BRITANNIA - Morningstar, Inc.

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BRITANNIAEat Healthy, Think Better


of

aiAIRMAN : Nusli N Wadia

Avijit Deb

Anil K Hirjee

Simon Israel

Nimesh N Kampani

S S Kelkar

Pratap Khanna

Field Marshal Sam Manekshaw, M.C

John Miller

Francois - Xavier Roger

t UH-VF\H ! ii\nn-Ht ! K : Vinrta Bali

FINANCIAL : .N Shridhar

SECRETARY: V Madan. ;'

AUDITORS: Lovelock & Lewes j

l"i\\KH}>: State Bank of India . ' |

Citibank NA . |

Standard Chartered Bank I

Hongkong & Shanghai Banking Corporation |

Bank of America I

HDFCBank

ICICI Bank . j

ABN Amro Bank


MOMcS"" TABLE OF CONTENTS

Financial Highlights 2

Report of the Directors 3

Management Discussion and Analysis 1 0

Report on Corporate Governance 12

Auditors' Report 22

Balance Sheet 26

Profit and Loss Account 27

Cash Flow Statement 28

Schedules and Notes to Balance Sheet 30

Schedules and Notes to Profit & Loss Account 44

Statement of Value Added 58

Significant Ratios 59

Ten Year Financial Statistics 60 -

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Annual Report2004-2005 FINANCIAL HIGHLIGHTS

Rs. mn 2004-05 2003-04 %Change

Sales

Operating profit

Shareholders' funds

Capital expenditure

Before exceptional items

- Profit before tax

Profit after tax

- Cash flow generation

After exceptional items

- Profit before tax

Profit after tax

- Cash flow generation

Per equity share (Rs.)

Earnings

Dividend

Dividend + Tax

16,154 14,705

1,649

432

2,420

1,624

1,814

2,203

1,488

1,678

60.59

14.00

15.96

1,478

4,435 4,310

1,963

1,265

1,489

1,188

1,412

44.16

11.00

12.23

10%

12%

3%

118 266%

23%

28%

22%

1,844 19%

25%

19%

37%

27%

30%

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BRITANNIAEat Healthy, mn* Better


2ooT2oRoe5port REPORT OF THE DIRECTORS

The Directors present their Annual Report together withthe Audited Statement of Accounts for the year ended3 1st March, 2005.

1 . FINANCIAL RESULTS

Rs. mn

Particulars Year ended Year ended31 Mar. '05 31 Mar. '04

Corporate Sales 16,154

Operating Profit beforedepreciation and amortisation 1,839Less : Depreciation &

amortisation (190)

Operating profit 1,649Add : Other income

(net of interest) 771Profit before tax andexceptional items 2,420Exceptional itemsLess : Proportionate VRS costs (134)Less : Provision for Diminution

in value of investments (325)Less : Claims for Corporate

Guarantee (115)Add : Profit on sale of brand 324Add : Provisions no longer

required - written back 35Less : Loss on retiral of assets (1)Less : (Loss)/Profit on sale of

properties (1)Less : Irrecoverable advance

written off -Add : Refund of excess

contribution topension funds -

Profit before tax 2,203Less : Provision for taxation 715

Net profit 1,488Add : Transfer from Debenture

Redemption Reserve -•Add : Profit brought forward 500Add : Reversal of proposed

dividend of previous year 10

Profit available for appropriation 1,998Less : Dividend on equity shares 334Less : Tax on dividend 47

Less : Transfer to General Reserve 1,117

Profit carried forward 500

14,705

1,702

(224)

1,478.

485

1,963

(97)

(78)

64(3)

59

(185)

121

1,844656

1,188

30500

1,71827235

911

500

2. COMPANY PERFORMANCE

Your Company posted a net sales growth of 10%.Profit before tax and exceptional items at Rs. 2,420mn improved by 23% and Operating Profit atRs. 1,649 mn increased by 12%.

Despite significant increases in input cost andstagnant or declining consumer prices, businessefficiency has improved as a result of the focusedinitiatives of the Company on supply chainefficiencies and overall cost management.Consequently, operating margin improved from10.0% to 10.2% in an environment where marginsfor packaged consumer goods were under pressure.

17000r GROSS INCOME -j 17 W

12000 2002-03 2003-04 2004-05 U "Wm Gross Income — @— EBITDA |

Gross revenues increased by 10% over last year.Additionally, your Company's focus this year wason improving organisational effectiveness,increasing distribution efficiencies and controllingcosts. Your Company has achieved a satisfactoryEBITDA / Gross Sales ratio of 16.3% compared with15.3% in 2003-04 and performed better than mostof the comparable companies in the industry.

lgoo EARNING AFTER EXCEPTIONAL ITEMS 65

^ 1200- ^^^f:^ •;:>; ;^ |

800 2002-03 2003-04 2004-05 3°•IPAT EH3 Cash profit — D— Earnings per share

The major exceptional items during the year were:

• Provision for diminution of value ininvestment Rs. 325 mn

• Provision for claims on account of corporateguarantee Rs. 115 mn

• Profit on sale of brand Rs. 324 mn

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Annual Report2004-2005

After considering all the exceptional items, Profitbefore tax and Net Profit work out to Rs. 2,203 mnand Rs. 1,488 mn respectively.

Earnings per Share have increased from Rs. 44.16in the last year to Rs. 60.59 this year.

3. DIVIDEND

The Board of Directors are pleased to recommend adividend of 140% on the paid up equity sharecapital of the Company, which works out to Rs. 147-per share, for consideration and approval of theJ7 7 £- f

shareholders at the Annual General Meeting. Thetotal payout of proposed dividend is Rs. 381 mnwhich includes the corporate dividend tax ofRs. 47 mn.

4. BUSINESS OUTLOOK

At a macro level the Indian economy continues togrow at a healthy pace with a 6.9% growth in thefinancial year 2004-05 on the back of robustshowing by manufacturing and service sectors.However, this is lower than 8.5% growth in 2003-04primarily due to lower farm output growth at 1 . 1 %.India's economic outlook remains encouraging,O O'

with both domestic demand and exports drivingthe current economic expansion. Consumer andbusiness confidence remain upbeat, withindications of investment recovery taking hold,though rising oil prices will increase the cost ofdoing business.

The increase in personal disposable income haslargely been directed at personal asset building andspending on a vast array of white goods. BrandedFMCG growth was subdued in the year with leadingbrands and companies showing low single digitgrowth. Also, with increasing competition in almostall categories at the lower end of the price spectrum,revenue growth through price increases has givenway to revenue growth through mix management.

Within FMCGs, the biscuit industry showed a robustvolume growth of about 12% last year, thoughoverall price realisation dropped by approximately2%, largely due to brand and pack mix. Significantnew capacity was created in the market both byexisting national players and new local players.The industry is expected to continue its pace of10-12% volume growth with the market becomingincreasingly competitive as national and localplayers position themselves to capture this share ofgrowth. Your Company will continue to focus onprofitable growth through mix management,

expanding distribution and availability, and bycontinuing to invest in the relevance anddifferentiation of its brands.

5. BUY BACK OF SHARES

During the year, 1,221,887 equity shares of Rs. 107-each have been bought back and extinguishedunder an approved scheme of buy-back, at anaverage price of Rs. 636.81 per share resulting in atotal outflow of Rs. 778.1 mn. The number of paidup equity shares now stands reduced from25,112,050 to 23,890,163 equity shares.

No public announcement was made pursuant to thefourth round of buyback, as per the scheme approvedby the members by passing a special resolution atthe Annual General Meeting held on 19th August,2004 in terms of Section 77 A(2)(b) of the CompaniesAct, 1956, since the market price of the sharesgenerally remained above the maximum price ofRs. 6507- per share determined as per the approvedscheme. As provided under Section 77A(4), thevalidity of the aforesaid scheme expires on18th August, 2005.

6. BRAND INVESTMENT

Your Company believes in giving the best value toconsumers through its brands and constantly looksfor ways to enhance the overall consumerexperience. In 2004-05, several of the lead brandsin the portfolio posted double digit growth on theback of marketing and sales initiatives. Theseincluded Tiger, Good Day, Marie and Milk Bikis.Your Company now has six power brands in itsportfolio each exceeding Rs. 100 crores in annualsa es.

The emphasis on expanding distribution reach alsocontinued and 50% of Tiger sales now come fromrural markets. Your Company will continue toexpand its reach and presence in existing urbanmarkets as well as invest in the right distributionand sales infrastructure to increase availability inthe growing rural markets.

Several new products were launched during the yearsuch as Treat-Duet and Tiger Orange Cream, inaddition to new variants in Jim- Jam Treat and Cakes.Additionally, new packaging formats wereintroduced in several markets to tap into attractiveprice points from a consumer perspective.

Going forward, your Company has set its focus onproduct innovation and development based on new

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Eat Healthy, Think Better



opportunities for positioning our brands in theoverall consumption repertoire of food products.This will pertain to both existing as well as newproducts and brands. Part of the innovation agendar c?

will continue to address product and packagingenhancements both from a technical and aestheticperspective.

Consistent with the focus on brands as the driversof profit for the Company and drivers of value forall stakeholders, your Company re-organised itsstructure and moved from geographies as profitcentres to brands as profit centres.

7. CAPACITY EXPANSION

The new factory in the state of Uttaranchal wascommissioned in record time and startedcommercial production in April 2005, ahead of the'scheduled date. Despatches of productscommenced from mid April. The current focus is ontraining and a quick ramp up to reach full capacityby the end of 3rd quarter of this year. In line withgrowing demand, capacity enhancements were alsocompleted at some of the other manufacturing units.

8. COST FOCUS AND SUPPLY CHAININITIATIVES

To ensure that a cost effective and efficient supplychain supports the business, a full scale end to endstudy on optimizing supply chain efficiencies wasundertaken with the support of KPMG. The scopeof this work comprised the identification andprioritisation of key initiatives to derive benefitsout of efficient purchase of raw materials,manufacturing and distribution logistics, andimproved sales and operations plans aimed atevolving the most efficient supply chain andimproved customer service levels.

Currently, work is under way on 14 projects thatwill yield significant process improvements andopportunities for optimisation. The endeavour isto establish best in class processes to achieve theseobjectives and institutionalise them.

The focus on cost control yielded savings ofRs. 202 mn in 2004-05, partly as a result of theopportunities identified in the supply chain studyand partly from ongoing process improvements inthe business. For the first time, your Companydeveloped and implemented a commodities buyingstrategy for managing input costs.

9. QUALITY STANDARDS

The high quality standards for all "Britannia"brands are the hallmark of the quality policy ofyour Company. Continuous efforts are always onto improve product and pack quality based onproduct testing and consumer feedback.

All factories follow the well proven qualityassurance systems, such as ISO 9001-2000 andHACCP. The quality organisation of your Companyensures strict adherence to these systems throughregular audits and visits by senior managers to thevarious manufacturing locations and stockingdepots.

10. INFORMATION TECHNOLOGY

Your Company has continued its thrust intechnology investment and during the year alldepots and production centres have been connectedand integrated with the centralised SAP data centrein the corporate office at Bangalore, resulting inoptimization of many of our business processes,like invoicing and sales accounting, ordering andpayment, and better receivables management.

We have also upgraded our communication softwarethereby leveraging technology to improve the speedof communication between all Britannia offices,vendors, suppliers and manufacturing units.Investment has been made to improve uptime anddata security, enhance speed of operation andflexibility to increase bandwidth on demand.

We have also implemented a common invoicingand accounting package across key distributors thatwill enable us to have online secondary salesinformation. Plans are in place to roll out thispackage to other distributors across the countryduring the year.

Another milestone achieved during the year was thecreation of a centralised set-up for payables processing,accounting and MIS systems in the corporate office atBangalore. This will significantly improve turnaroundtime and overall efficiency of back-end systems,thereby improving customer satisfaction to our valuedsuppliers and channel partners.

I I . ENVIRONMENT AND SAFETY

Your Company believes in conservation and thereis a continuous thrust on conservation of energyand reduction of wastage across manufacturingcentres. An example is use of alternate fuels toimprove efficiency and cost effectiveness.

Investment in safety measures continues across allmanufacturing units and the year ended with' noaccidents reported from any unit.

12. TSUNAMI RELIEF

The entire Britannia family responded to the processof relief and rehabilitation by voluntary donationsfrom employees that were matched with cashcontribution by the Company and given to theIndian Red Cross Society. The Company alsosupplied products and other articles of need to theaffected people.

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13. ENERGY, TECHNOLOGY AND FOREIGNEXCHANGECXVV*l •^^•™%*t

Details of energy conservation, technology absorptionand foreign earnings and outgo in accordance withthe provisions of Section 217(l)(e) of the CompaniesAct, 1956, read with the Companies (Disclosure of theParticulars in the Report of Board of Directors) Rules,1988, are given as an annexure to the Directors' Report.

14. CORPORATE GOVERNANCE

Your Company has not only complied with allprovisions of corporate governance as prescribedunder the listing agreements of the stock exchangeswith which the Company is listed, but also is in theprocess of establishing its own code of conductand corporate governance.

A separate report on corporate governance alongwith the Auditors' statement on its compliance isattached to this Report.

15. DIRECTORS

Field Marshal Sam Manekshaw, Mr. S.S. Kelkar andMr. P. C. Khanna retire by rotation at the forthcomingAnnual General Meeting and are eligible forreappointment. Field Marshal Sam Manekshaw hasinformed the Company that he does not want to seekreappointment to the Board in view of his age. TheBoard is especially grateful to him for the manycontributions he has made in the 12 years ofassociation as a Board Member as well as the Chairmanand member respectively of the Audit andRemuneration Committees. Your Company and itsBoard of Directors have been honoured by hispresence, benefited from his wisdom and learnt fromthe unique perspective he brings to every situation.

1 6. APPOINTMENT OF MANAGER

The Board appointed Ms. Vinita Bali, who joinedas Chief Executive Officer of the Company onJanuary 3, 2005, as Manager under the CompaniesAct, 1956 for a period of five years with effect from24th January, 2005. Her appointment andremuneration are subject to your approval at theensuing Annual General Meeting. Ms. Vinita Balibrings with her a rich and diverse experience inpackaged foods and beverages gained from workingwith Cadbury Schweppes and The Coca-ColaCompany in several continents, in a variety ofmarketing, sales and general management positions.She also blends a high quality of Indian andInternational perspective having lived and workedin the UK, Nigeria, South Africa, USA and Chile.

Mr. Nikhil Sen who was appointed as a Managerwith effect from 8th August, 2003 will, consequentupon his resignation, relinquish charge at close ofbusiness hours on 31st May, 2005.

\ 7. PARTICULARS OF EMPLOYEES

Information in accordance with sub-section (2A) ofSection 217 of the Companies Act, 1956, read withthe Companies (Particulars of Employees) Rules,1975, and forming part of the Directors' Report forthe year ended 31st March, 2005 is also given inthe annexure to this report.

18. AUDITORS

Messrs. Lovelock & Lewes who are willing tocontinue in office are recommended forreappointment as the Company's Auditors for theensuing year also.

19. DIRECTORS' RESPONSIBILITY

Pursuant to sub-section (2AA) of Section 217 ofthe Companies Act, 1956, your Directors, based onthe representations from the operating management,confirm that :

i) In the preparation of the annual accounts, theapplicable Accounting Standards have beenfollowed and that there are no materialdepartures;

ii) They have, in selection of the accounting policies,consulted the statutory auditors and applied themconsistently, making judgements and estimatesthat are reasonable and prudent so' as to give a trueand fair view of the state of affairs of the Companyat the end of financial year and of the profit of theCompany for that period;

iii) They have taken proper and sufficient care tothe best of their knowledge and ability for themaintenance of adequate accounting recordsin accordance with the provisions of theCompanies Act, 1956 for safeguarding theassets of the Company and for preventing anddetecting fraud and other irregularities;

iv) They have prepared the annual accounts on agoing concern basis.

20. ACKNOWLEDGEMENTS

The Directors would like to thank all stakeholders,namely, shareholders, customers, dealers, suppliers,bankers, employees and all other business associatesfor the continuous support given by them to theCompany and its management.

On behalf of the Board

/^yC .XA"1 i v *s ,«^x7«Sp\ fj i^.f vx *- * B ffr^rtxr<a>— m^2* ^

/Nusli N. Wadia

26th May, 2005 Chairman

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2oon4-a2ooe5port ANNEXURE TO THE REPORT OF THE DIRECTORS

Information under Section 217 (1) (e) of the CompaniesAct, 1956 read with Companies (Disclosure of Particularsin the Report of Board of Directors) Rules, 1988.

A. CONSERVATION OF ENERGY

(a) Energy conservation measures taken :

i) Utilisation of low cost heavy fuel oil andgaseous fuel for baking in place of LDO.

ii) Extension of "Waste Heat Recycling &Recovery Technology" in baking ovens.

iii) Substitution of Air Atomised Burners withPressure Jet Burners to improve specific fuelconsumption.

iv) Improving on oven throughput per hour and .per unit of baking surface area to match withinternal/international bench marking.

v) Optimisation of electricity consumption by :

- Substitution of centralised air-conditioningsystem with spot cooling at manufacturingcentres

- Right sizing of different drive motorso c?

- Substitution of eddy-current drives byfrequency controlled drives; and

vi) Substitution of cooling towers for captivegeneration by coil coolers to improve thegenerator loading.

(b) Steps being taken to reduce energy consumption :

i) Modification of Oven Designs to improvespecific fuel consumption.

ii) Extension of waste heat recovery and recyclingsystem in a phased manner in the baking ovens.

iii) Usage of natural gas and other liquid alternatecheaper fuels replacing LDO wherever possible.

(c) Impact of measures taken under (a) & (b) above :

i) Purchase of total electrical energy has reducedby 23.3% while the total production has comedown by 7% as compared to last year.Consequently, consumption of total electricalunits per tonne has reduced by 15.1%.

ii) Specific Fuel Consumption for captivegeneration has improved by 6.3% as comparedto last year.

iii) Total cost of baking fuel has reduced by 17.5%and cost per unit of heat generation has comedown by 11.7%, although there has been a

marginal increase in the specific fuelconsumption by about 0.5%. This is a directfall-out of the usage of cheaper alternate bakingfuel in place of LDO. Heavy fuel oil hascomparatively higher impurities with respect toLDO.

POWER AND FUEL CONSUMPTION

For the year ended 31st March, 31st March,2005 2004

Electricitya) Purchased (gwh) 10.64 13.87

Total amount (Rs mn) 50.42 66.76Rate/Unit (Rs./kwh) 4.74 4.81(lgwh= 1,000,000 kwh)

b) Own Generation

i) Through Diesel Generator(gwh) 1.41 1.40Unit per Litre of Diesel oil(kwh/Litre) 3.39 3.19Cost/Unit (RsAwh) 6.31 5.21(Igwh = 1,000,000 kwh)

ii) Furnace OilQuantity (KL) Nil NilTotal Cost (Rs. Mn) Nil NilAverage Rate (Rs./KL) Nil Nil

iii) Other Internal GenerationQuantity (Billion btu) 173.51 185.81Total Cost (Rs. Mn.) 70.49 85.49Rate/Unit (Rs./therm) 40.63 46.01

Consumption per Unit of ProductionBakery ProductsElectricity (kwh/mt)* 193.80 228.35Furnace Oil (Therms/mt)* Nil NilBaking Fuel (Therms/mt)* 27.91 , 27.78

* Of Equivalent Production

B. TECHNOLOGY ABSORPTION

Details of efforts made in technology absorptionare given below.

