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Directors Report of Gillette India Ltd.

Jun 30, 2014

Dear Members,

The Directors have pleasure in presenting their Thirtieth (30th) Annual Report together with the Audited Accounts for the Financial Year ended June 30, 2014.

FINANCIAL RESULTS

(Figures in Rs. Crores)

2013-14 2012-13

Sales (less excise duty) 1,745.62 1,435.33

Other Operating Income 4.17 2.39

Other Income 31.62 36.55

Profit before tax & exceptional items 80.66 138.25

Profit after tax 51.42 87.16

Transfer to General Reserve 5.14 8.72

Proposed dividend plus tax thereon 57.18 57.18

Balance carried forward 278.46 302.87

DIVIDEND

Your Directors are pleased to recommend, subject to the approval of the Members, a dividend of Rs. 15/- per equity share of Rs. 10 each, amounting to Rs. 48.88 crores, for the Financial Year ended June 30, 2014.

OPERATIONS

Your Company delivered another year of robust performance in the Financial Year 2013-14, despite challenging economic conditions – particularly volatility in the Rupee and inflationary market conditions. Driven by Company''s focus on innovation and productivity, Sales for the year increased by 22 per cent to Rs. 1,746 Crore.

Profit After Tax (PAT) for the Financial Year was in line with expectations at Rs. 51 crores while Profit Before Tax stood at Rs. 81 crores. While ongoing investment in Oral-B toothpaste continued as per plan.

PERSONAL GROOMING

Gillette Personal Grooming portfolio had a strong year registering high double digit growth combined with highest-ever market share growth across Blades and Razors and Personal Care category. This was driven by strong performance across all product tiers through irresistible Product and Commercial innovations and by expanding our product offerings.

We successfully launched New Gillette Vector-3 in the Mid-Tier Blades & Razor segment during the year. The new razor comes with 3-self adjusting blades, advanced lubra-strip, easy to rinse blades and non-slip rubber grip, thus, providing consumers with a superior shaving experience.

We also expanded our Female Hair Removal (FHR) portfolio with the launch of New Gillette Venus with 3-blades and soft protective cushions, specially designed for women along with Satin Care Gel and Venus Oceana Disposables.

Our premium line of systems registered strong performance with both Mach3 and Fusion, delivering double digit growth behind strong razor placement, Go-to-Market plans and innovative marketing campaigns – Shave India, Cricket and Football activation through the Financial Year. Gillette launched the first-ever India razor to salute the undying passion of the Indian fans towards their team. The special edition razor had the word INDIA engraved on the handle as a mark of salute to the inner steel which is shared by Gillette and Indian cricket fans.

Gillette Guard, the Entry Level system, specially designed for low-income group consumers, continued to register Strong double digit growth by value and volume. Gillette Guard has demonstrated the fastest share and distribution build-up among all categories in India since its launch in October 2010.

Gillette Double edge blades continued to grow value-share primarily led by its 7-o'' clock and Wilkinson Sword brands.

In the Personal Care Category comprising of pre- shave and post-shave products, we entered the cream segment this year with the launch of the

New Gillette Shaving Cream. It helped further strengthen our position versus competition in the pre-shave category while we continued our leadership in the Gel and Foam segment, respectively.

Thus, your Company continued to grow across the portfolio through the Financial Year.

ORAL CARE

Oral-B continues to grow across all tiers. Initiatives focused on establishing superiority of Cross Action helped Oral-B grow in the super premium tier segment. Oral-B has led innovation this year launching two new technologically superior products – Top of the line manual brush called ''Pro-health Sensitive'' and ''Allrounder 5 way clean. The sensitive toothbrush market is growing at more than 30% and Allrounder-5 way clean is specifically designed and suited to the needs of the Indian market. Oral-B 123 continues to drive the premium tier by providing superior propositions to the consumers. Dedicated TV initiatives on Oral-B Shiny Clean along with strong plans to drive deeper distribution further helped strengthen Oral-B''s position in the mid- tier segment. Multiple initiatives were undertaken to expand Oral-B distribution, which resulted in the brand being available to more consumers across India.

Oral-B, which is the World''s No. 1 dentist recommended toothbrush brand, (Based on surveys of a representative worldwide sample of dentists carried out for P&G) continued its partnership with dentists across India, to promote oral health awareness for yet another year through its Oral-B Smile India Movement-4 initiative. This campaign helped in improving the lives of consumers by educating them on oral hygiene and by offering them a free dental checkup close to their residence simply on the purchase of an Oral-B toothbrush and toothpaste.

After a year of launching the Oral-B toothpaste successfully (3 tiers of toothpaste in both Gel and Paste), the Company focuses to now offer a complete Oral Care regimen with both products. The product response during the year from both

PORTABLE POWER

For the Financial Year 2013- 2014, Duracell has achieved robust sales growth due to successful price up helping in earnings improvement behind volume growth and higher pricing. Duracell has increased the scope by shifting the communication from only high drain device to everyday use devices like Torch. This has helped us to increase the scope of target audience. In the coming future, Duracell will continue to outperform the category focusing on everyday device consumers in need of superior performance, whilst continuing to service "Aspiring Indian" consumers who seek value for money from the battery.

MANUFACTURING

Your Directors have the pleasure of informing you that during the Financial Year under review, Company''s plants at Bhiwadi and Baddi continued to perform at record levels and delivered all time high throughputs and customer service. During the year, Bhiwadi and Baddi plants further improved productivity and reduced cost. Changes in the work system were successfully implemented, that would enhance long term people capability to continue to meet the business needs. The plants continued to deliver outstanding performance in all key measures such as Safety, Quality, Cost etc.

CORPORATE SOCIAL RESPONSIBILITY

Building business by improving lives P&G''s continued focus on purpose-inspired growth, drives us to not only serve our consumers with unique and superior product propositions, but also to touch and improve their lives by contributing towards the communities we operate in. This dedicated commitment is the driving force behind our Corporate Social Responsibility initiatives like ''P&G Shiksha'' and ''Project Parivartan'' that improve the lives of children from lesser privileged backgrounds, through health and education.

Over the past decade, P&G''s sustainability mantra ''to touch and improve the lives of consumers, now and for generations to come'' has inspired an enduring Corporate Social Responsibility strategy supported by three pillars – "P&G Shiksha", "The Whisper School program (Education) & Project Parivartan (Transformation") and "Timely Disaster Relief". While P&G Shiksha and Project Parivartan provide children from underprivileged backgrounds with access to basics like health and education, P&G''s disaster

relief activities aim to rehabilitate and empower the victims of natural disasters by providing them with daily essential commodities and safe drinking water.

