P&G 2018-2019_Annual Report.txt

    


CONTENT
ChairmanÕs Letter ...................................................................................................	03
Managing DirectorÕs Letter.....................................................................................	04
Report of the Directors	05-37
Management Discussion & Analysis	38-40
Corporate Governance	41-59
AuditorsÕ Report	60-67
Balance Sheet .......................................................................................................	68
Statement of Profit & Loss .......................................................................................	69
Statement of Cash Flow	70-71
Statement of Changes in Equity............................................................................	72
Notes forming part of the Financial Statements	73-114
Ten Year Financial Highlights	115
Company Overview
BoardÕs Report
Management Discussion and Analysis
Corporate Governance
Financial Statements
Corporate Information
Board of Directors & Key Managerial Personnel
Mr. Rajendra A. Shah	Chairman & Independent Director
Mr. Madhusudan Gopalan	Managing Director
Mr. Bansidhar S. Mehta	Independent Director
Mr. Anil Kumar Gupta	Independent Director
Ms. Meena Ganesh	Independent Director
Mr. Pramod Agarwal	Non-Executive Director
Mr. Karthik Natarajan	Non-Executive Director
Ms. Sonali Dhawan	Non-Executive Director
Mr. Ghanashyam Hegde	Non-Executive Director
Mr. Gagan Sawhney	Non-Executive Director
Mr. Prashant Bhatnagar	Chief Financial Officer
Ms. Flavia Machado	Company Secretary
Registered Office:
Procter & Gamble Hygiene and Health Care Limited
(CIN: L24239MH1964PLC012971)
P&G Plaza, Cardinal Gracias Road, Chakala, Andheri (East), Mumbai Ð 400 099
Tel. No.: (022) 2826 6000
Investor helpline Nos.: 86575 12368 / 86575 00524 Email Id: investorpghh.im@pg.com

Auditors: Statutory Auditor:
Kalyaniwalla & Mistry LLP
Chartered Accountants
Cost Auditor:
Ashwin Solanki & Associates
Cost Accountants
Secretarial Auditor:
Dholakia & Associates LLP
Company Secretaries
Registrar & Share Transfer Agents: Link Intime India Private Limited C-101, 247 Park,
L.B.S. Marg, Vikhroli (West),
Mumbai Ð 400 083
Tel. No.: (022) 4918 6279
Fax: (022) 4918 6060
E-mail ID: rnt.helpdesk@linkintime.co.in

Listed on Stock Exchanges:
National Stock Exchange of India Limited BSE Limited
Mr. R. A. Shah
Chairman & Independent Director
   Mr. Shah is a leading solicitor and a senior partner of Crawford Bayley & Co., a firm of solicitors and advocates. He specializes in broad
spectrum of corporate laws. He has been a director on the boards of several prominent companies in India.
Mr. Madhusudan Gopalan
Managing Director

    Mr. Madhusudan Gopalan is an alumnus of IIM Calcutta who joined P&G in 1999. He has more than 19 years of experience working across business units and diverse geographies like India, US and ASEAN
           countries. Prior to this role, he, was leading the P&G business in Indonesia where he led strong sales growth, share turn around, strong value creation and cash productivity.

Mr.  B. S. Mehta
Independent Director
Mr. Mehta is a graduate in commerce and a Fellow Member of The Institute of Chartered Accountants of India. He is a Chartered Accountant in practice dealing with taxation, accountancy and valuation of mergers and acquisitions. He has been a Director on the Boards of several prominent companies in India.
Mr.  A. K. Gupta
Independent Director

Mr. Gupta is an engineer from IIT New  Delhi.  He also holds a PG Diploma in Industrial Management
from Jamnalal Bajaj Institute of Management Studies, Mumbai. He has  a vast experience of over 40 years in India and abroad in the field of Manufacturing, Projects and Supply Chain Management.

Ms. Meena Ganesh
Independent Director

  Ms. Meena Ganesh is one of IndiaÕs most successful entrepreneurs with nearly 3 decades of experience in industries including healthcare,
       consulting, technology, outsourcing, education and e-commerce. Ms. Meena Ganesh is the Managing Director
& CEO of Portea Medical, which she co-founded in July 2013. Ms. Meena Ganesh is a PGDM holder from IIM Calcutta and has a graduate degree in Physics from the Madras University. She has been named by Fortune India as one of the 50 'Most Powerful Women in BusinessÕ for five consecutive years (2015 - 2019).

Mr.  Pramod Agarwal
Non-executive Director
Mr. Agarwal, an MBA from Indian Institute of Management, Ahmedabad. After  over 28 years of experience with P&G, he retired in 2016. He worked in seven geographies - India, Thailand, Japan, Philippines, USA, Singapore and Switzerland. Mr. Agarwal has led several major changes which have had a lasting impact on the business and
organization.

Mr.  Karthik Natarajan
Non-Executive Director
Mr. Natarajan is  a  Chartered  Accountant  and  has completed his Bachelor of Commerce from
R. A. Podar College, Mumbai. Mr. Natarajan has been
with P&G for over 19 years and is currently the Vice President, Finance & Accounting, Asia Pacific, Middle East & Africa. He has over his experience at P&G worked across multiple locations including India, US, China, Philippines and Singapore. He has held global responsibilities and has led strategy development, business and financial planning and operational execution with excellence for several important P&G businesses.

Mr. Ghanashyam Hegde
Non-executive Director
Mr.  Hegde  is  a  legal  professional  with  over  18 years of experience across pharma, media & entertainment, financial services and chemical industries.
He is an alumnus of Bangalore University and National Law School of India University and holds a degree in law and Post Graduate Diploma in Intellectual Property Rights. He is also a qualified Company Secretary. He joined P&G in September 2018 as General Counsel for Indian Sub- continent.



Ms. Sonali Dhawan
Non-executive Director
 Ms. Dhawan is a graduate from Lady Shriram College, with a B.Com (Hons) in Business Studies. She completed her MBA in marketing from the
Indian Institute of Management, Ahmedabad. Ms. Dhawan has been with P&G for over 20 years and is currently Vice President, Marketing, Feminine Hygiene, Asia, Middle East & Africa. She has worked across multiple regions including ASEAN, India, Australia & Middle East.
Mr.  Gagan Sawhney
Non-executive Director

Mr. Gagan Sawhney is an alumnus of IIM, Ahmedabad who joined P&G in Finance in 2001. He has more than 19 years of experience across multiple geographies : India, ASEAN and Greater China. Prior to this, he was Finance Director of
Internal Audit for P&G Global operations, where he provided assurance and consulting support across regions.



Mr. R. A. Shah, Chairman
Dear Shareholders,
It gives me great pleasure to share with you the performance of your Company for the Financial Year 2018-19. Your Company has delivered double-digit growth for the Financial Year. Our continued focus on strengthening brand fundamentals and improving productivity led us to achieving sustainable growth. In the last few months, while the economy is growing at a slower pace than expected, projections of recovery behind newly launched government initiatives are a positive sign for the industry.
Your Company has built citizenship into its way of doing business and is committed to be a force for good and a force for growth. Our aspiration is to have a positive impact across each area of  our Citizenship work Ð Community Impact, Gender Equality and Environment Sustainability.
In the area of community impact, through our flagship CSR program P&G Shiksha, the P&G group in India has supported 2100 schools that will impact the lives of 17 lakh children. P&G ShikshaÕs efforts are focused in three main areas Ð improving educational infrastructure, empowering marginalized girls through education and improving learning outcomes. We also provide comforts of home to those affected by a disaster. Last year, P&G supported nearly 50,000 families affected by the floods in Kerala with health and hygiene kits. Our employees also contributed monetarily to set up health camps across the state. We also distributed P&Gs Purifier of Water providing clean water to the affected families. Earlier this year, we also donated health and hygiene kits to more than 10,000 families affected by cyclone FANI in Orissa.
Lastly, I would also like to express my gratitude to all our consumers, customers, employees, business partners and YOU, our valued Shareholders for your support and participation in the growth of your Company. We are keenly focused on creating value for our stakeholders. We will continue to innovate and bring superior products to consumers and sustainably grow the business.

R. A. Shah Chairman

Dear Shareholders,
It gives me great pleasure to share with you the overall performance of your Company in 2018-19. In a competitive market, your Company delivered strong double-digit growth. Our focus on raising the bar on superiority, improving productivity, and strengthening the organization culture has enabled us to deliver strong results consistently throughout the Financial Year.
Your Company delivered Sales of ` 2,947 crores, up 20% vs. year ago and recorded a Profit After Tax (PAT) of ` 419 crores up 12% vs. a year ago. This is a result of our strong brand fundamentals, strength of our product portfolio and continued focus to raise the bar on superiority across products, packaging, value, communication and retail execution.
In the Feminine Care business, Whisper continues to be the market leader behind continued focus on meeting the consumersÕ needs across both top and mid-tiers of the segment. During the Financial Year, we launched Whisper Choice Aloe Vera to meet the Indian consumersÕ preference for naturals at an affordable price point. We also launched our new campaign ÔMeri Life Mere RulesÕ that encouraged girls to live life as per their own rules and achieve their dreams.


Mr. Madhusudan Gopalan
Managing Director
Whisper continues to bring transformational positive change in the community. Through our Whisper School program, we actively supported 40,000 schools educating about 50 lakhs adolescent girls on the importance of menstrual hygiene. I am proud to share that since 1995, we have educated more than 2.5 crore girls across the country on menstrual hygiene. We also worked with the Goa Government to set up an educational module on Menstrual Hygiene Management as part of the value-added Education in Government Schools.
During the Financial Year, Vicks launched the ÔOne in a million #TouchOfCareÕ campaign building on its belief that care can transform lives. I am happy to share that the campaign bagged four awards at the most prestigious Cannes Lions International Festival of Creativity; Silver Lion in the Film for Single-market Campaign category and a total of three Bronze Lions, one in Creative Strategy, Film Craft, and Film Healthcare category each.
Overall, we will continue to focus on category growth while continuing to maintain our leadership across categories.
As a responsible corporate citizen, we want to be a force for good and a force for growth. We continue to build on each of area of our citizenship to bring about a positive change in the communities we live and work. Through our flagship CSR program, P&G Shiksha, the P&G group in India has supported over 2100 schools impacting more than 17 lakh children. Over the years P&G Shiksha has evolved into a 360-degree educational intervention addressing three critical barriers to achieving universal education Ð access to education infrastructure, gender inequality in access to education and gap in learning.
The FMCG sector continues to be an important contributor to the economy. We will continue to focus on balanced growth behind brand fundamentals, strength of the product portfolio and improved execution.

Madhusudan Gopalan Managing Director

REPORT OF THE DIRECTORS

Your Directors  have  the  pleasure  of  presenting  the  55th Annual Report and the Audited Financial Statements of your Company for the Financial Year ended June 30, 2019.
FINANCIAL RESULTS
(Figures in ` crores)


2018-19
2017-18
Revenue from operations
2,947
2,455
Profit before tax (PBT)
607
582
Profit after tax (PAT)
419
375
FINANCIAL YEAR
Your Company follows its Financial Year as July 1st to June 30th.
DIVIDEND
The Directors are pleased to recommend a final dividend of
` 48 for each Equity Share for the Financial Year ended June 30, 2019. During the Financial Year, the Board of Directors declared an interim dividend of ` 40 per Equity Share. The payment of the interim dividend to the Shareholders was completed on March 7, 2019.
BUSINESS PERFORMANCE
Your Company delivered another year of steady balanced performance in tough external environment.
Your Company delivered Sales of ` 2,947 crores, up 20% versus year ago (comparable* sales up 14%). The PAT was
` 419 crores, up 12% versus year ago. We continue to focus on growth behind brand fundamentals, strength of product portfolio and improved in-store execution.
Hygiene Business
In the Feminine Care business, Whisper continues to hold its position as the market leader. During the Financial Year, the brand continued to make strong progress in growing more users on sanitary napkins, particularly on top-tier. Our best in class menstrual hygiene school program expanded to reach a critical milestone of 50% urban girls across the country. We also continued to drive depth and breadth of our portfolio via sharply defined go-to-market plans taking category to more stores.


We strengthened our play in the emerging ÒComfort & SoftÓ segment with the launch of Whisper Choice Aloe Vera (first of its kind entry into mid-tier natural segment) at the lowest entry point giving the right proposition and the right product at the right price to convert the cloth user.
* Comparable Sales is reported sales adjusted for impact of GST exemption on sanitary napkins versus previous year.
Note: Certain Statements in this Annual Report may be seen as forward looking statements. The actual results may differ materially for those expressed or implied in the statement depending on circumstances.

We also re-staged our entire top-tier lineup with a packaging upgrade and a new campaign ÒMeri Life Mere RulesÓ that drove significant social media conversation on breaking societal limitations on girls, so they live life unconstrained and achieve their dreams.

Health Care Business
Your CompanyÕs Health Care business continued to grow strong double digit behind the strength of our equities and our portfolio, which includes Vicks VapoRub, Vicks Cough Drops, Vicks Action 500 Advanced, Vicks Inhaler and Vicks BabyRub. The growth was driven by a combination of plans to win with consumers, winning versus competition and winning in whitespaces with the launch of BabyRub.
Vicks Rubs grew penetration behind our Category Development Index program for the third year in a row continuing to grow volume share in the Financial Year 2018-19. Vicks Cough Drops offtake grew strong with share gain in the cough lozenges category, in a year of multiple competitive launches and increased investments on media and trade from existing competition. We have also strengthened & premiumized our throat lozenges portfolio with the launch of ÔVicks 3 in 1Õ in June 2019.
Apart from the strong business results, the brand received external recognition with the Equity building campaign Ð Vicks #TouchOfCare One in a Million Ð becoming the most awarded Indian campaign at the prestigious Cannes Lion 2019. The campaign won 4 metals



(1 Silver Lion Ð Film for Single-market Campaign category & 3 Bronze Lions Ð Creative Strategy, Film Craft, and Film Healthcare category).
Overall, your Company continued to focus on driving consumer meaningful innovations backed by distribution expansion and strong advertising thereby delivering consistent growth.
Old Spice continued to have a challenging Financial Year 2018-19. There is a conscious business choice to hold back investments on Old Spice until there is a winning proposition in a category that is highly dynamic and competitive.

FINANCIAL RATIOS


FY 2018-19
FY 2017-18
% Change
Debtors turnover
17.9
17.5
3%
Inventory turnover
18.0
16.3
10%
Interest coverage ratio
111.8
110.4
1%
Current ratio
1.7
1.5
13%
Debt equity ratio
0
0
N.A.
Operating profit margin
21%
24%
-13%
Net profit margin
14%
15%
-8%
Return on Networth
49%
56%
-7%

BUSINESS RESPONSIBILITY REPORT
A separate report on Business Responsibility has been appended as Annexure I to this Report.
Company Overview
BoardÕs Report
Management Discussion and Analysis
Corporate Governance
Financial Statements




The only way to build a sustainable business is to improve lives















































Annual Report 2018-2019

CORPORATE SOCIAL RESPONSIBILITY (ÔCSRÕ)

Since its foundation, giving back to the communities has been an integral part of your CompanyÕs purpose and values. We have built sustainability into the way we
operate, and we know that this will enable us to have a bigger impact on the world around us. This has inspired our CSR strategy supported by two pillars Ð P&G Shiksha and Timely Disaster Relief. P&G Shiksha provides access to holistic education for underprivilege children through 360-degree educational interventions and your CompanyÕs disaster relief aims to provide comforts to those affected by natural disasters. Your Company donated health and hygiene kits to more than 50,000 families impacted by Kerala floods. Our employees also contributed monetarily to set up health camps across the state. In addition to this, we also distributed P&G Purifier of Water, providing clean water to the affected families. Recently, we also donated health and hygiene kits to more than 10,000 families displaced by cyclone FANI in Odisha.
Your CompanyÕs signature corporate sustainability program P&G Shiksha has focused on three main areas Ð improving education infrastructure, empowering marginalized girls through education and improving learning outcomes. Till date, the P&G group in India has supported over 2100 schools (+300 since last year) schools across the country that will impact the lives of over 17 lakh (+300,000 since last year) children, in partnership with several NGOs/ organizations like Ñ Round Table India (RTI), Pratham, Education Initiatives, among others.
Along with our NGO partner Round Table  India (RTI)  we have focused on building and refurbishing school buildings, constructing classrooms, building playgrounds and improving health and hygiene facilities for children at schools. In line with the Sustainable Development Goals (SDGs), in partnership with NGO Save the Children, we are providing quality education to girls by enhancing the
education infrastructure and the quality of education available to them.
A key area that we have focused on is Ôimproving learning outcomes in childrenÕ. Within this, we have concentrated our efforts in bridging learning gaps through on-ground remedial learning interventions, strengthening early childhood education and implementing software-based adaptive learning solutions across government schools.
Along with our NGO partner Pratham Education Foundation we are bridging the expected and  existing  learning  gaps in children through on-ground remedial learning interventions. During the Financial Year, we reached out to more than 26,000 children across 5 states in India  and observed remarkable improvement in their learning levels. At the end of the intervention, more than 70% students were able to read as per their expected learning level compared to less than 25% at the beginning of the intervention. There was a two-fold increase in the number of students who could perform mathematical operations at the end of the intervention.
Through our early childhood education program in partnership with Pratham Education Foundation, we aim to develop motor and cognitive skills in children thereby setting them up for a fast-paced growth as they start school. At the end of the year, to assess their level of development, children were asked to perform several tasks like matching shapes, trace shapes, recognize numbers, say their name and family background. The results were overwhelming, atleast 85% children in the intervention groups had competent motor skills (ability to draw, hold a pencil, colour within a shape, join dots etc.) versus newly 40% in the comparison groups. Similarly, cognitive competence of the children in intervention groups was more than two-fold than that of comparison groups. We have also partnered with the state government in Delhi, Himachal Pradesh, Uttar Pradesh and Rajasthan to build capability of Anganwadi workers and mobilize volunteers from the community to assist with pre-school

activities. Through this program, we reached out to more than 4,600 units impacting more than 33,000 children.
P&G Shiksha also partnered with Educational Initiatives (EI) to implement Mindspark, a computer-based adaptive learning tool to remediate learning gaps in students across schools in Rajasthan, Himachal Pradesh, Madhya Pradesh, Andhra Pradesh, Uttarakhand and Chhattisgarh. The tool integrates pedagogy, teacher instruction and a learning management system to assess a studentÕs learning level and develop a customized learning path for each one of them. The tool analyses the learning levels in language and mathematics by presenting students with questions in increasing level of difficulty. On answering incorrectly, the student is provided a step-by-step explanation that helps strengthen their understanding. The program has been implemented in 100+ government schools where more than 17,000 students spend over 10,000 hours annually learning using Mindspark. Post the intervention, the learning levels among students using Mindspark improved two-fold compared to the control group. The tool also provides teachers with information on the progress and learning levels of students which is used for effective classroom management and instruction.
Your Company continued to impact the communities around its plants in a holistic manner throughout the Financial Year. At Goa, in association with Matruchhaya, a local public charitable trust, your Company is providing educational and infrastructural support to a school for the orphaned, destitute and abandoned children. In Mandideep, along with local NGO Arushi, we are supporting the overall development of the local Satlapur Government School.
The government recently launched Samagra Shiksha Abhiyan for the holistic development of school education and introduced the Draft National Educational Policy to reform the current education system. Your CompanyÕs efforts are in line with the government initiatives and it is well poised to play an active role in IndiaÕs Success Story.
Your Company has constituted a Corporate Social Responsibility Committee. The composition and terms of reference of the Corporate Social Responsibility Committee are provided in the Corporate Governance section annexed to this Report.
Annual report on CSR activities as required under the Companies (Corporate Social Responsibility Policy) Rules, 2014 has been appended as Annexure II to this Report.

ENVIRONMENTAL SUSTAINABILITY AND CONSERVATION OF ENERGY
Environmental sustainability is embedded in our Purpose, Values, Principles, and our business. We are committed to improving lives, now and for generations to come by ensuring that our products, packaging and operations are safe for employees, consumers and the environment. We ensure by focusing on technologies, processes and improvements that matter for the environment.
Within our operations, we strive to grow responsibly, continuously improve our efficiency while reducing our carbon footprint. The Goa manufacturing plant is  a  Ôzero waste to landfillÕ site which means that there is no manufacturing discharge into the environment. In the last 5 years, the Goa plant has reduced its carbon emission by 18%. During this period, the plant has also improved on both energy and water by 75%. The plant is also leveraging technology, experts, employees and renewable sources of energy to reduce our overall footprint and make our operations more sustainable.
We are committed to help reduce the flow of plastic by making changes now and bringing long-term solutions. In India, we have put in place a system to recover and recycle multi-layered plastic packaging waste. We are working with various waste management companies and the industry to collect, segregate and recycle multi-layered plastic packaging waste.

TECHNOLOGY ABSORPTION

i. Efforts made towards technology absorption:
¥ Usage of low pressure compressors at the Plants.
¥ Continued implementation of quality control / quality assurance procedures of products and processes were successfully adapted on commercial scale to utilize local raw materials and machinery; technical services for reliability, quality, cost savings and technology transfer from overseas.
ii. Benefits derived  like  product  improvement,  cost reduction, product development or import substitution:
¥ Usage of low pressure compressors resulted in
cost reduction and saved electricity consumption.
¥ The above  efforts  resulted  in  improving process efficiencies, consistent quality of our products, introduction of new products, import substitution and successful absorption of technology.
iii. Imported technology:
Your Company has the advantage of availing advanced technology and continuous upgradation thereof from The Procter & Gamble Company, USA and its subsidiaries. This is an unmatched competitive advantage that helps the Company deliver strong business results.
iv. Expenditure on Research & Development:
Your Company has not  incurred  any  expenditure on research and development during the Financial Year.
FOREIGN EXCHANGE EARNINGS & OUTGO
The details of foreign exchange earnings and outgo as required under Section 134 of the Companies Act, 2013 and Rule 8(3) of the Companies (Accounts) Rules, 2014 are mentioned below:
` in Lakhs


    For the Financial Year ended June 30,
2019
    For the Financial Year ended June 30,
2018
Foreign Exchange
earnings
2,422
2,635
Foreign Exchange outgo
75,321
55,999

RELATED PARTY TRANSACTIONS
Your Company has formulated a  policy  on  related  party transactions which is also available on CompanyÕs website at http://www.pg.com/en_IN/invest/pghh/corporate_ governance/policies.shtml. This policy deals with the review and approval of related party transactions. All related party transactions are placed before the Audit Committee for review and approval. Prior omnibus approval is obtained for related party transactions which are of repetitive nature and entered in the ordinary course of business and at armÕs length. All related party transactions are subjected to independent review by chartered accountant firm to confirm compliance with the requirements under the Companies Act, 2013 and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.
No material related party transactions were entered during the Financial Year by your Company. All related party transactions entered during the Financial Year were in ordinary course of the business and on armÕs length basis. Accordingly, the disclosure of related party transactions as required under Section 134(3)(h) of the Companies Act, 2013 in Form AOC 2 is not applicable to your Company.




LOANS AND GUARANTEES GIVEN AND INVESTMENTS MADE DURING THE FINANCIAL YEAR 2018-19

Details of loans given by your Company under Section 186 of the Companies Act, 2013 during the Financial Year 2018-19 are as follows:
Name of the Company
Relation
Amount
(` In Crores)
Purpose for which the loans are proposed to be utilized
Procter & Gamble Home Products Private Limited
Fellow Subsidiary
90.00
General business purpose
Your Company has not given any guarantees or made any investments during the Financial Year 2018-19.
PUBLIC DEPOSITS
Your Company has not accepted any Public Deposits under Chapter V of the Companies Act, 2013, during the Financial Year.
PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE
As per the requirement of The Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 and Rules made thereunder, your Company has constituted an Internal Complaints Committees (ICC). During the Financial Year, one complaint with allegation of sexual harassment was filed with the Company. The said complaint was closed during the Financial Year. No complaints were pending as on June 30, 2019.
DIRECTORSÕ RESPONSIBILITY STATEMENT
Pursuant to the requirement under Sections 134(3)(c) of the Companies Act, 2013, with respect to the DirectorsÕ Responsibilities Statement, it is hereby confirmed:
i. that in the preparation of the Annual Accounts for the Financial Year ended June 30, 2019, the applicable accounting standards had been followed along with proper explanation relating to material departures;
ii. that the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs  of the Company at the end of the Financial Year and of the profit or loss of the Company for the Financial Year under review;
iii. 
that the Directors had taken  proper  and  sufficient  care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv. that the Directors had prepared the accounts for the Financial Year ended June 30, 2019, on a Ògoing concernÓ basis;
v. that the Directors had laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and were operating effectively; and
vi. that the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

EXTRACT OF ANNUAL RETURN

The extract of annual return in Form MGT 9 as required under Section 92(3) of the Companies Act, 2013 and Rule 12 of the Companies (Management and Administration) Rules, 2014 is appended as Annexure III to this Report.

CORPORATE GOVERNANCE
A separate report on Corporate Governance along with the AuditorsÕ Certificate on its compliance is provided under the Corporate Governance section of this Report.

MANAGEMENT & PERSONNEL
The strength of business over the past few years and resilience in this particular year due to multiple economic headwinds in the country demonstrates the core strengths of our employees to stay reality based and influence the course of business. Financial Year 2018-19 was a year of overall strong growth. Our productivity continues to be the best-in-class with major progress in Leadership and Talent Development.
The statement of Disclosure of Remuneration under Section 197 of the Companies Act, 2013 and Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is appended as Annexure IV to this Report.
The information as per Rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. As per the provisions of first proviso to Section 136(1) of the Companies Act, 2013, the Report and Financial Statements are being sent to the Members of the Company excluding the  statement  of  particulars  of  employees  under   Rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Any Member interested in obtaining a copy of the said statement may write to the Company Secretary at the Registered Office of the Company.

DIRECTORS AND KEY MANAGERIAL PERSONNEL
Mr. Madhusudan Gopalan was appointed as a Director and Managing Director of the Company by the Shareholders of the Company effective July 1, 2018, subject to the approval of the Central Government. The Central Government accorded its approval for the said appointment on May 20, 2019.
Mr. Gagan Sawhney was appointed as Non-Executive Director of the Company by the Shareholders of the Company effective January 24, 2019.
Ms. Meena Ganesh was appointed as an Independent Director by the Board of Directors of the Company for a
period of five years effective March 19, 2019, subject to the approval of the Shareholders of the Company at the ensuing 55th Annual General Meeting of the Company. The Nomination & Remuneration Committee of the Company has recommended the said appointment.
Mr. Shailyamanyu Singh Rathore resigned as Director of the Company effective May 8, 2019.
Mr. Ghanashyam Hegde was appointed as Additional Director (Non-Executive) of the Company by the Board of Directors of the Company effective May 9, 2019 to hold office upto the ensuing 55th Annual General Meeting of the Company. It is proposed to appoint Mr. Hegde as Non-Executive Director at the ensuing 55th Annual General Meeting of the Company. The Nomination & Remuneration Committee of the Company has recommended the said appointment.
Mr. Karthik Natarajan and Mr. Pramod Agarwal, Directors retire by rotation and being  eligible,  offer  themselves for re-appointment at the ensuing 55th Annual General Meeting of the Company.
Mr. Rajendra A. Shah completes his first tenure as Independent Director on September  23,  2019.  Owing  to personal reasons, Mr. Shah has offered himself for re-appointment for a period of one year only. Accordingly, the Board of Directors have approved re-appointment of Mr. Shah as an Independent Director for second tenure  of one year effective September 24,  2019,  subject  to the approval of the Shareholders of the Company at the ensuing 55th Annual General Meeting of the Company. The Nomination & Remuneration Committee of the Company has recommended the said re-appointment.
Mr. Bansidhar S. Mehta completes his first tenure as Independent Director on September  23,  2019.  Owing to personal reasons, Mr. Mehta has offered himself for re-appointment for a period of one year only. Accordingly, the Board of Directors have approved re-appointment of Mr. Mehta as an Independent Director for second tenure

of one year effective September 24, 2019, subject to    the approval of the Shareholders of the Company at the ensuing 55th Annual General Meeting of the Company. The Nomination & Remuneration Committee of the Company has recommended the said re-appointment.
Mr. Anil Kumar Gupta completes his first tenure as Independent Director on September 23, 2019. The Board of Directors have approved re-appointment of Mr.  Gupta as an Independent Director for second tenure of five years effective  September 24, 2019, subject to the approval    of the Shareholders of the Company at the ensuing 55th Annual General Meeting of the Company. The Nomination & Remuneration Committee of the Company has recommended the said re-appointment.
Ms. Flavia Machado was appointed as the Company Secretary and Compliance Officer of the Company effective September 18, 2018.
Brief profile of Directors proposed to be appointed/ re-appointed at the ensuing 55th Annual General Meeting and the details of the Directorships held by them in other companies are provided under the Corporate Governance section of the Report.
Appropriate resolutions for the appointment /re-appointment of the aforesaid Directors are being moved at the ensuing 55th Annual General Meeting, which the Board recommends for approval of the Shareholders of the Company.
The Independent Directors of your Company have given declaration of Independence to your Company stating that they meet the criteria of Independence as mentioned under Section 149(6) of the Companies Act, 2013 and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The details of training and familiarization programme  and Annual Board Evaluation process for Directors have been provided under the Corporate Governance section of the Report.
AUDITORS
Kalyaniwalla & Mistry LLP, Chartered Accountants were appointed as Statutory Auditors of your Company at the 53rd Annual General Meeting held on November 16, 2017 for a term of five consecutive years.
The Report given by the Statutory Auditors on the financial statements of the Company for the Financial Year ended June 30, 2019 is part of the Report. There has been no qualification, reservation or adverse remark given by the Auditors in their Report.

COST AUDITORS
Ashwin Solanki & Associates, Cost Accountants carried out the cost audit for applicable business during the Financial Year 2018-19. The Board of Directors has re-appointed Ashwin Solanki & Associates, Cost Accountants for the Financial Year 2019-20.

POLICIES
Your Company has adopted policies on related party transactions, corporate social responsibility, vigil mechanism, nomination and remuneration, materiality of events and dividend distribution policy, which are available on the website of the Company at http://www.pg.com/ en_IN/invest/pghh/corporate_governance/policies.shtml/.
The policy on DirectorÕs appointment and remuneration including criteria for determining qualifications, positive attributes, independence of Director, and remuneration for Key Managerial Personnel has been appended as Annexure V to this Report. The dividend distribution policy has been appended as Annexure VI to this Report.

SECRETARIAL AUDIT
Secretarial Audit was carried out by Dholakia & Associates LLP, Company Secretaries for the Financial Year 2018-19. There were no qualifications, reservation or adverse remarks given by the Secretarial Auditors of the Company. The Secretarial Audit report has been appended as Annexure VII to this Report.

SECRETARIAL STANDARDS
During the Financial Year, your Company has complied with the mandatory Secretarial Standards issued by the Institute of Company Secretaries of India.
TRADE RELATIONS
The Directors wish to thank the retailers, wholesalers, distributors, suppliers of goods & services, clearing and forwarding agents and all other business associates and acknowledge  their  efficiency  and  continued  support  in promoting such healthy growth in your CompanyÕs business.
ACKNOWLEDGEMENT
We are grateful to The Procter &  Gamble  Company, USA and its subsidiaries for their invaluable support in terms of access to the latest information / knowledge     in the field of research & development for products,
ingredients and technologies; timely inputs to exceptional marketing strategies; and the goodwill of its world- renowned Trademarks and superior brands. We are proud to acknowledge this unstinted association that has vastly benefited the Company.

The Directors also wish to thank the CompanyÕs consumers, employees and Shareholders for their support and contributions in the growth of the Company.




On behalf of the Board of  Directors


Mumbai	R. A. Shah
August 21, 2019	Chairman

ANNEXURE I
                          Business Responsibility Report for Financial Year 2018-19 SECTION A: GENERAL INFORMATION ABOUT THE COMPANY
Sr. No.
Particulars
Details
1.
Corporate Identity Number (CIN) of the Company
L24239MH1964PLC012971
2.
Name of the Company
Procter & Gamble Hygiene and Health Care Limited
3.
Registered address
P & G Plaza, Cardinal Gracias Road, Chakala, Andheri (East), Mumbai - 400099
4.
Website
www.pg.com/en_IN
5.
E-mail id
investorpghh.im@pg.com
6.
Financial Year reported
July 1, 2018 to June 30, 2019
7.
Sector(s)	that	the	Company	is	engaged	in (industrial activity code-wise)
Ayurvedic products (NIC 21003) Sanitary napkins (NIC 13996) Deodorants (NIC 20237)
8.
List three key products / services that the Company manufactures / provides
1. Health care Products
2. Hygiene Products
9.
Total number of locations where business activity is undertaken by the Company
(a) Number of International Locations
(b) Number of National Locations


None
The CompanyÕs business and operations are spread across the country. Details of location of plants are given below:
Plant locations Goa:
(1) 173, 314, 315, Kundaim Industrial Estate,
Kundaim, Goa - 403 115
Baddi:
(1) Khasara No. 1808-09, Village-Doria, Export Park, Thana, Near Indo Farm, PO. Baddi, Tehsil Nalagarh, Dist. Solan Himachal Pradesh - 173205
(2) Village Katha, Near Charak Pharma, PO. Baddi, Tehsil Nalagarh, Dist. Solan Himachal Pradesh -173205
10.
Markets served by the Company
The CompanyÕs products have a national presence and some of the products are also exported to other countries.

