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Directors Report of Monsanto India Ltd.

Mar 31, 2014

TO THE SHAREHOLDERS,

The Directors are pleased to present the Sixty fourth Annual Report of the working of the Company along with the Audited Financial Statements and Auditors'' Report for the financial year ended March 31, 2014.

FINANCIAL HIGHLIGHTS

The financial performance of your Company, for the year ended March 31, 2014 is summarized below:

(Rs. in Crores) Year ended Year ended 31st March, 2014 31st March, 2013

Net Sales 581.84 442.42

Profit Before Taxes 138.74 74.97

Taxation 15.85 7.63

Balance of Profit 122.89 67.34

Add: Balance brought forward from previous year 135.00 118.70

Amount Available for Appropriation 257.89 186.04

Appropriated As Under:

a. Interim Dividend 107.03 17.27

b. Tax on Interim Dividend 18.19 2.80

c. Proposed Final Dividend 51.79 20.72

d. Tax on proposed Final Dividend 8.80 3.52

e. Transfer to General Reserve 12.29 6.73

Balance in Statement of Profit & Loss 59.79 135.00

Your Company posted yet another year of impressive performance with a healthy topline growth and high quality earnings. During the financial year (F.Y.) 2013-14, growth in Corn as well as Roundup® business in terms of volume and value has led to overall growth in operating profit. Your Company posted a Profit After Tax (PAT) of Rs. 122.89 Crores for F.Y. 2013-14 compared to previous year PAT of Rs. 67.34, (an 83% rise). Pre-tax profits are also higher by 94% at Rs. 145.64 (previous year Rs. 74.97 Crores).

Net Turnover for the year under review, at Rs. 581.84 Crores compared to Rs. 442.42 Crores for the previous F.Y. grew by 31%. Net Sales of Dekalb® corn seeds for the year stood at Rs. 366.33 Crores against Rs. 297.51 Crores for the previous year, indicating a 23% rise. Sales of Roundup® increased to Rs. 208.89 Crores (net of excise duty) from Rs. 139.03 Crores in the previous year, a rise of over 50%.

OPERATIONAL HIGHLIGHTS

Your Company''s corn seeds'' sale was higher by 23% at Rs. 366.33 crores in the F.Y. 2013-14 vis-à-vis Rs. 297.51 Crores in the F.Y. 2012-13. This is mainly attributable to the following:

The branded corn business of the Company grew in volume as well as value. There was a 7% volume growth coupled with an increase in both trade and project business realisations. The branded corn volumes have also grown well in many parts of the country. Growths in the North and in the West are noteworthy in this regard.

Net Sales of Roundup® during the year is Rs. 208.89 crores, higher by Rs. 69.86 crores (50%) over the previous year of Rs. 139.03 crores. The increase is primarily driven by higher volume by 48% and higher net realization by 12% in the Brand business. Prolonged monsoon and high China acid prices has led to volume as well value growth.

The operating expense in the year is Rs. 204.28 crores, a 15% increase over previous year, in spite of high inflationary trend. The increase is mainly due to higher volumes and Inflationary pressures.

Other non - operating income for the year is at Rs. 12.92 Crores, which is lower by Rs. 3.99 Crores over the last year (Rs. 16.91 Crores). The decrease in other non-oprating income which is on account of lower investment due to payment of special interim dividend to shareholders.

DIVIDEND & SHARE CAPITAL

During the F.Y. 2013-14, your Company declared an interim and a special dividend of Rs. 12 (Rupees Twelve only) and Rs. 50 (Rupees Fifty only) per equity share. In addition, your Directors are pleased to recommend a payment of Rs. 30 (Rupees Thirty only) per equity share as the final dividend for the financial year ended March 31, 2014. If approved, the total dividend (interim and final dividend) for the financial year 2013-14 would be Rs. 92 (Rupees Ninety Two only) per equity share.

CORPORATE GOVERNANCE

A detailed report on the corporate governance system and practices of the Company forming part of this report is given as a separate section of the Annual Report.

