201420142014201420142014
(Formerly Known as : Kwality Dairy (India) Ltd.)
PERFORMANCE ACCELERATED.
TRUST & QUALITY DELIVERED
KWALITY LIMITED
In this annual report, we have disclosed forward looking information, to enable investors, to
comprehend our prospects and take informed investment decisions. This report and other
statements - both written and oral that we periodically make, may contain forward looking
statements that set out anticipated result based on the managements plans and
assumptions.
We cannot guarantee that these forward looking statements will be realized. Although we
believe we have been prudent in our assumptions, the achievements of results are subject to
risk, uncertainties and even inaccurate assumption. We undertake no obligation to publicly
update any forward looking statements, whether as a result of new information, future
events or otherwise.
DISCLAIMER
CORPORATE OVERVIEW & STATUTORY REPORTS
Letter from CMD
Corporate Identity
Corporate Information
Key Trends (FY 2010-2014)
Plant & Operation
Wholly Owned Subsidiary Company
Product Portfolio
New Launches
Dealers & Distributor's Meet
Marketing Initiatives
Notice
Director Reports
Annexure to The Directors' Report
Report on Corporate Governance
Auditor's Report & Balance Sheet (Standalone)
Auditor's Report & Balance Sheet (consolidated)
Statement pursuant to Section 212(8) of the Companies Act,
1956 relating to Subsidiary Company. TA
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Letter from CMDDear Shareholders,
It gives me tremendous pleasure to write to you at the end of another successful year for Kwality Limited. Its the matter
of great pride to be associated with such sector where we are directly providing livelihoods to millions of small farmers.
Due to the continuous efforts of these farmers, India became the largest milk producing country in the world. Milk has
become the second largest agricultural commodity produced in our country next only to rice and its being a matter of
pride to be part of it. Over the last five years, Indias milk production has increased by about 25 million tonnes as
compared to an increase of about 6.6million tonnes in US and other countries.
To take the benefits, your company has also increased focus on procurement and processing capabilities which is
reflected in our growth. It has recorded a net profit of 126.63 Crore as against 96.53crores in Financial Year 2012-
2013. It has also enhanced the procurement /distribution network to ensure the widespread availability of products
across the country and to meet the increasing demands for milk and its products. It continue to invest strongly behind
the procurement, processing, brands and value chain.
The demand for milk and its products is increasing worldwide. As we know 7% of total milk production is traded in the
world. However, our country is not a major player in the international market. The future outlook for export of Indian
Dairy Products is rather positive as indigenous milk products are becoming popular with ethnic population spread all
over the world and there is a strong likelihood that the export demand for these products will grow. Your Company
continues to identify attractive and significant growth opportunities both in India and around the world and have huge
potentials to expand its business in the global market and to capture the overseas market and during the year revenue
from export of products of the Company is Rs. 183.45 Crores. We export to more than 28 countries at present and plan
to tap more international markets.
Your Company has to-date taken conscious steps towards raising the quality & hygiene of raw milk obtained and also to
improve the health and life style of the farmer community. Your Company besides its commercial operations is also
committed to the upliftment of the rural community of milk producers. Some of the activities that have built faith of the
farmers in the Company includes: productivity enhancement programme, clean milk production campaign , dairy
animal health management, financial inclusion initiative, Go Green initiative and capacity building programme. Our
reach was expanded to 4000 villages situated across the states of Rajasthan, Haryana, Punjab and Uttar Pradesh.
With the support of our team, State Bank of India and Punjab National Bank have sanctioned the loan of Rs. 50 lacs to
each purchase of 50 dairy animals. The Loan sanctioned is interest free and repayment period is of 5 years.
We are grateful to Central and State Governments and Financial Institutions, Consumers, business partners, Vendors,
Farmers, Society at and to specially shareholders of the Company for their trust and support. It is the support of
stakeholders that has helped the Company to become leader in the dairy industry in India.
Sanjay Dhingra
Chairman & Managing Director
To become the fastest growing
profitable Dairy Company
while maintaining
the highest standards of
quality & ethics.
MISVISSION
Board of Directors
Mr. Sanjay Dhingra (Chairman & Managing
Director)
Mr. Sidhant Gupta (Executive Director)
Dr. Rattan Sagar Khanna (Independent Non
Executive Director)
Mr. Arun Srivastava (Independent Non
Executive Director)
Company Secretary
Ms. Deepa Kapoor
Statutory Auditors
M/s. P.P. Mukherjee and Associates
Secretarial Auditors
M/s Mukun Vivek & Co.
Internal Auditor
M/s Mohan Gupta & Company
Registered & Corporate Office
KDIL House, F-82,
Shivaji Place, Rajouri Garden,
New Delhi 110027
CIN : L74899DL1992PLC255519
Registrars & Transfer Agents
Beetal Financial & Computer Services (P) Ltd.
Beetal House, 3rd Floor, 99 Madangir,
Behind Local Shopping Centre,
Near Data Harsukhdas Mandir, New Delhi-
110062
Plant Locations:
Village Softa, Palwal, Haryana
Bakra Mandi, Ajmer, Rajasthan.
Village: Kumarherha, NH-73, Sharanpur, UP
Village: Mumrejpur, Dibai, Bulandsahar, UP
Listing Detail
Bombay Stock Exchange Limited
National Stock Exchange of India Limited
Depositories Detail
National Securities Depositary Limited
Central Depositary Securities (India) Limited
Bankers
Andhra Bank
Allahabad Bank
Bank of Baroda
Bank of India
IDBI Bank Ltd.
Syndicate Bank
Canara Bank
Corporation Bank
Central Bank of India
Dhanlaxmi Bank Ltd.
CORPORATE INFORMATION
KEY TRENDS(FY 20102014)
INR in Crores
* Equity Shares of Face value of INR 1/- each*
** Equity Shares of Face value of INR 10/- each
Revenue Net ProfitEBITDA EPS( )
2014
2013
2012
2011
2010
4578.04
3692.29
2394.63
1608.04
1054.12
126.63
96.53
90.99
45.94
17.95
214.04
165.26
99.73
50.23
6.23*
4.75*
4.48*
2.26*
0.99*
276.03
PLA
NT &
OP
ER
ATIO
NS
WHOLLY OWNED SUBSIDIARY COMPANY IN DUBAI
To increase its international presence and cater to the new markets, Kwality Limited has established its wholly-owned
subsidiary, Kwality Dairy Products FZE in free trade zone of UAE. The subsidiary is mainly involved in the trading of
various milk products and imports skimmed and whole milk powder and various derivatives of milk, ghee, butter & other
dairy products. The products are sold both domestically and export to other countries.
The Revenue from sale as on 31.03.2014 is 278,168,956 AED as compared to 165,717,194 AED in the previous year.
Profit After Tax (PAT) for financial year stood at 11,011,346 AED as against 6,204,305 AED in the previous year.
DELIVERING ON OUR PROMISE OF
ONE STOP SOLUTION FOR DAIRY PRODUCTS
OUR PRODUCT PORTFOLIO
MILK IN POUCHES
Dairy Best Nutrified Milk is enriched with more vital minerals and vitamins. Compared to normal milk, Dairy Best Nutrified
Milk has more Calcium and Vitamins A & D. It also contains Vitamin B2 for releasing the body's energy and Vitamin B12 for
blood formation and healthy growth. It thus promises stronger bone development in the formative years, better muscle
strength and a tougher immune system, in short a strong foundation for life, for your child.
Dairy Best Nutrified Milk is available in 3 variants:
Dairy Best Full Cream Milk (Both in 1 ltr & Half ltr)
Dairy Best Toned Milk (Both in 1 ltr & Half ltr)
Dairy Best Double Toned Milk (Half ltr)
CURD
We launched our variety of Curd to give customers greater choice. As curd is a staple and popular food of every Indian
household, we are capturing the imagination of consumers with our 100% pure and high quality pasteurized toned cow's
milk. It has all the goodness of natural calcium, is thick, consistent, delicious and easy to digest.
Available in different packaging like:
Matka - 1 kg, 2kg, 5kg & 15kg
Pouch - 500gm, 1kg
Cup - 80gm, 200gm & 400gm
DAIRY BEST TETRA PACK MILK
We've taken the tetra pack route to give our customers more choice and convenience. This Grade A fluid requires no refrigeration until the
package is opened thanks to ultra pasteurization and the special shelf safe carton. The milk is enriched with Vitamin B2 that releases the
bodys energy and Vitamin B12 for blood formation and healthy growth.
Dairy Best Tetra Pack Milk contains:
Vitamin B2 and Vitamin 12 1.5 times more Calcium 2 times more Vitamin A 2.5 times more Vitamin D
The milk therefore promises stronger bone development in the formative years, better muscle strength and a tougher immune system, in
short a strong foundation for life, for your child.
