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Company Information

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DABUR INDIA LTD.

23 February 2024 | 12:00

Industry >> Personal Care

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ISIN No INE016A01026 BSE Code / NSE Code 500096 / DABUR Book Value (Rs.) 50.64 Face Value 1.00
Bookclosure 10/11/2023 52Week High 597 EPS 9.63 P/E 55.56
Market Cap. 94857.26 Cr. 52Week Low 504 P/BV / Div Yield (%) 10.57 / 0.97 Market Lot 1.00
Security Type Other

DIRECTOR'S REPORT

You can view full text of the latest Director's Report for the company.
Year End :2023-03 

Your directors have pleasure in presenting the 48th Annual Report on the business and operations of the Company, together with the audited financial statements for the financial year ended March 31,2023 (“FY 2022-23”).

FINANCIAL RESULTS

The standalone and consolidated financial performance of the Company is summarised in the table below: (' in crores)

Particulars Consolidated Standalone FY FY FY FY 2022-23 2021-22 2022-23 2021-22

Revenue from Operations including other Income

11,975.28

11,281.84

9,076.52

8,521.05

Less: Expenses

Cost of goods sold

6,268.67

5,639.69

4,855.01

4,377.21

Employee benefits expenses

1,137.00

1,079.95

725.96

678.71

Finance cost

78.24

38.60

46.37

18.67

Depreciation and Amortization expenses

310.96

252.89

188.29

160.39

Other Expenses

1,960.10

1,915.23

1,402.57

1,389.76

Total Expenses

9,754.97

8,926.36

7,218.20

6,624.74

Profit before share of profit from joint venture and exceptional items and tax

2,220.31

2,355.48

NA

NA

Share of profit/(loss) of Joint Venture

(163)

(180)

NA

NA

Profit before exceptional items and tax

2,218.68

2,353.68

1,858.32

1,896.31

Exceptional items

-

(85.00)

(29.65)

-

Profit before tax

2,218.68

2,268.68

1,828.67

1,896.31

Tax expense

517.35

526.38

455.41

463.38

Net Profit for the year

1,701.33

1,742.30

1,373.26

1,432.93

Other comprehensive income / (loss) for the year

(225.39)

(88.42)

(80.56)

(28.03)

Total comprehensive income for the year

1,475.94

1,653.88

1,292.70

1,404.90

Total comprehensive income attributable to -

Owners of the Holding Company

1481.66

1,650.02

NA

NA

Non-Controlling interest

(5.72)

3.86

NA

NA

TRANSFER TO RESERVES

There is no amount proposed to be transferred to reserves. DIVIDEND

The Company has paid an interim dividend of Rs.2.50 per share of Re.1/- each fully paid up (being 250%) on November 17, 2022. We are pleased to recommend a final dividend of Rs.2.70 per equity share of Re.1/- each fully paid up (being 270%) for FY 2022-23. The dividend recommended, if approved by the members, will be paid to the members within the period stipulated under the Companies Act, 2013 (“the Act”). The aggregate dividend for the year will amount to Rs.5.20 per equity share of Re.1/- each fully paid up (being 520%) being same i.e. Rs.5.20 per share of Re.1/- each fully paid up (being 520%) declared last year. The dividend payout ratio for the current year is at 54.15%. The dividend recommended is in accordance with the Company’s Dividend Distribution Policy.

Dividend Distribution Policy

To bring transparency in the matter of declaration of dividend and protect the interests of investors, Dabur had in place a Dividend Policy since long. The Policy was revised in the board meeting held on May 07, 2021 in accordance with Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing Regulations”) and the Act and has been displayed on the Company’s website at link https://www.dabur.com/sites/ default/files/2021-05/166-Dividend-Distribution-Policy_0.pdf

Unpaid/ unclaimed Dividend

Pursuant to the provisions of Section 124(5) of the Act, final dividend for FY 2014-15 amounting to Rs. 38,85,694/-and interim dividend for FY 2015-16 amounting to Rs. 62,53,174/- which remained unpaid/ unclaimed for a period of 7 years, from the date it was lying in the unpaid dividend account, has been transferred by the Company to the Investors Education and Protection Fund (“IEPF”) of the Central Government. The due dates for transfer of unpaid dividend to IEPF for subsequent years is provided in the Corporate Governance Report. The list of unpaid dividend declared up to FY 2021-22 (updated up to the date of 47th Annual General Meeting held on August 12, 2022) and for interim dividend declared during FY 2022-23 is available on Company’s website www.dabur.com. Shareholders are

requested to check the said lists and if any dividend due to them remains unpaid in the said lists, can approach the Company for release of their unpaid dividend.

