:

(Rs. in lacs)

Particulars 12 months 12 months 9 months
ended ended ended
31 March 2010 31 March 2009 31 March 2009

Gross Sales 75046 57511 45194

Net sales 57476 45001 35154

Other income 1819 1006 775

Total Income 59295 46007 35929

Cost of Goods Sold (31277) (24256) (19822)

Employee Cost (6831) (5512) (4320)

Advertisement & Sales
Promo Expenses (3686) (2487) (1788)

Other Expenses (6288) (5526) (4223)

EBITDA 11213 8226 5776

Depreciation (1046) (889) (681)

Interest and Finance Charges (61) (40) (37)

Profit before exceptional
item and tax 10106 7297 5058

Tax (2101) (1484) (1047)

Profit aFter tax 8005 5813 4011

EPS 11.03 8.01 5.53

Book Value Per Share 54.97 48.55 48.55

Gross * Net Sales:

During the financial year under review. Gross sales at Rs. 75.046 lacs
recorded a growth of 30.5% over corresponding previous twelve month period.
At Net Sales level the growth stood at 28%. The product wise Net Sates
along with (actors contributing to growth are analysed in the Business
Review section ot this report.

Cost analysis:

Total cost (excluding Interest and depreciation) at Rs. 48.082 lacs was
higher by 27% compared to Rs. 37781 lacs In the corresponding previous
period. However the total cost as percentage ot Net Sates decreased only
marginally to 83.6% from 83.9% in the corresponding previous twelve month
period.

The Increase was primarily due to Increase in operations and rise In
promotional expenses resulting mainly from the focused advertisements for
Maxo & Exo range ot products, the benefits ot which are expected to accrue
In near future.

Cost of goods sold during the financial year increased by 28.9% to Rs.
31.277 lacs compared to Rs 24.256 lacs in corresponding previous twelve
month period. The increase was in toe with the increase in Turnover.

Employee cost fluting the financial year at Rs 6.831 lacs showed an
Increase of 24% over corresponding previous twelve month period. The
increase was on account of Increments and Incentives to sales staff.
Employee cost as a proportion of total cost remained constant at 14 % for
the period under review.

Other expenses during the financial year stood at Rs. 6.288 lacs 1.6. an
Increase of 13.8% compared to Rs. 5.526 Lacs In die corresponding previous
twelve months largely due to Increased operations resulting into Increased
absolute costs m logistics, sales and distribution However, the cost
declined from f 2.3% of Net Sates In the previous period to 10.9% during
the financial year under review.

Advertisement and Sales promotion expenses increased by 48% to Rs 3.686
lacs In 2009-10 from Rs, 2.487 lacs it me corresponding previous twelve
month period due to focused marketing campaigns launched across product
categories. Major ucrease was due to new campaign ot 'Raat Achhi. to Din
Achha* In case ot Maxo and national campaign for Exo brand.

Margins:

EBIDTA margins increased by 123 basis points from 1828% In 2008-09 to
19,51% 2009-10. This was mainly on account of reduction In raw materials
cost due to fall in crude prices and other cost control measures,

Profit after Tax increased to 13.9% In 2009-10 compared to 12.9% in the
corresponding previous twelve month period.

Taxation:

The effective tax rate Increased marginally from 20.3% In 2006-09 to 20.8%

2009-10.

Capital employed:

Total capital employed stood at Rs, 39.909 lacs as on March 31,2010. For
the 12 month year March 31,2009. It stood at Rs. 35.249 lacs. The Increase
was 13% compared to growth In business at 28%.

Own funds:

The net worth grew by 13.2% from Rs. 35.232 lacs as on March 31st. 2009 to
Rs. 39,892 lacs as on March 31st, 2010.The Book value per share stood at
Rs. 54.97 as on March 31.2010 compared to Rs. 48.55 a year ago.

Return on net worth for the financial year ended March 2010 stood at 2007%
compared to 165% for the corresponding previous period. Earning per share
(EPS) increased to Rs. 11.03 per equity share of Re. 1/- each compared to
Rs. 8.01 In the corresponding previous twelve months.

Equity:

The equity snare capital (Issued and subscribed) ot the Company consists ot
7.25.68.800 equity shares of Re. 1. each. There was no change In the paid
up snare capital of the Company during the year,

Reserves and surplus:

The reserves and surplus stood at to Rs 39.166 lacs as on March31st. 2010
compared to Rs 34.506 lacs as on March 31 st 2009. The increase was due to
retained earnings.

Loan Funds:

The Company continues to remain debt free. The unsecured debt portfolio at
Rs. 17 lacs comprises sales tax deferrals and remained constant during the
financial year.

Gross block:

The gross Hock Including Capital Work in Progress as on March 31, 2010
stood at Rs. 25.501 lacs compared to Rs. 23.438 lacs as on March 31, 2009.
The increase In gross block is largely due to expansion at Uttrakhand for
Ujala detergent and soap. Salem for Ujaia detergent and Pondicherry for
Maxo Liquid.

The Company follows Straight line method for charging depreciation as per
the rate prescribed In Schedule XW of the Companies Ad. 1956. Accumulated
Depreciation increased to Rs.5.345 lacs as on March 31, 2010 compared to
Rs.4.316 lacs as on March 31, 2009.

Net Working capital:

Net working capital stood at Rs. 19.287 lacs as on March 31.2010 compared
to Rs. 15.474 lacs as on March 31.2009

Inventory:

Inventory stood at Rs. 6.646 lacs as at March 31.2010. As at March 31.2009,
it stood at Rs 4.287 lacs. Inventory turnover stood at 78 days for 2009-10
against 65 days during the corresponding period of 2003-09.

Sundry debtors:

Sundry debtors stood at Rs 6.965 lacs as at March 31, 2010 compared to Rs.
4.239 lacs as on March 31 .2O09.There are no outstanding debtors (or
over 6 months.

Debtor turnover stood at 41 days for the year ended March 31.201 & For me
corresponding period of the previous year, the same stood at 31 days.

Cash and bank balances:

Cash and bank balances stood at Rs. 12.118 lacs as on March 31.2010 against
Rs.10.017 lacs as on March 31.2009 JU the operating level the Company
generated Rs. 5 J 01 lacs of positive cashflows for the year ended March
31.2010. Utilisation was mainly on account of advances to subsidiaries,
purchase of fixed assets and payment ot dividends during the year

Loans and advances:

Loans and advances stood at Rs, 5.057 lacs as on March 31.2010 against Rs.
3.285 lacs as on March 31.2009 due to advances offered to subsidiaries and
amount receivable from Excise department on account of claim for
differential excise duty at Jammu and Guwahati.

Current liabilities and provisions:

Current liabilities and provisions stood at Rs, 11.608 lacs as on March
2010 as against Rs. 6.382 lacs as on March 2009. This Increase was
primarily due to Increase in operations residing Into increase In month end
outstandings ot creditors and statutory payments.

Sundry creditors stood at Rs. 2372 lacs as on March 31.2010 as against Rs.
827 lacs as on March 31.2009.

Dividend:

The Board has recommended a dividend @ Rs.4/- (400%) per share for the
financial year 2009 10 against the dividend of Rs. 2/- (200%) per share
paid tor the year 2008-09