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You can view full text of the latest Director's Report for the company.

BSE: 539889ISIN: INE883N01014INDUSTRY: Food Processing - Bakery/Dairy/Fruits/Others

BSE   ` 242.50   Open: 243.00   Today's Range 240.60
+0.00 (+ 0.00 %) Prev Close: 242.50 52 Week Range 223.00
Year End :2017-03 

Dear Members,

The Directors are pleased to present the Twenty Fifth Annual Report on the business and operations of your Company together with the Audited Financial Statements for the year ended March 31, 2017.


The comparable financial performance of the Company (Standalone & Consolidated) for the Financial year 2016-201 7 is summarized as under:

(Rs, In Millions)




FY 2016-2017

FY 201 5-2016

FY 2016-2017

FY 201 5-2016

Total Revenue





Earnings before interest, Depreciation and Tax


1 503.87



Less :- Depreciation





Less - Interest





Profit before Tax





Less - Tax expenses





Profit After Tax (PAT)





Balance brought forward from previous year





Less:- Appropriations

a) Transfer to Debenture Redemption reserve





b) Bonus share issued





c) Minority Interest





Balance carried forward to Balance-Sheet





Earnings per Share

- Basic





- Diluted






In the current economic environment despite demonetization and subdued rural demand where in business had slowed down, your company achieved a sales growth of 5.14% during the year; your Company registered a total income of Rs, 1 7,078.09 Million in the Financial Year 2016 -201 7 as compared to Rs, 16,243.85 Million of the previous year. The Company has made Profit before tax (PBT) of Rs, 277.57 Million on standalone basis for the year under review as compared to Rs, 699.47 Million for the previous year, the decrease was mainly on account of increase in raw material prices which the Company was partially able to pass to the customers.


Your Directors are pleased to recommend a dividend at a Rs, 0.50 per equity share of face value of Rs, 10/- (i.e. 5%) out of the profits of the financial year ended March 31, 2017 on 841,14,582 of Rs, 10/- each fully paid up equity shares, if approved by the members in the ensuing Annual General Meeting.

During the year under review, your Company transferred a sum of Rs, 4.50 Million to the Debenture Redemption Reserve.

During the year under review, no amount from profit was transferred to General Reserve.


Your Company is a leading manufacturer and marketer of dairy-based branded food products in India commencing business in 1992 with collection of milk and distribution of milk.

Your Company's focus is now in transforming itself into a "Dairy FMCG Company" with focus on "Health and Nutrition" and this will be through a multi brand strategy. Your Company's integrated business model gives it a strong edge over dairy companies, with diverse manufacturing capabilities of products like cheese, ghee, fresh milk, whey proteins, paneer, curd, yoghurt, milk powder and dairy based beverages targeting a wide range of consumer groups through several brands under the flagship brands "GOWARDHAN" "GO" "TOPP UP" " MILK RICH" and "PRIDE OF COWS"

Your Company's focus has been product innovations and towards that effect we expanded our cheese slice range last year with flavours like Piri Piri, chutney cheese, Kachha Aam, Schezwan and Acchari and other product categories like Pre-mix with Go Easy Shake and relaunched our dairy whitener under Milk Rich brand name Continuing our Endeavour of strengthening our brand communication, we launched the new communication for Ghee with the theme of "Pyar ka Rang Sunhera" with the philosophy of owning the golden colour of cow ghee. The high point of the campaign was the Mother's Day video which created new records in terms of viewership.

Gowardhan Ghee has for the 2nd year in succession been awarded the most trusted brand in ghee category with "Brand Trust" and has infact moved 132 notches up in the overall ranking of brands across categories.

Your Company's focus on Cheese category continues and towards that Endeavour we launched a new campaign with 5 new films with Celebrity Vir Das with focus on the new flavours of Cheese Slice.

"Cheese Lover's Day" is one more property that we have created and started owning the same with specific campaign led by social media and print which has helped in enrolling newer consumers to the category of cheese.