Dairy Best Tetra Pack is available in 4 variants:
Dairy Best Skimmed Milk Dairy Best Standarised Milk Dairy Best Toned Milk Dairy Best Double Toned Milk
DAIRY BEST CHAACH
We had entered the fray in this product segment with our own version of Chaach. Available in salted & masala flavours, our healthy and
refreshing drink is the perfect thirst quencher for all ages. It ranks high on the health meter as it contains live probiotic bacteria which
helps in digestion and improves immunity. It is manufactured using natural ingredients and a special culture that gives it a smooth, mildly
acidic taste. The product is available widely all across India in various size packs.
Available in: 500 ml Salted Chaach Pack Size
200 ml Masala Chaach Pack Size
SWEET LASSI
Lassi, the refreshing and healthy milk based natural drink now gets a delicious twist from Dairy Best. We have introduced a range of
mouthwatering flavours to enrich this traditional drink. So what you now get is the goodness of nature blended with a refreshingly
exquisite taste. This new product is available in various package sizes, one can therefore enjoy it directly on the move (small pack) or at
home, parties, picnics etc. (family pack). So be it summer or winter, India can now enjoy its favourite drink in the flavour of one's choice.
Available in: 200 ml Pack Size
LOW CHOLESTEROL GHEE - LIVLITE
In its endeavor to produce nutritious and innovative products, Kwality Limited launched India's first Low
Cholesterol Pure Ghee, Dairy Best Livlite.
The first-of-its-kind, Livlite has been developed and patented by National Dairy Research Institute
(NDRI) Karnal, of ICAR and licensed by National Research and Development Corporation (NRDC), which
is a Government of India body. It is the only pure ghee available with 85% Less Cholesterol. A product of
many years of research, Livlite keeps the traditional form, color, aroma, consistency, texture and flavor
of ghee intact and has a shelf life of twelve months.
Available in:
RT Packs - 194 ml, 400 ml, 800 ml & 970 ml pack
Tin- 400ml, 800ml & 1ltr
PURE GHEE
Dairy Best Desi Ghee is produced from directly supplied fresh milk of the highest quality. The ghee is
manufactured under the most hygienic conditions, using the most modern equipment and is completely
untouched by hand. The combined factors ensure that it is tasty, has a traditional granular texture and
gives off a rich and mouth-watering aroma, and is healthy too. It contains plenty of antioxidants, easily
absorbs vitamins and minerals from other foods and helps strengthen the body's immune system, and
has high concentrations of butyric acid that inhibits the growth of cancerous tumours. Our Pure Ghee
has been awarded the AGMARK certification by the Ministry of Agriculture, Government of India.
Available in:
RT - 194ml, 400ml, 485 ml, 800ml & 970 ml,
Poly Pack - 480 ml, 970 ml, 1.940 ltr, and 4.850 ltr
Tin containers 400 ml, 485 ml, 800 ml, 975 ml, 1.94 ltr, 4.85 ltr & 15 kg
Jars - 194 ml, 480 ml, 970 ml, 1.940 ltr. and 4.850 ltr
100% PURE COW GHEE
Kwality's 100% Pure Cow Ghee is another high value product manufactured exclusively from fresh cow's
milk. Such is its quality that it has come to set the standard in the perceptive and ghee appreciating
hinterland of Delhi, Punjab, Rajasthan and Haryana.
The 100% Pure Cow Ghee is totally automated and machine manufactured. It is untouched by human
hand and thus is hygienic. Its pale perfect yellow has a pleasant look and gives off a rich appetizing
aroma. The texture of the ghee is granular in the manner of traditional home-made ghee. This is highly
appreciated by our customers.
Available in:
RT - 194ml, 400ml, 485 ml, 800ml & 970 ml,
Poly Pack - 480 ml, 970 ml, 1.940 ltr, and 4.850 ltr
Tin containers 400 ml, 485 ml, 800 ml, 975 ml, 1.94 ltr, 4.85 ltr & 15 kg
Jars - 194 ml, 480 ml, 970 ml, 1.940 ltr. and 4.850 ltr
SKIMMED MILK POWDER
Skimmed Milk Powder is made from fresh milk and is completely free from artificial flavors and colors. It
can be used for making milk, tea, coffee, curd, lassi, mishti doi, milk shake, ice cream, pudding and
sweets. It has less than 1.5 % fat content and has no added colours.
Available in:
500 gm and 1 kg laminated pack
WAKE UP - INSTANT DAIRY CREMER
Contains milk solids, milk fat sucrose, and emulsifiers.
It is appropriate for making milk, tea, coffee, curd, lassi, mishthi doi, milk shake, ice cream, pudding and
sweets.
It is granular, free flowing, lump free and is white in color.
Available in:
5 gm - specially designed for railways, flight catering, and hotels etc.
25 and 50 gm - pouch pack
200 gm and 500 gm - poly jar
1kg laminated pouch
PANEER
This traditional milk product is an absolute favourite in households all over the country and consumed in
different forms, raw or cooked. In line with our commitment to quality, we have ensured that the paneer
we produce is totally pure and the softest our customers have ever tasted. Paneer is known to be a very
valuable source of protein and we ensure that our product maintains all the healthy nutrients and
conforms to the strictest testing and quality standards.
Available in:
Masala variety
and in 200gm packs. 400gm, 1kg & 5kg Brick to be launched.
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A Mega Credit Camp was organised at MCC Durgapur (Sultanpur) on July 21, 2014 by Baroda Uttar Pradesh
Grameen Bank in collaboration with Kwality Limited and NABARD to promote self-employment through dairying
in the region in which total 453 milk producers participated. A loan of Rs. 53.26 Crores was approved for 3530
beneficiaries during the camp. A credit of Rs.30.43 Crores was disbursed, out of which Rs. 67 Lakhs was
disbursed to 67 milk producer members associated with Kwality Limited. Remaining portion of the loan was
disbursed for other agriculture allied activities and SHGs promoted by NABARD.
Shri K.R.Kanojia, Chairman, Baroda Uttar Pradesh Grameen Bank in his keynote address, emphasized on the
role of dairying as a sustainable source of livelihood in the rural areas and asked the farmers to avail dairy related
schemes run by the Govt. /NABARD etc. and pave the way for development of the region. He also appreciated the
efforts of Kwality Limited in ensuring better price realization of milk and establishing a fair and transparent milk
procurement system at the village level.
Dr. R.S.Khanna, Director, Kwality Limited chaired the programme. In his remarks, he reiterated the companys
commitment towards betterment of the milk producers of the region. Kwality Limited envisages to establish 1
more milk chilling centre (MCC) and reaching out to 20,000 families in 500 villages during the current financial
year. He also spoke about the various initiatives of the company like human health camps, farmer insurance,
animal health camps, animal insurance, SHG formation, supply of cattle feed & medicines etc.
The programme ended with vote of thanks from Shri O.P.Tiwari, Deputy Regional Manager, Baroda Uttar Pradesh
Grameen Bank. Shri Rajendra Singh, Shri Rajeev Agrawal, Shri B.K.Sinha, Shri Alok Singh, Smt. Pushplata
Tripathi were present in the programme.
Pro
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Notice is hereby given that the Twenty Second Annual General Meeting of the
Members of KWALITY LIMITED will be held on Wednesday, the 24th day of September,
2014 at 9.30 A.M. at Lavanya, G.T. Karnal Road, Palla Bakhtavarpur Mord, Alipur, New
Delhi - 110036, to transact the following business: -
ORDINARY BUSINESS:
1. To receive, consider and adopt the Audited Balance Sheet as at 31st March, 2014 and Profit & Loss Account and cash flow
statement for the year ended on that date, together with the reports of the Directors and Auditors thereon.
2. To declare dividend for the financial year 2013-14.
3. To appoint a Director in place of Mr. Sanjay Dhingra (DIN: 00025376), who retires by rotation and being eligible, offers himself for
re-appointment (subject to the alteration of Article of Association).
4. To consider and if thought fit, to pass the following resolution with or without modification(s) as an Ordinary Resolution:
RESOLVED THAT pursuant to the provisions of Section 139 of the Companies Act, 2013 (Act), and other applicable provisions of the
Act, if any and the rules made there under, as amended from time to time, and subject to the approval of shareholders, M/s. P.P.
Mukerjee & Associates, Chartered Accountants (ICAI Firm Registration No. 023276N), retiring Auditors of the company be and is hereby
re-appointed as Statutory Auditors of the Company, to hold the office from the conclusion of this Annual General Meeting till the
conclusion of the Annual General Meeting of the Company to be held in the year 2019 (subject to ratification of their appointment at
every AGM) at such remuneration as may be mutually agreed between the Board of Directors of the Company and the Auditors.