P&G''s Project Parivartan continued its efforts in providing essential menstrual health and hygiene education to girl children across the country. Over the past year alone, the program reached out to over 3.5 million girls in schools across the country.

P&G''s signature corporate sustainability program P&G Shiksha has till date built and supported over 330 ( 110 since last year) schools across the country that will impact the lives of over 600,000 ( 180,000 since last year) children, in partnership with a number of NGOs like - Army Wives Welfare Association, Navy Wives Welfare Association, Round Table India, Save the Children, amongst others. These partners serve as specialists, lending their expertise to particular aspects of the education system. The NGO Round Table India for example is dedicated towards constructing educational infrastructure and supporting schools across India. The NGO Save the Children focuses on girl child''s education by aiding government funded programs like the Kasturba Gandhi Balika Vidhyalayas. Similarly, the NGOs Army Wives Welfare Association and Navy Wives Welfare Association are experts in serving the educational needs of disabled children.

Since its commencement in 2005, P&G Shiksha has empowered consumers to contribute towards the education of underprivileged children by exercising conscious brand choices, which has enabled P&G to share a part of the sales towards this movement. P&G Shiksha has till date made a cumulative donation of over Rs. 32 crores towards building new schools, providing critical infrastructural amenities at existing schools or reviving non-operational government schools.

In the course of the past year, Save the Children in partnership with P&G Shiksha has expanded its impact. Six Kasturba Gandhi Balika Vidyalayas (KGBV) and fourteen primary and middle schools were supported through the provision of sports kits and laboratory equipment, which has enhanced the self-confidence and the learning abilities of the girl children. Additionally through this partnership, Baal Sansads and School Management Committees (SMCs) have also been strengthened through capacity building of its members, to monitor the activities of schools for ensuring quality education. These initiatives have thus resulted in a positive change in the overall environment of KGBVs, for example, teachers have started taking initiatives in practicing innovative pedagogical methods (such as promoting an effective use of the library facility, project work, story building as well as an overall better planning and execution of multi- level teaching).

At about 20 km from the Bhiwadi Plant, P&G continues its association with a local school (adopted under the P&G Shiksha program) to promote the education of girl children in Mewat. The students are provided holistic support in the form of uniforms, library, meals, infrastructure, recreational activities & study tours. This year, the initiative received a prestigious recognition with the Bhamashah award by the Rajasthan Government for outstanding contribution in promoting education and creating a transformational change in the lives of young girl children. Similarly, at Goa, in association with Matruchhaya, a local public charitable trust, P&G is providing educational and infrastructural support to a school for the orphaned, destitute and abandoned children. Going beyond the tangible, P&G has also lent assistance in organizing a Fun Day for the children with volunteers (employees and family members) which saw the donation of important amenities and equipment to the

school. These activities under the P&G Shiksha program have exemplified its motto h%tt ff§*iT 3t i%*tt $sm and have further strengthened our resolve of touching and improving lives.

The P&G Baddi plant organized the ''World Environment Day'' event in Lodhimajra Village School in order to create awareness amongst school children on merits of a clean and healthy environment for the overall community.

Under the theme ''^b %, i^> ftrepft'' and "Best Out of Waste", the event brought together school children, who participated in poster design, slogan writing competitions and making of useful items from Waste Material which was meant to create awareness on the importance of a safe and healthy environment.

P&G, over the past year, continued its efforts to provide timely aid and relief to families affected by natural disasters. Over 15,800 families affected by the Uttarakhand Floods and the Odisha Cyclone, received relief aid in the form of hygiene kits comprising of P&G products as well as Children''s Safe Drinking Water sachets.

P&G''s conscious commitment towards the pursuit of sustainable development programs has empowered us to truly make a substantial impact on the lives of the communities around us while simultaneously providing them with superior product propositions. This unequivocal principle has fueled our social responsibility programs aimed at improving lives and also lends inspiration to our efforts on environmental sustainability and economic accountability. At P&G, Corporate Social Responsibility has and will remain an important component of our ability to improve consumers'' lives and to create value for our Members.

ENVIRONMENTAL SUSTAINABILITY

Environmental sustainability is embedded in our Purpose, Values, Principles, and our business. In order to improve lives, now and for generations to come, we ensure that our products, packaging and operations are safe for employees, consumers and the environment. We ensure this with a focus on technologies, processes and improvements that matter for the environment.

Our Company''s Head Office at Mumbai reduced its annual energy consumption by over 37.9% over the last 10 years, saving over 2,159 gigajoules of energy.

At P&G, sustainability inspires and guides everything we do. Moreover, we ensure environmental friendly practices at our sites. These include reduction in power consumption, optimal water consumption and eliminating excess use of paper. With its strong monitoring and control of energy and water consumption, our plant in Bhiwadi, Rajasthan reduced its Environmental Footprint by 9% as compared to last year. The initiatives for the energy reduction at our plant in Bhiwadi resulted into 50% Diesel Savings.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217 (2AA) of the Companies Act, 1956, with respect to the Directors'' Responsibility Statement, it is hereby confirmed:

i. that in the preparation of the Annual Accounts for the Financial Year ended June 30, 2014, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii. that the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the Financial Year and of the profit or loss of the Company for the year under review;

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

iv. that the Directors had prepared the accounts for the Financial Year ended June 30, 2014, on a "going concern" basis.

CORPORATE GOVERNANCE

A separate report on Corporate Governance along with the Auditors'' Certificate on compliance with

Clause 49 of the Listing Agreement is annexed to this Report.

DIRECTORS

During the year, Mr. S. K. Poddar, Chairman and Mr. Akshay Poddar, Director ceased to be Directors of the Company with effect from December 26, 2013 and December 27, 2013 respectively, and also ceased to be the promoters of the Company, in line with the steps undertaken to achieve compliance with Minimum Public Shareholding requirement, as prescribed by the Securities and Exchange Board of India.

The Board places on record deep appreciation for the contributions made by them during their association with the Company.

Mr. B. S. Mehta was appointed as the Chairman of the Company with effect from February 3, 2014.

Ms. Sonali Dhawan has been appointed as Additional Director of the Company with effect from February 25, 2014 and holds office upto the date of the ensuing 30th Annual General Meeting of the Company. Notice under Section 160 of the Companies Act, 2013 has been received from her proposing her candidature as the Non-Executive Director of the Company, liable to retire by rotation.

Mr. Pramod Agarwal, Director, retires by rotation and, being eligible, offers himself for re- appointment.