Our distribution expansion continues as per plan with 4 new depot locations being added and super stockiest up to 120 catering to over 3000 distributors who in turn cater to more than 2.5 lakh outlets directly.

Your company's Route to Market strategy is further strengthened with beverages business focus on point of consumption outlets and expansion of Horeca segment at a rapid pace.

During the year, your company has also expanded distribution of fresh milk in upcountry Tamil Nadu market.

Our manufacturing facilities are being further strengthened with capacity expansion in Cheese and Paneer as per plan in Manchar.

Your Company's building new capabilities and robust pipeline of innovations resulted in new launches in the form of "GO Easy Shake", "GO Cheese Slice" in new flavors suited for Indian palate and "Milk Rich" and other innovative products coupled with leading edge route to market strategy, while building brand differentiation and relevance.

Export Market

Your Company has presence in the international markets like UAE, Singapore, Oman, Kuwait, Mauritius, New Zealand, Australia,

Congo, Seychelles, Iraq. Company has extensive Cheese demand from international market and supplying bulk Cheese to Philippines, Sri Lanka, UAE and Bangladesh. During the year the Company's Export of consumer products increased by 79 % as compared to the year 2015 - 16. The total export sale for financial year was Rs, 568 Million against Rs, 318 Million last year.

Company has participated in Overseas Exhibitions Gulfood 2017 and Food Moscow in year 2016 -17. Your company has extended its market in new Territories including USA, Qatar, Saudi Arabia, etc.

Future Prospects

The distribution expansion focus now shifts to building cold chain distribution in top 100 cities with focus on Paneer and Cheese.

The distribution capabilities are being further enhanced with roll out of SFA (Sales force automation) and DMS (Distribution management system) which will help with real time data on secondary sales.

This coupled with our association with a consulting firm "Vector Consulting" will help build supply chain and logistics capabilities at the back end and distribution capabilities in the front end. This project is specifically based on the concept of "Theory of Constraints" and will help in driving efficiencies in the entire system.

With our core objective of building our business around "Health & Nutrition" we are working on new horizon categories like sports nutrition where your company is launching "Avvatar" whey powder.

Along with this, we are working on launching protein powders for the mass and whey drinks as well.

One more category where your company wants to focus is the fruit drink market but with a differentiated product offering. Your company is entering this market with a new brand "Slurp" which is a mango fruit based beverage with a dash of milk.

Our marketing approach towards brand building with 360-degree approach continues with focus on digital medium and that's the new way of working for your company and it is yielding results reflected in the brand health scores that we track on our brands.

The above initiatives being dovetailed with focus on operational efficiencies being built at plant level, marketing initiatives to build brands and focus on quality distribution expansion and capability building of the sales team would help build the consumer business with accelerated pace.


The Paid Up Capital of the Company as on March 31, 2017 stood at ' 841,145,820/-. Your Company had during the year raised ' 3,000 Million through fresh issue of 136.99 Million equity shares. The Company has not issued shares with differential voting rights nor has granted any stock options or sweat equity during the year under review. None of the Directors of the Company hold instruments convertible into equity shares of the Company.


The Company had instituted the ESOP Trust in the name of" Parag Milk Foods Employees Stock Option Trust" and the "Parag Milk Foods Limited- Employee Stock Option Scheme 2015" (ESOS 2015) in April, 2015 pursuant to resolutions dated February 27,

2015 and April 21, 2015 passed by the Board of Directors and the resolutions dated April 3, 2015 and May 16, 2015 passed by the Shareholders. The ESOS 2015 is compliant with the SEBI (Share Based Employee Benefits) Regulations, 2014 and the relevant provisions of the Companies Act 2013 along with the Rules made there under including any amendments made there to or notifications thereof.

