Annual Report

CONTENTS
Report of the Directors Report on Corporate Governance Auditors Report Balance Sheet Statement of Profit and Loss Cash Flow Statement Notes to Financial Statements Auditors Report on Consolidate Financial Statements Consolidated Financial Statements 1 13 29 34 35 36 38 67 68
Chairmans Statement
Dear fellow shareholders, The signal milestone of 100 million cases sale of Kingfisher Beer is the crowning highlight of our Companys growth story during fiscal 2012. You will recall that the entire market for beer in India, just 10 years ago, was as small as 26 million cases, throwing into sharp relief the pace of growth in the industry and more particularly of United Breweries Ltd. Overall sales for the year amounted to 133 million cases representing a growth of 6% over the previous year. This has enabled our Company to notch up market share of 55%, more than twice that of our closest competitor. It is significant to note that our mild beers dominate the market with a 70% share, while Kingfisher Strong has achieved a 50%+ share in the much larger strong beer segment of the market. It is a tribute to our Companys manufacturing processes that our breweries have not only been approved for local brewing of Heineken but also that the product brewed in India has been acknowledged to be one of the finest when compared with global beers. Locally brewed Heineken is now available in Delhi, Bangalore, Kolkata, Goa and Maharashtra. It has been well received in each of these markets and plans are underway to roll out the brand in other markets around the country during the coming year. As proud as I am of the achievements of our brands, reflecting their primal position among major Indian consumer brands, we have been equally focused on long term strategies to improve manufacturing efficiencies and conserve resources. Thus, major initiatives such as introduction of patented bottles, control of energy and reduction of water consumed in the manufacturing process not only helped to keep costs down in an environment of severe cost pressure, but are also good practices that benefit the environment and the communities in which we operate. The underlying demand is boosted by the demographics of the country as well as changing attitudes towards the consumption of alcoholic beverages, particularly beer, among our young population. To cater to this long term trend of growth, even though it is periodically interrupted by ill conceived government regulations and taxation, our Company is required to continuously invest in capacity enhancement. During the year under review capacity was expanded in West Bengal, Orissa, Andhra Pradesh and Maharashtra. The coming year should see commencement of production at the new greenfield brewery in Karnataka and commencement of construction of a new brewery in Bihar. As in the past years, Kingfisher (and now Heineken) continue to have pride of place in the Indian consumers mind. The aspirational qualities of our brands continue to be invigorated by consistent association across themes
Chairmans Statement (contd.)

which are close to the young consumers, i.e. Sports, Fashion, Music and Food. Our Company also leverages new social media such as Facebook and Twitter to advantage. In fact, Kingfishers Facebook has a fan following of over 3.5 million, which makes it the second largest in the world for a beer brand. While seeking to take advantage of rapid and sustainable growth, we are also conscious of the need to de-risk the business. To this end, several strategic initiatives to cover Inputs, Packaging material and, indeed, Information Technology, have been put in place. I would particularly draw your attention to: Our Company has been reducing its carbon footprint through reduction of energy consumed by 5% 10% annually. A ground breaking project to generate electricity from spent grain will be inaugurated during the current year. United Breweries Ltd. has won many awards for conservation of water and our aim is to reduce use of water to a level of 3.5 kl/kl, which is the global benchmark, from the already excellent level of 4 kl/kl. Our Company also invests in Primary Education and Primary Health Welfare in 27 villages where we operate. The educational initiatives presently cover over 2500 students with emphasis on female literacy. Potable water initiatives bring clean drinking water to 20 villages. In addition empowerment through contract farming helps nearly 5000 farmers. These initiatives will continue to receive the managements attention in the years to come. During the year, the merger of UB Ajanta Breweries Private Limited into our Company was approved by the Courts. With this, United Breweries Ltd. has substantially completed its corporate restructuring and is now a fully integrated entity with brand ownership, manufacturing, sales and distribution all under one roof. I am grateful for the enthusiastic efforts of all stakeholders without whose participation and commitment our Company would not have been able to grow from strength to strength every year. A very warm thank you to all.
VIJAY MALLYA CHAIRMAN
Report of the Directors

Your Directors have pleasure in presenting this Annual Report and the audited accounts of United Breweries Limited (UBL or your Company) for the year ended March 31, 2012 (the year under review, the year or FY12). FINANCIAL RESULTS AN OVERVIEW (Amounts in Rupees million) Year ended March 31 2012 Net Turnover EBITDA Depreciation and amortization EBIT Interest Provision for Dimunition in investment in Subsidiary Profit before Taxation Provision for Taxation Profit after Tax available for appropriation Appropriations: Proposed dividend on Equity Shares (including taxes thereon) Dividend on Preference Shares paid (including taxes thereon) Transfer to the General Reserve Balance your Directors propose to carry to the Balance Sheet Total appropriations DIVIDEND Your Board of Directors take pleasure in declaring a dividend of Re.0.70 per Equity Share, including on 9,860,211 Equity Shares of Re.1/- each fully paid up allotted during the year upon amalgamation of UB Nizam Breweries Private Limited, Chennai Breweries Private Limited, Millennium Beer Industries Limited and UB Ajanta Breweries Private Limited. Your Company paid a dividend on Cumulative Redeemable Preference Shares (CRPS) at the rate of 3% under the terms of the issue of 24.7 million CRPS held by Scottish & Newcastle India Limited, amounting to Rs.28 million. The total dividend (including dividend tax) is Rs.243.25 million, which amounts to about 19.2% of Profit after Tax. AMALGAMATIONS Your Directors are pleased to inform that UB Ajanta Breweries Private Limited has been amalgamated into your Company by the Order of the Honble Board for Industrial and Financial Reconstruction with the appointed date of April 1, 2011. The consolidation has ensured creation of a larger combined entity, and synergies in the businesses besides economies of scale. Combining all functions and operations has not only resulted in enhanced financial performance but also has provided benefits in the form of managerial and technical expertise, and financial resources thereby enhancing shareholder value. As a final step towards consolidation and restructuring of all brewing entities of the Group, the Board of Directors of your Company and of Scottish and Newcastle India Private Limited (SNIPL), an Indian subsidiary of Heineken UK Limited (Heineken Group), have approved amalgamation of SNIPL into your Company under Sections 391 to 394 of the Companies Act, 1956. All requisite regulatory approvals for the said amalgamation have been obtained and an application has been filed with the High Courts of Karnataka and Bombay by your Company and SNIPL respectively. CAPITAL In view of the consolidation of share capital through the amalgamation of UB Ajanta Breweries Private Limited, the Authorized Share Capital of your Company now comprises of Equity Share Capital aggregating to Rs.3,674 million and Preference Share Capital of Rs.5,860 million. The Issued, Subscribed and Paid-up Share Capital as on 215 28 150 871 1,264 184 86 150 1,053 1,473 37,007 4,850 1,487 3,363 991 196 2,176 (912) 1,264 2011 31,048 4,348 1,305 3,043 781 2,262 (789) 1,473
Report of the Directors (contd.)

March 31, 2012 stood at Rs.1,005.1 million, comprising of Equity Share Capital of Re.1 each aggregating to Rs.264.4 million and Cumulative Redeemable Preference Shares of Rs.100 each aggregating to Rs.740.7 million. MANAGEMENT DISCUSSION AND ANALYSIS INDUSTRY OVERVIEW The Indian beer market is at the start of its growth trajectory, with a per capita consumption of only about 1.5 liter. This is significantly below the global average per capita consumption of 27 liters and other emerging markets such as China (37 liter), Brazil (65 liter) and Russia (72 liter), as estimated by Canadean for the calendar year 2011. Beer accounts for about 32% of the Indian alcoholic beverages market by volume. The largest segment in the Indian alcoholic beverages market is Indian Made Foreign Liquor (IMFL) that accounts for about 41% by volume, while country liquor accounts for around 27% of the market. Both are spirits that typically contain over 40% alcohol. Key reasons for the significantly lower consumption of beer, both compared to spirits consumption in India and to beer consumption in other emerging markets, are the taxation structure, which does not substantially differentiate between the alcohol content of various classes of beverages, and the limited number of outlets that are allowed to sell beer in India. In India, regulation and taxation of alcoholic beverages is a State subject. The industry is highly regulated, often requiring a lengthy process to obtain a license for the manufacturing, distribution and sale of beer. In the majority of the country, the State governments control distribution and in states like Tamil Nadu and Kerala even the retail is operated by the government. Each state has its own taxation policy and regulations regarding cross border movements and pricing. In about 60% of the country, the State determines the price at which beer can be sold by the brewers. Even though beer contains only 5-7% of alcohol by volume and spirits contain over 40% of alcohol, both are for historic reasons considered as liquor under the various State Excise policies and taxed on a similar basis. This results in a consumer price of beer that is 2 to 3 times higher than that of spirits on an equivalent alcohol basis. The number of outlets that are permitted to sell beer is very low. It is estimated that 72,000 licensed outlets exist in India. This equates to one outlet per 17,000 people compared to an estimated 1 per 300 in China. This significantly reduces the availability of beer, and therewith reduces beer consumption. Notwithstanding the constraints mentioned above, we believe the future of the industry is very bright. A high growth economy and a young population bring significant opportunities for the beer industry. Indias growing young population has led to the emergence of a substantial active workforce that has increasing disposable income. Growth in the alcoholic beverages sector has also been fueled by the increasing social acceptability of alcohol consumption, especially for beer and wine, and evolving consumer taste. The size of the Indian beer industry in the year under review is estimated at about 235 million cases, showing a compounded annual growth rate of around 11% in the past 5 years. As a result of a weak economic climate, regulatory changes and a poor summer, growth of the Indian beer market in FY12 was significantly lower than the previous year. We estimate the market to have grown by about 4%. Strong beer continues to take share from mild beer, and is now estimated to account for 81% of the beer market. United Breweries Limited has continued to expand its clear market leadership in the Indian beer market, overcoming the challenges of the highly regulated industry and competition from global brewers. For the 5th year in succession, your Company has increased its market share and widened the gap with its competitors. OPERATIONS SALES Your Company has achieved a volume growth of 6% on a like-for-like basis in the year under review, outgrowing the industry in a difficult year. Our total sales volume has reached 133 million cases, driven primarily by growth in Andhra Pradesh, Karnataka, Rajasthan, Uttar Pradesh and Goa. The net sales for the year 2011-2012 stood at Rs.36,277 million as against net sales of Rs.30,598 million in the previous year, registering a growth of 18.6%. This includes the first time consolidations of Chennai Breweries Private Limited and Asia Pacific Breweries Aurangabad Private Limited. Our national market share in FY12 has exceeded 54.5%, which is twice the size of the nearest competitor. We continue to lead the mild beer market with 70% market share, and hold over 51% of the strong beer market. In the year under review, your Company has increased its market share in the states of Andhra Pradesh, Uttar Pradesh, Haryana,

Maharashtra, Punjab, Rajasthan, West Bengal, Karnataka and Goa. Our shares in Tamil Nadu, Bihar and Kerala were affected by supply and environmental issues. The flagship Kingfisher brand created history by achieving the milestone of 100 million cases sold in the financial year 2011-2012. A fantastic achievement in the history of the Indian beer industry, this success has been made possible by Kingfisher Strong, Indias largest selling beer, further consolidating its leadership position by registering record volumes, while Kingfisher Premium continued its lead in the mild beer segment. During the financial year, our brewery in Taloja near Mumbai was approved by Heineken for the brewing and bottling of Heineken Lager Beer. India-brewed Heineken rolled out into the markets of Mumbai and Pune on International Beer Day 5 August 2011. As at the end of the financial year, locally brewed Heineken is available in Delhi, Bangalore, Kolkata, Goa and Maharashtra, and has been well received. In the coming year we will roll out in further markets. MANUFACTURING Manufacturing expenses for the financial year 2011-2012 amounted to Rs.16,278 million, constituting 44.9% of net sales, as against Rs.13,960 million in the previous financial year, which constituted 45.6% of net sales. In the year under review, your company has continued the infusion of its own patented bottles in order to ensure sufficient availability of recycled bottles and to contain the cost of such bottles. The initiative has proven to be successful and has been the key driver behind the reduction in manufacturing variable cost, notwithstanding significant increases in the prices of new bottles. Higher barley prices were the key reason behind the increase in cost of raw materials, although this was partly offset by better efficiencies. The cost of packaging materials was impacted by our decision to use higher quality cartons as well as by an increase in paper prices. In order to secure further growth, your Company has agreements in place for the supply of malt, barley and bottles. The unit cost of power and fuel increased significantly in the year under review, the impact of which was mitigated by improved consumption efficiencies. In order to further reduce power consumption, your Company is exploring conversion of organic waste into energy to obtain savings in electricity cost in an environmentally sustainable manner. Our breweries continue to achieve efficiency improvements through enhanced operating procedures as well as through economies of scale, and thereby limiting the increase in cost of goods sold. Your Company continues to expand its brewing and bottling capacity to be able to cater to the market growth. In the year under review, your Company has expanded capacity in its breweries in West Bengal, Orissa, Andhra Pradesh and Maharashtra. Our Greenfield brewery at Nanjangud, Karnataka is expected to be commissioned shortly. In view of the rapid growth, your Company has proposed to set up Greenfield brewery in the state of Bihar. EMPLOYEE BENEFIT EXPENSES Employee Benefit expenses of your Company stood at Rs.1,882 million, as compared to Rs.1,441 million in the previous year. This constituted 5.2% of net sales, as against 4.7% of net sales in the previous year. Employee benefits expenses were higher on account of salaries increases and long term incentive settlements. SELLING AND BRAND PROMOTION EXPENSES During the period under review, your Company has spent 27.6% of net sales on selling and brand promotions as compared to 28.0% of net sales spent in the previous year. The selling and promotion expenses stood at Rs.10,003 million. Rooted in the core of your Companys DNA are brands and innovation. Our outperformance in the market place depends on how well we leverage these. Your Companys consistent brand building skills have largely contributed to our successful performance and Kingfisher is perhaps one of the countrys most well recognized consumer brands. Your Company allocates its brand spends largely across four verticals; sports, fashion, music and food. Our aim is to enhance the brand equity by associating with the most aspirational properties while delivering strong returns on our marketing investment. In sports, your Companys prime focus is towards the highly popular Indian Premier League in cricket. Our association as Good Times Partner with six of the leading teams in the IPL has been very effective in leveraging the flagship brand Kingfisher. Our sponsorship of Sahara Force India has provided the Company with global visibility for the brand. Kingfisher also continued its association as Water Partner with large city-based sporting events such as the Mumbai Marathon, Delhi

Half Marathon and Bangalore World 10K. Your Company has renewed its relation with United East Bengal Football Club as the official sponsor of the Kingfisher East Bengal FC team. Fashion as a vertical has been aligned with Kingfisher Ultra, the super-premium brand in the portfolio, Kingfisher Ultra associated with premier national fashion events like Wills India Fashion Week, Lakme Fashion Week, Delhi & India Couture Week, Mens Fashion Week and also extended its association with the various emerging city based fashion weeks in Bangalore, Hyderabad, Kochi, Jaipur and Punjab. Kingfisher Premium continued with the high profile Kingfisher Calendar now in its tenth year. The launch of the Kingfisher Calendar was preceded by The Hunt for the Kingfisher Calendar Girl 2012 on national television. In Music, our main activity was The Great Indian Octoberfest, which was held in Bangalore and continued to draw huge response from the visitors with a combination of international rock bands, famed DJs, Bollywood artists, flea markets, and contests. The Great Indian Octoberfest has now become a much anticipated fixture in the Countrys social and cultural calendar. With Food, we have continued our association with the Kingfisher Explocity Food Guides across seven cities and remain the brand that has invested over the years in the concept of Good Food Tastes Better with Kingfisher. The Kingfisher brand is very active in new media, as evidenced by its Facebook fan page that now has a fan base of over 3.5 million. This has catapulted the brand into being one of the top five Facebook fan pages from India, and its following is the second largest across the globe for any beer brand fan page. The aforementioned launch of Heineken has greatly bolstered our already robust portfolio. Great care is taken in the production and distribution of Heineken to ensure that the high standards of quality are maintained, and the consumer gets the value he is paying for. Our initial focus for the brand has been to install it well in its launch markets and create awareness through premium visibility and cold stock management. In the coming year, we will activate the brand by leveraging global Heineken properties such as the association with James Bond and UEFA Champions League football. EARNINGS BEFORE INTEREST, TAXATION, DEPRECIATION AND AMORTISATION (EBITDA) EBITDA for the year under review stood at Rs.4,850 million as compared to Rs.4,348 million in the previous year, reflecting an increase of 11.5%. This is a fine accomplishment in light of a volume growth of only 6%. The increase in EBITDA is to a large extent a result of strong growth in the profitable market of Karnataka and the continued leadership position in Maharashtra and West Bengal. INTEREST AND DEPRECIATION Interest paid during the year amounted to Rs.991 million, as against Rs.781 million in the previous year. Depreciation for the year was Rs.1,487 million as compared to Rs.1,305 million in the previous year. PROFIT BEFORE AND AFTER TAXATION The Profit before Taxation for the year stood at Rs.2,176 million, as compared to Rs.2,262 million in the previous year, reflecting an decrease of around 3.8%. The Profit after Taxation stood at Rs.1,264 million, as against Rs.1,473 million in the previous year. OPPORTUNITIES, THREATS, RISKS & CONCERNS India is the second most populous country in the world, with a population of over 1.1 billion. India is estimated by the UN to overtake China as the most populous country by 2025. The country is entering a period where the working age group is particularly prominent, the so-called demographic window, with about half the population below 25 years of age. As per Datamonitor, about 38% of the alcoholic beverages consumption is from consumers in the age bracket of 2534 years. Therefore Indias demographic composition bodes well for high growth in the Indian beer market in years to come. Even in the longer term, this demographic divided provides for sustained growth as in 2030 still about 20% of all people below 25 years of age in the world will be Indian, as compared to 11% from China. The growing economy will improve income levels substantially and NCAER estimates that todays middle class population of 160 million will grow to 547 million by 2026. This is especially significant as due to high consumer prices, beer consumption is skewed toward higher income consumers. Urban consumption of alcoholic beverages is estimated to contribute 70% to the total consumption (source: Datamonitor). The current urbanization of around 30% is expected to grow to 44% by 2030, providing a significant further impetus to growth. Consumer attitudes towards alcohol, and especially lower alcoholic beverages such as beer, are rapidly evolving in India. With urban consumers being more exposed to a western lifestyle, there has been a positive shift in consumer

behavior towards alcohol consumption. Social habits are undergoing a transformation and with further urbanization, this acceptance is only going to increase, while your company will continue to foster responsible consumption of alcohol. Today, India is already one of the fastest growing beer markets in the world. With the abovementioned drivers for further growth, a long period of significant growth is foreseen. Although the prospects of your Company are bright, there are significant risks and concerns that the industry and your Company face. These are mainly evolving around the significant government intervention in the industry, high taxation, restricted communication, and inflation in the cost of raw materials. The largest challenge to the beer industry is the pervasive nature of government controls. The Indian beer industry is suffering from a myriad of taxes and levies that vary from state to state. No two States or Union Territories have the same policy, and policies are generally short term in their outlook and impacted by state budget deficits, with limited consideration to long-term interests of all stakeholders, including the general public. Changes in taxation and regulation are particular high risks to this industry and might significantly impact profitability from time to time. Some states have taken positive steps to differentiate between spirits and lower alcohol alternatives such as beer. There have been multiple instances where state governments have increased excise duty for spirits while maintaining the excise rate for beer or opting for a smaller increase in rates than that of spirits. Although this is far away from an alcohol content based excise policy that is prevalent in most countries, even a small differentiation between beer and spirits taxation is a good step towards delinking the two. The State of Maharashtra has started to issue beer shop licenses, which allow the sale of only beer and wine and not spirits. This has been a significant driver for growth in the Maharashtra beer industry and in excise revenue. A harmonized Goods and Services Tax (GST) regime has been under consideration by the Central and State Governments for the past years. There are views that the alcoholic beverages industry should be excluded from GST altogether. Exclusion of an industry is against the foundation of GST and would not achieve the stated objective of creating a uniform market with uniform taxes, and could potentially increase taxation of the industry. Shortage of input materials is a potential risk factor in any emerging market. Your company uses, amongst others, barley, hop, water, glass and aluminium for producing and packaging its products. Your company has explored a number of avenues to address increases in cost of input materials, and is taking measures to ensure we continue to receive a sustainable supply of quality barley. Your company is recognized by the UN for its efforts in responsible water consumption. In the year under review, your Company has also entered into a long term contract with a glass manufacturer to derive cost and supply advantages in packaging and thereby containing risk. Regulation over retail pricing in many states may create an environment where your Company is unable to pass on the real escalation in cost of raw materials, which could impact profitability from time to time. RISK MANAGEMENT Your Company has evolved a framework for management of business risks. Towards this end, your Company performs a risk assessment in which strategic risks, operative risks, information technology risks and financial risks are considered and mitigating actions are identified. This is reviewed regularly by the internal audit team and the Audit Committee of the Board. Continuity and sustainability of the business is as important to stakeholders as growing and operating the business. Managing risks and protecting the business from the effects of material adverse events are focal points on the managements agenda. PROSPECTS After a year in which many challenges held back growth of the industry, your Company expects to see a healthy growth in sales volumes. In many markets your Company is dependent on State governments permitting price increases which may or may not be forthcoming. In those markets where your Company is allowed to determine its own selling prices, your Company aims to do so taking inflation into account. The competitive environment is expected to remain intense. Your Companys strategy and focus remains consistent to robustly defend and strengthen our leadership positions, and to maintain its position as the clear leader in the Indian beer market. In light of the high inflation and high interest rates, costs will continue to remain high and volatile, especially in the case of raw materials. The positive impact on costs from the infusion of patented bottles is continuing. Several smaller brewers have tried to use our bottles notwithstanding our patent, and we have used and will continue to use all legal means available to enforce our rights.

Your Company is implementing several operational improvement projects that will ensure that it remains competitive, in the market place and in costs, and will manage the business even more dynamically. In view of the positive prospects, your Company is setting up Greenfield Breweries in Patna (Bihar) and Nanjangud (Karnataka). The brewery at Nanjangud is expected to be commissioned shortly and the brewery in Bihar is likely to be operational sometime during the financial year ending March 31, 2014. In addition, your Company will continue to invest towards increasing capacity and upgradation of its existing breweries. Through these actions, your Directors are hopeful that your Company would achieve a sustained leadership position, grow ahead of the market and realize a structural improvement in profitability in the years to come. SUSTAINABILITY & SUSTAINABLE GROWTH There are four facets of sustainability that United Breweries Limited has built initiatives around: 1. 2. 3. 4. Reduction in carbon footprint, to ensure a better planet for the generations to come Water conservation, critical in a country that is listed as drinking-water deficient Positively impacting stake-holders that reside around our breweries Helping farmers who are part of the value chain get better net remuneration for their produce
Carbon footprint reduction Your Company has set itself an aggressive target on reducing specific energy consumption (as well as controlling energy cost). The manufacturing team continues to reduce energy by 5 -10% in use through efficiency improvement and innovative solution/technologies. Your Company is now proud to mention that all but a couple of its breweries use biomass /agri-waste boilers for generating steam, as part of if its campaign to progress renewable energy. The newer breweries have already installed solar energy based street lighting and lower carbon generating LED lights. Several breweries have now begun recovering heat from wort boiling. Water conservation After ensuring that all breweries now consume less than 5 kl/kl water, your Company has embarked on an aggressive initiative to bring water consumption down to a world class level of 3.5 kl/kl. Contemporary waste water treatment systems have been installed, to allow recycling of water into designated parts of the brewery. Several breweries have now touched levels of 4 kl/kl in consumption and your Company continues to drive water consumption down by almost 10% each year. In addition to this, rain water harvesting (RWH) has been taken up in select breweries that use ground water, so as to minimize depletion of water table. Impacting stakeholders in villages Two agricultural universities have now certified that our treated waste water can be used productively for crops. This is the outcome of a joint effort between the breweries and those universities, with tests being conducted within brewery premises. This certification will allow us to provide water for growing crops all the year round to villagers. It has been proven that the productivity of some crops is much higher with this water. At some breweries, your Company initiated organic farming as well as testing growing of barley. Helping farmers Your Company has now expanded contract farming activities in Haryana through its associates and has also embarked on providing its own patented seeds for 6 row barley growing in new states like Uttar Pradesh, traditionally known for growing low quality varieties of feed barley. These initiatives not just help us assure availability in our supply chain but also help farmers increase productivity on their meager lands and assure remunerative prices for their produce. CORPORATE SOCIAL RESPONSIBILITY Your Company views Corporate Social Responsibility not as philanthropy but as a form of sustained partnership with the goal to generate long term value for all stakeholders. We believe it is our responsibility to contribute to the improvement of the society around us and our breweries, which in a country like India is translated into a focus on basic necessities of life. We focus CSR efforts on four areas: Potable Water Management, Contract Farming, Primary Health and Welfare, and Primary Education. Each of these initiatives aim at creating long-term value and having a deep impact on the lives of those involved. With each of it addressing a very specific yet basic need of the communities, it ensures a rise in the overall quality of life of the local population in and around our breweries. To ensure better implementation and sustained success of these

initiatives, most of these activities draw heavily from the local population when it comes to monitoring or initiating some key activities. This increases their stake in these activities, ensuring a level of local involvement which augurs well for the projects long term continuation.
Primary Education 2500 students Advocating female literacy, distribution of books, school uniforms & other stationaries etc. Primary Health 27 Villages Health camps, mobile medical service, dispensaries
We Care
Water 20 Villages Give access to potable drinking water to the community around
Contract Farming 5000 farmers Generate livelihood through empowerment of farmers
PRIMARY EDUCATION Your Company cares strongly about investing in future and hence its attachment with the education sector has been strong. Not only basic education, but also providing educational aids and daily catering needs of children is covered under its ambit, making your Company contribute towards the development of underprivileged children in its own humble, yet effective way. UBL Rajasthans efforts on improving female literacy has featured on the website for Project EKTA, an initiative by the Government of Rajasthan to improve the condition of primary education of women in Rajasthan. UBL Rajasthan also received an award from the Rajasthan Health Minister in recognition of its CSR activities especially for adoption of multiple primary schools in the Alwar District under the PPP model. UBL Kalyani has been working progressively with the visually challenged kids of Anne Sullivan Institution for the Sightless, imparting vocational training and conducting motivational programs. Apart from these, UBL has been actively involved with primary level schools from distributing uniforms and organising midday meals to providing vocational training to students with special needs. UBL also supports needy students, provide them with nutritional supplements, in addition to supporting mid-day meal schemes. Modernisation of education through teaching aids and academic tools are of key priority. Efforts are also being made towards enrolling and retaining maximum number of girl students. Financial support to needy students of Palakkad, maintenance of school premises in Ludhiana, mid-day meal schemes in Cherthala, providing teaching aids to schools in Goa, Dharuhera, Srikakulam, and gender based literacy initiatives in Goa, Dharuhera, and Srikakulam are some of our endeavors in this area. With the intention of nursing and providing a better foundation for tomorrows healthy, responsible and productive citizens, we are investing into long term value enhancing projects, which go on to reiterate our commitment to the growth and development of the local communities in and around UBLs breweries. PRIMARY HEALTH We believe in the age old maxim that health is wealth and that well-being of our society starts with the good health of its people. From operating primary health care camps in the vicinity of our breweries in association with local governing bodies, to providing infrastructure to existing dispensaries and organising awareness programs, primary healthcare remains to be the centre of our focus area. The objective of our initiatives is to foster good health and to make primary health care more accessible and affordable. For instance, the mobile medical service in identified villages in/around Srikakulam treats hundreds of villagers on a weekly basis. In Nelamangala, more than 900 families today benefit from the health centre set up for them. UBL Mumbai has held several medical camps at Palekhurd and Dongerpada villages. UBL Aurangabad has been involved in disbursing free medicines from its health check-up centres. Furthermore the actions of UBL Cherthala in ensuring the control of epidemics and contagious diseases in Allepey district of Kerala have been commendable. The other activities include free check-up camps for the visually challenged in Kalyani, free consultation and medication in Goa, healthcare centres at Aurangabad, Rajasthan, Mumbai and Mangalore, free medical check-up for students of Gurukul school by UBL Aurangabad.