SPECIAL BUSINESS
5. ALTERATION OF ARTICLE OF ASSOCIATION
To consider and if thought fit, to pass the following resolution with or without modification(s) as Special Resolution:
RESOLVED THAT Pursuant to Section 14 and other applicable provisions, if any, of the Companies Act, 2013 and the rules made
thereunder, the Article of Association of the Company be and is hereby altered by substitution of regulation 104 and 127 of the Article of
Association of the Company with the following new regulation:
104. At each Annual General Meeting of the Company one third of such of the Directors for the time being as are liable to retire by
rotation or if their number is not three or a multiple of three, then the number nearest to one third shall retire from office.
127 (i) Directors liable to retire by rotation shall be determined on the basis of seniority i.e. those who have been longest in office
since their last appointment and in case of Directors appointed on same day, those who are to retire shall, in default of and subject to
any agreement among themselves, be determined by lot.
127 (ii) Subject to the provisions of Section 203 of the Companies Act, 2013 and the rules made thereunder an individual may be
appointed as the Chairperson as well as the Managing Director or Chief Executive Officer of the Company at the same time.
RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorized to file the necessary e-forms with the
Registrar of Companies, Delhi & Haryana in relation to the aforesaid amendment to the Articles of Association and further to do all such
acts, deeds, matters and things as may be deemed necessary to give effect to the above resolution.
6. APPOINTMENT OF MR. ARUN SRIVASTAVA AS AN INDEPENDENT DIRECTOR
To consider and if thought fit, to pass the following resolution with or without modification(s) as an Ordinary Resolution:
RESOLVED THAT pursuant to the provisions of Sections 149, 152 and other applicable provisions, if any, of the Companies Act, 2013
(Act) and the Companies (Appointment and Qualifications of Directors) Rules 2014, read with Schedule IV to the Act, Mr. Arun
Srivastava (DIN: 01121929), who has submitted a declaration that he meets the criteria for independence as provided in Section
149(6) of the Act, and who is eligible for appointment, be and is hereby appointed as Non-Executive Independent Director of the
Company with effect from 12.08.2014 up to 11.08.2019.
7. APPOINTMENT OF DR. RATTAN SAGAR KHANNA AS AN INDEPENDENT DIRECTOR
To consider and if thought fit, to pass the following resolution with or without modification(s) as an Ordinary Resolution:
RESOLVED THAT pursuant to the provisions of Sections 149, 152 and other applicable provisions, if any, of the Companies Act, 2013
(Act) and the Companies (Appointment and Qualifications of Directors) Rules 2014, read with Schedule IV to the Act, Dr. Rattan Sagar
Khanna (DIN: 03073914), who has submitted a declaration that he meets the criteria for independence as provided in Section 149(6)
of the Act, and who is eligible for appointment, be and is hereby appointed as Non-Executive Independent Director of the Company with
effect from 12.08.2014 up to 11.08.2019.
8. AUTHORISATION TO BORROW MONEY UNDER SECTION 180(1)(c) OF THE COMPANIES ACT, 2013
To consider and if thought fit, to pass the following resolution with or without modification(s) as Special Resolution:
RESOLVED THAT in supersession of resolution passed earlier and subject to the provisions of Section 180(1)(c), Section 186 of the
Companies Act, 2013, and other applicable provisions of the Companies Act, 2013 ,if any, and the rules made there under and subject
NOTICE FOR TWENTY SECOND
ANNUAL GENERAL MEETING
to the provisions of the Articles of Association of the Company, consent of the members be and is hereby accorded to the Board of Directors of
the Company for and on behalf of company, severally and/or jointly to borrow any sum or sums of money, give and/or receive the corporate
guarantee, from time to time as the Board of Directors may think fit, for the purpose of business of the Company on such terms and conditions
and with or without security from financial institutions and/or Banks and/or depositors and/or other parties by way of rupee loans and/or
loans in any currency or currencies and/or deposits and/or credit facilities and/ or deferred payment facilities and/or non-fund based limit
and/or issue of debentures, as the Board of Directors may in its absolute discretion think fit, notwithstanding that the money or monies to be
borrowed together with the monies already borrowed by the Company including the corporate guarantee on behalf of the Company (apart from
the temporary loans obtained from the companys Banker in the ordinary course of business) may exceed the aggregate paid up share capital
of the company and its free reserve (i.e. reserve not set apart for any specific purpose) provided, however, that the total borrowings
outstanding at any one time including the monies already borrowed shall not exceed a sum of Rs. 3,000 Crores (Rupees Three Thousand
Crores Only).
RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorised to file the necessary e-forms with the Registrar
of Companies, Delhi & Haryana and other concerned authorities and to take all such steps and to give all such directions and to do all such
acts, deeds, matters and things as may be necessary and/or expedient to give effect of the above resolution.
9. AUTHORISATION TO ISSUE SHARES ON PREFERENTIAL BASIS
To consider and if thought fit, to pass the following resolution with or without modification(s) as Special Resolution:
RESOLVED THAT pursuant to the provisions of Section 42 and Sections 62(1)(c) and all other applicable provisions, if any, of the Companies
Act, 2013 and the rules made thereunder (including any modification(s) or re-enactment(s) thereof, for the time being in force) and other
applicable laws, rules, regulations, notifications and circulars and in accordance with the Memorandum and Articles of Association of the
Company and Listing Agreements between the Company and the Stock Exchanges where the shares of the Company are listed and subject to
such approvals, permissions and sanctions as may be necessary from the Government of India, Reserve Bank of India (RBI), Securities and
Exchange Board of India (SEBI), Registrar of Companies, NCT of Delhi & Haryana and/or any other regulatory authorities, any other
competent authorities, institutions or bodies, within or outside India and subject to such conditions, alterations and modifications as may be
prescribed by such concerned authorities while granting such approvals, permissions and sanctions, which the Board of Directors
(hereinafter referred to as the Board which term shall be deemed to include any committee(s) duly constituted/ to be constituted by the
Board to exercise its powers including the powers conferred by this resolution) is hereby authorized at its discretion to accept, consent of the
Company be and is hereby accorded to offer, issue and allot (including with provisions for reservations on firm and /or competitive basis, of
such part of issue and for such categories of person including employees of the Company as may be permitted) by way of rights issue and/or
public issue and/or offer for sale and/or private placement and/or by issuing compulsory convertible debenture (CCD)/compulsory
convertible preference shares (CCPS) and/or Qualified Institutional Placements/Institutational Placement Programmes under SEBI (Issue of
Capital and Disclosure Requirements) Regulations, 2009 and/or against subscription in foreign/ Indian Currency, through prospectus and/or
offering circular/offer letter/ term sheet, equity shares of the Company (which shall rank pari-passu to the existing equity shares of the
Company) (the shares), and/or non-convertible and partly convertible debentures, with or without warrants, and/or Global Depository
Receipts/Global Depository Shares (GDRs/GDSs) and/or American Depository Receipts/American Depository Shares (ADRs/ADSs))
against the issue of underlying shares and/or foreign currency convertible bonds (FCCBs) convertible into equity shares, which shall rank
pari passu with the then existing (hereinafter referred to as securities), whether to remain unlisted or to be listed on any stock exchanges in
India or any other international stock exchange outside India, to resident of India or persons resident outside India including Foreign
Institutional Investors/ Qualified institutional Buyers (QIBs)/ Companies/ Individuals in India or abroad, with or without an overallotment/
Green Shoe Option, as may be permitted under applicable laws, rules & regulations and policy whether or not they are members of the
Company in such form and terms, including as to pricing, the ratio in which such securities may be offered, issued and allotted to the existing
shareholders, the number of securities to be issued, face value of the securities, rate of interest, premium, number of equity shares to be
allotted on conversion, exercise of rights attached with warrants, ratio of exchange of shares and/or warrants and/or any other financial
instruments, period of conversion/redemption/fixing of record date or book closure, adjustment conditions for corporate actions and other
related or incidental matters as may be decided and deemed appropriate by the Board up to a sum of Rupees 10,000 million (inclusive of
premium as may be determined by the Board) (or an equivalent amount in any foreign currency) in one or more tranches, at such price or
prices, at a premium or discount to market price or prices and in such manner and on such terms and conditions as the Board may in its
absolute discretion think fit, in consultation with lead managers and/or underwriters and/or advisers as may be appointed by the Board,
whether with or without an option to subscribe for additional securities.
RESOLVED FURTHER THAT without prejudice to the generality of the above and subject to all applicable laws, the aforesaid issue of securities
may have all or any terms or combination of terms in accordance with Indian laws and/or international practices and regulations including, but
not limited to, conditions in relation to payment of interest, additional interest, premium on redemption, prepayment and other debt service
payments whatsoever, and all such terms are provided in issue of securities of this nature internationally and/or domestically including terms
for issue of shares upon conversion of securities or variation of conversion price of the securities during the term of securities as the Board
deems fit and appropriate and the Board is also entitled to enter into and execute all such arrangements/agreements, as the case may be,
with any lead managers, underwriters, registrar, advisors, guarantors, trustees, agents, depositories, custodians and all such agencies as may
be involved or concerned in such offering of securities and to remunerate all such agencies including the payment of commissions, brokerage,
fees or the like and also to seek the listing of such securities or securities representing the same in one or more stock exchanges within and/or
outside India.