FINANCIAL STATEMENTS

As per the provisions of the Act and in accordance with the Circulars issued by the Ministry of Corporate Affairs (“MCA”) and Securities and Exchange Board of India (SEBI), from time to time, the Annual Report 2022-23 containing Balance Sheet, Statement of Profit & Loss, other statements and notes thereto, including consolidated financial statements, prepared as per the requirements of Schedule III to the Act, Directors’ Report (including Integrated Reporting and Management Discussion & Analysis and Corporate Governance Report) is being sent to all shareholders through permitted mode.

The Annual Report 2022-23 is also available at the Company’s website at www.dabur.com.

Consolidated Financial Statements

In compliance with the applicable provisions of the Act including the Indian Accounting Standard Ind AS 110 on Consolidated Financial Statements, this Annual Report also includes Consolidated Financial Statements for FY 2022-23. During FY 2022-23, Consolidated Total Income was Rs.11,975.28 crores as against Rs.11,281.84 crores in the previous year yielding a growth of 6.15%. Further, Net Profit after Tax (after minority interest) for the year stood at Rs.1707.15 crores as against Rs.1,739.22 crores in the previous year.

OPERATIONS AND BUSINESS PERFORMANCE

Kindly refer to the Integrated Reporting and Management Discussion & Analysis and Corporate Governance Report which forms part of this report.

CORPORATE GOVERNANCE

Good governance practices are a norm at Dabur. The Company is committed to focus on long term value creation and protecting stakeholders’ interests by applying proper care, skill and diligence to business decisions. Besides complying with the legal framework of corporate governance practices, Dabur has voluntarily adopted and evolved various practices of governance conforming to highest ethical and responsible standards of business, globally benchmarked. The Company has also formulated a Policy on Group Governance to monitor the governance of its unlisted subsidiaries across the globe.

The report on Corporate Governance as stipulated under the Listing Regulations forms part of the Annual Report. A certificate from Auditors of the Company regarding compliance of the conditions of Corporate Governance, as stipulated under Schedule V of the Listing Regulations is annexed as “Annexure 1” and forms part of this report.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

At Dabur, fulfilment of environmental, social and governance responsibility is an integral part of the way the Company conducts its business.

In terms of the Regulation 34 of the Listing Regulations, the Business Responsibility and Sustainability Report is available on the website of the Company www.dabur.com at weblink https://www.dabur.com/investor/financial-information/ reports/1271/Business-Responsibility-Reports . Any Member interested in obtaining a physical copy of the same may write to the Company Secretary at the Registered Office of the Company.

CREDIT RATING

During the year, the Company has sustained its long-term bank facility credit rating of AAA (Stable) which has been reaffirmed by CRISIL. The highest credit rating of AAA awarded by CRISIL reflects the highest degree of safety regarding timely servicing of financial obligations. Further CRISIL has reaffirmed the rating of NCD programme of the Company as AAA (Stable). The rating indicates highest degree of safety regarding timely servicing of financial obligation. The rated instrument carries lowest credit risk. The Company’s short term bank facility credit rated as A1 by CRISIL, has been reaffirmed. The rating of A1 for Commercial Paper has also been reaffirmed by CRISIL. This highest rating of A1 indicates a very strong degree of safety with regard to timely payment of interest & principal. Such instruments carry lowest credit risk.

Further, ICRA has reaffirmed the rating on long term NCD programme of the Company as AAA (Stable) and assigned the rating on the proposed NCD programme of the Company as AAA (Stable). The rating indicates highest degree of safety regarding timely servicing of financial obligation. The rated instrument carries lowest credit risk and the outlook on the long-term rating is stable. ICRA has also assigned the rating on the Bank limits (rated on long term and short scale) of Rs. 1,000 crores of the Company. Long term Bank limits have been rated as AAA and Short-term limits as A1 . Outlook on the long-term Rating is stable.


DIRECTORS

Pursuant to Sections 149, 152 and other applicable provisions of the Act, one-third of such of the Directors as are liable to retire by rotation, shall retire every year and, if eligible, offer themselves for re-appointment at every Annual General Meeting (AGM). Consequently, Mr. Amit Burman (DIN: 00042050), director will retire by rotation at the ensuing AGM, and being eligible, offers himself for re-appointment in accordance with provisions of the Act.

Mr. P. D. Narang (DIN: 00021581) was re-appointed as a Whole time Director of the Company designated as Group Director- Corporate Affairs for a period of 5 years from April 1, 2023 to March 31, 2028 by the Members at the AGM of the Company held on August 12, 2022 and accordingly will continue to be a Key Managerial Personnel of the Company.

Mr. Rajiv Mehrishi (DIN: 00208189) was appointed as a NonExecutive Independent Director of the Company for a period of 5 consecutive years from September 01,2021 to August 31,2026 by the Members at the AGM of the Company held on August 12, 2022.

