Corporate Overview Statutory Reports Financial Statements

WHOLESOME
LIVING
PARAG MILK FOODS LIMITED
ANNUAL REPORT 2020-2021
1
 Contents
CORPORATE OVERVIEW
A prelude to wholesome living 02
Our story of wholesome living 04
Our wholesome strategy for value addition and sustainability 08
Our financial performance 10
We are Parag Milk Foods 12
Our wholesome approach 18
Our wholesome offerings 20
Our wholesome offering for every strata 29
All about our manufactuting 30
The future of dairy farming 34
Our consumer engagement drive 36
Navigating through the COVID-19 crisis 40
ESG update 42
Corporate Social Responsibility 50
Message from Chairman 54
Message from Managing Director 56
Board of Directors 58
Management Team 60
Corporate Information 61
STATUTORY REPORTS
Management Discussion and Analysis 62
Directors’ Report 74
Corporate Governance Report 96
Business Responsibility Report 120
FINANCIAL STATEMENTS
Standalone 132
Consolidated 186

Management assurance statement

The contents of this Report have been reviewed by the Company’s Senior Management under the guidance
of the Board. This has ensured the integrity, accuracy and completeness of the information disclosed in the
Report. Forward looking statement In this Annual Report, we have disclosed forward looking information to
enable investors to comprehend our prospects and take investment decisions. The Report contains anticipated
results based on the Management’s plans and assumptions. We cannot guarantee that these

Forward-looking statements:
Will be realised, although we believe we have been prudent in our assumptions. The achievements of results
are subject to risks, uncertainties and inaccurate assumptions. Should known or unknown risks or uncertainties
materialise, or should underlying assumptions prove inaccurate, the actual results could vary materially from
those anticipated, estimated or projected. Readers should keep in mind that we undertake no obligation
to publicly update any forward-looking statement, whether as a result of new information, future event or
otherwise.
Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

A prelude to
wholesome
living
A life full of fun, frolic and food! Cooked at home,
ordered from outside or enjoyed outside of our homes.
A food experience that quenches the taste buds while
also nourishing the body and soul,
A multicuisine restaurant that serves ‘Dadi ke hath
ki kheer’ over the Sunday brunch to the teenage
granddaughter’s tryst with homemade pizza for the
family dinner.
A life that shapes the grandson blossom into a complete
man from the blue-eyed boy that he always was along
with the entire family and also the neighborhood,
A lush green landscape with healthy cows foraging on
the choicest menu and they being taken care of like
the queens by lakhs of farmers providing their daily
livelihood of milk twice a day to the overall community
who takes pride in the Company for being at their side
during difficult times to the vendors and transporters
who feel more than part of the family.
Welcome to wholesome living, a precious possibilities that are age-old, virtuous
gift that Parag Milk Foods Limited (PMFL) complete food, Milk, possessed.
is bringing to the homes and lives of
At PMFL, we are passionate about
millions of Indians.
discovering many shades of white, for
From awesome food to handsome dudes greater consumer good and keep presenting
to heartsome beverages to delightsome innovations that are pioneering and ahead
garnishing to lovesome bonding, PMFL of time. Because, our consumers deserve
brings to the aspirational, upwardly nothing less than the best. Nothing less
mobile Indian consumer households a than a wholesome living.
myriad of food, beverage and wellness

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

Our story of
wholesome living
As the world stares at one of the most with uninterrupted operations, wherein
unprecedented times in the history of our plants continued to operate at
mankind, the importance of wholesome almost full utilization levels. Amidst
living has become all the more relevant! restrictions and lockdowns, we ensured
The pandemic has highlighted all things that our last-mile connectivity remains
that we were initially oblivious to and intact and our products continue to
forced us to align ourselves with the reach shelves on time. This is how,
new normal, and pay heed to our health we brought together, to unify a
and wellness. Today, the impetus is complementary set of businesses and
more on a balanced diet and immuno- target an opportunity by leveraging
boosters have become everyone’s our collective market strength,
staple. The pandemic has necessitated brand influence, innovation power
the urgency for careful consideration of and distribution reach to provide a
health & fitness intake by people of all wholesome living.
age groups, gender and ethnicity. And,
it is here that the Parag Milk Foods has During the lockdown, we have been
a pivotal role to play. a strong pillar for our most trusted
partner, the farmers wherein we built
We, at Parag Milk Food, are surely stronger ties with them. We kept on
a potent medium of promulgating procuring milk from them and ensured
wholesome living through our gamut much higher milk collection when there
of offerings like Milk, Ghee, Cheese, was a lesser demand. This solidarity
Curd, Beverages, Paneer, Whey with the farmers not only helped us win
protein, Butter, etc. Our relentless the trust of our faithful partner and an
effort to bring in quality products for important stakeholder but also made
our consumers has made us stand out us an important channel of livelihood
during the current pandemic situation for them in the challenging times of
and despite all odds, we have managed COVID-19.
to stay the course.
The lockdowns not only restricted the
We have been an initiator of a movement of stocks but also limited
better life for all our stakeholders for the accessibility of manpower and
wholesome living. We stayed close to logistics. However, we overcame the
the ground and continued to engage all situation by adopting several steps of
our stakeholders by standing with them cost rationalization efforts, which in
during this tough time. We stood with turn, helped us minimise the adverse
our farmers and procured every drop of impact on profitability. One of the
milk in these testing times, continued major areas where we took proactive
to motivate all our factory workers decisions and put relentless efforts
with a COVID safe environment, daily towards fruition was distribution and
cash incentives and plant-to-home supply chain.
safe mobility solution. We continued

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

As a part of the trust-building exercise, we

went on to adapt and align our distribution We opted for
as well as the supply chain set up
accordingly and introduced new products targeted marketing
and several brand-building efforts.
wherein we
Our efforts were not only limited to meeting combined the
consumer’s needs and empowering the
farmers economically and establishing a excellence of our
long-lasting association and trust with
the dairy farmers community but we also products and
worked on revving up our technological avant-garde
wing to bring innovative products par
excellence and forging ties that helped us practices of
to come up with cost-efficient distribution
network. We opted for targeted marketing co-operatives at the
wherein we combined the excellence of backend and FMCG
our products and avant-garde practices of
co-operatives at the backend and FMCG companies at the
companies at the frontend that helped us
grow sustainably. frontend that helped
us grow sustainably.
We have focused on further consolidating
and strengthening by concentrating on
four core categories - Gowardhan Ghee,
Gowardhan Paneer, Go Cheese and Avvatar
– Whey protein. This focussed approach the importance of sustainability and
helped us achieve the highest ghee sales environmental friendliness, we have
in summer and cheese sales in winter. adopted the practices like installing
Remaining true to our DNA of innovation latest ETP technology, wastewater and
and wholesome living we extended our air pollution management, etc. Further
premium brand offering by launching on, we have achieved a substantial
-Pride of Cows Ghee and Pride of Cows operational efficiency right from
Curd, We have not only succeeded in product enhancement to establishing
advocating wholesome living through our farmer’s livelihood, and consumer
innovation but also assuring sustainable engagement, which has resulted in
living through our eco-friendly practices wholesome living, and thus this has
of reuse, recycle and reduce. Considering become the way of our business.

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

Our wholesome
strategy
for value addition Strengthened our

and sustainability
brands via
• E
nhancement of brand recall through
strategic branding initiatives
Enhanced product • Employed various channels like traditional
reach by media, digital media, influencer, bloggers
We have continued with a focused • S trengthening distributor etc to stay connected with our consumers
and stockists base to achieve
approach towards creating value in all higher retail penetration
our functions. • Introducing low unit price
products in Tier III cities
• Identifying specific states and
regions in India to increase
sales volumes
• Automation of sales force and
distribution touch points
Increased milk
procurement by
• S trengthening existing farmer
relations
• Offering quality & quantity based
incentives
• Setting up new collection centres &
reach new districts
• Adding new bulk coolers &
automated collection systems

Increased value-added product portfolio by

• O ffering a wider range of Farm-to-Home products under
‘Pride of Cows’
Increased operational
• Focussing on health & nutritional aspect in developing
efficiencies Focused on health and
premium products We leveraged in-house nutrition through
• Converting high-selling HoReCa products into consumer packs technological R&D capabilities in
and providing consumers restaurant like feeling at home order to: • Introduction of healthy and
• Maintain strict operational nutritious product variants
controls • Bringing products to suit the
• Enhance consumer service Indian palette
levels
• Develop customised systems &
processes

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

Our financial
Revenue EBITDA
(Rs. Mn) (Rs. Mn)

performance
24.5% 40.9%
24,379 2,111

18,418
1,248

FY20 FY21 FY20 FY21

Revenue
• Consolidated Revenue from Operations for FY21 reported a degrowth of 24% YoY to Rs. 18,418 million as
compared to Rs. 24,379 million in FY20 PAT Margins (%)
(Rs. Mn)
• Growth for FY21 was subdued due to:

- Business from the HoReCa segment (Hotel, Restaurants and Catering Channel Partners) was impacted 77.9%
during the year due to lockdowns across the country during the year. 937 EBITDA% PAT%

- A large part of our Liquid Milk is distributed through Modern Trade channel and due to pandemic
8.7%
situation and subsequent lockdowns, Modern Trade channel was highly affected as well as there has
been shift in consumer buying behaviour from these outlets, leading to lower revenues. 6.8%

207 3.8%

Gross profit 1.1%

• Gross Profit for FY21 stood at Rs. 4,799 million as compared to Rs. 6,232 million in FY20.
FY20 FY21 FY20 FY21
• During the year, the prices of milk increased post easing of lockdown restrictions after first phase and peaked in
Q4FY21.

EBITDA Product wise Revenue Breakup 12.8%

(%) 15.0%
• EBITDA for FY21 stood at Rs. 1,248 million and EBITDA Margin stood at 6.8%
18.6% 10.0%
• With operating leverage to playout, we expect our margins to improve once our revenues come back to
normalcy. Skimmed Milk Powder

Liquid Milk

PAT Milk Products

73.0%
• PAT for FY21 stood at Rs. 207 million and PAT Margin stood at 1.1% in FY21. Others 67.4%
5.6%

1.2% 2.0%
FY20 FY21

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Parag Milk Foods Limited Focused on essentials. Optimised
Wholesometo grow.
living Corporate Overvies
Corporate Overview Statutory Reports Financial Statements
Financial Statements

We are Parag
Milk Foods
Back in 1992, when the foundation stone deliver the goodness of milk to our
of Parag Milk Foods was laid down by consumers in the most innovative
India’s new-age milkman and a visionary, manner. Also, driving up the value chain
Mr. Devendra Shah, who was already we have entered into the high potential
prepared to charter a path less travelled lactose market that would strengthen
in the dairy business with emphasis on our health and nutrition portfolio. Our
reinvention, innovation and diversification processes are a perfect blend of modern
of simple milk into innovative products. and traditional practices wherein we
The mundane business of dairy was use the state of the art equipment and
given a complete new direction and the manufacture products of quality par
company eventually emerged as one of excellence.
the leading dairy companies with a highly
diversified business flaunting a portfolio Our flagship brands Gowardhan and
of more than 10 consumer-centric Go, promise our patrons a perfect
products, which are made of 100% cow’s amalgamation of nutrition and taste
milk that has immense health benefits. with a gamut of products like ghee, fresh
milk, paneer, varieties of processed and
Moreover, our consumer-centric natural cheese, cheese spreads, slices,
approach focussing on nutrition, good sauces, butter, curd, dairy whitener, UHT
health and overall well-being has helped milk, milk beverages and Gulab Jamun
us to grow from strength to strength and mix. further our premium brand ‘Pride
further fortify our position in the domain. of Cows’ is based on the farm-to-home
We put an impetus on 100% cow’s milk, concept and offers premium products like
which is much healthier milk and have whole milk, Fat-Free Milk, Curd and Ghee.
built a strong brand base with our value- With this, we cater to the niche consumer
added products like ghee, milk, paneer, segment.
cheese, beverages, curd and Whey
proteins. Avvatar is our premium brand under
our rapidly expanding health and
Over the time, we have worked on nutrition portfolio, geared towards
building a robust brand proposition by health enthusiasts, youngsters and
not only leveraging our core functional sportspersons among others. ‘Avvatar’
areas via technology, application of is the only truly made-in-India whey
research and development but also protein brand and the first to provide
innovation in the domains of product home-grown whey proteins that are
development and enhancement. 100% vegetarian enriched with all-natural
flavours. It includes several variants such
Equipped with the best global as Isorich, Muscle Gainer, Mass Gainer
infrastructural practices, we have and 100% Absolute Whey Protein. It
state-of-the-art automated UHT, Whey also includes Avvatar Rapid, our whey-
Processing, Lactose manufacturing, Milk fortified hydration drink – a category-first
Drying, cheese and ghee manufacturing in the country.
facilities in place. Further, we seek to

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

We stand for Our presence

1 One of the largest dairy FMCG player with

largest value added milk products portfolio

Jammu

2 Leader and pioneer in the cow ghee

category under the brand Gowardhan Jalandhar

Parwanoo

Sonipat Facility
Haryana
Karnal

3
Dominant Cheese player with
Delhi
35% market share

Jodhpur Jaipur Siliguri

Kanpur

4
Patna Guwahati
Owner of one of the largest & most
Udaipur
advanced cow farm in india
Ranchi
Ahmedabad
Indore
Kolkata
Surat

5 Pioneers of the concept of Farm-to-Home

Premium dairy brand- Pride of Cows Nagpur
Raipur
Cuttak

Manchar Plant
Pune
Hyderabad
Bhiwandi
India’s 1 company to launch truly made
21
st

6 in India B2C Whey protein under the

brand “Avvatar”
Vashi & Vasai
Depots
Goa
Palamaner Plant
Andhra Pradesh
200 +
Superstockist
7 Large state-of-the–art infrastructure with
end to end integration
Chennai

3,000 +
Bengaluru
Andaman & Nicobar
Calicut distributors

8
Strong distribution channel covering Depot
3.5 lakh retail touch points 3.5 lakhs +
Super Stockist
Retail touch
Points

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

Our Mission

Our Consumers Dairy innovation

Should be able to trust our Focus on dairy innovation,
brands. This is why food quality enables us to produce an array of
is a fundamental requirement for products that make milk moments
Parag. We make every effort to nutritious, healthy, and enjoyable
ensure that our processes are safe, and we market them under a well-
and the high-quality standards are targeted portfolio of brands.
maintained throughout the supply
chain

Our Vision
Our aim is to keep hearts healthy, provide nourishment, and connect to consumers
through fresh and high-quality value-added products manufactured from 100 % cow’s Partnership with the Good citizenship
milk by partnering with the farmer community. In line with the long-term trends and dairy farmers We want to influence the
evolving consumer habits, we aim to launch market-leading products and create We are working with dairy farmers development of society and set
to enrich their lives and set new an example through our best
categories that are ahead of the industry, while continuing to build a strong health standards for sustainable dairy practices. As a large private
and nutrition portfolio. We ensure to create long-term stakeholder value by building a production. We aim to use our sector dairy player, we have the
sustainable business model while acting through our empowered employees. resources sustainably by having a opportunity to do so.
long-term environmental strategy.

Building a long-term
relationship with local
communities
We strive to uphold respectful and
constructive community relations
and contribute to the development
of communities by building long-
term relationships with people,
businesses and organisations.

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

Our wholesome Supply and distribution

approach
We cascaded our learnings from the Prism model and identified outlets
operating in each locality, implemented direct calling of retail outlets through
tele-calling model, taking their orders over call and replenishing their stocks
within 24 hours through fully integrated software to reach out targeted
outlets within a short span. In areas with limited retail outlets being open, we
also implemented direct order taking from consumers and home delivering
Our strength lies in our resilience products to them as well as placing vans with products at various housing
societies to make products available to consumers during these tough times.
and during the year we have further In order to incentivize our supply chain partners, transporters & sales team
-special arrangements were made for their safety and comfort, including the
strengthened our position arrangement of food and refreshments along with the general sanitization

by building on : facilities. We ensured that drivers of all transport vehicles were provided
with enough food for their entire journey and reciprocal arrangements were
made at their destination for stay, food and safe movement.

Novelty and enrichment

Brand identity
We seek to be resilient and enterprising so as to ensure the viability
Over the years, we have relentlessly worked on creating and longevity of our brands, we are known for our innovations.
greater value propositions by the way of value addition and Our innovative mindset expands much beyond creation and value-
innovation. Our products under the brands, Gowardhan addition and we seek to deliver products with an assurance of
which includes traditional Indian products and Go, which qualitative excellence. We also seek to grow in the said market
incorporates higher value-added and modern products are for which we are relentlessly working towards building a robust
well-placed in the market and have impressive clientele. system equipped with technical know-how focusing on product
Whilst Avvatar-whey protein caters to the sports nutrition enhancement.
segment, Pride of Cows targets the premium market and
offers farm-to-home fresh milk.

During FY’21, we focused on fortifying our position in

core products, Gowardhan Ghee, Gowardhan Paneer, Go
Cheese and Avvatar – Whey protein and with our strong Strengthening the reach
business model we were able to achieve one of the highest With a focus on core categories, like cheese, ghee, fresh products, beverages, we are working on further fortifying our position
ghee sales in summer and cheese sales in winter. The in the metros and Tier-I cities more while identifying certain specific portfolio-based demand clusters. In order to strengthen our
fiscal also witnessed few launches under the brand- Pride position, we are working to strengthen the distributor and stockist base to achieve higher retail penetration. Furthermore, to
of Cows- Pride of Cows Ghee and Pride of Cows Curd. enhance our presence in tier III cities, we are working on introducing low unit price products that can be consumer-friendly.
While, under the brand – Gowardhan – Star Cup Dahi and
Gowardhan Grated paneer were launched.

In order to increase brand visibility, we have been working

on marketing campaigns and consumer engagement
initiatives. We employed mix of traditional as well as new
age platforms –to promote our products.

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Our milestone years

We have been in the dairy business for more than two decades and our brands are
testimony of our relentless effort towards creating a better brand value and products that
are quality par excellence.

Since the day of our inception, we have been working towards giving our patrons a taste of healthy and wholesome
living through our milk and its value add products. Our persistence towards excellence and giving quality service to our
consumers have led us to create superior quality products of high nutritive value on the back of a strong network of
relationships in procurement, distribution and world-class infrastructure. The value proposition which we have created has
gone on to benefit the farmers, shareholders and consumers alike. We can trace our journey towards ensuring wholesome
living way back into our millstone years:

2020
Expansion of the premium brand offerings –
Pride of Cows Ghee and Dahi with the aim
to take the brand at the national level.
Commissioned Lactose facilty with a
capacity of 40mt/day.

1992 1998 2018

Parag Milk Foods was founded by Commissioned Value added Established the third
Mr. Devendra Shah. It is strategically plant at Manchar manufacturing facility in
located in the milk belt at Manchar, started production of ghee Sonipat, Haryana, which was
Maharashtra and initially procured mere and butter under ‘Gowardhan’ acquired from Danone
20,000 lit milk per day brand

2008 2005 2017 2016

Commissioned Go Cheese Launched Bhagyalakshmi Dairy Entered the consumer Parag Milk Foods
world, India’s largest cheese Farm, india’s most advance farm business of 100% Whey Limited got listed on
manufacturing plant with equipped with state-of-the-art protein with the brand the bourses
capacity of 40mt/day technologies Avvatar

2010 2011 2014 2015

Palamaner plant was Launched the brand- Pride of Cows- A first of Realizing the need of Launched the Corporate
established with world its kind premium farm to home dairy brand. market & to add further identity- PMFL Logo
class UHT facility
value, Launched Whey
Products for ingredient
usage

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

Our Wholesome
offerings Gowardhan Ghee
Gowardhan Ghee which has been our flagship product for decades has the credit of being a

In a bid to give our patrons a good taste of health and nutrition category creator and market leader.

and promote wholesome living, we are consistently working While preparing Gowardhan Ghee, we have been mindful of the procedure and adopted
traditional ways that helped us keep the taste and aroma similar to that of homemade ghee.
towards expanding our portfolio. We have a series of products
that are of high quality and are classified under:

Gowardhan Butter
Butter is used widely in Indian
households and through our
offering, we have tried to further
enhance consumer’s experience.
Gowardhan Butter is a table
butter, marked by a distinct lactic
taste and is made of clean and Gowardhan Dahi
Gowardhan Swarna wholesome cream that is derived
Important for maintaining gut
Catering especially to the from 100% pure cow milk. With
health and a natural source of
southern region of the country, no added flavours, colours
probiotics, Curd is consumed
Gowardhan Swarna, is a variant and ingredients, the butter
extensively in India and is also a
of Gowardhan Ghee and is is delicious, clear and light in
staple of many Indian cuisines.
texture, and has low salt content.
Gowardhan steadily expanding its footprint Our Gowardhan Dahi caters
in a market that has cut throat to the needs of the masses by
One of the first brands to be launched, Gowardhan, signifies bliss of wholesomeness and healthy living. The name,
competition. It has managed to making curd from pasteurised
‘Gowardhan’, can be broken into two words ‘Go’, which means ‘cows’ and ‘vardhana’ signifies nourishment. In all
create a place for itself among cow milk in a traditional
its forms, the brand has managed to win the hearts of our consumers. It has further diversified itself into a wide
well-established players with its manner. It also contains active
range of products like ghee, paneer, curd, butter and dairy whitener replete with 100% cow milk. 100 percent purity and unique culture and has a unique taste
taste profile. profile and good texture.

Gowardhan Milk
With multiple variants such as Gold, Pure, Fresh and Tea Star, the brand has established itself as a reliable name in the
market., Gowardhan Gold and Pure signify full-fat cow’s milk, Gowardhan Fresh (toned milk) and Gowardhan Tea Star
satiate the taste buds of tea and coffee enthusiasts. Gowardhan Tea Star is expressly formulated milk that assures better Gowardhan Paneer
taste, aroma and frothing of coffee and tea. Besides, the range also includes ‘Fit n Lite’ milk and skimmed milk that caters A rich source of protein, Paneer, is loved by vegetarians and non-vegetarians alike in India.
to the needs of calories conscious drinkers. We also have Buttermilk & Curd in this portfolio. It has a strong base among vegetarians and is the third-largest segment in the milk-based
products category. Seeing the strong demand, we were first to introduce Gowardhan
Paneer, which is a fresh Paneer from 100% cow’s milk with a very long shelf life of 75 days
in the country. With the application of technical know-how and innovation, we created
classic blocks and cubes, thus, making them easy to be handled.

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Wholesome
source of good health
and well-being
Go Cheese Go Colo Power
A completely vegetarian option, such as Gouda, Monterey Jack, We developed ‘Go Colo
Go Cheese is an ideal source of Colby, Orange Cheddar and much Power’ a patented product
protein for both meat-eaters and more. ‘Go Cheese’ spreads are also formulation, with a unique
people on a plant diet. It has a flavoured with herbs and olives, value proposition, which is
distinct taste and is available in four types of peppers, smoked composed of the first milk
75+ Stock Keeping Units (SKUs). paprika, jalapeno and garlic. of cows - Colostrum. This is
The product is available in several available just after calving. It
shapes sizes, formats and flavours. In addition, we have also come is extremely high in nutrition
It is available in the shape of up with distinct variants like and a potent immunity
blocks, slices, wedges and cubes. ‘Go Cheese processed Angles’, booster. Available in the form
While spread and sauces are the ‘Go Cheese Jalapeno slices’, of powder, ‘Go Colo Power’
formats created for customised ‘Go Cheese Four Cheese Blend’ can be consumed by mixing
Go brand usages, the flavoured cheese slices and ‘Go Cheese Pizza Blend’, an into various food items such
Drawing inspiration and its name from ‘Gowardhan’, our brand ‘Go’ is an are available in various flavours of assortment of cheese that can be as porridge, soups and more.
embodiment of all the good things and is replete with the elements of good health green chutney. Various types of used in various types of cuisines
and well-being. We have taken care of the needs of consumers looking for a higher ‘Go Cheese’ include mozzarella, from across the world.
degree of comfort and convenience. cheddar and gourmet cheeses

Go Buttermilk and Lassi Go Badaam Milk Go Fresh Cream Go UHT Milk

Popular Indian drink during summer, buttermilk and lassi are Added with a rich mix of Milk creams are widely used in desserts both The sub-brand contains several variants that have different fat
common man’s favourite, and are used widely as digestives. almonds and saffron, ‘Go Indian and continental cuisines. Our product content levels. While ‘Go Supremo’ has 3.5% of fat content
Go Buttermilk and Lassi are available in tetra packs, having Badaam Milk’ is a health with its moderate fat content is the user’s and is rich and creamy in texture and can be ideally used for
long shelf life and are hygienic. Go Buttermilk, garnished drinker’s delight. The milk is favourite and has rich nutrient content. It is a making sweets and desserts, ‘Daily milk’ is relatively low in fat
with ginger and cumin, is available in two flavours – Masala replete with nutrition and heathier alternative to cream derived from plant content, i.e.,1.5%, easily digestible and contains all the nine
Chaas and Southern Spice, whilst ‘Go Lassi’ is available in two matches the quality of a potent fat. Free of preservatives, these are available in amino acids. The type ‘Go Slim Milk’ with 0.2% fat is high on
delightful flavours of Rose and Mango. immunity booster. tetra packs and have a shelf life of four months. health benefits and assures goodness of milk sans fat.

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Reconstructing Alpha Whey

• The purest and the freshest premium duo-protein blend

Never Stops
• Packs the power of fast absorbing, best-in-class whey protein
• Enriched with casein, a sustained releasing milk protein, for energy that lasts all day.
• Scores high in PDCAAs
• Provides 20g of protein per scoop, as well as 3.5g of BCAA and other Essential Amino
Acids, along with 22 important vitamins and minerals

At Parag Milk Foods, we have used our extensive expertise in 20g Protein, 3.5g BCAA, 3.5g other EAAs, 2g, Glutamic Acid
the dairy industry to enhance the nutrition factor in your journey
of strength, by bringing you Avvatar. A premium sports nutrition
supplement brand that we make in our own, and India’s one and Muscle gainer
• Healthy balance of protein
only, Whey Protein Plant. Right through its journey from our and carbohydrates to help you

state-of-the-art dairy farm to your shaker cup, Avvatar stays fresh gain lean muscle mass
• Protein carb matrix of 1:1 that
and pure. Processed from fresh milk within 24 hours, and sealed is a blend of Whey Protein
Concentrate, Whey Protein
in jars with their own authentication labels, there’s nothing like it Isolate, Casein, Maltodextrin
and Dextrose
to give you the performance and strength you need, in order to • More protein content than

reconstruct yourself. most muscle gainer brands,

with each scoop providing
Mass gainer 50% of the RDA requirement Rapid
• Ideal protein-carb matrix of • 21 vitamins & minerals to • Provides instant and sustained
1:3 with Maltodextrin, Whey enable the right growth and energy, and ensures enhanced
Protein Concentrate, Isolate providing 50% of the RDA in a delivery of vital nutrients to
and Dextrose, especially single scoop
Isorich muscles through a perfect
designed for Indian consumers • Unlike most popular brands, blend of sugars
• Freshest and purest Whey Isolate in the country • Made from 100% cow’s fresh sugars are replaced with a • Instantly replenishes lost
• Premium 100% Whey Protein Isolate that gets rapidly absorbed in your digestive milk, giving you a healthy good source of carbohydrate electrolytes due to sweat loss.
tract, allowing quick delivery of all essential amino acids balance of the freshest blend that helps grow lean muscle Helps prevent muscle cramps,
• Delivering 28g protein per scoop - one of the highest in the category of protein and carbohydrates gains instead of mere body fat fatigue and poor exercise
• High in naturally occurring BCAAs and EAAs that support rapid muscle protein synthesis to help you gain mass the gains performance
• Designed for people who are lactose intolerant, strict calorie watchers and right way • Designed for individuals • Loaded with high quality
conscious about the quantity of carbohydrates • Two scoops of 60g offer the aiming at growing lean Whey Protein Isolate, which
highest protein (45.6g) in the muscles by providing an extra has naturally occurring
28g – Protein, 6g, BCAA, 6g, Other EAAs, 3.8g Glutamic Acid mass gainer segment along push of nutrients to achieve essential amino acids to
with 122g carbohydrates goals promote muscle protein
• 100% RDA of 21 vital vitamins
synthesis
and minerals in two scoops to
• Enriched with Vitamin C that
enable the right growth
supports immunity and helps
Whey protein • With no added sugars all the
fight oxidative damage caused
• Freshest & purest Whey Protein blend in the country proteins and carbohydrates
during intensive training
• Premium blend of Whey Protein Concentrate and Isolate for building strength are derived from quality
and enabling muscle repair sources to meet the ideal
• Naturally occurring BCAAs and other EAAs for promoting protein synthesis protein carbohydrates ratio
• Contains naturally occurring milk calcium for maintaining good bone health 25.5g protein, 24g carbohydrates, 149kcal, 611mg Electrolytes,
• Natural fibre to support healthy metabolism, digestion and gut health 5.7g BCAA, 4.3g Glutamic
828kcal calories, 45.6g protein, 1300mg BCAA, 5900 mg,
122g carbohydrates Acid, 21 Vitamin & Minerals Whey Protein
27g PROTEIN, 6.1g BCAA, 6.1g OTHER EAAS, 3.9g GLUTAMIC ACID

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

Our premium Our wholesome

offerings- offering for every
Pride of Cows strata
Our diverse product portfolio
Originating from Bhagyalaxmi Dairy Farm, Pride of Cows, is premium caters to consumers from
milk for the uber-luxury consumers. It is a niche product delivered different segments:
directly to the consumer’s doorstep. A first-of-its-kind superior farm-
to-home product, Pride of Cows, has an impressively fast-growing
Premium
‘Avvatar’ & ‘Pride of Cows’
clientele expanding on the back of its powerful value proposition. One • N
iche household consumers seeking
premium quality dairy products
of the salient features of the product is that it is not touched by human • Health enthusiasts

hands and is an ideal example of hygiene and health.

Pride of Cows curd

Pride of Cows Milk
The Pride of Cows Milk is exceptionally clean
and low in bacterial count, which makes it a
Pride of Cows curd will have
a thick and creamy texture, Modern: ‘Go’ Modern
high on protein and calcium. • Children and the youth primarily
healthy alternative. This milk needs no boiling It is made from milk which is a for direct consumption
and is high in nutritional value, specially first-of-its kind superior, • On-the-go consumption as a
packaged, carefully handled and hand source of instant nourishment
Farm-to-Home milk that
delivered to the consumers door-step every caters to the demand of
morning. Pride of Cows bears a distinct flavor consumers who believe in
of delicious full bodied milk, which is richer leading a healthy lifestyle and consuming natural and
and creamier than regular milk. pure products

Fat Free Milk

Pride of Cows fat free milk is produced
Pride of Cows Ghee Traditional
Pride of Cows Single Origin Ghee is
and packed at bhagyalashmi Dairy farm.
made to achieve the perfect balance Traditional: ‘Gowardhan’
The milk is highly nutritious, fresh and
of aroma and smooth texture. It is • T
raditional Indian recipes
unadulterated. The Pride of Cows Fat- and cooking ingredients
being done to ensure so that the
free milk promises to be tastier and full
consumers experience all the goodness • Indian households
of natural goodness without the burden
of ghee. Single origin makes this ghee
of milk fats. Furthermore, the product will
differentiated from all other ghee in the market . The
be adulteration free, untouched by human
product promises Taste that is distinct, Texture which is
hands and will be delivered fresh through
smooth and Aroma which is perfect.
the company’s Farm-to-Home business
model.

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

All about our Our production capacity

manufacturing 3.4 Mn litres/day

Milk-Processing Capacity
10 Lakh litres/day
Whey Processing
110 MT/day
Ghee

60 MT/day 20 MT/day
Cheese Paneer

Manchar, Pune, Maharashtra Sonipat, Haryana

PMFL established its first manufacturing Acquired from Danone Food and
plant in 1992 in the milk belt of Beverages India Pvt. Ltd., the Sonipat
Manchar. Raw milk collected from dairy facility commenced commercial
farmers is pasteurised here, to be used operations in August 2018. This
to manufacture curd, paneer, ghee, acquisition was a strategic investment
cheese, beverages, and more. Go Cheese in strengthening the Company’s fresh
factory too is present here. category products distribution in the
North regions of India. Through this plant,
the Company supplies fresh products such
as milk, curd, buttermilk, and flavoured
milk to the markets in the North of India.

Palamaner, Andhra Pradesh Bhagyalaxmi Dairy Farm

stablished in 2010 at Palamaner, Andhra Bhagyalaxmi Dairy Farm with over
Pradesh, this plant helps PMFL cater to 35 acres of land and 2,300 Holstein
markets in South India. It is equipped Friesian cows – the most modern
with state-of-the-art UHT technology. farm in India with state-of-the-art
equipment and best practices of animal
management.

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

Our Lactose
Plant
To add further value to our large cheese
and whey business, we have entered
into a high potential Lactose business.

We have expertise in dairy ingredients maintaining the highest standards of

which has allowed us to create lactose quality and delivery throughout.
that is ideal for multiple segments such
as food applications, infant nutrition Our best practices and state-of-the-art
and clinical nutrition products infrastructure make it the partner-of-
We have commissioned a Lactose choice for leading MNC players and
Plant with a capacity of 40 MT/day. is thereby confident of reaping the
Through the commissioning of this benefits of further value addition in
plant, we now intend to add higher our Health & Nutrition business
value to Whey Permeates that are
generated during the filtration process Indian lactose market size is ~40,000-
of whey protein. 45,000 MT and is valued at INR 5,000
million (~USD 70 million), with a major
We have a fully integrated value part of the requirement being met
chain with control over key processes through imports. This provides a huge
from procurement and supply chain opportunity for import substitution for
to processing and distribution, players like us that are equipped with
end-to-end manufacturing capabilities.

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

The future of
dairy farming
Bhagyalaxmi Dairy Farm is India’s most modern
dairy farm, spread over 35 acres and equipped
with the finest international technology. The
facility also features a well-equipped scientific
laboratory, R&D centre and research farm. It is
home to ~2,300 Holstein Friesian cows.
Situated in Pune, Maharashtra, brand of premium packaged milk that is
the Bhagyalaxmi Dairy Farm was untouched by human hands. The entire
established in 2005 followed by the process of feeding and milking the
Bhagyalaxmi Bioscience Division, in cows and the processing of fresh milk
2015. It is an industry-first concept is completely automated. The service
that brings farm-to-home premium is currently available across Mumbai,
fresh dairy consumables to the Pune, Surat and Delhi. The farm has a
consumer’s doorstep, where the unique subscription-based model, with
distribution is owned completely delivery monitored through a dedicated
by PMFL. Bhagyalaxmi Dairy Farm app, designed for specific, targeted
was established as a Research and consumer audiences, maintaining
Development centre for studying extremely high-quality standards.
and developing best practices for
cattle feeding, breeding and livestock Bhagyalaxmi Bioscience Division
management. The objective was to studies various formulations for
use this knowledge to help improve quality cattle feed to improve milk
milk yields on farms owned by our yields as well as sustainability. It also
farmer partners. It is a wholly-owned ensures waste matter is converted into
subsidiary of PMFL. useful marketable material, such as
manure. Our farmer partners buy it to
With time, it took shape as India’s organically boost their farm yields. The
largest and most technologically facility has its own biogas plant with
advanced dairy farm. It became a 600 m3 power generation capacity,
unique concept offering in its own which converts gas fit for captive
right, in the form of Pride of Cows, a consumption.

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

Our consumer
CONSUMER ENGAGEMENT PROGRAMME

engagement drive
NEW PRODUCT LAUNCH CONSUMER
OFFER

Appointed ace Bollywood celebrity Kareena Kapoor Khan for our premium, subscription based, Farm-to-Home brand ‘Pride of
Cows’. Collaboration has helped enhance the brand’s reach and increase awareness amongst consumers that are looking for
quality, fresh and pure products.

Pride of Cow Ghee Pride of Cows Curd

Pride of Cows Single Origin Pride of Cows Curd – Full of
Ghee is made to achieve the Love’ is made from pure Pride of
perfect balance of aroma and Cows milk which is unmatched
smooth texture to ensure that in its quality and freshness.
our consumers experience all the
goodness of ghee.

Pride of Cows Fat Free Milk

Sent out hampers to A lister Influencer with a note from Kareena Kapoor
With Pride of Cows fat free milk,
to create the Buzz around Brand Pride of Cows and Kareena Kapoor Association
we aimed to provide alternatives to
consumers seeking all the goodness of
Pride of Cows without fats.
#Raiseaglasstothetasteofpurity #Prideofcows MOTHER’S DAY ACTIVITY
Go Cheese salutes to the apron clad worriers on the
Double Dhamaka offer for consumers occasion of Mother’s of Day
Go cheese slice free with 200 gm
Gowardhan Paneer

We have launched ‘Star Cup Dahi’ Provide pre-shredded packaged

through the Liquid Milk channel in paneer for HoReCa & Institutional
Mumbai & Pune consumers to drive optimization in
paneer value chain.

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

GO CHEESE LOVER’S DAY CELEBRATION BRAND AVVATAR

Our Flagship propery “Go Cheese Lover’s Day Celebration with #HarTastyCheeseMainGoCheese #Gocheesytwister

INFLUENCER ENGAGEMENT:

Enage with Influencers As Avvatar was truly made in India whey protein brand we have launched the campaign #truelyindianbrand
to promote the campaign
#HarTastyCheeseMainHaiGoCheese
TVC
Launched new communication for brand Gowardhan keeping in mind the YOUTUBE CAMPAIGN
current consumer mindset of being health conscious- Gowardhan- Raho
Semantmand. We ran this campaign along with our leading communication
“Pyar ka Rang Sunehara” on Television.

GENERAL ENTERTAINMENT CHANNELS ‘Har Tasty Cheez

Mein Go Cheez’
We have taken sponsorship on ABP Youtube campaign has reached
Majha to promote brand during more than 4 crore target audience,
Ganesh Chaturthi. with a unique reach of more than
1.4 crore during campaign.

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

Navigating through
the COVID-19 crisis
The COVID-19 pandemic challenged us
in many ways, however, we remained
resilient throughout and lent a helping
hand to our stakeholders and the
society as a whole.

We continued to support our most

trusted partners, dairy farmers, ran
uninterrupted operations, took efforts
to make our supply chain hassle and
interruption free.

Besides, we continued to serve people

during the pandemic by distributing more
than 1500 COVID-19 kits to protect
healthcare warriors, regularly sanitised
In order to keep our employees within our facility to ensure real-time We remained grounded with our sales
and supplied drinking water to the
motivated during the tough time, availability. team, adhering to guidelines without
villages, and got people vaccinated, etc.
we rewarded them with daily cash compromising on our reach and
incentives, ensured them home- Where the last mile delivery and the availability of our products.
We were always mindful of and caring
to-plant safe mobility solution and logistics was impacted, we came out
about our farmer’s socio-economic
during the pandemic but also have a This helped us manufacture our quality provided them 100% safe working stronger and left no stone unturned We re-strategized our marketing
well-being and continued procuring
continuous source of livelihood. products without disruptions and conditions. This was done so as to to ensure that our products reach the channel mix and engaged our
milk from them during the crisis. we
ensured continuous supply of products ensure smooth availability of manpower shelves on time. We took 100% care consumers via the digital route.
stayed afloat with them and took
Moreover, with higher milk coming in to our consumers during the period. even during the peak crisis. We of the transporters and supply chain
care of all our commitments and went
from the farmers during these tough provided free food to all our workers partners to ensure that timings are
beyond it wherein we procured milk
times, we ensured that our facilities ran Due to high raw material, we continued and during pandemic time, extended adhered to.
almost 30% higher than the normal
average at a fair price to ensure their smoothly and was utilised to the full to manufacture semi finished goods to the free food facility to community
sustainability. This helped them to not capacity adhering to all the COVID led be used to meet future demand. around the area affected with pandemic
only become financially empowered precautions and SOPs in place. as also taking care of people.

We quickly adapted to the changing

and the challenging environment
towards procurement of Packaging
material from our vendors due to the
closure of many of their operations. We
worked closely with local authorities as
well as industry players to re-activate
our regular vendors by identifying
alternate sources and locations to
ensure supplies.

We went the extra mile to ensure

continuity of our operations by offering
our location to crucial suppliers to shift
their equipment and produce material

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

ESG update
As a leading Indian player in dairy based food,
nutrition and wellness sector, we have been
raising the bar in Environment, Social and
Governance progress for the Indian Dairy and
FMCG industry. We have been harnessing the
best available technology, talent, social equity
and our sense of trusteeship in view of millions
of cattle and milk producing farmers working as
our extended family.
Our environmental focus centers As we solidify our ESG foundations
around reducing the carbon footprint towards creating a business enterprise
(energy management, emissions) of tomorrow, we are fast developing
and an optimal waste management. an ESG mindset, putting newer policies
Whereas our social focus spans across and frameworks, integrating various
the socio-economic well-being of our aspects of this thinking into the design
milk farmers, employees, distribution processes while overhauling our entire
partners and the community at large. business value chain. The relative
Our governance framework, in line with inertia that the pandemic brought into
the evolving global ESG best practices, our business in FY21 was utilized to
is transcending the usual corporate strengthen our ESG foundation. And
governance to also encompass business PMFL undertook many a transformative
governance, talent governance, and baby steps towards its committed ESG
sustainability governance. journey during the year.

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

Some of the highpoints of our ESG progress in FY21 are presented here in form of data and graphics.
IFC policy highlights
A solid foundation We are following IFC and World Bank’s Environmental, Health, and Safety (EHS) Guidelines. Some of the key highlights of the policy are
Adhering to IFC ESG Framework for accountability - based values b. Environment Management Governance Guidelines: General Facility Design and Operation
aiming, improving and reporting on form the basis of our philosophy System under ISO-14001
• Adoption of World Bank’s “Corrupt Practice”, “Fraudulent Practice”, • Communication and Training
our environmental and social progress for Corporate Governance. c. Energy Management System “Coercive Practice”, “Collusive Practice” and “Obstructive Practice” • Physical Hazards
for the last 8 years has set a robust c. We believe that good Corporate under ISO-50001
foundation for us to lift our ESG Guidelines
Governance is a continuous d. Organisational Health & Safety • Chemical Hazards
reporting to the next level. In spite of process and strive to improve • Adoption of World Bank’s Guidelines on restricted practices
Management System (OHSAS) • Biological Hazards
COVID-19 disruptions and restriction the Corporate Governance including Child Labour, illegal & restricted activities, weapons,
under ISO-18001
characterizing FY2020-21, we are practices to meet shareholder’s tobacco & alcohol, wildlife products, Intellectual Property, • Radiological Hazards
happy to report marked progress in our expectations. Information Technology, etc. • Personal Protective Equipment (PPE)
3. Best Practices of Societal
ESG performance during the year.
d. In terms of Section 135 improvement through various • Adoption of World Bank’s Guidelines on not dealing with UN • Special Hazard Environments
of the Act, Our Board has CSR activities (Further details are sanctioned Nations, entities & practices.
Our ESG Policies are centred around • Monitoring
constituted the Corporate Social available in separate CSR section)
following pillars: Environmental Guidelines – This guideline cover all the aspects of
Responsibility (“CSR”) Committee, Community Health and Safety – These set of
and further, we have also created 4. Adoption of practices for food environment preservation and includes the following areas guidelines complements the guidance provided in
1. Adoption of strong Corporate
a Board sub-committee for Risk security & climate change under • Air Emissions and Ambient Air Quality the preceding environmental and occupational health
Governance standards
management from this year and UN Sustainable Development Goals • Energy Conservation
a. We have recognized and adopted and safety sections, specifically addressing some
shall be forming more robust (SDGs) including;
strong corporate governance • Wastewater and Ambient Water Quality aspects of project activities taking place outside of
policies and processes in this a. Strict anti-biotics policy at our
as a pre-requisite for meeting regard ahead. • Water Conservation the traditional project boundaries and includes the
farm as well as milk received following
the needs and aspirations • Hazardous Materials Management-
from farmers
of our stakeholders which is 2. Adoption of ESG Systems: Both • Water Quality and Availability
b. Strict policies on toxins, • Waste Management
established by the application our major plants viz. Manchar &
insecticides, etc. meeting the • Noise • Structural Safety of Project Infrastructure
of best Management Practices, Palamner have following systems &
Compliance of Laws in true local standards • Contaminated Land • Life and Fire Safety (L&FS)
certifications in place:
letter and spirit and adherence c. Focus on renewable electricity, • Traffic Safety
a. Food Safety Management Occupational Health & Safety – Under these guidelines the company
to ethical standards for effective organic manure, etc.
System under ISO-22000 along- and the supervisors are obliged to implement all reasonable • Transport of Hazardous Materials
management and distribution of
with other certifications like precautions to protect the health and safety of workers. This includes
wealth and discharge of social 5. Adoption of IFC and World Bank’s • Disease Prevention
FSSAI, BIS, Export Inspection the following areas. Occupational Health and Safety.
responsibility for sustainable Environmental, Health, and Safety • Emergency Preparedness and Response
Agency (EIA), Halal, US-FDA,
development of all stakeholders (EHS) Guidelines.
etc. providing best practices of
b. Transparency, integrity, Food Safety.
professionalism and
An objective As a part of above, we are subjected
to regular audits and reporting
Environment
monitoring requirements meeting the standards
laid down in the regulations & policies.
stewardship
• Energy conservation efforts
framework Further, we are also subjected to Annual
Monitoring Report (AMR) by IFC.
We remain committed to environment
conservation while also ensuring
• Strict adherence and
• Well articulated – both thermal & Electrical occupational health and safety of our
measurement to the We have adopted global best standards
internal ESG policy in employing host of measures
The Environment Management employees while also being mindful
conservation norms and certifications for monitoring and
adherence to different • Water conservation efforts-
framework - We believe that a of safety of our consumers and the
• Zero water and land reporting our progress across a range
certifications Recycling of 55% of the
responsible and a growing business communities where we operate
waste norm of parameters and indicators. These
• Also abided by IFC’s requirement
along with prosperous society can within. We deploy and adhere to best
• Reduction in CO2 include Environment Management
policy framework on • Responsible Effluent and
only exist in a sustainable natural practices on preventing and restraining
emission levels System, Energy Management
ESG Waste management process
environment. We are committed towards environmental pollution.
(Scope 1 +2) of System, Organizational Health Safety
• Marked reduction in the
rejuvenation of the natural environment,
15% by 2025 Management System (OHSAS), Food
emission levels
going beyond compliance to greener As part of our environment
Safety Management System, and
business operations. Our goal is to stewardship, we have identified the
Corporate Governance Standards
preserve and enhance the environment environment aspects of our products,
(details captured in Corporate
via (a) Reduction of energy usage (b) processes and activities within the

Way
Governance Report). In addition to
Our ESG Performance
these systems and monitory framework,
Reducing carbon footprint/ adhering
to the emission norms towards the
defined scope of EMS that we can

forward
control, and also those that we can
framework
we lay special emphasis on full
decarbonization roadmap (c) Reducing the influence. We have mapped associated
compliance with all applicable SEB and
usage of Water and effective and efficient environmental impacts of those factors
PCB norms.
waste treatment process
Continuous monitoring
across their respective lifecycles.

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

Our Energy conservation drive continues to remain strong

Power Usage (KWh/Litre of milk) Power consumed(Kwh)/ per Kg milk powder
Manchar Manchar
0.103 0.20 FY20 FY21

0.089 0.19

Palamner Palamner
0.062 0.22

0.060 0.21

Boiler efficency levels (%) Thermal energy usage (Kcal)/ per litre milk
Manchar Manchar
68 1.80

80 1.75

Palamner Palamner
70 1.20

Energy responsibility 74 1.08

A PMFL, we remain committed to

improve our energy performance by
assess our current energy consumption
levels, set targets for future, device
• ETP bio-waste based gas generation
utilizing gas & also converting into Renewable Energy
way of setting, reviewing and achieving an action plan to achieve our targets electricity
Embracing climate change adoption, energy. For FY21, the total units Apart from that, we have utilised
energy targets in a continual manner. and keep repeating this cycle towards • Boiler-Steam based Turbine for and contributing towards greener generated from the same is biogas generated from ETP at both
We have identified all substantial continual improvements. Power generation planet, we have invested and would 2,428,320 Kwh. our plants to fire our canteens and
power consumption segment of our
We already have following renewable further continue to invest in renewable meet its daily fuel requirements.
manufacturing units and processes. We • We have also installed a biogas
energy projects in place: and clean energy sources.
plant to convert ETP effluent into • Further in June 2020, we installed
• Our steam based turbines converts biogas, which is used as electricity. a biogas based Genset plant in our
steam into electricity, thereby For FY21, the total units generated dairy farm- Bhagyalaxmi, which uses
FY21: Key initiatives FY22: Strategic priorities resulting in saving for electrical from the same is 327,602 Kwh, Cow dung to generate power.

• Installation of VFD on refrigeration compressors to optimize • Power generation through solar

power consumption
• Replacement of previous generation lightings with LED lights
• Energy generation through solid waste (press mud
of Sugar Industry)
Emission monitoring
• Use of ETP gas for power generation • Replacement of inefficient pumps We have in place a robust mechanism measuring CO2 emissions, Reduction in the CO2 emission /
• Installation of new technology (turbo compressor) refrigeration • Technology up-gradation of powder plants to make duly verified by an independent assurer. We have been able to litre of milk handled
system with COP of more than 5 more energy efficient reduce our carbon emission by 15% in FY21. We are in the process
of setting absolute and intensity targets (Scope 1 + Scope 2) to 0.32
• Replacement of old inefficient motor with new high efficiency motors • Further Heat recovery system in boiler (Flue gas
heat recovery) reduce emissions by 15-20% by our target year of 2025.
• Monitoring and control of excess air in boiler
0.19
• Installation of Bio-gas based electricity generator & further We have identified all substantial power consumption segment
improvement of 2.6 MLD ETP for Manchar plant of plant & made a close monitoring on consumption of energy &
• Control & online monitoring Of SOX & NOX fixed targets & action plant to achieve targets. Some of targets &
Aims to reduce emission levels by
• Replacement of Freon refrigeration system by 134 A refrigeration achievements are
system
• Installation of solid waste digester
(a) Use and replacement of the conventional electricity by Solar 15-20%
energy to 30-35% levels (b) Improvement in the boiler efficiency by 2025
levels.

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Parag Milk Foods Limited Wholesome living Corporate Overvies
Corporate Overview Statutory Reports Financial Statements
Financial Statements

Effluent treatment process Our Farm activities

• We also have Bio gas generation at dung to create customised manures Farmer specific social activities carried
In the process of Effluent treatment arena, there are various Water usage (litres) per litre milk our Farm for various crops out by us including conducting regular
initiatives undertaken by us like Manchar
• Bio-gas generation at Farm as well • We also undertaken Silage-making health check-up camps, awareness
• Zero-discharge ETP 1.80 programme on usage of natural &
as converting cow-dung slurry into of crops to preserve the shelf-life
• ETP-gas based power generation organic fertilisers of fodder as well as have greens for ayurvedic medicines against allopathic
1.75 cows through-out the year, etc for treatment of cattle, suggesting best
Water optimization – We have exercised utmost care to design, • We do addition of bio-active micro-
crops for their fields, usage of organic
deploy and maintain adequate Water & Waste water treatment nutrients and organisms into cow
Palamner fertilisers and its advantages, etc.
systems, to give required outputs at all the times. At each stage

Environment, Health and safety Management systems-

of design, we are taking minute details into consideration, 1.20
which can optimize the system. We have put in place three
step treatments namely Primary treatment, Anaerobic
Treatment and MBR treatment.
1.08
Continual training and awareness
55%
We are committed to protecting the maintaining good environmental conducted a total of 14 such training
Our water consumption per liter of milk handled has reduced Around Environment, Occupational Health and practices in all its activities. programs during the year across a range
over a period of time, and we remain committed to further Safety of our employees, consumer of aspects including Energy Efficiency,
of water consumption at our units
improve on this. and the global communities where we Train for awareness and re-train Chemical Safety, Fire Safety, PPEs,
is from recycled water operate. Prevention of Environmental for recall is our mantra for absolute Electrical Safety, Ammonia Safety, Safe
pollution by implementing & adherence to various ESG parameters Movement of Material among others
across our entire value chain. We

Our cattle care

Inorder to avoid use of antibiotics against contagious disease vaccination programme has been strictly followed. This helps us
to reduce the use of antibiotics and an extra stress coming from antibiotic. A standard vaccination programme has been strictly
followed for all dairy animals.

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Corporate Social Feeding

communities
Responsibility During covid pandemic,
PMFL has continued its
efforts to improve access
to the food and nutrition to
the needy so that everyone
should be fed with nutritional
meal and ultimately reach
their full potential. More than
3, 50,000 nutritional food
distribution for needy and
COVID patients.

More than

3,50,000
nutritional food distribution for
needy and COVID patients.

Responsibility is an integral part of PMFL and we always thrive to work

towards the betterment of communities and uplift their lives by our
diminutive efforts. we have and will always believe in the comprehensive
growth of society and try to bring positive changes in the surroundings
where we operate. As a responsible organization, we recognize moral, social
and business responsibility to protect, preserve & nurture human values
and also to promote socio-economic welfare. As CSR is in our DNA, we will
continue to enhance value and promote sustainable development of the
environment and social welfare society at large.

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

Health is More than 1500 Shelter of

wealth Distribution of COVID-19
Kits to protect healthcare Protection
COVID warriors

Regular Sanitization and supply

As COVID-19 sweeps Shree Poona District At Panjarpole, we take
of clean drinking water
across the world, all sectors
are being upended and it 6 villages Panjarpole care of abandoned
cows as they are
became utmost important to We contributed to “Shree unproductive or with
encourage mental wellness More than 400 Poona District Panjarpole”, lower yield. Our team is
to ensuring people are secure supply of grocery kits Asha where all cattle & animals are engaged in taking care of
with their daily needs. workers and frontline warriors accepted free of cost. We those cows and providing
have offered to nurture and them with good healthcare,
More than 10000 care for animals in distress nutritional food and
distribution of Sanitisation kits and to protect stray cows shelter.
& other stray animals. We
Provision of Vaccinations
for more than have borne the cost of daily

600 people feeding as well as housing of

these animals.

Healthcare and cancer

150
camps for more than cows are been taken

800 people care by 15-20

employees.

Our shared goodness legacy

In many ways, we have worked for the betterment of the dairy farmers , right from making them Empowering As a company, we have always helped students to realize their
empowered to providing them livelihood and financial security. students full potential by offering them cost-free quality education.

More than

300
farmer workshops taken to
educate them on best dairy
farming practices
Offering MS CIT
computer course
52 53
Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

Message from
Chairman
Building blocks in place; geared for growth
Dear Shareholders,

The last year has been a true litmus

While the pandemic impacted our and related restrictions, our fresh
test for all of us. It pushed us to Gowardhan Ghee, Gowardhan
financial performance, we continued milk and commodity business also Consumer centricity Sustainable Company
extremes and made us reimage lives Paneer, Go Cheese and Avvatar –
our operations with regulatory suffered, impacting our overall At strategic levels, we have been Keeping technology and innovation
and businesses to prepare for the Whey protein. Our concentrated and
approvals even during the lockdown revenue performance. evaluating our process to remove at the core, our Company has been
next normal. It was a year of care, single-minded approach on putting
phase being an essential service bottlenecks, strengthen brand image working on creating value-added
compassion and determination. muscle on our key chosen categories
provider. We also ensured that the Milk prices continued to display their and de-risk business to realise products for sustainable living.
health and safety of our employees upward journey, impacting our margins better value for our consumers and enabled us to achieve highest ghee As part of our ESG efforts, we are
Unlike the other crises in the world sales in summer and cheese sales in
at our plants was not compromised. and profitability. After peaking in business. As part of our plan, we are looking at alternate packing materials
which have been related to financial winter respectively.
We implemented standard operating Q4FY21, the prices have softened and building new products, capacities and for our products and also promoting
markets, this one has been much
procedures to maintain safety and stabilized in the last few months. markets keeping consumers and their the practice of reuse, recycle and
unknown and unaware and the Living by our tagline “Ideas for
hygiene at workplaces. evolving needs at the core. reduce. In a bid to go green with
world was taken by surprise with a new day” – we continued to
During the year, we continued reduced carbon footprint, we are
the speed and vastness of this bring innovative products for our
We continued to clock healthy our cost rationalisaiton efforts Wholesome living is an evolving idea working on renewable energy, better
sudden pandemic with health and consumers. We expanded our
double digit growth in our core to minimise the impact on the and catching up attention of people, wastewater management & reduction
nourishment taking the centre stage premium Pride of Cows portfolio
consumer value added categories. Company’s profitability. We also especially younger generation. It is of carbon emissions along-with
for all we do to live. by launching Pride of Cows- single
On the flip side, the demand from looked at adapting our distribution this evolving idea that has kept us areas like lower usage of chemical
hotels, restaurants and catering model and supply chain management busy and would define Parag Milk origin ghee, Pride of Cows - Curd fertilisers, antibiotics, etc.
The response to this sudden event and Pride of Cows premium Fat free
(HoReCa) segment was severely systems to suit the current situation Foods of future.
by the scientific community was swift milk to cater to discerning consumers
affected. Further, due to lockdown and prepare for the new normal During the year, we focused Way forward
and current fast paced vaccination focused towards health and nutrition.
on strengthening our brands - While the second wave of COVID-19
is a positive sign. We hope that we We are extremely delighted with the and newer variants of the deadly virus
all together come out of this World’s initial response and would continue continue to remain a concern for the
worst health crisis. to excite our consumers with our new
“We continued to clock bouquet of launches ahead. This year
world, our continued emphasis towards
empathy and business continuity will
On the business front, it has been healthy double digit with long shelf products like Ghee in remain the guiding force for growth.
a time of significant upheaval and a
test of resilience that strikes once
growth in our core our arsenal, we embarked our journey We remain focused on innovation
of taking Pride of Cows from metro and development of newer products,
in a century. Yet, it led us to adapt, consumer value added centric subscription led brand to a backed by in-depth research as we
re-orient and accelerate learning categories. On the flip national on the shelf brand look at the current times as hidden
while keeping the safety of our
employees and business partners, at side, the demand from Strengthened balance sheet- All
opportunities.
the forefront. hotels, restaurants geared towards growth We have focused on putting in place
In the month of May 2021, we raised
In these difficult times, we stood
and catering (HoReCa) funds through preferential allotment
the right building blocks for the future.
These include identifying our strategic
committed towards our – Farmers, segment was severely of equity shares, FCCBs,/Warrants priorities and categories, enhancing
as this uncertainty & lockdowns affected. Further, due to and other Instruments. This will help our distribution and product portfolio
resulted in demand destruction reduce the overall debt burden. The
posing a threat to their survival. At lockdown and related funds will also be utilized for meeting
and driving digital to name a few. With
these building blocks in place, PMFL
PMFL, we mounted a rapid response restrictions, our fresh our capex requirements over the next is well positioned for accelerated
in order to ease the farmers’ worries 2 years and would free up our cash
and extended support by increasing milk and commodity flows during that period.
growth. Going forward, building on
the foundation we have and executing
our procurement at the fair market business also suffered, on our strategies will be critical for
price. During the year, on an average Additionally, the proceeds shall be
our milk procurement increased by
impacting our overall consistent value creation for our
utilised to enhance working capital shareholders.
30-35%. We firmly believe that this revenue performance.” for future growth. We at PMFL
solidarity with farmers and trust ensure that this shall provide enough
will go a long way in firming our Yours faithfully,
firepower to bolster the balance
association with this most critical sheet and propel the company for Mr. Devendra Shah
part of our ecosystem. exciting growth ahead. Chairman

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

Message from
Managing
after the peak in Q4FY21 following We continue to work relentlessly to with thermal scanning machines
easing out of lockdown restrictions, invent cow milk products through and sanitisers, and also mandated
and are expected to remain stable on innovation and technology. Our the use of mask and maintenance of
account of good monsoons. offerings cover over 170 SKUs of value- social distancing during the period.

Director
added products such as cheese, ghee, We sanitised our facilities at regular
We expect the margins to improve on paneer, curd, dairy-based beverages, intervals and made employees work in
the back of stable raw material prices whey protein and several more healthy rotational shifts.
and kicker of the operating leverage dairy products.
coming into play. During the year, Leveraging position & growth
the share of milk products was 73% We also revved up our marketing During the year, we worked on
of the total revenues, with liquid milk strategy to promulgate the benefits fortifying our position and leveraging
Navigated the crisis with accounting for 10% share and skimmed of our healthy products. Our targeted our market presence with our
milk powder for 15%. marketing approach employing the stakeholders through operational
agility and resilience mix of traditional as well as digital has and cost efficiencies, and automation
With the infusion of long term funds helped us create a strong brand value improvements. We worked on digitising
Dear Shareholders,
into the business, our balance sheet for all our stakeholders. The strategy our sales channel and installed the
has strengthened. We expect to take has been designed in a way that it Distributor Management System
In the beginning, let us hope that you
our working capital loans to near zero perfectly amalgamates best practices of (DMS), Sales Force Automation (SFA),
and your family are keeping well in
levels, while strong improvement in the both co-operatives at the backend and integrating it with our core system.
these testing times of COVID-19.
operating cash flow is expected ahead. FMCG companies at the frontend.
FY2020-21 has been a year of
We had also experimented with
multifaceted challenges. It witnessed
Focus on Nutrition-rich products Our brands ‘Gowardhan’ & ‘Go’ project Prism during last year, wherein
one of the biggest health crisis that
The pandemic has led to a change continued to capture the heart of the we had established a dedicated call
continues to mar economic growth
in consumer preferences with more people and our niche brands ‘Pride of centre and taking direct orders from
and overall health of individuals
inclination towards nutrition rich Cows’ and ‘Avvatar’ are steadily gaining retail outlets, which were replenished
across the world. Though, we are
food. This shift has been evident in popularity among the targeted group of through distributors within 24 hours.
gradually recovering from this as the
the demand for immune boosters and consumers. Furthermore, we continued Due to lockdown restrictions and
vaccination drive has kick started
our journey of providing wholesome Million in FY20. The EBITDA stood at nutritional products in the market. to focus on our core products like difficulty in movement of sales team,
but the second wave of Corona Virus
living to consumers. We scouted for Rs. 1,248 Million in FY21 as compared Ghee, Cheese, Paneer, curd and Health we cascaded the leanings from Prism
is likely to pose a downside risk to
alternate supply chain and distribution to Rs. 2,111 Million in FY20. Milk We, at PMFL, are well equipped & Nutrition products. model across major markets and
economic activity. The second round
channels to manage sales in these prices continued to be on the upward to provide nutritional security to implemented the tele-calling system,
of lockdown to control the pandemic
testing times and complete lockdowns. trajectory, impacting our gross margins. people through our rich portfolio of Safe Operations backend software and replenishment
situation and increasing risk of delta
We made sure that milk and other dairy wholesome value-added milk and During these testing times, our model to navigate successfully during
variant had a severe impact on the
products were easily available to our Our focus on value-added products and products. Our robust R&D capabilities employees and distribution partners the difficult times
Indian economy. The dairy industry is
consumers. This has been a learning premiumisation as well as productivity backed by the longstanding relationship have been our tremendous support
a source of livelihood for millions of
experience for us and we are devising efforts enabled us to keep the EBITDA with farmers has been driving us system. Our employees worked round- Overall, we have chronicled a
small, marginal and landless farmers
business models that would enable us margins at 6.8% in FY21 as compared towards developing nutrition rich and the-clock to help us establish a good reasonable growth story and succeeded
as they rely on dairying to earn a
to be digitally-led and risk ready for to 8.7% in FY20. This is despite our easy to pocket products for consumers connect, trust and partnership with in continuing PMFL’s journey of healthy
livelihood. The demand and supply
future. supply chain getting disrupted and for a complete diet. farmers and the supply chain. They also and wholesome living.
of dairy products was subject to the
HoReCa as well as Modern Trade helped us maintain a good flow of milk
COVID-19 and other challenges like
In a nutshell, FY21 has been a year of Channel taking a setback. As part of our consumer-centric supply to our treasured patrons. I express my gratitude to all our
wildfires, locust attacks and flash
strengthening our reach, associations approach, we are developing best-in- shareholders and partners for helping
floods. It varied from region to region
and product portfolio with innovative FY’21 witnessed a subdued growth as class sustainable solutions and avant- While procuring milk and us to grow from strength-to-strength. A
but one thing that remained common
products that have larger audience to the Hotel, Restaurants and Catering garde consumable product range that manufacturing products, we undertook special thank you to all our employees,
has been the perseverance of people
serve and meet the changing demands of Channel Partners (HoReCa) segment uphold goodness and wellness. a holistic approach towards giving farmers, distributors, and vendors for
and businesses to bounce back to
the end users in terms of nutrition value. got adversely impacted due to the our consumers health and hygiene their continued support and trust in
normalcy.
lockdowns across the country during We have already taken our Premium in a neat package, at the same time Parag Milk Foods!
Our Performance the year. brand “ Pride of Cows” national with ensuring the safety of our employees.
Your Company did take the heat of
During the year, our consolidated the expansion of the portfolio from milk We well-equipped our facilities at Mr. Pritam Shah
the pandemic and its related issues
revenue from operations contracted Going forward, the prices of milk have to- Curd, ghee and Fat free milk. Manchar in Maharashtra, Palamaner in Managing Director
However, we remained determined on
to Rs. 18,418 Million from Rs. 24,379 started softening during the Q1FY22 Andhra Pradesh and Sonipat in Haryana

56 57
Parag Milk Foods Limited Focused on essentials. Optimised
Wholesometo grow.
living Corporate Overvies
Corporate Overview Statutory Reports Financial Statements
Financial Statements

Board of Directors
Ms. Radhika Dudhat
Mr. Devendra Shah Independent Director
Chairman
Ms. Radhika is a Partner with Shardul Amarchand Mangaldas & Co. She is a law graduate
PMFL has grown consistently under the leadership and vision of Mr. Devendra from the University of Bombay and a Post graduate from the University of Cambridge and
Shah. He brings enthusiasm and innovation to the business and has enhanced Harvard University. She has worked on a wide range of transactional, regulatory and legal
the Company’s revenue exponentially. It is with him at the helm that PMFL risk management advisory. She has been appointed as the Chairperson of the Corporate Law
has established the largest cow farm in India at Bhagyalaxmi Diary Farm. He and Governance Sub-Committee of the IMC Chamber of Commerce & Industry. She has been
is Member of the Nomination & Remuneration Committee, CSR Committee, enlisted in Legal Powerlist 2020 amongst top individual lawyers by Forbes India. She is a
Stakeholders Relationship Committee and Finance Committee. member of the Nomination & Remuneration Committee and Corporate Social Responsibility
Committee.