The requisite Certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance as stipulated under the Clause 49 is attached to this Report.

MANAGEMENT DISCUSSION AND ANALYSIS A management discussion and analysis on the business and operations of the Company forming part of this report is given as a separate section of the Annual Report.

DIRECTORS

The following changes occurred in the Board of Directors of the Company during the financial year:

Mr. Ravinder Reddy tendered resignation as the Director of the Company effective December 2, 2013. Your Board of Directors acknowledge and put on record its deep appreciation for the valuable contributions rendered by Mr. Ravinder Reddy during his tenure. Mr C. Ravishankar has been appointed as an Additional Director in accordance with Section 260 of the Companies Act, 1956 with effect from December 6, 2013.

In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Mr. R.C. Khanna retires by rotation at the ensuing Annual General Meeting and, being eligible, offers himself for re-appointment.

Mr. H.C. Asher and Mr. Pradeep Poddar, both Non Executive, Independent directors of the Company whose period of office was liable to determination by retirement of directors by rotation as per the provisions of erstwhile Companies Act, 1956 are proposed to be re-appointed to hold office for two consecutive years for a term upto date of the 66th Annual General Meeting of the Company. Their re-appointment is proposed pursuant to the provisions of Sections 149, 150, 152 and any other applicable provisions of the Companies Act, 2013, the rules made thereunder (including any statutory modification(s) or re-enactment thereof for the time being in force) read with Schedule IV to the Companies Act, 2013 and General Circular no. 14/2014 dated 9th June, 2014, issued by the Ministry of Corporate Affairs.

A brief profile of each of the said directors as required by Clause 49(IV)(G) of the Listing Agreement forms a part of the Notice contained in this Annual Report. The Board recommends the same for shareholders'' approval in the ensuing Annual General Meeting.

DIRECTORS'' RESPONSIBILITY STATEMENT In compliance with Section 217(2AA) of the Companies Act, 1956 ("the Act"), your Directors, on the basis of information made available to them, confirm the following:

a) In the preparation of the annual accounts, the applicable accounting standards have been followed and that no material departures have been made from the same;

b) They 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 at the end of the financial year and of the profit or loss of the Company for that period;

c) They have taken proper and sufficient care to the best of their knowledge and ability, 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; and

d) They have prepared the annual accounts on a going concern basis.

The above has been reviewed and noted by the Audit Committee at its meeting held on May 30, 2014.

PERSONNEL

The Company continues to maintain cordial relationship with its workforce at all locations. Continuous upgradation of core skills, through training programs conducted by internal as well as external agencies, are an integral part of human resources development policy of the Company.

Information as per Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended, is available at the registered office of your Company. However, in terms of Section 219(1)(b)(iv) of the Act, this report and accounts are being sent to all members of the Company and others entitled thereto excluding the aforesaid information. Any member interested in obtaining such particulars may write to the Company Secretary at the registered office of the Company.

AUDITORS AND AUDITORS'' REPORT M/s Deloitte Haskins & Sells, LLP (DHS), Chartered Accountants, (117366W/W-100018), the Statutory Auditors of the Company hold office until the conclusion of the ensuing Annual General Meeting and are recommended for re-appointment for a term of three years i.e. until conclusion of the 67th Annual General Meeting of the Company. DHS has furnished a certificate under Section 139(1) of the Companies Act, 2013, of their eligibility for re-appointment.

Auditors'' Report to the shareholders does not contain any qualification.

CoST AuDIToRS

Pursuant to the direction from the Ministry of Corporate Affairs for appointment of Cost Auditors, your Board had re-appointed M/s ABK & Associates, as the Cost Auditor of your Company for the financial year 2013-14 to conduct the audit of the cost records of the Company.

The report with respect to the audit of cost accounts maintained in respect of insecticides manufactured by the Company will be submitted to the Central Government in due course.