Mr. Mohit Malhotra (DIN: 08346826) was appointed as the whole-time director of the Company for a period of five years w.e.f. January 31,2019, and his tenure shall end on January 30, 2024. In terms of Sections 196, 197, 198, 203 and other applicable provisions of the Act and upon recommendation of the Nomination and Remuneration Committee, the Board of Directors of the Company in their meeting held on May 04, 2023 have re-appointed him as a Whole Time Director and Chief Executive Officer of the Company for a further period of 5 years with effect from January 31, 2024 to January 30, 2029 and have recommended his re-appointment for approval of the members at the ensuing AGM.

As per Sections 149, 150 and 152 read with Schedule IV of the Act, the Company had appointed Mr. Ajit Mohan Sharan (DIN: 02458844) as Non-Executive Independent Director of the Company for a term of 5 (five) consecutive years w.e.f. January 31, 2019 to January 30, 2024. He is eligible for re-appointment as Independent Director. Considering the good performance evaluation report of the director, the Board of Directors of the Company, on the recommendation of Nomination and Remuneration Committee, in their meeting held on May 04, 2023 have re-appointed him for a second term of 5 (five) consecutive years, with effect from January 31, 2024 to January 30, 2029, subject to approval of shareholders in the ensuing AGM. The Company has received necessary disclosures and notice with respect to re-appointment of Mr. Ajit Mohan Sharan.

Further, pursuant to Sections 149, 152, 161 read with Schedule IV and other applicable provisions of the Act, Companies (Appointment and Qualification of Directors) Rules, 2014 and Listing Regulations and upon recommendation of Nomination and Remuneration Committee, the Board of Directors of the Company at their meeting held on May 4, 2023 have appointed Mrs. Satyavati Berera (DIN: 05002709) as an Additional Director in the category of Non-Executive Independent Director of the Company w.e.f. June 01, 2023 for a period of 5 consecutive years till May 31,2028, subject to approval of the shareholders at the ensuing AGM, for a period of 5 consecutive years from the date of appointment. The Company has received necessary disclosures and notice with respect to appointment of Mrs. Berera.

After close of the FY 2022-23, Dr. Anand Chand Burman (DIN: 00056216) who was appointed on March 25, 2022 as an alternate director to Mr. Amit Burman (DIN:00042050), Non-Executive Promoter Director, has ceased from the position of Alternate Director on April 8, 2023, upon return of Mr. Amit Burman to India.

A brief resume of the directors being appointed/ re-appointed, the nature of expertise in specific functional areas, names of companies in which they hold directorships, committee memberships/ chairmanships, their shareholding in the Company, etc., have been furnished in the explanatory statement to the notice of the ensuing AGM.

The Nomination and Remuneration Committee and the Board of Directors of the Company recommend their appointment / reappointment at the ensuing AGM.

The Company has received necessary declaration from all the Independent Directors under Section 149(7) of the Act and Regulation 25(8) of the Listing Regulations confirming that they meet the criteria of independence as laid down in Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations. The Company has also received from them declaration of compliance of Rule 6(1) & (2) of the Companies (Appointment and Qualifications of Directors) Rules, 2014, regarding online registration with the Indian Institute of Corporate Affairs, Manesar, for inclusion/ renewal of name in the data bank of Independent Directors. With regard to integrity, expertise and experience (including the proficiency) of the Independent Directors, the Board of Directors have taken on record the declarations and confirmations submitted by the Independent Directors and is of the opinion that they are persons of integrity and possesses relevant expertise and experience and their continued association as Director will be of immense benefit and in the best interest of the Company. With regard to proficiency of the independent Directors,

ascertained from the online proficiency self-assessment test conducted by the Institute, as notified under Section 150(1) of the Act, the Board of Directors have taken on record the information submitted by Independent Directors that they have complied with the applicable laws.

None of the Directors of the Company are related inter-se except for Dr. Anand Chand Burman (alternate director to Mr. Amit Burman), who is father of Mr. Aditya Burman, in terms of Section 2(77) of the Act including rules made thereunder.

Key Managerial Personnel

As at March 31, 2023, following are the Key Managerial Personnel (KMP) of the Company as per Sections 2(51) and 203 of the Act:

• Mr. Pritam Das Narang, Whole time director

• Mr. Mohit Malhotra, Whole time director & Chief Executive officer

• Mr. Ashok Kumar Jain, Executive Vice President (Finance) and Company Secretary

• Mr. Ankush Jain, Chief Financial Officer.

