To the Members,

The Directors have pleasure in presenting the 25th Annual Report and Audited Accounts of the Company for the year ended 31st March, 2018.

FINANCIAL RESULTS

(Rs. in Lakhs)

DIVIDEND

The Directors are pleased to recommend a dividend of 5% on equity shares.

OPERATIONS

The Revenue from Operations increased to Rs 24,576 Lakhs during the year as compared to Rs 21,076 Lakhs in the previous year, clocking a growth of 16.61%. The capacity utilization for the year stood at 48% compared to 29% in the previous year. The Company is continuing to invest behind retail distribution expansion and up-gradation of distribution infrastructure. This will help in driving sales and distribution for the consumer products.

Company has been able to retain its market share in Dairy Creamer segment with its brands JK WHITE MAGIK, JK DAIRY TOP & MILK STAR. JK Dairy Top continues to maintain its leadership in the mid segment of dairy creamers. Single serve sachets of 3gm and 5 gm of White Magik have found greater acceptance by Hospitality, HORECA segment and Institutional buyers.

The Company has also developed a market for Bulk products including SMP and Ghee. These products are being sold in retail and consumer markets.

Company continued its focus in Pre-Mix powders for tea and coffee vending machines. Company continued its good business and relations with institutional clients like Coca Cola, Walmart etc.

Significant effort was also made during the year to increase efficiency at plant by focusing on utility costs and manpower productivity to gain efficiency resulting in better profitability.

For the year 2017-18 the milk prices remained volatile and high throughout the year. For year 2018-19 we expect Milk prices to be soft which will reduce the prices of raw material significantly. This is also likely to create excess availability of powders and ghee in the industry effectively pushing down prices for the commodities.

LIQUID MILK PLANT

Your Company operates and manages a facility owned by another Company to process and pack Liquid Milk in poly pouches for Mother Dairy, under a long term agreement. Capacity utilization for the year was at 88%.

The Curd Chhach facility started during the year stabilized production and we were able to supply the finished goods to Mother Dairy of required quality and capacity. We expect the capacity utilization of this plan to be as per budgeted volumes for 2018-19.

EXPANSION AND MODERNIZATION PLANS

Company wishes to become a significant player in Dairy & Foods space. The Company has set up a small plant for Paneer manufacturing which is under stabilization process and expected to start commercial production from Q1 onwards 2018-19.

Besides modernization of Plant and R&D facilities, Company is planning to expand production facility of Drying Plant by removing the bottlenecks and modification in the dryer. The Company is planning to invest resources behind expanding distribution of the recently launched products of Cow Ghee, Canned Paneer, UHT Milk to gain Market Share.

Company is also working on developing new value added products which are under different stages of development at R&D.

RAW MATERIAL SECURITY

Company is sanguine about the fact that to sustain a value added product portfolio, it is highly imperative to have captive milk bank where milk is collected direct from the farmers. As it is, Company is one of the few ones who have more than two decades old village level collection system under which milk is collected from nearly 525 villages comprising of about 18500 farmers.

The company will continue its efforts to expand the Village level collection system in the vicinity to ensure quality milk supplies. We also have a panel of contractors who can supply good quality milk at short notice as and when required.

ADULTERATION & FOOD SAFETY

Umang Dairies Ltd has FSSAI License, in addition to this all our Milk Chilling Centers and Warehouses are also covered under FSSAI.

The company has always focused on Good Manufacturing Practices(GMP) and Hygienic Practices as part of its culture. All incoming Milk Consignments are being screened for Adulteration as per the Guideline of FSSAI to maintain purity of Milk and resultant products.

Recently, National Dairy Development Board (NDDB) has awarded most coveted Quality Marks for Packing Operation of Poly Pack Milk under Mother Dairy Brand.

Our units have been successfully audited for quality and GMP practices by companies like Coke, Nuflower, Walmart, Spar on GMP & Food Safety for Business Continuation.

EXTRACT OF ANNuAL RETuRN

An extract of the Annual Return as on 31st March 2018 in the prescribed form MGT -9 is attached as Annexure-1 to this Report and forms part of it.

particulars OF LOANS, GuARANTEES OR INVESTMENTS

The particulars of loans, guarantees or securities and investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the financial statements.

related party TRANSACTIONS

During the financial year ended 31st March 2018, all the contracts or arrangements or transactions entered into by the Company with the Related Parties were in the ordinary course of business and on arm’s length basis and were in compliance with the applicable provisions of the Companies Act, 2013 and SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.

Further, the Company has not entered into any contract or arrangement or transaction with the Related Parties which could be considered material in accordance with the Policy of the Company on materiality of Related Party Transactions. In view of the above, disclosure in FORM AOC-2 is not applicable.

DIRECTORS AND Key Managerial pERSONNEL

Smt. Sharda Devi Singhania retires by rotation and being eligible offers herself for re-appointment at the ensuing AGM.

All the Independent Directors of the Company have given requisite declarations that they meet the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and also Regulation 16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Shri N. C. Baheti, ceased to be Manager under Companies Act, 2013 on 10th May, 2017.

corporate SOCIAL RESpONSIBILITY

The Company has framed Corporate Social Responsibility (CSR) Policy in accordance with the provisions of the Companies Act 2013 and rules made thereunder.

A detailed report on Company’s CSR activities along with the annual report on the CSR activities undertaken by the Company during the financial year under review, in the prescribed format is annexed to this Report as Annexure-2.