Mr. Pritam Shah

Managing Director
Mr. Nitin Dhavalikar
The overall execution strategy of the Company and consolidation of Company’s
Independent Director
market presence, all fall under the purview of Mr. Pritam Shah in his current capacity.
It is on account of him that the Company is able to compete globally by employing
Mr. Nitin Dhavalikar holds a bachelor’s and a master’s degree in Commerce from Pune
the most advanced manufacturing technology. His extensive knowledge and robust
University. He is also a qualified Chartered Accountant. He is Chairman of the Nomination
understanding of procurement and production processes has played a crucial role
and Remuneration Committee, Audit Committee and Finance Committee and a Member of
in improving PMFL’s performance. He is member of Audit Committee, Stakeholders
the Stakeholders Relationship Committee. He is essentially responsible for rendering financial
Relationship Committee and Finance Committee.
advisory to the organization. He has over 20 years of experience in overall business and
corporate finance advisory.

Mr. B.M. Vyas

Non-Executive Director

Mr. B.M. Vyas has had a long stint in the dairy industry and is the former Managing Mr. Ramesh Chandak
Director of GCMMF (Amul). He serves as an advisor to the top management and Independent Director
assists in the creation of efficient and effective growth strategies. He is closely
involved in monitoring the entire gamut of the business processes from the Mr. Chandak is a Chartered Accountant, and has completed Advanced Management Program
perspective of sales and distribution. He also serves in the capacity of an advisor to at Harvard Business School. He is Former recipient of CA Business Leader Award by the ICAI.
the Chairman of the Board on various issues. He is Chairman of the Stakeholders Mr. Chandak is CEO of RDC Business advisory, which provides individualized leadership
Relationship Committee, Chairman of Corporate Social Responsibility Committee coaching, strategy, succession planning and management services. Prior to starting advisory
and Member of Nomination & Remuneration Committee. practice, he was MD & CEO of KEC International Ltd. He is on the Boards of various listed
companies and Non Profit Organizations. He was associated with Engineering, infrastructure,
edible oil and textiles industries and has a global corporate experience of over 40 years
working in India, Malaysia and USA. He is member of the Audit Committee and Nomination &
Mr. Narendra Ambwani Remuneration Committee.
Independent Director

Mr. Narendra Ambwani holds a bachelor’s degree in Electrical Engineering from the
IIT Kanpur and MBA degree from IIM Ahmedabad. He was the Managing Director of
Johnson & Johnson’s consumer group in India. He has 39 years of experience in the
consumer product industry. He works as a strategic partner advising the top management
in developing business strategy to drive the next phase of growth of the company. He is
working closely with the team, to ensure accelerated growth of business. He is a member of
the Audit Committee and Corporate Social Responsibility Committee.

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Parag Milk Foods Limited Wholesome living Corporate Overview Statutory Reports Financial Statements

Management Team Corporate

Mr. Shashikant Dalmia
Chief Financial Officer (CFO)
Responsible for the overall financial functions of the Company, Mr. Shashikant Dalmia is a Chartered
Accountant by qualification. With his rich experience, he has demonstrated his ability to drive profitable
Information
BOARD OF DIRECTORS CORPORATE COMMUNICATIONS PLANT LOCATIONS
business growth in consumer product companies. He oversees Financial Reporting, Budgeting, Mr. Devendra Shah Ms. Pournima Surve A. Manchar Plant
Forecasting, Information Technology, Business Finance, Treasury and Process Mapping of the Company. Chairman and Whole Time Director Manager – Corporate Communication Awasari Phata, Post Manchar,
(DIN: 01127319) and Public Relations Tal. Ambegoan, Dist. Pune – 410 503,
Mr. Pritam Shah pournima.surve@parag.com Maharashtra
Managing Director B. Palamaner Plant
Ms. Akshali Shah (DIN: 01127247) STATUTORY AUDITOR 149-1, Samudrapalli Village,
Sr. VP – Strategy (Sales & Marketing)
Mr. B. M. Vyas M/s Sharp & Tannan, Post - Pengaragunta,
An MBA in Family Managed Business from S.P. Jain Institute of Management & Research, she is Non-Executive Director Chartered Accountants Palamaner Mandal, District - Chittor,
actively involved in branding, marketing & advertising strategy, category intelligence & competitive (DIN: 00043804) (Firm’s Registration No. 109982W) Andhra Pradesh - 517 408
analysis. She has also played a key role in revamping the corporate identity of the Company. Mr. Ramesh Chandak Ravindra Annexe, 194, Churchgate C. Sonipat Plant
Independent Director Reclamation, Dinshaw Vachha Road, Plot No. 2266-2268, Food Park,
(DIN: 00026581) Mumbai - 400 020 Phase-2, HSIIDC Industrial Estate- Rai,
Mr. Narendra Ambwani Sonipat, Haryana – 131 029
Mr. Shirish Upadhyay Independent Director COST AUDITOR
Sr. VP - Strategy (DIN: 00236658) Harshad S. Deshpande & Associates REGISTERED OFFICE
Ms. Radhika Dudhat Cost Accountants Flat No.1, Plot No. 19,
Mr. Upadhyay has 20+ years of experience in dairy and has spent 12 years with GCMMF (Amul). He has Independent Director (Firm Registration Number: 00378) Nav Rajasthan Society, S.B. Road,
been associated with the Company since 2010, during which he was responsible for strategic planning (DIN: 00016712) 403, Kumar Millennium, Shivaji Nagar, Pune - 411 016
and operations. For a brief time in 2017-2019, he advised the management on company strategy and Mr. Nitin Dhavalikar Shivtirtha Nagar Kaman, Paud Road,
operations, and joined the Company again in July 2019. He has a bachelor’s degree in Science from Sardar Independent Director Kothrud, Pune-411 038 CORPORATE OFFICE
Patel University and a master’s degree in Business Adminstration from Bhavnagar University. (DIN: 07239870) 10th floor, Nirmal Building,
SECRETARIAL AUDITOR Nariman Point, Mumbai - 400 021
MANAGEMENT TEAM N. L. Bhatia & Associates
Mr. Shashikant Dalmia Company Secretaries
Chief Financial Officer (UIN: P1996MH055800)
Mr. Sachin Shah Ms. Akshali Shah 507, Skyline Wealth Space,
Senior VP – Southern Operations Sr. VP- Strategy, Sales and Marketing 5th Floor, C2 Wing,
A Science graduate with over two decades of professional experience, Mr. Sachin Shah Mr. Sachin Shah Skyline Oasis Complex,
oversees the Company’s operations in Palamaner. Senior VP - Southern Operations Premier Road, Near Vidyavihar Station,
Mr. Shirish Upadhyay Ghatkopar (W), Mumbai - 400 086
Sr. VP - Strategy
Mr. Sanjay Nakra INTERNAL AUDITOR
Mr. Sanjay Mishra Vice President-Operations Grant Thornton Bharat LLP
Senior Vice President Mr. Sanjay Mishra 11th Floor, Tower II
Senior Vice President Indiabulls Finance Centre
Sanjay Mishra has over two decades of experience and is a Specialist in Process Cheese Recipes. He S B Marg, Elphinstone (W)
has a deep understanding of the evolving Indian palate and can develop various products to suit the COMPANY SECRETARY Mumbai 400013, India.
Indian Taste. He also heads the Liquid Milk Procurement in the company. In his career, he has worked Ms. Rachana Sanganeria
with the renowned dairy firms like Vadilal Dairy International Ltd. and Gokul Dairy. His academic CS & Compliance Officer BANKERS
accomplishment includes a bachelor’s degree in Science, followed by a Diploma in Dairy. cs@parag.com Union Bank of India
State Bank of India
INVESTOR DESK IDBI Bank Limited
Ms. Sangeeta Tripathi
Mr. Sanjay Nakra Sr. Manager - Investor Relations REGISTRAR & TRANSFER AGENT
Vice President-Operations
sangeeta.tripathi@parag.com KFin Technologies Private Limited
Sanjay Nakra is a Dairy Technologist with experience of over 25 years in Dairy Plant level Unit-Parag Milk Foods Limited
Manufacturing. His lustrous career includes stints across key companies like Glaxo Smith Karvy Selenium Tower B,
Kline, Himachal Milk Product, Foremost Industries and Modern Dairies. Sanjay travels across Plot No. 31 & 32,
Gachibowli,Financial District,
the world, to track global practices and advancements in the dairy sector.
Nanakramguda, Serilingampally,
Hyderabad - 500 032, Telangana

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Parag Milk Foods Limited Wholesome living Corporate
CorporateOvervies
Overview Statutory
StatutoryReports
Reports Financial
FinancialStatements
Statements

Management
Discussion & Analysis
Socio-economic Overview quintessential connectivity or in working class in order to overcome this
Almost a year-and-a-half into the automating processes across production economic misery over the immediate-to-
pandemic and the world stands at and distribution, the challenge of near term.
a crossroads of sorts. To augment reducing human intervention and
dependance is being fast galloped by Global Economy
economic growth with all its wherewithal
(including greater human participation) technology as its next big opportunity. With the pandemic triggering
or prioritize human health and life even unprecedented health challenge and
A pandemic was not as unpredictable economic disruption, the memory of
with economy-crippling restrictions.
as was the case with mankind’s global financial crisis of 2008 came
A tough choice for the governments
preparedness to deal with it. The to fore. Barring a handful exceptions,
across the globe to make. To fuel growth
unprecedented shortage of and rush to the entire world and its countries
with accommodative policy stances or
secure very basic tools like masks and and economic regions slipped into a
contain inflation with benign interest
PPE suits exposed the risk management sudden economic contraction. The
rates. Again, a tough choice for central
orientation of the governments and its speed at which the virus was spreading
banks to make. To conserve cash in order
leaders across the globe. At least on this was at race with the speed of this
to sail through the prolonged volatility
count, there was no difference between contraction. Thankfully, the timely
or pursue aggressive inorganic route in
the developed world and the developing and comprehensive local response
order to make the most of distressed
one. While the world still continues to by the governments, regulators and
times. A tough choice for businesses to
grapple with the pandemic, the need people to this ubiquitously global
make.
to build mass scale public healthcare challenge coupled with ingenuity of a negative -3.2% in 2020. Its two Indian Economy tax revenue collections and improvement
Almost six months into the vaccination infrastructure ought to become national the scientist and medical fraternity distinct constituent blocks, Advanced in the availability of finance.
India, the second largest constituent
drive raising human hope of a faster priorities, the world over. succeeded in reining in the challenge economies (AEs) and Emerging markets of EMDE block, was estimated to have
return to normalcy, periodic resurgence to a significants extent by the end of and developing economies (EMDEs) The Government announced a massive
Pandemic’s economic turmoil on witnessed a much sharper contraction of
of successive waves is creating an the first half of the year. witnessed output contractions by a spending push of over ` 4 trillion in the
individuals and families remains negative 7.3% in its fiscal year 2020-21.
intense race between the virus and negative -4.6% and -2.1% respectively. Union Budget 2021-22. This is expected
unprecedented. From employment Thereafter, witnessing sharp recovery of
vaccine. Unpredictability, coupled with Consequently thereafter, the economy But for China, a large global GDP to boost consumption supported by
losses to wage reductions to technology 9.5% for fiscal 2021-22, further as per
its longevity and diversity has been started its slow and steady return constituent in the EMDE block that solid fiscal and quasi-fiscal measures.
rendering many a job types untenable, IMF’s World Economic Outlook of July
putting to test human spirit of resilience towards normalcy. World economic defied the trend to post a positive The recovery in economic activity was a
a lot would need to be done by the 2021. It is estimated to grow at 8.5% in
and fight back. outlook of July 2021 of IMF estimates growth of 2.3%, the contraction in the result of impactful reforms undertaken
governments, corporations and the 2022-23.
the world output to have grown by EMDE block as well as the world output by the government since March 2020.
Many a core tenet of globalization, would have been much sharper. The country took a very bold move of In order to boost the economy, the
which were already at loggerheads Growth in % 2019 2020 2021 2022 Government has initiated several
a sudden and prolonged nationwide
with an emerging world order around World Output 2.8 (3.2) 6.0 4.9 Continuing on the steady gains made lockdown that contained the spread of investment focused spending programs
protectionist stances, are getting during the second half and partly also on pandemic at the cost of a highly crippling like the National Infrastructure Pipeline,
Advanced economies 1.6 (4.6) 5.6 4.4
challenged even more. Global supply account of a contracted base of 2020, economic contraction. After recording demand-driven capex, and the Centre’s
chains are fast easing the concentration United States 2.2 (3.5) 7.0 4.9 IMF predicts an equally sharp recovery Production-Linked Incentive (PLI)
a record contraction of 23% in the first
risks, with production moving back home Euro Area 1.3 (6.5) 4.6 4.3 for 2021 to be followed with a significant quarter, the economy staged a sequential scheme. The massive inoculation drive
or closer to consumption centers. Japan - (4.7) 2.8 3.0 moderation in 2022. 2021 growth rate recovery over the subsequent three undertaken by the Indian Government is
forecast for the world, AEs, EDMEs and quarters. In the second half, restrictions expected to help the economy and boost
Technology has appeared as a silver United Kingdom 1.4 (9.8) 7.0 4.8 India are (+) 6%, (+) 5.6%, (+) 6.3% and consumer sentiments.
on inter-state movements were lifted to
lining, and a formidable one. At a time Emerging Market and Developing Economies 3.7 (2.1) 6.3 5.2 (+) 9.5% respectively. In spite of a very ensure mobility of goods, thereby easing
when social animals are adapting to sharp recovery, it is worth noting that The beginning of FY22 was, however,
China 6.0 2.3 8.1 5.7 supply side pressures. Industrial activity
social distancing, the world is looking the average growth for three years (2020 marred by a stronger second wave which
India 4.0 (7.3) 9.5 8.5 picked up with stronger car sales, rising
at technology with heightened through 2022) would still be lower than resulted in temporary local lockdowns.
finished steel production and diesel
expectations. Be it in providing 2021 and 2022 are projections the pre-pandemic growth rate of 2019. Though the infection spread was more
consumption, higher goods and services
Source: IMF WEO July 2021

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

severe, the economy is expected to consumption volumes as well as hygiene and well-being. Demands Contributing to over 22% of global milk Break-up of Indian Dairy Market 2019
bounce back to normalcy led by the pent product prices, increased consumption for organic products, healthy foods, production, the country’s milk production Dairy Whitener
1.10% Others, 2.60%
up demand similar to that witnessed in of staples, essential non-foods and and goods for self-care hygiene are reached about 193 Million tonnes in
Ice Cream 1.10%
FY21 post the first wave subsided. indulgence categories. Rural markets significantly rising. Leading FMCG FY20, consuming almost all this quantity.
Butter 3.30%
continued to outperform the urban companies are embracing these new In spite of topping the global table in
Businesses and consumers have also markets. The metro markets registered trends and are leveraging their efforts overall production and consumption, the Curd 4.30%
grown more accustomed to operating a positive growth after two quarters. to create new products in this domain. per capita consumption of milk in India
under pandemic conditions, which With expectations of a good monsoon is quite low, thereby offering significant
Paneer 5.80%
is expected to contain the negative in 2021, making it the third consecutive • Growth in packaged products: In F&B headroom for demand growth over a
impact on economy. Economic activity year of rural rejoice, there is expected segment, there is a rise in demand sustained period of time. Dairy Sweets 7.60%
is expected to benefit from strong policy to be a boost up effect on the earnings for packaged food products following
support, including higher spending on of agrarian households and keep rural the health and hygiene trend of the Indian dairy industry, which has Liquid Milk 52.10%
infrastructure, rural development, and sentiments upbeat. This is further COVID times. Furthermore, there is traditionally been highly fragmented
health, and a stronger-than expected supported by rural centric schemes as also a growing demand for immunity- and hence being dominated by the
Khoa 9.10%
recovery in services and manufacturing bigger outlay for MGNREGA, rise in boosting food and beverages like unorganised segment, has been
sectors. wages and increase in MSP of key crops. herbal tea, aloe-vera juice, and more. making a slow yet steady shift towards
This has led the consumer to gravitate a larger play by the organised segment Ghee 12.30%
INDUSTRY OVERVIEW Within channels, sales growth from towards the organised sector. in recent times. This shift augurs well Source: IMARC Dairy Report 2019
Fast-Moving Consumer Goods (FMCG) the traditional trade channels jumped for the industry as organised players
to double digits, while growth in Government Initiatives COMPANY OVERVIEW Company expanded Pride of Cows brand
With an estimated market size of US$ bring in fair play, economy of scale,
e-commerce normalised down to single In order to aid the growth of the FMCG adoption of modern technology and With nearly three decades of presence in with two new product launches Pride of
110 Billion in 2020, the FMCG sector
digits. However, with second wave sector, the Government is also actively product innovations along with market the Indian dairy segment, Parag Milk Foods Cows Ghee and Pride of Cows Curd. Ace
is the fourth major contributor to the
infections growing and with last-mile framing lucrative policies, like: development for high end premium Ltd. (the Company/PMFL) is one of India’s Bollywood celebrity, Kareena Kapoor,
Indian economy. The urban segment
delivery boost up, the e-commerce products. Consequently, the share leading dairy FMCG companies with a was appointed as brand ambassador for
contributes to about 55% of the market
channel will continue to be dynamic. • In both cash and carry and single- of organised segment is estimated diverse portfolio in 15+ consumer centric its premium, subscription based, unique
while the rural segment contributes to
brand retail segments, the Indian to grow to 35% by 2024 from 30.3% product categories. The Company is adept Farm-to-Home Pride of Cows offering.
45%. In the last few years, the FMCG
Growth Drivers Government has allowed 100% FDI. in 2020. with the best global source of expertise
market has grown at a faster pace in The Company is looking to focus on four
• Increased focus on digitization: Furthermore, in the multi-brand retail and scientific knowledge in support of the
rural India compared to urban India. core categories of Ghee, Paneer, Cheese
Digitization has been an important segment, the Government has allowed Consumption pattern in India continues development and promotion of quality
FMCG products account for 50% of the and health and nutrition products. The
trend in Indian FMCG sector during the a 51% FDI. to evolve towards a more diversified mix, cow’s milk and milk products, to offer
total rural spending. Company boasts of a strong distribution
COVID-19 crisis. Most FMCG brands with a steady growth in share of value- consumers nutrition, health and well-
• Production Linked Incentive Scheme added products over fresh/liquid milk. network of 21 depots, over 200 super
Within the FMCG sector food & collaborated with leading e-commerce being. Though started small with producing
(PLI) proposed by the Indian union Steady shift in dietary patterns and rising stockists and 3,000+ distributors.
beverages (F&B) category contributes players to deliver products to their only fresh milk and skimmed milk powder
cabinet in 2020 has also provided a share of global cuisine has been aiding to The Company prides itself in having
to 19%. The F&B category is one of consumers by adhering to the (SMP), the Company has completely
boost to the manufacturing capabilities a faster growth of value-added segment established strong relationships with
the essential components of the FMCG safety protocols. The sales share of transformed itself with product offerings
and exports. that includes curd, yogurt, ghee, paneer, over 2 lakh farmers and having a reach
market, accounting for about 3% of its e-commerce in Indian FMCG sector covering over 170 SKUs of a wide range
cheese, flavoured beverages, whey of over 3.5 lakh retail touch points.
GDP and is the single largest employer is expected to increase to 4.5% post- • The initiation of GST has also reduced of value-added products such as cheese,
in the country, accounting for direct and COVID from 2-3% in pre-COVID era. the tax bracket of many FMCG protein, etc. Another trend within value- ghee, paneer, curd, dairy based beverages, Establishing trust & relationship with
indirect employment to more than 7.3 products by significant amounts. added products is the rising acceptance whey protein etc. dairy farmers, leveraging technology
million workforce. Growing consumer • Cloud Kitchens: Owing to the stark of premium branded products that offer to produce innovative products and
awareness, easier access and changing reduction in consumer footfall, most • Introduced the Consumer Protection cuisine specific appeal. The Company is a leading marketer of
establishing a cost-efficient distribution
lifestyles have been the key growth F&B businesses are actively shifting Act in 2019, to address consumer branded dairy products owning 2 mass
In value terms, the Indian dairy market network aided by targeted marketing;
drivers for the sector. to cloud kitchen models serviced by grievances in a simple, speedy, market brands: ‘Gowardhan’ & ‘Go’ and
is estimated to grow to ` 22,000 Billion the Company has managed to create
tie-ups in collaboration with food accessible, affordable and timely 2 niche brands ‘Avvatar’ and ‘Pride of
in 2024 from ` 12,197 Billion in 2020. strong value for all stake holders. It
The FMCG sector started the calendar aggregators that offer the facility of manner. Cows’ spanning across the pyramid –
It is noteworthy that this steep rise in has combined the best practices of
year 2021 with a strong growth online ordering and delivery. This premium, modern and traditional.
value is forecast against a moderate both co-operatives at backend and
momentum, growing at 9.4% in January- trend in India is expected to grow by Indian Dairy Industry
consumption growth in terms of volume. After pioneering and establishing our FMCG companies at frontend to grow
March quarter over the same period 15% over the next few months. With a very ancient tradition of cattle
The real opportunity, hence, appears premium offering under the brand “Pride sustainably.
in the previous year, after growing raising for domestic consumption
at 7.3% in October-December 2020. • Growing prevalence of health and to be presenting itself in premium, high of Cows”, and having created a strong
of milk, India is the largest producer During the year, the Company
The growth was fuelled by rising wellness category: There is a growing end products. brand equity through our consistent
and consumer of Milk in the world. managed to keep its supply chain and
awareness among consumers about process and quality. During the year, the

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

India: Dairy Market Forecast PRODUCT CATEGORIES PMFL’S ACHIEVEMENTS food. However, we have seen challenges follows a distinct home-made recipe, PMFL’S ACHIEVEMENTS
(in Billion INR), 2019-2024 Ghee Apart from having a large consumer in HoReCa (Hotels, restaurants and setting it apart from its peers.
canteen) segment which were disturbed PMFL is the largest private player in
Ghee is a traditional ingredient in Indian portfolio, PMFL is also a dominant cheese
PMFL is the biggest private player in the UHT milk and one of the largest in
21.999.9

player in the institutional and Hotels, considerably during lockdown. There

households and is used as a cooking the Mumbai market. The Company beverages segment.
Restaurants and Catering (HoReCa) was also disruption in QSR segment for
oil. After liquid milk & Dahi, ghee is the also has a strong presence in the urban
segment. The Company has introduced some time.
7,706.0
14,293.9

third largest segment in the Indian diary parts of West and South India. Since During the year, due to closure of offices,
industry. The market size of ghee in 2019 various innovative products in Cheese schools, colleges, transit points like bus
10,544.3

3.060.3

Curd the Company has been focussing on

was ` 2,273 Billion, growing at a 10-year and has achieved a dominant position, stations and railway stations, etc. which
7,454.0

While curd was essentially made at home, selling a large part of its pouch and cup
CAGR of 12.45%. As much as 18% of the garnering over 35% of the market share. are the major points of sale for beverages
it has transformed into a product that is curd through Modern Trade channel,
total ghee production is currently from there has been disruption caused in this like flavoured milk, lassi, buttermilk, etc.,
2019 2024 During total the year, we have seen now branded and packaged. The curd
the organised sector and is growing at a category due to store closures, timing we have seen considerable challenges in
healthy growth in consumer cheese market was ` 884 Billion in 2019. There
Total Unorganised Organized rapid pace restrictions as well as change in buying this segment.
segment because of people staying at has been rapid growth in the organised
home during lockdowns and enjoying curd segment with a CAGR of 18.8% over behaviour of consumers for buying fresh
manufacturing uninterrupted despite According to the latest report by IMARC Whey Protein
home-made food. However, we have the same period to ` 84 Billion. Higher products like milk and curd on daily
lockdowns and restricted mobility total Ghee market is expected to reach Whey protein is sold in both the sports
seen challenges in HoReCa (Hotels, growth has been witnessed in metros as basis from these outlets. While we have
caused by COVID-19. The Company’s to Reach INR 4,653 Billion by 2024. nutrition segment and consumer nutrition
restaurants and canteen) segment which compared to rural areas. embarked on focussing more towards
agility and robust strategies enabled General Trade channel to navigate out of segment. The market for whey protein in
PMFL’S ACHIEVEMENTS were disturbed considerably during
it to overcome challenges posed by Going forward, the total curd market this situation, its work in progress. 2019 was ` 6.6 Billion. While almost 100%
PMFL is not only the pioneer of ‘Cow lockdown. There was also disruption in
the pandemic and consolidate its in India is expected to grow at 15.4% of whey protein products in the sports
ghee’ segment but is also the most QSR segment for some time.
operations and enhance efficiencies. CAGR during 2019-2024 to ` 1,809.3 Ultra-High Temperature (UHT) and segment are imported, the health and
Focus on core products and strong sought-after brand in this space. Cow Beverages nutrition market is dominated by a few
Paneer Billion by 2024. The organised curd
business model enabled the Company ghee commands greater margins and is large MNCs. Total Whey powder market is
Paneer is the fourth largest segment in market is expected to reach ` 175.3 India’s UHT milk market in 2019 was
to clock one of the highest sales for growing at a faster rate as compared to expected to grow at 22.1% CAGR during
the milk products category. Its market Billion by 2024. ` 63.3 Billion UHT Milk is growing
core consumer product categories the overall ghee segment. 2019-2024 to reach ` 18 Billion by 2024.
size in 2019 was ` 317 Billion. Indian at a rapid pace in metros because of
like Ghee, cheese and paneer during PMFL’S ACHIEVEMENTS advantages such as safety, convenience
During the year, we have seen healthy households across the country consume PMFL’S ACHIEVEMENTS
lockdown period. growth in Ghee sales due to lockdowns and a longer shelf life. Areas with milk
paneer as a staple food. Paneer is an PMFL has a significant presence in major
and people staying at home, lot of integral part of many traditional and deficiency are increasingly adopting milk PMFL is the only player in India
The Company has a pan India metros like Mumbai, Pune, Nagpur,
cuisines were being made at home modern Indian recipes, which are equally powders and UHT milk. During 2019- manufacturing high value-added whey
manufacturing footprint with Bengaluru & Chennai and is now
and further during this time due to popular amongst kids, younger and older 2024, UHT is expected to grow at 25% protein from scratch, that too from 100%
manufacturing facilities strategically expanding into NCR. The Company’s
heightened awareness for safety and generations. CAGR to ` 193.3 Billion. cow milk. The Company’s brand of whey
located at Manchar in Maharashtra, curd is made from pure cow milk and
purety, consumers preferred branded protein, Avvatar, in the sports nutrition
Palamaner in Andhra Pradesh and
products like Gowardhan, which they The organised segment, amounting to category is growing rapidly in the
Sonipat in Haryana and three third-
can trust on only ` 11 Billion (3.5%), is growing due market. This category has higher margins
party milk packaging facilities located
to an increase in demand for packaged and thus, PMFL has targeted to launch
at Nagpur, Vasai & Vashi. The Company Cheese paneer on the back of concerns related more products in this segment with the
has one of the largest cheese plants
Cheese is one of the fastest growing to hygiene and people discovering a aim of garnering ~7% contribution to
in India and the first state-of-the-art
dairy segments in India. The market size consistent taste with the product. the Company's total revenue from this
fully integrated Whey protein and
of cheese in 2019 was ` 28.7 Billion. segment over medium term.
lactose plant in India. The Bhagyalaxmi PMFL’S ACHIEVEMENTS
The major drivers behind this growth
Dairy Farm is a modern dairy farm During the year, we have seen
are the changes in dietary preferences PMFL makes its paneer from 100% cow
housing over 2,300 Holstein Friesian disruptions in this category due to
of consumers, as well as growth of milk and has leveraged innovation in
cows and is equipped with the finest closure of nutrition shops, gyms, etc.
the Quick Service Restaurants (QSR) manufacturing and packaging to enhance
international equipment that provides which are the major points of sales for
sector. In India, Maharashtra is the the shelf life of its products. Gowardhan
the consumers with superior Farm-to- the category.
biggest consumer of cheese, followed Paneer is the only fresh paneer available
Home milk. The Company envisions
by Gujarat, Delhi, Tamil Nadu and Uttar in the market made from 100% cow’s
to drive innovation in milk and milk
milk and with a high shelf life of 75 days. Liquid Milk
Pradesh.
products through its well-diversified Liquid milk market was sized at ` 4,802
portfolio of brands that deliver dairy During 2019-2024, the cheese market is During the year, we have seen healthy Billion in 2019 ~67% of the milk sold is
products of international quality expected to grow at 26% CAGR to reach growth in Paneer segment because through the unorganized segment, and
standards and strive to add value to ` 91 billion by 2024. of people staying at home during balance 33% is organized. The organized
everyday life of consumers. lockdowns and enjoying home-made

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

space itself is highly fragmented, as the fresh milk through Modern Trade channel, Strengthen brand equity: The Company the company is planning to expand the and replenishment model to navigate within our facility to ensure real-time
majority of the organised milk is sold there has been disruption caused in this has 4 very strong brands with deep products under this umbrella. successfully during the difficult times. availability and also saving costs.
in poly pack pouches, having a shelf category due to store closures, timing consumer connect. The Company is
life of ~48 hours. This requires a highly restrictions as well as change in buying committed to enhance brand recall Focus on health and nutrition: Evolving What we did different this year – Our We have been providing free food to
localised distribution network to supply behaviour of consumers for buying fresh through strategic branding initiatives with changing consume needs, the Strategic initiatives’ all our workers and during pandemic
fresh milk. There are several regional products like milk on daily basis from and increased ad spend on diverse Company has introduced a wide range of Solidarity towards our Farmers- time, extended the free food facility to
players and co-operatives across these outlets. While we have embarked channels including television, newsprint healthy and nutritious product variants Milk being a perishable commodity community around the area affected
different markets, catering to market- on focussing more towards General Trade and digital media. like whey protein powder under Avvatar every day we collect 10-12 lakh liters with pandemic as also taking care of
specific needs. channel to navigate out of this situation, brand and is further looking at introducing (1-1.2 mn litres) of milk, from over 2 migrant workers.
its work in progress. Increase milk procurement: The health products for mass consumption in lakh farmers spread over Manchar and
Going forward, the organised liquid milk Company’s strength lies in its long lasting different formats, colostrum products as Supply chain agility- Operating our
Palamner, and process it in our factories.
market is expected to grow at a 5-year Outlook farmer relationship which it constantly daily supplements and high protein, low supply chain in the midst of restrictions
During lockdown, the first impact was
CAGR of 16% over FY19-24. strives to strengthen further by offering fat cheese products, among others. imposed during lockdown was a huge
Despite the challenges that COVID-19 reduction in milk offtake by the local &
quality and quantity based incentives. challenge. Heavy restrictions on timing
has presented to the entire global unorganized players resulting in distress
PMFL’S ACHIEVEMENTS The Company is planning to set up new Enhance product reach: The Company during which the retail stores would
economy, the Company remains buoyant among the farming community. We as
PMFL is the biggest private player in collection centres and increase its reach realises the importance of a strong and remain open in different parts of the
about future growth prospects. The a responsible player have increased our
the Mumbai market and amongst the to newer districts. The Company has set deep distribution network. It is thus country gave us a narrow time window
Company believes that the situation has procurement commitment and procured
largest private players in Pune, Nagpur & a target to add 75 new bulk coolers and working to strengthen distributor and of just few hours to complete our entire
brought up new opportunities across more than 1.5 million litres per day
Bangalore. The Company also has a strong 100 automated collection systems by. stockist base to achieve better retail redistribution operation in the market on
dairy and FMCG sectors. The Company during the lockdown period, taking care
presence in the urban parts of West and penetration. To enhance presence in a daily basis.
being a well-established player in the of the excess milk and converting into
South India. Since the Company has been During the year, due to lockdown tier III cities the Company is working to
value-added segments with a pan – inventories for various milk products. We motivated our sales team by
focussing on selling a large part of its restrictions in place and unorganised introduce low unit price products to be
India distribution reach is well placed to During lockdown, due to shutdown of providing daily cash incentives and safe
players unable to operate, farmers were able to suit consumer pockets in these
capture these opportunities and increase many industries, dairy farming was a mobility options to move effectively in
in distress to dispose their milk. The cities. The Company’s strategy team is
market share. major source of livelihood for landless the market. Through that, we pushed
company stood solidly with the farmers also working to identify specific states
labourers and marginal farmers in rural our distributor partners to re-start their
The Company is committed to its long- during this difficult time and increased and regions in the country where it can
India. We believe that this act would operations during limited window of
term goal of providing the highest level milk procurement during lockdown enhance reach and/or increase sales
go a long way in further strengthening time and supported with manpower
of consumer satisfaction with well- period substantially, running all its plants volumes. The Company’s focus is to
the trust of the farmers, which forms an & logistics as well as higher margins to
established brands, robust operational at full capacity to handle the milk and increase shelf space at existing outlets.
important pillar for the Company. operate in difficult times.
and financial practices and expected convert into various products. While
the demand side faced some challenges, Over the year, as a part of our
revival in demand across product Uninterrupted operations – With In areas with limited retail outlets being
we increased our inventory to be later consolidation move, we have been
categories. The Company has identified higher milk coming in from the farmers open, we also implemented direct
liquidated over high consumption focussing on depth of distribution rather
certain strategic priorities to deliver on during these tough times, we ensured order taking from consumers and home
season. This show of trust with the than width of distribution and hence
profitability and sustainable growth. uninterrupted and full utilization of all our delivering products to them as well as
farmers forged our relationships further The Company’s focus is to increase shelf
plants, churning out various products as placing vans with products at various
Increasing operational efficiency: The and would help the company in attaining space at existing outlets. Apart from
per future requirements. We motivated housing societies to make products
Company aims to leverage in-house its procurement goals for future more that, we have been working on digitising
our workers with daily cash incentives, available to consumers during these
technological and R&D capabilities to effectively. our sales channel by installation of
home-to-plant safe mobility solution and tough times.
maintain strict operational controls, Distributor Management System
100% safe working conditions to ensure
enhance its consumer service levels Increase value-added product portfolio: (DMS), Sales Force Automation (SFA)
availability of enough manpower even In order to incentivize our supply chain
and develop customised systems The Company is focusing to add revenue and integration with our core system.
during the peak of migrant crisis. partners, transporters & sales team
and processes. As informed earlier, share of its value added products to We had also experimented with project
special arrangements were made for
the Company has embarked on cost improve margin profile. The Company is Prism during last year, wherein we had We also faced difficulty in getting their safety and comfort including
efficiency measures across the value- looking to offer wider range of farm-to- established a dedicated call centre required raw materials and packaging arrangement of food and refreshments
chain since last 2 years and we have home products under its ‘Pride of Cows’ and taking direct orders from retail materials from our vendors as many of along with the general sanitization
seen substantial benefits in terms of brand and premiumize its portfolio with outlets, which were replenished through their operations were closed and worked facilities. We ensured that drivers of all
containing other expenses during the strong focus on developing high value distributors within 24 hours. Due to closely with local authorities as well as transport vehicles were provided with
year. This is an ongoing exercise and health and nutrition products. During lockdown restrictions and difficulty in industry players to re-activate our regular enough food for their entire journey
we are looking at not only sustaining the year the company has launched ghee movement of sales team, we cascaded vendors or identify alternate sources and reciprocal arrangements were made
majority of the savings over last year, but as well as curd under its Pride of Cow the leanings from Prism model across / locations to ensure supplies. We also at their destination for stay, food and
also work on deriving further savings in Umbrella. The acceptance of this product major markets and implemented the offered our locations to suppliers to shift safe movement.
the process. has been strong, and going forward, tele-calling system, backend software their equipment and produce material

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

would be broadly focusing on Ghee, Ratios

Cheese, Paneer and Health & Nutrition
product categories.The Company has Particulars FY21 FY20 % change
greater contribution towards its gross
Debtors Turnover Ratio (times) 11.6 8.0 44%
profits and margins from these value-
added dairy product portfolio. Inventory Turnover Ratio (times) 2.7 3.9 -31%
Interest Coverage Ratio (times) 1.9 4.3 -56%
Apart from that, we have been working
Current Ratio (times) 1.7 1.6 2%
on digitising our sales channel by
installation of Distributor Management Debt Equity Ratio (%) 37.8% 40.6% -7%
System (DMS), Sales Force Automation Operating Profit Margin (%) 6.8% 8.7% -22%
(SFA) and integration with our core Net Profit Margin (%) 1.1% 3.8% -71%
system. We had also experimented with
project Prism during last year, wherein Return on net worth (%) 2.2% 10.3% -78%
we had established a dedicated call
Due to Pandemic, and the resulting lockdown, the revenue and the profitiabiltiy was
centre and taking direct orders from retail
impacted. This has led to variance of more than 25% for profit, networth and interest
outlets, which were replenished through
coverage ratios.
distributors within 24 hours. Due to
lockdown restrictions and difficulty in
During FY21, the share of milk products economic environment. The Company
movement of sales team, we cascaded
was 73% of the total revenues; with proactively adapted distribution as well
the leanings from Prism model across
liquid milk accounting for 10% share and as supply chain to suit the needs as
Marketing and consumer engagement Expansion The Company has a fully integrated value major markets and implemented the
skimmed milk powder for 15%. per the evolving situation. Further, the
drive -Restriction of movement of chain with control over key processes tele-calling system, backend software
Company introduced new products and
consumers meant that we had to deploy To add further value to its large cheese from procurement and supply chain to and replenishment model to navigate During FY21 growth was subdued due focussed on brand building.
creative ways to reach out to people who and whey business, the Company processing and distribution, maintaining successfully during the difficult times. to
were in lockdown mode in their homes. has introduced high potential highest standards of quality and delivery In May 2021, the Company raised ` 316
Financial Performance Highlights • Severe impact on business from the
Our teams were nimble, agile and acted Lactose products. The Company has throughout. crore by way of preferential allotment
HoReCa segment (Hotel, Restaurants
swiftly in response to this extremely commissioned a Lactose Plant with a • Due to COVID impact, consolidated of equity shares, FCCBs and other
and Catering Channel Partners) due to
challenging situation. We remodeled capacity of 40 MT/day. The Company’s best practices and Revenue from Operations moderated Instruments. International Finance
lockdowns across the country
our marketing, consumer engagement as state-of-the-art infrastructure makes to ` 18,418 Million in FY21 from Corporation (IFC) invested ` 155 crores
Through the commissioning of this plant, it the partner-of-choice for leading ` 24,379 Million in FY20.
well as last mile supply chain strategies. • Huge impact of COVID-19 on by way of subscription to preferential
the Company is now intending to add MNC players and is thereby confident
We levered ecommerce to our advantage Modern Trade channel which is a issue of equity shares and subscription
higher value to Whey Permeates that are of reaping the benefits of further value • Operating Profit (EBITDA) was ` 1,248
.Since hotels, restaurants, cafes, and large part of liquid milk distribution of FCCBs in addition to subscription
generated during the filtration process addition in its Health & Nutrition Million in FY21 as compared to ` 2,111
catering services have not been functional for the Company. Also there has been to NCDs of ` 150 crores. Sixth Sense
of whey protein. business. Million in FY20. In spite of challenging
during the COVID crisis, this led to steep shift in consumer buying behaviour Venture Advisors LLP, invested ` 50
environment, our Operating EBITDA
decline in consumption of our products ). The Company’s expertise in dairy from these outlets, leading to lower crores by way of preferential issue of
Consolidation was a mantra all across margin remained at 6.8% in FY21 as
In an effort to compensate for loss in out ingredients has allowed it to create revenues. equity shares. The promoters subscribed
- As a part of our consolidation move, compared to 8.7% in FY20. Led by
of home consumption of our products, lactose that is ideal for multiple segments operating leverage margin is expected for preferential allotment of 10 Million
we have been focussing on depth • Lower commodity sales (SMP) due to
we redesigned our marketing campaigns such as food applications, infant nutrition to improve once revenues come back convertible share warrants, convertible
of distribution rather than width of lockdown related disruptions.
with influencers (to educate and inform and clinical nutrition products. to normalcy. into equity shares for ` 111 crores.
distribution and hence the Company’s
the consumers about using our range During the year, the prices of milk These funds will help reduce the overall
focus is to increase shelf space at
of products to try out restaurant –style The Indian lactose market size is • Profit After Tax (PAT) stood at ` 207 debt burden and will be utilized for capex
existing outlets. increased post easing of lockdown
dishes at home. For the year we used a ~40,000-45,000 MT and is valued at Million in FY21 as compared to ` 937 requirements over the next two years.
restrictions after first phase and peaked
mix of digital as well as traditional media ` 5,000 million (~USD 70 million), with Also on the marketing front we Million in FY20.PAT margin stood at These would also enable the Company
in Q4FY21. Milk prices started softening
to promote our brands. a major part of the requirement being have limited mass market brands as 1.1% in FY21 as compared to 3.8% in to free up cash flows and enhance
during Q1FY22 and procurement also
met through imports. This provides a ‘Gowardhan’ & ‘Go’ while shall continue FY20. working capital for future growth. The
In line with our statement of purpose increased.
huge opportunity for import substitution with niche brands ‘Pride of Cows’ and Company would thus be in good stead
“Ideas for new day”, even during the for players like Parag Milk Foods Ltd. • Diluted Earnings Per Share (EPS) was The Company continued on cost to bolster the balance sheet and propel
‘Avvatar’ targeted towards specific
pandemic we continued with our new that has end-to-end manufacturing ` 2.46 in FY21 as against ` 11.14 in rationalisation efforts to minimise the future growth.
consumer segments. We have also
product launches, like Pride of Cows capabilities to tap into. FY20. impact on profitability amidst challenging
limited our product offerings and stock
ghee and curd etc.
keeping units under this exercise and

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

HUMAN RESOURCES incomes, supply chain disturbances due Competition risk: The Company faces The audit committee evaluates vaccinations and free health camps. ENVIRONMENT SUSTAINABILITY
Human capital is most critical resource of to the pandemic adversely impact the immense competition from both domestic and monitors the internal control The Company always procures all the The Company practices Zero Accident
the Company which plays an inevitable business. and international players given the high and processes. Based on their produce of the farmer even if there is Culture and drives several workplace
role in business continuity and success. growth prospects of the dairy industry. recommendations the internal controls surplus. During pandemic, when supply safety initiatives. All manufacturing
Mitigation: The Company’s resilient are constantly upgraded. Any deviations chains were disrupted and milk demand
Competent HR policy framework units adhere to highest safety standards
business model and strong commitment Mitigation: Long legacy, strong brand from standard are corrected and had become lower than produce, the
enables the Company to attract skilled and protocols. The Company manages
towards business and people at equity, unparalleled bond with all measures are taken to strengthen the Company continued to procure all the
talent, offer adequate training and skill occupational health and safety by
large enabled it to carry out business stakeholders and undivided focus on internal control framework further. produce from farmers and converted it
development programs and maintain systematically assessing the hazards
operations smoothly even amidst innovation gives a strong edge to the Quarterly reporting is presented to the into high shelf life products.
high motivational spirits ensuring both and mitigating risks through awareness
challenging times. The company Company over competition. Board. To ensure the well-being of the
personal and profession growth of every programs and safety training for all
undertook a host of measures to ensure employees, the Company has a well- The Company supplies milk to deaf
employee. Regulatory risk: Any unforeseen changes employees. All health and hygiene
safety of all its employees and suppliers designed code of conduct. It is reviewed school children in the Narodi village of
in the legal and regulatory environment needs at workplace are taken care of
The Company constantly strives to without compromising on business. and monitored at regular intervals and in Ambegaon taluka in the Pune district
may lead to non-compliance to local and by engaging with occupational health
upgrade its processes and methods, case of violations of the code of conduct of Maharashtra on a daily basis. The
Redundancy risk: Market trends global laws and regulations. This may experts.
and leverage innovation to enhance the prompt action is initiated. Company provides shelter and care for
rapidly evolve with changing times. result in erosion of brand equity and may old, abandoned cows and other animals,
capabilities of its workforce. To foster all During the challenging COVID-19
The Company needs to keep pace result in claims or enforcement. CSR at two centres (Panjrapole) in Eklare
round development of all employees, the times, the Company ensured maximum
with changing consumer needs and and Jalukay. PMFL distributed snacks
HR policies have built a culture of mutual Mitigation: The Company’s robust The Company believes in inclusive support to the farmer community and
accordingly innovate flavours and new to all schools and junior colleges during
trust and appreciation. Transparent and risk and controls management system growth encompassing health, welfare ensuring business continuity so that the
products/categories. Independence Day and Republic Day
open door policy enables high levels ensures strict compliance to all applicable and development of the people working consumer is well provided for. Day-to-
of employee engagement and clear with it and communities around the celebrations at Awasari Khurd. The day health monitoring of all employees
Mitigation: The Company has a R&D rules and statutes. The Company also has
knowledge of their key responsibilities workplace. Since White Revolution Company also provides scholarships to and sanitising the workplace were
team responsible for keeping a close eye established processes and governance
among all employees. Increased days, the Company has been striving underprivileged students as a means judiciously practised. Social distancing
on emerging trends and formulate new to drive implementation and compliance
efficiency and involvement in turn to relieve the stress of dairy farmers. to help them become employable. The measures were implied within the plant
products to avoid risk redundancy risk. with the Company Rules and Code of
enables to align employee values, goals Company also engages in teaching farm boundaries and all transport vehicles
Business Conduct.
and mission with that of the organisation. Supply risk: Inadequate supply or PMFL provides support to dairy best practices to farmers in surrounding adhered to safety rules prescribed by the
unavailability of milk may lead to INTERNAL CONTROLS AND farmers through various initiatives areas through study tour of Bhagyalaxmi government. The Company employed
Regular skill development programs production delays and impact brand ADEQUACY like transparent procurement pricing, Dairy Farm, helping them to understand limited manpower and adopted
and training initiatives lead to stronger equity. subsidized cattle feed, free cattle techniques of improving cows’ milk yields. automation techniques and longer work
To encourage a strong culture of
employee connect and superior shifts to ensure that the plants operate
integrity and ethics, management
performance. Select employees are Mitigation: The Company has long-
efficiency, provide reasonable assurance at optimum capacities.
further groomed under guidance of lasting relationship with farmers which
on efficient conduct of business and
prominent institutes. Several rewards, enables it to ensure adequate inventory
ensure safeguarding of assets, reliability
recognition programs and employee at all times. Further strong inventory Cautionary Statement
of accounting practices, prevention of
benefit schemes ensure high levels of management system enables to wade Certain statements in the Management Discussion and Analysis section may be ‘forward-looking’. Such ‘forward-looking’ statements
frauds/errors and compliance with the
employee engagement and motivation. away supply risk. Amidst pandemic, when are subject to risks and uncertainties and therefore, actual results could be different from what the Directors envisage in terms of
applicable regulatory requirements,
Such positive work culture enables milk supply was more than demand the the Company’s future performance and outlook.
the Company has robust internal
the Company to attract and retain Company in order to secure it’s farmers
financial control (IFC) systems in place,
key talent. The Company strives hard continued converted it to higher shelf
commensurate with the size and industry
to maintain a safe, conducive and life products.
in which it operates. The IFC systems
productive environment to foster a
Concentration risk: Dependence of is effectively managed by the Board
culture of constant learning, self-growth
business in only four states reduces of Directors who set the guidelines,
and satisfaction for all employees. As on
robustness of business as any unforeseen verify their adequacy, effectiveness and
March 31, 2021 the Company had 1,563
changes in economy of these states may application. To keep a close eye on the
employees.
hamper sustainability. overall governance processes within the
KEY RISKS AND MITIGATION Company including the application of a
Mitigation: The Company is constantly systematic risk management framework,
STRATERGIES
working to de-risk its business by regular assessment of the effectiveness
Pandemic risk: Restricted mobility, expanding business to adjacent areas of IFC systems is conducted.
lockdowns, reduction in disposable and similar geographies.

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

PERFORMANCE ANALYSIS AND OUTLOOK We believe that COVID-19 will bring up new opportunities

Board’s Report The COVID-19 pandemic which has been a once in a lifetime across dairy and FMCG sectors and our Company being a
well-established player in the value-added segments with a
occurrence has brought with it great suffering to people and to
almost all sectors of the economy. The nationwide lockdowns pan – India distribution reach is well placed to capture these
Dear Members, opportunities and increase our market share.
to limit the transmission of COVID, has put the global economy
The Board of Directors present the Company’s Twenty-Ninth Annual Report and the Company’s audited standalone and in extreme stress and would have a long-lasting economic
We have been committed to our long-term goal of providing
consolidated financial statements for the financial year ended March 31, 2021. impact upon the Country too.
the highest level of consumer satisfaction with our host of
FINANCIAL HIGHLIGHTS The long-lasting and evolving nature of this pandemic well-established brands and we are confident of achieving
The Company’s financial results (standalone and consolidated) for the financial year ended March 31, 2021, forming part of this with its resurfacing in the form of second wave at the close robust operational and financial performance with full-fledged
Annual Report, have been prepared in accordance with the Indian Accounting Standards (Ind AS) as notified by the Ministry of of the year has once again created uncertainty, including revival in demand across product categories.
Corporate Affairs (MCA). adverse economic impact on India. Hopefully, the outreach
DIVIDEND
of vaccination drives across the country, additional efforts to
The standalone and consolidated financial results for the financial year ended March 31, 2021 is summarized below: set up adequate medical infrastructure and procurement of The Board of Directors at their meeting held on June 12, 2021,
required medical supplies, in addition to continued adherence recommended a final dividend of ` 0.50/- per equity share i.e.
(` in Million) 5% of face value of ` 10/- each for the financial year ended
to COVID-19 safety protocols will help in overcoming this
unprecedented situation. March 31, 2021 , subject to approval of the shareholders at the
 Particulars Standalone Consolidated ensuing 29th Annual General Meeting (“AGM”).
31-Mar-21 31-Mar-20 31-Mar-21 31-Mar-20 Company Growth for FY 2020-21 was affected adversely due to:
If approved, the dividend would result in a cash outflow of
Revenue from Operations 17,917.35 23,912.77 18,417.63 24,379.24
• Business from the HORECA segment (Hotel, Restaurants ` 4,76,87,921 /-. payable to those Shareholders whose names
Other Income 68.24 29.19 135.09 75.99 and Catering Channel Partners) was impacted during the appear in the Register of Members as on the Book Closure /
Total Income 17,985.59 23,941.96 18,552.72 24,455.23 year due to lockdowns across the country during the year. Record Date. The total dividend pay-out works out to 27.32%
Earnings before interest, Depreciation and Tax 1,335.61 2,146.28 1,382.96 2,187.01 (Previous Year: 4.63%) of the Company’s standalone net profit.
• A large part of our Liquid Milk is distributed through In view of the amendment in the Income Tax Act, 1961 through
Less:- Depreciation 493.76 513.75 517.98 536.41 Modern Trade channel and due to pandemic situation and the Finance Act, 2020, imposition of Dividend Distribution Tax
Less :- Interest 455.18 380.41 457.74 381.04 subsequent lockdowns, Modern Trade channel was highly (DDT) has been abolished. The dividend, if declared, at the
Profit before Tax and exceptional items 386.67 1,252.12 407.24 1,269.56 affected as well as there has been shift in consumer buying ensuing AGM will be taxable in the hands of the members of the
behaviour from these outlets, leading to lower revenues. Company and the Company is required to deduct tax at source
Exceptional Items -- -- -- --
(“TDS”) from dividend paid to the Members at prescribed rates
Profit / (loss) before tax 386.67 1,252.12 407.24 1269.56 • Lower commodity sales (Skimmed Milk Powder) (SMP)
as per the Income Tax Act, 1961.
Tax expense due to lockdown related disruptions

(i) Current tax 61.12 293.13 61.12 297.88 The Dividend declared/recommended is in accordance with
Raw milk prices dipped during the first quarter because of
the Company’s Dividend Distribution Policy, which has been
(ii) MAT (Credit) / Reversal 0 35.38 0 53.83 demand softening and disruptions in unorganized channel. In
disclosed on the Company’s website, www.paragmilkfoods.com,
(iii) Deferred tax 70.41 17.23 63.5 23.22 order to support the farmers during this season, we procured
as required under Regulation 43-A of SEBI (Listing Obligations &
excess milk during that period and converted into inventories
(iv) Tax adjustment in respect of ealier years 80.6 0 75.57 -42.26 Disclosure Requirements) Regulations, 2015, as amended .
of various products as per requirements and a part of these
Profit for the period/year after tax 174.54 906.38 207.05 936.89 inventories were liquidated in subsequent quarters. However, TRANSFER TO GENERAL RESERVE
Earnings per Share the raw milk prices increased post easing of lockdown
The Board of Directors have decided to retain the entire
Basic 2.08 10.80 2.47 11.16 restrictions after first phase and peaked in last quarter of
amount of profit for FY 2020-21 in the profit and loss account.
FY 2020-21 and reached levels of last year.
Diluted 2.08 10.78 2.46 11.14
SHARE CAPITAL
Further, with overall dip in sales turnover and fixed costs
Due to rounding off, numbers presented in above table may not add up precisely to the totals provided in Financial Statements The Company’s paid-up Equity Share Capital continues to
persisting at similar levels, we have seen some contraction
in operating margins. With operating leverage to playout, we stand at ` 84,11,45,820/- made up of 8,41,14,582 Equity Shares
* Final dividend for 2021: ` 0.50 per equity share of `10 each.
expect our margins to improve once our revenues come back of ` 10/- each. During the year, the Company has not issued
to normalcy. any shares or convertible securities or shares with differential
FINANCIAL PERFORMANCE and financial results of the Company are elaborated in the voting rights options or sweat equity shares or warrants.
The performance of the Company was impacted due to the Management Discussion and Analysis Report (MDAR). In the month of April – May 2021, our Company raised funds
COVID-19 pandemic resulting in the Company reporting de- through preferential allotment of equity shares, Warrants, As on March 31, 2021, none of the Directors of the Company hold
The Consolidated Revenue from operations for FY 2020-21 instruments convertible into Equity Shares of the Company.
growth in revenue from operations of 25% over the Previous FCCBs and other debt Instruments. This will help reduce the
was ` 18,417.63 Million as compared to ` 24,379.24 Million in
Year. At Standalone level, the Revenue from operations for overall debt burden of our company. The funds will also be
the Previous Year 2019-20, registering a de-growth of 24% There is no change in the share capital during the year under
FY 2020-21 stood at ` 17,917.35 Million as compared with utilized for meeting our capex requirements over the next
The Consolidated Profit before Tax for FY 2020-21 stood at review.
` 23,912.77 Million in the Previous Year 2019-20. The Profit 2 years and would free up our cash flows during that period.
` 407.24 Million as compared to ` 1,269.56 Million in the
before Tax for FY 2020-21 stood at ` 386.67 Million as against Additionally, the proceeds would be utilised to enhance BUSINESS OVERVIEW
Previous Year 2019-20. The Consolidated Profit after tax for FY
` 1,252.12 Million in the Previous Year 2019-20. The Profit after working capital for future growth.
2020-21 stood at ` 207.05 Million as compared to ` 936.89 One of India’s leading dairy FMCG companies, Parag Milk Foods
Tax for FY 2020-21 stood at ` 174.54 Million against ` 906.38
Million in the Previous Year 2019-20. This would provide enough firepower to bolster the balance Ltd. (PMFL or the Company) was founded in 1992. The Company
Million reported in the Previous Year 2019-20. The operations
sheet and propel the company into motion for future growth. today boasts of 10+ consumer-centric products, with a focus on

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

consumers health and nutrition. From producing only fresh milk Going forward, we believe, one of the key consequences of
and Skimmed Milk Powder (SMP) at the outset, the Company the COVID-19 pandemic will be to bring back focus on healthy `749,999,916/- (Rupees Seventy Four crores Ninety-Nine milk. It is PMFL’s subsidiary with a production capacity of
has come a long way to becoming one of the market leaders of and nutritious food. As a result, consumers are expected to be lacs Ninety-Nine Thousand Nine Hundred and Sixteen) to approximately 30,000 LPD. It produces “Farm- to-Home”
a wide range of value-added consumer products such as cheese, more keen than ever to use high quality products of established International Finance Corporation (IFC) (Investor). premium milk under the brand name of “Pride of Cows”
ghee, paneer, curd, dairy based beverages, whey protein amongst brands. We believe this is a healthy trend overall, with significant (POC). Over the years the brand has gained demand from the
2. 18,01,801 equity shares of face value ` 10/- each (“Equity markets due to its unique characteristics like fresh, untouched
others. The Company has successfully combined the best aspects benefits to our society over the long term. The shift in consumer
Shares”) at a price of ` 111/- (including a premium of and unadulterated milk. Being fully automated without any
of co-operatives back-end and an efficient FMCG companies front- preference towards greater health-consciousness will trigger
` 101/-) per share, for a total consideration of human intervention the quality and safety of the milk has
end to pursue rapid growth over the years. The Company has four a switch to branded foods and products that can guarantee a
` 19,99,99,911/- (Rupees Nineteen crores ninety-nine lacs been accepted by over 20,000 households in Mumbai, Pune
highly successful brands namely Gowardhan, Go, Pride of Cows higher standard of quality, consistency and hygiene.
ninety-nine thousand nine hundred eleven only) to Sixth and Surat. The farm also operates as a R&D centre for dairy
and Avvatar. These brands together encompass a range of dairy
EXPORT MARKET Sense India Opportunities II (Investor) and farming in India that educates farmers on best practices in
industry segments – premium, modern and traditional, providing
animal feeding, rearing and milking for improving their cows’
the Company diverse growth opportunities. The Company’s Parag Milk Foods Limited continues to enjoy a strong presence
3. 27,02,702 equity shares of face value ` 10/- each (“Equity productivity. PMFL also created a bioscience division with
manufacturing facilities are strategically located at Manchar and brand recall of Go and Gowardhan brands across several
Shares”) at a price of ` 111/- (including a premium of the aim of converting waste into developing cattle feed and
in Maharashtra, Palamaner in Andhra Pradesh and Sonipat in geographies through its exports to UAE, Singapore, Mauritius,
` 101/-) per share, for a total consideration of up to organic manure for farmers. Dairy portfolio includes Milk, Fat
Haryana, to serve the markets efficiently and widen the distribution Oman, Kuwait, Saudi Arabia, Congo, Hong Kong, Philippines,
` 29,99,99,922/- (Rupees Twenty-nine crores ninety-nine Free milk, Curd and Ghee.
reach. Each plant boasts of state-of-the–art technologies. Sri Lanka, Bangladesh, Maldives, USA, Thailand, Nepal, Bhutan
lacs ninety-nine thousand nine hundred twenty-two only)
Ghana, Malaysia, Qatar etc. We have also exported Paneer to a During FY 2020-21, no new subsidiary was incorporated/
The Bhagyalaxmi Dairy Farms at Manchar, India’s largest cow farm, to Sixth Sense India Opportunities III (Investor).
major Quick Service Restaurant (QSR) across Gulf Cooperation acquired. The Company does not have any associate company,
is one of the most technologically advanced facilities in India. Council (GCC) countries. Export sales amounted to ` 327.63 Post the allotment of equity shares, paid-up share capital of nor has it entered into a joint venture with any other company.
Leveraging on innovation, diverse set of products and quality,
Million for the Financial Year ended March 31, 2021. the Company became ` 95,37,58,410/- (Rupees Ninety Five
PMFL’s goal is to become the largest dairy FMCG Company in the Pursuant to the provisions of Section 129(3) of Companies Act,
country. Our endeavor remains to continuously revise our product Crores Thirty Seven Lacs Fifty Eight Thousand Four Hundred
MATERIAL CHANGES AFFECTING THE COMPANY 2013 (“the Act”) a statement containing the salient features of
offerings to cater to diverse consumer needs. Being a vertically and Ten Only) divided into 9,53,75,841 (Nine Crores Fifty-Three
There have been material changes which have affected the financial statements of the Company’s subsidiaries in Form No.
integrated company enables PMFL to make all its products from Lacs Seventy-Five Thousand Eight Hundred and Forty One)
financial position of the Company which have occurred AOC-1 is attached as Annexure I to this report.
scratch such as milk, cheese, paneer, ghee, whey proteins and equity shares of ` 10/- (Ten) each.
between the end of financial year and the date of this report.
others. This, we believe will be a key differentiating factor for Pursuant to the provisions of Section 136 of the Act, the
Subsequently, on May 18, 2021 the Company allotted 1,500 Financial Statements of the subsidiary are uploaded on the
PMFL and is likely to result in the company extending its market Pursuant to the Board Resolutions passed in April 2021
leadership and profitability across product categories over the (One Thousand Five Hundred) Unlisted, Secured, Redeemable, website of the Company i.e. www.paragmilkfoods.com under
and Shareholders Resolution vide Extra-Ordinary General Non-Convertible Debentures (NCDs) having Face Value of `
medium to long term. Currently, we have pan-India distribution ‘Investors’ tab. Any Member desirous of having a copy of the
Meeting held on April 26, 2021 the Company was authorized 10,00,000/- (Rupees Ten Lakhs Only) each, aggregating to `
with more than 3,50,000 retail touch points. We have 21 depots Financial Statements of the subsidiary company can obtain
to raise funds via Issue of Non-Convertible Debentures (NCD),
and are connected with over 3,000 distributors and 200+ super 150,00,00,000/- (Rupees One Hundred Fifty Crores Only) on the same from the Company by making a written request in
Convertible Warrants, Equity Shares and Foreign Currency
stockists across the country. We engage with our consumers at Private Placement basis to International Finance Corporation this regard.
Convertible Bonds (FCCBs).
these touch points through an 800+ member strong sales and (IFC).
marketing team. In the year where across the industry, product Performance highlights of the subsidiary is given below:
During the month of April and May 2021, the Company had
launches had taken a backseat, we continued to roll out new Lastly, the Company on May 28, 2021 allotted 10,680 (Ten (` in Million)
issued and allotted Non-Convertible Debentures (NCDs),
products – Ghee and Curd under our premium brand, Pride of Thousand Six Hundred Eighty Only) unlisted, unsecured,
Convertible Warrants on Preferential Basis, Equity Shares on
Cows and introduced Grated Paneer and Star curd under our unrated foreign currency convertible bonds (“FCCBs”) of Sr. No. Particulars FY 2020-2021 FY 2019-2020
Preferential Basis and Foreign Currency Convertible Bonds
flagship Gowardhan brand. face value of US$1000 each aggregating to US $10,680,000
(FCCBs) on Private Placement basis. 1. Total Revenue 686.99 772.00
(Dollars Ten Million Six Hundred and Eighty Thousand) by
The year FY20-21 was a challenging year posed by impact of private placement to International Finance Corporation (“IFC”). 2. Profit before Interest, 47.36 40.71
The Company allotted 1,00,00,000 Warrants to Mr. Devendra
first wave of COVID-19 and later the more gruelsome second Tax and Depreciation
Prakash Shah and Mrs. Netra Pritam Shah belonging to the
wave, wherein a part of our business that comes out of home SUBSIDIARY 3. Profit after Tax 32.52 30.51
Promoter and Promoter Group on May 10, 2021 at a price of
consumption suffered and impacted the overall topline. In In terms of the provisions of Securities and Exchange Board
` 111/- (including a premium of ` 101/-) per warrant entitling
these trying times we stayed firm with all our stakeholders from of India (Listing Obligations and Disclosure Requirements) CONSOLIDATED FINANCIAL STATEMENTS
farmers, to vendors to supply chain and logistics partners, and them for the subscription of equivalent number of equity
Regulations, 2015 (“SEBI Listing Regulations”), the Board Pursuant to the provisions of Section 129 of the Companies
navigated the tough times and came out lean and strong. On shares of ` 10/- each at ` 111/- each {Including premium of
has approved a Policy for determining material subsidiaries. Act, 2013 and the Companies (Accounts) Rules, 2014, the
the raw material front, the milk prices continue to remain on an ` 101/- per share) as per the provisions of Chapter V of the
The same is also available on the website of the Company at Consolidated Financial Statements of the Company and its
upswing, and peaked in Q4FY20, impacting our margins. We Securities and Exchange Board of India (Issue of Capital
www.paragmilkfoods.com . Further, in terms of the said policy, subsidiaries have been prepared in the same form and manner
consolidated our focused categories and continued our work and Disclosure Requirements) Regulations, 2018 (“ICDR
the Company does not have a material subsidiary. as mandated by Schedule III to the Companies Act, 2013 and
on driving greater efficiencies in product management and Regulations”).
shall be laid before the forthcoming 29th Annual General
consumer outreach. The Company has 1 Wholly Owned Subsidiary (WOS) as on Meeting (AGM) of the Company.
Consecutively, the Company allotted 1,12,61,259 Equity Shares
March 31, 2021. There has been no material change in the
Despite Pandemic, we continued with our launch initiatives and of ` 10/- each at a price of ` 111/- (including a premium of The Consolidated Financial Statements of the Company
nature of the business of the subsidiary.
during the year we expanded our premium Pride of Cows offering ` 101/-) per equity share to Non-Promoters. Out of the total have also been prepared in accordance with the relevant
with the launch of Pride of Cows single origin Ghee and Pride of 1,12,61,259 Equity Shares, the Company allotted: Bhagyalaxmi Dairy Farms Private Limited: Wholly Owned Accounting Standards issued by Ministry of Corporate Affairs
Cow Curd. Subsidiary of the Company (“MCA”) forming part of this Annual Report. In accordance with
1. 67,56,756 equity shares of face value ` 10/- each (“Equity
Bhagyalaxmi is India’s first modern dairy farm consisting of Section 136 of the Companies Act, 2013, the Audited Financial
We are one of the few ‘farm-to-fork’ dairy FMCG companies in Shares”) at a price of ` 111/- (including a premium of
2300 Holstein Frieisan cows, equipped with state-of-the- Statements, including the Consolidated Financial Statements
India giving us complete control of the quality of our products. ` 101/-) per share, for a total consideration of
art technology for feeding, milking and processing of fresh and related information of the Company and Audited Accounts