Research and Development (R & D)

1. Core areas of Research by the Company

i) Optimisation of process technology and"formulations for minimisation of cost and tomeet the pricing requirements of the consumer.

ii) Achieving wastage reduction, qualityconsistency and cost reduction throughimproved process technology.

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Itffflj^ffitl 7Cat Healthy, Think Better



iii) Development of innovative products throughconstant search for new ingredients, equipmentand process technology.

iv) Standardisation of processes and procedures tomeet product consistency.

v) Improvement of product shelf life, safety,convenience and consumer appeal throughimproved packaging.

2. Benefits derived as a result of above R & Dinitifiti VP<J*lllll-lCltrl V Wk>«

i) New products developed :

- Duet treat - Strawberry- Vanilla- Duet treat - Orange-Chocolate- Jam Treat - Orange- Tiger Orange Cream- Cup cake- Pineapple and Chocolate cakes- Renovation of Goodday variants, Treat

variants, 50 - 50 and Tiger Coconut

ii) Implementation of alternate fats/oils and otheringredients for cost competitiveness.

iii) Quality assurance and creation of a safe andcleaner working environment in the factories.

iv) Cost reduction through better formulation,process control and packaging.

3. Future plan of action :

i) Development of value added and morenutritious products to satisfy consumerexpectations.

ii) Continuous innovation in process technologyand packaging to reduce cost.

iii) Use of new ingredients for developing productswith better nutritive value, taste and costcompetitiveness.

iv) Constant endeavour towards development ofmore environment friendly process technology.

4. Expenditure on R&D

31st March,2005

Rs. mn

Capital 1.87

Recurring 18.96

Total 20.83

Technology absorption, adaptation and innovation

A. Efforts, in brief, made towards technologyabsorption, adaptation and innovation.

i) Adaptation of latest research findings, tools andhigh-end instrumentation to develop betterprocess technology and products.

ii) Interactions with research Institutes of Nationaland International repute to update thetechnology.

iii) Upgradation of process technology andequipment for improvement in quality andefficiency of operations.

B. Benefits derived as a result of the above effort:

i) Introduction of new products

ii) Major initiatives resulting in reduction ofmaterial costs

iii) Improvement in process output yields acrossvarious product lines

iv) Optimisation and reduction of energyconsumption

v) Development of improved packaging materials.

C. FOREIGN EXCHANGE EARNINGS ANDOUTGO

Activities relating to exports:

i) The Company is actively pursuingdevelopment of new export markets for its coreproducts.

ii) Total foreign exchange used and earned:

31st March,2005

Rs. mn

Foreign Exchange Used 462.53

Foreign Exchange Earned 399.77

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STATEMENT OF PARTICULARS OF EMPLOYEES FORMING PART OF THE DIRECTORS' REPORT

SI.No.

1

A.

1

2

3

4

5

6

7

8

B.

1

2

3

4

56

7

8

9

Name

2

Age

3

Designation/Nature of duties

4

RemunerationReceived/ReceivableRupees

5

Net take homepay after tax &P.F deductionsRupees

6

Qualification Experience Date of Previous EmploymentEmployment held

7 8 9 10

Employed throughout the year under review and were in receipt of remuneration aggregating not less than Rs. 2,400,000/- per annum

Aurora G S

Banerjee G

Chakraborty S K

Gupta A K

SenN

Shyam Sunder P

TiwariV

Wakhle Rajiv

56

51

48

50

46

54

47

46

GM-BakeryOperationsGM-Materials

GM-BakeryOperations

GM-Accounts &Planning

Chief OperatingOfficerGM-ISD & Logistics

GM-BakeryOperationsHead of ProductDevelopment

2,977,949

2,662,862

3,087,705

3,112,001

7,100,071

3,285,991

2,840,739

3,173,123

1,774,014

1,575,886

1,898,077

1,878,217

3,944,502

1,953,089

1,688,462

1,929,351

B.E. (Mech),DSQC&ORB.E.(Mech).M.Tech(ffi&OR)

B.Sc(Hons)M.Sc(Food Tech)

B.Com. A.C.A

B.A.(Hons.)DBA

B.Tech.PGDIE,POPE

B.Tech(Mech)DBMB.E.(Mech.)

34

28

25

26

26

31

26

24

15-Sep-78

2-Aug-82

12-Nov-87

29-Dec-86

l-Jul-80

26-Apr-91

2-Jul-79

4-Jun-Ol

Chief Executive- QualityMalhotra International Ltd.Manager - Raw MaterialsDunlop India Ltd.

Quality Assurance ExecutiveGlindia Ltd.

Chief AccountantMalhotra Distributors (P) Ltd.

Research Executive-MarketingResearch & Advisary ServicesResident Internal Auditor -TELCO_

Tiffany Foods Ltd. UAE

Employed for part of the year under review and were in receipt of remuneration aggregating not less than Rs. 200,0007- per month.

ArteV

BaliV

Chopra N L

Harikrishna B

KaulV

LalRK

Rajagopalan J

Ramesh Shankar S

Shridhar N

43

49

45

47

4855

53

46

39

VP&HeadofMarketing

Chief ExecutiveOfficer

GM-Marketing

GM-HumanResourcesHead - Technical

VP&HeadofOperationsGM - Treasury &TaxationGM&HeadofHuman Resources

Chief FinancialOfficer

1,138,553

•3,130,575

2,076,151

201,926

3,615,130997,723

2,386,155

528,665

7,252,610

709,398

1,622,008

1,453,263

190,056

2,312,724

583,439

1,555,537

372,547

4,242,212

M.B.A

M.B.A

B.A.

B.Com PGDIR

B.Tech(Chem)

B.Tech(Chem) Masterof Applied Sciences

FCAJTCWAJCS

M.A.,PGDMLL.B

ACMA (London),AICWA,PGDMS

19

25

24

25

2633

29

23

18

14-Feb-05

3-Jan-05

16-May-88

5-Nov-99

16-Jul-79

7-Jan-05

l-Sep-77

l-Mar-05

8-Apr-04

Director-Sales & Mass MarketCadburys India Ltd.

Managing PrincipalZyman Group, USA

ManagerChandralok Engg. Pvt. Ltd.

GM-Human ResourcesFord India Ltd.-Usha Martin International,Texas, USA

Accountant - CostEnfield India Ltd.

Chief ExecutiveSpan Eicher Designs Ltd.V P (Operations Finance)Coca-Cola India Inc.

Remuneration received/receivable relates to the year ended 31st March, 2005 and has been calculated in compliance with the relevant provisions under the CompaniesAct, 1956. All appointments are/were contractual. Other terms and conditions are as per Company rules. No employee is a relative of any director of the Company.

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BRITANNIAEat Heathy, mnK Better


2onon4U-a2005port MANAGEMENT DISCU

A) INDUSTRY STRUCTURE ANDDEVELOPMENT

The organised and branded biscuit industry in Indiais currently estimated at around 900,000 tonneshaving grown 12% last year, as compared to the 7%growth of the FMCG sector. New players haveentered the market at the national and regional level,making the industry dynamic and very competitive.Aggressive pricing activity, trade and consumerpromotions have pulled down the overall pricingpower of brands in the market, calling for strongmargin management measures to sustainprofitability. In the last year alone, key input costshave increased by 12-15%.

Per capita consumption continues to grow across allage groups and socio-economic strata. Biscuits continueto maintain their position as one of the most widelydistributed and available packaged food categories inIndia. 38% of the total volume comes from the ruralmarkets though this number varies by type of biscuit,with glucose being the most widely distributed in ruralmarkets at 50% of overall sales. The market has alsomigrated towards bulk and family packs that offer bettervalue for money on a per kg basis.

B) BUSINESS STRATEGY

The essence of your Company's strategy is toidentify the high value opportunities, and deliveragainst those through relevant and differentiatedbrands, supported by an effective and efficientsupply chain.

The thrust of this strategy lies in brand building -to increase consumer relevance, preference andpurchase. The key drivers are availability, presence,and merchandising for brands that offer consumersa satisfying experience across a variety ofconsumption occasions and price points thatrepresent good value for money.

Profitable growth will come from fortifying existingbrands and tapping into new consumer segments,and new purchase and consumption occasionsthrough a mix of product and packaging innovationand renovation. Expanding the footprint of powerbrands like Tiger, Good Day, Marie, Milk Bikis,50:50 and Treat will continue to be a key priority.

The Company will continue its focus on increasingthe width and depth of distribution in urban andrural markets. The rapidly expanding modern tradechannel also presents a new growth opportunityand the sales and distribution infrastructure is beingaligned to service this effectively. The overall goal

10 l»1'jjfc**m2EitHeMhy,

SSION AND ANALYSIS

is to strengthen Britannia's position as the mostsignificant player in the biscuit market and increaseits share of consumer spend in this category through amore profitable brand-package-price and channel mix.

On the cost side your Company has significantlystrengthened it supply chain initiatives and isworking towards capacity expansion that is moreefficient. Towards that objective, the start up of thenew manufacturing unit at Uttaranchal in April 2005is a major step.

C) SEGMENT-WISE PERFORMANCE

The primary business segment of the Company isbakery, which consists of biscuits, bread and cakes.Overall sales have improved by 11% in volumeand 10% in value during the year:

• Biscuit volume grew 12% and value 10%.• Bread volume grew 4% and value 6%.• Cake and Rusk volume .grew 28% and

value 24%.

D) OUTLOOK

The biscuit market will become increasinglycompetitive with new national and regional playersexpanding their manufacturing capacity and marketpresence. Several of the new players will also investheavily in promotional and pricing support to gainshare. This is likely to exert a downward pressure onprices especially for the large and dominantcategories like glucose, milk biscuits, creams etc.

On the other hand raw material, packaging materialand transportation costs are likely to increase andthe key challenge will therefore be to manageprofitability without increasing price. Critical costareas are being addressed to achieve this task -including the structural cost of the business, inaddition to innovations aimed at enhancingmargins through mix management.

E) FINANCIAL AND OPERATIONALPERFORMANCE

During the year 2004-05, operating marginsimproved from 10.05% to 10.20% largely throughoperational effectiveness and cost management.

Rs. 432 million was spent on additions to fixedassets and capital work-in-progress with a view toenhancing production capacity.

The Company has booked Treasury income ofRs. 648 million during the year.

The Company's Commercial Paper short-term debtand non-convertible debentures continue to enjoy®

UBmi* Setter



the highest ratings and it continues to maintain avery strong liquidity profile.

F) RISKS AND CONCERNSYour Company's exposure to price fluctuations on itsmajor raw materials continues, with bulk of them beingagro-based and subject to market price variationsduring the year. Prices of these commodities continueto be linked to both domestic and international priceswhich depend on various external factors like goodmonsoon in the country, imports/exports, internationalcrop size. The setting up of the commodity exchangeand introduction of commodity futures and otherhedge strategies in the country has opened upreasonable opportunities for the Industry to hedgeand possibly minimise the impact of these pricefluctuations. "Your Company has successfullyintroduced various measures like forward buyingstrategy of commodities, supported by tools to forecastfuture trends and hedge against market pricefluctuations to minimize the impact on its profitability.

As evident in the last two years, fuel prices continueto be a big area of concern as fuel is widely used inmanufacturing and distribution operations and hasa direct impact on total costs. The last two yearshave witnessed approximately 22% increase indiesel and petrol costs due to increasing oil pricesin the global markets.

An increasingly competitive market has curtailedthe ability to take price increases and in fact overallbiscuit prices have remained flat for the last 3-4 years.With significant enhancements in overall biscuitcapacity in tax advantaged regions like Uttaranchal,there is a high likelihood of reducing consumerprices, common in a number of other categories,which will further squeeze margins. Your Companyhas taken various steps aimed at controlling costand others aimed at developing a high margin mixto tap into new opportunities to counter this threatand strengthen its position in the market place.

G) INTERNAL CONTROL SYSTEMS ANDADEQUACY

The Company has an adequate system of internalcontrol relating to purchase of raw materials,components, plant and machinery, equipment andother assets and for sale of goods commensurate withits size and the nature of its business. The Companyhas also adequate systems and controls for:

• Proper recording and safeguarding of assets.• Maintaining proper accounting records and

reliability of financial information.

The Company also regularly monitors its businessrisk control procedures through Internal Audit,which is continuously reviewed by the AuditCommittee.

Implementation of ERP Package (SAP) has beenextended to all depots and contract packinglocations which have enabled the Company toleverage technology tt^help improve the processand control environment. The centralisation ofvarious functions at Bangalore has also led toimproved levels of efficiency and controls. Thiswill also ensure the Company's ability to meet theenhanced corporate governance objectives throughbetter processes, systems and metrics.

H) DEVELOPMENTS IN HUMAN RESOURCEAND INDUSTRIAL RELATIONSThe Company's Human Resources philosophy isto establish and build a. strong performance drivenculture with greater accountability andresponsibility at all levels. To that extent theCompany views capability as a combination of theright people in the right jobs, supported by the rightprocesses, systems, structure and metrics.

The Industrial Relations climate of the Companyremained cordial during the year and continues to befocused towards improving productivity, quality andsafety. Wage agreements at two of the manufacturingunits have expired and are under negotiation.

The Company owned production facility at Mumbaiwas closed effective March 24, 2004, based on LabourCommissioner's order permitting the same underSection 25(O) of the Industrial Disputes Act, 1947.

A certain section of the employees representing theUnion had approached the Industrial Tribunalagainst the closure of Mumbai factory and the matter* J " J" 1is pending disposal.

1) CAUTIONARY STATEMENTStatements in this "Management Discussion andAnalysis" describing the Company's objectives,expectations or predictions may be forward lookingwithin the meaning of applicable laws and regulations.Actual results could differ materially from thoseexpressed or implied. Important factors that couldmake a difference to the Company's operations includeraw material availability and prices, cyclical demandand pricing in the Company's principal markets,changes in government regulations, tax regimes,economic developments in India and the countries inwhich the Company conducts business and otherincidental factors.

®

(^fflfflfi I IfuHetUy, mr* Better


20oT20oe5port REPORT ON CORPORATE GOVERNANCE

i.

2.

1

]f

COMPANY'S PHILOSOPHY ON CODE OF GOVERNANCE

Your Company considers good Corporate Governance a pre-requisite for meeting the needs and aspirations of itsshareholders and other stakeholders in the Company. With this end in view, this year's Annual Report has maderelevant disclosures on the Board, Board Committees as also on the financial and stock performance.

BOARD OF DIRECTORS

Composition, Attendance at the Board Meetings and the last Annual General Meeting, Outside Directorshipsand Board Committee Memberships.

Above information as at 31st March, 2005 is tabulated hereunder:

Director

Mr. Nusli N Wadia

Mr. Avijit Deb

Mr. A K Hirjee

Mr. Simon Israel

Mr. Nimesh N Kampani

Mr. S S Kelkar

Mr. Pratap Khanna

Field Marshal

Sam Manekshaw M. C.

Mr. John Martin Miller

Mr. Francois-Xavier Roger

No. ofBoard

MeetingsAttended

8

8

7

2

7

8

7

7

5

8

Attendanceat previousAGMon

19.08.2004

Present

Present

Present

Present

Present

Present

Present

Present

Present

Present

No. ofoutside

DirectorshipsHeld*

9

Nil

9

1

9

9

Nil

9

Nil

Nil

No. ofMembership/Chairmanship

in otherBoard

Committees *

2

(Chairman of 1 )

Nil

8

(Chairman of 3)

Nil

5

(Chairman of 2)

5

(Chairman of 1 )

Nil

7

(Chairman of 3)

Nil

Nil

Executive/Non-Executive/Independent

Chairman-

Non-Executive

Non-Executive &

Independent

Non-Executive

Non-Executive

Non-Executive &

Independent

Non-Executive

Non-Executive &

Independent

Non-Executive &

Independent

Non-Executive

Non-Executive

* Excludes alternate directorship and directorship in foreign companies and private companies which areneither a subsidiary nor a holding company of a public company.

# Excludes Committees other than Audit Committee, Shareholders '/Investors' Grievance Committee,Remuneration Committee and of Companies other than Public Limited Companies.

BOARD MEETINGS

During the year under review, 8 Board Meetings were held, the dates being 12th April 2004, 22nd May 2004,>8th June 2004, 20th July 2004, 19th August 2004, 25th October 2004, 24th January 2005 and 28th March 2005.

r~ n

12 P^^^^^SEat Healthy, Think Better



3. BOARD COMMITTEES

(A) AUDIT COMMITTEE:

The Audit Committee was reconstituted during the year under review and it currently comprises Mr. Nimesh N.Kampani (Chairman), Field Marshal Sam Manekshaw M.C., Mr. Francois-Xavier Roger and Mr. Avijit Deb, allbeing Non-Executive Directors.

The role and terms of reference of the Audit Committee include review of Internal Audit Reports and the StatutoryAuditors' Report on the financial statements, general interaction with the Internal Auditors and Statutory Auditors,review of weaknesses in internal controls, selection and establishment of sound accounting policies and review offinancial statements, both annual and quarterly before submission to the Board and other matters specified underclause 49 of the Listing Agreement and Section 292A of the Companies Act, 1956.

During the year under review, six meetings of the Audit Committee were held, the dates being 28th June 2004,20th July 2004, 25th October 2004, 16th December 2004, 24th January 2005 and 25th February 2005.

Mr. Nimesh Kampani took over as the Chairman of the Audit Committee from Field Marshal Sam Manekshaw M.C.at the meeting held on 25th October 2004 and at the Meeting held on 24th January 2005, Mr. Avijit Deb, wasinducted as a member of the Audit Committee.

The attendance of the members at the Audit Committee Meetings was as follows :

Name

Mr. Nimesh N Kampani - Chairman

Mr. Francois - Xavier Roger

Field Marshal Sam Manekshaw M.C

Mr. Avijit Deb (w.e.f. 24.01.2005)

No. of Audit Committee Meetings Attended

5

5

3

2

During the year, the Audit Committee meetings were also attended by other directors namely Mr. S. S. Kelkar on25th October 2004, 16th December 2004, 24th January 2005 and 25th February 2005; Mr. Nusli N Wadia on 28thJune 2004, 25th October 2004, 16th December 2004, 24th January 2005 and 25th February 2005.

Mr. A. K. Hirjee, Director, is a permanent invitee to the Audit Committee meetings and attended five meetings heldduring the year. Manager of the Company/Heads of the Finance functions, Internal Auditor, Statutory Auditors andsuch other Executives as considered appropriate, attend the Meetings.

Mr. J. Rajagopalan acted as the Secretary to the Committee till his resignation on 31st August, 2004 and subsequently,Ms. Nandita Swarup, Legal Manager and Compliance Officer acted in his place.

(B) REMUNERATION COMMITTEE:

The Remuneration Committee comprises three Directors and is headed by Field Marshal Sam Manekshaw M.C.who is an Independent and Non-Executive Director. The composition of the Committee is as follows :

Field Marshal Sam Manekshaw M.C. - Chairman

Mr. Nusli N. Wadia

Mr. Simon Israel

Broad terms of reference of the Remuneration Committee include recommendation to the Board, of salary/perquisites,commission and retirement benefits and fmalisation of the perquisite package payable to the Company's ManagingDirector/Wholetime Directors. There being no Managing Director/Whole-time Director, no RemunerationCommittee meeting was held during the year under review.