CONTRACT FARMING Your Companys belief that social initiatives are more acts of partnership than philanthropy is best reiterated with its contract farming initiative with barley-cultivating farmers. Your Company initiated the Barley Information Centre - Barley Hubs to ensure that there is ample knowledge dispersal with regards to barley cultivation. Your Company is making efforts to improve the conditions of farmers by helping them grow high quality and high yielding barley varieties in Punjab, Haryana, Rajasthan and Uttar Pradesh. This has provided us significant goodwill with the State governments. This initiative has helped the farmers to improve the quality of their barley crops. To evaluate the present production technology and to transfer advanced technology to farmers, your Company has tied up with ITCs Agricultural Division and have conducted 600 demonstrations to prove higher yields of its patented improved varieties of barley in different states like Punjab, Haryana, Rajasthan and Uttar Pradesh. WATER MANAGEMENT Water is probably the most essential and basic of our needs, and also a key input material for our industry. It is in our own interest to conserve water, given the water dependence of our industry; hence our investments into technological knowhow in dealing with water and its purification gives us an advantage when it comes to providing local communities with a source of potable water. Our water conservation and regeneration schemes are devised to provide a sustainable benefit to the local communities around our breweries. Recent initiatives such as Project Jeevan Dhara - distribution of potable water to villagers during the harsh summers under the aegis of UBL Odisha - have been highly acclaimed by the authorities and local population alike. We have been optimising our beer brewing and bottling process to reuse and reduce the water consumption. In the past years, we have made a significant reduction in the usage of water, and we aim at achieve a world class efficiency in water consumption in the coming years. Our ongoing initiatives such as installation of state-of-the-art equipment, such as waste water recycling systems and use of Reverse Osmosis plants, have led to production of and re-use of water in several areas of our plants. Also the change of systems and processes has led to reduction of consumption and disposal of water. Furthermore, UBL has been demonstrating the use of ETP treated water for crop cultivation to local farmers. The initial work in this aspect has been done with respect to barley and vegetable cultivation in UBL Golconda and UMBL Srikakulam. The latter is also entering into a Memorandum of Understanding with the Acharya NG Ranga Agricultural University for a collaborative research project on the use of brewery effluents for farming. OTHER INFORMATION INTERNAL CONTROL SYSTEM Your Company has established a robust system of internal controls to ensure that assets are safeguarded and transactions are appropriately authorized, recorded and reported. Internal Audit evaluates the functioning and quality of internal controls and provides assurance of its adequacy and effectiveness through periodic reporting. Your Companys internal control systems are robust and are routinely tested and certified by statutory and internal auditors. The process adopted provides reasonable assurance regarding the effectiveness and efficiency of operations, reliability of financial reporting and compliance with applicable laws and regulations. In order to continuously upgrade the internal control system, to be in line with international best practices and to ensure proper corporate governance, your Company has implemented risk assessment, control self assessment and legal compliance management. These have been updated during the year under review. The internal control system evaluates adequacy of segregation of duties and reliability of management information systems, including controls in the area of authorization procedures and steps for safeguarding assets. Periodic reviews are carried out for identification of control deficiencies and opportunities for bridging gaps with best practices along with formalization of action plans to minimize risks. Your Company believes that the overall internal control system is dynamic, and reflects the current requirements at all times, hence ensuring that appropriate procedures and controls, in operating and monitoring practices are in place. Internal Audit reports to the Audit Committee and recommends control measures from time to time. HUMAN RESOURCES During the year under review, significant steps have been taken towards redefining HR processes, systems and initiatives. Your Company has implemented an online performance appraisal system for executives and staff. This system was

implemented to increase visibility, speed, and transparency, with the intent to integrate the performance appraisal system with other employee life-cycle events (such as succession planning, training and development and compensation). We have also revamped our collaboration portal Sampark as part of your Companys organizational theme on redefine, re-invent, re-charge. This portal has been designed taking into consideration a multi-dimensional need of collaboration and engagement across a distributed workforce. Both of these initiatives were implemented with a long term focus on organisational performance and collaboration. Your Company has a diverse employee base across many locations and providing a platform for learning which is relevant, distributed, advanced and offers a consistent experience is a significant asset to your Company. During the year, we have launched the UBL University which provides an advanced distributed learning platform to its widely dispersed employee population and brings about a culture of learning through different forms and means. Further, our focus on organic capability building at our breweries has shown significant traction, with more than 35% of the trainings at our breweries being conducted by internal subject matter experts and an increased focus on around-the-machine training. In a complex industrial relations environment, the long-term-settlement processes that have been completed or initiated in the year under review had a specific focus on alignment and engagement with our associates. The year under review has been exemplary with regards to industrial harmony. We continued to significantly improve our performance in the areas of productivity, hygiene and safety through focused initiatives. As on March 31, 2012, the total employee strength at United Breweries Limited stands at 2,489. Your Company has not offered any stock options to the employees during the year under review. Your Directors place on record their sincere appreciation to all employees for their contribution towards the continuous success of the organization. SUBSIDIARY COMPANIES Maltex Malsters Limited is the only subsidiary in which your Company holds 51% of equity capital. A copy of its Accounts will be provided on request to any member, on receipt of such request by the Company Secretary at the Registered Office of your Company. The statement pursuant to Section 212 (1) (e) also forms part of this Annual Report. CONSOLIDATION As per the Listing Agreement, the Consolidated Accounts conforming to the applicable Accounting Standards are attached to this Annual Report. CASH FLOW STATEMENT A Cash Flow Statement for the year ended March 31, 2012 is appended. LISTING REQUIREMENTS Your Companys Equity Shares are listed on the Bombay Stock Exchange Limited, National Stock Exchange of India Limited and the Bangalore Stock Exchange Limited. The listing fees have been paid to all the Stock Exchanges for the year 2012 2013. Your Company has obtained in principle listing approvals of stock exchanges where listed, in respect of 709,578 Equity Shares issued and allotted to the shareholders of erstwhile UB Ajanta Breweries Private Limited upon amalgamation as mentioned above during the year under review. DEPOSITORY SYSTEM The trading in the equity shares of your Company is under compulsory dematerialization mode. Your Company has entered into Agreement with National Securities Depository Limited and Central Depository Services (India) Limited in accordance with the provisions of the Depositories Act, 1996 and as per the directions issued by Securities and Exchange Board of India. As the depository system offers numerous advantages, members are requested to take advantage of the same and avail of the facility of dematerialisation of the Companys shares. FIXED DEPOSITS There were no outstanding fixed deposits at the end of the previous financial year. Your Company has not invited any Fixed Deposits during the year. ADDITIONAL STATUTORY INFORMATION The statement containing particulars of employees as required under Section 217 (2A) of the Companies Act, 1956 forms a part of this Directors Report and is annexed. Particulars required under Section 217(1)(e) are also annexed.

CAUTIONARY STATEMENT Statements in this Report, particularly those which relate to Management Discussion and Analysis and Opportunities, Threats, Risks and Concerns, describing your Companys objectives, projections, estimates and expectations, may constitute forward looking statements within the meaning of applicable laws and regulations. Actual results might differ materially from those either expressed or implied. DIRECTORS The Board of Directors of your company comprises of twelve Directors, with a balanced combination of Independent and Promoter Directors. Mr. A K Ravi Nedungadi, Mr. Chugh Yoginder Pal and Mr. Sunil Alagh retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. DIRECTORS RESPONSIBILITY STATEMENT Pursuant to Section 217(2AA) of the Companies Act, 1956, your Board of Directors reports that: - in the preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any; and - accounting policies have been selected and applied consistently, and that the judgments and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period; and - proper and sufficient care have been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and - the annual accounts have been prepared on a going concern basis. CORPORATE GOVERNANCE A Report on Corporate Governance forms part of this Report along with the Certificate from the Company Secretary in Practice. AUDITORS AND AUDITORS REPORT Messrs Price Waterhouse, Statutory Auditors of your Company are not seeking re-appointment at the forthcoming Annual General Meeting. Your Directors place on record their appreciation for the valuable services rendered by them during their tenure as Auditors of your Company. It is proposed to appoint Messrs S.R. Batliboi & Associates, Chartered Accountants, as the Statutory Auditors of your Company to hold office from the conclusion of this Annual General Meeting till the conclusion of the next Annual General Meeting. Messrs S.R. Batliboi & Associates, Chartered Accountants, have consented to be the Auditors of your Company if appointed by the Members at the Annual General Meeting and have also confirmed that their appointment would be within the limits specified under section 224(1B) of the Companies Act, 1956. There are no qualifications or adverse remarks in the Auditors Report which require any clarification or explanation. ACKNOWLEDGEMENT Your Directors wish to place on record their appreciation for the continued support received from shareholders, banks and financial institutions. Your Directors are also grateful to the Companys business partners and customers for their continued support and patronage. Finally, your Directors wish to acknowledge the support and contribution on the part of all employees who constitute our most valuable asset. By Authority of the Board,
June 08, 2012 Bangalore
Kalyan Ganguly Managing Director
Guido de Boer Director, CFO
10
Annexure to Directors Report

STATEMENT UNDER SECTION 217(1)(e) OF THE COMPANIES ACT, 1956 A. Conservation of Energy Energy conservation measures taken by the Company: Electrical Energy: Vapour absorption machine commissioned in Chennai brewery unit for generating chilled water for wort cooling instead of using high electricity consuming reciprocating compressors. Automation on all alternate fuel boilers installed to reduce electricity consumption. Lighting energy savers installed at Mumbai, Bangalore and Mangalore units. Focus on optimal work-in-process during the off-season has reduced refrigeration load and consequently reduced energy consumption. Fuel Oil Consumption: De-super heaters installed at Bangalore, Palakkad and Kalyani units to generate higher feed water temperature in boilers leading to reduced solid fuel consumption. After successful implementation of alternate fuel boilers at units located at Punjab, West Bengal and Andhra Pradesh, alternate fuel boilers are installed at all units except at Cherthala. This has reduced fuel cost substantially. Water Conservation: Recycling of effluent treated water with programmable logic control operated reverse osmosis plant installed at Mallepally, Srikakulam and Ludhiana Unit to ensure water conservation. Rainwater harvesting initiative is being undertaken at Mallepally unit in a phased manner to save water and enhance the ground water table. Environment: LED coupled with solar power and geo-thermal office cooling system installed at Mallepally unit. Vapor Heat recovery systems are installed at Bombay and Hyderabad. Heat recovery system is installed in the wort kettle at the Goa unit, which substantially reduces heat emission into the atmosphere. This initiative is a part of reduction in emissions. B. Technology Absorption Mash filter and high speed 36000 BPH bottling line commissioned at Mallepally unit. Coil cooler installed for DG sets at Dharuhera and Hyderabad units in place of radiators to increase efficiency of DG sets during longer running hrs at high temperature regions. Latest technology in labellers, Auto PU controlled pasteurizer and fillers for beer packaging has been implemented at Mallepally unit. This has resulted in improved quality, reduced wastages and higher line productivity. C. Research and Development The Company has continued its Research & Development (R&D) program in the area of development of two row malting variety of Barley. The Company will shortly launch a flavoured beer in the market by utilizing the technology developed by our R&D department. D. Foreign Exchange Inflow and Outflow (Rupees in Million) Foreign Exchange earned Foreign Exchange used : : Rs.14.90 Rs.1,271
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Annexure to Directors Report (contd.)

STATEMENT UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956 READ WITH THE COMPANIES (PARTICULARS OF EMPLOYEES) RULES, 1975 (EMPLOYED FOR FULL YEAR) Sl. No. 1 2 3 4 5 6 7 Name Kalyan Ganguly Shekhar Ramamurthy Guido de Boer Cedric Vaz Joseph Noronha Kiran Kumar Perry Goes Age 61 51 40 54 57 44 47 Date of Joining 1-Feb-79 15-May-89 1-Oct-09 15-May-06 15-Jul-91 28-Apr-97 14-Jun-04 Total Remuneration 66,833,375 38,092,593 22,537,944 17,498,396 16,046,622 14,574,510 14,313,971 Designation Managing Director Deputy President Director & CFO EVP Manufacturing EVP HR SVP Sales Educational Qualifications B.A. (Hons), PGDBM (XLRI) B.Tech. (Civil)-IIT, Delhi, PGDBM-IIM-Kolkata M.Sc., Economics & Business B.Tech. (Chem. Eng.) IIT-Kanpur B.Com. (Hons.) PGDPM-IR (XLRI) B.Com., PGDBM IIM-Ahmedabad Experience in Years 39 25 15 30 32 21 25 Previous Employment EVP - Marketing & Sales McDowell & Co. Ltd. General Manager - Marketing Herbertsons Ltd. Heineken International B.V. Head Operations - Cadbury India Ltd. Personnel Manager - The Oberoi Bogmalo Beach, Goa Marketing Manager Herbertsons Ltd. Group Leader for Business Analytics - Honeywell Technologies Solutions Labs Heineken International B.V.
SVP - Strategic B.E. (Meh.), PGDBM Planning & Business (Mktg-Fin. & HR) - Goa Analysis Inst. of Mgmt. Technological Advisor Chemical Engineer (M.Sc., Biochemistry) Delft University of Technology The Netherlands B.A., MBA (Marketing) Symbiosis Inst.of Mgmt., Pune B.Com., L.L.B, A.C.S B.Sc., PGD IFAT, DBA, PGDM & IR B.Com., F.C.A B.E. (Industrial & Production), PGDCA B.Com., A.C.A, A.I.C.W.A. B.Com., M.Com., DCM, MBA-IIMS Calcutta
Henk Breederveld
61
11-Oct-10
14,302,808
34
Samar Singh Sheikhawat
46
9-Nov-09
12,660,494
SVP Marketing
22
Vice President - Marketing Spencers Retail Ltd. Company Secretary - Citurgia Biochemicals Ltd. Assistant Brewer - Indo Lowenbrau Breweries Ltd., Faridabad First Employment Manufacturing Manager - Pepsi Co India Holdings Accounts Executive BPL Sanyo Technologies Ltd. Senior Manager - Systems McDowell & Co. Ltd.
10 Govind Iyengar 11 Govind Tiwari
45 60
5-Feb-01 12-Feb-75
9,772,686 9,764,000
SVP - Legal & Secretarial DVP - UBL Goa
22 42
12 R K Jindal 13 R Santosh Kumar
51 46
19-Mar-85 1-Jul-98
9,526,321 9,495,046
SVP - Operations & Malting SVP Procurement & Logistics AVP Finance AVP IT
27 24
14 P A Poonacha 15 S Ramakrishnan
41 51
1-Jul-96 1-Jun-95
7,940,317 7,242,638
17 31
All the employees mentioned above are in full time employment with the Company. CFO - Chief Financial Officer, EVP - Executive Vice President, SVP - Senior Vice President, DVP - Divisional Vice President, AVP - Assistant Vice President.
By Authority of the Board,
June 08, 2012 Bangalore
Guido de Boer Director, CFO
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Report on Corporate Governance

A. MANDATORY REQUIREMENTS COMPANYS PHILOSOPHY ON CORPORATE GOVERNANCE As Manifested in the Companys vision, United Breweries Limited has always strived for excellence in Corporate Governance. Beyond mere compliance, we are committed towards taking all strategic initiatives to enhance Shareholders wealth in the long term. In pursuit of corporate goals, the Company accords high importance to transparency, accountability and integrity in its dealings. Our philosophy on Corporate Governance is driven towards welfare of all the Stakeholders and the Board of Directors remains committed towards this end. The Board of Directors supports the broad principles of Corporate Governance and lays strong emphasis on its role to align and direct the actions of the Company in achieving its objectives. BOARD OF DIRECTORS Your Company is managed and controlled through a professional Board of Directors. The Board comprises of a balanced combination of non-Executive and independent Directors in addition to the Managing Director and the Chief Financial Officer. Your Companys Board consists of eminent persons with considerable professional expertise and experience. Matters of policy and other relevant and significant information are regularly made available to the Board. In order to ensure better Corporate Governance and transparency, the Company has constituted an Audit Committee, Investors Grievance Committee, Remuneration / Compensation Committee, Share Transfer Committee, Amalgamation Committee and Borrowing Committee to look into the aspects of each Committee. Internal Audit carried out by the Group Internal Audit team that is commensurate with the size of the organization. There is a comprehensive management reporting system involving preparation of operating results and their review by senior management and by the Board. In addition to securing Board approvals for various matters prescribed under the Companies Act, 1956, matters such as annual budget, operating plans, material show cause notices and demands, if any, minutes of Committee meetings, control self-assessment, risk management and updates thereof are regularly placed before the Board. During the financial year ended on March 31, 2012, 5 Board Meetings were held on April 27, 2011, August 09, 2011, October 31 2011, November 23, 2011 and February 07, 2012. ATTENDANCE AT BOARD MEETINGS AND ANNUAL GENERAL MEETING (AGM) Names of the Directors Dr. Vijay Mallya Mr. Kalyan Ganguly Mr. A K Ravi Nedungadi Mr. Duco Reinout Hooft Graafland Mr. Theodorus Antonius Fredericus de Rond Mr. Guido de Boer Mr. Chugh Yoginder Pal Mr. Sunil Alagh Mr. Chhaganlal Jain Ms. Kiran Mazumdar Shaw Mr. Madhav Bhatkuly Mr. Stephan Gerlich Mr. Sijbe Hiemstra @ Category Chairman (NE) Managing Director Director (NE) Director (NE) Director (NE) Director (CFO) Director (NE, Ind) Director (NE, Ind) Director (NE, Ind) Director (NE, Ind) Director (NE, Ind) Director (NE, Ind) Director (NE) Number of Number of Attendance at the Board Meetings Board Meetings last AGM held on held attended 21.12.2011 5 5 5 5 5 5 5 5 5 5 5 5 5 5 4 5 3 2 5 5 4 5 2 4 2 1 YES YES YES YES YES YES YES YES YES
Notes: NE Non Executive, Ind Independent, CFO Chief Financial Officer @ Mr. Sijbe Hiemstra opted out of the Board on August 09, 2011.
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Report on Corporate Governance (contd.)

MEMBERSHIP IN BOARDS AND BOARD COMMITTEES OTHER THAN UNITED BREWERIES LIMITED (UBL) Membership in Boards other than UBL 19 3 8 NIL NIL NIL 7 4 5 9 2 4 Membership in Board Committees other than UBL Prescribed for reckoning the limits under Clause 49 of the Listing Agreement ** NIL NIL 6 (Chairman of 1 Committee) NIL NIL NIL 4 (Chairman of 3 Committees) 1 (Chairman of 1 Committee) 2 (Chairman of 2 Committees) 1 NIL 1 Other Committees not so prescribed *** NIL NIL 1 NIL NIL NIL 3 2 1 NIL NIL 2 (Chairman of 2 Committees)
Names of the Directors
Dr. Vijay Mallya Mr. Kalyan Ganguly Mr. A K Ravi Nedungadi Mr. Duco Reinout Hooft Graafland Mr. Theodorus Antonius Fredericus de Rond Mr. Guido de Boer Mr. Chugh Yoginder Pal Mr. Sunil Alagh Mr. Chhaganlal Jain Ms. Kiran Mazumdar Shaw Mr. Madhav Bhatkuly Mr. Stephan Gerlich
The above position is as on the date of this Report and in respect of their Directorships only in Indian Companies. ** Audit & Investors Grievance Committees *** Remuneration, Share Transfer & Other Committees NOTES: a) Out of 19 other Companies in India in which Dr. Vijay Mallya is a Director, 7 are Private Limited Companies and 2 are Section 25 Companies. Dr. Vijay Mallya is also on the Board of 36 Overseas Companies. b) Out of 3 other Companies in which Mr. Kalyan Ganguly is a Director, 1 is a Private Limited Company. Mr. Kalyan Ganguly is also on the Board of 1 Overseas Company. c) Out of 8 other Companies in which Mr. A K Ravi Nedungadi is a Director, 2 are Private Limited Companies and 1 is a Section 25 Company. Mr. A K Ravi Nedungadi is also on the Board of 9 Overseas Companies. d) Mr. Duco Reinout Hooft Graafland is on Board of 2 Overseas Companies. e) Mr. Theodorus Antonius Fredericus de Rond is on Board of 20 Overseas Companies. f) Mr. Guido de Boer is not a Director in any other Company. g) Out of 7 other Companies in which Mr. Chugh Yoginder Pal is a Director, 1 is a Private Limited Company. h) Out of 4 other Companies in which Mr. Sunil Alagh is a Director, 1 is Private Limited Company. i) Out of 5 other Companies in which Mr. Chhaganlal Jain is a Director, 1 is a Private Limited Company. j) Out of 9 other Companies in which Ms. Kiran Mazumdar Shaw is a Director, 4 are Private Limited Companies and 1 is a Section 25 Company. Ms. Mazumdar is also on Board of 4 Overseas Companies. k) Mr. Madhav Bhatkuly is a Director in 2 Private Limited Companies. Mr. Bhatkuly is also on Board of 2 Overseas Companies. l) Out of 4 other Companies in which Mr. Stephan Gerlich is Director, 2 are Private Limited Companies and 1 is a Section 25 Company.
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PARTICULARS OF DIRECTORS RETIRING BY ROTATION AND BEING RE-APPOINTED Mr. A K Ravi Nedungadi, Mr. Chugh Yoginder Pal and Mr. Sunil Alagh retire at the ensuing Annual General Meeting and being eligible, have offered themselves for re-appointment. Their brief particulars are mentioned below: Brief resume Mr. A K Ravi Nedungadi A trained Chartered Accountant, Mr Nedungadi set early academic records by qualifying in the final of the Chartered Accountancy Exam at the age of 20. He joined the UB Group in 1990 as the Corporate Treasurer. Within two years, he was transferred to London as Group Finance Director of the Groups international business managing the businesses of UB International, which included the paint giant Berger Jenson and Nicholson, spanning 27 countries. He was instrumental in listing the Berger group companies on London and Singapore bourses. Since his appointment as the President and Group CFO in 1998, he led the way to sharpening the focus of the Group, on areas of core competence and global reach. This saw the group focus on three verticals Brewing, Distilling & Aviation, each area presenting clear leadership within India and global significance too. He was also responsible for opening up the beverage alcohol sector to Global Best Practices and Transparency, enabling the entry of institutional investors and rerating of the industry itself. Mr. Nedungadi is the recipient of many awards of excellence including the Udyog Ratan Award; CNBC TV 18s CFO of the year M&A (2006), the CNBC Award for Indias best CFO in the FMCG & Retail Sector (2007), the IMA Award for CFO of the year (2007), etc. Memberships in esteemed organizations like WHOs Who of Professionals only reinforce the above testimonials. Further, he is on the Board of Directors of several companies, both in India and overseas. Mr. Nedungadi joined the Board on August 09, 2002. Mr. Chugh Yoginder Pal Mr. Chugh Yoginder Pal is a Graduate in Engineering with First Class (Distinction) from Delhi University. He started his career at TELCO in 1958 & was trained in Industrial Engineering after which he moved to Hindustan Lever in 1960, where he held various positions starting as an Industrial Engineer & moving up quickly in the Management hierarchy in a variety of Productions, Factory and General Management roles and was head of Corporate Materials Management (1975-1977). He then joined Cadbury India Limited & held various positions as Technical Director (1977-1982), Managing Director (1983-1987), Chairman & Managing Director (19871994), Executive Chairman (1994-1997); He continues to be the Chairman (Non-Executive) at Cadbury India Limited. Mr. Pal brings with him great expertise & understanding of the Indian Business environment. Mr. Pal is on the Board of UBL since April 29, 2005. Other Boards - Induri Farm Limited - Maya Entertainment Limited - Cadbury India Limited - Shriram Pistons & Rings Limited - Aptech Limited - Franchising Association of India - Renfro India Private Limited Audit Committees - Cadbury India Limited (Chairman) - Aptech Limited (Chairman) - Shriram Pistons & Rings Limited Investors Grievance Committee - Cadbury India Limited (Chairman) Other Directorships & Committee Memberships Other Boards - Sanofi India Limited - Bayer CropScience Limited - Kingfisher Airlines Limited - Shaw Wallace Breweries Limited - Millenea Vision Advertising (P) Limited - Beta Edutech Limited - Idea Streamz Consultants Private Limited Audit Committees - Kingfisher Airlines Limited - Sanofi India Limited - Bayer CropScience Limited Investors Grievance Committees - Kingfisher Airlines Limited - Sanofi India Limited - Bayer CropScience Limited (Chairman)
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Other Boards Mr. Sunil Alagh is Chairman of SKA Advisors, a Business Advisory / - GATI Limited - Indofil Industries Limited Consultancy firm with a focus on Marketing and Brand building strategies. - GATI Import Export Trading Limited He is a graduate in Economics (Hons.) with MBA from IIM Calcutta. He has - SKA Advisors Private Limited worked with ITC Limited, Jagatjit Industries Limited and Britannia Industries Limited. He was Managing Director and CEO of Britannia Industries Limited Investors Grievance Committee - Indofil Industries Limited (Chairman) from 1989 to 2003. During his tenure, Britannia figured in the Forbes Magazine list of 300 Best Small Companies in the world for 3 years. It also became the Number 1 food Brand in India. Mr. Sunil Alagh He is a member of the Governors of IIM Bangalore. In addition, he is a member of the Round Table on Higher Education of the Ministry of HRD, Government of India and on the Advisory Board of the Jawaharlal Darda Institutute of Engineering & Technology, Yavatmal. He is a former member of the Board of IL&FS Investsmart Ltd., the Indian Advisory Board of Schindler, Switzerland, an erstwhile Member of the Board of Governors of IIIM Indore and Governing Council of the National Institute of Design, Ahmedabad. He was honoured with the Gold Medal Kashalkar Memorial Award 2000 for outstanding contribution to the food processing industry in India. He was a finalist for the Ernst and Young Entrepreneur of the Year Award, 2002. Mr. Alagh is on the Board of UBL since April 29, 2005. NOTE: Committee Memberships of Directors mentioned above includes only those Committees prescribed for reckoning of limits under Clause 49 of the Listing Agreement. None of the Directors are related inter-se. COMMITTEES OF DIRECTORS The Board has constituted Committees of Directors as mandatorily required and to deal with matters which need urgent decisions and timely monitoring of the activities falling within their terms of reference. The Board Committees are as follows: AUDIT COMMITTEE The Audit Committee comprises of Mr. Chugh Yoginder Pal, Mr. Sunil Alagh and Mr. Chhaganlal Jain as members, all of whom are independent Directors. The Chairmanship of the Committee vests with Mr. Chugh Yoginder Pal. The Committee oversees the financial reporting process, disclosure requirements and matters relating to Internal Control System. The Committee also reviews periodically the financial accounts, adequacy of the internal audit function, compliance with accounting standards and other areas within its terms of reference, as under; i) ii) iii) iv) Oversee the Companys financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible; Recommending to the Board, the appointment, re-appointment and, if required, the replacement or removal of the statutory auditor and the fixation of Audit fee; Approval of payment to statutory auditors for any other services rendered by the statutory auditors; Reviewing, with the Management, the Annual Financial Statements before submission to the Board for approval, with particular reference to; Matters required to be included in the Directors Responsibility Statement to be included in the Boards report in terms of Clause 2AA of Section 217 of the Companies Act, 1956; 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 the Management; Significant adjustments made in the financial statements arising out of Audit findings;
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v) vi) Compliance with listing and other legal requirements relating to financial statements; Disclosure of any related party transactions; Qualifications in the draft audit report; Reviewing with the Management the quarterly financial statements before submission to the Board for approval; Reviewing with the Management, performance of Statutory and Internal Auditors, adequacy of Internal Control Systems;
vii) Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure, coverage and frequency of internal audit; viii) Discussing with Internal Auditors any significant findings and follow up there on; ix) x) xi) Reviewing the findings of any internal investigations by the Internal Auditors in to matters where there is suspected fraud or irregularity or failure of Internal Control Systems of a material nature and reporting the matter to the Board; Discussing 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; To look into the reasons for substantial defaults in the payment to Depositors, Shareholders (in case of non-payment of declared Dividends), Debenture-holders and Creditors;
xii) To review the function of the Whistle Blower mechanism, in case the same is existing, and xiii) Carrying out any other function as may be mentioned in the terms of reference of the Audit Committee from time to time. The Audit Committee mandatorily reviews the following information: 1. Management discussion and analysis of financial conditions and results of operations; 2. Statement of significant related party transactions submitted by the management; 3. Management letters / letters of internal control weaknesses issued by the Statutory Auditors; 4. Internal audit reports relating to internal control weaknesses, and 5. The appointment, removal and terms of remuneration of the Chief Internal Auditor. During the Year ended March 31, 2012, 5 Audit Committee Meetings were held on April 27, 2011, August 09, 2011, October 31, 2011, November 23, 2011 and February 07, 2012. ATTENDANCE AT AUDIT COMMITTEE MEETINGS Names of the Directors Mr. Chugh Yoginder Pal Mr. Sunil Alagh Mr. Chhaganlal Jain Category CHAIRMAN MEMBER MEMBER Number of Audit Committee Meetings held 5 5 5 Number of Audit Committee Meetings attended 5 4 5
The Company Secretary was present in all the Meetings of Audit Committee. SHARE TRANSFER COMMITTEE The Share Transfer Committee comprises of Mr. A K Ravi Nedungadi and Mr. Kalyan Ganguly as Members. Mr. A K Ravi Nedungadi, a non-executive Director is the Chairman of the Committee. The Terms of reference are as under: To monitor Transfer, Transmission and Transposition of the Shares of the Company; Issue of Duplicate Share Certificates, in lieu of Certificates lost or misplaced; Issue of New Share Certificates in lieu of Certificates torn, mutilated, cages for transfer filled up etcetera; Consolidation and sub-division of Share Certificates; To oversee compliance of the norms laid down under the Depositories Act, 1996;
17