76 77
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

of its subsidiary are available on Company’s website at www. Independent Directors maintained with the Indian Institute Policy on Appointment and Remuneration of Directors, Key INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR
paragmilkfoods.com. of Corporate Affairs in terms of Section 150 of the Act read Managerial Personnel and Senior Management Personnel ADEQUACY
with Rule 6 of the Companies (Appointment & Qualification of
The Board of Directors has formulated a Nomination and
DIRECTORS AND KEY MANAGERIAL PERSONNEL Directors) Rules, 2014. The details in respect of internal financial control and their
Remuneration Policy in terms of the provisions of subsection (3)
Change in Directorate adequacy are included in the Management Discussion and
Board Evaluation of Section 178 of the Act and Regulation 19 of the SEBI (Listing
During the year under review, Mr. Sunil Goyal on completion of Analysis, which forms a part of the Annual Report.
Obligations and Disclosure Requirements) Regulations, 2015
his 1st term of 5 years as Independent Director discontinued The Company has devised a policy for the performance
dealing with appointment and remuneration of Directors, Key RISK MANAGEMENT FRAMEWORK
from the Board of the Company w.e.f. May 25, 2020. evaluation of the individual directors, Board and its
Committees, which also includes the criteria for carrying out Managerial Personnel and Senior Management.
Risk management is embedded in the Company’s operating
Appointment / Re-appointment: the said performance evaluation. Pursuant to the provisions The policy covers criteria for determining qualifications, framework. The Company’s approach to addressing
In the FY 2020-21, Mr. Narendra Ambwani and Ms. Radhika of the Act and Regulation 17(10) of Listing Regulations and positive attributes, independence and remuneration of its business risks is comprehensive and includes periodic
Dudhat were re-appointed as Independent Director to hold as prescribed in the stated policy of the Board, the Board Directors, Key Managerial Personnel and Senior Management. review, evaluation and monitoring key risks and reviewing
office for a second term of 5 (five) consecutive years on the has carried out an annual performance evaluation of (i) the the measures taken for management and mitigation and
Directors (Independent and non-independent); (ii) itself (as a The said Policy is available on the website of the Company
board of the company with effect from May 26, 2020 and Mr. effectiveness thereof, mitigating and reporting mechanism of
whole); (iii) its committees and (iv) fulfillment of Independence viz. www.paragmilkfoods.com.
Nitin Dhavalikar was re-appointed as Independent Director to such risks. The Company believes that managing risks helps
criteria. The Board performance was evaluated based on inputs in maximising returns. The risk management framework is
hold office for a second term of 5 (five) consecutive years with DIRECTORS’ RESPONSIBILITY STATEMENT
received from the Board members after considering criteria reviewed periodically by the Board and the Audit Committee.
effect from July 28, 2020.
such as Board composition and structure, effectiveness of Pursuant to the requirements under Section 134(3)(c) of The Audit Committee has additional oversight in the area of
The Board consists of seven directors , viz. two Promoter Board / Committee processes, and information provided to the the Companies Act, 2013, with respect to the Director’s financial risks and controls.
Directors, one Non-Executive Non Independent Director and Board, etc. In terms of the requirements of the Act, a separate Responsibility Statements, your Directors make the
four Independent Directors including one Independent Woman meeting of the Independent Directors was also held during the following statements The risks faced by the Company and the various measures
Director. This meets with the requirements of the Companies year. taken by the Company are detailed in Management Discussion
a) that in the preparation of the annual financial statements and Analysis section.
Act, 2013 and rules framed thereunder and the requirements
The meeting of Independent Directors was held by video- for the Financial Year ended March 31, 2021, the
under SEBI (Listing Obligations & Disclosure Requirements)
conferencing on March 20, 2021 due to COVID-19 pandemic applicable accounting standards have been followed VIGIL MECHANISM / WHISTLE BLOWER POLICY
Regulations, 2015, as amended.
to review the performance of the Chairman, Non-Independent along with proper explanation relating to material The Company has a whistle blower policy encompassing
In accordance with the provisions of Section 152 of the Director of the Company and the performance of the Board as a departures, if any; vigil mechanism pursuant to the requirements of the section
Companies Act, 2013 and the Memorandum & Articles of whole, committees as mandated by Schedule IV of the Act and 177(9) of the Companies Act, 2013 and regulation 22 of the
SEBI Listing Regulations. The Directors also discussed the quality, b) that the Directors had selected such accounting policies
Association of the Company, Mr. Devendra Shah, whole time SEBI Listing Regulations. The Audit Committee reviews the
quantity and timeliness of flow of information between the Company and applied them consistently and made judgments and
director, retires by rotation, and being eligible offers himself functioning of the whistle blower policy. The policy/vigil
management and the Board, which is necessary for the Board to estimates that are reasonable and prudent so as to give
for reappointment mechanism enables directors and employees to report directly
effectively and reasonably perform their duties. The feedback of a true and fair view of the state of affairs of the Company to the management their concerns about unethical behaviour,
Key Managerial Personnel (KMP) the meeting was shared with the Chairman of the Company. at the end of the Financial Year and of the profit and loss any actual or suspected fraud or violation of the Company’s
Pursuant to the provisions of Section 2(51) and Section 203 of the Company for the Financial Year ended March 31, code of conduct or ethics policy and leak or suspected leak of
For the year under review, the Board carried out the evaluation 2021.
of the Act read with Rules framed thereunder, the following unpublished price sensitive information (“UPSI”). More details
of its own performance and that of its Committees and the
are the Key Managerial Personnel of the Company as on c) that the Directors had taken proper and sufficient are given in Corporate Governance Report.
individual Directors and the evaluation results, as collated and
March 31, 2021 care for the maintenance of adequate accounting
presented, were noted by the Board. The Company has adopted a ‘Whistle-Blower Policy’ for
records in accordance with the provisions of this Act Directors and Employees to report genuine concerns and to
1. Mr. Devendra Prakash Shah - Whole time Director Familiarization Programme for Independent Directors for safeguarding the assets of the Company and for provide adequate safeguards against victimization of persons
2. Mr. Pritam Prakash Shah - Managing Director Pursuant to Regulation 25(7) and 46 of the SEBI Listing preventing and detecting fraud and other irregularities; who may use such mechanism.
3. Mr. Shashikant Dalmia - Chief Financial Officer Regulations, the details of the familiarisation programme
d) that the directors had prepared the annual financial
imparted to the Directors are explained in the Report on The functioning process of this mechanism has been more
4. Ms. Rachana Sanganeria - Company Secretary & statements for the Financial Year ended March 31, 2021
Compliance Officer Corporate Governance and the familiarization policy is also elaborately mentioned in the Corporate Governance Report
on a going concern basis;
available on the Company’s website i.e. www.paragmilkfoods. forming a part of this Annual Report. The Whistle Blower
5. Mr. Venkat Shankar - Chief Executive Officer (CEO)-
com under ‘Investors’ tab. e) that proper internal financial controls were in place Policy has been uploaded on the Company’s website i.e.
resigned w.e.f June 29, 2020
and that the financial controls were adequate and were www.paragmilkfoods.com
Meetings of the Board of Directors
Declaration by Independent Directors operating effectively; and
During the year under review the Board of Directors met four CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Company has received necessary declaration from all the f) that systems to ensure compliance with the provisions
times. The details are given in the Corporate Governance The Company has constituted a Corporate Social
four Independent Directors under Sub-section 7 of Section of all applicable laws were in place and were adequate
Report which forms a part of the Annual Report. Responsibility (“CSR”) Committee in accordance with Section
149 of the Companies Act, 2013 that they meet the criteria of and operating effectively. 135 of the Companies Act, 2013. Details of the composition
independence as provided in Sub-Section 6 of Section 149 of Meetings of the Audit Committee are given separately as part of the Corporate Governance
the Companies Act, 2013. DISCLOSURE REGARDING ISSUE OF EMPLOYEE STOCK
During the year under review, the Audit Committee met four Report. The Company has undertaken the CSR activities in
OPTIONS
The Independent Directors have complied with the Code of times i.e. on June 29, 2020, September 7, 2020, November accordance with the CSR Policy of the Company adopted in
Conduct prescribed in Schedule IV to the Act 9, 2020 and February 5, 2021.. The details of the meetings, Details required to be provided under Section 62 of the Act, and accordance with Schedule VII of the Act. The Company has
composition and terms of the reference of the Committee are Rule 12(9) of Companies (Share Capital and Debenture) Rules, revised the policy on Corporate Social Responsibility (‘CSR’)
The Independent Directors of the Company have confirmed given in the Corporate Governance Report which forms a part 2014 and SEBI (Share Based Employee Benefits) Regulations, to include changes based on Companies (Corporate Social
that they have registered their names in the data bank of of the Annual Report. 2014 are set out as Annexure - II to this Report. Responsibility Policy) Amendment Rules, 2021 and the revised

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

policy as recommended by the CSR Committee and approved (31) of Section 2 and Section 73 of the Companies Act, 2013 disclosed in terms of the provisions of Section 197(12) of the Act Certificate from M/s. Harshad Deshpande & Associates,
by the Board can be accessed on the Company’s website at (“the Act”) and the Rules framed thereunder. As on March 31, and Rule 5 of the Companies (Appointment and Remuneration Cost Accountants, has been received to the effect that their
www.paragmilkfoods.com under ‘investors ‘tab. 2021, there were no deposits lying unpaid or unclaimed. of Managerial Personnel) Rules, 2014, is annexed to this Report appointment as Cost Auditor, if made, would be in accordance
as Annexure V. with the limits specified under Section 141 of the Act and Rules
The brief outline of the CSR policy of the Company and the PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT framed thereunder.
initiatives undertaken by the Company on CSR activities during WORKPLACE SIGNIFICANT / MATERIAL ORDERS PASSED BY THE REG-
the year under review are set out in Annexure III of this report ULATORS SECRETARIAL AUDIT REPORT
In line with the provisions of the Sexual Harassment of Women
in the format prescribed in the Companies (Corporate Social
at Workplace (Prevention, Prohibition and Redressal) Act, 2013 There were no significant and material orders passed by the Pursuant to the provisions of Section 204 of the Act and
Responsibility Policy) Amendment Rules, 2021. The initiatives
(“POSH Act”), the Company has adopted an internal Policy Regulators/Courts that would impact the going concern status Rule 9 of the Companies (Appointment and Remuneration of
undertaken by the Company on CSR activities during the year
under review are set out in this report in the format prescribed on Sexual Harassment at Workplace (Prevention, Prohibition of the Company and its future operations. Managerial Personnel) Rules, 2014, the Company has appointed
under Rule 9 of Companies (Corporate Social Responsibility and Redressal). The policy is applicable for all employees of M/s. N. L. Bhatia & Associates, a firm of Company Secretaries
the organization, which includes corporate office, branches, COMPLIANCE WITH SECRETARIAL STANDARDS in Practice, to undertake the Secretarial Audit of the Company
Policy) Rules, 2014 and are annexed as Annexure III and form
an integral part of this Report. depots and manufacturing locations etc. The policy is During the year under review and in terms of Section 118(10) of for the financial year 2020-21. The Secretarial Audit Report in
applicable to non-employees as well i.e. business associates, the Act, the Company has complied with Secretarial Standards Form MR-3 is annexed as Annexure VI to this Report. The said
RELATED PARTY TRANSACTIONS vendors, trainees etc. on meetings of the Board of Directors (“SS-1”) and on General Secretarial Audit Report does not contain any qualifications,
Related Party Transactions entered into during the year under Meetings (“SS-2”) as amended and issued from time to time by reservations or adverse remarks and no frauds were reported
review were approved by the Audit Committee and the Board The Company has complied with provisions relating to the The Institute of Company Secretaries of India. by the Secretarial Auditors to the Company under sub-section
of Directors, from time to time and the same are disclosed in constitution of Internal Complaints Committee under the POSH (12) of Section 143 of the Act and therefore no detail is required
the Financial Statements of the Company for the year under Act to redress complaints received on sexual harassment as well STATUTORY AUDITORS to be disclosed under Section 134 (3)(ca) of the Act.
review. Further, pursuant to the provisions of the Act and as other forms of verbal, physical, written or visual harassment. At the 28th Annual General Meeting of the Company, the
the SEBI Listing Regulations, the Board of Directors has, on Shareholders had approved the appointment of M/s. Sharp & Further, in terms of the provisions of the Circular No. CIR/CFD/
recommendation of the Audit Committee, adopted a Policy on During the financial year under review, the Company did not Tannan, Chartered Accountants, Mumbai (Firm Registration CMD1/27/2019 dated 8th February, 2019 issued by Securities
Related Party Transactions and the said policy is available on receive any complaints of sexual harassment and no cases No.109982W) as the Statutory Auditors of the Company, to and Exchange Board of India, the Company has obtained
the website of the Company i.e. https://www.paragmilkfoods. were filed under the POSH Act. hold office for a period of 5 (five) years from the 28th Annual the Annual Secretarial Compliance Report for the financial
com/investors.php. General Meeting of the Company till the conclusion of the year ended 31st March, 2021, confirming compliance of the
MANAGEMENT DISCUSSION AND ANALYSIS REPORT,
33rd Annual General Meeting of the Company, in terms of the applicable SEBI Regulations and circulars/ guidelines issued
In terms of the provisions of Section 188(1) of the Act read CORPORATE GOVERNANCE REPORT AND BUSINESS RE-
applicable provisions of Section 139(1) of the Act read with the thereunder, by the Company.
with the Companies (Meetings of Board and its Powers) Rules, SPONSIBILITY REPORT Companies (Audit and Auditors) Rules, 2014.
2014 and Regulation 23 of the SEBI Listing Regulations, all In terms of Regulation 34 of SEBI Listing Regulations, a ACKNOWLEDGEMENTS
contracts/ arrangements/ transactions entered into by the separate section on Management Discussion and Analysis, The Auditors’ Report on the Financial Statements (Standalone Your Directors wish to place on record their deep sense of
Company with its related parties, during the year under review, Business Responsibility Report and Corporate Governance and Consolidated) of the Company for the year under review, appreciation for the committed services by your Company’s
were in the ordinary course of business of the Company and is clean and there are no qualifications in their Report. Also, no
Report together with a certificate from a Practicing Company employees. Your Directors acknowledge with gratitude,
on arm’s length basis. There were no material Related Party frauds in terms of the provisions of Section 143(12) of the Act
Secretary confirming compliance with the Regulations relating the encouragement and support extended by our valued
transactions during the year. Accordingly, Form No. AOC-2, have been reported by the Statutory Auditors in their report for
to Corporate Governance of SEBI Listing Regulations are set shareholders.
prescribed under the provisions of Section 134(3)(h) of the the year under review.
out and form part of this Annual Report.
Act and Rule 8 of the Companies (Accounts) Rules, 2014, for
Your directors place on record their appreciation for the
disclosure of details of Related Party Transactions, which are CONSERVATION OF ENERGY, TECHNOLOGY ABSORP- The Notes to the Financial Statements (Standalone and
support and co-operation the Company has been receiving
“not at arm’s length basis” and also which are “material and Consolidated) are self-explanatory and do not call for any
TION AND FOREIGN EXCHANGE EARNINGS AND OUTGO from its suppliers, distributors, retailers, business partners and
at arm’s length basis”, is not provided as an annexure to this further comments.
Company continues its efforts to reduce and optimize the others associated with it as its trading partners. The Company
Report as it is not applicable.
energy consumption at all of its manufacturing facilities, COST AUDITORS looks upon them as partners in its progress and has shared
PARTICULARS OF LOANS GRANTED, GUARANTEE GIVEN including corporate offices at Pune and Mumbai. with them the rewards of growth. The Directors regret the loss
In terms of the provisions of Section 148 of the Act, the Company
AND INVESTMENTS MADE PURSUANT TO THE PROVISIONS of life due to COVID-19 pandemic and are deeply grateful and
had appointed M/s. Harshad Deshpande & Associates, Cost
OF SECTION 186 OF THE COMPANIES ACT, 2013 Particulars relating to conservation of energy, technology have immense respect for every person who risked their life
Accountants, Pune (Firm Registration Number: 00378), as
The loans given, investments made and guarantees given absorption, foreign exchange earnings and outgo as required and safety to fight this pandemic.
the Cost Auditor to conduct an audit of its Cost Accounting
& securities provided during the year under review, are to be disclosed under Section 134(3)(m) of the Companies Act,
Records for the financial year 2020-21, pertaining to products The Board of Directors also take this opportunity to thank
in compliance with the provisions of Section 186 of the 2013 read with Rule 8(3) of the Companies (Accounts) Rules,
of the Company as required by the law. The Cost Audit Report all farmers, consumers, employees, Shareholders, Clients,
Companies Act, 2013, and the Rules thereunder and details 2014 are provided in the prescribed format and enclosed as
submitted by the Cost Auditor, was clean and there was no Vendors, Banks, Government and Regulatory Authorities and
of loans given and investments made in accordance with Annexure IV.
qualification in their Report. Stock Exchanges, for their continued support.
Schedule V of the Listing Regulations, have been disclosed in
the financial statements. ANNUAL RETURN
Further, the Company has re-appointed M/s. Harshad
Pursuant to Section 92(3) read with Section 134(3)(a) of the Deshpande & Associates, Cost Accountants, as the Cost
BUY BACK Act, the Annual Return as on March 31, 2021 is available on Auditor for the Financial Year 2021-22, to conduct an audit of For and on behalf of the Board of Directors
The Company has not bought back any of its securities during the website of the Company in the following link https://www. its Cost Accounting Records pertaining to said products, at a Parag Milk Foods Limited
the Financial Year ended March 31, 2021. paragmilkfoods.com/investors.php. remuneration of ` 1,00,000 p.a. (Rupees One Lac) plus Goods
and Service tax and out of pocket expenses. The Company
DEPOSITS PARTICULARS OF EMPLOYEES AND RELATED is seeking the approval of the Shareholders by means of
DISCLOSURES Devendra P. Shah
The Company does not accept and/or renew Fixed Deposits ratification, for the remuneration to be paid to M/s. Harshad
from the general public and shareholders. The Company has Disclosure comprising particulars with respect to the Deshpande & Associates, Cost Accountants vide Resolution Place :Mumbai Chairman
not accepted any deposits within the meaning of sub-section remuneration of directors and employees, as required to be No. 4 of the Notice of the ensuing Annual General Meeting. Date :July 29, 2021 DIN: 01127319

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

ANNEXURE – I ANNEXURE – II
Form AOC-1
(Pursuant to first proviso to sub-section (3) of Section 129 read with Rule 5 of Companies (Accounts) Rules, 2014) Details of Employee Stock Options Scheme under Section 62 of the Companies Act , 2013 read with rule 12(9) of the Companies
(Share Capital and Debentures) Rules, 2014 and Securities and Exchange Board of India (Share Based Employee Benefits)
Statement containing salient features of the financial statement of subsidiaries / associate companies / joint ventures as per the Regulations, 2014
Companies Act, 2013 for the financial year ended March 31, 2021
The details of activity under ESOS 2018 are summarized below:
(Amount in Million)
Particulars Year ended March 31, 2021 Year ended March 31, 2020
1 Name of the Subsidiary Bhagyalaxmi Dairy Farms Private Limited No. of options WAEP (`) No. of options WAEP (`)
2 The date since when subsidiary was acquired December 2, 2003 Outstanding at the beginning of the year 1,15,765 258.9 1,66,015 258.9
3 Reporting period for the subsidiary - concerned, if different from the holding April 1, 2020 to March 31, 2021 Granted during the year - - - -
company's reporting period Forfeited/lapsed during the year 13,726 258.9 50,250 258.9
4 Reporting Currency and Exchange rate as on the last date of the relevant - Indian Rupees Exercised during the year - - - -
Financial year in the case of foreign subsidiaries
Outstanding at the end of the year of which Options vested 1,02,039 258.9 1,15,765 258.9
5 Share Capital (`) 57.85 and exercisable at the end of the year
6 Reserves & Surplus 648.1
7 Total Assets 1102.93
8 Total Liabilities 396.98
9 Investments 0.003 For and on behalf of the Board of Directors
10 Turnover (total revenue including other income) 686.99
11 Profit/ (Loss) before Taxation 20.58

12 Tax Expense/ (Benefit) (11.94)
Devendra P. Shah
13 Profit/ (Loss) after Taxation 32.52
Place : Mumbai Chairman
14 Other Comprehensive Income 0.09 Date : July 29, 2021 DIN: 01127319
15 Total Comprehensive Income 32.61
16 Proposed Dividend Nil
17 % of shareholding 100.00%

NOTE:

1. The Company does not have any Associate / Joint Venture Company.

For and on behalf of the Board of Directors

Devendra P.Shah Pritam P.Shah
Place : Mumbai Chairman Managing Director
Date : July 29 2021 DIN: 01127319 DIN: 01127247

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

ANNEXURE – III 4. IN CASE THE COMPANY HAS FAILED TO SPEND THE TWO PERCENT OF THE AVERAGE NET PROFIT OF THE LAST
THREE FINANCIAL YEARS OF ANY PART THEREOF, THE COMPANY SHALL PROVIDE THE REASONS FOR NOT
CORPORATE SOCIAL RESPONSIBILITY ACTIVITIES SPENDING THE AMOUNT IN ITS BOARD REPORT –
[Pursuant to Section 135 of the Companies Act, 2013 and as per Rule 8(1) of Companies The Company had failed to spend ` 10.96 Million in FY 2019-20 due to outbreak of pandemic COVID-19. However, in the
(Corporate Social Responsibility Policy) Rules, 2014]
Current FY 2020-21, the Company spent in excess of ` 11.81 Million towards CSR Expenditure. The Company proposes to
set-off the excess amount spent in the current FY with the deficiency of the previous year 2019-20.

1. BRIEF OUTLINE ON CSR POLICY OF THE COMPANY 5. DETAILS OF THE AMOUNT AVAILABLE FOR SET OFF IN PURSUANCE OF SUB-RULE (3) OF RULE 7 OF THE COMPA-
The Company has framed a CSR Policy in compliance with the provisions of the Companies Act, 2013 and Rules made NIES (CORPORATE SOCIAL RESPONSIBILITY POLICY) RULES, 2014 AND AMOUNT REQUIRED FOR SET OFF FOR
thereunder. The CSR Policy provides for carrying out CSR activities in respect of those areas as provided in Schedule VII THE FINANCIAL YEAR, IF ANY
of the Companies Act, 2013. The Company shall take up activities mentioned in its policy as and when fruitful opportunity In the FY 2020-21, the Company spent in excess of ` 11.81 Million towards CSR Expenditure. The Company does not propose
exists. to set-off against the spend under section 135(5).

The Board of Directors of the Company has revised the CSR Policy as recommended by the Committee in line with the CSR Sr. Financial Year Amount available for set-off from preceding Amount required to be setoff for the financial
Policy Amendment Rules, 2021. No. financial years (in ` ) year, if any (in ` )

As part of its initiative, under the Corporate Social Responsibility (“CSR”) Company continues to contribute to Panjrapole 1. 2020-2021 Nil Nil
where all cattle are accepted free of cost and are nurtured, taken care of and other stray cows and animals are protected. To TOTAL Nil
empower the community around the local vicinity the Company has undertaken activities promoting education, healthcare,
social welfare and help to the local farmers and rural development in accordance with the CSR Policy of the Company, read 6. AVERAGE NET PROFIT OF THE COMPANY AS PER SECTION 135(5) – ` 1411.78 Million
with Schedule VII of the Act. Also, the Company contributed towards COVID-19 expenses in Maharashtra and Palamner 7. DETAILS OF:
relating to promotion of health care including preventive health care and sanitation, and disaster management in accordance a. Two percent of average net profit of the company as per section 135(5) – ` 28.24 Million
with General Circular No. 10/2020 and 15/2020 issued by MCA via Clarification on spending of CSR Funds for COVID-19.
b. Surplus arising out of the CSR projects or programmes or activities of the previous financial years – Nil
Besides COVID-19 related initiatives and expenses in Maharashtra and Palamner, further community development and CSR
initiatives are as below: c. Amount required to be set off for the financial year- Nil

• Promotion of Education in Maharashtra d. Total CSR Obligation for Financial Year (7a + 7b + 7c) – ` 28.24 Million

• Contributing to Panjrapole, where all cattle are accepted free of cost, to nurture and care for animals in distress and 8. (a) CSR amount spent or unspent for the financial year:
protect these stray cows & other stray animals (Ensuring Environmental Sustainability)
Total Amount Amount Unspent (in ` )
• 3,000+ people are being provided with healthy meals prepared in the company canteen on a daily basis. Spent for the Total Amount transferred to Unspent Amount transferred to any fund specified under
Financial Year. CSR Account as per section 135(6). Schedule VII as per second proviso to section 135(5).
• Sanitisation of Manchar and nearby villages. (in ` )
Amount. Date of transfer Name of the Fund Amount. Date of transfer
• Covid-19 Awareness program conducted in surrounding school and colleges. ` 40.05 Million NA NA NA NA NA

• At the plant, immunity booster foods were provided to local people. (b) Details of CSR amount spent against ongoing projects for the financial year: NIL

• Assisted local hospitals & their staff (COVID warriors) by providing them essential equipment & food. (c) Details of CSR amount spent against other than ongoing projects for the financial year:

2. COMPOSITION OF CSR COMMITTEE 1 2 3 4 5 6 7 8

Sr. Name of Director / Designation / Nature of Number of meetings of Number of meetings Sr. Name of the Item from Local Location of the project Amount Mode of Mode of
No. Member Directorship CSR Committee held of CSR Committee No. Project the list of area spent for implementation implementtation
during the year attended during the year activities in (Yes/ the project on- Direct -Through
Schedule VII No) (in Million.) (Yes/No) implementing
1. Mr. B. M. Vyas Chairman - Non Executive Director 1 1 to the Act agency
2. Mr. Devendra Shah Member - Executive Director 1 1 State District Name CSR
3. Ms. Radhika Dudhat Member - Independent Director 1 1 registration
Number
4. Mr. Narendra Ambwani Member - Independent Director 1 1
1. Education Promoting Yes Maharashtra Manchar 0.83 Yes NA NA
3. PROVIDE THE WEB-LINK WHERE COMPOSITION OF CSR COMMITTEE, CSR POLICY AND CSR PROJECTS AP- Education
PROVED BY THE BOARD ARE DISCLOSED ON THE WEBSITE OF THE COMPANY. 2. Contributing Animal Yes Maharashtra Manchar 24.46 Yes NA NA
to Panjrapole. Welfare
These details are disclosed on the Company’s website at www.paragmilkfoods.com.
3. COVID-19 COVID – 19 Yes Maharashtra Manchar 14.76 Yes NA NA
Expenses Expense & Andhra &
Pradesh Palamner
TOTAL 40.05

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 Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

(d) Amount spent in Administrative Overheads - Nil

Annexure-IV
(e) Amount spent on Impact assessment - Nil
Conservation of Energy, Technology Absorption and Foreign Exchange Earning & Outgo
(f) Total amount spent for financial year (8b+8c+8d+8e) – ` 40.05 Million
[Section 134(3)(m) of the Companies Act, 2013 Read with Rule8(3) of the Companies (Accounts) Rules, 2014]
(g) Excess Amount for Set off, if any – Nil
A. CONSERVATION OF ENERGY
Sr. Particular Amount
Company is engaged in processing of milk and manufacturing of Milk products. Total consumption during the financial year
No. (in Million ` )
2020-21 is given in the form as below.
i. Two percent of average net profit of the company as per section 135(5) 28.24
ii. Total amount spent for the Financial Year 40.05 Sr. No. Power and Fuel Consumption Total Units
iii. Excess amount spent for the financial year [(ii)-(i)] 11.81 1 Electricity Consumption (Total No. of Units) 3,76,17,780
iv. Surplus arising out of the CSR projects or programmes or activities of the previous financial Nil 2 Own Generator through T.G. Set (Units) 26,24,322
years, if any 3 D.G. Unit 3,73,507
v. Amount available for set off in succeeding financial years [(iii)-(iv)] Nil 4 Diesel / SKO consumed (LTR) 2,73,801

9. A. Details of Unspent CSR amount for the preceding three financial years – Unspent Amount of ` 10.96 Million in 5 Furnace Oil Consumed (LTR) 2,05,360
FY 2019-20 6 Coal (kg) 3,90,50,707
B. Details of CSR amount spent in the financial year for ongoing projects of the preceding financial year(s) – Nil
B. STEPS TAKEN DURING THE YEAR FOR ENERGY CONSERVATION
10. IN CASE OF CREATION OR ACQUISITION OF CAPITAL ASSET, FURNISH THE DETAILS RELATING TO THE ASSET SO During the financial year 2020-21 the following steps were undertaken by the Company which resulted in saving in energy
CREATED OR ACQUIRED THROUGH CSR SPENT IN THE FINANCIAL YEAR (ASSET-WISE DETAILS): consumption.
Date of creation or acquisition of the capital asset(s) – Not Applicable
1. We have installed VFD (Variable frequency drive) on air compressor & refrigeration compressor.
Amount of CSR spent for creation or acquisition of capital asset – Nil
2. Improved regeneration efficiency of various heat exchangers.
Details of the entity or public authority or beneficiary under whose name such capital asset is registered, their
3. Minimising stack loss of boiler.
address etc. – Not Applicable
4. Identification & replacement of inefficient pumps with new generation efficient pumps.
Provide details of the capital asset(s) created or acquired (including complete address and location of the
capital asset) – Not Applicable 5. Replacement of existing pneumatic ghee packing machine with mechanical packing machine with servo injection.
New machine power consumption is 1.5KW, whereas Old machine consumed 5.0KW. Also new machine doesn’t require
11. SPECIFY THE REASON(S), IF THE COMPANY HAS FAILED TO SPEND TWO PER CENT OF THE AVERAGE NET PROFIT
Compressed Air.
AS PER SECTION 135(5) – Not Applicable
6. Installed Variable frequency Drive (400KW) on various equipments at Lactose plant.

7. Installed sealing – cooling Water recirculation arrangement for Lactose Evaporator plant.
For and on behalf of the Board of Directors
8. In Cheese Plant: Replaced 1 X 4 Fixture T5 –55Watt with LED Light - 16 Watt.(Total 60Fixtures replaced.)

C. RESEARCH AND DEVELOPMENT (R&D)

Our Research & Development team works continuously in developing new products as well as improvement of processes.
Devendra P. Shah B. M. Vyas During the year, the team developed “Pride of Cows’ single-origin Ghee with distinct production process, aroma, taste as
Place : Mumbai Chairman Chairman of CSR Committee well as packaging. Further, the team developed “Pride of Cows’ Curd with rich taste and thickness in a unique packaging. The
Date : July 29, 2021 DIN: 01127319 DIN: 00043804 team has also developed newer consumer products like “Four-Cheese’ pack containing a mix of 4 different natural cheese,
readily grated and use in variety of cuisines.

The team also augmented production process for Whey Permeate Powder (WPP) production, thereby increasing the recovery
of solids.

The team is now working on developing a range of milk shakes and other drinks, to be launched later during the year.

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

D. FOREIGN EXCHANGE EARNINGS AND OUTGO

Following are the details of the foreign exchange earned and used during the financial year 2020-21
Annexure –V
Disclosure in Board’s Report as per the provisions of Section 197(12) of the Companies Act, 2013 read with
(` In Millions) Rule (5) (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
Particulars 2020-21 2019-20
S.No. Disclosure Requirement Disclosure Details
Foreign exchange earned 327.63 383.2
1. The ratio of the remuneration Name of the Category Ratio ( In x No. of ESOPs
Foreign exchange used 290.74 272.86
of each Director to the median Directors times) granted
E. TECHNOLOGY ABSORPTION remuneration of the employees of during 2020
the Company for the financial year Mr. Devendra Shah Executive Chairman- 97.74 N. A.
1. We have installed VFD (Variable frequency drive) on air compressor & refrigeration compressor.
2020-21. Whole time Director
2. Improved regeneration efficiency of various heat exchangers. Mr. Pritam Shah Managing Director 97.74 N. A.

3. Minimising stack loss of boiler. Mr. B. M. Vyas Non-Executive Director 32.99 N. A.

Mr. Ramesh Independent Director - -
4. Identification & replacement of inefficient pumps with new generation efficient pumps. Chandak
5. Commissioning of 850KW Bio gas Engine for own electricity generation Mr. Narendra Independent Director - -
Ambwani
6. Replacement of inefficient refrigeration system with high performance equipment’s.
Mr. Nitin Dhavalikar Independent Director - -
7. Replacement of Old motors with high efficiency motors. Ms. Radhika Independent Director - -
Dudhat
a. The median remuneration of all the employees of the Company was
20,462.50.
b. For this purpose, Sitting Fees paid to the Directors has not been considered
as remuneration.
c. Figures have been rounded off wherever necessary.

2. The percentage increase in Name of the Category % Increase in

remuneration of each Director, Chief Directors remuneration
Financial Officer and Company Mr. Devendra Shah Executive Chairman- N.A.
Secretary during the financial year Whole Time Director
2020-21.
Mr. Pritam Shah Managing Director N.A.
Mr. B. M. Vyas Non-Executive Director N.A.
Mr. Shashikant Chief Financial Officer 26.87%
Dalmia
Ms. Rachana Company Secretary & N.A.
Sanganeria Compliance Officer
3. The percentage increase/decrease The percentage increase in the median remuneration of employees in the
in the median remuneration of financial year 2020-21 is 5.7%.
employees in the financial year
2020-21.
4. Number of permanent employees There were 1,563 permanent employees of Parag Milk Foods Limited as on
on the rolls of the Company March 31, 2021

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

S.No. Disclosure Requirement Disclosure Details Annexure VI

5. The average percentage increase For the employees other than managerial personnel who were in employment FORM NO. MR-3
already made in the salaries in FY 2020-21, the average increase is 5.61%.
of employees other than the
Average decrease in managerial remuneration is 22.19%.
SECRETARIAL AUDIT REPORT
managerial personnel in the last FOR THE FINANCIAL YEAR ENDED MARCH 31, 2021
financial year and its comparison [Pursuant to section 204(1) of the Companies Act, 2013 and Rule No. 9 of the Companies (Appointment and Remuneration of
with the percentage increase in Managerial Personnel) Rules, 2014]
the managerial remuneration and
justification thereof and point To,
out if there are any exceptional The Members,
circumstances for increase in the Parag Milk Foods Limited
managerial remuneration.
We have conducted the Secretarial Audit of the compliance of applicable statutory provisions and the adherence to good corporate
practices by Parag Milk Foods Limited (hereinafter called “the Company”). Secretarial Audit was conducted in a manner that
6. Affirmation that the remuneration is Yes, it is confirmed.
provided us a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing our opinion thereon.
as per the Remuneration Policy of
the Company Based on our verification of the Company’s books, papers, minute books, forms and returns filed and other records maintained
by the company and also the information provided by the Company, its officers, agents and authorized representatives during the
conduct of Secretarial Audit, We hereby report that in our opinion, the company has, during the audit period covering the financial
year ended on March 31, 2021 complied with the statutory provisions listed hereunder and also that the Company has proper
Board-processes and compliance-mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:

We have examined the books, papers, minute books, forms and returns filed and other records maintained by the Company for
the financial year ended on March 31, 2021 according to the provisions of:

i. The Companies Act, 2013 (the Act) and the Rules made thereunder;

ii. The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the Rules made thereunder;

iii. The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder;

iv. Foreign Exchange Management Act, 1999 (“FEMA”) and the Rules and Regulations made thereunder to the extent of Foreign
Direct Investment, Overseas Direct Investment and External Commercial Borrowings;

The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (‘SEBI Act’):-

a. The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;

b. The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015;

c. Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014;

d. The Securities and Exchange Board of India (Listing Obligation and Disclosure Requirement) Regulations, 2015;

e. The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018;- Not Applicable
for this financial year

f. The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008; Not Applicable for this
financial year

g. The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding
the Companies Act and dealing with client; Not Applicable for this financial year

h. The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009; Not Applicable for this financial
year

i. The Securities and Exchange Board of India (Buy-back of Securities) Regulations, 2018; Not Applicable for this financial year

90 91
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Amongst the various laws which are applicable to the Company, following are the laws which are specifically applicable to the 23. Tax Laws (Central & State Tax Laws):
Company:
• Income Tax Act, 1961
1. The Prevention of Food Safety and Standard Act, 2006
• State Goods and Services Tax Act
• Food Safety and Standards Rules, 2011
• Central Goods and Service Tax Act
• Food Safety and Standards (Licensing and Registration of Food businesses) Regulation, 2011
• Interstate Goods and Service Tax Act
• Food Safety and standards (Packaging and Labelling) Regulation, 2011
24. Employee Laws:
• Food Safety and standards (Food product standards and Food Additives) Regulation, 2011
• Payment of Gratuity Act, 1972 and Payment of Gratuity (Central) Rules, 1972;
• Food Safety and standards (Prohibition and Restriction on sales) Regulation, 2011
• The Payment of Bonus Act, 1965 and Payment of Bonus Rules, 1975;
• Food Safety and standards (contaminants, toxins and residues) Regulation, 2011
• The Payment of Wages Act, 1936;
• Food Safety and Standards (Laboratory and sampling analysis) Regulation, 2011
• Factories Act, 1948 and Maharashtra Factories Rules, 1963
2. The Petroleum Act, 1934 & Rule 2002
• The Minimum Wages Act 1948;
3. Legal Metrology Laws including Legal Metrology Act, 2009, Legal Metrology (Packaged Commodities) Rules, 2011
• The Employees’ Provident Fund and Miscellaneous Provisions Act, 1952, and Scheme framed thereunder;
4. The States Shops and Establishment Act including Maharashtra Shops and Establishments Act, 1948
• The Employees’ State Insurance Act 1948;
5. Inflammable Substances Act, 1952
• The Maternity Benefit Act, 1961;
6. Environment (Protection) Act, 1986 & Rules and notifications issued under the Act
• The Contract Labour (Regulation and Abolition) Act, 1970 & Rules;
7. Water (Prevention & Control of Pollution) Act, 1974 and Air (Prevention & Control of Pollution) Act, 1981
• Equal Remuneration Act, 1976;
8. Water (Prevention and Control of Pollution) Cess Rules, 1977 & 2003
• Workmen’s Compensation Act, 1923;
9. Hazardous and other Wastes (Management & Transboundary Movement) Rules, 2016
• Employment Standing Orders Act, 1946;
10. The Noise Pollution (Regulation and Control) Rules, 2000
• Child Labour (Prohibition and Regulation) Act, 1986;
11. The Public Liability Insurance Act, 1991
• The Employment Exchanges (Compulsory Notification of Vacancies) Act, 1959;
12. The Energy Conservation Act, 2010
• Labour Welfare Fund Act, 1953
13. Biological Diversity Act, 2002
25. Indian Stamp Act, 1899 and the State Stamp Acts;
14. The Indian Boiler Act, 1923
26. Indian Contract Act, 1872
15. The Gas Cylinder Rule, 1981
27. Negotiable Instruments Act, 1881
16. Central Motor Vehicle Rules, 1989
28. Information Technology Act, 2000
17. The Batteries (Management and Handling) Rules, 2001
29. Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
18. The Indian Electricity Rules, 1956
We have also examined compliance with the applicable clauses of the following:
19. The Public Liability Act, 1991 and The Public Liability Insurance (Amendment) Rules, 2007
i. Secretarial Standards issued by The Institute of Company Secretaries of India (ICSI)
20. The Manufacture, Use, Import, Export, and Storage of hazardous Microorganisms/ Genetically Engineered Organisms or
Cells Rules, 1989 During the period under review, the Company has complied with the provisions of the various Act, Rules, Regulations, Guidelines,
Standards, etc. mentioned above.
21. Competition Act, 2002
We further report that the Board of Directors of the Company is duly constituted with proper balance of Executive Directors, Non-
22. Consumer Protection Act, 2019 Executive Directors and Independent Directors. The changes in the composition of the Board of Directors that took place during
the period under review were carried out in compliance with the provisions of the Act.

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Adequate notice is given to all directors to schedule the Board and Committee Meetings. Agenda and detailed notes on agenda To,
were sent adequately in advance of the meetings, and a system exists for seeking and obtaining further information and The Members,
clarifications on the agenda items before the meeting and for meaningful participation at the meeting. Parag Milk Foods Limited

Majority decision is carried through while the dissenting members’ views are captured and recorded as part of the minutes where Our report of even date is to be read along with this letter.
applicable. All the decisions have been taken unanimously and no dissent recorded in Board Meetings.
1. Maintenance of Secretarial record is the responsibility of the Management of the Company. Our responsibility is to express
We further report that, during the audit period, the Members at the Annual General Meeting held on September 29, 2020 approved an opinion on these Secretarial Records based on our audit.
the following by passing special resolutions:
2. We have followed the audit practices and processes as were appropriate to obtain reasonable assurance about the correctness
1. Re-appointment of Mr. Ramesh Chandak as an Independent Director for a second term of 5 (five) consecutive years on the of the contents of the Secretarial records. The verification was done on test basis to ensure that correct facts are reflected in
board of the company with effect from June 24, 2021 upto June 23, 2026. the Secretarial records. We believe that the processes and practices, we followed provide a reasonable basis for our opinion.

2. Payment of remuneration to Mr. B.M. Vyas (DIN: 00043804), Non-Executive Director, exceeding fifty percent of the total 3. We have not verified the correctness and appropriateness of financial records and Books of Accounts of the Company.
remuneration payable to all Non-Executive Directors.
4. Where ever required, we have obtained the Management representation about the compliance of Laws, Rules and Regulations
We further report that, during the audit period, the Company at the Annual General Meeting held on September 29, 2020, and happening of events etc.
declared Final Dividend on equity shares at the rate of ` 0.50/- per equity share for the financial year ended March 31, 2020.
5. The compliance of the provisions of Corporate and other applicable Laws, Rules, Regulations, standards is the responsibility
of the Management. Our examination was limited to the verification of procedures on test basis.
For M/s N. L. Bhatia & Associates
Practicing Company Secretaries 6. The Secretarial Audit report is neither an assurance as to the future viability of the Company nor the efficacy or effectiveness
UIN: P1996MH055800 with which the Management has conducted the affairs of the Company.

For M/s N. L. Bhatia & Associates

Bharat R. Upadhyay
Practicing Company Secretaries
Partner
UIN: P1996MH055800
FCS: 5436
CP. No.: 4457
Bharat R. Upadhyay
Date: June 11, 2021 UDIN: F005436C000448010
Partner
Place: Mumbai P/R No.: 700/2020
FCS: 5436
CP. No.: 4457
Date: June 11, 2021 UDIN: F005436C000448010
Place: Mumbai P/R No.: 700/2020

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 Parag Milk Foods Limited Wholesome living Corporate Overviews Statutory Reports Financial Statements

Corporate Governance Report Name of the Directors Category of Directorship No. of Board Meetings
Attended
Attendance at the 28th
Annual General Meeting
Mr. Devendra P. Shah Promoter-Executive Chairman 4 Yes
DIN: 01127319 (Whole time Director)
Pursuant to Regulation 34 read with Schedule V to the (a) As on March 31, 2021, the strength of the Board was Mr. Pritam P. Shah Promoter - Managing Director 4 Yes
Securities and Exchange Board of India (Listing Obligations seven Directors. The Board of Parag Milk Foods Limited DIN: 01127247
and Disclosure Requirements) Regulations, 2015) (“SEBI Listing comprises of an optimum composition of Executive
Mr. B.M. Vyas Non-Executive 3 Yes
Regulations”) the Report on the Corporate Governance is given and Non-Executive Directors. The Managing Director
DIN: 00043804 Non-Independent Director
below. The Company confirms compliance with the Corporate and the Chairman being Whole-time director are the
Governance provisions as prescribed under Chapter IV of the two Executive Directors. There are five Non-Executive Mr. Ramesh Chandak Independent Director 4 Yes
Listing Regulations, which prescribes the obligations upon the Directors comprising of one non-executive non– DIN: 00026581
listed entities that have listed their specified securities on any independent director and four non-executive independent Mr. Narendra Ambwani Independent Director 4 Yes
of the recognized Stock Exchanges. directors including one woman independent director. DIN: 00236658
The composition of Board of Directors meets with the Mr. Nitin Dhavalikar Independent Director 4 Yes
1. COMPANY’S PHILOSOPHY ON CORPORATE requirement under the provisions of Companies Act, 2013 DIN: 07239870
GOVERNANCE (“The Act”) and SEBI (Listing Obligations & Disclosure
Ms. Radhika Dudhat Independent Director 4 Yes
Requirements) Regulations, 2015, as amended.
Parag Milk Foods Limited (“the Company”) recognises DIN: 00016712
strong corporate governance as a pre-requisite for (b) In view of the ongoing Covid - 19 pandemic, all the
meeting the needs and aspirations of its stakeholders (c) Number of other Board of Directors or Committees (other than the Company) in which the Director is a Chairman / Member
meetings during the year ended March 31, 2021 were held
which it establishes by the application of best (excluding private limited companies, foreign companies and companies registered under Section 8 of the Companies Act,
through Video Conferencing/ Other Audio Visual Means
management practices, compliance of laws in true letter 2013) and their category of directorship as on March 31, 2021, is as follows:
without the physical presence of the directors/members
and spirit and adherence to ethical standards for effective in accordance with the circulars issued by the Ministry of
management and distribution of wealth and discharge of Name of the Directors No. of Directorships No. of Audit Committees and Stakeholders’ Relationship
Corporate Affairs and the Securities and Exchange Board
social responsibility for sustainable development of all Committees* in which Chairman/ Member
of India. During the financial year 2020-21, the Board of
stakeholders. Transparency, integrity, professionalism Directors met four times i.e., on June 29, 2020, September Chairman Member
and accountability - these values form the basis of the 7, 2020, November 9, 2020 and February 5, 2021. The Mr. Devendra Shah 0 - 0
Company’s philosophy for Corporate Governance. The maximum gap between any two consecutive meetings Mr. Pritam Shah 0 - 0
Company believes that good Corporate Governance was less than one hundred and twenty days, as stipulated
is a continuous process and strives to improve the Mr. B. M. Vyas 0 0 0
under Section 173(1) of the Act, and Regulation 17(2) of
Corporate Governance practices to meet shareholders’ the Listing Regulations and the Secretarial Standards Mr. Ramesh Chandak 5 3 6
expectations. issued by Institute of Company Secretaries of India (ICSI). Mr. Narendra Ambwani 3 1 6
In terms of Regulation 17 of the Listing Regulations the Mr. Nitin Dhavalikar 0 0 0
2. BOARD OF DIRECTORS (“BOARD”)
non - executive independent directors constitute 50%
Ms. Radhika Dudhat 2 2 4
An enlightened Board consciously creates a culture of the Board as on March 31, 2021. The members of the
Board are from diverse backgrounds having expertise * As per Regulation 26(1)(b) of SEBI Listing Regulations.
of leadership to provide a long-term vision and policy
approach to improve the quality of governance. The in the fields like Industry, Management, Technicalities,
Details of their directorships in listed entities other than the Company and their category of directorship as on March 31,
Board’s actions and decisions are aligned with the Finance, Legal, Marketing etc.
2021, are as follows:
Company’s best interests. The Board is committed to
The 28th AGM of the Company was held on September Name of the Directors Names of Listed Entities Category of Directorship
the goal of sustainably elevating the Company’s value
29, 2020 by Video Conferencing / Other Audio Visual Mr. Devendra Shah - -
creation. The Company has defined guidelines and an
Means through e-voting system of the National Securities Mr. Pritam Shah - -
established framework for the meetings of the Board and
Depository Limited (NSDL) Mr. B. M. Vyas - -
its Committees. These guidelines seek to systematise the
decision-making process at the meetings of the Board Mr. Ramesh Chandak i) Ram Ratna Wires Limited (Non-Executive Independent Director)
Details of the Directors of the Company and their
and its Committees in an informed and efficient manner. ii) KEC International Limited (Non-Executive Independent Director)
attendance at the Board Meetings held during the
Further, the Board of Directors of the Company is fully financial year 2020-21 and the Annual General Meeting of iii) Summit Securities Limited (Non-executive Independent Director)
committed to the best practices for effective Corporate the Company is as follows: iv) Prince Pipes and Fittings Limited (Non-Executive Independent Director)
Governance.
Mr. Narendra Ambwani i) Agro Tech Foods Limited (Non-Executive Independent Director)
ii) RPG Life Sciences Limited (Non-Executive Independent Director)
iii) Godrej Consumer Products Limited (Non-Executive Independent Director)
Mr. Nitin Dhavalikar - -
Ms. Radhika Dudhat i) Jain Irrigation Systems Limited (Non-Executive Independent Director)
ii) Tips Industries Limited (Non-Executive Independent Director)

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 Parag Milk Foods Limited Wholesome living Corporate Overviews Statutory Reports Financial Statements

The number of directorships and the positions held by (h) A Chart / Matrix setting out the skills / expertise / v. Legal acumen and exposure to changing regulatory vii. Governance- Experience in developing governance
them on Board and Committees are in conformity with competence of the Board of Directors landscape - Ability to understand the compliance framework, serving the best interests of all stakeholders,
the limits on the number of directorships and Committee requirements under various laws, and also to driving board and management effectively, building
positions as laid down in the Companies Act, 2013 and (i) The Directors on the Board are eminent personalities guide and ensure that the board’s responsibility long-term effective stakeholder engagements and
SEBI Listing Regulations, as on March 31, 2021. and leaders and have expertise in their respective in overseeing compliance with statutory rules and sustaining corporate ethics and values.
functional areas. These directors bring in the required regulations is properly discharged.
(d) Number of meetings of the Board held and dates on skills, competence and expertise to the Board. These viii.
Risk Management - Experience in identifying and
which they were held during the year are given in Clause Directors are nominated based on well-defined vi. Business & Financial acumen - Ability to understand evaluating the significant risk exposures to the
2(b) above selection criteria. Nomination and Remuneration and analyze key financial statements, critically assess business strategy of the Company and assess the
Committee (‘NRC’) considers key skills, qualifications, financial viability and performance, oversee efficient Management’s action plan to mitigate the strategic,
(e) In terms of Regulation 36(3)(c) and Schedule V(C)(2)(e) use of resource. legal, compliance and operational risks.
expertise and competencies, whilst recommending
of the SEBI Listing Regulations, none of the Directors are
related to each other. However, Mr. Devendra P. Shah and to the Board the candidature for appointment of a In terms of the requirement of the Listing Regulations, the Board has identified the core skills/ expertise/ competencies of
Mr. Pritam P. Shah are brothers. Director. The Board of Directors have, based on the the Directors in the context of the Company’s business for effective functioning of the Board. These are as follows:
recommendations of the NRC, identified various core
(f) Disclosure of Shareholding of Non-Executive Directors: key skills/expertise/competencies of Directors as Sr. Skills /Expertise/Competencies DS PS BM RC NA RD ND
None of the Independent Non-Executive Directors hold required in the context of business of the Company for No.
any equity shares or convertible instruments of the its effective functioning which are currently possessed 1. Industry Knowledge Yes Yes Yes Yes Yes Yes Yes
Company during the financial year ended March 31, 2021, by the Board Members of the Company and mapped 2. Marketing & Communications and consumer expectations Yes Yes Yes Yes Yes Yes Yes
except Mr. Narendra Ambwani who holds 4500 equity against each of the Directors.
shares of the Company. 3. Behavioural Skills Yes Yes Yes Yes Yes Yes Yes
The brief profiles of Directors forming part of this 4. Strategy and Planning Yes Yes Yes Yes Yes Yes Yes
(g) Familiarization Programmes Annual Report give an insight into the education, 5. Legal acumen and exposure to changing regulatory landscape Yes Yes Yes Yes Yes Yes Yes
The Company has an orientation programme upon expertise, skills and experience of the Directors, thus
6. Business and Financial acumen Yes Yes Yes Yes Yes Yes Yes
induction of new Directors, as well as other initiatives to bringing in diversity to the Board’s perspectives.
7. Governance Yes Yes Yes Yes Yes Yes Yes
update directors on a continuous basis.
The core skills/ expertise/ competencies identified 8. Risk Management Yes Yes Yes Yes Yes Yes Yes
Presentations are made by Senior Management Personnel/ by the Board of Directors as required in the context
Business Heads of the Company to the Independent of its business (es) and sector(s) for it to function Note: DS - Devendra Shah, PS - Pritam Shah, BM - B.M.Vyas, RC - Ramesh Chandak, NA - Narendra Ambwani, RD - Radhika
Directors covering nature of industry, business model, effectively, are as follows: Dudhat, ND - Nitin Dhavalikar
business performance and operations, challenges & (i) Directors’ Independence and Declarations conditions specified under the Act and SEBI Listing
i. Industry Knowledge – understand the Company’s
opportunities available, etc. Certain programmes are Regulations and are independent of the management of
merged with the Board/ Committee meetings for the business, policies, and culture (including its All Independent Directors of the Company have certified the Company.
convenience of the Directors. Separate programs are also mission, vision, values, goals, current strategic and confirmed their independence in accordance
conducted for them as per their requirement. plan, governance structure, major risks and threats with Section 149(6) of the Companies Act, 2013 read Pursuant to Section 164(2) of the Act, all the Directors
and potential opportunity (ies) and knowledge of with Regulations 16(1)(b) and 25(8) of the SEBI Listing have also provided annual declarations that they have
Thereafter, the Independent Directors are provided the industry in which the Company operates. A Regulations as on March 31, 2021. Further in terms of not been disqualified to act as Directors. M/s. N.L.
with necessary presentations, documents, reports, broad range of commercial / business experience, the Regulation 25(8), they have confirmed that they are Bhatia & Associates, Practicing Company Secretaries
internal policies and updates to familiarise them with the preferably in areas relating or relevant to the not aware of any circumstances or situation which exists has issued a certificate as required under the Listing
Company’s business, policies, procedures and practices Company’s business. or may be reasonably anticipated that could impair or Regulations, confirming that none of the Directors on
at various Meetings held during the year. impact their ability to discharge their duties. the Board of the Company are debarred or disqualified
ii. Marketing & Communications and Consumer from being appointed or continuing as directors of the
The Independent Directors are also exposed to the expectations - Knowledge of and exposure to A Declaration on compliance with Rule 6(3) of the Company by the SEBI / Ministry of Corporate Affairs or
constitution, Board procedures, matters reserved for the Companies (Appointment and Qualification of Directors)
nuances of marketing and public promotion any such statutory authority. The same forms part of this
Board and major risks facing the business and mitigation Rules, 2014, along with a declaration as provided in the
campaigns, and ability to gather information relating Annual Report.
programs. The Independent Directors are also made Notification dated October 22, 2019, issued by the Ministry
to consumer expectations and grievances.
aware of their roles and responsibilities at the time of their of Corporate Affairs (“MCA”), regarding the requirement (j) Separate Meeting of Independent Directors
appointment and a detailed Letter of Appointment is issued iii. Behavioural Skills – attributes and competencies to relating to enrolment in the Data Bank for Independent
to them. The Board has adopted a Policy on Familiarization use their knowledge and skills to function well as Directors, has been received from all the Independent Schedule IV of the Companies Act, 2013 and Regulation
Programme for the Independent Directors which aims to Directors, along with declaration made under Section 25(3) of the SEBI Listing Regulations, mandates the
team members and to interact with key stakeholders.
provide them with significant insight into the business of 149(6) of the Act. Independent Directors of the Company to hold at least one
the Company. The details of familiarization programme iv. Strategy and Planning – Ability to understand, review meeting in a financial year without the attendance of Non-
imparted to Independent Directors during the financial and guide strategy by analyzing the company’s All such declarations/confirmations of Independent Independent Directors and members of the management.
year 2020-21, if any are available at the Company’s website competitive position and benchmarking taking into Directors are placed before the Board. Based on At such meetings, the independent directors discuss,
and can be accessed at www.paragmilkfoods.com. account market and industry trends. such confirmations, in the opinion of the Board, all among other matters, the performance of the Company
Independent Directors of the Company fulfil the and risks faced by it, the flow of information to the

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 Parag Milk Foods Limited Wholesome living Corporate Overviews Statutory Reports Financial Statements

Board, competition, strategy, leadership, strengths and of the Board which were mandatorily required have been 21 read with Part C of Schedule II of SEBI (Listing Obligations was present at the 28th Annual General Meeting of the
weaknesses, governance, compliance, human resource accepted by the Board. and Disclosure Requirements) Regulations, 2015. Company held on September 29, 2020 to answer the
matters and performance of the executive members of Shareholder queries.
the Board, including the Chairman. The Board has established the following statutory and The Company Secretary of the Company is the Secretary
non-statutory Committees: - to the Committee. The Management is responsible for the Company’s
During the year, the independent directors met without internal control over financial reporting and the
the presence of the Management. Due to the Corona A. Audit Committee All members of the Audit Committee are financially financial reporting process. The Committee, in
virus pandemic still being persistent, the meeting of literate and have relevant expertise in the fields of order to carry out its responsibilities efficiently and
The Audit Committee acts in accordance with the terms Finance, Taxation, Economics, Risk and International
Independent Directors was held on March 20, 2021 transparently, relies on the Management’s financial
of reference specified by the Board which includes the Finance. It functions in accordance with its terms of
through video – conferencing. The meeting was chaired expertise and that of the internal and independent
recommendation for appointment, remuneration and reference that defines its authority, responsibility and
by Mr. Ramesh Chandak, Independent Director wherein auditors. The Management is responsible for the
terms of appointment of auditors of the Company, review reporting function.
the Independent Directors inter alia discussed the Company’s internal control over financial reporting
and monitor the auditor’s independence and performance
following: and the financial reporting process.
and effectiveness of the audit process, examination Meetings and Attendance
i. Reviewed the performance of Non - Independent of the financial statements and the auditor’s report The meetings of Audit Committee are also attended by
thereon, approval or any subsequent modification of The Audit Committee meets at least once a quarter. The
Directors and the Board as a whole; the Chief Financial Officer, representatives of Statutory
transactions of the Company with related parties, scrutiny Audit Committee met four times during the Financial
Auditors, Internal Auditor and executives from accounts
ii. Reviewed the performance of the Chairman of the of inter-corporate loans and investments, valuation of Year 2020-21. The gap between two Meetings was
and finance department as special invitees. The Company
Company, taking into account the views of executive undertakings or assets of the Company wherever it is not more than 120 days. The Committee met on June
Secretary acts as the Secretary to the Committee. The
directors and non-executive directors; necessary, evaluation of internal financial controls and risk 29, 2020, September 7, 2020, November 9, 2020 and
minutes of each Audit Committee meeting are placed in
management systems, monitoring the end use of funds February 4, 2021. The requisite quorum was present in
the next meeting of the Board.
iii. Assessed the quality, quantity and timeliness of flow raised through public offers and related matters. all the Meetings. The Chairman of the Audit Committee
of information between the Company management
and the Board that is necessary for the Board to As at March 31, 2021, Mr. Nitin Dhavalikar, Mr. Narendra The Table below provides the attendance of the Audit Committee members:
effectively and reasonably perform its duties. Ambwani, Mr. Ramesh Chandak all Non-Executive and
Independent Directors, were the members of the Audit Sr. Name of the Members Designation Category No. of Meetings during the year
All the Independent Directors were present at this meeting Committee. All of them possess sound knowledge of No. Held Attended
through video-conferencing. The outcome of the meeting accounts, audit, financial management expertise etc.
was apprised to the Chairman of the Company. 1 Mr. Nitin Dhavalikar Chairman Independent Director 4 4
Mr. Pritam Shah, Managing Director is also a member of
2 Mr. Pritam Shah Member Managing Director 4 4
the Committee.
During the year, no Independent Director resigned before
3 Mr. Ramesh Chandak Member Independent Director 4 4
the expiry of his / her tenure Mr. Nitin Dhavalikar is the Chairman of the Audit
4 Mr. Narendra Ambwani Member Independent Director 4 4
Committee and Ms. Rachana Sanganeria, Company
3. COMMITTEES OF THE BOARD
Secretary acts as the Secretary to the Audit Committee. Terms of Reference 5) Reviewing, with the management, the statement of
The Board Committees play a crucial role in the The Audit Committee of the Company is entrusted with uses / application of funds raised through an issue
The Internal Auditor(s), reporting directly to the Audit
governance structure of the Company and have been the responsibility to supervise the Company’s internal (public issue, rights issue, preferential issue, etc.),
Committee and the representatives of the Statutory
constituted to deal effectively with specific areas / controls and financial reporting process and, inter-alia, the statement of funds utilized for purposes other
Auditors also attend the meetings of the Audit Committee,
activities as mandated by applicable regulations which performs the following functions: than those stated in the offer document / prospectus
besides the executives invited by the Audit Committee to
concern the Company and need a closer review. The / notice and the report submitted by the monitoring
be present there at.
Chairman of the Board, in consultation with the Company 1) Ensuring an effective and independent internal agency monitoring the utilisation of proceeds of
Secretary and the committee chairperson, determines Mr. Nitin Dhavalikar, Chairman of the Audit Committee, audit function, which works to provide assurance a public or rights issue, and making appropriate
the frequency and duration of the committee meetings. was present at the last Annual General Meeting of regarding the adequacy and operation of internal recommendations to the Board to take up steps in
Normally, all the committees meet two to four times a the Company held on September 29, 2020 by Video controls and processes intended to safeguard the this matter;
year. The Chairman of the respective Committee updates Conferencing / Other Audio Visual Means. Company’s assets, effective and efficient use of
the Board about the summary of the discussions held in the Company’s resources and, timely and accurate 6) Review and monitor the auditor’s independence and
the Committee Meetings. The Board of Directors have Composition recording of all transactions. performance, and effectiveness of audit process;
confirmed that during the year, all recommendations of
The Audit Committee comprises of Mr. Nitin Dhavalikar 2) Recommendation for appointment, payment of 7) Scrutiny of inter-corporate loans and investments;
the Committee(s) were duly considered and approved by
the Board of Directors and none of the recommendation as the Chairman, Mr. Narendra Ambwani, Mr. Ramesh remuneration and terms of appointment of auditors
8) Evaluation of internal financial controls and risk
made by any of the Committees have been rejected by Chandak who are the Independent Directors and Mr. Pritam of the company;
management systems;
the Board. The minutes of the meeting of all Committees Shah, Managing Director as Members of the Committee.
3) Review of Company’s financial statements, internal
are placed before the Board for noting / review. The 9) Reviewing, with the management, performance
The composition, powers, role and terms of reference of financial reporting process and the audit process
Board Committees can request special invitees to join the of statutory and internal auditors, adequacy of the
the Committee are in accordance with the requirements
meeting, as appropriate. 4) Reviewing, with the management, the quarterly internal control systems;
mandated under Section 177 of the Companies Act, 2013
read with the rules made thereunder and Regulation 18 and financial statements before submission to the board
During the year, all recommendations of the Committees 10) Reviewing the adequacy of internal audit function,
for approval;
if any, including the structure of the internal audit

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Parag Milk Foods Limited Wholesome living Corporate Overviews Statutory Reports Financial Statements

department, staffing and seniority of the official 3. Management letters / letters of internal control Sr. Name of the Members Designation Category No. of Meetings during the year
heading the department, reporting structure weaknesses issued by the statutory auditors; No. Held Attended
coverage and frequency of internal audit;
4. Internal audit reports relating to internal control 1 Mr. Nitin Dhavalikar Chairman Independent Director 2 2
11) Reviewing the findings of any internal investigations weaknesses; and
2 Mr. Devendra Shah Member Executive Director 2 2
by the internal auditors into matters where there is
5. The appointment, removal and terms of remuneration 3 Ms. Radhika Dudhat Member Independent Director 2 2
suspected fraud or irregularity or a failure of internal
control systems of a material nature and reporting of the chief internal auditor shall be subject to review 4 Mr. B. M. Vyas Member Non-Executive Director 2 2
the matter to the board; by the audit committee.
5 Mr. Ramesh Chandak Member Independent Director 2 2