The ESOS 2015 is administered by the ESOP Trust, 227,000 Equity shares were allotted to the ESOP Trust on September 3, 2015. The Options were granted to the eligible employees pursuant to the Nomination & Remuneration Committee meeting on September 04, 201 5. The Nomination & Remuneration Committee on June 24, 2016 approved vesting of the options in accordance with the ESOS 2015 and conditions of grant based on the Company's performance during the financial year 2015

2016 and subject to the continued employment of the eligible employees till September 03,2016 and that the right to exercise would extinguish on September 03, 2018. Details required to be provided under section 62 of the Companies Act, 2013 and Rule 12(9) of Companies (Share Capital and Debenture Rules, 2014) and SEBI (Share Based Employee Benefits) Regulations, 2014 are set out in the Annexure - II to this report


There are no material changes and commitments affecting the financial position of the Company which have occurred subsequent to close of the financial year and the date of this report


Your Company has significantly enhanced the capacity built up by way of capital expenditure in plant and machinery at Manchar and Palamaner plant from time to time. The Company has made additions amounting to ' 588.39 Million as on March 31, 2017 as against additions of ' 891.26 Million as on March 31, 2016 in the Gross block of Fixed Assets for the year ended March 31, 2017.


Pursuant to clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, the Directors hereby confirm that;

(a) i n the preparation of the annual accounts for the financial year ended March 31, 2017, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(b) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for the year ended March 31, 2017.

(c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) the directors had prepared the annual accounts for the financial year ended March 31, 2017 on a going concern basis; and

(e) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.


Pursuant to the provisions of the Companies Act, 2013 read with the Rules issued there under, Regulation 17 (10) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as "Listing Regulations") a structured questionnaire was prepared after taking into consideration the various aspects of the Board's functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, obligations and governance.

The performance evaluation of the Board, its Committees, Independent Directors, Chairman and Individual Directors was conducted and the same was based on questionnaire and feedback from all the Directors on the Board as a Whole, its Committees and self-evaluation.

Based on the Questionnaire and feedback, the performance of every Director was evaluated by the Nomination and Remuneration Committee (NRC). The Board of Directors expressed their satisfaction with the evaluation process.

A separate meeting of the Independent Directors ("Annual ID Meeting) was convened on March 20, 201 7, which reviewed the performance of the Board (as a whole), the non-independent director and the Chairman. Post the Annual ID Meeting, the Collective feedback of each of the Independent Directors was discussed by the Chairperson of NRC with the Board covering performance of the Board as a whole, performance of the no independent directors and performance of the Chairman.


The Consolidated Financial Statements of the Company are prepared in accordance with relevant Indian Accounting Standards issued by the Institute of Chartered Accountants of India and forms an integral part of this Report.

Pursuant to Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement containing salient features of the financial statements of Subsidiaries/Associate Companies/Joint Ventures is given in Annexure-I in Form AOC-1 and forms an integral part of this Report.


As on March 31, 2017 the Company has one Wholly Owned Subsidiary called Bhagyalaxmi Dairy Farms Private Limited (BDFPL) which is located at Manchar, Pune District BDFPL which is fully automated cow farm housing over 2000 Holstein breed cows with superior quality yield. BDFPL was established with the aim to educate farmers about best practice of breeding, feeding, animal management and improving productivity.

The total revenue was ' 517.98 Million in FY 16-17 in comparison to ' 442.05 Million in FY 15-16 projecting a rise by 17.2%, Company made profit with a PAT of ' 71.05 Million for FY 16-17 in comparison to a loss in the previous year.

Bhagyalaxmi produces "Farm- to- Home" premium milk under the brand name of "Pride of Cows" (POC). The farm is equipped with the finest international technology for feeding, milking and processing, being fully automated without any human intervention, ensuring quality and safe milk. POC is premium milk, fresh, untouched, unadulterated milk, catering to three cities Mumbai, Pune and Surat.

Bhagyalaxmi Bioscience Division has introduced certified organic fertilizers through the commercialization of cow manure and cow urine into value added products. Bhagyalaxmi has launched the following products during the year under review.:

1. MicroRich - Organic slurry released as a by-product from the Biogas plant which is 100% organic and natural and rich in plant nutrients, increases resistance against pests & diseases.