BRITANNIA 13

Eat HealthyTThink Better



REMUNERATION POLICY:

Ms. Vinita Bali was appointed as Chief Executive Officer w.e.f. 3rd January, 2005 and as a Manager under Section269 of the Companies Act, 1956 w.e.f. 24th January 2005. The terms and conditions of appointment andremuneration applicable to her were fixed by the Board of Directors of the Company.

The details of remuneration paid to the Managers of the Company were as follows :

Name

Mr. Nikhil Sen

Ms. Vinita Bali

Salary/Benefits (Rs.)

7,061,156

2,493,258

Commission (Rs.)

Nil

Nil

Total (Rs.)

7,061,156

2,493,258

Remuneration to Mr. Nikhil Sen, Manager, as per the terms and conditions approved by the shareholders at theprevious AGM held on 19th August, 2004, comprises basic salary, commission, perquisites and allowances,contributions to provident fund, superannuation and gratuity funds.

The appointment of Mr. Nikhil Sen is for a period of 5 years from 8th August, 2003 and the Company has executedan Agreement dated 12th August, 2003 for the said appointment. Mr. Nikhil Sen has since submitted his resignationfrom the services of the Company and will be relinquishing charge at the closing hours of 31st May, 2005.

Remuneration to Ms. Vinita Bali, Manager as per the terms and conditions approved by the Board and as per theagreement dated 16th May, 2005, comprises basic salary, incentive, allowances, performance award, contributionsto provident fund, superannuation and gratuity funds.

The terms of appointment of and remuneration payable to Ms. Vinita Bali as Manager, are subject to the approvalof the Shareholders of the Company at the ensuing Annual General Meeting.

The Agreement with the Managers is for a period of five years. Either party to the Agreement is entitled to terminatethe Agreement by giving not less than six calendar months, prior notice in writing to the other party; providedhowever that the Company shall be entitled to terminate the incumbent's employment at any time by payment toher of six months' basic salary in lieu of such notice.

The Non-Executive Directors do not draw any remuneration from the Company other than sitting fees and suchcommission on net profits as may be determined by the Board for each year.

Presently, the Company does not have a scheme for grant of stock options either to the Directors or employees.

Details of remuneration to Non-Executive Directors for the year 2004-2005 are given below :

Name

Mr. Nusli N. Wadia

Mr. Avijit Deb

Mr.A.K.Hirjee

Mr. Simon Israel

Mr. Nimesh N Kampani

Mr. S. S. Kelkar

Mr. Pratap Khanna

Field Marshal Sam Manekshaw M.C.

Mr. John Martin Miller

Mr. Francois - Xavier Roger

Sitting Fees (Rs.)

85,000

90,000

112,000

20,000

112,000

113,000

70,000

85,000

50,000

105,000

Commission (Rs.)

4,800,000

661,000

1,321,000

132,000

925,000

1,321,000

462,000

727,000

727,000

925,000

Total (Rs.)

4,885,000

75,1,000

1,433,000

152,000

1,037,000

1,434,000 .

532,000

812,000

777,000

1,030,000

14

The above commission will be paid, subject to deduction of tax after adoption of the accounts by the shareholdersat the Annual General Meeting to be held on 20th July, 2005.

The Non-Executive Directors do not have any other pecuniary relationship or transactions with the Company.

®

BRITANNIAE»t Healthy, Think Better



(C) SHARE TRANSFER & SHAREHOLDERS'/INVESTORS' GRIEVANCE AND ETHICS/COMPLIANCECOMMITTEE:

The Share Transfer & Shareholders'/Investors' Grievance and Ethics/Compliance Committee presently comprises3 Directors, namely:

Mr. A. K. Hirjee - Non-Executive Director - ChairmanMr. S. S. Kelkar - Non-Executive DirectorMr. Nimesh N. Kampani - Non-Executive Director

This Committee:

i. approves and monitors transfers, transmission, splitting, consolidation and rematerialisation of securities andissue of duplicate securities certificates by the Company;

ii. looks into various issues relating to shareholders including redressal of complaints relating to transfer ofshares, non-receipt of Balance Sheets, Dividends, etc.; and

iii. ensures compliance of the Code of Conduct for- Prevention of Insider Trading formulated by the Company asper the Securities and Exchange Board of India Regulations.

The Committee, which generally meets twice a month, met 24 times during the year.

The Company has not delegated the powers to approve share transfers etc., to any officer of the Company since theShare Transfer & Shareholders'/Investors' Grievance and Ethics/Compliance Committee meets twice a month andthe process of Share transfer is completed within the stipulated time.

NAME AND DESIGNATION OF COMPLIANCE OFFICER :

Mr. J. Rajagopalan, Acting Company Secretary (upto 31.08.2004)

Ms. Nandita Swarup, Legal Manager (w.e.f 01.09.2004)

No. of Shareholders' complaints received during the year

No. of complaints not resolved to the satisfaction of shareholders

No. of pending share transfers

72

Nil

Nil

The Company has attended to most of the investors' grievances/correspondence within a period of ten days fromthe date of receipt of the same except in cases that are constrained by disputes or legal impediments. There aresome pending cases relating to disputes over title to shares, in which the Company is made a party. However, thesecases are not material in nature.

Shareholders requests for transfer/transmission of equity shares were effected within 15 days from the date ofreceipt. No transfers are pending for registration.

OTHER COMMITTEES OF DIRECTORS:

In addition to the above Committees, the Board has constituted the following Committees :

(a) Executive Committee of the Board - The Executive Committee comprises Mr. Nusli N. Wadia (Chairman) andMr. Simon Israel, both being Non-Executive Directors.

The brief description of the terms of reference of the Executive Committee is to discharge the following functionswhich would otherwise be required to be discharged by the Board, i.e.,

i. discussions with Management on preparation of annual budgetii. periodical review of the performance of the Companyiii. review and approval of any major operational proposal put forth by the Management.

At the Board Meeting held on 20th July, 2004, the Executive Committee was expanded by inducting Mr. A. K.Hirjee and Mr. John Martin Miller as its members.

BRITANNIA 15




The Executive Committee was constituted consequent upon the termination of the services of Mr. S. K. Alagh asthe Managing Director. In view of the appointment of Ms. Vinita Bali as Chief Executive Officer, the Committeewas dissolved at the meeting of the Board of Directors held on 28th March, 2005.

(b) Investment Committee - The Investment Committee comprises Mr. Nusli N Wadia (Chairman), Mr. A. K. Hirjeeand Mr. S. S. Kelkar, all being Non-Executive Directors.

The brief description of the terms of reference of the Investment Committee is to approve investments/disinvestmentsof the funds of the Company within the limits prescribed by the Board from time to time.

During the year under review, several meetings of the Investment Committee were held.

(c) Nomination Committee - The Nomination Committee comprises Mr. Nusli N. Wadia, (Chairman and Non-ExecutiveDirector), Mr. Simon Israel (Non-Executive Director) and Mr. Nimesh N. Kampani, (Non-Executive and IndependentDirector).

The terms of reference of this Committee include identifying and recommending to the Board the appointment ofthe Managing Director/Wholetime Director/Chief Executive Officer of the Company.

During the year under review, the Nomination Committee met several times to identify/shortlist/interview andfinalise candidates for the position of Chief Executive Officer. During the meeting held on 25th October, 2004, theCommittee proposed the appointment of Ms. Vinita Bali as the Chief Executive Officer of the Company to theBoard.

4. GENERAL BODY MEETINGS:

Location and time where last three Annual General Meetings were held:

Date

19th August, 2004

8th August, 2003

6th August, 2002

Location

Hotel Oberoi Grand15, Jawaharlal Nehru RoadKolkata - 700 013.

-do-

-do-

Time

10.30 am

10.30 am

10.30 am

5. POSTAL BALLOT:

During the year under review, consent of the shareholders was obtained by way of postal ballot in terms of Section192 A of the Companies Act, 1956 read with the Companies (Passing of Resolution by Postal Ballot) Rules, 2001for the buy back of maximum of 25,00,000 equity shares of Rs. 107- each at a price not exceeding Rs. 6507- pershare and outflow not exceeding Rs. 760 million by way of Special Resolution under Sections 77A and 77B of theCompanies Act, 1956.

Mr. Samir Ghosh, Ex-Senior Partner of M/s. Lovelock & Lewes, Chartered Accountants was appointed as theScrutiniser by the Board.

The voting pattern was as under:

A

B

C

Particulars

Valid postal ballots in favour of the Resolution

Valid postal ballots against the Resolution

Total valid postal ballot forms received

Invalid postal ballots

No. ofpostal ballots

1,489

280

1,769

474

No. ofvotes/shares

12,560,298

52,273

12,612,571

102,063

Percentage

99.59

0.41

100.00

-

16

®

BRITANNIAEat Healthy. Think Better



6. DISCLOSURES:

(a) Disclosures of materially significant related party transactions, i.e., transactions of the Company of materialnature, with its promoters, the Directors or the Management, their Subsidiaries or relatives etc., that may havepotential conflict with the interests of the Company at large.

None of the related party transactions were in conflict with the interests of the Company at large including therelated party transactions that are disclosed under item (xxiv) of Schedule 6 to the accounts.

(b) Details of non-compliance by the Company, penalties, strictures imposed on the Company by Stock Exchange orSecurities and Exchange Board of India or any statutory authority, on any matter related to capital markets, duringthe last three years:

No penalties/strictures have been imposed on the Company by any regulatory authority for non-compliance ofany laws/regulations relating to capital markets.

7. MEANS OF COMMUNICATION :

Quarterly, Half-Yearly and Annual Results

Quarterly results including half-yearly results are published as per the Listing Agreement in leading newspaperssuch as Financial Express (all editions) and Pratidin (Kolkata edition). The annual audited accounts are likewisepublished. The half-yearly report is not separately sent to each shareholder.

As per requirements of clause 51 pf the Listing Agreement, all the data relating to quarterly financial results,shareholding pattern, etc. are uploaded to the website www.sebiedifar.nic.in.

8. GENERAL SHAREHOLDER INFORMATION

(a) Annual General Meeting - Date, time and venue

20th July, 2005 - 10.30 am at Hotel Oberoi Grand, 15 Jawaharlal Nehru Road, Kolkata - 700 013.

(b) Financial calendar

Period

For the first quarter ending 30th June, 2005

For the second quarter and half year ending30th September, 2005

For the third quarter ending 31st December, 2005

For the year ending 31st March, 2006

Approval of Quarterly results

4th week of July, 2005

4th week of October, 2005

4th week of January, 2006

1 st or 2nd week of June, 2006

(c) Book closure period : 12th July, 2005 to 20th July, 2005, both days inclusive.

(d) Dividend payment date : On and from 21st July, 2005.

(e) Listing on Stock Exchanges : The Company's securities are listed at :

1. The Stock Exchange, Mumbai, Phiroze Jeejeebhoy Towers, Dalai Street, Fort, Mumbai - 400 023.

2. The Calcutta Stock Exchange Association Ltd., 7 Lyons Range, Kolkata - 700 001.

3. National Stock Exchange of India Ltd., Exchange Plaza, 5th Floor, Bandra Kurla Complex, Bandra (East),Mumbai-400 051.

Listing fees as prescribed, have been paid to all the aforesaid Stock Exchanges upto 31st March, 2005.

®


17



(f)

(g)

(h)

Stock Code :

Stock Exchange

The Stock Exchange, Mumbai

Stock Code

825

The Calcutta Stock Exchange Association 38

National Stock Exchange BRITANNIA

Stock Price Data based on closing prices :

Year/Month

2004

April

May

June

July

August

September

October

November

December

2005

January

February

March

Calcutta StockExchange (CSE)

(inRs.)

High Low

638.00 601.50'

No trading No trading

605.00

642.00

640.00

604.95

612.60

640.00



677.10

905.10

677.10

905.10




Bombay StockExchange (BSE)

(inRs.)

High Low

625.60 601.30

608.95 575.05

629.80 570.35

640.50 609.00

672.70 618.55

682.90 660.30

661.20 622.00

751.55 668.15

926.00 757.20

935.35 851.10

933.50 893.65

932.65 840.20

National StockExchange (NSE)

(inRs.)

High Low

625.15 598.30

616.85 576.80

629.65 574.55

640.50 609.40

672.45 620.00

684.20 660.10

663.25 620.80

749.25 669.25

926.55 756.75

931.15 851.80

934.60 890.95

930.60 840.80

Stock Performance : (Comparison on lowest price/index value on the respective dates)

1000 —900 —

800 —

700 ^^V_ 600 aw-w-^**q|g5

1 50° —1 400 —

S 300 — '

£ 200 —

100 —u

™^~ "^~S3 '•§" sCO cr>

Britannia Vs. Sensexll *̂s*»

to*^p**"-'*«s

s § §CSJ <N' -A

1 1 1 1 1

— 8000

*»*"" _ ^**^_yg 7000— 6000

— -5000 „,

— 4000 |

— 3000

— 2000

— 1000

— _ Britannia Sensex

18— — n

• BRITANNIA li^^^^^^^^^^^^^^^^^^^HEat Healthy, Think Better



(i) In terms of Section 205C of the Companies Act, 1956 read with the Investor Education and Protection Fund(Awareness and Protection of Investor) Rules, 2001, the Company has credited during the year ended 31st March,2005 an aggregate amount of Rs. 704,884 to the Investor Education and Protection Fund (IEPF).

(j) Registrar & Transfer Agents & Share Transfer System :

M/s Sharepro Services (India) Pvt. Ltd. are the Registrar and Transfer Agents of the Company for both Physical andDemat Shares and their address is as given below:

REGISTERED OFFICE:

M/s. Sharepro Services (India) Pvt. Ltd.Unit: Britannia Industries LimitedAbove Bank of Baroda,Satam Estate, 3rd Floor,Cardinal Gracious Road, Chakala,Andheri (E), Mumbai - 400 099.Tel No. (022)-2821 5168, 2832 9828, 2821 5991',

2834 7719, 2834 8218.Fax No. (022)-2837 5646E-mail : [email protected]

Ms. Indira P. KarkeraSenior Manager

Share transfers, where documents are found to be in order, were registered and returned in the normal course withina period of two weeks from the date of receipt of the documents. Requests for dematerialisation/ rematerialisationof shares were processed and confirmation was given to the respective depositories i.e. (NSDL) and (CDSL) or tothe shareholders, as the case may be, within, 15 days of receipt.

(k) (i) Distribution of shareholding as on 31st March 2005 :

Group of Shares

1 to 500

501 to 1000

1001 to 2000

2001 to 3000

3001 to 4000

4001 to 5000

5001 to 10000

10001 & above

Total

No. ofShareholders

21,590

615

285

108

49

36

87

90

22,860

No. of Sharesheld

2,240,496

443,987

411,485

263,296

172,682

161,072

590,492

19,606,653

23,890,163

% age toTotal Shares

9.38

1.86

1.72

1.10

0.73

0.67

' 2.47

82.07.

100.00

®


19



(ii) Shareholding pattern as on 31st March 2005 :

Category

A. Promoter's Holding

1 . Promoters- Indian Promoters- Foreign Promoters

2. Persons acting in concert

Sub-Total

B. Non-Promoters holding

3. Institutional Investors

a. Mutual Funds and UTI

b. Banks, Financial Institutions, Insurance Companies(Central/State Government Institutions/Non-Government Institutions)

c. Foreign Institutional Investors (FIIs)

Sub-Total

4. Others

a. Private Corporate Bodies

b. Indian Public

c. NRIs/OCBs

d. Any other

Sub-Total

GRAND TOTAL

No. of SharesHeld

75012,173,219

-

12,173,969

11,716,194

861,938

4,137,370

1,402,489

6,401,797

338,934

4,851,195

120,388

3,880

5,314,397

23,890,163

%ageShareholding

50.96

-

50.96

49.04

3.61

17.32

5.87

26.80

1.42

20.30

0.50

0.02

22.24

100.00

(1) Dematerialisation of Shares: 9,788,360 shares representing 40.97% of the total equity capital were held indematerialised form with the National Securities Depository Limited and Central Depository Services (India) Ltd.as on 31st March 2005.

(m) Outstanding GDRs/Warrants, Convertible Bonds, conversion date and likely impact on Equity: Not applicable.

(n) Plant Locations:

Kolkata

Delhi

Chennai

M umbai .

Uttaranchal

15, Taratola Road, Kolkata - 700 088.

33, Lawrence Road, Delhi - 1 10 035.

M T H Road, Padi, Chennai - 600 050

Reay Road (East), Mazagaon, Mumbai - 400 010.

Plot No. 1 Sector 1, Integrated Industrial Estate (HE), Pant Nagar,Tehsil/Taluk, Rudrapur Kichha, District Udham Singh Nagar,Uttaranchal.

a. Closure of Mumbai Undertaking:

Pursuant to permission under Section 25 (O) of the Industrial Disputes Act, 1947 for closure of manufacturingoperations situated at Reay Road, Mumbai, received from the Labour Commissioner on 23rd March, 2004,production was closed effective 24th March, 2004. Certain section of the employees representing the Union

20

®




have approached the Industrial Tribunal against the closure and the matter is pending disposal.h. Uttaranchal factory:

A new biscuit manufacturing Plant has been commissioned in Uttaranchal and commercial productioncommenced in April 2005.

(o) COMPLIANCE OF NON-MANDATORY REQUIREMENTS

(i) Office of the Chairman of the Board:The Company defrays the expenses of the Non-Executive Chairman's office incurred in the performance of his duties.

(ii) Remuneration Committee:The Company has a Remuneration Committee to determine the remuneration package of the ManagingDirector/ Wholetime Directors.

(iii) Shareholder rights - furnishing of half yearly results :The Company's half yearly results are published in the newspapers and are, therefore, not sent to theshareholders. Based on request from the shareholders, the Company would also provide the quarterly and halfyearly results.

(iv) Postal ballot:The Company complied with the requirements of Postal Ballot and continues to do so as and when such matters,which would require the approval of the shareholders by such process, arise in future in terms of Sec. 192A of theCompanies Act, 1956 read with the Companies (Passing of the Resolution by Postal Ballot) Rules, 2001.

Address for correspondence:

BRITANNIA INDUSTRIES LIMITED BRITANNIA INDUSTRIES LIMITEDRegistered Office: Executive Office:5/1A, Hungerford Street OR Britannia Gardens, Airport Road,Kolkata - 700 017. Vimanapura, Bangalore - 560 017.

On behalf of the Board

Nusli N. Wadia26th May, 2005 Chairman

Auditor's Certificate on compliance with the conditions of Corporate GovernanceUnder Clause 49 of the Listing Agreements

To the Members ofBritannia Industries LimitedWe have examined the compliance of conditions of Corporate Governance by Britannia Industries Limited during theyear ended 31st March 2005, as stipulated in Clause 49 of the Listing Agreement(s) of the said Company with the StockExchange(s) in India.The compliance of conditions of Corporate Governance is the responsibility of the Management. Our examination waslimited to procedures and implementation thereof, adopted by the Company for ensuring the compliance of theconditions of Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements ofthe Company.In our opinion and to the best of our information and according to the explanations given to us, and the representationsmade by the Directors and the Management, we certify that the Company has complied with the conditions of CorporateGovernance as stipulated in the above mentioned Listing Agreement(s).We state that as per the records maintained by the Company, no investor grievance(s) is remaining unattended/ pendingfor a period exceeding one month.We further state that such compliance is neither an assurance as to the future viability of the Company nor theefficiency or effectiveness with which the Management has conducted the affairs of the Company.