12) Discussion with statutory auditors before the audit 6. Statement of deviations:
Terms of Reference
commences, about the nature and scope of audit as
(a) Quarterly statement of deviation(s) including report of
well as post-audit discussion to ascertain any area of The terms of reference are reviewed from time to time by performance and defined assessment criteria.
monitoring agency, if applicable, submitted to stock
concern; the Board and the Committee has been mandated inter-
exchange(s) in terms of Regulation 32(1). • Administer, monitor and formulate detailed terms and
alia to comply with the requirements as specified in Part
13) To look into the reasons for substantial defaults in D of the Schedule II of SEBI Listing Regulations including conditions of the Employees’ Stock Option Scheme.
(b) Annual statement of funds utilized for purposes
the payment to the depositors, debenture holders, the amendment made through Listing Regulations, the
other than those stated in the offer document / • Annual performance evaluation of the Committee.
shareholders (in case of non-payment of declared provisions of Section 178 of the Act and Securities and
prospectus / notice in terms of Regulation 32(7).
dividends) and creditors; Exchange Board of India (Share Based Employee Benefits) • Leadership development and succession planning of
The Company follows best practices in financial Regulation, 2014, as may be applicable. The Nomination the organization
14) Approval of appointment of Chief Financial Officer
reporting. The Company has been reporting on and Remuneration Committee is responsible for evaluating
after assessing the qualifications, experience and • To recommend to the board, all remuneration, in
quarterly basis, the Un-audited Consolidated the balance of skills, experience, independence, diversity
background, etc. of the candidate; whatever form, payable to senior management
Financial Statements as required by the Regulation and knowledge of directors on the Board and for drawing
15) Reviewing the utilization of loans and / or advances 33 of the Listing Regulations. The Company’s up selection criteria, ongoing succession planning and
• To carry out any other function as is mandated by
from / investment by the holding company in the quarterly Un-audited Standalone and Consolidated appointment procedures for both internal and external
the Board from time to time and / or enforced by any
subsidiary exceeding rupees 100 crore or 10% of Financial Statements are made available on the appointments.
statutory Notification, amendment or modified as may
the asset size of the subsidiary, whichever is lower website www.paragmilkfoods.com.
The role of the Nomination and Remuneration be applicable.
including existing loans / advances / investments
B. Nomination and Remuneration Committee Committee inter-alia includes the following:
existing as on the date of coming into force of this 4. Performance Evaluation Criteria for Independent Directors
provision. Composition • Assist the Board in discharging its responsibilities
Pursuant to the provisions of the Companies Act, 2013
relating to compensation of the Company’s executive
16) Review the functioning of vigil mechanism/ whistle The Nomination and Remuneration Committee comprises and the Listing Regulations, the Board has carried
directors, Key Managerial Personnel (KMP) and senior
blower mechanism for the Directors and employees of Five Directors. Mr. Nitin Dhavalikar, Independent out the annual evaluation of its own performance, its
management.
to report their genuine concerns or grievances and Director, is the Chairman of the Committee and Mr. Committees and Directors individually. A structured
provide mechanism for adequate safeguards against Devendra Shah, Mr. B.M. Vyas, Mr. Ramesh Chandak and • Formulate criteria for determining Board composition, questionnaire was prepared after circulating the
victimization. Ms. Radhika Dudhat are the Members of the Committee. Board effectiveness, Board succession, and draft forms, covering various aspects of the Board’s
The composition, powers, role and terms of reference of independent functioning of the Board. functioning such as adequacy of the composition of the
17) Review of compliance with provision of SEBI Insider Board and its Committees, execution and performance
the Committee are in accordance with the requirements
Trading Regulations, 2015 • Devising a policy on Board Diversity and Sustainability. of specific duties, obligations and governance. Individual
mandated under Section 178 of the Companies Act,
2013 and Regulation 19 read with Part D of Schedule II directors including the Chairman of the Board were also
18) Carrying out any other function as is mentioned in • Oversee the Company’s nomination process for the
of the SEBI Listing Regulations, 2015. Apart from the evaluated on parameters such as level of engagement
the terms of reference of the Audit Committee. KMP and senior management and identify through a
above, the Committee also carries out such functions / and contribution, independence of judgement. The
comprehensive selection process, individuals qualified
19) Consider and comment on rationale, cost-benefits responsibilities entrusted on it by the Board of Directors performance evaluation of the Independent Directors was
to serve as directors, KMP and senior management
and impact of schemes involving merger, demerger, from time to time. carried out by the entire Board on basis of participation of
consistent with the criteria approved by the Board
amalgamation etc., on the listed entity and its Independent directors in the meeting, raising of concerns
shareholders. Meetings and Attendance to the Board, safeguarding the confidential information,
• Consider extension or continuation of the term of
appointment of the independent directors on the basis rendering of independent decisions, unbiased opinions
The Audit Committee shall mandatorily review the The Nomination and Remuneration Committee met twice
of the report of performance evaluation of Independent and resolution of issues in the meetings, timely inputs on
following information: during the year on June 29, 2020 and September 07,
Directors. the minutes, and initiatives in terms of planning and new
2020. The requisite quorum was present at the Meeting.
ideas. The Directors expressed their satisfaction with the
1. Management discussion and analysis of financial Mr. Nitin Dhavalikar, the chairman of the Committee
• Specifying the manner for effective evaluation of evaluation process.
condition and results of operations; was present at the 28th AGM of the Company held on
performance of Board, its Committees and Individual
September 29, 2020 to answer the Shareholder queries. A consolidated summary of the ratings given by each
2. Statement of significant related party transactions Directors and review its implementation and
compliance. Director was then prepared. The report of performance
(as defined by the Audit Committee), submitted by The table below provides the attendance of the
evaluation was then discussed and noted by the Board.
management; Nomination and Remuneration Committee members:
• Recommend / review remuneration of the Managing
Director(s) and Whole-time Director(s) based on their For Independent Directors, evaluation is carried out

102 103
Parag Milk Foods Limited Wholesome living Corporate Overviews Statutory Reports Financial Statements

based on the criteria viz. the considerations which Personnel. iii) Remuneration paid to Directors
led to the selection of the Director on the Board and
the delivery against the same, contribution made to d) The sitting fees to the Independent Directors is paid The details of remuneration paid to Executive Directors and Non-Executive Directors during the financial year ended March
the Board / Committees, attendance at the Board / as per the provisions of the Act and the rules framed 31, 2021 are given below:
Committee Meetings, impact on the performance of thereunder.
` in million
the Board / Committees, instances of sharing best and
The Policy on remuneration of Directors, Key Managerial Name of the Directors Remuneration Sitting Fees Total
next practices, engaging with top management team of
Personnel and Senior Managerial Personnel of the
the Company, participation in Strategy Board Meetings, Mr.Devendra Shah 24.00 - 24.00
Company is in consonance with the existing industry
etc. A separate meeting of the Independent Directors (Whole Time Director)
practice and is available on the Company’s corporate
was also held during the year for the evaluation of the Mr. Pritam Shah 24.00 - 24.00
website www.paragmilkfoods.com.
performance of non-independent Directors, performance (Managing Director)
of the Board as a whole and that of the Chairman. i) Remuneration to Non-Executive Directors (including Mr.B.M.Vyas 8.40 - 8.40
the Independent Directors) (Non- Executive Director)
The Board Members from different backgrounds bring
about different complementarities that help Board The Independent Directors are paid sitting fees of
` in million
discussions to be rich and value adding. Constructive ` 100,000 for attending each Board and Committee
Inputs/contributions were received to further strengthen Name of the Directors Remuneration Sitting Fees
Meeting. However there is no sitting fees paid to directors
the performance and the effectiveness of the Board and for attending Finance Committee Meetings. The total NON-EXECUTIVE INDEPENDENT DIRECTORS
Committee meetings held by the Company. amount of sitting fees paid to Independent Directors during Mr. Ramesh Chandak - 1.00
the Financial Year 2020-21 was ` 37 Lakh. The Company
5. Remuneration of Directors Mr. Narendra Ambwani - 0.90
also reimburses the out-of-pocket expenses incurred by the
Mr. Nitin Dhavalikar - 1.10
The Company has adopted the Remuneration Policy as Directors for attending the meetings.
Ms. Radhika Dudhat - 0.70
required under the provisions of the Companies Act, 2013
Mr. B.M. Vyas, Non-executive non-independent Director
and Regulation 19 read with Part D of Schedule II of SEBI Total 3.70
is paid only consultancy fees for professional services
Listing Regulations, 2015. The Company’s Remuneration
offered by him. The Company did not have any pecuniary
Policy is aligned with its philosophy for payment of C. Stakeholders Relationship Committee Mr. Pritam Shah, and Mr. Nitin Dhavalikar as Members of
relationship or transactions with the Non-Executive
remuneration to Directors, KMPs and all other employees, the Committee. During the Financial Year 2020-21 SRC
Directors / Independent Directors during the financial Composition and Attendance
based on the commitment of fostering a culture of meeting was held twice i.e. on June 29, 2020 and February
year 2020-21
leadership with trust. The Board on the recommendation 4, 2021. The table below highlights the composition and
Pursuant to provisions of Section 178(5) of the Companies
of Nomination and Remuneration Committee approved ii) Remuneration to Executive Directors attendance of the Members of the Committee.
Act, 2013 read with Regulation 20 of the Listing
Remuneration Policy for Directors, KMP and senior Regulations, Stakeholders Relationship Committee (SRC)
The appointment and remuneration of Executive The Minutes of the Stakeholders Relationship Committee
management employees. The policy describes various has been constituted. The Stakeholders Relationship
Directors including Chairman - Whole time and Meetings are circulated to the Board and noted by the
aspects and guiding factors while determining the Committee comprises of Mr. B.M. Vyas (Non-Executive
Managing Director is governed by the Nomination and Board of Directors at the Board Meetings.
remuneration to Directors, KMP and senior managerial Director) as the Chairperson and Mr. Devendra Shah,
personnel of the Company with intent to maintain Remuneration Committee, Resolutions passed by the Board
level and composition of remuneration reasonable and of Directors and Shareholders of the Company. Payment Sr. Name of the Members Designation Category No. of Meetings during the year
sufficient to retain, motivate and promote talent and to of remuneration to Executive Directors is governed by the No. Held* Attended
ensure long term sustainability of talented managerial respective Agreements executed between them and the
Company. The remuneration package of Chairman - Whole 1 Mr. B. M. Vyas Chairman Non-Executive 2 2
persons and also create competitive advantage. Broad
time Director and Managing Director comprises of salary, Non-Independent
provisions of the Remuneration Policy are summarized
perquisites and allowances, and contributions to Provident Director
hereunder:
and other Retirement Benefit Funds as approved by the 2 Mr. Devendra Shah Member Executive Director 2 2
a) Nomination and Remuneration committee (NRC) has shareholders at the General Meetings. 3 Mr. Pritam Shah Member Independent Director 2 2
important role in monitoring the policy.
Also out of pocket expenses as incurred by the Directors 4 Mr. Nitin Dhavalikar Member Independent Director 2 2
b) The Board, on the recommendation of NRC approves (both executive and non-executive) for attending the • Due to COVID-19 as per SEBI relaxations the SRC for FY 19-20 was held on June 29, 2020
the remuneration payable to the Managing Director meetings and for business of the Company are reimbursed
of the Company. The remuneration payable to the to them. Annual increments are linked to performance
Managing Director shall be in accordance with the and are decided by the Nomination and Remuneration
applicable provisions of the Act and the rules framed Committee and recommended to the Board for approval
thereunder. thereof.

c) The Board, on the recommendation of the NRC Presently, the Company has not granted any stock options
approves the remuneration payable to the Key to its Directors.
Managerial Personnel and Senior Management

104 105
 Parag Milk Foods Limited Wholesome living Corporate Overviews Statutory Reports Financial Statements

6. Name and Designation of the Compliance Officer new/duplicate certificates, general meetings etc. Name of the Position Category Meetings and Attendance:
Member
Ms. Rachana Sanganeria, Company Secretary acts • Review of measures taken for effective exercise of The CSR Committee Meeting was held on March 31,
as Compliance Officer of the Company in terms of voting rights by shareholders. Mr. B.M.Vyas Chairman Non-Executive, 2021 via video conferencing and other audio visual
Regulation 6 of the Listing Regulations. Non-Independent means whereby the status of CSR Activities undertaken
• Review of adherence to the service standards Director during the FY 2020-21 was noted, the Amendments
The Secretarial Department of the Company, Investor adopted by the listed entity in respect of various vide Companies (Corporate Social Responsibility Policy)
Mr. Devendra Shah Member Executive Director
Relations team and the Registrar and Share Transfer services being rendered by the Registrar & Share Amendment Rules, 2021 were updated as well as revised
Agent viz KFIN Technologies Private Limited attend to Transfer Agent. Mr. Narendra Member Independent
Ambwani Director CSR Policy in line with the amendments was approved.
all grievances of the shareholders received directly or
through SEBI, Stock Exchanges, Ministry of Corporate • Review of the various measures and initiatives taken Ms. Radhika Member Independent The details of corporate social responsibility activities
Affairs, Registrar of Companies, etc. by the listed entity for reducing the quantum of Dudhat Director of the Company during the year are mentioned in the
unclaimed dividends and ensuring timely receipt of annexure to the Directors’ Report.
During the financial year ended March 31, 2021, 29 dividend warrants/annual reports/statutory notices Terms of Reference
complaints were received from shareholders and by the shareholders of the company. E. FINANCE COMMITTEE
• Formulate, monitor and recommend to the Board,
investors. All the complaints have been resolved to the Apart from the above statutory Committees, the Board
• Review movements in shareholding and ownership the CSR Policy and to make it more comprehensive
satisfaction of the shareholders and no investor complaint of Directors has constituted the Finance Committee
structures of the Company so as to indicate the activities to be undertaken by
was pending as on March 31, 2021. The Company has to raise the level of governance as also to meet the
the Company as specified in Schedule VII of the
acted upon all valid requests for share transfer received specific business needs. The Finance Committee of
• To consider and approve Dematerialization/ Companies Act, 2013
during FY 2020-21 and no such transfer is pending. the Board of Directors has been set up w.e.f. August
Rematerialization of shares/split/ consolidation/sub-
division of share/debenture certificates; • To provide guidance on various CSR activities to 10, 2016 to oversee routine operations that arise in the
No investor grievances remained unattended /pending
be undertaken by the Company and to monitor normal course of the business, such as decision on
for more than thirty days as on March 31, 2021.
• Review the various measures and initiatives taken process. banking relations, delegation of operational powers,
The number of complaints received and resolved to the by the Company for reducing the quantum of appointment of nominees under statutes, etc. and
unclaimed dividends and ensuring timely receipt of • Implementing and monitoring the CSR Policy from for taking decisions on behalf of the Board, during
satisfaction of investors during the year under review and
dividend warrants/annual reports/statutory notices time to time the intervening period between two Board Meetings,
their break-up are as under:
by the shareholders of the Company; on the routine matters and also the matters on which
• Recommend to the Board, the amount of expenditure
Type of Complaints Number of Complaints decisions are required to be taken urgently. The broad
• Review movements in shareholding and ownership to be incurred on the activities undertaken
received and resolved terms of reference of the Committee are to approve
structures of the Company;
• Review the performance of the Company in the area investments / divestments of funds of the Company
Non-Receipt of Dividend 29
• Recommend measures for overall improvement of of CSR including the evaluation of the impact of the within the limits prescribed by the Board from time
Total 29 to time. The committee reports to the Board and the
the quality of investor services and Company’s CSR activities
minutes of these meetings are placed before the Board
The table includes Complaints received from SEBI
• Carrying out any other function as prescribed under • Reporting progress of various initiatives and making for confirmation.
Complaints Redress System (SCORES) by the Company.
Securities and Exchange Board of India (Listing appropriate disclosures on a periodic basis During the year, the Committee met 13 (Thirteen) times i.e.
Continuous efforts are made to ensure that grievances Obligations & Disclosure Requirements) Regulations, on April 7, 2020, April 21, 2020, June 11, 2020, July 24, 2020,
• Consider other functions, as defined by the Board,
are more expeditiously redressed to the complete 2015, the Companies Act, 2013 and other applicable August 11, 2020, September 8, 2020, September 23, 2020,
or as may be stipulated under any law, rule or
satisfaction of the investors. Shareholders are requested law as amended from time to time October 12, 2020, November 12, 2020, November 24, 2020,
regulation including the listing regulations and the
to furnish their updated telephone numbers and e-mail December 21, 2020, January 11, 2021 and March 13, 2021.
The Committee also oversees the performance of the Companies Act, 2013
addresses to facilitate prompt action.
Registrar and Share Transfer Agent and recommends
The details of composition of the Finance Committee and attendance of the Members at the Finance Committee Meetings
Terms of Reference: measures for overall improvement of the quality of
are as under:
investor services as and when need arises.
The terms of reference are reviewed from time to time
by the Board and the Committee has been mandated The Meetings of the Committee are generally held as Sr. Name of Members Designation Category No. of Meetings No. of Meeting(s)
inter-alia to comply with the requirements as specified and when deemed necessary, to review and ensure that No. Held Attended
in Regulation 20 read with Part D of the Schedule II of all investor requests / grievances are redressed within 1 Mr. Nitin Dhavalikar Chairman Independent Director 13 13
SEBI Listing Regulations, 2015, as amended and the stipulated time period.
2 Mr. Pritam Shah Member Executive Director 13 13
provisions of Section 178 of the Companies Act, 2013.
D. Corporate Social Responsibility Committee 3 Mr. Devendra Shah Member Executive Director 13 13
The role of the Stakeholders’ Relationship Committee
Composition 7. SUBSIDIARY COMPANY Listing Regulations, 2015. However, it has formulated a
inter-alia includes the following:
policy for determining its ‘Material’ Subsidiaries and the
In terms of Section 135 of the Act, the Board has The Board of Directors of the Company has approved
• Resolving the grievances of the security holders same is available on the website of the Company viz.
constituted the Corporate Social Responsibility (“CSR”) a Policy for determining Material Subsidiaries which is
of the listed entity including complaints related to www.paragmilkfoods.com.
Committee. The Committee composition as on March 31, in line with the Listing Regulations as amended. As on
transfer/transmission of shares, non-receipt of annual
2021 is as under: March 31, 2021, the Company does not have any Material The Company monitors performance of subsidiary
report, non-receipt of declared dividends, issue of
Subsidiary as defined under Regulation 16(1)(c) of SEBI companies, inter alia, by the following means:

106 107
 Parag Milk Foods Limited Wholesome living Corporate Overviews Statutory Reports Financial Statements

• Financial statements, in particular investments made • Presentations are made to the Company’s Board on b) Postal Ballot 9. MEANS OF COMMUNICATION
by subsidiary companies, are reviewed quarterly by business performance by the senior management Effective communication of information is an essential
the Company’s Audit Committee. on subsidiary of the Company. No Special Resolution was passed last year through Postal
component of Corporate Governance. It is a process
Ballot
of sharing information, ideas, thoughts, opinions
• Minutes of Board meetings of subsidiary companies Information to Stock Exchanges is filed electronically
During the year, no postal ballot was conducted by the and plans to all stakeholders, which promotes
are placed before the Company’s Board regularly. on the online portals of BSE Limited i.e. BSE Corporate
Company. transparency, accountability and confidence in the
Compliance & Listing Centre (Listing Centre) and National
• A statement containing all significant transactions stakeholders and strengthens robust shareholder
Stock Exchange of India Limited i.e. NSE Electronic
and arrangements entered into by subsidiary As on March 31, 2021,. no Special Resolution was proposed relations. The Company regularly interacts with
Application Processing System (NEAPS).
companies is placed before the Company’s Board. to be conducted through Postal Ballot. Members through multiple channels of communication
such as results announcement, annual report, media
8. SHAREHOLDER INFORMATION Postal Ballot whenever conducted will be carried out as
releases, Company’s website and subject specific
per the procedure mentioned in Rule 22 of Companies
GENERAL BODY MEETINGS communications.
(Management and Administration) Rules, 2014,
including any amendment thereof.
(a) Details of General Meetings:

Location and time of the last three Annual General Meetings held and the special resolutions passed in them, a. Quarterly Results The quarterly results are published in accordance with the applicable provisions of
the SEBI Listing Regulations
Location, time and details of the Annual General Meetings (AGM) held during the last 3 years and Special Resolutions passed
b Newspapers wherein results The financial results are published in leading English and Marathi daily newspapers,
thereat are given below:
normally published viz. “The Financial Express” (English Newspaper) and “Lok Satta Pune” (Marathi
Newspaper)
Particulars of AGM Date and Time Venue Details of Special Resolution(s) Passed
c Any Website, where displayed The Company’s corporate website address is www.paragmilkfoods.com which
28 AGM 2019-20
th
September 29, Video Conferencing / Other 1. Re-appointment of Mr. Ramesh
contains a dedicated section “Investors Tab”
2020 at 04:30 P.M. Audio Visual Means due Chandak (DIN: 00026581) as an
to COVID-19 Pandemic in Independent Director. d Whether it also displays official Yes
accordance with circulars news releases
issued by the Ministry of 2. Approval for payment of remuneration
e The presentations made to Any presentation made to the institutional investors or/and analysts are submitted
Corporate Affairs and the to Mr. B.M. Vyas (DIN: 00043804),
institutional investors or to to the stock Exchanges and also posted on the Company’s website
Securities Exchange Board of Non-Executive Director, exceeding
analysts
India. fifty percent of the total remuneration
payable to all Non-Executive Directors. 11. GENERAL SHAREHOLDER INFORMATION
27 AGM 2018-19
th
September 30, A-Wing, 5 th
Floor, MCCIA 1. To re-appoint Mr. Narendra Ambwani
(a) Date, Time and Venue of the AGM: The ensuing AGM of the Company will be held on Wednesday, September 15, 2021 at
2019 at 03:30 P.M. Trade Tower, ICC Complex, (DIN: 00236658) as an Independent
4:00 P.M. through video conferencing or other audio visual means.
403, Senavati Bapat Director.
Road, Mahratta Chamber (b) Financial Calendar: April 1, 2020 to March 31, 2021
of Commerce Industries 2. To re-appoint Ms. Radhika Dudhat (DIN:
& Agriculture (MCCIA), 00016712) as an Independent Director. (c) Record Date: Wednesday, September 8, 2021 / Dates of Book Closure: Register of Members and Share Transfer Books of the
Pune - 411 016 - Maharashtra. Company will remain closed from Thursday, September 09, 2021 to Wednesday, September 15, 2021, (both days inclusive)
3. To re-appoint Mr. Nitin Dhavalikar (DIN:
for the purpose of Annual General Meeting and Dividend.
07239870) as an Independent Director.
Dividend Payment Date: Within 30 days from the date of approval by the Shareholders for the dividend, if any.
4. To approve Parag Milk Foods Limited
(PMFL) “Employee Stock Option Dividend, when declared, will be payable on or after September 15, 2021 to those members whose names are registered as
Scheme 2019” (ESOP 2019 / Parag such in the Register of Members of the Company as on September 8, 2021 and to the Beneficiary holders as per the beneficia-
ESOS 2019) ry list as on September 8, 2021 provided by National Securities Depository Limited (“NSDL”) and Central Depository Services
26th AGM 2017-18 September 19, A-Wing, 5th Floor, MCCIA 1. To re-appoint Mr. Pritam Shah (DIN: (India) Limited (“CDSL”).
2018 at 11:30 A.M. Trade Tower, ICC Complex, 01127247) as the Managing Director
403, Senapati Bapat and Key Managerial Personnel (KMP) of (d) Listing of Stock Exchanges:
Road, Mahratta Chamber the Company.
The Company’s Equity Shares are listed on the BSE Limited and the National Stock Exchange of India Limited
of Commerce Industries
& Agriculture (MCCIA), 2. To re-appoint Mr. Devendra Shah (DIN:
01127319) as Whole- Time Director and BSE Limited (“BSE”) National Stock Exchange of India Limited (“NSE”)
Pune - 411 016 - Maharashtra.
Key Managerial Personnel Phiroze Jeejeebhoy Towers, Dalal Street, Exchange Plaza, Bandra-Kurla Complex Bandra (E),
Mumbai - 400 001 Mumbai - 400 051
3. To ratify Parag Milk Foods Limited
“Employee Stock Option Scheme The annual listing fees of the BSE and the NSE for the financial year 2021-22 has been paid.
2015” (ESOS 2015)

4. Alteration of Articles of Association

108 109
Parag Milk Foods Limited Wholesome living Corporate Overviews Statutory Reports Financial Statements

(e) Stock Code: (h) The securities of the Company have never been (j) Share Transfer System
suspended from trading
Stock Exchange Code Pursuant to the provisions of Regulation 40 of SEBI Listing
(i) Registrar and Share Transfer Agents Regulations and various notifications issued in that regard,
BSE 539889
requests for effecting transfer of securities (except in case
NSE PARAGMILK The Registrar and Share Transfer Agent of the Company of transmission or transposition of securities) are not to
M/s. KFIN Technologies Private Limited (“KFINTECH”) be processed from April 01, 2019 unless the securities
ISIN: INE883N01014 shall continue to act as the Registrar and Share Transfer are held in the dematerialized form with the depositories.
Agent of the Company. Further, SEBI vide its circular no. SEBI/HO/MIRSD/RTAMB/
(f) Market Price Data:
CIR/P/2020/236 dated December 2, 2020 read with
KFIN Technologies Private Limited (“KFINTECH”),
The details of monthly high/low market price of the Equity shares of the Company at BSE Ltd (BSE) and at the National Stock circular no. SEBI/HO/MIRSD/RTAMB/CIR/P/2020/166 dated
Registrar & Share Transfer Agent (R&TA) of the Company
Exchange of India Ltd (NSE) for the year under review is provided here under: September 07, 2020 had fixed March 31, 2021 as the cut-
is responsible for handling the entire share registry work,
off date for re-lodgement of physical shares for transfer and
both physical and electronic shares. Accordingly, all
Month BSE NSE the shares that are re-lodged for transfer shall be issued
documents, transfer deeds, demat requests and other
High Low Closing High Low Closing only in demat mode. In view of the same, Shareholders are
communications in relation thereto should be addressed
April-20 108.00 62.00 91.05 108.80 61.95 90.95 requested to take action to dematerialize the Equity Shares
to the R&TA at the following office:
of the Company promptly.
May-20 94.00 83.75 87.55 91.70 82.95 87.55
KFIN Technologies Private Limited
June-20 111.00 87.30 95.85 110.00 87.00 95.85 The requests for transmission or transposition of securities
Unit: Parag Milk Foods Limited held in physical form are registered and returned within
July-20 100.95 84.35 84.70 100.95 84.00 84.70
Selenium Building Tower B, Plot number 31 & 32, a period of 15 days from the date of receipt in case the
August-20 121.40 83.85 105.25 121.50 84.40 105.15 Financial District,Nanakramguda, Serilingampally documents are complete in all respects. The same are
September-20 113.55 91.05 106.35 113.80 91.00 106.35 Hyderabad – 500032 placed for consideration of the Stakeholders’ Relationship
October-20 120.70 99.25 106.05 120.75 99.05 106.15 Email ID: mohsin.mohd@kfintech.com Committee. Further, particulars of movement of shares
Phone: +91 40 67161562 /67161583 in the dematerialized form are also placed before the
November-20 118.50 103.00 109.60 118.35 102.80 109.55
Website: www.kfintech.com Stakeholders’ Relationship Committee.
December-20 125.35 102.35 114.45 125.50 102.20 114.35
January-21 129.30 106.90 110.85 129.30 106.65 110.75 (k) Distribution of shareholding of shares of the Company as on March 31, 2021 is as follows:
February-21 119.00 105.05 107.25 119.20 104.00 107.30
The broad shareholding distribution of the Company as on March 31, 2021 with respect to size of holdings was as follows:
March-21 113.90 94.00 105.55 114.15 94.00 105.55
Sr Distribution of Shareholding as on 31/03/2021 (TOTAL)
Source: BSE and NSE Websites
No. Category (Shares) No.of Holders % To Holders No.of Shares % To Equity
(g) Performance of the Company’s Equity Share Price in comparison to BSE and NSE Indices 1 1 - 5000 52,502 98.94 125,08,552 14.87

The performance of the Company’s equity share price vis-à-vis the broad based BSE and NSE indices during the year are as 2 5001 - 10000 294 0.55 21,74,159 2.58
under: 3 10001 - 20000 120 0.23 16,97,176 2.02
4 20001 - 30000 45 0.08 11,01,650 1.31
Parag Milk Foods ltd’s Share Parag Milk Foods ltd’s Share 5 30001 - 40000 19 0.04 6,69,608 0.80
Price vs BSE Sensex Price vs Nifty
6 40001 - 50000 10 0.02 4,49,752 0.53
140 60,000 140.00 20,000 7 50001 - 100000 32 0.06 24,99,477 2.97
120 50,000 120.00 8 100001 and above 43 0.08 6,30,14,208 74.91
100.00 15,000
100 TOTAL: 53,065 100.00 8,41,14,582 100.00
40,000 80.00
80 10,000
30,000 60.00 The quarterly shareholding patterns filed with the stock exchanges are also available on the website of the Company and on
60 40.00
20,000 5,000 the website of the stock exchanges where equity shares of the Company are listed i.e., BSE and NSE
40 20.00
20 10,000 0.00 0
0 0
Apr-20

Jun-20

Aug-20

Oct-20
Nov-20
Dec-20

Feb-21

Mar-21
Sep-20
May-20

Jan-21
Jul-20
0
0

20

20

1
-2
-2
r-2

-2
n-

c-

b
g

ct

Fe
Ap

De
Ju

Au

Share Price BSE Sensex Share Price NSE Nifty

110 111
 Parag Milk Foods Limited Wholesome living Corporate Overviews Statutory Reports Financial Statements

Shareholding Pattern as on March 31, 2021 However in the month of May 2021 the Company has (n) Commodity price risk or foreign exchange risk and
issued 10,680 Foreign Currency Convertible Bonds hedging activities;
The shareholding pattern of the Company as on March 31, 2021 with respect to categories of investors is as follows: (FCCBs) (unlisted, unsecured, unrated) of face value of $
1000 each allotted to International Finance Corporation The Company is not dealing in any commodities. The
Category of Shareholder(s) No. of No. of Shares % of No. (IFC) for an amount aggregating to US $10,680,000/- Company has foreign exchange exposure but it is not
Shareholders of Shares (Dollars Ten Million Six Hundred and Eighty Thousand) considered necessary to have any hedging cover.
(A) Shareholding of Promoter and Promoter Group (o) Plant Location
(a) Individuals 10 3,88,61,435 46.20
The Company has the following manufacturing and operating Divisions:
(b) Bodies Corporate - - -
Total Shareholding of Promoter and Promoter Group (A) 10 3,88,61,435 46.20 Sr. Plant Location
(B) Public Shareholding No.
(1) Institutions 1. Plant 1 Manchar Plant: Awasari Phata, Post Manchar, Tal. Ambegoan Dist. Pune - 410 503 Maharashtra
(a) Mutual Funds 0 0 0.00 2. Plant 2 Palamaner Plant; 149/1, Samudra Palli (Village), Pengaragunta (P.O.), Palamaner (Mdl), Chittoor
(b) Banks/FI 1 50 0.00 (Dist.), A.P. – 517 408

(c) Venture Capital Funds 1 50,42,534 5.99 3. Plant 3 Sonipat Plant: Plot No. 2266-2268, Food Park, Phase-2, HSIIDC Industrial Estate- Rai, Sonipat,
Haryana – 131029
(d) Foreign Portfolio Investors 25 51,30,116 6.10
(e) Alternative Investment Funds 0 0 0 (p) Address for correspondence
(e) Other Foreign Investors - - -
• All Members correspondence should be forwarded to M/s. KFIN Technologies Private Limited, the Registrar and Transfer Agent
Sub-Total (B)(1) 27 1,01,72,700 12.09 of the Company or to the Investor Relations team at the Corporate Office of the Company at the addresses mentioned below.
(2) Non-Institutions
• The Company’s dedicated e-mail address for Investors’ Complaints and other communications is investors@parag.com
(a) Bodies Corporate 273 68,59,075 8.15
(b) Individuals • SEBI vide its circular dated March 26, 2018 issued new policy measures w.r.t. SEBI Complaints Redress System (SCORES). As per
the new process, SEBI has requested the Members to approach the Company directly at the first instance for their grievances.
(i) Individual shareholders holding nominal 51414 1,46,72,079 17.44
share capital upto ` 2 lakh
KFIN Technologies Private Limited Compliance Officer Investor Relations
(ii) Individual shareholders holding nominal 76 1,07,05,384 12.73 (Formerly known as Karvy Fintech Private
share capital in excess of ` 2 lakh Limited) Ms. Rachana Sanganeria Ms. Sangeeta Tripathi
(c) Non Resident Indian (NRI) 794 9,22,418 1.10 Unit : Parag Milk Foods Limited Company Secretary & Compliance Senior Manager - Investor Relations
Officer investors@parag.com &
(d) Clearing Members 189 14,66,729 1.74 Selenium Building Tower B, Plot 31-
E-mail: cs@parag.com sangeeta.tripathi@parag.com
32, Financial District,Nanakramguda,
(e) NON RESIDENT INDIAN NON REPATRIABLE 281 2,78,747 0.33 Phone: (022) 62805555 Phone: (022) 43005555
Serilingampally, Hyderabad,
Sub-Total (B)(2) 53,027 3,49,04,432 41.50 Rangareddi, Telangana - 500 032
Phone: +91- 040 – 67161562/ 67161583
Total Public Shareholding (B)=(B)(1)+(B)(2) 53,054 4,50,77,132 53.59
Fax: +91 - 040 - 23001153
(C) Non Promoter - Non Public Shareholder E-mail: mohsin.mohd@kfintech.com
(a) Custodian/DR Holder - - - Website: www.kfintech.com

(b) Employee Benefit Trust (under SEBI(Share based 1 1,76,015 0.21 (q) Credit Rating
Employee Benefit) Regulations 2014)
During the year under review the Credit Rating assigned to the Company by ICRA Limited in respect of Line of Credit
Total (A)+(B)+(C) 53,065 8,41,14,582 100
for long term facility was revised and the negative outlook on the long-term rating has been removed and upgrad-
(l) Dematerialisation of shares and liquidity include easy liquidity, ease of trading and transfer, and ed to “watch with developing implications” and in respect of line of credit for short term from [ICRA] A2+ (ICRA
elimination of any possibility of loss of documents and A two plus) its “On Watch”. The detailed report(s) of credit Rating obtained by the Company can be accessed at
The Company’s shares are dematerialised, with both the bad deliveries. www.paragmilkfoods.com.
depositories, viz. National Securities Depository Limited
(NSDL) and Central Depository Services (India) Limited (m) Outstanding Global Depository Receipts (GDRs) or
(CDSL). As on date, except eight (8) shares held by one American Depository Receipts (ADRs) or warrants or
shareholder in physical form, all other shares are held in any convertible instruments, conversion date and likely
dematerialised form only. impact on equity;

Members who still hold share certificates in physical The Company has not issued any GDRs/ ADRs or
form are advised to dematerialize their shareholding to Warrants or any other Convertible Instruments that are
avail of numerous benefits of dematerialization, which outstanding during the relevant financial year.

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 Parag Milk Foods Limited Wholesome living Corporate Overviews Statutory Reports Financial Statements

OTHER DISCLOSURES (l) Disclosures in relation to the Sexual Harassment of

Women at Workplace (Prevention, Prohibition and
(a) Disclosures on materially significant related party NIL Redressal) Act, 2013
transactions that may have potential conflict with the
i. Number of complaints filed during the financial year NIL
interests of listed entity at large
2020-21:
(b) Details of non-compliance by the listed entity, penalties, NIL
ii. Number of complaints disposed of during the financial NIL
strictures imposed on the listed entity by stock exchange
year 2020-21:
(s) or the board or any statutory authority, on any matter
related to capital markets, during the last three years; iii. Number of complaints pending as on end of the NIL
financial year 2020-21:
(c) Details of establishment of vigil mechanism, whistle The company has adopted a Whistle Blower Policy
blower policy, and affirmation that no personnel has and has established vigil mechanism in line with the (m) Non-compliance of any requirement of corporate Our company is fully compliant with Listing Regulations
been denied access to the audit committee requirements under the Companies Act, 2013 and Listing governance report of sub-paras (2) to (10) above reasons and there are no such non-compliances. Not applicable,
Regulations for the employees and other stakeholders and thereof shall be disclosed since all the requirements have been complied with.
the details are available at the Company’s website,www.
(n) The corporate governance report shall also disclose i) The Board:
paragmilkfoods.com No personnel have been denied
the extent to which the Discretionary requirements as
access to the Audit Committee The requirement relating to maintenance of office
specified in Part E of Schedule 11 have been adopted.
(d) Details of compliance with mandatory requirements The company has disclosed and complied with all the and reimbursement of expenses of Non - Executive
and adoption of Non-mandatory requirements mandatory requirements under Listing Regulations. the Chairman is not applicable to the Company since the
details of these compliances have been given in the Chairman of the Company is an Executive Director.
relevant sections of this report and adoption of non-
mandatory requirements is given in point 12 below ii) Shareholder Rights:

(e) Web link where policy for determining material The policy for determining ‘material subsidiaries’ is The Company has not adopted the practice of sending
subsidiaries is dislosed disclosed company’s website at www.paragmilkfoods. out half - yearly declaration of financial performance
com/investors/corporate governance/policies to shareholders. Quarterly results as approved by the
Board are disseminated to the Stock Exchanges and
(f) Web link where policy on dealing with related party is The policy for dealing with Related Party transactions is
updated on the website of the Company
disclosed disclosed at company’s website www.paragmilkfoods.
com/investors/corporate governance/policies
iii) Modified Opinion(s) in Audit Report:
(g) Disclosure of commodity price risks and commodity Not applicable, as the Company is not dealing with any
hedging activities ”commodities” There are no modified opinions in audit report.
(h) Details of utilization of funds raised through preferential During the year, the Company has not raised any funds a. Reporting of Internal Auditor
allotment or qualified institutions placement as through preferential allotment or qualified institutions
specified under Regulation 32 (7A) placement In accordance with the provisions of Section 138
(i) A certificate from a company secretary in practice that The Company has obtained a certificate from “N. L. of the Act, the Company has appointed an Internal
none of the directors on the board of the company have Bhatia and Associates”, practicing company secretaries Auditor who reports to the Audit Committee.
been is attached debarred or disqualified from being that none of the Directors on the Board of the company Quarterly internal audit reports are submitted
appointed or continuing as directors of companies by have been debarred or disqualified from being appointed to the Audit Committee which reviews the audit
the Board/Ministry of Corporate Affairs or any such or continuing as Directors of companies by the SEBI/ reports and suggests necessary action.
statutory authority Ministry of corporate affairs or any such statutory (o) The disclosures of the compliance with corporate The Company has complied with the requirements
authority in accordance with Listing Regulation.Further, governance requirements specified in regulation 17 to specified in regulation 17 to 27 and clauses (b) to (i) of
in terms of the provisions of the Circular No. CIR/CFD/ 27 and clauses (b) to (i) of sub-regulation (2) of regulation Sub-regulation (2) of regulation 46 (2)
CMD1/27/2019 dated 8th February, 2019 issued by 46 (2) of Regulation shall be made in the section on
Securities and Exchange Board of India, the Company corporate governance of the Annual Report
has obtained the Annual Secretarial Compliance Report
for the financial year ended March 31, 2021, confirming D. Declaration signed by the Manging Director stating that with the IEPF Authority (Accounting, Audit, Transfer
compliance of the applicable SEBI Regulations and the members of the board of directors and the senior and Refund) Rules, 2016 (hereinafter referred to as
circulars/guidelines issued thereunder, by the Company.
management personnel have affirmed compliance “IEPF Rules”) (including any statutory modification(s)
(j) Where the board had not accepted any recommendation During the year, there has been no occasion where the with the code of conduct of board of directors and or re-enactment(s) thereof for the time being in
of any committee of the board which is mandatorily Board has not accepted any recommendation of any
senior management is annexed to this report CEO/CFO force), the amount of dividend remaining unclaimed
required for the relevant financial year, the same to be of the committees
disclosed along with reasons thereof: Certification: or unpaid for a period of seven years from the date of
transfer to the unpaid dividend account is required to
(k) Total fees for all services paid by the Company and its The Audit Fees paid to M/s Sharp & Tannan the statutory E. Compliance certificate obtained from M/s. N. L. Bhatia
subsidiaries, on a consolidated basis, to the statutory auditors for FY 2020-21 be transferred to the IEPF, maintained by the Central
& Associates, firm of practicing company secretaries, Government.
auditor and all entities in the network firm / network
regarding compliance of conditions of corporate
entity of which the statutory auditor is a part: i. Parag Milk Foods Limited -
governance, is annexed to this report. Pursuant to the provisions of Section 124 of the Act
Total Audit Fees - ` 3.17 Million read with the Investor Education and Protection Fund
F. Unclaimed Dividend: Authority (Accounting, Audit, Transfer and Refund) Rules,
Audit Fees - ` 2.42 Million
Limited Review Fees - ` 0.75 Million 2016, as amended (‘IEPF Rules’), all the shares on which
In accordance with the provisions of Sections 124, 125
dividends remain unpaid or unclaimed for a period of
and other applicable provisions, if any, of the Act, read
ii Bhagyalaxmi Dairy Farms Pvt Ltd - ` 0.26 Million

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 Parag Milk Foods Limited Wholesome living Corporate Overviews Statutory Reports Financial Statements

seven consecutive years or more shall be transferred to The Company has uploaded the details of unpaid and DECLARATION BY MANAGING DIRECTOR ON COMPLIANCE WITH THE COMPANY’S
the demat account of the IEPF Authority as notified by the unclaimed amounts lying with the Company as on March
CODE OF CONDUCT
Ministry of Corporate Affairs. 31, 2021 on the Company’s website at https://www.
paragmilkfoods.com.
In terms of the provisions of IEPF Rules, no amounts of
unpaid / unclaimed dividends and shares were required Members can claim the unpaid dividend from the To,
to be transferred during the financial year 2020-21 to Company before it is transferred to the Investor Education The Members of
Parag Milk Foods Limited
the IEPF. The Company did not have any funds lying and Protection Fund. As per the Investor Education
unpaid or unclaimed for a period of Seven years. Protection Fund Authority (Accounting, Audit, Transfer The Company has formulated a Code of Conduct for Board of Directors and Senior Management Personnel of the Company. The
Therefore there were no funds which were required and Refund) Rules, 2016 (IEPF), the transferred dividend Code has been posted on the Website of the Company. It is hereby affirmed that all Directors and Senior Managers have complied
to be transferred to investor Education and Protection can be claimed by the concerned member by making with the Code of Conduct framed by the Company and a confirmation to this effect for the year 2020-21 has been obtained from
Fund (IEPF). an application in Form IEPF-5 along with necessary all the Directors and Senior Managers.
documents to the IEPF authority. Sd/-
Mr. Pritam Shah
Disclosure with respect to demat suspense account / unclaimed suspense account
Place : Mumbai Managing Director
Date : June 04, 2021 (DIN : 01127247)
Sr. No. Particulars No. of Shareholders No. of Equity Shares
a) Aggregate number of shareholders and the outstanding 0 0
shares lying in the Unclaimed Suspense Account as on
MANAGING DIRECTOR/CFO CERTIFICATE
April 01, 2020 To,
b) Number of shareholders who approached the Company for 0 0 The Board of Directors,
Parag Milk Foods Limited
transfer of shares from the Unclaimed Suspense Account
during the year We, Pritam Shah – Managing Director and Shashikant Dalmia – Chief Financial Officer of Parag Milk Foods Limited, to the best of
c) Number of shareholders to whom the shares were transferred 0 0 our knowledge and belief, certify that:
from the Unclaimed Suspense Account during the year 1) We have reviewed the Financial Statements for the Financial Year ended March 31, 2021 and to the best of our knowledge and
d) Number of shareholders whose unclaimed dividends 0 0 belief:
were transferred to the IEPF account in terms of Ministry
a. these statements do not contain any materially untrue statement or omit any material fact or contain statements that might
of Corporate Affairs General Circular No. 12/2017 dated be misleading;
October 16, 2017
b. these statements together present a true and fair view of the Company’s affairs and are in compliance with existing Accounting
e) Aggregate number of shareholders and the outstanding 0 0
Standards, applicable laws and regulations.
Shares lying in the Unclaimed Suspense Account as on
March 31, 2021 2) To the best of our knowledge and belief, no transactions entered into by the Company during the Financial Year ended March
f) It is hereby confirmed that the voting rights on these shares N.A N.A 31, 2021 are fraudulent, illegal or violate the Company’s code of conduct.
shall remain frozen till the rightful owner of such shares claims 3) We accept responsibility for establishing and maintaining Internal Controls for Financial Reporting and we have evaluated
the shares. the Effectiveness of Internal Control Systems of the Company pertaining to financial reporting. Deficiencies in the design
or operation of such internal controls, if any, of which we are aware, have been disclosed to the auditors and the Audit
Committee and steps have been taken to rectify these deficiencies.

For Parag Milk Foods Limited 4) We have indicated to the auditors and the Audit Committee that:

Sd/- a. There has not been any significant change in internal control over financial reporting during the year under reference;
Devendra Shah b. There has not been any significant change in accounting policies during the year requiring disclosure in the notes to the
Date: July 29, 2021 Chairman financial statements; and
Place: Mumbai (DIN: 01127319)
c. We are not aware of any instance during the year of significant fraud with involvement therein of the management or any
employee having a significant role in the Company’s internal control system over financial reporting.

Pritam Shah Shashikant Dalmia

Place: Mumbai Managing Director Chief Financial Officer
Date: June 04, 2021 DIN: 01127247

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Parag Milk Foods Limited Wholesome living Corporate Overviews Statutory Reports Financial Statements

CERTIFICATE OF NON-DISQUALIFICATION OF DIRECTORS PRACTICING COMPANY SECRETARIES’

Pursuant to Regulation 34(3) and Schedule V Para C clause (10)(i) of the SEBI (Listing Obligations and Disclosure Requirements) CERTIFICATE ON CORPORATE GOVERNANCE
Regulations, 2015)

To, issuing this Certificate, in accordance with Regulation 34(3) To,

The Members, read with Schedule V Para-C Sub clause 10(i) of the Securities The Members,
Parag Milk Foods Limited, Exchange Board of India (Listing Obligations and Disclosure Parag Milk Foods Limited
Flat No.1, Plot No.19, Requirements) Regulations, 2015.
Nav Rajasthan Soc., Behind Ratna Memorial Hospital, We have examined all the relevant records of Parag Milk Foods Limited (‘the Company’) for the purpose of certifying compliance
S.B. Road, Shivaji Nagar In our opinion and to the best of our information and according of the conditions of Corporate Governance under Chapter IV to the Securities and Exchange Board of India (Listing Obligations
Pune- 411016 to the verifications (including Directors Identification Number and Disclosure Requirements) Regulations, 2015 (‘Listing Regulations’) for the period from April 01, 2020 to March 31, 2021. We
(DIN) status at the portal www.mca.gov.in) as considered have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose
We have examined the relevant registers, records, forms, necessary and explanations furnished to us by the Company & of certification.
returns and disclosures received from the Directors of Parag its officers, we hereby certify that none of the Directors on the
Milk Foods Limited having CIN L15204PN1992PLC070209 and Board of the Company as stated below for the financial year The compliance of conditions of Corporate Governance is the responsibility of the Management. Our examination was limited to
having registered office at Flat No.1, Plot No.19, Nav Rajasthan ending on March 31, 2021 have been debarred or disqualified procedures and implementation process adopted by the Company for ensuring the compliance of the conditions of the Corporate
Soc., Behind Ratna Memorial Hospital, S.B. Road, Shivaji Nagar, from being appointed or continuing as Directors of companies Governance. This certificate is neither an audit nor an expression of opinion on the financial statements of the Company.
Pune - 411016 (hereinafter referred to as ‘the Company’), by the Securities and Exchange Board of India, Ministry of
produced before us by the Company for the purpose of Corporate Affairs, or any such other Statutory Authority. In our opinion and to the best of our information and according to the explanations and information furnished to us, we certify that
the Company has complied with all the conditions of Corporate Governance as stipulated in the Listing Regulations.

We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or
Sr. Name of Director DIN Date of appointment effectiveness with which the Management has conducted the affairs of the Company.
No. in Company
1. Radhika Dudhat 00016712 26/05/2015 For N L Bhatia & Associates
Practising Company Secretaries
2. Ramesh Chandak 00026581 24/06/2016 UIN: P1996MH055800
3. Bharatkumar Mahendrabhai Vyas 00043804 22/07/2010
N. L. Bhatia
4. Narendra Kumar Anand Ambwani 00236658 26/05/2015 Managing Partner
5. Pritam Prakash Shah 01127247 29/12/1992 Place: Mumbai FCS: 1176
Date: July 28, 2021 CP. No. 422
6. Devendra Prakash Shah 01127319 29/12/1992
7. Nitin Ramchandra Dhavalikar 07239870 28/07/2015

Ensuring the eligibility for the appointment / continuity of every Director on the Board is the responsibility of the management of
the Company. Our responsibility is to express an opinion on these based on our verification. This certificate is neither an assurance
as to the future viability of the Company nor of the efficiency or effectiveness with which the management has conducted the
affairs of the Company.

For M/s N L Bhatia & Associates

Practising Company Secretaries
UIN: P1996MH055800

Bhaskar Upadhyay
Partner
FCS: 8663
Place: Mumbai CP. No. 9625
Date: June 28, 2021 UDIN: F008663C000526411

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Parag Milk Foods Limited Wholesome living Corporate Overviews Statutory Reports Financial Statements

Business Responsibility Report SECTION B: FINANCIAL DETAILS OF THE COMPANY

Sr. No. Particulars Company Information

[Pursuant to Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015]
1 Paid up Capital (INR): ` 841.14 Million
2 Total Turnover (INR): ` 17,917.35 Million
The Company’s Business Responsibility Report 2020- Our Business Responsibility Report includes our responses to
21 follows the National Voluntary Guidelines (NVGs) on questions on our practices and performance on key principles 3 Total profit after taxes (INR): ` 174.54 Million
Social, Environmental and Economic Responsibilities of defined by Regulation 34(2)(f) of the Listing Regulations, covering 4 Total Spending on Corporate Social Responsibility As per Section 135 of the Companies Act, 2013 read with the
Business released by the Ministry of Corporate Affairs topics across environment, governance, and social dimensions.
(CSR) as percentage of profit after tax (%): rules made thereunder, the Company is required to spend
(MCA), Government of India, in July 2011 which contains 9
Principles and Core Elements for each of the Principles. This The Company believes in conducting its business activities at least 2% of average net profit of last 3 financial years i.e.,
report substantially complies with the National Guidelines in a responsible and sustainable manner which is ultimately ` 28.24 Million
on Responsible Business Conduct (NGRBC) released by beneficial to everyone. The Company focusses on efficient
MCA in 2019. deployment of resources, including people, processes The Company has spent ` 40.05 Million on CSR activities for FY
and materials, for the production of safe and eco-efficient 2020-21. The Company has spent in excess by ` 11.81 Million.
The Directors of Parag Milk Foods Limited hereby present the products, with a view to creating value for all its stakeholders.
5 List of activities in which expenditure in 4 above The details of CSR activities undertaken for FY 2020-2021 are
Business Responsibility Report (“BRR”) of the Company for This ensures that the Company embeds balance in our
the financial year ended March 31, 2021, pursuant to the SEBI engagement with all stakeholders, keeping the community at has been incurred:- provided in Annexure-III of the Directors’ Report.
(Listing Obligations and Disclosure Requirements) Regulations, the core of whatever we do. This BRR is in line with the format
2015 (“Listing Regulations”). prescribed by Securities and Exchange Board of India (“SEBI”). SECTION C: OTHER DETAILS

SECTION A: GENERAL INFORMATION ABOUT THE COMPANY Sr. No. Particulars Company Information
1 Does the Company have any Subsidiary Company/ Yes, the company has 1 wholly owned Subsidiary as on March
Sr. No. Particulars Company Information
Companies? 31, 2021.
1 Corporate Identification Number (CIN) of the Company L15204PN1992PLC070209
2 Do the Subsidiary Company/Companies participate The subsidiary company being a separate legal entity defines
2 Name of the Company Parag Milk Foods Limited
in the BR Initiatives of the parent company? If its own initiatives specific to its business context as per rules
3 Registered Address Flat No.1, Plot No.19, Nav Rajasthan Soc., behind Ratna Memorial
yes, then indicate the number of such subsidiary and regulations as may be applicable to them whilst having
Hospital, S.B. Road, Shivaji Nagar Pune MH 411016 IN
company(s): access to information and expertise residing with the Parent
4 Website www.paragmilkfoods.com
company.
5 E-mail ID investors@parag.com
3 Do any other entity/entities (e.g. suppliers, Other entities, do not directly participate in the Business
6 Financial Year reported April 01, 2020 to March 31, 2021
distributors etc.) that the Company does business Responsibility (“BR”) initiatives of the Company.
7 Sector(s) that the Company is engaged in (industrial Name and description of main products / services: Manufacture
with, participate in the BR initiatives of the
activity code-wise) of dairy products (National Industrial Classification (NIC)
Company? If yes, then indicate the percentage of
Code: 1050)
such entity/entities? [Less than 30%, 30-60%, More
8 List three key products/services that the Company Value Added Products (such as ghee, cheese, paneer, curd, than 60%]:
manufactures/provides (as in balance sheet) buttermilk, lassi, gulab jamun mix, whey protein powders, etc.)
SECTION D: BR INFORMATION
Liquid Milk, Skimmed Milk Powder 1 DIN Number : 01127247
9 Total number of locations where business activity is 1. Details of Director/Directors responsible for BR 2 Name : Pritam Prakash Shah
undertaken by the Company:
(a) Details of the Director/Director responsible for 3 Designation : Managing Director
(a) Number of International Locations (Provide details Not Applicable
of major 5) implementation of the BR policy/policies
(b) Details of the BR head:
(b) Number of National Locations i. Three manufacturing facilities at Manchar in Maharashtra, Corporate Policies including the Business Responsibility
Palamaner in Andhra Pradesh, and Sonipat in Haryana. Policies of the Company are engrained in day-to-day No. Particulars Details
business operations of the Company and are implemented 1 DIN Number (if 01127247
ii.Registered office at Pune, Corporate offices in Mumbai, Pune
by the management and it is the responsibility of applicable)
and Delhi.
concerned functionary or head of the department (HOD) 2 Name Pritam Prakash Shah
iii.21 Depots at various locations across India and PAN - India in charge of the relevant functions at various offices /
3 Designation Managing Director
distribution network comprising of 3,000 + distributors and manufacturing facilities of the Company. The Managing
4 Telephone number 022 - 4300 5555
more than 3.5 Lakh retail touchpoints. Director of the Company oversees the implementation
10 Markets served by the Company - Local/State/ The Company sells its products across all states in India as of the BR policies keeping in view of the executives’ 5 E-mail ID pritam.shah@parag.com
National/International well as exports its products to several countries around the feedback and reporting.
world such as UAE, Singapore, Mauritius, Oman, Kuwait, Saudi
Arabia, Congo, Hong Kong, Philippines, Sri Lanka, Bangladesh,
Maldives, USA, Thailand, Nepal, Bhutan, Ghana, Malaysia, Qatar
and supplies its products to a major Quick Service Restaurant
(QSR) across Gulf Cooperation Council (GCC) countries.

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 Parag Milk Foods Limited Wholesome living Corporate Overviews Statutory Reports Financial Statements

2. Principle-wise BR Policy / policies (as per NVGs): 8 Does the company have in-house structure to Y Y Y Y Y Y Y Y Y
implement the policy/ policies.
The National Voluntary Guidelines (NVGs) on Social, Environmental and Economic Responsibilities of Business released by
the Ministry of Corporate Affairs has adopted nine areas of Business Responsibility. These are as follows: 9 Does the Company have a grievance redressal Y Y Y Y Y Y Y Y Y
mechanism related to the policy/ policies to address
Principle 1 (P1) ETHICS, TRANSPARENCY AND ACCOUNTABILITY. stakeholders’ grievances related to the policy/
Principle 2 (P2) PRODUCT LIFE CYCLE SUSTAINABILITY policies?

Principle 3 (P3) WELL-BEING OF ALL EMPLOYEES. 10 Has the company carried out independent audit/ Yes, Wherever Appropriate. Policies are reviewed periodically
evaluation of the working of these policies by an for their implementation based on the commitment framework
Principle 4 (P4) STAKEHOLDER ENGAGEMENT
internal or external agency? and all related risk controls are set in place. Policies related
Principle 5 (P5) HUMAN RIGHTS. to employee benefits and well-being are co-created, in which
Principle 6 (P6) ENVIRONMENT employees’ inputs are taken and incorporated in the policy
Principle 7 (P7) POLICY ADVOCACY. making process. The policies are a combination of board
approved policies and/or policies approved and evaluated by
Principle 8 (P8) INCLUSIVE GROWTH AND EQUITABLE DEVELOPMENT.
various departmental heads and management. As a part of
Principle 9 (P9) CUSTOMER VALUE CREATION implementation of various certifications like Food Safety, ISO-
22000, ISO-14001, ISO-45001, ISO-50001 and Environment &
BR Policies and coverage of NVG Nine principles:
Social measures, periodic assessment is conducted by third-
(a) Details of compliance (Reply in Y/N) party auditors and counter-measures are implemented.

(b) If answer to the question at serial number 1 against any principle, is ‘No’, please explain why: (Tick up to 2 options): Not
No. Questions P1 P2 P3 P4 P5 P6 P7 P8 P9
Applicable
1 Do you have a policy/ policies for the Y Y Y Y Y Y Y Y Y
abovementioned Principles? 3. Governance related to BR
2 Has the policy being formulated in Consultation Y Y Y Y Y Y Y Y Y
with the relevant stakeholders? Indicate the frequency with which the Board of Directors, The Board of Directors of the Company/ its Committees
Committee of the Board or CEO assess the BR performance assess the various business responsibility initiatives
3 Does the policy conform to any national / Yes. The spirit and intent of the Parag Code of Conduct and all
of the Company. Within 3 months, 3-6 months, Annually, undertaken by the Company at various Board and
international standards? If yes, specify? (50 words) applicable national laws are captured in the policies articulated
More than 1 year Committee Meetings which typically take place every year.
by the Company. In addition, they reflect the purpose and
The Company’s business responsibility performance is
intent of the United Nations Global Compact, and principles of
reviewed by the Board of Directors on an annual basis.
NVGs, the Companies Act, 2013 and International Standards of
ISO-22000, ISO-14001, ISO 50001, OHSAS 45001. The policies Does the Company publish a BR or a Sustainability Report? Yes, the Company publishes BR Report as a part of its Annual
have been developed based on best practices and as per What is the hyperlink for viewing this report? How frequently Report. This BR Report is uploaded on the Company’s
regulatory requirements and through appropriate consultation it is published? website at the web link - http://www.paragmilkfoods.com
with relevant stakeholders. SECTION E: PRINCIPLE-WISE PERFORMANCE
4 Has the policy been approved by the Board? Policies are approved by the Board / Senior Management
and other applicable policies are approved by the Managing Principle 1: BUSINESSES SHOULD CONDUCT AND GOVERN Further, the Company has adopted a Whistle Blower Policy
If yes, has it been signed by MD/ owner/ CEO/ Director or Functional Heads of the Company as appropriate. THEMSELVES WITH ETHICS, TRANSPARENCY AND to provide a mechanism for employees and Directors
appropriate Board Director? Further, all the policies are subject to regular review (at least ACCOUNTABILITY of the Company to approach the Chairman of the Audit
once a year) by Board / Committees of the Board / Senior Committee of the Company for reporting unethical
1. Does the policy relating to ethics, bribery and corruption
Management of the Company. behaviour, actual or suspected fraud or violation of the
cover only the company? Yes/ No. Does it extend to the
Company’s code of conduct and SEBI Insider Trading
5 Does the company have a specified committee The Company has Audit Committee, Internal Complaints Group/Group/ Joint Ventures/ Suppliers/ Contractors/
Regulations.
of the Board/ Director/ Official to oversee the Committee, Stakeholders Relationship Committee, Corporate NGOs/ Others ?
implementation of the policy? Social Responsibility (CSR) Committee and also adequate The Code of Conduct is imbibed in all aspects of the
internal control systems to oversee the implementation of Response - The policy relating to ethics, transparency
business and its dealing with various stakeholders.
policies. The Company has set up various processes to monitor and accountability covers the Company and its group
Training and awareness on Code of Conduct is provided
the effectiveness of these policies. companies as well as the Suppliers / Contractors /
to all employees and other stakeholders are also made
NGOs dealing with the Company who are encouraged
6 Indicate the link for the policy to be viewed online? As per regulatory requirements the policies of the Company aware of the same from time to time.
to maintain ethical standards in all their practices. The
have been uploaded on the website of the Company except HR
Company has a Code of Conduct for its Directors and The Company’s code of conduct comprises ethics and
policies at https://www.paragmilkfoods.com/policies.
Employees that covers issues inter alia related to ethics, values, anti-bribery and anti-corruption, management
HR policies are restricted to employees of the Company. workplace responsibilities and conflict of interest. It also of conflict of interest amongst employees or other
7 Has the policy been formally communicated to all Y Y Y Y Y Y Y Y Y covers all dealings with suppliers, customers and other stakeholders, amongst other related aspects and is
relevant internal and external stakeholders? business associates. applicable to all employees and directors. The Company

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Parag Milk Foods Limited Wholesome living Corporate Overviews Statutory Reports Financial Statements

has no tolerance in matters relating to unethical practices, others are given in the Annexure IV to the Board Report Additionally, the Company has also promoted skills and aerobic treatment, MBR followed by MGF, ACF and RO.
bribery or corruption. contained in this Annual Report. livelihood development in the neighbouring community This permeate water is used inside the plant for cooling
through various training and community development towers, floor cleaning, gardening and toilets.
2. How many stakeholder complaints have been received 3. Does the company have procedures in place for programmes. The Company, wherever possible,
in the past financial year and what percentage was sustainable sourcing (including transportation)? If endeavors to support and encourage employment All condensate from the evaporator is reutilised for
satisfactorily resolved by the management? If so, yes, what percentage of your inputs was sourced among communities surrounding its place of work and cooling towers, CIP stations, hygiene stations and boiler
provide details thereof, in about 50 words or so. sustainably? Also, provide details thereof, in about 50 has generated large-scale employment in the villages it and 12% of fresh water, 90% of steam condensate and 90
words or so. operates in. % of the Milk condensate is recovered.
Response - Details relating to complaints from investors
during the financial year and redressal thereof is given in Response - A major part of the Company’s raw material The company has also developed an eco-system for We recover average 150 KL per day RO water from NF-RO
Corporate Governance Report contained in this Annual is raw milk, which is sourced from 2 Lakh+ farmers and is providing financing support to these small vendors plant.
Report. No stakeholder complaints were received by the therefore a 100% sustainable sourcing. Across the entire and have developed various vendors like transport
Company during the financial year pertaining to bribery, supply chain, the Company endeavours to integrate Our ambition is to send zero waste to landfills, and we
contractors, small packaging suppliers, office supplies
corruption, Child labour, forced or compulsory labour. social, ethical and environmental factors in its operating/ continue to consciously work on further segregation,
contractors, etc. over the period.
Additionally, the complaints, grievances or views from strategic decisions. The Company endeavours to reduce recycling, and reduction of mixed waste to landfill.
other stakeholders are dealt with by respective functional the distance travelled overall by its products, thereby 5. Does the company have a mechanism to recycle
Principle 3: BUSINESSES SHOULD PROMOTE THE
heads of the Company. reducing emissions on account of transportation. Our products and waste?
WELLBEING OF ALL EMPLOYEES.
company policies guide our efforts to ensure we work
The Whistle Blower Mechanism, enables Directors and with suppliers who endorse environmental protection If yes what is the percentage of recycling of products
The employee policies at the Company are designed to
employees to voice their concerns or observations and sustainable use of scarce natural resources, protect and waste (separately as <5%, 5-10%, >10%). Also,
provide an inclusive environment that engages all employees
without fear. It allows reporting of instances relating to human rights, and adhere to all applicable laws of the provide details thereof, in about 50 words or so.
and inspires them to grow. It provides the work environment
any unethical or unacceptable business practice or event land. The Company maintains a healthy relationship with
Response - The Company while pursuing energy that promotes well-being of its employees while giving them
of misconduct/ unethical behaviour, actual or suspected its suppliers, vendors and other service providers and the
efficiency programs in the factories also takes initiatives various opportunities to grow. Alongside its responsibility to
fraud and violation of the Company’s polices, among business practices of the Company include them in its
for recycling of wastes generated during production. provide a safe and hazard-free working environment for its
others. The Mechanism provides adequate safeguard growth. The process of vendor selection and registration
As an environmentally responsible company, we have employees, the Company also recognises the importance of
against victimization of the Whistle Blowers and enables lays emphasis on safe working conditions, prevention of
adopted a focused approach to managing the waste employee wellbeing. Helping employees to achieve work-life
them to raise concerns to the Integrity Committee. It also child labour, business ethics and general housekeeping
generated by our operations. Our waste management balance, creating comfortable efficient workplaces, offering
provides an option of direct access to the Chairperson of by the vendor.
strategy is framed around the three Rs namely Reduce, performance-based remuneration and driving engagement
the Audit Committee
Reuse, and Recycle. through frequent communication are practices that we
4. Has the company taken any steps to procure goods
Principle 2: BUSINESSES SHOULD PROVIDE GOODS AND embrace as a responsible employer to help workers re-energise
and services from local & small producers, including
SERVICES IN A MANNER THAT IS SUSTAINABLE AND SAFE The Bhagyalaxmi Dairy Farm Pvt Ltd, the wholly - owned and continue to perform well.
communities surrounding their place of work?
subsidiary of the Company, is a “Zero wastage farm” which
1. List up to 3 of your products or services whose design furthers the Company’s sustainability agenda by reducing, 1. Please indicate the Total number of employees.
(a) If yes, what steps have been taken to improve their
has incorporated social or environmental concerns, capacity and capability of local and small vendors? reusing, and recycling the waste that is generated at the
Response - The Company has 1563 permanent employees
risks and / or opportunities. farms. At the farm, a bio-gas plant as well as solar panels
(excluding subsidiary employees) as on March 31, 2021.
Response - The Company procures milk, which is a have been installed that generate captive electricity for the
Response - Environment, health and safety continue to major part of its raw materials sourced, from the farmers farm’s own energy consumption using cow waste such as 2. Please indicate the Total number of employees hired on
be key focus areas and the Company strives to reduce in the local vicinity of its manufacturing facilities. The manure and urine. Moreover, the by-products of the bio- temporary/contractual/casual basis.
its environmental impact through various initiatives in the Company daily procures from more than 2 Lakh farmers gas plant are converted into a range of organic fertilisers
field of Energy Efficiency and Conservation. located in five various states of the country and thereby which are provided to farmers. All these fertilisers are Response - The Company has a total of more than 1091
supports them by giving a source of livelihood for them. efficiently used upon the soil of the farmer’s crops, which employees hired on temporary/ contractual/ casual basis
a. Gowardhan Ghee
The company also provides ancillary services such as when fed to their cattle, provides them with the required as on March 31, 2021.
b. Gowardhan Paneer supplying farmers with cattle feed at subsidized rates, nutrition resulting in high yield of their cattle.
3. Please indicate the Number of permanent women
free health checkups and vaccinations for their cattle
c. Pride of Cows (Milk, Curd) We have installed Effluent Treatment Plant (ETP) at our employees.
and educating them about the ways of improving the
productivity and yield of their cows and cattle. Manchar facility. The waste water from the plant has solid
2. For each such product, provide the following details Response - The Company has 113 permanent women
waste containing FOG (Fats, Oils and Grease) which is
in respect of resource use (energy, water, raw material employees as on March 31, 2021.
The Company believes its factories must benefit the passed through Dissolved Air Floatation (DAF) to reduce
etc.) per unit of product (optional): communities in which they are located. It sources most TSS (Total Suspended Solids) and is then passed through The Company maintains a gender inclusive environment
of the raw materials from areas near the factories. It a Centrifuge (Decanter) which separates the solid and and believes in equal opportunities for all at workplace
Response - The Company has taken up energy
extensively works with its vendors to improve capacities water. The solid part is then dried on sludge drying beds keeping aside the gender bias.
conservation programmes involving its own team and
and capabilities. The Company also obtains services and is used as bio compost (organic manure) after mixing
experts from outside. The Company is conscious about
from local & small service providers for maintenance with other fertilisers. The solid waste is less than 2%. 4. Please indicate the Number of permanent employees
judicious use of water, energy and resources in form of
and repairs of building, plant and machineries thereby with disabilities
raw materials in course of production and manufacturing At the ETP plant more than 60% of the waste water
supporting the local community to have source of living.
activities. Additional details relating to energy and is recycled through the following steps - Primary Response - Being an equal opportunity employer
treatment by DAF followed by anaerobic treatment, company, we encourage employees to disclose their