2. Agrifeed - prepared from pure cow dung -increases the moisture storage capacity of the soil and makes the soil smooth & healthy, reduces cost of fertilization useful for all kinds of crops, improves soil fertility & soil productivity, safe for soil micro flora.

3. Goldmine - produced by co-composting high-grade phosphate rock with organic waste.

4. Nutricane - Helps to improve the production and productivity of the sugarcane crop. Improves water and nutrients uptake, reduces the use of chemical fertilizers

In compliance with Section 129 of the Companies Act 129 of the Companies Act, 2013 and Rule 8(1) of the Companies (Accounts) Rules, 2014, the Board's Report has been prepared on standalone financial statements and a report on performance and financial position of its subsidiary company is included in the financial statements


Your Board currently comprises of 8 Directors including 5 Independent Directors, 2 Executive Directors and 1 Non- Executive Director. Independent Directors provide their declaration both at the time of appointment and annually confirming that they meet the criteria of independence as prescribed under Sec 149 and 152 of Companies Act, 2013.

Pursuant to Sections 196, 197, 198 and Schedule V of the Companies Act 2013 shareholders' approval by special resolution is sought at this AGM for revision of remuneration of Mr. Devendra Shah Chairman and Mr. Pritam Shah Managing Director of the Company pursuant to schedule V as amended of the Companies Act, 2013.

In accordance with Section 152 of the Companies Act 2013 and the Articles of Association, Mr. Devendra Shah, Chairman of the Company retires by rotation at the forthcoming Annual General Meeting and being eligible offers himself for re-appointment. The Board recommends his re-appointment for consideration of the Members of the Company at the ensuing Annual General Meeting.

All Independent Directors have given declarations that they meet the Criteria of independence as laid down under Section 149(6) of the Companies Act 2013 and Regulation 16 of the Listing Regulations.

The Following continue to be the "Key Managerial Personnel" pursuant to the provisions of section 203 of the Companies Act 2013.

Mr. Devendra Shah as Chairman and Whole Time Director

Mr. Pritam Shah as the Managing Director

Mr. Bharat Kedia as Chief Financial Officer

Ms. Rachana A. Sanganeria as Company Secretary and

Compliance Officer


The Company recognizes that risk is an integral component of business and is committed to managing the risk in a proactive and effective manner.

The Company recognizes the importance of maintaining a good system of risk management and internal controls to safeguard shareholders' investment and the Company's assets. The Board acknowledges its overall responsibility for reviewing the adequacy and integrity of the Company's system of risk management and internal control, identifying principal risks and establishing an appropriate control environment and framework to manage risks and evaluating the Company's operational effectiveness and efficiency. Pursuant to section 134 (3) (n) of the Companies Act, 2013, the Company has in place an Enterprise Risk Management policy.

1. To ensure that all the current and future material risk exposures of the Company are identified, assessed, quantified, appropriately mitigated, minimized and managed i.e. to ensure adequate systems for risk management.

2. To establish a framework for the company's risk management process and to ensure its implementation.

3. To enable compliance with appropriate regulations, wherever applicable, through the adoption of best practices.

4. To assure business growth with financial stability.

5. Safeguard the Company's property, interests, and interest of all stakeholders.

6. Evolve the culture, processes and structures that are directed towards the effective management of potential opportunities and adverse effects, which the business and operations of the Company are exposed to.

7. Balance between the cost of managing risk and the anticipated benefits.

8. To create awareness among the employees to assess risks on a continuous basis & develop risk mitigation plans in the interest of the Company.

9 Provide a system for setting of priorities when there are competing demands on limited resources.

The objective of this policy is also to manage the risks involved in all activities of the Company to maximize opportunities and minimize adversity. This policy is intended to assist in decision making processes that will minimize potential losses, improve the management of uncertainty and the approach to new opportunities, thereby helping the Company to achieve its objectives.