CONSERVATION OF ENERGY & TECHNOLOGY

ABSORPTION

The information required to be furnished pursuant to 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 is enclosed as Annexure - 1 and forms part of this report.

FOREIGN EXCHANGE EARNINGS AND OUTGO The details of earnings and expenditure in foreign currency are given in Notes 30 and 31 in the Notes to the Accounts.

FIXED DEPOSITS

Your Company has not accepted any public deposits under Section 58A of the Companies Act, 1956 during financial year 2013-14.

ACKNOWLEDGEMENT

Your Directors would like to express their appreciation for the assistance and co-operation received from its shareholders, Government authorities, vendors, channel partners, and other business associates. Your Directors appreciate the continued support from Monsanto Company, USA and would also wish to place on record their deep sense of appreciation for the committed services by the employees of the Company. Without this support, the Company would not be able to successfully serve its farmer customers whose success eventually determines the Company''s success.

For and on behalf of the Board of Directors

Sekhar Natarajan

Mumbai: July 11, 2014 Chairman


Mar 31, 2013

To the Shareholders,

The Directors are delighted to present the 63rd Annual Report of your Company together with the Audited Financial Statements for the financial year ended 31st March, 2013.

Financial Highlights

The financial performance of your Company, for the year ended 31st March, 2013 is summarized below:

(Rs. in Crores)

Year ended 31st Year ended 31st March, 2013 March, 2012

Net Sales 436.54 367.98

Profit Before Taxes 74.97 60.14

Taxation 7.63 9.95

Balance of Profit 67.34 50.19

Add: Balance brought forward from previous year 118.70 113.65

Amount Available for Appropriation 186.04 163.84

Appropriated As Under:

a. Interim Dividend 17.27 17.26

b. Tax on Interim Dividend 2.80 2.80

c. Proposed Final Dividend 20.72 17.26

d. Tax on proposed Final Dividend 3.52 2.80

e. Transfer to General Reserve 6.73 5.02

Balance in Statement of Profit & Loss 135.00 118.70

During the financial year under review your Company posted a Profit After Tax (PAT) ofRs. 67.34 Crores for F.Y. 2012-13 compared to previous year PAT ofRs. 50.19 Crores (a 34% rise). Pre-tax profits are also higher by 25% atRs. 74.97 Crores. (previous year Rs. 60.14Crores)

Net Turnover for the year under review, atRs. 436.54 Crores compared to Rs. 367.98 Crores for the previous F.Y. grew by 19% primarily driven by robust growth in Corn as well as Roundup®. Net Sales of Corn during the year under review is Rs. 297.51 Crores, which is higher byRs. 30.15 Crores (11%) in comparison with the previous year. Net Sales of Roundup® during the year is Rs. 139.03 Crores, higher byRs. 38.41 Crores (38%) over the previous year.

Operational Highlights

Your Company''s seeds'' sale was higher by 11% atRs. 297.51 Crores in the F.Y. 2012-13 vis-a-visRs. 257.35 Crores in the F.Y. 2011-12.

Roundup® sales increased by 38% from Rs. 100.52 Crores in the F.Y. 2011-12 toRs. 139.03 Crores. The increase is primarily driven by volume growth and higher realization throughout the year.

The operating expense in the year isRs. 177.85 Crores, which is 8% increase over previous year, in spite of high inflationary trend.

Dividend & Share Capital

During the financial year 2012-13, your Company declared an interim dividend ofRs. 10 (Rupees Ten only) per equity share. In addition, your Directors recommend payment of Rs. 12 (Rupees Twelve only) per equity share as the final dividend for the financial year ended 31st March, 2013. If approved, the total dividend (interim and final dividend) for the financial year 2012-13 will be Rs. 22 (Rupees Twenty two only) per equity share.

Corporate Governance

A detailed report on the corporate governance system and practices of the Company forming part of this report is given as a separate section ofthe Annual Report.

Management Discussion And Analysis

A management discussion and analysis on the business and operations ofthe Company forming part of this report is given as a separate section ofthe Annual Report.