AuDITORs

(a) Statutory Auditors and their Report

M/s Singhi & Co., Chartered Accountants, have been appointed as Auditors of the Company to hold the office from the conclusion of the 24th Annual General Meeting held on 27th September 2017 until the conclusion of the 29th Annual General Meeting to be held in year 2022, subject to ratification of the appointment by the members at the respective AGMs. Accordingly, matter relating to the appointment of the Auditors will be placed for ratification by members at the forthcoming AGM. The observations of the Auditors in their report on Accounts and the Financial Statements, read with the relevant notes are self explanatory.

(b) Secretarial Auditor and Secretarial Audit Report

Pursuant to the provisions of Section 204 of the Companies Act, 2013, the Board of Directors appointed Shri Namo Narain Agarwal, Company Secretary in Practice as Secretarial Auditor to carry out Secretarial Audit of the Company for the financial year 2017-18. The Report given by him for the said financial year in the prescribed format is annexed to this Report as Annexure-3. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

(c) Cost Auditor and Cost Audit Report

The Cost audit for the year ended 31st March 2018 is being conducted by M/s Sanjay Kumar Garg & Associates, Cost Accountants and the report will be submitted to the Ministry of Corporate Affairs, Government of India.

significant and material orders passed by the regulators OR courts OR TRIBuNALs

The Company was forced to temporarily shut down its plant at Gajraula w.e.f. 28th April, 2017 since the Hon’ble National Green Tribunal (“NGT”), ordered closure of certain units of Gajraula including that of the Company, for suspected disposal of effluents. Upon submission, NGT later passed an order permitting the operations w.e.f. 16th May 2017 at our plant at Gajraula.

The Company is equipped with a state-of-the-art effluent treatment plant with RO and has a “zero liquid discharge” operation status.

There were no other significant and material orders passed by the Regulators or Courts or Tribunals which would impact the going concern status of the Company and its future operations.

The Company is environmentally conscious and operates its plant in Gajraula (U.P.), with zero discharge and is in compliance with all applicable environmental norms and laws including previous consents from NGT and State Pollution Control Board.

conservation OF energy etc.

The details as required under Section 134(3)(m) read with the Companies (Accounts) Rules, 2014 is annexed to this Report as Annexure-4 and forms part of it.

particulars of remuneration

Disclosure of the ratio of the remuneration of each director to the median employee’s remuneration and other requisite details pursuant to Section 197 (12) of the Companies Act, 2013 read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed to this Report as Annexure-5. Further, Particulars of Employees pursuant to Rule 5(2) & (3) of the above Rules, form part of this Report, However, in terms of provisions of Section 136 of the said Act, the Report and Accounts are being sent to all the members of the Company and others entitled thereto, excluding the said particulars of employees. Any member interested in obtaining such particulars may write to the Company Secretary. The said information is available for inspection at the Registered Office of the Company during working hours.

corporate governance

Corporate Governance - including details pertaining to Board Meetings, Nomination and Remuneration Policy, Performance Evaluation, Risk Management, Audit Committee and Vigil Mechanism:

Your Company reaffirms its commitment to the highest standards of corporate governance practices. Pursuant to Regulation 34 (3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a Management Discussion and Analysis,

Corporate Governance Report and Auditors Certificate regarding compliance of conditions of Corporate Governance are made a part of this Report.

The Corporate Governance Report which forms part of this Report, also covers the following:

a) Particulars of the Four Board Meetings held during the financial year under review.

b) Policy on Nomination and Remuneration of Directors, Key Managerial Personnel and Senior Management including, inter alia, the criteria for performance evaluation of Directors.

c) The manner in which formal annual evaluation has been made by the Board of its own performance and that of its Committees and individual Directors.

d) The details with respect to composition of Audit Committee and establishment of Vigil Mechanism.

e) Details regarding Risk Management.

DEPOSITS

The Company has not taken any deposits from the public.

DIRECTORS’ RESPONSIBILITY STATEMENT

As required under Section 134(3)(c) of the Companies Act, 2013, your Directors state that:-

(a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any ;

(b) the accounting policies have been selected and applied consistently and judgments and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

(c) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the said Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) the annual accounts have been prepared on a going concern basis;

(e) the internal financial controls to be followed by the Company have been laid down and that such internal financial controls are adequate and were operating effectively; and

(f) the proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

cautionary statement

Management Discussion and Analysis Report contains forward looking statements which may be identified by the use of words in that direction or connoting the same. All statements that address expectations or projections about the future, including, but not limited to statements about the Company’s strategy for growth, product development, market position, expenditures and financial results are forward looking statements.

These are based on certain assumptions and expectations of future events. The Company cannot guarantee that these assumptions and expectations are accurate or will be realized. The Company’s actual results, performance or achievement could thus differ materially from those projected in any such forward looking statements. The Company assumes no responsibility to publicly amend, modify or revise such forward looking statements, on the basis of any subsequent development information or events.

acknowledgement

The Directors wish to thank its Customers, Shareholders, Banks, Dealers, Suppliers and Government Authorities for their continued support.

The Board also places on record its sincere appreciation of the hard work, put in by the employees at all levels during the period under report.

On behalf of the Board of Directors

Place : New Delhi D.B. DODA R.C. Periwal

Date : 3^rd May 2018 (Director) (Director)