RESOLVED FURTHER THAT the Board may enter into any agreement with any agency or body for issue and allotment of securities in such
form(s) with such features and attributes as are prevalent in domestic as well as international capital markets for instruments of that nature
and to provide for the tradability or free transferability thereof as per the domestic as well as international practices and regulations and under
the norms and practices prevalent in the international markets and the securities issued in foreign market and/or Indian markets shall be
deemed to have been made abroad and/or in the international market and/or at the place of issue of the securities in the international market
and/or Indian market and may be governed by applicable Indian laws and/or foreign laws, as the case may be.
RESOLVED FURTHER THAT in the event of issue of securities by way of a qualified institutional placement to QIBs on Private Placement basis
shall be in accordance with SEBI (Issue of Capital & Disclosure Requirement) Regulations 2009, the relevant date on the basis of which price
of the resultant shares shall be determined as specified under the SEBI (Issue of Capital & Disclosure Requirement) Regulations 2009 shall
be the date of the meeting in which the board or the committee of the directors duly authorized by the board, decide to open the proposed issue
of securities.
RESOLVED FURTHER THAT in the event the securities are proposed to be issued through FCCBs/ADRs/GDRs, the relevant date for the
purpose of pricing the securities is the date of the meeting at which the Board decides to open the proposed issue, as specified in the Issue of
Foreign Currency Convertible Bonds and Ordinary Shares (through Depositary Receipt Mechanism), Scheme 1993.
RESOLVED FURTHER THAT the Board be and is hereby authorized to finalize and approve the offering circular/ prospectus/ placement
document/ term sheets/ agreements, in respect of the proposed issue of the securities and to authorize any director or directors of the
Company or any other officer or officers of the Company to sign the above documents for and behalf of the Company together with the authority
to amend, vary or modify the same and to give such declarations, affidavits, certificates, consents as may be required from time to time, and to
arrange for the submission of the offering circular/ prospectus/ placement document/ term sheets agreements, and any amendments and
supplements thereto, with any applicable stock exchanges, government and regulatory authorities, institutions, as may be required.
RESOLVED FURTHER THAT in case securities are offered through rights issue, the shareholders shall have right to renounce all or any the
shares offered in favor of any person or persons who are Indian residents subject to the right of the Board to refuse allotment to a person, not
being a shareholder of the company without assigning any reason. The members can apply for additional shares and they may be entitled to
allotment of additional shares at the discretion of the Board and in consultation with the stock exchanges. The renouncees may also apply for
additional shares and they may be entitled to allotment of additional shares at the discretion of the Board and in consultation with the stock
exchanges.
RESOLVED FURTHER THAT in case of any over subscription of the issue, the Board be and is hereby authorized to retain such of the amount,
and issue and allot such securities as may be permitted in accordance with applicable laws, rules & provisions in consultation with concerned
authorities including stock exchanges.
RESOLVED FURTHER THAT the Board be and is hereby entitled to vary, modify, alter any of the foregoing terms and conditions at their
discretion and in conformity with those as may be approved by the SEBI, RBI or any other appropriate authority and/or department.
RESOLVED FURTHER THAT for giving effect to this resolution, the Board be and is hereby authorized to do all such acts, deeds and things as
the Board may at its absolute discretion, consider necessary, usual and expedient, including without limitation the utilization of issue
proceeds, entering into of underwriting, memorandum of understanding, marketing and depository arrangements, and with power on behalf
of the Company to settle any question, remove any difficulty or doubt that may arise from time to time in relation to the offer, issue, allotment
and utilization of the issue proceeds of the securities for the Companys projects/ expansions/ modernizations/ acquisitions/ direct
investments in the subsidiary companies/ joint ventures/ repayment of debts/ other corporate needs, as they may deem fit.
RESOLVED FURTHER THAT for the purpose of giving effect to this resolution, the Board/ committee be and is hereby authorized to do all such
acts, deeds and things as the Board may at its absolute discretion deem necessary, proper or desirable and to settle any question, difficulty or
doubt that may arise with regard to the offer/ issue, allotment and utilization of the issue proceeds including but without limitation to the
making of listing applications, creation of such mortgage/ charge, if necessary, under applicable provisions of the Companies Act, 2013, in
respect of the aforesaid securities either on pari-passu basis or otherwise, giving or authorizing the giving by concerned persons of such
declarations, affidavits, certificates, consents and authorities as may be required from time to time, without being required to seek any further
consent or approval of the members and the members shall be deemed to have given their approval thereto expressly by the authority of this
resolution.
RESOLVED FURTHER THAT in case of any debt instrument including but without limitation to any debentures, bonds, the members shall be
deemed to have given their approval expressly by the authority of this resolution.
RESOLVED FURTHER THAT the Board, be and is hereby authorized to delegate all the above powers and authorities to any person or persons
or committee of the Board, in connection with the issue of securities, and to give effect to the above resolutions.
By Order of the Board
Sd/
Place: New Delhi (Deepa Kapoor)
Date: August 12, 2014 (Company Secretary & Compliance Officer)
1. A MEMBER OF THE COMPANY ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND AND
VOTE INSTEAD OF HIMSELF AND THE PROXY NEED NOT BE A MEMBER OF THE COMPANY. PROXIES, IN ORDER TO BE EFFECTIVE MUST
BE RECEIVED, DULY FILLED AND AUTHENTICATED AT REGISTERED OFFICE OF THE COMPANY NOT LESS THAN 48 HOURS (FORTY-EIGHT
HOURS) BEFORE THE SCHEDULED TIME OF THE MEETING.
2. The relevant Explanatory Statement pursuant to Section 102 (1) of the Companies Act, 2013 setting out material facts relating to the
business at item no. 5 to item no. 9 of the Notice as set out above, is annexed hereto.
3. Member/Proxies should bring the Attendance Slip in the Meeting duly filed in, for attending the meeting.
4. Statutory Registers under the Companies Act, 2013 is available for the inspection at the registered Office of the Company during business
hours.
5. Corporate Members are requested to send a duly certified copy of the Board Resolution, pursuant to Section 113 of the Companies Act,
2013, authorizing their representative to attend and vote at the Annual General Meeting.
6. Members are requested to bring their admission slips along with copy of the report & accounts to the Annual General Meeting.
7. Members who wish to obtain information on the Company or view the accounts for the financial year ended 31st March, 2014, may visit the
Companys website www.kdil.in.
8. The dividend as recommended by the Board of Directors, if declared at this Annual General Meeting, will be paid within 30 days after the
date of declaration:
To those shareholders whose names appear on the Companys Register of Members after giving effect to all valid share transfers in
physical form lodged with the Registrar and Transfer Agents (R&T Agents) of the Company on or before Tuesday, 16th September 2014.
In respect of shares held in electronic form (demat mode), dividend will be paid to those deemed members whose names appear in
the statements of beneficial ownership furnished by National Securities Depository Limited (NSDL) and Central Depository Services (India)
Limited (CDSL) as at the close of business hours on Tuesday, 16th September 2014.
Physical shares Payment of dividend through NECS: Members holding shares in physical form are advised to submit particulars of
their bank account, viz. name and address of the branch of the bank, MICR Code of the branch, type of account and account number at the
earliest to our Registrar and Share Transfer Agent, M/s Beetal Financial & Computer Services Private Limited.
9. This may be taken as notice of declaration of dividend for the financial year 2013-14 in accordance with Article 138 of the Article of
Association of the Company in respect of dividend for that year when declared.
10. The Registered of Members and Transfer Books of the Company will remain closed from 17th September, 2014 to 24th September, 2014
(both days inclusive) for the purpose of ascertaining eligibility to dividend, if declared.
11. Members are requested to intimate the Registrar and Share Transfer Agent of the Company - M/s Beetal Financial & Computer Services
Private Limited, 99, Beetal House, Madangir, New Delhi 110062, immediately of any change in their address in respect of equity shares held
in physical mode and to their DPs in respect of equity shares in dematerialized form.
12. Members may avail nomination facility as provided under Section 72 of the Companies Act, 2013.
13. Members who hold shares in electronic form are requested to write their Client ID and DP ID numbers and those who hold shares in
physical form are requested to write their Folio number in the attendance slip for attending the meeting to facilitate identification of
membership at the meeting.
14. Across the world, there is an increasing focus on doing our share to help save our environment from further degradation. Recognizing this
trend, the Ministry of corporate Affairs (vide circular nos. 17/2011 dated 21.04.2011 and 18/2011 dated 29.04.2011 respectively), has
undertaken a Green Initiative in Corporate Governance and allowed Companies to share documents/notices (including notice calling Annual
General Meeting, Audited Financial Statements, Directors Report, Auditors Report, etc) with its shareholders through an electronic mode.