SECTION B: FINANCIAL DETAILS OF THE COMPANY

Sr. No.
Particulars
Details
1.
Paid up Capital
` 32.46 Crores
2.
Total Turnover
` 2,947 Crores
3.
Total profit after taxes
` 419 Crores
4.
Total Spending on Corporate Social Responsibility (CSR) as percentage of profit after tax (%)
` 12.74 Crores (3.04% of profit after tax)
5.
List of activities in which expenditure in point 4 above has been incurred
Refer Corporate Social Responsibility Report which is appended as Annexure II to the DirectorsÕ Report

Ethics & Corporate Responsibility





















Employees and individuals within our extended supply chain and operations are encouraged to speak
up and report concerns


P&G touches the lives of hundreds of millions of consumers in India. It motivates us to do more and be a force for good and a force for growth.
Community Impact



FLAGSHIP CSR PROGRAM
P&G group in India built and supported more than 2100 schools that
will impact more than 17 lakh underprivileged children

TIMELY DISASTER RELIEF
Supported those impacted by Kerala floods and cyclone FANI in Orissa through our disaster relief program


SUPPORTING SURROUNDING COMMUNITIES
Our offices, manufacturing sites & employees support local charities through donation and volunteering


OUR BRANDS MAKE A DIFFERENCE

Our Brands, Vicks and Whisper, made a difference to communities through various initiatives

Gender Equality
Diversity & Inclusion
Environmental Sustainability


		
LEVERAGING OUR VOICE IN ADVERTISING AND MEDIA
Our campaigns like Time to #SitImproper and #WhispersBreakSilence spark conversations to bring change

EMPOWERING MARGINALISED GIRLS THROUGH EDUCATION
Supporting KGBV schools across Rajasthan and Jharkhand to provide holistic education to girl children

Committed to empower women entrepreneurs


CREATING AN INCLUSIVE WORK ENVIRONMENT
Embracing equality at the workplace and
creating change like in our Mandideep distribution center
 FLEX@WORK
Our Flex@Work program enables our people to effectively manage personal needs and their careers

    MARCª
Launched the MARCª program to build inclusive leadership skills throughout our Company

GABLE NETWORK
Set up the GABLE network to foster workplace equality for LGBT+ employees


VICKS
TOUCH OF CARE
Vicks took a bold stand, sending a powerful message to help pave the way towards a more inclusive society

REDUCING OUR FOOTPRINT
Within our operations, we continuously strive to reduce our carbon footprint and improve efficiency

ZERO MANUFACTURING WASTE TO LANDFILL
All our manufacturing facilities in India are zero manufacturing waste to landfill

RECYCLE PACKAGING WASTE
Working with waste management companies and industry to collect, segregate and recycle multi-layered plastic packaging waste

SECTION C: OTHER DETAILS

Sr. No.
Particulars
Details
1.
Does the Company have any Subsidiary Company
/ Companies?
The Company does not have any Subsidiary Company
2.
Do the Subsidiary Company / Companies participate in the BR Initiatives of the parent company? If  yes, then indicate the number of such subsidiary
company(s)
Not applicable, as the Company does not have any Subsidiary Company
3.
Do any other entity / entities (e.g. suppliers, distributors etc.) that the Company does business with, participate in the BR initiatives of the Company?
Your CompanyÕs Sustainability Guidelines for External Business Partners set our expectations with our external partners with regard to Social and Environmental Responsibility. We actively seek business relationships with partners that share these values, and that promote high standards within their own supply chains. Our risk-based audit program supports this effort by assessing partners through third-party audits, and identifying and remediating issues. We strive to effect change in our supplier base when we identify improvement opportunities, and this    is an important way we fulfill our purpose. We want to build a robust system of External Business Partners that is fully integrated and synchronized with your CompanyÕs
business and values.
SECTION D: BUSINESS RESPONSIBILITY INFORMATION
1. Details of Director / Directors responsible for Business Responsibility
The Corporate Social Responsibility Committee of the Company is responsible for the Business Responsibility policies of the Company.
Details of the Directors responsible for implementation of the Business Responsibility policies:

1.
DIN
02588131
08158357
06685891
06808527
2.
Name
Mr. A. K. Gupta
Mr. M. Gopalan
Mr. K. Natarajan
Ms. S. Dhawan
3.
Designation
Independent Director
Managing Director
Non-Executive Director
Non-Executive Director
2. Principle-wise (as per NVGs) Business Responsibility Policy(ies)
All successful and sustainable companies have one thing in common Ð good governance practices. Your Company believes in ÒDoing the Right Thing, EverytimeÓ. Your  Company has a strong history of operating with integrity -      at all levels, both internally and externally. Our actions and the actions of all our employees are governed by our Purpose, Values and Principles (PVPs). Your Company reinforces responsibilities on all its employees, of observing high standards of Corporate Governance through the CompanyÕs ÒWorldwide Business Conduct ManualÓ which sets forth managementÕs commitment to conduct its business affairs with high ethical standards. These standards flow from the following core values of the Company:
¥ Treat the CompanyÕs assets as you would treat your own;
¥ Behave with the CompanyÕs long term success in mind;
¥ Always do the right thing; and
¥ Operate within the letter and spirit of law.
Business Responsibility Principles:

Principle 1: Ethics, Transparency and Accountability (P1)
Principle 6: Environment Protection (P6)
Principle 2: Safe Products & Products Lifecycle Sustainability (P2)
Principle 7: Policy Advocacy (P7)
Principle 3: EmployeesÕ Well-being (P3)
Principle 8: Inclusive Growth (P8)
Principle 4: Stakeholder Engagement (P4)
Principle 9: Customer Value (P9)
Principle 5: Human Rights (P5)





Details of compliance:

Sr.
No.
Questions
P1
P2
P3
P4
P5
P6
P7
P8
P9
1.
Do you have a policy/policies for the relevant Principle?
Y
Y
Y
Y
Y
Y
Y
Y
Y
2.
Has the policy being formulated in consultation with the relevant stakeholders?
Y
Y
Y
Y
Y
Y
Y
Y
Y
3.
Does the policy conform to any national / international standards?
The World-wide business conduct manual and the Human Rights policy statement follows UN guiding principles on Business & Human Rights
4.
Has the policy being approved by the Board?
Y
Y
Y
Y
Y
Y
Y
Y
Y
5.
Does the Company have a specified Committee of the Board / Director / Official to oversee the implementation of the policy?
Y
Y
Y
Y
Y
Y
Y
Y
Y
6.
Indicate the link for the policy to be viewed online
https://us.pg.com/policies-and-practices/ worldwide-business-conduct-manual/
7.
Has the policy been formally communicated to all relevant internal and external stakeholders?
Y
Y
Y
Y
Y
Y
Y
Y
Y
8.
Does the company have in-house structure to implement the policies?
Y
Y
Y
Y
Y
Y
Y
Y
Y
9.
Does the Company have a grievance redressal mechanism related to the policy(ies) to address stakeholdersÕ grievances related to the policy(ies)?
Y
Y
Y
Y
Y
Y
Y
Y
Y
10.
Has the Company carried out independent audit / evaluation of the working of this policy by an internal or external agency?
Y
Y
Y
Y
Y
Y
Y
Y
Y
Note: Y = Yes

3. Governance related to Business Responsibility
Your Company operates within the spirit and letter of the law, maintaining high ethical standards wherever we conduct business. We believe that good governance practices contribute to better results for stakeholders. We maintain governance principles, policies and practices that support management accountability. These are in the best interest of the Company, our shareholders and all stakeholders, and they are consistent with the CompanyÕs Purpose, Values and Principles.
The Corporate Social Responsibility Committee and the Board of Directors assess the Business responsibility performance annually. The Business Responsibility Report shall be issued annually along with the Annual Report of the Company. The Business Responsibility Report can be viewed at www.pg.com/en_IN.

SECTION E: PRINCIPLE-WISE PERFORMANCE
Principle 1: Ethics, Transparency and Accountability
Your Company is committed to being a good corporate citizen and doing the right thing. Our Purpose, Values

and Principles (PVPs) are the foundation of the Company. Our objective is to create industry-leading value by maintaining and enhancing our strong corporate reputation through a strong ethics and compliance culture. We operate within the spirit and letter of the law, maintaining high ethical standards wherever we conduct business. We believe that good governance practices contribute to better results for Shareholders. We maintain governance principles, policies and practices that support management accountability.
These are in the best interest of the Company and our Shareholders, and they are consistent with the CompanyÕs PVPs. Your Company reinforces responsibilities on all its employees, of observing high standards of Corporate Governance through the CompanyÕs Worldwide Business Conduct Manual which sets forth managementÕs commitment to conduct its business affairs with high ethical standards. The Sustainability Guidelines for External Business Partners explain the global standards to be followed by the External Business Partners in their daily business activities on behalf of the Company. External business partners and their suppliers are expected to share your CompanyÕs commitment to these standards.

Your Company being a part of the Procter & Gamble group is guided by a Whistle Blower Policy as laid down in its Worldwide Business Conduct Manual. Any employee or other interested person can call on The Worldwide  Business Conduct Helpline, twenty-four hours a day, seven days a week, to report any concerns about violations of the CompanyÕs Worldwide Business Conduct Standards. The Worldwide Business Conduct Helpline is not staffed or monitored by the Company personnel. All calls can be completed anonymous if the caller desires. The Helpline can take calls in most languages spoken by employees around the world. Calls made to the Helpline are reported to the CompanyÕs Corporate Security and Legal personnel, who will ensure appropriate investigation and follow-up of all calls. Callers are given a confidential identification number so they can inquire about the status of their reported concerns. The Worldwide Business Conduct Helpline is accessible to all employees. In compliance with the requirement under the SEBI Listing Regulations, 2015 and Section 177 of the Companies Act, 2013 and the Rules made thereunder, the Company has adopted the whistle blowing policy as the vigilance mechanism for Directors and employees to report genuine concerns or grievances such as unethical behaviour, actual or suspected fraud or violation of the CompanyÕs code of conduct or ethics policy. The Audit Committee oversees the vigil mechanism and number of cases reported alongwith the status report and action taken (if any) are reported to the Committee. During the Financial Year, 7 complaints were received. These cases are dealt with in accordance with the Worldwide Business Conduct Manual.

Principle 2: Safety and Sustainability throughout the life cycle
In order to improve lives, now and for generations to come, we ensure that our products, packaging and operations are safe for employees, consumers and the environment. We ensure this with a focus on technologies, processes and improvements that matter for the environment. Product quality and safety are of the utmost importance to your Company. Our purpose is to make superior products that not only delight consumers but are also produced responsibly. Customers choose your Company because we provide products of superior quality and value that improve the lives of the consumers. Just as we provide safe, quality products, we expect our suppliers to assure the quality and safety of the products and services they provide to us.
Your Company continuously strives to deliver products with an improved environmental profile. To reduce the environmental impact of our products your Company
uses life cycle analysis to understand where the biggest impact exists, so we know where to focus our innovation. Our deep understanding of the consumer enables us to develop sustainable products that will delight the consumer, without tradeoffs in price or performance.
Your Company is focused on the environmental performance of our entire supply chain, including our own manufacturing facilities, our suppliers, and the logistics of our finished products. Your Company is focused on creating efficiencies in energy, water, waste, and emissions.
Our sustainability work goes beyond the core of our manufacturing operations, extending to a holistic end-to-end view of opportunities. We deliver strong results across the supply chain, ranging from manufacturing to finished product logisticsÑengaging our suppliers throughout the process:
¥ Manufacturing: Between the procurement of raw materials and the creation of a product, we strive     to reduce waste, water, energy, and CO2 through systemic conservation efforts. We apply smart eco-design through innovative construction process improvements. And, we re-use where feasible, giving new life to what was once waste.
¥ Finished Product Logistics: In the logistics stage, we reduce waste in customization by applying more sustainable designs. We have also optimized our transportation efficiency by making changes to the rate, route, mode and method  of  transportation.  We have focused on eliminating inefficiencies such as loading and unloading delays, rush transport up-charges, dead legs (empty trucks) and P&G production line stops.
¥ Supplier Engagement: We collaborate closely with suppliers across the entire supply chain. We have implemented a supplier sustainability scorecard, which assesses the environmental footprint of our suppliers, enabling your Company to partner and help reduce the environmental impact along the supply chain.
Your Company ensures that it meets all applicable legislative and regulatory requirements related to product quality, safety and labeling.
Principle 3: Employee Well-Being
For your Company, people are its most valuable asset. Accordingly, we are committed to the highest standards of safety to protect the employees as well as external parties who work at or visit the Company sites.
Your Company ensures fair employment practices and also encourages employee Engagement and Participation by:
¥ Ensuring Health and Safety of all the employees

¥ Providing Safe work environment
¥ Encouraging diverse workforce, non-discriminated
opportunities
¥ Freedom of forming Association
¥ Continuous Learning, etc.
Your Company has various Employee Centric policies in place and thereby resulting in motivated work force and better organization to work with.
Your CompanyÕs annual objectives were renewed in 2018, as part of which, creation of a highly engaged, business focused organization was identified as  a  key  priority.  An engagement strategy was developed to emphasize employee engagement and continue to position the Company as an exciting  and  inspiring  place  to  work, in line with our business strategy. The engagement strategy was co-created with employees, with an aim to ensure key interventions throughout the year, headed by business leaders and enrolling the entire organization. These interventions were focused around Diversity & Inclusion, Skill & Capability Development, and Community Impact.
In an era of single parenting, caring for ageing parents or supporting a special needs child, your Company sought to modernize our signature flex@work program to provide location and time flexibility for modern families. Flex@ work is designed to intentionally drive a culture change around flexibility to enable all employees to be fully engaged by supporting work-life integration, empowering employees to personalize their schedules directly with their managers.
The strategy targeted engagement through a number of interventions including best in class recruitment practices, meaningful learning & development opportunities, digital capability building and opportunities for individuals to innovate. A career co-creation program was developed to provide inspirational & meaningful experiences and opportunities for competency development through a balanced career co-creation process to deliver Company results and individual career aspirations. The career co-creation process involves senior leadership actively engaging in the development of career plans, supporting an individual in obtaining key experiences that are required for future roles. Through this process, the principle of ÔStaff to WinÕ is achieved, ensuring that the right people are in the right roles and are able to effectively deliver business objectives.
Your  Company forbids the use of child or forced labor   in any of its operations or facilities. Your Company fully respects and follows all applicable labour laws.
Your Company respects every employeeÕs right  to choose to join or not to join a trade union, or to have recognized employee representation in accordance with applicable law.
As on June 30, 2019, your Company had a total of 380 permanent employees, including 81 permanent women employees. 390 persons were engaged on temporary / contractual basis. During the Financial Year, the Company did not receive any complaints relating to child labour, forced labour, involuntary labour, or discriminatory employment. Your Company  had received one complaint on sexual harassment, which was solved during the year and no complaints were pending as on June 30, 2019. All the employees and persons engaged on temporary / contractual basis were given safety & skill up-gradation training.

Principle 4: Stakeholder Engagement & Relation
Your Company actively  engages  with  various  internal & external stakeholders, which include, employees, consumers, customers, shareholders, external business partners and the government.
Your Company believes that only way to build a sustainable business is to improve lives. It engages with disadvantaged, vulnerable and marginalized stakeholders through its Corporate Social Responsibility initiatives, which include P&G Shiksha and Timely Disaster Relief.
The CompanyÕs CSR initiatives are elaborated in the CSR Report which is appended as Annexure II to the DirectorsÕ Report.

Principle 5: Human Rights
Our core values as a Company include treating everyone with respect. We have a strong non-discrimination policy and have zero tolerance for unlawful discrimination.  Your Company advocates for all employees, regardless of race, religion, gender, sexuality, age or disability. We respect everyoneÕs right to be who they are, and want all employees to feel safe, included and able to bring their whole selves to work.
Your Company had undertaken following initiatives for employees to work in an inclusive environment that values and respects who they are:
¥ GABLE network
Your Company has taken a stand for inclusion and addition of sexual orientation to its non-discrimination policies. We have set up the ÔGABLE networkÕ for fostering workplace equality for Lesbian, Gay, Bisexual and Transgender (LGBT+) employees.

¥ Vicks- #TouchofCare
In India, homosexuality is mostly kept closeted and being transgender is considered an unspoken curse. Vicks took a bold stand, sending a powerful message to help pave the way towards a more inclusive society and challenging conventional thinking of the society for a better change.
¥ Whisper-#TimetositImproper and #WhispersBreakSilence
WhisperÕs ÔSit ImproperÕ campaign focused on breaking the age-old stereotypes about gender expectations. It was based on the insight that Indian girls are expected to live by a set of standards imposed upon them by the society - from the way they should sit, to even the aspirations they must pursue or not pursue. The movement created a revolution and gave women the license to sit the way they want without the fear of being judged.
WhisperÕs digital campaign #WhispersBreakSilence showcased that every whisper of encouragement plays an essential role in breaking the silence around periods, it was also a salute to millions of teachers, fathers, mothers, elder sisters or best friends whoÕve broken silence with words of encouragement. In a country where superstition was passed silently, we broke it with a whisper.
The Human Rights Policy statement extends to all the employees and all stakeholders associated with the Company. No complaints with respect to Human Rights violation were received by the Company during the Financial Year.
Principle 6: Environment Protection
Protecting the earth is both a responsibility and a business opportunity. Our goal is to create brands that enable consumers to make more sustainable choices. We have integrated sustainability into our business practices, operations, innovation, brand building and culture. The environment sustainability guidelines of the Company cover both the Company and other people associated with the Company.
Environmental sustainability is embedded in your CompanyÕs Purpose, Values, Principles, and business. We are committed to improving lives, now and for generations to come by ensuring that our products, packaging and operations are safe for employees, consumers and the environment. We ensure by focusing on technologies, processes and improvements that matter for the environment.
As a responsible corporate citizen, Environmental sustainability is one of our focus areas and we continue to positively impact the communities we operate in. For your Company, acting responsibly is core to the way we do business. Our purpose is to make superior products that not only delight consumers but are also produced responsibly.
Your CompanyÕs broad-reaching environmental sustainability goals designed to enable responsible consumption and sustainable manufacturing are as follows:
a. All our brands will enable responsible consumption through packaging that is 100% recyclable or reusable by 2030; and
b. By 2030, 100% of manufacturing sites across the globe will cut greenhouse gas emissions in half as compared to our 2010 baseline.
Within our operations, we strive to grow responsibly, continuously improve our efficiency while reducing our carbon footprint. The Goa manufacturing plant  is  a  Ôzero waste to landfillÕ site which means that there is no manufacturing discharge into the environment. In the last 5 years, the Goa plant has reduced its carbon emission by 18%. During this period, the plant has also improved on both energy and water by 75%. The plant is also leveraging technology, experts, employees and renewable sources of energy to reduce our overall footprint and make our operations more sustainable.
We are committed to help reduce the flow of plastic by making changes now and bringing long-term solutions. In India, we have put in place a system to recover and recycle multi-layered plastic packaging waste. We are working with various waste management companies and the industry to collect, segregate and recycle multi-layered plastic packaging waste.

Principle 7: Business Policy & Advocacy
As a corporate citizen, your Company often engages in efforts to affect legislation or government policy on issues that could impact our business and society at  large.  Your Company ensures that all its advocacy activities  are consistent with its Purpose, Values & Principles and applicable laws.
Your Company is a member of the following trade and chambers of association, through which advocacy was conducted in listed areas:
Ð Federation of Indian Chambers of Commerce & Industry

Ð Confederation of Indian Industry
Ð Feminine and Infant Hygiene Association of India
Ð American Chamber of Commerce in India
Ð US India Business Council
Ð India Home & Personal Care Industry Association
Some of the key issues on which your Company engaged with the Government in 2018-19 through the above associations include:
Ð Solid Waste Management Rules
Ð Plastic Waste Management Rules
Ð GST implementation
Ð Legal Metrology and Standard packaging Rules
Ð Data Protection Bill

Principle 8: Inclusive growth and Equitable development
Your Company believes that the only way to build a sustainable business is to improve lives. For your Company, sustainability means making every day better for people through how we innovate and how we act. As one of the worldÕs largest consumer products Company, we have both a responsibility and an opportunity to do the right thing and create change. This strategy has inspired an enduring CSR strategy supported by two pillars Ð P&G Shiksha and Timely Disaster Relief. While P&G Shiksha provides children from underprivileged backgrounds with an access to a holistic education, P&GÕs disaster relief activities aim to rehabilitate and empower the victims of natural disasters by providing them with daily essential commodities and safe drinking water.
Your Company has undertaken CSR initiatives  during the Financial Year amounting to ` 12.74 Crores which are detailed in the CSR Report which is appended as Annexure II to the DirectorsÕ Report.

Principle 9: Customer Value and Responsibility
We are committed to providing products and services that can help improve the lives of our consumers. In developing and marketing our products, we adopt a ÒConsumer Is BossÓ approach to ensure that we delight consumers    by launching new products and product improvements that genuinely meet their needs. We actively encourage consumers to contact us because we want to hear about our consumersÕ experiences with our products.
Our aspiration is to serve the worldÕs consumers better than our best competitors, in every category and every country where we choose to compete Ñ creating  superior shareholder value in the process. Innovation is at the heart of your CompanyÕs business. It differentiates our brands versus competition and prevents commoditization of our categories and brands. ItÕs how we delight consumers, create value with retail partners, and create new businesses. Your Company combines ÒwhatÕs neededÓ with ÒwhatÕs possible,Ó conducting hundreds of consumer research studies each year to understand what people need and want, in order to create superior value and product experience every day.
ANNEXURE II
Annual Report on Corporate Social Responsibility
(Pursuant to Companies (Corporate Social Responsibility Policy) Rules, 2014)
1. Brief outline of the CompanyÕs CSR policy
Doing the right thing is the foundation of your CompanyÕs Purpose, Values, and Principles. It is naturally woven into the way we work every day Ñ paying competitive wages, working consistently with our retailers and suppliers, preventing conflicts of interest, ensuring consumer privacy and maintaining financial stewardship. This approach to business is at the heart of all we do at P&G. Doing the right thing also includes investing in the communities in which we live, work, and serve. At its core, P&GÕs Social Responsibility efforts aim to improve lives.
Companies Act, 2013 (ÒActÓ) highlights the importance of Corporate Social Responsibility (ÒCSRÓ) as a strategic tool for sustainable growth of the people, the communities we operate in and the Company as a whole. In line with the global principles followed by the Procter & Gamble group and the terms of Act, the policy on Corporate Social Responsibility is broadly framed taking into account the following:
1. We believe itÕs essential to run our business responsibly, and our operating practices reflect this commitment.
2. P&G is focused on making every day better for people and the planet through our innovations and our actions:
i) Environment by- Conservation of Resources, Using Renewable Resources, Generating Worth from Waste;
ii) Social by- providing the comforts of home, improving health and hygiene of people, social and cultural development, imparting education, training and social awareness.
The Corporate Social Responsibility activities to be undertaken by the Company, include, but are not limited to the following:
a. Social and cultural development by:
¥ Imparting education, training (vocational and
skill based) and creating social awareness;
¥ Awareness programs on girl education;
¥ Empowerment of women for education/
health & self-employment;
¥ 
Empowerment of differentially abled children
and their self-development;
¥ Skill development and generation of
employment by locally driven initiatives;
¥ Promoting preventive health care and sanitation by providing health and hygiene products;
¥ Making available safe drinking water;
¥ Promoting sports and cultural activities;
¥ Creating awareness and development of
infrastructure for sports and cultural activities;
¥ Measures  for  the  benefit  of  armed  forces
veterans, war widows and their dependents;
¥ Relief and support to victims of natural
calamities in any part of the country.

b. Ensuring Environmental Sustainability by:
¥ Conservation of resources by design and manufacture of products that maximize the conservation of resources;
¥ Utilization of renewable energy and renewable
or recycled materials;
¥ Generating Worth from Waste.

c. Any other objectives as mentioned under Section
135 of the Act and/ or relevant Rules and Schedules.
The Corporate Social Responsibility Policy is available on the website of the Company at http://www. pg.com/en_IN/invest/pghh/corporate_governance/ policies.shtml.

The composition of the CSR Committee as on date: Mr.  Anil Kumar Gupta	Chairman
Mr. Madhusudan Gopalan        Member
Mr. Karthik Natarajan	Member
Ms. Sonali Dhawan	Member

2. Average net profit of the company for last three Financial Years Ð ` 637.18 Crores
3. Prescribed CSR expenditure (2% of amount as in item 2) Ð ` 12.74 Crores






4. Details of CSR spend during Financial Year:
a) Total amount to be spent for the Financial Year Ð ` 12.74 Crores
b) Amount unspent, if any Ð Not applicable
c) Manner in which the amount spent during the Financial Year is as detailed below:

Sr.
no.
CSR project or activity identified
Sector in which the Project is covered
Projects or programs
(1) Local area or other
(2) Specify State & district where projects programs were undertaken
  Amount outlay (budget) project or program
        wise        (` in Crores)
Amount spent on the projects or programs
      Cumulative expenditure upto the reporting
      period     (` in Crores)
Amount spent: Direct or through implementing agency





  Total (` in Crores)
      Direct expenditure
Overheads


1
P&G Shiksha: Read India Program
Education: Remedial Learning & Early Childhood Education
Uttar Pradesh, Rajasthan, Madhya Pradesh, Himachal Pradesh, Telangana, Uttarakhand, Bihar, Delhi
3.30
3.35
93%
7%
3.35
Implementing agency: Pratham Education Foundation
2
P&G Shiksha: Build & Support Schools
Education: Infrastructure Interventions
Pan-India
3.31
3.30
100%
Nil
3.30
Implementing agency: Round Table India Trust
3
P&G Shiksha: Supporting communities around our plants
Education: Interventions in a Govt. School in Mandideep
Mandideep (Madhya Pradesh)
0.15
0.15
94%
6%
0.15
Implementing agency: Arushi Society
4
P&G Shiksha: Supporting communities around our plants
Education: Interventions in a Public Charitable Trust for orphan, destitute and abandoned children
Goa
0.08
0.08
100%
Nil
0.08
Implementing agency: Matruchhaya
5
P&G Shiksha: Read India Program
Education: Remedial Learning
Mysore
0.15
0.12
93%
7%
0.12
Implementing agency: Pratham Mysore
6
P&G Shiksha: Supporting Defence NGOs to educate underprivileged children
Education: Support Sankalp School Mumbai - a special school for differently abled children
Mumbai (Maharashtra)
0.35
0.33
90%
10%
0.33
Implementing agency: Navy Wives Welfare Association
7
P&G Shiksha: Supporting Defence NGOs to educate underprivileged children
Education: Support Umeed Schools through AFWWA Ð school for the underprivileged
Delhi
0.35
0.33
90%
10%
0.33
Implementing agency: Air Force Wives Welfare Association
8
P&G Shiksha: Supporting Defence NGOs to educate underprivileged children
Education: Support Asha Schools, APS Leh and Education of Girl Children for Army Widows through AWWA
Delhi, Leh
0.75
0.78
90%
10%
0.78
Implementing agency: Army Wives Welfare Association
9
P&G Shiksha: Supporting Education of Marginalised Girls and children in rural areas
Education: Support Girl Child Education through KGBV Schools in Rajasthan and Jharkhand
Rajasthan and Jharkhand
2.1
2.1
89%
11%
2.1
Implementing agency: Save The Children
10
P&G Shiksha: Supporting remedial learning via digital learning
Education: Support remedial learning leveraging digital platforms
Rajasthan & Madhya Pradesh
2
2
95%
5%
2
Direct with the help of Educational Initiatives (EI)
11
P&G Shiksha: Supporting education & infrastructure in Himalayan Belt
Education & Infrastructure: Electrification of a village near Leh and setting up educational hubs
J&K
0.2
0.2
90%
10%
0.2
Direct with the help of Global Himalayan Expedition (GHE)
5. In case the Company has failed to spend two percent of the average net profit of the last three Financial Years or any part thereof, the Company shall provide the reasons for not spending the amount in its Board Report: Not applicable
6. The CSR committee confirms that the implementation and monitoring of CSR activities, is in compliance with CSR objectives and policy of the Company.


Madhusudan Gopalan	A. K. Gupta
Managing Director	Chairman of the CSR Committee
ANNEXURE III
EXTRACT OF ANNUAL RETURN
Form No. MGT-9
(As on the Financial Year ended on June 30, 2019)
[Pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014]
I. REGISTRATION AND OTHER DETAILS

i)
CIN
:
L24239MH1964PLC012971
ii)
Registration Date
:
July 20, 1964
iii)
Name of the Company
:
Procter & Gamble Hygiene and Health Care Limited
iv)
Category / Sub-Category of the Company
:
Company limited by shares / Indian Non-Government Company
v)
Address of the Registered Office and contact details
:
P & G Plaza, Cardinal Gracias Road, Chakala, Andheri (East), Mumbai - 400 099
Tel : 022-2826 6000; Fax: 022-2826 7337
Website : www.pg.com/en_IN
vi)
Whether listed company
:
Yes
vii)
Name, Address and contact details of Registrar and Transfer Agent, if any :
:
Link Intime India Private Limited C-101, 247 Park, LBS Marg,
Vikhroli (West), Mumbai - 400 083
Tel Ð (022) 4918 6270, Fax Ð (022) 4918 6060
e-mail Ð rnt.helpdesk@linkintime.co.in

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY

Sr.
No.
Name and Description of Products
NIC Code of the Product
% to total turnover of the Company
1.
Ayurvedic products
21003
30
2.
Sanitary napkins
13996
69
III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES
Holding Company [Section 2(46)]

Sr.
No.
Name and address of the Company
CIN/GLN
% of shares held
1.
The Procter & Gamble Company, USA
(Ultimate Holding Company)
Not applicable
(Foreign Company)
Holds 70.64% through its subsidiaries
2.
Procter & Gamble Overseas India B.V., Netherlands
(Holding Company)
Not applicable
(Foreign Company)
Holds 68.73% directly
The Company does not have any subsidiary companies or associate companies.
IV. SHARE HOLDING PATTERN (EQUITY SHARE CAPITAL BREAKUP AS PERCENTAGE OF TOTAL EQUITY)
i. Category-wise Shareholding

Sr.
No.
Category of Shareholders
No. of Shares held at the beginning of
the year
No. of Shares held at the end
of the year
%
change during
the
year


Demat
Physical
Total
% of total
shares
Demat
Physical
Total
% of total
shares

A.
Promoters









1.
Indian










Bodies corporate
619683
Ñ
619683
1.91
619683
Ñ
619683
1.91
0.00


Sr.
No.
Category of Shareholders
No. of Shares held at the beginning of
the year
No. of Shares held at the end
of the year
%
change during
the
year


Demat
Physical
Total
% of total
shares
Demat
Physical
Total
% of total
shares

2.
Foreign










Bodies corporate
22310090
Ñ
22310090
68.73
22310090
Ñ
22310090
68.73
0.00

Total Promoter
Shareholding (A)

22929773

Ñ

22929773

70.64

22929773

Ñ

22929773

70.64

0.00
B.
Public Shareholding









1.
Institutions










Mutual funds
1652268
Ñ
1652268
5.09
1566126
Ñ
1566126
4.82
-0.27

Alternate Investment
Funds

10160

Ñ

10160

0.03

16751

Ñ

16751

0.05

0.02

Financial Institutions
/ Banks

778765

4956

783721

2.41

1202035

4736

1206771

3.72

1.31

Insurance Companies
823104
Ñ
823104
2.54
823083
Ñ
823083
2.53
-0.01

Foreign Institutional
Investors

1179569

393

1179962

3.63

1097894

Ñ

1097894

3.38

-0.25

Sub Total (B)(1)
4443866
5349
4449215
13.70
4705889
4736
4710625
14.50
0.80
2.
Non-Institutions










Bodies Corporate










- Indian
994534
6965
1001499
3.09
827401
6730
834131
2.57
-0.52

Individuals










- Individual shareholders holding nominal share capital up to
` 1 lakh




3051446




344369




3395815




10.46




3181740




252345




3434085




10.58




0.12

- Individual shareholders holding nominal share capital
in excess of ` 1 lakh



359578



Ñ



359578



1.11



257464



0



257464



0.79



-0.32

Others










- NBFCs registered
with RBI

44456

Ñ

44456

0.14

1786

Ñ

1786

0.01

-0.13

- Clearing Members
3595
Ñ
3595
0.01
3239
Ñ
3239
0.01
0.00

- HUF
85656
210
85866
0.26
82873
210
83083
0.26
0.00

- Foreign National
430
Ñ
430
0.00
430
Ñ
430
0.00
0.00

- NRI
25982
30
26012
0.08
26247
30
26277
0.08
0.00

- NRN
134537
3616
138153
0.43
134441
3616
138057
0.43
0.00

- Director / Relatives
17326
Ñ
17326
0.05
17351
Ñ
17351
0.05
0.00

- Trust
610
Ñ
610
0.00
432
Ñ
432
0.00
0.00

- Central
Government / State Government(s)


8408


Ñ


8408


0.03


8408


Ñ


8408


0.03


0.00

- IEPF
Ñ
Ñ
Ñ
Ñ
15595
Ñ
15595
0.05
0.05

Sub Total (B)(2)
4726558
355190
5081748
15.66
4557407
262931
4820338
14.86
-0.80

Total Public
Shareholding (B)

9170424

360539

9530963

29.36

9263296

267667

9530963

29.36

0.00

Shares held by Custodian for GDRs &
ADRs (C)


Ñ


Ñ


Ñ


Ñ


Ñ


Ñ


Ñ


Ñ


Ñ

Grand Total (A+B+C)
32100197
360539
32460736
100.00
32193069
267667
32460736
100.00
0.00
ii. Shareholding of Promoters

Sr.
No.
ShareholderÕs name
Shareholding at the beginning of the year
Shareholding at the end of the year
 % change in share holding during the
year


No. of shares
%  of total
   Shares of the Company
% of Shares Pledged / encumbered
to total shares
No. of shares
%  of total
   Shares of the Company
% of Shares Pledged / encumbered
to total shares

1.
Procter and Gamble Overseas India B.V.
22310090
68.73
Ñ
22310090
68.73
Ñ
0.00
2.
Temple Trees Impex & Investment Pvt Ltd
619683
1.91
Ñ
619683
1.91
Ñ
0.00


22929773
70.64
Ñ
22929773
70.64
Ñ
0.00
iii. Change in PromotersÕ Shareholding

Sr.
No.
Name of Shareholder
Shareholding at the beginning and end of the year
     Date of change in shareholding
    Increase/ Decrease in shareholding
Reason for increase / decrease
Cumulative Shareholding during the year


No. of shares
%  of total
   Shares of the Company



No. of shares
   % of total Shares of the Company
There was no change in Promoter shareholding during the Financial Year 2018-2019.
iv. Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and Holders of GDRs and ADRs) as on June 30, 2019
The detailed changes in top ten shareholders during the Financial Year 2018-19 shall be displayed on the website of the Company.
v. Shareholding of Directors and Key Managerial Personnel

Sr.
No.
Name of Director
Shareholding at the beginning and at the end of the year
 Date of change of Shareholding
   Increase / Decrease in shareholding
Reason for
change
    Cumulative Shareholding during the year (No. of Shares)


No. of Shares
% of total shares of
      the Company




1.
Mr. R. A. Shah
12906
0.04
01 July, 2018





12906
0.04
30 June, 2019
Ñ
No change during the year
12906
2.
Mr. B. S. Mehta
3799
0.01
01 July, 2018





3799
0.01
30 June, 2019
Ñ
No change during the year
3799
3.
Mr. Pramod Agarwal
0
0.00
01 July, 2018





25
0.00
17 May, 2019
0.00%
Purchase
25

Note: No other Directors apart from the above mentioned Directors, held any shares of the Company during the Financial Year 2018-19.