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 Parag Milk Foods Limited Wholesome living Corporate Overviews Statutory Reports Financial Statements

disabilities and seek reasonable accommodation allowing Principle 4: BUSINESSES SHOULD RESPECT THE INTERESTS company conducted many online training programs and well-being. For more details on the Company’s work
them to perform to their full potential. OF, AND BE RESPONSIVE TOWARDS ALL STAKEHOLDERS workshops such as with the disadvantaged, vulnerable and marginalised
ESPECIALLY THOSE WHO ARE DISADVANTAGED, VULNERABLE stakeholders, refer to the Report on Corporate Social
The number of employees who have voluntarily disclosed AND MARGINALISED 1 Signage Board (Covid-19) Training to all employees Responsibility Activities which forms part of the Annual
their disability status and the nature of disability stands at Report.
2 Corona Prevention & Awareness to all employees
1 as on March 31, 2021. The Company understands the needs of its stakeholders and
aims to meet the expectations of its stakeholders. It discloses 3 Online training on Covid 19 prevention to Functional 3. Are there any special initiatives taken by the company
5. Do you have an employee association that is recognized all the relevant information about its products, business, Heads conducted by Nestle to engage with the disadvantaged, vulnerable and
by management? financial performance, press releases and other statutory marginalized stakeholders. If so, provide details thereof,
4 System Managers FSSAI online training on Covid
information on the website of the Company to ensure effective Guidelines in about 50 words or so.
Response - No, there are No employee associations,
stakeholders engagement.
which are recognised by the management 5 Personal Hygiene Response - The Company always endeavors to think
1. Has the company mapped its internal and external 6 Chemical & Electrical Safety beyond business and undertakes various initiatives to
6. What percentage of your permanent employees is
stakeholders? improve the lives of the lower socio-economic sections
members of this recognized employee association? 7 Emergency Mock Drill
of the society. While developing its CSR strategy, the
Response - Yes. The Company deals with various 8 Awareness about Energy use in Significant Area Company has ensured that all communities benefit from
Response - NIL
stakeholders viz. business partners, employees, contract the CSR activities, with special focus on groups that are
9 Pest management in food industry
7. Please indicate the Number of complaints relating to workers and suppliers. Engagement with the mapped socially and economically marginalised, including rural
child labour, forced labour, involuntary labour, sexual stakeholders is an on-going process which takes place 10 Special food was arranged on many occasions for
unemployed youth, women, scheduled castes and tribes.
harassment in the last financial year and pending, as on through various formal and informal channels. the employees
the end of the financial year. 11 Birthday celebrations of employees were held The Company has undertaken special initiatives for the
Investor Engagement development of underprivileged communities in and around
Response - The Company has a Prevention of Sexual 12 Employees medical health check-up camp was held
its plants, business locations and project sites. These initiatives
The Company regularly interacts with its shareholders
Harassment (POSH) policy in accordance with the 13 Annual Sales Meet was held are in the areas of preventive healthcare, education, drinking
and investors and keeps them updated on the Company’s
statutory requirements of Sexual Harassment of Women water, sanitation, employment, skill development for the
business activities through one-on-one and group Suppliers
at Workplace (Prevention, Prohibition and Redressal) Act, local community, health care initiatives and digital literacy,
meetings, Investor Calls, participation at investor
2013. All sexual harassment complaints are diligently amongst others The Corporation’s CSR activities focus on
conferences, sending annual reports, media releases, Every day, we work with hundreds of suppliers who are
reviewed and investigated by an internal complaints the disadvantaged, vulnerable and marginalised segments
Company’s website updates and subject-specific helping us achieve the required success in the market.
committee constituted under the Prevention of Sexual of society. Further details of CSR initiatives by the Company
communications. The Annual General Meeting gives Our suppliers help us innovate, create value, build
Harassment policy. are included in a report on CSR activities forming part of this
the shareholders an opportunity to engage directly with capacity and capability, deliver quality and service and
drive market transformation. We invest in long-term Annual Report.
the Board of Directors and the Management. During
No. Category No of No of
this meeting, the Board engages with shareholders and mutual beneficial relationships with our key suppliers
complaints complaints Principle 5: RESPECT FOR HUMAN RIGHTS
answers their queries on varied subjects relating to the so we can share capabilities and co-innovate for shared
filed pending as
company’s operation, business, performance and other growth and success for all. 1. Does the policy of the Company on human rights
during the on end of
related matters. cover only the Company or extend to the Group/ Joint
financial the financial Media
Ventures/ Suppliers/ Contractors/ NGOs/ Others?
year year The Company has a designated e-mail address for
The Company engages with media to update about the
1 Child labour/ forced NIL NIL grievances of shareholders. The Investor Relations Team Response - The Company upholds the principles of
developments in the Company. Regular interactions with
labour/ involuntary regularly engages with the shareholders to resolve queries, being an organisation that respects human rights, is
print, television and online media take place through
labour grievances, if any, and provides guidance to shareholders non-discriminatory in nature amongst employees and
press releases, media events and quarterly results
2 Sexual harassment NIL NIL for any Company-related matters. provides for a redressal mechanism towards the key
announcements. The Company also ensures timely and
personnel constituents that it deals with. Company’s
3 Discriminatory NIL NIL Statutory bodies appropriate responses to media for any information
Code of Conduct respects and promotes human rights.
employment requests within the stipulated disclosure norms.
The Company participates and engages with various The Company is committed to maintaining a safe business
8. What percentage of your above mentioned employees statutory authorities including governments, regulators 2. Out of the above, has the company identified the
environment and workplace for everyone, irrespective
were given safety & skill upgradation training in the last and legislators, both directly and indirectly, towards disadvantaged, vulnerable & marginalized stakeholders?
of the ethnicity, region, sexual orientation, race, caste,
year? legislative framework which may affect the Company’s
Response - The Company identifies communities gender, religion, disability, work, designation and other
business interests. parameters.
Response - surrounding its manufacturing facilities, with a focus on
Employee Engagement improving lives of people especially women and children.
(a) Permanent Employees - 100% The Company supports and respects the protection
The Company is committed towards proactively engaging
(b) Permanent Women Employees - 100% of internationally proclaimed human rights, labour
The Company believes that its employees are its key with all the employees, business associates, customers
standards and environmental protection measures. The
(c) Casual/Temporary/Contractual - 100% stakeholders. During the period under review, due to the and communities.
Anti- Sexual Harassment Policy is applicable to all the
Employees COVID-19 pandemic and social distancing norms with
The Company’s CSR activities focus on the disadvantaged, employees including contractual employees and also
(d) Employees with Disabilities - 100% many of offices/units where work from home was given,
vulnerable and marginalised segments of society and covers trainees, consultants, contractors and vendors.
physical employee programs were restricted however the
the Company undertakes various initiatives for their

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Parag Milk Foods Limited Wholesome living Corporate Overviews Statutory Reports Financial Statements

Business should respect and promote human rights continuously implementing process improvements to 7. In Cheese Plant: Replaced 1 X 4 Fixture T5 Response - Yes. All the factories file periodic statutory
reduce emissions and wastes. Climate action has been –55Watt with LED Light - 16 Watt.(Total 60Fixtures declarations with the pollution control boards on the
The Company seeks to uphold and promote human on our agenda and continues to form a significant part of replaced.) emissions and waste generated and they are within
rights in its operations, in relationships with business our ESG vision for the next decade as well. permissible limits granted by the pollution control
and partners through its human rights policy. Its policies 3. Does the company identify and assess potential board.
support, respect and protect the human rights of its The Company has always been committed to environmental risks?
direct as well as indirect employees. sustainable growth, which includes its responsibility We comply with all applicable environmental legislations
towards its customers as well as towards the Response - Yes. The Company follows sound environmental in the locations we operate from. All parameters as
The Company has adhered to the laws and guidelines on environment. Sustaining an equitable balance between management practices across all its manufacturing units defined by CPCB or SPCBs are monitored, tracked and
human rights as per the Constitution of India, National economic growth and environment preservation has to assess and address environmental risks. maintained within norms.
laws and Policies and treats all its stakeholders and always been a key focus area for the company. The
customers with dignity, respect and understanding. The company is certified for ISO14001 (Environment 7. Number of show cause/ legal notices received from
environment management approach has led to efficient
Management System), ISO50001 (Energy management CPCB/SPCB which are pending (i.e. not resolved to
and optimum utilization of available resources as well
In order to ensure no child labour in its operations, the System), ISO45001 (Occupational Health and Safety satisfaction) as on end of Financial Year.
as minimization of waste as a result of adoption of the
Company documents age proofs and PAN cards or Management System), and ISO22000 (Food Safety
latest technologies.
identical proof of all prospective candidates to be hired or Management System Response - The Company has not received any show
contracted. The Company ensures non-discrimination while Water, being the most important commodity in today’s cause/ legal notices either from CPCB or SPCB which is
communicating the job description through recruitment 4. Does the company have any project related to Clean pending as on March 31, 2021.
time, the Company has taken special care to recycle,
channels to give equal opportunity to all candidates Development Mechanism?
reuse and optimise the use of this natural resource.
irrespective of their caste, race, religion or gender. Principle 7: BUSINESSES WHEN ENGAGED IN INFLUENCING
Our Effluent treatment plant is Anaerobic with USB, and If so, provide details thereof, in about 50 words or so. PUBLIC AND REGULATORY POLICY, SHOULD DO SO IN A
has the capacity to handle liquid effluent of 2600CMD Also, if Yes, whether any environmental compliance
No material complaint related to violation of fundamental RESPONSIBLE MANNER
upto 5000mg /l and gives outlet of less than 150 mg/l report is filed?
human rights of individuals was received during the
COD. The sludge coming out of Effluent Treatment The Company’s approach to deal with the institutions engaged
financial year.
Process (ETP) is converted into manure by using Response - The Company adheres to all rules, regulations, in public advocacy is guided by the principles of Code of
2. How many stakeholder complaints have been received vermicomposting process and distributed to local standards framed by Central Pollution Control Board Business Conduct i.e., honesty, transparency, integrity and
in the past financial year and what percentage was farmers. The clean water from ETP is distributed by a (“CPCB”) and State Pollution Control Board (“SPCB”) accountability.
satisfactorily resolved by the management? network of pipelines to the farmers in the surrounding of respective states where the Company’s plants are
areas. The ETP plant also produces biogas, which situated. Compliances of these rules, regulations and The Company focuses on building excellence in manufacturing
Response - The Company has not received any complaint is redirected to generate electricity and is used for standards are being checked by internal auditors. food products, while interacting with key stakeholders.
regarding human rights violation. cooking at the staff canteen. The Company learns from the best practices of others and
The Company has not registered any projects under the collaborates with various trade and industry associations.
Principle 6: BUSINESSES SHOULD RESPECT, PROTECT, AND In line with the Company’s commitment towards Clean Development Mechanism.
MAKE EFFORTS TO RESTORE THE ENVIRONMENT conservation of energy, all its units continue with their 1. Is your company a member of any trade and chamber
5. Has the company undertaken any other initiatives on – or association? If Yes, Name only those major ones that
efforts to reduce wastage, optimise consumption and
1. Does the policy related to Principle 6 cover only the clean technology, energy efficiency, renewable energy, your business deals with.
also to improve energy efficiency through innovative
company or extends to the Group/Joint Ventures/ etc. Y/N. If yes, please give hyperlink for web page etc.
measures such as:
Suppliers/Contractors/NGOs/others. Yes, the Company is the Member of various trade and
At Manchar Plant Commissioning of 850KW Bio gas industrial associations like
1. Commissioning of 850KW Bio gas Engine for own
Response - Yes, the Company’s policy is extended to the Engine for own electricity generation and installation of
electricity generation.
entire group and its subsidiaries follow and adopt the Bio-gas generation at Bhagyalaxmi farm has been done a) Federation of Indian export organization (FIEO).
practices/policies of the Company. The Company ensures 2. Replacement of existing pneumatic ghee packing by the company
that it is implemented at all these levels and the Suppliers b) Confederation of Indian Industries (CII),
machine with mechanical packing machine with
/ Contractors / NGOs dealing with the Company are Response - The Company strives to adopt process
servo injection. New machine power consumption is c) Indian Dairy Association (IDA).
also encouraged to maintain ethical standards in all improvement measures and invest in efficient technologies
1.5KW, whereas Old machine consumed 5.0KW. Also
their practices. to reduce its impact on the environment. The company
new machine doesn’t require Compressed Air. 2. Have you advocated/lobbied through above
is committed to clean technology and transitioning to
associations for the advancement or improvement of
2. Does the company have strategies/ initiatives to address 3. Installed Variable frequency Drive (400KW) on renewable energy for its operations.
public good? Yes/No; if yes specify the broad areas (
global environmental issues such as climate change, various equipment’s at Lactose plant
The details of initiatives taken for conservation of energy drop box: Governance and Administration, Economic
global warming, etc? Y/N. If yes, please give hyperlink
are given in Annexure-IV to the Board’s Report and the Reforms, Inclusive Development Policies, Energy
for webpage etc. 4. Replacement of inefficient refrigeration system with
same is disclosed on the website of the Company. security, Water, Food Security, Sustainable Business
high performance equipments.
Response - The Company understands its responsibility Principles, Others
towards environment and has taken various initiatives to 5. Replacement of Old motors with high efficiency 6. Are the Emissions/Waste generated by the company
within the permissible limits given by CPCB/SPCB for The Company extends its support to various business
reduce its environmental impact. Energy conservation motors.
the financial year being reported? associations and supports / advocates on Industry
and use of clean fuels continue to be a priority area of
6. Installed sealing – cooling Water recirculation
the Company. Climate change, global warming and
arrangement for Lactose Evaporator plant.
environmental degradation pose unique challenges as
well as opportunities for the Company. The Company is

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Parag Milk Foods Limited Wholesome living Corporate Overviews Statutory Reports Financial Statements

related policies, export policies etc, whenever necessary, after execution of the CSR Project. We believe that the most trusted, valuable and popular brands among concerning health and safety impacts, marketing
keeping in view the interest of various stakeholders this community development initiative is successfully Indian consumers in various reputed surveys. communication, information and labelling.
adopted by the community since the same is about
Principle 8: INCLUSIVE GROWTH basic needs. The Company has been providing value to its consumers The Company always endeavours that its advertising
since years without any compromise and has put in and communications do not mislead or confuse the
The Company supports the principle of inclusive growth Social initiative for Ongoing pandemic COVID-19 as under: place effective consumer complaints redressal system. consumers or violate any of the principles regulating
and equitable development through its Corporate Social The Company discloses the necessary information on such matters. The Company adheres to the principles and
Responsibility initiatives and also through its core business. • 4000+ families are being supported by providing its products to promote consumer awareness, market its codes in the area of advertising and marketing developed
them with grocery packages at Manchar. products in responsible manner and exercise due care in by Advertising Standards Council of India (ASCI).
1. Does the company have specified programmes/
utilization of natural resources.
initiatives/ projects in pursuit of the policy related to • 250+ Grocery Kit to Panchayat Samiti Asha Workers 3. Is there any case filed by any stakeholder against the
Principle 8? If yes details thereof. in Ambegaon Taluka. A well-established system is in place for dealing with company regarding unfair trade practices, irresponsible
customer feedback and complaints. Customers are advertising and/or anti-competitive behaviour during the
Response - Our corporate social responsibility supports • Daily 500+ people at Covid Centre (Awasari & SDH
provided multiple options to connect with the Company last five years and pending as on end of financial year. If
inclusive growth not only of communities in the locations Manchar) are being provided with healthy meals
through email, telephone, website, social media, so, provide details thereof, in about 50 words or so.
where we operate, but also encompasses the overall prepared in the company canteen.
feedback forms, etc. All complaints are appropriately
development of societies and human capabilities. Response - The Company does not have any stakeholder
• Daily 100+ Government hospital staff at SDH addressed and all efforts are taken to resolve the same.
complaints with regard to unethical or unfair trade
The Company executes its CSR initiatives through various Manchar are being provided with food.
As on March 31, 2021, none of the customer complaints/ practices, irresponsible advertising and/or anti-
programs/ initiatives, the details of which are given in
• 5000+ poor families provided with Food at Manchar consumer cases beyond turnaround time (TAT) are competitive behaviour, which are pending as on March
Annexure - III - CSR Report forming part of the Board’s Report.
and nearby villages. pending. 31, 2021.
2. Are the programmes / projects undertaken through in-
• Donated 12000+ three-ply masks, 3000 hand 2. Does the company display product information on 4. Did your company carry out any consumer survey /
house team/own foundation/external NGO/government
sanitizers, 1000 hand gloves, to frontline staff in the product label, over and above what is mandated consumer satisfaction trends?
structures/any other organization?
hospitals and nearby Manchar villager. as per local laws? Yes/No/N.A. /Remarks(additional
information) Response - Yes, Consumer Satisfaction Surveys are
Response - Given in Annexure III to Directors Report.
• Sanitization of Manchar and nearby village. being conducted periodically to assess the consumer
3. Have you done any impact assessment of your initiative? Response - All Company products comply with the satisfaction levels and consumer’s trends.
• Donate 2000+ Covid N-95 Masks and 500+ sanitizer applicable acts and regulations such as the Drugs and
Response - The Company assesses the impact of the to public servants [FIRST LINE WARRIORS] in and Cosmetics Act, Legal Metrology Act, Bureau of Indian The Company continuously carries out consumer surveys
CSR Projects and Programs undertaken at its Board and around Palamaner Standards Specifications, Trademark Act and Copyright to understand consumer feedback, product satisfaction
CSR Committee meetings. An update on the CSR project Act, Food Safety and Standards Act, Regulations for Labels and preference while measuring consumer response and
• Trainings given to School children’s around Dairy satisfaction regularly through the Company’s continuous
and programs is placed at the Board and CSR Committee and Pack Information and Plastic Waste Management
related to Hygiene practices to combat Covid-19 and periodic tracking studies through a random sampling
meetings for their review and assessment. Rules, 2016.
approach among target consumers.
• Old animals’ (250 in number) nurturing at Panjarpol,
The Company takes cognizance of sub-rule (3) of rule The Company displays additional information on the
Manchar. As part of the consumer complaint handling process, the
8 of the Companies (Corporate Social Responsibility product label, over and above the mandated information
Policy) Amendment Rules, 2021, and details of impact e.g. product claims, storage directions etc. which varies Company carries out consumer satisfaction survey on
• The company has been conducting Free MS CIT
assessments will be provided in accordance with from from product to product. This additional information is monthly basis against certain defined attributes. Results
course to needy childrens’ at Manchar and villager
fiscal 2022. provided to keep the consumers aware. are shared with the stakeholders for necessary action to
school students ( 30 Students )
improve the process.
4. What is your company’s direct contribution to • At Palamaner RTO Office Gardening done and The Company is committed to building trust by disclosing
community development projects - Amount in INR and tree plantation done at surrounding villages ( new information truthfully and factually including cautionary
the details of the projects undertaken. ones 7000). statements and through transparent communication.

Response - The Company has spent Rs. 40.05 Million • R.O Water supply to nearby village people at Palamaner- The Company ensures that its products are safe and
as part of its CSR initiatives for FY 2020-21. Details of 10000 liters per day (Provided all 365 days). provides clear information on the safe and responsible
the projects are provided in Annexure-III - CSR Report usage of their products. The Company has been fully
forming part of Board’s Report. Principle 9: BUSINESSES SHOULD ENGAGE WITH AND compliant with products and service regulations
PROVIDE VALUE TO THEIR CUSTOMERS AND CONSUMERS
5. Have you taken steps to ensure that this community IN A RESPONSIBLE MANNER
development initiative is successfully adopted by the
community? Please explain in 50 words, or so. 1. What percentage of customer complaints/consumer
cases are pending as on the end of financial year?
Response - Yes. As a part of CSR we have initiated
various helps and assistance to needy people in vicinity Response - The Company’s commitment to provide
area of factories. We monitor to the extent possible world-class products to consumers has made it one of

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

INDEPENDENT AUDITOR’S REPORT

To the Members of Parag Milk Foods Limited Valuation of Trade Receivables • We have verified open invoices duly accepted by accordance with the provisions of the Act for safeguarding of
customers in order to ensure existence of trade the assets of the Company and for preventing and detecting
Report on the Audit of the Standalone Financial Statements (Refer to note 3(c)(i) ‘Accounting policy on Impairment of receivables; frauds and other irregularities; selection and application of
financial assets’, note 10 ‘Trade receivables’ and 36A ‘Financial appropriate accounting policies; making judgments and
Opinion Risk Management-Credit Risk’ to the standalone financial • We have verified the appropriateness of judgments estimates that are reasonable and prudent; and design,
statements) regarding provisions for trade receivables and implementation and maintenance of adequate internal
We have audited the standalone financial statements of Parag
assessment as to whether these provisions were financial controls, that were operating effectively for ensuring
Milk Foods Limited (the ‘Company’), which comprise the As at 31st March, 2021, the trade receivables balance excluding calculated in accordance with the Company’s the accuracy and completeness of the accounting records,
Balance Sheet as at 31st March, 2021, and the Statement of provisions included in note 10 were ` 2530.06 million. provisioning policies. relevant to the preparation and presentation of the standalone
Profit and Loss, the Statement of Changes in Equity and the
Statement of Cash Flows for the year then ended, and notes We have identified valuation of trade receivables as a key audit financial statements that give a true and fair view and are free
• We have conducted discussion with management
to the standalone financial statements, including a summary matter on account of the significant management judgment from material misstatement, whether due to fraud or error.
as to the recoverability of the old outstanding and
of the significant accounting policies and other explanatory involved with respect to the recoverability of trade receivables corroborating management’s explanations with In preparing the standalone financial statements, the Board
information. and the provisions for impairment of receivables, and the underlying documentation and correspondence of Directors is responsible for assessing the Company’s ability
importance of cash collection with reference to the working with the customers.
In our opinion and to the best of our information and according to continue as a going concern, disclosing, as applicable,
capital management of the business.
to the explanations given to us, the aforesaid standalone matters related to going concern and using the going concern
Our audit procedures did not reveal material variations.
financial statements give the information required by the Principal Audit Procedures basis of accounting unless the management either intends
Companies Act, 2013 (the ‘Act’) in the manner so required and Information Other than the Standalone Financial Statements to liquidate the Company or to cease operations, or has no
give a true and fair view in conformity with the accounting Our audit procedures included but were not limited to the and Auditor’s Report Thereon realistic alternative but to do so.
principles generally accepted in India, of the state of affairs of following:
The Company’s Board of Directors is responsible for the other Those Board of Directors are also responsible for overseeing
the Company as at 31st March, 2021, and its profit, changes in
a) Understanding the trade receivables process with information. The other information comprises the information the Company’s financial reporting process.
equity and its cash flows for the year ended on that date.
regards to valuation and evaluation of controls designed included in the Annual Report, but does not include the
and implemented by the management; Auditor’s Responsibilities for the Audit of the Standalone
Basis for Opinion standalone financial statements and our auditor’s report
Financial Statements
thereon.
We conducted our audit in accordance with the Standards b) Assessment of the appropriateness of the Company’s
credit risk policy and obtaining an understanding on Our objectives are to obtain reasonable assurance about
on Auditing (SAs) specified under Section 143(10) of the Our opinion on the standalone financial statements does not
management of credit risk; whether the standalone financial statements as a whole are
Act. Our responsibilities under those Standards are further cover the other information and we do not express any form of
free from material misstatement, whether due to fraud or
described in the Auditor’s Responsibilities for the Audit of the assurance conclusion thereon.
c) Control testing: error, and to issue an auditor’s report that includes our opinion.
Standalone Financial Statements section of our report. We are
In connection with our audit of the standalone financial Reasonable assurance is a high level of assurance, but is not
independent of the Company in accordance with the Code • Obtaining an understanding on credit approvals,
statements, our responsibility is to read the other information a guarantee that an audit conducted in accordance with SAs
of Ethics issued by the Institute of Chartered Accountants of establishing credit limits and continuous monitoring
and, in doing so, consider whether the other information is will always detect a material misstatement when it exists.
India (ICAI) together with ethical requirements that are relevant of creditworthiness of customers to which the
materially inconsistent with the standalone financial statements Misstatements can arise from fraud or error and are considered
to our audit of the standalone financial statements under the Company grants the credit in normal course of
or our knowledge obtained in the audit or otherwise appears material if, individually or in aggregate, they could reasonably
provisions of the Act and the Rules thereunder, and we have business
to be materially misstated. If, based on the work we have be expected to influence the economic decisions of users
fulfilled our other ethical responsibilities in accordance with
• Obtaining understanding on how the Company performed, we conclude that there is a material misstatement taken on the basis of these standalone financial statements.
these requirements and the Code of Ethics. We believe that the
audit evidence we have obtained is sufficient and appropriate establishes an allowance for doubtful debts and of this other information, we are required to report that fact.
As part of an audit in accordance with SAs, we exercise
to provide a basis for our opinion. impairment that represents its estimate of incurred We have nothing to report in this regard.
professional judgment and maintain professional skepticism
losses in respect of trade receivables.
Responsibilities of Management and Those Charged with throughout the audit. We also:
Key Audit Matters
d) Tests of details: Governance for the Standalone Financial Statements
• Identify and assess the risks of material misstatement of
Key audit matters are those matters that, in our professional
• We have checked the ageing analysis, on a The Company’s Board of Directors is responsible for the the financial statements, whether due to fraud or error,
judgement, were of most significance in our audit of the
sample basis and subsequent receipt of the trade matters stated in Section 134(5) of the Act, with respect to design and perform audit procedures responsive to
standalone financial statements of the current year. These
receivables, to the source documents, including the preparation of these standalone financial statements that those risks, and obtain audit evidence that is sufficient
matters were addressed in the context of our audit of the
bank statements; give a true and fair view of the financial position, financial and appropriate to provide a basis for our opinion. The
standalone financial statements as a whole, and in forming our
performance, changes in equity and cash flows of the Company risk of not detecting a material misstatement resulting
opinion thereon, and we do not provide a separate opinion on
• We have verified the underlying supporting in accordance with the accounting principles generally from fraud is higher than for one resulting from error,
these matters.
documents like acceptance of invoices along accepted in India, including the Indian Accounting Standards as fraud may involve collusion, forgery, intentional
We have determined the matters described below to be the with various correspondence carried out by the specified under Section 133 of the Act. This responsibility omissions, misrepresentations, or the override of
key audit matters to be communicated in our report. management of the Company with trade receivable also includes maintenance of adequate accounting records in internal control;
for realization of money;

132 133
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

• Obtain an understanding of internal control relevant We describe these matters in our auditor’s report unless law (f) with respect to the adequacy of the internal financial standalone financial statements - (Refer Note
to the audit in order to design audit procedures that or regulation precludes public disclosure about the matter or controls over financial reporting of the Company 40 to the standalone financial statements);
are appropriate in the circumstances. Under Section when, in extremely rare circumstances, we determine that a and the operating effectiveness of such controls,
143(3)(i) of the Act, we are also responsible for matter should not be communicated in our report because refer to our separate Report in Annexure ‘B’; (2) the Company did not have any long-term
expressing our opinion on whether the Company has the adverse consequences of doing so would reasonably be contracts including derivative contracts for
adequate internal financial controls system in place expected to outweigh the public interest benefits of such (g) with respect to the other matters to be included which there were any material foreseeable
and the operating effectiveness of such controls; communication. in the Auditors Report in accordance with the losses; and
requirements of Section 197(16) of the Act, as
• Evaluate the appropriateness of accounting policies Other Matter amended, in our opinion and to the best of our (3) there were no amounts which were required to
used and the reasonableness of accounting estimates information and according to the explanations given be transferred to the Investor Education and
and related disclosures made by management; We draw attention to Note 48 to the accompanying Standalone to us, the remuneration paid by the Company to its Protection Fund by the Company.
Financial Statements which explains the uncertainties and directors is in accordance with the provisions of
• Conclude on the appropriateness of management’s the Management’s evaluation of the financial impact on the SHARP & TANNAN
Section 197 of the Act; and
use of the going concern basis of accounting and, Company due to lockdown and other restrictions imposed Chartered Accountants
based on the audit evidence obtained, whether on account of COVID-19 pandemic situation, for which a (h) with respect to the other matters to be included in Firm’s Registration No.109982W
a material uncertainty exists related to events or definitive assessment of the impact is highly dependent upon the Auditor’s Report in accordance with Rule 11 of by the hand of
conditions that may cast significant doubt on the the circumstances as they evolve in the subsequent period. the Companies (Audit and Auditors) Rules, 2014, in
Company’s ability to continue as a going concern. our opinion and to the best of our information and
If we conclude that a material uncertainty exists, Our opinion is not modified in respect of this matter. according to the explanations given to us: Edwin P. Augustine
we are required to draw attention in our auditor’s Partner
Report on Other Legal and Regulatory Requirements (1) the Company has disclosed the impact of Membership No. 043385
report to the related disclosures in the standalone
financial statements or, if such disclosures are pending litigations on its financial position in its Mumbai, 12th June, 2021 UDIN: 21043385AAAAEA7941
1. As required by the Companies (Auditor’s Report) Order,
inadequate, to modify our opinion. Our conclusions 2016 (the ‘Order’), issued by the Central Government of
are based on the audit evidence obtained up to the India in terms of Section 143(11) of the Act, we give in the
date of our auditor’s report. However, future events Annexure ‘A’, a Statement on the matters specified in
or conditions may cause the Company to cease to paragraphs 3 and 4 of the Order, to the extent applicable.
continue as a going concern; and
2. As required by Section 143(3) of the Act, we report that:
• Evaluate the overall presentation, structure and
content of the financial statements, including the (a) we have sought and obtained all the information and
disclosures, and whether the standalone financial explanations which to the best of our knowledge and
statements represent the underlying transactions belief were necessary for the purposes of our audit;
and events in a manner that achieves fair
(b) in our opinion, proper books of account as required
presentation.
by law have been kept by the Company so far as it
We communicate with those charged with governance appears from our examination of those books;
regarding, among other matters, the planned scope and
(c) the Balance Sheet, the Statement of Profit and
timing of the audit and significant audit findings, including
Loss, the Statement of Changes in Equity and the
any significant deficiencies in internal control that we identify
Statement of Cash Flows dealt with by this Report
during our audit.
are in agreement with the books of account;
We also provide those charged with governance with a
(d) in our opinion, the aforesaid standalone financial
statement that we have complied with relevant ethical
statements comply with the Indian Accounting
requirements regarding independence, and to communicate
Standards specified under Section 133 of the Act;
with them all relationships and other matters that may
reasonably be thought to bear on our independence, and (e) on the basis of the written representations received
where applicable, related safeguards. from the directors as on 31st March, 2021 taken
on record by the Board of Directors, none of the
From the matters communicated with those charged with
directors is disqualified as on 31st March, 2021 from
governance, we determine those matters that were of most
being appointed as a director in terms of Section
significance in the audit of the standalone financial statements
164 (2) of the Act;
of the current period and are therefore the key audit matters.

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

ANNEXURE ‘A’ TO THE INDEPENDENT AUDITOR’S REPORT

(Referred to in paragraph 1 of our report of even date)

(i) (a) The Company has maintained proper records the Reserve Bank of India and the provisions of Sections Name of the Statute Nature of the Amount Period to which Forum where disputes are Pending
showing full particulars, including quantitative 73 to 76 and other relevant provisions of the Act and the disputed dues (` Million)* the amount
details and situation of fixed assets, (Property, plant rules framed thereunder apply. relates
and equipment), except for certain fixed assets, The Central Goods and Tax, Interest and 7.85 FY 2017-18 Commissioner of GST and Central
where the quantitative details are not available since (vi) The maintenance of cost records has been specified
Service Tax Act, 2017 Penalty Excise
the inception. by the Central Government under Section 148(1)
59.70 July, 2017 to GST Officer
of the Act. We have broadly reviewed the cost
March, 2020
(b) During the year, the fixed assets of the Company have records maintained by the Company pursuant to the
been physically verified by the management, except Companies (Cost Records and Audit) Rules, 2014, Central Sales Tax Act, 1956 Tax, Interest and 6.50 FY 2017-18 Commissioner of Sales Tax
as stated in paragraph (a) above, and no material as amended, prescribed by the Central Government Penalty 20.25 FY 2009-10 Joint Commissioner of Sales Tax
discrepancies were noticed on such verification. under Section 148(1) of the Act and are of the opinion (App)-1
In our opinion, the frequency of verification is that prima facie, the prescribed accounts and records 2.15 FY 2016-17 --do--
reasonable having regard to the size of the Company have been made and maintained. We have, however, The Maharashtra Value Tax, Interest and 37.90 FY 2009-10 Joint Commissioner of Sales Tax
and the nature of its assets. not made a detailed examination of these accounts Added Tax Act, 2002 Penalty (App)-1
and records with a view to determine whether they 0.55 FY 2010-11 --do--
(c) The title deeds of immovable properties recorded are accurate or complete. 2.55 FY 2016-17 --do--
as property, plant and equipment in the books of
account of the Company are held in the name of the (vii) (a) According to the information and explanations (*net of pre-deposit paid in getting the stay / appeal admitted)
Company. given to us, the Company is generally regular in (viii) According to the information and explanations given to are in compliance with Sections 177 and 188 of the
depositing undisputed statutory dues including us, the Company has not defaulted in repayment of loans Act, where applicable. The relevant details of such
(ii) As explained to us, inventories, except goods-in-transit provident fund, employees’ state insurance, income or borrowings to financial institutions and banks. The related party transactions have been disclosed in the
and stocks lying with third parties have been physically tax, duty of customs, goods and services tax, cess Company has not taken any loans or borrowings from the standalone financial statements, etc., as required under
verified by the management during the year. In our and any other statutory dues, where applicable, to Government and has not issued debentures. Indian Accounting Standard (Ind AS) 24, Related Party
opinion, the frequency of such verification is reasonable. the appropriate authorities, except an amount of Disclosures specified under Section 133 of the Act.
No material discrepancies were noticed on verification ` 0.92 million pertaining to income tax deducted at (ix) According to the information and explanations given
between the physical stocks and the book records. source for the month of January, 2021, which has not to us, the Company has not raised monies by way of (xiv) According to the information and explanations given to
been paid till the date of our report. initial public offer or further public offer (including us, the Company had not made any preferential allotment
(iii) According to the information and explanations give to us,
debt instruments). In our opinion and according to the or private placement of shares or fully or partly convertible
the Company has not granted loans, secured or unsecured According to the information and explanations given information and explanations given to us, on an overall debentures during the year. Accordingly, the Paragraph
to companies, firms, limited liability partnerships or other to us, there are no arrears of outstanding statutory basis, the term loan has been applied for the purpose for 3(xiv) of the Order is not applicable to the Company.
parties covered in the register maintained under Section dues as at the last day of the financial year for a which the term loan was obtained.
189 of the Act. Accordingly, the Paragraph 3(iii) of the period of more than six months from the date they (xv) According to the information and explanations given
Order is not applicable to the Company. became payable. (x) During the course of our examination of the books and to us, the Company has not entered into any non-cash
records of the Company, carried out in accordance transactions with directors or persons connected with
(iv) According to the information and explanations given to (b) According to the information and explanations with generally accepted auditing practices in India, and him during the year. Accordingly, the Paragraph 3 (xv) of
us, the Company has complied with the provisions of given to us and the records examined by us, the according to the information and explanations given the Order is not applicable to the Company.
Sections 185 and 186 of the Act in respect of grant of particulars of income tax, wealth tax, sales tax, to us, we have neither come across any fraud by the
loans, making investments and providing guarantees and service tax, value added tax, goods and service (xvi) According to the information and explanations given to
Company or any fraud on the Company by its officers or
securities, as applicable. tax as at 31st March, 2021 which have not been us, the Company is not required to be registered under
employees noticed or reported during the year nor have
deposited on account of a dispute pending, are as we been informed of such case by management. Section 45-IA of the Reserve Bank of India Act, 1934.
(v) The Company has not accepted any deposits from the
under:
public during the year to which the directives issued by SHARP & TANNAN
(xi) According to the information and explanations given to us,
the managerial remuneration has been paid / provided in Chartered Accountants
Name of the Statute Nature of the Amount Period to which Forum where disputes are Pending Firm’s Registration No.109982W
accordance with the requisite approvals mandated by the
disputed dues (` Million)* the amount by the hand of
provisions of Section 197 read with Schedule V to the Act.
relates
The Income Tax Act, 1961 Tax, Interest and 1.89 AY 2013-14 Appeal filed with ITAT (xii) According to the information and explanations given to
Penalty 11.96 AY 2016-17 Appeal filed with CIT(A) us, the Company is not a Nidhi company. Accordingly,
Edwin P. Augustine
22.44 AY 2018-19 --do-- the Paragraph 3(xii) of the Order is not applicable to the
Partner
2.45 AY 2019-20 --do-- Company.
Membership No. 043385
Wealth Tax Act, 1957 Tax, Interest and 0.08 AY 2014-15 Responded on IT Portal
(xiii) According to the information and explanations given Mumbai, 12th June, 2021 UDIN: 21043385AAAAEA7941
Penalty
to us, all the transactions with the related parties

136 137
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

ANNEXURE ‘B’ TO THE INDEPENDENT AUDITOR’S REPORT

(Referred to in paragraph 2(f) of our report of even date)

Report on the Internal Financial Controls under Section and maintained and if such controls operated effectively in Inherent Limitations of Internal Financial Controls Over financial reporting and such internal financial controls over
143(3)(i) of the Companies Act, 2013 (the ‘Act’) all material respects. Financial Reporting financial reporting were operating effectively as of 31st March,
2021, based on the internal control over financial reporting
We have audited the internal financial controls over financial Our audit involves performing procedures to obtain audit Because of the inherent limitations of internal financial criteria established by the Company considering the essential
reporting of Parag Milk Foods Limited (the ‘Company’) as of evidence about the adequacy of the internal financial controls over financial reporting, including the possibility components of internal control stated in the Guidance Note
31st March, 2021 in conjunction with our audit of the standalone controls system over financial reporting and their operating of collusion or improper management override of controls, issued by the ICAI.
financial statements of the Company for the year ended on effectiveness. Our audit of internal financial controls over material misstatements due to error or fraud may occur and
that date. financial reporting included obtaining an understanding of not be detected. Also, projections of any evaluation of the SHARP & TANNAN
internal financial controls over financial reporting, assessing internal financial controls over financial reporting to future Chartered Accountants
Management’s Responsibility for Internal Financial Controls the risk that a material weakness exists, and testing and periods are subject to the risk that the internal financial control Firm’s Registration No.109982W
evaluating the design and operating effectiveness of internal over financial reporting may become inadequate because of by the hand of
The Company’s management is responsible for establishing
control based on the assessed risk. The procedures selected changes in conditions, or that the degree of compliance with
and maintaining internal financial controls based on the
depend on the auditor’s judgement, including the assessment the policies or procedures may deteriorate.
internal control over financial reporting criteria established
of the risks of material misstatement of the standalone financial
by the Company considering the essential components Opinion Edwin P. Augustine
statements, whether due to fraud or error.
of internal control stated in the Guidance Note on Audit Partner
of Internal Financial Controls Over Financial Reporting We believe that the audit evidence we have obtained is In our opinion, to the best of our information and according to Membership No. 043385
(the ‘Guidance Note’) issued by the Institute of Chartered sufficient and appropriate to provide a basis for our audit the explanations given to us, the Company has, in all material Mumbai, 12th June, 2021 UDIN: 21043385AAAAEA7941
Accountants of India (ICAI). These responsibilities include opinion on the Company’s internal financial controls system respects, an adequate internal financial controls system over
the design, implementation and maintenance of adequate over financial reporting.
internal financial controls that were operating effectively for
ensuring the orderly and efficient conduct of its business, Meaning of Internal Financial Controls Over Financial Reporting
including adherence to company’s policies, the safeguarding
of its assets, the prevention and detection of frauds and errors, A company’s internal financial control over financial reporting is
the accuracy and completeness of the accounting records, a process designed to provide reasonable assurance regarding
and the timely preparation of reliable financial information, as the reliability of financial reporting and the preparation of
required under the Act. standalone financial statements for external purposes in
accordance with generally accepted accounting principles.
Auditor’s Responsibility A company’s internal financial control over financial reporting
includes those policies and procedures that: (1) pertain to the
Our responsibility is to express an opinion on the Company’s maintenance of records that, in reasonable detail, accurately and
internal financial controls over financial reporting based on fairly reflect the transactions and dispositions of the assets of the
our audit. We conducted our audit in accordance with the company; (2) provide reasonable assurance that transactions
Guidance Note and the Standards on Auditing, issued by ICAI are recorded as necessary to permit preparation of standalone
and deemed to be prescribed under Section 143(10) of the financial statements in accordance with generally accepted
Act, to the extent applicable to an audit of internal financial accounting principles, and that receipts and expenditures
controls, both applicable to an audit of Internal Financial of the company are being made only in accordance with
Controls and, both issued by the ICAI. Those Standards authorisations of management and directors of the company;
and the Guidance Note require that we comply with ethical and (3) provide reasonable assurance regarding prevention or
requirements and plan and perform the audit to obtain timely detection of unauthorised acquisition, use, or disposition
reasonable assurance about whether adequate internal of the company’s assets that could have a material effect on the
financial controls over financial reporting was established standalone financial statements.

138 139
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Standalone Balance Sheet Standalone Statement of Profit and Loss

as at 31st March, 2021 for the year ended 31st March, 2021

` million ` million
Particulars Notes As at As at Particulars Notes 2020-21 2019-20
31st March, 2021 31st March, 2020 Income
ASSETS Revenue from operations 25 17,917.35 23,912.77
Non-current assets
Property, plant and equipment 4 3,787.68 3,957.37 Other income 26 68.24 29.19
Capital work-in-progress 9.34 66.82 Total Income 17,985.59 23,941.96
Other intangible assets 5 19.27 26.30
Financial assets Expenses
Investments 6 630.84 628.16 Cost of materials consumed 27 13,006.14 17,534.45
Others 7 120.71 120.96
Deferred tax assets (net) 34 54.19 122.68 Purchases of Stock-in-trade 28 975.31 2,220.30
Other non-current assets 8 23.66 75.14 Changes in inventories of finished goods, stock-in-trade and work-in-progress 29 (580.76) (1,824.27)
Total Non-current assets 4,645.69 4,997.43
Current assets Employee benefits expense 30 753.27 930.53
Inventories 9 6,873.32 6,268.27 Finance costs 31 455.18 380.41
Financial assets
Trade receivables 10 1,559.15 2,994.85 Depreciation and amortisation expense 32 493.76 513.75
Cash and cash equivalents 11 65.34 213.15 Other expenses 33 2,496.02 2,934.67
Bank balances (other than above) 12 117.06 54.55
Other current assets 13 3,120.36 2,118.16 Total Expenses 17,598.92 22,689.84
Current tax Assets (net) 14 1.33 - Profit before tax 386.67 1,252.12
Total Current Assets 11,736.56 11,648.98
Total Assets 16,382.25 16,646.41 Tax expense 34
EQUITY AND LIABILITIES Current tax 61.12 293.13
Equity
Equity share capital 15 839.39 839.39 MAT (credit)/reversal - 35.38
Other equity 16 8,358.74 8,221.53 Deferred tax 70.41 17.23
Total Equity 9,198.13 9,060.92
Liabilities Tax adjustment in respect of ealier years 80.60 -
Non-current liabilities Profit for the year 174.54 906.38
Financial liabilities
Borrowings 17 208.63 481.48 Other comprehensive income 34
Other financial liabilities 18 84.04 109.75 Items that will not be reclassified to profit or loss
Provisions 19 40.04 43.36
Total Non-current liabilities 332.71 634.59 Remeasurements of the defined benefit plans 7.63 5.54
Current liabilities Income tax on above (1.92) (1.93)
Financial liabilities
Borrowings 20 3,125.60 3,167.10 Other comprehensive income for the year, net of tax 5.71 3.61
Trade payables 21 Total Comprehensive income for the year 180.25 909.99
(A) total outstanding dues of micro and small enterprises 8.97 25.03
(B) total outstanding dues of creditors other than micro and small enterprises. 2,879.10 2,789.26 Earnings per equity share of face value of ` 10 each: 42
Other financial liabilities 22 622.44 795.42
Other current liabilities 23 210.86 93.04 Basic earnings per share (in `) 2.08 10.80
Provisions 19 4.44 4.21 Diluted earnings per share (in `) 2.08 10.78
Current tax liabilities (net) 24 - 76.84
Total Current liabilities 6,851.41 6,950.90
Total Liabilities 7,184.12 7,585.49 Significant Accounting Policies 3
Total Equity and Liabilities 16,382.25 16,646.41
Other Notes 4 to 49
Significant Accounting Policies 3 The accompanying notes form an integral part of the standalone financial statements.
Contingent Liabilities and Commitments 40
Other Notes 4 to 49
The accompanying notes form an integral part of the standalone financial statements. As per our report attached
SHARP & TANNAN For and on behalf of the Board of Directors
As per our report attached Chartered Accountants
SHARP & TANNAN For and on behalf of the Board of Directors Firm’s Registration No. 109982W
Chartered Accountants by the hand of
Firm’s Registration No. 109982W
by the hand of
Edwin P. Augustine Devendra Shah Pritam Shah
Edwin P. Augustine Devendra Shah Pritam Shah Partner Chairman Managing Director
Partner Chairman Managing Director Membership No. 043385 DIN: 01127319 DIN: 01127247
Membership No. 043385 DIN: 01127319 DIN: 01127247

Shashikant Dalmia Rachana Sanganeria Shashikant Dalmia Rachana Sanganeria

Chief Financial Officer Company Secretary & Compliance Officer Chief Financial Officer Company Secretary & Compliance Officer
Membership No. ACS10280 Membership No. ACS10280
Place: Mumbai Place: Manchar Place: Mumbai Place: Manchar
Date: 12th June, 2021 Date: 12th June, 2021 Date: 12th June, 2021 Date: 12th June, 2021

140 141
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Standalone Statement of changes in equity Standalone Statement of Cash Flows

for the year ended 31st March, 2021 for the year ended 31st March, 2021

` million ` million
Equity share capital (refer note 15) Particulars 2020-21 2019-20
A. Cash flows from operating activities
Particulars As at31 March, 2021
st
As at31 March, 2020
st

Profit before tax 386.67 1,252.12

No. of shares ` million No. of shares ` million
Depreciation and amortisation expense 493.76 513.75
Balance at the beginning of the reporting period (no. of shares 8,39,38,567 839.39 8,39,38,567 839.39 Allowance for doubtful debts and advances (net of recoveries/reversals) 126.89 95.10
8,39,38,567)
Net (gain) / loss on sale/ fair valuation of investments (6.07) 6.25
Change during the year (refer note 45) - -
ESOS expense (0.98) 3.38
Balance at the end of the reporting period 8,39,38,567 839.39 8,39,38,567 839.39
Finance costs 455.18 380.41
Sundry balances written-back (24.78) (5.58)
Other equity ` million Interest income (20.46) (25.08)
Particulars Reserves and Surplus Other Total Other Operating profit before working capital changes 1,410.21 2,220.35
Securities General Employee Retained Comprehensive Equity Adjustments for :
Premium Reserve Stock Options Earnings Income (Increase) / decrease in inventories (605.05) (1,790.82)
Reserve Outstanding (Remeasurement
in defined benefit (Increase)/Decrease in trade and other receivables 302.75 (731.02)
plans) (Decrease) / Increase in trade and other payables 111.53 (74.76)
Balance as at 1st April, 2019 4,447.85 59.26 4.89 2,908.73 (9.10) 7,411.63 Increase / (decrease) in provisions 4.53 0.20
Profit for the year - - - 906.38 - 906.38 Cash generated from operations 1,223.97 (376.05)
Other comprehensive income for the year (net of - - - - 3.61 3.61
Taxes paid (net of refunds) (219.89) (351.25)
tax)
Deferred Employee Compensation Expense - - 3.38 - - 3.38 Net cash flows from operating activities 1,004.08 (727.30)
IND AS 116, Leases, impact - - - (2.07) - (2.07) B. Cash Flows from Investing Activities
Dividend paid - - - (84.11) - (84.11) Purchase of Property, plant and equipment (296.45) (250.58)
Tax on dividend - - - (17.29) - (17.29) Purchase of intangible assets (8.85) (11.50)
Balance as at 31st March, 2020 4,447.85 59.26 8.27 3,711.64 (5.49) 8,221.53 Maturity / (Investment) of fixed deposits (63.24) 2.10
Profit for the year - - - 174.54 - 174.54 Investment in mutual funds (2.68) (0.01)
Other comprehensive income for the year (net of - - - - 5.71 5.71
tax)
Interest received 27.94 17.79
Deferred Employee Compensation Expense - - (0.98) - - (0.98) Net cash used in investing activities (343.28) (242.20)
Dividend paid - - - (42.06) - (42.06) C. Cash Flows from Financing Activities
Balance as at 31st March, 2021 4,447.85 59.26 7.29 3,844.12 0.22 8,358.74 Proceeds from long-term borrowings - 73.65
Proceeds / (repayment) short-term borrowings (net) (41.50) 1,723.28
As per our report attached
Repayment of long-term borrowings (268.41) (197.35)
SHARP & TANNAN For and on behalf of the Board of Directors Payment of dividend including dividend distribution tax (42.06) (101.40)
Chartered Accountants
Interest paid (456.64) (383.22)
Firm’s Registration No. 109982W
by the hand of Net cash flows from/ (used in) financing activities (808.61) 1,114.96
Net increase/ (decrease) in cash and cash equivalents (A+B+C) (147.81) 145.46
Cash and cash equivalents at the beginning of the year 213.15 67.69
Edwin P. Augustine Devendra Shah Pritam Shah
Cash and cash equivalents at the end of the year 65.34 213.15
Partner Chairman Managing Director
Membership No. 043385 DIN: 01127319 DIN: 01127247 ` million
Particulars 2020-21 2019-20
Shashikant Dalmia Rachana Sanganeria Cash and cash equivalents include:
Chief Financial Officer Company Secretary & Compliance Officer Balance with bank 41.70 198.70
Membership No. ACS10280 Cash on hand 23.64 14.45
Place: Mumbai Place: Manchar Total 65.34 213.15
Date: 12th June, 2021 Date: 12th June, 2021
Notes:

(a) The above Statement of Cash Flows has been prepared under the ‘Indirect Method’ as set out in the Indian Accounting
Standard (Ind AS) 7, Statement of Cash Flows as specified in the Companies (Indian Accounting Standards) Rules, 2015, as
amended from time to time.

142 143
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Standalone Statement of Cash Flows Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

(b) Additions to property, plant and equipment include movements of capital work-in-progress during the year. 1. Corporate information Items Measurement Basis
Certain financial assets Fair value
(c) Non cash movement in borrowings include addition/deletion on account of unrealised foreign exchange loss/(gain) of ` 4.55 Parag Milk Foods Limited (formerly Parag Milk Foods
and liabilities
million (31st March, 2020: ` 30.04 million) in respect of foreign currency loan. Private Limited) (“the Company”) was incorporated
Shared-based payments Fair value
under the provisions of the Companies Act, 1956 and its
(d) The net profit / loss arising due to conversion of current assets / current liabilities, receivable / payable in foreign currency is equity shares are listed on the National Stock Exchange Net defined benefit Present value of defined
furnished under the head, ‘Exchange Fluctuation (net)’. (NSE) and Bombay Stock Exchange (BSE) in India. The (asset)/ liability benefit obligation less Fair
Company is engaged in the business of procurement value of plan assets
(e) Movement of cow milk mainly in western and southern region,
` million D. Current / non-current classification of assets/liabilities
undertakes processing of milk and manufacture of
Particulars Opening Cash Foreign Fair value Others Closing various value added products namely cheese, butter, The Company has classified all its assets/liabilities into
Balance movement exchange changes Balance ghee, fresh cream, milk powder, flavoured milk, lassi, current/non-current portion based on the time frame
changes curd etc. which are marketed under its registered brand of 12 months from the date of the financial statements.
Long-term borrowing (Gross) 783.76 (281.32) 4.55 3.82 - 510.81 name “Gowardhan”, “Go”, “Topp up” and “Avvatar”. The Accordingly, assets/liabilities expected to be realised
registered office of the Company is situated at Flat No. /settled within 12 months from the date of financial
Short-term borrowing (net) 3,167.10 (41.50) - - - 3,125.60
1, Plot No. 19, Nav Rajasthan Society, S. B. Road, Shivaji statements are classified as current and other assets/
Total 3,950.86 (322.82) 4.55 3.82 - 3,636.41 Nagar, Pune- 411016. liabilities are classified as non-current
(f) Figures for the previous year have been regrouped wherever necessary. 2. Basis of preparation E. Use of estimates and judgements
The accompanying notes form an integral part of the standalone financial statements. A. Statement of compliance In the preparation of the financial statements,
the Company makes judgements, estimates and
As per our report attached The financial statements of the Company have been
assumptions about the carrying amount of assets
prepared in accordance with Indian Accounting
SHARP & TANNAN For and on behalf of the Board of Directors and liabilities that are not readily apparent from other
Standards (Ind AS) as per the Companies (Indian
Chartered Accountants sources. The estimates and associated assumptions are
Accounting Standards) Rules, 2015 notified under Section
Firm’s Registration No. 109982W based on historical experience and other factors that are
133 of Companies Act, 2013, (the ‘Act’) and other relevant
by the hand of considered to be relevant. Actual results may differ from
provisions of the Act.
these estimates.
The financial statements up to and for the year ended
Edwin P. Augustine Devendra Shah Pritam Shah Estimates and underlying assumptions are reviewed on
31st March 2017 were prepared in accordance with the
Partner Chairman Managing Director an ongoing basis. Revisions to accounting estimates are
Membership No. 043385 DIN: 01127319 DIN: 01127247 Companies (Accounting Standards) Rules, 2006, notified
recognised prospectively. Information about assumptions,
under Section 133 of the Act and other relevant provisions
judgements and estimation uncertainties that have a
of the Act.
significant risk of resulting in a material adjustment in the
Shashikant Dalmia Rachana Sanganeria year ending 31st March 2021 are as below and also been
The standalone financial statements were authorised for
Chief Financial Officer Company Secretary & Compliance Officer discussed in detail in the relevant section of accounting
issue by the Company’s Board of Directors on 12th June, 2021.
Membership No. ACS10280 policies.
Place: Mumbai Place: Manchar Details of the Company’s accounting policies are included
Date: 12th June, 2021 Date: 12th June, 2021 in Note 3. • Measurement of defined benefit obligations: key
actuarial assumptions;
B. Functional and presentation currency
• Useful life of property, plant and equipment
These standalone financial statements are presented in
Indian Rupees (`), which is also the Company’s functional • Fair value measurement of financial instruments
currency. All amounts have been rounded-off to two
• Impairment of financial assets.
decimal places to the nearest millions, unless otherwise
indicated. F. Measurement of fair values
C. Basis of measurement Certain accounting policies and disclosures of the
Company require the measurement of fair values, for
The standalone financial statements have been prepared
both financial and non-financial assets and liabilities.
on the historical cost basis except for the following items:

144 145
 Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

Fair values are categorised into different levels in a fair Any gain or loss on disposal of an item of property, plant iii. Amortisation the estimates used to determine the recoverable amount.
value hierarchy based on the inputs used in the valuation and equipment is recognised in statement of profit or The carrying amount of the asset is increased to its
techniques as follows: loss. Amortisation is recognised in profit or loss on a straight revised recoverable amount, provided that this amount
line basis over the estimated useful lives of the intangible does not exceed the carrying amount that would have
• Level 1: quoted prices (unadjusted) in active markets ii. Subsequent expenditure assets from the date that they are available for use. The been determined (net of any accumulated amortisation
for identical assets or liabilities. estimated useful lives are as follows: or depreciation) had no impairment loss been recognised
Subsequent expenditure is capitalised only if it is probable
for the asset in prior years.
• Level 2: inputs other than quoted prices included in that the future economic benefits associated with the Assets Useful life (years)
Level 1 that are observable for the asset or liability, expenditure will flow to the Company. d) Leases
either directly (i.e. as prices) or indirectly (i.e. derived Trade Marks 10
from prices). iii. Depreciation Computer Software 3 The Company has implemented the Ind AS 116 “Leases”
as notified by the Ministry of Corporate Affairs on 30th
• Level 3: inputs for the asset or liability that are not Depreciation on cost of fixed assets is provided on Amortisation method, useful lives and residual values are March 2019 through the Companies (Indian Accounting
based on observable market data (unobservable straight line method at estimated useful life, which is in reviewed at the end of each financial year and adjusted if Standards) Amendment Rules, 2019.
inputs). line with the estimated useful life as specified in Schedule appropriate.
II of the Companies Act, 2013, except for Second hand Effective 1st April, 2019, the Company has adopted Ind AS
When measuring the fair value of an asset or a liability, the machineries which are depreciated over an estimated c) Impairment 116 “Leases”, applied to all the lease contracts existing on
Company uses observable market data as far as possible. If the useful life of 10 years based on management estimate. 1st April, 2019 using the modified retrospective method of
inputs used to measure the fair value of an asset or a liability i. Financial assets transition. Accordingly, comparatives for the year ended
fall into a different levels of the fair value hierarchy, then the Depreciation on additions is provided on a prorata basis
31st March, 2019 have not been retrospectively adjusted.
fair value measurement is categorised in its entirety in the from the date of ready to use and in case of Projects from The Company recognises loss allowances using the
The Company’s lease asset classes primarily consist of
same level of the fair value hierarchy as the lowest level input the date of commencement of commercial production. expected credit loss (ECL) model for the financial
leases of land, building and equipment.
that is significant to the entire measurement. Depreciation on deductions/disposals is provided on a assets which are not fair valued through profit or loss.
pro-rata basis upto the month proceeding the month of Loss allowance for trade receivables with no significant At the date of commencement of lease, the Company
Further information about the assumptions made in the deduction/disposal. financing component is measured at an amount equal recognise a right-of-use asset (“ROU”) and a
measuring fair values is included in the following notes: to lifetime ECL with simplified approach. For all other corresponding lease liability for all lease arrangements in
The residual values, useful lives and methods of financial assets, expected credit losses are measured which it is a lessee, except for leases with a term of twelve
• Share-based payments depreciation of property, plant and equipment are at an amount equal to the 12-month ECL, unless there month or less (short-term leases) and low value leases.
reviewed at each financial year-end and adjusted has been a significant increase in credit risk from
• Financial instruments. For these short-term and low value leases, the Company
prospectively, if appropriate. initial recognition in which case those are measured at recognizes the lease payments as operating expense on
lifetime ECL. The amount of expected credit losses (or straight-line basis over the term of lease.
3. Significant accounting policies iv. Reclassification to investment property reversal) that is required to adjust the loss allowance at
a) Property, plant and equipment the reporting date to the amount that is required to be The right-of-use assets are initially recognized at cost,
When the use of a property changes from owner-occupied
recognised is recognised as an impairment gain or loss in which comprises the initial amount of the lease liability
to investment property, the property is reclassified as
i. Recognition and measurement statement of profit or loss. adjusted for any lease payments made at or prior to the
investment property at its carrying amount on the date of
classification. commencement date of the lease plus any initial direct
Items of property, plant and equipment, are measured ii. Non -financial assets costs less any lease incentives. They are subsequently
at cost (which includes capitalised borrowing costs, if measured at cost less accumulated depreciation and
v. Capital work-in-progress includes cost of property, plant Intangible assets and property, plant and equipment
any) less accumulated depreciation and accumulated impairment losses.
and equipment under installation / under development as
impairment losses, if any.
at the balance sheet date. Intangible assets and property, plant and equipment are
The Right of use of assets are depreciated from the
Cost of an item of property, plant and equipment includes evaluated for recoverability whenever events or changes
b) Intangible assets commencement date on a straight line basis over the
its purchase price, duties, taxes, after deducting trade in circumstances indicate that their carrying amounts
shorter of the lease term and useful life of the underlying
discounts and rebates, any directly attributable cost of may not be recoverable. For the purpose of impairment
i. Recognition and measurement asset. Right of use of assets are evaluated for recoverability
bringing the item to its working condition for its intended testing, the recoverable amount (i.e. the higher of the fair
whenever events or changes in circumstances indicate
use and estimated costs of dismantling and removing the Intangible assets that are acquired by the Company, value less cost to sell and the value-in-use) is determined
that their carrying amounts may not be recoverable.
item and restoring the site on which it is located. which have finite useful lives, are measured at cost less on an individual asset basis unless the asset does not
accumulated amortisation and accumulated impairment generate cash flows that are largely independent of The Lease liability is initially measured at amortized cost
The cost of a self-constructed item of property, plant and losses. Cost includes expenditures that are directly those from other assets. In such cases, the recoverable at the present value of future lease payments. The lease
equipment comprises the cost of materials, direct labour attributable to the acquisition of the intangible asset. amount is determined for the CGU to which the asset payments are discounted using the interest rate implicit
and any other costs directly attributable to bringing the belongs. If such assets are considered to be impaired, the in the lease, or if not readily determinable, using the
item to its intended working condition and estimated ii. Subsequent expenditure impairment to be recognised in the Statement of Profit incremental borrowing rates in the country of domicile
costs of dismantling, removing and restoring the site on and Loss is measured by the amount by which the carrying of the leases. Lease Liabilities are re measured with
which it is located, wherever applicable. If significant Subsequent expenditure is capitalised only when it value of the assets exceeds the estimated recoverable corresponding adjustment to the related right to use of
parts of an item of property, plant and equipment have increase the future economic benefits embodied in the amount of the asset. An impairment loss is reversed in the asset if company changes its assessment if whether it will
different useful lives, then they are accounted for as specific assets to which it relates. All other expenditure statement of profit and loss if there has been a change in exercise an extension or termination option.
separate items (major components) of property, plant are recognised in profit or loss as incurred.
and equipment.