In terms of Section 149 of the Companies Act, 2013, an Independent Director is required to be appointed for tenure of five years at a time and shall not be liable to retire by rotation. Accordingly, Mr. B. S. Mehta, Mr. C. R. Dua, Mr. Gurcharan Das and Mr. A. K. Gupta meet the criteria of independence and your Board recommends their appointment as Non-Executive Independent Directors for a period of five years with effect from September 29, 2014, not being liable to retire by rotation. Resolutions in this regard form part of the Notice of the ensuing 30th Annual General Meeting.

Brief resumes of Directors proposed to be appointed / reappointed at the ensuing 30th Annual General Meeting and the details of

the Directorships held by them in other companies are given in the "Corporate Governance" section of the Annual Report.

Appropriate resolutions for the appointment/ re-appointment of the aforesaid Directors are being moved at the ensuing 30th Annual General Meeting, which the Board recommends for your approval.

MINIMUM PUBLIC SHAREHOLDING REQUIREMENT PRESCRIBED BY THE SECURITIES AND EXCHANGE BOARD OF INDIA (SEBI)

In terms of amendment to the Securities Contracts (Regulation) Rules, 2010, your Company was required to achieve Minimum Public Shareholding of 25%. Your Directors are pleased to inform you that the Company has achieved compliance with the said requirement during the Financial Year under review.

AUDITORS

The Auditors, M/s. Deloitte Haskins & Sells LLP, Mumbai, Chartered Accountants (Firm Registration No. 117366W/W-100018) retire at the ensuing 30th Annual General Meeting. In terms of the Companies Act, 2013, they are eligible for appointment for three Financial Year(s) and offer themselves for re-appointment upto the conclusion of 33rd Annual General Meeting.

COST AUDITORS

Your Company has re-appointed M/s. Ashwin Solanki & Associates, Cost Accountants, to conduct the cost audit for the Financial Year 2014-15.

CONSERVATION OF ENERGY & FOREIGN EXCHANGE

The information, in accordance with the provisions of Section 217(i)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, regarding conservation of energy, technology absorption and foreign exchange earnings and outgoings, forms part of this Report.

HUMAN RESOURCE DEVELOPMENT

The strong growth over the past few years demonstrates the core strengths of our employees to stay reality-based and proactively influence the course of business. In a diverse organization & competitive environment, the efforts of our organization, strong capability plans and HR innovation accelerated our growth. Our productivity continues to be best-in-class with major progress in Leadership and Talent Development. The Company has a can-do attitude, embraces change easily, and operates as ONE-India.

The information as per Section 217(2A) of the Companies Act, 1956 ("the Act"), read with the Companies (Particulars of Employees) Rules 1975 forms part of this Report. As per the provisions of Section 219(1)(b)(iv) of the Act, the Report and Accounts are being sent to the Members of the Company excluding the statement of particulars of employees under Section 217(2A) of the Act. Any Member interested in obtaining a copy of the said statement may write to the

Company Secretary at the corporate office of the Company.

ACKNOWLEDGEMENTS

Your Directors wish to place on record their appreciation of the services rendered by the Company''s suppliers, distributors, wholesalers, retailers, clearing and forwarding agents and all other business associates and acknowledge their efficiency and continued support in producing such healthy growth in the Company''s business.

For and on behalf of the Board

sd/- B. S. Mehta Chairman

Mumbai August 12, 2014


Jun 30, 2012

TO THE MEMBERS

The Directors have the pleasure in presenting their Twenty-Eighth Annual Report together with the Audited Accounts for the Financial Year ended June 30, 2012.

FINANCIAL RESULTS

(Figures in Rs. Crores)

2011-12 2010-11

Sales (less excise duty) 1232.90 1058.38

Other Income 33.70 32.04 Profit before tax & exceptional items 116.97 133.97

Profit after tax 75.73 86.15

Transfer to General Reserve 7.58 8.62

Proposed dividend plus tax thereon 56.81 56.81

Balance carried forward 294.13 294.28

DIVIDEND

Your Directors are pleased to recommend, subject to the approval of the Members of the Company, a dividend of Rs. 15/- per equity share of 10 each, amounting to Rs. 48.88 crores, for the Financial Year ended June 30, 2012.

OPERATIONS

Your Company achieved a healthy sales growth during the Financial Year ended June 30, 2012. The total sales (net of excise) at Rs. 1,233 Crores are up by 16.5% when compared to Rs. 1,058 Crores of the previous year. The sales in all the three business segments have grown strongly. Your Directors are pleased with these solid results that are driven by a continued focus on the consumer, robust innovation and distribution expansion.

Profit Before Tax (PBT) for the Financial Year under review is Rs. 117 Crores as against Rs. 134 Crores last year. Profit After Tax (PAT) for the Financial Year under review stood at Rs. 76 Crores as against Rs. 86 Crores last year. The PBT and PAT have declined versus year ago, due to currency devaluation and increase in commodity prices as well as manufacturing charges.

PERSONAL GROOMING- BLADES & RAZORS

Gillette grooming portfolio had a strong year with high double digit growth combined with record market share growth. This was driven by robust performance across all product and price tiers through fundamental brand building activities.

Fusion, our premium Blades & Razors brand was successfully launched this Financial Year, in October, 2011. Fusion, with its unique 5-blade shaving technology was aimed at consumers wanting to experience Gillette's best shave.

Mach3, our other premium Blades & Razors brand posted a strong double digit growth. During the Financial Year under review, Mach3 distribution increased by 50,000 stores throughout India. The high double digit growth in Razor sales versus year ago, was on account of powerful marketing campaigns such as the "Salute the Soldier" and 'Shave India Movement' and razor placement programs.

Salute the Soldier Movement" was launched in November, 2011, to strengthen the emotional connect between consumers and Gillette by personifying.The Gillette Man' using the soldier. As a result, it was for the first time that Gillette India Limited crossed 50% value share. It received widespread coverage with over one million Indians participating in the movement.

Gillette Guard, the Entry Level system that was designed specifically for the consumers of low income market continued to grow the consumer base of Gillette systems. Gillette Guard Razor has more than 60% volume share in razor category.

The personal care category of the male grooming business includes pre-shave and post-shave products. This category has performed very well with exceptional value and volume growth over the previous year. It further strengthened its leadership position within the pre shave category.

The double-edge blades' business recorded an excellent value growth in double digit led by Gillette Wilkinson Sword. Thus, the entire 'Gillette Personal Grooming' portfolio witnessed a strong growth across brands.

Gillette India wins a Media Lion at Cannes Ad Fest:

Your Company's campaign You Shave, I Shave as part of the Shave India Movement has won a Media Lion at the Cannes Ad Festival 2012.