To appoint/remove Registrar and Transfer Agent; To oversee compliance of the norms laid down under the Tripartite Agreement with National Securities Depository Limited /Central Depository Services (India) Limited, and Perform all such acts and deeds, matters and things as it may in its absolute discretion deem necessary, expedient, desirable, usual or proper and to settle any question, dispute, difficulty or doubt that may arise in regard to the matters arising out of the aforesaid acts. In order to facilitate prompt and efficient service to the Shareholders all the transactions in connection with Transfer, Transmission, issue of Duplicate Certificates, etc., have been entrusted to Integrated Enterprises (India) Limited (Formerly known as Alpha Systems Private Limited), Registrar and Transfer Agent and the same are being processed and approved on fortnightly basis. During the year ended March 31, 2012 the Committee met 4 times on April 27, 2011, August 9, 2011, October 31, 2011, and February 07, 2012 for approving the transactions falling within the Terms of reference mentioned above. The Board of Directors has, by a resolution by circulation passed on May 5, 2004, delegated the power to approve transfers / transmission etc., upto 5000 shares to the Managing Director and the Company Secretary, who can act severally in the above matter. INVESTORS GRIEVANCE COMMITTEE The Investors / Shareholders Grievance Committee comprises of Mr. Chugh Yoginder Pal, Mr. Sunil Alagh and Mr. Chhaganlal Jain as Members. Mr. Chugh Yoginder Pal is the Chairman of the Committee. The Terms of Reference for the Committee include inter alia specifically to look into the redressing of Shareholders and Investors complaints like non-receipt of Balance Sheet, non-receipt of declared Dividends, non-receipt of Share certificates, Demat Credit, etcetera, and operate in terms of the provisions of the Listing Agreement and/or the provisions as may be prescribed under the Companies Act, 1956 and other related Regulations from time to time. The Compliance Officer is Mr. Govind Iyengar, Senior Vice President Legal and Company Secretary. Number of Shareholders complaints received from 01-04-2011 to 31-03-2012 (These complaints pertained mainly to non-receipt of Share Certificates upon transfer, non-receipt of Annual Report, non-receipt of Dividend / Interest Warrants / Redemption Warrants, etc.) Number of complaints not solved to the satisfaction of the Shareholders Number of pending Share transfers 38 NIL NIL
During the year ended March 31, 2012, one meeting of Meeting of Investors Grievance Committee was held on August 09, 2011 which was attended by all the members. REMUNERATION /COMPENSATION COMMITTEE (A NON MANDATORY REQUIREMENT) The Remuneration Committee comprises of Mr. Chugh Yoginder Pal, Mr. Sunil Alagh and Mr. Chhaganlal Jain as Members. Mr. Sunil Alagh is the Chairman of the Committee. The Committee is authorized inter alia: to deal with matters related to compensation by way of salary, perquisites, benefits, etc., to the Managing Director / Executive /Whole time Directors of the Company and set guidelines for the salary, performance, pay and perquisites to other Senior Employees, and to formulate and implement Employee Stock Option Scheme to employees /Directors in terms of prescribed Guidelines. During the year ended March 31, 2012, 2 Meeting of Remuneration Committee were held on October 31, 2011 and November 23, 2011 which were attended by all the Members.
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REMUNERATION POLICY The Company carries out periodic reviews of comparable Companies and through commissioned survey ascertains the remuneration levels prevailing in these Companies. The Companys Remuneration Policy is designed to ensure that the remuneration applicable to Managers in the Company is comparable with multinational Companies operating in the Brewing or similar industry in India. For the financial year ended March 31, 2012, Mr. Kalyan Ganguly, Managing Director and Mr. Guido de Boer, CFO were paid remuneration as under: (Rupees) Salary & Allowance Mr. Kalyan Ganguly Mr. Guido de Boer 53,667,481/20,292,436/Perquisites 6,587,147/39,600/Retiral Benefits 6,763,601/2,018,573/-
After his initial term of 5 years, as Managing Director, Mr. Kalyan Ganguly was re-appointed as Managing Director for a further period of 5 years effective August 09, 2007 till August 08, 2012 and is proposed to be reappointed for a further period of 5 years effective August 09, 2012. SITTING FEES PAID TO DIRECTORS DURING 20112012 Sl. No. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. Total Dr. Vijay Mallya Mr. A K Ravi Nedungadi Mr. Chugh Yoginder Pal Mr. Chhaganlal Jain Mr. Sunil Alagh Mr. Duco Reinout Hooft Graafland Ms. Kiran Mazumdar Shaw Mr. Madhav Bhatkuly Mr. Stephan Gerlich Mr. Theodorus Antonius Fredericus de Rond Mr. Sijbe Hiemstra Name of the Director Sitting Fees paid (Rupees) 100,000/230,000/210,000/290,000/170,000/60,000/70,000/80,000/40,000/40,000/20,000/1,310,000/-
Sitting fees are being paid @ Rs.20,000/- for attending Board and Audit Committee Meetings and Rs.10,000/- for attending other Committee Meetings. No stock options are granted to any of the Directors so far. COMMISSION PAID TO DIRECTORS DURING 20112012 Sl. No. 1. 2. 3. 4. 5. 6. 7. Dr. Vijay Mallya Mr. Chugh Yoginder Pal Mr. Chhaganlal Jain Mr. Sunil Alagh Mr. Madhav Bhatkuly Ms. Kiran Mazumdar Shaw Mr. Stephan Gerlich Name of the Director Commission (Rupees) 14,269,200/1,654,400/1.654.400/1,654,400/1,654,400/1,654,400/1,240,800/-
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OTHER COMMITTEE MEETINGS BORROWING COMMITTEE The Board has constituted a Borrowing Committee on February 10, 2011, comprising of Mr. Guido de Boer, Mr. A K Ravi Nedungadi, Mr. Chhaganlal Jain and Ms. Kiran Mazumdar as Members. Mr. Chhaganlal Jain is the Chairman of the Committee. During the year four (4) meetings were held on May 23, 2011, August 09, 2011, September 30, 2011 and February 07, 2012. AMALGAMATION COMMITTEE An Amalgamation Committee comprising of Mr. Chhaganlal Jain, Mr. Guido de Boer, Mr. A K Ravi Nedungadi, Mr. Sunil Alagh and Ms. Kiran Mazumdar Shaw was formed to look into the Amalgamation of various companies into your Company. During the year Six (6) meetings were held on April 27, 2011, July 01, 2011, July 27, 2011, November 14, 2011, December 8, 2011 and March 12, 2012. SPECIAL COMMITTEE A Special Committee (Selection Committee) is constituted comprising of Mr. Sunil Alagh, Mr. Chhaganlal Jain, Mr. Chugh Yoginder Pal and Mr. Sheshagiri Hedge (Consultant & Expert). During the Financial Year 2011-2012 no meeting of the Selection Committee was held. GENERAL BODY MEETINGS The previous three Annual General Meetings of the Company were held on the dates, time and venue as given below: Date Time Venue Good Shepherd Auditorium, Opp. St. Josephs Pre-University College, Residency Road, Bangalore 560 025 Good Shepherd Auditorium, Opp. St. Josephs Pre-University College, Residency Road, Bangalore 560 025 Good Shepherd Auditorium, Opp. St. Josephs Pre-University College, Residency Road, Bangalore 560 025 Special Resolutions Passed
December 21, 2011
03.00 p.m.
Nil
August 20, 2010
12.15 p.m.
One
September 10, 2009
11.00 a.m.
One
All the Resolutions set out in respective Notices including Special Resolutions were passed by the Members at the above Annual General Meetings. During the year under review, pursuant to Order dated April 21, 2011 of the Honble High Court of Karnataka, Court Convened Meetings of Equity Shareholders were held on May 23, 2011 at 11.00 a.m. and 12.30 p.m. for the purpose of considering and approving the Schemes for amalgamation of UB Nizam Breweries Pvt. Ltd. and Chennai Breweries Pvt. Ltd. into your Company. These Schemes were approved with requisite majority at the respective Meetings. An Extra-ordinary General Meeting was convened and held on July 27, 2011 for the purpose of considering and approving the Schemes for amalgamation of Millennium Beer Industries Ltd., United Millennium Breweries Ltd. and UB Ajanta Breweries Pvt. Ltd. into your Company through the Board for Industrial and Financial Reconstruction. All these Schemes were unanimously approved at the Meeting.
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POSTAL BALLOT Your Company had not conducted any Postal Ballot during the year and there is no resolution proposed to be passed by postal ballot at the ensuing Annual General Meeting. None of the businesses proposed to be transacted in the ensuing Annual General Meeting require passing of resolution through postal ballot. DISCLOSURES During the financial year ended March 31, 2012, there were no materially significant related party transactions with the Companys Directors or their relatives. Details of related party transaction form part of Notes on Accounts. In preparation of financial statements for the year under review, treatment as prescribed in Accounting Standards has been followed. The Company has complied with all the statutory requirements comprised in the Listing Agreements / Regulations / Guidelines / Rules of the Stock Exchanges / SEBI / other Statutory Authorities. The Company did not suffer from any levies and there were no strictures on any Capital market related matters since incorporation. The Company has complied with the mandatory requirements of Clause 49. The Company has also constituted a Remuneration Committee which is a non-mandatory requirement. DIVIDEND Dividend on Equity Shares for the financial year ended March 31, 2012 post its declaration at this Annual General Meeting will be paid to the Members whose names appear: i. as Beneficial Owners as at the close of business hours on Monday, September 24, 2012 as per the list to be furnished by the Depositories in respect of the Shares held in electronic form, and ii. as Members in the Register of Members of the Company as on Wednesday, September 26, 2012 after giving effect to all valid Share transfers in physical form which are lodged with the Company on or before Monday, September 24, 2012. UNCLAMIED SHARES In terms of Clause 5A.II of the Listing Agreement relating to unclaimed shares, the Registrar and Transfer Agent of your Company has sent three mandatory reminders to shareholders whose share certificates remained unclaimed. In terms of the Listing Agreement, shares remained unclaimed after sending three reminders to shareholders shall be transferred into one folio in the name of Unclaimed Suspense Account and will be kept in a separate demat account. Voting rights on the outstanding shares in Unclaimed Suspense Account shall remain frozen till the rightful owner of such shares claims the shares. MEANS OF COMMUNICATION The Company has its own Web-site and all vital information relating to the Company and its performance involving quarterly results, official Press release and presentation to analysts are posted on the Companys Web-site www.unitedbreweries.com. Apart from furnishing copies of Results to all the Stock Exchanges, the Quarterly, Half-yearly and Annual Results of the Companys performance are being published in Financial Express and in Kannada Prabha Newspapers. In line with the requirement of clause 47 (f) of the Listing Agreement, the Company has designated an exclusive email ID viz, ublinvestor@ubmail.com for the purpose of registering complaints by the investors. The investors can post their grievances by sending a mail to the said email ID. Management Discussion and Analysis form part of the Directors Report.
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GENERAL SHAREHOLDER INFORMATION The Companys financial year begins on April 1 and ends on March 31 of immediately subsequent year. Division of Financial Calendar 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter April 1 to June 30 July 1 to September 30 October 1 to December 31 January 1 to March 31 Declaration of Unaudited Results 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter By August 14th By November 14th By February 14th By May 15th
In terms of amendment to the Listing Agreements, the unaudited results of the Company are to be declared within 45 days of the end of the quarter. ANNUAL GENERAL MEETING INFORMATION Board Meeting for Consideration of Accounts Posting of Annual Report Book Closure dates Last date for receiving proxy Date of AGM June 08, 2012 August 30, 2012 September 25, 2012 and September 26, 2012 September 24, 2012 September 26, 2012
In terms of the circular dated 21.04.2011 issued by the Ministry of Corporate Affairs, as a Green Initiative, the Company has effected services of its Annual Report and Notice by electronic mode at the respective email IDs registered and available in Company records.
ANNUAL GENERAL MEETING ON Wednesday, September 26, 2012 VENUE Good Shepherd Auditorium, Opp. St. Josephs Pre-University College, Residency Road, Bangalore - 560 025. TIME 11.30 a.m. DATES OF BOOK CLOSURE September 25, 2012 to September 26, 2012
LISTINGS AT STOCK EXCHANGE BANGALORE STOCK EXCHANGE LIMITED BOMBAY STOCK EXCHANGE LIMITED NATIONAL STOCK EXCHANGE OF INDIA LIMITED SCRIP CODE UNITEDBRED 532478 UBL
22

Market price data of the Companys Equity Shares traded on the Bombay Stock Exchange Limited, (BSE) during the period April 2011 to March 2012 Month April 2011 May 2011 June 2011 July 2011 August 2011 September 2011 October 2011 November 2011 December 2011 January 2012 February 2012 March 2012 High (Rs.) BSE 499.95 604.40 613.80 543.95 514.80 453.80 442.95 455.00 501.80 507.00 476.00 644.00 Low (Rs.) BSE 446.00 460.05 486.05 464.45 408.00 367.50 354.00 361.05 373.75 339.50 410.00 445.00 Close (Rs.) BSE 462.00 560.35 527.70 497.80 421.80 374.50 417.75 394.05 384.30 410.85 459.00 541.15 Sensex Close BSE 19,135.96 18,503.28 18,845.87 18,197.20 16,676.75 16,453.76 17,705.01 16,123.46 15,454.92 17,193.55 17,752.68 17,404.20
(Market Price data source: www.bseindia.com) Graphical representation of the Companys Shares in comparison to broad-based indices i.e., BSE Sensex, is given below:
Comparison - UBL Stock Price Vs. BSE Sensex

25000 560.35 527.7 497.8 462 459 421.8 20000 18845.87 19135.96 18197.2 18503.28 374.5 417.75 394.05 384.3 410.85 450 541.15
550
350 17705.01 17752.68 17404.20 250
17193.55
16676.75 15000 Apr-11 May-11 Jun-11
16453.76
16123.46
15454.92
150
Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Months (2011-2012) Sensex UBL stock price
UBL Closing Price (Rs.) (Equity Shares of Re.1)
BSE Sensex
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Market price data of the Companys Equity Shares traded on the National Stock Exchange of India Limited, (NSE) during the period April 2011 to March 2012 Month April 2011 May 2011 June 2011 July 2011 August 2011 September 2011 October 2011 November 2011 December 2011 January 2012 February 2012 March 2012 High (Rs.) NSE 500.00 604.00 614.00 543.00 512.40 452.00 442.90 421.95 502.80 507.00 484.85 648.95 Low (Rs.) NSE 446.60 461.15 489.95 466.00 405.00 370.10 352.25 361.55 372.60 381.10 410.50 448.00 Close (Rs.) NSE 463.30 561.55 530.20 501.90 422.95 374.50 416.50 395.85 383.90 409.70 458.50 539.20 Close NSE 5749.50 5560.15 5647.40 5482.00 5001.00 4943.25 5326.60 4832.05 4624.30 5199.25 5385.20 5295.55
(Market Price data source: www.nseindia.com) Graphical representation of the Companys Shares in comparison to broad-based indices i.e., NSE NIFTY, is given below Comparison - UBL Stock Price Vs. NSE Nifty
7000 561.55 6500 463.3 6000 530.2 501.9 458.5 422.95 5647.4 5560.15 5482 374.5 5326.6 4832.05 4624.3 200 416.5 395.85 409.7 383.9 5385.2 5199.25 5295.55 5001 4943.25 300 400 539.2 600
NSE NIFTY
5749.5
5500 5000 4500 4000
Apr-11 May-11 Jun-11
Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Months (2011-2012) Nifty UBL stock price
100
SHARE TRANSFER SYSTEM All matters pertaining to Share Transfer are being handled by Integrated Enterprises (India) Limited (Formerly known as Alpha Systems Private Limited), the Registrar and Share Transfer Agent of the Company. The Share Transfer requests
24
UBL Closing Price (Rs.) Equity Shares of Re.1
500

received are processed by them and a Memorandum of Transfer is sent to the Company for approval by the Committee. Time taken for processing Share Transfer requests including dispatch of Share Certificates is 15 days, while it takes a minimum of 10-12 days for processing dematerialization requests. The Company regularly monitors and supervises the functioning of the system so as to ensure that there are no delays or lapses in the system. The Company was offering the facility of transfer - cum - demat as per SEBI Guidelines. However, SEBI has vide its Circular No. SEBI/MRD/Cir-10/2004 dated February 10, 2004, withdrawn transfer-cum-demat scheme. In line with the above, on receipt of transfer requests the Company has discontinued issuing of option letters to the shareholders. The distribution of shareholding as on March 31, 2012 is furnished below: Category (Rs.) Up to 5000 5001 10000 10001 20000 20001 30000 30001 40000 40001 50000 50001 100000 100001 and Above TOTAL No. of Shareholders 43587 146 74 29 12 8 16 67 43939 % (Percentage) 99.20 0.33 0.17 0.07 0.03 0.02 0.04 0.15 100.00 No. of Shares held 9893342 1096796 1054554 719591 414856 367200 1106255 249752555 264405149 % (Percentage) 3.74 0.41 0.40 0.27 0.16 0.14 0.42 94.46 100.00
During the year 9,860,211 Equity Shares of Re.1 each were allotted upon amalgamation of UB Nizam Breweries Private Limited, Chennai Breweries Private Limited, Millennium Beer Industries Limited and UB Ajanta Breweries Private Limited. Shareholding Pattern as on March 31, 2012 Category Promoters Indian Foreign Sub-Total Foreign Institutional Investors (FIIs) Individuals Others Mutual Funds Banks / Financial Institutions Central/State Governments Insurance Companies Bodies Corporate Trust NRI Clearing Members Overseas Corporate Bodies Sub-Total Total No. of Shares held 106,984,230 90,850,440 197,834,670 46,236,644 12,127,123 178,525 28,380 660 1,702,757 5,263,840 248,761 651,722 127,387 4,680 8,206,712 264,405,149 Percentage of Shareholding 40.46 34.36 74.82 17.49 4.59 0.07 0.01 0.00 0.64 1.99 0.09 0.25 0.05 0.00 3.10 100.00
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Pie-chart of Shareholding Pattern (Individuals) 4.59% (Others) 3.10% (FIIs) 17.49%
74.82% (Promoter & Group)
The particulars of Equity Shares of the Company held by the Directors are furnished below: Sl. No. 1. 2. Name Dr. Vijay Mallya Mr. Kalyan Ganguly Number of Equity Shares held As on March 31, 2012 21,353,620 14,690 As on March 31, 2011 21,353,620 14,690
DEMATERIALIZATION OF SHARES The Company has set up requisite facilities for dematerialization of its Equity Shares in accordance with the provisions of the Depositories Act, 1996 with National Securities Depository Limited and Central Depository Services (India) Limited. The Company has entered into agreements with both the Depositories for the benefit of Shareholders. The status of Dematerialization of the Companys Shares as on March 31, 2012 is as under: Mode Physical mode Electronic mode TOTAL No. of Shares 5,178,047 258,517,524 263,695,571 % age 1.97 98.03 100.00 No. of Shareholders 21,156 22,781 43,937
709,578 Equity Shares allotted on 12.03.2012 upon amalgamation were pending credit into Demat accounts of the aloottees as on 31.03.2012. Shares held in physical and demat form as on March 31, 2012
1.97% (Physical mode)
(Electronic mode) 98.03%
For any assistance regarding Share Transfers, Transmissions, change of address, issue of duplicate / lost Share Certificates / exchange of Share Certificate / Dematerialization and other relevant matters, please write to the Registrar and Share Transfer Agent of the Company, at the address given below:
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INTEGRATED ENTERPRISES (INDIA) LIMITED (FORMERLY KNOWN AS ALPHA SYSTEMS PRIVATE LIMITED), 30, RAMANA RESIDENCY, 4TH CROSS, SAMPIGE ROAD, MALLESWARAM, BANGALORE 560 003. Tel. No.: (080) 2346 0815 to 2346 0818 Fax No.: (080) 2346 0819 email: alfint@vsnl.com Contact Persons: MR. VIJAYAGOPAL or MR. RAJARAMAN Investors can also post their queries to ublinvestor@ubmail.com
OWN MANUFACTURING NETWORK ANDHRA PRADESH MALLEPALLY, KOTHLAPUR & SRIKAKULAM GOA PONDA KERALA CHERTHALA & PALAKKAD KARNATAKA MANGALORE, NELMANGALA & MYSORE ODISHA KHURDA TAMIL NADU KUTHAMBAKKAM & ARANVOYAL PUNJAB LUDHIANA WEST BENGAL KALYANI RAJASTHAN CHOPANKI MAHARASHTRA TALOJA & AURANGABAD HARYANA DHARUHERA CONTRACT MANUFACTURING NETWORK In addition, the Company also has Manufacturing facilities through Contract Breweries at Aligarh, Alwar, Bhopal, Daman, Gauhati, Ghaziabad, Indore, Lucknow and Rangpo. REGISTERED OFFICE: UB TOWER, UB CITY, 24, VITTAL MALLYA ROAD, BANGALORE - 560 001. Phone: (91-80) 39855000, 22272806 & 22272807 Fax No. (91-80) 22211964 - 22229488 Cable: UBEEGEE B. NON-MANDATORY REQUIREMENTS a) Chairman of the Board: The Chairman of the Board is entitled to maintain a Chairmans office at the Companys expense and allowed reimbursement of expenses incurred in performance of his duties. b) Remuneration Committee: The Company has set up a remuneration Committee. c) Shareholder Rights: The Companys half yearly results are published in English and Kannada Newspapers having wide circulation and are also displayed on the Companys website. Press releases are also issued which are carried by a few newspapers and also displayed on the Companys website. Hence, same are not sent to the shareholders. d) Green initiative: The Green Initiative is paperless compliances by Companies i.e. servicing documents through electronic mode. The Company has adopted green initiative and therefore started communicating through email to shareholders having registered their email ids. e) Audit Qualifications: There are no qualifications or adverse remarks in Auditors Report which require any clarification or explanation.
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f) Training of Board Members: Having regard to the seniority and expertise in their respective areas of specialization, their training is not considered necessary for the time being. g) Mechanism for evaluating Non-Executive Directors: The Board may at its discretion consider such requirement in future. h) Whistle Blower Policy: Though covered briefly in the code of conduct adopted by the Company, the Board may consider adopting a separate mechanism for Whistle Blower Policy in future.
COMPLIANCE WITH CODE OF BUSINESS CONDUCT AND ETHICS In accordance with Clause 49 sub-clause (I) (D) (ii) of the Listing Agreement, it is hereby confirmed that during the year 2011- 2012, all the members of the Board of Director and Senior Managerial personnel have affirmed their Compliance with the Companys Code of Business Conduct and Ethics.
Place: Bangalore Date: June 08, 2012
COMPLIANCE CERTIFICATE To the Members of UNITED BREWERIES LIMITED
Certificate of Compliance with the conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement We have examined the compliance of conditions of Corporate Governance by United Breweries Limited for the year ended on March 31, 2012, as stipulated in Clause 49 of the Listing Agreement of the said company with Stock Exchanges in India. The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to procedures and implementation thereof, adopted by the company for ensuring the compliance of the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the company. In our opinion and to the best of our information and according the explanations given to us, we certify that the company has complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement. We state that in respect of investor grievances received during the year ended on March 31, 2012, no grievances are pending against the company as per records maintained by the company and presented to the Shareholders/Investors Grievance Committee. We further state that such compliance is neither an assurance as to future viability of the company nor the efficiency or effectiveness with which the management has conducted the affairs of the company.
Bangalore, June 08, 2012
M R Gopinath Company Secretary (In practice) Bangalore FCS 3812 CP 1030
28
Auditors Report
To the Members of United Breweries Limited 1. We have audited the attached Balance Sheet of United Breweries Limited (the Company) as at March 31, 2012, and the related Statement of Profit and Loss and Cash Flow Statement for the year ended on that date annexed thereto, which we have signed under the reference to this report. These financial statements are the responsibility of the Companys Management. Our responsibility is to express an opinion on these financials statements based on our audit. 2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by Management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. 3. As required by the Companies (Auditors Report) Order, 2003, as amended by the Companies (Auditors Report) (Amendment) Order, 2004 (together the Order), issued by the Central Government of India in terms of sub-Section (4A) of Section 227 of The Companies Act, 1956 of India (the Act) and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order. 4. We draw your attention to Note 38(I)(B) to the attached financial statements regarding the recognition of gains, aggregating Rs.14,049 lakhs, on sale of equity shares of the Company during the year by UBL Benefit Trust, of which the Company is the sole beneficiary, by way of credit to General Reserves Account in the absence of any specific accounting treatment being prescribed in the Accounting Standards notified pursuant to the Companies (Accounting Standards) Rules, 2006 as per section 211 (3C) of The Companies Act, 1956. Our conclusion is not qualified in this respect. 5. Further to our comments in the Annexure referred to in paragraph 3 above. we report that: (a) We have 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 appears from our examination of those books; (c) The Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report are in agreement with the books of account; (d) In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Act; (e) On the basis of written representations received from the directors, as on March 31, 2012 and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2012 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Act; (f) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements together with the notes thereon and attached thereto give, in the prescribed manner, the information required by the Act, and give a true and fair view in conformity with the accounting principles generally accepted in India: (i) in the case of Balance Sheet, of the state of affairs of the company as at March 31, 2012; (ii) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and (iii) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date. For Price Waterhouse Firm Registration Number 007568 S Chartered Accountants Usha A Narayanan Partner Membership Number 23997
29
Annexure to Auditors Report