V. INDEBTEDNESS
The Company had no indebtedness with respect to secured or unsecured loans or deposits during the Financial Year 2018-19.

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
A. Remuneration to Managing Director:

Sr.
No.
Particulars of Remuneration
Mr. Madhusudan
Gopalan *
(Amount in ` Lakhs)
1.
Gross salary


(a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961
438.28

(b) Value of perquisites u/s 17(2) Income-tax Act, 1961
0.62

(c) Profits in lieu of salary under section 17(3) Income tax Act, 1961
Ñ
2.
Stock Option
Ñ
3.
Sweat Equity
Ñ
4.
Commission
Ñ
5.
Others, please specify
119.31*

Total (A)
558.21

Ceiling as per the Act
2975.37
*	Mr. Madhusudan Gopalan has exercised Stock Options of the Ultimate Holding Company amounting to ` 1,19,30,799 under its Employee Stock Option Plan

B. Remuneration to other Directors:

Particulars of Remuneration
Mr.  R. A.
Shah
Mr. B. S.
Mehta
Mr.  A. K.
Gupta
Mr. P.
Agarwal
Ms. M.
Ganesh
Total
Fee for attending board / committee meetings
3.80
3.20
5.00
2.30
0.50
7.78
Commission
12.00
12.00
12.00
12.00
3.43
51.42
Total
15.80
15.20
17.00
14.30
3.93
59.20

C. Remuneration to Key Managerial Personnel other than Managing Director / Manager / Whole Time Director:

Sr.
No.
Particulars of Remuneration
   Mr. Prashant Bhatnagar* CFO
(` In lakhs)
Ms. Flavia Machado# Company Secretary
(` In lakhs)
1.
Gross salary
(a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961
(b) Value of perquisites u/s 17(2) Income-tax Act, 1961
(c) Profits in lieu of salary under section 17(3) Income-tax Act, 1961




45.57
11.49


2.18
Ñ


Ñ
Ñ
2.
Stock Option
Ñ
Ñ
3.
Sweat Equity
Ñ
Ñ

Sr.
No.
Particulars of Remuneration
   Mr. Prashant Bhatnagar* CFO
(` In lakhs)
Ms. Flavia Machado# Company Secretary
(` In lakhs)
4.
Commission
Ñ
Ñ
5.
Others, please specify
Ñ^
Ñ

Total
47.75
11.49

*	Mr. Prashant Bhatnagar receives salary from another group Company, Gillette India Limited and the Company contributes towards the same in proportion to its Net Outside Sales

^	Mr. Prashant Bhatnagar has exercised Stock Options of the Ultimate Holding Company amounting to ` 2,14,96,488 under its Employee Stock Option Plan, which was charged to group Company, Gillette India Limited

#	Ms. Flavia Machado was appointed as Company Secretary of the Company w.e.f. September 18, 2018

VII. PENALTIES / PUNISHMENT/ COMPOUNDING OF OFFENCES
There were no penalties / punishment / compounding of offences for breach of any section of Companies Act against the Company or its Directors or other officers in default, if any, during the Financial Year.

ANNEXURE IV
Statement of Disclosure of Remuneration under Section 197 of Companies Act, 2013 and Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
i. Ratio of remuneration of each Director to the median remuneration of the employees of the Company for the Financial Year

Name of Director

Designation
Remuneration (` in lakhs)
Commission (` in lakhs)
Sitting Fees (` in lakhs)
Total
(` in lakhs)

Ratio
Mr. Madhusudan Gopalan

Managing Director

558.21

Ñ

Ñ

558.21

37.45
Mr. R. A. Shah
Independent Director
Ñ
12.00
3.80
15.80
1.06
Mr. B. S. Mehta
Independent Director
Ñ
12.00
3.20
15.20
1.02
Mr. A. K. Gupta
Independent Director
Ñ
12.00
5.00
17.00
1.14
Ms. Meena Ganesh
Independent Director
Ñ
3.43
0.50
3.93
0.26
Mr. Pramod Agarwal
Non-Executive Director
Ñ
12.00
2.30
14.30
0.96
Mr. Shailyamanyu Singh
Non-Executive Director
Ñ
Ñ
Ñ
Ñ
Ñ
Ms. Sonali Dhawan
Non-Executive Director
Ñ
Ñ
Ñ
Ñ
Ñ
Mr. Karthik Natarajan
Non-Executive Director
Ñ
Ñ
Ñ
Ñ
Ñ
Mr. Gagan Sawhney
Non-Executive Director
Ñ
Ñ
Ñ
Ñ
Ñ
Mr. Ghanashyam Hegde
Non-Executive Director
Ñ
Ñ
Ñ
Ñ
Ñ

ii. % increase in remuneration of Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the Financial Year
Designation
Name of Employee
% increase in remuneration
Managing Director
Mr. Madhusudan Gopalan
Not applicable as 2018-19 is his first year as Managing Director of the Company
Company Secretary
Ms. Flavia Machado
Not applicable as 2018-19 is her first year as Company Secretary of the Company
Chief Financial Officer
Mr. Prashant Bhatnagar
Nil

iii. The % increase in the median remuneration of employees in the Financial Year is 6.73%.
iv. The number of permanent employees on the rolls of Company is 380.
v. Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:
The average percentage increase made in the salaries of employees other than the managerial personnel in the Financial Year was 6.24% whereas the increase in managerial remuneration was 16.56%. The average increase every year is an outcome of companyÕs market competitiveness as against peer group companies.
It is hereby affirmed that the remuneration is as per the remuneration policy of the Company.
ANNEXURE V
Nomination & Remuneration Policy and its Framework
1. CHARTER
This charter governs the formation and operation of the Nomination and Remuneration Committee (the ÔCommitteeÕ) of Procter & Gamble Hygiene and Health Care Limited (the ÔCompanyÕ).
2. INTRODUCTION
The Company believes in conducting its affairs in     a non-discriminatory and transparent manner by adopting highest standards of professionalism and good corporate governance practices. The Company believes that a good corporate governance system  is necessary to ensure its long term success. The Company ensures good governance through the implementation of effective policies and procedures, which is mandated and regularly reviewed by the Board and / or the Committees of the members of the Board.

3. FORMATION OF COMMITTEE
The  Nomination  and  Remuneration   Committee  of the Company was constituted on August  12,  2014 consisting of 3 Directors. The Committee and Nomination and Remuneration Policy (the ÔPolicyÕ)   is in compliance with all applicable  provisions  of  the Companies Act, 2013, particularly Section 178 read together with the applicable rules thereto and Clause 49 of the Listing Agreement.

4. CONSTITUTION OF THE COMMITTEE
4.1 The  Committee  shall  consist  of  a  minimum   3 non-executive directors, majority of them being independent.
4.2 Term of the Committee shall be continued unless terminated by the Board of Directors.
4.3 Chairman of the Committee shall be an Independent Director. The Chairperson of the Company may be appointed as a  member  of the Committee but shall not be the Chairman    of the Committee.

5. QUORUM & MEETINGS
Minimum two (2) members shall constitute a quorum for a Committee meeting. In the event only two (2) members are present, the unanimous vote of the two
(2) members shall constitute an act of the Committee.
In case of an equality of votes, the Chairman shall have a second or casting vote. Where the Committee comprises of more than two (2) members, the act of a majority of the members present will constitute an act of the Committee.
The Committee shall meet at least twice in a Financial Year, with additional meetings when circumstances require, as determined by the Committee Chairman.
6. MINUTES
Minutes of each meeting will be prepared by or under the direction of the Company Secretary. The Company Secretary shall maintain a permanent record of the minutes of the meeting/s, and shall distribute minutes to members of the Committee as also directors who are not members of the Committee.
7. REPORTING AND DISCLOSURE
The Company Secretary or any other person nominated by the Board shall apprise the Board at its next meeting or earlier, if required by the law, of all material matters and recommendations proposed by the Committee from time to time.
Membership of the Committee, brief description of term of reference, programs under corporate social responsibility and attendance of the member of the Committee during the year shall  be  disclosed  in  the Annual Report.
8. SECRETARY
The Company Secretary of the Company shall act as Secretary of the Committee.
9. FUNCTIONS OF THE COMMITTEE
9.1 Corporate Governance: To ensure that the Board is comprised of directors who contribute to the successful management of the Company and discharge their duties having regard to the law and the highest standards of Corporate Governance;
9.2 Board diversity: Review the composition of the Board and devise a policy on Board diversity;
9.3 Appointment Criteria: To formulate criteria for determining qualifications, positive attributes and independence of a director and to identify persons who are qualified to become directors and who may be appointed in senior management in

accordance with the criteria laid down and recommend the Board of  their  appointment  and removal;
9.4 Appointment of Independent Directors: To formulate the criteria for evaluation of Independent Directors on the Board;
9.5 Remuneration Policy: To review and recommend to the Board the overall strategies in relation to Executive and Non-Executive remuneration policies;
9.6 Performance evaluation: To carry out evaluation of every directorÕs performance.

10. REVIEW
The Committee shall review and reassess the framework and the Policy, on an annual basis and obtain the approval of the Board of Directors, for any changes / amendment in the framework / policy.

NOMINATION AND REMUNERATION POLICY
1. PREFACE
The Nomination and Remuneration Policy (ÔPolicyÕ) for members of the Board of Directors, Key Managerial Personnel and Senior  Management  of  the  Company  is designed to attract, motivate and retain leadership members in a competitive and international market. The Policy reflects the CompanyÕs objectives for good corporate governance as well as sustained long-term value creation for shareholders.

2. POLICY IS APPLICABLE TO:


3.1 
GUIDING PRINCIPLES Ð Key Management Personnel Compensation
Our fundamental and overriding objective is to create value for our shareholders at leadership levels on a consistent long-term basis. To accomplish this goal, the global guidelines on executive compensation programs provide the following guiding principles:
1. Emphasize Pay for Performance
Aligning  incentives  with  business   strategies to reward executives who achieve or exceed Company, business unit, and individual goals, while discouraging excessive risk-taking by removing any incentive to focus on a single performance goal to the detriment of others.
2. Pay Competitively
Set target compensation opportunities to be competitive with other multinational corporations of similar size, value, and complexity.
3. Focus on Long-Term Success
Include equity as a cornerstone of our executive pay programs and by using a combination of short- term and long-term incentives to ensure a strong connection between Company performance and actual compensation realized.

3.2 GUIDING PRINCIPLES Ð Compensation to Independent Directors
1. Ensure compliance with local laws
Compensation to Independent Directors cannot exceed the threshold provided under local law as per the Companies Act.
2. Pay Competitively in line with peer companies
Target compensation to be competitive with other corporations of similar size, value, and complexity.
The Company will undertake periodic exercise to benchmark the pay-out of key peer / same sector companies.

4. REMUNERATION OF EXECUTIVE DIRECTORS, KEY MANAGERIAL PERSONNEL AND SENIOR MANAGEMENT (ÒEXECUTIVE EMPLOYEEÓ)
The Human Resources department will determine remuneration criteria and recommend the same to the Board, using the above guiding principles.

i SALARY: Each executive employee will be entitled to receive a salary which will  be  competitive and based on executiveÕs responsibilities and performance;
ii SHORT TERM INCENTIVES: Based on the achievement of an individual, pre-defined financial and strategic business targets presented by the Committee and ratified by the Board of Directors;
iii LONG TERM INCENTIVES: Each Executive Employee will be entitled to receive long term incentives, as per the global guidelines and as recommended by the Management, from time to time;
iv SEVERANCE PAY AND PENSION CONTRIBUTION:
As per employment terms;
v OTHER BENEFITS: Executive employees will be entitled to insurance policy(s), pension scheme and such other benefits as the Company may provide from time to time.

5. RATIFICATION	OF	REMUNERATION	TO	KEY MANAGEMENT PERSONNEL
The committee will bi-annually ratify the remuneration of the Key Management Personnel.

6. MAXIMUM MANAGERIAL REMUNERATION
The  total  managerial  remuneration  payable  by  the Company, to its directors, including managing director and whole-time director and non executive directors shall be within the limits as prescribed under the law.

7. REMUNERATION OF INDEPENDENT DIRECTOR
The Company will remunerate Independent Directors in a manner designed to attract and maintain high quality Board members. Independent Directors are paid remuneration by way of commission and / or sitting fees. The Company may pay a sitting fee per meeting to Independent Directors for attending Board meetings within the limits prescribed under law. Further, if the shareholders approve, commission may be paid to Independent Directors within the statutory monetary limits. Such commission is paid on a uniform basis to reinforce the principle of collective responsibility.

The remuneration of Independent Directors is consistent with and supportive of maintaining the Independent DirectorÕs independence.
8. 
POLICY AND PROCEDURE FOR SELECTION AND APPOINTMENT OF NEW DIRECTORS
(A) The selection criteria for the appointment and re- appointment of directors will normally be based on an analysis of the composition of the existing Board, its skill and experience and its independence requirements.
Factors to be considered when reviewing a potential candidate for Board appointment include without limitation:
¥ The skills, experience, expertise and personal qualities that will best complement Board effectiveness;
¥ The capability of the candidate to  devote the necessary  time  and  commitment  to  the role. This involves a consideration of matters such as other Board or executive appointments;
¥ Potential conflicts of interest, and independence in accordance with the Companies Act, 2013 and the SEBI Regulations, as specified and applicable from time to time.
(B) Each director will prior to their appointment provide to the Company  sufficient  information to allow the Board to adequately assess the independence of the director. Directors should ensure  that  updated  information  is  provided  to  the  Board   if   the   circumstances   relating to  the  assessment  of  their   independent status changes.
(C) The identification of potential directorial candidates may be assisted by the use of external search organisations as appropriate.

9. EVALUATION
9.1 Evaluation of Key Managerial Personnel
¥ The Managing Director performs the evaluation of performance on an annual basis.
¥ The Managing Director does a review of the performance based on the efforts put in by the employee, results achieved against the goals set, and impact of external / internal factors.
¥ The performance review will also include the
review of remuneration of the KMP.

ANNEXURE VI
9.2 Evaluation of Independent Directors
The performance evaluation of Independent Directors shall be done by the Board, excluding the Director being evaluated, basis the contributions made to the Board deliberations in the Board meetings.

10. REVIEW AND DISCLOSURE
10.1 The Company shall disclose in the BoardÕs report, the ratio of the remuneration of each director, to the median employeeÕs remuneration and such other details as prescribed under law.
10.2 The Company discloses in its Annual Report all elements of remuneration package of individual directors summarized under major groups details of fixed component and performance linked incentives together with material terms, service contracts like notice period, severance fees (if any) and stock option details (if any).
10.3 The Board is responsible for approving the remuneration strategy for directors, executive and senior management. In determining whether to approve the relevant level of remuneration, the Board is to consider the recommendations from the Committee, prevailing market conditions, performance by the individual and the business strategies and objectives of the Company. The Board shall disclose the remuneration of senior executives in the CompanyÕs Annual Report. The Human Resources department of the Company will monitor the day to day compliance with this Policy.
Dividend Distribution Policy
In India, regulatory framework as laid down under the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, requires the Company to put in place policy framework for distribution of dividend. Accordingly, the Board of Directors of Procter & Gamble Hygiene and Health Care Limited (Òthe CompanyÓ) have formally adopted the following written policy.
This policy documents the principles for distribution of dividends for the Equity Shareholders of the Company.
Principles for considering dividend are as follows:
The Board of Directors will consider appropriate dividend periodically in a manner in which it:
1. Rewards the Shareholders with sustainable returns;
2. Retains sufficient capital that allows the Company to exploring business opportunities.
The Board of Directors will forward the dividend recommendation for the approval of the Shareholders.
The dividend distribution shall be made in accordance with the applicable provisions of the Companies Act, 2013; Rules framed thereunder, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and other legislations governing dividends, as in force and as amended from time to time.

Periodicity:
The Company shall declare its Annual Dividend at its Annual General Meeting every year, as per recommendation by the Board of Directors. The Board may declare any interim dividend(s), based on management review during the Financial Year.

Accounting Year:
The Company shall account for dividend (including dividend distribution tax) in the year in which it is approved in the Annual General Meeting and the interim dividend in the year in which it is approved in Board meeting. This is subject to any regulatory requirements.

Disclosure:
This policy shall be disclosed on the website of the Company.
ANNEXURE VII
Secretarial Audit Report FORM NO. MR-3
SECRETARIAL AUDIT REPORT FOR THE FINANCIAL YEAR ENDED 30TH JUNE, 2019
         [Pursuant to Section 204(1) of the Companies Act, 2013 and Rule No. 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 with modifications as deemed necessary,
without changing the substance of format given in MR-3]

To,
The Members,
Procter & Gamble Hygiene and Health Care Limited
P & G Plaza, Cardinal Gracias Road, Chakala, Andheri East, Mumbai Ð 400 099
We have conducted the Secretarial Audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by Procter & Gamble Hygiene and Health Care Limited (CIN L24239MH1964PLC012971) (Company) for the financial year ended 30th June, 2019. Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts / statutory compliances and expressing our opinion thereon.
A. In expressing our opinion it must be noted that-
i. Maintenance of secretarial record is the responsibility of the management of the Company. Our responsibility is to express an opinion on these secretarial records based on our audit.
ii. We have followed the audit practices and processes as were appropriate to obtain reasonable assurances about the correctness of the contents of the secretarial records. The verification was done on test basis to ensure that correct facts are reflected in secretarial records. We believe that the processes and practices we followed provide a reasonable basis of our opinion.
iii. We have not verified the correctness and appropriateness of the financial records and books of accounts of the Company.
iv. Wherever required, we have discussed with the management of the company, relied on the legal opinion and the management representation pertaining to compliance of laws, rules and regulations, happening of events, etc.
v. The compliance with 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.
vi. The Secretarial Audit report is neither an assurance as to the future  viability  of  the  Company  nor of the efficacy or effectiveness with which the management has conducted the affairs of the Company.

B. Based on our verification of the CompanyÕs 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 30th June, 2019, complied with the statutory provisions listed hereunder and also that the Company has proper Board- process (duly evolved) and compliance-mechanism in place to the extent and as applicable to the Company in the manner and subject to the reporting made hereinafter:
C. 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 30th June, 2019 according to the provisions of:
I. The Companies Act, 2013 (the Act) and the rules made thereunder;
II. The Securities Contracts (Regulation) Act, 1956 (ÔSCRAÕ) and the rules made thereunder;
III. The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder;
IV. Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to the extent of Foreign Direct Investment only as the Company has neither made any Overseas Direct Investment nor obtained External Commercial Borrowings during the audit period.
V. A. The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (ÔSEBI ActÕ):
(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) 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.

V. B. The Company has not undertaken any of the activities during the audit period a envisaged in the following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (ÔSEBI ActÕ) and hence are not relevant for the purpose of audit:Ð
(a) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998;
(b) The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008;
(c) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009;
(d) Securities And Exchange  Board  of  India (Share Based Employee Benefits)
Regulations, 2014; and
(e) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009.
VI. The following Acts and Rules made thereunder pertaining to CompanyÕs business are applicable to the Company:
(a) Drugs and Cosmetics Act, 1940;
(b) The Legal Metrology Act, 2009 and
(c) The Legal Metrology (Packaged Commodities) Rules, 2011.
D. We have also examined compliance with the applicable clauses which, are generally adhered to, of the following:
i. Secretarial Standards in respect of Meetings of Board of Directors (SS-1) and General Meetings (SS-2) issued by The Institute of Company Secretaries of India.
ii. The Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.
During the period under review the Company has complied with the provisions of the Act, Rules, Regulations, Guidelines, Standards etc. mentioned above.
E. 
We further report that,Ð
I. The Board of Directors of the Company is duly constituted with proper balance of Executive Directors, Non-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.
II. Adequate notice is given to all directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent well in advance, and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting.
III. Majority decision is carried through and there was no instance of any director expressing any dissenting views.
F. We further report that there are adequate systems and processes in the Company commensurate with its size and operations to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.
G. We further report that during the audit period none of the following events has taken place:
I. Public / Rights / Preferential Issue of Shares / Debentures / Sweat equity etc.
II. Redemption / buy back of securities.
III. Major decisions taken by the members in pursuance to Section 180 of the Companies Act, 2013.
IV. Merger / Amalgamation / Reconstruction, etc.
V. Foreign Technical Collaborations.

For DHOLAKIA & ASSOCIATES LLP
(Company Secretaries)
                   Sd/-                                    CS Bhumitra V. Dholakia Designated Partner
FCS - 977
CP No. 507
Place : Mumbai
Date : 21st August, 2019
MANAGEMENT DISCUSSION AND ANALYSIS
Economy and markets
The Indian economy is expected to grow by 6.1% in 2019, 30 bps lower than expected at the beginning of the year. While India continues to be among the fastest-growing trillion-dollar economies in  the  world,  it  is  witnessing  a slowdown. A weak monsoon, low growth in farm income and subdued rural consumption have contributed to this slowdown. Other factors like liquidity crisis and inflationary pressure have also impacted the business environment. While the economy is growing at a slower pace than expected, projections of recovery behind newly launched government initiatives are a positive sign for the industry.
Opportunities, risk and outlook
The overall outlook for the FMCG sector remains positive. As per reports, the FMCG sector is expected to grow at mid-single digits in 2019. The rising young population, increasing affluence, rapid urbanisation and increasing digital connectivity and penetration are factors that will drive the growth of the FMCG industry. The prediction of a normal monsoon and government initiatives focused on accelerating the growth of the rural economy is expected to revive demand and boost consumption. However, amidst this, it will also be imperative for companies to  navigate through uncertainties like inflation and potential global headwinds like forex volatility and crude oil prices. Your company is well-positioned to sustain and improve its performance and leverage the available opportunities, address challenges and overcome the risks.
Performance Overview
The discussion on financial performance of the Company and its various businesses is elaborated in the DirectorsÕ Report.
Risk Management
Your Company has set up a Risk Management Committee. The Company has also adopted a Risk Management Policy. The CompanyÔs Risk Management Policy is in line with the parent CompanyÕs global guidelines and as such adequate measures have been adopted by the Company to anticipate, plan and mitigate the spectrum of risks it faces.
Business, Finance & Operational risks
On business risks (competition, consumer preferences and technology changes) the Company undertakes a Competition Response Model program. For financing risks it has a robust operational contingency and legal plan. It also undertakes Business Contingency Plan for key vendors and natural disasters. The Company also has adequate Insurance coverage to protect the value   of its assets. This coverage duly covers any risks relating to business interruption resulting from property damage and legal liability resulting from property damage or personal injury.
The Company has in place a very stringent and responsive system under which all its distributors and vendors are assessed before being selected.

Regulatory and Compliance risks
Your Company operates within the letter and spirit of all applicable laws. General compliance with legal requirements is an important component of P&GÕs Worldwide Business Conduct Manual and the same demands the following action from every employee:
¥ To obey all legal requirements at all times;

¥ To understand exactly what legal requirements apply
to the work function;

¥ To consult the legal personnel if there are conflicting
legal requirements in different jurisdictions;

¥ To strictly follow the directions from the legal personnel;

¥ To address and resolve, in a timely manner, any legal
compliance issues that have been identified;

¥ Absolutely no violation of any law; and

¥ To immediately report any instance of violations to the
Legal Department.

Your Company has set in place the requisite mechanism for meeting with the compliance requirements, periodic monitoring  of  compliance  to  avoid  any  deviations, and regular updates to keep pace with the regulatory changes.

Security Risks
Your Company has implemented comprehensive security programs supported by latest technology and trained manpower to protect employees and assets, at all its offices and plants. During the Financial Year under review, no major security breaches or incidents occurred at any of the CompanyÕs plants. A comprehensive security risk assessment is carried out regularly and adequate security measures are implemented to cater to changing security scenario. Your Company has installed the best of the security measures and processes to protect its personnel and assets.
Internal Auditor
During the Financial Year, the Board of Directors had appointed Ms. Nandini Tulsyan, Chartered Accountant  as the Internal Auditor of the Company for the Financial Year 2018-19.
Internal Controls & their adequacy
Your Company continues to prioritize sustainable control processes that are integral part of organization Culture.  It has built strong Internal Controls Environment and Risk Assessment / Management systems. These systems enable Company to comply with Internal Company policies, procedures, standard guidelines and local laws to help protect CompanyÕs assets and confidential information against financial losses and unauthorized use. The robust controls environment at your Company is efficiently managed through:
¥ Controls Self-Assessments (CSAs) are performed during October to December period of every fiscal year across business processes. The purpose of this thorough exercise is to review and evaluate process compliances against standard Control objective, activities and attributes. This enables organization to proactively identify control weaknesses and initiate actions to sustainably mitigate them.
¥ Stewardship and Global Internal Audit (GIA) Reviews led by a team of three independent fulltime Internal Controls experts, their role is to ensure that all key processes i.e. selling, revenue, distribution, trade
& marketing spends, vendor payments, and plant operations are reviewed and assessed at appropriate intervals. The observations and findings are shared with senior management for implementing quality action plans to strengthen overall controls environment in these processes. The assessments of High risks and SOX Compliance areas are assessed by an independent internal audit department lead by the CompanyÕs Global Internal Audit team. This team comprises of certified internal controls process experts and have experiences across different markets that the company operates in. The action taken by the management to correct the processes is then reviewed and reported appropriately.
¥ Governance board comprises of the Managing Director, Group Chief Financial Officer, Chief Human Resource Officer and General Counsel. The Board assess and reviews enterprise level risks and work with process owners and functional managers to ensure that corrective action is taken, and risk is mitigated as appropriate.
HR Initiatives
Your Company operates in a highly competitive environment vis-ˆ-vis attracting the best talent for its operations and therefore the human resources management function has assumed vital importance in the Company. Your Company focuses on attracting, motivating and retaining the best talent. Its people systems like talent supply, performance management and talent development are robust and competitive. We have put in place robust HR programs to ensure that the organization is geared up to deliver the future.
Attracting  &  Retaining  Talent:  India  continues  to  be a key source for Global talent and an Employer of Choice in India. Given our build from within strategy and our focus on our core campus programs coupled with our innovative programs ensures we continue to be an Employer of Choice in our Core Campuses and beyond. We are ranked in the Top 10 Employers in the Annual Nielsen Campus Survey.

Developing Talent: Our policies on leadership pipeline, talent planning, mentoring and diversity & inclusion policies continue to ensure that we attract and retain the best talent. Our New hires into the company are given a thorough on- boarding through our ÔGetIn ProgramÕ and ÔSPARK- Sales New Hire ProgramÕ to ensure that they are early contributors in their roles and feel valued. Building organization capability continues to be a key focus area for us.
Your CompanyÕs performance management system is robust and drives the employees to perform at their PEAK. It clearly assesses and differentiates employees on the basis
of performance. We have established a CARE program to build the capability of our people managers. With our focus on inclusive development, we were recognized by Working Mothers Magazine as one of the Best Companies for Women in India. We have a robust talent management process to ensure we build world class leaders. This is supported by a strong Learning & Development program, leveraging internal and external experts to ensure our people are exposed and learn from the very best. The number of employees as on June 30, 2019 was 380.

CORPORATE GOVERNANCE
Your Directors are pleased to present the Corporate Governance Report:
Corporate governance is a set of systems, principles and processes by which a company is governed. Governance process has to ensure that the Company operates in a manner that meets with the stakeholdersÕ aspirations and societal expectations. Corporate Governance consists of laws, policies, procedures, and, most importantly, practices, that ensure the wellbeing of the assets of the Company. Corporate Governance is at its highest levels when Management is acting as if they are long-term investors in the Company.
Your Company has a strong history of operating with  integrity Ð at all levels, both internally  and  externally. Our actions and the actions of all our employees are governed by our Purpose, Values and Principles (PVPs). Our commitment to operate responsibly is reflected in the steps we have in place to ensure rigorous financial discipline and Corporate Governance.
Your Company has a highly experienced Board of Directors, which helps us maintain the highest standards of Corporate Governance. Our Audit Committee is comprised of Independent Directors, with appropriate financial skills to provide good oversight. We have in place strong internal controls, to ensure compliance with all relevant regulations and standards. Our rigorous business process controls include ongoing programs of self-assessment, controls, as well as internal and external audits. Your Company has adopted a Code of Conduct for its Directors, which is derived from three interlinked fundamental principles, viz. good corporate governance, good corporate citizenship and exemplary personal conduct.
Further,  your Company  reinforces   responsibilities  on all its employees, including key employees, of observing high standards of Corporate Governance through the CompanyÕs ÒWorldwide Business Conduct ManualÓ (ÒWBCMÓ) which sets forth managementÕs commitment to conduct its business affairs with high ethical standards. This Manual flows from our PVPs which is the umbrella for our critical policy areas, which in turn create specific guidelines and standards. This Manual enables the CompanyÕs employees to make easier connection to relevant policies and the tools that support them. This Manual describes the CompanyÕs
ÒWorldwide Business Conduct StandardsÓ. These standards flow from the following core values of the Company:
¥ Treat the CompanyÕs assets as you would treat your
own;
¥ Behave with the CompanyÕs long term success in mind;
¥ Always do the right thing; and
¥ Operate within the letter and spirit of law.
The WBCM also details the policy statements, operating policies / procedures / practices and Internal Controls being followed by the Company with specific emphasis on ethical behaviour of employees, compliance with all applicable laws in letter and spirit, ensuring accuracy of books and records, maintaining confidentiality of corporate data, avoidance of conflict of interest, fair dealings, fair competition, following best practices for safety and health of Company personnel, environmental protection, trading in securities and a host of special legal issues.
Our reputation is earned by our conduct: what we say, what we do, the products we make, the services we provide, and the way we act and treat others. As conscientious citizens and employees, we want to do what is right. For your Company, this is the only way to do business.
BOARD OF DIRECTORS
(a) Composition of the Board
The Board of Directors of the Company comprises of an optimum combination of Executive and Non- Executive Directors. As on date, the Board is headed by a Non-Executive Independent Chairman, a Managing Director (Executive) and eight other Non-Executive Directors. All other Directors, except the Managing Director and the Non-Executive Independent Director, are Directors liable to retire by rotation.
The Non-Executive Independent Directors bring external perspective and independence to decision making. The terms & conditions of appointment of Independent Directors are available on the website of the Company. All Independent Directors have provided declaration of independence to the Company stating that they meet the criteria of independence as mentioned under Section 149 (6) of the Companies Act, 2013 and the Securities and Exchange Board of India  (Listing Obligations and Disclosure Requirements) Regulations, 2015 (ÒSEBI Listing Regulations, 2015Ó).
On an annual basis, the Company obtains from each Director, details of the Board and Board Committee positions he/she occupies in other Companies, and changes, if any, regarding their Directorships.
All Directors have confirmed that they are not debarred from holding the office of Director pursuant to any SEBI order or any other such
authority. The Company has obtained a certificate from Mr. B. V. Dholakia, Practicing Company Secretary, dated August 20, 2019 (annexed to this Report), confirming that none of the Directors on the Board of the  Company  have  been debarred or disqualified from holding the office of Director   by the Securities and Exchange Board of India and Ministry of Corporate Affairs or any such authority.
The composition of the Board of Directors and other Directorships held as on date are given below:

Name of the Director
Category
Designation
Directorships in other companies*
Membership of Board Committees of other companies **




Member
Chairman
Mr. Rajendra A. Shah
ID
Chairman
7
4
2
Mr. Madhusudan Gopalan#
ED
Managing Director
2
2
Nil
Mr. Bansidhar S. Mehta
ID
Director
4
4
1
Mr. Anil Kumar Gupta
ID
Director
1
2
1
Ms. Meena Ganesh@
ID
Director
15
Nil
Nil
Mr. Pramod Agarwal
NED
Director
2
0
Nil
Ms. Sonali Dhawan
NED
Director
1
1
Nil
Mr. Karthik Natarajan
NED
Director
1
Nil
Nil
Mr. Gagan Sawhney^
NED
Director
1
Nil
Nil
Mr. Ghanashyam Hegde$
NED
Director
1
Nil
Nil
NED Ð Non-Executive Director ED	Ð Executive Director
ID	Ð Independent Director
*	Includes directorships in private companies and companies registered under Section 8 of the Companies Act, 2013 and excludes directorships in foreign companies.
**	Includes memberships of only Audit Committee and StakeholdersÕ Relationship Committee of Public Companies. #	Mr. Madhusudan Gopalan was appointed as Director and Managing Director effective July 1, 2018.
@	Ms. Meena Ganesh was appointed as Non-Executive Independent Director effective March 19, 2019.
^	Mr. Gagan Sawhney was appointed as Non-Executive Director effective January 24, 2019.
$	Mr. Ghanashyam Hegde was appointed as Non-Executive Director effective May 9, 2019.
The other listed companies in which Directors on the Board of your Company are also Directors are listed below:

Name of Director
Directorships in other listed companies
Mr. Rajendra A. Shah
Non-Executive Independent Director  of:
1. Godfrey Phillips India Limited
2. Lupin Limited
3. Colgate-Palmolive (India) Limited
4. Pfizer Limited
5. BASF India Limited
6. Atul Limited
Mr. Bansidhar S. Mehta
Non-Executive Independent Director:
1. Gillette India Limited
2. Pidilite Industries Limited
3. Century Enka Limited
4. Atul Limited


Name of Director
Directorships in other listed companies
Mr. Anil Kumar Gupta
Non-Executive Independent Director:
1.	Gillette India Limited
Ms. Meena Ganesh
Non-Executive Independent Director:
1.	Pfizer Limited
Mr. Pramod Agarwal
Non-Executive Director:
1.	Gillette India Limited
Mr. Madhusudan Gopalan
Managing Director:
1.	Gillette India Limited
Mr. Karthik Natarajan
Executive Director:
1.	Gillette India Limited
Ms. Sonali Dhawan
Non-Executive Director:
1.	Gillette India Limited
Mr. Gagan Sawhney
Executive Director:
1.	Gillette India Limited
Mr. Ghanashyam Hegde
NIL
(b) Number of meetings of the Board
Four (4) meetings of the Board were held during the Financial Year July 1, 2018 to June 30, 2019. These meetings were held on August 22, 2018, November 2, 2018, February 7, 2019 and May 8, 2019.
(c) DirectorsÕ attendance record
The attendance of the Directors at the Board Meetings and at the last Annual General Meeting is as under:
@ Ms. Meena Ganesh was appointed as Non-Executive Independent Director effective March 19, 2019.
$	Mr. Gagan Sawhney was appointed as Non-Executive Director effective January 24, 2019.
^	Mr. Ghanashyam Hegde was appointed as Non-Executive Director effective May 9, 2019.
(d) Separate meeting of independent Directors
The Independent Directors of the Company met separately without the presence of Non-Independent Directors or  management  representatives  on  May 8, 2019 to review the performance of non-
Name of Director		No. of Board
meetings held during the tenure
No. of Board meetings attended
Last Annual General Meeting (Whether Attended)
independent directors; the Board & the Chairperson of the Company, and to assess the quality, quantity and timeliness of  flow  of  information  between  the Company management and the Board that is necessary for the Board to effectively and reasonably
Mr. Rajendra A. Shah	4	4	Yes
perform their duties.
Mr. Madhusudan Gopalan#
Mr. Bansidhar S. Mehta
4	4	Yes

4	4	Yes
(e) 
Related Party Transactions
The Company has adopted Related Party Transaction Policy (ÔRPT PolicyÕ) to ensure that all Related Party
Mr.  Anil Kumar Gupta	4	4	Yes
Mr. Pramod Agarwal	4	4	Yes
Transactions entered into by the Company shall  be in the best interest of the Company and in
Mr. Shailyamanyu Singh Rathore*
4	1	No
accordance with the provisions of the Companies Act, 2013 and Regulation 23 of the SEBI Listing
Ms. Sonali Dhawan	4	4	Yes
Mr. Karthik Natarajan	4	2	No
Ms. Meena Ganesh@	1	1	N.A.
Mr. Gagan Sawhney$	2	2	N.A.
Regulations, 2015. The RPT Policy is available on the CompanyÕs website at www.pg.com/en_IN/ invest/pghh/corporate_governance/policies.shtml.
Prior omnibus approval of the Audit Committee is
Mr. Ghanashyam Hegde^
NIL	N.A.	N.A.
obtained for related party transactions which are of repetitive nature. All related party transactions are
#	Mr. Madhusudan Gopalan was appointed as Director and
Managing Director effective July 1, 2018.
*	Mr. Shailyamanyu Singh Rathore resigned as Director effective May 8, 2019.
reviewed by chartered accountant firms to ensure transactions are in ordinary course of business, at armÕs length and are in compliance with the RPT
Policy of the Company. All related party transactions are placed before the Audit Committee  for  quarterly review.
There are no material pecuniary relationships / significant transactions made by the  Company  with its Promoters, Directors or management, their subsidiaries or relatives etc. which have potential conflict with the interests of the Company at large. Transactions with related parties are disclosed in Note 32 forming part of the Financial Statements.