ORAL CARE

Oral-B tooth- brushes had a strong year with strong double digit growth. This was driven by robust performance of its products across price tiers during fundamental brand building activities.

Oral-B continues to grow across tiers. Initiatives focused on establishing superiority of Oral-B CrossAction helped Oral-B grow in the super premium tier segment. Oral-B 123 continues to lead our growth in the premium tier by providing superior propositions to the consumers. Dedicated TV Initiatives on Oral-B Shiny Clean along with strong plans to drive deeper distribution further helped strengthen Oral-B s position in the mid- tier segment. Multiple initiatives were undertaken to expand Oral-B distribution, which resulted in the brand being available to more consumers across India.

Oral-B, which is the World's No. I dentist recommended toothbrush brand (Based on surveys of a representative worldwide sample of Dentists carried out for P&G), continued its partnership with Dentists across India, to promote oral health awareness for yet another year through its Oral-B Smile India Movement-2 initiative. This campaign helped in educating the consumers on oral hygiene by offering them a free dental checkup close to their residence simply on the purchase of an Oral-B toothbrush.

PORTABLE POWER

For the Financial Year under review, Duracell has achieved robust sales and grown its share in the Market significantly by trading consumers up, given superior consumer proposition. Key initiatives such as distribution and base building activities have resulted in promising growth. Increasingly, device cavities are changing to AA/AAA sizes where Duracell has a higher scope to win versus zinc batteries.

Duracell has leveraged the scale of the Company, by participating in all Multi Brand campaigns e.g. 'Shiksha & Thank You Mom'. The brand has focused on winning in Metro cities behind 'Multipoint Displays' and driving 'Top of Mind' during the path to purchase. This has led to overall Alkaline battery share leadership in Modem Retail. Overall the brand has expanded its distribution footprint by 15,000 stores and increased its offtake by 60% in Metro cities.

In the coming future, Duracell will continue to outperform the category focusing on high drain consumers in need of superior performance, whilst continuing to service Aspiring Indian" consumers who seek value for money from the battery.

MANUFACTURING

Your Directors have the pleasure of informing you that during the Financial Year under review, the Bhiwadi and Baddi plants continued to perform at record levels. Our new initiative called Integrated Work System (IWS), has helped enhance overall factory/people capability. As a result, our Plants delivered outstanding performance in all key measures such as Safety, Quality, Productivity, Cost etc. During the Financial Year, your Company's Plants delivered highest ever volume with a flawless customer service.

In our pursuit of delivering best quality product to consumers, Bhiwadi plant achieved 89% Quality Assurance Capability in the Company's Quality Assurance System Audit.

Your Directors are also pleased to inform you that the Baddi plant implemented a major initiative of local production of Mach3 razors, which is now resulting in cost savings, on being exported to the European Markets.

CORPORATE SOCIAL RESPONSIBILITY Shiksha reaches out to more children, in more parts of India, more completely P&G's focus on purpose-inspired growth drives us to not only serve our consumers with superior product propositions, but also truly touch and improve the lives of more consumers, more completely by contributing towards the communities we operate in. This commitment is the purpose behind our Corporate Social Responsibility initiatives 'Shiksha and the ' Whisper School Program,' that enables children from lesser-privileged background access their right to health and education.

P&G's flagship Corporate Social Responsibility Program ''Shiksha' is an integral part of our global philanthropy program - Live, Learn Thrive, which currently reaches out to over 50 million children annually. Now in its 8th year, Shiksha enabled over 385,000 lesser-privileged children with access to good quality education by supporting sustainable and critical assets of schools. Shiksha will be supporting over 200 schools by interventions such as reactivating defunct government schools, building new schools or enhancing education infrastructure at existing schools.

During the Financial Year, Shiksha introduced various new amenities, educational aids and health and hygiene programs to contribute to the overall growth and development of the children studying at Shiksha schools. In 2011-2012, P&G's Shiksha initiative has facilitated the addition of a digital library and distance learning programme at the Government High School Lodhimajra, Himachal Pradesh, which allows experts from other cities to conduct online lectures and sessions on various topics directly with the students. Shiksha has also partnered with Project Ekla. Government of Rajasthan and NGO IBTADA, to adopt a girls' school ' Mew at Balika Vidyalaya' with the mutual goal of helping girls in rural Rajasthan access quality education.

Since its inception in 2005, the P&G Group (India) has through Shiksha made a cumulative donation of over Rs. 27 crores towards helping children on the path to better education. This is a result of the support from our consumers who participated in the Shiksha movement by buying P&G brands in the months of January, February and March 2012 and enabling P&G to contribute a part of the sales towards the cause. During the Financial Year under review, P&G Group (India) closed Shiksha with a contribution of Rs. 5.6 crores in association with its partner NGOs, namely, Save the Children India (STC), Army Wives Welfare Association (AWWA), Round Table India (RTI), Navy Wives Welfare Association (NWWA), Air Force Wives Welfare Association (AFWWA) amongst others. Each of Shikshas NGO partners focuses on a critical approach towards education, with NGO Round Table India specializing in building educational infrastructure and supporting schools across India, NGO Save the Children laying emphasis on the girl child via supporting the Government's Kasturba Gandhi Balika Vidhyalayas and the NGOs AWWA, NWWA & AFWWA serving the unique educational needs of differently-abled children of Naval, Air force and Army Officers' families. These activities together help Shiksha further its motto 'viw gfew gtw gfjiii' and help us touch and improve the lives of our consumers.

ENVIRONMENTAL SUSTAINABILITY

Environmental sustainability is embedded in our 'Purpose, Values, Principles' and our business. In order to improve lives, now and for generations to come, we ensure that our products, packaging and operations are safe for employees, consumers and the environment. We ensure this with a focus on technologies, processes and improvements that matter for the environment. We use low emission manufacturing technologies and generate almost 60% less emission than the local norms. We are committed to achieving the 'P&G Global 2012 Goal' of 20% reduction of our footprints. Compliance is an integral part of our business strategy - All our products and formulations comply with Global and Indian regulatory requirements.

We aim at reducing waste at every step of the supply chain, with a robust system that targets zero waste including product shelf life. We seek to develop sustainable products, with an improved environmental profile.

Moreover, we ensure environmental friendly practices at our sites: These include reduction in power consumption, optimal water consumption and eliminating excess use of paper by increasing the use of scanning. A good example is the hydro-electric energy being used at our Plant in Baddi with efforts underway for extending this to other sites.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217 (2AA) of the Companies Act, 1956 ('the Act'), with respect to the Directors' Responsibility Statement, it is hereby confirmed:

(i) that in the preparation of the Annual Accounts for the Financial Year ended June 30, 2012, the applicable Accounting Standards had been followed along with proper explanation relating to material departures;

(ii) that the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company at the end of the Financial Year and of the profit or loss of the Company for the Financial Year under review;

(iii) that the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that the Directors had prepared the accounts for the Financial Year ended June 30, 2012, on a 'going concern' basis.

