Milkfood Ltd

TO THE MEMBERS

The Directors present their Thirty Seventh Report together with Audited Accounts of theCompany for the financial year ended 31^st March, 2010.

OPERATIONS

During the period under Report, the Company's sales and other income were Rs.30,994lacs and cash loss is Rs. 0.32 lacs as compared to last year's figures of Rs. 24,309 lacsand cash profit of Rs. 501 lacs respectively. After depreciation, the loss for the year isRs. 488.88 lacs as compared to the profit of Rs. 128.45 lacs in the previous year.

DIVIDEND

No dividend has been recommended by the Directors.

FIXED DEPOSITS

As on 31.03.2010, there were only twelve unclaimed fixed deposits with Companyamounting to Rs. 3,13,000/-, out of which nine fixed deposits amounting to Rs. 2,23,000/-have been renewed/refunded.

CONSOLIDATED ACCOUNTS

The Consolidated Accounts of the Company and of its wholly owned subsidiary company isannexed to this Report. PARTICULARS OF EMPLOYEES

Information as per section 217(2A) of the Companies Act, 1956 read with the Companies(Particulars of Employees) Rules, 1975 form part of this Report. However, as per theprovisions of section 219(1)(b)(iv), Report and Accounts are being sent to all the membersof the Company excluding the statement of particulars of employees. Any member interestedin obtaining a copy of the said statement may write to the Company Secretary at theRegistered Office of the Company.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the provisions contained in sub section (2AA) of Section 217 of theCompanies Act, 1956, your Directors confirm that:-

(i) in the preparation of the annual accounts for the financial year ended 31^stMarch, 2010 the applicable accounting standards have been followed;

(ii) the Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe losses of the Company for that year;

(iii) the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act, 1956for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities; and

(iv) the Directors have prepared the annual accounts on a going concern basis.

CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement, a separate Report on CorporateGovernance and a Certificate from the Auditors of the Company regarding the compliance ofthe conditions of Corporate Governance are annexed to the Directors' Report.

INFORMATION UNDER THE LISTING AGREEMENT WITH STOCK EXCHANGE

The shares of your Company are listed at the Bombay Stock Exchange Ltd. (BSE) and theStock Code at BSE is: 507621. Listing fees for the financial year 2010-11 has been paid.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

As required under Section 217(1)(e) of the Companies Act, 1956 read with Rule 2 of theCompanies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, theinformation relating to Conservation of Energy, Technology Absorption and Foreign ExchangeEarnings and Outgo is annexed.

DIRECTORS

Mrs. Asha Gadi, Director, retires by rotation and, being eligible, offers herself forre-election. The Board recommends her reappointment.

Brief resume of the above Director, nature of her expertise in specific functionalareas and name of companies in which she holds the Directorship and theMembership/Chairmanship of the Committees of the Board as stipulated under Clause 49 ofthe Listing Agreement with the Stock Exchange are annexed in the Corporate GovernanceReport.

AUDITORS

M/s R.N. Bahl & Co., Chartered Accountants, Auditors of the Company retire at theconclusion of this Annual General Meeting and being eligible offer themselves forre-appointment.

GENERAL

Your Directors wish to express their appreciation of the co-operation and support givenby all employees and the bankers of the Company during the year.

The notes forming part of the Accounts being self-explanatory, the comments made by theStatutory Auditors in their Report are not being dealt with separately.