Directors

The following changes occurred in the Board of Directors ofthe Company during the financial year:

Mr. Amitabh Jaipuria tendered resignation as the Managing Director effective 1st March, 2013 and consequently he ceased to be a Director on the Board of your Company. The Board acknowledges and has put on record its deep appreciation for the valuable contributions rendered by Mr. Amitabh Jaipuria during his tenure. The Board of Directors at its meeting held on 28th January, 2013, appointed Mr. Gyanendra Shukla as an Additional Director in accordance with Section 250 ofthe Companies Act, 1955 with effect from 1st March, 2013 and as Managing Director with effect from 1st March, 2013 to 28th February, 2015.

In accordance with the provisions ofthe Companies Act, 1955 and the Articles of Association ofthe Company, the following directors retire by rotation at the ensuing Annual General Meeting and, being eligible, offer themselves for re-appointment.

- Mr. H. C. Asher; and

- Mr. Pradeep Poddar

A brief profile of each of the said directors as required by Clause 49(IV)(G) of the Listing Agreement forms a part of the Notice contained in this Annual Report. The Board recommends the same for shareholders'' approval in the ensuing Annual General Meeting.

Directors'' Responsibility Statement

In compliance with Section 217(2AA) ofthe Companies Act, 1955 ("the Act"), your Directors, on the basis of information made available to them, confirm the following:

a) In the preparation ofthe annual accounts, the applicable accounting standards have been followed and that no material departures have been made from the same;

b) They 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 at the end of the financial year and of the profit or loss of the Company for that period;

c) They have taken proper and sufficient care to the best of their knowledge and ability, 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; and

d) They have prepared the annual accounts on a going concern basis.

The above has been reviewed and noted by the Audit Committee at its meeting held on 29th May 2013.

Personnel

The Company continues to maintain cordial relationship with its workforce at all locations. Continuous upgradation of core skills, through training programs conducted by internal as well as external agencies, are an integral part of human resources development policy ofthe Company.

Information as per Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended, is available at the registered office of your Company. However, in terms of Section 219(1)(b)(iv) of the Act, this report and accounts are being sent to the shareholders excluding this annexure. Any shareholder interested in obtaining this annexure may write to the Company Secretary at the registered office of the Company.

Auditors and Auditors'' Report

M/s Deloitte Haskins & Sells (DHS), Registration No. 117366W, the Statutory Auditors ofthe Company hold office until the conclusion ofthe ensuing Annual General Meeting and are recommended for re-appointment. DHS has furnished a certificate under Section 224(1B) ofthe Companies Act, 1956, of their eligibility for re-appointment.

Auditors'' Report to the shareholders does not contain any qualification.

Cost Auditors

Pursuant to the direction from the Ministry of Corporate Affairs for appointment of Cost Auditors, your Board had reappointed M/s ABK & Associates, as the Cost Auditor of your Company for the financial year 2012-13 to conduct the audit of the cost records ofthe Company.

The report with respect to the audit of cost accounts maintained in respect of insecticides manufactured by the Company will be submitted to the Central Government in due course.

Conservation of Energy & Technology Absorption

The information required to be furnished pursuant to Section 217(1)(e) ofthe Act read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 is enclosed as Annexure -1 and forms part of this report.

Foreign Exchange Earnings and Outgo

The details of earnings and expenditure in foreign currency are given in Note 43 in the Notes to the Accounts.

Fixed Deposits

Your Company has not accepted any public deposits under Section 58A of the Companies Act, 1956 during financial year 2012-13.

Acknowledgement

Your Board acknowledges the service rendered by the employees of the Company for the satisfactory performance of the Company. The Board appreciates the continued support from Monsanto Company, USA. The Board thanks its shareholders, channel partners, and other business associates for their support. Without this support, the Company would not be able to successfully serve its farmer customers whose success eventually determines the Company''s success.