146 147
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

Lease liability and ROU asset have been separately f) Financial instruments Financial liabilities Gross turnover is reduced by rebates, discounts,
presented in the Balance Sheet and lease payments have allowances and product returns given or expected to
been classified as financing cash flows. i. Recognition and initial measurement Financial liabilities are subsequently carried at amortised be given, which vary by product arrangements and
cost using the effective interest method. For trade and buying groups. These arrangements with purchasing
The following is the summary of practical expedients The Company initially recognises financial assets and other payables maturing within one year from the balance organisations are dependent upon the submission of
elected on initial application. financial liabilities when it becomes a party to the sheet date, the carrying amounts approximate fair value claims sometime after the initial recognition of the sale.
contractual provisions of the instrument. All financial due to the short maturity of these instruments. Accruals are made at the time of sale for the estimated
1. Applied a single discount rate to portfolio of leases assets and liabilities are measured at fair value on initial
rebates, discounts or allowances payable or returns to
of similar assets in similar economic environment recognition. Transaction costs that are directly attributable iii. Derecognition
be made, based on available market information and
with similar end date. to the acquisition or issue of financial assets and financial
Financial assets historical experience.
liabilities that are not at fair value through profit or loss
2. Applied the exemption not to recognize right to use are added to the fair value on initial recognition. Regular
The Company derecognises a financial asset when the Because the amounts are estimate they may not fully
of asset and liabilities for leases with less than 12 way purchase and sale of financial assets are accounted
contractual rights to the cash flows from the financial asset reflect the final outcome, and the amounts are subject
months of lease term of the date of initial application. for at trade date.
expire, or it transfers the right to receive the contractual to change dependent upon, amongst other things, the
3. Applied the practical expedient to grandfather cash flows in a transaction in which substantially all of the types of buying Group and product sales mix.
ii. Classification and subsequent measurement Financial
the assessment of which transactions are leases. Assets risks and rewards of ownership of the financial assets are
The level of accrual for rebates and returns is reviewed
Accordingly IND AS 116 is applied only to contracts transferred or in which the Company neither transfers nor
and adjusted regularly in the light of contractual and
that were previously identified as leases under IND Financial assets carried at amortised cost retains substantially all of the risks and rewards of ownership
legal obligations, historical trends, past experience
AS 17 and does not retain control of the financial asset.
A debt instrument is subsequently measured at amortised and projected market conditions. Market conditions
4. Excluding initial direct costs for the measurement of cost if it is held within a business model whose objective If the Company enters into transactions whereby it are evaluated using wholesaler and other third-party
right to use of asset at the date of initial application. is to hold the asset in order to collect contractual cash transfers assets recognised on its balance sheet, but analyses, market research data and internally generated
flows and the contractual terms of the financial asset retains either all or substantially all of the risks and information.
e) Inventories give rise on specified dates to cash flows that are solely rewards of the transferred assets, the transferred assets
Future events could cause the assumptions on which
payments of principal and interest on the principal are not derecognised.
Inventories are valued at the lower of cost (including the accruals are based to change, which could affect the
amount outstanding.
prime cost, GST and other overheads incurred in bringing Financial liabilities future results of the Group.
the inventories to their present location and condition) Financial assets at fair value through other
and estimated net realisable value, after providing for The Company derecognises a financial liability when its Processing charges is recognised as per the terms of the
comprehensive income
obsolescence, where appropriate. The comparison of contractual obligations are discharged or cancelled, or contract when the related services are rendered.
cost and net realisable value is made on an item-by-item A debt instrument is subsequently measured at fair value expire.
Dividend income is recognised when the Company’s right
basis. The net realisable value of materials in process is through other comprehensive income if it is held within
The Company also derecognises a financial liability when to receive the payment is established, which is generally
determined with reference to the selling prices of related a business model whose objective is achieved by both
its terms are modified and the cash flows under the when shareholders approve the dividend.
finished goods. Raw materials, packing materials and collecting contractual cash flows and selling financial
other supplies held for use in production of inventories assets and the contractual terms of the financial asset modified terms are substantially different. In this case,
Interest income is recognised using the effective interest
are not written down below cost except in cases where give rise on specified dates to cash flows that are solely a new financial liability based on the modified terms is
method.
material prices have declined, and it is estimated that payments of principal and interest on the principal recognised at fair value. The difference between the
the cost of the finished products will exceed their net amount outstanding. carrying amount of the financial liability extinguished and h) Foreign currencies
realisable value. a new financial liability with modifie d terms is
In case, the Company’s management has made an recognised in the statement of profit and loss. Initial Recognition
The provision for inventory obsolescence is assessed irrevocable election at the time of initial recognition to
regularly based on estimated usage and shelf life of products. account for the equity investment (Other than Investments iv. Offsetting On initial recognition, transaction in foreign currencies
in equity instruments of Subsidiary) fair value through other entered into by the company are recorded in the
Raw materials, packing materials and stores and spares Financial assets and financial liabilities are offset and functional currency (INR), by applying to the foreign
comprehensive income. This election is not permitted if
are valued at cost computed on first in first out basis. The the net amount presented in the balance sheet when, currency amount, the spot exchange rate between the
the equity investment is held for trading. The classification
cost includes purchase price, inward freight and other and only when, the Company currently has a legally functional currency and the foreign currency at the
is made on initial recognition and is irrevocable.
incidental expenses net of refundable duties, levies and enforceable right to set off the amounts and it intends date of the transaction. Exchange differences arising on
taxes, where applicable. Investment in subsidiary either to settle them on a net basis or realise the asset foreign exchange transactions settled during the year are
and settle the liability simultaneously. recognised in the Statement of Profit & Loss.
Work-in-progress is valued at input material cost plus Investment in subsidiary is carried at cost in the financial
conversion cost as applicable. statements. g) Revenue recognition Measurement of foreign currency items at reporting
date
Stock-in-trade and finished goods are valued at the lower Financial assets at fair value through profit or loss Revenue is recognised when title and risk of loss is
of net realisable value and cost (including prime cost and passed to the customer, reliable estimates can be made Foreign currency monetary items of the company are
other overheads incurred in bringing the inventories to A financial asset which is not classified in any of the above of relevant deductions and all relevant obligations have translated at the closing exchange rates. Non-monetary
their present location and condition), computed on a first categories are subsequently fair valued through profit or been fulfilled, such that the earnings process is regarded items that are measured at historical cost in foreign
in first out basis. loss. as being complete. currency are translated using the exchange rates at the

148 149
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

date of the transaction. Non-monetary items that are • Temporary differences related to investments k) Borrowing costs The Company also provides for post-employment defined
measured at fair value in a foreign currency, are translated in subsidiaries, associates and interests in joint benefit in the form of gratuity. The cost of providing
using the exchange rates at the date when the fair value is ventures, when the timing of the reversal of the Borrowing costs directly attributable to the acquisition benefit is determined using the projected unit credit
measured. temporary differences can be controlled and it is or construction of those property, plant and equipment method, with actuarial valuation being carried out at each
probable that the temporary differences will not which necessarily takes a substantial period of time to balance sheet date. Re measurement of the net benefit
Exchange differences arising out of these translations reverse in the foreseeable future. get ready for their intended use are capitalised. All other liability, which comprise actuarial gains and losses,
are recognised in the Statement of Profit & Loss except borrowing costs are expensed in the period in which they the return on plan assets (excluding interests) and the
exchange differences on long term foreign currency Deferred tax assets are recognised to the extent that it incur in the statement of profit and loss. effect of the assets ceiling (if any, excluding interest) are
monetary items related to acquisition of fixed assets prior is probable that future taxable profits will be available recognised in other comprehensive income. The effect of
to transition to Ind AS, which are included in the cost of against which they can be used. l) Provisions, contingent liabilities and contingent assets
any plan amendments are recognised in net profit in the
fixed assets. Statement of Profit and Loss.
Deferred tax assets recognised or unrecognised are The company recognizes the provisions when a present
i) Government grants reviewed at each reporting date and are recognised obligation (legal or constructive) as a result of past event
Other long-term employee benefits
/ reduced to the extent that it is probable / no longer exists and it is probable that an outflow of resources
Government grants are recognised where there is probable respectively that the related tax benefit will be embodying economic benefits will be required to settle All employee benefits (other than post-employment
reasonable assurance that the grant will be received and realised. such obligation and the amount of such obligation can be benefits and termination benefits) which do not fall due
all attached conditions will be complied with. When the reliably estimated. wholly within twelve months after the end of the period
grant relates to revenue, it is recognised in the statement Deferred tax is measured at the tax rates that are in which the employees render the related services are
of profit and loss on a systematic basis over the periods expected to apply to the period when the asset is realised If the effect of time value of money is material, provisions
determined based on actuarial valuation or discounted
to which they relate. When the grant relates to an asset, or the liability is settled, based on the laws that have been are discounted using a current pre-tax rate that reflects
present value method carried out at each balance sheet
it is treated as deferred income and recognised in the enacted or substantively enacted by the reporting date. when appropriate, the risk specific to the liability. When
date. The expected cost of accumulating compensated
statement of profit and loss on a systematic basis over discounting is used, the increase in provision due to
absences is determined by actuarial valuation performed
the useful life of the asset. The measurement of deferred tax reflects the tax passage of time is recognised as a finance cost.
by an independent actuary as at every year end using
consequences that would follow from the manner in which
A disclosure for a contingent liability is made when there projected unit credit method on the additional amount
j) Income tax the Company expects, at the reporting date, to recover or
is possible obligation or a present obligation that may, expected to be paid / availed as a result of the unused
settle the carrying amount of its assets and liabilities.
Income tax comprises current and deferred tax. It is but probably will not require an outflow of resources entitlement that has accumulated at the balance sheet
recognised in profit or loss except to the extent that it The Company offsets, the current tax assets and liabilities embodying the economic benefits or the amount of such date. Expense on non-accumulating compensated
relates to a business combination or to an item recognised (on a year on year basis) and deferred tax assets and obligation cannot be measured reliably. When there is absences is recognised in the period in which the
directly in equity or in other comprehensive income. liabilities, where it has a legally enforceable right and possible obligation or a present obligation in respect of absences occur.
where it intends to settle such assets and liabilities on a which likelihood of outflow of resources embodying the
i. Current tax n) Share-based payments
net basis. economic benefits is remote, no provision or disclosure is
made. The cost of equity-settled transactions is determined by
Current tax comprises the expected tax payable or Presentation of current and deferred tax
receivable on the taxable income or loss for the year and the fair value at the date when the grant is made using
Contingent assets are not recognised. However, when the
any adjustment to the tax payable or receivable in respect Current and deferred tax are recognised as income or an appropriate valuation model. That cost is recognised,
realisation of income is virtually certain, then the related
of previous years. The amount of current tax reflects the an expense in the Statement of Profit & Loss, except together with a corresponding increase in share-based
asset is no longer a contingent asset, and is recognised as
best estimate of the tax amount expected to be paid or when they relate to items that are recognised in Other payment (SBP) reserves in equity, over the period in
an asset.
received after considering the uncertainty, if any related to Comprehensive Income, in which case, the current and which the performance and/or service conditions are
income taxes. It is measured using tax rates (and tax laws) deferred tax income/ expense are recognised in Other m) Employee benefits fulfilled in employee benefits expense. The dilutive effect
enacted or substantively enacted by the reporting date. Comprehensive Income. of outstanding options is reflected as additional share
Short-term employee benefits dilution in the computation of diluted earnings per share.
ii. Deferred tax The Company offsets current tax assets and current tax
liabilities, where it has legally enforceable right to set off the All employee benefits falling due wholly within twelve o) Cash and cash equivalents
Deferred tax is recognised in respect of temporary recognised amounts and where it intends either to settle months of rendering the services are classified as short-
differences between the carrying amounts of assets term employee benefits, which include benefits like Cash and cash equivalents includes cash in hand, demand
on a net basis, or to realize the asset and settle the liability
and liabilities for financial reporting purposes and the salaries, wages, short-term compensated absences deposits with banks, other short-term highly liquid
simultaneously. In case of deferred tax assets and deferred
corresponding amounts used for taxation purposes. and performance incentives and are recognised as investments with original maturities of three months or less.
tax liabilities, the same are offset if the company has
Deferred tax is also recognised in respect of carried legally enforceable right to set off corresponding current expenses in the period in which the employee renders the
p) Earnings per share
forward tax losses and tax credits. Deferred tax is not tax assets against current tax liabilities and the deferred related service.
recognised for: tax assets and deferred tax liabilities relate to income taxes Basic Earnings Per Share (‘EPS’) is computed by dividing
Post-employment benefits
levied by the same tax authority on the company. the net profit attributable to the equity shareholders
• Temporary differences arising on the initial
Contributions to defined contribution schemes such by the weighted average number of equity shares
recognition of assets or liabilities in a transaction MAT Credits are in the form of unused tax credits that are
as Provident Fund, Employees State Insurance., are outstanding during the year. Diluted earnings per share
that is not a business combination and that affects carried forward by the Company for a specified period of
recognised as expenses in the period in which the is computed by dividing the net profit by the weighted
neither accounting nor taxable profit or loss at the time, hence it is grouped with Deferred Tax Asset/Net of
employee renders the related service. The Company has average number of equity shares considered for deriving
time of transaction. Deferred tax liabilities.
no further obligations beyond its monthly contributions. basic earnings per share and also the weighted average

150 151
 Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

number of equity shares that could have been issued Balance Sheet:

reporting period. The Company has opted to apply this exemption and accordingly the Company has adjusted foreign exchange loss of ` 4.55 million
for the year ended 31st March, 2021 (31st March, 2020: loss of ` 30.04 million) arising on reporting of long term foreign currency monetary item against
` million

1. Under the Indian GAAP, Company was following the accounting treatment as per paragraph 46/ 46A of AS 11 ‘The Effects of Changes in Foreign

account of depreciable assets was added/ deducted from the cost of the depreciable asset, which was depeciated over the balance life of the asset. Ind
AS 101 includes an optional exemption that allows a first-time adopter to continue the above accounting treatment in respect of the long-term foreign
Exchange Rates’, with respect to exchange differences arising on restatement of long term foreign currency monetary items. Exchange differences on

currency monetary items recognised in the Financial Statements for the period ending immediately before the beginning of the first Ind AS financial
-
Total

5,167.80
694.49
-
41.52 153.52 5,862.29

- 1,410.54
494.38

18.71 1,904.92

9.43 134.81 3,957.37

41.52 153.52 5,862.29

308.19
-

477.88
-
42.16 153.52 6,170.48

18.71 1,904.92

50.41 2,382.80

103.11 3,787.68
upon conversion of all dilutive potential equity shares.
Dilutive potential equity shares are deemed converted • Lease liabilities should be separately disclosed under the
as of the beginning of the year, unless issued at a later head ‘financial liabilities’, duly distinguished as current or
non-current.

-
18.71

-
-

31.70
-
Office Computer Right
of Use
Assets

-
3.00 153.52
date. In computing diluted earnings per share, only
potential equity shares that are dilutive and that either
• Certain additional disclosures in the statement of changes
reduces earnings per share or increases loss per share are
in equity such as changes in equity share capital due to

-
38.52

20.54
11.55

32.09

0.64
-

32.09
4.83

36.92

5.24
included. The number of shares and potentially dilutive
prior period errors and restated balances at the beginning
equity shares are adjusted retrospectively for all periods
of the current reporting period.
presented for the share splits.
• Specified format for disclosure of shareholding of

-
equipment

18.17
6.47
-
24.64

7.22
3.87

11.09

13.55

24.64
1.03

25.67

11.09
3.85

14.94

10.73
q) Cash flow statement
promoters. Specified format for ageing schedule of trade
Cash flows are reported using indirect method, whereby receivables, trade payables, capital work-in progress and
net profits before tax is adjusted for the effects of intangible asset under development
transactions of a non-cash nature and any deferrals or

-
Leasehold Buildings Plant and Furniture Vehicles

27.73
27.82

55.55

10.53
5.19

15.72

39.83

55.55
1.33

56.88

15.72
6.84

22.56

34.32
• If a company has not used funds for the specific purpose
accruals of past or future cash receipts or payments and
for which it was borrowed from banks and financial
items of income or expenses associated with investing or
institutions, then disclosure of details of where it has been
financing cash flows. The cash flows from regular revenue
used.

-
and
Fixtures

39.05
1.10

40.15

8.17
4.03

12.20

27.95

40.15
0.38

40.53

12.20
4.01

16.21

24.32
generating (operating activities), investing and financing
activities of the Company are segregated. • Specific disclosure under ‘additional regulatory
requirement’ such as compliance with approved
r) Segment Reporting

-
Equipment

4,113.01
491.62

4,604.63

1,244.12
413.66

1,657.78

2,946.85

4,604.63
257.66

4,862.29

1,657.78
389.65

2,047.43

2,814.86
schemes of arrangements, compliance with number of
Operating segments are reported in a manner consistent layers of companies, title deeds of immovable property
with the internal reporting provided to the Chief Operating not held in name of company, loans and advances

2. For details of assets given as security against borrowings, Refer note 17 and note 20
Decision Maker (CODM) of the company. The CODM to promoters, directors, key managerial personnel
(KMP) and related parties, details of benami property

-
734.39
6.13

740.52

88.32
31.46

119.78

620.74

740.52
47.15

787.67

119.78
35.82

155.60

632.07
is responsible for allocating resources and assessing

3. Amount of contractual commitments for the acquisition of PPE, Refer note 40

performance of the operating segments of the company. held etc.

s) Recent Accounting Developments Statement of Profit and Loss:

1.10
-

5.91
-

-
building
Improvements

40.51

41.61

31.64

37.55

4.06

41.61
-

41.61

37.55
1.18

38.73

2.88
The Ministry of Corporate Affairs (“MCA”) vide notification • Additional disclosures relating to Corporate Social
dated 24th March, 2021 amended the Schedule III of the Responsibility (CSR), undisclosed income and crypto
Companies Act, 2013. The amendments related to Division or virtual currency specified under the head ‘additional
I, II and III of Schedule III and are applicable starting information’ in the notes forming part of the standalone
1st April , 2021. Key amendments relating to Division II which financial statements.

-
-

-
Freehold
land

156.42
3.73

160.15

160.15

160.15
-

160.15

-
-

160.15
related to companies whose financial statements are
The said amendments will be given effect by the Company for
required to comply with Companies (Indian Accounting
period starting 1st April, 2021.
Standards) Rules 2015 are:

Closing gross carrying amount as at 31st March, 2020

Closing gross carrying amount as at 31st March, 2021

Net carrying amount as at 31st March, 2020

Net carrying amount as at 31st March, 2021

Closing accumulated depreciation up to

Closing accumulated depreciation up to

Note 4: Property, plant and equipment

the historical cost of fixed assets

Depreciation charge during the year

Depreciation charge during the year

Opening accumulated depreciation

Opening accumulated depreciation

Opening gross carrying amount

Opening gross carrying amount

Year ended 31st March, 2020

Year ended 31st March, 2021

Accumulated depreciation

Accumulated depreciation
Additions during the year

Additions during the year

Disposals during the year

Disposals during the year

Disposals during the year

Disposals during the year

Gross carrying amount

Gross carrying amount

31st March, 2020

31st March, 2021

Particulars

Notes
152 153
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

Note 5: Other intangible assets ` million ` million

Particulars Computer Brands / Trade Total Particulars Face As at 31 March, 2021
st
As at 31 March, 2020
st

software Marks value Quantity Value Quantity Value

Year ended 31 March, 2020
st (Nos) (Nos)
Gross carrying amount Investment in other entities (fair value through Profit and
Loss)
Opening gross carrying amount 59.04 4.88 63.92
Sharad Sahakari Bank Ltd. 318 0.02 318 0.02
Additions during the year 2.90 8.60 11.50
SVC Bank Ltd 100 0.00
Closing gross carrying amount as at 31st March, 2020 61.94 13.48 75.42
Quoted
Accumulated amortisation
Investment in mutual fund (fair value through Profit and
Opening accumulated amortisation 29.30 0.45 29.75
Loss)
Amortisation charge for the year 18.40 0.97 19.37
PFG-Union Balanced Advantage Fund Regular Plan - 4,99,990 6.96 4,99,990 4.77
Closing accumulated amortisation up to 31 March, 2020
st
47.70 1.42 49.12
Growth
Closing net carrying amount as at 31st March, 2020 14.24 12.06 26.30
FSGP-IDBI Banking & Financial Services Fund - Regular 1,00,000 1.22 1,00,000 0.73
Year ended 31st March, 2021 Plan-Growth
Gross carrying amount Total 630.84 628.16
Opening gross carrying amount 61.94 13.48 75.42 Total non-current investments 630.84 628.16
Additions during the year 8.85 - 8.85 Aggregate amount of quoted investments and market value 8.18 5.50
Closing gross carrying amount as at 31st March, 2021 70.79 13.48 84.27 thereof
Accumulated amortisation Aggregate amount of unquoted investments 622.66 622.66
Opening accumulated amortisation 47.70 1.42 49.12 Aggregate amount of impairment in the value of - -
investments
Amortisation charge for the year 14.55 1.33 15.88
Closing accumulated depreciation up to 31st March, 2021 62.25 2.75 65.00 Note: The investments is in compliance with Section 186(4) of the Companies Act, 2013.
Net carrying amount as at 31 March, 2021
st
8.54 10.73 19.27 Note 7: Other financial assets - Non-current ` million
There are no contractual commitments for the acquisition of intangible assets. Particulars As at As at
31st March, 2021 31st March, 2020
Note 6: Other Investments
Unsecured, considered good
` million
Fixed deposits having original maturity of more than one year 3.21 2.49
Particulars Face As at 31st March, 2021 As at 31st March, 2020
Interest Receivable 0.03 0.00
value Quantity Value Quantity Value
Deposits 117.47 118.47
(Nos) (Nos)
Total 120.71 120.96
Unquoted
Investment in equity instruments (fully paid-up) Note 8: Other non-current assets ` million
Investment in wholly owned subsidiary carried (at cost) Particulars As at As at
Bhagyalaxmi Dairy Farm Private Limited ` 10 57,85,354 622.64 57,85,354 622.64 31st March, 2021 31st March, 2020
Investment in other entities (fair value through Profit and Unsecured, considered good
Loss) Capital advances 15.22 65.74
OPGS Power Gujarat Private Limited 2,18,000 - 2,18,000 - Prepaid expenses 8.44 9.40
Rupee Co-Operative Bank Ltd. 3,800 - 3,800 - Total 23.66 75.14
Other Investments
Unquoted

154 155
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

Note 9 : Inventories (At lower of cost and net realisable value) ` million Note 11: Cash and cash equivalents ` million

Particulars As at As at Particulars As at As at
31st March, 2021 31st March, 2020 31st March, 2021 31st March, 2020
Raw materials 98.71 94.46 Balances with banks
Work-in-progress 4,879.23 3,840.44 in current accounts 16.29 73.44
Finished goods 1,636.16 2,094.19 Short term Bank deposits (Maturity within 3 months) 25.41 125.26
Packing material 142.68 125.62 Cash on hand 23.64 14.45
Stores and spares 116.54 113.56 Total 65.34 213.15
Total 6,873.32 6,268.27
Note 12: Bank balances (other than above) ` million
Note:
Particulars As at As at
For Inventories pledged as securities against borrowings, see note 17 and 20. 31st March, 2021 31st March, 2020

The above includes goods in transit as below: ` million Short term Bank deposits (Maturity more than 3 months but less than 12 months) 117.06 54.55

Particulars As at As at Total 117.06 54.55

31st March, 2021 31st March, 2020
Note 13: Other current assets ` million
Stock in transit - finished goods 18.35 8.17
Particulars As at As at
Note: 31st March, 2021 31st March, 2020

The cost of inventories recognised as an expense includes ` 16.17 million (31st March, 2020: ` 12.60 million) in respect of write Advances other than capital advances
down of inventories to net realizable value. Further, a sum of ` 12.60 million (31st March, 2020: ` 0.65 million) in respect of reversal Unsecured, considered good:
of such write downs. Previous write downs have been reversed as a result of appreciation in market price of such inventories. Prepaid expenses 6.87 15.56

Note 10: Trade receivables ` million Advances and other recoverables 2,318.99 1,196.71
Recoverable from statutory and government authorities
Particulars As at As at
31st March, 2021 31st March, 2020 Unsecured, considered good:
Unsecured, Considered good 1,559.15 2,994.85 Electricity duty receivable 22.20 22.20
Unsecured, Considered doubtful 970.91 1,145.95 PSI incentive and export subsidy receivable 647.75 607.04
Less: Allowance for doubtful debts (970.91) (1,145.95) Milk incentive receivable 86.20 216.51
- -
GST, VAT and Sales tax receivable 38.28 43.96
Total 1,559.15 2,994.85
Interest receivable - 8.61
Note: Unsecured, considered doubtful

(a) No trade receivables are due from directors or other officers of the Company, either severally or jointly with any other person, Advances and other recoverables 20.98 20.98
nor any trade and other receivables are due from firms or private companies respectively in which any directors is a partner, Recoverable from statutory and government authorities 25.24 25.24
a director or a member. Less: Allowance for doubtful advances (46.22) (46.22)

(b) The Company’s exposure to credit and currency risk related to trade receivables are disclosed in note 36 A & 36 C Interest receivable 0.07 7.57
Grand Total 3,120.36 2,118.16
(c) Trade receivables are receivable in normal operating cycle and are shown net of an allowance for bad or doubtful debts.
Note 14: Current tax assets (net) ` million
(d) Trade receivables stated above are charged on a first pari-passu basis between working capital consortium members led by
Union Bank of India, State Bank of India and IDBI Bank Ltd. Particulars As at As at
31st March, 2021 31st March, 2020
Current tax assets (net) 1.33 -
Total 1.33 -

156 157
 Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

Note 15: Equity share capital (d) Details of shareholders holding more than 5% shares in the Company

(a) Authorised equity share capital ` million Particulars As at 31st March, 2021 As at 31st March, 2020
Particulars Number of Face Value Amount Number of % holding Number of % holding
shares (Nos.) (`) shares (Nos.) shares (Nos.)
As at 1st April, 2019 10,00,00,000 10.00 1,000.00 Equity shares of ` 10 each fully paid
Change during the year - - - Mr. Devendra Prakash Shah 1,52,06,400 18.12% 152,06,400 18.12%
As at 31st March, 2020 10,00,00,000 10.00 1,000.00 Mr. Pritam Prakash Shah 91,59,888 10.91% 91,59,888 10.91%
Change during the year - - - Mrs. Netra Pritam Shah 88,67,027 10.56% 88,67,027 10.56%
As at 31 March, 2021
st
10,00,00,000 10.00 1,000.00 Stichting Depositary APG Emerging - 0.00% 61,28,938 7.30%
Markets Equity Pool
(b) Issued, subscribed and fully paid up share capital ` million
IDFC Trustee Co. Ltd A/C IDFC 50,42,534 6.01% 50,42,534 6.01%
Particulars Number of Face Value Amount Infrastructure Fund
shares (Nos.) (`)
(e) As per records of the Company, including its register of shareholders/members, the above shareholding represents legal
As at 1st April, 2019
ownerships of shares. The above percentage have been computed after excluding 176,015 nos (31st March, 2020 176,015 nos)
Issued subscribed and fully paid up share capital (including 8,41,14,582 10.00 841.15 of equity shares issued to ESOS Trust.
share issued to ESOP Trust)
Less: Amount recoverable from ESOP Trust (face value of 1,76,015 10.00 1.76 (f) The Company has not issued any equity shares pursuant to contract without payment being received in cash or by way of
1,76,015 share alloted to the Trust) bonus shares or bought back any equity shares during the last five years preceding the balance sheet date.
Net Issued, subscribed and fully paid up share capital 8,39,38,567 10.00 839.39
(g) The Board of Directors have recommended payment of final dividend of ` 0.50 (Fifty Paisa only) per equity share of the face
Add: Issued during the year by ESOP Trust to employees (refer - 10.00 - value of ` 10 each for the financial year ended 31st March, 2021. The total dividend for the year paid is ` 0.50 (Fifty Paisa only)
note 45) per equity share of the face value of ` 10 each.
As at 31st March, 2020 8,39,38,567 10.00 839.39
Note 16: Other Equity ` million
Issued subscribed and fully paid up share capital (including 8,41,14,582 10.00 841.15
share issued to ESOP Trust)
Particulars As at As at
Less: Amount recoverable from ESOP Trust (face value of 1,76,015 10.00 1.76 31st March, 2021 31st March, 2020
1,76,015 share alloted to the Trust)
Securities Premium 4,447.85 4,447.85
Net Issued, subscribed and fully paid up share capital 8,39,38,567 10.00 839.39
General Reserve 59.26 59.26
Add: Issued during the year by ESOP Trust to employees (refer - 10.00 -
note 45) Retained Earnings 3,844.12 3,711.64

As at 31 March, 2021
st
8,39,38,567 10.00 839.39 Employee Stock Options Outstanding 7.29 8.27
Other Comprehensive Income 0.22 (5.49)
(c) Terms and rights attached to equity shares
Total 8,358.74 8,221.53
The Company has only one class of shares referred to as equity shares having a par value of ` 10 per share. Each holders of
Note:
equity shares carry one vote per share without restrictions and are entitled to dividend, as and when declared. In the event
of liquidation of the Company, the holders of equity shares will be entitled to receive the remaining assets of the Company, For movements in reserves - refer Statement of Changes in Equity.
after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the
Nature and purpose of reserves
shareholders.
(a) The amount received in excess of face value of the equity shares is recognised in the securities premium. This reserve will be
utilised in accordance with the provisions of Section 52 of the Companies Act, 2013 (“the Act”).
(b) General reserve is created from time to time by transferring profits from retained earnings and can be utilised for purposes
such as dividend payout, bonus issue, etc
(c) Retained earnings are the profits that the Company has earned till date, net-off less any transfers to general reserve, dividends
or other distribution to the shareholders.
(d) The shares option outstanding account is used to recognise the grant date fair value of options issued to employees
under the Employee Stock Grant Scheme which are unvested as on the reporting date and is net of the deferred employee
compensation expense.

158 159
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

Note 17: Borrowings - Non-current ` million Note 19: Provisions ` million

Particulars As at As at Particulars As at As at
31st March, 2021 31st March, 2020 31st March, 2021 31st March, 2020
Measured at amortised cost Non-current:
Secured Provision for compensated absences (refer note 39) 2.89 2.74
Term loans Provision for gratuity (net) (refer note 39) 37.15 40.62
From banks Total 40.04 43.36
Rupee Currency Loan 312.08 395.64 Current:
Provision for compensated absences (refer note 39) 4.44 4.21
Foreign currency loan 177.10 361.40
Total 4.44 4.21
Vehicle Loan 21.63 25.83
From other than banks Note 20: Borrowings - current ` million
Vehicle Loan - 0.89
Particulars As at As at
510.81 783.76
31st March, 2021 31st March, 2020
Less: Current maturity (302.18) (302.28) Secured
Total 208.63 481.48 Loans repayable on demand
From banks- cash credit 3,125.60 3,167.10
Note:
Total 3,125.60 3,167.10
(a) Indian rupee loans from a bank of ` 312.08 million (31st March, 2020 : ` 395.64 million) carry interest @ 9.15%-10.10%. The
Note:
loans are repayable over 48-60 monthly instalments starting from March 2018, June 2019, July 2019, August 2019, September
2019, December 2019, and September 2020 along with interest. The loan is secured by pari pasu charge on fixed assets and (a) Cash credit from banks are secured by first pari pasu charge on all current assets of the Company and second pari pasu
second pari pasu charge on current assets of the Company and personal guarantee of Promoter Directors. charge on fixed assets of the Company, personal guarantee of Promoter Directors. The cash credit is repayable on demand
and carries interest @ 7.75% p.a. to 11.60% p.a.
(b) Foreign currency loan from a financial institution of ` 177.10 million (31st March, 2020 : ` 361.40 million) carries interest @
4.50%-6.19%. The loans are repayable in 12 semi annual instalments along with interest starting from June, 2016. The loan is (b) Average interest rate for the current borrowings is 9.86%
secured by first pari passu charge on movable and immovable fixed property and second pari pasu charge of entire current
assets of the Company along with other banks and personal guarantees of Directors and their relatives. Note 21: Trade payables - current ` million

(c) Hire purchase loan from banks of ` 21.63 million (31st March, 2020 : ` 25.83 million) carries interest @ 9.20% to 9.35% p.a. Particulars As at As at
The loans are repayable in 60 monthly instalments starting from December 2018 and November 2019. The loan is secured by 31st March, 2021 31st March, 2020
specific assets financed (vehicle). (A) total outstanding dues of micro enterprises and small enterprises; and 8.97 25.03

(d) Indian rupee loans from financial institutions of ` Nil million (31 March, 2020 : ` 0.89 million) represents loan secured by
st (B) total outstanding dues of creditors other than micro enterprises and small enterprises. 2,879.10 2,789.26
hypothecation of equipments and vehicles. The loans are repayable over 36 - 60 instalments and carry interest of 11.72%. Total 2,888.07 2,814.29

(e) Average interest rate for the non-current borrowings is 7.93% Note : Disclosure under Micro, Small, and Medium Enterprises Development Act, 2006 :

Note 18: Other financial liabilities ` million (a) Micro, Small and Medium enterprises have been identified by the Company on the basis of the information available. Total
outstanding dues to suppliers which are outstanding for more than the stipulated period and other disclosures as per the
Particulars As at As at
Micro, Small and Medium Enterprises Development Act, 2006, (MSMED Act) as at 31st March, 2021. The disclosure pursuant
31st March, 2021 31st March, 2020
to the said Act is as under:
Non-current:
Lease liability 84.04 109.75
Total 84.04 109.75

160 161
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

` million Note 24: Current tax liabilities (net) ` million

Particulars 31st March, 2021 31st March, 2020 Particulars As at As at

/2020-21 /2019-20 31st March, 2021 31st March, 2020
The principal amount and the interest due thereon remaining unpaid to any Current tax liability (net) - 76.84
supplier at the end of each accounting year
Total - 76.84
Principal 8.97 17.48
Interest 8.92 7.55 Note 25 : Revenue from Operations ` million

The amount of interest paid by the buyer in terms of Section 16 of the MSMED - - Particulars 2020-21 2019-20
Act, 2006 along with the amount of the payment made to the supplier beyond the
A. Sale of products (excluding GST, as applicable) :
appointed day during each accounting year
Sale of manufactured goods 16,231.69 21,750.31
The amount of interest due and payable for the period of delay in making payment 35.75 37.73
Sale of traded goods 1,210.56 1,797.15
(which have been paid but beyond the appointed day during the year) but without
17,442.25 23,547.46
adding the interest specified under the MSMED Act, 2006
B. Other operating revenues comprise:
The amount of interest accrued and remaining unpaid at the end of each 8.92 7.55
accounting year Processing charges 306.41 71.60
Export benefits and incentives 4.32 9.61
The amount of further interest remaining due and payable even in the succeeding 8.92 7.55
years, until such date when the interest dues as above are actually paid to the PSI incentive 157.19 212.97
small enterprise, for the purpose of disallowance as a deductible expenditure Milk incentive - 63.22
under Section 23 of the MSMED Act, 2006 Scrap sale 7.18 7.91
475.10 365.31
(b) The information has been given in respect of such vendors to the extent they could be identified as micro and small
Total (A+B) 17,917.35 23,912.77
enterprises on the basis of information available with the Company.
Note :
Note 22: Other current financial liabilities ` million
(a) In accordance with Indian Accounting Standard (Ind AS) 20, Accounting for Government Grants and Disclosure of
Particulars As at As at
Government Assistance, the Company has accounted for Industrial Promotion Subsidy under Package Scheme of Incentives,
31 March, 2021
st
31 March, 2020
st
2013 amounting to ` 157.19 million ( 31st March, 2020: ` 212.97 million) as Other Operating Income in Statement of Profit and
Current maturities of long-term debt (refer note 17) 302.18 302.28
Loss.
Interest accrued but not due on borrowings 12.65 14.11
Deposits 95.34 211.83 (b) The Company has also accounted for Milk subsidy amounting to Rs Nil million (31st March, 2020: 63.22 million) and export
Employee related liabilities 94.75 84.30 subsidy amounting to ` 4.32 million (31st March, 2020: ` 9.61 million) as Other Operating Income in Statement of Profit and
Trade payable for capital goods other than payable to Micro and Small Enterprises 83.76 152.27 Loss.
Directors remuneration payable (refer note 41) 8.05 2.77
(c) Revenue from operations- Geograhpical information ` million
Lease liability 25.71 27.75
Book overdrawn balance - 0.11
Particulars 2020-21 2019-20
Total 622.44 795.42
Within India 17,589.72 23,529.57
Note 23: Other current liabilities ` million Outside India 327.63 383.20
Particulars As at As at Total 17,917.35 23,912.77
31st March, 2021 31st March, 2020
(c) Performance obligation in respect of sale of goods is satisfied when control of the goods is transferred to the customer,
Statutory dues payables 201.94 91.80
generally on delivery of the goods and payment is generally due as per the terms of contract with customers.
Advances from customers 8.92 1.24
Total 210.86 93.04

162 163
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

Note 26: Other income ` million Note 29: Changes in inventories of finished goods, stock-in-trade and work-in-progress ` million

Particulars 2020-21 2019-20 Particulars 2020-21 2019-20

Interest income Inventories - Milk Products
Bank Deposits 8.68 13.73 Opening Stock:
Security Deposit 0.68 1.82 Finished goods 2,094.19 1,282.22
Others 11.10 9.52 Work-in progress 3,840.44 2,828.14
Exchange Fluctuation (net) 9.37 (5.15) 5,934.63 4,110.36
Sundry Balances written back 24.78 5.58 Less:
Net gain / (loss) on sale or fair valuation of investments 2.68 0.21 Closing Stock:
Miscellaneous Income 10.95 3.48 Finished goods 1,636.16 2,094.19
Total 68.24 29.19 Work-in progress 4,879.23 3,840.44
6,515.39 5,934.63
Note 27 : Cost of materials consumed ` million
Changes in inventories:
Particulars 2020-21 2019-20 Finished goods 458.03 (811.97)
Raw materials consumed Work-in progress (1,038.79) (1,012.30)
Opening Stock 94.46 120.14 (580.76) (1,824.27)
Add: Purchases 11,902.08 16,312.47
Note 30: Employee benefits expense ` million
11,996.54 16,432.61
Less: Closing Stock (98.71) (94.46) Particulars 2020-21 2019-20
11,897.83 16,338.15 Salaries and wages 675.10 829.56
Packing materials, stores spares and consumables consumed Contributions to provident and other funds (refer note 39) 32.30 41.19
Opening Stock 239.18 246.95 Gratuity (refer note 39) 11.16 12.38
Add: Purchases 1,128.35 1,188.51 Staff welfare expenses 35.69 44.02
1,367.53 1,435.46 Share-based Payments to employees (refer note 45) (0.98) 3.38
Less: Closing Stock (259.22) (239.18) Total 753.27 930.53
1,108.31 1,196.28
Note 31: Finance costs ` million
Total 13,006.14 17,534.43
Particulars 2020-21 2019-20
Note 28 : Purchase of Stock in trade ` million
Interest on debts and borrowings
Particulars 2020-21 2019-20 term loans 444.87 357.52
Milk products 975.31 2,220.30 Interest others 10.31 22.89
Total 975.31 2,220.30 Total 455.18 380.41

Note 32: Depreciation and amortisation expenses ` million

Particulars 2020-21 2019-20

Depreciation of property, plant and equipment 414.48 475.67
Amortisation of intangible assets 47.58 19.37
Depreciation of Right of Use assets 31.70 18.71
Total 493.76 513.75

164 165
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

Note 33: Other expenses ` million Note 34: Disclosure pursuant to Indian Accounting Standard (Ind AS) 12, Income Taxes

Particulars 2020-21 2019-20 (a) The major components of recognised deferred tax (liabilities)/assets arising on account of timing differences are as fol-
lows:
Transport, octroi and freight 669.41 825.76
For the year ended 31st March, 2021 ` million
Power and fuel 339.90 329.97
Rent (refer note 38) 164.62 109.12 Particulars Net balance Recognised in Recognised Net balance
Rates and taxes 91.76 90.44 1st April, 2020 profit or loss in OCI 31st March, 2021

Insurance 26.43 11.93 Deferred tax liabilities

Repairs and maintenance Property, plant and equipment and Intangible assets 323.47 (105.62) - 217.85

- Plant and machinery 37.53 51.42 Others 11.72 (11.72) - -

- Building 7.29 6.06 Sub-Total 335.19 (117.34) - 217.85

- Others 9.47 8.97 Deferred tax assets

Other factory expenses 120.41 193.81 Expected credit loss on financial assets 416.59 (160.60) - 255.99

Labour charges 154.73 161.80 Ind AS 116 1.11 (1.11) - (0.00)

Security charges 13.37 15.94 Expenses allowed on payment basis 19.00 (4.87) 1.92 16.05

Travelling and conveyance 21.71 54.45 Sub-Total 436.70 (166.58) 1.92 272.04

Legal and professional fees (refer note 41) 133.88 138.06 Minimum Alternate Tax (MAT) credit

Sales promotion, commission and advertisement 322.31 518.46 Recognised 21.17 (21.17) - -

Allowance for doubtful debts and advances (net) 126.89 95.10 Sub-Total 21.17 (21.17) - -

CSR expenses (refer note 44) 40.05 10.78 Net Deferred tax assets/(liabilities) 122.68 (70.41) 1.92 54.19

Miscellaneous expenses 216.26 312.60 For the year ended 31st March, 2020 ` million
Total 2,496.02 2,934.67
Particulars Net balance Recognised in Recognised Net balance
# Details of payments to auditors ` million 1st April, 2019 profit or loss in OCI 31st March, 2020
Deferred tax liabilities
Particulars 2020-21 2019-20
Property, plant and equipment and Intangible 270.55 52.92 - 323.47
Payment to the auditors (included in miscellaneous expenses)
assets
Auditors remuneration (excluding taxes):
Others 10.62 1.10 - 11.72
Audit fees 2.64 3.98
Sub-Total 281.17 54.02 - 335.19
Other services 0.53 0.75
Deferred tax assets
Certification work - -
Expected credit loss on financial assets 383.36 33.23 - 416.59
Re-imbursement of expenses - 0.03
Ind AS 116 - 0.57 0.54 1.11
Total 3.17 4.76
Expenses allowed on payment basis 17.94 2.99 (1.93) 19.00
Sub-Total 401.30 36.79 (1.39) 436.70
Minimum Alternate Tax (MAT) credit
Recognised 56.55 (35.38) - 21.17
Sub-Total 56.55 (35.38) - 21.17
Net Deferred tax assets/(liabilities) 176.68 (52.61) (1.39) 122.68

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Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

Note 34: Disclosure pursuant to Indian Accounting Standard (Ind AS) 12, Income Taxes (contd..) Note 35: Disclosure pursuant to Indian Accounting Standard (Ind AS) 107, Financial Instruments - Disclosures

(b) Income tax expense ` million A. Accounting classification and fair values

Particulars 2020-21 2019-20 The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their
Income tax expense levels in the fair value hierarchy. It does not include fair value information for financial assets and financial liabilities not
measured at fair value if the carrying amount is a reasonable approximation of fair value.
Current tax
Current tax on profits for the year 61.12 293.13 B. Measurement of fair value

Adjustments for current tax of earlier periods 80.60 - The fair values of the financial assets and liabilities are included at the amount at which the instrument could be exchanged
in a current transaction between willing parties, other than in a forced or liquidation sale.
Total 141.72 293.13
Deferred tax Fair value of cash and short-term deposits, trade and other short term receivables, trade payables, other current liabilities,
short term loans from banks and other financial institutions approximate their carrying amounts largely due to short term
Deferred tax charge/(credit) 49.24 17.23
maturities of these instruments.
MAT Credit entitlement 21.17 35.38
Total 70.41 52.61 C. Fair Value Hierarchy

Income tax expense 212.13 345.74 The fair value of financial instruments as referred to above have been classified into three categories depending on the inputs
used in the valuation technique. The hierarchy gives the highest priority to quoted prices in active markets for identical
(c) Reconciliation of effective tax rate: ` million assets or liabilities (Level 1 measurements) and lowest priority to unobservable inputs (Level 3 measurements).

Particulars 2020-21 2019-20 Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments,
Profit before tax 386.67 1,252.12 traded bonds that have quoted price. The fair value of all equity instruments which are traded in the stock exchanges is
Applicable tax rate* 25.17% 34.94% valued using the closing price as at the reporting period.

Expected income tax expense 97.32 437.54 Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques
Tax effect of adjustments to reconcile expected income tax expense to which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant
reported income tax expense: inputs required to fair value an instrument are observable, the instrument is included in level 2.

Effect of non deductible expenses (26.21) 46.12 Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.
Effect of tax exempt income (exemption under section 80IB) - (168.32) This is the case for unlisted equity securities included in level 3.
Effect of tax adjustment in respect of earlier years 80.60 - ` million
Effect of deferred tax in respect of earlier years - 0.57
As at 31st March, 2021 Carrying amount Fair value
Effect of tax rate change* 28.94 - FVTPL Amortised Total Level 1 Level 2 Level 3 Total
Others 31.48 29.83 Cost
Financial assets
Income tax expense 212.13 345.74
Other non-current financial assets
Effective tax rate 54.86% 27.61% Investments - mutual funds 8.18 - 8.18 8.18 - - 8.18
Investments - Others 622.66 - 622.66 - - 622.66 622.66
*The Company has elected to exercise the option permitted under Section 115BAA of the Income tax Act, 1961 as introduced
Others
by the Taxation Laws (Amendment) Act, 2019. Accordingly, the Company has recognised provision for income tax for year
Other financial assets (non current) - 120.71 120.71 - - - -
ended 31st March, 2021.
Trade receivable - 1,559.15 1,559.15 - - - -
Cash and cash equivalents - 65.34 65.34 - - - -
(d) Amounts recognised in Other comprehensive income ` million
Other bank balances - 117.06 117.06 - - - -
Particulars 2020-21 2019-20 Total 630.84 1,862.26 2,493.10 8.18 - 622.66 630.84
Financial liabilities
Before Tax Net of Before Tax Net of
tax (Expense) tax tax (Expense) tax Borrowings - non-current - 208.63 208.63 - - - -
/Benefit /Benefit Borrowings - current - 3,125.60 3,125.60 - - - -
Trade payables - 2,888.07 2,888.07 - - - -
Items that will not be reclassified to profit
Current maturities of long - term - 302.18 302.18 - - - -
or loss
borrowings
Remeasurement of the defined benefit plans 7.63 (1.92) 5.71 5.54 (1.93) 3.61 Other financial liabilities - 320.26 320.26 - - - -
Total - 6,844.74 6,844.74 - - - -

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 Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

` million Trade receivables are typically unsecured and are derived from revenue earned from customers located in India. Credit risk
has always been managed by the Company through credit approvals, establishing credit limits and continuously monitoring
As at 31 March, 2020
st
Carrying amount Fair value
the creditworthiness of customers to which the Company grants credit terms in the normal course of business. In monitoring
FVTPL Amortised Total Level 1 Level 2 Level 3 Total
customer credit risk, customers are grouped according to their credit characteristics, including whether they are General
Cost
trade, Modern trade, Institutional and Horeca customers. Outstanding customers are regularly monitored.
Financial assets
Other non-current financial assets Summary of the Company’s exposure to credit risk by age of the outstanding from various customers is as follows:
Investments - mutual funds 5.50 - 5.50 5.50 - - 5.50
Investments - Others 622.66 - 622.66 - - 622.66 622.66 ` million
Others Particulars 31st March, 2021 31st March, 2020
Other financial assets (non current) - 120.96 120.96 - - - -
Outstanding for a period not exceeding six months 1,475.53 2,883.13
Trade receivable - 2,994.85 2,994.85 - - - -
Outstanding for a period exceeding six months 1,054.53 1,257.67
Cash and cash equivalents - 213.15 213.15 - - - -
Other bank balances - 54.55 54.55 - - - - Gross trade receivables 2,530.06 4,140.80
Total 628.16 3,383.51 4,011.67 5.50 - 622.66 628.16 Less: Provision for doubtful debts (970.91) (1,145.95)
Financial liabilities Net trade receivables 1,559.15 2,994.85
Borrowings - non-current - 481.48 481.48 - - - -
Borrowings - current - 3,167.10 3,167.10 - - - - On account of adoption of Ind AS 109, the Company uses expected credit loss model to assess the impairment loss. The
Trade payables - 2,814.29 2,814.29 - - - - Company computes the expected credit loss allowance as per simplified approch for trade receivables based on available
external and internal credit risk factors such as the ageing of its dues, market information about the customer and the
Current maturities of long - term - 302.28 302.28 - - - -
Company’s historical experience for customers. The Company has used a practical expedient by computing the expected
borrowings
credit loss allowance for trade receivables based on a provision matrix. The provision matrix takes into account historical
Other financial liabilities - 493.14 493.14 - - - -
credit loss experience and is based on the ageing of the receivable days and the rates as given in the provision matrix.
Total - 7,258.29 7,258.29 - - - -
The movement in the loss allowance in respect of trade receivables is as follows
Note 36: Financial Risk Management
Risk management framework Loss allowance on trade receivables Amount in ` Million
The Company has in place a mechanism to inform the Board about the risk assessment and minimization procedures and periodical Balance as at 1st April, 2019 1,052.95
review to ensure that management controls risk through means of a properly defined framework. The Company has formulated
Add: Impairment loss recognised 93.00
and adopted Risk Management Policy to prescribe risk assessment, management, reporting and disclosure requirements of the
Company. Less: Write-off of bad debts -
Balance as at 31 March, 2020
st
1,145.95
The Company’s audit committee also oversees how management monitors compliance with the Company’s risk management
Add: Impairment loss recognised 122.33
policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the
Company. The audit committee is assisted in its oversight role by internal audit. Internal audit undertakes both regular and ad hoc Less: Write-off of bad debts (297.37)
reviews of risk management controls and procedures, the results of which are reported to the audit committee. Balance as at 31 March, 2021
st
970.91

The Company’s principal financial liabilities, other than derivatives, comprises of borrowings, trade and other payables. The main Note 36: Financial Risk Management
purpose of these financial liabilities is to finance the Company’s operations. The Company’s principal financial assets include
(B)
Liquidity risk
investments in equity shares, loans, trade and other receivables, and cash and cash equivalents that the Company derives directly
Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial
from its operations. The Company also holds FVTOCI/FVTPL investments.
liabilities that are settled by delivering cash or another financial asset. The Company’s approach to managing liquidity
The Company’s activities expose it to market risk, liquidity risk and credit risk. The Company’s primary focus is to foresee the is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due. Management
unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance. monitors rolling forecasts of the Company’s liquidity position (comprising the undrawn borrowing facilities) and cash and
cash equivalents on the basis of expected cash flows. The Company’s objective is to maintain a balance between continuity
This note explains the sources of risk to which the Company is exposed to and how the entity manages the risk. of funding and flexibility through the use of bank overdraft/ cash credit facility. The Company also monitors the level of
expected cash inflows on trade receivables together with expected cash outflows on trade payables and other financial
(A) Credit risk
liabilities. The Company has access to a sufficient sources of short term funding with existing lenders that could be arrange
Trade and Other receivables upon should there be need.
Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet
its contractual obligations, and arises principally from the Company’s trade and other receivables. The carrying amounts of (i) Maturities of financial liabilities
financial assets represent the maximum credit risk exposure. The following are the remaining contractual maturities of financial liabilities at the reporting date. The amounts are gross and
undiscounted.

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

` million (a) The Company unhedged exposure to foreign currency risk at the end of the reporting period are as follows

Contractual maturities of financial Carrying value 1 year or less 1-2 years 2- 5 years Total ` million
liabilities 31st March, 2021
Sr no Particulars Currency As at 31st March, 2021 As at 31st March, 2020
Non-derivatives financial liabilities
Amount
Borrowings - non-current 510.81 302.18 125.08 83.55 510.81
A Financial assets INR Foreign currency INR Foreign currency
Borrowings - current 3,125.60 3,125.60 - - 3,125.60
(i) Trade receivables USD 34.19 0.47 11.17 0.15
Trade payables 2,888.07 2,888.07 - - 2,888.07
B Financial liabilities
Lease rent payable 109.75 25.71 28.68 55.36 109.75
(i) Foreign currency loan
Other financial liabilities 294.55 294.55 - - 294.55
Bank loan USD 177.10 2.41 361.40 4.79
Total non-derivative liabilities 6928.78 6636.11 153.76 138.91 6928.78
Interest payable USD 2.32 0.03 6.11 0.08
` million (ii) Trade payables USD 0.08 0.00 8.74 0.12
Contractual maturities of financial Carrying value 1 year or less 1-2 years 2- 5 years Total EURO 10.08 0.12 39.11 0.47
liabilities 31st March, 2020 AUD 2.50 0.05 1.50 0.03
Non-derivatives financial liabilities GBP 0.07 0.00 0.06 0.00
Borrowings - non-current 783.76 272.96 302.18 208.62 783.76
(b)
Sensitivity
Borrowings - current 3,167.10 3,167.10 - - 3,167.10
Trade payables 2,814.29 2,814.29 - - 2,814.29 A reasonably possible strengthening (weakening) of the Indian Rupee against various currency mentioned in the table below
Lease rent payable 137.50 27.75 25.71 84.04 137.50 as at 31st March would have affected the measurement of financial instruments denominated in foreign currency and affected
equity and profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular interest
Other financial liabilities 465.39 465.39 - - 465.39
rates, remain constant and ignores any impact of forecast sales and purchases.
Total non-derivative liabilities 7,368.04 6,747.49 327.89 292.66 7,368.04
Profit / (loss) before tax gain / (loss) Equity, gross of tax
(C)
Market risk
Strengthening Weakening Increased (Decreased)
Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from adverse changes in 31st March, 2021
market rates and prices (such as interest rates and foreign currency exchange rates) or in the price of market risk-sensitive Effect in INR
instruments as a result of such adverse changes in market rates and prices. Market risk is attributable to all market risk- 1% movement
sensitive financial instruments, all foreign currency receivables and payables and all short-term and long-term debt. The USD 1.45 (1.45) 1.45 (1.45)
Company is exposed to market risk primarily related to foreign exchange rate risk and interest rate risk.
EUR 0.10 (0.10) 0.10 (0.10)
(i)
Foreign currency risk AUD 0.03 (0.03) 0.03 (0.03)
GBP 0.00 (0.00) 0.00 (0.00)
The Company is subject to risk of changes in foreign currency values that impact costs of imported raw material and import
31st March, 2020
of equipment for expansion of plants, primarily with respect to USD and EURO. The Company’s business model incorporates
assumptions on currency risks and ensures any exposure is covered through the normal business operations. Effect in INR
1% movement
The Company has not entered into any derivative transactions during the year and there were no derivative transactions USD 3.65 (3.65) 3.65 (3.65)
outstanding as on 31st March, 2021, 31st March, 2020. EUR 0.39 (0.39) 0.39 (0.39)
AUD 0.01 (0.01) 0.01 (0.01)
GBP 0.00 (0.00) 0.00 (0.00)

(i) Cash flow and fair value interest rate risk

Interest rate risk is the risk that the fair value or future cashflows of a financial instrument will fluctuate because of
changes in market interest rates. The Company main interest rate risk arises from long-term borrowings with variable
rates, which expose the Company to cash flow interest rate risk.

The company’s borrowings are carried at amortised cost. They are therefore not subject to interest rate risk as defined in
Ind AS 107, Financial Instruments: Disclosures, since neither the carrying amount nor the future cash flows will fluctuate
because of a change in market interest rates.

172 173
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

(a) Interest rate risk exposure The Company’s adjusted net debt to equity ratio are as follows.

Company’s interest rate risk arises from borrowings. The interest rate profile of the Company’s interestbearing financial ` million
instruments as reported to the management of the Company is as follows.
Particulars 31st March, 2021 31st March, 2020
Particulars 31 March, 2021
st
31 March, 2020
st
Borrowings
Fixed rate instruments and variable rate instruments Long term and Short term borrowings 3,334.23 3,648.58
Financial assets Current maturities of Long term borrowings 302.18 302.28
Bank deposits 145.68 182.29 Less: Cash and cash equivalents (211.02) (395.44)
Total 145.68 182.29 Adjusted net debt 3,425.39 3,555.42
Financial liabilities Total Equity 9,198.13 9,060.92
Non-current borrowings 208.63 481.48 Adjusted net debt to equity ratio 0.37 0.39
Current maturities of non-current borrowings 302.18 302.28
In order to achieve this overall objective, the Company’s capital management, amongst other things, aims to ensure that it meets
Current borrowings 3125.60 3167.10 financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. There have
Total 3636.41 3950.86 been no breaches in the financial covenants of any interest-bearing loans and borrowing in the current period.

(b) Cash flow sensitivity analysis for variable-rate instruments No changes were made in the objectives, policies or processes for managing capital of the Company during the current and
The sensitivity analysis below has been determined based on the exposure to interest rates at the end of the reporting previous year.
period. For floating rate liabilities, the analysis is prepared assuming that the amount of the liability as at the end of the
Note 38: Disclosure pursuant to Indian Accounting Standard (Ind AS) 116, Leases
reporting period was outstanding for the whole year. A 100 basis point increase or decrease is used when reporting
interest rate risk internally to key management personnel and represents Management’s assessment of the reasonably The company has entered into commercial leases for taking office spaces on lease. These leases have an average term of
possible change in interest rates. This analysis assumes that all other variables, in particular foreign currency exchange three to five years with renewal option and escalation clauses included in the agreements. There are no restrictions placed
rates, remain constant. upon the Company by entering into these leases. The Company has not given any sub lease during the year. Some of the
lease arrangements also include a non-cancellable period.
Impact on profit /(loss) - Increase /
A. Right-of-Use assets ` million
(Decrease) in profit
Particulars 31st March, 2021 31st March, 2020 Carrying Value 2020-21 2019-20
Interest rates – increase by 100 basis points * (36.15) (39.23) Opening Balance 153.52 -
Interest rates – decrease by 100 basis points * 36.15 39.23 Additions - 153.52
Disposal / derecognized during the year - -
* Holding all other variables constant
Closing Balance 153.52 153.52
Note 37: Capital Management
` million
For the purpose of the Company’s capital management, capital includes issued equity capital and all other equity reserves
attributable to the equity holders of the Company. The primary objective of the Company’s capital management is to safeguard Accumulated depreciation 2020-21 2019-20
the Company’s ability to remain as a going concern and maximise the shareholder value. Opening Balance 18.71 -

The Company manages its capital structure and makes adjustments in light of changes in economic conditions, annual operating Additions 31.70 18.71
plans, long term and other strategic plans and the requirements of the financial covenants. To maintain or adjust the capital Disposal / derecognized during the year - -
structure, the Company may adjust its dividend payment (refer note 16) ratio to shareholders, return capital to shareholders or Closing Balance 50.41 18.71
issue fresh shares.
B. Lease Liabilities ` million
The Company monitors capital using a ratio of ‘adjusted net debt’ to ‘equity’. For this purpose, adjusted net debt is defined as
liabilities, comprising interest-bearing loans and borrowings less cash and cash equivalents. Equity comprises all components of Particulars 2020-21 2019-20
equity including share premium and all other equity reserves attributable to the equity share holders. Opening Balance 137.50 -
Addition - 153.52
Accredition of interest 13.66 5.03
Payments 41.41 21.05
Total 109.75 137.50

174 175
 Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

` million These plans typically expose the Company to actuarial risks such as: inherent interest rate risk, longevity risk and salary risk.

Lease liabilities 2020-21 2019-20

Interest Rate Risk The defined benefit obligation calculated uses a discount rate based in government bonds. If bond
Current 25.71 27.75 yield fall, the defined benefit obligation will tend to increase.
Non - Current 84.04 109.75 Longevity Risk `The present value of the defined benefit plan liability is calculated by reference to the best estimate
Total 109.75 137.50 of the mortality of plan participants both during and after their employment. An increase in the life
expectancy of the plan participants will increase the plan’s liability.
C. Disclosure for minimum lease rentals payable under non-cancellable lease agreements are as below:
Salary Risk Higher than expected increases in salary will increase the defined benefit obligation.
` million
Based on the actuarial valuation obtained in respect of gratuity, the table below sets out the status of the gratuity plan and
Lease liabilities 2020-21 2019-20 the amounts recognized in the Company’s financial statements as at the balance sheet date.
Not later than one year 36.51 41.41
` million
Later than one year and not later than five years 97.35 133.86
Defined benefit plans 2020-21 2019-20
Total 133.86 175.27 I Expenses recognised in statement of profit and loss during the year:
Current Service Cost 8.95 10.15
D. Amounts to be recognised in Statement of Profit and Loss for the year ended 31st March, 2021
Past Service Cost - 0.00
` million Expected return on plan assets (1.42) (1.43)
Interest cost on benefit obligation 3.63 3.66
Particulars 2020-21 2019-20
Total Expenses 11.16 12.38
Depreciation expense of Right-of-Use assets 31.70 18.71
II Expenses recognised in OCI
Interest expense on lease liabilities 13.66 5.03 Actuarial (Gain) / Loss due to Demographic Assumption changes in DBO - 0.00
Total 45.36 23.74 Actuarial (Gain) / Losses due to Financial Assumption changes in DBO 0.08 2.16
Actuarial (Gain)/ Losses due to Experience on DBO (7.91) (8.05)
Note 39: Disclosure pursuant to Indian Accounting Standard (Ind AS) 19, Employee Benefits Return on Plan Assets (Greater) / Less than Disount rate 0.20 0.36
A. Defined contribution plan- Provident Fund/Employee State Insurance Total Expenses (7.63) (5.53)
The Company has recognised an amount of ` 32.32 million as expenses under the Defined Contribution Plans in the Statement III Net Asset /(Liability) recognised as at balance sheet date:
of Profit & Loss as below: Present value of defined benefit obligation (62.99) (62.75)
Fair Value of Plan Assets 25.84 22.13
Benefit/Contribution to 2020-21 2019-20 Funded status [Surplus/(Deficit)] (37.15) (40.62)
Provident Fund 27.23 34.23 IV Movements in present value of defined benefit obligation
National Pension Scheme 0.60 0.98 Present value of defined benefit obligation at the beginning of the year 62.75 56.90
Current Service Cost 8.95 10.15
Employees State Insurance 4.47 5.94
Past service cost - -
Labour Welfare Fund 0.02 0.03
Interest Cost 3.63 3.66
Total 32.32 41.18 Actuarial (Gain)/Loss (7.83) (5.89)
Benefits paid (4.50) (2.07)
B. Defined Benefit Plan- Gratuity
Present value of defined benefit obligation at the end of the year 63.00 62.75
The Company operates a defined benefit gratuity plan, which is governed by the Payment of Gratuity Act, 1972. The plan
V Movements in fair value of the plan assets
entitles an employee who has completed at least five years of continuous service, to gratuity at the rate of fifteen days wages
Opening fair value of plan assets 22.13 20.04
for every completed year of service or part thereof in excess of six months, based on the last drawn wage by the employee
Expected returns on Plan Assets 1.42 1.44
concerned.
Actuarial (Gain)/Loss on Plan assets (0.20) (0.36)
The defined benefit gratuity plan is administered by a Trust that is legally separate from the Company. The gratuity plan is a Contribution from Employer 6.99 2.99
funded plan, managed by Life Insurance Company (“LIC”) and the Company’s makes annual contributions to Group Gratuity Benefits paid (4.50) (1.98)
cum Life Assurance Scheme managed by LIC. Closing fair value of the plan asset 25.84 22.13
VI Maturity profile of defined benefit obligation
The most recent actuarial valuation of the defined benefit obligation was carried out as at 31st March, 2021. The present value
Within the next 12 months (next annual reporting period) 11.75 12.13
of the defined benefit obligations and the related current service cost and past service costs were measured using Projected
Between 1 to 5 years 33.16 32.67
Unit Credit Method.
Between 6 to 10 years 23.20 23.16

176 177
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

` million Demographic Assumptions As at As at

Defined benefit plans 2020-21 2019-20 31st March, 2021 31st March, 2020
VII Quantitative sensitivity analysis for significant assumptions is as below: Mortality IALM (2012-14) IALM (2012-14)
1 Increase/(decrease) on present value of defined benefit obligation at the Ultimate Ultimate
end of the year
Employee Turnover 14.00% 14.00%
(i) +100 basis points increase in discount rate -4.40% -4.53%
Leave Availment Ratio 15% for two years 15% for two years
(i) -100 basis points decrease in discount rate 4.88% 5.01%
(iii) +100 basis points increase in rate of salary increase 4.70% 4.88% Note 40: Contingent liabilities and Commitments ` million
(iv) -100 basis points decrease in rate of salary increase -4.36% -4.55%
Sr no Particulars As at As at
2 Sensitivity analysis method 31st March, 2021 31st March, 2020
(A) Contingent liabilities
Sensitivity analysisis performed by varying a single parameter while keeping all the other parameters unchanged.
a) Sales tax matter under litigation in respect of Company for FY 2009-10, 63.40 58.70
Sensitivity analysis fails to focus on the interrelationship between underlying parameters. Hence, the results may vary if
F.Y. 2010-11 and FY 2016-17 for pending forms and lower allowance on account
two or more variables are changed simultaneously. The method used does not indicate anything about the likelihood of
of Central Quantum Benefit, against which appeal has been filed.
change in any parameter and the extent of the change if any.
b) Claim against the Company not acknowledge as debt in relation to claim made 70.68 70.68
VIII Actuarial Assumptions: 2020-21 2019-20 by France International Trade, Rennes, vide Special Civil Suit No. 692/2012
Discount rate 6.37% 6.40% dated 7th March, 2012 in the Court of Honourable Civil Judge, Senior Division,
Expected return on assets 6.37% 6.40% Pune for damaged goods supplied by the Company. The amount includes
Expected rate of salary increase 6.00% p.a 6.00% p.a interest of ` 20.37 Million
Withdrawal rate 14.00% 14.00% c) Goods and Service Tax matter under litigation in respect of Company for 7.85 7.85
Mortality Indian Assured Indian Assured FY 2017-18
Lives Mortality Lives Mortality d) Goods and Service Tax matter under litigation in respect of Company for 59.70 -
(2012-14) Ultimate (2012-14) Ultimate FY 2017-18

a) The rate used to discount post-employment benefit obligations is determined by reference to market yields at the end e) Sales Tax matter under litigation in respect of Company for FY 2017-18 for 6.50 1.12
of the reporting period on government bonds. pending forms
f) Income tax matter under litigation for the AY 2013-14 to AY 2019-20 38.82 11.83
b) The estimates of future salary increases considered in the actuarial valuation take account of inflation, seniority,
g) Corporate Guarantee given by the Company for Loan taken by suppliers from Bank 200.00 200.00
promotion and other relevant factors, such as supply and demand in the employment market.
(B) Commitments
c) The gratuity fund is managed by life insurance company, details of fund invested by insurer are not available with "Estimated amount of contracts remaining to be executed on capital account 34.74 94.84
company. and not provided for (net of advances)"
d) The Company expects to make a contribution of ` 11.75 Million to the defined benefit plans (gratuity - funded) during the Notes:
next financial year.
i. The Company is involved in other disputes, lawsuits, claims, inquiries and proceedings including commercial matters that
e) The average duration of the defined benefit plan obligation at the end of the reporting period is 6.48 years. arise from time to time in the ordinary course of business. The Company believes that there are no such pending matters that
are expected to have any material adverse effect on its financial statements in any given accounting period.
C. Annual Leave and Sick Leave (compensated absence)
The liability towards compensated absences (annual leave and sick leave) for the year ended 31st March, 2021 based on ii. The amounts shown above represent the best possible estimates of pending litigations/disputes arrived at on the basis of
actuarial valuation carried out by using Projected Unit Credit method resulted in increase in liability by ` 0.39 million. available information. The above do not include potential risks/demands, if any, for ongoing issues where no claims have
(Previous Year- decreased by ` 9.10 million) been made against the Company.