Referred to in paragraph 3 of the Auditors Report of even date to the members of United Breweries Limited on the financial statements as of and for the year ended March 31, 2012. 1. (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation, of fixed assets. (b) The fixed assets are physically verified by the Management according to a phased programme designed to cover all the items over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the Management during the year except for asset aggregating to Rs.5,097 (original cost in lakhs) and Rs.2,828 (written down value in lakhs) at one location of the Company, and no material discrepancies between the book records and the physical inventory have been noticed. (c) In our opinion, and according to the information and explanations given to us, a substantial part of fixed assets has not been disposed of by the Company during the year. 2. (a) The inventory (excluding stocks with third parties) has been physically verified by the Management during the year. In respect of inventory lying with third parties, these have substantially been confirmed by them. In our opinion, the frequency of verification is reasonable. (b) In our opinion, the procedures of physical verification of inventory followed by the Management are reasonable and adequate in relation to the size of the Company and the nature of its business. (c) On the basis of our examination of the inventory records, in our opinion, the Company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material. 3. (a) The Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under Section 301 of the Act. (b) The Company has not taken any loans secured or unsecured, from companies, firms or other parties covered in the register maintained under Section 301 of the Act. 4. In our opinion, and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us, we have neither come across, nor have been informed of, any continuing failure to correct major weaknesses in the aforesaid internal control system. 5. (a) In our opinion, and according to the information and explanations given to us, the particulars of contracts or arrangements referred to in Section 301 of the Act have been entered in the register required to be maintained under that section. (b) In our opinion, and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees Five Lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time. 6. The Company has not accepted any deposits from the public within the meaning of Sections 58A and 58AA of the Act and the rules framed there under. 7. In our opinion, the Company has an internal audit system commensurate with its size and the nature of its business. 8. The Central Government of India has not prescribed the maintenance of cost records under clause (d) of sub-section (1) of Section 209 of the Act for any of the products of the Company. 9. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing undisputed statutory dues in respect of income tax, service tax, provident fund and employees state insurance, though there has been a slight delay in a few cases, and is regular in depositing undisputed statutory dues, including investor education and protection fund, wealth tax, customs duty, excise duty and other material statutory dues, as applicable, with the appropriate authorities. (b) According to the information and explanations given to us and the records of the Company examined by us, the particulars of dues of income tax, sales tax, wealth tax, service tax, customs duty and excise duty as at March 31, 2012 which have not been deposited on account of a dispute, are given in Annexure 1. 10. The Company has no accumulated losses.
30
Annexure to Auditors Report (contd.)

11. According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of dues to any financial institution or bank or debenture holders as at the balance sheet date. 12. In our opinion, the Company has maintained adequate documents and records in the cases where the Company has granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities. 13. The provisions of any special statute applicable to chit fund/ nidhi/ mutual benefit fund / societies are not applicable to the Company. 14. In our opinion, the Company is not a dealer or trader in shares, securities, debentures and other investments. 15. In our opinion, and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions during the year. 16. In our opinion, and according to the information and explanations given to us, the term loans have been applied, on an overall basis, for the purposes for which they were obtained. 17. On the basis of an overall examination of the balance sheet of the Company, in our opinion, and according to the information and explanations given to us, there are no funds raised on a short- term basis which have been used for long-term investment. 18. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Act during the year. 19. The Company has not issued any debentures during the year; and does not have any debentures outstanding as at the year end. 20. The Company has not raised any money by public issues during the year. 21. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of any such case by the Management, except for fraudulent tampering and misappropriations of cheques drawn in favor of the Company aggregating to Rs.16 lakhs, in respect of which Company has initiated legal action.
For Price Waterhouse Firm Registration Number 007568 S Chartered Accountants Usha A Narayanan Partner Membership Number 23997
31
Appendix 1 to the Auditors Report

Referred to in paragraph 9 (b) of the Annexure to the Auditors report of even date to the members of United Breweries Limited on the financial statements for the year ended March 31, 2012.
Name of the statute Sales Tax Acts Amount (Rs. In Lakhs) 42 381 697 6 1 11 1 1 54 1 1 1 1 3 5 5 8 63 3 48 3 10 5 Customs Act 20 30 51 Central Excise Act 5 3 43 11 State Excise Act 12 3 37 40 19 81 6 30 1 Period to which the amount relates 1997-98 2003-04 & 2004-05 2005-06 to 2010-11 1983-84 to 1986-87 1990-91 2002-03 1990-91 2002-03 1975-76 to 1998-99, 2000-01 to 2001-02 2001-02 2000-01 1991-92 1988-89 1989-90 1990-91 2001-02 1975 to 1994 1991-92 2003-04 1991-92 1993 to 2003 2005-06 to 2007-08 2008-09 1991-92 1998-99 1991-92 2005- 2007 2007- 2008 1998-99 1987-88 1981-82 2000-01 to 2003-04 2004-05 2000 to 2005 1981- 82 &1987-88 2000-01 to 2003-04, 2005-06 1988-89 1998-99 2009-10 Forum where the dispute is pending Additional Commissioner, Commercial Taxes High Court of Karnataka JCCT Appeals Bangalore High Court of Kerala High Court of Kerala Sales Tax Appellate Tribunal, Karnataka Sales Tax Appellate Tribunal, Mumbai Assistant Commissioner (Assessment) Special Circle Sales Tax Appellate Tribunal / Deputy Commissioner (Appeals) Deputy Commissioner of Commercial Taxes (Appeals) Kollam Deputy Commissioner of Commercial Taxes (Appeals) Kollam Deputy Commissioner Appeals High Court of Kerala High Court of Kerala High Court of Kerala Court of Civil Judge, (Senior Division), Gurgaon Appellate Tribunal, Cherthala Sales Tax Appellate Tribunal Sales Tax Appellate Tribunal Sales Tax Appellate Tribunal Sales Tax Appellate Tribunal High Court of Andhra Pradesh J C Appeal, Commercial Taxes, Patna Bihar Commissioner of Customs High Court of Madras Commissioner of Customs, Ludhiana Commissioner (Appeals) Central Excise Commissioner (Appeals) Central Excise High Court of Calcutta Commissioner of Central Excise High Court of Calcutta Excise Commissioner, Karnataka High Court of Karnataka High Court of Karnataka High Court of Calcutta High Court of Karnataka High Court of Calcutta High Court of Calcutta DEO, Nagaur, Rajasthan
32
Appendix 1 to the Auditors Report (contd.)

Referred to in paragraph 9 (b) of the Annexure to the Auditors report of even date to the members of United Breweries Limited on the financial statements for the year ended March 31, 2012.
Name of the statute Service Tax Act Income Tax Act Amount (Rs. In Lakhs) 3,778 3,736 358 567 152 1,066 505 640 137 73 29 995 166 579 375 368 307 142 512 368 111 374 26 15 14 8 6 66 345 8 168 939 734 88 Provident Fund Act Employee State Act 13 3 3 Period to which the amount relates 2004-05 to 2007-08 2008-09 to 2010-11 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 1997-98 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2002-03 2003-04 2004-05 2005-06 2006-07 2008-09 2001-02 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2006-07 2007-08 2008-09 2009-10 1998 to 2000 2009-10 1991-92 Forum where the dispute is pending Director General Central Excise & Intelligence, Bangalore Commissioner of Service Tax, Bangalore High Court of Karnataka Income Tax Appellate Tribunal, Bangalore Commissioner of Income Tax (Appeals) Commissioner of Income Tax (Appeals) Commissioner of Income Tax (Appeals) Commissioner of Income Tax (Appeals) Commissioner of Income Tax (Appeals) Commissioner of Income Tax (Appeals) High Court of Madras DCIT DCIT DCIT DCIT DCIT Commissioner of Income Tax (Appeals) Commissioner of Income Tax (Appeals) Commissioner of Income Tax (Appeals) Commissioner of Income Tax (Appeals) Income Tax Appellate Tribunal Commissioner of Income Tax (Appeals) Commissioner of Income Tax (Appeals) Income Tax Appellate Tribunal Income Tax Appellate Tribunal Income Tax Appellate Tribunal Commissioner of Income Tax (Appeals) Commissioner of Income Tax (Appeals) Commissioner of Income Tax (Appeals) Commissioner of Income Tax (Appeals) Commissioner of Income Tax (Appeals) Commissioner of Income Tax (Appeals) Commissioner of Income Tax (Appeals) Commissioner of Income Tax (Appeals) Employees Provident Fund Tribunal Employee State Insurance Court, Bangalore High Court of Kerala
33
Balance Sheet as at March 31, 2012

(All amounts in Rs.lacs, unless otherwise stated) Note EQUITY AND LIABILITIES Shareholders' funds Share capital Reserves and surplus Share capital pending allotment Non-current liabilities Long-term borrowings Deferred tax liabilities (Net) Long-term provisions Current liabilities Short-term borrowings Trade payables Other current liabilities Short-term provisions TOTAL ASSETS Non-current assets Fixed assets Tangible assets Intangible assets Capital work-in-progress Non-current investments Interest in UBL Benefit Trust (Refer Note 38) Long-term loans and advances Other non-current assets Current assets Inventories Trade receivables Cash and bank balances Short-term loans and advances Other current assets TOTAL The notes referred above form an integral part of these financial statements. This is the Balance Sheet referred to in our report of even date. For and on behalf of the Board of Directors of United Breweries Limited Kalyan Ganguly Managing Director Govind Iyengar Senior Vice PresidentLegal & Company Secretary Bangalore, June 8, 2012 Guido de Boer Director, CFO As at March 31, 2012 As at March 31, 2011
3 4 5 6 7 8
10,051 126,463 136,514 40,280 5,140 1,108 46,528 43,550 57,426 41,229 4,011 146,216 329,258
27,235 102,174 129,409 92 27,472 2,888 704 31,064 34,016 39,056 42,842 3,941 119,855 280,420
9 10 11 8
12 119,837 2,032 20,735 2,547 14,376 1,166 160,693 39,988 69,997 17,723 29,265 11,592 168,565 329,258 106,209 2,732 7,195 4,502 14,294 11,985 1,086 148,003 28,980 51,986 12,906 29,122 9,423 132,417 280,420
13 14 15
16 17 18 14 19
For Price Waterhouse Firm Registration Number: 007568 S Chartered Accountants Usha A Narayanan Partner Membership No. -23997 Bangalore, June 8, 2012
34
Statement of Profit and Loss for the year ended March 31, 2012
(All amounts in Rs.lacs, unless otherwise stated) Note Income Revenue from operations (gross) Less: Excise duty Revenue from operations (net) Other income Total revenue (I) Expenses Cost of materials consumed Purchases of stock-in-trade Changes in inventories of finished goods, work-in-progress and stock-in-trade Employee benefits expense Other expenses Total expenses (II) Earnings before interest, tax, depreciation and amortisation (I-II) Finance costs Depreciation and amortisation expense Profit before Exceptional Items and Tax Exceptional Item: Provision for dimunition in investments in subsidiary Profit before tax Tax expense: (1) Current tax (2) MAT credit (availed) / utilised (3) Deferred tax charge / (write back) Profit for the period Earnings per Equity share in Rs. [Nominal value per share Re.1 each (2011: Re.1 each)] (1) Basic (2) Diluted The notes referred above form an integral part of the financial statements. This is the Statement of Profit and Loss referred to in our report of even date. For Price Waterhouse Firm Registration Number: 007568 S Chartered Accountants Usha A Narayanan Partner Membership No. -23997 Bangalore, June 8, 2012 For and on behalf of the Board of Directors of United Breweries Limited Kalyan Ganguly Managing Director Govind Iyengar Senior Vice PresidentLegal & Company Secretary Bangalore, June 8, 2012 Guido de Boer Director, CFO 37 4.68 4.68 5.26 5.26 4,925 1,137 3,060 12,644 4,765 (4,762) 7,890 14,729 13 31 12 26 27 28 29 30 160,376 4,230 (1,825) 18,823 139,960 321,564 48,503 9,912 14,866 23,725 1,959 21,766 133,258 6,007 337 14,411 112,981 266,994 43,486 7,813 13,051 22,622 22,622 25 24 586,494 223,725 362,769 7,298 370,067 460,450 154,469 305,981 4,499 310,480 Year ended March 31, 2012 March 31, 2011
35
Cash Flow Statement for the year ended March 31, 2012
(All amounts in Rs.lacs, unless otherwise stated) Year ended March 31, 2012 A Cash flow from operating activities Profit before taxation Adjustments for: Depreciation and amortisation (Profit) / Loss on sale of assets Provision for doubtful debts Provision for doubtful advances Provision for dimunition in investments Bad debts written off Bad advances written off Provision for doubtful debts no longer required written back Provision for doubtful advances no longer required written back Interest expenses (Net) Interest income Exchange Loss / (Gains) on foreign currency loans Dividend income Operating profits before working capital changes Adjustment for working capital changes: (Increase) / Decrease in Trade Receivables (Increase) / Decrease in inventories Increase / (Decrease) in current liabilities and provisions (Increase) / Decrease in other current assets, loans and advances Cash generated from operations Direct taxes (Income Tax and Fringe Benefit Tax) paid (including TDS) Cash generated from operations before non-recurring items Non-recurring items Net cash generated from operating activities B Cash flow from investing activities Purchase of fixed assets (including acquisition on amalgamation) Sale of fixed assets (Purchase) / Sale of investments Interest income Dividend income Net cash used in investing activities (38,141) 79 (3) 3,534 19 (34,512) (52,880) 124 4,900 80 42 (47,734) 14,866 (1) 49 64 1,959 954 980 (1,290) (998) 9,872 (3,300) 40 (19) 21,766 13,051 (2) 317 17 9 (9) 7,601 (3,166) 213 (42) 22,621 March 31, 2011
23,176 44,942
17,989 40,610
(17,187) (10,663) 27,689 (2,894) (3,055) 41,887 (6,588) 35,299 35,299
9,943 (9,378) 30,761 (1,985) 29,341 69,951 (5,168) 64,783 64,783
36
Cash Flow Statement for the year ended March 31, 2012 (contd.)
(All amounts in Rs.lacs, unless otherwise stated) Year ended March 31, 2012 C Cash Flow from Financing activities (Repayment) / Proceeds from unsecured term loans (net) (Repayment) / Proceeds from bank borrowings (net) On merger Repayment of preference share capital Advance to subsidiary companies and others Proceeds from UBL Benefit Trust Interest paid Dividend paid (including distribution tax) Net cash generated from financing activities Net Increase/(Decrease) in cash and cash equivalents Opening cash and cash equivalents Cash on hand including remittances in transit Bank Balances including cheques on hand Cash and cash equivalents of transferor company as at April 1, 2011 Closing cash and cash equivalents Cash on hand including remittances in transit Bank balances including cheques on hand Notes: 1. The above cash flow statement has been compiled from and is based on the balance sheet as at March 31, 2012 and the related profit and loss account for the year ended on that date. 2. The above Cash Flow Statement has been prepared in consonance with the requirements of Accounting Standard (AS)-3 on Cash Flow Statements as notified under the Companies (Accounting Standards) Rules, 2006 and the reallocations required for the purpose are as made by the Company. 3. Cash and cash equivalents include Rs.465 (2011: Rs.1,706) which are not available for use by the Company. This is the Cash Flow Statement referred to in our report of even date For Price Waterhouse Firm Registration Number: 007568 S Chartered Accountants Usha A Narayanan Partner Membership No. -23997 Bangalore, June 8, 2012 For and on behalf of the Board of Directors of United Breweries Limited Kalyan Ganguly Managing Director Govind Iyengar Senior Vice PresidentLegal & Company Secretary Bangalore, June 8, 2012 Guido de Boer Director, CFO (19,033) 24,440 (17,283) 28,343 (9,776) (2,678) 4,013 4,800 34 12,872 12,906 17 34 17,689 17,723 20,232 (9,107) (14,785) 839 (7,777) (1,874) (12,472) 4,575 28 8,303 8,331 34 12,872 12,906 March 31, 2011
37
Notes to Financial Statements

(All amounts in Rs.lacs, unless otherwise stated) 1. General Information: United Breweries Limited (UBL) is engaged primarily in the manufacture and sale of beer. The Company has manufacturing plants in India and sells its product only in India. The Company is a public limited Company and is listed on the Bombay Stock Exchange (BSE), Bangalore Stock Exchange (BgSE) and the National Stock Exchange (NSE). 2. Summary of Significant Accounting Policies
2.1 Basis of Presentation of Financial Statements The Financial Statements of the Company have been prepared under historical cost convention, to comply in all material aspects with the applicable accounting principles in India, the applicable accounting standards notified under Section 211(3C) of the Companies Act, 1956 and with the relevant provisions of the Companies Act, 1956. All assets and liabilities have been classified as current or non-current as per the Companys normal operating cycle and other criteria set out in the Schedule VI to the Companies Act, 1956. Based on the nature of products and the time between the 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 non current classification of assets and liabilities. 2.2 Use of Estimates: The preparation of the Financial Statements in conformity with Generally Accepted Accounting Principles in India that requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent liabilities as at the date of the Financial Statements, and the reported amounts of revenue and expenses during the reported period. Actual result could differ from those estimates. 2.3 Revenue Recognition: Revenue from sale of goods is recognised in accordance with the terms of sale, on dispatch from the Breweries/ warehouses of the Company and is net of trade discount & Value Added Tax (VAT) where applicable but includes Excise Duty. Income from brand franchise is recognised at contracted rates on sale/production of the branded products by the franchisees. Dividend Income is recognised when the Companys right to receive the payment is established on or before the balance sheet date. Royalty from foreign entities (net of tax) is recognised as per the terms of agreement. Interest income is recognised on accrual basis. 2.4 Borrowing Costs: Borrowing costs incurred for the acquisition of qualifying assets are recognised as part of cost of such assets when it is considered probable that they will result in future economic benefits to the Company while other borrowing costs are expensed in the period in which they are incurred. 2.5 Fixed Assets: Fixed assets are stated at their original cost of acquisition and subsequent improvements thereto including taxes, duties, freight and other incidental expenses relating to acquisition and installation of such assets. 2.6 Investments: Investments that are readily realisable and are intended to be held for not more than one year from the date, on which such investments are made, are classified as current investments. All other investments are classified as long term investments. Current investments are carried at cost or fair value, whichever is lower. Long-term investments are carried at cost. However, provision for diminution is made to recognise a decline, other than temporary, in the value of the investments, such reduction being determined and made for each investment individually. 2.7 Inventories: Inventories are valued at lower of cost and net realisable value. Costs include freight, taxes, duties and appropriate production overheads and are generally ascertained on the First in First Out (FIFO) basis. Excise/Customs duty on stocks in bond is added to the cost. Due allowance is made for obsolete and slow moving items. 2.8 Foreign Currency Transactions: a) Foreign currency transactions are recorded at the rates of exchange prevailing on the dates of such transactions.
38
Notes to Financial Statements (contd.)

(All amounts in Rs.lacs, unless otherwise stated) b) All monetary assets and liabilities in foreign currency are restated at the end of accounting period. With respect to long-term foreign currency monetary items, from April 1, 2011 onwards, the Company has adopted the following policy: Foreign exchange difference on account of a depreciable asset, is adjusted in the cost of the depreciable asset/CWIP , which would be depreciated over the balance life of the asset. In other cases, the foreign exchange difference is accumulated in a Foreign Currency Monetary Item Translation Difference Account, and amortised over the balance period of such long term asset/ liability.
A monetary asset or liability is termed as a long-term foreign currency monetary item, if the asset or liability is expressed in a foreign currency and has a term of 12 months or more at the date of origination of the asset or liability. Exchange differences on restatement of all other monetary items are recognised in the Statement of Profit and Loss. The premium or discount arising att the inception of forward exchange contracts entered into to hedge an existing asset/liability, is amortised as expense over the life of the contract. Exchange differences on such a contract are recognised in the Statement of Profit and Loss in the reporting period. Any profit or loss arising on cancellation or renewal of such a forward exchange contract are recognised as income or as expense for the period. Forward exchange contracts outstanding as at the year end on account of firm commitment/highly probable forecast transactions are marked to market and the losses, if any, are recognised in the Statement of Profit and Loss and gains are ignored in accordance with the Announcement of Institute of Chartered Accountants of India on Accounting for Derivatives issued in March 2008. 2.9 Depreciation and amortisation: Depreciation on fixed assets is provided on Straight Line Method based on the rates prescribed under Schedule XIV to the Companies Act, 1956 except as indicated below: a) Plant and Machinery are depreciated at the rate of 10.34%. Further, depreciation is provided at higher rates in respect of certain specific items of plant and machinery having lower useful life based on technical evaluation carried out by the management. b) Assets acquired on amalgamation (where original dates of acquisition are not readily available), are depreciated over the remaining useful life of the assets as certified by an expert. c) Cost of Goodwill arising on amalgamation is amortised over a period of 5 years. d) Other intangible assets are amortised on straight line basis over a period of 10 years. e) Cost of Leasehold Land is amortised over the period of lease. f) Assets purchased/sold during the year are depreciated from the month of purchase / until the month of sale of asset on a proportionate basis. 2.10 Employee benefits: (i) Defined-contribution plans: Provident Fund: Contribution towards provident fund for certain employees is made to the regulatory authorities, where the Company has no further obligations. Such benefits are classified as Defined Contribution Schemes as the Company does not carry any further obligations, apart from the contributions made on a monthly basis. Contributions to the Employees Provident Fund, Superannuation Fund, Employees State Insurance and Employees Pension Scheme are as per statute and are recognised as expenses during the period in which the employees perform the services. (ii) Defined-benefit plans: Provident fund: In respect of certain employees, Provident Fund contributions are made to a Trust administered by the Company. The Companys liability is actuarially determined (using the Projected Unit Credit method) at the end of the year and any shortfall in the fund size maintained by the Trust set up by the Company is additionally provided for. Actuarial losses /gains are recognised in the Statement of Profit and Loss in the year in which they arise.
39

(All amounts in Rs.lacs, unless otherwise stated) Gratuity: Liability towards gratuity is determined on actuarial valuation using the Projected Unit Credit Method at the balance sheet date. Actuarial Gains and Losses are recognised immediately in the Statement of Profit and Loss. (iii) Other long term employee benefits: Liability towards leave encashment and compensated absences is recognised at the present value based on actuarial valuation at each balance sheet date. (iv) Short term employee benefits: Undiscounted amount of liability towards earned leave, compensated absences, performance incentives etc. is recognised during the period when the employee renders the services. 2.11 Taxation: Current tax is determined as per the provisions of the Income Tax Act, 1961. (i) Provision for current tax is made, based on the tax payable under the Income Tax Act.1961. Minimum Alternative Tax (MAT) credit, which is equal to the excess of MAT (calculated in accordance with the provisions of section 115JB of the Income Tax Act, 1961) over normal income-tax is recognized as an asset by crediting the Statement of Profit and Loss only when and to the extent there is convincing evidence that the Company will be able to avail the said credit against normal tax payable during the period of ten succeeding assessment years. (ii) Deferred tax is recognised, on timing differences, being the difference between taxable income and accounting income that originates in one period and is capable of reversal in one or more subsequent periods. Deferred tax assets are not recognised unless there is virtual / reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. 2.12 Earnings per share: Annualised earnings / (loss) per equity share (basic and diluted) is arrived at based on ratio of profit / (loss) attributable to equity shareholders to the weighted average number of equity shares. 2.13 Impairment of Assets: At each Balance Sheet date, the Company assesses whether there is any indication that assets may be impaired. If any such indication exists, the Company estimates the recoverable amount. If the carrying amount of the asset exceeds its recoverable amount, an impairment loss is recognised in the accounts to the extent the carrying amount exceeds the recoverable amount. 2.14 Provisions, Contingent Liabilities and Contingent Assets: Provisions are recognised when the company has a present obligation as a result of past events, for which it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate of the amount can be made. Provisions are reviewed regularly and are adjusted where necessary to reflect the current best estimates of the obligation. When the company expects a provision to be reimbursed, the reimbursement is recognised as a separate asset, only when such reimbursement is virtually certain. A disclosure for contingent liability is made where there is a possible obligation or present obligation that may probably not require an outflow of resources. 2.15 Leases Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to the Statement of Profit and Loss on a straight-line basis over the period of the lease.
40