Usha A. NarayananPartner

Membership Number 23997

for and on behalf ofPlace: Mumbai Lovelock & LewesDate : 26th May, 2005 Chartered Accountants

BRITANNIA 21

Eat Healthy7Think Better


2onoT2ooe5port AUDITORS' REPORT

To the Shareholders of Britannia Industries Limited

1. We have audited the attached Balance Sheet ofBritannia Industries Limited as at 31st March, 2005the Profit and Loss Account and the Cash FlowStatement for the year ended on that date, annexedthereto which we have signed under reference tothis report. These financial statements are theresponsibility of the Company's management. Ourresponsibility is to express an opinion on thesefinancial statements based on our audit.

2. We conducted our audit in accordance withauditing standards generally accepted in India.Those Standards require that we plan and performthe audit to obtain reasonable assurance aboutwhether the financial statements are free of materialmisstatement. An audit includes examining, on atest basis, evidence supporting the amounts anddisclosures in the financial statements. An auditalso includes assessing the accounting principlesused and significant estimates made bymanagement, as well as evaluating the overallfinancial statement presentation. We believe thatour audit provides a reasonable basis for ouropinion.

3. As required by the Companies (Auditor's Report)Order, 2003, as amended by the Companies(Auditor's Report) (Amendment) Order, 2004, issuedby the Central Government of India in terms of sub-section (4 A) of Section 227 of The Companies Act,1956' of India (the 'Act') and on the basis of suchchecks of the books and records of the Company aswe considered appropriate and according to theinformation and explanations given to us, we givein the Annexure a statement on the matters specifiedin paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referredto in paragraph 3 above:

(a) we have obtained all the information andexplanations which to the best of ourknowledge and belief were necessary for thepurposes of our audit;

(b) in our opinion, proper books of account havebeen kept by the Company as required by lawso far as appears from our examination of thosebooks;

(c) the Balance Sheet, Profit and Loss Accountand Cash Flow Statement dealt with by thisreport are in agreement with the books ofaccount;

(d) in our opinion, the Balance Sheet, Profit andLoss Account and Cash Flow Statement dealtwith by this report comply with the AccountingStandards referred to in Section 211(3C) ofthe 'Companies Act, 1956', of India (the 'Act'),to the extent applicable;

(e) On the basis of written representationsreceived from the Directors, as on 31st March,2005 and taken on record by the Board ofDirectors, we report that none of the Directorsis disqualified as on 31st March, 2005 frombeing appointed as a Director in terms of clause(g) of sub-section (1) of Section 274 of theAct'

(f) In our opinion and to the best of ourinformation and according to the explanationsgiven to us, the said financial statementstogether with the notes thereon and attachedthereto, give in the prescribed manner theinformation required by the Act and give atrue and fair view in conformity with theaccounting principles generally accepted inIndia;

(i) in the case of the Balance Sheet, of thestate of affairs of the Company as at 3 1 stMarch, 2005; and

(ii) in the case of the Profit and Loss Account,of the profit of the Company for the yearended on that date.

(iii) in the case of Cash Flow Statement, ofthe cash flows for the year ended on thatdate.


Membership Number - 23997

For and on behalf ofPlace : Mumbai Lovelock & LewesDate : 26th May, 2005 Chartered Accountants

*

-

-_ ®

22 Itflfflj^ffil^



2onon4-a20Roe5port ANNEXURE TO THE AUDITORS' REPORT

Referred to in paragraph 3 of our report of even date onthe accounts for the year ended 31st March, 2005, ofBritannia Industries Limited.

1 . (a) The Company has maintained proper recordsto show full particulars including quantitativedetails and situation of fixed assets.

(b) The fixed assets*are physically verified by themanagement according to a phasedprogramme designed to cover all the itemsover a period of three years, which in ouropinion, is reasonable having regard to thesize of the Company and the nature of its assets.Pursuant to the programme, a portion of thefixed assets has been physically verified bythe management, during the year and nomaterial discrepancies between the bookrecords and the physical inventory have beennoticed.

(c) In our opinion and according to theinformation and explanations given to us, asubstantial part of fixed assets has not beendisposed of by the Company during the year.

2. (a) The inventory (excluding stocks with thirdparties) has been physically verified by themanagement during the year. In respect ofinventory lying with third parties, these havesubstantially been confirmed by them. In ouropinion, the frequency of verification isreasonable.

(b) In our opinion, the procedures of physicalverification of inventory followed by themanagement are reasonable and adequate inrelation to the size of the company and thenature of its business.

(c) On the basis of our examination of the inventoryrecords, in our opinion, the Company ismaintaining proper records of inventory. Thediscrepancies noticed on physical verification ofinventory as compared to book records were notmaterial.

3. (a) The Company has not granted any loans,secured or unsecured, to companies, firms orother parties listed in the Register maintainedunder Section 301 of the Act, and accordingly,clauses (iii)(b), (iii)(c) and (iii)(d) of paragraph4 of the Order are not applicable.

(b) The Company has not taken any loans,secured or unsecured, from companies, firmsor other parties covered in the register

maintained under Section 301 of the Act, andaccordingly, clauses (iii) (f) and (iii) (g) ofparagraph 4 of the Order are not applicable.

4. In our opinion and according to the informationand explanations given to us, having regard to theexplanation that certain items purchased are ofspecial nature for which suitable alternative sourcesdo not exist for obtaining comparative quotations,there is an adequate internal control systemcommensurate with the size of the Company andthe nature of its business for the purchase ofinventory, fixed assets and for the sale of goods andservices. Further, on the basis of our examination ofthe books and records of the company, andaccording to the information and explanationsgiven to us, we have neither come across nor havebeen informed of any continuing failure to correctmajor weaknesses in the aforesaid internal controlsystem.

5. (a) In our opinion and according to theinformation and explanations given to us, theparticulars of contracts or arrangementsreferred to in Section 30 1 of the Act have beenentered in the register required to bemaintained under that section.

(b) In our opinion and according to theinformation and explanations given to us, thetransactions made in pursuance of suchcontracts or arrangements and exceeding thevalue of Rupees Five Lakhs in respect of anyparty during the year, have been made at priceswhich are reasonable having regard to theprevailing market prices at the relevant time.

6. The Company has not accepted any deposits fromthe public under the provisions of Sections 58Aand 58AA of the Act and the rules framedthereunder.

7. In our opinion, the Company has an internal auditsystem commensurate with its size and nature of itsbusiness.

8 . The Central Government of India has not prescribedthe maintenance of cost records under clause (d) ofsub-section (1 ) of Section 209 of the Act for any ofthe products of the Company.

9. (a) According to the information andexplanations given to us and the records ofthe Company examined by us, in our opinion,the Company is regular in depositing theundisputed statutory dues including providentfund, investor education and protection fund,

®

flflffl^ffiT^ 23

Cat Healthy, Think Better



employees' state insurance, income-tax, sales- explanations given to us and the records oftax, wealth tax, service tax, customs duty, the Company examined by us, the particularsexcise duty, cess and other material statutory of dues of income-tax, sales-tax, wealth tax,dues as applicable with the appropriate service tax, customs duty, excise duty and cessauthorities. as at 31st March, 2005 which have not been

„, A ,. ., . f .. , deposited on account of a dispute, are as(b) According to the information and r ^ K

follows -

Rs.'OOONameof thestatute

ExciseDuty Act

AgriculturalProductMarketCess Act

SalesTax Act

Nature of dues

Excise DutyMatters

APMC(AgriculturalProduceMarketingCorporation)

Sales Tax /Purchase TaxMatters

,

Amount

5,586401

2,7972,9376,6411,195

5039

460343

1,202

51,518

16

5,759133

2,2986,8711,348

3317,007

4841,1412,3881,5152,4662,341

4981,1617,421

20,2752

2,105

Period towhich theamountrelates

From To

200119961996199819951996

"19971997199819982000

1989

1997

1997199819992000200120021996199819992000200119971998199920002001200219972000

20011996199819981999199719971998199819992001

2004

1998

1998199920002001200220031997199920002001200219981999200020012002200320032001

Forum where the dispute is pending

HighCourt

•

51,518

16

Tribunal

5,586

5,759133

2,2986,8711,348

3317,007

Commissioner/Dy. Com.Appeals

4012,7972,937

4841,1412,3881,515

Commissioner/Jt. Comm./Dy. Comm./Asst Comm.

6,6411,195

5039

460343

1,202

2,4662,341

4981,1617,421

20,275

AssessingOfficers/

Superint-endent

22,105

24

(R)

fflfflfl^Ttl




Rs.'OOO

Nameof thestatute

EntryTax Act

IncomeTax Act

Nature of dues

Entry TaxMatters

Income TaxMatters

Amount

22,9064,836

8191,410

10247

1,263366

5,130397

2,4052,0997,895

14,5423,137

Period towhich theamountrelates

From To

200319931997199819992000

197819851986198719921986199219972000

200419961998199920002001

197919861987198819931987199319982001

Forum where the dispute is pending

HighCourt

22,906

1 ,263'366

5,130397

2,405

Tribunal

2,0997,895

14,542

Commissioner/Dy. Com.Appeals

4,836819

1,41010247

3,137

Commissioner/Jt. CommJDy. CommJAsst Comm.

AssessingOfficers/Superint-

endent

10. The Company has no accumulated losses as at31st March, 2005 and it has not incurred any, cashlosses in the financial year ended on that date or inthe immediately preceding financial year.

11. According to the records of the Company examinedby us and the information and explanation givento us, the Company has not defaulted in repaymentof dues to any financial institution or bank ordebenture holders as at the balance sheet date.

12. In our opinion, the Company has maintainedadequate documents and records in the cases wherethe Company has granted loans and advances onthe basis of security by way of pledge of shares,debentures and other securities other than employeehousing loans which are unsecured.

13. The provisions of special statute applicable to chitfund and nidhi/mutual benefit fund/society are notapplicable to the Company.

14. In our opinion, the Company is not a dealer or traderin shares, securities, debentures and otherinvestments.

15. In our opinion and according to the informationand explanations given to us, the terms andconditions of the guarantees given by the Company,for loans taken by others from banks or financialinstitutions during the year, are not prejudicial tothe interest of the Company. Reference is drawn toNote (xi) of Schedule 6 of the Notes on Accountsfor claim on Corporate Guarantee given to anothercompany.

16. The Company has not obtained any term loans.

17. On the basis of an overall examination of thebalance sheet of the Company, in our opinion andaccording to the information and explanationsgiven to us, there are no funds raised on a short-term basis which have been used for long-terminvestment.

18. The Company has not made any preferentialallotment of shares to parties and companies coveredin the register maintained under Section 301 of theAct during the year.

19. The Company has not issued any debentures duringthe year.

20. The Company has not raised any money by way ofpublic issue during the year.

21. During the course of our examination of the booksand records of the Company, carried out inaccordance with the generally accepted auditingpractices in India, and according to the informationand explanations given to us, we have neither comeacross any instance of fraud on or by the Company,noticed or reported during the year, nor have webeen informed of such case by the management.


Membership Number - 23997

For and on behalf ofPlace: Mumbai Lovelock & LewesDate : 26th May, 2005 Chartered Accountants

®

BRITANNIA£at Healthy, Think Better

25


zSSwooT* BALANCE SHEET

As at

SOURCES OF FUNDSSHAREHOLDERS' FUNDS

CapitalReserves and Surplus

LOAN FUNDSSecured

DEFERRED TAX LIABILITY

APPLICATION OF FUNDSFIXED ASSETS

Gross BlockLess : Depreciation & AmortisationNet BlockCapital Work-in-Progress

INVESTMENTS

DEFERRED TAX ASSET

CURRENT ASSETS, LOANS AND ADVANCESInventoriesSundry DebtorsCash and Bank BalancesOther Current AssetsLoans and Advances

Less :CURRENT LIABILITIES AND PROVISIONS

LiabilitiesProvisions

NET CURRENT ASSETS

MISCELLANEOUS EXPENDITURE (to the extentnot written off or adjusted)

NOTES

31st March,Schedule 2005

Rs. '000

A 238,902B 4,196,341

4,435,243C

61,379

170,600

4,667,222

2,503,4631,543,940

D 959,523317,007

1,276,530

E 3,300,767

137,084

F 1,342,237G 427,764H 163,062I 1,847J 708,720

2,643,630

K 2,059,717L 973,431

3,033,148(389,518)

M 342,359

4,667,222

N

3 1 st March,2004

Rs. '000

251,1214,059,1334,310,254

391,865

202,472

4,904,591

2,735,0891 ,460,6701,274,419

8,6071,283,026

2,913,159

131,417

1 ,222,464191,13670,827

4,389779,375

2,268,191

1,372,980781,228

2,154,208113,983

463,006

4,904,591

In terms of our report of even date Chairman Nusli N. WadiaDirectors Avijit Deb

Usha A. Narayanan A. K. HirjeePartner S. S. KelkarMembership Number : 23997 Pratap Khanna

For and on behalf of Field Marshal Sam Manekshaw> M-C

Lovelock & Lewes Nimesh Ka«»Pani

Chartered Accountants John MillerFrancois-Xavier Roger

Mumbai Chief Executive Officer Vinita Bali26th May, 2005

Chief Financial Officer N. Shridhar

,

26 fifWMat2Eat Healthy,

®

kpjThink Better


2004-a2oRoe5port PROFIT AND LOSS ACCOUNT

For the year ended

INCOMEGross SalesLess : Excise Duty (Net)

Net Sales

Other Income

31st March,Schedule 2005

Rs. '000

16,154,485278,787

15,875,698

1 791,930

16,667,628

EXPENDITUREConsumption of Materials 2 7,358,693Salaries, Wages, Bonus, Commission, Allowances, etc. . 586,096Depreciation & Amortisation 189,707Expenses 3 6,112,565

14,247,061

PROFIT BEFORE TAX AND EXCEPTIONAL ITEMS 2,420,567Exceptional Items 4 218,160

PROFIT BEFORE TAX 2,202,407Provision for Tax 5 714,712

PROFIT AFTER TAXProfit Brought ForwardTransfer from Debenture Redemption Reserve

Reversal of Proposed Dividend of previous year(Refer note vii (b) of Schedule N)

PROFIT AVAILABLE FOR APPROPRIATION

APPROPRIATION

PROPOSED DIVIDEND AND TAX THEREONFinal Dividend @ 140%Tax on Dividend

TRANSFERRED TO GENERAL RESERVE

PROFIT CARRIED FORWARD

Basic / Diluted Earnings Per Share (Rs.)

NOTES

1,487,695500,000

10,777

1,998,472

334,46246,908

1,117,102

500,000

1,998,472

60.59

6

31st March,2004

Rs. '000

14,705,263309,136

14,396,127

545,923

14,942,050

6,040,775627,225224,040

6,086,726

12,978,766

1,963,284119,361

1,843,923655,930

1,187,993500,000

29,725

1,717,718

272,34534,894

910,479

, 500,000

1,717,718

44.16

In terms of our report of even date Chairman Nusli N. WadiaDirectors Avijit Deb

Usha A. Narayanan A. K. HirjeePartner S. S. KelkarMembership Number : 23997 Pratap Khanna

For and on behalf of Field Marshal Sam Manekshaw> M-c-Lovelock & Lewes Nimesh KampaniChartered Accountants John Miller

Francois-Xavier RogerMumbai Chief Executive Officer VinitaBali26th May, 2005

Chief Financial Officer N. Shridhar

,

flfflTMiJSEat Healthy,

® '

J3IJIE1 27^P^Think Better


2onoT2ooe5port CASH FLOW STATEMENT

For the year ended

CASH FLOW FROM OPERATING ACTIVITIES

Net profit before taxation

Adjusted forDepreciation and AmortisationVoluntary Retirement CompensationReversal of previous year's liabilitiesForeign Exchange / Forward cover (Gain) / LossLoss on retiral of assetsIrrecoverable advance written offClaims for corporate guaranteeProvision for diminution in value of investmentsRefund from Covenanted Staff Pension Fund(Profit)/Loss on sale of Investments - Net(Profit)/Loss on sale of Fixed Assets - NetInvestment IncomeInterest IncomeInterest expenses

Operating Profit before Working Capital changes

Adjusted for

InventoriesDebtorsLoans & AdvancesCreditors & Provisions

Cash Generated from Operations

Refund from Covenanted Staff Pension FundVoluntary Retirement Compensation paidInterest paidDirect Taxes Paid

31st March,2005

Rs. '000

2,202,407

189,707134,026(34,514)(17,754)

1,436-

115,000325,000

-(583,678)(323,007)

(61,774)(11,645)

21,035

1,956,239

(119,773)87,30018,283

855,310

2,797,359

—(90,112)

(7,691)(775,000)

NET CASH FLOW FROM OPERATING ACTIVITIES 1,924,556

CASH FLOW FROM INVESTING ACTIVITIES

Purchase of Fixed Assets and Capital AdvancesSales of Fixed AssetsPurchase of InvestmentsSale of InvestmentsInterest receivedDividend receivedLoans givenLoans repaid

(431,745)6,359

(9,061,539)8,932,609

11,64561,774

(14,466)43,561

NET CASH FROM/(USED) IN INVESTING ACTIVITIES (451,802)

28 (tfw^M4JKEat Healthy,

3 1 st March,2004

Rs. '000

1,843,923

224,04097,211

(63,892)143

2,850185,198

-78,398

(121,199)(387,837)

(58,870)(30,512)(25,119)

60,460

1,804,794

(403,217)100,475(31,554)101,064

1,571,562

121,199(73,363)(81,802)

(711,700)

825,896

(118,423)66,981

(8,435,856)8,800,644

32,60830,512(8,782)27,045

394,729

9

gflPThin/s Better


Annual Report2004-2005 CASH FLOW STATEMENT (Contd.)

For the year ended 31st March,2005

Rs. '000

31st March,2004

Rs. '000

CASH FLOW FROM FINANCING ACTIVITIESRepayment to BanksBorrowings from BanksBuy back of Equity Share capitalDebentures redeemedTax on dividendDividend paid

NET CASH FROM / (USED IN) FINANCING ACTIVITIES

NET (DECREASE) / INCREASE - CASH AND CASH EQUIVALENTS

CASH & CASH EQUIVALENTSOpening balance

Cash and Bank BalancesCash Equivalents

TOTAL

Closing BalanceCash & Bank BalancesCash Equivalents

TOTAL

(330,486)

(778,113)

(33,670)(262,792)

(1,405,061)

67,693

70,82727,796

98,623

163,0623,254

166,316

(3,602,644)2,950,000(424,819)(500,000)

(32,175)(249,993)

(1,859,631)

(639,006)

708,49529,134

737,629

70,82727,796

98,623

Notes:

1. The above cash flow statement has been prepared in accordance with the requirements of Accounting Standard3 "Cash Flow Statement" issued by the Institute of Chartered Accountants of India.