(f) Remuneration of Directors
Members of the Company at their 54th Annual General Meeting held on November 29, 2018 had approved payment of commission to the Non-Executive Directors of the Company upto a maximum of 1% of the net profits of the Company per annum in the aggregate,
for a period of 5 years w.e.f. July 1, 2018 and had also empowered the Board of Directors to fix the quantum of commission payable to the Non-Executive Directors and to also determine the period for which said commission is payable. The Board of Directors at their meeting held on August 21, 2019 approved payment of annual commission of ` 12 lakhs, on a pro-rata basis, to Non-P&G Non-Executive Directors. The Non-Executive Directors are paid commission to compensate for their valuable contribution to the Company owing to their wealth of experience and knowledge.
No fee / compensation is payable to the Directors on severance of Directorship of the Company.
Details of the remuneration paid / provided to the Directors of the Company for the Financial Year ended June 30, 2019 are given below:

Amount in `

Name of Director
Relationship with other Directors
Salary including Bonus + PF contribution
Commission
Sitting Fees
   Shares held (Equity Shares of
` 10/- each)*
Mr. Rajendra A. Shah
None
Ñ
12,00,000
3,80,000
12,906
Mr. Madhusudan Gopalan
None
5,58,21,211$
Ñ
Ñ
Ñ
Mr. Bansidhar S. Mehta
None
Ñ
12,00,000
3,20,000
3,799
Mr. Anil Kumar Gupta
None
Ñ
12,00,000
5,00,000
Ñ
Mr. Pramod Agarwal
None
Ñ
12,00,000
2,30,000
25
Ms. Meena Ganesh
None
Ñ
3,42,740
50,000
Ñ
Mr. Shailyamanyu Singh
None
Ñ
Ñ
Ñ
Ñ
Rathore





Ms. Sonali Dhawan
None
Ñ#
Ñ
Ñ
Ñ
Mr. Karthik Natarajan
None
Ñ@
Ñ
Ñ
Ñ
Mr. Ghanashyam Hegde
None
Ñ^
Ñ
Ñ
Ñ
Mr. Gagan Sawhney
None
Ñ!
Ñ
Ñ
Ñ
* Excludes shares held by relatives.
$ Mr. Madhusudan Gopalan is paid by the Company and portion of the remuneration is cross charged to Gillette India Limited and Procter & Gamble Home Products Private Limited in proportion to their respective Net Outside Sales. Mr. Madhusudan Gopalan has exercised Stock Options of the ultimate Holding Company amounting to ` 1,19,30,799 under its Employee Stock Option Plan, which is included in the above mentioned remuneration.
# ` 141.73 Lakhs being CompanyÕs contribution to remuneration of Ms. Dhawan has been cross charged from Procter & Gamble Home Products Private Limited in terms of the common service agreement.
@ ` 5.52 Lakhs being CompanyÕs contribution to remuneration of Mr. Natarajan has been cross charged from Gillette India Limited in terms of the common service agreement.
^ ` 7.65 Lakhs being CompanyÕs contribution to remuneration of Mr. Hegde has been cross charged from Gillette India Limited in terms of the common service agreement.
! ` 30.12 Lakhs being CompanyÕs contribution to remuneration of Mr. Sawhney has been cross charged from Procter & Gamble Home Products Private Limited in terms of the common service agreement.

Stock Options
The Company does not have any Stock Option Plan for its employees. However, all employees of the Company are given the right to purchase shares   of the Ultimate Holding Company Ð The Procter & Gamble Company, USA under its ÔInternational Stock Ownership PlanÕ. Certain employees of the Company are also entitled to Stock Option of the Ultimate Holding Company under its Employee Stock Option Plan. Details as regards the same are disclosed vide Note 31 forming part of the Financial Statements.
(g) 
Committees of the Board Audit Committee
The  Audit  Committee  presently  comprises  of  Mr. Rajendra A. Shah (Chairman), Mr. Bansidhar
S. Mehta (Member), Mr. Anil Kumar Gupta (Member) and Mr. Madhusudan Gopalan (Member). During the Financial Year, the Audit Committee met on August 22, 2018, November 2, 2018, February 7, 2019 and May 8, 2019.
Attendance of the Members of the Audit Committee during the Financial Year:

Members of the Committee
Designation
Category
No. of Meetings held during tenure
No. of Meetings attended
Mr. Rajendra A. Shah
Chairman
ID
4
4
Mr. Bansidhar S. Mehta
Member
ID
4
4
Mr. Anil Kumar Gupta
Member
ID
4
4
Mr. Madhusudan Gopalan
Member
ED
4
4
ID Ð Independent Director ED Ð Executive Director
The Audit Committee plays the role as is contemplated under Section 177 of the Companies Act, 2013 read with the SEBI Listing Regulations, 2015.
The Audit Committee powers include the following:
(a) to investigate any activity within its terms of reference;
(b) to seek information from any employee;
(c) to obtain outside legal or other professional advice; and
(d) to secure attendance of outsiders with relevant expertise, if it considers necessary.
The Audit Committee role includes the following:
i. Recommendation for appointment, remuneration and terms of appointment of auditors of the Company;
ii. Review and monitor the auditorÕs independence and performance, and effectiveness of audit process;
iii. Approval or any subsequent modification of transactions of the Company with related parties;
iv. Scrutiny of inter-corporate loans and investments;
v. Valuation of undertakings or assets of the Company, wherever it is necessary;
vi. Evaluation of internal financial controls and risk management systems;
vii. 
Oversight of the CompanyÕs financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible;
viii. Approval of payment to statutory auditors for any other services rendered by the statutory auditors;
ix. Examination and reviewing, with the management, the annual financial statements and auditorÕs report thereon before submission to the board for approval, with particular reference to:
¥ Matters required to be included in the DirectorÕs Responsibility Statement to be included in the BoardÕs report in terms of clause (c) of sub-section 3 of Section 134 of the Companies Act, 2013;
¥ Changes, if any, in accounting policies
and practices and reasons for the same
¥ Major accounting entries involving estimates based on the exercise of judgment by management;
¥ Significant adjustments made in the financial statements arising out of audit findings;
¥ Compliance  with  listing  and   other legal requirements relating to financial statements;
¥ Disclosure of any related party transactions;
and
¥ Modified opinion(s) in the draft audit report
x. Reviewing, with the management, the quarterly financial statements before submission to the Board for approval;
xi. Monitoring the end use of funds raised through public offers and related matters and reviewing, with the management, the statement of uses / application of funds raised through an issue (public issue, rights issue, preferential issue, etc.), the statement of funds utilized for purposes other than those stated in the offer document / prospectus / notice and the report submitted by the monitoring agency monitoring the utilisation
Stakeholder Relationship Committee
The     Committee     presently     comprises     of Mr. Ghanashyam Hegde (Chairman), Mr. Madhusudan Gopalan (Member) and Mr. Anil Kumar Gupta (Member). Ms. Flavia Machado is the Company Secretary & Compliance Officer to the Committee. During the Financial Year, four meetings were held on August 22, 2018, November 2, 2018, February 7,
2019 and May 8, 2019.
Attendance of the Members of the Committee during the Financial Year:
of proceeds of a public or rights issue, and	 	
making appropriate recommendations to the Board to take up steps in this matter;
xii. Reviewing, with the management, performance of statutory and internal auditors, adequacy of
Members of the Committee
No. of meetings held during tenure
 
No. of meetings attended
qualifications, experience and background, etc. of the candidate; and
xiii. Reviewing the adequacy of internal audit function, if any, including the structure of
Mr. Shailyamanyu Singh	4	1
Rathore*
Mr.  Anil Kumar Gupta	4	4
Mr. Madhusudan Gopalan	4	4
the internal audit department, staffing and seniority of the official heading the department,
Mr. Ghanashyam Hegde**	Not
Applicable
  
Not Applicable
reporting structure coverage and frequency of
internal audit;
xiv. Discussion with internal auditors of any significant findings and follow up there on;
xv. Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the board;
xvi. Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as post-audit discussion to ascertain any area of concern;
xvii. To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of non-payment of declared dividends) and creditors;
xviii. To review the functioning of the Whistle Blower mechanism;
xix. Approval of appointment of CFO (i.e., the whole- time Finance Director or any other person heading the finance function or discharging that function) after assessing the qualifications, experience and background, etc. of the candidate;
xx. Reviewing any other areas which may be specified as role of the Audit Committee under the SEBI Listing Regulations, 2015, Companies Act and other statutes, as amended from time to time.
The minutes of the Audit Committee are placed before the Board.


* Mr. Shailyamanyu Singh Rathore resigned as Director of the Company effective May 8, 2019 and consequently ceased to be Member and Chairman of the Stakeholder Relationship Committee effective May 8, 2019.
** Mr. Ghanashyam Hegde was inducted as a Member and Chairman of the Stakeholder Relationship Committee effective May 9, 2019.
The role of the Committee is as follows:
¥ Resolving the grievances of the security holders of the Company including complaints related to transfer / transmission of shares, non-receipt of annual report, non-receipt of declared dividends, issue of new / duplicate certificates, general meetings etc;
¥ Review of measures taken for effective exercise
of voting rights by shareholders;
¥ Review of adherence to the service standards adopted by the Company in respect of various services being rendered by the Registrar & Share Transfer Agent; and
¥ Review of the various measures and initiatives taken by the Company for reducing the quantum of unclaimed dividends and ensuring timely receipt of dividend warrants / annual reports / statutory notices by the shareholders of the Company.
During the Financial Year, the Company received
8 complaints from Shareholders. These complaints have been resolved during the Financial Year.

Nomination and Remuneration Committee
The Nomination and Remuneration Committee presently comprises of Mr. Anil Kumar Gupta (Chairman),  Mr. Rajendra  A.  Shah   (Member) Mr. Ghanashyam Hegde (Member), and Mr. Gagan Sawhney (Member). During the Financial Year, four meetings were held on August 22, 2018, November 2, 2018, February 7, 2019 and May 8, 2019.
Attendance of the Members of the Committee during the Financial Year:
The Company has adopted Nomination and Remuneration Policy. The Nomination and Remuneration Policy is in compliance with all applicable provisions of the Companies Act, 2013, particularly Section 178 read together with the applicable rules thereto and Regulation 19 of the SEBI Listing Regulations, 2015. The Policy is designed to attract, motivate and retain leadership members in a competitive and international market. The Policy reflects the CompanyÕs objectives for good corporate governance as well as sustained long-term value
Members of the Committee
No. of meetings held during tenure
 
No. of meetings attended
creation for shareholders. The Policy is available on the website of the Company at http://www.pg.com/ en_IN/invest/pghh/corporate_governance/policies.
shtml. This Policy is also annexed to the DirectorsÕ
Mr.  Anil Kumar Gupta	4	4
Mr. Rajendra A. Shah	4	4
Mr. Karthik Natarajan*	4	2
Report as Annexure V.
The Company has also adopted a Board Diversity Policy
Mr. Ghanashyam Hegde**
Not Applicable Not Applicable
which is based on the principle that the CompanyÕs Board of Directors should have a balance of skills,
Mr. Gagan Sawhney** Not Applicable Not Applicable

* Mr. Karthik Natarajan ceased to be Member of the Nomination & Remuneration Committee effective August 21,2019.
** Mr. Ghanashyam Hegde and Mr. Gagan Sawhney were inducted as Members of the Nomination & Remuneration Committee effective August 21, 2019.
The role of the Committee is as follows:
¥ Formulation of criteria for determining qualifications, positive attributes and independence of Directors;
¥ Formulation of evaluation criteria for performance evaluation of Independent Directors and the Board;
¥ Recommendation to the Board of a Policy, relating to the remuneration of Directors, key managerial personnel and senior management;
¥ Identification of persons who are qualified to become directors and who may be appointed in senior management and recommendation to the Board their appointment and removal;
¥ Carrying out evaluation of every DirectorÕs
performance;
¥ Devise a policy on Board diversity;
¥ Any other role & responsibility, as may be mandated by any statutory legislation, from time to time.
experience and diversity of perspectives appropriate to the CompanyÕs business. The Company recognizes that a Board composed of appropriately qualified people with a broad spectrum of experience relevant to the business is important for effective corporate governance and sustained commercial success of the Company. The Company aims to achieve a sustainable and balanced development by building a diverse and inclusive culture.
The Committee carries out an evaluation of the performance of individual Directors. Feedback was sought by way of structured questionnaires covering various aspects in line with the Guidance Note on Board evaluation issued by the Securities and Exchange Board of India vide its circular dated January 5, 2017 and performance evaluation was carried out based on the responses received from the Directors.

Corporate Social Responsibility Committee
The Corporate Social Responsibility Committee presently comprises of Mr. Anil Kumar Gupta (Chairman), Mr. Madhusudan Gopalan (Member), Ms. Sonali Dhawan (Member) and Mr. Karthik Natarajan (Member). During the Financial  Year,  two meetings were held on August 22, 2018 and February 7, 2019.
Attendance of the Members of the Committee during the Financial Year:
Risk Management Committee
The Company has constituted a Risk Management
Members of the Committee
   
No. of meetings held
 
No. of meetings
Committee to monitor and the review the Risk Management Policy and plans of the Company. The
 	during tenure attended   
Mr. Anil Kumar Gupta
2
2
Ms. Sonali Dhawan
2
2
Mr. Madhusudan Gopalan
2
2
  Mr. Karthik Natarajan	2	2          
The role of the Committee is as follows:
¥ Formulation and recommendation to the Board, a CSR Policy which shall indicate the activities to be undertaken by the Company;
¥ Recommendation of the amount of expenditure
to be incurred on the CSR activities;
¥ Monitoring the CSR Policy of the Company
from time to time;
¥ Formulation and monitoring of implementation
Committee presently comprises of Mr. Madhusudan Gopalan (Chairman), Mr. Karthik Natarajan  (Member),   Mr.   Anil   Kumar    Gupta    (Member), Mr. Pramod Agarwal (Member), Mr. Ghanashyam Hegde (Member), Mr. Prashant Bhatnagar (Member) Mr. Gagan Sawhney (Member), and Ms. Meena Ganesh (Member). During the Financial Year, two meetings were held on August 22, 2018 and May 8, 2019.
The role of the Committee is as follows:
¥ To monitor and review the Risk Management
policy and plans of the Company
¥ To monitor and review cyber security risk.
Attendance of the Members of the Committee during the Financial Year:
of business responsibility policies; and
¥ Annual assessment of the business responsibility
performance and reporting.
Members of the Committee
   
No. of meetings held during tenure
 
No. of meetings attended
The Company has adopted a Corporate Social Responsibility Policy (ÔCSR PolicyÕ). In line with the global principles followed by the Procter & Gamble group and terms of the Companies Act, 2013, the CSR policy is broadly framed taking into account the following:
¥ We believe itÕs essential to run our business responsibly, and our operating practices reflect this commitment.
¥ We are focused on making every day better for people and the planet through our innovations and our actions:
i. Environment by Ð Conservation of Resources, Using Renewable Resources, Generating Worth from Waste;
ii. Social by Ð providing the comforts of home, improving health and hygiene of people, social and cultural development, imparting education, training and social awareness.
Mr. Madhusudan Gopalan	2	2
Mr. Karthik Natarajan	2	1
Mr.  Anil Kumar Gupta	2	2
Mr. Pramod Agarwal	2	2
Mr. Shailyamanyu Singh Rathore*	2	1
Mr. Prashant Bhatnagar	2	2
Mr. Gagan Sawhney	2	2
Mr. Ghanashyam Hegde**	Not Applicable Not Applicable Ms. Meena Ganesh**	Not Applicable Not Applicable
* Mr. Shailyamanyu Singh Rathore resigned as Director of the Company effective May 8, 2019 and consequently ceased to be Member of the Risk Management Committee.
** Mr. Ghanashyam Hegde and Ms. Meena Ganesh were inducted as Members of the Risk Management Committee effective May 9, 2019 and August 21, 2019 respectively.
The Company has adopted a Risk Management Policy, which aims to create a standard, structured and efficient approach to identify, assess and mitigate risks. Our Company meetings are structured to plan, assess and mitigate risks. These include annual & monthly business planning meetings as well as specific category and go-to-market assessments.

Cash & Investment Committee
The Company has constituted a Cash & Investment Committee, presently comprising of Mr. Pramod Agarwal (Chairman), Mr. Anil Kumar Gupta (Member), Mr. Karthik Natarajan (Member), Mr. Gagan Sawhney (Member) and Mr. Ghanashyam Hegde (Member). During the Financial Year, two meetings were held on November 2, 2018 and February 7, 2019.
Attendance of the Members of the Committee during the Financial Year:

Members of the Committee
No. of meetings held during tenure
 No. of meetings attended
Mr. Pramod Agarwal
2
2
Mr. Anil Kumar Gupta
2
2
Mr. Shailyamanyu Singh Rathore*
2
0
Mr. Karthik Natarajan
2
1
Mr. Gagan Sawhney**
Not Applicable
Not Applicable
Mr. Ghanashyam Hegde** Not Applicable Not Applicable  
* Mr. Shailyamanyu Singh Rathore resigned as Director of the Company effective May 8, 2019 and consequently ceased to be Member of the Cash & Investment Committee.
** Mr. Gagan Sawhney and Mr. Ghanashyam Hegde were inducted as Members of the Cash & Investment Committee effective August 21, 2019.
The role of the Committee is as follows:
Assessment and recommendation to the  Board  the best possible  utilization  of  cash  generated  by the Company, on basis of following primary considerationsÐ
i) protecting long term growth of the Company;
ii) maximizing return to the Shareholders; and
iii) ensuring risk free investments choices.

(h) Familiarization programme for Independent Directors
The familiarization programme aims at familiarizing the Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates and business model of the Company.
Your Company conducts presentations at meetings of the Board and meeting of various Committees of the Board periodically to familiarize the Independent
Directors with the business performance, business strategy, operations and functions of the Company. Such presentations help the Independent Directors to understand the CompanyÕs strategy, business model, operations, market, competition, organization structure, risk analysis and such other areas.
The Company updates the Independent Directors on changes in relevant laws / regulations from time to time. Each member of the Board, including the Independent Directors, are given any information relating to the Company, whenever they so request. Independent Directors have the freedom to interact with the CompanyÕs management.
In case of appointment of new Independent Director on the Board of the Company, the Company would:
¥ Issue a formal letter of appointment at the time
of appointment; and
¥ Provide introductory documents including Annual Report, Board committee framework, codes of conducts, as may be applicable to the Director, various Policies and procedures adopted by the Company.
During the Financial Year, a familiarization programme was conducted at the registered office of the Company for induction of newly appointed Independent Director, Ms. Meena Ganesh on May 9, 2019 from 8.30 am to 1.00 pm covering various topics including introduction to P&G  group  and  the Company, historical background, organization structure & review, Company growth strategy, feminine care and healthcare business on boarding, and digital road map review. Ms. Meena Ganesh, Mr. Anil Kumar Gupta, Mr. Madhusudan Gopalan, Ms. Sonali  Dhawan,  Mr.  Gagan  Sawhney  and  Mr. Ghanashyam Hegde attended the said programme.
The familiarization programme is available on the CompanyÕs website at http://www.pg.com/en_IN/ invest/pghh/corporate_governance/index.shtml.
(i)	Key Board qualifications, expertise and attributes
The CompanyÕs core business includes manufacturing and selling of branded packaged fast moving consumer goods in the feminine care and healthcare businesses.
The list of core skills/expertise/competencies identified by the Board of Directors as required in the context of the CompanyÕs aforesaid business for efficient functioning of the Board are as follows:

Finance & Accounting Expertise
Experience of financial management with appropriate professional qualifications (e.g. MBA in Finance, Chartered Accountants, Cost Accountants, Chartered Financial Analyst etc.)
Legal Expertise
Experience in the field of law, litigations or advisory with appropriate professional qualifications (e.g. Lawyers, Solicitors, Company Secretaries)
Strategy / Business Operation Expertise
Experience of leading the companies as CEO or part of Senior management or as Functional leader with strategic or business operations expertise

Experience in digital, technology driven businesses
FMCG
Domain Expertise
Experience of FMCG industry
Regulatory / Policy
Experience of regulatory advisory, policy formulation & implementation, public administrative experience
(j) Annual Evaluation of the Directors
The Board has carried out an annual evaluation of its own performance and that of its Committees as well as performance of the Directors individually. Feedback was sought by way of structured questionnaires covering various aspects in line with the Guidance Note on Board evaluation issued by the Securities and Exchange Board of India vide its circular dated January 5, 2017 and performance evaluation was carried out based on the responses received from the Directors.
(k) Disclosures regarding appointment and re-appointment of Directors
1. Mr. Karthik Natarajan
Mr. Natarajan is a Chartered Accountant and has completed his Bachelor of Commerce from
R. A. Podar College, Mumbai. Mr. Natarajan has been with P&G for over 19 years and is currently the Vice President, Finance & Accounting, Asia Pacific, Middle East & Africa. He has, over his experience at P&G, worked across multiple locations including India, US, China, Philippines, Singapore and Dubai.
Mr. Natarajan, Director retires by rotation and being eligible, offers himself for re-appointment at the ensuing 55th Annual General Meeting.
2. 
Mr. Pramod Agarwal
Mr. Agarwal is an MBA from Indian Institute of Management, Ahmedabad. After over 28 years of experience with P&G, he retired in 2016.  He has worked in seven geographies Ð India, Thailand, Japan, Philippines, USA, Singapore and Switzerland. Mr. Agarwal has led several major changes which have had a lasting impact on the business and organization.
Mr. Agarwal, Director retires by rotation and being eligible, offers himself for re-appointment at the ensuing 55th Annual General Meeting.
3. Mr. Rajendra A. Shah
Mr. Shah is a leading solicitor and a senior partner of Crawford Bayley & Co., a firm of solicitors and advocates. He specializes in broad spectrum of corporate laws. He has been a Director on the Boards of several prominent companies in India.
Owing to personal reasons, Mr. Shah has offered himself for re-appointment for a period of one year only. Accordingly, it is proposed to re-appoint Mr. Shah as Independent Director of the Company for a period of one year effective September 24, 2019, at the ensuing 55th Annual General Meeting.
4. Mr. Bansidhar S. Mehta
Mr. Mehta is a graduate in commerce and a Fellow Member of The Institute of Chartered Accountants of India. He is a Chartered Accountant in practice dealing with taxation, accountancy and valuation of mergers and acquisitions. He has been a Director on the Boards of several prominent companies in India.
Owing to personal reasons, Mr. Mehta has offered himself for re-appointment for a period of one year only. Accordingly, it is proposed to re-appoint Mr. Mehta as Independent Director of the Company for a period of one year effective September 24, 2019, at the ensuing 55th Annual General Meeting.
5. Mr. Anil Kumar Gupta
Mr. Gupta is an engineer from IIT New Delhi. He also holds a PG Diploma in Industrial Management from Jamnalal Bajaj Institute of Management Studies, Mumbai. He has a vast experience of over 40 years in India and abroad in the field of Manufacturing, Projects and Supply Chain Management.

It is proposed to re-appoint Mr. Gupta, as Independent Director of the Company for a period of five years effective September 24, 2019, at the ensuing 55th Annual General Meeting.

6. Mr. Ghanashyam Hegde
Mr. Hegde is a legal professional with over
18 years of experience across pharma, media & entertainment, financial services and chemical industries. He is an alumnus  of Bangalore University and National Law School of India University and holds a degree in law and  Post Graduate Diploma in Intellectual Property Rights. He is also a qualified Company Secretary. He joined P&G in September 2018 as General Counsel for Indian Sub-continent. He is Company Secretary of P&G Group Company, Gillette India Limited.
It is proposed to appoint Mr. Hegde, as Non-Executive Director of the Company at the ensuing 55th Annual General Meeting.

7. Ms. Meena Ganesh
Ms. Meena Ganesh is one of IndiaÕs foremost business leaders with nearly three decades of experience in industries including healthcare, consulting, technology, outsourcing, education and e-commerce. Ms. Meena Ganesh is the Managing Director & CEO of Portea Medical, which she co-founded in July 2013. Ms. Meena Ganesh is a PGDM holder from Indian Institute of Management Ð Calcutta and has a graduate degree in Physics from the Madras University. She has been named by Fortune India as one of the 50 ÔMost Powerful Women in BusinessÕ for five consecutive years (2015 - 2019). She won the ET Startup Award in the ÔWomen AheadÕ category in 2016.
It is proposed to appoint Ms. Meena Ganesh, as an Independent Director of the Company for a period of five years effective March 19, 2019, at the ensuing 55th Annual General Meeting.
COMMUNICATION TO SHAREHOLDERS
(i) The quarterly results of the Company are announced within 45 days of completion of the quarter or within the time as prescribed by the Securities & Exchange Board of India. Audited Annual Results are announced within 60 days of the end of Financial Year or within the time as prescribed by the Securities & Exchange Board of India which are published in the The Economic Times, Mumbai Lakshadeep and The Asian Age.
(ii) The CompanyÕs results and official news releases are published on CompanyÕs website: www.pg.com/en_IN.
(iii) During the course of the Financial Year, two Investor meetings were held on March 13, 2019. Details of the meetings and presentation are uploaded on the website of the Company- https://www.pg.com/en_ IN/invest/pghh/invester_information /investor_analyst/ index.shtml.
(iv) This  Annual  Report  along  with  Notice   calling the Annual General Meeting  for  the  Financial  Year 2018-19, in electronic form, is being sent to the Members at the email address provided / updated by the Members with the Depository Participants / Registrar & Transfer Agent, as applicable. Physical copy of the Annual Report is being sent to the members whose e-mail address is not registered with the Company and members who have lodged their request with the Company for a physical copy of Annual Report.

STATUTORY COMPLIANCE
The Company has complied with all applicable requirements prescribed by the regulatory and statutory authorities including Stock Exchanges and SEBI on all matters related to capital markets and no strictures or penalty was imposed on the Company in past three years.

GENERAL MEETINGS
POSTAL BALLOT
During the Financial Year, following resolutions were approved by Postal Ballot mechanism:
1. Resolution   for   approval   of   appointment   of  Mr. Madhusudan Gopalan as Director and Managing Director of the Company was passed by the Shareholders of the Company through Postal Ballot on August 8, 2018.  The  Board  had  appointed  Mr. B. V. Dholakia, Practicing Company Secretary, as the scrutinizer to conduct the Postal Ballot process in a fair and transparent manner. The results of the postal ballot were declared on August 9, 2018. Details of the voting pattern were as under:
Description of Resolution: Approval of appointment of Mr. Madhusudan Gopalan as Director and Managing Director of the Company for a period of five years with effect from July 1, 2018 (Ordinary Resolution).
Particulars
No. of Votes
   (Physical ballots and e-voting)
Votes Cast
(No. of Shares)
 % of Votes
No. of total valid Postal Ballot Forms / e-votes received
550
2,62,57,987
100.00
Assented to the resolution
527
2,62,34,680
99.91
Dissented to the resolution
23
23,307
0.09
Accordingly, the said Resolution was approved by the Shareholders of the Company, with requisite majority.
2. Resolution for continuation of present tenure of directorship of Mr. R. A. Shah and B. S. Mehta who are above 75 years of age, as Non-Executive Independent Directors and Appointment of Mr. Gagan Sawhney, as Non-Executive Director, were passed by the Shareholders of the Company through Postal Ballot on January 24, 2019. The Board had appointed Mr.
a. 
Description of Resolution: Continuation of present tenure of directorship of Mr. Rajendra
A. Shah, who is above 75 years of age, as a Non-Executive Independent Director (Special Resolution).

Particulars
No. of Votes
   (Physical ballots and e-voting)
Votes Cast
(No. of Shares)
 % of Votes
No. of total valid Postal Ballot Forms/ e-votes received
322
2,55,23,707
100.00
Assented to the resolution
197
2,40,77,998
94.34
Dissented to the resolution
125
14,45,709
5.66
Accordingly, the said Resolution was approved by the Shareholders of the Company, with requisite majority.
b. Description of Resolution: Continuation of present tenure of directorship of Mr. Bansidhar
S. Mehta, who is above 75 years of age, as    a Non-Executive Independent Director (Special Resolution).

Particulars
No. of Votes
   (Physical ballots and e-voting)
Votes Cast
(No. of Shares)
 % of Votes
No. of total valid Postal Ballot Forms/ e-votes received
325
2,65,28,280
100.00
Assented to the resolution
228
2,54,16,600
95.81
Dissented to the resolution
97
11,11,680
4.19
Accordingly, the said Resolution was approved
B. V. Dholakia, Practicing Company Secretary, as the scrutinizer to conduct the Postal Ballot process in a fair and transparent manner. The results of the postal ballot were declared on January 25, 2019. Details of the voting pattern were as under:
by the Shareholders of the Company, with requisite majority.

c. Description of Resolution: Appointment of Mr. Gagan Sawhney as Non-Executive Director of the Company (Ordinary Resolution).

Particulars
No. of Votes
   (Physical ballots and e-voting)
Votes Cast
(No. of Shares)
 % of Valid Votes
No. of total valid Postal Ballot Forms/ e-votes received
323
2,65,28,203
100.00
Assented to the resolution
301
2,64,29,361
99.63
Dissented to the resolution
22
98,842
0.37
Accordingly, the said Resolution was approved by the Shareholders of the Company, with requisite majority.

Procedure for Postal Ballot:
In compliance with Sections 108, 110 and other applicable provisions of the Companies Act, 2013 read with the Rules issued thereunder, the Company provided electronic voting (e-voting) facility to all its Shareholders. The Company engaged the services of National Securities Depository Limited (ÒNSDLÓ) for the purpose of providing e-voting facility to all its members. The Shareholders had an option to vote either by postal ballot or through e-voting. The Company dispatched the postal ballot notices and forms along with postage prepaid business reply envelopes to its Shareholders whose names appeared on the Register of Members/list of beneficiaries as on cut-off date. The postal ballot notice was sent to Shareholders in electronic form to the email addresses registered with the depository participants/CompanyÕs Registrar & Share Transfer Agents. The Company also published a notice in the newspapers declaring the details of completion of dispatch and other requirements under the Secretarial Standards issued by the Institute of Company Secretaries of India, the Companies Act, 2013 and the Rules issued thereunder. Voting rights were reckoned on the paid up value of shares of the Company registered in the names of the Shareholders  as on the cut-off date. Shareholders desiring to vote through postal ballot were requested to return the forms, duly completed and signed so as to reach the Scrutinizer before the close of the voting period. Members desiring to exercise their votes by electronic mode were requested to vote before the close of business hours on the last date of e-voting. The Scrutinizer submitted his report to the Chairman, after the completion of scrutiny and the consolidated results of the voting by postal ballot were then announced by the Company. The results are displayed on the website of the Company at https://www.pg.com/en_ IN/invest/pghh/invester_information/postal_ballot.shtml, besides being communicated to the Stock Exchanges.
No special resolution is proposed to be conducted through Postal Ballot as on the date of this Report.

MD / CFO Certification
A compliance certificate in accordance with Regulation 17(8) of the SEBI Listing Regulations, 2015 was provided to the Board of Directors in the prescribed format for the Financial Year 2018-19, which was reviewed by the Audit Committee and taken on record by the Board.

ADOPTION OF DISCRETIONARY REQUIREMENTS
The Company has adopted following discretionary requirements of Regulation 27(1) of the SEBI Listing Regulations, 2015:
a. There are no audit qualifications in the CompanyÕs financial statements for the Financial Year 2018-19.
b. The Company has appointed separate persons as Chairman and Managing Director of the Company.