(All amounts in Rs.lacs, unless otherwise stated) As at March 31, 2012 3. SHARE CAPITAL Authorised 3,674,000,000 (2011: 3,620,000,000) Equity shares of Re.1 each 58,600,000 (2011: 49,140,000) Preference Shares of Rs.100 each Issued, Subscribed and Paid-up 264,405,149 (2011: 254,544,938) Equity shares of Re.1 each fully paid 3% Nil (2011: 17,283,000) Cumulative Redeemable Preference Shares of Rs.100 each fully paid - Series A 3% 7,407,000 (2011: 7,407,000) Cumulative Redeemable Preference Shares of Rs.100 each fully paid - Series B 2,644 7,407 10,051 2,545 17,283 7,407 27,235 36,740 58,600 95,340 36,200 49,140 85,340 As at March 31, 2011
Cumulative Redeemable Preference Shares - Series A are redeemable at par at the earliest on March 31, 2011 and are extendable upto March 31, 2015 based on mutual agreement between the Company and Scottish and Newcastle India Limited (the preference shareholder). The shares have been redeemed at par on April 14, 2011. Cumulative Redeemable Preference Shares - Series B are redeemable at par at the earliest on March 31, 2015. a) Reconciliation of number of shares Equity Shares Balance as at the beginning of the year Issued during the year - amalgamations (Refer Note 38) Scottish & Newcastle India Private Limited at the ratio of 6:31 in lieu of equity shares of Millennium Alcobev Pvt. Ltd. UBL Benefit Trust at the ratio of 33:16 in lieu of equity shares of Empee Breweries Ltd. Heineken International B.V. at the ratio of 135:1 in lieu of equity shares of UB Ajanta Breweries Pvt. Ltd. UB Overseas Limited at the ratio of 135:1 in lieu of equity shares of UB Ajanta Breweries Pvt. Ltd. Heineken International B.V. at the ratio of 454:1 in lieu of equity shares of UB Nizam Breweries Pvt. Ltd. UB Overseas Limited at the ratio of 454:1 in lieu of equity shares of UB Nizam Breweries Pvt. Ltd. United Spirits Limited at the ratio of 30:17 in lieu of equity shares of Chennai Breweries Pvt. Ltd. Public shareholders of erstwhile Millennium Beer Industries Limited at the ratio of 12:1 Outstanding at the end of the year * Rounded off to Rs.2,644 As at March 31, 2012 Nos. 254,544,938 Rs. As at March 31, 2011 Nos. Rs. 2,400
2,545 240,048,255
354,789 354,789 72,951 72,951 8,500,000 504,731 264,405,149
4 4 1 1 85 5
8,489,270 6,007,413
85 60 2,545
2,644* 254,544,938
41

(All amounts in Rs.lacs, unless otherwise stated) Preference Shares Preference shares - Series A Balance as at the beginning of the year Issued during the year Redeemed during the year Outstanding at the end of the year Preference shares - Series B Balance as at the beginning of the year Issued during the year Redeemed during the year Outstanding at the end of the year 7,407,000 7,407,000 7,407 7,407 7,407,000 7,407,000 7,407 7,407 17,283,000 17,283,000 17,283 17,283 17,283,000 17,283,000 17,283 17,283 As at March 31, 2012 Nos. Rs. As at March 31, 2011 Nos. Rs.
b) Rights, preferences and restrictions attached to shares Equity Shares: The company has one class of equity shares having a par value of Re.1 per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to thteir shareholding. 3% Redeemable preference shares - Series A: 172,83,000, 3% Redeemable preference shares of Rs.100 each were issued in April 2005 to the Scottish & Newcastle India Limited. These shares have been redeemed on April 14, 2011. In the event of liquidation, the preference shareholders are eligible to receive the paid up value of the preference shares along with arrears of preference dividend, if any out of the remaining assets of the company in preference to equity shareholders. 3% Redeemable preference shares - Series B: 74,07,000, 3% Redeemable preference shares of Rs.100 each were issued in April 2005 to the Scottish & Newcastle India Limited. These shares are redeemable at par at the earliest on March 31, 2015. In the event of liquidation, the preference shareholders are eligible to receive the paid up value of the preference shares along with arrears of preference dividend, if any out of the remaining assets of the company in preference to equity shareholders. c) Details of shares held by shareholders holding more than 5% of the aggregate shares in the Company As at March 31, 2012 Nos. Equity shares of Re.1 each fully paid Scottish & Newcastle India Limited United Breweries Holdings Limited Dr. Vijay Mallya Preference shares of Rs.100 each fully paid Series A Scottish & Newcastle India Limited Preference shares of Rs.100 each fully paid Series B Scottish & Newcastle India Limited 89,994,960 30,295,911 21,353,620 34.04% 11.46% 8.09% 89,994,960 30,295,911 21,353,620 35.36% 11.90% 8.39% % holding in the class As at March 31, 2011 Nos. % holding in the class
24,690,000
100.00%
7,407,000
100.00%
7,407,000
100.00%
42

(All amounts in Rs.lacs, unless otherwise stated) d) Shares allotted as fully paid up pursuant to contract(s) without payment being received in cash (during 5 years immediately preceding March 31, 2012). 2011-12: 9,860,211 equity shares issued on account of amalgamation of Chennai Breweries Private Limited, UB Nizam Breweries Private Limited, Millennium Beer Industries Limited and UB Ajanta Breweries Private Limited. 2010-11: 14,496,683 equity shares issued on account of amalgamation of Millennium Alcobev Private Limited and Empee Breweries Limited. As at March 31, 2012 4. RESERVES AND SURPLUS Securities premium account Capital reserve Opening balance Add: Additions on amalgamations [Refer Note 38(I)(A)] Less: Deductions on amalgamations [Refer Note 38(I)(A)] Closing balance General reserve Opening balance Add: Transferred from surplus in Statement of Profit and Loss Add: Gain on sale of interest in UBL Benefit Trust [Refer Note 38(I)(B)] Closing balance Surplus in Statement of Profit and Loss Opening balance Add: Profit for the year Less: Appropriations - Proposed dividends (Refer Note 22) - Transfer to General reserve Closing balance Total Reserves and Surplus 2,432 1,500 40,210 126,463 2,700 1,500 31,498 102,174 31,498 12,644 20,969 14,729 4,200 1,500 14,049 19,749 2,700 1,500 4,200 1,258 28 1,286 1,258 1,258 65,218 65,218 As at March 31, 2011
5. SHARE CAPITAL PENDING ALLOTMENT Nil (2011: 9,150,633) Equity shares of Re.1 each pending allotment [Refer Note 38(II)] 92
43

(All amounts in Rs.lacs, unless otherwise stated) 6. LONG-TERM BORROWINGS Non-current portion Current portion
As at As at As at As at March 31, 2012 March 31, 2011 March 31, 2012 March 31, 2011 Secured borrowings Foreign currency term loans External commercial borrowing from banks Term loan from banks Indian currency term loans from banks Other loans Unsecured borrowings From banks Deferred payment liabilities Amount disclosed under the head "Other Current Liabilities" (Note 11) Total 4,470 4,470 40,280 19,033 4,470 23,503 27,472 1,533 1,533 (3,858) 1,533 1,533 (16,317) 35,810 35,810 625 3,344 3,969 625 1,700 2,325 4,656 3,756 5,316 1,056 14,784
Nature of security and terms of repayment for secured borrowings Nature of security Foreign currency term loans HDFC Bank Ltd: Rs.625 (2011: Rs.3,125) secured by Repayable in 16 quarterly instalments from the date of first pari-passu charge on all moveable and immoveable loan (June 2008) along with interest of 9.45% per annum properties of the company except Taloja, Aurangabad, (fully hedged) Dharuhera, Chennai Breweries, Empee Breweries, UB Nizam, UB Ajanta and Srikakulam breweries. DBS Bank Ltd: Rs.25,578 (2011: Rs. Nil) secured by pari- Repayable from February 27, 2016 i.e. end of 4th year in passu charge on other than current assets of present 9 equal quarterly instalments till February 27, 2018 along and future except Taloja and Aranvoyal breweries. with interest of 9.58% per annum (fully hedged) Rabobank International: Rs.10,232 (2011: Rs. Nil) secured 3 year ECB Loan repayable on January 10, 2015. Interest by pari-passu charge on other than current assets of present of 7.15% per annum payable on quarterly basis (fully and future except Taloja and Aranvoyal Breweries. hedged) BNP Paribas: Rs.Nil (2011: Rs.4,656) secured by first Repayable in December 2011 on completion of 5 years charge on all moveable and immovable properties of from the date of loan (December 2006) along with interest the Company except Taloja, Aurangabad, Dharuhera, of 8.85% per annum (fully hedged) Chennai Breweries, Empee Breweries, UB Nizam, UB Ajanta and Srikakulam breweries. Axis Bank Ltd: Rs.Nil (2011: Rs.1,256) secured by first Repayable in 16 quarterly instalments from the date of charge on fixed assets and current assets of Srikakulam loan (December 2007) along with interest of 6-months brewery. Libor + 275 basis points (not hedged) Terms of repayment
44

(All amounts in Rs.lacs, unless otherwise stated) Nature of security Indian currency term loans Citibank Ltd: Rs. Nil (2011: Rs.3,288) secured by first Repayable in 73 monthly instalments after completion of charge on all moveable and immoveable properties of one year moratorium period from the date of loan (April the company except Taloja, Aurangabad, Dharuhera, 2006) along with interest of 8.5% per annum Chennai Breweries, Empee Breweries, UB Nizam, UB Ajanta and Srikakulam Breweries. Standard Chartered Bank: Rs.1,700 (2011: Rs.4,250) Repayable in 56 monthly instalments from the date of loan secured by first mortgage and charge on all immoveable (February 2008) along with interest of 12% per annum and movable properties (excluding current assets) of Chennai Breweries. Yes Bank: Rs. Nil (2011: Rs.560) secured by second Repayable in 60 monthly instalments from the date of loan charge on all moveable and immoveable assets of (March 2007) along with interest of 13% per annum Empee Breweries. BNP Paribas: Rs. Nil (2011: Rs.562) secured by first Repayable in 48 monthly instalments after completion charge on all moveable and immoveable assets of of one year moratorium period from the date of loan Empee Breweries (September 2006) along with interest of 9.71% per annum Rabo India Finance Ltd.: Rs. Nil (2011: Rs.1,056) secured Repayable in 59 equal monthly instalments from January by exclusive charge on all moveable and immovable 2007 along with interest of 1 year Government of India properties and second charge on all current assets Security yield + 225 basis points per annum. Interest rate reset on annual basis. Unsecured borrowings Deferred sales tax liability of Millennium Beer Industries This amount is repayable in 10 years from May 2013. Ltd.Aurangabad unit amounting to Rs.4,470 (2011: Rs.4,470) is payable to the Government of Maharashtra by virtue of being eligible after having established a manufacturing unit in a notified backward area. The confirmation of the sanction to the Company is contained in Certificate of Entitlement No. 431133S/R-31B/Pioneer Unit /1322 dated 17.07.2002 issued under Part-I of the 1993 Package Scheme of Government of Maharashtra. ICICI Bank Ltd.: Rs.Nil (2011: Rs.17,500) covered by Loan availed in October 2008, repayable in 2 annual personal guarantee of a director of the company installments starting from end of 4th & 5th year from date of first drawdown. This has been repaid during the current year. Applicable interest rate is 15.7% Citibank: Rs.1,533 (2011: Rs.3,066) shown as current Loan availed in February 2010 repayable in 3 annual equal liablities since payable within next 12 months period instalments from February 2011. Applicable interest rate is 12%. Terms of repayment
45

(All amounts in Rs.lacs, unless otherwise stated) As at March 31, 2012 7. DEFERRED TAX LIABILITIES (NET) Deferred tax asset Provision for doubtful advances and debts Gratuity and Compensated absenses Bonus provision Carryforward losses from amalgamated company Gross deferred tax asset Deferred tax liability Depreciation Deferred tax asset utilised from carry forward loss and depreciation of amalgamated company Gross deferred tax liability Net deferred tax liability 252 506 48 809 1,615 888 355 36 8,387 9,666 As at March 31, 2011
5,946 809 6,755 5,140
4,581 7,973 12,554 2,888
Deferred tax asset and liabilities have been set off as they relate to same governing taxation laws Long-term As at March 31, 2012 8. PROVISIONS Provision for employee benefits Gratuity Compensated absenses Other provisions Provision for proposed dividend and tax there on Provision for water charges Provision for local area development tax Provision for custom duty As at March 31, 2011 Short-term As at March 31, 2012 As at March 31, 2011
381 727 1,108 1,108
85 619 704 704
182 270 452 2,432 554 406 167 3,559 4,011 Water charges As at March 31, 2012 406 148 554
154 230 384 2,700 406 284 167 3,557 3,941
Local area development tax As at March 31, 2012 Balance as at the beginning of the year Additions Amounts used Unused amounts reversed Balance as at the end of the year 284 122 406 As at March 31, 2011 170 114 284
As at March 31, 2011 316 90 406
Provisions for local area development tax, water charges and custom duty matter are sub judice. There are no additions, amounts used or unused amounts reversed during the year with respect to customs duty.
46

(All amounts in Rs.lacs, unless otherwise stated) As at March 31, 2012 9. SHORT-TERM BORROWINGS Secured borrowings Working capital loan / cash credit from banks (repayable on demand) 38,520 38,520 Unsecured borrowings Short-term loans from banks From others 5,000 30 5,030 Total 43,550 26,486 26,486 7,500 30 7,530 34,016 As at March 31, 2011
Working capital loan from banks are secured by hypothecation of stock-in-trade, stores, raw materials, book debts. Short-term loans from banks comprise of ING Vysya Bank: Rs.2,500 (2011: Rs.5,000) repayable in maximum of 365 days and Yes Bank: Rs.2,500 (2011: Rs.2,500) repayable in maximum of 90 days. 10. TRADE PAYABLES Acceptances Sundry Creditors (Refer Note 23) Others: Creditors - Capex 11. OTHER CURRENT LIABILITIES Current maturities of long-term borrowings: Secured (Refer Note 6) Interest accrued but not due on borrowings Current maturities of long-term debt: Unsecured (Refer Note 6) Security deposits Unpaid dividends* Other payables - Statutory dues - Advances received from customers - Overtime and bonus payable - Other expenses payable Total 11,173 861 341 22,687 35,062 41,229 7,701 811 300 15,772 24,584 42,842 2,325 626 2,951 1,533 1,639 44 3,216 14,784 490 15,274 1,533 1,429 22 2,984 22,872 31,971 2,583 57,426 9,024 29,066 966 39,056
* There are no amounts due for payment to the Investor Education and Protection Fund under Section 205C of the Companies Act, 1956 as at the year end.
47
48
(All amounts in Rs.lacs, unless otherwise stated)
Gross Block As at Addition Deletions/ March 31, on Amalga- Additions adjustments 2012 mation As at April 1, 2011 Addition On on AmalgaDeletions mation For the year 700 30 639 4,360 615 11,518 31 6,543 2,016 16 2,032 6,512 3,721 585 10,818 13,550 631 6,376 6,543 Depreciation / Amortisation Net Block As at As at As at March 31, March 31, March 31, 2012 2012 2011 31 2,655 46 2,732 6,543 6,376 631 141 876 3,916 80 64 90 5 5,172 5,172 25,243 350 206,015 25,243 350 192,465 177 76 834 392 (90) 1,704 355 331 56,191 67,009 815 (2) 5,512 3,250 102 (75) 1,670 808 20,428 492 129,171 46,389 2,079 53 54 26 4 2,543 2,543 64 64 2,147 (51) 33,796 4,724 301 2 3,624 270 26 214 11 1 46 272 272 1,180 16,090 116 1,329 11,604 155 715 175 72 14,166 14,866 412 6,354 64 59,858 1,005 4,018 556 361 76,628 84,146 16,090 3,212 27,442 69,313 665 1,494 1,148 473 119,837 121,869 20,735 142,604 60,420 6,264 399 175,950 31,588 22,646 276 13,051 67,009 14,910 3,211 25,998 58,930 605 1,381 777 397 106,209 108,941 7,195 116,136 3,481 64 1,413 4,631 1,132 728
12. FIXED ASSETS
As at April 1, 2011
Intangible
Goodwill
Licences & Rights
Brands
Total - Intangible
13,550
Tangible
Land - Freehold (Note a, b & c)
14,910
Land - Leasehold
Buildings
30,722
Leasehold Improvements
Plant and Machinery
105,319
Office Equipment
Furniture & Fittings
Lab Equipments
Vehicles
Total - Tangible
162,400
Total
175,950
Capital work-in-progress
As at March 31, 2011
109,665
Notes: a. The Company has obtained a stay against resumption proceedings initiated by MIDC over the Land aggregating 6 Acres valued at Rs. 329 (2011: Rs.329) allotted by MIDC to MBIL (since amalgamated with the Company. The matter is yet to be finally heard. b. The Company has filed a Writ petition in the High Court of Kerala at Cochin seeking fixation of rate for issue of Final Patta with respect land measuring 8.0937 hectares valued at Rs.1 (2011: Rs.1). The matter is yet to be heard. c. Land measuring 9.04 acres [Cost Rs.72 (2011: Rs.72)] is pending registration in the name of the Company. d. All the above pieces of land are in physical possession of the Company.
13. NON CURRENT INVESTMENTS (All amounts in Rs.lacs, unless otherwise stated)
Class of shares Number of shares/units Cost Cost Number of shares / units Face value in Rs. Face value in Rs. As at March 31, 2012 As at March 31, 2011
Trade Investments (valued at cost unless otherwise stated) Unquoted equity instruments In subsidiary companies - fully paid up shares: Maltex Malsters Limited (Net of provision for dimunition in value of investments of Rs.1959 (2011: Rs. NIL) [Refer Note (A) below] In associates: Equity 22,950 100 2,541 22,950 100
4,500
United East Bengal Football Team Private Limited Equity 4,999 50 1 4,999 50 1 Other Investments (valued at cost unless otherwise stated) Unquoted equity instruments Zorastrian Co-operative Bank Limited Equity 2,000 25 1 2,000 25 1 Skol Breweries Limited Equity 300 10 0 Jupiter Breweries Limited Equity 50 10 0 Mohan Meakins Limited Equity 100 5 0 Blossom Breweries Limited Equity 100 3 0 Cosmos co-operative Bank Limited Equity 5,000 100 1 In government and trustee securities National savings certificate 3 1 [Net of provision for dimunition in value of investments of Rs.15 (2011: Rs.15)] Total 2,547 4,502 a) The investment in Maltex Malsters Limited (MML) which had a carrying value of Rs.4,500, has been revalued at Rs. 2,541. The diminution in value of this investment has been due to continued delays in obtaining necessary approvals to expand its malting facility at Patiala. Considering the constraints in MMLs expansion plans and the high overhead costs incurred on operating at its current level of capacity, it has been decided to value the investment based on the failr value of net assets of MMIL. b) Following investments costing less than Rs.1 Lac have been disclosed below in absolute amount in rupees. 50,000 50,000 1,727 188 925 300 103,140
United East Bengal Football Team Pvt Limited Zorastrian Co-operative Bank Limited Skol Breweries Limited Jupiter Breweries Limited Mohan Meakins Limited Blossom Breweries Limited Total
49

(All amounts in Rs.lacs, unless otherwise stated) Long-term As at March 31, 2012 14. LOANS AND ADVANCES Secured, considered good Other loans and advances Star Investments Private Limited (Refer Note 42) Unsecured, considered good Capital advances Security deposits Advances to suppliers Prepaid expenses Other loans and advances MAT credit entitlement Advance tax / TDS receivable (net of provision) Others Unsecured, considered doubtful Capital advances Security deposits Advances to suppliers Other loans and advances Allowance for bad and doubtful loans and advances Total As at March 31, 2011 Short-term As at March 31, 2012 As at March 31, 2011
8,624 4,408 123 1,221 14,376 51 6 (57) 14,376
7,385 4,469 101 30 11,985 42 740 (782) 11,985
15,500 15,500 627 3,522 2,848 3,624 3,056 88 13,765 41 (41) 29,265 As at March 31, 2012
15,500 15,500 659 3,244 2,312 4,762 1,392 1,253 13,622 52 151 (203) 29,122 As at March 31, 2011
15. OTHER NON CURRENT ASSETS Unsecured, Considered good Bank deposits with original maturity of greater than 12 months Others Sales tax recoverable Storage / privilage fee recoverable Total 16. INVENTORIES [net of obsolete provisions] Raw materials [Includes in transit: Rs.1,191 (2011: Rs.668)] Packing materials and bottles [Includes in transit: Rs.60 (2011: Rs.81)] Work-in-progress Finished goods* [Includes in transit: Rs.689 (2011: Rs.405)] Stock-in-trade Stores and spares [Includes in transit: Rs.12 (2011: Rs.4)] Total * Net of Obsolete provision of Rs.22 (2011: Rs.3)
26 1,127 13 1,166 11,070 6,551 12,732 5,331 1 4,303 39,988
1,073 13 1,086 8,603 4,659 8,680 3,395 46 3,597 28,980
50

(All amounts in Rs.lacs, unless otherwise stated) As at March 31, 2012 17. TRADE RECEIVABLES Unsecured, Considered good Outstanding for a period exceeding six months from the date they are due for payment Others Unsecured, Considered doubtful Outstanding for a period exceeding six months from the date they are due for payment Others Less: Provision for bad and doubtful debts Total 18. CASH AND BANK BALANCES Cash and cash equivalents Cash on hand Cheques, drafts on hand Bank balances In current account (Refer Note i) Demand deposits with maturity of less than 3 months Other balances with Banks In Deposits Less than 12 months but more than 3 months Greater than 12 months Margin money / security Total i. Includes balance in Unpaid Dividend Account Rs.39 (2011: Rs.22) 19. OTHER CURRENT ASSETS Unsecured, Considered good Income accrued on deposits and others Excise duty deposits Total 20. CAPITAL COMMITMENTS Estimated amount of contract remaining to be executed (net of capital advances) on capital account and not provided for 15,792 15,792 7,377 7,377 6,442 5,150 11,592 6,676 2,747 9,423 105 88 465 658 17,723 53 1,706 1,759 12,906 34 1 2,030 15,000 17,065 29 5 9,413 1,700 11,147 668 12 (680) 69,997 1,706 39 (1,745) 51,986 3,114 66,883 1,130 50,856 As at March 31, 2011
51

(All amounts in Rs.lacs, unless otherwise stated) As at March 31, 2012 21. CONTINGENT LIABILITIES a) Sales Tax / other taxes demands under appeal # b) Employees state insurance / Provident Fund demand # c) Demand towards water charges under appeal# d) Excise Duty / Customs Duty demands under appeal# e) Income Tax demands under appeal# f) Service Tax demands under appeal# g) Claims against the company not acknowledged as debt# h) Letter of undertaking to distributors towards countervailing duty for imports from Nepal# 1,349 19 2,694 392 10,238 7,513 1,002 23,207 As at March 31, 2011 1,304 23 1,825 413 4,038 2,446 413 385 10,847
# It is not practicable for the company to estimate the timing of cashflows if any, in respect of the above, pending resolution of the respective proceedings. The company does not expect any reimbursements in respect of the above contingent liabilities. As at March 31, 2012 22. PROPOSED DIVIDENDS Dividend payable on Preference share capital @ Rs.3 per share (2011: Rs.3 per share) Dividend distribution tax payable on above Proposed dividend on equity shares @ Re.0.70 per share (2011: Re.0.60 per share) Dividend distribution tax payable on above Total There are no arrears of dividend related to preference shares As at March 31, 2012 23. Disclosure of dues / payments to micro and small enterprises to the extent such enterprises are identified by the company. a) The principal amount remaining unpaid as at year end b) Interest due thereon remaining unpaid on year end c) The amount of interest paid by the buyer in terms of section 16 of the Micro, Small and Medium Enterprises Development Act, 2006, along with the amount of the payment made to the supplier beyond the appointed day during each accounting year d) Delayed payment of principal beyond the appointed date during the year e) Interest actually paid under section 16 of MSME Act, 2006 f) The amount of interest accrued and remaining unpaid on year end in respect of principal amount settled during the year g) The amount of further interest remaining due and payable even in the succeeding years, until such date when the interest dues as above are actually paid to the small enterprise, for the purpose of disallowance as a deductible expenditure under section 23 of the Micro, Small and Medium Enterprises Development Act, 2006 272 2 41 161 1 10 As at March 31, 2011 242 39 1,851 300 2,432 741 120 1,582 257 2,700 As at March 31, 2011
43
43
The information given above has been determined to the extent such parties have been identified by the Company, on the basis of information disclosed by the creditors, which has been relied upon by the auditors.
52

(All amounts in Rs.lacs, unless otherwise stated) Year ended March 31, 2012 24. REVENUE FROM OPERATIONS Sale of products Sale of services Other operating revenues Revenue from operations (gross) Less: Excise duty Revenue from operations (net) 25. OTHER INCOME Interest income Dividend income [Include dividend received from subsidiary company of Rs.2 (2011: Nil)] Net gain / (loss) on sale of assets / investments Liabilities no longer required written back Provision for doubtful debts, no longer required written back Provision for doubtful advances, no longer required written back Other non-operating income Total 26. COST OF MATERIALS CONSUMED Raw materials Opening stock Stocks received from amalgamated entity Purchases Closing stock Consumption Packing materials Opening stock Stocks received from amalgamated entity Purchases Closing stock Consumption Other manufacturing expenses Total 27. PURCHASES OF STOCK-IN-TRADE Finished goods Total 4,230 4,230 6,007 6,007 4,659 1,694 105,440 6,550 105,243 549 160,376 2,755 1,112 93,211 4,659 92,419 314 133,258 8,603 105 56,946 11,070 54,584 5,725 570 42,833 8,603 40,525 3,300 19 1 585 1,290 998 1,105 7,298 3,166 42 2 513 9 767 4,499 568,357 357 17,780 586,494 223,725 362,769 443,024 561 16,865 460,450 154,469 305,981 March 31, 2011
53

(All amounts in Rs.lacs, unless otherwise stated) Year ended March 31, 2012 March 31, 2011 28. CHANGES IN INVENTORIES OF FINISHED GOODS, WORK-IN-PROGRESS AND STOCK-IN-TRADE Stock at the end of the year: Finished goods Finished goods - Traded Work-in-progress Less: Stock at the beginning of the year: Finished goods Finished goods - Traded Work-in-progress Stock of amalgamated entities - Finished goods Stock of amalgamated entities - Work-in-progress (Increase) / decrease in stocks Excise duty movement on closing stock Total 29. EMPLOYEE BENEFITS EXPENSE Salaries, wages and bonus Gratuity Contribution to provident and other funds Welfare expenses Total
5,353 1 12,732 18,086 2,954 46 8,416 42 409 11,867 (6,219) 4,394 (1,825) 16,248 343 829 1,403 18,823
2,954 46 8,416 11,416 2,134 198 6,233 525 2,197 11,287 (129) 466 337 12,404 305 623 1,079 14,411
i) Disclosures envisaged in AS 15 in respect of defined benefit plans (Gratuity and Provident Fund administered by a trust setup by the Company) are given below: Particulars A) Reconciliation of opening and closing balances of the present value of the defined benefit obligation: Obligations at period beginning Obligation at period beginning from Amalgamation Service cost Interest cost Benefits settled Actuarial (gain) / loss Obligations at period end B) Change in plan assets Plan assets at period beginning, at fair value Plan assets at period beginning from Amalgamation Expected return on plan assets Actuarial gain / (loss) Contributions Benefits settled Plan assets at period end, at fair value 2012 Gratuity Provident fund 2011 2010 2009 2008 Gratuity
1,878 37 326 156 (158) (20) 2,219 1,639 37 128 (10) 20 (158) 1,656
3,434 680 284 (172) (4) 4,222 3,490 308 50 658 (172) 4,334
1,614 97 226 126 (234) 49 1,878 1,542 54 125 (13) 159 (228) 1,639
1,539 85 118 (125) (3) 1,614 1,331 102 (17) 251 (125) 1,542
1,426 130 96 (109) (4) 1,539 1,365 107 (76) 44 (109) 1,331
1,161 435 93 (260) (3) 1,426 1,161 93 108 263 (260) 1,365
54