2. Figures in brackets indicate cash outgo, except for adjustments for operating activities.

3. Previous years' figures have been regrouped/rearranged wherever necessary.

In terms of our report of even date

Usha A. NarayananPartnerMembership Number : 23997

For and on behalf ofLovelock & LewesChartered Accountants

Mumbai26th May, 2005

ChairmanDirectors

Chief Executive Officer

Chief Financial Officer

Nusli N. WadiaAvijit DebA. K. HirjeeS. S. KelkarPratap KhannaField Marshal Sam Manekshaw, M.C.Nimesh KampaniJohn MillerFrancois-Xavier RogerVinita Bali

N. Shridhar

®


29


Annual Report2004-2005 SCHEDULES TO BALANCE SHEET

A SHARE CAPITAL Shares ofRs. 10 each

31st March,2005

Rs. '000

31st March,2004

Rs. '000

AuthorisedIssued andsubscribed

Equity Shares 50,000,000

Equity shares for cash fully paid 1,917,455For consideration other than cashpursuant to a contract fully paid 35,779As bonus shares by capitalisation ofreserves and share premium fully paid 25,897,216Less : Equity shares bought back (3,960,287)during the year 1,221,887(Previous Year 792,226)(Refer note vii (a) (i) of Schedule N)

23,890,163

500,000

19,175

358

258,972(39,603)

238,902

500,000

19,175

358

258,972(27,384)

251,121

B RESERVES AND SURPLUSRs. '000

General CapitalRedemption

Reserve

Profit Total Previousand loss Year

As at 31st March, 2004

Addition :Transfer from Profit and

Loss AccountTransfer from Debenture

Redemption ReserveTransfer from General Reserve

(Refer Note (vii) (a) (iii) of Schedule N)

Deduction :Premium relating to Equity

Shares bought back(Refer note (vii) (a) (ii) of Schedule N)

Non-compete fees adjustedagainst reserves

Intangible assets adjustedagainst reserves(Refer note (xi) of Schedule N))

Transfer to CapitalRedemption Reserve(Refer note (vii) (a) (iii) of Schedule N)

Transfer to Profit and Loss Account onRedemption of Debentures

Transfer to General Reserve

As at 31st March, 2005

3,531,749 27,384 500,000 4,059,133 3,652,606

1,117,102

4,648,851

765,894

214,000

12,219

12,219

500,000 1,617,102 1,410,479

29,725

12,219 7,922

39,603 1,000,000 5,688,454 5,100,732

765,894 416,897

- 57,330

214,000

12,219 7,922

- 29,725- - 500,000 500,000 529,725

3,656,738 39,603 500,000 4,196,341 4,059.133

C LOAN FUNDS 31 March, 31 March2005 2004

Rs. '000 Rs. '000

SecuredBank Overdraft (represents book overdraft)Secured by hypothecation by way of first chargeon book debts, receivables, stocks and stores.

61,379 391,865

61,379 391,865

30

®


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26

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317,

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1,96

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22,9

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9

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2,77

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the

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Mar

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_ _

-

-

-

-

82

,92

9 6

,98

5 5

75

89

,33

9

1,18

5,68

3 16

7,44

6 13

,228

1,

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901

98

,38

9 15

,186

4

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26

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§1 O 3



E INVESTMENTS

Long TermUnquotedTrade : The Bengal Chamber of Commerce and Industry.

6 1/2% Non-redeemable registered debentures 1962.Others :Shares Flora Investments Company Private Limited.(Fully paid) 84,987 equity shares of Rs. 10 each

(Previous year 84,987 equity shares of Rs. 10 each).

Boribunder Finance and Investments Private Limited.51,111 equity shares of Rs. 10 each(Previous year 51,1 1 1 equity shares of Rs. 10 each).

Gilt Edge Finance and Investments Private Limited.69,861 equity shares of Rs. 10 each(Previous year 69,861 equity shares of Rs. 10 each).

Uttam Biscuit Company Private Limited.33,600 equity shares of Rs. 10 each(Previous year 33,600 equity shares of Rs. 10 each).

J.B. Mangharam Foods Private Limited.108,036 equity shares of Rs. 10 each(Previous year 108,036 equity shares of Rs. 10 each).

Sunrise Biscuit Company Private Limited.1 19,880 equity shares of Rs. 10 each(Previous year 119,880 equity shares of Rs. 10 each).

Nalanda Biscuit Company Limited.60,000 equity shares of Rs. 10 each(Previous year 60,000 equity shares of Rs. 10 each).

Ganges Vally Foods Private Limited.144,000 equity shares of Rs. 10 each(Previous year 144,000 equity shares of Rs. 10 each).

Manna Foods Private Limited.90,000 equity shares of Rs. 10 each(Previous year 90,000 equity shares of Rs. 10 each).

International Bakery Products Limited.1 15,000 equity shares of Rs. 10 each(Previous year 115,000 Equity Shares of Rs. 10 each).

Klassik Foods Private Limited.3,130 equity shares of Rs. 100 each(Previous year 3,130 equity shares of Rs. 100 each).

Kwality Biscuits Private Limited.NIL equity shares of Rs. 10 each. Sold during the year30,340 equity shares of Rs. 10 each(Previous year 30,340 equity shares of Rs. 10 each).

Britannia New Zealand Foods Private Limited.2,832,200 equity shares of Rs. 10 each(Previous year 2,832,200 equity shares of Rs. 10 each).

3 1 st March, 3 1 st March,2005 2004

Rs. '000 Rs. '000

4 4

1,025 1,025

679 679

847 847

2,769 2,769

5,186 5,186

1,942 1,942

1,385 1,385

1,440 1,440

900 900

1,150 1,150

2,880 2,880

78,398

575,246 575,246

. ®

Hct^^^^^^^^^^^^^^^^HlRRITANNIAI^^^^^^^^^^^^^^^^^^^HEat Healthy, Think Better



E INVESTMENTS (Contd.) 31 st March, 31st March,2005 2004

Rs. '000 Rs. '000

Debentures

Others

Britannia New Zealand Foods Private Limited.2,940,000 10% Non-cumulative redeemablepreference shares of Rs. 10 each(Previous year 2,940,000 10% Non-cumulativeredeemable preference shares of Rs. 10 each).

Britannia New Zealand Holdings Private Limited, Mauritius1,000 equity shares of USD 1 each (Previous year NIL)

J.B. Mangharam Foods Private Limited.325,000, 10% Secured Redeemable Non-ConvertibleDebentures of Rs. 100 each fully paid.(Previous year 400,000, 12% SecuredRedeemable Non-ConvertibleDebentures of Rs. 100 each fully paid).Redeemed during the year 75,000 (Previousyear 50,000), 12% Secured RedeemableNon-Convertible Debentures of Rs. 100 eachfully paid.

International Bakery Products Limited.582, 0% Unsecured Convertible Debentures ofRs. 100,000 each fully paid. (Previous year NIL).Subscribed during the year 582,0% Unsecured ConvertibleDebentures of Rs. 100,000 each.

J.M. Income Fund - GrowthNIL (Previous year 11,907,782 units of Rs. 10 each).Sold during the year 11,907,782 units of Rs. 10 each

Templeton India Income Fund - GrowthNIL (Previous year 16,752,469 units of Rs. 10 each).Sold during the year 16,752,469 units of Rs. 10 each

DSP Merrill Lynch Bond Fund - GrowthNIL (Previous year 14,263,974 units of Rs.10 each)Sold during the year 14,263,974 units of Rs.10 each

Birla Income Plus - GrowthNIL (Previous year 4,483,056 units of Rs. 10 each).Sold during the year 4,483,056 units of Rs. 10 each

Templeton India Income Builder Account - GrowthNIL (Previous year 10,770,263 units of Rs. 10 each).Sold during the year 10,770,263 units of Rs. 10 each

Sundaram Bond Saver - GrowthNIL (Previous year 7,660,167 units of Rs. 10 each)Sold during the year 7,660,167 units of Rs. 10 each

HDFC Income Fund - GrowthNIL (Previous year 11,773,663 units of Rs. 10 each)Sold during the year 11,773,663 units of Rs. 10 each

29,400 29,400

44

32,500 40,000

58,200

230,000

270,000

227,262

80,000

170,000

110,000

150,000

®


33



E INVESTMENTS (Contd.) 31st March, 31st March,2005 2004

Rs. '000 Rs. '000

Capital in apartnership firm

QuotedOthersSnares(Fully paid)

Current

Grindlays Super Saver Income Fund - Growth - 250,000NIL (Previous Year 19,012,039 units of Rs. 10 each).Sold during the year 19,012,039 units of Rs. 10 each

Kotak - K Bond Wholesale Plan - Growth - 1 70,000NIL (Previous Year 1 1,449,886 units of Rs. 10 each).Sold during the year 11,449,886 units of Rs. 10 each

HDFC Multiple Yield Fund - Growth 350,00035,000,000 units of Rs. 10 each (Previous Year NIL)Purchased during the year 35,000,000 units of Rs. 10 each.

Franklin Templeton India Monthly Income Plan A - Growth 250,000 -14,764,157 units of Rs.10 each (Previous year NIL)Purchased during the year 14,764, 157 'units of Rs. 10 each

DSP Merrill Lynch Savings Plus Moderate - Growth 90,0007,219,753 units of Rs.10 each (Previous year NIL)Purchased during the year 7,219,753 units of Rs. 10 each

HDFC Monthly Income Plan - Short term - Growth 80,0007,325,337 units of Rs. 10 each (Previous year NIL)Purchased during the year 7,325,337 units of Rs. 10 each

Kotak Fixed Maturity Plan Series I - Growth 250,00025,000,000 units of Rs. 10 each (Previous Year NIL)Purchased during the year 25,000,000 units of Rs. 10 each.

Grindlays Fixed Maturity 4th Plan B - Growth 250,00025,000,000 units of Rs. 10 each (Previous Year NIL)Purchased during the year 25,000,000 units of Rs. 10 each.

Birla Fixed Term Plan Series A - Growth 300,00030,000,000 units of Rs. 10 each (Previous Year NIL)Purchased during the year 30,000,000 units of Rs. 10 each.

Britannia Sports - Partnership firm 49 49(Refer note fix) of Schedule N"l

2,285,646 2,400,562

HDFC Bank Limited 372 372 ,37,200 Equity shares of Rs. 10 each(Previous year 37,200 equity shares of Rs. 10 each).

Aggregate market value of quoted investments Rs. 20.246 mn.(Previous ye^r R <; 14 074 mn)

372 372

Prudential ICICI Liquid Plan Institutional Plus Daily Dividend 488,902 105,02541,252,358 units of Rs. 10 each(Previous year 8,861 ,940 units of Rs. 10 each)Purchased during the year 79,300,206 units of Rs. 10 eachReinvested during the year 1,185,391 units of Rs. 10 eachSold during the year 48,095, 178 units of Rs. 10 each

CR)

34 P^^W^ffilEat Healthy, Think Better


Annual Report2004-2005 ^^

E INVESTMENTS (Contd.) 31st March, 31st March,2005 2004

Rs. 'OOP Rs. 'OOP

Grindlays Cash Fund Institutional Plan B - Daily Dividend 154,912 70,13615,491,233 units of Rs. 10 each(Previous year 6,628,089 units of Rs. 10 each)Purchased during the year 134,957,084 units of Rs. 10 eachReinvested during the year 1,031,874 units of Rs. 10 eachSold during the year 127,115,814 units of Rs. 10 each

JM Short Term Plan Institutional Dividend Reinvestment - 144,275NIL (Previous year 14,264,190 units of Rs. 10 each)Sold during the year 14,264,190 units of Rs.10 each

Birla Bond Plus Institutional Short Term Plan Dividend Reinvestment - 240,747NIL (Previous year 23,133,636 units of Rs. -10 each)Sold during the year 23,133,636 units of Rs. 10 each

DSP Merrill Lynch Liquidity Plan Daily Dividend Reinvestment - 30,440NIL (Previous year 3,040,914 units of Rs. 10 each)Purchased during the year 62,446,169 units of Rs. 10 eachReinvested during the year 199,302 units of Rs. 10 eachSold during the year 65,686,385 units of Rs. 10 each

JM High Liquidity - Super Institutional Plan - Daily 40,042Dividend Reinvestment3,997,586 units of Rs. 10 each (Previous year NIL)Purchased during the year 55,579,580 units of Rs. 10 eachReinvested during the year 379,187 units of Rs. 10 eachSold during the year 51,961,181 units of Rs. 10 each

Birla Cash Plus Institutional Premium Plan Daily Dividend Reinvestment 8,655 -863,848 units of Rs. 10 each (Previous year NIL)Purchased during the year 93,752,032 units of Rs. 10 eachReinvested during the year 487,026 units of Rs. 10 eachSold during the year 93,375,210 units of Rs. 10 each

Sundaram Money Fund Institutional - Daily Dividend Reinvestment 91,233 -9,037,135 units of Rs. 10 each (Previous year NIL)Purchased during the year 35,918,472 units of Rs. 10 eachkeinvested during the year 195,041 units of Rs. 10 eachSold during the year 27,076,378 units of Rs. 10 each

Kotak Liquid Institutional Premium - Daily Dividend Reinvestment 143,35711,723,603 units of Rs. 10 each (Previous year NIL)Purchased during the year 79,771,708 units of Rs. 10 eachReinvested during the year 646,132 units of Rs. 10 eachSold during the year 68,694,237 units of Rs. 10 each

Principal Cash Management Fund Institutional Plus Plan - Daily 121,256Dividend Reinvestment12,124,865 units of Rs. 10 each (Previous year NIL)Purchased during the year 30,007,255 units of Rs. 10 eachReinvested during the year 116,530 units of Rs. 10 eachSold during the year 17,998,920 units of Rs. 10 each

HSBC Cash Fund - Institutional Plus Daily Dividend Reinvestment 170,98817,089,174 units of Rs. 10 each (Previous year NIL)Purchased during the year 16,993,219 units of Rs. 10 eachReinvested during the year 95,955 units of Rs. 10 each

BRITANNIA 35




E INVESTMENTS (Contd.)

Deutsche Insta Cash Plus Fund Institutional Plan - Daily DividendReinvestment6,009,996 units of Rs. 10 each (Previous year NIL)Purchased during the year 5,988,323 units of Rs. 10 eachReinvested during the year 21,673 units of Rs. 10 each

ING Vysya Liquid Fund Institutional - Daily Dividend Reinvestme5,013,531 units of Rs. 10 each (Previous year NIL)Purchased during the year 4,996,902 units of Rs. 10 eachReinvested during the year 16,629 units of Rs. 10 each

Chola Liquid Institutional - Daily Dividend Reinvestment Plan1,000,623 units of Rs. 10 each (Previous year NIL)Purchased during the year 998,562 units of Rs. 10 eachReinvested during the year 2,061 unit's of Rs. 10 each

Total Investments

Less : Provision for Diminution in value of investment[Refer note (xii) of Schedule 6]

F INVENTORIES

Stores, spare parts etc.Packing materialsRaw materialsFinished goodsMaterials in process

Loose tools

G SUNDRY DEBTORS

Secured Considered good:Over six monthsOthers

Unsecured Considered good:Over six monthsOthers @

Considered doubtful:Over six months

Less: Provision for doubtful debts

31st March,2005

Rs. '00060,217

nt 50,166

10,021

1,339,749

3,625,767

(325,000)

3,300,767

31st March,2005

Rs. '000

44,074153,111824,354316,869

1,6881,340,096

2,141

1,342,237

31st March,2005

Rs. '000

1,7673,2955,062

17,991404,711422,702

21,485444,187

21,485422,702427,764

3 1 st March,2004

Rs. '000

-

590,623

2,991,557

(78,398)

2,913,159

31st March,2004

Rs. '000

46,711172,328585,026413,729

1,9961,219,790

2,674

1,222,464

31st March,2004

Rs. '000

2,7091,1393,848

33,503153,785187,288

15,624202,912

15,624187,288191,136

@ - 1 . Includes Rs. 9.070 mn (Previous year Rs. 13.124 mn) due from an Associate Company having common directors.2. Also includes Rs. 323.928 mn (Previous year NIL) [Refer note (x) of Schedule 6].

r~ n36 pfl^^^to




H CASH AND BANK BALANCES

Cash and Cheques on handWith Scheduled Banks in current accounts

1 OTHER CURRENT ASSETS

Assets Held for sale

J LOANS AND ADVANCES

Unsecured Considered good :Bills receivableAdvances recoverable in cash or in kind or for valueto be received includes :

31st March,2005

Rs. '000

89,98573,077

163,062

31st March,2005

Rs. '000

1,847

1,847

31st March,2005

Rs. '000

15,383

635,472

31st March,2004

Rs. '000

8,82662,001

70,827

31st March,2004

Rs. '000

4,389

4,389

31st March,2004

Rs. '000

8,045

730,845

- Amount outstanding by an erstwhile Director and an Officer NIL(Previous year Rs. 0.007 mn). Maximum amount outstanding atany time during the year by an erstwhile Director and an Officer

Rs. 0.007 mn (previous year Rs. 6.955 mn).

- Amount outstanding by a Manager NIL (Previous year Rs. 0.233 mn),an erstwhile Officer Rs. 0.362 mn (Previous year Rs. 0.987 mn).Maximum amount outstanding at any time during the year by aManager Rs. 0.233 mn (Previous year Rs. 0.272 mn) and an erstwhileOfficer Rs. 0.987 mn (Previous year Rs. 1.158 mn).

- Capital Advances of Rs.61.869 mn (Previous year Rs. 36.051 mn)

- Advance for subscription to debentures NIL(Previous year Rs. 62.373 mn).

- Amount Rs. NIL (Previous year Rs. 10.195 mn) being expenditureincurred by or at the behest of the erstwhile Managing Director andhis relatives/related parties [Refer note (vi) of Schedule N]

Taxes paid less provisionCurrent accounts with Excise and Customs authorities

Considered doubtful:Advances

45,14612,719

108,351

Less: Provision for doubtful advances817,071108,351

708,720

32,0508,435

51,393

830,76851,393

779,375

®


37



K LIABILITIES 31 st March, 31 st March,2005 2004

Rs. '000 Rs. '000

Book overdraft

Sundry Creditors- Due to Small Scale Industrial Undertakings

[Refer note (xii) of Schedule N]- Others

Investor Education and Protection Fund shall be credited by- Unpaid dividend (less than 7 years)

185,491

6,693 11,205

1,856,420 1,350,761

11,113 11,014

2,059,717 1,372,980

L PROVISIONS 31st March,2005

Rs. '000

31st March,2004

Rs. '000

Provision for Excise related demands [Refer note (xiv) of Schedule N] 91,947Provision for Sales tax demands [Refer note (xiv) of Schedule N] 96,788Provision for trade and other demands [Refer note (xiv) of Schedule N] 192,267Provision for Retirement benefitsTerminal compensation benefit [Refer note (x) of Schedule N]DividendTax on Dividend

60,791150,268334,46246,908

973,431

30,71878,48177,26760,521227,002272,34534,894

781,228

M MISCELLANEOUS EXPENDITURE 31 st March, 31 st March,2005 2004

Rs. '000 Rs. '000

Voluntary Retirement Compensation andTerminal Compensation Benefits[Refer note (vi) of Schedule 6]

342,359 463,006

342,359 463,006

®

38 BRITANNIAEat Healthy, Think Better



N NOTES

(i) The Significant accounting policies are summarised below :

(a) Basis for preparationof accounts

(b) Fixed assets

(c) Inventories

(d) Sundry Debtors

(e) Investments

'

(f) Revenue Recognition

(g) Foreign Currencies

(h) Deferred Taxation

The accounts have been prepared to comply in all material aspects with applicableaccounting principles in India, the Accounting Standards issued by the Institute ofChartered Accountants of India and the relevant provisions of the Companies Act,1956.