WHISTLE BLOWER POLICY
The Company being a part of the Procter & Gamble group is guided by a Whistle Blower Policy as laid down in its ÒWorldwide Business Conduct ManualÓ. Any employee or other interested person can call on ÔThe Worldwide  Business Conduct Helpline (previously called the Alertline)Õ, twenty-four hours a day, seven days a week, to report any concerns about violations of the CompanyÕs ÒWorldwide Business Conduct StandardsÓ.
The Worldwide Business Conduct Helpline is not staffed or monitored by the Company personnel. All calls can be completed anonymous if the caller desires. The Helpline can take calls in most languages spoken by employees around the world.
Calls made to the Helpline are reported to the CompanyÕs Corporate Security and Legal personnel, who will ensure appropriate investigation and follow-up of all calls. Callers are given a confidential identification number so they can inquire about the status of their reported concerns.
The ÔWorldwide Business Conduct HelplineÕ is accessible to all employees.
In compliance with the requirement under the SEBI Listing Regulations, 2015 and Section 177 of the Companies Act, 2013 and the Rules made thereunder, the Company has adopted the whistle blowing policy as the vigilance mechanism for Directors and employees to report genuine concerns or grievances such as unethical behaviour, actual or suspected fraud or violation of the CompanyÕs code of conduct or ethics policy.
The Audit Committee oversees the vigil mechanism and number of cases reported alongwith the status report and action taken (if any) are reported to the Committee. No personnel has been denied access to the Audit Committee.
The Vigil Mechanism is available on the CompanyÕs website at http://www.pg.com/en_IN/invest/pghh/ corporate_governance/policies.shtml.

CODE OF CONDUCT
(i) Code of Conduct for Directors
The Company has in place a Code of Conduct for its Directors and senior management. This Code is derived from three interlinked fundamental principles, viz. good corporate governance, good corporate citizenship and exemplary personal conduct. The Board Members and Senior Management Personnel have affirmed their compliance with the Code of Conduct and a Managing Director certificate to that effect is annexed to this Corporate Governance Report. The Code of Conduct has been posted on the CompanyÕs website at http://www.pg.com/en_IN/invest/pghh/ corporate_governance/code_of_conduct.shtml.
(ii) Code of Conduct for Prohibition of insider Trading
The Board of the Company has adopted the Code of Conduct for prevention of Insider Trading SEBI (Prohibition of Insider Trading) Regulations, 2015. The code has been posted on the CompanyÕs website at http://www.pg.com/en_IN/invest/pghh/corporate_ governance/code_of_conduct.shtml.

GENERAL SHAREHOLDER INFORMATION
i. Annual General Meeting
The 55th Annual General Meeting will be held on Wednesday, November 27, 2019 at 11.00 a.m. at
Y. B. Chavan Pratisthan, Gen. Jagannathrao Bhonsle Marg, Mumbai - 400 021.
ii. Financial Calendar
Presently, the Company follows July-June Financial Year. The Financial Results are declared within timelines as prescribed by the Securities & Exchange Board of India.
iii. 
Book Closure Dates: Thursday, November 21, 2019, to Wednesday, November 27, 2019 (both days inclusive).
The said book closure is for payment of dividend.
iv. Dividend Payment Date: On or before December 20, 2019.
v. Total fees paid to Statutory Auditors of the Company: Total fees of ` 111.90 lakhs for Financial Year 2018-19, was paid by the Company to Kalyaniwalla & Mistry LLP, Statutory Auditors of the Company.
vi. Disclosure relating to Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
The Company has in place an effective mechanism for dealing with complaints relating to sexual harassment at workplace. The details relating to the number of complaints received and disposed of during the Financial Year 2018-19 are as under:
a. Number of complaints filed during the Financial Year: 1
b. Number of complaints disposed of during the Financial Year: 1
c. Number of complaints pending as on end of the Financial year: NIL
vii. Recommendations of Committees of the Board
There were no instances during the Financial Year 2018-19, wherein the Board had not accepted recommendations made by any Committee of the Board.
viii. Listing of Equity Shares on Stock Exchanges
The CompanyÕs shares are listed on the BSE Limited and the National Stock Exchange of India Limited. Listing fees as prescribed have been paid to the respective Stock Exchanges.
ix. Stock Code
BSE Limited : 500459
National Stock Exchange of India Ltd. : PGHH
Dematerialization ISIN Code : INE179A01014

x. Stock Price Data

Month
BSE
NSE

High
Low
High
Low
July Ð 2018
11,000.00
9,795.25
11,337.00
9,800.00
August Ð 2018
10,959.85
9,450.00
10,979.60
9,576.15
September Ð 2018
10,400.00
9,216.80
10,395.00
9,300.00
October Ð 2018
9,856.00
8,714.00
9,792.95
8,801.75
November Ð 2018
9,935.70
9,231.95
9,974.55
9,221.00
December Ð 2018
9,975.00
9,409.40
10,000.00
9,390.00
January Ð 2019
10,170.95
9,746.45
10,250.00
9,711.35
February Ð 2019
10,850.00
9,600.00
10,998.70
9,750.00
March Ð 2019
11,190.00
10,136.50
11,245.00
10,150.00
April Ð 2019
10,952.90
10,000.00
10,980.00
9,950.00
May Ð 2019
11,065.45
10,150.00
11,190.00
10,136.00
June Ð 2019
11,150.00
10,350.05
11,198.00
10,421.00
(Source: www.bseindia.com & www.nseindia.com)
Note: High and low are in Rupees (`) per traded share
xi. Stock Performance in comparison to the BSE Sensex and NSE Nifty
The following chart shows the performance of the CompanyÕs shares as compared to the BSE Sensex during the Financial Year 2018-19:


(Source: www.bseindia.com)
The following chart shows the performance of the CompanyÕs shares as compared to the NSE Nifty during the Financial Year 2018-19:

(Source: www.nseindia.com)
xii. 
Distribution of shareholding by ownership as on June 30, 2019

Category
 Number of shares held
% of shares
held
Foreign & Indian promoters
2,29,29,773
70.64
Resident Individuals and others
38,04,348
11.72
Mutual Funds
15,66,126
4.82
Financial Institutions / Banks
12,06,771
3.72
Insurance Companies
8,23,083
2.54
Alternate Investment Fund
16,751
0.05
Foreign Portfolio Investors
10,97,894
3.38
Private Corporate Bodies
8,34,131
2.57
NRIs & Foreign Nationals
1,64,764
0.51
Directors and their relatives
17,095
0.05
TOTAL
3,24,60,736
100.00

xiii. Registrar & Transfer Agents
Link Intime India Private Limited C-101, 247 Park, LBS Marg,
Vikhroli (West), Mumbai - 400 083
Tel: (022) 4918 6279, Fax: (022) 4918 6060
E-mail: rnt.helpdesk@linkintime.co.in

xiv. Share Transfer and Demat system
As per SEBI directions, except in case of transmission or transposition of securities, requests for effecting transfer of securities shall not be processed unless the securities are held in dematerialized form effective April 01, 2019. The transfer deed(s) lodged prior to deadline, i.e., April 1, 2019, and returned due to deficiency in the document may be re-lodged for transfer with Link Intime India Private Limited (Registrar & Transfer Agents), even after the deadline of April 01, 2019.
Transfer of shares is effected by the Registrar & Transfer Agents and share certificates are dispatched within a period of 15 days from the date of receipt of relevant documents, provided they are complete in all respects.
All requests for dematerialization of shares are processed and the confirmation is given to the respective depositories i.e. National Securities Depository Limited (NSDL) and Central Depository Services Limited (CDSL) within 15 days.
xv. Distribution of shareholding by size class as on June 30, 2019


Shareholders
Shares
Share holding
Number
% to Total
Number
% to Total
Upto 500
31,761
95.07
17,08,623
5.26
501 Ð 1000
889
2.66
6,23,967
1.92
1001 Ð 2000
422
1.26
5,89,508
1.81
2001 Ð 3000
104
0.31
2,53,226
0.78
3001 Ð 4000
60
0.18
2,11,906
0.65
4001 Ð 5000
26
0.08
1,17,026
0.38
5001 Ð 10000
57
0.17
3,83,529
1.18
10001 and above
88
0.27
2,85,72,951
88.02
TOTAL
33,407
100.00
3,24,60,736
100.00

xvi. Dematerialization of shares and liquidity
The CompanyÕs shares are required to be compulsorily traded in the stock exchanges in dematerialized form. As on June 30, 2019, the number of shares in dematerialized and physical mode are as under:

Particulars
No. of shares
%  to total
capital issued
Held in dematerialized form in NSDL
3,13,19,983
96.49
Held in dematerialized form in CDSL
8,73,086
2.69
Held in Physical form
2,67,667
0.82
Total
3,24,60,736
100.00
Shares held in demat / physical form as  on June 30, 2019
xviii. 
Unclaimed / Unpaid Dividends
In accordance with the provisions of Sections 124 and 125 of Companies Act, 2013 and Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016 (IEPF Rules) dividends not encashed / claimed within seven years from the date of declaration are to be transferred to the Investor Education and Protection Fund (IEPF) Authority. The IEPF Rules mandate companies to transfer shares of Members whose dividends remain unpaid / unclaimed for a continuous period of seven years to the demat account of IEPF Authority. The Members whose dividend / shares are transferred to the IEPF Authority can claim their shares / dividend from the Authority.
Final dividend for the Financial Year ended June 30, 2012 and for the subsequent years, which remain unpaid or unclaimed, will be due  for  transfer  to the IEPF of the Central Government on the dates mentioned in the table below. Members who have not encashed their dividend warrants for these years are requested to seek issue of duplicate warrants on or before the due dates mentioned therein, by writing to the CompanyÕs RTA M/s. Link Intime India Private Limited.








xvii. As on date, the Company has not issued GDR / ADR / warrants or any convertible instruments.

During the Financial Year 2018-19, unclaimed dividend amount for the Financial Year ended June 30, 2011 amounting to ` 36,05,310 and 15,602 shares were transferred to the IEPF.
The details of unpaid / unclaimed dividend as on date of previous Annual General Meeting, i.e., November 29, 2018 have been posted on the website of the Company, viz., www.pg.com/en_IN.

xix. Disclosure in respect of equity shares transferred to the ÔProcter & Gamble Hygiene and Health Care Limited Ð Unclaimed Suspense AccountÕ is as under:
In accordance with the requirements of Regulation 34, 39 read with Schedule V(F) of the SEBI Listing Regulations, 2015 details of equity shares lying in Unclaimed Suspense Account are as follows:


Particulars
No. of shareholders
No. of Equity Shares
Opening Balance
Aggregate number of shareholders and the outstanding shares in the Unclaimed Suspense Account lying as on July 1, 2018
298
38,657
Less
Number of shareholders who approached the Company for transfer of shares and shares transferred from suspense account during the year
3
587
Closing Balance
Aggregate number of shareholders and outstanding shares lying in the suspense account as on June 30, 2019
295
38,070
The voting rights on shares lying in unclaimed suspense account shall remain frozen till the rightful owner claims the shares.
xx. Plant location
Goa:
(1) 173, 314, 315, Kundaim Industrial Estate, Kundaim, Goa - 403 115
Baddi:
(1) Khasara. No. 1808-09, Village-Doria, Export Park, Thana, Near Indo Farm, PO. Baddi, Tehsil: Nalagarh, Dist.: Solan Himachal Pradesh - 173 205
(2) Village Katha, Near Charak Pharma, PO. Baddi, Tehsil: Nalagarh, Dist.: Solan Himachal Pradesh - 173 205
xxi. Address for Correspondence:
Company Secretary & Compliance Officer
Procter & Gamble Hygiene and Health Care Limited, P&G Plaza, Cardinal Gracias Road,
Chakala, Andheri (East), Mumbai - 400 099.
Investor helpline nos.: 91 86575 12368 / 86575 00524
Tel: (91-22) 2826 6000
Fax: (91-22) 2826 7337
Email id: investorpghh.im@pg.com
















Declaration

As provided under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board Members have confirmed compliance with the DirectorsÕ Code of Conduct for the Financial Year ended June 30, 2019 and the Senior Management has complied with the Business Conduct Manual for the Financial Year ended June 30, 2019.
For Procter & Gamble Hygiene and Health Care Limited

MUMBAI	Madhusudan Gopalan
August 21, 2019	Managing Director
20th August, 2019

To
The Board of Directors
Procter & Gamble Hygiene and Health Care Limited

Sub: Certificate under Para 10(i) of Part C under the Heading of
Corporate Governance Report of Schedule V Ð Annual Report read with Regulations 34(3)
of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (ÔListing RegulationsÕ)

1. This certificate has been issued at the request of the Company regarding the compliance status under the above captioned provision of Listing Regulations for the purpose of making a disclosure in the Annual report for the Financial Year ended 30th June, 2019.
2. The scope of the certificate is stated under para 10(i) of the Listing RegulationsÒÉÉa Company shall obtain a certificate from a company secretary in practice that none of the directors on the board of the company have been debarred or disqualified from being appointed or continuing as directors of companies by the Board/Ministry of Corporate Affairs or any such statutory authorityÓ
3. Pursuant to the aforementioned Listing Regulations, we have examined the following records:
a. The declaration given by the individual Directors of the Company with respect to their interest(s) in other entity(ies) as Director or otherwise along with their relatives in Form MBP-1 and same would be taken on record by the Company.
b. The particulars of Directors of the Company as displayed on the web portal of the Ministry of Corporate Affairs.
c. General search on Google and on the website of the Securities and Exchange Board of India and Reserve Bank of India.
Based on the aforementioned, we state that to the best of our knowledge and according to the information and explanations given to us by the Company, and verifications as deemed necessary and adequate made by us, we are of the opinion that on the date of this Certificate none of the Directors on the Board of the Company has been debarred or disqualified from being appointed or continuing as a Director of the Company by the Board/Ministry of Corporate Affairs or any such statutory authority as on June 30, 2019.
4. It is to be noted that our responsibility is limited to providing a reasonable assurance by way of an opinion as to the qualification/eligibility of each individual Director of the Company with regard to their holding the office as Director of the Company in accordance with the generally accepted procedure(s) and the process of due-diligence followed by us based on the information available, on best efforts basis as on 30th June, 2019 and it is to be noted that this report is neither based on any audit nor an expression of opinion on the personal credentials of the Directors of the Company.
5. It may be noted that this certificate is issued to the Company solely for the purpose of complying with the aforementioned provision under the Listing Regulations and shall not be used by the Company for purposes other than it is issued for.


For Dholakia & Associates LLP (Company Secretaries)

(CS Bhumitra V. Dholakia) Designated Partner FCS-977; CP No. 507

Independent AuditorsÕ Certificate on Corporate Governance
TO THE MEMBERS OF
PROCTER & GAMBLE HYGIENE AND HEALTH CARE LIMITED
This Certificate is issued in accordance with the terms of our Engagement Letter dated August 13, 2019.
This certificate is issued with regard to compliance of conditions of Corporate Governance by Procter & Gamble Hygiene and Health Care Limited (Ôthe CompanyÕ) for the year ended on June 30, 2019 as stipulated in Regulations 17 to 27 and clauses (b) to (i) of Regulation 46(2) and para C, D and E of Schedule V of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulation, 2015, as amended (ÔListing RegulationsÕ) pursuant to the Listing Agreement of the Company with Stock Exchanges.
ManagementÕs Responsibility
The compliance of conditions of Corporate Governance is the responsibility of the CompanyÕs Management, including the preparation and maintenance of all relevant supporting records and documents. This responsibility includes the design, implementation and maintenance of internal control and procedures to ensure the compliance with the conditions of the Corporate Governance stipulated in Listing Regulations.
AuditorÕs Responsibility
Our examination was limited to procedures and implementation thereof, adopted by the Company for ensuring compliance with the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.
We have examined the books of account and other relevant records and documents maintained by the Company for the purpose of providing reasonable assurance on the compliance with Corporate Governance requirements by the Company.
We conducted our verification in accordance with the Guidance Note on Reports or Certificates for Special Purposes (Revised 2016) issued by the Institute of Chartered Accountants of India (ÔICAIÕ). The Guidance note requires that we comply with the ethical requirements of the Code of Ethics issued by the ICAI which includes the concept of test check and materiality.
We have complied with the relevant applicable requirements of the Standard on Quality Control (SQC) 1, Quality Control for Firms that Perform Audits and Reviews of Historical Financial Information, and Other Assurance and Related Services Engagements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us and the representations made by the Management, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the above-mentioned Listing Regulations as applicable during the year ended June 30, 2019.
We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the Management has conducted the affairs of the Company.
Restriction on use
This certificate has been issued at the request of the Company solely for confirming the compliance of conditions of Corporate Governance as stipulated in Regulations 17 to 27 and clauses (b) to (i) of Regulation 46(2) and para C, D and E of Schedule V of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulation, 2015, as amended (ÔListing RegulationsÕ) pursuant to the Listing Agreement of the Company with Stock Exchanges and is not to be used for any other purpose. Accordingly, we do not accept or assume any liability or any duty of care for any other purpose or to any other person to whom this certificate is shown or into whose hands it may come without our prior consent in writing.

For KALYANIWALLA & MISTRY LLP CHARTERED ACCOUNTANTS
Firm Regn. No.: 104607W / W100166

Roshni R. Marfatia
Partner
M. No.: 106548
Mumbai: August 21, 2019	UDIN:  19106548AAAACC8290
INDEPENDENT AUDITORSÕ REPORT
To the Members of
Procter & Gamble Hygiene and Health Care Limited
Report on the Audit of the Ind AS Financial Statements Opinion
We  have  audited  the  Ind  AS  Financial  Statements of
PROCTER & GAMBLE HYGIENE AND HEALTH CARE
LIMITED (Òthe CompanyÓ), which comprise the Balance Sheet as at June 30, 2019, and the Statement of Profit and Loss (including other comprehensive income), the Statement of Cash Flows and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information (hereinafter referred to as ÔFinancial StatementsÕ).
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Financial Statements give the information required by the Companies Act, 2013 (the ÒActÓ) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (India Accounting Standard) Rules, 2015, as amended, (ÒInd ASÓ) and other accounting principles generally accepted in India, of the state of affairs of the Company as at June 30, 2019, the profit and total comprehensive income, its cash flows and the changes in equity for the year ended on that date.
Basis for Opinion
We conducted our audit of the Financial Statements in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the ÔAuditorÕs Responsibilities for the Audit of the Financial StatementsÕ section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the Financial Statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAIÕs Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on the Financial Statements.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Financial Statements of the current period. These matters were addressed in the context of our audit of the Financial Statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.

Sr.
Key Audit Matter
AuditorÕs Response
1.
Revenue Recognition (note no. 2.3(a) and 19 to the Financial Statements)
Revenue is measured net of trade discounts, rebates and various types of Marketing and Distribution Activities such as incentives and promotions.
The estimation of the various types of discounts, incentives and rebate schemes to be recognised based on sales made during the year is material and considered to be judgmental owing to the varying terms of the agreements with customers which are based on annual contracts or shorter term arrangements. In addition, the value and timing of promotions for products varies from period to period, and the activity can span over a year end.
Accumulated experience is used to estimate the provision for discounts and rebates considering the terms of the underlying schemes and arrangements with customers.
Our audit procedures included:
(a) Assessing the appropriateness of the revenue recognition accounting policies, including those relating to discounts and incentives by comparing with applicable accounting standards.
(b) Testing the design, implementation and operating effectiveness of the CompanyÕs general IT controls and key IT/manual application controls over the CompanyÕs systems which govern recording of revenue and rebates/ schemes in the general ledger accounting system.
(c) We tested the design, implementation and operating effectiveness of controls over the calculation of discounts and rebates including review of the independent service auditorÕs SOC 1 (Type 2) report with regards to the third party service organizationÕs system and the suitability of the design and operating effectiveness of IT / manual controls relating to processing of claims.





Sr.
Key Audit Matter
AuditorÕs Response

There is also a risk that revenue may be overstated due to fraud including through manipulation of the discounts and incentives recognised resulting from the pressure local management may feel to achieve performance targets.
(d) Performing substantive testing (including year-end cut- off testing) by selecting samples of revenue transactions recorded during the year (and before and after the financial year end) by verifying the underlying documents, which included sales invoices/contracts and shipping documents.
(e) We compared the historical discounts, rebates/schemes and allowances to current payment trends. We also considered the historical accuracy of the CompanyÕs estimates in previous years.
(f) Performing substantive testing by checking samples of rebate/schemes transactions to supporting documentation.
(g) We assessed manual journals posted to revenue to identify unusual items.
(h) Considering the adequacy of the CompanyÕs disclosures in respect of revenue.
2.
Uncertain Tax Positions (note no. 26 and 35 to the Financial Statements)
The Company is subject to a range  of  tax  risks. There is inherent judgement involved in determining provisions for uncertain tax positions. The Company is subject to periodic challenges by local tax authorities on a range of tax matters during the normal course of business, including direct taxes, transfer pricing and indirect taxes. Applicable tax laws and regulations are subject to differing interpretations  and  the  resolution  of a final tax position can take several years to complete. Where the amount of tax payable is uncertain, the Company establishes provisions based on ManagementÕs judgement of the likelihood of settlement being required.
Given the number of judgements involved in estimating the provisions relating to uncertain tax positions and the complexities of dealing with tax rules, this was considered as a key audit matter.
Our audit procedures included:
(a) We evaluated the design and tested the operating effectiveness of controls over the assessment of uncertain tax positions and completeness of disclosures.
(b) We discussed the status and potential exposures in respect of significant tax litigations with the CompanyÕs tax team including their views on the likely outcome of each assessment / litigation and magnitude of potential exposure.
(c) We focused on the judgements made by Management in assessing the likelihood of potentially material exposures and the estimates used to determine such provisions  where required. In particular, we focused on the impact of changes in local tax regulations and ongoing inspections by local tax authorities, which could materially impact the amounts recorded in the Financial Statements.
(d) We involved our in-house tax experts to evaluate and challenge the appropriateness of ManagementÕs assessment and judgements to estimate the provisions held in respect of uncertain tax positions. To do this, we assessed the provisions recognized in the Financial Statements using the outcome of prior and ongoing tax assessments conducted on the Company, correspondences between the Company and relevant tax authorities, judgemental positions taken in tax returns and current year estimates, our own experience in these areas and assessing whether the approach applied by the Company is supported by the practice in the industry.
(e) We have also assessed the adequacy of the CompanyÕs disclosures in respect of tax and uncertain tax positions.

Information Other than the Financial Statements and AuditorÕs Report Thereon
The CompanyÕs Board of Directors is responsible for the other information. The other information comprises the information in the Management Discussion and Analysis, Report of the Directors, Report on Corporate Governance and ShareholderÕs Information, but does not include the Financial Statements and our auditorÕs report thereon.
Our opinion on the Financial Statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the Financial Statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the Financial Statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
ManagementÕs Responsibility for the Standalone Financial Statements
The CompanyÕs Board of Directors is responsible for the matters in Section 134(5) of the Act with respect to the preparation of these Financial Statements that give a true and fair view of the financial position, financial performance, total comprehensive income, changes in equity and cash flows of the Company in accordance with the Ind AS and other accounting principles generally accepted in India. This responsibility also includes maintenance of adequate accounting records in accordance with the provision of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the  accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the Financial Statements, Management is responsible for assessing the CompanyÕs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern  basis of accounting unless the Management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
The Board of Directors are also responsible for overseeing the CompanyÕs financial reporting process.
AuditorÕs Responsibilities for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the Financial Statements as a whole are free from material misstatement, whether due to fraud or  error, and to issue an auditorÕs report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Financial Statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
¥ Identify and assess the risks of material misstatement of the Financial Statements, whether due to fraud   or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
¥ Obtain an understanding of internal financial control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.
¥ Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management.
¥ Conclude on the appropriateness of ManagementÕs use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the CompanyÕs ability to continue as a going concern. If we conclude that  a material uncertainty exists, we are required to  draw attention in our auditorÕs report to the related disclosures in the Financial Statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditorÕs report. However, future events or conditions may cause the Company to cease to continue as a going concern.


¥ Evaluate the overall presentation, structure and content of the Financial Statements, including the disclosures, and whether the Financial Statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the Financial Statements of the current period and are therefore the key audit matters. We describe these matters in our auditorÕs report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (AuditorÕs Report) Order, 2016 (Òthe OrderÓ), issued by the Central Government of India in terms of sub-section (11) of Section 143  of the Act, we give in the Annexure A, a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
2. As required by Section 143(3) of the Act, we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
c) The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), the Statement of Cash Flows and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.
d) In our opinion, the aforesaid Financial Statements comply with the Ind AS prescribed  under  section 133 of the Act, read with relevant rules issued thereunder.

e) On the basis of the written representations received from the directors as on June 30, 2019 taken on record by the Board of Directors, none of the directors is disqualified as on June 30, 2019 from being appointed as a director in terms of Section 164 (2) of the Act.
f) With respect to the adequacy of the internal financial controls with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate report in Annexure B.
g) With respect to the other matters to be included in the AuditorÕs Report in accordance with the requirements of section 197(16) of the Act, as amended:
In our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of section 197 of the Act.
h) With respect to the other matters to be included in the AuditorÕs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its Financial Statements Ð Refer Note. 35 to the Financial Statements.
ii. The Company did not have any material foreseeable losses on long term contracts including derivative contracts requiring provision under the applicable law or accounting standards.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.


For KALYANIWALLA & MISTRY LLP CHARTERED  ACCOUNTANTS
Firm Regn. No.: 104607W / W100166

Roshni Marfatia
PARTNER
             M. No. 106548 UDIN:  19106548AAAACB2516


MUMBAI, August 21, 2019
Annexure A to the Independent AuditorÕs Report
(Referred to in paragraph 1 under ÔReport on Other Legal and Regulatory RequirementsÕ in our Independent AuditorÕs Report to the Members of the Company on the Financial Statements for the year ended June 30, 2019).
(i) a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
b) As explained to us, the Company has a program for physical verification of fixed assets at periodic intervals. In our opinion, the period of verification is reasonable having regard to the size of the Company and the nature of its assets. The discrepancies reported on such verification are not material and have been properly dealt with in the books of account.
c) According to the information and explanations given to us, the title deeds, comprising all the immovable properties of buildings, other than self-constructed buildings, are held in the name of the Company. In respect of immovable properties of land that have been taken on lease and disclosed as non-current / current assets in the Financial Statements, the lease agreements are in the name of the Company, where the Company is the lessee in the agreement.
(ii) The inventory has been physically verified by the Management at reasonable intervals during the year. In our opinion, the frequency of such verification is reasonable. In respect of inventory lying with third parties, these have  substantially  been  confirmed  by them. The discrepancies noticed on verification between the physical stocks and the book records were not material.
(iii) In our opinion and according to the information and explanations given to us, the Company has not granted any loans, secured or unsecured, to companies, firms, limited liability partnerships or other parties covered in the register maintained under Section 189 of the Act. Accordingly, paragraph 3(iii) of the Order is not applicable to the Company.
(iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of section 185 and 186 of the Act, with respect to investments made, guarantees given and securities provided.
(v) According to the information and explanations given to us, the Company has not accepted deposits from the public to which the directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 of the Act and the rules framed thereunder apply. Accordingly, paragraph (v) of the Order is not applicable to the Company.
(vi) 
The maintenance of cost records has been prescribed by the Central Government under section 148(1) of the Companies Act, 2013 in respect of specified products of the Company. For such products we have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Records and Audit) Rules, 2014 as amended and are of the opinion that, prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.
(vii) According to the information and explanations given to us and records of the Company examined by us, in our opinion:
a) the Company is generally regular in depositing the undisputed statutory dues including Provident Fund, EmployeesÕ State Insurance, Income Tax, Duty of Customs, Goods and Services Tax, Cess, Professional Tax and other statutory dues, as applicable, with the appropriate authorities and there are no undisputed amounts which have remained outstanding as at the last day of the financial year, for a period of more than six months from the date they became payable.
b) there are no dues of Income Tax, Sales Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax and Goods and Services Tax which have not been deposited with the appropriate authorities on account of any dispute, other than the following:

Name of Statute
Nature of Dues
Forum where Dispute
is Pending
Period to which
the Amount
Relates*
 Amount Involved (` in lakhs)
**
The Central Excise Act, 1944
Excise duty
Appellate Authority - up to Commissioners/ Revisional
authorities Level
2000-01 to
2002-03
2


Customs, Excise and Service Tax
Appellate Tribunal
2007-08
73
Sales Tax and
Sales Tax
Appellate
1997-98 to
1,339
Laws as per
and VAT
Authority - up to
2001-02,

statutes applicable

Commissioners/
2003-04 to

in various states

Revisional
2015-16



authorities level




Appellate
1996-97,
1,659


Authority -
2001-02 to



Tribunal
2002-03,




2008-09 to




2012-13



High Court
1995-96,
123



2002-03,




2006-07,




2008-09 to




2009-10


Name of Statute
Nature of Dues
Forum where Dispute
is Pending
Period to which
the Amount
Relates*
 Amount Involved (` in lakhs)
**
Finance Act, 1994
Service tax
Appellate Authority - up to Commissioners/ Revisional authorities level
2006-07 to
2012-13
1,225
Income Tax Act,
Income Tax
Income Tax
2009-10,
9,573
1961

Appellate Tribunal
2010-11,




2012-13 to




2014-15



Commissioner
2015-16
43


of Income Tax




(Appeals)


* Period denotes the financial year April to March
** includes penalty and interest on taxes, wherever applicable
(viii) The Company has not taken any loans or borrowings from financial institutions, banks and government or has not issued any debentures. Accordingly, paragraph 3(viii) of the Order is not applicable to the Company.
(xiii) 
In our opinion and according to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with  Section  177  and 188 of the Act where applicable. The details of such related party transactions have been disclosed in the Financial Statements as required by the applicable accounting standards.
(xiv) According to the information and explanations give to us and based on our examination of the records, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year. Accordingly, paragraph 3(xiv) of the Order is not applicable to the Company.
(xv) According to the information and  explanations  given to us and based on our examination of the records,  the Company has not entered into any non-cash transactions with directors or persons connected with
(ix) The Company has not raised any money by way of initial public offer, further public offer (including debt instruments) and term loans during the year. Accordingly, the provisions of paragraph 3(ix) of the Order are not applicable to the Company.
(x) To the best of our knowledge and according to the information and explanations given to  us,  no  fraud  by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit.
(xi) In our opinion and according to the information and explanations given to us and based on our examination of the records, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.
(xii) In our opinion and according to the information and explanations given to us, the Company is not a Nidhi company. Accordingly, paragraph 3(xii) of the Order is not applicable to the Company.
him. Accordingly, paragraph 3(xv) of the Order is not applicable to the Company.
(xvi) The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, paragraph 3(xvi) of the Order is not applicable to the Company.



For KALYANIWALLA & MISTRY LLP CHARTERED  ACCOUNTANTS
Firm Regn. No.: 104607W / W100166

Roshni Marfatia
PARTNER
             M. No.: 106548 UDIN:  19106548AAAACB2516



MUMBAI, August 21, 2019
Annexure B to the Independent AuditorÕs Report
(Referred to in Para 2 (f) ÔReport on Other Legal and Regulatory  RequirementsÕ  in  our  Independent  AuditorÕs  Report to the members of the Company on the Financial Statements for the year ended June 30, 2019)
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (Òthe ActÓ)
We have audited the internal financial controls with reference to Financial Statements of PROCTER & GAMBLE HYGIENE AND HEALTH CARE LIMITED (Òthe CompanyÓ)
as of June 30, 2019 in conjunction with our audit of the Financial Statements of the Company for the year ended on that date.
ManagementÕs Responsibility for Internal Financial Controls
The CompanyÕs Management is responsible for establishing and maintaining internal financial controls based on the internal control with reference to financial statements criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (the ÒGuidance NoteÓ). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to companyÕs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
AuditorsÕ Responsibility
Our responsibility is to express an opinion on the CompanyÕs internal financial controls with reference to financial statements based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of Internal Financial Controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference to financial statements was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls with reference to financial statements and their operating effectiveness. Our audit of internal financial controls with reference to financial statements included obtaining an understanding of such internal financial controls, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditorÕs judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the CompanyÕs internal financial controls with reference to financial statements.
Meaning of Internal Financial Controls with reference to Financial Statements
A CompanyÕs  internal  financial  control  with  reference to financial statements is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A CompanyÕs internal financial control with reference to financial statements includes those policies and procedures that:
(1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;
(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of Management and directors of the Company; and
(3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the CompanyÕs assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls with reference to Financial Statements
Because of the inherent limitations of internal financial controls with reference to financial statements, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls with reference to financial statements to future periods are subject to the risk that the internal financial control with reference to financial statements may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal financial controls with reference to financial statements and such internal financial controls with reference to financial statements were operating
effectively as at June 30, 2019, based on the internal control with reference to financial statements criteria established by the Company considering the essential components of internal control stated in the Guidance Note.