(All amounts in Rs.lacs, unless otherwise stated) Particulars C) Reconciliation of present value of the obligation and the fair value of the plan assets Fair value of plan assets at the end of the year Present value of the defined benefit obligations at the end of the period Liability recognised in the balance sheet D) Expenses recognised in Statement of Profit and Loss Service cost Interest cost Expected return on plan assets Prior Period adjustment Actuarial (gain) / loss Total expenses recognised in Statement of Profit and Loss Major category of Plan Assets as a % of total Plan assets Government Securities Corporate Bonds Fund balance with insurance companies F) Description of the basis used to determine the overall expected rate of return on assets including major categories of plan assets The expected return is calculated on the average fund balance based on the mix of investments and the expected yield on them. Actual return on plan assets G) Assumptions Interest rate Discount factor Estimated rate of return on plan assets Salary increase Attrition rate Retirement age 8.5% 8.5% 8.0% 5.0% 1.0% 58 8.5% 8.5% 8.25% 5.0% 1.0% 58 8.0% 8.0% 8.0% 5.0% 1.0% 58 8.0% 8.0% 8.0% 5.0% 1.0% 58 7.0% 7.0% 8.0% 5.0% 1.0% 58 8.0% 8.0% 8.0% 5.0% 1.0% 58 115 112 85 31 201 326 156 (128) (11) 343 680 285 (308) (54) 603 249 126 (125) 55 305 84 118 (102) 14 114 131 96 (107) 62 182 435 93 (93) (237) 62 260 1,656 2,219 (563) 4,334 4,222 112 1,639 1,878 (239) 1,542 1,614 (72) 1,331 1,539 (208) 1,365 1,426 (61) 2012 Gratuity Provident fund 2011 2010 2009 2008
Gratuity
E)
100%
41% 59%
100%
100%
100%
100%
The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand factors in the Employment market. As per the best estimate of management, Provident Fund contribution of Rs.875 (2011: Rs.850) and Gratuity contribution of Rs.400 (2011: Rs.350) is expected to be paid to the plans during the year ending March 31, 2013. (ii) Contribution to Provident and Other Funds (Note 29) includes Rs.1,172 (2011: Rs.928) being expenses debited under the following defined contribution plans Provident Fund Superannuation fund and National Pension scheme Total 600 229 829 458 165 623 360 131 491 282 109 391 288 94 382
55

(All amounts in Rs.lacs, unless otherwise stated) Year ended March 31, 2012 30. OTHER EXPENSES Power and fuel Rent Repairs to buildings Repairs to machinery* Repairs to others Insurance Rates and taxes Auditor remuneration As auditor For other services Sales promotion expenses Outward freight / halting / breakage expenses Selling & Distribution expenses Provision for doubtful debts Provision for doubtful advances Miscellaneous expenses Total 14,151 1,136 386 7,494 319 353 3,637 78 42 71 36 March 31, 2011 10,196 1,014 290 5,070 214 237 2,779
120 60,450 19,535 20,046 49 64 12,221 139,960
107 53,860 15,400 16,488 317 17 6,992 112,981
*Repairs to machinery includes stores and spares consumed Rs.3,488 (2011: Rs.2,420) 31. FINANCE COSTS Interest expense Other borrowing costs Net gain / (loss) on foreign currency transactions and translation differences Total 32. CIF VALUE OF IMPORTS Raw materials Components and spares Capital goods Total 33. EXPENDITURE IN FOREIGN CURRENCY Foreign travel expenses of employees and others (net of recoveries) Technical services fees Selling and promotion expenses Interest and finance charges Others Total
9,392 480 40 9,912
7,336 264 213 7,813
3,879 127 4,593 8,599
2,727 53 533 3,313
103 654 1,897 701 86 3,441
102 600 1,180 588 26 2,496
56

(All amounts in Rs.lacs, unless otherwise stated) Year ended March 31, 2012 34. DETAILS OF CONSUMPTION AND PURCHASES a) Purchase of traded goods (Beer) Opening stock Purchases during the year Sales during the year Closing stock b) Consumption of materials Malt Brewing materials Bottles Packing materials Other materials Total c) Value of imported and indigenous materials Value of imported raw materials consumed Value of indigenous raw materials consumed Value of imported packing materials and stores and spares consumed Value of indigenous packing materials and stores and spares consumed % 5% 95% 1% 99% March 31, 2011
46 4,230 4,275 1
199 6,008 6,161 46
31,130 16,468 71,700 33,543 7,536 160,377 Value in Rs. 2,663 51,921 1,350 107,930 % 6% 94% 2% 98%
21,379 15,117 63,886 28,533 4,344 133,259 Value in Rs. 2,270 38,255 1,705 93,448
Year ended March 31, 2012 March 31, 2011 35. DIVIDEND REMITTED IN FOREIGN EXCHANGE Dividend paid during the year Number of non resident shareholders Number of equity shares held by such non resident shareholders Number of preference shares held by such non resident shareholders Year to which dividend relates to 36. EARNINGS IN FOREIGN CURRENCY Services - Royalty 37. EARNINGS PER SHARE Profit after exceptional items and taxation as per statement of profit and loss Less: Preference dividend (including dividend distribution tax thereon) Net profit attributable to equity shareholders Weighted average number of equity shares outstanding (Face value of Re.1 per share) Earnings per share (Basic / Diluted) *Includes 91,50,633 equity shares of Re.1 each pending allotment 12,644 281 12,363 264,405,149 4.68 14,729 861 13,868 263,695,571 * 5.26 149 199 667 5 111,801,394 7,407,000 (2010-11) 399 3 110,945,914 24,690,000 (2009 -10)
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(All amounts in Rs.lacs, unless otherwise stated) 38. AMALGAMATIONS I. 2011-12 A. The scheme of amalgamation under sections 391 to 394 of the Companies Act, 1956 between UB Ajanta Breweries Private Limited (UBA) and the Company (the Scheme) and their respective shareholders and creditors with April 1, 2011 as the appointed date has been approved by the Honorable BIFR court, Delhi vide their order dated February 13, 2012. Upon necessary filing with the Registrar of Companies on February 21, 2012, the scheme has become effective and the effect thereof has been given in these accounts. Consequently, In respect of the merger of UBA with the Company a) In terms of the scheme, the entire business and the whole of the undertaking of UBA, as a going concern stands transferred to and vested in the Company with effect from April 1, 2011, being the Merger Appointed Date. b) In consideration of the amalgamation of UBA with the company, the company has issued 709,578 equity shares of Re.1/- each aggregating to Rs.7 in the ratio of 135:1. c) Accounting for Amalgamation: The amalgamation of UBA with the Company is accounted for on the basis of the pooling of interest Method as envisaged in the Accounting Standard (AS)-14 on Accounting for Amalgamations specified in the Companies (Accounting Standard) Rules 2006 and in terms of the scheme, as below, All asset and liabilities of the UBA at their respective Book Values under the respective heads of the company. Rs.28 being the difference between the value of net assets of the UBA transferred to the Company (determined as stated above) and the carrying value of the Companys investment (cancelled as above) has been adjusted to Capital/General Reserve of the Company. The intercompany balances and the transactions stood cancelled. UBA was engaged in brewing business. [The Authorised Share capital of the Company stands increased by Rs.540 of Equity Share Capital of Re.1/- each and enhanced by Rs.9,460 of Rs.100/- each in Preference Share Capital. This increase is arising on account of amalgamation of UBA with United Breweries Limited.] B. UBL Benefit Trust Arising out of the Amalgamation of EBL into UBL [Refer II A(iii) below], UBL Benefit Trust held 6,007,413 equity shares in UBL constituting 2.36% of UBLs paid up equity capital. The Trust has sold its entire shareholding and remitted the entire proceeds aggregating Rs.28,357 to UBL. The entire proceeds has been used in reducing the Debt of the Company. In the absence of any specific accounting treatment being prescribed in the Accounting Standards notified pursuant to the Companies (Accounting Standards) Rules, 2006 as per section 211(3C), the gain on sale of these shares held by UBL Benefit Trust (of which the Company is the sole beneficiary) aggregating to Rs.14,049 has been credited to the General Reserve. II. 2010-11 A. The scheme of amalgamation under sections 391 to 394 of the Companies Act, 1956 between Associated Breweries and Distilleries Limited (ABDL), Millennium Alcobev Private Limited (MAPL), Empee Breweries Limited (EBL) and the Company (the Scheme) and their respective shareholders and creditors with April 1, 2010 as the appointed date has been approved by the Honorable High Courts of Karnataka and Madras respectively vide their orders dated January 21, 2011 and February 1, 2011 respectively. Upon necessary filing with the Registrar of Companies on March 10, 2011, the scheme has become effective and the effect thereof has been given in these accounts. Consequently, (i) In respect of the merger of ABDL with the Company a) In terms of the Scheme, the entire business and the whole of the undertaking of ABDL, as a going concern stands transferred to and vested in the Company with effect from April 1, 2010, being the Merger Appointed Date.
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(All amounts in Rs.lacs, unless otherwise stated) b) As ABDL was a wholly owned subsidiary of the Company, no consideration was payable pursuant to amalgamation of ABDL. c) Accounting for Amalgamation: The amalgamation of ABDL with the Company is accounted for on the basis of the Purchase Method as envisaged in the Accounting Standard (AS)-14 on Accounting for Amalgamations specified in the Companies (Accounting Standard) Rules, 2006 and in terms of the scheme, as below, All asset and liabilities of the ABDL at their respective Fair Values. Rs. 44,986 being the difference between the value of net assets of the ABDL transferred to the Company (determined as stated above) and the carrying value of the Companys investment in MAPL (cancelled as above) has been adjusted to Capital/General Reserve of the Company. This accounting treatment of the reserve has been prescribed in the Scheme and approved by the High Court(s). Had the scheme not prescribed this treatment, this amount would have been debited to Goodwill, which would have been set-off against the Capital Reserve/General Reserve arising on the merger of other companies. ABDL was an investment company which was 100% subsidiary of the Company. (ii) In respect of the merger of MAPL with the Company a) In terms of the Scheme the entire business and the whole of the undertaking of MAPL, as a going concern stands transferred to and vested in the Company with effect from April 1, 2010 being the Merger Appointed Date. b) In consideration of the amalgamation of MAPL with the Company, the Company has issued 8,489,270 equity shares of Re.1/- each aggregating to Rs.85 in the ratio of 6 fully paid up Equity shares of the face value of Re.1/- each of the Company for every 31 fully paid up equity shares of Rs.10/- each held in MAPL. The Companys investment in MAPL aggregating to Rs.5,895 comprising of 61,40,000 equity shares (with voting rights) and 65,99,312 equity shares (without voting rights) of Rs.10/- each stood cancelled. c) Accounting for Amalgamation: The amalgamation of MAPL with the Company is accounted for on the basis of the Purchase Method as envisaged in the Accounting Standard (AS)-14 on Accounting for Amalgamations specified in the Companies (Accounting Standard) Rules, 2006 and in terms of the scheme, as below. All asset and liabilities of the MAPL were recorded at their respective Fair Values. Rs.40,373 being the difference between the value of net assets of the MAPL transferred to the Company (determined as stated above) and the carrying value of the Companys investment in MAPL (cancelled as above) has been adjusted to Capital/General Reserve of the Company. This accounting treatment of the reserve has been prescribed in the Scheme and approved by the High Court(s). Had the scheme not prescribed this treatment, this amount would have been credited to Capital Reserve. MAPL was a Joint Venture between the Company and Scottish & Newcastle India Private Limited, which had 3 subsidiaries engaged in the brewing business. One subsidiary of MAPL, i.e. Empee Breweries Ltd., was also merged into UBL simultaneously along with MAPL. Subsequent to the merger of MAPL into UBL, the other 2 subsidiaries of MAPL, namely Millennium Beer Industries Limited (MBIL) and United Millennium Breweries Limited (UMBL) became the subsidiaries of the Company and all of them have been since amalgamated with the Company. (iii) In respect of the merger of Empee Breweries Limited with the Company a) In terms of the Scheme, the entire business and the whole of the undertaking of EBL, as a going concern stands transferred to and vested in the Company with effect from April 1, 2010, being the Merger Appointed Date. b) On the amalgamation of EBL with the Company, 50% of the holding stood cancelled and for the balance 50% of the holding, the Company issued 6,007,413 equity shares of Re.1/- each aggregating to Rs.60 in the ratio of 33 fully paid up Equity shares of the face value of Re.1/- each of the Company for every 16 fully paid up equity shares of Rs.10/- of EBL to UBL Benefit Trust. UBL Benefit Trust has subsequent to the Balance Sheet date sold these shares and remitted the proceeds to the Company.
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(All amounts in Rs.lacs, unless otherwise stated) c) Accounting for Amalgamation: The amalgamation of EBL with the Company is accounted for on the basis of the Pooling of Interest Method as envisaged in the Accounting Standard (AS) -14 on Accounting for Amalgamations specified in the Companies (Accounting Standard) Rules, 2006 and in terms of the scheme, as below, All asset and liabilities of the EBL were recorded at their respective book values under the respective accounting heads of the Company. Rs.13,645 being the difference between the value of net assets of the EBL transferred to the Company (determined as stated above) and the carrying value of the Companys investment has been adjusted to Capital/General Reserve of the Company. The Shares issued to UBL Benefit Trust appears as a separate line item in the Balance Sheet of the Company as Interest in UBL Benefit Trust. The inter company balances and transactions stood cancelled. EBL was engaged in the brewing business. B. The scheme of amalgamation under sections 391 to 394 of the Companies Act, 1956 between UB Nizam Breweries Private Limited (UBNPL) and the Company (the Scheme) and their respective shareholders and creditors, with April 1, 2010 as the appointed date, has been approved by the Honorable High Court of Karnataka vide its order dated August 26, 2011. Upon necessary filing with the Registrar of Companies, the scheme has become effective on November 8, 2011 and the effect thereof has been given in these accounts. Consequently, in respect of the merger of UB Nizam Breweries Private Limited (UBNPL) with the Company a) In terms of the Scheme, the entire business and the whole of the undertaking of UBNPL, as a going concern stands transferred to and vested in the Company with effect from April 1, 2010, being the Merger Appointed Date. b) In consideration of the amalgamation of UBNPL with the Company, the Company had issued 145,902 equity shares of Re.1/- each aggregating to Re.1 in the ratio of 1 fully paid up equity shares of the face value of Re.1/- each of the Company for every 454 fully paid up equity shares of Rs.10/- each held in UBNPL and in the ratio of 1 fully paid up Equity Shares of the face value of Re.1/- each of the Company for every 454 fully paid preference shares of Rs.10/- each in UBNPL. c) Accounting for Amalgamation: The amalgamation of UBNPL with the Company is accounted for on the basis of the Pooling of Interest Method as envisaged in the Accounting Standard (AS) -14 on Accounting for Amalgamations specified in the Companies (Accounting Standard) Rules, 2006 and in terms of the scheme, as below, All asset and liabilities of UBNPL were recorded at their respective book values under the respective accounting heads of the Company. Rs.488 being the difference between the value of net assets of UBNPL transferred to the Company (determined as stated above) and the carrying value of the Companys investment has been adjusted to Capital/General Reserve of the Company. The inter company balances and the transactions stood cancelled. UBNPL was engaged in the brewing business. C. The scheme of amalgamation under sections 391 to 394 of the Companies Act, 1956 between Chennai Breweries Private Limited (CBPL) and the Company (the Scheme) and their respective shareholders and creditors with March 31, 2011 as the appointed date has been approved by the Honorable High Court of Karnataka and Honorable High Court of Madras, vide its order dated August 26, 2011 and October 11, 2011 respectively. Upon necessary filing with the Registrar of Companies, the scheme has become effective on November 12, 2011 and the effect thereof has been given in these accounts. Consequently, in respect of the merger of Chennai Breweries Private Limited (CBPL) with the Company a) In terms of the Scheme, the entire business and the whole of the undertaking of CBPL, as a going concern stands transferred to and vested in the Company with effect from the closing hours of March 31, 2011, being the Merger Appointed Date.
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(All amounts in Rs.lacs, unless otherwise stated) b) In consideration of the amalgamation of CBPL with the Company, the Company has issued 8,500,000 equity shares of Re.1/- each aggregating to Rs.85 in the ratio of 17 fully paid up Equity shares of the face value of Re.1/- each of the Company for every 30 fully paid up equity shares of Rs.10/- each held in CBPL which is pending allotment. c) Accounting for Amalgamation: The amalgamation of CBPL with the Company is accounted for on the basis of the Pooling of Interest Method as envisaged in the Accounting Standard (AS) -14 on Accounting for Amalgamations specified in the Companies (Accounting Standard) Rules, 2006 and in terms of the scheme, as below, All asset and liabilities of CBPL were recorded at their respective book values under the respective accounting heads of the Company. Rs.1,645 being the difference between the value of net assets of CBPL transferred to the Company (determined as stated above) and the carrying value of the Companys investment has been adjusted to Capital/General Reserve of the Company. The inter company balances stood cancelled. CBPL was engaged in the brewing business. D. The scheme of amalgamation between Millennium Beer Industries Limited (MBIL) and the Company (the Scheme) and their respective shareholders and creditors with April 1, 2010 as the appointed date has been approved by the Honorable BIFR Court, Delhi vide its order dated November 11, 2011. Upon necessary filing with the Registrar of Companies, the scheme has become effective on November 16, 2011 and the effect thereof has been given in these accounts. Consequently, in respect of the merger of Millennium Beer Industries Limited (MBIL) with the Company. a) In terms of the Scheme, approved by the BIFR Court, the entire business and the whole of the undertaking of MBIL, as a going concern stands transferred to and vested in the Company with effect from April 1, 2010, being the Merger Appointed Date. b) On the amalgamation of MBIL with the Company, the Companys holding stands cancelled and for the rest the Company has issued 504,731 equity shares of Re.1/- each aggregating to Rs.5 in the ratio of 1 fully paid up Equity shares of the face value of Re.1/- each of the Company for every 12 fully paid up equity shares of Re.1/- of MBIL allotment. c) Accounting for Amalgamation: The amalgamation of MBIL with the Company is accounted for on the basis of the Pooling of Interest Method as envisaged in the Accounting Standard (AS) -14 on Accounting for Amalgamations specified in the Companies (Accounting Standard) Rules, 2006 and in terms of the scheme, as below, All asset and liabilities of MBIL were recorded at their respective book values under the respective accounting heads of the Company. Rs.30,514 being the difference between the value of net assets of MBIL transferred to the Company (determined as stated above) and the carrying value of the Companys investment has been adjusted to Capital/General Reserve of the Company. The inter company balances and transactions stood cancelled. MBIL was engaged in the brewing business. E. The scheme of amalgamation between United Millennium Breweries Limited (UMBL) and the Company (the Scheme) and their respective shareholder and creditors with April 1, 2010 as the appointed date has been approved by the Honorable BIFR Court, Delhi vide its order dated November 21, 2011. Upon necessary filing with the Registrar of Companies, the scheme has become effective on November 21, 2011 and the effect there of have been given in these accounts. Consequently, in respect of the merger of United Millennium Breweries Limited (UMBL) with the Company a) In terms of the Scheme approved by the BIFR Court, the entire business and the whole of the undertaking of UMBL, as a going concern stands transferred to and vested in the Company with effect from April 1, 2010 being the Merger Appointed Date.
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(All amounts in Rs.lacs, unless otherwise stated) b) As UMBL was a wholly owned subsidiary of the Company, no consideration was payable pursuant to amalgamation of UMBL with the Company. c) Accounting for Amalgamation: The amalgamation of UMBL with the Company is accounted for on the basis of the Pooling of Interest Method as envisaged in the Accounting Standard (AS) -14 on Accounting for Amalgamations specified in the Companies (Accounting Standard) Rules, 2006 and in terms of the scheme, as below, All asset and liabilities of UMBL were recorded at their respective book values under the respective accounting heads of the Company. Rs.4,668 being the difference between the value of net assets of UMBL transferred to the Company (determined as stated above) and the carrying value of the Companys investment has been adjusted to Capital/General Reserve of the Company. The inter company balances and transactions stood cancelled. UMBL was engaged in the brewing business. Pursuant to all the schemes referred to in A to E above, the bank accounts, agreements, licences and certain immovable properties of the transferor companies are in the process of being transferred in the name of the Company. Pursuant to the schemes referred to in II A to E above, the Authorized Share Capital of the Company stands increased and reclassified, without any further act or deed on the part of the company, including payment of stamp duty and Registrar of Companies fees, by Rs.57,340 comprising of 3,320,000,000 Equity Shares of Re.1 each and 24,140,000 Preference Shares of Rs.100 each, being the authorized share capital of the transferor company, and Memorandum of Association and Articles of Association of the Company stand amended accordingly without any further act or deed on the part of the company. The Summary of additions/(deletions) to/(from) of Capital Reserve/General Reserve arising out each of the amalgamating entities is given below: Particulars Expenses relating to mergers Arising on amalgamating ABDL Arising on amalgamating MAPL Arising on amalgamating EBL Arising on amalgamating UBN Arising on amalgamating CBPL Arising on amalgamating MBIL Arising on amalgamating UMBL DTA arising on amalgamation Total Resultant capital reserve on amalgamation General Reserve 127 (6,134) 230 (21,397) (2,778) 8,387 (21,565) Capital Reserve (358) (450) 40,373 (13,772) 6,623 1,415 (9,118) (1,890) 22,823 1,258
The shares outstanding to be issued in respect of amalgamation of UBNPL, CBPL and MBIL were disclosed as share capital pending allotment in the financial statements for the year ended March 31, 2011 pending completion of allotment formalities. These shares have been alloted during the year ended March 31, 2012. iii. Subsequent to the amalgamation of UBNPL, EPL, CBPL, UBAPL, UMBL and MBIL with the Company as indicated above, the Company has initiated the process of obtaining its name recorded in the state excise records and with other regulatory authorities in place of UBNPL, EBL, CBPL, UBAPL, UMBL and MBIL. Pending completion of these formalities, the name of UBNPL, EBL, CBPL, UBAPL, UMBL and MBIL are continued to be used in various documents, records, invoices and vouchers etc. iv. On 7th February 2012, the Company has obtained Board approval for amalgamation of Scottish & Newcastle India Private Limited with an appointed date of April 1, 2012. Applications have been filed with Honourable High Court of Karnataka for necessary approvals.
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(All amounts in Rs.lacs, unless otherwise stated) 39. RELATED PARTY DISCLOSURES A. Related parties with whom transactions have taken place during the year Subsidiary: Maltex Malsters Limited (MML) Associate: United East Bengal Football Team Private Limited (UEBFTPL) Entity which has significant influence: a) Scottish & Newcastle India Limited (SNIL) b) United Breweries (Holdings) Limited (UBHL) Others: a) Scottish & Newcastle Limited (S&N) b) Heineken UK Limited, holding company of SNIL and subsidiary of Scottish & Newcastle Limited c) Scottish & Newcastle UK Limited (SNUK), Subsidiary of Scottish & Newcastle Limited d) Scottish & Newcastle India Private Limited (SNIPL), subsidiary of Heineken UK Limited e) Heineken International B.V. f) Heineken Romania S.A. g) Heineken Brouwerijen B.V. h) Heineken Supply Chain B.V. i) Force India F1 Team Limited (Force India) Key Management Personnel (KMP): Mr. Kalyan Ganguly Mr. Guido de Boer Relative of KMP Mrs. Suparna Bakshi Ganguly (Wife of Mr. Kalyan Ganguly) B. Transactions with related parties during the year: MML 2012 2011 29 1,156 23 1,222 (120) 66 18 57 (134) UEBFTPL UBHL FORCE INDIA KMP 2012 2011 2012 2011 2012 2011 2012 2011 1,187 961 911 911 (18) 503 503 (18) 15 61 662 (608) 104 6 1,376 64 662 (255) 263 973 894 581
Sale of goods [including sales taxes / VAT] Sponsorship and other payments Lease rentals/processing charges Royalty on logo Interest paid Payments (for supplies including loan in cash or kind)# Remuneration to Directors* Amount due from/(to)
462 1,171 914
*Kalyan Ganguly: Rs.670 (2011: Rs.415), Guido de Boer: Rs.224 (2011: Rs.166) #Figures in brackets indicate amounts received C. Transactions with Heineken Group (1) Transactions with SNIL Balance of preference share capital Dividend on above Redemption of preference share capital Final dividend on equity shares (2) Transaction with Heineken UK Ltd. Purchase of raw material Reimbursements (3) Transaction with Heineken Romania S.A. Mould development charges Rs.7,407 (2011: Rs.24,690) Rs.242 (2011: Rs.741) Rs.17,283 (2011: Rs.NIL) Rs.630 (2011: Rs.399) Rs.2 (2011: Rs.7) Rs.2 (2011: Rs.1) Rs.NIL (2011: Rs.1)
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(All amounts in Rs.lacs, unless otherwise stated) (4) Transaction with Heineken Brouwerijen B.V. Technical services fee Sales promotion (5) Transaction with Heineken International B.V. Reimbursements Final dividend on equity shares (6) Transaction with Heineken Supply Chain B.V. Consultancy fee Rs.600 (2011: Rs.600) Rs.2 (2011: Rs.NIL) Rs.66 (2011: Rs.56) Rs.3 (2011: Rs.NIL) Rs.54 (2011: Rs.17)
40. OPERATING LEASE The Company has entered into leasing arrangements for vehicles, computers, equipments, office premises and residential premises that are renewable on a periodic basis, and cancellable/ non-cancellable in nature. Such leases are generally for a period of 11 to 60 months with options of renewal against increased rent and premature termination of agreement through notice period of 2 to 3 months, except in the case of certain leases where there is a lock-in period of 11 to 26 months. Particulars Lease payments during the year At the balance sheet date, future minimum lease rentals under non-cancellable operating leases are as under: Not later than one year One to five years Total 41. DETAILS OF SUBSIDIARY/ASSOCIATE Particulars Name of the Subsidiary Maltex Malsters Limited (MML) Name of the Associate United East Bengal Football Team Private Limited (UEBFTPL) 42. ADVANCE MADE TO STAR INVESTMENTS The Company had entered into an agreement with the promoters of Balaji Distilleries Limited (BDL) with a view to secure perpetual usage of its brewery and grant of first right of refusal in case of sale or disposal of its brewery unit in any manner by BDL, towards which the Company had made a refundable facility advance of Rs.15,500 to Star Investments Private Ltd. (Star Investments), one of the Promoter Companies of BDL, acting for itself and on behalf of the other Promoters. Subsequently, BDL filed a scheme of arrangement for amalgamation of its distillery into United Spirits Limited (USL) and de-merger of its brewery into Chennai Breweries Private Limited (CBPL) and the said Scheme was approved by Appellate Authority for Industrial & Financial Reconstruction in November 2010. The Brewery assets proposed to be acquired by the Company from the Promoters of BDL eventually vested in CBPL which was a 100% subsidiary of USL. A Scheme for Amalgamation of CBPL into the Company was then filed. Upon amalgamation of CBPL into the Company, USL has been allotted equity shares in terms of the approved Scheme. On November 22, 2011, the Company has entered into an agreement extending the repayment of principal and interest outstanding till March 2012, and obtained a pledge of securities from associate companies of Star to secure the outstanding amounts. Commitment has been received from Star Investments for accruing of interest on the outstanding till the same is fully repaid. 49.99 49.99 India 51 51 India Ownership % 2012 2011 Country of Incorporation 173 108 281 196 269 465 Year ended March 31, 2012 1,136 March 31, 2011 1,014
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(All amounts in Rs.lacs, unless otherwise stated) The company has received payments of Rs.2,980 towards interest after the repayment date and the aggregate amount due as on March 31, 2012 is Rs.21,196. The Company continued to receive interest and TDS payments to the tune of Rs.11,190 after March 31, 2012 till date. 43. DERIVATIVE INSTRUMENTS Particulars a) Derivatives outstanding as at reporting date Forward contracts to buy USD Forward contracts to buy USD Forward contracts to buy USD Forward contracts to buy USD b) Mark to market losses Mark to market gains (net) not recognised 44. SEGMENT REPORTING The company is engaged in manufacture, purchase and sale of beer including licensing of brands which constitutes a single business segment. The company operates only in India. Accordinlgy, primary and secondary reporting disclosures for business and geographical segment as envisaged in AS-17 are not applicable to the company. 45. PREVIOUS YEAR FIGURES a) The previous years figures have been regrouped to conform to current years classification. Further in view of the amalgamations described in Note 38 above, the figures for the current year are not comparable with those of previous year. b) The financial statements for year ended March 31, 2011 had been prepared as per the then applicable, prerevised Schedule VI to the Companies Act, 1956. Consequent to the notification of Revised Schedule VI under the Companies Act, 1956, the financial statements for the year ended March 31, 2012 are prepared as per Revised Schedule VI. Accordingly, the previous year figures have also been reclassified to conform to this year's classification. The adoption of Revised Schedule VI for the previous year figures does not impact recognition and measurement principles followed for preparation of financial statements. For Price Waterhouse Firm Registration Number: 007568 S Chartered Accountants Usha A Narayanan Partner Membership No. -23997 Bangalore, June 8, 2012 Kalyan Ganguly Managing Director Govind Iyengar Senior Vice PresidentLegal & Company Secretary Bangalore, June 8, 2012 Guido de Boer Director, CFO Purpose As at March 31, 2012 As at March 31, 2011
Hedge of External commercial borrowings Hedge of External commercial borrowings Hedge of External commercial borrowings Hedge of Foreign currency loan
USD 20 Million, Rs.52.70 USD 50 Million, Rs.49.285 USD 1.38 Million, Rs.45.06
USD 10 Million, Rs.46.56 USD 6.94 Million, Rs.45.06
212
65
66
Rs. in lacs Net aggregate Profit/(Loss) of the subsidiary so far as it concerns the Members of the Company Not dealt with in the Accounts of the Company (i) For previous Financial Years of Subsidiary since it became a Subsidiary 20 For the Subsidiarys Financial year ended 31.03.2012 (ii) (i) Dealt with in the Accounts of the Company (ii) For previous Financial years of Subsidiary since it became a Subsidiary 51% 32 DISCLOSURE UNDER CLAUSE 32 OF THE LISTING AGREEMENT Rs. in lacs Amount outstanding as at March 31, 2012 (120) (18) Value of investments as at March 31, 2012 2541 1 Terms
STATEMENT PURSUANT TO SECTION 212(1)(e) OF THE COMPANIES ACT, 1956 AS AT MARCH 31, 2012
b) Extent of Holdings a) No. of Equity Shares at the end of the financial year of the Subsidiary
Sl. No.
Name of the Subsidiary United Breweries Other Subsidiary United Breweries Other Subsidiary For Subsidiarys Limited Companies Limited Companies Financial year ended 31.03.2012
1. Maltex Malsters Limited
22,950
Name of the Company
Subsidiaries: Maltex Malsters Limited
Associates: United East Bengal Football Team Pvt. Ltd.
Auditors Report on the Consolidated Financial Statements