CORPORATE GOVERNANCE

A separate report on Corporate Governance along with the Auditors' Certificate on it's compliance with Clause 49 of the Listing Agreement is annexed to this Report.

DIRECTORS

- Mr. Shantanu Khosla has been re-appointed as the Managing Director of the Company with effect from January 29, 2012 by the Board of Directors' at their Meeting held on May 4, 2012. This re-appointment is subject to the approval of the Members of the Company at the 28th Annual General Meeting of the Company. The Company is also seeking the approval of the Central Government under Section 316(4) of the Companies Act, 1956, to enable Mr. Shantanu Khosla to function as the Managing Director of two other Group Companies namely Procter & Gamble Hygiene and Health Care Limited and Procter & Gamble Home Products Limited.

- Ms. Deborah Henretta resigned from the Directorship of the Company with effect from August 1, 2012 consequent to an internal re- organization.

Mr. Pramod Agarwal was appointed as an Alternate Director to Ms. Deborah Henretta at the Meeting of the Board of Directors held on February 2, 2012. Consequent to the resignation of Ms. Deborah Henretta from Directorship of the Company, with effect from August 1, 2012, Mr. Pramod Agarwal ceased to be an Alternate Director, from the said date.

- Mr. Pramod Agarwal has been appointed as an Additional Director of the Company with effect from August 1, 2012. As an Additional Director, he holds office upto the date of the 28th Annual General Meeting. A notice under Section 257 of the Companies Act, 1956 has been received from a Member proposing his candidature as a Director of the Company liable to retire by rotation along with a deposit of Rs. 500/-.

- Mr. B S Mehta and Mr. A K Gupta retire by rotation at the ensuing Annual General Meeting, and being eligible, offer themselves for re- appointment.

- The brief resumes of Mr. B S Mehta, Mr. A K Gupta and Mr. Pramod Agarwal and the details of the directorships held by them in other Companies are given in the 'Corporate Governance' section of the Annual Report.

Appropriate resolutions for the appointment/ re-appointment of the aforesaid Directors are being moved at the 28th Annual General Meeting, which the Board recommends for your approval.

AUDITORS

The Auditors, M/s. Deloitte Haskins & Sells, Mumbai, Chartered Accountants (Registration No. 117366W) retire and offer themselves for re-appointment.

COST AUDITORS

Your Company has re-appointed M/s. Ashwin Solanki & Associates, Cost Accountants, to conduct the Cost Audit for the Financial Year ending June 30, 2013. The Company is in the process of applying to the Central Government for seeking approval for the said re-appointment of Cost Auditor.

CONSERVATION OF ENERGY & FOREIGN EXCHANGE

The information, in accordance with the provisions of Section 217(i)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, regarding conservation of energy, technology absorption and foreign exchange earnings and outgoings, are attached as Annexure to this Report.

HUMAN RESOURCE DEVELOPMENT

The Company's growth over the past few years demonstrates the core strengths of our employees to stay reality-based, embrace change and proactively influence the course of business. In a diverse organization and competitive environment, the efforts of our organization, strong capability plans and HR innovation accelerated our growth. Our productivity continues to be the best-in-class with major progress in Leadership and Talent Development. We ended the Financial Year under review, being recognized as No. 2 in the FMCG category in India in the 'Great Place to Work Survey 2012'.

The information as per Section 217(2A) of the Companies Act, 1956 ('the Act') read with the Companies (Particulars of Employees) Rules, 1975 forms part of this Report. As per the provisions of Section 219(1 )(b)(iv) of the Act, the Report and Accounts are being sent to the Members of the Company excluding the statement of particulars of employees under Section 217(2A) of the Act. Any Member interested in obtaining a copy of the said statement may write to the Compliance Officer at the Corporate Office of the Company.

ACKNOWLEDGEMENTS

Your Directors wish to place on record their appreciation for the services rendered by its Suppliers, Distributors, Wholesalers, Retailers, Clearing and Forwarding Agents and all other business associates and acknowledge their efficiency and continued support in producing such healthy growth in the Company's business.



For and on behalf of the Board

S. K. Poddar

Chairman

Mumbai

August 23, 2012


Jun 30, 2011

DIRECTORS' REPORT TO THE MEMBERS

The Directors have pleasure in presenting their Twenty-Seventh Annual Report together with the Audited Accounts for the Financial Year ended June 30, 2011.

FINANCIAL RESULTS

(Figures in Rs. Crores)

2010-11 2009-10

Sales (less excise duty) 1056.86 852.48

Other Income 33.56 21.18

Profit before tax & exceptional items 133.97 212.76

Profit after tax 86.15 137.09

Transfer to General Reserve 8.62 13.71

Proposed dividend plus tax thereon 56.81 57.00

Balance carried forward 294.28 282.55

DIVIDEND

Your Directors are pleased to recommend, subject to the approval of the Members, a dividend of Rs. 15 per Equity Share of Rs. 10 each, amounting to Rs.48.88 crores, for the Financial Year ended June 30, 2011.

operations

Your Company achieved healthy sales growth during the Financial Year ended June 30,2011. The total sales (net of excise) at Rs. 1057 crores are up by 24% when compared to Rs.852 crores of the previous year. The sales in all the three business segments have grown with Oral Care, Personal Grooming and Portable Power all growing in double digits. Your Directors are pleased with these solid results that are driven by a continued focus on the consumer, robust innovation and distribution expansion.

Profit Before Tax (PBT) for the year under review is Rs.134 crores as against Rs.213 crores last year. Profit After Tax (PAT) for the year under review is Rs.86 crores as against Rs. 137 crores last year. This decline represents choices made to deliver growth via category acceleration and defend heavy competition. Your Directors are of the opinion that we continue to have significant opportunity for long term growth by upgrading men from traditional Double Edge blades to superior modern shaving systems. This requires multi-year investments in Capital, Advertising & Promotion and Overheads. Your Directors expect to sustain the strategy given evolving consumer demographics and competitive dynamics.

PERSONAL GROOMING

MachS, our premium Blades & Razors brand posted a strong double digit growth. This was aided by the successful launch of the Gillette Mach3 Turbo Sensitive razor, aimed at the consumers having sensitive skin thus enabling more consumers to experience the ultimate comfort of Mach3. During the year under review, Mach3 distribution increased by 70,000 stores throughout India. The high double digit growth in Razor sales versus year ago, was on account of powerful marketing campaigns and razor placement programs.