Pursuant to Section 134(5)(e) of The Companies Act, 2013 the Company has in place an elaborate internal control system commensurate with the size and nature of its business and size and complexity of its operations. The primary objective of the Internal control systems comprising of policies and procedures are designed to ensure reliability of financial reporting, timely feedback on achievement of operational and strategic goals, compliance with policies, procedure, applicable laws and regulations to ensure proper authorization and accounting of transactions as also for safeguarding and protecting Company's assets and that all assets and resources are acquired economically, used efficiently & adequately protected and to prevent any revenue leakage and losses to the Company against loss. Pursuant to Section 138 of the Companies Act, 2013 the Company has appointed M/s. KPMG (in India) as Internal Auditors of the Company The internal auditors' reports are periodically reviewed by the management and the Audit Committee and necessary corrective actions are taken from time to time The Audit Committee submits its periodical report to the Board about the measures taken for mitigation of Risk in the organization.


The Board meets at regular intervals to discuss and decide on Company's business policies and strategy apart from other Board businesses. A notice of the Board Meeting is circulated well in advance with the agenda which includes the detailed annexure/ notes to be discussed to enable the Board to take an informed decision. The Board met four times during the year, the details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and the Listing Regulations.


The Board of Directors has the following Committees:

1. Audit Committee

2. Nomination and Remuneration Committee (NRC)

3. Stakeholders Relationship Committee

4. Corporate Social Responsibility Committee (CSR)

5. Finance Committee

The details of the Committees along with the composition, number of meetings and attendance at the meetings are provided in the Corporate Governance Report.


The Company had come out with an IPO and was listed in May 201 6,wherein the Company had raised Rs, 3000 million. As per the terms set out in the prospectus filed with the Registrar of Companies, Pune, the Company proposed to utilize the net proceeds to meet (i) the capital expenditure requirement in relation to expansion and modernization of existing manufacturing facilities of the Company at Manchar and Palamaner and improving the marketing/distribution infrastructure for both Manchar and Palamaner plant, (ii) to invest in the wholly owned Subsidiary of the Company Bhagyalaxmi Dairy Farms Pvt. Ltd, for financing the capital expenditure requirements in relation to the expansion and modernization of the Bhagyalaxmi Dairy Farms

(iii) to make partial repayment of the Working Capital Consortium Loan of Rs, 1000 Million, which has been repaid as on March 31, 2017 and (iv) for General corporate purposes.

Please refer note 44 to the notes to accounts to financial statements as annexed to the report for details in relation to utilisation of IPO proceeds.

The unutilized amount of the issue as at March 31, 2017 has been temporarily been deployed in fixed deposits with banks.


The Sales Tax Authorities had pursuant to section 64 of MVAT Act, conducted an investigation at the offices of M/s. Parag Milk Foods Limited ("the Company") at the Registered office at Pune, Company's Plant at Manchar and the Corporate Office at Nariman Point. The Sales Tax Authorities have conducted inspection starting from financial year 2012-2013 and identified some transactions in relation to the consignment agent which were made by the Company for interstate transfer of goods and suggested the Company to reclassify the said transactions of goods under local sales.

The Company has provided the fullest co-operation to the Department to complete the enquiry and provided the information sought by them. The Company had filed revised returns and agreed to pay the additional tax liability on reclassification as suggested by the authorities. There was no implication on the continued operations of the Company as a result of this visit.

There are no significant and material orders passed by the Regulators/ Courts that would impact the going concern status of the Company and its future operations.


The extract of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is furnished in Annexure-V and is attached to this Report.


The particulars of Investments, Loans, Guarantees covered under the Provision Section 186 of the Companies Act, 2013 read with rules made there under are given in the Note No. 14, 20 and 31 of Standalone Financial Statements..


The Company is committed to good corporate governance and has consistently maintained its organizational culture as a remarkable confluence of high standards of professionalism and building shareholder equity with principles of fairness, integrity and ethics.