For and on behalfofthe Board of Directors

Sekhar Natarajan

Mumbai:29th May, 2013 Chairman


Mar 31, 2011

To the Shareholders,

The Directors have pleasure in presenting their 61st Annual Report together with the audited accounts for the year ended 31st March, 2011.

FINANCIAL HIGHLIGHTS (Rs. in Lacs)

Year ended Year ended 31st March, 2011 31st March, 2010

Net Sales 35826 41023

Profit Before Taxes 5029 5777

Taxation 746 (395)

Balance of Profit 4283 5382

Add: Balance brought forward from previous year 9519 6440

AMOUNT AVAILABLE FOR APPROPRIATION 13802 11822

APPROPRIATED AS UNDER:

a. Interim Dividend 863 863

b. Tax on Interim Dividend 143 147

c. Proposed Final Dividend 863 647

d. Tax on proposed Final Dividend 140 108

e. Transfer to General Reserve 428 538

Balance in Profit & Loss Account 11364 9519

13802 11822

During the financial year under review, the net sales of the Company were Rs. 358.3 Crores as against Rs. 410.2 Crores in the financial year 2009-10. Net sales for the financial year 2009-10 included sales of Rs. 64.1 Crores for Butachlor and Alachlor business sold by the Company in the year 2007-08, the sales of which have been marginal during the financial year 2010-11. These sales were made as a part of the manufacturing support agreed with the buyers of the said business at the time of sale. Net sales for the financial year under review, excluding the impact of such sales of Butachlor and Alachlor as aforesaid, have grown marginally by over 3% as compared to the previous year.

Profit before tax decreased by 13% to Rs. 50.3 Crores in the financial year 2010-11 from Rs. 57.8 Crores in the financial year 2009-10. The main r eason for the reduction in the pr ofit has been on account of diminution in the v alue of assets of the Company's facility at Eluru, Andhra Pradesh as part of a plan to consolidate manufacturing operations in Hyderabad, Andhra

Pradesh. In order to enhance operational savings, the Company decided to shift the seed processing and drying operations at Bellary, Karnataka and Eluru to Hyderabad. The relevant assets at Eluru and Bellar y have been shown under `Assets held for sale' in the Company's balance sheet. The said assets are valued at the lower of net book value and net realizable value in accordance with Accounting Standard 10 - Accounting for Fixed Assets. Therefore, in case of assets at Eluru, the net realizable value has been lower by Rs. 12.17 Crores based on a letter of intent issued by the Company to a prospective buyer and the loss has been recognized in the Profit and Loss Account. In respect of fixed assets at Bellary, the management expects to obtain net realizable value higher than the net book value of the assets. Therefore, the fixed assets at Bellary are carried at net book value. Without this Rs. 12.17 Crores charge, the PBT would have been 8% higher than the previous year.

Profit after tax decreased by 20% to Rs. 42 .8 Crores in the financial year 2010-11 from Rs. 53.8 Crores in the financial y ear 2009-10. Without restructuring impact, the PAT would have been 2% higher than the previous year.

These results have been delivered despite the intense price pr essure on Roundup® glyphosate herbicides and the one-time write off in relation to diminution in value of assets described above.

OPERATIONAL HIGHLIGHTS

The Company's seeds sales increased by 1% from Rs. 266.31 Crores in the financial year 2009-10 to Rs. 269.34 Crores in the financial year 2010-11. The domestic trade business saw strong growth in net sales of 8 %. However, there is a reduction in exports and bulk sale by 80% as a result of lower e xports to South East Asia. In order to sustain and gr ow the business, appropriate investments are being made in production, quality and breeding.

The Company's glyphosate sales increased by 20% from Rs. 73.99 Crores in the financial year 2009-10 to Rs. 88.70 Crores in the financial year 2010-11 despite the pricing challenge which continues to exist in the glyphosate business. The C ompany's product continues to garner a quality premium as compared to that of competitors. This business has seen robust growth in volumes of 30% on account of prolonged rains, increasing cost of labor for manual weeding and proactive customer related campaigns.