Policy on Directors’ appointment and Policy on remuneration

Pursuant to Section 134(3)(e) and Section 178(3) of the Act, the policy on appointment of Board members including criteria for determining qualifications, positive attributes, independence of a director and the policy on remuneration of directors, KMP and other employees are annexed as “Annexure 2 & 3” respectively to this report. The same are also available on the website of the Company at www.dabur.com at weblink https:// www.dabur.com/sites/default/files/2021-05/111972-policy-on-appointment-of-board-members.pdf

Particulars of remuneration of Directors/ KMP/ Employees

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as ‘Annexure 4A’ to this report. Further, in terms of the provisions of Section 197(12) of the Act read with Rule 5(2) and 5(3) of the aforesaid Rules, a statement showing the names and other particulars of employees drawing remuneration in excess of the limits set out in the said rules is annexed as ‘Annexure 4B’ to this report.

Employees Stock Option Plan

During FY 2022-23, 46,83,795 options were granted to eligible employees of the Company in terms of Employees Stock Option Plan (Dabur ESOP 2000).

Further, during the year under review, there have been no changes in the Employees Stock Option Plan (Dabur ESOP 2000) of the Company. Further, it is confirmed that the ESOP Scheme of the Company is in compliance with (Share Based Employee Benefits and Sweat Equity) Regulations, 2021.

The applicable disclosures as stipulated under Regulation 14 of SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 with regard to Employees Stock Option Plan of the Company are available on the website of the Company at www.dabur.com and web link for the same is https://www.dabur.com/investor/investor-information/esops

A certificate from the Secretarial Auditors of the Company certifying that the Employee Stock Option Scheme of the Company is implemented in accordance with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 and in accordance with the resolutions passed in the General Body Meetings will be available for inspection during the AGM to any person having right to attend the meeting.

Performance Evaluation of the Board, its Committees and Individual Directors including Independent Directors

Pursuant to applicable provisions of the Act and the Listing Regulations, the Board, in consultation with its Nomination and Remuneration Committee, has formulated a framework containing, inter-alia, the criteria for performance evaluation of the entire Board of the Company, its Committees and individual directors, including Independent Directors. The framework is monitored, reviewed and updated by the Board, in consultation with the Nomination and Remuneration Committee, based on need and new compliance requirements.

The annual performance evaluation of the Board, its Committees and each Director has been carried out for the FY 2022-23 in accordance with the framework. The details of evaluation process of the Board, its Committees and individual directors, including independent directors have been provided under the Corporate Governance Report which forms part of this Report.

Directors’ Responsibility Statement

Pursuant to the provisions under Section 134(3)(c) and 134(5) of the Act, with respect to Directors’ Responsibility Statement, the Directors confirm:

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

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

c) That they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) That they had prepared the annual accounts on a going concern basis;

e) That they had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

f) That they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

STATUTORY AUDITORS AND THEIR REPORT

Pursuant to the provisions of Section 139 of the Act and Rules made thereunder, M/s. G. Basu & Co., Chartered Accountants (Firm Registration No. 301174E) were appointed as Statutory Auditors of the Company for a term of five consecutive years, to hold office from the conclusion of the 47th AGM held on August 12, 2022 until the conclusion of 52nd AGM of the Company to be held in the calendar year 2027.

M/s G. Basu & Co., Chartered Accountants, have submitted their Report on the Financial Statements of the Company for the FY 2022-23, which forms part of the Annual Report 202223. There are no observations (including any qualification, reservation, adverse remark or disclaimer) of the Auditors in the Audit Reports issued by them which call for any explanation/comment from the Board of Directors.

The Auditors have also confirmed that they have subjected themselves to the peer review process of Institute of Chartered Accountants of India (ICAI) and hold a valid certificate issued by the Peer Review Board of the ICAI.

COST AUDITORS AND THEIR REPORT

Pursuant to the provisions of Section 148 of the Act read with Companies (Cost Records and Audit) Rules 2014, M/s Ramanath Iyer & Company, Cost Accountants, (Firm’s Registration No. 000019) have been re-appointed as Cost

Auditors for the financial year 2023-24 to conduct cost audit of the accounts maintained by the Company in respect of the various products prescribed under the applicable Cost Audit Rules. The remuneration of Cost Auditors has been approved by the Board of Directors on the recommendation of Audit Committee. The requisite resolution for ratification of remuneration of Cost Auditors by members of the Company has been set out in the Notice of ensuing AGM. The Cost Auditors have certified that their appointment is within the limits of Section 141(3)(g) of the Act and that they are not disqualified from appointment within the meaning of the said Act.

The Cost Audit Report for the financial year 2021-22, issued by M/s Ramanath Iyer & Company, Cost Auditors, in respect of the various products prescribed under Cost Audit Rules was filed with the Ministry of Corporate Affairs on August 23, 2022.

There were no observations (including any qualification, reservation, adverse remark, or disclaimer) of the Cost Auditors in the Report issued by them for the financial year 2021-22 which call for any explanation/comment from the Board of Directors.