1 . Fixed assets are stated at their original cost less depreciation. Cost includes inwardfreight, duties, taxes and expenses incidental to acquisition and installation net ofCENVAT credit where applicable.

2. Depreciation in respect of all assets acquired upto 30th June, 1984, is provided on'Written Down Value' method. For additions on or after 1st July, 1984, 'StraightLine' method has been used. The rates are as specified in the amended ScheduleXIV of the Companies Act, 1956. Assets costing less than Rs. 5,000 are fully depre-ciated in the year of addition.

3. Acquired Trade marks, Designs, Copyrights etc are amortised over a period of 10years and reviewed for their useful life in line with Accounting Standard on Intan-gible Assets (AS 26) issued by the Institute of Chartered Accountants of India.

4. Assets identified and retired based on technical evaluation and held for disposal arestated at estimated net realisable value.

5. Research and development expenses of revenue nature are charged off in the periodin which they are incurred.

1 . Raw materials, stores and spares and materials in process are valued at cost or under,after making provision for obsolescence, where appropriate. Cost includes pur-chase price, freight and other incidental expenses.

2. Finished goods are valued at lower of prime cost plus manufacturing overheads andnet realisable value.

3. Loose tools are written off over 10 years from the year of purchase.

Sundry Debtors are stated after making adequate provision for doubtful debts.

1 . Long term investments are stated at cost, net of provision for permanent diminutionin value. Current investments are stated at lower of cost and market value.

2. Dividend income is accounted for in the year in which the right to receive the sameis established. Interest on investments are booked on a time-proportion basis takinginto account the amounts invested and the rate of interest.

Sales are recorded when supply of goods takes place in accordance with the terms ofsale. Gross sales include excise duty but are net of trade discounts. Income from royalty/services is accounted based on contractual agreements/arrangements.

1. Exchange difference arising from foreign currency transactions and premia onforward contracts are dealt with in the Company's Profit & Loss Account.

2. Current assets and liabilities including loans are restated at the rates prevailing atthe year end, or at forward contract rates as applicable.

3. Profit/loss arising on cancellation or renewal of forward exchange contracts arerecognised as income/expense for the period, except in case of forward exchange ~contracts relating to liabilities incurred for acquiring fixed assets, in which casesuch profit/loss are adjusted in the carrying amount of the respective fixed assets.

Deferred tax is recognised on timing differences, being the difference between taxableincome and accounting income that originate in one period and are reversible in one ormore subsequent periods.

®

fflffl^ffifl 39




(j) MiscellaneousExpenditure

N NOTES (Contd.)

(i) Provision for 1. The liabilities in respect of retirement benefits are provided/regularly contributedRetirement Benefits to appropriate authorities/various Provident Funds, Pension Funds and Gratuity

Funds and are charged against revenue based on contributions as a fixed percent-age of salaries/actuarial valuations in accordance with applicable rules.

2. Leave encashment liability is determined by actuarial valuation.

Compensation under the Company's Voluntary Retirement Scheme (VRS) and TerminalCompensation Benefits is being amortised over a period of 5 years from the month ofpayment in line with the Announcement made by the Institute of Chartered Accountantsof India. The unamortised amount is carried forward as "Miscellaneous Expenditure" inthe Balance Sheet.

(ii) Commitments for capital expenditure not provided for Rs. 150.438 mn (Previous year Rs. 225.517 mn).

(iii) (a) Contingent Liabilities for :

1. Bank guarantee/Letter of comfort Rs. 105.962 mn (Previous year Rs. 152.092 mn).

2. Discounted cheques Rs. 278.187 mn (Previous year Rs. 256.444 mn).

3. Claims/demand against the Company not acknowledged as debts including excise, income tax and salestax Rs.183.752 mn (Previous year Rs.103.586 mn).

Note : The above does not include non quantifiable industrial disputes and other legal disputes pendingbefore various judicial authorities.

(b) The Company has furnished a Letter of Awareness to Hongkong & Shanghai Banking Corporation who havegranted banking facilities of Rs. 600 mn (Previous Year Rs. 600 mn) to M/s. Britannia New Zealand FoodsPrivate Limited based on the letter. The letter is not to be construed as a Guarantee issued by the Company.

(iv) Assets on Operating lease aggregate to Rs. 6.106 mn (Previous year Rs. 11.810 mn). The charge on account of leaserental to Profit and Loss Account for the year is Rs. 2.184 mn (Previous year Rs. 5.972 mn).

(v) Future obligations of lease rentals applicable to above leased assets aggregate to Rs. 6.191 mn (Previous yearRs. 2.747 mn) and are due :

Rs. '000

31st March,2005

1,4494,742

6,191

31st March,2004

2,122625

2,747

In respect of buildings occupied as tenant, the aggregate lease rentals are charged as rent in the Profit and LossAccount.

(vi) The matter relating to certain expenditure of the erstwhile Managing Director, Mr. S. K. Alagh and his relatives/related parties was reviewed and the amounts payable/receivable by the Company were ascertained and settledduring the year.

(vii) (a) The Company has bought back 1,221,887 equity shares (Previous year 792,226 equity shares) of Rs. 10 eachat an' average price of Rs. 636.81 per share (Previous year Rs. 536.23 per share) during the year and accordingly:

(i) The face value of shares have been reduced from the paid up Equity Share Capital.

(ii) The balance of Rs. 626.81 per share (Previous year Rs. 526.23 per share) paid on these shares aggregatingto Rs. 765.894 mn (Previous year Rs. 416.897 mn) has been adjusted to General Reserve.

(iii) As required under the provisions of Companies Act, 1956, Rs. 12.219 mn (Previous year Rs. 7.922 mn)has been transferred to Capital Redemption Reserve from General Reserve.



Annual Report2004-2005 _

N NOTES (Contd.)

(b) The Company had bought back and extinguished 868,434 equity shares (Previous year NIL) between 26thJune 2004, and 6th August 2004, the record date for purposes of identifying the members eligible for dividend.Accordingly, the provision for dividend and tax thereon, on these shares, Rs. 10.777 mn (Previous Year NIL)has been transferred to the Profit and Loss Appropriation Account during the year.

(viii) Accounting for taxes on income disclosure as per Accounting Standard 22. Major components of deferred taxassets and liabilities on account of timing differences as at 31st March 2005 are :

Rs. '000

Asset

31st March,2005

-

n 6,767

117,715

12,602

137,084

31st March,2004

-

-

125,893

5,524

131,417

Liability

3 1 st March, 3 1 st March,2005 2004

170,600

-

-

-

170,600

194,688

7,784

-

-

202,472

(a) Depreciation

(b) Voluntary retirement scheme/compensation

(c) Statutory payments etc.

(d) Provisions allowed on payment/write off

TOTAL

(ix) The Company has an investment in a partnership firm "Britannia Sports" in which it holds 49% share of the profitand loss and the balance is held by two associate companies namely, M/s. Flora Investments Company PrivateLimited and M/s Gilt Edge Finance and Investments Private Limited who hold 26% and 25% respectively. TheCompany has booked its proportionate share of partnership losses which is disclosed in the Profit and LossAccount.

(x) The production at the Company owned facility in Mumbai city was closed effective 24th March, 2004 based onthe order received from Labour Commissioner, Mumbai permitting the closure under Section 25(O) of the IndustrialDisputes Act, 1947. Certain section of the employees representing the Union have approached the IndustrialTribunal against the closure and the matter is pending disposal.

Out of the Rs. 227.002 mn provided for voluntary retirement and terminal compensation benefits in the previousyear, the Company has disbursed Rs. 76.734 mn during the year. This includes payments of Rs. 40.805 mn madein line with the order of the Mumbai High Court, as per eligible limits under Section 25 (O) of the IndustrialDisputes Act, 1947.

(xi) In accordance with the transitory provisions of the Accounting Standard on Impairment of Assets (AS-28) issuedby the Institute of Chartered Accountants of India, unamortised balance of Copyrights Rs. 117.960 mn, TrademarksRs. 89.040 mn and Designs Rs. 7 mn as at 1st April, 2004 have been adjusted against the opening General Reserve.This was based on the assessment of the business prospects related to these acquired assets. But for this change,depreciation for the year would have been higher and profit for the year would have been lower by Rs. 30.765 mn,and the balance of intangible assets and general reserves would have been higher by Rs. 183.235 mn.

(xii) The outstanding amount payable to any Small Scale Industrial Undertaking for more than 30 days as at 31-stMarch, 2005 is Rs. 0.010 mn (Previous Year NIL), in respect of M/s. True Cartons, Chennai.

®


41



N NOTES (Contd.)

(xiii) Details of investments purchased, reinvested and sold during the year :

Government and Trust Securities

QuotedNIL

UnquotedMutual Funds Number of units

Purchased Reinvested Sold

Face value

per unit (Rs.)

Grindlays Floater Super InstitutionalPlan C Daily Dividend Reinvestment 10,000,000

HDFC Cash Management Fund SavingsPlan Daily Dividend Reinvestment 21,003,872

HSBC Cash Fund - Institutional PlanDaily Dividend Reinvestment 2,873,536

Principal Cash Management InstitutionalPlan Daily Dividend Reinvestment 20,996,011

Templeton Floating Rate IncomeFund - Short Term Weekly DividendReinvestment ' 12,985,069

Templeton India Treasury ManagementAccount Institutional Plan Plus DailyDividend Reinvestment 1,072,367

129,998 10,129,998

47,901 21,051,773

2,620 2,876,156

9,054 21,005,065

76,080 13,061,149

7,863 1,080,230

10

10

10

10

10

1,000

(xiv) In accordance with Accounting Standard 29 on Provisions, Contingent Liabilities and Contingent Assets, issuedby the Institute of Chartered Accountants of India, certain classes of liabilities have been identified as provisionand accordingly regrouped separately as under:

Particulars Rs. '000 As at 31st Additions UtilisationMarch 04

Reversals As at 31stMarch 05

Excise related issues

Sales Tax and other taxes

Trade and other demands

30,718 84,186

78,481 29,123

77,267 115,000

22,957 91,947

10,816 96,788

192,267

The Company sets up and maintains provision for trade and other demands when a reasonable estimate can bemade. These provisions are based upon estimates made by the management, which are reviewed annually. Thesedemands/issues involve quick settlement not exceeding a, period of two - three years in most cases.

42

®




N NOTES (Contd.)

(xv) BALANCE SHEET ABSTRACT AND COMPANY'S GENERAL BUSINESS PROFILE

(a) Registration Details

Registration No. 02964 State Code

(b)

(c)

Balance Sheet Date

Capital raised during the year (Rs. '000)

Public Issue

Bonus Issue

Total Liabilities

Sources of Funds

Paid-up Capital

Rights Issue

Private Placement

Investments

Net Current Assets*

Misc. Expenditure

Deferred Tax Asset

(d)

(e)

Position of Mobilisation and Deployment of Funds (Rs. '000)

Total Assets*

Application of Funds

Net Fixed Assets

Reserves & Surplus

Secured Loans

Unsecured Loans

Deferred Tax Liability

* Net of Current Liabilities and Provisions.

Performance of the Company (Rs. '000)

Turnover

Total Expenditure including Exceptional Items

Profit Before Tax

Profit After Tax

Earnings per share in Rs.

Dividend rate %

Generic Names of Three Principal Products / Services of Company (as per monetary terms)

Item Code, No. (ITC Code)

Item Code No. (ITC Code)

Item Code No. (ITC Code)

Product Description

Product Description

Product Description

BISCUIT

BREAD

CAKE

(xvi) Figures in Rupees have been rounded off to the nearest thousand.(xvii) Previous year's figures have been regrouped/rearranged wherever necessary.

ChairmanDirectors

Chief Executive Officer

Chief Financial Officer

NusliN. WadiaAvijit DebA. K. HirjeeS. S. KelkarPratap KhannaField Marshal Sam Manekshaw, M.C.Nimesh KampaniJohn MillerFrancois-Xavier RogerVinita Bali

N. Shridhar

®


43


20on4a2ooe5port SCHEDULES TO PROFIT AND LOSS ACCOUNT

1 OTHER INCOME 2004-05Rs. '000

Profit/(Loss) on sale of debentures/equity shares/units 579,080of Mutual Funds, etc. - net

Income from other investments-gross

Bank and other Interest-gross

61,774

11,645

2003-04Rs. '000

387,837

30,512

25,119(Tax deducted Rs. 1.762 mn; Previous year Rs. 3.752 mn)

Foreign exchange gain/(loss) (net)

Profit on sale of fixed assets (net)

Other receipts

2 CONSUMPTION OF MATERIALS

Opening stock Raw materials

17,754

219

121,458

791,930

2004-05Rs. '000

585,026Materials in process 1 ,996Finished goods

Purchase Raw materialsFinished goods

Closing stock Raw materials

413,729

1,000,751

6,131,9911,368,862

7,500,853

824,354Materials in process. 1,688Finished goods

r *

44 I»V^^^MBSEat Healthy,

316,869

1,142,911

7,358,693

-

-

102,455

545,923

2003-04Rs. '000

. 343,0094,513

278,701

626,223

5,407,5891,007,714

6,415,303

585,0261,996

413,729

1,000,751

6,040,775

®HUSP**Think Better



3 EXPENSES

Packing Materials consumedStores and Spare parts consumedContribution to provident and other fundsWorkmen and staff welfare expensesPower and fuel

2004-05Rs. '000

1,601,70934,187

(a) 62,408(b) 67,854

140,741Repairs and maintenance of plant and machinery (c) 46,838Repairs and maintenance of buildingsRentRates and taxes (Net)InsuranceCarriage, freight and distributionLoss on sale of fixed assets (net)Auditors' remuneration

- Audit fees- Management services- Certificates- Expenses reimbursed

Advertising & Sales promotionConversion cost (Net)Miscellaneous (Net)Bad debts written offProvision for doubtful debts/advances (Net)Interest (Net)Loss on sale of investmentsServices shared with a Joint Venture forutilising common facilities

(a) Includes provisions for Retirement benefits(b) Includes salaries, wages and bonus(c) Includes stores consumed

(c) 15,28111,448

(d) 225,98514,459

565,450-

2,000875

—349

1,010,9311,856,362

(e)(f)&(g) 383,747—

63,180(h) 21,035(0

(12,274)-

6,112,565

370237

21,123

2003-04Rs. '000

1,583,33846,86079,873

113,457170,38552,43112,07917,406

194,61016,123

527,327.335

1,500931

97444

1,146,6141,721,078

326,7101,220

41,33360,460

-(27,885)

6,086,726

34,0132,139

21,685(d) Includes claim from contract packers in respect of certain taxes 40,501 -(e) Includes net (gain) / charge for exchange differences -(f) Share of loss in the partnership firm Britannia Sports 427

[Refer note (ix) of Schedule N](g) Includes donations to political parties

- Bhartiya Janata Party 8,000

(142)2,311

- •- Maharashtra Pradesh Congress Committee 4,500 -

(h) Includes 'interest on Debentures - 15,041(i) Net of reversal of provision for diminution in value of 73,800 -

4

investment (Refer note (xii) of Schedule 6)

EXCEPTIONAL ITEMS 2004-05Rs. '000

Proportionate Voluntary Retirement Scheme costs [Refer note (vi) of Schedule 6] (134,026)

2003-04Rs. '000

(97,211).Profit/(loss) on sale of brand [Refer note (x) of Schedule 6) 323,928Provisions/liabilities no longer required written back (net) 34,514[Refer note (vii) of Schedule 6]Refund of excess contribution to pension funds made in earlier years -Profit/(loss) on sale of propertiesLoss on retiral of assetsIrrecoverable advance written off

(1,140)(1,436)

-

63,892

121,199 '59,205(2,850)

(185,198)Claims on corporate guarantee [Refer note (xi) of Schedule 6] (1 15,000) -Diminution in value of investments [Refer note (xii) of Schedule 6] (325,000)

r- '

fltSEEat Healthy,

(218,160)

(78,398)

(119,361)

®

BSES 45s*̂Think Better



5 PROVISION FOR TAX 2004-05 2003-04Rs. '000 Rs. '000

Current income tax [Refer note (viii) of Schedule 6] 731,902 698,040Deferred income tax [Refer note (viii) of Schedule 6] (17,190) (42,110)

714,712 655,930

6 NOTES

(i) Gross SalesProduct group

Biscuits and high protein foodBreadCake and ruskOthers

The above does not include sale of wheat/by-produc

(ii) Raw materials consumed

FlourFats and OilsSugarOthers

ImportedIndigenous

(iii) Stores and spare parts consumed

ImportedIndigenous

Quantity Value

2004-05 2003-04 2004-05 2003-04Tonnes Tonnes Rs. '000 Rs. '000

311,853 280,044 14,926,882 13,618,82847,784 45,962 772,764 726,563

4,163 3,245 355,653 285,77899,186 74,094

16,154,485 14,705,263ts on conversion of inputs

Quantity Value

2004-05 2003-04 2004-05 2003-04Tonnes Tonnes Rs. '000 Rs. '000

222,651 217,869 2,134,533 2,075,22940,906 41,358 1,738,282 1,693,86370,339 68,410 1,035,546 855,532

984,302 540,948

5,892,663 5,165,572

2004-05 2003-04Rs. '000 % Rs. '000 %

296,577 5.03 87,628 1.705,596,086 94.97 5,077,944 98.30

5,892,663 100.00 5,165,572 100.00

2004-05 2003-04Rs. '000 % Rs. '000 ' %

39,502 71.42 6,393 9.3315,808 28.58 62,152 90.67

55,310 100.00 68,545 100.00

2004-05 2003-04Rs. '000 Rs. '000

(iv) Other Income includes :Net Income from long term investments - Gross 582,632 426, 140(Tax deducted Rs. 0.786 mn; Previous year Rs. 0.921 mn)Net of loss on diminution in value of long term mutualfunds Rs. 0.250 mn (Previous year NIL)

Net Income/(Loss) from current investments - Gross 63,625 (743)(Tax deducted Rs. 0.037 mn; Previous year Rs. 0.522 mn)Net of loss on diminution in value of Short Term mutual fundsRs. 0.172 mn (Previous year Rs. 3.290 mn)

,

46 rfJWMBK;Eat Healthy,

®

Think Better



6 NOTES (Contd.)

(v) Excise duty represents duty in relation to products manufactured in the Company's own facilities. Excise duty paid byContract Packers/Suppliers of finished goods forms part of Conversion charges/ Purchase of finished goods respectively.

(vi) Voluntary Retirement Scheme (VRS) and Terminal Compensation Benefits

The Company has paid VRS compensation/Terminal Compensation Benefits to employees amounting toRs. 13.378 mn (Previous year Rs. 73.363 mn) during the year and included the same under MiscellaneousExpenditure, over and above Rs. 76.734 mn [refer note (x) of Schedule N] on account of Mumbai factory closure.

The charge to the Profit and Loss account of Rs. 134.026 mn (Previous year Rs. 97.211 mn) includes amortisationrelating to payments/provisions made in earlier years and proportionate amount for the current year.

The unamortised amount carried forward as deferred revenue expenditure is Rs. 342.359 mn (Previous yearRs. 463.006 mn).