Financial Assumptions As at As at iii. Pending resolution of the respective proceedings, it is not practicable for the Company to estimate the timings of cash
31st March, 2021 31st March, 2020 outflows, if any, in respect of the above as it is determinable only on receipt of judgements/ decisions pending with various
forums/ authorities.
Discount Rate 6.37% 6.40%
Basic salary increases allowing for Price inflation 6.00% 6.00%

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

Note 41: Disclosure pursuant to Indian Accounting Standard (Ind AS) 24, Related Party Disclosures ` million
Details of related parties: Particulars 2020-21 2019-20
Description of relationship Name of the related party Akshali Shah 3.48 3.48
Poojan Shah 0.56 0.56
A. Enterprise where company exercise control
Stavan Shah 0.09 -
Subsidiary Bhagyalaxmi Dairy Farms Private Limited
Rent Payment
B. Other related parties
Bhagyalaxmi Dairy Farms Private Limited 6.60 6.60
Key Management Personnel (KMP) Mr. Devendra Shah – Chairman Devendra Shah 3.24 3.37
Mr. Pritam Shah – Director Pritam Shah 0.30 0.43
Mr. Venkat Shankar - CEO (till June 29, 2020) Priti Shah 0.24 0.37
Mr. Shashikant Dalmia - CFO (w.e.f. Aug 2, 2019) Netra Shah 0.24 0.37

Mr. Vimal Agarwal - CFO (till July 19, 2019) Reimbursment of expenses KMP
Devendra Shah 0.23 -
Mrs. Rachana Sanganeria - CS
Director sitting fees
Mr. Nitin R. Dhavalikar - Director
Nitin R. Dhavalikar 1.10 1.10
Ms. Radhika Dudhat - Director Radhika Dudhat 0.70 0.70
Mr. Narendra Ambwani - Director Narendra Ambwani 0.90 0.80
Mr. Ramesh Chandak - Director Ramesh Chandak 1.00 1.10
Mr. B. M. Vyas - Director Consultancy fee including out of pocket expenses
Mr. Sunil Goyal - Director (till May 25, 2020) B.M. Vyas 8.40 8.40
SBM Advisors LLP - 0.91
Advances received/(paid) (Net)
Relative of Key Management Personnel Late Mr. Parag Shah
Bhagyalaxmi Dairy Farms Private Limited - (175.09)
Mr. Prakash Shah
* The remuneration to the key managerial personnel and their relatives (if any) comprises of only short term benefits and does not
Miss. Akshali Shah include the provisions made for gratuity and leave benefits, as they are determined on an actuarial basis for the Company as a
Mr. Poojan Shah whole. Further, the remuneration to key managerial personnel does not include employee stock compensation expense.
Mrs. Priti Shah
Details of balances outstanding at the year end ` million
Mrs. Netra Shah
Particulars As at As at
Mr. Stavan Shah 31st March, 2021 31st March, 2020
Entity in which KMP can exercise significant influence Bharat Trading Company Amount Payable to
SBM Advisors LLP Devendra Shah 4.11 1.50
Pritam Shah 3.94 1.26
Details of related party transactions For the year ended on 31st March, 2021 : Venkat Shankar - 3.56
` million Shashikant Dalmia 0.66 1.03
Particulars 2020-21 2019-20 Rachana Sanganeria 0.20 0.20
Purchase of Goods B.M. Vyas 1.54 0.75
Bhagyalaxmi Dairy Farms Private Limited 93.33 218.55 Akshali Shah 0.29 0.29
Sale of Goods Poojan Shah 0.05 0.05
Bhagyalaxmi Dairy Farms Private Limited 19.93 33.59 Netra Shah 0.94 1.09
Remuneration to Key Management Personnel and their relatives * Priti Shah 0.71 0.49
Devendra Shah 24.00 24.00 Stavan Shah 0.05 -
Pritam Shah 24.00 24.00 Personal guarantee issued by
Venkat Shankar 4.87 14.92 Devendra Shah, Pritam Shah, Parag Shah, Prakash Shah, Netra Shah, and Priti Shah 6,396.30 5,779.70
Vimal Agarwal - 5.69 Receivable/(payable)
Shashikant Dalmia 7.09 4.60 Bhagyalaxmi Dairy Farms Private Limited 35.90 30.07

Rachana Sanganeria 2.37 2.05

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

Note 42: Disclosure pursuant to Indian Accounting Standard (Ind AS) 33, Earnings Per Share ` million Note 45: Disclosure pursuant to Indian Accounting Standard (Ind AS) 102, Share-Based Payments

Particulars 2020-21 2019-20 The Board of Directors constituted the equity settled Employee Stock Option Scheme (“ESOS 2015”) vide its resolutions dated
February 27, 2015 and April 21, 2015 for issue of 696,339 stock options to the key employees of the Company, which has been
Profit/(Loss) attributable to Equity shareholders (` in Million)(A) 174.54 906.38
further approved in the Company’s Extra ordinary General meeting dated April 3, 2015 and May 16, 2015.
Weighted average number of Equity shares for basic EPS (B) 8,39,38,567 8,39,38,567
Effect of Dilution : Pursuant to the above scheme, the Board of Directors vide its circular resolution dated September 3, 2015, approved grant of
227,000 stock options to its employees on September 4, 2015.
Weighted average number of Treasury shares held through ESOP Trust 1,76,015 1,76,015
Weighted average number of Equity shares adjusted for the effect of dilution (C ) 8,41,14,582 8,41,14,582 The Company has in its Board Meeting dated November 01, 2018 approved the grant of 166,015 options to the eligible employees
Basic EPS (Amount in `) (A/B) 2.08 10.80 of the Company at a fair market value of ` 258.90 (Two Hundred Fifty Eight Rupees and Ninety Paise) per option (based on the
closing market price of ` 258.90 of the Company’s shares on NSE as on October 31, 2018) under the Parag Milk Foods Limited
Diluted EPS (Amount in `) (A/C) 2.08 10.78
– Employee Stock Option Scheme, 2018 - “ESOS 2018” (erstwhile ESOS2015 under the ESOS Scheme 2015, renamed as ESOS
Basic: Basic earnings per share is calculated by dividing the profit attributable to equity shareholders of the Company by the Scheme 2018, besides renaming of the scheme to ESOS 2018, the other terms and conditions will remain the same as stated in
weighted average number of equity shares outstanding during the year, excluding equity shares held as treasury shares. ESOS 2015.) The Board of Directors approved fresh grant of ESOS options 1,66,015 at a fair market value of ` 258.90 per option
under Parag Milk Foods Limited - Employee Stock Option Scheme - 2018 “ESOS 2018” (erstwhile ESOS-2015 under the SSOS
Diluted: Diluted earnings per share is calculated by adjusting the weighted average number of equity shares outstanding during scheme 201, renamed as ESOS scheme 2018, besides remaining of the scheme to ESOS 2018 the oher terms and conditions will
the year for assumed conversion of all dilutive potential equity shares. Employee share options are dilutive potential equity shares remain the same as stated in ESOS 2015.
for the Company.
According to ESOS 2018, the employee selected will be entitled to stock options, subject to satisfaction of the prescribed vesting
Note 43: Disclosure pursuant to Indian Accounting Standard (Ind AS) 108, Operating Segments conditions in the scheme. The contractual life (comprising the vesting period and the exercise period) of options granted is 3
The Managing Director of the Company acts as the chief operating decision maker (CODM) of the Company in accordance with Indian years. The other relevant terms of the grant are as below. The fair valuation of the option have been computed as per the black
Accounting Standard (Ind AS) 108, Operating Segments, for purpose of assessing the financial performance and position of the scholes pricing model.
Company, and make strategic decisions. The Company’s business activities are mainly related to processing of milk and
manufacturing of milk related products, which are primarily assessed as a single reportable operating segment in accordance Vesting Period 1 years
with Ind AS 108 by the CODM. The information based on geographical areas in relation to revenue and non-current assets are as Exercise Period 2 Years
below: Expected Life 2 Years

(a) Revenue from operations ` million Exercise Price ` 258.90

Particulars 2020-21 2019-20 Fair value using Black Scholes model on grant date ` 71.14

Within India 17,589.72 23,529.57 Date of grant 1-Nov-18

Outside India 327.63 383.20 The details of activity under ESOS 2018 are summarized below:
Total 17,917.35 23,912.77
Particulars As at 31st March, 2021 As at 31st March, 2020
(b) Non-current operating assets
No. of options WAEP (`) No. of options WAEP (`)
All non–current assets other than financial instruments, deferred tax assets of the company are located in India
Outstanding at the beginning of the year 1,15,765 258.90 1,66,015 258.90
(c) The Company does not have revenues from transactions with a single external customer amount to 10 per cent or more of Granted during the year - - -
the total revenues. Forfeited/lapsed during the year 13,726 258.90 50,250 258.90

Note 44: Disclosure on CSR Expense ` million Exercised during the year - - -
Exercisable/ Vested during the year - - - -
Particulars 2020-21 2019-20 Outstanding at the end of the year: 1,02,039 258.90 1,15,765 258.90
a) Gross amount required to be spent by the Company during the period. 28.24 21.74 of which Options vested and exercisable at the - - - -
b) Amount spent during the year on: end of the year
(i) Construction/acquisition of any asset - -
(ii) On purposes other than (i) above
In Cash 40.05 10.78
Yet To be Paid in Cash - 10.96

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Standalone Financial Statements Notes to Standalone Financial Statements

for the year ended 31st March, 2021 for the year ended 31st March, 2021

` million Note 47:

The Code on Social Security, 2020 (‘Code’) received the Indian Parliament approval and Presidential assent in September 2020.
Particulars As at As at
The Code once made effective would impact the employee benefits during employment as well as post employment benefits. The
31 March, 2021
st
31 March, 2020
st
implementation of the Code has been deferred by the Central Government on 30th March, 2021 and the date from which the code
Dividend yield (%) will be effective is yet to be notified. The impact assessment of the Code will be done by the Company once the same is made is
Expected volatility 34.95% 34.95% effective.
Risk-free interest rate 7.40% 7.40% Note 48:
Weighted average share price 258.90 258.90 Based on its initial assessment, the Management does not expect any significant impact on the business of the Company due to
Exercise price (`) 258.90 258.90 the COVID-19 pandemic. The Company has evaluated the possible effects of COVID-19 on the carrying amounts of property, plant
and equipment, inventory and trade receivables basis the internal and external sources of information and determined, exercising
Expected life of options granted in years 2 2
reasonable estimates and judgements, that the carrying amounts of these assets are recoverable. Having regard to the above,
Life of option remaining in months 0 7 and the Company’s operating efficiency and gradually improving liquidity position, there is no material uncertainty in meeting the
financial obligations over the foreseeable future.
The expected option life is assumed to be approximately half way between the option vesting period and contractual term of the
option. Since the vesting period and contractual term is different, the expected life of the option will be different. The expected Note 49:
option life is calculated as Year to Vesting + (Contractual Option Term) /2. Volatility was calculated using standard deviation of Previous year figures have been regrouped wherever necessary.
daily change in stock price. The historical period taken into account match the expected life of the option.
Signatures to Notes 1 to 49
Expenses Arising from share based payment transactions
Total expenses arising from share-based payment transactions recognised in profit or loss as part of employee benefit expense As per our report attached
were as follows: SHARP & TANNAN For and on behalf of the Board of Directors
Chartered Accountants
` million Firm’s Registration No. 109982W
by the hand of
Particulars 2020-21 2019-20
Employee option Plans (0.98) 3.38
Edwin P. Augustine Devendra Shah Pritam Shah
Note 46: Disclosure pursuant to Indian Accounting Standard (Ind AS) 27, Separate Financial Statements Partner Chairman Managing Director
Membership No. 043385 DIN: 01127319 DIN: 01127247
Investments in following subsidiary companies are accounted at cost:

Name of the subsidiary company Principal place of Proportion of direct ownership Proportion of direct ownership Shashikant Dalmia Rachana Sanganeria
Chief Financial Officer Company Secretary & Compliance Officer
business as on 31st March, 2021 as on 31st March, 2020
Membership No. ACS10280
Bhagyalaxmi Dairy Farm Private India 100% 100%
Place: Mumbai Place: Manchar
Limited Date: 12th June, 2021 Date: 12th June, 2021

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

INDEPENDENT AUDITOR’S REPORT management of the Group with trade receivables for
realization of money;
accounting policies; making judgments and estimates that
are reasonable and prudent; and design, implementation
and maintenance of adequate internal financial controls,
• We have verified open invoices duly accepted by that were operating effectively for ensuring the accuracy
customers in order to ensure existence of trade and completeness of the accounting records, relevant to the
To the Members of Parag Milk Foods Limited We have determined the matters described below to be the receivables; preparation and presentation of the consolidated financial
key audit matters to be communicated in our report.
Report on the Audit of the Consolidated Financial Statements statements that give a true and fair view and are free from
• We have verified the appropriateness of judgments
Valuation of Trade Receivables material misstatement, whether due to fraud or error,
Opinion regarding provisions for trade receivables and
which have been used for the purpose of preparation of the
(Refer to Note 3(e)(i) ‘Accounting policy on impairment of assessment as to whether these provisions
We have audited the accompanying consolidated financial consolidated financial statements by the Directors of the
financial assets’, note 12 ‘Trade receivables’ and note 38A were calculated in accordance with the Group’s
statements of Parag Milk Foods Limited (the ‘Holding Holding Company, as aforesaid.
‘Financial Risk Management - Credit Risk’ to the consolidated provisioning policies.
Company’) and its subsidiary (Holding Company and its
subsidiary together referred to as the ‘Group’), which comprise financial statements). In preparing the consolidated financial statements, respective
• We have conducted discussion with management
the Consolidated Balance Sheet as at 31st March, 2021, and the Board of Directors of the Companies included in the Group are
As at 31st March, 2021, the trade receivables balance excluding as to the recoverability of the old outstanding and
Consolidated Statement of Profit and Loss, the Consolidated responsible for assessing the ability of the Group to continue
provisions included in note 12 were Rs. 2,581.07 million. corroborating management’s explanations with
Statement of Changes in Equity and the Consolidated as a going concern, disclosing, as applicable, matters related
underlying documentation and correspondence
Statement of Cash Flows for the year then ended, and notes We have identified valuation of trade receivables as a key audit to going concern and using the going concern basis of
with the customers.
to the Consolidated financial statements, including a summary matter on account of the significant management judgment accounting unless Board of Directors either intends to liquidate
of the significant accounting policies and other explanatory involved with respect to the recoverability and existence Information Other than the Consolidated Financial State- the Group or to cease operations, or has no realistic alternative
information (hereinafter referred to as the ‘consolidated of trade receivables and the provisions for impairment of ments and Auditor’s Report Thereon but to do so.
financial statements’). receivables, and the importance of cash collection with The Holding Company’s Board of Directors is responsible for The respective Board of Directors of companies included in the
reference to the working capital management of the business. the other information. The other information comprises the
In our opinion and to the best of our information and according Group are responsible for overseeing the financial reporting
information included in the Holding Company’s Annual Report, process of the Group.
to the explanations given to us, the aforesaid consolidated Principal Audit Procedures
but does not include the consolidated financial statements
financial statements give the information required by the
Our audit procedures included but were not limited to the and our auditor’s report thereon. Auditor’s Responsibilities for the Audit of the Consolidated
Companies Act, 2013 (the ‘Act’) in the manner so required and
following: Financial Statements
give a true and fair view in conformity with the accounting Our opinion on the consolidated financial statements does not
principles generally accepted in India, of the consolidated (a) Understanding the trade receivables process with Our objectives are to obtain reasonable assurance about
cover the other information and we do not express any form of
state of affairs of the Group as at 31st March, 2021, of its regards to Valuation and evaluation of controls designed whether the consolidated financial statements as a whole
assurance conclusion thereon.
consolidated profit, consolidated changes in equity and its and implemented by the Group’s management. are free from material misstatement, whether due to fraud or
consolidated cash flows for the year then ended. In connection with our audit of the consolidated financial error, and to issue an auditor’s report that includes our opinion.
(b) Assessment of the appropriateness of the Group’s statements, our responsibility is to read the other information Reasonable assurance is a high level of assurance, but is not
Basis for Opinion credit risk policy and obtaining an understanding on and, in doing so, consider whether the other information a guarantee that an audit conducted in accordance with SAs
We conducted our audit in accordance with the Standards management of credit risk. is materially inconsistent with the consolidated financial will always detect a material misstatement when it exists.
on Auditing (SAs) specified under Section 143(10) of the statements or our knowledge obtained in the audit or Misstatements can arise from fraud or error and are considered
(c) Control testing: material if, individually or in aggregate, they could reasonably
Act. Our responsibilities under those Standards are further otherwise appears to be materially misstated. If, based on the
described in the Auditor’s Responsibilities for the Audit of the work we have performed, we conclude that there is a material be expected to influence the economic decisions of users
• Obtaining an understanding on credit approvals,
Consolidated Financial Statements section of our report. We misstatement of this other information, we are required to taken on the basis of these consolidated financial statements.
establishing credit limits and continuous monitoring
are independent of the Group in accordance with the ethical of creditworthiness of customers to which the Group report that fact. We have nothing to report in this regard.
As part of an audit in accordance with SAs, we exercise
requirements that are relevant to our audit of the consolidated grants the credit in normal course of business.
Responsibilities of Management and Those Charged with professional judgment and maintain professional skepticism
financial statements in India in terms of the Code of Ethics
Governance for the Consolidated Financial Statements throughout the audit. We also:
issued by the Institute of Chartered Accountants of India (ICAI) • Obtaining understanding on how the Group
and the relevant provisions of the Act, and we have fulfilled establishes an allowance for doubtful debts and The Holding Company’s Board of Directors is responsible • Identify and assess the risks of material misstatement
our other ethical responsibilities in accordance with act. We impairment that represents its estimate of incurred for the preparation and presentation of these consolidated of the consolidated financial statements, whether due
believe that the audit evidence we have obtained is sufficient losses in respect of trade receivables. financial statements in term of the requirements of the Act to fraud or error, design and perform audit procedures
and appropriate to provide a basis for our opinion. that give a true and fair view of the consolidated financial responsive to those risks, and obtain audit evidence that
(d) Tests of details: position, consolidated financial performance, consolidated is sufficient and appropriate to provide a basis for our
Key Audit Matters changes in equity and consolidated cash flows of the Group in
• We have checked the ageing analysis, on a opinion. The risk of not detecting a material misstatement
Key audit matters are those matters that, in our professional accordance with the accounting principles generally accepted
sample basis and subsequent receipt of the trade resulting from fraud is higher than for one resulting from
judgement, were of most significance in our audit of the in India, including the Indian Accounting Standards specified
receivables, to the source documents, including error, as fraud may involve collusion, forgery, intentional
consolidated financial statements of the current year. These under Section 133 of the Act. The respective Board of Directors
bank statements; omissions, misrepresentations, or the override of internal
matters were addressed in the context of our audit of the of the companies included in the Group are responsible for control;
consolidated financial statements as a whole, and in forming • We have verified the underlying supporting maintenance of adequate accounting records in accordance
our opinion thereon, and we do not provide a separate opinion documents like acceptance of invoices along with the provisions of the Act for safeguarding the assets • Obtain an understanding of internal control relevant to
on these matters. with various correspondence carried out by the of the Group and for preventing and detecting frauds and the audit in order to design audit procedures that are
other irregularities; selection and application of appropriate appropriate in the circumstances. Under Section 143(3)

186 187
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

(i) of the Act, we are also responsible for expressing our statements of the current period and are therefore the key g) with respect to the other matters to be included in the (2) the Group did not have any material foreseeable
opinion on whether the Company has adequate internal audit matters. We describe these matters in our auditor’s Auditors Report in accordance with the requirements of losses on the long-term contracts including
financial controls system in place and the operating report, unless law or regulation precludes public disclosure Section 197(16) of the Act, as amended, in our opinion derivative contracts; and
effectiveness of such controls; about the matter or when, in extremely rare circumstances, and to the best of our information and according to the
we determine that a matter should not be communicated in explanations given to us, the remuneration paid by the (3) there were no amounts which were required to be
• Evaluate the appropriateness of accounting policies used our report because the adverse consequences of doing so Holding Company to its directors is in accordance with transferred to the Investor Education and Protection
and the reasonableness of accounting estimates and would reasonably be expected to outweigh the public interest the provisions of Section 197 of the Act; and Fund by the Group.
related disclosures made by management; benefits of such communication.
h) with respect to the other matters to be included in
• Conclude on the appropriateness of management’s use Other Matter the Auditor’s Report in accordance with Rule 11 of the SHARP & TANNAN
of the going concern basis of accounting and, based Companies (Audit and Auditors) Rules, 2014, in our Chartered Accountants
We draw attention to Note 52 to the accompanying Consolidated
on the audit evidence obtained, whether a material opinion and to the best of our information and according Firm’s Registration No.109982W
Financial Statements which explains the uncertainties and
uncertainty exists related to events or conditions that to the explanations given to us: by the hand of
the Management’s evaluation of the financial impact on the
may cast significant doubt on the ability of the Group
Company due to lockdown and other restrictions imposed
to continue as a going concern. If we conclude that (1) the Consolidated financial statements disclose
on account of COVID-19 pandemic situation, for which a Edwin P. Augustine
a material uncertainty exists, we are required to draw the impact of pending litigations on consolidated
definitive assessment of the impact is highly dependent upon Partner
attention in our auditor’s report to the related disclosures financial position of the Group - (refer note 41 to the
the circumstances as they evolve in the subsequent period. Membership No. 043385
in the consolidated financial statements or, if such consolidated financial statements);
Mumbai, 12th June, 2021 UDIN: 21043385AAAAEC9942
disclosures are inadequate, to modify our opinion. Our Our opinion is not modified in respect of this matter.
conclusions are based on the audit evidence obtained up
to the date of our auditor’s report. However, future events Report on Other Legal and Regulatory Requirements
or conditions may cause the Group to cease to continue As required by Section 143(3) of the Act, we report, that to the
as a going concern; extent applicable:

• Evaluate the overall presentation, structure and content a) we have sought and obtained all the information and
of the consolidated financial statements, including the explanations which to the best of our knowledge and
disclosures, and whether the consolidated financial belief were necessary for the purposes of our audit of the
statements represent the underlying transactions and aforesaid consolidated financial statements;
events in a manner that achieves fair presentation; and
b) in our opinion, proper books of account as required by
• Obtain sufficient appropriate audit evidence regarding law relating to preparation of the aforesaid consolidated
the financial information of the entities within the Group financial statements have been kept by the Company so
to express an opinion on the consolidated financial far as it appears from our examination of those books;
statements. We are responsible for the direction,
supervision and performance of the audit of the financial c) the Consolidated Balance Sheet, the Consolidated
statements of such entities included in the consolidated Statement of Profit and Loss, the Consolidated Statement
financial statements of which we are the independent of Changes in Equity and the Consolidated Statement of
auditors. We remain solely responsible for our audit Cash Flows dealt with by this Report are in agreement with
opinion. the relevant books of account maintained for the purpose
of preparation of the consolidated financial statements;
We communicate with those charged with governance of
the Holding Company included in the consolidated financial d) in our opinion, the aforesaid consolidated financial
statement of which we are independent auditors regarding, statements comply with the Indian Accounting Standards
among other matters, the planned scope and timing of the specified under Section 133 of the Act;
audit and significant audit findings, including any significant
e) On the basis of the written representations received
deficiencies in internal control that we identify during our
from the directors of the Holding Company as on 31st
audit.
March, 2021 taken on record by the Board of Directors
We also provide those charged with governance with a of the Holding Company and the reports of the statutory
statement that we have complied with relevant ethical auditors of the subsidiary company incorporated in
requirements regarding independence, and to communicate India, none of the directors of the Group companies is
with them all relationships and other matters that may disqualified as on 31st March, 2021 from being appointed
reasonably be thought to bear on our independence, and as a director in terms of Section 164 (2) of the Act;
where applicable, related safeguards.
f) with respect to the adequacy of the internal financial
From the matters communicated with those charged with controls over financial reporting of the Group and the
governance, we determine those matters that were of operating effectiveness of such controls, refer to our
most significance in the audit of the consolidated financial separate Report in Annexure ‘A’;

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

ANNEXURE ‘A’ TO THE INDEPENDENT AUDITOR’S REPORT

(Referred to in paragraph 2(f) of our report of even date)

Report on the Internal Financial Controls under Section effectiveness. Our audit of internal financial controls over control over financial reporting may become inadequate Company considering the essential components of internal
143(3)(i) of the Companies Act, 2013 (the ‘Act’) financial reporting included obtaining an understanding of because of changes in conditions, or that the degree of control stated in the Guidance Note issued by the ICAI.
internal financial controls over financial reporting, assessing compliance with the policies or procedures may deteriorate.
In conjunction with our audit of the consolidated financial the risk that a material weakness exists, and testing and
statements of the Parag Milk Foods Limited (the ‘Holding evaluating the design and operating effectiveness of internal Opinion SHARP & TANNAN
Company’) as of and for the year ended 31st March, 2021, control based on the assessed risk. The procedures selected Chartered Accountants
we have audited the internal financial controls over financial In our opinion, to the best of our information and according Firm’s Registration No.109982W
depend on the auditor’s judgement, including the assessment
reporting of the Holding Company and its subsidiary, which is to the explanations given to us, the Holding Company and its by the hand of
of the risks of material misstatement of the consolidated
a company incorporated in India, as of that date. subsidiary which is a company incorporated in India, have, in
financial statements, whether due to fraud or error.
all material respects, an adequate internal financial controls
Management’s Responsibility for Internal Financial Controls We believe that the audit evidence we have obtained is system over financial reporting and such internal financial Edwin P. Augustine
sufficient and appropriate to provide a basis for our audit controls over financial reporting were operating effectively Partner
The respective Board of Directors of the Holding Company, as of 31st March, 2021, based on the internal control over
opinion on the internal financial controls system over Membership No. 043385
its subsidiary, which is a company incorporated in India are financial reporting criteria established by the Holding
financial reporting with reference to the financial statements Mumbai, 12th June, 2021 UDIN: 21043385AAAAEC9942
responsible for establishing and maintaining internal financial
of the Group.
controls based on the internal control over financial reporting
criteria established by the Company considering the essential Meaning of Internal Financial Controls Over Financial
components of internal control stated in the Guidance Note on Reporting
Audit of Internal Financial Controls Over Financial Reporting
(the ‘Guidance Note’) issued by the Institute of Chartered A company’s internal financial control over financial
Accountants of India (ICAI). These responsibilities include reporting is a process designed to provide reasonable
the design, implementation and maintenance of adequate assurance regarding the reliability of financial reporting and
internal financial controls that were operating effectively for the preparation of consolidated financial statements for
ensuring the orderly and efficient conduct of its business, external purposes in accordance with generally accepted
including adherence to the respective company’s policies, accounting principles. A company’s internal financial
the safeguarding of its assets, the prevention and detection control over financial reporting includes those policies and
of frauds and errors, the accuracy and completeness of the procedures that: (1) pertain to the maintenance of records
accounting records, and the timely preparation of reliable that, in reasonable detail, accurately and fairly reflect the
financial information, as required under the Act. transactions and dispositions of the assets of the company;
(2) provide reasonable assurance that transactions are
Auditor’s Responsibility recorded as necessary to permit preparation of consolidated
financial statements in accordance with generally accepted
Our responsibility is to express an opinion on the Company’s
accounting principles, and that receipts and expenditures
internal financial controls over financial reporting based on
of the company are being made only in accordance with
our audit. We conducted our audit in accordance with the
authorisations of management and directors of the company;
Guidance Note and the Standards on Auditing, issued by ICAI
and (3) provide reasonable assurance regarding prevention
and deemed to be prescribed under Section 143(10) of the
or timely detection of unauthorised acquisition, use, or
Act, to the extent applicable, to an audit of internal financial
disposition of the company’s assets that could have a material
controls, both applicable to an audit of Internal Financial
effect on the consolidated financial statements.
Controls and, both issued by the ICAI. Those Standards
and the Guidance Note require that we comply with ethical Inherent Limitations of Internal Financial Controls Over
requirements and plan and perform the audit to obtain Financial Reporting
reasonable assurance about whether adequate internal
financial controls over financial reporting was established Because of the inherent limitations of internal financial
and maintained and if such controls operated effectively in controls over financial reporting, including the possibility
all material respects. of collusion or improper management override of controls,
material misstatements due to error or fraud may occur and
Our audit involves performing procedures to obtain audit not be detected. Also, projections of any evaluation of the
evidence about the adequacy of the internal financial internal financial controls over financial reporting to future
controls system over financial reporting and their operating periods are subject to the risk that the internal financial

190 191
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Consolidated Balance Sheet Consolidated Statement of Profit and Loss

as at 31st March, 2021 for the year ended 31st March, 2021
` million ` million

Particulars Notes As at As at Particulars Notes 2020-21 2019-20

31st March, 2021 31st March, 2020
ASSETS Income
Non-current assets Revenue from operations 27 18,417.63 24,379.24
Property, plant and equipment 4 4,310.61 4,270.11
Capital work-in-progress 30.50 70.24 Other income 28 135.09 75.99
Other intangible assets 5 19.43 26.51
Biological assets other than bearer plants 6 402.60 359.72 Total Income 18,552.72 24,455.23
Financial assets Expenses
Investments 7 8.20 5.52
Loans 8 4.36 4.32 Cost of materials consumed 29 13,235.23 17,669.92
Others 9 120.83 121.08
Purchases of Stock-in-trade 30 975.31 2,220.30
Deferred tax assets (net) 36 30.86 88.26
Other non-current assets 10 39.21 187.11 Changes in inventories of finished goods, stock-in-trade and work-in-progress 31 (591.43) (1,743.36)
Total Non-current assets 4,966.60 5,132.87
Current assets Employee benefits expense 32 781.97 961.04
Inventories 11 6,947.85 6,328.86 Finance costs 33 457.74 381.04
Financial assets
Trade receivables 12 1,589.48 3,034.79 Depreciation and amortisation expense 34 517.98 536.41
Cash and cash equivalents 13 69.45 223.78
Bank balances (other than above) 14 117.06 54.65 Other expenses 35 2,768.68 3,160.32
Other current assets 15 3,134.85 2,125.09 Total Expenses 18,145.48 23,185.67
Total Current assets 11,858.69 11,767.17
Total Assets 16,825.29 16,900.04 Profit before tax 407.24 1,269.56
EQUITY AND LIABILITIES
Equity
Tax expense 36
Equity share capital 16 839.39 839.39 Current tax 61.12 297.88
Other equity 17 8,442.03 8,272.23
Total Equity 9,281.42 9,111.62 MAT (credit)/reversal - 53.83
LIABILITIES Deferred tax 63.50 23.22
Non-current liabilities
Financial liabilities Tax adjustment in respect of ealier years 75.57 (42.26)
Borrowings 18 333.19 481.48
Other financial liability 19 85.92 112.14 Profit for the year 207.05 936.89
Provisions 20 42.00 45.10 Other comprehensive income
Total Non-Current Liabilities 461.11 638.72
Current liabilities Items that will not be reclassified to profit or loss
Financial liabilities
Borrowings 21 3,175.24 3,215.68 Remeasurements of the defined benefit plans 7.75 5.47
Trade payables 22 Income tax on above (1.95) (1.91)
(A) total outstanding dues of micro and small enterprises 8.97 25.41
(B) total outstanding dues of creditors other than micro and small enterprises. 3,032.33 2,915.00 Other comprehensive income for the year, net of tax 5.80 3.56
Other financial liabilities 23 629.18 804.26 Total Comprehensive income for the year 212.85 940.45
Other current liabilities 24 231.19 104.90
Provisions 25 4.78 4.58 Earnings per equity share of face value of ` 10 each:
Current tax liabilities (net) 26 1.07 79.87
Basic earnings per share (in `) 45 2.47 11.16
Total Current liabilities 7,082.76 7,149.70
Total Liabilities 7,543.87 7,788.42 Diluted earnings per share (in `) 45 2.46 11.14
Total Equity and Liabilities 16,825.29 16,900.04

Significant Accounting Policies 3 Significant Accounting Policies 3

Contingent Liabilities and Commitments 41 Other Notes 4 to 53
Other Notes 4 to 53
The accompanying notes form an integral part of the consolidated financial statements. The accompanying notes form an integral part of these Consolidated Financial Statements.

As per our attached report

As per our attached report
SHARP & TANNAN For and on behalf of the Board of Directors
SHARP & TANNAN For and on behalf of the Board of Directors
Chartered Accountants
Chartered Accountants
Firm’s Registration No. 109982W
Firm’s Registration No. 109982W
by the hand of
by the hand of

Edwin P. Augustine Devendra Shah Pritam Shah Edwin P. Augustine Devendra Shah Pritam Shah
Partner Chairman Managing Director Partner Chairman Managing Director
Membership No. 043385 DIN: 01127319 DIN: 01127247 Membership No. 043385 DIN: 01127319 DIN: 01127247

Shashikant Dalmia Rachana Sanganeria Shashikant Dalmia Rachana Sanganeria

Chief Financial Officer Company Secretary & Compliance Officer Chief Financial Officer Company Secretary & Compliance Officer
Membership No. ACS10280 Membership No. ACS10280
Place: Mumbai Place: Manchar Place: Mumbai Place: Manchar
Date: 12th June, 2021 Date: 12th June, 2021 Date: 12th June, 2021 Date: 12th June, 2021

192 193
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Consolidated Statement of Changes in Equity Consolidated Statement of Cash Flows

for the year ended 31st March, 2021 for the year ended 31st March, 2021
` million ` million

Equity share capital 2020-21 2019-20

Particulars

Particulars As at As at A. Cash flows from operating activities

31st March, 2021 31st March, 2020
Profit before tax 407.24 1,269.56
No. of shares ` million No. of shares ` million
Balance at the beginning of the reporting period 83,938,567 839.39 83,938,567 839.39 Depreciation and amortisation expense 517.98 536.41
Change during the year - - - -
Balance at the end of the reporting period 83,938,567 839.39 83,938,567 839.39 Allowance for doubtful debts and advances (net of recoveries/reversals) 131.29 98.89

Other equity (refer note 17) ` million Net (gain) / loss on sale/ fair valuation of investments (6.07) 6.25

Particulars Reserves and Surplus Other Total Other ESOS expense (0.98) 3.38
Comprehensive Equity
Securities General Employee Retained Income Finance costs 457.74 381.04
Premium Reserve Stock Options Earnings
Reserve Outstanding
Sundry balances written-back (24.78) (5.58)
Balance as at 1st April, 2019 4,447.85 59.26 4.89 2,929.48 (9.50) 7,431.98
Profit for the year - - - 936.89 - 936.89 Loss on sale or death of livestock 16.39 15.21
Other comprehensive income for the year (net of tax) - - - - 3.56 3.56
Fair value change of livestock (65.68) (40.00)
Deferred Employee Compensation Expense - - 3.38 - - 3.38
Ind AS 116, Leases, impact - - - (2.18) - (2.18) Interest income (20.49) (25.12)
Dividend paid - - - (84.11) - (84.11)
Operating profit before working capital changes 1,412.64 2,240.04
Tax on dividend - - - (17.29) - (17.29)
Balance as at 31st March, 2020 4,447.85 59.26 8.27 3,762.79 (5.94) 8,272.23 Adjustments for :
Profit for the year - - - 207.05 - 207.05
Other comprehensive income for the year (net of tax) - - - - 5.80 5.80 (Increase)/Decrease in inventories (618.99) (1,700.07)
Deferred Employee Compensation Expense - - (0.98) - - (0.98) (Increase)/Decrease in trade and other receivables 300.20 (802.55)
Dividend paid - - - (42.07) - (42.07)
Balance as at the 31st March, 2021 4,447.85 59.26 7.29 3,927.77 (0.14) 8,442.03 (Decrease)/Increase in trade and other payables 120.52 (47.76)

Increase/(Decrease) in provisions 4.85 0.46

As per our attached report
SHARP & TANNAN For and on behalf of the Board of Directors Cash generated from operations 1,219.22 (309.88)
Chartered Accountants
Firm’s Registration No. 109982W Taxes paid (net of refunds) (219.70) (354.07)
by the hand of
Net cash generated from/(used in) operating activities 999.52 (663.95)

Edwin P. Augustine Devendra Shah Pritam Shah B. Cash Flows from Investing Activities
Partner Chairman Managing Director
Membership No. 043385 DIN: 01127319 DIN: 01127247 Purchase of Property, plant and equipment (434.70) (306.66)

Shashikant Dalmia Rachana Sanganeria Purchase of intangible assets (8.85) (11.50)

Chief Financial Officer Company Secretary & Compliance Officer
Membership No. ACS10280 Sale of livestock 6.41 2.69

Place: Mumbai Place: Manchar Sale of Property, plant and equipment 6.68 0.58
Date: 12th June, 2021 Date: 12th June, 2021
Maturity / (investment) of fixed deposits (63.13) 2.08

Investment in mutual funds (2.68) (0.01)

Interest received 27.96 17.84

Net cash used in investing activities (468.31) (294.98)

194 195
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Consolidated Statement of Cash Flows Notes to Consolidated Financial Statements

for the year ended 31st March, 2021 for the period ended 31st March, 2021
` million

2020-21 2019-20
1. Corporate information under Section 133 of the Act and other relevant provisions
Particulars
The consolidated financial statements comprises of the Act.
C. Cash Flows from Financing Activities
Proceeds from long-term borrowings - 73.65 financial statements of Parag Milk Foods Limited (“the
The consolidated financial statements were authorised
Proceeds / (repayment) short-term borrowings (net) (40.44) 1,718.22 parent”) and its subsidiary Bhagyalaxmi Dairy Farms Pvt
for issue by the Parent’s Board of Directors on
Repayment of long-term borrowings (143.84) (197.35) Ltd (collectively “the Group”).
12th June,2021
Payment of dividend including dividend distribution tax (42.06) (101.41)
Interest paid (459.20) (383.86) The parent is a public listed company incorporated under
Details of the Group’s accounting policies are included
Net cash flows from/ (used in) financing activities (685.54) 1,109.25 the provisions of the Companies Act, 1956 and its equity
in Note 3.
Net increase/ (decrease) in cash and cash equivalents (A+B+C) (154.33) 150.32 shares are listed on the National Stock Exchange (NSE)
Cash and cash equivalents at the beginning of the year 223.78 73.46 and Bombay Stock Exchange (BSE) in India. C. Functional and presentation currency
Cash and cash equivalents at the end of the year 69.45 223.78
The Group is engaged in the business of production and These consolidated financial statements are presented
procurement of cow milk mainly in western and southern in Indian Rupees (`), which is also the Groups’ functional
Particulars 2020-21 2019-20
region, undertakes processing of milk and manufacture currency. All amounts have been rounded-off to two
Cash and cash equivalents include:
of various value added products namely cheese, butter, decimal places to the nearest millions, unless otherwise
Balance with bank 42.77 203.60
ghee, fresh cream, milk, milk powder, flavoured milk, indicated.
Cash on hand 26.68 20.18
Total 69.45 223.78 lassi, curd etc. which are marketed under its registered
D. Basis of measurement
Notes : brand name “Gowardhan”, “Go”, “Pride of Cows”, “Topp
up” and “Avvatar”. The consolidated financial statements have been prepared
(a) The above Statement of Cash Flows has been prepared under the ‘Indirect Method’ as set out in the Indian Accounting on the historical cost basis except for the following items:
Standard (Ind AS) 7, Statement of Cash Flows as specified in the Companies (Indian Accounting Standards) Rules, 2015, as 2. Basis of preparation
amended from time to time. tems Measurement Basis
A. Consolidated Financial Statements
(b) Additions to property, plant and equipment include movements of capital work-in-progress during the year. Certain financial assets and Fair value
The consolidated financial statements incorporate
liabilities
(c) Non cash movement in borrowings include addition/deletion on account of unrealised foreign exchange loss/(gain) of Rs the financial statements of the company and all its
subsidiaries, being the entities that it controls. Control is Shared-based payments Fair value
4.55 million (31st March, 2020: Rs 30.04 million) in respect of foreign currency loan.
evidenced where the group has power over the investee Biological Assets Fair Value
(d) The net profit / loss arising due to conversion of current assets / current liabilities, receivable / payable in foreign currency is or is exposed, or has rights to variable returns from its Net defined benefit (asset)/ Present value of defined
furnished under the head ‘Exchange Fluctuation (net)’. involvement with the investee and has the ability to affect liability benefit obligation less Fair
those returns through its power over the investee. Power is value of plan assets
Movement:- ` million
demonstrated through existing rights that give the ability
Particulars Opening Cash movement Foreign exchange Fair value Others Closing Balance to direct relevant activities, which significantly affect the E. Current / non-current classification of assets/liabilities
Balance changes changes entity returns. The financial statements of subsidiaries The Group has classified all its assets/liabilities into
Long-term borrowing (net) 783.76 (147.66) (4.55) 3.82 - 635.37 are prepared for the same reporting year as the parent current/non-current portion based on the time frame
Short-term borrowing (net) 3,215.68 (40.44) - - - 3,175.24
company. Where necessary, adjustments are made to of 12 months from the date of the financial statements.
the financial statements of subsidiaries to align the Accordingly, assets/liabilities expected to be realised
Total 3,999.44 (188.10) (4.55) 3.82 - 3,810.61
accounting policies of the group. For non-wholly owned /settled within 12 months from the date of financial
(g) Figures for the previous year have been regrouped wherever necessary. subsidiaries. A share of the profit/loss for the financial statements are classified as current and other assets/
year and net assets is contributed to the non-controlling liabilities are classified as non-current
As per our attached report interests as shown in the consolidated statement of profit
SHARP & TANNAN For and on behalf of the Board of Directors and loss F. Use of estimates and judgements
Chartered Accountants In the preparation of the financial statements, the Group
Firm’s Registration No. 109982W B. Statement of compliance
makes judgements, estimates and assumptions about
by the hand of
The financial statements of the Group have been prepared the carrying amount of assets and liabilities that are
in accordance with Indian Accounting Standards (Ind AS) not readily apparent from other sources. The estimates
Edwin P. Augustine Devendra Shah Pritam Shah
as per the Companies (Indian Accounting Standards) and associated assumptions are based on historical
Partner Chairman Managing Director
Membership No. 043385 DIN: 01127319 DIN: 01127247 Rules, 2015 notified under Section 133 of Companies Act, experience and other factors that are considered to be
2013, (the ‘Act’) and other relevant provisions of the Act. relevant. Actual results may differ from these estimates.
Shashikant Dalmia Rachana Sanganeria
Chief Financial Officer Company Secretary & Compliance Officer The financial statements up to and for the year ended Estimates and underlying assumptions are reviewed on
Membership No. ACS10280 31st March 2017 were prepared in accordance with the an ongoing basis. Revisions to accounting estimates are
Place: Mumbai Place: Manchar Companies (Accounting Standards) Rules, 2006, notified recognised prospectively. Information about assumptions,
Date: 12th June, 2021 Date: 12th June, 2021

196 197
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

judgements and estimation uncertainties that have a 3. Significant accounting policies reviewed at each financial year-end and adjusted 1st April, 2019 using the modified retrospective method of
significant risk of resulting in a material adjustment in the a) Property, plant and equipment prospectively, if appropriate. transition. Accordingly, comparatives for the year ended
year ending 31st March, 2021 are as below and also been 31st March, 2019 have not been retrospectively adjusted.
i. Recognition and measurement iv. Reclassification to investment property
discussed in detail in the relevant section of accounting The Company’s lease asset classes primarily consist of
Items of property, plant and equipment, are measured When the use of a property changes from owner-occupied leases of land, building and equipment.
policies.
at cost (which includes capitalised borrowing costs, if to investment property, the property is reclassified as
• Measurement of defined benefit obligations: key any) less accumulated depreciation and accumulated investment property at its carrying amount on the date of At the date of commencement of lease, the Company
actuarial assumptions; impairment losses, if any. classification. recognise a right-of-use asset (“ROU”) and a
corresponding lease liability for all lease arrangements in
• Useful life of property, plant and equipment Cost of an item of property, plant and equipment includes v. Capital work-in-progress includes cost of property, which it is a lessee, except for leases with a term of twelve
its purchase price, duties, taxes, after deducting trade plant and equipment under installation / under develop- month or less (short-term leases) and low value leases.
• Fair value measurement of financial instruments discounts and rebates, any directly attributable cost of ment as at the balance sheet date. For these short-term and low value leases, the Company
bringing the item to its working condition for its intended recognizes the lease payments as operating expense on
• Fair value measurement of biological assets b) Intangible assets
use and estimated costs of dismantling and removing the straight-line basis over the term of lease.
i. Recognition and measurement
• Impairment of financial assets. item and restoring the site on which it is located.
Intangible assets that are acquired by the Group, The right-of-use assets are initially recognized at cost,
G. Measurement of fair values The cost of a self-constructed item of property, plant and which have finite useful lives, are measured at cost less which comprises the initial amount of the lease liability
equipment comprises the cost of materials, direct labour accumulated amortisation and accumulated impairment adjusted for any lease payments made at or prior to the
Certain accounting policies and disclosures of the Group
and any other costs directly attributable to bringing the losses. commencement date of the lease plus any initial direct
require the measurement of fair values, for both financial
item to its intended working condition and estimated costs costs less any lease incentives. They are subsequently
and non-financial assets and liabilities. Cost includes expenditures that are directly attributable
of dismantling, removing and restoring the site on which measured at cost less accumulated depreciation and
it is located, wherever applicable. If significant parts of an to the acquisition of the intangible asset.
Fair values are categorised into different levels in a fair impairment losses.
item of property, plant and equipment have different useful
value hierarchy based on the inputs used in the valuation ii. Subsequent expenditure
lives, then they are accounted for as separate items (major The Right of use of assets are depreciated from the
techniques as follows: Subsequent expenditure is capitalised only when it
components) of property, plant and equipment. commencement date on a straight line basis over the
increase the future economic benefits embodied in the shorter of the lease term and useful life of the underlying
• Level 1: quoted prices (unadjusted) in active markets
Any gain or loss on disposal of an item of property, plant specific assets to which it relates. All other expenditure asset. Right of use of assets are evaluated for recoverability
for identical assets or liabilities.
and equipment is recognised in statement of profit or are recognised in profit or loss as incurred. whenever events or changes in circumstances indicate
• Level 2: inputs other than quoted prices included in loss. that their carrying amounts may not be recoverable.
iii. Amortisation
Level 1 that are observable for the asset or liability,
ii. Subsequent expenditure Amortisation is recognised in profit or loss on a straight The Lease liability is initially measured at amortized cost
either directly (i.e. as prices) or indirectly (i.e. derived
from prices). Subsequent expenditure is capitalised only if it is probable line basis over the estimated useful lives of the intangible at the present value of future lease payments. The lease
that the future economic benefits associated with the assets from the date that they are available for use. The payments are discounted using the interest rate implicit
• Level 3: inputs for the asset or liability that are not based expenditure will flow to the Group. estimated useful lives are as follows: in the lease, or if not readily determinable, using the
on observable market data (unobservable inputs). incremental borrowing rates in the country of domicile
iii. Depreciation Assets Useful life (years) of the leases. Lease Liabilities are re measured with
When measuring the fair value of an asset or a liability, Depreciation on cost of fixed assets is provided on Trade Marks 10 corresponding adjustment to the related right to use of
the Group uses observable market data as far as possible. straight line method at estimated useful life, which is in asset if company changes its assessment if whether it will
Website Development 3
If the inputs used to measure the fair value of an asset line with the estimated useful life as specified in Schedule exercise an extension or termination option.
or a liability fall into a different levels of the fair value Computer Software 3
II of the Companies Act, 2013, except for Second hand
hierarchy, then the fair value measurement is categorised machineries which are depreciated over an estimated Lease liability and ROU asset have been separately
Amortisation method, useful lives and residual values are
in its entirety in the same level of the fair value hierarchy useful life of 10 years based on management estimate. presented in the Balance Sheet and lease payments have
reviewed at the end of each financial year and adjusted if
as the lowest level input that is significant to the entire been classified as financing cash flows.
appropriate.
measurement. Depreciation on additions is provided on a prorata basis
from the date of ready to use and in case of Projects from The following is the summary of practical expedients
c) Leases
Further information about the assumptions made in the the date of commencement of commercial production. elected on initial application.
The Company has implemented the Ind AS 116 “Leases”
measuring fair values is included in the following notes: Depreciation on deductions/disposals is provided on a
as notified by the Ministry of Corporate Affairs on 30th 1. Applied a single discount rate to portfolio of leases of
pro-rata basis upto the month proceeding the month of
• Share-based payments March 2019 through the Companies (Indian Accounting similar assets in similar economic environment with
deduction/disposal.
Standards) Amendment Rules, 2019. similar end date.
• Financial instruments. The residual values, useful lives and methods of
Effective 1st April, 2019, the Company has adopted Ind AS 2. Applied the exemption not to recognize right to use of
depreciation of property, plant and equipment are
• Fair valuation of biological assets 116 “Leases”, applied to all the lease contracts existing on asset and liabilities for leases with less than 12 months

198 199
 Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

of lease term of the date of initial application. The carrying amount of the asset is increased to its way purchase and sale of financial assets are accounted expire, or it transfers the right to receive the contractual
revised recoverable amount, provided that this amount for at trade date. cash flows in a transaction in which substantially all of
3. Applied the practical expedient to grandfather does not exceed the carrying amount that would have the risks and rewards of ownership of the financial assets
the assessment of which transactions are leases. been determined (net of any accumulated amortisation ii. Classification and subsequent measurement Financial
are transferred or in which the Group neither transfers
Accordingly IND AS 116 is applied only to contracts that or depreciation) had no impairment loss been recognised Assets
nor retains substantially all of the risks and rewards of
were previously identified as leases under IND AS 17 for the asset in prior years. Financial assets carried at amortised cost ownership and does not retain control of the financial
4. Excluding initial direct costs for the measurement of A debt instrument is subsequently measured at amortised asset.
f) Inventories
cost if it is held within a business model whose objective
right to use of asset at the date of initial application.
Inventories are valued at the lower of cost (including is to hold the asset in order to collect contractual cash If the Group enters into transactions whereby it transfers
d) Biological Asset prime cost, excise duty and other overheads incurred flows and the contractual terms of the financial asset assets recognised on its balance sheet, but retains
in bringing the inventories to their present location give rise on specified dates to cash flows that are solely either all or substantially all of the risks and rewards of
Biological Assets i.e. livestock (cows) are measured at
and condition) and estimated net realisable value, after payments of principal and interest on the principal the transferred assets, the transferred assets are not
fair value less costs to sell, with any change therein derecognised.
providing for obsolescence, where appropriate. The amount outstanding.
recognised in statement of profit and loss.
comparison of cost and net realisable value is made on an
Financial assets at fair value through other Financial liabilities
e) Impairment item-by-item basis. The net realisable value of materials
comprehensive income The Group derecognises a financial liability when its
in process is determined with reference to the selling
i. Financial assets A debt instrument is subsequently measured at fair value contractual obligations are discharged or cancelled, or
prices of related finished goods. Raw materials, packing
The Group recognises loss allowances using the expected through other comprehensive income if it is held within expire.
materials and other supplies held for use in production
credit loss (ECL) model for the financial assets which are a business model whose objective is achieved by both
of inventories are not written down below cost except The Group also derecognises a financial liability when
not fair valued through profit or loss. Loss allowance collecting contractual cash flows and selling financial
in cases where material prices have declined, and it is its terms are modified and the cash flows under the
for trade receivables with no significant financing assets and the contractual terms of the financial asset
estimated that the cost of the finished products will modified terms are substantially different. In this case,
component is measured at an amount equal to lifetime give rise on specified dates to cash flows that are solely
exceed their net realisable value. a new financial liability based on the modified terms is
ECL with simplified approach. For all other financial assets, payments of principal and interest on the principal
amount outstanding. recognised at fair value. The difference between the
expected credit losses are measured at an amount equal The provision for inventory obsolescence is assessed
carrying amount of the financial liability extinguished and
to the 12-month ECL, unless there has been a significant regularly based on estimated usage and shelf life
In case, the Group’s management has made an irrevocable a new financial liability with modified terms is recognised
increase in credit risk from initial recognition in which of products. election at the time of initial recognition to account for in the statement of profit and loss.
case those are measured at lifetime ECL. The amount the equity investment (Other than Investments in equity
of expected credit losses (or reversal) that is required Raw materials, packing materials and stores and spares
instruments of Subsidiary) fair value through other iv. Offsetting
to adjust the loss allowance at the reporting date to the are valued at cost computed on first in first out basis. The
comprehensive income. This election is not permitted if Financial assets and financial liabilities are offset and the
amount that is required to be recognised is recognised as cost includes purchase price, inward freight and other
the equity investment is held for trading. The classification net amount presented in the balance sheet when, and
an impairment gain or loss in statement of profit or loss. incidental expenses net of refundable duties, levies and
is made on initial recognition and is irrevocable. only when, the Group currently has a legally enforceable
taxes, where applicable.
right to set off the amounts and it intends either to settle
ii. Non -financial assets Investment in subsidiary
Work-in-progress is valued at input material cost plus them on a net basis or realise the asset and settle the
Intangible assets and property, plant and equipment Investment in subsidiary is carried at cost in the liability simultaneously.
conversion cost as applicable.
Intangible assets and property, plant and equipment are standalone financial statements of the Parent
evaluated for recoverability whenever events or changes Stock-in-trade and finished goods are valued at the lower h) Revenue recognition
Financial assets at fair value through profit or loss
in circumstances indicate that their carrying amounts of net realisable value and cost (including prime cost and Revenue is recognised when it is probable that the
other overheads incurred in bringing the inventories to A financial asset which is not classified in any of the economic benefits associated with a transaction flow to
may not be recoverable. For the purpose of impairment
above categories are subsequently fair valued through the company in the ordinary course of its activities and
testing, the recoverable amount (i.e. the higher of the fair their present location and condition), computed on a first
profit or loss.
value less cost to sell and the value-in-use) is determined in first out basis. the amount of revenue can be measured reliably. Revenue
on an individual asset basis unless the asset does not Financial liabilities is measured at the fair value of the consideration received
g) Financial instruments or receivable, net of returns, trade discounts and volume
generate cash flows that are largely independent of Financial liabilities are subsequently carried at amortised
those from other assets. In such cases, the recoverable i. Recognition and initial measurement rebates allowed by the Group.
cost using the effective interest method. For trade and
amount is determined for the CGU to which the asset The Group initially recognises financial assets and financial other payables maturing within one year from the balance Revenue includes only the gross inflows of economic
belongs. If such assets are considered to be impaired, the liabilities when it becomes a party to the contractual sheet date, the carrying amounts approximate fair value benefits, including excise duty, received or receivable by
impairment to be recognised in the Statement of Profit provisions of the instrument. All financial assets and due to the short maturity of these instruments. the company, on its own account. Amount collected on
and Loss is measured by the amount by which the carrying liabilities are measured at fair value on initial recognition. behalf of third parties such as sales tax, value added tax
value of the assets exceeds the estimated recoverable Transaction costs that are directly attributable to the iii. Derecognition
and goods and services tax are excluded from revenue.
amount of the asset. An impairment loss is reversed in the acquisition or issue of financial assets and financial Financial assets
statement of profit and loss if there has been a change in liabilities that are not at fair value through profit or loss The Group derecognises a financial asset when the Processing charges is recognised as per the terms of the
the estimates used to determine the recoverable amount. are added to the fair value on initial recognition. Regular contractual rights to the cash flows from the financial asset contract when the related services are rendered.

200 201
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

Dividend income is recognised when the Group’s right i. Current tax to settle such assets and liabilities on a net basis. obligation cannot be measured reliably. When there is
to receive the payment is established, which is generally Current tax comprises the expected tax payable or possible obligation or a present obligation in respect of
when shareholders approve the dividend. Presentation of current and deferred tax which
receivable on the taxable income or loss for the year and
any adjustment to the tax payable or receivable in respect Current and deferred tax are recognised as income or an
Interest income is recognised using the effective interest expense in the Statement of Profit & Loss, except when they Likelihood of outflow of resources embodying the economic
of previous years. The amount of current tax reflects the
method. relate to items that are recognised in Other Comprehensive benefits is remote, no provision or disclosure is made.
best estimate of the tax amount expected to be paid or
received after considering the uncertainty, if any related to Income, in which case, the current and deferred tax
i) Foreign currencies Contingent assets are not recognised. However, when the
income taxes. It is measured using tax rates (and tax laws) income/ expense are recognised in Other Comprehensive
Initial Recognition realisation of income is virtually certain, then the related
enacted or substantively enacted by the reporting date. Income.
asset is no longer a contingent asset, and is recognised as
On initial recognition, transaction in foreign currencies
The Group offsets current tax assets and current tax an asset.
entered into by the Group are recorded in the functional ii. Deferred tax
currency (INR), by applying to the foreign currency amount, liabilities, where it has legally enforceable right to set off
Deferred tax is recognised in respect of temporary n) Employee benefits
the spot exchange rate between the functional currency the recognised amounts and where it intends either to
differences between the carrying amounts of assets Short-term employee benefits
and the foreign currency at the date of the transaction. settle on a net basis, or to realize the asset and settle the
and liabilities for financial reporting purposes and the
Exchange differences arising on foreign exchange liability simultaneously. In case of deferred tax assets and All employee benefits falling due wholly within twelve
corresponding amounts used for taxation purposes.
transactions settled during the year are recognised in the Deferred tax is also recognised in respect of carried forward deferred tax liabilities, the same are offset if the Group has months of rendering the services are classified as short-
Statement of Profit & Loss. tax losses and tax credits. Deferred tax is not recognised legally enforceable right to set off corresponding current term employee benefits, which include benefits like
for: tax assets against current tax liabilities and the deferred salaries, wages, short-term compensated absences and
Measurement of for3eign currency items at reporting tax assets and deferred tax liabilities relate to income taxes performance incentives and are recognised as expenses
date • Temporary differences arising on the initial recognition of levied by the same tax authority on the Group. in the period in which the employee renders the related
assets or liabilities in a transaction that is not a business service.
Foreign currency monetary items of the Group are
combination and that affects neither accounting nor MAT Credits are in the form of unused tax credits that are
translated at the closing exchange rates. Non-monetary
taxable profit or loss at the time of transaction. carried forward by the Group for a specified period of time, Post-employment benefits
items that are measured at historical cost in foreign
hence it is grouped with Deferred Tax Asset/Net of Deferred Contributions to defined contribution schemes such as
currency are translated using the exchange rates at the date • Temporary differences related to investments in tax liabilities. Provident Fund, Employees State Insurance., are recognised
of the transaction. Non-monetary items that are measured subsidiaries, associates and interests in joint ventures,
at fair value in a foreign currency, are translated using the as expenses in the period in which the employee renders
when the timing of the reversal of the temporary l) Borrowing costs
exchange rates at the date when the fair value is measured. differences can be controlled and it is probable that the the related service. The Group has no further obligations
Borrowing costs directly attributable to the acquisition or beyond its monthly contributions. The Group also provides
temporary differences will not reverse in the foreseeable
construction of those property, plant and equipment which for post-employment defined benefit in the form of gratuity.
Exchange differences arising out of these translations future.
necessarily takes a substantial period of time to get ready The cost of providing benefit is determined using the
are recognised in the Statement of Profit & Loss except
Deferred tax assets are recognised to the extent that it is for their intended use are capitalised. All other borrowing projected unit credit method, with actuarial valuation being
exchange differences on long term foreign currency
probable that future taxable profits will be available against costs are expensed in the period in which they incur in the carried out at each balance sheet date. Re-measurement of
monetary items related to acquisition of fixed assets prior
which they can be used. statement of profit and loss. the net benefit liability, which comprise actuarial gains and
to transition to Ind AS, which are included in the cost of
fixed assets. losses, the return on plan assets (excluding interests) and
Deferred tax assets recognised or unrecognised are m) Provisions, contingent liabilities and contingent assets
the effect of the assets ceiling (if any, excluding interest)
reviewed at each reporting date and are recognised The Group recognizes the provisions when a present
j) Government grants are recognised in other comprehensive income. The effect
/ reduced to the extent that it is probable / no longer obligation (legal or constructive) as a result of past event
Government grants are recognised where there is probable respectively that the related tax benefit will be of any plan amendments are recognised in net profit in the
exists and it is probable that an outflow of resources
reasonable assurance that the grant will be received and all realised. Statement of Profit and Loss.
embodying economic benefits will be required to settle
attached conditions will be complied with. When the grant
Deferred tax is measured at the tax rates that are expected such obligation and the amount of such obligation can be Other long-term employee benefits
relates to revenue, it is recognised in the statement of profit
to apply to the period when the asset is realised or the reliably estimated.
and loss on a systematic basis over the periods to which All employee benefits (other than post-employment benefits
they relate. When the grant relates to an asset, it is treated liability is settled, based on the laws that have been enacted and termination benefits) which do not fall due wholly
If the effect of time value of money is material, provisions
as deferred income and recognised in the statement of or substantively enacted by the reporting date. within twelve months after the end of the period in which
are discounted using a current pre-tax rate that reflects
profit and loss on a systematic basis over the useful life of when appropriate, the risk specific to the liability. When the employees render the related services are determined
The measurement of deferred tax reflects the tax
the asset. discounting is used, the increase in provision due to based on actuarial valuation or discounted present value
consequences that would follow from the manner in which
passage of time is recognised as a finance cost. method carried out at each balance sheet date. The
the Group expects, at the reporting date, to recover or
k) Income tax expected cost of accumulating compensated absences
settle the carrying amount of its assets and liabilities.
Income tax comprises current and deferred tax. It is A disclosure for a contingent liability is made when there is determined by actuarial valuation performed by an
recognised in profit or loss except to the extent that it The Group offsets, the current tax assets and liabilities (on is possible obligation or a present obligation that may, independent actuary as at every year end using projected
relates to a business combination or to an item recognised a year on year basis) and deferred tax assets and liabilities, but probably will not require an outflow of resources unit credit method on the additional amount expected to
directly in equity or in other comprehensive income. where it has a legally enforceable right and where it intends embodying the economic benefits or the amount of such be paid / availed as a result of the unused entitlement that

202 203
 Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

has accumulated at the balance sheet date. Expense on Decision Maker (CODM) of the Group. The CODM is

depreciable assets was added/ deducted from the cost of the depreciable asset, which was depreciated over the balance life of the asset. Ind AS 101
` million

includes an optional exemption that allows a first-time adopter to continue the above accounting treatment in respect of the long-term foreign currency

period. The Company has opted to apply this exemption and accordingly the Group has adjusted foreign exchange loss of Rs 4.55 million for the year ended
31st March, 2021 (31st March, 2020: loss of Rs 30.04 million) arising on reporting of long term foreign currency monetary item against the historical
(1) Under the Indian GAAP, the Group was following the accounting treatment as per paragraph 46/ 46A of AS 11 ‘The Effects of Changes in Foreign Exchange
Rates’, with respect to exchange differences arising on restatement of long term foreign currency monetary items. Exchange differences on account of

monetary items recognised in the Financial Statements for the period ending immediately before the beginning of the first Ind AS financial reporting
1,465.02
516.96
(0.04)
(0.62)
6,252.05
Total

5,488.40
764.27

1,981.94
4,270.11

6,252.05
549.22
(6.68)
6,794.59

1,981.94
502.04
-
2,483.98
4,310.61
non-accumulating compensated absences is recognised in responsible for allocating resources and assessing
the period in which the absences occur. performance of the operating segments of the company

o) Share-based payments t) Recent Accounting Developments

-
-
19.24
-
156.41

-
Right of
Use Assets

-
156.41

19.24
137.17

156.41
-
-
156.41

19.24
32.23

51.47
104.94
The cost of equity-settled transactions is determined by The Ministry of Corporate Affairs (“MCA”) vide notification
the fair value at the date when the grant is made using dated 24th March, 2021 amended the Schedule III of the
an appropriate valuation model. That cost is recognised, Companies Act, 2013. The amendments related to Division

-
21.80
11.93
-
43.91
Computer

40.71
3.20

33.73
10.18

43.91
1.02
-
44.93

-
33.73
5.20

38.93
6.00
together with a corresponding increase in share-based I, II and III of Schedule III and are applicable starting
payment (SBP) reserves in equity, over the period in which 1st April, 2021. Key amendments relating to Division II
the performance and/or service conditions are fulfilled which related to companies whose financial statements
in employee benefits expense. The dilutive effect of are required to comply with Companies (Indian Accounting

-
8.00
4.64
-
29.76

-
Office
equipment

20.60
9.16

12.64
17.12

29.76
1.86
-
31.62

12.64
4.82

17.46
14.16
outstanding options is reflected as additional share dilution Standards) Rules 2015 are:
in the computation of diluted earnings per share.
Balance Sheet:
p) Cash and cash equivalents
- Lease liabilities should be separately disclosed under

-
55.63

10.55
5.20

-
Plant and Furniture Vehicles

27.81
27.82
-

15.75
39.88

55.63
5.66
-
61.29

15.75
7.38

23.13
38.16
Cash and cash equivalents includes cash on hand, demand the head ‘financial liabilities’, duly distinguished as
deposits with banks, other short-term highly liquid current or non-current.
investments with original maturities of three months or

-
41.96

8.73
4.23

-
and
Fixtures

40.49
1.47
-

12.96
29.00

41.96
0.42
-
42.38

12.96
4.19

17.15
25.23
less. - 
Certain additional disclosures in the statement of
changes in equity such as changes in equity share
q) Earnings per share capital due to prior period errors and restated

(0.04)
(0.62)
4,792.61

1,280.90
428.52

-
Equipment

4,273.70
519.53

1,709.38
3,083.23

4,792.61
269.87
(6.68)
5,055.80

1,709.38
404.97

2,114.35
2,941.45
Basic Earnings Per Share (‘EPS’) is computed by dividing balances at the beginning of the current reporting

(2) For details of assets given as security against borrowings, Refer Note 18 and Note 21.
the net profit attributable to the equity shareholders by the period.
weighted average number of equity shares outstanding
during the year. Diluted earnings per share is computed by - Specified format for disclosure of shareholding of

(3) Amount of contractual commitments for the acquisition of PPE, Refer note 41
-
-
891.06

103.40
37.29

-
Buildings

849.21
41.85

140.69
750.37

891.06
59.26
-
950.32

140.69
42.08

182.77
767.55
promoters. Specified format for ageing schedule of
dividing the net profit by the weighted average number of
trade receivables, trade payables, capital work-in
equity shares considered for deriving basic earnings per
progress and intangible asset under development
share and also the weighted average number of equity

-
-
41.61

31.64
5.91

-
Leasehold
building
Improvements

40.51
1.10

37.55
4.06

41.61
-
-
41.61

37.55
1.18

38.73
2.88
shares that could have been issued upon conversion of all - If a company has not used funds for the specific
dilutive potential equity shares. Dilutive potential equity purpose for which it was borrowed from banks and
shares are deemed converted as of the beginning of the financial institutions, then disclosure of details of
year, unless issued at a later date. In computing diluted where it has been used.
earnings per share, only potential equity shares that are

-
-
-
-
199.10

-
Freehold
land

195.37
3.73

-
199.10

199.10
211.13
-
410.23

-
-

-
410.23
dilutive and that either reduces earnings per share or - 
Specific disclosure under ‘additional regulatory
increases loss per share are included. The number of requirement’ such as compliance with approved
shares and potentially dilutive equity shares are adjusted schemes of arrangements, compliance with number
retrospectively for all periods presented for the share splits. of layers of companies, title deeds of immovable

Closing accumulated depreciation up to 31st March, 2021

Closing accumulated depreciation up to 31st March, 2020
property not held in name of company, loans and

Closing gross carrying amount as at 31st March, 2020

Closing gross carrying amount as at 31st March, 2021

r) Cash flow statement advances to promoters, directors, key managerial

Note 4: Property, plant and equipment

Cash flows are reported using indirect method, whereby net personnel (KMP) and related parties, details of benami

Net carrying amount as at 31st March, 2020

property held etc.

Net carrying amount as at 31st March, 2021

profits before tax is adjusted for the effects of transactions
of a non-cash nature and any deferrals or accruals of past
Statement of Profit and Loss:
or future cash receipts or payments and items of income or

Depreciation charge during the year

Depreciation charge during the year

Opening accumulated depreciation

Opening accumulated depreciation

expenses associated with investing or financing cash flows. - Additional disclosures relating to Corporate Social

Accumulated depreciation
Opening gross carrying amount

Opening gross carrying amount

cost of fixed assets.

