Mohan Breweries & Distilleries Ltd Management Discussions.

MOHAN BREWERIES AND DISTILLERIES LIMITED ANNUAL REPORT 2006-2007 MANAGEMENT DISCUSSION AND ANALYSIS PERFORMANCE OF THE COMPANY During the year under report, the Company recorded a turnover of Rs. 759.02 Crores against Rs.583.95 crores in the previous year. The Company has earned a profit of Rs. 19.08 Crores (previous year: Rs.10.60 Crores). The details of profits and distribution of the same are given below: Rs. In Lacs Year Ended Previous Year 31.3.2007 31.3.2006 Profit before Taxation 1907.61 1060.36 Provision for Taxation Current Tax 815.00 381.00 Deferred Tax (Net) (291.53) (279.35) Fringe Benefit Tax 45.00 56.00 PROFIT AFTER TAX 1339.14 902.71 Add: Surplus brought forward From previous year 7173.89 6271.18 BALANCE CARRIED TO BALANCE SHEET 8513.03 7173.89 BREWERY LICENSED CAPACITY Your directors wish to inform you that your Company has got approval from the Government of Tamilnadu for enhancing the Brewery capacity from 67,50,000 cases per annum to 1,05,30,000 cases per annum without monthly restriction vide G.O. (Ms) No. 60 dt. 9.8.2007. This will enable your Company to hardness the market potential to the fullest extent. BIO-MASS BASED POWER EXPANSION PROJECT Your directors have pleasure in informing you that the capacity expansion of Bio-mass based Power Project from 12 MW to 18 MW is in progress and is expected to be commissioned in November 2007. EXPANSION OF GLASS DIVISION Your directors have pleasure in informing you that your Company is in the process of enhancing the capacity of the unit from 140 TPD to 240 TPD at a total project cost of Rs. 67 crores. Term Loan to the tune of Rs. 50 crores is being planned and necessary applications have been submitted for sanction of the same. The balance cost will be funded out of internal sources. The project is expected to commissioned in July 2008. REAL ESTATE Your directors wish to inform you that the Real Estate Project is progressing and your Company is in the process of complying with the Memorandum of Understanding entered into with the Developers for development of the Township in an area of 55 acres of land at Chennai. The project is scheduled to commence construction during Mid 2008. BIO-DIESEL PROJECT Your directors have pleasure in informing you that the biodiesel project pursued under M/s.D1 Mohan Bio Oils Limited is progressing and have enlisted 31500 acres under Contract Farming till date. M/s.lndian Bank and M/s. Karur Vysya Bank support Jatropha cultivation by extending Crop Loan facilities to individual farmers, under tie-up arrangement with M/s.D1 Mohan. M/s. State Bank of Hyderabad and M/s. Bank of Baroda have evinced keen interest in funding Jatropha cultivation in a big way. AGRICULTURE DIVISION Your directors have pleasure in informing you that the trial cultivation of Casurina Junghuniana, new species taken in our Farm at Kadalur Village, Chingleput District has given very good results arid your Company plans to multiply this tree seedling by Vegetative Propagation Method in a bigger way for sale to the farmers in Kancheepuram District for enhancing the availability for,your Bio-mass based Power Project at Palyaseevaram, Kancheepuram District. The Jatropha cultivation in 600 acres in our Wind Farms at Kayathar/Perungudi is in good shape. The scanty rainfall in that region has forced the Company to restrict further expansion of cultivation of Jatropha. TRADING DIVISION Your directors have pleasure informing you that the Trading Division have registered a trading turnover of Rs.14.46 crores for the year ended 31.3.2007 and handled Sugar, Coal, Palm Oil, Sanitary Wares, Paper Waste, Kitchen Fittings etc. during this year.