DIVIDEND

Your Directors had declared an interim dividend of Rs. 10/- (@ 100%) per equity share.

Your Directors are pleased to recommend a final dividend of Rs. 10/- (@ 100%) per equity share for the year 2010-11.

The total dividend for the year would be Rs. 20/- (@ 200%) per equity share including the proposed final dividend.

CORPORATE GOVERNANCE

A detailed report on the corporate governance system and practices of the Company forming part of this report is given as a separate section of the Annual Report.

MANAGEMENT DISCUSSION AND ANALYSIS

A management discussion and analysis on the business and oper ations of the Company forming part of this report is given as a separate section of the Annual Report.

DIRECTORS

The following changes occurred in the Board of Directors of the Company during the financial year:

Mr. Amitabh Jaipuria was re-appointed as the Managing Director of the Company effective 1st November, 2010.

Mr. H. C. Asher retires by rotation at the ensuing Annual General Meeting and, being eligible, offers himself for re-appointment.

Mr. Sekhar Natar ajan retires by r otation at the ensuin g Annual Gener al Meeting and, bein g eligible, offers himself f or re-appointment.

DIRECTORS' RESPONSIBILITY STATEMENT

In compliance with Section 217(2AA) of the Companies Act, 1956 ("the Act"), your Directors, on the basis of information made available to them, confirm the following:

a) In the preparation of the annual accounts, the applicable accounting standards have been followed;

b) They have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of a fairs of the Company at the end of the financial year and of the profit or loss of the Company for that period;

c) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the A ct, for safeguarding the assets of the C ompany and f or preventing and detecting fraud and other irregularities; and

d) The annual accounts are prepared on a going concern basis.

PERSONNEL

The Company continues to maintain cordial r elationship with its workforce at all locations. C ontinuous upgradation of core skills, through training programs conducted by internal as well as external agencies, are an integral part of human resources development policy of the Company.

Information as per Section 21 7(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended, is a vailable at the r egistered office of your Company. This is giv en in an anne xure which forms part of this report. However, in terms of Section 219(1)(b)(iv) of the Act, this report and accounts are being sent to the shareholders excluding this annexure. Any shareholder interested in obtaining this annexure may write to the Company Secretary at the registered office of the Company.

AUDITORS

M/s. Deloitte Haskins & Sells, C hartered Accountants, retire as auditor s of the C ompany at the ensuin g Annual Gener al Meeting and, being eligible, are proposed for re-appointment.

COST AUDITORS

The report of Mr . M. B. Ashtamker , Cost Accountant, in respect of audit of the cost a ccounts maintained in r espect of insecticides manufactured by the C ompany, for the financial y ear 2009-10 was submit ted to the C entral Government on 3rd June, 2010 within prescribed time. Mr. M. B. Ashtamker, Cost Accountant, was re-appointed as the Cost Auditor for the financial year 2010-11 and the report thereof will be submitted to the Central Government in due course.

CONSERVATION OF ENERGY & TECHNOLOGY ABSORPTION

The information required to be furnished pur suant to Section 21 7(1)(e) of the A ct read with the C ompanies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 is enclosed as Annexure - 1 and forms part of this report.

FOREIGN EXCHANGE EARNINGS AND OUTGO

The details of earnings and expenditure in foreign currency are given in Notes to Accounts in Schedule 14, paras 6 and 7.

ACKNOWLEDGEMENT

Your Board acknowledges the ser vice rendered by the emplo yees of the C ompany for the satisfactory performance of the Company. The Board appreciates the continued suppor t from Monsanto Company, USA. The Board thanks its shar eholders, channel partners, and other business associates f or their support. Without this support, the Company would not be able to successfully serve its farmer customers whose success eventually determines the Company's success.

For and on behalf of the Board of Directors

Sekhar Natarajan

Mumbai: 30th May, 2011 Chairman





 
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