SECRETARIAL AUDITORS AND THEIR REPORT

M/s Chandrasekaran Associates, Company Secretaries, were appointed as Secretarial Auditors of the Company for FY 2022-23. The Secretarial Audit Report submitted by them for the said financial year in the prescribed form MR-3 pursuant to the provisions of Section 204 of the Act and Regulation 24A(1) of the Listing Regulations is annexed as ‘Annexure 5’ to this report.

The observations made by the Secretarial Auditors in the Report issued by them for FY 2022-23 are self-explanatory and do not require any further explanation/comment from the Board of Directors.

M/s Chandrasekaran Associates, Company Secretaries have been re-appointed to conduct the secretarial audit of the Company for FY 2023-24. They have confirmed that they are eligible for the said appointment.

INTERNAL FINANCIAL CONTROL SYSTEM

According to Section 134(5)(e) of the Act, the term Internal Financial Control (IFC) means the policies and procedures adopted by the company for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy

and completeness of the accounting records, and the timely preparation of reliable financial information.

The Company has a well-placed, proper and adequate IFC system which ensures that all assets are safeguarded and protected and that the transactions are authorised, recorded and reported correctly. The Company’s IFC system also comprises due compliances with Company’s policies and Standard Operating Procedures (SOPs) and audit and compliance by internal audit checks from Pricewaterhouse Coopers Pvt. Ltd., the Internal Auditors. The Internal Auditors independently evaluate the adequacy of internal controls and concurrently audit the majority of the transactions in value terms. Independence of the audit and compliance is ensured by direct reporting of Internal Auditors to the Audit Committee of the Board.

To further strengthen the internal control process, the Company has developed a very comprehensive legal compliance system called “e-nforce”, which drills down from the CEO to the executive level person who is responsible for compliance. This process is fully automated and generate alerts for proper and timely compliance.

Adequacy of Internal Financial Controls with reference to the financial statements

The Act re-emphasizes the need for an effective Internal Financial Control system in the Company which should be adequate and shall operate effectively. Rule 8(5)(viii) of Companies (Accounts) Rules, 2014 requires the information regarding adequacy of Internal Financial Controls with reference to the financial statements to be disclosed in the Directors’ Report.

To ensure effective Internal Financial Controls, the Company has laid down the following measures:

• All operations are executed through Standard Operating Procedures (SOPs) in all functional activities for which key manuals have been put in place. The manuals are updated and validated as and when required.

• All legal and statutory compliances are ensured on a monthly basis for all locations in India through a fully automated tool called “e-nforce”. Non- compliance, if any, is seriously taken by the management and corrective actions are taken immediately. Any regulatory amendment is updated periodically in the system.

• Approval of all transactions is ensured through a preapproved Delegation of Authority (DOA) Schedule which is in-built into the SAP system. DOA is reviewed periodically by the management and compliance of DOA is regularly checked and monitored by the auditors.

• The Company follows a robust 2-tier internal audit process:

Ý Tier-1: Management/ Strategic/ Proprietary audits are conducted on regular basis throughout the year as per agreed audit plan.

Ý Tier-2: Transaction audits are conducted regularly to ensure accuracy of financial reporting, safeguard and protection of all the assets. Stock audit is conducted on quarterly basis at all locations in India. Fixed Asset Verification is done on an annual basis including Ind AS-36 testing at all locations.

Ý The audit reports for the above audits are compiled and submitted to management committee and audit committee for review and necessary action.

• The Company’s Books of Accounts are maintained in SAP and transactions are executed through SAP (ERP) setups to ensure correctness/ effectiveness of all transactions, integrity and reliability of reporting.

• The Company has a comprehensive risk management framework which is evaluated by the Audit Committee annually.

• The Company has a robust mechanism of building budgets at an integrated cross- functional level. The budgets are reviewed on a monthly basis so as to analyze the performance and take corrective action, wherever required.

• The Company has in place a well-defined Whistle Blower Policy/ Vigil Mechanism.

• The Company has a system of Internal Business Reviews. All departmental heads discuss their business issues and future plans in monthly review meetings. They review their achievements vs. budgets in quarterly review meetings. Specialized issues like investments, property, FOREX are discussed in their respective internal committee meetings.

• Compliance of secretarial functions is ensured by way of secretarial audit.

• Compliance relating to cost records of the company is ensured by way of cost audit.

DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT

Dabur has in place comprehensive risk assessment and mitigation framework, which is reviewed by the Board periodically. The Risk Management Committee of the Board is responsible for preparation of Risk Management Plan, reviewing and monitoring the same on regular basis, identifying and reviewing critical risks on regular basis, updating the Risk Register on quarterly basis, reporting of key changes in critical

risks to the Board on an ongoing basis and a detailed report on yearly basis, evaluation of risk management systems by the Audit Committee on yearly basis and such other functions as may be prescribed by the Board.