The move of the Ministry allows public at large to contribute to the green movement.
To support this green initiative of the Government in full measure, shareholders who have not registered their e-mail addresses so far are
requested to register their e-mail addresses. Shareholders holding shares in physical form can avail the said facility by filling in the E-
Communication Registration Form available on Companys website (www.kdil.in) or as attached to this Annual Report and forward the same to
Companys Registrar i.e. Beetal Financial & Computer Services Private Limited. Shareholders holding shares in electronic form can also avail
said facility by registering/changing the E-mail address with the Depository through their concerned Depository Participants (DP) or by filling in
the E-Communication Registration Form as attached to this Annual Report and forward the same to the Companys Registrar i.e. Beetal
Financial & Computer Services Private Limited.
15. The Company hereby gives an opportunity to all the members, who have not get their e-mail id recorded, to get it registered to avail the
facility to receive any communication through electronic mode.
16. Members are hereby informed that Dividend which remains unclaimed / un-encashed over a period of seven years, has to be transferred
as per the provisions of Section 124 of the Companies Act, 2013 by the Company to The Investor Education & Protection Fund constituted by
the Central Government under Section 125 of the Companies Act, 2013. It may please be noted that once unclaimed / un-encashed dividend
is transferred to Investor Education & Protection Fund as above, no claims shall lie in respect of such amount by the shareholder.
17. In compliance with the provisions of Section 108 of the Companies Act, 2013 and the Rules framed thereunder and listing agreement, the
Members are provided with the facility to cast their vote electronically, through the e-voting services provided by CDSL, on all resolutions set
forth in this Notice.
18. Detail of Directors seeking appointment/re-appointment at the forthcoming Annual General Meeting
NOTES:
Name of the Director Mr. Arun Srivastava Dr. Rattan Sagar Khanna Mr. Sanjay Dhingra
Date of Birth
Relationship with other
Directors Inter-se
None None None
03rd April, 1968 12th April, 1945 12th October, 1970
Instructions for members for voting electronically are as under:-
(A) In case of members receiving e-mail:
(i) Log on to the e-voting website www.evotingindia.com.
(ii) Click on Shareholders tab to cast your votes.
(iii) Now, select the Electronic Voting Sequence Number - EVSN along with KWALITY LIMITED from the drop down menu and click on
SUBMIT
(iv) If you are holding shares in Demat form and have already voted earlier on www.evotingindia.com for a voting of any Company, then
your existing login id and password are to be used. If you are a first time user follow the steps given below.
(v) Now, fill up the following details in the appropriate boxes:
For Members holding shares in Demat Form For Members holding shares in Physical Form
For NSDL: 8 Character DP ID followed by 8 Digits Client ID
For CDSL: 16 digits beneficiary ID
Folio Number registered with the Company
PAN*
DOB#
Dividend Bank
Details#
Enter your 10 digit alpha-numeric *PAN issued by Income Tax Department when prompted by the system while
e-voting (applicable for both demat shareholders as well as physical shareholders)
Enter the Date of Birth as recorded in your demat account or in the company records for the said demat account
or folio in dd/mm/yyyy format.
Enter the Dividend Bank Details as recorded in your demat account or in the company records for the said demat
account or folio.
Expertise in specific
functional area
Dairy, Farming and in
Agricultre Sector
Vast experience in dairy
business
Expertise in Financial
Modeling & Resource
Moblisation
Directorship held in other
Companies as on date.
NIL Kwality Dairy Investments
Pvt. Ltd.
DELTA AGROTECH
PRIVATE LIMITED
NIL
NIL
NIL
NIL
NIL
152,154,714
Chairman/Member of the
committee of the Director
of the other companies
in which he is a director
as on 31 March 2014
Number of Shares held
in the Company
Chairman/Member of the
committee of the Board
of Directors of the
Company as on
31 March 2014
Chairman of Audit
Committee
Member of Remuneration,
Compensation & Nomination
Committee
Member of Stakeholders
Relationship Committee
Member of Share
Transfer Committee
Member of Audit
Committee
Member of Remuneration,
Compensation & Nomination
Committee
Member of Stakeholders
Relationship Committee
Member of Share Transfer
Committee
Member of Corporate
Social Responsibility
Committee
Member of Remuneration,
Compensation & Nomination
Committee
Member of Management
Committee
Member of Corporate
Social Responsibility
Committee
Qualification
Date of Appointment
Graduate GraduateM.Sc. (Hons) from Punjab
Agri University, Diploma in
Semen Freezing Gynecology
& Andrology from Royal
Veterinary and Agriculture
University, Copenhagen
and Diploma in Farm &
Science Journalism form
Institute of Farm & Science
Journalism, New Delhi
25th June, 2003 18th May, 2010 18th June, 2003
*Members who have not updated their PAN with the Company/Depository Participant are requested to use the default number:
in the PAN field.
# Please enter any one of the details in order to login. In case either of the details are not recorded with the depository please enter the value
in the Dividend Bank details field.
(vi) After entering these details appropriately, click on SUBMIT tab.
(vii) Members holding shares in physical form will then reach directly the EVSN selection screen. However, members holding shares in demat
form will now reach Password Creation menu wherein they are required to mandatorily enter their login password in the new password field.
Kindly note that this password is to be also used by the demat holders for voting for resolutions of any other company on which they are eligible
to vote, provided that company opts for e-voting through CDSL platform. It is strongly recommended not to share your password with any other
person and take utmost care to keep your password confidential. Kindly note that this changed password is to be also used by the Demat
holders for voting for resolutions for the Company or any other Company on which they are eligible to vote, provided that Company opts for e-
voting through CDSL platform.
(viii) For members holding shares in physical form, the details can be used only for e-voting on the resolutions contained in this notice.
(ix) Click on the relevant EVSN on which you choose to vote.
(x) On the voting page, you will see Resolution Description and against the same the option YES/NO for voting. Select the option YES or NO as
desired. The option YES implies that you assent to the Resolution and option NO implies that you dissent to the Resolution.
(xi) Click on the Resolutions File Link if you wish to view the entire Resolutions.
(xii) After selecting the resolution you have decided to vote on, click on SUBMIT. A confirmation box will be displayed. If you wish to confirm
your vote, click on OK, else to change your vote, click on CANCEL and accordingly modify your vote.
(xiii) Once you CONFIRM your vote on the resolution, you will not be allowed to modify your vote.
(xiv) You can also take out print of the voting done by you by clicking on Click here to print option on the Voting page.
(xv) If Demat account holder has forgotten the changed password then Enter the User ID and Captcha Code click on Forgot password & enter
the details as promoted by the system.
(xvi) Institutional shareholders (i.e other than Individuals, HUF, NRI etc) are required to log on to https://www.evotingindia.co.in and register
themselves as Corporates. After receiving the login details they have to link the account(s) which they wish to vote on and then cast their vote.
They should upload a scanned copy of the Board resolution and Power of Attorney (POA) which they have missed in favour of the Custodian, if
any, in PDF format in the system for the scrutinizer to verify the same.
(B) In case of members receiving the physical copy of Notice of Annual General Meeting [for members whose e-mail IDs are not registered with
the company/depository participant(s) or requesting physical copy]:
Please follow all steps from sl. no. (i) to sl. no. (xvi) above, to cast vote.
(C) The e-voting period begins on 18.09.2014 at 10:00 AM and ends on 20.09.2014 at 6:00 PM. During this period shareholders of the
Company, holding shares either in physical form or in dematerialized form, as on the cut-off date, may cast their vote electronically. The e-voting
module shall be disabled by CDSL for voting thereafter. Once the vote on a resolution is cast by the shareholder, the shareholder shall not be
allowed to change it subsequently.
(D) In case you have any queries or issues regarding e-voting, you may refer the Frequently Asked Questions (FAQs) and e-voting manual
available at www.evotingindia.com under help section or write an email to [email protected].
19. Mr. Mukun Arora of M/s Mukun Vivek & Company, Company Secretaries, has been appointed as the Scrutinizer to scrutinize the e-voting
process in a fair and transparent manner.
20. The notice is being dispatched/emailed to all the members whose names appear on the register of members/list of beneficial owners as
received from the National Securities Depository Ltd. (NSDL)/Central Depository Services (India) Ltd. (CSDL) on 22 August 2014 and voting
rights shall be reckoned on the paid-up value of the shares registered in the name of the shareholders as on the same date.
21. The Scrutinizer shall, within a period not exceeding three working days from the conclusion of the e-voting period, unblock the votes in the
presence of at least two witnesses not in the employment of the Company and make a Scrutinizers Report of the votes cast in favour or
against, if any, forthwith to the Chairman of the Company.
22. The results declared along with the Scrutinizers Report shall be placed on the Companys website www.kdil.in within two days of the
passing of the resolutions at the Annual General Meeting of the Company and communicate to Stock Exchanges, where the shares of the
Company are listed.