(vii) The Company has written back a net amount o^Rs. 34.514 mn (Previous year Rs. 63.892 mn) in respect ofliabilities to certain packers and others which have been withdrawn and/or settled during the year.

(viii) Provisions for income tax and deferred tax for the current year are after write back in respect of earlier years of Rs.114.819 mn (Previous year NIL) and Rs. 20.349 mn (Previous year NIL).

(ix) Salaries, Wages, Bonus and Commission and Contribution to Provident and other Funds are net of recoveries ofRs. 25.701 mn and Rs. 2.702 mn respectively for seconded staff costs (Previous year Rs. 39.736 mn andRs. 3.745 mn respectively).

(x) During the year, the Company has sold certain dairy trademarks relating to the self-generated brand "Milkman"for a consideration of Rs. 323.928 mn to M/s. Britannia New Zealand Holdings Private Limited, sale proceeds forwhich were received on 4th April, 2005.

(xi) Exceptional items include Rs. 115 mn (Previous year NIL) provided in respect of claims against the Company onaccount of Corporate Guarantee given by the Company on behalf of a business affiliate.

(xii) In accordance with Accounting Standard 13 - "Accounting for Investments", issued by the Institute of CharteredAccountants of India, a provision of Rs. 325 mn (Previous year Rs. 78.398 mn) has been made for diminution,other than temporary, on long term investment made in equity shares of a joint venture company.

Further, out of the provision of Rs. 78.398 mn for diminution in value of investments made in the previous year,an amount of Rs. 4.598 mn has been written back after adjusting the loss of Rs. 73.800 mn on sale of suchinvestments during the year.

(xiii) Directors/Managers remuneration of Rs. 23.396 mn (Previous year Rs. 16.143 mn) includes:

- Fees and estimated cost of benefits Rs. 5.935 mn (Previous year Rs. 2.929 mn)

- Contribution to Provident Fund, Pension Fund, Gratuity Fund Rs. 1.077 mn (Previous year Rs. 1.407 mn).

- Commission to Non-wholetime Directors Rs. 13 mn (Previous year Rs. 7 mn), net of reversal of last year'sliability Rs. 4 mn (Previous year Rs. 6 mn)

- Rs. 2.867 mn (Previous year Rs. 3.716 mn) for Managers appointment/remuneration requiring approval ofshareholders

BRITANNIA 47

Eat Healthy^Think Setter



6 NOTES (Contd.)

Statement of computation of net profits as per Section 349 of the Companies Act, 1956

Profit before Taxation

Add : Directors' remuneration including Directors' feesProvision for doubtful debts and advancesCommission to Non wholetime DirectorsProvision for diminution in value of investmentsProvision for claims on corporate guarantee / contract packersPolitical contributionsVRS and Terminal Compensation Benefits

Less : Profit on sale of investments (net)Provisions no longer required written backReversal of provision for diminution in value of investment [Refer note (xii) of Schedule 6]Profit on sale of brand [Refer note (x) of Schedule 6]

Non wholetime Directors commission restricted to 1%

Rs. 'OOP

2,202,407

10,39663,18013,000

325,000155,50112,500134,026

2,916,010

579,08034,5144,598

323,928

1,973,890

19,739

Notes :

1. Contribution to employee retirement / post retirement and other employee benefits which are based onactuarial valuation done on an overall Company basis are excluded from above.

2. Ms. Vinita Bali was appointed as a Manager w.e.f 24th January 2005.

(xiv) Licensed and installed capacities per annum - in tonnes

Product group Licensed Licensed Installed InstalledCapacity Capacity Capacity Capacity2004-05 2003-04 2004-05 2003-04

Biscuits and high protein foodBreadCake and rusk

111,00012,0005,500

111,000. 12,000

5,500

The Government vide Notification No : S.O.298(E) dated 3rd April 1997 has omitted biscuits from the list of itemsreserved for the small scale sector.

Installed Capacities are as certified by the Management including Mumbai factory [Refer note (x) of Schedule N]

(xv) Production in tonnes

Biscuits and high protein food

2004-05 2003-04

60,258 64,411

(xvi) Opening and Closing stocksof Finished goods

2004-05 2003-04Quantity

TonnesValue

Rs. '000Quantity

TonnesValue

Rs. '000

(a) Opening stockBiscuits and high protein foodBreadCake, rusk and others

10,578102

65

400,9466,6216,162

413,729

7,04896

108

274,1111,2103,380

278,701

48

®




6 NOTES (Contd.)

2004-05

(b) Closing stock Quantity ValueTonnes Rs. '000

Biscuits and high protein food 8,142 313,463BreadCake, rusk and others 107 3,406

316,869

2003-04

Quantity ValueTonnes Rs. '000

10,578 400,946102 6,62165 6,162

413,729

(xvii) Consumption of materials includes purchase of finished goods 43,753 tonnes (previous year 33,395 tonnes).

2004-05 2003-04Rs. '000 Rs. '000

(xviii) Expenditure in foreign currencies :Travelling, Software licenses and others

(xix) Value of imports on C.I.F. basis :(a) Capital goods(b) Raw materials(c) Components and spare parts

(xx) Earnings in foreign exchange from:(a) Exports at F.O.B.(b) Others - freight and insurance

- Miscellaneous(c) Sale of Trademark

(xxi) Dividend remitted to non-resident shareholders during the financial year :

Relating to the year ended 31st March 2003No. of shareholdersNo. of sharesAmount remitted (Rs.'OOO)

Relating to the year ended 31st March 2004No. of shareholdersNo. of shares 1 2Amount remitted (Rs.'OOO)

(xxii) Earnings Per ShareProfit attributable to the Equity Shareholders 1Add / Less: Extraordinary Items (Net of tax)

5,423 6,403

62,108 1,984258,349 72,394

2,749 11,590

71,645 48,0451,997 1,3462,202 5,100

323,928

6- 12,173,219

121,732

6,173,219133,905

,487,695 1,187,993(21,514) (119,249)

1,466,181 1,068,744

Weighted average number of Equity shares outstanding during the year 24,199,109 25,189,304Nominal value of Equity shares (Rs.) 10 10Earnings per Share 61.48 47.16Earnings per share adjusted for buyback of 2004-05 61.48 49.09Earnings per Share after adjustment of extraordinary items 60.59 42.43Earnings per share after adjustment of extraordinary items / buyback of 2004-05 60.59 44. 1 6Note : Extraordinary items include Reversal of previous years' liabilities

(xxiii) Based on guiding principles given in the Accounting Standard on Segment Reporting (AS -17), the primarybusiness segment of the Company is bakery, which consists of biscuits, bread and cakes. As the Companyoperates in a single primary business segment, disclosure requirements are not applicable. The Company primarilycaters to the domestic market and export sales are not significant and accordingly there is no reportable secondarysegment.

r nn^E^^^& 49Eat Healthy, Think Better



6 NOTES (Contd.)

(xxiv) Related party disclosures under Accounting Standard 18

Relationships

1. Party where control exists Associated Biscuits International Limited

2 . Other related parties with whom transactions have taken place during the year

- Joint Venture Company

- Associates

3.

4.

Key Management Personnel

Relatives of Key Management Personnel

Britannia New Zealand Foods Private Limited

Britannia New Zealand Holdings Private Limited, Mauritius

Kwality Biscuits Private Limited

J B Mangharam Foods Private Limited

Uttam Biscuit Company Private Limited

Sunrise Biscuit Company Private Limited

Ganges Vally Foods Private Limited

Manna Foods Private Limited

International Bakery Products Limited

Nalanda Biscuit Company Limited

Klassik Foods Private Limited

Flora Investments Company Private Limited

Boribunder Finance & Investments Private Limited

Gilt Edge Finance & Investments Private Limited

Britannia Sports (partnership firm)

Ms. Vinita Bali, Chief Executive Officer

Mr. Nikhil Sen, Chief Operating Officer

NIL

®




6 NOTES (Contd.)Rs. '000

Nature of transactions with Related Parties

Sale of InvestmentKwality Biscuits Private Limited

Britannia Sports

Investments madeInternational Bakery Products Limited

Others

Total

Debentures redeemedJB Mangharam Foods Private Limited

Provision for diminution in value of investmentsBritannia New Zealand Foods Private Limited


Remittance of dividendAssociated Biscuits International Limited

Purchase of Finished GoodsSunrise Biscuit Company Private Limited


Others

Total

Royalty and shared services income etc.Britannia New Zealand Foods Private Limited

Others

Total

Processing Charges paidUttam Biscuit Company Private Limited

JB Mangharam Foods Private Limited




Others

Total

Party wherecontrol exists

133,784121,732

Associates/Joint

Venture

4,598

49

58,200

44

58,244

7,5005,000

325,000

78,398

310,387259,630232,056196,039

2,5199,725

544,962465,394

36,83475,6 J 4

1,723

36,83477,337

90,66990,886

158,725773,55361,06653,803

100,88166,854

111,68287,79354,84134,923

577,864507,812

KeyManagement

personnel

Relatives ofKey

Managementpersonnel

,

Total

4,598

49

58,200

44

58,244

7,5005,000_,

325,000

78,398

133,784121,732

310,387259,630232,056196,039

2,5199,725

544,962. 465,394

36,83475,674

, 7,723

36,83477,337

90,66990,886

158,725773,553'61,06653,803

100,88166,854

111,68287,79354,84134,923

577,864507.872

®

ll RR ITAN Ml Al^^^^^^^^^^^^^^^^HSHI^r«^^Eat Healthy, Think Better



6 NOTES (Contd.)

Rs. '000


Interest & Dividend Income



Boribunder Finance & Investments Private Limited


Others

Total

Guarantees and collaterals given



Others

Total

Guarantees and collaterals taken back

Uttam Biscuit Company Private Limited



Others

Total

Letter of Awareness given



•

Associates/Joint

Venture

3,750

4,500

2,936

2,925

1,4732,247

-1 0,876

214336

8,373

20,876

86041

-20,250

-91

86020,3S2

2,655

2,205

_

192,455

219667

5,079

193,122

-

600,000

KeyManagement

personnel

Relatives ofKey

Managementpersonnel

Total

3,750

4,500

2,936

2,923

1,4732,241

-

10,876

214336

8,373

20,876

86041

-

20,250

-

91

86020,352

2,655

2,205

_

192,455

219667

5,079

193,122

-

600,000

52

^

ca

If RR ITAN N 1 AI^^^^^^^^^^^^^^^^^^^H^•CrfP^Cat Healthy. Think Better



6 NOTES (Contd.)

Rs. '000


Management contracts includingsecondment of employees (net)JB Mangharam Foods Private Limited



Others

Total

Reversals of previous years' liabilitiesSunrise Biscuit Company Private Limited



Others

Total

Inter Corporate Deposits madeBritannia New Zealand Foods Private Limited

Others

Total

Inter Corporate Deposits RepaidBritannia New Zealand Foods Private Limited

Others

Total

Advances made/convertedInternational Bakery Products Limited

Manna Foods' Private Limited

Kwality Biscuits Company Private Limited

Others

Total


Associates/Joint

Venture

3,5834,9482,4564,337

12,45725,9633,517

11,465

22,01346,713

32,973

17,82811,477

13,2029,7962,692

60,59727,377

130,000

11,892

141,892

130,000

3,770

133,770

16,150

5,501

28,0152,856

534

19,00634,050

KeyManagement

personnel

Relatives ofKey

Managementpersonnel

Total

3,5834,9482,4564,337

12,45725,9633,517

11,465

22,01346,713

32,973

17,82811,477

13,2029,7962,692

60,59727,377

130,000

11,892

141,892

130,000

3,770

•133,770

16,150

5,507

28,0752,856

534

19,00634,050

®

I BR ITAN N 1 A l^^^^^^^^^^^^^^^^HSH^^^^Eat Healthy, Think Better

^~~



6 NOTES (Contd.)

Rs. '000


Advances Repaid / AdjustedJB Mangharam Foods Private Limited




Total

Provision for doubtful advancesSunrise Biscuit Company Private Limited


Boribunder Finance and Investments Private Limited


Others

Total

Advances written offJB Mangharam Foods Private Limited


Total

Provisions for claims / expensesKwality Biscuits Private Limited


Total

Purchase of carJB Mangharam Foods Private Limited


Associates/Joint

Venture

8,458

7,692

1,944

1,820

16,1503,764

20,000

10,403

24,542

20,0001,174

56,11920,000

68,602

116,596

185,198

40,501

104817

40,605877

82

KeyManagement

personnel

Relatives ofKey

Managementpersonnel

Total

8,458

7,692

1,944

1,820

16,1503,764

20,000

10,403

24,542

20,0001,174

56,11920,000

68,602

116,596

185,198

40,501

104817

40,605817

82

r— ' ®

54 itfiB^ffltl

^^^^Bat Healthy, Think BetterL— —"^



6 NOTES (Contd.)

Rs. '000


RemunerationVinitaBali

Nikhil Sen

S.K.Alagh

Total

Loan repaid (inclusive of interest)Nikhil Sen

Share of loss in partnership firmBritannia Sports

Sale of GoodsBritannia New Zealand Foods Private Limited

Others

Total

Sale of assets -trademark licenseBritannia New Zealand Holdings Private Limited

Purchase of assetsKwality Biscuits Private Limited

Sale of AssetsSunil Alagh

Rent ReceivedMaya Alagh

Outstanding as at Year endNet ReceivabIes/(PayabIes)Britannia New Zealand Holdings Private Limited





Boribunder Finance and Investments Private Limited


Others

Total


• >

Associates/Joint

Venture

4272,311

6,3126,666

3,2646,3129,930

323,928

1,740

323,974

7,96014,16762,89925,583

(995)9,070

(19,405)26,657

1,47324,5427,465

13,124(15,532)(44,658;367,83968,485

KeyManagement

personnel

2,493

7,0613,776

8,6549,554

72,370

23346

27

Relatives ofKey

Managementpersonnel

-

47

(3,571)

(3,571)

Total

2,493

7,0613,776

8,6549,554

72,370

23346

4272,377

6,3126,666

3,2646,3129,930

323,928

1,740

21

47

323,974

7,96074,76762,899

' 25,583(995)9,070

(19,405)26,657

1,47324,5427,465 *

73,724(15,532)(48,229)367,839

64,974

— ®E^^^Bn 55Eat Healthy, Think Better

u— -^



6 NOTES (Contd.)


Amount recoverable on account of expenditureincurred by or at the behest of erstwhileManaging Director and his relatives /related partiesSunil Alagh

Advance against Debentures/Preference SharesInternational Bakery Products Limited

Investment in DebenturesJB Mangharam Foods Private Limited


Total

Guarantees/Collaterals/Contingent liabilityKwality Biscuits Private Limited

Others

Total

InvestmentsBritannia New Zealand Foods Private Limited


Others

Total

Provision for InvestmentBritannia New Zealand Foods Private Limited


Total

Letter of AwarenessBritannia New Zealand Foods Private Limited


Rs. '000

Associates/Joint

Venture

62,373

32,50040,00058,200

90,70040,000

20,25020,250

1,2585,224

21,50825,474

604,646604,646

78,39820,25220,257

624,898703,295

325,000

78,398

325,00078,398

600,000600,000

KeyManagement

personnel

9,817

Relatives ofKey

Managementpersonnel

378

Total

10,195

62,373

32,50040,00058,200

90,70040,000

20,25020,250

1,2585,224

21,50825,474

604,646604,646

78,39820,25220,257

624,898703,295

325,000

78,398

325,00078,398

600,000600,000

Notes:I . The above does not include related party transactions with retiral funds, as the key management personnel who are also trustees

of the Funds cannot individually exercise significant influence on the retiral funds transactions.

2. Previous year figures are in italics

®

56 llBRITANNIAI•̂ C^P^

Eat Healthy, Ttiink Better



6 NOTES (Contd.)

(xxv) Disclosure as per Clause 32 of the listing agreement in respect of loans and advances in the nature of loans toassociates outstanding at year end :

Klassik Foods Private Ltd. NIL (maximum outstanding Rs. 4.013 mn [Previous year Rs. 4.013 mn - maximumoutstanding Rs. 4.013 mn] Sunrise Biscuit Company Private Ltd. Rs. 57.230 mn (maximum outstanding Rs.58.547 mn) [Previous year Rs. 58.547 mn- maximum outstanding Rs. 58.547 mn] Gilt Edge Finance & InvestmentsPrivate Ltd. Rs. 1.922 mn (maximum outstanding Rs. 1.922 mn) [Previous year Rs. 1.922 mn - maximumoutstanding Rs. 2.245 mn] Boribunder Finance & Investments Private Ltd. Rs. 26.014 mn (maximum outstandingRs. 26.014 mn) [Previous year Rs. 24.542 mn - maximum outstanding Rs. 25.485 mn], Flora Investments

r Company Private Ltd. Rs. 1.092 mn (maximum outstanding Rs. 1.092 mn) [Previous year Rs. 1.092 mn- maximumoutstanding Rs. 1.404 mn] and Britannia New Zealand Foods Private Ltd. NIL (maximum outstanding NIL)[Previous year NIL- maximum outstanding Rs. 130.000 mn]

(xxvi) Figures in Rupees have been rounded off to the nearest thousand.

(xxvii) Previous year's figures have been regrouped / rearranged, wherever necessary.

Chairman : Nusli N. WadiaDirectors : Avijit Deb

:A.K.Hirjee: S. S. Kelkar: Pratap Khanna: Field Marshal Sam Manekshaw, M.C.: Nimesh Kampani: John Miller: Francois-Xavier Roger

Chief Executive Officer : Vinita BaliChief Financial Officer : N. Shridhar

®


57


Annual Report2004-2005 STATEMENT OF VALUE ADDED

Rs. mn2004-05 2003-04

Sales including excise duty

Sales tax on turnover

Gross revenue

Less : Bought in materials and services

Value added

Add: Net income from other sources

Available for distribution

16,154

1,645

17,799

13,512

4,287

771

5,058

14,705

1,478

16,183

11,970

4,213

485

4,698

2004-05Rs. mn %

2003-04Rs. mn

To employees as salaries and wages, contribution

to retirement benefit and welfare expenses

To Government as taxes on profit, excise duty, octroi,

sales tax on turnover and tax on dividend

To shareholders as dividend

To funds retained including depreciation, etc.

for development

716

2,712

334

1,296

5,058

14.2

53.6

6.6

25.6

100.0

821

2,500

272

1,105

4,698

17.5

53.2

5.8

23.5

100.0

58

®



2oo72oRoe5port SIGNIFICANT RATIOS

2004-05 2003-04

MEASURES OF INVESTMENT

Return on equity Profit after tax % 33.5 . 27.6

Equity shareholders' funds

PAT + Dep. +/- Profit/loss on sale of fixed assetsCash flow per share +/- variation in long term liabilities Rs. 83.73 59.29

Number of equity shares

Book value per share Shareholders' funds

Number of equity shares .