Responsibility (CSR), undisclosed income and

Year ended 31st March , 2020

Year ended 31st March, 2021

The cash flows from regular revenue generating (operating

Accumulated depreciation
activities), investing and financing activities of the Group crypto or virtual currency specified under the head

Additions during the year

Additions during the year

Disposals during the year
Disposals during the year

Disposals during the year

Disposals during the year
Gross carrying amount

Gross carrying amount

‘additional information’ in the notes forming part of
are segregated.
the standalone financial statements.
s) Segment Reporting
The said amendments will be given effect by the Company
Particulars

Operating segments are reported in a manner consistent for period starting 1st April, 2021.
with the internal reporting provided to the Chief Operating

204 205
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

Note 5: Other intangible assets ` million Note 7: Investments ` million

Particulars Computer Website Brands / Total Particulars As at 31st March, 2021 As at 31st March, 2020
software Development Trade Marks Quantity (Nos) Value Quantity (Nos) Value
Year ended 31st March, 2020 Unquoted
Gross carrying amount Investment in equity instruments (fully paid-up)
Opening gross carrying amount 60.48 0.12 4.88 65.48 Investment in other entities (fair value through Profit and Loss)
Additions during the year 2.90 - 8.60 11.50 OPGS Power Gujarat Private Limited 2,18,000 - 2,18,000 -
Closing gross carrying amount as at 31st March, 2020 63.38 0.12 13.48 76.98 Rupee Co-Operative Bank Ltd. 3,800 - 3,800 -
Accumulated amortisation Other Investments
Opening accumulated amortisation 30.45 0.12 0.45 31.02 Investment in other entities which are carried at amortised cost
Amortisation charge for the year 18.48 - 0.97 19.45 Sharad Sahakari Bank Ltd. 318 0.02 318 0.02
Closing accumulated amortisation up to 31st March, 2020 48.93 0.12 1.42 50.47 SVC Bank Ltd 200 0.00 -
Closing net carrying amount as at 31st March, 2020 14.45 - 12.06 26.51 Investment in mutual fund (fair value through Profit and Loss)
Year ended 31st March, 2021 PFG-Union Balanced Advantage Fund Regular Plan - Growth 4,99,990 6.96 4,99,990 4.77
Gross carrying amount FSGP-IDBI Banking &Financial 1,00,000 1.22 1,00,000 0.73
Opening gross carrying amount 63.38 0.12 13.48 76.98 Total 8.20 5.52
Additions during the year 8.85 - - 8.85
Closing gross carrying amount as at 31st March, 2021 72.23 0.12 13.48 85.83 Total non-current investments 8.20 5.52
Accumulated amortisation Aggregate amount of quoted investments and market value thereof 8.18 5.50
Opening accumulated amortisation 48.93 0.12 1.42 50.47 Aggregate amount of unquoted investments 0.02 0.02
Amortisation charge for the year 14.60 - 1.33 15.93 Aggregate amount of impairment in the value of investments - -
Closing accumulated depreciation up to 31st March, 2021 63.53 0.12 2.75 66.40
Note: The investments is in compliance with Section 186(4) of the Companies Act, 2013.
Net carrying amount as at 31st March, 2021 8.70 - 10.73 19.43
Note 8: Loans - non current ` million
There are no contractual commitments for the acquisition of intangible assets.
Particulars As at As at
Note 6 : Biological asset other than bearer plant - Livestock (Cows) ` million 31st March, 2021 31st March, 2020
Particulars As at As at Unsecured considered good
31st March, 2021 31st March, 2020 Security Deposits 4.36 4.32
Balance beginning of the year 359.72 337.62 Total 4.36 4.32
Less: Decrease due to sale/disposal (22.80) (17.90)
Note 9: Other financial assets ` million
Add/(Less): Change in fair value less cost to sell #
65.68 40.00
Fair Value as at the end of the year 402.60 359.72 Particulars As at As at
31st March, 2021 31st March, 2020
#
Represents change in price as well as changes on account of biological transformation. There have been no new purchase/ Unsecured, considered good
acquisitions of biological assets.
Fixed deposits having original maturity of more than one year 3.33 2.61
Interest Receivable 0.03 -
Other Deposits 117.47 118.47
Total 120.83 121.08

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

Note 10: Other non-current assets ` million Note 13: Cash and cash equivalents ` million

Particulars As at As at Particulars As at As at
31st March, 2021 31st March, 2020 31st March, 2021 31st March, 2020
Unsecured, considered good Balances with banks
Capital advances 30.77 177.71 in current accounts 17.26 78.34
Prepaid expenses 8.44 9.40 Short term Bank deposits (Maturity within 3 months) 25.51 125.26
Total 39.21 187.11 Cash on hand 26.68 20.18
Total 69.45 223.78
Note 11 : Inventories (At lower of cost and net realisable value) ` million

Particulars As at As at Note 14: Bank balances (other than above) ` million

31st March, 2021 31st March, 2020 Particulars As at As at
Raw materials 111.22 103.74 31st March, 2021 31st March, 2020
Work-in-progress 4,879.23 3,840.44 Short term Bank deposits (Maturity more than 3 months but less than 12 months) 117.06 54.65
Finished goods 1,687.80 2,135.16 Total 117.06 54.65
Packing material 143.91 126.27
Note 15: Other current assets ` million
Stores and spares 125.69 123.25
Particulars As at As at
Total 6,947.85 6,328.86
31st March, 2021 31st March, 2020
Note: For Inventories pledged as securities against borrowings, see note 18 and note 21. Advances other than Capital advances
Unsecured, considered good:
The above includes goods in transit as below: ` million Prepaid expenses 14.55 15.69
Advances and other recoverables 2,324.32 1,202.03
Particulars As at As at
Recoverable from statutory and government authorities
31st March, 2021 31st March, 2020
Unsecured, considered good:
Stock in transit - finished goods 18.35 8.17 Electricity duty receivable 22.20 22.20
PSI incentive and export subsidy receivable 647.75 607.04
Note: The cost of inventories recognised as an expense includes ` 16.17 million (31st March, 2020: ` 12.60 million) in respect of
Milk incentive receivable 86.20 216.51
write down of inventories to net realizable value. Further, a sum of ` 12.60 million (31st March, 2020: ` 0.65 million) in respect
GST, VAT and Sales tax receivable 39.75 45.44
of reversal of such write downs. Previous write downs have been reversed as a result of appreciation in market price of such
Interest receivable 0.01 8.61
inventories.
Unsecured, considered doubtful
Note 12: Trade receivables ` million Advances and other recoverables 21.64 21.18
Recoverable from statutory and government authorities 25.24 25.24
Particulars As at As at
Less: Allowances for doubtful advances (46.88) (46.42)
31st March, 2021 31st March, 2020
Unsecured, considered good:
Unsecured, Considered good 1,589.48 3,034.79 Interest receivable 0.07 7.57
Unsecured, Considered doubtful 991.59 1,162.68 Grand Total 3,134.85 2,125.09
Less: Allowance for doubtful debts (991.59) (1,162.68)
Note 16: Equity share capital
Total 1,589.48 3,034.79
(a) Authorised equity share capital ` million
Note: Particulars Number of shares Face Value Amount
(Nos.)
(a) No trade receivables are due from directors or other officers of the Group either severally or jointly with any other person.
As at 1st April, 2019 10,00,00,000 10.00 1,000.00
Nor any trade and other receivables are due from firms or private companies respectively in which any directors is a partner,
Change during the year - - -
a director or a member.
As at 31st March, 2020 10,00,00,000 10.00 1,000.00
(b) The Group’s exposure to credit and currency risk related to trade receivables are disclosed in Note 38 A and Note 38 C. Change during the year - - -
As at 31st March, 2021 10,00,00,000 10.00 1,000.00
(c) Trade receivables stated above are charged on a first pari-passu basis between working capital consortium members led by
Union Bank of India, State Bank of India and IDBI Bank Ltd.

208 209
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

(b) Issued, subscribed and fully paid up share capital ` million Note 17: Other Equity ` million
Particulars Number of shares Face Value Amount Particulars As at As at
(Nos.) 31st March, 2021 31st March, 2020
As at 1st April, 2019 Securities Premium 4,447.85 4,447.85
Issued subscribed and fully paid up share capital (including share issued to ESOP Trust) 8,41,14,582 10.00 841.15
General Reserve 59.26 59.26
Less: Amount recoverable from ESOP Trust (face value of 1,76,015 share allotted to 1,76,015 10.00 1.76
the Trust) Retained Earnings 3,927.77 3,762.79

Net Issued, subscribed and fully paid up share capital 8,39,38,567 10.00 839.39 Employee Stock Options Outstanding 7.29 8.27
Add: Issued during the year by ESOP Trust to employees (refer note 48) - 10.00 - Other Comprehensive Income (0.14) (5.94)
As at 31st March, 2020 8,39,38,567 839.39 Total 8,442.03 8,272.23
Issued subscribed and fully paid up share capital (including share issued to ESOP Trust) 8,41,14,582 10.00 841.15
Less: Amount recoverable from ESOP Trust (face value of 1,76,015 share allotted to 1,76,015 10.00 1.76 Note: For movements in reserves - refer Statement of Changes in Equity.
the Trust)
Net Issued, subscribed and fully paid up share capital 8,39,38,567 10.00 839.39
Nature and purpose of reserves
Add: Issued during the year by ESOP Trust to employees (refer note 48) - 10.00 -
(a) The amount received in excess of face value of the equity shares is recognised in the securities premium. This reserve will be
As at 31st March, 2021 8,39,38,567 10.00 839.39 utilised in accordance with the provisions of Section 52 of the Companies Act, 2013 (“the Act”).
(c) Terms and rights attached to equity shares
(b) General reserve is created from time to time by transferring profits from retained earnings and can be utilised for purposes
The Holding Company has only one class of shares referred to as equity shares having a par value of ` 10 per share. Each holders such as dividend payout, bonus issue, etc
of equity shares carry one vote per share without restrictions and are entitled to dividend, as and when declared. In the event of
(c) Retained earnings are the profits that the Company has earned till date, net-off less any transfers to general reserve, dividends
liquidation of the Holding Company, the holders of equity shares will be entitled to receive the remaining assets of the Holding
or other distribution to the shareholders.
Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held
by the shareholders. (d) The shares option outstanding account is used to recognise the grant date fair value of options issued to employees under the
Employee Stock Grant Scheme which are invested as on the reporting date and is net of the deferred employee compensation
(d) Details of shareholders holding more than 5% shares
expense.

Particulars As at As at Note 18: Borrowings - Non-current ` million

31st March, 2021 31st March, 2020
Particulars As at As at
Number of shares % Number of shares % holding
31st March, 2021 31st March, 2020
(Nos.) holding (Nos.)
Measured at amortised cost
Equity shares of ` 10 each fully paid
Secured
Mr. Devendra Prakash Shah 1,52,06,400 18.12% 1,52,06,400 18.12%
Term loans
Mr. Pritam Prakash Shah 91,59,888 10.91% 91,59,888 10.91%
From banks
Mrs. Netra Pritam Shah 88,67,027 10.56% 88,67,027 10.56%
Rupee currency loan 436.64 395.64
Stichting Depositary APG Emerging Markets Equity Pool - 0.00% 61,28,938 7.30%
Foreign currency loan 177.10 361.40
IDFC Trustee Co. Ltd A/C IDFC Infrastructure Fund 50,42,534 6.01% 50,42,534 6.01%
Vehicle loan 21.63 25.83
(e) As per records of the Company, including its register of shareholders/members, the above shareholding represents legal From other than banks
ownerships of shares. The above percentage have been computed after excluding 176,015 nos (31st March, 2020 176,015 nos) of Vehicle loan - 0.89
equity shares issued to ESOS Trust. 635.37 783.76
Less: Current maturity (302.18) (302.28)
(f) The Company has not issued any equity shares pursuant to contract without payment being received in cash or by way of bonus
shares or bought back any equity shares during the last five years preceding the balance sheet date. Total 333.19 481.48

(g) The Board of Directors have recommended payment of final dividend of ` 0.50 (Fifty Paisa only) per equity share of the face Note:
value of ` 10 each for the financial year ended 31st March, 2021. The total dividend for the year paid is ` 0.50 (Fifty Paisa only) per (a) Indian rupee loans taken by the Holding Company from a bank of ` 436.64 million (31st March, 2020 : ` 395.64 million) carry
equity share of the face value of ` 10 each. interest @ 9.15%-10.10%. The loans are repayable over 13-59 monthly instalments starting from March 2018, June 2019, July
2019, August 2019, September 2019, December 2019 and September 2020 along with interest. The loan is secured by pari
pasu charge on fixed assets and second pari pasu charge on current assets of the Holding Company and personal guarantee
of Promoter Directors.

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

(b) Foreign currency loan taken by the Holding Company from a financial institution of ` 177.10 million (31st March, 2020: ` Note : Disclosure under Micro, Small, and Medium Enterprises Development Act, 2006 :
361.40 million) carries interest @ 4.50%-6.19%. The loans are repayable in 12 semi annual instalments along with interest
starting from June, 2016. The loan is secured by first pari passu charge on movable and immovable fixed property of the (a) Micro, Small and Medium enterprises have been identified by the Company on the basis of the information available. Total
Holding Company and second pari pasu charge of entire current assets of the Holding Company along with other banks and outstanding dues to suppliers which are outstanding for more than the stipulated period and other disclosures as per the Micro,
personal guarantees of Directors and their relatives. Small and Medium Enterprises Development Act, 2006, (MSMED Act) as at 31st March, 2021. The disclosure pursuant to the said
Act is as under:
(c) Hire purchase loan taken by the Holding Company from banks of ` 21.63 million (31st March, 2020 : ` 25.83 million) carries ` million
interest @ 9.20% to 9.35 % p.a. The loans are repayable in 60 monthly instalments starting from December 2018 and
November 2018. The loan is secured by specific assets financed (vehicle). Particulars 31st March, 2021 31st March, 2020
/2020-21 /2019-20
(d) Indian rupee loans taken by the Holding Company from financial institutions of ` Nil million (31st March, 2020 : ` 0.89 million)
represents loan secured by hypothecation of equipments and vehicles. The loans are repayable over 36 - 60 instalments and The principal amount and the interest due thereon remaining unpaid to any supplier at the
carry interest in the range of 11.72%. end of each accounting year
Principal 8.97 17.48
(e) Average interest rate for the non-current borrowings is 8.34%
Interest 8.92 7.55
Note 19: Other financial liability ` million The amount of interest paid by the buyer in terms of Section 16 of the MSMED Act, 2006 - -
along with the amount of the payment made to the supplier beyond the appointed day
Particulars As at As at
during each accounting year
31st March, 2021 31st March, 2020
The amount of interest due and payable for the period of delay in making payment (which 35.75 37.73
Lease liability 85.92 112.14
have been paid but beyond the appointed day during the year) but without adding the
Total 85.92 112.14 interest specified under the MSMED Act, 2006
The amount of interest accrued and remaining unpaid at the end of each accounting year 8.92 7.55
Note 20: Provisions - Non-current ` million
The amount of further interest remaining due and payable even in the succeeding years, 8.92 7.55
Particulars As at As at until such date when the interest dues as above are actually paid to the small enterprise, for
31st March, 2021 31st March, 2020 the purpose of disallowance as a deductible expenditure under Section 23 of the MSMED
Provision for compensated absences (refer note 40) 2.95 2.83 Act, 2006
Provision for gratuity (net) (refer note 40) 39.05 42.27
(b) The information has been given in respect of such vendors to the extent they could be identified as micro and small enterprises
Total 42.00 45.10 on the basis of information available with the Company.

Note 21: Borrowings - current ` million Note 23: Other current financial liabilities ` million
Particulars As at As at Particulars As at As at
31st March, 2021 31st March, 2020 31st March, 2021 31st March, 2020
Secured Current maturities of long-term debt (refer note 18) 302.18 302.28
Loans repayable on demand
Interest accrued but not due on borrowings 12.65 14.11
From banks- cash credit 3,175.24 3,167.10
Deposits 95.34 211.83
Unsecured
Employee related Liabilities 98.17 88.32
From banks- cash credit - 48.58
Total 3,175.24 3,215.68 Trade payable for capital goods other than payable to Micro and Small Enterprises 86.57 156.81
Directors remuneration payable (refer note 42) 8.05 2.77
Note: Lease liability 26.22 28.14
(a) Cash credit availed from banks by Holding Company are secured by first pari pasu charge on all current assets and second Book overdrawn balance - 0.11
pari pasu charge on fixed assets of the Holding Company, personal guarantee of Promoter Directors and their relative. The Total 629.18 804.26
cash credit is repayable on demand and carries interest @ 7.75% p.a. to 11.60% p.a.
Note 24: Other Current Liabilities ` million
Note 22: Trade payables - current ` million
Particulars As at As at
Particulars As at As at 31st March, 2021 31st March, 2020
31st March, 2021 31st March, 2020 Statutory dues payables 221.68 103.66
(A) total outstanding dues of micro enterprises and small enterprises; and 8.97 25.41 Advances from customers 9.51 1.24
(B) total outstanding dues of creditors other than micro enterprises and small enterprises. 3,032.33 2,915.00 Total 231.19 104.90
Total 3,041.30 2,940.41

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Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

Note 25: Provisions - Current ` million Note 28: Other income ` million

Particulars As at As at Particulars 2020-21 2019-20

31st March, 2021 31st March, 2020 Interest income
Bank deposits 8.71 13.73
Provision for compensated absences (refer note 40) 4.53 4.35
Security deposit 0.68 1.82
Provision for gratuity (net) (refer note 40) 0.25 0.23 Others 11.10 9.57
Total 4.78 4.58 Foreign exchange fluctuation (net) 9.37 (5.15)
Customer advances written back 24.78 5.58
Note 26: Current tax liabilities (net) ` million Net gain / (loss) on sale or fair valuation of investments 2.68 0.21
Fair value changes in Livestock 65.68 40.00
Particulars As at As at
Miscellaneous income 12.09 10.23
31st March, 2021 31st March, 2020 Total 135.09 75.99
Current tax liabilities (net) 1.07 79.87
Note 29: Cost of materials Consumed ` million
Total 1.07 79.87
Particulars 2020-21 2019-20
Note 27 : Revenue from Operations ` million Raw material consumed
Opening Stock 103.74 138.37
Particulars 2020-21 2019-20
Add: Purchases 11,798.36 16,060.35
A. Sale of Products (excluding GST, as applicable):
Add: Purchase of fodder/ generation of raw manure 276.50 313.60
Sale of manufactured goods 16,652.39 22,011.34
Less: Closing Stock (111.22) (103.74)
Sale of traded goods 1,210.56 1,797.15 12,067.38 16,408.58
Sale of milk products 9.54 113.84 Packing materials, stores spares and consumables consumed
Sales of Cattle Feed 34.03 55.69 Opening Stock 249.52 258.18
Sale of milk - Compost manure 35.26 35.02 Add: Purchases 1,187.92 1,252.68
17,941.78 24,013.04 Less: Closing Stock (269.59) (249.52)
B. Other operating revenues comprise: 1,167.85 1,261.34
Processing charges 306.41 71.60 Total 13,235.23 17,669.92
Export benefits and incentives 4.32 9.61
PSI incentive 157.19 212.97 Note 30: Purchase of Stock in trade ` million
Milk incentive - 63.22 Particulars 2020-21 2019-20
Scrap sale 7.93 8.80 Milk products 975.31 2,220.30
475.85 366.20 Total 975.31 2,220.30
Total (A+B) 18,417.63 24,379.24
Note 31: Changes in inventories of finished goods, stock-in-trade and work-in-progress ` million
Note : Particulars 2020-21 2019-20
(a) In accordance with Indian Accounting Standard (Ind AS) 20, Accounting for Government Grants and Disclosure of Government Inventories - Milk Products
Assistance, the Company has accounted for Industrial Promotion Subsidy under Package Scheme of Incentives, 2013 Opening Stock:
amounting to ` 157.19 million (31st March, 2020: ` 212.97 million) as Other Operating Income in Statement of Profit and Loss. Finished goods 2,135.16 1,404.10
Work-in progress 3,840.44 2,828.14
(b) The Company has also accounted for Milk subsidy amounting to ` Nil million (31st March, 2020: 63.22 million) and export 5,975.60 4,232.24
subsidy amounting to ` million 4.32 (31st March, 2020: ` 9.61 million) as Other Operating Income in Statement of Profit and Less:
Loss. Closing Stock:
Finished goods 1,687.80 2,135.16
(c) Revenue from operations- Geograhpical information ` million Work-in progress 4,879.23 3,840.44
6,567.03 5,975.60
Particulars 2020-21 2019-20 Changes in inventories:
Within India 18,090.00 23,996.04 Finished goods 447.36 (731.06)
Outside India 327.63 383.20 Work-in progress (1,038.79) (1,012.30)
(591.43) (1,743.36)
Total 18,417.63 24,379.24

(d) Performance obligation in respect of sale of goods is satisfied when control of the goods is transferred to the customer,
generally on delivery of the goods and payment is generally due as per the terms of contract with customers

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Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

Note 32: Employee benefits expense ` million # Details of payments to auditors ` million

Particulars 2020-21 2019-20 Particulars 2020-21 2019-20

Salaries and wages 697.90 853.36
Payment to the auditors (included in miscellaneous expenses)
Contributions to provident and other funds (refer note 40) 33.08 42.21
Gratuity (refer note 40) 11.54 12.71 Auditors remuneration (excluding taxes):
Staff welfare expenses 40.43 49.38 Audit fees 3.17 4.36
Share-based Payments to employees (refer note 48) (0.98) 3.38
Other services 0.53 0.75
Total 781.97 961.04
Certification work - -
Note 33: Finance costs ` million Re-imbursement of expenses - 0.02
Total 3.70 5.13
Particulars 2020-21 2019-20
Interest on debts and borrowings 447.12 357.52
Other Borrowing Cost 10.62 23.52
Total 457.74 381.04

Note 34: Depreciation and amortisation expenses ` million

Particulars 2020-21 2019-20

Depreciation of property, plant and equipment 469.82 497.72
Amortisation of intangible assets 15.93 19.45
Depreciation of Right of use assets 32.23 19.24
Total 517.98 536.41

Note 35: Other expenses ` million

Particulars 2020-21 2019-20
Transport, octroi and freight 689.03 848.47
Power and fuel 381.25 358.02
Rent (refer note 43) 166.79 109.42
Rates and taxes 91.76 90.44
Insurance 27.40 12.17
Repairs and maintenance
- plant and equipments 61.34 70.91
- building 7.29 6.06
- others 11.76 10.63
Other factory expenses 120.41 193.81
labour charges 197.80 202.80
Security charges 17.12 20.11
Travelling and conveyance 22.18 55.32
Legal and professional fees (refer note 42) 139.94 144.41
Sales promotion, commission and advertisement 393.39 576.58
Allowance for doubtful debts and advances (net) 131.29 98.89
CSR expenses (refer Note 47) 40.56 10.78
Miscellaneous expenses 249.28 332.74
Hire charges 3.70 3.55
Loss on sale or death of livestock 16.39 15.21
Total 2,768.68 3,160.32

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Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

Note 36: Disclosure pursuant to Indian Accounting Standard (Ind AS) 12, Income Taxes (contd..)
` million

` million
Net balance
in OCI 31st March, 2021

245.05
45.90
-
290.95

261.93
-
16.77
34.82
313.52

8.29
8.29
30.86

Net balance
in OCI 31st March, 2020

351.56
27.63
11.72
390.91

423.93
1.04
17.38
11.58
453.93

25.24
25.24
88.26
(b) Income tax expense ` million
Particulars For the period ended For the period ended
31st March, 2021 31st March, 2020
Current tax
Current tax on profits for the year 61.12 297.88
Recognised

-
-
-
-

-
-
1.89
-
1.89

-
-
1.89

Recognised

-
-
-
-

-
0.54
(1.91)
-
(1.37)

-
-
(1.37)
(a) The major components of recognised deferred tax assets/(liabilities) arising on account of temporary differences are as follows:

Adjustments for current tax of prior periods 75.57 (42.26)

Total 136.69 255.62
Deferred tax
Deferred tax charge/(credit) 9.66 23.21
MAT Credit entitlement 53.85 53.85
Recognised in
profit or loss

(106.51)
18.27
(11.72)
(99.96)

(162.00)
(1.04)
(2.50)
23.24
(142.30)

(16.95)
(16.95)
(59.29)

Recognised in
profit or loss

56.80
-
1.10
57.90

34.29
0.50
0.36
(0.46)
34.69

(53.85)
(53.85)
(77.06)
Total 63.50 77.06
Income tax expense 200.19 332.68

(c) Reconciliation of effective tax rate: ` million

Particulars 2020-2021 2019-2020

Net balance
1st April, 2020

351.56
27.63
11.72
390.91

423.93
1.04
17.38
11.58
453.93

25.24
25.24
88.26

Net balance
1st April, 2019

294.76
27.63
10.62
333.01

389.64
-
18.93
12.04
420.61

79.09
79.09
166.69
Profit before tax 407.24 1,269.56
Applicable tax rate* 25.17% 34.61%
Expected income tax expense 102.49 439.37
Tax effect of adjustments to reconcile expected income tax expense to reported
Note 36: Disclosure pursuant to Indian Accounting Standard (Ind AS) 12, Income Taxes

income tax expense:

Effect of non deductible expenses (31.17) 53.76
Effect of tax exempt income (exemption under section 80IB) - (168.32)
Effect of tax adjustment in respect of earlier years 75.57 (42.26)
Effect of deferred tax in respect of earlier years - 0.57
Effect of change in tax rate* 28.94 -
Others 24.45 49.55
Income tax expense 200.28 332.67
Effective tax rate 49.18% 26.20%

* The Company has elected to exercise the option permitted under Section 115BAA of the Income tax Act, 1961 as introduced by
Property, plant and equipment and Intangible assets

Property, plant and equipment and Intangible assets

the Taxation Laws (Amendment) Act, 2019. Accordingly, the Company has recognised provision for income tax for year ended
31st March, 2021.
For the year ended 31st March, 2021

(d) Amounts recognised in Other comprehensive income ` million

For the year ended 31st March, 2020
Expected credit loss on financial assets

Expected credit loss on financial assets

Particulars 2020-2021 2019-2020

Minimum Alternate Tax (MAT) credit

Minimum Alternate Tax (MAT) credit

Expenses allowed on payment basis

Expenses allowed on payment basis

Net Deferred tax assets/(liabilities)

Net Deferred tax assets/(liabilities)

Before tax Tax exp. Net of tax Before tax Tax exp. Net of tax
(benefit) (benefit)
Items that will not be reclassified to profit or loss
Remeasurement of the defined benefit plans 7.75 (1.95) 5.80 5.47 (1.91) 3.56
Deferred tax liabilities

Deferred tax liabilities

Fair value of livestock

Fair value of livestock

Deferred tax assets

Deferred tax assets

Unabsorbed losses

Unabsorbed losses

Note 37: Disclosure pursuant to Indian Accounting Standard (Ind AS) 107, Financial Instruments - Disclosures
A. Accounting classification and fair values
Recognised

Recognised
Particulars

Particulars
Ind AS 116

Ind AS 116
Sub-Total

Sub-Total

Sub-Total

Sub-Total

Sub-Total

Sub-Total

The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their
Others

Others

levels in the fair value hierarchy. It does not include fair value information for financial assets and financial liabilities not
measured at fair value if the carrying amount is a reasonable approximation of fair value.

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 Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

B.
Measurement of fair value ` million
As at 31st March 2020 Carrying amount Fair value Total
The fair values of the financial assets and liabilities are included at the amount at which the instrument could be exchanged
FVTPL Amortised Cost Total Level 1 Level 2 Level 3
in a current transaction between willing parties, other than in a forced or liquidation sale.
Financial assets
Fair value of cash and short-term deposits, trade and other short term receivables, trade payables, other current liabilities, Other non-current financial assets
Investments - mutual funds 5.50 - 5.50 5.50 - - 5.50
short term loans from banks and other financial institutions approximate their carrying amounts largely due to short term
Investments - Others 0.02 - 0.02 - - 0.02 0.02
maturities of these instruments.
Others
C. Fair Value Hierarchy Loans - 4.32 4.32 - - - -
Other financial assets (non current) - 121.08 121.08 - - - -
The fair value of financial instruments as referred to above have been classified into three categories depending on the inputs
Trade receivable - 3,034.79 3,034.79 - - - -
used in the valuation technique. The hierarchy gives the highest priority to quoted prices in active markets for identical
Cash and cash equivalents - 223.78 223.78 - - - -
assets or liabilities (Level 1 measurements) and lowest priority to unobservable inputs (Level 3 measurements).
Other bank balance - 54.65 54.65 - - - -
Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments, Total 5.52 3,438.62 3,444.14 5.50 - 0.02 5.52
traded bonds and mutual funds that have quoted price. The fair value of all equity instruments which are traded in the stock Financial liabilities
exchanges is valued using the closing price as at the reporting period. Borrowings - non-current - 481.48 481.48 - - - -
Borrowings - current - 3,215.68 3,215.68 - - - -
Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques Trade payables - 2,940.41 2,940.41 - - - -
which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant Current maturities of long term - 302.28 302.28 - - - -
inputs required to fair value an instrument are observable, the instrument is included in level 2. borrowings
Other financial liabilities - 501.98 501.98 - - - -
Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. Total - 7,441.83 7,441.83 - - - -
This is the case for unlisted equity securities included in level 3.
Note 38: Financial Risk Management
` million Risk management framework

As at 31st March 2021 Carrying amount Fair value Total The Group has in place a mechanism to inform the Board about the risk assessment and minimization procedures and periodical
FVTPL Amortised Cost Total Level 1 Level 2 Level 3 review to ensure that management controls risk through means of a properly defined framework. The Group has formulated and
Financial assets adopted Risk Management Policy to prescribe risk assessment, management, reporting and disclosure requirements of the Group.
Other non-current financial assets
The audit committee of the holding company also oversees how management monitors compliance with the Group’s risk
Investments - mutual funds 8.18 - 8.18 8.18 - - 8.18
management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced
Investments - Others 0.02 - 0.02 - - 0.02 0.02 by the Group. The audit committee is assisted in its oversight role by internal audit. Internal audit undertakes both regular and ad
Others hoc reviews of risk management controls and procedures, the results of which are reported to the audit committee.
Loans - 4.36 4.36 - - - -
Other financial assets (non current) - 120.83 120.83 - - - - The Company’s principal financial liabilities, other than derivatives, comprises of borrowings, trade and other payables. The main
Trade receivable - 1,589.48 1,589.48 - - - - purpose of these financial liabilities is to finance the Company’s operations. The Company’s principal financial assets include
Cash and cash equivalents - 69.45 69.45 - - - - investments in equity shares, loans, trade and other receivables, and cash and cash equivalents that the Company derives directly
Other bank balance - 117.06 117.06 - - - - from its operations. The Company also holds FVTOCI/FVTPL investments.
Total 8.20 1,901.18 1,909.38 8.18 - 0.02 8.20
The Group’s activities expose it to market risk, liquidity risk and credit risk. The Group’s primary focus is to foresee the unpredictability
Financial liabilities
of financial markets and seek to minimize potential adverse effects on its financial performance.
Borrowings - non-current - 333.19 333.19 - - - -
Borrowings - current - 3,175.24 3,175.24 - - - - This note explains the sources of risk to which the Group is exposed to and how the entity manages the risk.
Trade payables - 3,041.30 3,041.30 - - - -
Current maturities of long term - 302.18 302.18 - - - - (A) Credit risk
borrowings Trade and Other receivables
Other financial liabilities - 327.00 327.00 - - - -
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet
Total - 7,178.91 7,178.91 - - - -
its contractual obligations, and arises principally from the Group’s trade and other receivables. The carrying amounts of
financial assets represent the maximum credit risk exposure.

Trade receivables are typically unsecured and are derived from revenue earned from customers located in India. Credit risk
has always been managed by the Group through credit approvals, establishing credit limits and continuously monitoring

220 221
 Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

the credit worthiness of customers to which the Group grants credit terms in the normal course of business. In monitoring (i) Maturities of financial liabilities
customer credit risk, customers are Grouped according to their credit characteristics, including whether they are General The following are the remaining contractual maturities of financial liabilities at the reporting date. The amounts are gross and
trade, Modern trade, Institutional and Horeca customers. Outstanding customers are regularly monitored. undiscounted.

Summary of the Company’s exposure to credit risk by age of the outstanding from various customers is as follows: ` million

` million Contractual maturities of financial liabilities Carrying 1 year or less 1-2 years 2- 5 years Total
31st March, 2021 value
Particulars 31st March, 2021 31st March, 2020 Non-derivatives financial liabilities
Outstanding for a period not exceeding six months 1,500.20 2,946.26 Borrowings - non-current 635.37 302.18 130.93 136.30 569.41
Borrowings - current 3,175.24 3,175.24 - - 3,175.24
Outstanding for a period exceeding six months 1,080.87 1,251.21
Trade payables 3,041.30 3,041.30 - - 3,041.30
Gross trade receivables 2,581.07 4,197.47 Lease rent payable 112.14 26.22 29.33 56.59 112.14
Less: Provision for doubtful debts (991.59) (1,162.68) Other financial liabilities 300.78 300.78 - - 300.78
Net trade receivables 1,589.48 3,034.79 Total 7,264.83 6,845.72 160.26 192.89 7,198.87

` million
On account of adoption of Ind AS 109, the Group uses expected credit loss model to assess the impairment loss. The Group
computes the expected credit loss allowance as per simplified approch for trade receivables based on available external and Contractual maturities of financial liabilities Carrying 1 year or less 1-2 years 2- 5 years Total
internal credit risk factors such as the ageing of its dues, market information about the customer and the Group’s historical 31st March, 2020 value
experience for customers. The Group has used a practical expedient by computing the expected credit loss allowance for Non-derivatives financial liabilities
trade receivables based on a provision matrix. The provision matrix takes into account historical credit loss experience and Borrowings - non-current 783.76 272.96 302.18 208.62 783.76
is based on the ageing of the receivable days and the rates as given in the provision matrix. Borrowings - current 3,215.68 3,215.68 - - 3,215.68
Trade payables 2,940.41 2,940.41 - - 2,940.41
The movement in the loss allowance in respect of trade and other receivables during the year was as follows
Lease rent payable 140.29 28.14 26.22 85.93 140.29
Other financial liabilities 473.84 473.84 - - 473.84
Loss allowance on trade receivables Amount
Total 7,553.98 6,931.03 328.40 294.55 7,553.98
in ` million
Balance as at 1st April, 2019 1,065.89 (C) Market risk
Less: Write-off of bad debts -
Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from adverse changes in
Add: Impairment loss recognised 96.79
market rates and prices (such as interest rates and foreign currency exchange rates) or in the price of market risk-sensitive
Balance as at 31st March, 2020 1,162.68
instruments as a result of such adverse changes in market rates and prices. Market risk is attributable to all market risk-
Less: Write-off of bad debts (297.36)
sensitive financial instruments, all foreign currency receivables and payables and all short-term and long-term debt. The
Add: Impairment loss recognised 126.27
group is exposed to market risk primarily related to foreign exchange rate risk and interest rate risk.
Balance as at 31st March, 2021 991.59
(i) Foreign currency risk
(B) Liquidity risk
The group is subject to risk of changes in foreign currency values that impact costs of imported raw material and import
Liquidity risk is the risk that the group will encounter difficulty in meeting the obligations associated with its financial liabilities
of equipment for expansion of plants, primarily with respect to USD and EURO. The group’s business model incorporates
that are settled by delivering cash or another financial asset. The group’s approach to managing liquidity is to ensure, as far as
assumptions on currency risks and ensures any exposure is covered through the normal business operations.
possible, that it will have sufficient liquidity to meet its liabilities when they are due. Management monitors rolling forecasts
of the group’s liquidity position (comprising the undrawn borrowing facilities) and cash and cash equivalents on the basis of The group has not entered into any derivative transactions during the year and there were no derivative transactions
expected cash flows. The group’s objective is to maintain a balance between continuity of funding and flexibility through the outstanding as on 31st March, 2021.
use of bank overdraft/ cash credit facility. The group also monitors the level of expected cash inflows on trade receivables
together with expected cash outflows on trade payables and other financial liabilities. The group has access to a sufficient
sources of short term funding with existing lenders that could be arrange upon should there be need.

222 223
 Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

(a) The group unhedged exposure to foreign currency risk are as follows ` million (a) Interest rate risk exposure

As at As at Company’s interest rate risk arises from borrowings. The interest rate profile of the Company’s interestbearing financial
31st March 2021 31st March 2020 instruments as reported to the management of the Company is as follows.

Sr Particulars Currency INR Foreign currency INR Foreign currency ` million

no Particulars As at As at
A Financial assets 31st March 2021 31st March 2020
(i) Trade receivables USD 34.19 0.47 11.17 0.15 Fixed rate instruments and variable rate instruments
B Financial liabilities Financial assets
(i) Foreign currency loan Bank deposits 145.90 182.52
Bank loan USD 177.10 2.41 361.40 4.79 Total 145.90 182.52
Interest payable USD 2.32 0.03 6.11 0.08 Financial liabilities
(ii) Trade payables USD 0.08 0.00 8.74 0.12 Non-current borrowings 333.19 481.48
EURO 10.08 0.12 39.11 0.47 Current maturities of non-current borrowings 302.18 302.28
AUD 2.50 0.05 1.50 0.03 Current borrowings 3175.24 3215.68
GBP 0.07 0.00 0.06 0.00 Total 3810.61 3999.44

(b) Sensitivity (b) Cash flow sensitivity analysis for variable-rate instruments
A reasonably possible strengthening (weakening) of the Indian Rupee against various currency mentioned in the table below The sensitivity analysis below has been determined based on the exposure to interest rates at the end of the reporting period.
as at 31st March would have affected the measurement of financial instruments denominated in foreign currency and affected For floating rate liabilities, the analysis is prepared assuming that the amount of the liability as at the end of the reporting
equity and profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular interest period was outstanding for the whole year. A 100 basis point increase or decrease is used when reporting interest rate risk
rates, remain constant and ignores any impact of forecast sales and purchases. internally to key management personnel and represents Management’s assessment of the reasonably possible change in
interest rates. This analysis assumes that all other variables, in particular foreign currency exchange rates, remain constant.
Profit / (loss) before tax gain / (loss) Equity, gross of tax
Strengthening Weakening Increased (Decreased) ` million
31st March, 2021 Particulars Impact on profit /(loss) - Increase /
Effect in INR (Decrease) in profit
1% movement
31st March, 2021 31st March, 2020
USD 1.45 (1.45) 1.45 (1.45)
EUR 0.10 (0.10) 0.10 (0.10) Interest rates – increase by 100 basis points * (37.88) (39.23)

AUD 0.03 (0.03) 0.03 (0.03) Interest rates – decrease by 100 basis points * 37.88 39.23
GBP 0.00 (0.00) 0.00 (0.00)
* Holding all other variables constant
31st March, 2020
Effect in INR Note 39: Capital Management
1% movement
For the purpose of the Group’s capital management, capital includes issued equity capital and all other equity reserves attributable
USD 3.65 (3.65) 3.65 (3.65)
to the equity holders of the Group. The primary objective of the Group’s capital management is to safeguard the Company’s ability
EUR 0.39 (0.39) 0.39 (0.39)
to remain as a going concern and maximise the shareholder value.
AUD 0.01 (0.01) 0.01 (0.01)
GBP 0.00 (0.00) 0.00 (0.00) The Group manages its capital structure and makes adjustments in light of changes in economic conditions, annual operating
plans, long term and other strategic plans and the requirements of the financial covenants. To maintain or adjust the capital
(i) Cash flow and fair value interest rate risk
structure, the Holding Company may adjust its dividend payment (refer note 17) ratio to shareholders, return capital to shareholders
Interest rate risk is the risk that the fair value or future cashflows of a financial instrument will fluctuate because of changes or issue fresh shares.
in market interest rates. The group main interest rate risk arises from long-term borrowings with variable rates, which expose
the group to cash flow interest rate risk. The Group monitors capital using a ratio of ‘adjusted net debt’ to ‘equity’. For this purpose, adjusted net debt is defined as
liabilities, comprising interest-bearing loans and borrowings less cash and cash equivalents. Equity comprises all components of
The group’s borrowings are carried at amortised cost. They are therefore not subject to interest rate risk as defined in Ind AS equity including share premium and all other equity reserves attributable to the equity share holders.
107, Financial Instruments: Disclosures, since neither the carrying amount nor the future cash flows will fluctuate because of
a change in market interest rates.

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

The Group’s adjusted net debt to equity ratio at 31st March, 2021 was as follows. Based on the actuarial valuation obtained in respect of gratuity, the following table sets out the details of the employee
` million benefit obligation as at balance sheet date:
` million
Particulars 31st March, 2021 31st March, 2020
Borrowings Defined benefit plans 2020-21 2019-20
I Expenses recognised in statement of profit and loss during the year:
Long term and Short term borrowings 3,508.43 3,697.16
Current Service Cost 9.21 10.37
Current maturities of Long term borrowings 302.18 302.28 Past Service Cost - -
Less: cash and cash equivalents (215.35) (406.30) Interest cost on benefit obligation (1.30) (1.33)
Adjusted net debt 3,595.26 3,593.14 Expected return on plan assets 3.63 3.66
Total Equity 9,281.42 9,111.62 Total Expenses 11.54 12.70
II Expenses recognised in OCI
Adjusted net equity 9,281.42 9,111.62
Actuarial (Gain) / Losses due to Financial Assumption changes in DBO - 0.10
Adjusted net debt to adjusted equity ratio 0.39 0.39
Actuarial (Gain) / Loss due to Demographic Assumption changes in DBO - 2.16
Actuarial (Gain)/ Losses due to Experience on DBO (8.02) (8.05)
In order to achieve this overall objective, the Group’s capital management, amongst other things, aims to ensure that it meets
Return on Plan Assets (Greater) / Less than Disount rate 0.20 0.32
financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. There have
Total Expenses (7.82) (5.47)
been no breaches in the financial covenants of any interest-bearing loans and borrowing in the current period.
III Net Asset /(Liability) recognised as at balance sheet date:
No changes were made in the objectives, policies or processes for managing capital of the Group during the current and previous Present value of defined benefit obligation (65.14) (64.64)
year. Fair Value of Plan Assets 25.84 22.14
Funded status [Surplus/(Deficit)] (39.30) (42.50)
Note 40: Disclosure pursuant to Undia Accounting Standard (Ins AS) 19, Employee Benefits IV Movements in present value of defined benefit obligation
A. Defined contribution plan Present value of defined benefit obligation at the beginning of the year 64.64 55.41
The Group has recognised an amount of ` 33.10 million as expenses under the Defined Contribution Plans in the Statement Current Service Cost 9.21 9.92
of Profit & Loss as below: Past service cost - -
` million Interest Cost 3.74 3.56
Actuarial (Gain)/Loss (7.94) (5.99)
Benefit/Contribution to 2020-21 2019-20
Benefits paid (4.50) (2.04)
Provident Fund 27.87 35.05
Present value of defined benefit obligation at the end of the year 65.15 60.86
National Pension Scheme 0.60 0.98
V Movements in fair value of the plan assets
Employees State Insurance 4.61 6.16
Opening fair value of plan assets 22.13 20.04
Labour Welfare Fund 0.02 0.03
Expected returns on Plan Assets 1.42 1.44
Total 33.10 42.22
Actuarial (Gain)/Loss on Plan assets (0.20) (0.36)
B. Defined Benefit Plan- Gratuity Contribution from Employer 6.99 2.99
The holding company and its Indian subsidiary has an obligation towards gratuity, a defined benefit obligation. Every Benefits paid (4.50) (1.98)
employee who has completed five years or more of service gets a gratuity on death or resignation or retirement at 15 days Closing fair value of the plan asset 25.84 22.13
salary (last drawn salary) for each completed year of service. The holding Company gratuity plan is funded with an Insurance VI Maturity profile of defined benefit obligation
company, whereas that of subsidiary is unfunded. Within the next 12 months (next annual reporting period) 12.00 12.37
Between 1 to 5 years 34.04 33.43
The actuarial valuation of the defined benefit obligation was carried out at the balance sheet date. The present value of the Between 6 to 10 years 24.12 23.95
defined benefit obligations and the related current service cost and past service cost were measured using the Projected Over 10 years - -
Unit Credit Method. VII Quantitative sensitivity analysis for significant assumptions is as below:
Increase/(decrease) on present value of defined benefit obligation at the
These plans typically expose the Group to actuarial risks such as: inherent interest rate risk, longevity risk and salary risk.
end of the year
(i) +100 basis points increase in discount rate (0.11) 1.72
Interest Rate Risk The defined benefit obligation calculated uses a discount rate based in government bonds. If bond yield fall,
(i) -100 basis points decrease in discount rate 0.12 (1.98)
the defined benefit obligation will tend to increase.
(iii) +100 basis points increase in rate of salary increase 0.12 2.08
Longevity Risk `The present value of the defined benefit plan liability is calculated by reference to the best estimate of the
(iv) -100 basis points decrease in rate of salary increase (0.11) (1.81)
mortality of plan participants both during and after their employment. An increase in the life expectancy of
the plan participants will increase the plan's liability.
Salary Risk Higher than expected increases in salary will increase the defined benefit obligation.

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

2 Sensitivity analysis method Note 41: Contingent liabilities and Commitments ` million

Sensitivity analysisis performed by varying a single parameter while keeping all the other parameters unchanged. Sr no Particulars As at As at
Sensitivity analysis fails to focus on the interrelationship between underlying parameters. Hence, the results may 31st March, 2021 31st March, 2020
vary if two or more variables are changed simultaneously. The method used does not indicate anything about the (A) Contingent liabilities
likelihood of change in any parameter and the extent of the change if any. a) Sales tax matter under litigation in respect of Company for FY 2009-10, F.Y. 2010- 63.40 58.70
VIII Actuarial Assumptions: (Parag) 2020-21 2019-20 11 and FY 2016-17 for pending forms and lower allowance on account of Central
1 Discount rate 6.37%-6.54% 6.40%-6.51% Quantum Benefit, against which appeal has been filed.

2 Expected return on assets 6.37% 6.40% b) Claim against the Company not acknowledge as debt in relation to claim made 70.68 70.68
by France International Trade, Rennes, vide Special Civil Suit No. 692/2012 dated
3 Expected rate of salary increase 6.00% - 7.00% p.a 6.00% - 7.00% p.a
7th March, 2012 in the Court of Honourable Civil Judge, Senior Division, Pune for
4 Withdrawal rate 12.00% - 14.00% 12.00% - 14.00%
damaged goods supplied by the Company. The amount includes interest of Rs
5 Mortality Indian Assured Lives Indian Assured Lives 20.37 Million
Mortality (2012-14) Mortality (2012-14) c) Goods and Service Tax matter under litigation in respect of Company for FY 7.85 7.85
Ultimate Ultimate 2017-18
d) Goods and Service Tax matter under litigation in respect of Company for FY 59.70 -
(a) The rate used to discount post-employment benefit obligations is determined by reference to market yields at the end
2017-18
of the reporting period on government bonds.
e) Sales Tax matter under litigation in respect of Company for FY 2017-18 for 6.50 1.12
(b) The estimates of future salary increases considered in the actuarial valuation take account of inflation, seniority, pending forms
promotion and other relevant factors, such as supply and demand in the employment market. f) Income tax matter under litigation for the AY 2013-14 to AY 2019-20 38.82 11.83
g) Corporate Guarantee given by the Company for Loan taken by suppliers from Bank 200.00 200.00
(c) The gratuity fund of holding Company is managed by life insurance company, details of fund invested by insurer are not
(B) Commitments
available with company.
Estimated amount of contracts remaining to be executed on capital account 80.43 378.5
(d) The Group expects to make a contribution of ` 11.75 Million to the defined benefit plans (gratuity - funded) during the and not provided for (net of advances)
next financial year.
Notes:
(e) The average duration of the defined benefit plan obligation at the end of the reporting period is 6.48 years.
i. The Company is involved in other disputes, lawsuits, claims, inquiries and proceedings including commercial matters that
C Annual Leave and Sick Leave (compensated absence) arise from time to time in the ordinary course of business. The Company believes that there are no such pending matters that
The liability towards compensated absences (annual leave and sick leave) for the year ended 31st March, 2021 based on are expected to have any material adverse effect on its financial statements in any given accounting period.
actuarial valuation carried out by using Projected Unit Credit method resulted in decreased in liability by ` 0.06 million.
(Previous Year- increased by ` 0.06 million) ii. The amounts shown above represent the best possible estimates of pending litigations/disputes arrived at on the basis of
available information. The above do not include potential risks/demands, if any, for ongoing issues where no claims have
Financial Assumptions 2020-21 2019-20 been made against the Group.
Discount Rate 6.37% - 6.54% 6.40% - 6.51%
iii. Pending resolution of the respective proceedings, it is not practicable for the Group to estimate the timings of cash outflows,
Basic salary increases allowing for Price inflation 6.00% - 7.00% 6.00% - 7.00%
if any, in respect of the above as it is determinable only on receipt of judgements/ decisions pending with various forums/
authorities.
Demographic Assumptions 2020-21 2019-20
Mortality IALM (2012-14) IALM (2012-14) Note 42: Disclosure pursuant to Indian Accounting Standard (Ind AS) 24, Related Party Disclosures
Ultimate Ultimate
Details of related parties:
Employee Turnover 12% - 14% 12% - 14%
Leave Availment Ratio 15% for first two 15% for first two Description of relationship Name of the related parties
years years Key Management Personnel (KMP) of Holding Company Mr. Devendra Shah – Chairman
Mr. Pritam Shah – Director
Mr. Venkat Shankar - CEO (till 29th June, 2020)
Mr. Shashikant Dalmia - CFO (w.e.f. 2nd Aug, 2019)
Mr. Vimal Agarwal - CFO (till 19th July, 2019)
Mr. Nitin R. Dhavalikar - Director
Ms. Radhika Dudhat - Director
Mr. Narendra Ambwani - Director
Mr. Ramesh Chandak - Director
Mr. B. M. Vyas - Director
Mr. Sunil Goyal - Director (till 25th May, 2020)

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Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

Description of relationship Name of the related parties Details of balances outstanding as at 31st March, 2021 for related party transactions ` million

Relative of Key Management Personnel Late Mr. Parag Shah Particulars As at As at

Mr. Prakash Shah 31st March 2021 31st March 2020

Miss. Akshali Shah Amount Payable to

Mr. Poojan Shah Devendra Shah 4.27 1.64
Mrs. Priti Shah Pritam Shah 3.94 1.26
Mrs. Netra Shah
Venkat Shankar - 3.56
Mr. Stavan Shah
Shashikant Dalmia 0.66 1.03

Entity in which KMP can exercise significant influence Bharat Trading Company Rachana Sanganeria 0.20 0.20
SBM Advisors LLP B.M. Vyas 1.54 0.75
Akshali Shah 0.29 0.29
Details of related party transactions For the year ended on 31st March, 2021: ` million
Poojan Shah 0.05 0.05
Particulars 2020-21 2019-20
Netra Shah 0.99 1.14
Remuneration to Key Management Personnel and their relatives *
Devendra Shah 24.00 24.00 Priti Shah 0.71 0.49
Pritam Shah 24.00 24.00 Stavan Shah 0.05 -
Venkat Shankar 4.87 14.92 Parag Shah 0.26 0.26
Vimal Agarwal - 5.69 Personal guarantee issued by
Shashikant Dalmia 7.09 4.60
Devendra Shah, Pritam Shah, Parag Shah, Prakash Shah, Netra Shah and Priti Shah 6,620.86 5,779.70
Rachana Sanganeria 2.37 2.05
Akshali Shah 3.48 3.48 Note 43:- Disclosure pursuant to Indian Accounting Standard (Ind AS) 116, Leases
Poojan Shah 0.56 0.56 A.
Right-of-Use assets
Stavan Shah 0.09 -
Netra Shah 0.56 0.56 The Group has entered into commercial leases for taking office spaces on lease. These leases have an average term of three
Rent Payment
to five years with renewal option and escalation clauses included in the agreements. There are no restrictions placed upon
the Company by entering into these leases. The Company has not given any sub lease during the year. Some of the lease
Devendra Shah 3.24 3.37
arrangements also include a non-cancellable period.
Pritam Shah 0.30 0.43
Priti Shah 0.24 0.37 ` million
Netra Shah 0.24 0.37
Consultancy fee including out of pocket expenses Carrying Value 2020-21 2019-20
B.M. Vyas 8.40 8.40 Opening Balance 156.41 -
SBM Advisors LLP - 0.91 Additions - 156.41
Reimbursment of expenses KMP
Disposal / derecognized during the year - -
Devendra Shah 0.23 -
Closing Balance 156.41 156.41
Director sitting fees
Nitin R. Dhavalikar 1.10 1.10 ` million
Radhika Dudhat 0.70 0.70
Narendra Ambwani 0.90 0.80 Accumulated depreciation 2020-21 2019-20
Ramesh Chandak 1.00 1.10 Opening Balance 19.24 -
Loan repaid to Additions 32.23 19.24
Devendra Shah - 45.00
Disposal / derecognized during the year - -
The remuneration to the key managerial personnel and their relatives (if any) comprises of only short term benefits and does not Closing Balance 51.47 19.24
include the provisions made for gratuity and leave benefits, as they are determined on an actuarial basis for the Company as a
whole. Further, the remuneration to key managerial personnel does not include employee stock compensation expense.

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Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

B. Lease Liabilities ` million Note 45: Disclosure pursuant to Indian Accounting Standard (Ind AS) 108, Operating Segments,
The Managing Director of the holding Company acts as the chief operating decision maker (CODM) of the Group Companies
Particulars 2020-21 2019-20 in accordance with Indian Accounting Standard (Ind AS) 108, Operating Segments, for purpose of assessing the financial
Opening Balance 140.28 - performance and position of the group, and make strategic decisions. The group’s business activities are mainly related to
Addition - 156.41 processing of milk and manufacturing of milk related products, which are primarily assessed as a single reportable operating
Accredition of interest 13.97 5.38 segment in accordance with Ind AS 108 by the CODM.
Payments 42.11 21.51
Total 112.14 140.28 The information based on geographical areas in relation to revenue and non-current assets are as below:

` million Revenue from operations ` million

Particulars 2020-21 2019-20
Lease liabilities 2020-21 2019-20
Within India 18,090.00 23,996.04
Lease rentals due
Outside India 327.63 383.20
Current 26.22 28.14
Total 18,417.63 24,379.24
Non - Current 85.92 112.14
Total 112.14 140.28 Non-current operating assets

C. Disclosure for minimum lease rentals payable under non-cancellable lease agreements are as below: (Lease liabilities) All non –current assets other than financial instruments, deferred tax assets of the group are located in India

` million The group does not have revenues from transactions with a single external customer amount to 10 per cent or more of the total
Lease liabilities 2020-21 2019-20 revenues.
Lease rentals due Note 46 : Biological Assets
Not later than one year 37.28 42.11
A Nature of Activities
Later than one year and not later than five years 99.54 136.82
Total 136.82 178.93 The subsidiary Company’s biological assets comprises of livestock (dairy cows).

D. Amounts to be recognised in Statement of Profit and Loss for the year ended 31st March, 2021 Livestock is measured at fair value less costs to sell, with any resulting gain or loss recognized in the statement of profit and
loss. The subsidiary Company’s livestock comprises of both mature and immature livestock.
` million
Immature livestock comprises dairy cows that are intended to be reared to maturity. These cows are held to produce milk or
Lease liabilities 2020-21 2019-20 offspring, but have not yet produced their first calf and begun milk production.
Depreciation expense of Right-of-Use assets 32.23 19.24
Mature livestock includes dairy cows that have produced their first calf and begun milk production.
Interest expense on lease liabilities 13.97 5.38
Total 46.20 24.62 Other livestock comprises of cows that are going through the dry phase of their life cycle.

Note 44: Disclosure pursuant to Indian Accounting Standard (Ind AS) 33, Earnings Per Share ` million
Particulars 2020-21 2019-20 Headcount
Profit/(Loss) attributable to Equity shareholders (` in Million)(A) 207.05 936.89 Particulars As at As at
31st March 2021 31st March 2020
Weighted average number of Equity shares (Nos) for basic EPS (B) 8,39,38,567 8,39,38,567
(Heads) (Heads)
Effect of Dilution :
Immature cows 1015 896
Weighted average number of Treasury shares held through ESOP Trust 1,76,015 1,76,015 Mature cows 1171 1132
Weighted average number of Equity shares (Nos) adjusted for the effect of dilution ( C ) 8,41,14,582 8,41,14,582 Other cows 208 229
Basic EPS (Amount in `) (A/B) (`) 2.47 11.16 Total 2394 2257
Total milk production(In Ltrs) 79,25,877 78,19,877
Diluted EPS*(Amount in `) (A/C) (`) 2.46 11.14
The subsidiary Company is exposed to fair value risks arising from changes in price of raw milk. The Subsidiary Company
Basic: Basic earnings per share is calculated by dividing the profit attributable to equity shareholders of the Company by the
does not anticipate that the price of the raw milk will further decline significantly in the foreseeable future and the Company
weighted average number of equity shares outstanding during the year, excluding equity shares held as treasury shares.
is of the view that there is no available derivative or other contracts which the Company can enter into to manage the risk of
Diluted: Diluted earnings per share is calculated by adjusting the weighted average number of equity shares outstanding during a decline in the price of the raw milk.
the year for assumed conversion of all dilutive potential equity shares. Employee share options are dilutive potential equity shares
for the Company.

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 Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

B FAIR VALUE MEASUREMENTS Note 48: Disclosure pursuant to Indian Accounting Standard (Ind AS) 102, Share-Based Payments
Fair Value Hierchy ` million The Board of Directors constituted the equity settled Employee Stock Option Scheme (“ESOS 2015”) vide its resolutions dated 27
February, 2015 and 21 April, 2015 for issue of 696,339 stock options to the key employees of the holding Company, which has been
Particulars As at 31st March 2021 As at 31st March 2020 Fair Value Hierchy further approved in the Holding Company’s Extra ordinary General meeting dated 3 April, 2015 and 16 May, 2015.
Livestock (Cow) 402.60 359.72 Level 3
Pursuant to the above scheme, the Board of Directors vide its circular resolution dated 3 September, 2015, approved grant of
Valuation Technique used in the Fair Value Measurement 227,000 stock options to its employees on 4 September, 2015.

The Company has in its Board Meeting dated 01 November, 2018 approved the grant of 166,015 options to the eligible employees
Particulars Valuation Significant Inter-relationship between significant unobservable inputs and
of the Company at a fair market value of ` 258.90 (Two Hundred Fifty Eight Rupees and Ninety Paise) per option (based on the
Technique unobersvable fair value measurements
closing market price of ` 258.90 of the Company’s shares on NSE as on 31 October, 2018) under the Parag Milk Foods Limited
input
– Employee Stock Option Scheme, 2018 - “ESOS 2018” (erstwhile ESOS2015 under the ESOS Scheme 2015, renamed as ESOS
Livestock The fair values • Estimated • Estimated feeding cost/ milking cow increase by 1% would Scheme 2018, besides renaming of the scheme to ESOS 2018, the other terms and conditions will remain the same as stated in
(Milking of dairy cows is feeding cost/ reduce the fair valuation by ` 24.13 Mn and ` 23.93 Mn as of 31st ESOS 2015.) The Board of Directors approved fresh grant of ESOP options 1,66,015 at a fair market value of ` 258.90 per option
cows) determined by milking cow March, 2021 and 2020. under Parag Milk Foods Limited - Employee Stock Option Scheme - 2018 “ESOS 2018” (erstwhile ESOS-2015 under the SSOS
using the multi- • Estimated milk • Estimated milk yield/ milking cow increase by 1% would increase scheme 201, renamed as ESOS scheme 2018, besides remaining of the scheme to ESOS 2018 the oher terms and conditions will
period excess yield/ milking the fair valuation by ` 15.16 Mn and ` 13.97 Mn as of 31st March, remain the same as stated in ESOS 2015.
earnings method, cow 2021 and 2020.
which is based on • Estimated • Estimated weighted average selling price of milk / Litre increase According to ESOP 2018, the employee selected will be entitled to stock options, subject to satisfaction of the prescribed vesting
the discounted weighted by ` 1/ litre would increase the fair valuation by ` 21.96 Mn and ` conditions in the scheme. The contractual life (comprising the vesting period and the exercise period) of options granted is 3
future cash flows average selling 21.09 Mn as of 31st March, 2021 and 2020. years. The other relevant terms of the grant are as below. The fair valuation of the option have been computed as per the black
to be generated by price of milk / • Discount rate increase by 1 % would reduce the fair valuation by ` scholes pricing model.
such dairy cows. Litre 18.30 Mn and ` 12.73 Mn as of 31st March, 2021 and 2020.
• Discount rate Vesting Period 1 years
Exercise Period 2 Years
The Group is exposed to a number of risks relating to its agricultural activities:
Expected Life 2 Years
• Regulatory and environmental
Exercise Price ` 258.90
The Group is subject to various local laws and regulations, and it has established policies and procedures aimed at
Fair value using Black Scholes model on grant date ` 71.14
ensuring compliance with the same.
Date of grant 01-Nov-18
• Supply and demand
The details of activity under ESOS 2018 are summarized below:
The Group is exposed to the risk arising from fluctuations in milk prices. The Company does not anticipate that the price
of the raw milk will decline significantly in the foreseeable future. Further, there are no available derivatives or other
Particulars As at 31st March 2021 As at 31st March 2020
contracts available in the market for managing such risk.
No. of options WAEP (`) No. of options WAEP (`)
• Climate and other risks
Outstanding at the beginning of the year 1,15,765 258.90 1,66,015 258.90
The subsidiary Company’s livestock is exposed to risk of adverse climatic conditions and diseases etc. The Company Granted during the year - - - -
has extensive processes in place to address the risk by having an in-house veterinary doctor and dispensary, regular
Forfeited / Lapsed during the year 13,726 258.90 50,250 258.90
health checkups of livestock cattle. The Company also has taken an insurance cover for its livestock.
Exercised during the year - - - -
Note 47 : Disclosure on CSR Expense ` million Outstanding at the end of the year: 1,02,039 258.90 1,15,765 258.90
Particulars 2020-21 2019-20 of which Options vested and exercisable at the end of the year - - - -
a) Gross amount required to be spent by the Group during the period. 29.82 25.66
b) Amount spent during the year on:
(i) Construction/acquisition of any asset
(ii) On purposes other than (i) above
In Cash 40.56 10.78
Yet To be Paid in Cash - 14.88

234 235
Parag Milk Foods Limited Wholesome living Corporate Overvies Statutory Reports Financial Statements

Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements

for the period ended 31st March, 2021 for the period ended 31st March, 2021

` million Note 50: The List of subsidiary included in Consolidated Financial Statements is as under:
Particulars As as As as Name of the subsidiary company Principal place Proportion of direct ownership Proportion of direct ownership as on
31st March 2021 31st March 2020 of business as on 31st March, 2021 31st March, 2020
Dividend yield (%) Bhagyalaxmi Dairy Farm Private Limited India 100% 100%
Expected volatility 34.95% 34.95%
Risk-free interest rate 7.40% 7.40% Note 51:
Weighted average share price 258.90 258.90 The Code on Social Security, 2020 (‘Code’) received the Indian Parliament approval and Presidential assent in September 2020.
Exercise price (`) 258.90 258.90 The Code once made effective would impact the employee benefits during employment as well as post employment benefits. The
Expected life of options granted in years 2 2 implementation of the Code has been deferred by the Central Government on 30th March, 2021 and the date from which the code
Life of option remaining in months 0 7 will be effective is yet to be notified. The impact assessment of the Code will be done by the Company once the same is made is
effective.
The expected option life is assumed to be approximately half way between the option vesting period and contractual term of the
option. Since the vesting period and contractual term is different, the expected life of the option will be different. The expected Note 52 :
option life is calculated as Year to Vesting + (Contractual Option Term) /2. Volatility was calculated using standard deviation of
Based on its initial assessment, the Management does not expect any significant impact on the business of the Group due to the
daily change in stock price. The historical period taken into account match the expected life of the option.
COVID-19 pandemic. The Group has evaluated the possible effects of COVID-19 on the carrying amounts of property, plant and
Expenses Arising from share based payment transactions equipment, inventory and trade receivables basis the internal and external sources of information and determined, exercising
reasonable estimates and judgements, that the carrying amounts of these assets are recoverable. Having regard to the above,
Total expenses arising from share-based payment transactions recognised in profit or loss as part of employee benefit expense and the Group’s operating efficiency and gradually improving liquidity position, there is no material uncertainty in meeting the
were as follows: financial obligations over the foreseeable future.

` million Note 53:

Previous year figures have been regrouped/reclassified wherever necessary.
Particulars 2020-21 2019-20
Employee option Plans (0.98) 3.38 Signatures to Notes 1 to 53
Note 49 : Statement of net assets and Profit or Loss attributable to owners and non controlling Interest

Name of Entity Net assets i.e. total Share in profit or loss Share in other Share in total
assets comprehensive income/ comprehensive income SHARP & TANNAN For and on behalf of the Board of Directors
minus total liabilities (loss) Chartered Accountants
Firm’s Registration No. 109982W
As % of Amount As % of Amount As % of Amount As % of Amount by the hand of
consolidated (` in consolidated (` in consolidated (` in consolidated (` in Edwin P. Augustine Devendra Shah Pritam Shah
net assets million) net assets million) net assets million) net assets million) Partner Chairman Managing Director
Holding Membership No. 043385 DIN: 01127319 DIN: 01127247

Parag Milk Foods Ltd 99.10% 9,198.11 84.29% 174.53 98.38% 5.71 84.68% 180.24 Shashikant Dalmia Rachana Sanganeria
Chief Financial Officer Company Secretary & Compliance Officer
Sub-total 99.10% 9,198.11 84.29% 174.53 98.38% 5.71 84.68% 180.24
Membership No. ACS10280
Subsidiary (Indian) Place: Mumbai Place: Manchar
Bhagyalaxmi Dairy Farm 0.90% 83.31 15.71% 32.52 1.62% 0.09 15.32% 32.61 Date: 12th June, 2021 Date: 12th June, 2021
Private Limited
Sub-total 0.90% 83.31 15.71% 32.52 1.62% 0.09 15.32% 32.61
Total 100.00% 9,281.42 100.00% 207.05 100.00% 5.80 100.00% 212.85
Consolidated Net Assets/ 9,281.42 207.05 5.80 212.85
Loss after tax

236 237
WHOLESOME
LIVING