EXPLANATORY STATEMENT PURSUANT TO SECTION 102(1) OF
THE COMPANIES ACT, 2013ITEM NO. 5
In terms of Section 152 of the Companies Act, 2013 atleast two third of the Directors of the Company shall be persons whose period of office is
liable to retire by rotation and out of which atleast one third shall retire at each Annual General Meeting of the Company.
Currently the Company has two Independent Directors which are not liable to retire by rotation as per Section 152 of the Companies Act, 2013
and as per Articles of Association of the Company Managing Director and Whole Time Directors are not liable to retire by rotation.
Therefore the Company in order to comply with the provisions of Section 152 and Section 203 needs to alter its Article of Association by
substitution of regulation 104 and regulation 127 in such way that the office of Managing Director and Whole Time Directors are also come
under the preview of retirement by rotation and an individual may be appointed as Chairman and Managing Director of the Company at the
same time.
Except Mr. Sanjay Dhingra, Chairman & Managing Director and Mr. Sidhant Gupta, Director of the Company, none of the Directors and Key
Managerial Personnel of the Company and their relatives is concerned or interested, in the resolution.
ITEM NO. 6-7
Pursuant to the provisions of Section 149 of the Companies Act, 2013, every listed public company is required to have at least one-third of the
total number of directors as independent directors, who are not liable to retire by rotation.
The MCA has clarified wide its General Circular No. 18/2014 dated 11.06.2014 that the Companies are required to make fresh appointment of
Independent Directors as per the provisions of Companies Act, 2013 and any tenure of an Independent Directors on the date of
commencement of the Act shall not be counted for his appointment/holding office of director under the Act. In view of the transitional period of
one year provided under Section 149(5), it is hereby clarified that it would be neccessary that if it is intended to appoint existing Independent
Directors under the new Act, such appointment shall be made expressly under section 149(10)/(11) read with Schedule IV of the Act within one
year from 1st April, 2014 subject to compliance with eligibility and other prescribed conditions.
In view of the above the Board recommended the appointment of Mr. Arun Srivastava and Dr. Rattan Sagar Khanna as Non-Executive
Independent Directors from 12.08.2014 up to 11.08.2019.
In the opinion of the Board, Mr. Arun Srivastava and Dr. Rattan Sagar Khanna fulfils the criteria as mentioned in Section 149(6) of the
Companies Act, 2013 and recommend the appointment of these as Non-Executive Independent Directors and received a declaration from
them as specified in the above mentioned Section.
In compliance with the provisions of Section 149 read with Schedule IV of the Companies Act, 2013, the appointment of these directors as
Non-Executive Independent Directors is now being placed before the Members for their approval.
The Company and Non-Executive Independent Directors shall abide by the provisions specified in Schedule IV of the Companies Act, 2013.
The terms and conditions of appointment of the above Directors shall be open for inspection by the Members at the Registered Office of the
Company during normal business hours on any working day, excluding Saturday.
Dr. Rattan Sagar Khanna
Dr. Rattan Sagar Khanna did his M.Sc. (Hons) from Punjab Agri University. He is Diploma holder in Semen Freezing Gynecology & Anthology
from Royal Veterinary and Agriculture University, Copenhagen, Diploma in Farm & Science Journalism from Institute of Farm & Science
Journalism, New Delhi. Over 35 years, he worked at senior positions in Dairy, Farming and in Agriculture Sector in the areas of manufacturing,
consulting and marketing.
He has been providing his valuable inputs on major initiatives taken by the Company as well as the technologies introduced in the Company. He
is actively involved in introduction and launch of our anchor Brand Dairy Best - Livlite. Dr. Khanna has also extended his expertise in
implementation and establishment of collection centres and MCC's of the Company.
As an investor protection activist and proponent of good corporate governance, Dr. Khanna has been the guiding force in company's CSR
initiatives. An old war horse in Dairy Business, his experience has been a valuable asset for the company.
Arun Srivastava
Shri Arun Srivastava has been serving on various committees of Board and helps the Company in its smooth operations. He brings in corporate
finance and transaction experience to the Company and with consulting and liasoning background he remains the trouble shooter for the
Company vis--vis clients and lenders and ensure smooth execution of mandated deals.
Mr. Arun Srivastava and Dr. Rattan Sagar Khanna, are concerned or interested in the Resolutions of the accompanying Notice relating to their
own appointment.
ITEM NO. 8
Upon the commencement of new Companies Act, 2013, the Ministry of Corporate Affairs (MCA) vide its general circular no. 04 /2014 dated
March 25, 2014 has clarified the resolutions passed under Section 293(1)(d) of the Companies Act, 1956 prior to commencement of Section
180 of the Companies Act, 2013 which is to be valid upto one year from the date of notification of Section 180 of the Companies Act, 2013 and
thus fresh approval of shareholders is required to be obtained at the general meeting of the shareholders.
Therefore in order to comply with the provisions of Section 180(1)(c), Section 186 and other applicable provisions of the Companies Act, 2013,
the Company needs to obtain the fresh approval of shareholders by way of Special Resolution to authorized the Board to borrow money
including the corporate guarantee on behalf of the Company upto a sum of Rs. 3000 Crores (Rupees Three Thousand Crores Only).
Further to meet the working capital demand of the growing business of the Company, the Board is also authorized to give and/or receive the
corporate guarantee on behalf of the Company under Section 186 of the Companies Act, 2013 and the rules made there under.
None of the Directors and Key Managerial Personnel of the Company and their relatives is concerned or interested, in the resolution.
ITEM NO. 9
The Company has taken up and intends to take up in future several growth initiatives like expansions, modernizations, strengthening of
procurement mechanism, establishment of milk chilling centers, overseas direct investment in subsidiary companies/joint venture etc. and
therefore, there is need to strengthen its financial position by augmenting long term resources. The Company plans to achieve this by issue of
securities in international markets and/or in domestic market.
Several modes are available for raising capital by way of Public Issue, Right Issue, Offer for Sale, Private Placement, Compulsory Convertible
Debenture(s) (CCDs)/Compulsory Convertible Preference Share(s) (CCPS), QIP, Institutional Placement Programmes under Securities and
Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, Private Placement, Global Depositary Receipt,
American Depositary Receipt, Foreign Currency Convertible Bonds or other equity related instruments in the domestic and in the international
market.
The Company consulting various investment bankers for raising capital through one or more such manner or such instruments up to a sum of
Rupee 10,000 million in one or more trenches, whether with or without an option to subscribe for additional securities.
The Company intends to use the funds so raised towards capital expenditure for strengthening of procurements mechanism, establishment of
milk chilling centers, expansions, modernization, new projects, overseas direct investment in subsidiary companies/joint ventures, any other
use which may be required in the normal business and as permitted under applicable law from time to time.
The detailed terms and conditions for the offer and the rights and privileges of the holders of equity related instruments, with or without
warrant, non-convertible/partly convertible debentures with or without warrant and/or Global Depositary Receipts/ Shares (GDRs/GDSs)
and/or American Depositary Receipts/shares (ADRs/ADSs) against the issue of underlying shares and/or Foreign Currency Convertible Bonds
(FCCBs) convertible at the option of the holders into equity shares (herein referred to as the Securities) to resident of India or persons
resident outside India including Foreign Institutional Investor, Qualified Institutional Buyers (QIB) will be determined in consultation with
investment banker, advisors and underwriters to be appointed by the Company considering the prevailing market conditions and other
relevant factors. The resolution seeks to afford discretions to the Board of Directors (including a committee thereof) to finalize these terms in
consultation with the agencies aforesaid in accordance with applicable India Laws and/or International Laws. The Securities would be issued
at a price determined in accordance with SEBI Regulations, FEMA Regulations and other applicable Laws. The conversion of any of the
securities into equity shares at a later stage, if any, shall not be less than the minimum price as calculated as per SEBI Regulations and/or any
other authority concerned.
In view of the above, consent of the shareholders is being sought, by way of a special resolution, pursuant to the provisions of Section 42,
Section 62(1)(c), and other applicable provisions, if any, of the Companies Act, 2013 and other applicable Laws, rules and regulations and in
accordance with the Memorandum and Article of Association of the Company and Listing Agreement between the Company and Stock
Exchanges where the shares of the Company are listed. The Equity Shares arising out of issue of securities pursuant to this resolution shall
rank pari - passu in all aspects with the existing Equity Shares of the Company.
In view of the reasons aforesaid, an enabling resolution is proposed for consideration of the shareholders to give adequate flexibility and
discretion to the Board to finalize the terms of the issue of Securities. The board recommends the resolution for the approval of the members of
the Company.
None of the Directors and Key Managerial Personnel of the Company and their relatives is concerned or interested, in the resolution.
By Order of the Board
Sd/
Place: New Delhi (Deepa Kapoor)
Date: August 12, 2014 (Company Secretary & Compliance Officer)
...........................................................................................................................................................................