The Shave India Movement introduced in January 2011 to launch the Mach3 Turbo Sensitive razor generated unprecedented brand awareness and trial for the product. As a result of this, consumer awareness level has gone up as compared to previous Fiscal. This also helped create a significant digital interaction (duplicated) through popular social networking sites.

The personal care category of the male grooming business includes pre-shave/post-shave products (shaving cream and gel) and deodorants. This category has performed very well with exceptional volume growth over the previous year.

Gillette Guard, the Entry Level system that was designed specifically for the consumers of low income market, in October 2010 continued to grow the consumer base of Gillette systems. The volume sales of Guard, after its successful launch, is more than the combined volume sales of Vector and Mach3 razors. Guard became the number one system razor (unit off-take) in just the second month of its launch. Guard has also become the fastest distributed B&R brand with a impressive distribution reach.

The double edged blades' business recorded an excellent value growth in double digits led by Gillette Wilkinson Sword. Thus, the entire Gillette Male Grooming portfolio witnessed a strong growth across brands.

Gillette India wins an Effectiveness Lion and 2 silver Lion at Cannes Ad Fest:

Your Company's campaign "Women Against Lazy Stubble" has yet again won an Effectiveness Lion at the Cannes Ad Festival this year. This year's campaign

- Shave India Movement - Shave Sutra also won 2 silver Lion's at Cannes Ad Festival.

ORAL CARE

Oral-B toothbrushes had a strong year with strong double digits growth. This was driven by robust performance of its products across price tiers following fundamental brand building activities.

Oral-B continues to grow across tiers. Strong Cross Action family promotions have helped Oral-B continue to grow in the super premium tier segment. Oral-B 123 and Classic continue to lead our growth in the premium tier by providing superior propositions to the consumer. Oral-B Shiny Clean further helped strengthen its position in the mid-tier segment. Multiple initiatives were undertaken to expand Oral-B distribution, which also resulted in the Brand being widely available to the consumers across India.

Oral-B, which is the No. 1 toothbrush brand most Dentists use themselves Worldwide, [Based on surveys of a representative worldwide sample of Dentists carried out for P&G] continued its partnership with Dentists across India, to promote oral health awareness for yet another year through its Smile India Movement initiative. This campaign helped in improving the lives of consumers by offering them a free dental checkup close to their residence simply on the purchase of an Oral-B toothbrush.

PORTABLE POWER

During the year under review Duracell has registered strong growth while growing the alkaline segment and has been able to successfully trade up consumers from lower priced zinc batteries. Base brand building activities are designed to grow your brand's equity and availability. We expect that in the coming year Duracell will be able to leverage consumer habit changes behind strong high drain device penetration gains, where Duracell has a right to win. With increasing power needs, Duracell has strong growth potential to gain value and share from Zinc.

MANUFACTURING

Your Directors have pleasure to inform you that during the year under review, Bhiwadi and Baddi plants continued to perform at record levels. Our new initiative called Integrated Work System (IWS), has helped enhance overall factory/people capability. As a result, plants delivered outstanding performance in all key measures such as Safety, Quality, Productivity, Cost etc. During the Financial Year your Company's Plants delivered highest ever volume with a flawless customer service.

In our pursuit of delivering best quality product to consumers, Bhiwadi plant achieved 95% Quality Assurance Capability in the Company's QA system audit.

Your Directors also have the pleasure to inform you that the Baddi plant implemented a major initiative of local production of Machi razors which is now resulting in cost savings on being exported to European Market.

CORPORATE SOCIAL RESPONSIBILITY

Shiksha:

P&G's focus on purpose-inspired growth drives us to not only serve our consumers with superior product propositions, but also truly touch and improve the lives of more consumers, more completely by contributing towards the communities we operate in. This commitment is the purpose behind our Corporate Social Responsibility initiatives 'Shiksha' and the Whisper School Program,' that help children from lesser-privileged backgrounds access their right to health and education.

P&G's flagship Corporate Social Responsibility Program 'Shiksha' is an integral part of our global philanthropy program - Live, Learn & Lhrive, which currently reaches out to over 50 million children annually. Now in its 7th year, Shiksha enabled over 280,000 lesser-privileged children with access to good quality education by supporting sustainable and critical assets of schools. By the end of fiscal year 2011, Shiksha will be supporting over 140 schools by interventions such as reactivating defunct Government schools, building new schools or enhancing education infrastructure at existing schools. Since its inception in 2005, Shiksha has made a cumulative donation of over Rs.22 crores towards helping children on the path to better education. This is a result of the support from our consumers who participated in the Shiksha movement by buying P&G brands in the months of April, May and June 2011 and enabling P&G to contribute a part of the sales towards the cause. During the Financial year ended June 30, 2011 alone, P&G India closed Shiksha with the largest-ever contribution of Rs.5.6 crores in association with its partner NGOs, namely Save the Children India, Child Rights & You (CRY), Army Wives Welfare Association (AWWA), Round Table India (RTI), amongst others. Each of Shiksha's NGO partners focuses on a critical approach towards education, with NGO Round Table India specializing in building educational infrastructure and supporting schools across India, NGO Save the Children laying emphasis on the girl child via supporting the government's Kasturba Gandhi Balika Vidhyalayas, and the NGOs AWWA and NWWA serving the unique educational needs of differently-abled children of Naval and Army Officers' families. These activities together help Shiksha further its motto ' viw $fem wt wiw tfkm' and help us touch and improve the lives of our consumers.

ENVIRONMENTAL SUSTAINABILITY

Environmental sustainability is embedded in our Purpose, Values, Principles, and our business. In order to improve lives, now and for generations to come, we ensure that our products, packaging and operations are safe for employees, consumers and the environment. We ensure this with a focus on technologies, processes and improvements that matter for the environment. The manufacturing technologies we use are low emission and generate almost 60% less emission than the local norms. We are committed to achieving the P&G global 2012 goal of 20% reduction of our footprints. Compliance is an integral part of our business strategy - All our product and formulations comply with Global and Indian regulatory requirements.

We aim at reducing waste at every step of the supply chain, with a robust system that targets zero waste, including product shelf life. We seek to develop Sustainable Products, with an improved environmental profile.