Dividend cover Earnings per share

Rs. 185.65 171.64

times 3.8 3.4

Dividend (plus tax) per share

MEASURES OF PERFORMANCE

Profit margin Profit before tax & exceptional items % 14.5 13.1

Sales + Other Income

Debtors turnover Sales

Debtors + Bills receivable

Stock turnover Sales

Stock

MEASURES OF FINANCIAL STATUS

Debt ratio Borrowed capital

Equity shareholders' funds

Current ratio Current assets

Current liabilities

Tax ratio ' Tax provision

Profit before tax

r— ~rflffiMJcEat Healthy,

times 35.8 73.9

times 12.0 12.0

% 1.4 • 9.1

times 0.9 . 1.1

% 32.5 35.6

®

BMH 59

Think Better


2ooT2ooe5port TEN YEAR FINANCIAL STATISTICS : 1996 -2005

Rs. mn

Year ended 31st March

Assets employed

Fixed assets less depreciation& amortisation

Investments

Net current assets

Miscellaneous Expenditure

Financed by

Equity shares

Reserves & Surplus

Loan funds

Profits and appropriations

Sales

Profit before Depreciation,Amortisation and tax

Depreciation and Amortisation

Profit before tax andExceptional items

Exceptional Items

Profit before tax*

Taxation

Profit after tax

Dividends

Tax on dividend

1996

714

871

68

-

1,653

186

741

726

1,653

6,024

324

54

270

-

270

110

160

74

-

1997

853

731

78

-

1,662

186

838

638

1,662

7,523

368

73

295

-

295

116

179

74

7

1998

1,277

912

7

-

2,196

186

1,026

984

2,1.96

8,478

542

118

424

-

424

135

289

93

9

1999

1,353 1

1,293 1

18

-

2000

,306

,470

65

'122

2,664 2,963

186

1,308 1

1,170 1

279

,586

,098

2,664 2,963

10,301 11

735

159

576

-

576

180

396

102

11

,698

962

172

790

19

771

261

510

125

14

Debenture Redemption Reserve _ _ _ _ _

Retained earnings

* Includes impact on account

86 98 187 283 371

of transfer of dairy business Rs. 1,257 mn

60

<s>

[BRITANNIA!**•£***•Eat Healthy, Think Better

2001

1,588

2,156

257

163

4,164

279

2,123

1,762

4,164

2002

1,632

3,104

592

217

5,545

269

3,430

1,846

5,545

2003

1,481

2,969

747

260

5,457

259

3,653

1,545

5,457

13,325 14,510 13,491

1,211

189

1,022

117

1,139

434

705

153

16

47

489

in 200 1-02

1,463

240

1,223

1,368

2,591

559

2,032

201

-

14

1,564

1,690

261

1,429

44

1,473

482

991

251

32

18

692

2004

1,283

2,913

43

463

4,702

251

4,059

392

4,702

14,705

2,187

224

1,963

(119)

1,844

656

1,188

272

35

-

910

2005

1,277

3,300

(423)

342

4,4%

239

4,196

61

4,496

16,154

2,610

190

2,420

.(217)

2,203

715

1,488

334

47

-

1,117


BRITANNIA INDUSTRIES LIMITEDRegistered Office: 5/1 A, Hungerford Street, Kolkata - 700 017

NOTICE

NOTICE IS HEREBY GIVEN THAT THE EIGHTY-SIXTH ANNUAL GENERAL MEETING OF THE MEMBERS OFBRITANNIA INDUSTRIES LIMITED WILL BE HELD ON WEDNESDAY THE 20th JULY 2005 AT 10.30. A.M. ATHOTEL OBEROI GRAND, 15, JAWAHARLAL NEHRU ROAD, KOLKATA 700 013, TO TRANSACT THE FOLLOWINGBUSINESS:

ORDINARY BUSINESS:

1. To receive, consider and adopt the Audited Profit and Loss Account for the year ended 31st March, 2005 and theBalance Sheet as on that date and the Reports of the Directors and the Auditors thereon.

2. To declare Dividend on the issued Equity share capital of the Company for the year ended 31st March 2005.3. To appoint a Director in place of Mr. S. S. Kelkar, who retires by rotation and being eligible, offers himself for

reappointment.4. To appoint a Director in place of Mr. Pratap Khanna, who retires by rotation and being eligible, offers himself for

reappointment.5. To consider and, if thought fit, to pass with or without modification(s) the following Resolution as an Ordinary

Resolution:

RESOLVED THAT the vacancy caused by the retirement by rotation of Field Marshal Sam Manekshaw M. C.,who has not sought reappointment, be not filled in at this Meeting or at any adjournment thereof.

6. To appoint Messrs. Lovelock & Lewes, Chartered Accountants, as Auditors of the Company to hold office from theconclusion of the Eighty Sixth Annual General Meeting upto the conclusion of the Eighty Seventh AnnualGeneral Meeting of the Company and to authorise the Board of Directors of the Company to fix their remuneration.

7. To consider and, if thought fit, to pass with or without modification(s) the following resolution as an Ordinary Resolution:

RESOLVED THAT pursuant to Sections 198, 269, 387 and other applicable provisions, if any, and Schedule XIIIof the Companies Act, 1956, including any statutory modification(s) and/or re-enactment thereof, the Companyhereby approves the appointment and the remuneration (including performance awards/incentives, perquisites,benefits and amenities) of Ms. Vinita Bali as 'Manager' of the Company from 24th January, 2005, for a period offive years on the terms and conditions set out in the Agreement dated 16th May, 2005.

RESOLVED FURTHER THAT subject to the limits contained in Sections 198, 269, 387 and other applicableprovisions, if any, of the Companies Act, 1956, the Board of Directors of the Company be and is hereby authorised,from time to time, to revise the remuneration payable to Ms. Vinita Bali as the Manager of the Company, by wayof salary, allowances, perquisites and performance awards/incentives, within the limits specified in the aforesaidAgreement and also to modify other terms and conditions of her appointment as may be considered by the Boardof Directors to be in the best interests of the Company.

8. To consider and, if thought fit, to pass with or without modification(s), the following resolution as a SpecialResolution:

RESOLVED THAT pursuant to the provisions of Section 309 and other applicable provisions, if any, of theCompanies Act, 1956, when the Company has a Managing or Wholetime Director or a Manager, such sum by wayof commission not exceeding in the aggregate one percent per annum of the net profits of the Company computedin the manner laid down in Section 198 of the Companies Act, 1956 for each of the five financial years of theCompany commencing from 1st April, 2005, be paid to and distributed amongst such Directors of the Company[excluding Managing Director(s) and Wholetime Director(s)] as may be determined by the Board, the proportionand manner of such payment and distribution to be as the Board may from time to time decide.

RESOLVED FURTHER THAT, for the sake of clarification, the remuneration aforesaid shall be exclusive of feespayable to a Director for each of the Meetings of the Board or a Committee of the Board attended by him.

NOTES

a. The relevant Explanatory Statement pursuant to Section 173 of the Companies Act, 1956, setting out materialfacts relating to the business at Items 5, 7 and 8 of the Notice as set out above, is annexed hereto.

b. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT ONE ORMORE PROXIES TO ATTEND AND VOTE ON A POLL ONLY INSTEAD OF HIMSELF/ HERSELF AND THEPROXY NEED NOT BE A MEMBER.

A Proxy form duly completed and stamped, must reach the Registered Office of the Company not less than 48hours before the time for holding the aforesaid Meeting.



c. The Register of Members and Share Transfer Books of the Company will remain closed from 12th July 2005 to20th July 2005, both days inclusive.

d. All unclaimed dividends up to the financial year 1994-95 were transferred to the General Revenue Account of theCentral Government in terms of Section 205 A of the Companies Act, 1956 ("the Act"). Members who have notencashed their Dividend Warrants for the aforesaid years are requested to claim the amount from the Registrar ofCompanies, West Bengal, Kolkata.

Unclaimed dividends for the financial years 1995-96 & 1996-97 were transferred on 28th August, 2003 and21 st September, 2004 respectively to the Investor Education and Protection Fund ("IEPF") as required in terms ofSection 205C of the Act. No claim shall lie against IEPF or the Company in respect of the unpaid amounttransferred to IEPF.

Pursuant to the provisions of Section 205A of the Act, dividend for the financial year ended 31st March 1998,which remains unpaid or unclaimed for a period of 7 years from the date of its transfer to the unpaid dividendaccount of the Company is due for transfer to IEPF on 11th August 2005. Members who have so far not encashedthe Dividend Warrants for the above year are advised to submit their claim to the Company's Registrar and TransferAgents at their address given hereinbelow immediately quoting their folio number/DP ID & Client ID. It may benoted that once the unclaimed dividend is transferred to IEPF as aforesaid, no claim shall lie in respect of suchamount by the members.

e. Members are requested to immediately intimate change of address, if any, to the Transfer Agents or DepositoryParticipant, as the case may be.

f. Members/Proxies should bring the Attendance Slip sent herewith, duly filled in, for attending the Meeting.

g. Members who hold shares under more than one folio in name(s) in the same order, are requested to send the relativeshare certificate(s) to the Company-at its Registered Office for consolidating the holdings into one account. TheShare Certificate(s) will be returned by the Company after consolidation.

h. Members holding shares in dematerialised form, may please note that while opening a depository account withParticipants they may have given their bank account details, which will be printed on their dividend warrants.However, if members want to change/correct the bank account details, they should send the sarhe immediately tothe concerned Depository Participant. Members are also requested to give the MICR code of their bank to theirDepository Participant. The Company will not entertain any direct request from members for deletion/change inthe bank account details furnished by Depository Participants to the Company.

i. Members who hold shares in the physical form can nominate a person in respect of all the shares held by themsingly or jointly. Members who hold shares in single name are advised, in their own interest to avail of thenomination facility by filling Form 2B. Members holding shares in the dematerialised form may contact theirDepository Participant for recording nomination in respect of their shares.

j. Members are requested to bring their copy of the Annual Report to the Annual General Meeting.

k. All documents, transfers, demat requests and other communications in relation thereto should be addressed toM/s. SHAREPRO SERVICES directly at their following office:

REGISTERED OFFICE:M/s. Sharepro Services (India) Pvt. Ltd.Unit: Britannia Industries LimitedAbove Bank of Baroda,Satam Estate, 3rd Floor,Cardinal Gracious Road,Andheri (E), Mumbai - 400 099

1. Dividend on Equity Shares as recommended by the Directors for the financial year ended 31st March 2005, whendeclared at the Meeting will be paid to those Members whose names appear on the Register of Members of theCompany.after giving effect to all valid share transfers in physical form lodged with the Registrars & ShareTransfer Agents of the Company on or before llth July 2005, or in respect of Shares held in electronic form, tothose "Deemed Members" whose names appear in the statement of beneficial ownership furnished by NSDL andCDSL as at the end of business hours on 11th July 2005.

By Order of the Board of DirectorsFOR BRITANNIA INDUSTRIES LIMITED

Registered Office:5/1 A, Hungerford Street,Kolkata - 700 017. S. S. KELKAR26th May, 2005 Director


SANSCO SERVICES - Annual Reports Library Services -www.sansco.net

I. EXPLANATORY STATEMENT pursuant to Section 173(2) of the Companies Act, 1956

ITEM NO. 5Field Marshal Sam Manekshaw M C retires by rotation at this Annual General Meeting. However, he has intimated tothe Company that he does not seek reappointment. The Company does not propose to fill up this vacancy at thisMeeting or any adjournment thereof, but may do so at a later date. Hence, as required by Section 256 of the CompaniesAct, 1956, a Resolution is proposed not to fill up the vacancy caused by the retirement of Field Marshal Sam ManekshawM C at this Meeting or any adjournment thereof.

ITEM NO. 7

Mr. Nikhil Sen, Chief Operating Officer ("COO") of the Company was appointed as "Manager" effective 8th August,2003. Mr. Nikhil Sen has since submitted his resignation from the services of the Company and would relinquish chargeat the close of business hours of 31st May, 2005.

Pending relinquishment of charge by Mr. Nikhil Sen, the Board of Directors at its Meeting held on 24th January 2005,appointed Ms. Vinita Bali, under the provisions of Section 269 of the Companies Act, 1956, as Manager of theCompany with effect from that date for a period of five years on the terms and conditions set out in the Agreement dated16th May, 2005, entered into with her. Since 24th January, 2005, Ms. Vinita Bali has had the overall responsibility formanagement of the Company as 'Manager'. Her current basic salary and variable allowance are Rs. 6,000,0007- and Rs.5,050,000/-per annum respectively. Subject to the limits prescribed under the Companies Act, 1956, the Company may,however, pay, by way of basic salary and allowances as the Board may determine, from time to time, an amount notexceeding a maximum limit of Rs. 17,000,0007-.

In addition to the above remuneration, the Board may sanction perquisites such as accommodation or house rentallowance, furnishings, driver facility, medical reimbursement, leave travel concession, club fees, insurance and otherbenefits and amenities as per the rules of the Company for the time being in force, the monetary value of all suchperquisites being restricted to Rs. 5,000,0007- per annum. The Board may at its sole discretion sanction additionalperformance awards/incentives of such sum as may be determined from time to time based on such criteria as may belaid down from time to time. The total remuneration including the performance awards/incentives, perquisites andcontribution to the Retiral Funds shall, however, not exceed the overall ceiling of 5% of the net profits, calculated inaccordance with Schedule XIII and other applicable provisions of the Act.

Ms. Vinita Bali shall be entitled to reimbursement of all reasonable expenses like travelling, entertainment/businesspromotion and other out of pocket expenses incurred by her in connection with or in relation to the business of theCompany duly approved by the Chairman. Ms. Vinita Bali shall also be entitled to a housing loan facility of upto Rs.5,000,0007- and a one time loan to acquire white goods worth Rs. 1,000,0007-. The Board will have the authority at itssole discretion from time to time to fix her remuneration including performance awards/incentives and perquisiteswithin the overall limit specified above and revise the same from time to time within such maximum limits as specifiedin the Agreement.

The Agreement between Ms. Vinita Bali and the Company may be terminated by either party by giving a six monthnotice in writing without assigning any reason for the termination. The Company can also terminate the Agreementupon the payment of six months' salary to Ms. Vinita Bali in lieu of notice.

A copy of the Agreement entered into between the Company and Ms. Vinita Bali shall be available for inspection at theRegistered Office of the Company during office hours on any working day.

Your Directors recommend the above resolution for approval by the shareholders. None of the Directors are concernedor interested in the above resolution.

ITEM NO. 8

In view of the overall growth of the Company and the consequent increase in the duties and responsibilities of theDirectors, it is considered desirable and appropriate that in accordance with the provisions of Section 309 of theCompanies Act, 1956, when the Company has a Managing or Whole-time Director or a Manager, a commission, notexceeding in the aggregate 1 % per annum of the net profits of the Company computed in the manner laid down inSection 198 of the Companies Act, 1956, for each of the five financial years commencing on and from 1st April, 2005,may be paid to and distributed amongst the Directors of the Company {excluding the Managing and Whole-timeDirector(s)}, the quantum of such payment within the aforesaid limit, the proportion and manner of payment to bedetermined by the Board of Directors from time to time.

The Special Resolution is necessary having regard to the provisions of Section 309(4) of the Companies Act, 1956. TheDirectors recommend the resolution for the approval of the Shareholders and all the non-executive directors are deemedto be concerned or interested in the above resolution. .



II AS REQUIRED UNDER CLAUSE 49(VI) OF THE LISTING AGREEMENT, GIVEN BELOW ARETHE DETAILS OF THE DIRECTORS SEEKING REAPPOINTMENT :

Mr. S S Kelkar

Mr. S S Kelkar, is a Post Graduate in Commerce and has retired as an Executive Director of The Bombay Dyeing &Manufacturing Company Limited. He is associated with The Bombay Dyeing & Manufacturing Company Limitedfor over 31 years and has held various positions in the functional areas of finance besides having previous bankingexperience. He continues his association with The Bombay Dyeing & Manufacturing Company Limited as a Non-Executive Director. He is also on the Board of several leading companies as listed below:

Name of the Company

The Bombay Dyeing & Mfg. Co. Limited

Nowrosjee Wadia & Sons LimitedKotak Mahindra Asset Management Co. Limited

Placid Plantations LimitedNational Peroxide Employees' Co. LimitedWadia BSN LimitedHarvard Plantations LimitedMacrofil Investments LimitedNaperol Investments LimitedP.T. Five Star Textile Indonesia, BandungAssociated Biscuits International Limited, LondonABI Holdings Limited, LondonMillowners' AssociationGo Airlines (India) Private LimitedStandard Chartered Trustee Company Private Limited

Designation

Director

DirectorDirector

DirectorDirectorDirectorDirectorDirectorDirectorCommissionerAlternate DirectorAlternate DirectorMemberDirectorDirector

Chairmanship/Membershipof Committees of the Board

Audit CommitteeShare Transfer & Shareholders/Investors Grievances CommitteeAudit CommitteeAudit CommitteeRemuneration Committee

Mr. S. S. Kelkar is also a member of the Share Transfer and Shareholder/Investor Grievance Committee of BritanniaIndustries Limited.

Mr. Pratap Khanna

Mr. Pratap Khanna has been associated with Britannia Industries Limited since 1948, when he joined the Companyas a trainee. Since then he had been serving the Company in various capacities including as the General Managerof the Delhi Branch. Mr. Khanna served as a Director of the Company from 1973 till his retirement in 1983. Mr.Khanna was re-elected to the Board in 1994 as a Non-Executive Director and continues to serve in that capacity.

Mr. Pratap Khanna is a BA and LLB from the Delhi University. He has served as the Chairman of the Processed FoodsExport Promotion Council, President of the Delhi Factory Owners' Federation and as President of the Society ofIndian Bakers. He has also been a distinguished member of the PHD Chamber of Commerce and Industry.

At present, he is the President of Punjab Sindh Kshetra, Rishikesh, an organisation doing vast charitable work.

He is not a Director in any other company nor is he a member of any Board Committee.

Registered Office:5/1 A, Hungerford Street,Kolkata - 700 017.26th May, 2005

By Order of the Board of DirectorsFOR BRITANNIA INDUSTRIES LIMITED

S. S. KELKARDirector

®




BRITANNIA INDUSTRIES LIMITEDRegistered Office : 5/1 A, Hungerford Street, Koikata - 700 017

A T T E N D A N C E SL IP

86!h ANNUAL GENERAL MEETING - 20th Julv, 2005

I certify that i am a registered Member/Proxy for the registered Member of the Company. I hereby record mypresence at the 86th ANNUAL GENERAL MELTING ot" the Company to be held at Hotel Obetoi Grand,Kolkata - 700 01 3 on Wednesday, 20th Julv, 200r, at 1 0/iO a.m.

Member's Si''nature

Proxy's name should be written here inBLOCK letters.

NOTE : Members/Provyhnlders ate requestedsame at the cntraru •;• du!v signed.

BRITANNIA INDUSTRIES LIMITED

P R O X Y F O R M

I/We

or

Britannia Industries Limited, hereby appoint

of

or tailing him/her _„_ _ _ _ or ' . . . . . . . .

proxy to attend and vote tor me/us and on niv/c-u; btTi.ilt al !he 86th ANNIJA!. (jLNF.RAI. Mf I

Company to be held on Wednesday, 20ih luiy. 2U(r> ,*! 10 .50 a.m and/or al any adjournment there »

As witness my/our handis; this • .Ln. - •'

Signed by the said

L.K No. /C l ient ID and DP H > No IN300513/10167027

NOTES : 1. The Proxy Form signed across revi-nue starn}! mu^l be tefiU^ned so as to "re. ' tch theRegistered Office of the Company at VIA, Hungeriord Stret-!.. Kolkala - 700 017 noi laiec MianFORTY-EIGHT HOURS before the commenternem < > i \\w aforesaid meeting.

2. A Proxy need not be a member of the Company.

BRITANNIA - Morningstar, Inc.

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