For KALYANIWALLA & MISTRY LLP CHARTERED  ACCOUNTANTS
Firm Regn. No.: 104607W / W100166

Roshni Marfatia
PARTNER
             M. No.: 106548 UDIN:  19106548AAAACB2516



MUMBAI, August 21, 2019
Balance Sheet as at June 30, 2019


Notes	As at
June 30, 2019


        As at June 30, 2018
ASSETS
Non-current assets
` in lakhs	` in lakhs
Property, plant and equipment	4	23 422	25 011
Capital work-in-progress	4	1 455	2 148
Financial assets
(i)	Loans	6	3 913	4 201
(ii)  Other financial assets	7	40	88
Deferred tax assets (Net)	15	3 676	2 298
Non-current tax assets (Net)	15 439	19 580
Other non-current assets	10	 	6 186	5 603
Total non-current assets	 	54 131	 	58 929
Current assets
Inventories	8	20 342	12 361
Financial assets
(i) Trade receivables	5	18 066	14 847
(ii) Cash and cash equivalents	9 (a)	52 590	39 235
(iii) Bank balances other than (ii) above	9 (b)	1 455	724
(iv) Loans	6	10 127	9 940
(v)  Other financial assets	7	2 431	2 493
Other current assets	10	1 897	1 854
1 06 908	81 454
Non-current assets held for sale	10 (a)	 	2 152	 	2 152
Total current assets	 1 09 060	 	83 606
Total assets	 1 63 191	 1 42 535
EQUITY AND LIABILITIES
Equity
Equity share capital	11	3 246	3 246
Other equity	12	 	87 660	77 304
Total equity	 	90 906	 	80 550
Liabilities
Non-current liabilities
Provisions	14	 	6 550	4 873
Total non-current liabilities	 	6 550	 	4 873
Current liabilities
Financial liabilities
(i) Trade payables
Dues to micro and small enterprises	16	218	231
Dues to others	16	54 549	40 391
(ii) Other financial liabilities	13	4 645	1 927
Provisions	14	536	427
Current tax liabilities (Net)	17	2 614	10 419
Other current liabilities	18	 	3 173	3 717
Total current liabilities	 	65 735	 	57 112
Total liabilities	 	72 285	 	61 985
Total  equity and liabilities	 1 63 191	 1 42 535
See accompanying notes to the financial statements

In terms of our report attached
For KALYANIWALLA & MISTRY LLP	For and on behalf of Board of Directors
Chartered Accountants
R. A. Shah
Madhusudan Gopalan
Firm Regn. No.: 104607W / W100166
Chairman
Managing Director
Roshni Marfatia
DIN: 00009851
DIN: 08158357
Partner
Prashant Bhatnagar
Flavia Machado
M. No.: 106548
Chief Financial Officer
Company Secretary
Place : Mumbai
Date : August 21, 2019

Statement of Profit and Loss for the year ended June 30, 2019













































In terms of our report attached
For KALYANIWALLA & MISTRY LLP	For and on behalf of Board of Directors
Chartered Accountants
R. A. Shah
Madhusudan Gopalan
Firm Regn. No.: 104607W / W100166
Chairman
Managing Director
Roshni Marfatia
DIN: 00009851
DIN: 08158357
Partner
Prashant Bhatnagar
Flavia Machado
M. No.: 106548
Chief Financial Officer
Company Secretary
Place : Mumbai
Date : August 21, 2019
Statement of Cash Flows for the year ended June 30, 2019


Year ended
Year ended

June 30, 2019
` in lakhs
June 30, 2018
` in lakhs
A. Cash Flows from Operating Activities


Profit before tax
60 733
58 177
Adjustments for:


Depreciation expense
4 978
5 237
(Gain) / Loss on disposal of property, plant and equipment
(545)
613
Finance costs
548
532
Allowance for doubtful receivables (Net of recovery)
95
1
Interest income
(3 722)
(2 005)
Impairment of property, plant and equipment
Ñ
1 259
Net foreign exchange loss / (gain)
458
(163)
Expense recognised in respect of equity settled share based payments
418
540
Operating profit before working capital changes
62 963
64 191
Working capital adjustments


(Increase) in trade and other receivables
(3 315)
(1 653)
(Increase) / decrease in financial assets
(508)
5 342
(Increase) / decrease in inventories
(7 981)
5 374
(Increase) in other assets
(626)
(4 997)
Increase in trade and other payables
13 774
489
Increase in provisions
379
106
Cash generated from operations
64 686
68 852
Income taxes paid
(23 503)
(27 305)
Net cash generated from operating activities
41 183
41 547

B. Cash Flows from Investing Activities


Interest received
4 441
1 146
Loans realised
9 000
9 004
Loans given
(9 000)
(9 000)
Payment to acquire property, plant and equipment
(1 610)
(3 494)
Proceeds from sale of property, plant and equipment
1 446
(317)
Net bank deposits (placed)
(72)
(48)
Changes in earmarked balances
(659)
763
Net cash generated from / (used in) investing activities
3 546
(1 946)

Statement of Cash Flows for the year ended June 30, 2019
  Year ended June 30, 2019


  Year ended June 30, 2018
` in lakhs	` in lakhs
C. Cash Flows from Financing Activities

Dividend and dividend tax paid
(31 308)
(10 548)
Interest paid
(66)
(62)
Net cash (used in) financing activities
(31 374)
(10 610)
Net increase in cash and cash equivalents
13 355
28 991
Cash and cash equivalents at the beginning of the year
39 235
10 244
Cash and cash equivalents at the end of the year (refer note 9(a))
52 590
39 235

Note:
The above Cash Flow Statement has been prepared under the ÒIndirect MethodÓ as set out in the Indian Accounting Standard (Ind AS 7) - Statement of Cash Flows.

See accompanying notes to the financial statements

In terms of our report attached
For KALYANIWALLA & MISTRY LLP	For and on behalf of Board of Directors
Chartered Accountants
R. A. Shah
Madhusudan Gopalan
Firm Regn. No.: 104607W / W100166
Chairman
Managing Director
Roshni Marfatia
DIN: 00009851
DIN: 08158357
Partner
Prashant Bhatnagar
Flavia Machado
M. No.: 106548
Chief Financial Officer
Company Secretary
Place : Mumbai
Date : August 21, 2019
Statement of Changes in Equity for the year ended June 30, 2019


a. Equity share capital

Amount
` in lakhs
Balance as at July 1, 2017	3 246
Changes in equity share capital during the year	Ñ
Balance as at June 30, 2018	3 246
Changes in equity share capital during the year	Ñ
Balance as at June 30, 2019	3 246
b. Other equity

Attributable to the equity share holders of the Company Reserves & surplus


General
     reserve	
` in lakhs

Securities
   premium 
` in lakhs
Share options outstanding
 	account	
` in lakhs

Retained
     earnings	
` in lakhs

 	Total	
` in lakhs
Balance as at July 1, 2017
30 959
7 519
791
10 097
49 366
Profit for the year
Ñ
Ñ
Ñ
37 459
37 459
Items of OCI for the year, net of tax





Remeasurement benefit of defined benefit plans
Ñ
Ñ
Ñ
487
487
Total comprehensive income for the year
Ñ

Ñ

Ñ

37 946

37 946
Payment of dividends (refer note 39)
Ñ

Ñ

Ñ

(8 764)

(8 764)
Payment of dividend distribution tax
Ñ

Ñ

Ñ

(1 784)

(1 784)
Recognition of share-based payments
Ñ

Ñ

540

Ñ

540
Balance as at June 30, 2018
30 959

7 519

1 331

37 495

77 304
Profit for the year
Ñ

Ñ

Ñ

41 913

41 913
Items of OCI for the year, net of tax









Remeasurement benefit of defined benefit plans
Ñ

Ñ

Ñ

(667)

(667)
Total comprehensive income for the year
Ñ

Ñ

Ñ

41 246

41 246
Payment of dividends (refer note 39)
Ñ

Ñ

Ñ

(25 968)

(25 968)
Payment of dividend distribution tax
Ñ

Ñ

Ñ

(5 340)

(5 340)
Recognition of share-based payments
Ñ

Ñ

418

Ñ

418
Balance as at June 30, 2019
30 959

7 519

1 749

47 433

87 660
See accompanying notes to the financial statements

In terms of our report attached
For KALYANIWALLA & MISTRY LLP	For and on behalf of Board of Directors
Chartered Accountants
R. A. Shah
Madhusudan Gopalan
Firm Regn. No.: 104607W / W100166
Chairman
Managing Director
Roshni Marfatia
DIN: 00009851
DIN: 08158357
Partner
Prashant Bhatnagar
Flavia Machado
M. No.: 106548
Chief Financial Officer
Company Secretary
Place : Mumbai
Date : August 21, 2019

Notes to Financial Statements for the year ended June 30, 2019

1. Corporate information
Procter & Gamble Hygiene and Health Care Limited (Ôthe CompanyÕ) is a public company domiciled in India and is incorporated under the provisions of the Companies Act, 1956. Its ordinary shares (Equity) are listed on two recognised stock exchanges in India. The registered office of the Company is located at P&G Plaza, Cardinal Gracias Road, Chakala, Andheri (E), Mumbai - 400099.
The Company is engaged in manufacturing and selling of branded packaged fast moving consumer goods in the femcare and healthcare businesses. The CompanyÕs products are sold through retail operations including mass merchandisers, grocery stores, membership club stores, drug stores, department stores and high frequency stores. The Company has its manufacturing locations at Goa and Baddi in Himachal Pradesh, apart from third party manufacturing locations spread across India.
2. Significant  accounting policies
2.1 Statement of compliance
The financial statements of the Company have been prepared in accordance with Indian Accounting Standard (Ind AS) as per the Companies (Indian Accounting Standards) Rules, 2015 as amended and notified under Section 133 of the Companies Act, 2013 (Òthe ActÓ) and other relevant provisions of the Act.
2.2 Basis of preparation and presentation
The financial statements have been prepared on accrual and going concern basis. The accounting policies are applied consistently to all the periods presented in the financial statements. All assets and liabilities have been classified as current or non-current as per the CompanyÕs normal operating cycle and other criteria as set out in the Division II of Schedule III to the Companies Act, 2013. Based on the nature of products and the time between acquisition of assets for processing and their realisation in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current or non-current classification of assets and liabilities.
The financial statements have been prepared on the historical cost basis except for certain items that are measured at fair values at the end of the reporting period, as explained in accounting policies below.
Historical cost is generally based on the fair value of the consideration given in exchange for goods and services.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the Company takes into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date. Fair value for measurement and / or disclosure purposes in these financial statements is determined on such a basis, except for share-based payment transactions that are within the scope of Ind AS 102, leasing transactions that are within the scope of Ind AS 17, and measurement that have some similarities to fair value but are not fair value, such as net realisable value in Ind AS 2.
In addition, for the financial reporting purposes, fair value measurements are categorised into Level 1, 2, or 3 based on the degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows:
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date;
Level 2 inputs are inputs, other than quoted prices included within level 1, that are observable for asset or liability, either directly or indirectly; and
Level 3 inputs are unobservable inputs for the asset or liability.
2.3 Summary of Significant accounting policies
a. Revenue recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured, regardless of when the payment is being made. Revenue is measured at the fair value of the consideration received or receivable, taking into account contractually defined terms of payment and excluding taxes or duties collected on behalf of the government. The Company has concluded that it is the principal in all of its revenue arrangements since it is the primary obligor in all the revenue arrangements as it has pricing latitude and is also exposed to inventory and credit risks. Revenue is reduced for rebates and other similar allowances. Accumulated experience is used to estimate and accrue for the discounts and rebates considering the terms of the underlying schemes and arrangements with customers.
Notes to Financial Statements for the year ended June 30, 2019

The specific recognition criteria described below must also be met before revenue is recognised.
Sale of goods
Revenue from the sale of goods is recognised when the goods are delivered and titles have passed, at which time all the following conditions are satisfied:
a. the Company has transferred to the buyer the significant risks and rewards of ownership of the goods;
b. the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
c. the amount of revenue can be measured reliably;
d. it is probable that the economic benefits associated with the transaction will flow to the Company; and
e. the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Interest income
Interest income is recorded using the Effective Interest Rate (EIR). Interest income is included in other income in the Statement of Profit and Loss.
b. Leasing
Leases are classified as finance lease whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating lease.
The determination of whether an arrangement is (or contains) a lease is based on the substance of the arrangement at the inception of the lease. The arrangement is, or contains, a lease if fulfillment of the arrangement is dependent on the use of a specific asset or assets and the arrangement conveys a right to use the asset or assets, even if that right is not explicitly specified in an arrangement.
The Company as a lessee
Assets held under finance leases are initially recognised at their fair value at the inception of the lease or, if lower, at the present value of the minimum lease payments. The corresponding liability to the lessor is included in the balance sheet as a financial lease obligation.
Lease payments are apportioned between finance expenses and reduction of the lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability. Finance expenses are recognised immediately in the Statement of Profit and Loss, unless they are directly attributable to qualifying assets, in which case they are capitalised in accordance with the CompanyÕs general policy on the borrowing costs (refer note 2.3(d)).
Rental expenses from operating leases is generally recognised on a straight-line basis over the lease term of the relevant lease. Where the rentals are structured solely to increase in line with the expected general inflation to compensate for the lessorÕs expected inflationary cost increase, such increases are recognised in the year in which such benefits accrue. Contingent rental arising under operating leases are recognised as an expense in the period in which they are incurred.
In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The aggregate benefit of incentives is recognised as a reduction of rental expense on a straight- line basis, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
c. Foreign currencies
The financial statements are presented in Indian Rupees (` in lakhs), which is also the CompanyÕs functional currency.
Transaction and balances
Transactions in currencies other than the CompanyÕs functional currency i.e. (foreign currencies) are recognised at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that

Notes to Financial Statements for the year ended June 30, 2019

date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value is determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.
Exchange differences on monetary items are recognised in the Statement of Profit and Loss in the period which they arise.
d. Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily takes a substantial period of time to get ready for its intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.
All other borrowing costs are recognised in the Statement of Profit and Loss in the period in which they are incurred.
e. Employee benefits
i) Post-employment Benefits
a) Defined Contribution Plans:
The Company has Defined Contribution Plans for post employment benefits charged to the Statement of Profit and Loss, in the form of
Ð Provident Fund administered by the Regional Provident Fund Commissioner;
Ð Superannuation Fund as per Company policy administered by Company managed trust; and
Ð State Defined Contribution Plans: EmployerÕs Contribution to EmployeesÕ State Insurance.
b) Defined Benefit Plans:
Funded Plan: The Company has Defined Benefit Plan for post employment benefits in the form of
Ð Gratuity for all employees administered through trust.
Unfunded Plan: The Company has unfunded Defined Benefit Plans in the form of Post Retirement Medical Benefits (PRMB) and Compensated Absences (plant technicians) as per its policy.
Liability for the above defined benefit plans is provided on the basis of valuation, as at the Balance Sheet date, carried out by independent actuary. The actuarial method used for measuring the liability is the Projected Unit Credit method.
Remeasurements, comprising actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets (excluding amounts included in net interest on the net defined benefit liability), are recognised immediately in the balance sheet with a corresponding debit or credit to retained earnings through other comprehensive income in the period in which they occur. Remeasurements are not reclassified to the Statement of Profit and Loss in subsequent periods.
Past service costs are recognised in the Statement of Profit and Loss on the earlier of:
?	The date of the plan amendment or curtailment, and
?	The date that the company recognises related restructuring costs
Net interest is calculated by applying the discount rate at the beginning of the year to the net defined benefit liability or asset. The company recognises the following changes in the net defined benefit obligation as an expense in the Statement of Profit and Loss:
? Service costs comprising current service costs, past-service costs, gains and losses on curtailments and non-routine settlements; and
? Net interest expense or income
ii) Liability for Compensated Absences and Leave Travel Allowance which are in the nature of short term benefits is provided for as per company rules based on the undiscounted amount of benefits expected to be paid in exchange of services rendered.
Notes to Financial Statements for the year ended June 30, 2019

iii) Termination benefits and long service awards in terms of Company policy are recognised as an expense as and when incurred.
f. Share-based payment arrangements
Employees (including senior executives) of the Company receive remuneration in the form of share-based payments, whereby employees render services as consideration for equity instruments (equity-settled transactions).
Equity-settled transactions
The Procter & Gamble Company, USA has an ÒEmployee Stock Option Plan (ESOP)Ó whereby the specified employees covered by the plan are granted an option to purchase shares of the Ultimate Holding Company
i.e. - The Procter & Gamble Company, USA at a fixed price (grant price) for a fixed period of time. The difference between the market price and grant price on the exercise of the stock options issued by the Ultimate Holding Company to the employees of the Company is charged in the year of exercise by the employees. Parent Company will recharge an amount equal to spread as on date of exercise of options.
The cost of equity-settled transactions is recognised in employee benefits expense (refer note 2.3(e)), together with a corresponding increase in equity (other reserves) over the period in which the service and performance conditions are fulfilled (the vesting period). The cumulative expense recognised for equity- settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the CompanyÕs best estimate of the number of equity instruments that will ultimately vest. Recharge to parent company to the extent of fair value of options will be debited in equity reserves and any excess recharge above the fair value of options will be recognised as equity distribution from the company.
Employee share purchase plan
The Procter & Gamble Company, USA has an ÒInternational Stock Ownership Plan (ISOP)Ó (employee share purchase plan) whereby specified employees of its subsidiaries have been given a right to purchase shares of the Ultimate Holding Company i.e. The Procter and Gamble Company, USA. Every employee who opts for the scheme contributes by way of payroll deduction up to a specified percentage (upto 15%) of base salary towards purchase of shares on a monthly basis. The Company contributes 50% of employeeÕs contribution (restricted to 2.5% of his base salary) and charged to employee benefits expense. The expenses related ISOP are recognised immediately in the Statement of Profit and Loss since there are no vesting conditions attached to the scheme.
The expense in the Statement of Profit and Loss for a period represents the movement in cumulative expense recognised as at the beginning and end of that period.
When the terms of an equity-settled award are modified, the minimum expense recognised is the expense had the terms had not been modified, if the original terms of the award are met. An additional expense is recognised for any modification that increases the total fair value of the share-based payment transaction, or is otherwise beneficial to the employee as measured at the date of modification. Where an award is cancelled by the entity or by the counterparty, any remaining element of the fair value of the award is expensed immediately through the Statement of Profit and Loss.
g. Taxation
Income tax expense represents the sum of the current tax and deferred tax.
Current tax
Provision for current tax for the CompanyÕs financial year ended on June 30 is based on the results of the period July 1 to March 31 (later part of the fiscal year ended March 31) and for the balance and for the period April 1 to June 30 (beginning of the next fiscal year) as per the provisions of the Income Tax Act, 1961 and other applicable tax laws. Taxable profit differs from Ôprofit before taxÕ as reported in the Statement of Profit and Loss because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible. The CompanyÕs current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.

Notes to Financial Statements for the year ended June 30, 2019

Deferred tax
Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profits. Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that taxable profit will be available against which those deductible temporary differences can be utilised.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the asset  to be recovered.
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset is realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.
The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.
Current and deferred tax for the year
Current and deferred tax are recognised in the Statement of Profit and Loss, except when they relate to items that are recognised in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognised in other comprehensive income or directly in equity respectively.
Current tax assets and current tax liabilities are offset when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle the asset and the liability on a net basis. Deferred tax assets and deferred tax liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities; and the deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same taxation authority.
h. Property, plant and equipment
Property, plant and equipment held for use in the production or supply of goods or services, or for administrative purposes, are stated in the balance sheet at acquisition cost less accumulated depreciation and accumulated impairment losses, if any. Freehold land is not depreciated. Subsequent costs are included in the assetsÕ carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow.
Properties in the course of construction for production, supply or administrative purposes are carried at cost, less any recognised impairment loss. Cost includes professional fees and, for qualifying assets, borrowing costs capitalised in accordance with the CompanyÕs accounting policy. Such properties are classified to the appropriate categories of property, plant and equipment when completed and ready for intended use. Depreciation of these assets, on the same basis as other property assets, commences when the assets are ready for their intended use.
Cost of Property, plant and equipment which are not ready for intended use, as on the Balance Sheet date, is shown as capital work in progress. All other repairs and maintenance cost are charged to the Statement of Profit and Loss during the period in which they are incurred.
Depreciation is recognised so as to write off the cost of assets (other than freehold land) less their residual values over their useful life, using straight-line method. The estimated useful lives, residual values and depreciation method are reviewed at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis.
The managementÕs estimate of useful lives are in accordance with Schedule II to the Companies Act, 2013 other than certain assets which are based on CompanyÕs expected usage pattern supported by technical assessment.
Notes to Financial Statements for the year ended June 30, 2019

The estimated useful life of certain property, plant and equipment of the Company are as follows:

Asset Class
Useful lives
Buildings
20-30 years
Plant & machinery
10-15 years
Furniture and fixtures
3-15 years
Office equipment
3-15 years
Moulds & Dies
3-15 years
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item if property, plant and equipment is determined as the difference between the sale proceeds and the carrying amount of the asset and is recognised in the Statement of Profit and Loss.
i. Impairment of property, plant and equipment
At the end of each reporting period, the Company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount is estimated in order to determine the extent of the impairment loss (if any). When it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs. When a reasonable and consistent basis of allocation can be identified, corporate assets are also allocated to individual cash- generating units, or otherwise they are allocated to the smallest group of cash-generating units for which a reasonable and consistent basis can be identified.
Recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its own carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in the Statement of Profit and Loss.
When an impairment loss subsequently reverses, the carrying amount of the asset (or a cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal is recognised immediately in the Statement of Profit and Loss.
j. Inventories
Inventories consist of raw and packing materials, stores and spares, work in progress, stock-in-trade  and finished goods. Inventories are valued at lower of cost and net realisable value after providing for obsolescence and other losses where considered necessary. Cost of Inventories is determined on weighted average basis. Cost of manufactured finished goods and work-in-progress includes material cost determined on weighted average basis and also includes an appropriate portion of allocable overheads.
Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary to make the sale.
k. Provisions, Contingent Liabilities and Contingent Assets
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. When the Company expects some or all of a provision to be reimbursed, for example, under an insurance contract, the reimbursement is recognised as a separate asset, but only when the reimbursement is virtually certain. The expense relating to a provision is presented in the Statement of Profit and Loss net of any reimbursement.

Notes to Financial Statements for the year ended June 30, 2019

If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.
Contingent liabilities are disclosed in the Notes. Contingent liabilities are disclosed for (1) possible obligations which will be confirmed only by future events not wholly within the control of the Company or (2) present obligations arising from past events where it is not probable that an outflow of resources will be required to settle the obligation or a reliable estimate of the amount of the obligation cannot be made.
Contingent assets are not recognised in the financial statements as this may result in the recognition of income that may never be there.
l. Financial instruments
Financial assets and financial liabilities are recognised when the Company becomes a party to the contractual provisions of the instrument.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of the financial asset and financial liabilities (other than financial asset and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial asset or financial liabilities, as appropriate, on initial recognition. Transactions costs directly attributable to the acquisition of financial asset and financial liabilities at fair value through profit or loss are recognised immediately in the Statement of Profit and Loss.
m. Financial assets
All regular way purchases or sales of financial assets are recognised and derecognised on a trade date basis. Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within the time frame established by regulation or convention in the market place.
All recognised financial assets are subsequently measured at either amortised cost or fair value, depending on the classification of the financial assets.
Classification of financial assets
Debt instruments that meet the following conditions are subsequently measured at amortised cost:
a) The asset is held within a business model whose objective is to hold assets in order or collect contractual cash flows; and
b) The contractual terms of the instrument give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
Debt instruments that does not meet the above conditions are subsequently measured at fair value.
Effective interest method
The effective interest is a method calculating the amortised cost of a debt instrument and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the debt instrument, or, where appropriate, a shorter period, to the net carrying amount in initial recognition.
Income is recognised on an effective interest basis for debt instruments. Interest income is recognised in Statement of Profit and Loss and is included in the ÒOther incomeÓ line item.
Impairment of financial assets
The Company applies expected credit loss model for recognising impairment loss on financial assets measured at amortised cost, trade receivables and other contractual rights to receive cash or other financial asset.
Expected credit losses are the weighted average of credit losses with the respective risks of default occurring as the weights. Credit loss is the difference between all contractual cash flows that are due to the Company in accordance with the contract and all the cash flows that the Company expects to receive (i.e. all cash shortfalls), discounted at the original effective interest rate (or credit-adjusted effective interest rate for purchased or originated credit-impaired financial assets). The Company estimates cash flows by considering all contractual terms of the financial instrument (for example, prepayment, extension, call and similar options) through the expected life of that financial instrument.
Notes to Financial Statements for the year ended June 30, 2019

The Company measures the loss allowance for a financial instrument at an amount equal to the lifetime expected credit losses if the credit risk on that financial instrument has increased significantly since initial recognition. If the credit risk on a financial instrument has not increased significantly since initial recognition, the Company measures the loss allowance for that financial instrument at an amount equal to 12-month expected credit losses. 12-month expected credit losses are portion of the life-time expected credit losses and represent the lifetime cash shortfalls that will result if default occurs within the 12 months after the reporting date and thus, are not cash shortfalls that are predicted over the next 12 months.
For trade receivables or any contractual right to receive cash, the Company always measures the loss allowance at an amount equal to lifetime expected credit losses.
Further, for the purpose of measuring lifetime expected credit loss allowance for trade receivables, the Company has used a practical expedient as permitted under Ind AS 109. This expected credit loss allowance is computed based on a provision matrix which takes into account historical credit loss experience with adjusted for forward-looking information.
Derecognition of financial assets
The Company derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another party. If the Company neither transfers nor retains substantially all of the risks and rewards of ownership and continues to control the transferred asset, the Company recognises its retained interest in the asset and an associated liability for amounts it may have to pay. If the Company retains substantially all of the risks and rewards of ownership of a transferred financial asset, the Company continues to recognise the financial asset and also recognises a collateralised borrowing for the proceeds received.
On derecognition of a financial asset in its entirety, the difference between the assetÕs carrying amount and the sum of the consideration received and receivable and the cumulative gain or loss that had been recognised in other comprehensive income and accumulated in equity is recognised in profit or loss if such gain or loss would have otherwise been recognised in the Statement of Profit and Loss on disposal of that financial asset.
On derecognition of a financial asset other than in its entirety, the Company allocates the previous carrying amount of the financial asset between the part it continues to recognise under continuing involvement, and the part it no longer recognises on the basis of the relative fair values of those parts on the date of the transfer. The difference between the carrying amount allocated to the part that is no longer recognised and the sum of the consideration received for the part no longer recognised and any cumulative gain or loss allocated to it that had been recognised in other comprehensive income is recognised in the Statement of Profit and Loss on disposal of that financial asset. A cumulative gain or loss that had been recognised in other comprehensive income is allocated between the part that continues to be recognised and the part that is no longer recognised on the basis of the relative fair values of those parts.
Foreign exchange gains and losses
The fair value of financial assets denominated in a foreign currency is determined in that foreign currency and translated at the spot rate at the end of each reporting period.
For foreign currency denominated financial assets measured at amortised cost, the exchange differences are recognised in Statement of Profit and Loss.
n. Financial liabilities and equity instruments Classification as debt or equity
Debt and equity instruments issued by the Company are classified as either financial liability or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.
Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by the Company is recognised at the proceeds received, net of direct issue costs.

Notes to Financial Statements for the year ended June 30, 2019

Repurchase of the CompanyÕs own equity instruments is recognised and deducted directly in equity. No gain or loss is recognised in Statement of Profit and Loss on the purchase, sale, issue or cancellation of the CompanyÕs own equity instruments.
Financial liabilities
All financial liabilities are subsequently measured at amortised cost using the effective interest method.
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and borrowings, payables, as appropriate.
Financial liabilities that are not held-for-trading and are not designated as at fair value through profit or loss are measured at amortised cost at the end of the subsequent accounting period. The carrying amount of financial liabilities that are subsequently measured at amortised cost are determined based on the effective interest method. Interest expense that is not capitalised as part of costs of an asset is included in the ÒFinance costsÓ line item.
The effective interest method is a method of calculating the amortised cost of a financial liability and     of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial liability, or, (where appropriate), a shorter period, to the net carrying amount at initial recognition.
Foreign exchange gains and losses
For financial liabilities that are denominated in a foreign currency and are measured at amortised cost at the end of each reporting period, the foreign exchange gains and losses are determined based on the amortised cost of the instrument and are recognised in Statement of Profit and Loss.
Derecognition
The Company derecognises a financial liability when, and only when, the CompanyÕs obligations are discharged, cancelled or have expired. An exchange with a lender of debt instruments with substantially different terms is accounted for as an extinguishment of the original financial liability and the recognition of a new liability. Similarly, a substantial modification of the terms of an existing financial liability is accounted for as an extinguishment of the original financial liability and the recognition of a new liability. The difference between the carrying amount of the financial liability derecognised and the consideration paid and payable is recognised in Statement of Profit and Loss.
o. Segment Reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker (CODM) of the Company. The CODM is responsible for allocating resources and assessing performance of the operating segments of the Company.
p. Cash and Cash Equivalents
Cash and cash equivalents for the purpose of Cash Flow Statement comprise cash and cheques in hand, bank balances, demand deposits with banks where the original maturity is three months or less and other short term highly liquid investments.
q. Earnings Per Share
Basic earnings per share is computed by dividing the profit for the year after tax attributable to the equity shareholders of the Company by the weighted average number of equity shares outstanding during the period. The weighted average number of equity shares outstanding during the period and for all periods presented is adjusted for events, such as bonus shares, other than the conversion of potential equity shares that have changed the number of equity shares outstanding, without a corresponding change in resources.
For the purpose of calculating diluted earnings per share, the net profit for the year attributable to equity shareholders and the weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.
Notes to Financial Statements for the year ended June 30, 2019

r. Claims
Claims against the Company not acknowledged as debts are disclosed after a careful evaluation of the facts and legal aspects of the matter involved.
s. Assets held for sale
Non-current assets or disposal groups comprising of assets and liabilities are classified as Ôheld for saleÕ if it is highly probable that they will be recovered primarily through sales rather than through continuing use. Subsequently, such non-current assets and disposal groups classified as held for sale are measured at lower of its carrying value and fair value less costs to sell. Losses on initial classification as held for sale and subsequent gains and losses on re-measurement are recognised in profit and loss. Non-current assets held for sale are not depreciated or amortised.
t. Recent accounting pronouncements
Standards issued but not yet effective
In March 2019, the Ministry of Corporate Affairs (MCA) issued the Companies (Indian Accounting Standards) Amendment Rules, 2019 and Companies (Indian Accounting Standards) Second Amendment Rules, 2019, notifying Ind AS 116 ÔLeasesÕ and amendments to certain IND AS. The Standard / amendments are applicable to the Company with effect from July 1, 2019.
(i) Ind AS 116: Leases
The standard changes the recognition, measurement, presentation and disclosure of leases. It requires:
Ð Lessees to record all leases on the balance sheet with exemptions available for low value and short-term leases.
Ð At the commencement of a lease, a lessee will recognise lease liability and an asset representing the right to use the asset during the lease term (right-of-use asset).
Ð Lessees will subsequently reduce the lease liability when paid and recognise depreciation on the right-of-use asset.
Ð A lease liability is remeasured upon the occurrence of certain events such as a change in the lease term or a change in an index or rate used to determine lease payments. The remeasurement normally also adjusts the right-of-use asset.
Ð The standard has no impact on the actual cash flows of a Company. However, operating lease payments currently expensed as operating cash outflows will instead be capitalised and presented as financing cash outflows in the statement of cash flows.
The Company has reviewed all relevant contracts to identify leases and preparations for this standard are substantially complete.
This review included:
¥ an assessment about whether the contract depends on a specific asset,
¥ whether the company obtains substantially all the economic benefits from the use of that asset; and
¥ whether the Company has the right to direct the use of that asset.
From July 1, 2019 the Company will focus on ensuring that the revised process for identifying and accounting for leases is followed.
(ii) Other Amendments
The MCA has notified below amendments which are effective July 1, 2019:
¥ Appendix C to Ind AS 12, Income taxes
¥ Amendments to Ind AS 109, Financial Instruments
¥ Amendments to Ind AS 19, Employee Benefits
Based on Preliminary work, the Company does not expect these amendments to have any significant impact on its Financial Statements.

Notes to Financial Statements for the year ended June 30, 2019

3. Critical accounting judgments and key sources of estimation uncertainty
3.1 Critical judgments in applying accounting policies
In the application of the CompanyÕs accounting policies, which are described in note 2, the directors of the Company are required to make judgments, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods of the revision affects both current and future periods.
3.2 Key sources of estimation uncertainty
The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period that may have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.
a. Useful lives of property, plant and equipment
As described at 2.3 (h) above, the Company reviews the estimated useful lives of property, plant and equipment at the end of each reporting period.
b. Fair value measurements and valuation processes
Some of the CompanyÕs assets and liabilities are measured at fair value for financial reporting purposes. The management of the Company determines the appropriate valuation techniques and inputs for fair value measurements.
In estimating the fair value of an asset or a liability, the Company uses market-observable data to the extent it is available. Where level 1 inputs are not available, the Company engages third party qualified valuers to perform the valuation. The management works closely with the qualified external valuers to establish the appropriate valuation techniques and inputs to the model.
Information about the valuation techniques and inputs used in determining the fair value of various assets and liabilities is disclosed in note 30.
c. Defined benefit obligation
The costs of providing pensions and other post-employment benefits are charged to the Statement of Profit and Loss in accordance with Ind AS 19 ÔEmployee benefitsÕ over the period during which benefit is derived from the employeesÕ services. The costs are assessed on the basis of assumptions selected by the management. These assumptions include salary escalation rate, discount rates, expected rate of return on assets and mortality rates. The same is disclosed in Note 23, ÔEmployee benefits expenseÕ.
d. Income taxes
The CompanyÕs tax jurisdiction is India. Significant judgments are involved in estimating budgeted profits for the purpose of paying advance tax, determining the provision for income taxes, including amount expected to be paid / recovered for uncertain tax positions (refer note 26).
Notes to Financial Statements for the year ended June 30, 2019
4. Property, plant and equipment and capital work-in-progress


Freehold land


Buildings

   Plant & machinery

Furniture and
fixtures

     Office equipment

Moulds &
Dies


Total

` in lakhs

` in lakhs

` in lakhs

` in lakhs

` in lakhs

` in lakhs

` in lakhs
Gross Block
At July 1, 2017

752


7 788


25 202


732


2 269


863


37 606
Additions
Ñ

217

4 471

306

212

178

5 384
Disposals
Ñ

(3)

(394)

(10)

Ñ

Ñ

(407)
Adjustment / Reclassification #
Ñ

8

1 513

37

313

178

2 049
Reclassified as assets held for sale
 	(309)

 	(2 117)

 	(1 955)

 	(75)

 	Ñ 

 	(180)

 	(4 636)
At June 30, 2018
443

5 893

28 837

990

2 794

1 039

39 996
Additions
Ñ

505

2 306

58

862

559

4 290
Disposals
 	Ñ 

 	(8)

 	(911)

 	(15)

 	(7)

 	(123)

 	(1 064)
At June 30, 2019 Accumulated depreciation
At July 1, 2017
443

Ñ

6 390

914

30 232

6 450

1 033

316

3 649

1 083

1 475

272

43 222

9 035
Depreciation charge for the year
Ñ

479

3 967

181

382

228

5 237
Disposals
Ñ

Ñ

(109)

(2)

Ñ

Ñ

(111)
Adjustment / Reclassification #
Ñ

8

1 513

37

313

178

2 049
Eliminated on reclassification as held for sale
Ñ

(293)

(784)

(28)

Ñ

(120)

(1 225)
At June 30, 2018
Ñ

1 108

11 037

504

1 778

558

14 985
Depreciation charge for the year
Ñ

420

3 796

111

458

193

4 978
Disposals
 	Ñ 

 	Ñ 

 	(107)

 	(1)

 	(1)

 	(54)

 	(163)
At June 30, 2019
Ñ

1 528

14 726

614

2 235

697

19 800
Impairment losses recognised in profit or loss













At July 1, 2017
Ñ

Ñ

Ñ

Ñ

Ñ

Ñ

Ñ
Impairment for the year
Ñ

984

225

15

Ñ

35

1 259
Eliminated on reclassification as held for sale
 	Ñ 

 	(984)

 	(225)

 	(15)

 	Ñ 

 	(35)

 	(1 259)
At June 30, 2018
Ñ

Ñ

Ñ

Ñ

Ñ

Ñ

Ñ
Impairment losses recognised in profit or loss
Ñ

Ñ

Ñ

Ñ

Ñ

Ñ

Ñ
At June 30, 2019
Ñ

Ñ

Ñ

Ñ

Ñ

Ñ

Ñ
Net carrying amount
 	
 	
 	
 	
 	
 	
At June 30, 2019
 	443 
 	4 862 
 	15 506 
 	419 
 	1 414 
 	778	 	23 422 
At June 30, 2018
 	443 
 	4 785 
 	17 800 
 	486 
 	1 016 
 	481	 	25 011 
At July 1, 2017
 	752 
 	6 874 
 	18 752 
 	416 
 	1 186 
 	591	 	28 571 

At June 30,
2019
At June 30,
2018




` in lakhs	` in lakhs
Capital work-in-progress	 	1 455	 	2 148 
 	1 455	 	2 148 
Notes:
None of the above assets are mortgaged / hypothecated as security by the Company.
The amount of contractual commitments for the acquisition of property, plant and equipment is disclosed in note 34. # Adjustments comprise of reclassification between the gross block and accumulated depreciation.