The Committee holds quarterly meetings to review the critical risks identified. The risks faced by the Company, their impact and their minimization procedures are assessed categorically under the broad heads of High, Medium and Low risks.

Further, the risks control systems are instituted to ensure that the risks in each business process are mitigated. The two joint Chief Risk Officers (CROs) are responsible for the overall risk governance in the Company and reports directly to the Management Committee (MANCOM), which consists of various functional heads. The Board provides oversight and reviews the Risk Management Policy. The Board is responsible for framing, implementing and monitoring the risk management plan of the Company. During the year, Pricewaterhouse Coopers Pvt. Ltd., Internal auditors, had tested the Risk & Control Matrices for various processes as a part of Internal financial control framework.

In line with the Listing Regulations, cyber security risk is included in the risk management plan and a Risk Management Policy with respect to Commodities, including through hedging is also in place.

In the opinion of the Board there has been no identification of elements of risk that may threaten the existence of the Company.

NATURE OF BUSINESS

There has been no change in the nature of business of the Company.

Dabur has a diverse portfolio consisting of a number of brands and sub-brands across the three verticals of Home and Personal care, Healthcare and Foods. The Company has presence across various channels such as general groceries, chemists, organized retail and ecommerce.

During the year, the key pillars of Company’s strategy were as follows:

1. Expanding the Total Addressable Market: The Company continued to innovate to increase the total addressable market of its portfolio. New products contributed to around 4% of the revenue during FY 2022-23. Some of the key launches in the domestic market were:

Health

Supplements

• Dabur Vedic Green Tea Detox Kahwa

• Dabur Vedic Tea

• Dabur Gur Chyawanprash

• Dabur Hadjod and Gokshura Tablets

• Dabur Ratnaprash Sugar Free

Digestives

• Hajmola Amla Candy

OTC

• Dabur Castor Oil

Ethicals

• Dabur Shuddh Shilajit

• Dabur Shodhit Guggulu

• Dabur Aampachak Kadha

• Dabur Gulkand

• Dabur Sarpagandhaghan Vati

• Dabur Arnica Hair Oil

• Dabur Calendula Soap

• Dabur Pushpadhanwa Ras

Hair Oils

• Vatika Neelibhringa 21 Hair Oil

Oral Care

• Dabur Herb’l (Olive and Blackseed Variants)

• Dabur Red BAE Fresh Gel

Home Care

• Odonil Air Freshener Neem

Skin Care

• Gulabari Moisturizing Body Lotion

• Oxylife Salon Professional Aqua Manicure & Pedicure Kit

• Fem Sanitary Napkins

Beverages

• Real Vitamin Boost Range (Mixed Fruit, Guava, Litchi)

• Real Milkshakes (Chocolate Frappe and Cafe Frappe)

• Dabur Sharbat-e-Azam Dry Fruit Syrup Range (Badam Kesaria, Kesaria Thandai)

Food

• Real Peanut Butter

2. Expanding Distribution Coverage and Improving

Efficiency:

a. In terms of distribution, the Company increased its direct reach from 1.31 million to 1.40 million, taking the total reach to 7.7 million outlets.

b. Village coverage expansion continued in FY 2022-23 with village coverage crossing 1 lakh villages from 89,840 villages in FY 2021-22. This expansion in reach was supported through Project Yoddha, wherein Dabur continue to partner with local representatives in villages to ensure its brands and products reached every rural household, helped to increase penetration and stabilize business in rural markets.

c. Improving efficiency of the sales & distribution network was a key priority for the Company. The steps taken using technology-enabled interventions helped drive the EDGE (Everyday Great Execution) score up by 1,500 bps.

d. E-commerce with 30% growth and Modern Trade with 17% growth continued to be drivers of its growth.

3. Efficiency in the Value Chain and Cost Management:

Dabur continued to keep a close eye on the value chain and further increased its focus on driving both operational and financial improvements in the face of high inflation.

Further updates regarding operational performance and projects undertaken by the subsidiary companies can be referred in the report on performance of subsidiaries presented elsewhere in this report.

SUBSIDIARIES

Dabur Tunisie, a step down wholly owned subsidiary company which was decided to be dissolved during the financial year 2017-18, is under process of liquidation and is expected to be completed by December 31,2023.

Herbodynamic India Limited, which was a wholly owned subsidiary of the Company, had applied for voluntary striking off under the provisions of Section 248 of the Act in April 2022, as it had not commenced any business since incorporation. The Company was struck off from the register of Registrar of Companies, NCT of Delhi & Haryana and had dissolved and ceased to be subsidiary of the Company w.e.f. January 11, 2023.