The Board of Directors of United Breweries Limited 1. We have audited the attached consolidated balance sheet of United Breweries Limited (the Company) and its subsidiary; hereinafter referred to as the Group (refer Note 41 to the attached consolidated financial statements) as at March 31, 2012, the related consolidated Statement of Profit and Loss and the consolidated Cash Flow Statement for the year ended on that date annexed thereto, which we have signed under reference to this report. These consolidated financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit. 2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. 3. We did not audit the financial statements of the subsidiary included in the consolidated financial statements, which constitute total assets of Rs.344 lakhs and net assets of Rs.166 lakhs as at March 31, 2012, total revenue of Rs.82 lakhs, net profit of Rs.47 lakhs and net cash flows amounting to Rs.26 lakhs for the year then ended. These financial statements and other financial information have been audited by other auditor whose report has been furnished to us, and our opinion on the consolidated financial statements to the extent they have been derived from such financial statements is based solely on the report of such other auditor. 4. We draw your attention to Note 38(I)(B) to the attached financial statements regarding the recognition of gains, aggregating Rs. 14,049 lakhs, on sale of equity shares of the Company during the year by UBL Benefit Trust, of which the Company is the sole beneficiary, by way of credit to General Reserves Account in the absence of any specific accounting treatment being prescribed in the Accounting Standards notified pursuant to the Companies (Accounting Standards) Rules, 2006 as per Section 211(3C) of The Companies Act, 1956. Our conclusion is not qualified in this respect. 5. We report that the consolidated financial statements have been prepared by the Companys Management in accordance with the requirements of Accounting Standard (AS) 21 - Consolidated Financial Statements notified under sub-section 3C of Section 211 of The Companies Act, 1956. 6. Based on our audit and on consideration of reports of other auditor on separate financial statements and on the other financial information of the component of the Group as referred to above, and to the best of our information and according to the explanations given to us, in our opinion, the attached consolidated financial statements give a true and fair view in conformity with the accounting principles generally accepted in India: a) in the case of the consolidated Balance Sheet, of the state of affairs of the Group as at March 31, 2012; b) in the case of the consolidated Statement of Profit and Loss, of the profit of the Group for the year ended on that date; and c) in the case of the consolidated Cash Flow Statement, of the cash flows of the Group for the year ended on that date.
For Price Waterhouse Firm Registration Number 007568 S Chartered Accountants
Usha A Narayanan Partner Membership Number 23997
67
Consolidated Balance Sheet as at March 31, 2012

(All amounts in Rs.lacs, unless otherwise stated) Note EQUITY AND LIABILITIES Shareholders' funds Share capital Reserves and surplus Share capital pending allotment Minority Interest Non-current liabilities Long-term borrowings Deferred tax liabilities (Net) Long-term provisions Current liabilities Short-term borrowings Trade payables Other current liabilities Short-term provisions Total ASSETS Non-current assets Fixed assets Tangible assets Intangible assets Capital work-in-progress Goodwill on consolidation Non-current investments Interest in UBL Benefit Trust (Refer Note 38) Long-term loans and advances Other non-current assets Current assets Inventories Trade receivables Cash and bank balances Short-term loans and advances Other current assets TOTAL The notes referred above form an integral part of these financial statements. This is the consolidated Balance Sheet referred to in our report of even date. For Price Waterhouse Firm Registration Number: 007568 S Chartered Accountants Usha A Narayanan Partner Membership No. -23997 Bangalore, June 8, 2012 For and on behalf of the Board of Directors of United Breweries Limited Kalyan Ganguly Managing Director Govind Iyengar Senior Vice PresidentLegal & Company Secretary Bangalore, June 8, 2012 Guido de Boer Director, CFO As at March 31, 2012 As at March 31, 2011
3 4 5 43 6 7 8
10,051 126,524 136,575 115 40,280 5,136 1,108 46,524 43,555 57,394 41,233 4,017 146,199 329,413
27,235 102,209 129,444 92 115 27,472 2,886 704 31,062 34,023 38,992 42,843 3,944 119,802 280,515
9 10 11 8
12 119,950 2,032 20,736 2,421 5 14,392 1,166 160,702 40,067 69,997 17,740 29,315 11,592 168,711 329,413 106,345 2,732 7,196 4,380 2 14,294 12,001 1,086 148,036 28,981 52,002 12,907 29,165 9,424 132,479 280,515
42 13 14 15
16 17 18 14 19
68
Consolidated Statement of Profit and Loss for the year ended March 31, 2012
(All amounts in Rs.lacs, unless otherwise stated) Note Income Revenue from operations (gross) Less: Excise duty Revenue from operations (net) Other income Total revenue (I) Expenses Cost of materials consumed Purchases of stock-in-trade Changes in inventories of finished goods, work-in-progress and stock-in-trade Employee benefits expense Other expenses Total expenses (II) Earnings before interest, tax, depreciation and amortisation (I-II) Finance costs Depreciation and amortisation expense Profit before Exceptional Items and Tax Exceptional Item: Provision for impairment of Goodwill Profit before tax Tax expense: (1) Current tax (2) MAT credit (availed) / utilised (3) Deferred tax charge / (write back) Profit for the period Earnings per Equity share in Rs. [Nominal value per share Re.1 each (2011: Re.1 each)] (1) Basic (2) Diluted The notes referred above form an integral part of these financial statements. This is the consolidated Statement of Profit and Loss referred to in our report of even date. For Price Waterhouse Firm Registration Number: 007568 S Chartered Accountants Usha A Narayanan Partner Membership No. -23997 Bangalore, June 8, 2012 For and on behalf of the Board of Directors of United Breweries Limited Kalyan Ganguly Managing Director Govind Iyengar Senior Vice PresidentLegal & Company Secretary Bangalore, June 8, 2012 Guido de Boer Director, CFO 37 4.69 4.69 5.27 5.27 4,942 1,137 3,059 12,677 4,778 (4,762) 7,893 14,749 42 31 12 26 27 28 29 30 159,220 4,230 (1,825) 19,129 140,511 321,265 48,553 9,890 14,889 23,774 1,959 21,815 133,258 6,007 337 14,413 112,933 266,948 43,532 7,793 13,081 22,658 22,658 25 24 586,572 224,057 362,515 7,303 369,818 460,450 154,469 305,981 4,499 310,480 Year ended March 31, 2012 March 31, 2011
69
Consolidated Cash Flow Statement for the year ended March 31, 2012
(All amounts in Rs.lacs, unless otherwise stated) Year ended March 31, 2012 A Cash flow from operating activities Profit before taxation Adjustments for: Depreciation and amortisation (Profit)/Loss on sale of assets Provision for doubtful debts Provision for doubtful advances Provision for dimunition in investments Bad debts written off Bad advances written off Provision for doubtful debts no longer required written back Provision for doubtful advances no longer required written back Interest expenses (Net) Interest income Exchange Loss / (Gains) on foreign currency loans Dividend income Operating profits before working capital changes Adjustment for working capital changes: (Increase) / Decrease in Trade Receivables (Increase) / Decrease in inventories Increase / (Decrease) in current liabilities and provisions (Increase) / Decrease in other current assets, loans and advances Cash generated from operations Direct taxes (Income Tax and Fringe Benefit Tax) paid (including TDS) Cash generated from operations before non-recurring items Non-recurring items Net cash generated from operating activities B Cash flow from investing activities Purchase of fixed assets (including acquisition on amalgamation) Sale of fixed assets (Purchase) / Sale of investments Interest income Dividend income Net cash used in investing activities (38,141) 79 (2) 3,538 19 (34,507) (44,010) 124 4,899 87 42 (38,858) (17,171) (10,741) 27,724 (2,918) (3,106) 41,882 (6,588) 35,294 35,294 15,266 (6,944) 15,146 (1,337) 22,131 62,274 (5,161) 57,113 57,113 14,889 (1) 49 64 1,959 954 980 (1,290) (998) 9,850 (3,304) 40 (19) 23,173 44,988 13,081 (2) 317 17 9 (9) (513) 7,793 (3,166) (42) 17,485 40,143 21,815 22,658 March 31, 2011
70
Consolidated Cash Flow Statement for the year ended March 31, 2012 (contd.)
(All amounts in Rs.lacs, unless otherwise stated) Year ended March 31, 2012 C Cash Flow from Financing activities (Repayment) / Proceeds from unsecured term loans (net) (Repayment)/Proceeds from bank borrowings (net) On merger Repayment of preference share capital Proceeds from UBL Benefit Trust Interest paid Dividend paid (including distribution tax) Net cash generated from financing activities Net Increase / (Decrease) in cash and cash equivalents Opening cash and cash equivalents Cash on hand including remittances in transit Bank Balances including cheques on hand Cash and cash equivalents of transferor company as at April 1, 2011 Closing cash and cash equivalents Cash on hand including remittances in transit Bank balances including cheques on hand 35 17,705 17,740 34 12,873 12,907 34 12,873 12,907 17 32 9,234 9,266 (19,033) 24,438 (17,283) 28,343 (9,754) (2,682) 4,029 4,816 17,997 (19,331) (3,741) (7,665) (1,874) (14,614) 3,641 March 31, 2011
Notes: 1. The above cash flow statement has been compiled from and is based on the balance sheet as at March 31, 2012 and the related profit and loss account for the year ended on that date. 2. The above Cash Flow Statement has been prepared in consonance with the requirements of Accounting Standard (AS)-3 on Cash Flow Statements as notified under the Companies (Accounting Standards) Rules, 2006 and the reallocations required for the purpose are as made by the company. 3. Cash and cash equivalents include Rs.465 (2011: Rs.1,706) which are not available for use by the Company. This is the cash flow statement referred to in our report of even date For Price Waterhouse Firm Registration Number: 007568 S Chartered Accountants Usha A Narayanan Partner Membership No. -23997 Bangalore, June 8, 2012 For and on behalf of Board of Directors of United Breweries Limited Kalyan Ganguly Managing Director Govind Iyengar Senior Vice PresidentLegal & Company Secretary Bangalore, June 8, 2012 Guido de Boer Director, CFO
71
Notes to Consolidated Financial Statements

1. General Information: (All amounts in Rs.lacs, unless otherwise stated) United Breweries Limited (UBL) is engaged primarily in the manufacture and sale of beer. The Company has manufacturing plants in India and sells its product only in India. The Company is a public limited company and is listed on the Bombay Stock Exchange (BSE), Bangalore Stock Exchange (BgSE) and the National Stock Exchange (NSE). 2. 2.1 Summary of Significant Accounting Policies Basis of Presentation of Financial Statements The Financial Statements of the Company have been prepared under historical cost convention, to comply in all material aspects with the applicable accounting principles in India, the applicable accounting standards notified under Section 211(3C) of the Companies Act, 1956 and to relevant provisions of the Companies Act, 1956. All assets and liabilities have been classified as current or non-current as per the Companys normal operating cycle and other criteria set out in the Schedule VI to the Companies Act, 1956. Based on the nature of products and the time between the 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 non current classification of assets and liabilities. 2.2 Basis of Consolidation: The Financial Statements of the Subsidiary used in the consolidation are drawn up to the same reporting date as that of the parent company, i.e., year ended March 31, 2012. The Consolidated Financial Statement (CFS) presents the consolidated accounts of United Breweries Limited (the Company) and its Subsidiary as shown below: Name of the Subsidiary Maltex Malsters Limited (MML) Ownership Percentage 2012 2011 51 51 Country of Incorporation India
The Companys interest in United East Bengal Football Team Private Limited (UEBFTPL), an associate of the Company has not been included in consolidation as the same is not considered material. 2.3 Use of Estimates: The preparation of the Financial Statements in conformity with Generally Accepted Accounting Policies (GAAP) in India requires that the management makes estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent liabilities as at the date of the Financial Statements, and the reported amounts of revenue and expenses during the reported period. Actual result could differ from those estimates. 2.4 Principles of Consolidation: i) The financial statement of the parent company and its subsidiary have been consolidated on a line by line basis by adding together the book values of like items of assets, liabilities, income and expenditure after eliminating intra group balances and intra group transactions. ii) The financial statements of the parent company and its subsidiary have been consolidated using uniform accounting policies for like transactions and other events. iii) Goodwill represents the difference between the companys share in the net-worth and the cost of acquisition of subsidiary. Goodwill arising on consolidation is not amortised. Negative goodwill is recognised as capital reserve on consolidation. 2.5 Revenue Recognition: Revenue from sale of goods is recognised in accordance with the terms of sale, on dispatch from the Breweries/ warehouses of the Company and is net of trade discount and Value Added Tax (VAT) where applicable but includes Excise Duty. Income from brand franchise is recognised at contracted rates on sale/production of the branded products by the franchisees. Dividend Income is recognised when the Companys right to receive the payment is established on or before the balance sheet date. Royalty from foreign entities (net of tax), technical advisory and management fees is recognised as per the terms of agreement. Interest income is recognized on accrual basis. 2.6 Borrowing Costs: Borrowing costs incurred for the acquisition of qualifying assets are recognised as a part of cost of such assets when it is considered probable that they will result in future economic benefits to the Company while other borrowing costs are expensed in the period in which they are incurred.
72
Notes to Consolidated Financial Statements (contd.)

2.7 (All amounts in Rs.lacs, unless otherwise stated) Fixed Assets: Fixed assets are stated at their original cost of acquisition and subsequent improvements thereto including taxes, duties, freight and other incidental expenses relating to acquisition and installation of such assets. Investments: Long term investments are carried at cost less provision made to recognise any decline, other than temporary, in the values of such investments. Current investments are carried at cost or net realisable value, whichever is lower. Inventories: Inventories are valued at lower of cost and net realisable value. Costs include freight, taxes, duties and appropriate production overheads and are generally ascertained on the First in First out (FIFO) basis. Excise/Customs duty on stocks in bond is added to the cost. Due allowance is made for obsolete and slow moving items.
2.8
2.9
2.10 Foreign Currency Transactions: a) Foreign currency transactions are recorded at the rates of exchange prevailing on the dates of such transactions. b) All monetary assets and liabilities in foreign currency are restated at the end of accounting period. With respect to long-term foreign currency monetary items, from April 1, 2011 onwards, the Company has adopted the following policy: Foreign exchange difference on account of a depreciable asset, is adjusted in the cost of the depreciable asset / Capital work-in-progress, which would be depreciated over the balance life of the asset. In other cases, the foreign exchange difference is accumulated in a Foreign Currency Monetary Item Translation Difference Account, and amortised over the balance period of such long term asset / liability. A monetary asset or liability is termed as a long-term foreign currency monetary item, if the asset or liability is expressed in a foreign currency and has a term of 12 months or more at the date of origination of the asset or liability. Exchange differences on restatement of all other monetary items are recognised in the Statement of Profit and Loss. The premium or discount arising at the inception of forward exchange contracts entered into to hedge an existing asset / liability, is amortised as expense over the life of the contract. Exchange differences on such a contract are recognised in the Statement of Profit and Loss in the reporting period. Any profit or loss arising on cancellation or renewal of such a forward exchange contract is recognised as income or as expense for the period. Forward exchange contracts outstanding as at the year end on account of firm commitment / highly probable forecast transactions are marked to market and the losses, if any, are recognised in the Statement of Profit and Loss and gains are ignored in accordance with the Announcement of Institute of Chartered Accountants of India on Accounting for Derivatives issued in March 2008. 2.11 Depreciation and amortisation: Depreciation on fixed assets is provided on Straight Line Method based on the rates prescribed under Schedule XIV to the Companies Act, 1956 except as indicated below: a) Plant and Machinery are depreciated at the rate of 10.34%. Further, depreciation is provided at higher rates in respect of certain specific items of plant and machinery having lower useful life based on technical evaluation carried out by the management. b) Assets acquired on amalgamation (where original dates of acquisition are not readily available), are depreciated over the remaining useful life of the assets as certified by an expert. c) Cost of Goodwill arising on amalgamation is amortised over a period of 5 years. d) Other intangible assets are amortised on straight line basis over a period of 10 years. e) Cost of Leasehold Land is amortised over the period of lease. f) Assets purchased / sold during the year are depreciated from the month of purchase / until the month of sale of asset on a proportionate basis. 2.12 Employee benefits: i) Defined-contribution plans: Provident Fund: Contribution towards provident fund for certain employees is made to the regulatory authorities, where the Company has no further obligations. Such benefits are classified as Defined Contribution Schemes as the Company does not carry any further obligations, apart from the contributions made on a monthly basis.
73

(All amounts in Rs.lacs, unless otherwise stated) Contributions to the Employees Provident Fund, Superannuation Fund, Employees State Insurance and Employees Pension Scheme are as per statute and are recognised as expenses during the period in which the employees perform the services. ii) Defined-benefit plans: Provident fund: In respect of certain employees, Provident Fund contributions are made to a Trust administered by the Company. The Companys liability is actuarially determined (using the Projected Unit Credit method) at the end of the year and any shortfall in the fund size maintained by the Trust set up by the Company is additionally provided for. Actuarial losses / gains are recognised in the Statement of Profit and Loss in the year in which they arise. Gratuity: Liability towards gratuity is determined on actuarial valuation using the Projected Unit Credit Method at the balance sheet date. Actuarial Gains and Losses are recognised immediately in the Statement of Profit and Loss. iii) Other long term employee benefits: Liability towards leave encashment and compensated absences is recognised at the present value based on actuarial valuation at each balance sheet date. iv) Short term employee benefits: Undiscounted amount of liability towards earned leave, compensated absences, performance incentives etc. is recognised during the period when the employee renders the services. 2.13 Taxation: Current tax is determined as per the provisions of the Income Tax Act, 1961 i) Provision for current tax is made, based on the tax payable under the Income Tax Act, 1961. Minimum Alternative Tax (MAT) credit, which is equal to the excess of MAT (calculated in accordance with the provisions of section 115JB of the Income Tax Act,1961) over normal income-tax is recognized as an asset by crediting the Statment of Profit and Loss only when and to the extent there is convincing evidence that the Company will be able to avail the said credit against normal tax payable during the period of ten succeeding assessment years. ii) Deferred tax is recognised, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets are not recognised unless there is virtual certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. 2.14 Earnings per share: Annualised earnings / (loss) per equity share (basic and diluted) is arrived at based on ratio of profit / (loss) attributable to equity shareholders to the weighted average number of equity shares. 2.15 Impairment of Assets: At each Balance Sheet date, the Company assesses whether there is any indication that assets may be impaired. If any such indication exists, the Company estimates the recoverable amount. If the carrying amount of the assets exceeds its recoverable amount, an impairment loss is recognised in the accounts to the extent the carrying amount exceeds the recoverable amount. 2.16 Provisions, Contingent Liabilities and Contingent Assets: Provisions are recognised when the company has a present obligation as a result of past events, for which it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate of the amount can be made. Provisions are reviewed regularly and are adjusted where necessary to reflect the current best estimates of the obligation. When the company expects a provision to be reimbursed, the reimbursement is recognised as a separate asset, only when such reimbursement is virtually certain. A disclosure for contingent liability is made where there is a possible obligation or present obligation that may probably not require an outflow of resources. 2.17 Leases Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to the Statement of Profit and Loss on a straight-line basis over the period of the lease.
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(All amounts in Rs.lacs, unless otherwise stated) As at March 31, 2012 3. SHARE CAPITAL Authorised 3,674,000,000 (2011: 3,620,000,000) Equity shares of Re.1 each 58,600,000 (2011: 49,140,000) Preference Shares of Rs.100 each Issued, Subscribed and Paid-up 264,405,149 (2011: 254,544,938) Equity shares of Re.1 each fully paid 3% Nil (2011: 17,283,000) Cumulative Redeemable Preference Shares of Rs.100 each fully paid - Series A 3% 7,407,000 (2011: 7,407,000) Cumulative Redeemable Preference Shares of Rs.100 each fully paid - Series B 2,644 7,407 10,051 2,545 17,283 7,407 27,235 36,740 58,600 95,340 36,200 49,140 85,340 As at March 31, 2011
Cumulative Redeemable Preference Shares - Series A are redeemable at par at the earliest on March 31, 2011 and are extendable upto March 31, 2015 based on mutual agreement between the Company and Scottish and Newcastle India Limited (the preference shareholder). The shares have been redeemed at par on April 14, 2011. Cumulative Redeemable Preference Shares - Series B are redeemable at par at the earliest on March 31, 2015. a) Reconciliation of number of shares Equity shares Balance as at the beginning of the year Issued during the year - amalgamations (Refer Note 38) Scottish & Newcastle India Pvt. Ltd. at the ratio of 6:31 in lieu of equity shares of Millennium Alcobev Pvt. Ltd. UBL Benefit Trust at the ratio of 33:16 in lieu of equity shares of Empee Breweries Ltd. Heineken International B.V. at the ratio of 135:1 in lieu of equity shares of UB Ajanta Breweries Pvt. Ltd. UB Overseas Limited at the ratio of 135:1 in lieu of equity shares of UB Ajanta Breweries Pvt. Ltd. Heineken International B.V. at the ratio of 454:1 in lieu of equity shares of UB Nizam Breweries Pvt. Ltd. UB Overseas Limited at the ratio of 454:1 in lieu of equity shares of UB Nizam Breweries Pvt. Ltd. United Spirits Limited at the ratio of 30:17 in lieu of equity shares of Chennai Breweries Pvt. Ltd. Public shareholders of erstwhile Millennium Beer Industries Ltd. at the ratio of 12:1 Outstanding at the end of the year * Rounded off to Rs.2,644 8,489,270 85 As at March 31, 2012 Nos. 254,544,938 Rs. As at March 31, 2011 Nos. Rs. 2,400
2,545 240,048,255
354,789 354,789 72,951 72,951 8,500,000 504,731 264,405,149
4 4 1 1 85 5
6,007,413
60 2,545
2,644* 254,544,938
75
Notes to the Consolidated Financial Statements (contd.)