The Board of Directors of the Company have from time to time framed and approved various Policies as required by the Companies Act, 2013 read with the Rules issued there under and the Listing Regulations. These Policies and Codes are reviewed by the Board and are updated, if required. Some of the key policies adopted by the Company are as follows:

Sr. No


1. Policy on Determination of materiality of events/ information


Code of Conduct for Board Members and Senior Management Personnel


Policy on Preservation and Archival of Documents


Prevention of Insider Trading Policy


Whistle Blower Policy


Policy on Related Party Transactions


Policy on Materiality of Subsidiaries


Policy on Nomination & Remuneration


Policy on Board Diversity


Policy on Familiarization Programme of Independent Directors

11. Corporate Social Responsibility Policy


Policy on Prevention of Sexual harassment policy

The above mentioned policies are also available on the website of the Company


All transactions entered with Related Parties for the year under review were on arm's length basis and in the ordinary course of business and that the provisions of Section 188 of the Companies Act, 2013 and the Rules made there under are not attracted. Thus, disclosure in form AOC-2 in terms of Section 134 of the Companies Act, 2013 is not required. Further, there are no material related party transactions during the year under review with the Promoters, Directors or Key Managerial Personnel. The Company has proper systems for the purpose of identification and monitoring of such Related Party Transactions.

All Related Party Transactions are placed before the Audit Committee as also to the Board for approval. Omnibus approval was obtained on a yearly basis for transactions which are of repetitive nature. Transactions entered into pursuant to omnibus approval are placed before the Audit Committee and the Board for review and approval on a quarterly basis.

The policy on Related Party Transactions as approved by the Board of Directors has been uploaded on the website of the Company viz


Parag Milk Foods has been leveraging the Information Technology and IT enabled services for business process automation and transformation across various functions, internal and external stakeholders. Modern Technology is used at every stage to give advantage to Business by process of exchange of information in a faster and safer way.

Information Technology is used for collection the Milk even at Remote village level and data is updated on Real Time basis to Central System which is used for planning purpose. Production is managed through Programmable Logic controllers which are used to control and Monitor the process flow, giving the correct information of right mix helping in maintaining quality of the products.

Enterprise Resource Planning System is used to control and monitor all the Business transactions. Sales Force Automation and Distributor Management System are also used to manage the Sales Force and provide better visibility of the Market to Management.

Parag Milk Foods Limited is Progressing in a planned manner to promote more usage of system and automating the processes and thus processing towards paperless movement and enabling Greener Future.


Your company always believed in and worked towards "inclusive growth'- improving the quality of life of the people we touch and in the communities where we operate. The CSR committee was constituted by the Board of Directors of the Company at its meeting held on June 23, 2014 and re-constituted on May 26, 2015, July 28, 201 5 and November 09, 201 7.

The CSR Committee of the Board of Directors of the Company Consists of 3 Members viz.

1. Mr. B.M. Vyas- Non-Executive Director - Chairman

2. Mr Devendra Shah-Executive Chairman - Member,

3. Ms. Radhika Pereira-Independent Director - Member,

4. Mr. Narendra Ambani - Independent Director - Member, was appointed in Board Meeting held on November 09, 201 7.

The following CSR Activities have been conducted during: 2016-17.

(Rs, In Million)


A brief outline of the Company's CSR Policy including overview of Projects or programs proposed to be undertaken and a reference to the web-link to the CSR Policy and projects or programs and the Composition of CSR Committee.

CSR Policy is available for inspection by Members of the Company


Average net profit of the Company for last three financial years



Prescribed CSR expenditure (two percent of the amount mentioned in item 2 above)



Details of CSR spent during the financial year.