Asian Consumer Care Private Limited (Bangladesh), step down subsidiary of the Company had become a step down wholly owned subsidiary of the Company w.e.f. November 24, 2022, upon acquisition of remaining 24% of equity shares held by the Joint Venture partner- M/s Advanced Chemicals Industries Limited. Further, post-acquisition, name of Asian Consumer Care Private Limited was changed to Dabur Bangladesh Private Limited w.e.f. February 16, 2023.

During the year, the Company had acquired 51% equity shareholding of Badshah Masala Private Limited (Badshah) from its existing shareholders and promoters. Upon completion of transaction on January 2, 2023, Badshah has become a subsidiary of the Company w.e.f. January 2, 2023.

Pursuant to Section 129 (3) of the Act and Ind - AS 110 issued by the Institute of Chartered Accountants of India, Consolidated Financial Statements presented by the Company include the financial statements of its subsidiaries.

During the year, no other company, except the companies as mentioned above, has become or ceased to be subsidiary, joint venture or associate of the Company.

Further, a separate statement containing the salient features of the financial statements of Subsidiaries/

Associate/Joint Venture of the Company in the prescribed form AOC-1 has been disclosed in the Consolidated Financial Statements.

The Financial Statements, as required, of the subsidiary companies shall be available on website of the Company at www.dabur.com.

Report on the highlights of performance of Subsidiaries, Associates and Joint Venture Companies and their contribution to the overall performance of the company.

Pursuant to Section 134 of the Act and Rule 8(1) of the Companies (Accounts) Rules, 2014 the report on highlights of performance of subsidiaries, associates and joint venture companies and their contribution to the overall performance of the Company is annexed as ‘Annexure 6’ to this report.

Information with respect to financial position of the above entities can be referred in form AOC-1 which has been disclosed in the Consolidated Financial Statements.

Details of policy developed and implemented on Corporate Social Responsibilities (CSR) initiatives

The Company has in place a CSR policy in line with Schedule VII of the Act. As per the policy the CSR activities are focused not just around the plants and offices of the Company, but also in other geographical area based on the needs of the communities. The four focus areas where special Community Development programmes were run during the year are:

1. Eradicating hunger, poverty and malnutrition.

2. Promoting Health care including preventive health care.

3. Ensuring environmental sustainability.

4. Promotion of Education.

During the year CSR programmes were also conducted in areas of

• Vocational Training and Women empowerment, and

• Promotion of Sports

The annual report on CSR activities is furnished in ‘Annexure 7’ which is annexed to this report.

CHANGE IN CAPITAL STRUCTURE AND LISTING OF SHARES

The paid-up share capital of the Company as on March 31, 2023 is Rs.1,77,17,63,464/- divided into 1,77,17,63,464 equity shares of Re.1/- each. The Company’s equity shares are listed

on the National Stock Exchange of India Limited (NSE) and BSE Limited (BSE). During the year, 39,06,981 equity shares of Re.1/- each were allotted under ESOP scheme of the Company and admitted for trading on NSE and BSE.

The shares are actively traded on NSE and BSE and have not been suspended from trading.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There have been no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of this report, which forms part of this report.

DISCLOSURES

Number of Meetings of the Board

During FY 2022-23, 5 (five) Board Meetings were held. For details thereof kindly refer to the section “Board of Directors - Number of Board Meetings”, in the Corporate Governance Report.

Disclosure on Audit Committee

The details pertaining to the composition of the Audit Committee as at March 31, 2023 including its terms of reference and attendance of directors at the Committee Meetings has been provided in the section ‘Committees of the Board - Audit Committee’, in the Corporate Governance Report, which forms part of this Report.

All recommendations of Audit Committee were accepted by the Board of Directors.

Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

Pursuant to provisions of Section 134 of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014 the details of Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo are annexed as ‘Annexure 8’ to this report.

Environmental, Health and Safety (EHS) Review

Details with respect to Environmental, Health and Safety (EHS) review are annexed as ‘Annexure 9’ to this report.

Annual Return

The Annual Return as on March 31,2023 in the prescribed Form No. MGT-7, pursuant to Section 92 of the Act is available on the website of the Company at www.dabur.com at the link https:// www.dabur.com/investor/investor-information/annual-return

Particulars of Loans, Guarantees or Investments under Section 186 of the Act

Particulars of loans, guarantees and investments under Section 186 of the Act as at the end of FY 2022-23 are provided in the standalone financial statements (refer Note No. 48).

Contracts or arrangements with related parties under Section 188(1) of the Act

With reference to Section 134(3)(h) of the Act, all contracts and arrangements with related parties under Section 188(1) of the Act, entered by the Company during the financial year, were approved by the Audit Committee and wherever required, also by the Board of Directors. No contract or arrangement required approval of shareholders by a resolution. Further, during the year, the Company had not entered into any contract or arrangement with related parties which could be considered ‘material’ (i.e. transactions entered into individually or taken together with previous transactions during the financial year, exceeding rupees one thousand crore or ten percent of the annual consolidated turnover as per the last audited financial statements of the Company, whichever is lower) according to the policy of the Company on materiality of Related Party Transactions.