Notes to Financial Statements for the year ended June 30, 2019

4.1 Impairment losses recognised
In the previous year certain Property, Plant & Equipment had been tested for impairment and a loss amounting to
` 1 259 lakhs had been recognized in the Statement of Profit and Loss. These were rendered redundant due to Company moving its manufacturing facility from one location to another. The said assets have been classified as ÔHeld for saleÕ in note 10(a).
The impairment losses on non-financial assets have been included in the Statement of Profit and Loss as ÒImpairment lossesÓ for the year ended June 30, 2018.
5. Trade receivables

As at
June 30, 2019
As at
June 30, 2018

` in lakhs
` in lakhs
Unsecured, considered good
18 066
14 847
Credit Impaired
245
146

18 311
14 993
Less: Allowance for expected credit loss
(245)
(146)

 	18 066 
 	14 847 
The Company has used a practical expedient by computing the expected credit loss allowance for trade receivables based on a provision matrix. The provision matrix takes into account historical credit loss experience and adjusted for forward-looking information. The expected credit loss allowance is based on the ageing of the days the receivables are due and the rates as per the provision matrix.
The concentration of credit risk is limited due to the fact that the customer base is large and unrelated.
Movement in the allowance for doubtful receivables
        As at June 30, 2019
       
As at June 30, 2018
` in lakhs	` in lakhs
Balance at the beginning of the year	146	145
Amounts written off during the year (net)	4	Ñ
Change in allowance for credit impairment during the year	95	1
Balance at the end of  the year	 	245	 	146 
6. Loans
        As at June 30, 2019
        
As at June 30, 2018
Unsecured considered good Non-current
` in lakhs	` in lakhs
Security deposits	548	503
Loans to related parties (refer note (a), (c) and note 32)		7		Ñ Loan to employees (refer note (c))	3 358	3 698
 	3 913	 	4 201 
Current
Security deposits	223	258
Loans to related parties (refer note (b), (c) and note 32)	9 001	9 000
Loan to employees (refer note (c))	903	682
 	10 127	 	9 940 
Notes:
(a) Non-current loans to related parties includes loan to key managerial personnel ` 7 lakhs (June 30, 2018: ` Nil lakhs).
(b) Current loans to related parties includes:
(i) Loan to fellow subsidiaries of the Ultimate Holding Company ` 9 000 lakhs (June 30, 2018: ` 9 000 lakhs).
(ii) Loan to key managerial personnel ` 1 lakh (June 30, 2018: ` Nil lakhs).
(c) Loans given to employees / key managerial personnel as per the CompanyÕs policy are not considered for the purposes of disclosure under Section 186 (4) of the Companies Act, 2013.
Notes to Financial Statements for the year ended June 30, 2019


7.	Other financial assets

As at

As at

Non-current
June 30, 2019
` in lakhs
June 30, 2018
` in lakhs
Bank deposits with remaining maturity more than 12 months
40
69
Interest accrued on deposits with banks
Ñ
19

 	40 
 	88 
Current


Receivable on account of sale of scrap
370
10
Due from related parties (refer note 32)
1 365
1 087
Interest accrued on loans to related parties (refer note 32)
609
1 347
Interest accrued on deposits with banks
87
49

 	2 431 
 	2 493 
8.	Inventories




Inventories (lower of cost and net realisable value)
        As at June 30, 2019
` in lakhs
        As at June 30, 2018
` in lakhs
Raw materials (Including packing materials)
7 374
3 055
Work-in-progress
867
130
Finished goods
7 721
4 238
Stock-in-trade {Includes in transit ` 208 lakhs (June 30, 2018 : ` 489 lakhs)}
3 195
3 642
Consumable stores and spares
1 185
1 296

 	20 342 
 	12 361 
The cost of inventories recognised as an expense during the year is disclosed in note 21, 22 and 25.
9(a). Cash and cash equivalents
For the purpose of the Statement of Cash Flows, cash and cash equivalents include cash in banks, net of outstanding bank overdrafts. Cash and cash equivalents at the end of the reporting year as shown in the Statement of Cash Flows can be reconciled to the related items in the Balance Sheet as follows:
        As at June 30, 2019
       
As at June 30, 2018
` in lakhs	` in lakhs
Balances with banks:
Ñ In current accounts	5 549	4 002
Ñ Deposits with original maturity of less than three months	47 041	35 233
Cash and cash equivalents as per Balance Sheet	 	52 590	 	39 235 
    Cash and cash equivalents as per Statement of Cash Flows	 	52 590	 	39 235 9(b). Other bank balances
        As at June 30, 2019
       
As at June 30, 2018
` in lakhs	` in lakhs
Earmarked accounts
Ñ Unpaid / Unclaimed dividend account	1 077	346
Ñ ISOP Account	157	229
  Ñ Other earmarked accounts (deposits with sales tax authorities)#		Ñ		Ñ Bank deposits with maturity more than 3 months but less than 12 months	221	149
 	1 455	 	724 
	
# denotes amount less than ` 50 000

Notes to Financial Statements for the year ended June 30, 2019


10.	Other assets

As at

As at

June 30, 2019
June 30, 2018

Non-current
` in lakhs
` in lakhs
Prepaid expenses
14
14
Advance to vendors
40
40
Balances with government authorities (refer note (a) below)


Unsecured, considered good
6 132
5 549
Unsecured, doubtful
1 292
1 276
Less: Allowance for doubtful advances
(1 292)
(1 276)

 	6 186 
 	5 603 
Current


Prepaid expenses
Ñ
2
Other advances (includes advances to vendors)
398
509
Advance to employees (refer note (b) below)
2
56
Balances with government authorities (includes Service Tax and Cenvat credit
1 497
1 287
receivable)



 	1 897 
 	1 854 

Movement in the allowance for doubtful advances

As at

As at

June 30, 2019
June 30, 2018

` in lakhs
` in lakhs
Balance at the beginning of year
1 276
1 062
Amounts written off during the year (net)
Ñ
Ñ
Change in allowance for bad and doubtful advances during the year
16
214
Balances at the end of year
 	1 292 
 	1 276 
(a) Includes amounts deposited with Excise, Sales Tax and other authorities pending resolution of disputes.
(b) Advances given to employees as per the CompanyÕs policy are not considered for the purposes of disclosure under Section 186 (4) of the Companies Act, 2013.
10(a). Non current assets held for sale

As at
As at

June 30, 2019
June 30, 2018

` in lakhs
` in lakhs
Freehold land
309
309
Buildings
840
840
Plant & machinery
946
946
Furniture and fixtures
32
32
Moulds & Dies
25
25

 	2 152 
 	2 152 
(a) In the previous year, certain Property, Plant and Equipment (PPE) had been rendered redundant due to the Company moving its manufacturing facility from one location to another. The company intends to dispose off the said PPE and is actively engaged in identifying a prospective buyer. The sale is expected to be completed in the next 12 months. These assets continue to be classified as held for sale as at June 30, 2019.
(b) Further, the carrying value of the said assets amounting to ` 3 411 lakhs was brought down to its fair value and an impairment loss of ` 1 259 lakhs has been recognised in the previous year.
Notes to Financial Statements for the year ended June 30, 2019
11. Equity share capital

        As at June 30, 2019

        As at June 30, 2018
` in lakhs	` in lakhs
Authorised share capital:

3 50 00 000 fully paid equity shares of ` 10 each
3 500

3 500
Issued and subscribed share capital:



3 24 60 736 fully paid equity shares of ` 10 each
3 246

3 246

3 246

3 246
11.1 Fully paid equity shares

Number of


Share

shares

Capital



` in lakhs
Balance at July 1, 2017
3 24 60 736

3 246
Movements
Ñ

Ñ
Balance at June 30, 2018
3 24 60 736

3 246
Movements
Ñ

Ñ
Balance at June 30, 2019
 3 24 60 736 

 	3 246 
The Company has only one class of equity shares having par value of ` 10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.
In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number  of equity shares held by the shareholders.
No shares are bought back by the Company during the period of 5 years immediately preceding the Balance Sheet date.
No shares are alloted as fully paid up by way of bonus shares during the period of 5 years immediately preceding the Balance Sheet date.
No shares are reserved for issue under options and contracts / commitments for the sale of shares / disinvestment.
No shares are alloted as fully paid up pursuant to contracts without being payment received in cash during the period of 5 years immediately preceding the Balance Sheet date.
11.2 Details of shares held by ultimate holding company / holding company and / or their subsidiaries / associates
        As at June 30, 2019
       
As at June 30, 2018
` in lakhs	` in lakhs
Ultimate Holding Company
The Procter & Gamble Company, USA	Ñ	Ñ
Holding Company
Procter & Gamble Overseas India BV, The Netherlands	2 231	2 231
Subsidiaries of the Ultimate Holding Company
Temple Trees Impex & Investment Pvt. Ltd.	62	62
11.3 Details of shareholders holding more than 5% equity shares in the Company
    As at June 30, 2019
    
As at June 30, 2018
Equity shares of ` 10 each fully paid
 
Number of shares held
% holding of equity shares
 
Number of shares held
% holding of equity shares
Procter & Gamble Overseas India BV, The Netherlands 2 23 10 090	68.73	2 23 10 090	68.73
Notes to Financial Statements for the year ended June 30, 2019


12.	Other equity

As at

As at

June 30, 2019
June 30, 2018

` in lakhs
` in lakhs
Reserves & surplus


General reserve
30 959
30 959
Securities premium
7 519
7 519
Share options outstanding account
1 749
1 331
Retained earnings
47 433
37 495

87 660
77 304

12.1 General reserve



        As at June 30, 2019
        As at June 30, 2018

` in lakhs
` in lakhs
Balance at the beginning of year
30 959
30 959
Transferred from surplus in Statement of Profit and Loss
Ñ
Ñ
Balance at the end of year
 	30 959 
 	30 959 

The general reserve is used from time to time to transfer profits from retained earnings for appropriation purposes. As the general reserve is created by a transfer from one component of equity to another and is not an item of other comprehensive income, items included in the general reserve will not be reclassified subsequently to the Statement of Profit and Loss.

12.2
Securities premium

As at

As at


June 30, 2019
June 30, 2018


` in lakhs
` in lakhs

Balance at the beginning of year
7 519
7 519

Movements
Ñ
Ñ

Balance at the end of year
7 519
7 519
The amount received in excess of face value of the equity shares is recognised in securities premium which is utilised in accordance with the provisions of the Companies Act, 2013.
12.3 Share options outstanding account

        As at June 30, 2019

        As at June 30, 2018
` in lakhs	` in lakhs
Balance at the beginning of year	1 331	791
Arising on share-based compensation	418	540
Balance at the end of year	1 749	1 331
The above reserve relates to share options granted by the Ultimate Holding Company to specific employees of its subsidiaries under its employee stock option plan. Further information about share-based payments to employees is set out in note 31.
Notes to Financial Statements for the year ended June 30, 2019


12.4
Retained earnings

As at

As at


June 30, 2019
June 30, 2018


` in lakhs
` in lakhs

Balance at the beginning of year
37 495
10 097

Profit attributable to the owners of the Company
41 913
37 459

Other comprehensive income arising from remeasurement of defined benefit
(667)
487

obligation (net of income tax)



Payment of final / interim dividend on equity shares (refer note 39)
(25 968)
(8 764)

Dividend distribution tax
(5 340)
(1 784)

Balance at the end of year
 	47 433 
 	37 495 
This Reserve represents the cumulative profits of the Company and effects of remeasurement of defined benefit obligations. This Reserve can be utilised in accordance with the provisions of the Companies Act, 2013.
In December 2018, final dividend for FY 2017-18 of ` 40 per share (total dividend including tax thereon ` 15 654 lakhs) was paid to holders of fully paid equity shares. In November 2017, the final dividend for FY 2016-17 paid was
` 27 per share (total dividend including tax thereon ` 10 548 lakhs).
In March 2019, an interim dividend for FY 2018-19 of ` 40 per share (total dividend including tax thereon ` 15 654 lakhs) was paid to holders of fully paid equity shares.
13. Other financial liabilities

As at
As at

June 30, 2019
June 30, 2018

` in lakhs
` in lakhs
Current


Finance lease obligation payable
209
209
Payables for property, plant and equipment
3 352
1 365
Deposits from customers and others
7
7
Unpaid / Unclaimed dividend#
1 077
346

 	4 645 
 	1 927 
# There are no amounts due for payment to the Investor Education and Protection Fund under Section 125 of the Act as at June 30, 2019 (Previous year: Nil).

14.
Provisions

As at

As at



Employee benefits (refer note (i) below)
June 30, 2019
` in lakhs
6 986
June 30, 2018
` in lakhs
5 300

Other provisions (refer note (ii) below)
100
Ñ


 	7 086 
 	5 300 

Current
536
427

Non-current
6 550
4 873


 	7 086 
 	5 300 
(i) The provision for employee benefits includes post retirement medical benefits (PRMB), compensated absences and gratuity. For other disclosures refer note 29.
(ii) Other provisions are in respect of the amount management estimates to incur to meet potential liabilities.
Other provisions

As at
As at

June 30, 2019
June 30, 2018

` in lakhs
` in lakhs
Balance at the beginning of year
Ñ
Ñ
Additional provision recognised
100
Ñ
Reduction arising from payments
Ñ
Ñ
Balance at the end of year
 	100 
 	Ñ 

Notes to Financial Statements for the year ended June 30, 2019
15. Deferred tax assets (Net)

        As at June 30, 2019

        As at June 30, 2018
` in lakhs	` in lakhs
Deferred tax assets	4 722	3 624
Deferred tax liabilities	(1 046)	(1 326)
 	3 676	 	2 298 
Deferred tax assets / (liabilities) in relation to:
2018-2019
Opening Balance
Recognised in profit or loss
   
Recognised in other comprehensive
income
Closing Balance
` in lakhs	` in lakhs	` in lakhs	` in lakhs
Property, plant and equipment	(1 326)	280	Ñ	(1 046)
Voluntary retirement scheme	543	(53)	Ñ	490
Disallowance u/s 43 B of the Income Tax Act, 1961	1 710	736	359	2 805
Other temporary differences	1 371	56	Ñ	1 427
 	2 298 	1 019	 	359 	3 676 
Recognised
2017-2018
Opening Balance
Recognised in profit or loss
      
in other comprehensive
income
Closing Balance
` in lakhs	` in lakhs	` in lakhs	` in lakhs
Property, plant and equipment	(797)	(529)	Ñ	(1 326)
Voluntary retirement scheme	471	72	Ñ	543
Disallowance u/s 43 B of the Income Tax Act, 1961	1 637	330	(257)	1 710
Other temporary differences	1 316	55	Ñ	1 371
 	2 627 	(72)	 	(257) 	2 298 
16. Trade payables

 

        As at June 30, 2019



        As at June 30, 2018
` in lakhs	` in lakhs
Dues to micro and small enterprises (refer note 36)	218	231
Dues to others	54 549	40 391
 	54 767	 	40 622 
17. Current tax liabilities (Net)
       
As at June 30, 2019
       
As at June 30, 2018
` in lakhs	` in lakhs
Income tax payable	2 614	10 419
 	2 614	 	10 419 
18. Other current liabilities

        As at June 30, 2019



        As at June 30, 2018
` in lakhs	` in lakhs
Superannuation	10	12
Advance received for transfer of leasehold land	Ñ	1 137
Taxes and other liabilities (including statutory remittances, excise and sales tax payable)
3 163	2 568
 	3 173	 	3 717 

	
Notes to Financial Statements for the year ended June 30, 2019


19.	Revenue from operations

Year ended

Year ended

June 30, 2019
June 30, 2018

` in lakhs
` in lakhs
Sale of products
2 94 248
2 45 522
Other operating revenues


Scrap sales
402
7

2 94 650
2 45 529


20.	Other Income



  Year ended June 30, 2019
  Year ended June 30, 2018

` in lakhs
` in lakhs
Interest income earned on:


Bank deposits
2 928
1 235
Loan to related parties (refer note 32)
794
770
Other financial assets carried at amortised cost
156
168

3 878
2 173
Other non-operating income (net of expenses directly attributable to such income)


Miscellaneous income
144
234
Income from transfer of leasehold land
1 312
Ñ

1 456
234
Total
5 334
2 407



21.
Cost of raw and packing materials consumed

Year ended

Year ended


June 30, 2019
June 30, 2018


` in lakhs
` in lakhs

Inventories at the beginning of year
3 055
2 090

Add: Purchases
99 383
55 448


1 02 438
57 538

Less: Inventories at the end of year
7 374
3 055

Cost of raw and packing materials consumed
95 064
54 483

Notes to Financial Statements for the year ended June 30, 2019
22.	Changes in inventories of finished goods, work-in-progress and stock-in-trade
  Year ended June 30, 2019

  Year ended June 30, 2018
` in lakhs	` in lakhs
Inventories at the beginning of year:


Finished Goods
4 238
9 868

Stock-in-Trade
3 642
4 169

Work-in-Progress
130
137


8 010
14 174

Inventories at the end of year:



Finished Goods
7 721
4 238

Stock-in-Trade
3 195
3 642

Work-in-Progress
867
130


11 783
8 010

Net (increase) / decrease
(3 773)
6 164

23.

Employee benefits expense




  Year ended June 30, 2019
  Year ended June 30, 2018


` in lakhs
` in lakhs

Salaries and wages*
11 137
9 584

Contribution to provident and other funds (refer note 29)
1 612
1 417

Share-based payment to employees (refer note 31)
840
831

Staff welfare expense
889
1 017

Recovery of employee cost cross charged by related parties (refer note 37)
(1 240)
(1 326)


13 238
11 523
* Salaries and Wages includes ` Nil lakhs (Previous year: ` 58 lakhs) for expenditure on Voluntary Retirement Scheme.


24.	Finance costs

Year ended

Year ended

June 30, 2019
June 30, 2018

` in lakhs
` in lakhs
Interest costs:


Interest expense on trade payables (refer note 36)
39
52
Interest on entry tax
101
116
Net interest on the net defined benefit liability (refer note 29)
381
354
Other interest expense
27
10

548
532
Notes to Financial Statements for the year ended June 30, 2019


25.	Other expenses

Year ended

Year ended

June 30, 2019
June 30, 2018

` in lakhs
` in lakhs
Consumption of store and spares
774
668
Processing charges
13 557
8 017
Power and fuel
1 248
1 182
Freight, transport, warehousing and distribution charges
6 891
6 346
Rent
6 238
4 329
Rates and taxes
436
(123)
Insurance
27
37
Repairs and maintenance


Plant and machinery
479
423
Others
168
130
Trade incentives
1 832
1 814
Advertising expenses
29 499
24 238
Royalty
15 723
11 972
Business process outsourcing expenses
6 314
4 294
Travelling and conveyance
1 524
1 640
Communication costs
421
362
Computer expenses
392
316
Legal and professional fees
3 415
3 119
Directors commission
66
51
Payment to auditors (refer note 25.1)
120
108
Exchange differences (net)
(182)
743
Inventory written off (net of insurance claims recovered)
824
509
Allowance for doubtful receivables
95
1
Loss on sale of property, plant and equipment (net)
767
613
Miscellaneous expenses
6 718
5 900
Recovery of Expenses shared by related parties (refer note 37)
(345)
(350)

 	97 001
 	76 339

25.1 Payments to auditors:



  Year ended June 30, 2019
  Year ended June 30, 2018

` in lakhs
` in lakhs
(i) To statutory auditors


For audit
89
81
For other services
18
16
Reimbursement of expenses
5
3
(ii) To cost auditors for cost audit
8
8

 	120
 	108

Notes to Financial Statements for the year ended June 30, 2019

25.2 Corporate Social Responsibility


  Year ended June 30, 2019


  Year ended June 30, 2018

The Company has spent towards various schemes of Corporate Social Responsibility as prescribed under section 135 of the Companies Act, 2013. This amount corresponds with the gross amount required to be spent by the company during the year.
` in lakhs	` in lakhs
1 274	1 220
(i) Amount spent for purposes of Construction/ acquisition of asset	Ñ	Ñ
(ii) Amount spent for purposes other than (i) above	1 274	1 220
None of the above amount spent is through any related party / affiliate. The Company does not carry any provisions for Corporate Social Responsibility expenses for current year and previous year.

26. Income tax expense
26.1 Income tax recognised in Statement of Profit and Loss


Year ended


Year ended

June 30, 2019
June 30, 2018

` in lakhs
` in lakhs
Current tax


In respect of the current year
22 185
20 646
In respect of prior years
(2 346)
Ñ

19 839
20 646
Deferred tax


In respect of the current year
(1 019)
685
In respect of prior years
Ñ
(613)

(1 019)
72
Total income tax expense recognised in the current year
18 820
20 718

The income tax expense for the year can be reconciled to the accounting profit as follows:


Year ended
Year ended

June 30, 2019
June 30, 2018

` in lakhs
` in lakhs
Profit before tax
 	60 733
 	58 177
Income tax expense calculated at 34.944% (2017-2018: 34.692%)
21 223
20 183
Effect of expenses that are not deductible in determining taxable profits
(57)
1 148

21 166
21 331
Adjustments recognised in the current year in relation to the current tax of prior years
(2 346)
(613)
Income tax expense recognised in Statement of Profit and Loss
18 820
20 718
The tax rate used for 2018-19 is the corporate tax rate of 34.944%. The tax rate used for 2017-18 is a weighted average of the corporate tax rate of 34.608% applicable till March 31, 2018 and 34.944% applicable from        April 1, 2018 under the Indian laws.
Notes to Financial Statements for the year ended June 30, 2019


26.2 Income tax recognised in other comprehensive income

Year ended

Year ended

June 30, 2019
June 30, 2018

` in lakhs
` in lakhs
Deferred tax


Arising on expense recognised in other comprehensive income


Remeasurement of defined benefit obligations
(359)
257

(359)
257
Total income tax recognised in other comprehensive income not to be reclassified to Statement of Profit and Loss
(359)
257
27.	Segment information


27.1 Products from which reportable segments derive their revenues


Information reported to the chief operating decision maker (CODM) for the purposes of resource allocation and assessment of segment performance focuses on the types of goods delivered or provided. The directors of the Company have chosen to organise the Company around differences in products and services.
Specifically, the CompanyÕs operating segments under Ind AS 108 are as follows:
Ð Health care products - Comprising of Ointment and Creams, Cough Drops and Tablets.
Ð Hygiene products - Comprising of Feminine Hygiene products and other skin care hygiene products.
For financial statements presentation purposes, these individual operating segments have been aggregated into a single primary reportable segment i.e. manufacturing, trading and marketing of Health and Hygiene Products under Ind AS 108 taking into the account the following factors:
Ð these operating segments have similar economic characteristics;
Ð these operating segments have similar long-term gross profit margins;
Ð the nature of the products and production processes are similar; and
Ð the methods used to distribute the products to the customers are the same.

27.2 Segment revenues and results
Segment revenue	Segment profit


Year ended
Year ended
Year ended
Year ended

June 30, 2019
` in lakhs
June 30, 2018
` in lakhs
June 30, 2019
` in lakhs
June 30, 2018
` in lakhs
Health and hygiene
2 94 650
2 45 529
55 947
56 302
Total operations
2 94 650
2 45 529
55 947
56 302
Other income


5 334
2 407
Finance costs


(548)
(532)
Profit before tax


60 733
58 177
Segment revenue reported above represents revenue generated from external customers.
The accounting policies of the reportable segments are the same as the CompanyÕs accounting policies described in note 2.3(o). Segment profit represents the profit before tax earned by each operating segment, other income as well as finance costs. This is the measure reported to the chief operating decision maker for the purpose of resource allocation and assessment of segment performance.

Notes to Financial Statements for the year ended June 30, 2019
27.3 Segment assets and liabilities

        As at June 30, 2019

        As at June 30, 2018
` in lakhs	` in lakhs
Segment assets
Health and hygiene	1 63 191	1 42 535
Total segment assets	 1 63 191	 1 42 535
Segment liabilities
Health and hygiene	72 285	61 985
Total segment liabilities	 	72 285	 	61 985
27.4 Other segment information
Depreciation expense	Capital Expenditure

Year ended
Year ended
Year ended
Year ended

June 30, 2019
June 30, 2018
June 30, 2019
June 30, 2018

Health and hygiene
` in lakhs
4 978
` in lakhs
5 237
` in lakhs
1 610
` in lakhs
3 494

 	4 978
 	5 237
 	1 610
 	3 494
27.5 Revenue from major products
The following is an analysis of the CompanyÕs revenue from continuing operations from its major products.


Year ended
Year ended

June 30, 2019
` in lakhs
June 30, 2018
` in lakhs
Ointments and Creams
52 145
45 604
Cough Drops
29 516
27 833
Tablets
5 785
5 186
Other hygiene products
2 07 204
1 66 906

   2 94 650
   2 45 529

27.6 Geographical information
The Company operates in two principal geographical areas - India (country of domicile) and outside India.
The CompanyÕs revenue from external customers by location of operations and information about its segment assets by location of assets are detailed below.
Revenue from external customers
Segment assets


Year ended
Year ended
As at
As at


India
June 30, 2019
` in lakhs
2 90 661
June 30, 2018
` in lakhs
2 42 094
June 30, 2019
` in lakhs
1 63 191
June 30, 2018
` in lakhs
1 42 535
Outside India
3 989
3 435
Ñ
Ñ

2 94 650
2 45 529
1 63 191
1 42 535
There is no transactions with single external customer which amounts to 10% or more of the CompanyÕs revenue.
Notes to Financial Statements for the year ended June 30, 2019


28.	Earnings per share

Year ended

Year ended

June 30, 2019
June 30, 2018

` per share
` per share
Basic and diluted earnings per share


Total basic earnings per share (face value ` 10)
129.12
115.40
Total diluted earnings per share (face value ` 10)
129.12
115.40
28.1 Basic and Diluted earnings per share


The earnings and weighted average number of equity shares used in the calculation of basic and diluted earnings per share are as follows:
  Year ended June 30, 2019
  
Year ended June 30, 2018
` in lakhs	` in lakhs
Earnings used in calculation of basic and diluted earnings per share from
operations	 	41 913	 	37 459


Weighted average number of equity shares for the purposes of basic and
  
Year ended June 30, 2019
  
Year ended June 30, 2018
diluted earnings per share	 3 24 60 736 3 24 60 736
29. Employee benefit plans
29.1 Defined contribution plans
The Company operates defined contribution provident fund, superannuation fund and employeesÕ state insurance plan for all qualifying employees of the Company. Where employees leave the plan, the contributions payable by the Company is reduced by the amount of forfeited contributions.
The employees of the Company are members of a state-managed employerÕs contribution to employeesÕ state insurance plan, provident fund operated by the government and superannuation fund which is administered through a trust that is legally separated from the Company. The assets of the plan is held separately from those of the Company in funds under the control of trustees. The Company is required to contribute a specific percentage of payroll costs to the contribution schemes to fund the benefit. The only obligation of the Company with respect to the contribution plan is to make the specified contributions.
The total expense recognised in the statement of profit and loss of ` 1 003 lakhs (for the year ended June 30, 2018:
` 843 lakhs) for provident fund, ` 120 lakhs (for the year ended June 30, 2018: ` 136 lakhs) for superannuation fund represent contributions payable to these plans by the Company at rates specified in the rules of the plans.  As at June 30, 2019, contributions of ` 10 lakhs (as at June 30, 2018: ` 12 lakhs) due in respect of 2018-2019 (2017-2018) reporting period had not been paid over to the plans. The amounts were paid subsequent to the end of the reporting periods.

29.2 Defined benefit plans
a) Gratuity Plan (Funded)
The Company sponsors funded defined benefit gratuity plan for all eligible employees of the Company. The CompanyÕs defined benefit gratuity plan is a final salary plan for India employees, which requires contributions to be made to a separately administered trust. The gratuity plan is governed by the Payment of Gratuity Act, 1972. Under the act, employee who has completed five years of service is entitled to specific benefit. The level of benefits provided depends on the memberÕs length of service and salary at retirement age. The gratuity plan is administered by a separate trust that is legally separated from the Company. The board of the trust is composed of representatives from both employer and employees. The board of the trust is required by law and by its articles of association to act in the interest of the trust and of all relevant stakeholders in the scheme, i.e. active employees, inactive employees, retirees, employer. The board of the trust is responsible for the investment policy with regard to the assets of the trust.

Notes to Financial Statements for the year ended June 30, 2019

b) Post Retirement Medical Benefit (PRMB) (Unfunded)
The Company provides certain post-employment medical benefits to employees. Under the scheme, employees get medical benefits subject to certain limits of amount, periods after retirement and types of benefits, depending on their grade at the time of retirement. Employees separated from the Company as part of early separation scheme are also covered under the scheme. The liability for post retirement medical scheme is based on an independent actuarial valuation.
c) Compensated absences for Plant technicians (Unfunded)
The Company also provides for compensated absences for plant technicians which allows for encashment of leave on termination/retirement of service or leave with pay subject to certain rules. The employees are entitled to accumulate leave subject to certain limits for future encashment / availment. The Company makes provision for compensated absences based on an actuarial valuation carried out at the end of the year.
These plans typically expose the Company to actuarial risks such as: Investment risk, interest rate risk, longevity risk and salary risk.

Investment risk
The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds.
Interest risk
A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase in the return on the plan investments.
Longevity risk
The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality rate of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plans liability.
Salary risk
The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. As such, an increase on the salary of plan participants will increase the plans liability.
In respect of the plans, the most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation were carried out as at June 30, 2019. The present value of the defined benefit obligation, and the related current service cost and past service cost, were measured using the projected unit credit method.

A. The principal assumptions used for the purposes of the actuarial valuations were as follows:
Valuations as at


Discount rate
June 30, 2019
June 30, 2018
Gratuity plan (funded)
7.00%
8.00%
Compensated absence plan (unfunded)
7.00%
8.00%
Post retirement medical benefit (PRMB) (unfunded)
7.00%
8.00%
Expected rate of salary increase


Gratuity plan (funded)
9.00%
9.00%
Compensated absence plan (unfunded)
9.00%
9.00%
Post retirement medical benefit (PRMB) (unfunded)
NA
NA
Medical Inflation Rate


Post retirement medical benefit (PRMB) (unfunded)
5.50%
5.50%
Average longevity at retirement age for current beneficiaries of the plan (years)


Post retirement medical benefit (PRMB) (unfunded)
11.85
13.17
Demographic Assumptions


Mortality in Service: Indian Assured Lives Mortality (2006-08) Ultimate table


Mortality in Retirement: LIC Annuity Rates (1996-98) Ultimate table
Notes to Financial Statements for the year ended June 30, 2019

B. Amounts recognised in the Statement of Profit and Loss in respect of these defined benefit plans are as follows:

Year ended
June 30, 2019
Year ended
June 30, 2018

` in lakhs
` in lakhs
Gratuity Plan (Funded)


Service costs:
Current service cost

489

438
Net interest expense
347
323
Components of defined benefit costs recognised in statement of profit and loss (A)
836
761
Remeasurement on the net defined benefit liability:
Return on plan assets (excluding amounts included in net interest

18

(84)
expense)
Actuarial (gains) / losses arising from changes in assumptions

971

(704)
Actuarial (gains) / losses arising from changes in experience
(9)
(11)
adjustments


Components of defined benefit costs recognised in other comprehensive income (B)
980
(799)
Total (C = (A+B))
 	1 816
 	(38)
Compensated absence plan (Unfunded)
Service costs:
Current service cost


15


19
Net interest expense
12
10
Immediate recognition of (gains) / losses Ð other long term employee
28
(29)
benefit plans


Components of defined benefit costs recognised in statement
55
Ñ
of profit and loss (D)
 	
 	
Post retirement medical benefit (PRMB) (Unfunded)
Service costs:
Current service cost


3


12
Net interest expense
22
21
Components of defined benefit costs recognised in statement
25
33
of profit and loss (E)
 	
 	
Remeasurement on the net defined benefit liability:
Actuarial (gains) / losses arising from changes in assumptions

34

(29)
Actuarial (gains) / losses arising from changes in experience
12
84
adjustments


Components of defined benefit costs recognised in other
46
55
comprehensive income (F)
 	
 	
Total (G = (E+F))
 	71
 	88
Total defined benefit costs recognised in Statement of Profit
916
794
and Loss
Total defined benefit costs recognised in Other Comprehensive

1 026

(744)
Income


The current service cost for the year are included in the ÔEmployee benefits expenseÕ line item in the Statement of Profit and Loss.
The net interest expenses for the year are included in the ÔFinance costsÕ line item in the Statement of Profit and Loss.
The remeasurement of the net defined benefit liability is included in Other Comprehensive Income.