Moreover, we ensure environmental friendly practices at our sites: These include reduction in power consumption, optimal water consumption and eliminating excess use of paper by increasing the use of scanning. A good example is the hydro-electric energy being used at our plant in Baddi with efforts underway for extending this to other sites.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956 ("the Act"), with respect to the Directors' Responsibility Statement, it is hereby confirmed:

(i) that in the preparation of the Annual Accounts for the Financial Year ended June 30, 2011, the applicable Accounting Standards had been followed along with proper explanation relating to material departures;

(ii) that the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the Financial Year and of the profit or loss of the Company for the Financial Year under review;

(iii) that the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

(iv) that the Directors had prepared the accounts for the Financial Year ended June 30, 2011, on a "going concern" basis.

CORPORATE GOVERNANCE

A separate report on Corporate Governance along with the Auditors' Certificate on its compliance is annexed to this Report.

DIRECTORS

Mr. Subhash Bansal, Whole-time Director ceased to be a Director with effect from May 31, 2011 consequent to his attainment of superannuation from the services of the Company. The Board places on record deep appreciation for the contributions made by Mr. Bansal during his tenure.

Mr. A. Poddar and Mr. Jyoti Sagar retire by rotation at the ensuing Annual General Meeting, and being eligible, offer themselves for re-appointment.

Ms. Nayantara Bali was appointed as an Additional Director on the Board of the Company with effect from August 26, 2011. As an Additional Director she holds office upto the date of the ensuing 27th Annual General Meeting. A notice under Section 257 of the Companies Act, 1956 has been received from a Member proposing her candidature as a Director of the Company liable to retire by rotation along with a deposit of Rs. 500/-.

The brief resumes of Mr. A. Poddar, Mr. Jyoti Sagar and Ms. Nayantara Bali and the details of the Directorships held by them in other Companies are given in the "Corporate Governance" section of the Annual Report.

Appropriate resolutions for the appointment/ re-appointment of the aforesaid Directors are being moved at the ensuing Annual General Meeting, which the Board recommends for your approval.

AUDITORS

The Auditors, M/s. Deloitte Haskins& Sells, Mumbai, Chartered Accountants (Registration No. 117366W) retire and offer themselves for re-appointment.

COST AUDITORS

Your Company has re-appointed M/s. Ashwin Solanki & Associates, Cost Accountants, to conduct the cost audit of drug formulations for the Financial Year ended June 30, 2012. The Company has received the necessary Central Government approval for the re-appointment of Cost Auditor.

CONSERVATION OF ENERGY & FOREIGN EXCHANGE

The information, in accordance with the provisions of Section 217(i)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, regarding conservation of energy, technology absorption and foreign exchange earnings and outgoings, are attached as Annexure to this report.

HUMAN RESOURCE DEVELOPMENT

Your Company has continued to focus on building employee capability and commitment, critical for sustaining business growth and profitability. Competence enhancement initiatives to lead and manage change, develop team and to coach individuals have led to higher levels of employee productivity. The culture of innovation has been strengthened by building innovation skills and the processes to facilitate developments and successful implementation of new ideas.

Your Directors wish to place on record their appreciation for the strong contribution made by employees who have through consistent and highly motivated performance enabled your Company to achieve these results.

The information as per Section 217(2A) of the Companies Act, 1956 (Act) read with the Companies (Particulars of Employees) Rules 1975 forms part of this Report. As per the provisions of Section 219(l)(b)(iv) of the Act, the Report and Accounts are being sent to the Members of the Company excluding the statement of particulars of Employees under Section 217(2A) of the Act. Any Member interested in obtaining a copy of the said statement may write to the Compliance Officer at the Corporate Office of the Company.

ACKNOWLEDGEMENTS

Your Directors wish to place on record their appreciation of the services rendered by its suppliers, distributors, wholesalers, retailers, clearing and forwarding agents and all other business associates and acknowledge their efficiency and continued support in producing such healthy growth in the Company's business.

For and on behalf of the Board

S. K. Poddar

Chairman Mumbai

August 26, 2011










Jun 30, 2010

The Directors have pleasure in presenting their twenty-sixth Annual Report together with the Audited Accounts for the financial year ended June 30, 2010.

FINANCIAL RESULTS

(Figures in Rs. Crores)

2009-10 2008-09

Sales (less excise duty) 852.48 661.51

Other Income 21.18 30.01 Profit before tax & exceptional items 212.76 177.02

Exceptional Items - -

Profit before Tax 212.76 177.02

Profit after tax 137.09 113.13

Transfer to General Reserve 13.71 11.32

Proposed dividend plus tax there on 57.00 47.65

Balance carried forward 282.55 222.17

DIVIDEND

Your Directors are pleased to recommend, subject to the approval of the members, a dividend of Rs. 15 per equity share of Rs. 10 each, amounting to Rs.48.88 crores, for the financial year ended June 30, 2010.

OPERATIONS

Your Company achieved a healthy sales growth during the year ended June 30, 2010. The total sales (net of excise) at Rs. 852 crores are up by 29% when compared to Rs.662 crores of the previous year. The sales in all three business segments have grown with Oral Care leading by 57%, Personal Grooming by 22% and Portable Power by 17%. We are very happy with these solid results that are driven by a continued focus on the consumer, robust innovation and distribution expansion.

Profit Before Tax (PBT) for the year under review is at Rs.213 crores, up by 20% when compared to PBT of Rs. 177 crores of the previous year. Profit After Tax (PAT) at Rs. 137 crores is up 21 % when compared to last years PAT ofRs. 113 crores.

PERSONAL GROOMING

Mach3, our premium Blades & Razors brand posted a strong growth of 26%. This was made possible by the successful launch of the Rs.125 Gillette Mach3 razor, aimed at expanding the user base of the brand and enabling more consumers to experience its ultimate comfort. During the year under review, Mach3 distribution increased by over 60,000 stores throughout India. The high double digit growth in razor sales versus year ago was on account of powerful marketing campaigns and razor placement programs.

The Shave India Movement introduced in November 2009 to launch the Rs.125 Mach3 razor generated unprecedented brand awareness and trial for the product.

The engaging format of the second edition of the Gillette Mach3 India Gaming Championship held in June 2010 drew over 2 million users, which will go a long way in associating young urban consumers with the brand.

The personal care category of the male grooming business includes pre-shave/post-shave products and deodorants. It is heartening to note that your Company is now the market leader in pre-shave (shaving cream and gel) category for the first time in its history. This outstanding achievement has been led by Gillette Tube Shave Gel and Gillette Series Foam with their exceptional volume growth of over 55% and 40% respectively over the previous year.