Further, there were no transactions undertaken during the year which were not at an arm’s length basis, hence the disclosure under Form AOC-2 is not applicable to the Company.

You may refer to Related Party transactions in Note No. 55 of the Standalone Financial Statements for more details.

Details in respect of frauds reported by Auditors other than those which are reportable to the Central Government

The Statutory Auditors, Cost Auditors or Secretarial Auditors of the Company have not reported any frauds to the Audit Committee or to the Board of Directors under section 143(12) of the Act, including rules made there under.

Disclosure on Public Deposits

During the year under review, the Company has neither accepted nor renewed any deposits in terms of Chapter V of the Act and Rules framed thereunder.

Disclosure on Vigil Mechanism

The Company has established a vigil mechanism through which directors, employees and business associates may report unethical behavior, malpractices, wrongful conduct, fraud, violation of Company’s code of conduct, leak or suspected leak of unpublished price sensitive information without fear of reprisal. The Company has set up a Direct Touch initiative, under which all directors, employees, business associates have direct access to the Chairman of the Audit committee, and also to a three-member direct touch team established for this purpose. The direct touch team comprises one senior woman member so that women employees of the Company feel free and secure while lodging their complaints under the policy. Further information on the subject can be referred to in section ‘Policies, Affirmations and Disclosures’ - Whistle-Blower Policy / Vigil Mechanism of the Corporate Governance Report.

Disclosure on Cost Records

Pursuant to provisions of Section 134 of the Act read with Rule 8(5)(ix) of the Companies (Accounts) Rules, 2014 it is confirmed that maintenance of cost records as specified by the Central Government under sub-section (1) of section 148 of the Act, is required by the Company and accordingly such accounts and records are made and maintained.

Disclosure under Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013

At Dabur, all employees are of equal value. There is no discrimination between individuals at any point based on race, colour, gender, religion, political opinion, national extraction, social origin, sexual orientation or age.

At Dabur, every individual is expected to treat his/her colleagues with respect and dignity. This is enshrined in values and in the Code of Ethics & Conduct of Dabur.

The Company also has in place ‘Prevention of Sexual Harassment Policy’ in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. All employees (permanent, contractual, temporary and trainees) are covered under this policy.

The Company has complied with provisions relating to the constitution of Internal Complaints Committee (ICC) under The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 to redress complaints received regarding sexual harassment.

The Direct Touch (Whistle-Blower & Protection Policy) policy also provides a platform to all employees for reporting unethical business practices at workplace without the fear of reprisal and help in eliminating any kind of misconduct in the system. The policy also includes misconduct with respect to discrimination or sexual harassment.

The following is a summary of sexual harassment complaints received and disposed of during the year:

• No. of complaints received: Nil

• No. of complaints disposed of: NA

• No. of complaints pending: Nil

Significant and material orders passed by the regulators or courts or tribunals impacting the going concerns status and company’s operations in future

The Company has not received any significant or material orders passed by any regulatory authority, court or tribunal which shall impact the going concern status and Company’s operations in future.

Other Disclosures

1. Details of application made or any proceedings pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the financial year:

During the year, one petition was filed by Visiontech Automation (Partnership Firm) under section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC), as an operational creditor, against Dabur India Limited claiming an amount of Rs.1.68 crore as operational debt under the IBC. Dabur is contesting the petition filed by the operational creditor and has filed its reply before the NCLT, New Delhi. As at the end of financial year the case is pending for hearing before the NCLT, New Delhi.

2. The details of difference between amount of the valuation done at the time of one-time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with reasons thereof:

There were no transaction requiring disclosure or reporting in respect of matter relating to instance of onetime settlement with any bank or financial institution.

Secretarial Standards

The applicable Secretarial Standards, i.e. SS-1 and SS-2, relating to ‘Meetings of the Board of Directors’ and ‘General Meetings’, respectively, have been duly followed by the Company.


INDUSTRIAL RELATIONS

The Company maintained healthy, cordial and harmonious industrial relations at all levels. The enthusiasm and unstinting efforts of employees have enabled the Company to remain at the leadership position in the industry. It has taken various steps to improve productivity across organization.

ACKNOWLEDGEMENT

Your directors place on record their gratitude to the Central Government, State Governments and Company’s Bankers

for the assistance, co-operation and encouragement they extended to the Company. Your directors also wish to place on record their sincere thanks and appreciation for the continuing support and unstinting efforts of investors, vendors, dealers, business associates and employees in ensuring an excellent all around operational performance.

For and on behalf of the Board Mohit Burman

Place: New Delhi Chairman

Date : 04 May, 2023 DIN: 00021963