Affix 1
Rupees
Revenue Stamp
KWALITY LIMITED
Regd. Office: KDIL House, F-82, Shivaji Place, Rajouri Garden, New Delhi- 110027
CIN : L74899DL1992PLC255519
ATTENDANCE SLIP
ANNUAL GENERAL MEETING
Wednesday, 24th September, 2014 at 9.30 a.m.
VENUE: Lavanya, G.T. Karnal Road, Palla Bakhatavarpur Mord, Alipur, Delhi-110036
DP Id:................................................................................ Folio No:.....................................................................
Client ID:........................................................................ No. of Shares held:.....................................................
Member's Name:..................................................................................................................................................
Complete Address:...............................................................................................................................................
..............................................................................................................................................................................
I hereby record my presence at the Annual General Meeting of the Company to be held on 24th September,
2014 at 9.30 a.m. at Lavanya, G.T. Karnal Road, Palla Bakhatavarpur Mord, Alipur, Delhi-110036
..................................................................
Member's Signature
If proxy attended Instead of Member:
Proxy Name:................................................................................... Proxy's Signature:........................................
Note: Members / Proxy holders wishing to attend the meeting must bring their duly filled and signed
Attendance Slip with them. NO GIFT/COUPON WILL BE DISTRIBUTED AT THE ANNUAL GENERAL MEETING.
Form No. MGT-11
PROXY FORM
[Pursuant to section 105(6) of the Companies Act, 2013 and rule 19(3) of the Companies
(Management and Administration) Rules, 2014]
CIN: L74899DL1992PLC255519
Name of Company : Kwality Limited
Registered office : KDIL House, F-82, Shivaji Place, Rajouri Garden, New Delhi-110027
Name of Member (s) : ..................................................... E-mail Id : ................................................................
Folio No/Client Id : .......................................................... DP ID : .....................................................................
Registered address : ...........................................................................................................................................
.............................................................................................................................................................................
I/We, being the member (s) of ..................... shares of above named company, hereby appoint
1. Name : ........................................................................ E-mail Id : ..............................................................
Address :
Signature : ...................................., or failing him
2. Name : ........................................................................ E-mail Id : ..............................................................
Address :
Signature : ...................................., or failing him
as my/our proxy to attend and vote (on a poll) for me/us and on my/our behalf at the 22nd Annual General Meeting of
the company, to be held on the 24th day of September, 2014 at 9:30 a.m./p.m. at Lavanya, G.T. Karnal Road, Palla
Bakhtavarpur Mord, Alipur, Delhi-110036 and at any adjournment thereof in respect of such resolutions as are
indicated below :
Resolution
No.
Resolutions Votes
For Against
1
2
Adoption of Balance Sheet and Profit & Loss Account together
with the reports of the Directors and Auditors thereon
Approval of dividend for the financial year 2013-14
3 Appoint Mr. Sanjay Dhingra, who retires by rotation and being
eligible, offers himself for re-appointment (subject to the
alteration of Article of Association).
4 Appointment of M/s. P.P. Mukerjee & Associates as Statutory
Auditor of the Company
5 Approval for alteration of article of association of the Company
6 Appoint Mr. Arun Srivastava as an independent director
7 Appoint Dr. Rattan Sagar Khanna as an independent director
9 Authorization to issue shares on preferential basis
8 Authorize the Board of Directors to borrow money under
section 180(1)(c) of the companies act, 2013
Signed this ............. day of .................. 2014
Signature of shareholder
Signature of Proxy holder(s)
Note: This form of proxy in order to be effective should be duly completed and deposited at the Registered Office of
the Company, not less than 48 hours before the commencement of the Meeting.
Affix
Revenue
Stamp
DIR
EC
TO
R'S
RE
PO
RT
Dear shareholders,
Your Directors have pleasure in presenting their Twenty Second Annual Report together with Audited Accounts of the Company for
the financial year ended 31st March 2014.
1. Financial Highlights
2. COMPANY PERFORMANCE
Your Company achieved a turnover of Rs. 4578.05 crores for the year ended on March 31, 2014, registering a growth of 23.99% over
the last year turnover of Rs. 3692.29 crores.Profit before Tax at Rs. 150.51 crores is 38.75% higher than that of last year of Rs. 108.48
Crores. Profit after Tax for the Financial Year 2013-2014 stood at Rs. 126.63 crores as compared to Rs. 96.53 crores in the previous
year a growth of 31.18%.
3. THE COMPANIES ACT, 2013
The Ministry of Corporate Affairs (MCA) vide its Circular dated April 4, 2014 has clarified that the financial statements and documents
annexed thereto, auditors report and boards report in respect of financial year that have commenced earlier than April 1, 2014 shall
be governed by the provisions of the Companies Act, 1956.With respect to other provisions of the Act, appropriate references have
been made in this report to the extent these provisions have become applicable from April 1, 2014.
4. DIVIDEND
Based on the performance of your Company, the Directors are pleased to recommend a final dividend of Rs. 0.10 per equity share of
Rs. 1 each, which will be paid after your approval at the ensuing Annual General Meeting. The final dividend, if approved by the
members of the Company would involve a cash outflow of Rs. 2.03 Crores (excluding dividend tax of Rs. 0.35 crores).
The dividend will be paid to members whose names appear on the company's register of members after giving effect to all valid share
transfers in physical form lodged with the Registrar and Transfer Agents (RTA) of the company on or before 16th September, 2014, in
respect of shares held in electronic form (demat mode), dividend will be paid to those deemed members whose names appear in the
statement of beneficial ownership furnished by National Securities Depository Limited (NSDL) and Central Depository Services (India)
Limited (CDSL) at the close of business hours on 16th September, 2014.
5. TRANSFER TO RESERVE
The Board of Directors of the Company have recommended a final dividend of Rs. 0.10 per equity share of Rs. 1 each for the financial
year 2013-14. As the dividend is up to 10% of the paid up capital, there is no requirement to transfer any amount to the reserve under
Companies (Transfer of Profit to Reserve) Rules, 1975.
6. SIGNIFICANT DEVELOPMENTS
Your company has during the year enhanced its manufacturing capabilities. The Company has acquired a plant situated at Village
Mumrejpur, Tehsil Dibai, District Bulandshahar, Uttar Pradesh. Your company has also taken initiatives to increase the production
capacities of the newly acquired plant as well as that of the plant situated at Softa to meet the growing demand of its products in the
market. The expanssion programme is under implementation.
The Company is also under process of launching new value added products like variants of flavored milk, UHT milk, Table butter in tubs,
Cream in tetra packs, variants of cheeses and yogurts etc. Some of the products are in production test stage and your Company is
confident of launching these products in the market in near future.
7. CORPORATE SOCIAL RESPONSIBILITY
Your Company defines Corporate Social Responsibility above the philanthropic activities and encompasses all related concepts such
as corporate sustainability, business responsibility and corporate citizenship as the way a company balances its economic, social and
environmental objectives while addressing stakeholder expectations and enhancing shareholder value. The Company is in Dairy
sector, which is an important primary source of livelihood for Indian rural families. Its main objective is to provide rural employment and
income generating opportunity particularly for small, marginal farmers and landless labour (men & women).
The Company shall continue to have among its objectives the promotion and growth of community residing in the vicinity of its plants,
MCCs etc where it seeks to actively assist to uplift the social economy, standard of living and making this community self-reliant as
community living around many of our factories comprises the weakest sections of rural and tribal India with no access to basic
amenities.
DetailsYear ended 31.03.2014
INR in crores
Year ended 31.03.2013
INR in crores
Turnover
Profit before Interest, Depreciation,
Extraordinary Items & Tax
Interest & Finance Charge
Depreciation
Profit Before Extraordinary Item & Tax
Extraordinary Items
Profit before Tax
Tax Expense
Profit after Tax
3692.29
214.04
92.28
10.29
111.48
3.00
108.48
11.95
96.53
4578.05
276.03
112.61
12.91
150.51
----
150.51
23.88
126.63
The Company has outsourced facilities to support the milk producers, who are directly linked in our commercial milk procurement activities. In
order to help such farmers to increase the productivity of their cattle and buffaloes, Kwality Limited has provided, on a principal of no-profit-no-
loss, good quality feed. Our Company is also providing such other technical inputs as vaccinations, artificial insemination, and free advice on
prevention and cure of common diseases.
The Sahayogi Foundation has been set up (the foundation) as a non-profit trust in July 2014. The Foundation will work closely with the Board
of Directors the CSR Committee in implementation of various CSR activities. The Foundation will also assist in reporting progress of deployed
initiatives and in making appropriate disclosures periodically.