Total amount to be spent for the financial year





CSR Projected or Activity Identified

Sector in which the projects is covered

Project of Program

Amount outlay (Budget) project or wise (Rs, In Mn)

Amount spent on the projects of programs (Rs, In Mn)

Cumulative Expenditure up to the Reporting period i.e. FY 16-17 (Rs, In Mn)

Amount spend direct or through implementing agency


Designing & construction of toilets, women rehabilitation & empowerment, adding Advasi, children, students, weaker section, senior citizen providing medical & educational help, sanitation, health program,community development etc

Health Care, education., empowerment of women






Gurukrupa Vikas Sanstha a nonprofit voluntary organisation


Medical camp organized at Manchar

Health Care






The Management Discussion and Analysis Report on the operations of the Company, as required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is provided in a separate section and forms an integral part of this Report.


As per Regulation 34 (3) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section on corporate governance practices followed by the Company, together with a certificate from the Practicing Company Secretary confirming compliance forms an integral part of this Report


The information required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014, is annexed herewith as Annexure III.


During the year under review, the Company has not accepted any deposit within the meaning of Sections 73 and 74 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014 (including any statutory modification(s) or re-enactment(s) thereof for the time being in force); The Company has neither accepted nor renewed any deposits during the year ended March 31, 2017.


The Company has not bought back any of its securities during the year ended March 31, 2017.


Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (including any statutory modification(s) amendment(s) / re-enactment thereof, for the time being in force) is furnished in an Annexure IV which forms part of this Report.

Particulars of employee's remuneration, as required under section 197(12) of the Companies Act, 2013, read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2016, are not attached with this report since there was no employee who was in receipt of remuneration in excess of aggregate of ' 12 million during the year if employed throughout the financial year of ' 0.85 million per month in the aggregate if employed for part of the year.

No commission was paid during the year to the Managing Director/Whole Time Director from the Company or from its subsidiary company.

Indian Accounting Standards (Ind AS)

The Company has adopted Indian Accounting Standards (Ind AS) with effect from 1st April, 2017 pursuant to Ministry of Corporate affairs notification of the Companies (Indian Accounting Standards) Rules , 2015.


There are no qualifications, reservations or adverse remarks made by the Auditors in their report.


The Statutory Auditor, M/s Haribhakti & Co, LLP, Chartered Accountants, Pune (Firm Registration No. 103523W / W100048) who hold office till the conclusion of the ensuing Annual General Meeting and on recommendation of the Audit Committee and Board are recommended for re-appointment to hold office from the conclusion of this Annual General Meeting until the conclusion of Annual General Meeting of the Company for FY 2019-2020, subject to ratification by members at every Annual General Meeting. The Company has received under Section 139(1) of the Companies Act, 2013 and the Rules framed hereunder, a certificate of their eligibility and consent for re-appointment.


M/s Harshad Deshpande & Associates, Cost Accountants were appointed as the cost auditors of the Company for the year ended March 31, 2016. On recommendation of the Audit Committee the Board of Directors propose the appointment of M/s. Harshad Deshpande & Associate, Cost Accountant as the Cost Auditors of the Company for the Financial Year 201 7 -2018. The Cost Auditors have confirmed that they are not disqualified for such re-appointment within the meaning of Section 148 of the Companies Act 2013.


In terms of Section 204 of the Companies Act, 2013, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. N.L. Bhatia & Associates, a firm of Company Secretaries in Practice as the Secretarial Auditor to undertake the secretarial audit, for the financial year 2017-18.

The Secretarial Audit Report for the financial year ended March 31, 2017 is set out in the Annexure VI to this report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

None of the Auditors of the Company have reported any fraud as specified under the second proviso of Section 143 (12) of the Companies Act, 2013 (including any statutory modification(s) or re-enactment(s) thereof for the time being in force).


The Company has in place an Anti Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.


Your Company and its Board of Directors would like to express their sincere appreciation for the assistance, support and cooperation received from Government, regulatory authorities, stakeholders, vendors, financial institutions, banks, investors, customers, service providers and members during the year. Your Company takes pride in its highly motivated employees, workers, staff and wishes to place on record its deep sense of appreciation for their committed services and best contribution towards growth and success of your Company,





Place: Mumbai

Date: May 29, 201 7