Notes to Financial Statements for the year ended June 30, 2019

C. The amount included in the Balance Sheet arising from the entityÕs obligation in respect of its defined benefit plans is as follows:


As at
As at

June 30, 2019
` in lakhs
June 30, 2018
` in lakhs
Gratuity Plan (Funded)


Present value of funded defined benefit obligation
7 029
5 512
Fair value of plan assets
(999)
(1 048)
Net liability arising from defined benefit obligation
6 030
4 464

Compensated absence plan (Unfunded)


Present value of funded defined benefit obligation
201
147
Net liability arising from defined benefit obligation
201
147

Post retirement medical benefit (PRMB) (Unfunded)


Present value of funded defined benefit obligation
344
284
Net liability arising from defined benefit obligation
344
284
D. Movement in the present value of the defined benefit obligation are as follows:
  Year ended June 30, 2019

  Year ended June 30, 2018
` in lakhs	` in lakhs
Gratuity Plan (Funded)
Opening defined benefit obligation
5 512
5 753
Current service cost
489
438
Interest cost
426
389
Remeasurement on the net defined benefit liability:


Actuarial (gains) / losses arising from changes in assumptions
971
(704)
Actuarial (gains) / losses arising from changes in experience adjustments
(9)
(11)
Benefits paid
(360)
(353)
Closing defined benefit obligation
 	7 029
 	5 512
Compensated absence plan (Unfunded)


Opening defined benefit obligation
147
147
Current service cost
15
19
Interest cost
12
10
Immediate recognition of (gains) / losses Ð other long term employee benefit plans
28
(29)
Benefits paid
(1)
Ñ#
Closing defined benefit obligation
 	201
 	147
# denotes amount less than ` 50 000
Notes to Financial Statements for the year ended June 30, 2019



  Year ended June 30, 2019
  Year ended June 30, 2018

` in lakhs
` in lakhs
Post retirement medical benefit (PRMB) (Unfunded)
Opening defined benefit obligation

284

307
Current service cost
3
12
Interest cost
22
21
Remeasurement on the net defined benefit liability:
Actuarial (gains) / losses arising from changes in assumptions

34

(29)
Actuarial (gains) / losses arising from changes in experience
adjustments
12
84
Past service cost - plan amendments
Ñ
(94)
Benefits paid
(11)
(17)
Closing defined benefit obligation
 	344
 	284
E. Movement in the fair value of the plan assets are as follows:

Year ended

Year ended

Gratuity Plan
June 30, 2019
` in lakhs
June 30, 2018
` in lakhs
Opening fair value of plan assets
1 048
1 001
Interest Income
79
66
Remeasurement gain / (loss):
Return on plan assets (excluding amounts included in net interest

(18)

84
expense)
Employer contributions

250

250
Benefits paid
(360)
(353)
Closing fair value of plan assets
 	999
 	1 048
F.	The fair value of the plan assets for plan at the end of the reporting year for each category, are as follows:
Gratuity Plan

As at
As at

June 30, 2019
June 30, 2018

` in lakhs
` in lakhs
High quality Corporate Bonds (including Public Sector Unit)
346
379
Government of India Securities (Central and State)
136
133
Cash (including Special Deposit Scheme)
502
408
Private Sector Unit
15
128
Total
 	999
 	1 048
The fair values of the above equity and debt instruments are determined based on quoted market prices in active markets.
Expected employer contributions for the period ending June 30, 2020 is ` Nil lakhs (for the year ended June 30, 2019: ` Nil lakhs).
The actual return on plan assets was ` 61 lakhs (for the year ended June 30, 2018: ` 150 lakhs).
Maturity profile of defined benefit obligation:
Gratuity Plan
` in lakhs
Within 1 year
212
1 - 2 year
271
2 - 3 year
341
3 - 4 year
314
4 - 5 year
369
5 - 10 years
2 367

Notes to Financial Statements for the year ended June 30, 2019

Significant actuarial assumptions of the determination of the defined obligation are discount rate, expected salary increase and mortality. The sensitivity analyses below have been determined based on reasonable possible changes of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant.
Gratuity Plan (Funded)
If the discount rate is 50 basis points higher (lower), the defined benefit obligation would decrease by ` 459 lakhs (increase by ` 505 lakhs) (as at June 30, 2018: decrease by ` 309 lakhs (increase by ` 336 lakhs)).
If the expected salary growth increases (decreases) by 0.5%, the defined benefit obligation would increase by
` 489 lakhs (decrease by ` 451 lakhs) (as at June 30, 2018: increase by ` 331 lakhs (decrease by ` 307 lakhs)).
Compensated absence plan (Unfunded)
If the discount rate is 50 basis points higher (lower), the defined benefit obligation would decrease by ` 16 lakhs (increase by ` 18 lakhs) (as at June 30, 2018: decrease by ` 10 lakhs (increase by ` 12 lakhs)).
If the expected salary growth increases (decreases) by 0.5%, the defined benefit obligation would increase by
` 17 lakhs (decrease by ` 16 lakhs) (as at June 30, 2018: increase by ` 11 lakhs (decrease by ` 10 lakhs)).
Post retirement medical benefit (PRMB)
If the discount rate is 50 basis points higher (lower), the defined benefit obligation would decrease by ` 17 lakhs (increase by ` 18 lakhs) (as at June 30, 2018: decrease by ` 13 lakhs (increase by ` 14 lakhs)).
If the expected medical inflation rate increases (decreases) by 0.5%, the defined benefit obligation would increase by
` 16 lakhs (decrease by ` 15 lakhs) (as at June 30, 2018: increase by ` 12 lakhs (decrease by `11 lakhs)).
The sensitivity analysis presented above may not be representative of the actual change of the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.
Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected unit credit method as the end of the reporting period, which is the same as that applied in calculating the defined benefit obligation liability recognised in the Balance Sheet.
There was no change in the methods and assumptions used in preparing the sensitivity analysis from prior years.
30. Financial instruments
30.1 Capital management
The Company manages its capital to ensure that it will be able to continue as going concerns while maximising the return to stakeholders through the optimisation of the equity balance. Equity share capital and other equity are considered for the purpose of groupÕs capital management.
The Company is not subject to any externally imposed capital requirements.
The CompanyÕs risk management committee manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return on capital to shareholders or issue new shares.
30.2 Categories of financial instruments

As at
June 30, 2019
As at
June 30, 2018

Financial assets
` in lakhs
` in lakhs
Measured at amortised cost
(a)	Trade receivables

18 066

14 847
(b)	Cash and cash equivalents
52 590
39 235
(c)	Bank balances other than (b) above
1 455
724
(d)	Loans
14 040
14 141
(e)	Other financial assets
2 471
2 581
Financial liabilities Measured at amortised cost
(a)	Trade payables
54 767
40 622
(b)	Other financial liabilities
4 645
1 927
Notes to Financial Statements for the year ended June 30, 2019

30.3 Financial risk management objectives
The CompanyÕs overall policy with respect to managing risks associated with financial instruments is to minimise potential adverse effects of financial performance of the Company. The policies for managing specific risks are summarised below.
30.4 Foreign currency risk management
The Company undertakes transactions denominated in foreign currencies; consequently, exposures to exchange rate fluctuations arise. Exchange rate exposures are managed within approved policy parameters.
The carrying amounts of the CompanyÕs foreign currency denominated monetary assets and monetary liabilities at the end of the reporting period are as follows:
Liabilities as at	Assets as at
As at
As at
As at
As at

June 30, 2019
` in lakhs
June 30, 2018
` in lakhs
June 30, 2019
` in lakhs
June 30, 2018
` in lakhs
USD
15 948
10 749
456
1 478
EUR
3 159
1 104
8
4
CNY
5
2
7
Ñ
EGP
Ñ
Ñ
Ñ
4
SGD
16
7
Ñ
Ñ
GBP
Ñ´
Ñ
Ñ
Ñ
30.4.1 Foreign currency sensitivity analysis
The Company is mainly exposed to the currencies stated above.
The following table details impact to profit or loss of the Company by sensitivity analysis of a 10% increase and decrease in the respective currencies against the functional currency of the Company. 10% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents managementÕs assessment of the reasonably possible changes in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 10% change on foreign currency rates.
If the relevant foreign currency strengthens / weakens by 10% against the functional currency of the Company, profit or loss will increase / (decrease) by:

Increase / (decrease) at +10%
As at	As at
Increase / (decrease) at -10% As at	As at

June 30, 2019	June 30, 2018
June 30, 2019	June 30, 2018

` in lakhs	` in lakhs
` in lakhs	` in lakhs
USD
(1 549)	(927)
1 549	927
EUR
(315)	(110)
315	110
CNY
Ñ´	Ñ´
Ñ´	Ñ´
EGP
Ñ	Ñ´
Ñ	Ñ´
SGD
(2)	(1)
2	1
GBP
Ñ´	Ñ
Ñ´	Ñ
´ denotes amount less than ` 50 000


30.5 Credit risk management
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. The Company performs ongoing credit evaluation of the counterpartyÕs financial position as a means of mitigating the risk of financial loss arising from defaults. The Company only grants credit to creditworthy counterparties.
The Company does not have any significant credit risk exposure to any single counterparty or any group of counterparties having similar characteristics as disclosed in Note 5 to the financial statements.
30.6 Interest rate risk management
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Since the Company does not have interest bearing borrowings, it is not exposed to risk of changes in market interest rates. The Company has not used any interest rate derivatives.

Notes to Financial Statements for the year ended June 30, 2019

30.7 Other price risk management
Other price risk is the risk that the fair value of a financial instrument will fluctuate due to changes in market  traded price. The Company is not exposed to pricing risk as the Company does not have any investments in equity instruments and bonds.
30.8 Liquidity risk management
Liquidity risk is the risk that the Company will encounter difficulty in raising funds to meet commitments associated with financial instruments that are settled by delivering cash or another financial asset. Liquidity risk may result from an inability to sell a financial asset quickly at close to its fair value. The Company maintains adequate highly liquid assets in the form of cash to ensure necessary liquidity.
The table below analyse financial liabilities of the Company into relevant maturity groupings based on the reporting period from the reporting date to the contractual maturity date:


Less than
1 year
` in lakhs
   Between 1 to 5 years
` in lakhs
  Over 5 years
` in lakhs

Total
` in lakhs
Carrying
Value
` in lakhs
At June 30, 2019





Trade Payables
54 767
Ñ
Ñ
54 767
54 767
Other financial liabilities
4 645
Ñ
Ñ
4 645
4 645
Provisions
536
6 550
Ñ
7 086
7 086
Other Current Liabilities
At June 30, 2018
3 173
Ñ
Ñ
3 173
3 173
Trade Payables
40 622
Ñ
Ñ
40 622
40 622
Other financial liabilities
1 927
Ñ
Ñ
1 927
1 927
Provisions
427
4 873
Ñ
5 300
5 300
Other Current Liabilities
3 717
Ñ
Ñ
3 717
3 717
30.9 Fair value measurements
The carrying amount of financial assets and financial liabilities measured at amortised cost in the financial statements are a reasonable approximation of their fair values since the Company does not anticipate that the carrying amounts would be significantly different from the values that would eventually be received or settled.
31. Share-based payments
a) International Stock Ownership Plan (Stocks of the Ultimate Holding Company)
The Procter and Gamble Company, USA has an ÒInternational Stock Ownership PlanÓ (employee share purchase plan) whereby specified employees of its subsidiaries have been given a right to purchase shares of the Ultimate Holding Company i.e. The Procter and Gamble Company, USA. Every employee who opts for the scheme contributes by way of payroll deduction up to a specified percentage (upto 15%) of base salary towards purchase of shares on a monthly basis. The Company contributes 50% of employeeÕs contribution (restricted to 2.5% of his base salary). Such contribution is charged under employee benefits expense.
The shares of The Procter & Gamble Company, USA are listed with New York Stock Exchange and are purchased on behalf of the employees at market price on the date of purchase. During the year ended June 30, 2019,    6 384.23 (June 30, 2018: 4 651.17) shares were purchased by employees at weighted average fair value of
` 6 490.09 (June 30, 2018: ` 5 482.49) per share. The CompanyÕs contribution during the year on such purchase of shares amounting to ` 109 lakhs (June 30, 2018: ` 97 lakhs) has been charged under employee benefits expense under Note 23.
b) Employees Stock Options Plan (Stocks of the Ultimate Holding Company)
The Procter and Gamble Company, USA has an ÒEmployee Stock Option PlanÓ whereby specified employees of its subsidiaries covered by the plan are granted an option to purchase shares of the Ultimate Holding Company
i.e. The Procter and Gamble Company, USA at a fixed price (grant price) for a fixed year of time. The shares of The Procter & Gamble Company, USA are listed with New York Stock Exchange. The Options Exercise price equal to the market price of the underlying shares on the date of the grant. The Grants issued are vested after 3 years and have a 5/10 years life cycle.
Notes to Financial Statements for the year ended June 30, 2019

The expense recognised for employee services received during the year is shown in the following table:


As at
As at

June 30, 2019
June 30, 2018

Expense arising from equity-settled share-based payment transactions
` in lakhs
731
` in lakhs
734
Total expense arising from share-based payment transactions
 	731
 	734
There were no cancellations or modifications to the awards in June 30, 2019 or June 30, 2018.
Movements during the year
The following table illustrates the number and weighted average exercise prices (WAEP) of, and movements in, share options during the year (excluding SARs):



As at

As at
Estimated
fair value

As at

As at
Estimated
fair value

June 30,
June 30,
of Option
June 30,
June 30,
of Option

2019
2019
Granted
2018
2018
Granted

Number
WAEP (in $)
In `
Number
WAEP (in $)
In `
Outstanding at July 1
2 64 990
78.06
Ñ
2 32 984
87.05
Ñ
Granted during the year
04-Sep-18

1 210

82.70

5 828

Ñ

Ñ

Ñ
14-Sep-18
1 242
83.61
804
Ñ
Ñ
Ñ
02-Jan-19
1 096
91.28
6 432
Ñ
Ñ
Ñ
28-Feb-19
20 222
98.55
994
Ñ
Ñ
Ñ
28-Feb-19
4 876
98.55
1 056
Ñ
Ñ
Ñ
28-Feb-19
6 334
98.55
6 944
Ñ
Ñ
Ñ
28-Feb-19
988
98.55
8 063
Ñ
Ñ
Ñ
03-Aug-17
Ñ
Ñ
Ñ
551
88.40
5 740
15-Sep-17
Ñ
Ñ
Ñ
5 639
93.27
672
28-Feb-18
Ñ
Ñ
Ñ
2 098
78.52
5 004
28-Feb-18
Ñ
Ñ
Ñ
4 394
78.52
4 786
28-Feb-18
Ñ
Ñ
Ñ
53 685
78.52
775
Forfeited during the year
(33 590)
Ñ
Ñ
(3 446)
Ñ
Ñ
Exercised during the year
(57 016)
95.27
Ñ
(30 915)
87.70
Ñ
Expired during the year
Ñ
Ñ
Ñ
Ñ
Ñ
Ñ
Outstanding at June 30
   2 10 352
109.65

   2 64 990
78.06

Exercisable at June 30
41 745
109.65

1 18 842
78.06

The weighted average share price at the date of exercise of these options was $ 95.27 (June 30, 2018: $ 87.70). The weighted average remaining contractual life for the share options outstanding as at June 30, 2019 was
6.85 years (June 30, 2018: 5.99 years).
The weighted average fair value of options granted during the year was ` 2 566 (June 30, 2018: ` 1 206).
These fair values for share options granted during the year were calculated using binomial lattice-based model. The following tables list the inputs to the models used for the plans for the years ended June 30, 2019 and June 30, 2018, respectively:


As at
As at

June 30, 2019
June 30, 2018
Dividend yield (%)
3.03%
3.12%
Expected volatility (%)
16.56%
17.92%
RiskÐfree interest rate (%)
2.60%
2.82%

Notes to Financial Statements for the year ended June 30, 2019

32. Related party disclosures:
The Group Companies of The Procter & Gamble Company USA include, among others, Procter & Gamble India Holdings BV	Procter & Gamble Luxembourg Global SARL Procter & Gamble Iron Horse Holding BV	Procter & Gamble International SARL Procter & Gamble Eastern Europe LLC	Procter & Gamble India Holdings Inc.
Procter & Gamble Nordic LLC	Procter & Gamble International Operations, SA Procter & Gamble Global Holdings Limited	Gillette Group (Europe) Holdings, BV
Procter & Gamble Canada Holding BV	Procter & Gamble Overseas India BV Procter & Gamble Overseas Canada, BV	Procter & Gamble Asia Holding BV Rosemount BV
(a) Related party where control exists:

Relationship
Name of the Company
Ultimate Holding Company
The Procter & Gamble Company, USA
Holding Company
Procter & Gamble Overseas India BV, The Netherlands

(b) Other parties with whom transactions have taken place during the year.
(i) Fellow Subsidiaries

S. No.
Name of the Company
S. No.
Name of the Company
1.
Gillette India Limited
18.
Procter & Gamble Services Company Nv
2.
Procter & Gamble Home Products Private
19.
Procter & Gamble Technical Centers Ltd.

Limited


3.
Procter & Gamble (Guangzhou) Ltd.
20.
Procter & Gamble Trading (Thailand) Ltd.
4.
Procter & Gamble Australia Pty Ltd.
21.
Procter & Gamble Middle East Fze
5.
Procter & Gamble Egypt
22.
Pt. Procter & Gamble Home Products



Indonesia
6.
Procter & Gamble Europe Sa
23.
The Procter & Gamble US Business



Services Company
7.
Procter & Gamble Europe Sa Singapore Branch
24.
Procter & Gamble Manufacturing Gmbh
8.
Procter & Gamble Hong Kong Limited
25.
Procter & Gamble Bangladesh Private



Limited
9.
Procter & Gamble International Operations
26.
The Procter & Gamble Distributing LLC

S.A. Dubai Branch


10.
Procter & Gamble International Operations Sa
27.
Fameccanica Data S.P.A.
11.
Procter & Gamble International Operations Sa
28.
Fameccanica Machinery (Shanghai) Co Ltd

Singapore Branch


12.
Procter & Gamble International Operations
29.
Wella India Hair Cosmetics Pvt. Ltd.

Sa-Rohq


13.
Procter & Gamble Japan K.K.
30.
Procter & Gamble Gulf Fze
14.
Procter & Gamble Korea S&D, Co.
31.
Procter & Gamble Services Ltd.
15.
Procter & Gamble Korea, Inc.
32.
Pt. Procter & Gamble Operations Indonesia
16.
Procter & Gamble Philippines, Inc.
33.
Gillette Diversified Operations Pvt Ltd
17.
Procter & Gamble Service Gmbh
Notes to Financial Statements for the year ended June 30, 2019

(ii) Key Management Personnel of the Company:

S. No.
Name
Designation
1.
Mr. Madhusudan Gopalan
Managing Director w.e.f. July 1, 2018
2.
Mr. Al Rajwani
Managing Director upto June 30, 2018
3.
Mr. Karthik Natarajan
Non-executive Director
4.
Ms. Sonali Dhawan
Non-executive Director
5.
Mr. Pramod Agarwal
Non-executive Director
6.
Mr. Shailyamanyu Singh Rathore
Non-executive Director upto May 8, 2019
7.
Mr. Gagan Sawhney
Non-executive Director w.e.f. January 24, 2019
8.
Mr. Ghanashyam Hegde
Non-executive Director w.e.f. May 9, 2019
9.
Mr. Prashant Bhatnagar
Chief Financial Officer
Note: Related parties have been identified by the management.

(c) Details of related party transactions between the Company and its related parties are as under:
` in lakhs
S. No.
Nature of Transactions
    For the year ended
June 30
Ultimate Holding
& Holding Company
    Fellow Subsidiary Companies
        Key Managerial Personnel
1.
Purchase of Goods
2019
514
16 130
Ñ


2018
339
2 161
Ñ
2.
Purchase of Equipment / Assets /
2019
Ñ
695
Ñ

Spares
2018
Ñ
1 145
Ñ
3.
Sale of Products
2019
Ñ
756
Ñ


2018
Ñ
602
Ñ
4.
Sale of Capital goods
2019
Ñ
54
Ñ


2018
Ñ
82
Ñ
5.
Loans Given
2019
Ñ
9 000
Ñ


2018
Ñ
9 000
Ñ
6.
Loans Realised
2019
Ñ
9 000
Ñ


2018
Ñ
9 000
23
7.
Interest Income
2019
Ñ
794
Ñ


2018
Ñ
770
Ñ
8.
Recovery of Expenses Cross charged
2019
530
4 070
Ñ


2018
675
2 798
Ñ
9.
Expenses cross-charged
2019
407
1 805
Ñ


2018
365
2 290
Ñ
10.
Reimbursement of expenses shared
2019
Ñ
1 943
Ñ

by group cos. (Income)
2018
Ñ
2 210
Ñ
11.
Reimbursement of expenses shared
2019
Ñ
73
Ñ

by group cos. (Expense)
2018
Ñ
268
Ñ
12.
Business Process Outsourcing
2019
5 183
842
Ñ

expenses
2018
3 831
643
Ñ
13.
Royalty
2019
14 307
Ñ
Ñ


2018
12 190
Ñ
Ñ

Notes to Financial Statements for the year ended June 30, 2019


` in lakhs
S. No.
Nature of Transactions
    For the year ended
June 30
Ultimate Holding
& Holding Company
    Fellow Subsidiary Companies
        Key Managerial Personnel
14.
Computer Expenses
2019
Ñ
324
Ñ


2018
Ñ
310
Ñ
15.
Rent Expenses
2019
Ñ
4 708
Ñ


2018
Ñ
3 347
Ñ
16.
Dividend Remitted / Paid
2019
17 848
496
Ñ


2018
6 024
167
Ñ
17.
Managerial Remuneration
2019
Ñ
Ñ
937


2018
Ñ
Ñ
783
18.
Processing Charges
2019
Ñ
11 166
Ñ


2018
Ñ
9 484
Ñ
19.
Outstanding as at June 30th





Loans given
2019
Ñ
9 000
8


2018
Ñ
9 000
Ñ

Interest Income Accrued
2019
Ñ
609
Ñ


2018
Ñ
1 347
Ñ

Trade and other receivables
2019
26
1 501
Ñ


2018
56
1 214
Ñ

Trade payables
2019
6 480
5 065
Ñ


2018
3 856
2 076
Ñ
The sales to and purchases from related parties are made on terms equivalent to those that prevail in armÕs length transactions.
Outstanding balances at the year-end are unsecured and interest free and settlement occurs in cash. There have been no guarantees provided or received for any related party receivables or payables. The Company has not recorded any impairment of receivables relating to amounts owed by related parties in the current year or prior years. This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.

(d) Disclosure in respect of material transactions of the same type with related parties during the year:
` in lakhs
S. No.
Nature of Transactions
  Year ended June 30, 2019
  Year ended June 30, 2018
1.
Purchase of Goods
Procter & Gamble International Operations SA Singapore Br The Procter & Gamble Company
Procter & Gamble Home Products Private Limited Gillette Diversified Operations Pvt Ltd
Others

 Ñ 514
1 158
14 735
237

1 115
339
971
Ñ 75
Notes to Financial Statements for the year ended June 30, 2019


` in lakhs
S. No.
Nature of Transactions
  Year ended June 30, 2019
  Year ended June 30, 2018
2.
Purchase of Equipment / Assets / Spares The Procter & Gamble Distributing LLC Fameccanica Data S.P.A.
Procter & Gamble Manufacturing GMBH
Procter & Gamble Home Products Private Limited Others
Sale of Products
Procter & Gamble Bangladesh Private Limited Others
Sale of Capital goods
Procter & Gamble Home Products Private Limited Others
Loans Given
Procter & Gamble Home Products Private Limited
Loans Realised
Procter & Gamble Home Products Private Limited
Interest Income
Procter & Gamble Home Products Private Limited
Recovery of Expenses Cross charged
The Procter & Gamble Company
Procter & Gamble Home Products Private Limited Gillette India Limited
Procter & Gamble International Operations SA Singapore Br Others
Expenses cross-charged
The Procter & Gamble Company
Procter & Gamble Home Products Private Limited Gillette India Limited
Others
Reimbursement of expenses shared by group cos. (Income)
Procter & Gamble Home Products Private Limited Gillette India Limited
Reimbursement of expenses shared by group cos. (Expense)
Procter & Gamble Home Products Private Limited Gillette India Limited
Business Process Outsourcing expenses
Procter & Gamble International Operations SA-ROHQ The Procter & Gamble Company




313
806


153
149


107
131


115
Ñ


7
59
3.





654
602


102
Ñ
4.





47
77


7
5
5.





9 000
9 000
6.





9 000
9 000
7.





794
770
8.





530
675


3 174
2 162


123
147


497
Ñ


276
489
9.





407
365


1 079
1 795


613
352


113
143
10.





823
616


1 120
1 594
11.





54
Ñ


19
268
12.





842
643


5 183
3 831

Notes to Financial Statements for the year ended June 30, 2019


` in lakhs
S. No.
Nature of Transactions
  Year ended June 30, 2019
  Year ended June 30, 2018
13.
Royalty



The Procter & Gamble Company
14 307
12 190
14.
Computer Expenses



The Procter & Gamble US Business Services Company
324
310
15.
Rent expenses



Procter & Gamble Home Products Private Limited
4 669
3 347

Others
39
Ñ
16.
Dividend Remitted / Paid



Procter & Gamble Overseas India BV
17 848
6 024

Others
496
167
17.
Processing Charges



Procter & Gamble Home Products Private Limited
11 166
9 484

Gillette Diversified Operations Pvt Ltd
2 282
Ñ
(e) Compensation of key management personnel
The remuneration of directors and other key management personnel during the year was as follows:



Year ended
` in lakhs
Year ended

June 30, 2019
June 30, 2018
Short-term benefits
436
427
Post-employment benefits
369
Ñ
Share-based payments
132
356

937
783
(f) Other transactions with key management personnel




` in lakhs

  Year ended June 30, 2019
  Year ended June 30, 2018
Loan given
Ñ
Ñ
Loan realised
Ñ
23
Note:


1. Disclosure required under section 186(4) of the Companies Act, 2013 for Loans given:
` in lakhs

Sr.
No.
Name
Relations
Amount given during the year ended June 30, 2019
Amount given during the year ended June 30, 2018

Inter corporate loans



1.
Procter & Gamble Home Products Private Limited
Fellow Subsidiary
9 000
9 000
Above inter corporate loans have been given for general business purposes for meeting their working capital requirements.
Notes to Financial Statements for the year ended June 30, 2019

33. Operating lease arrangements Company as a lessee
33.1 Leasing arrangements
The Company has taken on lease guesthouses for accommodation of employees and office premises and warehouses with an option of renewal at the end of the lease term and escalation clause in some of the cases. These leases can be terminated with a prior notice as per terms and conditions of the respective lease agreements. The Company has also entered into an arrangement which in substance falls under the Appendix C to IND AS 17 ÒDetermining whether an arrangement contains a leaseÓ and the payments for the lease have been bifurcated from payments for other elements in the arrangement. The lease payments under the above mentioned leasing arrangement have been disclosed in note 33.2.
33.2 Payments recognised as an expense
  Year ended June 30, 2019
` in lakhs
  
Year ended June 30, 2018
` in lakhs
Minimum lease payments	6 238	4 498
6 238	4 498
33.3 Non-cancellable operating lease commitments
       
As at June 30, 2019
` in lakhs
       
As at June 30, 2018
` in lakhs
Not later than one year	339	44
Later than one year but not later than five years	984	Ñ
Later than five years	Ñ	Ñ
Total	1 323	44
34. Commitments
       
As at June 30, 2019
` in lakhs
       
As at June 30, 2018
` in lakhs
Estimated amount of contracts remaining to be executed on capital account and not provided for
65	175
65	175

	
35. Contingent liabilities

As at

As at

June 30, 2019
` in lakhs
June 30, 2018
` in lakhs
Claims against company not acknowledged as debts


Income Tax matters
17 037
11 005
Sales Tax matters


(i)	Non submission of ÒCÓ Forms / ÓFÓ Forms
2 194
2 664
(ii) Incomplete accounts books under sales tax
227
227
(iii) Classification issues under sales tax
24
38
(iv) Product valuation issues under sales tax
59
59
(v) Other sales tax matters
925
1 018

Notes to Financial Statements for the year ended June 30, 2019




Excise duty, service tax and custom duty matters

        As at June 30, 2019
` in lakhs

        As at June 30, 2018
` in lakhs

(i)	Classification issues under excise tax
Ñ
9
(ii) Product valuation issues under excise tax
Ñ
95
(iii) Applicability of service tax matters
1 225
1 226
(iv) Other excise, service tax and customs matters
2
2
(v) Custom duty
Ñ
19
Other matters



Other claims Ð The Company is a party to various legal proceedings in the normal course of business
75

75

21 768

16 437
36. Disclosures under the Micro, Small and Medium Enterprises Development Act, 2006
        As at June 30, 2019
` in lakhs


        As at June 30, 2018
` in lakhs
(a) Principal amount remaining unpaid to any supplier as at the end of the accounting year
(b) Interest due thereon remaining unpaid to any supplier as at the end of the accounting year
(c) The amount of interest paid along with the amounts of the payment made to the supplier beyond the appointed day
218	231

166	127

1 039	1 132
Principal paid beyond the appointed date	1 039	1 132
Interest paid in terms of Section 16 of the Act	Ñ	Ñ
(d) The amount of interest due and payable for the year	39	52
(e) The amount of interest accrued and remaining unpaid at the end of the accounting year
(f) The amount of further interest due and payable even in the succeeding year, until such date when the interest dues as above are actually paid
166	127
2	1
Dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management. This has been relied upon by the auditors.
37. (a) Reimbursement / (recovery) of expenses cross charged to related parties include payments / recoveries on account of finance, personnel, secretarial, administration and planning services rendered under common services agreements with Procter & Gamble Home Products Private Limited and Gillette India Limited. (Refer Note 38).
(b) Certain expenses in the nature of employee costs, relocation costs and other expenses are cross charged by the Company to its fellow subsidiaries at actual. Similar expenses incurred by fellow subsidiaries are cross charged to the Company at actual.
38. (a) Employee Benefits Expense excludes expenses in respect of Managerial personnel of ` 67 lakhs (Previous Year:
` 588 lakhs) cross charged to Gillette India Limited and Procter & Gamble Home Products Private Limited in terms of the common services agreement (Refer Note 37).
(b) Employee Benefits Expense includes expenses in respect of Managerial personnel of ` 185 lakhs (Previous Year:
` 150 lakhs) cross charged from Gillette India Limited and Procter & Gamble Home Products Private Limited in terms of the common services agreement (Refer Note 37).
Notes to Financial Statements for the year ended June 30, 2019
39. Dividend



Dividend on equity shares paid during the year


  Year ended June 30, 2019
` in lakhs


  Year ended June 30, 2018
` in lakhs
Final dividend for the FY 2017-18: ` 40 (PY: FY 2016-17: ` 27) per equity share of ` 10 each
12 984	8 764
Dividend distribution tax on final dividend	2 670	1 784
Interim dividend for the FY 2018-19: ` 40 (PY: FY 2017-18: ` Nil) per equity share of ` 10 each
12 984	Ñ
Dividend distribution tax on interim dividend	2 670	Ñ
Total	31 308	10 548
Proposed Dividend:
The Board of Directors at its meeting held on August 21, 2019 have recommended a payment of final dividend of
` 48 per equity share of face value of ` 10 each for the financial year ended June 30, 2019. The same amounts to
` 18 784 lakhs including dividend distribution tax of ` 3 203 lakhs.
The above is subject to approval at the ensuing Annual General Meeting of the Company and hence is not recognised as a liability.

40. Previous year figures have been regrouped / reclassified wherever necessary to correspond with the current yearÕs classification / disclosure.
41. Approval of financial statements
The financial statements were approved for issue by the Board of Directors on August 21, 2019.

Signatures to Note 1 to  41

For and on behalf of Board of Directors

R. A. Shah	Madhusudan Gopalan
Chairman	Managing Director
DIN: 00009851	DIN 08158357
Prashant Bhatnagar	Flavia Machado
Chief Financial Officer	Company Secretary

Place: Mumbai
Date: August 21, 2019

TEN YEAR FINANCIAL HIGHLIGHTS

IGAAP
IND AS

2010
2011
2012
2013
2014
2015
2016
2016^
2017^
2018^
2019^
YEAR END FINANCIAL POSITION (` Crores)
Net Fixed Assets
130.3
190.4
198.4
214.9
239.5
308.8
316.9
352.2
326.6
271.6
248.8
Net Worth
534.6
600.6
786.6
805.3
1002.9
1228.7
1511.2
1651.8
526.1
805.5
909.1
SUMMARY OF OPERATIONS (` Crores)
Gross Sales
913.5
1037.0
1310.1
1696.7
2063.6
2358.4
2552.7
2349.2
2419.2
2455.3
2946.5
Profit before Tax
233.6
178.7
223.0
286.2
460.3
500.8
636.5
635.5
671.8
581.8
607.3
Profit after Tax
179.8
150.9
182.9
203.2
302.0
346.1
423.2
422.5
432.7
374.6
419.1
Dividend
73.0
73.0
73.0
81.2
89.3
98.2
116.9
98.2
1291.9*
87.6
259.7*
PER SHARE DATA
EPS (`)
55.38
46.48
57.30
62.61
93.04
106.63
130.37
130.16
133.31
115.40
129.12
Dividend (%)
225
225
225
250
275
302
360
302
3980
270
800
NUMBER OF SHARES
Shares (Lakhs)
324.61
324.61
324.61
324.61
324.61
324.61
324.61
324.61
324.61
324.61
324.61
^ Figures for these years are as per new accounting standards (Ind AS) and Schedule III of Companies Act, 2013.
Hence these numbers are not comparable with previous years
* Includes Interim Dividend
NOTES




Our Purpose, Values and Principles








OUR PURPOSE
We will provide branded products and services of superior quality and value that improve the lives of the worldÕs consumers, now and for generations to come.

U


OUR VALUES
Integrity Leadership Ownership
Passion for Winning Trust





OUR PRINCIPLES
We show respect for all individuals.
The interests of the Company and the individual are inseparable.
We are strategically focused on our work. Innovation is the cornerstone of our success.
We are externally focused. We value personal mastery. We seek to be the best.
Mutual interdependency is a way of life.






vakils
' ...
.
...................'
...

r	cter
y	i	n	n	H
G	m	I
Ith C	r	Limited

P&G Plaza, Cardinal Gracias Road, Chakala, Andheri (East), Mumbai - 400099.
Tel. : (9  -22) 2 2	F  x : ( 1-22) 282	7337