MILK PRODUCER CENTRIC PROCUREMENT SYSTEM
Your Company is committed to the upliftment of the rural community by implementing a milk producer centric approach to procure milk and
enhance milk productivity. The approach is being operationalized by forming Village Level Collection Centres (VLCs). We have established a fair
and transparent system through Automatic Milk Collection Units (AMCUs) comprising of Electronic Weighing Scale, Eko Milk Analyser, Data
Processing Unit, printer & display to determine the rate of milk on the basis of quality to the milk producer. Milk is tested for quality parameters
of fat & SNF, quantity is weighed through the Electronic machine, the rate payable is displayed and a payment slip generated by the computer is
handed over to the milk producer. Milk payment is made on every tenth day and is transferred to the joint account, operated by the Village
Service Provider (VSP) and representative of the milk producers.
We have been able to reach out to around 4000 villages situated across the states of Rajasthan, Haryana, Punjab and Uttar Pradesh through
more than 2,70,000 farmers.
a) Productivity Enhancement Programme
Long inter-calving period is one of the greatest impediments in achieving sustainable dairying as the cost of the feed and forages are on the
rise. Nutritional deficiency across the project area is a limiting factor which attributes to infertility in dairy animals. In order to provide good and
balanced quality feed, Kwality Limited has outsourced animal feed processing under the brand of DAIRY BEST. Feed formulation is provided
by the company with an optimal mix of grains and mineral mixture as the ingredient. Feed is processed under the supervision of the competent
company representative to ensure the use of formulation ingredients during the processing.
b) Clean Milk Production Campaign
To ensure the procurement of good quality of raw milk and to create awareness among the milk producers, the Company had organised a
campaign on Clean Milk Production across the milk shed area covering more than 30,000 farmers across various villages.
c) Dairy Animal Health Management
Preventive and curative health management training programs related to dairy animals digestive system, reproductive system and mastitis
control were carried out in collaboration with Ayurvet Limited. About 50 Village Service Providers (VSPs) have been identified as KISSAN
MITRAS and were imparted elementary training at Ayurvet Training Centre. These supvisors are working under experienced veterinarians to
provide preventive treatment to dairy animals.
d) Financial Inclusion Initiative
Your Company has signed a MoUs with Allahabad Bank to assist milk producers to get access to bank credit for the purchase of dairy animals.
Similar arrangement has also been worked out with Central Bank of Indian and Bank of India. SBI and PNB has sanctioned interest free loan of
50 lacs for purchase of 50 dairy animals to two of our VSPs under Kamdhanu Scheme through our assistance.
e) Go Green Initiative
In the pursuit of the fulfillment of the environmental commitment of harnessing solar energy and saving fossil fuel, your Company has provided
75 solar panels at the VLC level which provide power to operate the AMCUs and lights.
f) Capacity Building
Your Company recognizes the need to have quality and trained manpower in order to achieve competitive advantage. With a view to unleash
the potential and sharpen the skills of the employees, a series of in-house and outbound training programs were organised. In accordance
with the skill and competency requirements of the various groups, training programmes on effective communication, team building, milk
chilling centre management, quality of milk testing, dairy animal health management were conducted.
Details of the programmes are as under:
S. No. Training Programme No. of programmes No. of participants
1. Effective communication 4 74
2. Teambuilding 2 20
3. Dairy animal health management 2 40
8. CREDIT RATING
BWR has assigned Long-Term rating of BWRA with Stable Outlook and BWR A1 as short term rating to Kwality Limited overall fund based
Working Capital facilities.
9. FUTURE OUTLOOK
Over the past decade, significant transformation took place in the Indian demographic space which led to heightened consumer interest in
value added products. This shift in the dynamics of the industry proved beneficial for the manufacturers since value added products have
higher margins as compared to liquid milk segment. Considering the higher rate of profit margin expected from the value added Products, your
Company has shifted focus to add new products in its existing product line. To increase procurement of milk through Producer Based Village
Centres. Your Company would be hiring more Milk Chilling Centers (MCC) and also setting up its own large MCCs with capacities of more than
50,000 LPD at different locations in North India.
Future Objectives :
Milk Procurement
Kwality Limited has developed its own comprehensive milk procurement strategy to increase the procurement of high quality milk directly
from the farmers
Setting up Company owned Milk Chilling Centre with a capacity more than 50,000 LPD.
A basis for payment for milk has been devised ensuring the supply of standardised milk by the farmers and preventing adulteration
Farmers are provided with veterinary doctors to look after animal health and artificial insemination need, subsidised animal feed and annual
FMD vaccination so as to provide incentive to farmers to be associated to us and thus increase the number of farmers under each VCC
New Products & Consumer Brands
After the launch of the Low Cholesterol Pure Ghee, Livlite, the Company plans to launch various new products catering to the increasing
health needs of the Indian Consumers
Launch of variants of flavored milk for retail consumers
Setting up manufacturing facilities for products like variant of cheese, drinking yogurt, butter in tubs, cream in tetra packs etc.
Overseas Expansion
Kwality FZE (100% subsidiary of your Company in dubai) plans to increase its import of SMP, WMP , other Dairy Products and derivatives , and
then reprocess, pack and sell these products under its brands, in Dubai and export to other countries.
10. EXPORT
With the removal of ban on the export of skimmed milk powder in June, 2012 and whole milk powder & dairy whitener in November, 2012. Your
Company started export of Dairy products and achieved the export turnover of Rs. 183.45 crores as compared to Rs. 71.74 crores in the FY
2012-13. In the next fiscal year the Company has estimated an increase in export sales based upon the rising demand of dairy products in the
international market and the acceptance of our products from our existing and prospective buyers. The strategy to develop new products and
target new export regions would continue, so that we have a broad based direction of exports.
However the export may be affected during the current year as the Government has withdrawn the VKYUG scheme on SMP.
11. SUBSIDIARY COMPANY & CONSOLIDATED FINANCIAL STATEMENTS
Your Company has a wholly owned subsidiary under the name and style of Kwality Dairy Products FZE in free trade zone of United Arab
Emirates to increase its global foot print and to develop and cater to the new markets.
Your Company has prepared Consolidated Financial Statements in accordance with Accounting Standard 21 and 23 of Companies (Accounting
Standards) Rules 2006. The Consolidated Statements reflect the results of the Company and those of its subsidiary. As required by Clause 32
of the Listing Agreement with the Stock Exchanges, the Audited Consolidated Financial Statements together with the Independent Auditors
Report thereon are annexed and form part of this Annual Report. These consolidated financial statements provide all relevant financial
information about the Company.
12. CASH FLOW STATEMENT
In conformity with the provisions of Clause 32 of the Listing Agreement, the Cash Flow Statement for the year ended on 31st March, 2014 is
attached as a part of the Annual Accounts of the Company.
13. MANAGEMENT DISCUSSION AND ANALYSIS
The management discussion and analysis of the Company for the year under review, as required under Clause 49 of the listing agreement with
the stock exchanges, is given as a separate Section in Annual Report.
14. KEY MANAGERIAL PERSONNELS (KMP):
The Companies Act, 2013 introduced the new concept of Key Managerial Personnel (KMP) which includes the Managing Director, Chief
Executive Officer or Manager, Whole Time Director, Company Secretary and Chief Financial Officer. The Key Managerial Personnel would guide
the Boards to achieve their defined objectives and purposes by adhering to good Corporate Governance practices. KMP would also be looked
upon by the Regulators for the non-compliances.
The new Companies Act, 2013 cast a significant duty on the KMPs in successful management of the company. It clearly specifies that whole
time KMP cannot hold office in more than one company except in its subsidiary at same time.
As per Section 203 of the Companies Act, 2013 and other applicable provisions of the Companies Act, 2013 if any, and the rules made
thereunder, Board of Directors of the Company has appointed Mr. Sunit Shangle as a Chief Financial Officer of the Company with effect from
12th August, 2014 under the preview of Key Managerial Personnel.
The Key Managerial Persons of the Company are:
Name Designation
Mr. Sanjay Dhingra Managing Director
Mr. Sidhant Gupta Director
Mr. Sunit Shangle Chief Financial Officer (CFO)
Ms. Deepa Kapoor Company Secretary
15. DIRECTORS
The Board of your Company is constituted of four Directors comprising of Mr. Sanjay Dhingra, Chairman & Managing Director, Mr. Sidhant
Gupta, Executive Director, Mr. Arun Srivastava, Non-Executive Independent Director and Dr. Rattan Sagar Khanna, Non-Executive Independent
Director.
In terms of Section 203 of the Companies Act, 2013 an individual may be appointed as the Chairperson as well as the Managing Director of the
Company at the same if it is provided in the Article of Association of the Company or the Company carries multiple businesses.
Therefore the Company in order to comply with the provisions of Section 203 proposes to alter its Article of Association in the ensuing Annual
General Meeting in such way that an individual may be appointed as Chairman and Managing Director at the same time.
As per the Companies Act, 2013 Mr. Sanjay Dhingra, Chairman & Managing Director of Company is liable to retire by rotation at the ensuing
Annual General Me