Gillette Vector, the entry level system continued to rapidly expand its user base by shipping over 5.6 million razors resulting in shipment of over 76 million blades. Vector Plus blades, which was giving the benefit of "fast shave without nicks" grew by over 24% to the consumers behind impactful, television commercials and innovations like "Vector Flash". Distribution expansion initiatives also helped grow Vector razor and blades to over 450,000 outlets across the country, resulting in Vector registering its highest ever share.

The double edged blades business recorded an excellent value growth of 25% led by Gillette Wilkinson Sword. Thus, the entire Gillette Male Grooming portfolio witnessed a strong growth across brands.

Gillette India wins a Silver Lion at Cannes Ad Fest:

Your Companys campaign "Women Against Lazy Stubble" has yet again won a Silver Lion at the Cannes Festival this year. It also won at the Golden World IPRA Awards and has also been recognized as a Stevie Winner at the International Business Awards amongst several domestic awards.

ORAL CARE

Oral-B toothbrushes continued to make its mark by delivering outstanding value growth of over 57%, which was driven by robust performance of its products across price tiers following fundamental brand building activities. This helped Oral-B consolidate its position at No. 2 in the toothbrush category.

Oral-B continues to strengthen its position across tiers. The trial and awareness generated for the innovative CrossAction toothbrushes helped Oral-B continue its leadership in the high end segment. Oral-B 123 and Classic continue to lead our growth in the premium tier by providing superior propositions to the consumer. Oral-B Shiny Clean further helped strengthen the brands position in the mid-tier segment. Multiple initiatives were undertaken to expand Oral-B distribution, which resulted in Oral-B toothbrushes being available across price points in more stores.

Oral-B, the brand which more dentists use themselves worldwide, continued its partnership with dentists across India, to promote oral health awareness for yet another year through its free dental checkup initiative. This campaign helps improve the lives of consumers by offering them a free dental checkup close to their residence simply on the purchase of an Oral-B toothbrush.

PORTABLE POWER

Duracell continues to enjoy value share leadership in the alkaline segment with strong growth on value sales by 17%. This increase in sales was in large part due to increased awareness and brand building programs. The brand increased distribution nationwide making Duracell more accessible to consumers. The growing usage of the high and mid-drain devices like toys and cameras and increased purchasing power in India indicate a good potential for Duracell in the coming years.

MANUFACTURING

The Directors have pleasure to inform you that during the year under review, Bhiwadi and Baddi plants continued to perform at record levels. Last year, we informed you about the new initiative we have embarked upon called Integrated Work System (1WS), which helped enhance overall factory and people capability. As a result, plants delivered outstanding performance in all key measures such as safety, quality, productivity, cost etc. During the year, plants delivered highest ever volumes with a flawless customer service. Bhiwadi plant earned the "Gold" award for reduction in usage of earth resources and safeguarding environment.

In our pursuit of delivering best quality product to consumers, Bhiwadi plant achieved 100% quality assurance capability in the companys QA system audit.

The Directors also have pleasure to inform you that the Baddi plant implemented a major initiative of local production of Mach3 razors. Baddi is not only producing for local market but has started exporting to Europe.

CORPORATE SOCIAL RESPONSIBILITY

Shiksha: v^n^^1
Shiksha, our signature CSR program has in its 6th year helped improve the lives of over 150,000 children across 602 communities with a donation of over Rs.5 crores by all the P&G group companies in India. This year, Shiksha moves onto a new vision of creating tangible, visibly long-lasting impact through the building of Shiksha schools across the country that offers quality education to children in need. Over the last 6 years, your Company has already been associated with helping bring to life over 100 schools via either building them (near our plants), supporting them through non-governmental organizations (NGOs), working with Army Wives Welfare Association schools, or reactivating Government schools through our work with NGO partner CRY. This year we hope that the building of Shiksha schools" will lead to far more children being able to access quality education. After all,

CORPORATE GOVERNANCE

A separate report on Corporate Governance along with the Auditors Certificate on its compliance is annexed to this Report.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under section 217(2AA) of the Companies Act, 1956 ("the Act"), with respect to Directors Responsibility Statement, it is hereby confirmed:

(i) that in the preparation of the annual accounts for the financial year ended June 30, 2010, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(ii) that the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for the year under review;

(iii) that the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

(iv) that the Directors had prepared the accounts for the financial year ended June 30, 2010, on "going concern" basis.

DIRECTORS

Mr. G. C. Das and Mr. C. R. Dua retire by rotation at the ensuing annual general meeting, and being eligible, offer themselves for re-appointment. The brief resumes of Mr. Das and Mr. Dua and the details of the Directorships held by them in other companies are given in the "Corporate Governance" section of the Annual Report.

Appropriate resolutions for the re-appointment of the aforesaid Directors are being moved at the ensuing annual general meeting, which the Board recommends for your approval.

AUDITORS

The Auditors, M/s. Deloitte Haskins & Sells, Mumbai, Chartered Accountants (Registration No. 117366W) retire at the ensuing annual general meeting and offer themselves for re-appointment.

COST AUDITORS

The Company has appointed M/s. Ashwin Solanki & Associates, as the Cost Auditors for "Shaving Systems" manufactured at Bhiwadi plant for the year ending June 30, 2011, for which necessary Central Government approval has been obtained.

CONSERVATION OF ENERGY & FOREIGN EXCHANGE

The information, in accordance with the provisions of section 217(i)(e) of the Act, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, regarding conservation of energy, technology absorption and foreign exchange earnings and outgoings, are attached as Annexure to this Report.

HUMAN RESOURCE DEVELOPMENT

Your Company has continued to focus on building employee capability and commitment, critical for sustaining business growth and profitability. Competence enhancement initiatives to lead and manage change, develop team and to coach individuals have led to higher levels of employee productivity. The culture of innovation has been strengthened by building innovation skills and processes to facilitate developments and successful implementation of new ideas.

Your Directors wish to place on record their appreciation for the strong contribution made by employees who have through consistent and highly motivated performance enabled your Company to achieve these results.

The information as per section 217(2A) of the Act, read with the Companies (Particulars of Employees) Rules 1975 forms part of this Report. As per the provisions of section 219(l)(b)(iv) of the Act, the Report and Accounts are being sent to the members of the Company excluding the statement of particulars of employees under section 217(2A) of the Act. Any shareholder interested in obtaining a copy of the said statement may write to the Secretarial Officer at the corporate office of the Company.

ACKNOWLEDGEMENTS

Your Directors wish to place on record their appreciation of the services rendered by its suppliers, distributors, wholesalers, retailers, clearing and forwarding agents and all other business associates and acknowledge their efficiency and continued support in producing such healthy growth in the Companys business.

For and on behalf of the Board

S. K. Poddar Chairman Mumbai August 18,2010





 
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