(All amounts in Rs.lacs, unless otherwise stated) Preference shares Preference shares - Series A Balance as at the beginning of the year Issued during the year Redeemed during the year Outstanding at the end of the year Preference shares - Series B Balance as at the beginning of the year Issued during the year Redeemed during the year Outstanding at the end of the year 7,407,000 7,407,000 7,407 7,407 7,407,000 7,407,000 7,407 7,407 17,283,000 17,283,000 17,283 17,283 17,283,000 17,283,000 17,283 17,283 As at March 31, 2012 Nos. Rs. As at March 31, 2011 Nos. Rs.
b) Rights, preferences and restrictions attached to shares Equity Shares: The company has one class of equity shares having a par value of Re.1 per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding. 3% Redeemable preference shares - Series A: 17,283,000, 3% Redeemable preference shares of Rs.100 each were issued in April 2005 to the Scottish & Newcastle India Limited. These shares have been redeemed on April 14, 2011. In the event of liquidation, the preference shareholders are eligible to receive the paid up value of the preference shares along with arrears of preference dividend if any out of the remaining assets of the company in preference to equity shareholders. 3% Redeemable preference shares - Series B: 7,407,000, 3% Redeemable preference shares of Rs.100 each were issued in April 2005 to the Scottish & Newcastle India Limited. These shares are redeemable at par at the earliest on March 31, 2015. In the event of liquidation, the preference shareholders are eligible to receive the paid up value of the preference shares along with arrears of preference dividend if any out of the remaining assets of the company in preference to equity shareholders. c) Details of shares held by shareholders holding more than 5% of the aggregate shares in the Company As at March 31, 2012 Equity shares of Re.1 each fully paid Scottish & Newcastle India Limited United Breweries Holdings Limited Dr. Vijay Mallya Preference shares of Rs.100 each fully paid - Series A Scottish & Newcastle India Limited Preference shares of Rs.100 each fully paid - Series B Scottish & Newcastle India Limited 7,407,000 100.00% 7,407,000 100.00% 24,690,000 100.00% Nos. 89,994,960 30,295,911 21,353,620 % holding in the class 34.04% 11.46% 8.09% As at March 31, 2011 Nos. 89,994,960 30,295,911 21,353,620 % holding in the class 35.36% 11.90% 8.39%
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(All amounts in Rs.lacs, unless otherwise stated) d) Shares allotted as fully paid up pursuant to contract(s) without payment being received in cash (during 5 years immediately preceding March 31, 2012). 2011-12: 9,860,211 equity shares issued on account of amalgamation of Chennai Breweries Private Limited, UB Nizam Breweries Private Limited, Millennium Beer Industries Limited and UB Ajanta Breweries Private Limited. 2010-11: 14,496,683 equity shares issued on account of amalgamation of Millennium Alcobev Private Limited and Empee Breweries Limited. As at March 31, 2012 4. RESERVES AND SURPLUS Securities premium account Capital reserve Opening balance Add: Additions on amalgamations [Refer Note 38(I)(A)] Less: Deductions on amalgamations [Refer Note 38(I)(A)] Closing balance General reserve Opening balance Add: Transferred from surplus in Statement of Profit and Loss Add: Gain on sale of interest in UBL Benefit Trust [Refer Note 38(I)(B)] Closing balance Surplus in Statement of Profit and Loss Opening balance Add: Profit for the year Less: Appropriations - Proposed dividends (Refer Note 22) - Transfer to General reserve Closing balance Total Reserves and Surplus 5. SHARE CAPITAL PENDING ALLOTMENT Nil (2011: 9,150,633) Equity shares of Re. 1 each pending allotment [Refer Note 38(ii)] 92 2,439 1,500 40,271 126,524 2,703 1,500 31,533 102,209 31,533 12,677 20,987 14,749 4,200 1,500 2,700 1,500 1,258 28 1,286 1,258 1,258 65,218 65,218 As at March 31, 2011
14,049 19,749
4,200
77

(All amounts in Rs.lacs, unless otherwise stated) 6. LONG-TERM BORROWINGS Non-current portion As at March 31, 2012 Secured borrowings Foreign currency term loans External commercial borrowing from banks Term loan from banks Indian currency term loans Other loans Unsecured borrowings From banks Deferred payment liabilities Amount disclosed under the head " Other current liabilities" (Note 11) Total 4,470 4,470 40,280 19,033 4,470 23,503 27,472 1,533 1,533 (3,858) 1,533 1,533 (16,317) 35,810 35,810 625 3,344 3,969 625 1,700 2,325 4,656 3,756 5,316 1,056 14,784 As at March 31, 2011 Current portion As at March 31, 2012 As at March 31, 2011
Nature of security and terms of repayment for secured borrowings Nature of security Foreign currency term loans HDFC Bank Ltd: Rs.625 (2011: Rs.3,125) secured by Repayable in 16 quarterly instalments from the date of first pari-passu charge on all moveable and immoveable loan (June 2008) along with interest of 9.45% per annum properties of the company except Taloja, Aurangabad, (fully hedged) Dharuhera, Chennai Breweries, Empee Breweries, UB Nizam, UB Ajanta and Srikakulam breweries. DBS Bank Ltd: Rs.25,578 (2011: Rs. Nil) secured by pari- Repayable from February 27, 2016 i.e. end of 4th year in 9 passu charge on other than current assets of present equal quarterly instalments of till February 27, 2018 along and future except Taloja and Aranvoyal breweries. with interest of 9.58% per annum (fully hedged) Rabobank International: Rs.10,232 (2011: Rs. Nil) secured 3 year ECB Loan repayable on January 10, 2015. Interest by pari-passu charge on other than current assets of of 7.15% per annum payable on quarterly basis (fully present and future except Taloja and Aranvoyal Breweries. hedged) BNP Paribas: Rs.Nil (2011: Rs.4,656) secured by first Repayable in December 2011 on completion of 5 years charge on all moveable and immovable properties of from the date of loan (December 2006) along with interest the Company except Taloja, Aurangabad, Dharuhera, of 8.85% per annum (fully hedged) Chennai Breweries, Empee Breweries, UB Nizam, UB Ajanta and Srikakulam breweries. Axis Bank Ltd: Rs.Nil (2011: Rs.1,256) secured by first Repayable in 16 quarterly instalments from the date of charge on fixed assets and current assets of Srikakulam loan (December 2007) along with interest of 6-months brewery. Libor + 275 basis points (not hedged) Terms of repayment
78

(All amounts in Rs.lacs, unless otherwise stated) Nature of security Indian currency term loans Citibank Ltd.: Rs.Nil (2011: Rs.3,288) secured by first Repayable in 73 monthly instalments after completion of charge on all moveable and immoveable properties of one year moratorium period from the date of loan (April the company except Taloja, Aurangabad, Dharuhera, 2006) along with interest of 8.5% per annum Chennai Breweries, Empee Breweries, UB Nizam, UB Ajanta and Srikakulam breweries. Standard Chartered Bank: Rs.1,700 (2011: Rs.4,250) Repayable in 56 monthly instalments from the date of loan secured by first mortgage and charge on all immoveable (February 2008) along with interest of 12% per annum and movable properties (excluding current assets) of Chennai Breweries. Yes Bank: Rs. Nil (2011: Rs.560) secured by second Repayable in 60 monthly instalments from the date of loan charge on all moveable and immoveable assets of (March 2007) along with interest of 13% per annum Empee Breweries BNP Paribas: Rs.Nil (2011: Rs.562) secured by first Repayable in 48 monthly instalments after completion charge on all moveable and immoveable assets of of one year moratorium period from the date of loan Empee Breweries (September 2006) along with interest of 9.71% per annum Rabo India Finance Ltd.: Rs. Nil (2011: Rs.1,056) secured Repayable in 59 equal monthly instalments from January by exclusive charge on all moveable and immovable 2007 along with interest of 1 year Government of India properties and second charge on all current assets Security yield + 225 basis points per annum. Interest rate reset on annual basis. Unsecured borrowings Deferred sales tax liability of Millennium Beer Industries This amount is repayable in 10 years from May 2013. Ltd. - Aurangabad unit amounting to Rs.4,470 (2011: Rs.4,470) is payable to the Government of Maharashtra by virtue of being eligible after having established a manufacturing unit in a notified backward area. The confirmation of the sanction to the Company is contained in Certificate of Entitlement No. 431133-S/R31B/Pioneer Unit /1322 dated 17.07.2002 issued under Part-I of the 1993 Package Scheme of Government of Maharashtra. ICICI Bank Ltd: Rs.Nil (2011: Rs.17,500) covered by Loan availed in October 2008, repayable in 2 annual personal guarantee of a director of the company installments starting from end of 4th & 5th year from date of first drawdown. This has been repaid during the current year. Applicable interest rate is 15.7%. Citibank: Rs.1,533 (2011: Rs.3,066) shown as current Loan availed in February 2010 repayable in 3 annual liablities since payable within next 12 months period equal instalments from February 2011. Applicable interest rate is 12%. Terms of repayment
79

(All amounts in Rs.lacs, unless otherwise stated) As at March 31, 2012 7. DEFERRED TAX LIABILITIES (NET) Deferred tax asset Provision for doubtful advances and debts Gratuity and compensated absenses Bonus provision Carryforward losses for amalgamated companies Share of subsidiary Gross deferred tax asset Deferred tax liability Depreciation Deferred tax asset utilised from carry forward loss and depreciation of amalgamated companies Gross deferred tax liability Net deferred tax liability 5,945 809 6,754 5,136 4,581 7,973 12,554 2,886 252 506 48 809 3 1,618 888 355 36 8,387 2 9,668 As at March 31, 2011
Deferred tax asset and liabilities have been set off as they relate to same governing taxation laws. Long-term As at March 31, 2012 8. PROVISIONS Provision for employee benefits Gratuity Compensated absenses Other provisions Provision for proposed dividend and tax there on Provision for water charges Provision for local area development tax Provision for customs duty Total 1,108 Local area development tax As at March 31, 2012 Balance as at the beginning of the year 284 Additions Amounts used Unused amounts reversed Balance as at the end of the year 122 406 704 2,438 554 406 168 3,566 4,017 Water charges As at March 31, 2011 316 90 406 2,703 406 284 167 3,560 3,944 381 727 1,108 85 619 704 182 269 451 154 230 384 As at March 31, 2011 Short-term As at March 31, 2012 As at March 31, 2011
As at As at March 31, 2011 March 31, 2012 170 406 114 284 148 554
Provision for local area development tax, water charges and customs duty matters are sub-judice. There are no additions, amounts used or unused amounts reversed during the year with respect to customs duty.
80

(All amounts in Rs.lacs, unless otherwise stated) As at March 31, 2012 9. SHORT-TERM BORROWINGS Secured borrowings Working capital loan / cash credit from banks (Repayable on demand) Unsecured borrowings Short-term loans from banks From others# Total 5,000 35 5,035 43,555 7,500 37 7,537 34,023 38,520 38,520 26,486 26,486 As at March 31, 2011
Working capital loan from banks are secured by hypothecation of stock-in-trade, stores, raw materials, book debts. Short-term loans from banks comprise of ING Vysya Bank: Rs.2,500 (2011: Rs.5,000) repayable in maximum of 365 days and Yes Bank: Rs.2,500 (2011: Rs.2,500) repayable in maximum of 90 days. # Includes Loan from directors are unsecured, repayble on demand and carries interest @ 13.25% p.a. As at March 31, 2012 10. TRADE PAYABLES Acceptances Sundry Creditors (Refer note 23) Others Creditors - Capex 2,583 57,394 966 38,992 22,872 31,939 9,024 29,002 As at March 31, 2011
11. OTHER CURRENT LIABILITIES Current maturities of long-term borrowings: Secured (Refer Note 6) Interest accrued but not due on borrowings Current maturities of long-term debt: Unsecured (Refer Note 6) Security deposits Unpaid dividends* Other payables - Statutory dues - Advances received from customers - Overtime and bonus payable - Other expenses payable Total 11,174 861 341 22,690 35,066 41,233 7,701 811 300 15,772 24,584 42,843 2,325 626 2,951 1,533 1,639 44 3,216 14,784 490 15,274 1,533 1,430 22 2,985
* There are no amounts due for payment to the Investor Education and Protection Fund under section 205C of the Companies Act, 1956 as at the year end.
81
82
(All amounts in Rs.lacs, unless otherwise stated)
Gross Block Addition Additions Deletions/ As at on Amalgaadjustments March 31, mation 2012 As at April 1, 2011 Addition On Deletions For on Amalgathe year mation 700 30 639 4,360 615 11,518 31 6,543 2,016 16 2,032 6,512 3,721 585 10,818 13,550 631 6,376 6,543 Depreciation / Amortisation Net Block As at As at As at March 31, March 31, March 31, 2012 2012 2011 31 2,655 46 2,732 6,543 6,376 631 13,550 14,911 141 876 3,916 80 64 90 5 5,172 5,172 25,243 350 25,243 350 193,284 206,834 177 76 857 392 (90) 1,704 815 (2) 5,516 3,254 355 353 56,874 67,692 102 (75) 1,671 809 20,428 492 129,822 46,954 64 64 2,079 53 54 26 4 2,543 2,543 2,147 (51) 33,935 4,815 301 2 3,624 270 26 214 11 1 46 272 272 1,180 3,481 30,861 64 1,414 4,635 1,132 751 16,091 116 1,333 11,623 155 715 175 72 14,189 14,889 412 6,449 64 60,442 1,006 4,022 556 383 73,334 84,852 16,091 3,212 27,486 69,380 665 1,494 1,148 474 119,950 121,982 20,736 142,718 60,420 6,269 17,530 176,769 40,788 22,646 8,823 13,081 67,692 14,911 3,211 26,046 59,016 605 1,381 777 398 106,345 109,077 7,196 116,273
12. FIXED ASSETS
As at April 1, 2011
Intangible
Goodwill
Licences & Rights
Brands
Total - Intangible
Tangible
Land - Freehold (Note a, b & c)
Land - Leasehold
Buildings
Leasehold Improvements
Plant and Machinery
105,970
Office Equipment
Furniture & Fittings
Lab Equipments
Vehicles
Total - Tangible
163,219
Total
176,769
Capital work-in-progress
As at March 31, 2011
127,610
Notes: a. The Company has obtained a stay against resumption proceedings initiated by MIDC over the Land aggregating 6 Acres valued at Rs.329 (2011: Rs.329) allotted by MIDC to MBIL (since amalgamated with the Company). The matter is yet to be finally heard. b. The Company has filed a Writ petition in the High Court of Kerala at Cochin seeking fixation of rate for issue of Final Patta with respect to land measuring 8.0937 hectares valued at Rs.1 (2011: Rs.1). The matter is yet to be heard. c. Land measuring 9.04 acres [Cost Rs.72 (2011: Rs.72)] is pending registration in the name of the Company. d. All the above pieces of land are in physical possession of the Company.
13. NON CURRENT INVESTMENTS (All amounts in Rs.lacs, unless otherwise stated)
Class of shares Number of shares/units Cost Cost Number of shares / units Face value in Rs. Face value in Rs. As at March 31, 2012 As at March 31, 2011
Trade Investments (valued at cost) Unquoted equity instruments In subsidiary companies - fully paid up shares: In associates: Equity 4,999 50.00 1 4,999 50 1
Equity Equity Equity Equity Equity Equity 3 3
2,000 300 50 100 100 5,000
25.00 10.00 10.00 5.00 3.00 100.00
1 0 0 0 0 1
2,000
25
United East Bengal Football Team Pvt. Limited Other Investments (valued at cost unless otherwise stated) Unquoted equity instruments Zorastrian Co-operative Bank Limited Skol Breweries Limited Jupiter Breweries Limited Mohan Meakins Limited Blossom Breweries Limited Cosmos co-operative Bank Limited In government and trustee securities National savings certificate [Net of provision for dimunition in value of investments of Rs.15 (2011: Rs.15)] Total 5 50,000 50,000 1,727 188 925 300 103,140
Following investments costing less than Rs.1 Lac have been disclosed below in absolute amount in rupees
United East Bengal Football Team Pvt Limited
Zorastrian Co-operative Bank Limited
Skol Breweries Limited
Jupiter Breweries Limited
Mohan Meakins Limited
Blossom Breweries Limited
Total
83

(All amounts in Rs.lacs, unless otherwise stated) Long-term As at March 31, 2012 14. LOANS AND ADVANCES Secured, considered good Other loans and advances Star Investments Private Limited (Refer Note 44) Unsecured, considered good Capital advances Security deposits Advances to suppliers Prepaid expenses Other loans and advances MAT credit entitlement Advance tax/TDS receivable (net of provision) Others Unsecured, considered doubtful Capital advances Security deposits Advances to suppliers Other loans and advances Allowance for bad and doubtful loans and advances Total As at March 31, 2011 Short-term As at March 31, 2012 As at March 31, 2011
8,624 4,424 123 1,221 14,392 51 6 (57) 14,392
7,385 4,485 101 30 12,001 42 740 (782) 12,001
15,500 15,500 627 3,522 2,858 3,624 3,076 108 13,815 41 (41) 29,315 As at March 31, 2012
15,500 15,500 659 3,244 2,311 4,762 1,430 1,259 13,665 52 151 (203) 29,165 As at March 31, 2011
15. OTHER NON CURRENT ASSETS Unsecured, Considered good Bank deposits with original maturity of greater than 12 months Others Sales tax recoverable Storage/privilage fee recoverable Total 16. INVENTORIES (net of obsolete provisions) Raw materials [Includes in transit: Rs.1,191 (2011: Rs.668)] Packing materials and bottles [Includes in transit: Rs.60 (2011: Rs.81)] Work-in-progress Finished goods* [Includes in transit: Rs.689 (2011: Rs.405)] Stock-in-trade Stores and spares [Includes in transit: Rs.12 (2011: Rs.4)] Total *Net of Obsolete provision of Rs.22 (2011: Rs.3)
26 1,127 13 1,166
1,073 13 1,086
11,070 6,551 12,732 5,331 1 4,382 40,067
8,603 4,659 8,680 3,395 46 3,598 28,981
84

(All amounts in Rs.lacs, unless otherwise stated) As at March 31, 2012 17. TRADE RECEIVABLES Unsecured, Considered good - Outstanding for a period exceeding six months from the date they are due for payment - Others Unsecured, Considered doubtful - Outstanding for a period exceeding six months from the date they are due for payment - Others Less: Provision for bad and doubtful debts Total 18. CASH AND BANK BALANCES Cash and cash equivalents Cash on hand Cheques, drafts on hand Bank balances In current account (Refer Note i) Demand deposits with maturity of less than 3 months Other balances with Banks In Deposits Less than 12 months but more than 3 months Greater than 12 months Margin money / security 668 12 (680) 69,997 1,706 39 (1,745) 52,002 3,114 66,883 1,147 50,855 As at March 31, 2011
34 1 2,047 15,000
17,082
29 5 9,415 1,700
11,149
105 88 465 658 17,740
53 1,705 1,758 12,907
i. Includes balance in Unpaid Dividend Account Rs.39 (2011: Rs.22) 19. OTHER CURRENT ASSETS Unsecured, Considered good Income accrued on deposits and others Excise duty deposits Total 20. CAPITAL COMMITMENTS Estimated amount of contract remaining to be executed (net of capital advances) on capital account and not provided for Other commitments 6,442 5,150 11,592 6,676 2,748 9,424
15,792
7,377
15,792
7,377
85

(All amounts in Rs.lacs, unless otherwise stated) As at March 31, 2012 21. CONTINGENT LIABILITIES a) Sales Tax/other taxes demands under appeal# b) Employees state insurance/Provident Fund demand# c) Demand towards water charges under appeal# d) Excise Duty/Customs Duty demands under appeal# e) Income Tax demands under appeal# f) Service Tax demands under appeal# g) Claims against the company not acknowledged as debt# h) Letter of undertaking to distributors towards countervailing duty for imports from Nepal# 1,349 19 2,694 491 10,345 7,513 1,002 23,413 1,304 23 1,825 413 4,038 2,446 413 385 10,847 As at March 31, 2011
# It is not practicable for the company to estimate the timing of cashflows if any, in respect of the above, pending resolution of the respective proceedings. The company does not expect any reimbursements in respect of the above contingent liabilities. 22. PROPOSED DIVIDENDS Dividend payable on Preference share capital @ Rs.3 per share (2011: Rs.3 per share) Dividend distribution tax payable on above Proposed dividend on equity shares @ Re.0.70 per share (2011: Re.0.60 per share) Dividend distribution tax payable on above Dividend Payable of Subsidiary @ Rs.10 per share (2011: Rs.10 per share) Dividend Distribution tax payable on above Total There are no arrears of dividend related to preference shares 23. Disclosure of dues/ payments to micro and small enterprises to the extent such enterprises are identified by the company. a) The principal amount remaining unpaid as at year end b) Interest due thereon remaining unpaid on year end c) The amount of interest paid by the buyer in terms of section 16 of the Micro, Small and Medium Enterprises Development Act, 2006, along with the amount of the payment made to the supplier beyond the appointed day during each accounting year d) Delayed payment of principal beyond the appointed date during the year e) Interest actually paid under section 16 of MSME Act, 2006 f) The amount of interest accrued and remaining unpaid on year end in respect of principal amount settled during the year g) The amount of further interest remaining due and payable even in the succeeding years, until such date when the interest dues as above are actually paid to the small enterprise, for the purpose of disallowance as a deductible expenditure under section 23 of the Micro, Small and Medium Enterprises Development Act, 2006 272 2 161 1 242 39 1,851 300 4 2 2,438 741 120 1,582 257 2 1 2,703
41 43
10 43
The information given above has been determined to the extent such parties have been identified by the Company, on the basis of information disclosed by the creditors, which has been relied upon by the auditors.
86

(All amounts in Rs.lacs, unless otherwise stated) Year ended March 31, 2012 24. REVENUE FROM OPERATIONS Sale of products Sale of services Other operating revenues Revenue from operations (gross) Less: Excise duty Revenue from operations (net) 25. OTHER INCOME Interest income Dividend income Net gain/(loss) on sale of assets/investments Liabilities no longer required written back Provision for doubtful debts, no longer required written back Provision for doubtful advances, no longer required written back Other non-operating income Total 26. COST OF MATERIALS CONSUMED Raw materials Opening stock Stocks received from amalgamated entity Purchases Closing stock Consumption Packing materials Opening stock Stocks received from amalgamated entity Purchases Closing stock Consumption Other manufacturing expenses Total 27. PURCHASES OF STOCK-IN-TRADE Finished goods Total 4,230 4,230 6,007 6,007 4,659 1,694 105,440 6,550 105,243 549 159,220 2,755 1,112 93,211 4,659 92,419 314 133,258 8,603 105 55,790 11,070 53,428 5,725 570 42,833 8,603 40,525 3,304 19 1 585 1,290 998 1,106 7,303 3,166 42 2 513 9 767 4,499 568,358 357 17,857 586,572 224,057 362,515 443,024 561 16,865 460,450 154,469 305,981 March 31, 2011
87

(All amounts in Rs.lacs, unless otherwise stated) Year ended March 31, 2012 March 31, 2011 28. CHANGES IN INVENTORIES OF FINISHED GOODS, WORK-IN-PROGRESS AND STOCK-IN-TRADE Stock at the end of the year: Finished goods Finished goods - Traded Work-in-progress Less: Stock at the beginning of the year: Finished goods Finished goods - Traded Work- in- progress Stock of amalgamated entities - Finished goods Stock of amalgamated entities - Work-in-progress (Increase)/decrease in stocks Excise duty movement on closing stock Total 29. EMPLOYEE BENEFITS EXPENSE Salaries, wages and bonus Gratuity Contribution to provident and other funds Welfare expenses Total
5,353 1 12,732 18,086 2,954 46 8,416 42 409 11,867 (6,219) 4,394 (1,825) 16,531 343 846 1,409 19,129
2,954 46 8,416 11,416 2,134 198 6,233 525 2,197 11,287 (129) 466 337 12,405 305 623 1,081 14,413
(i) Disclosures envisaged in AS 15 in respect of defined benefit plans (Grautity and Provident fund administered by a trust setup by the company) are given below: 2012 Gratuity Provident fund A) Reconciliation of opening and closing balances of the present value of the defined benefit obligation: Obligations at period beginning Obligation at period beginning from Amalgamation Service cost Interest cost Benefits settled Actuarial (gain)/loss Obligations at period end B) Change in plan assets Plan assets at period beginning, at fair value Plan assets at period beginning from Amalgamation Expected return on plan assets Actuarial gain/(loss) Contributions Benefits settled Plan assets at period end, at fair value 2011 2010 2009 2008 Gratuity
1,878 37 326 156 (158) (20) 2,219 1,639 37 128 (10) 20 (158) 1,656
3,434 680 284 (172) (4) 4,222 3,490 308 50 658 (172) 4,334
1,614 97 226 126 (234) 49 1,878 1,542 54 125 (13) 159 (228) 1,639
1,539 85 118 (125) (3) 1,614 1,331 102 (17) 251 (125) 1,542
1,426 130 96 (109) (4) 1,539 1,365 107 (76) 44 (109) 1,331
1,161 435 93 (260) (3) 1,426 1,161 93 108 263 (260) 1,365
88

(All amounts in Rs.lacs, unless otherwise stated) 2012 Gratuity Provident fund C) Reconciliation of present value of the obligation and the fair value of the plan assets Fair value of plan assets at the end of the year Present value of the defined benefit obligations at the end of the period Liability recognised in the balance sheet D) Expenses recognised in Statement of Profit and Loss Service cost Interest cost Expected return on plan assets Prior Period adjustment Actuarial (gain)/loss Total expenses recognised in Statement of Profit and Loss E) Major category of Plan Assets as a % of total Plan assets Government Securities Corporate Bonds Fund balance with insurance companies F) Description of the basis used to determine the overall expected rate of return on assets including major categories of plan assets The expected return is calculated on the average fund balance based on the mix of investments and the expected yield on them. Actual return on plan assets G) Assumptions Interest rate Discount factor Estimated rate of return on plan assets Salary increase Attrition rate Retirement age 115 8.50% 8.50% 8.00% 5.00% 1.00% 58 8.50% 8.50% 8.25% 5.00% 1.00% 58 112 8.00% 8.00% 8.00% 5.00% 1.00% 58 85 8.00% 8.00% 8.00% 5.00% 1.00% 58 31 7.00% 7.00% 8.00% 5.00% 1.00% 58 201 8.00% 8.00% 8.00% 5.00% 1.00% 58 100% 41% 59% 100% 100% 100% 100% 326 156 (128) (11) 343 680 285 (308) (54) 603 249 126 (125) 55 305 84 118 (102) 14 114 131 96 (107) 62 182 435 93 (93) (237) 62 260 1,656 2,219 (563) 4,334 4,222 112 1,639 1,878 (239) 1,542 1,614 (72) 1,331 1,539 (208) 1,365 1,426 (61) 2011 2010 2009 2008
Gratuity
The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand factors in the Employment market. As per the best estimate of management, Provident Fund contribution of Rs.875 (2011: Rs.850) and Gratuity contribution of Rs.400 (2011: Rs.350) is expected to be paid to the plans during the year ending March 31, 2013. (ii) Contribution to Provident and Other Funds (Note 29) includes Rs.1,189 (2011: Rs.928) being expenses debited under the following defined contribution plans Provident Fund Superannuation Fund and National Pension Scheme Total 600 229 829 458 165 623 360 131 491 282 109 391 288 94 382
89

(All amounts in Rs.lacs, unless otherwise stated) Year ended March 31, 2012 30. OTHER EXPENSES Power and fuel Rent Repairs to buildings Repairs to machinery* Repairs to others Insurance Rates and taxes Auditor remuneration As auditor For other services Sales promotion expenses Outward freight/halting/breakage expenses Selling & Distribution expenses Provision for doubtful debts Provision for doubtful advances Miscellaneous expenses Total 14,606 1,136 386 7,561 319 354 3,638 122 79 43 60,451 19,535 20,046 49 64 12,244 140,511 71 36 53,860 15,400 16,488 317 17 7,002 112,933 March 31, 2011 10,196 955 290 5,070 214 237 2,779 108
*Repairs to machinery includes stores and spares consumed of Rs.3,488 (2011: Rs.2,420) 31. FINANCE COSTS Interest expense Other borrowing costs Net gain/(loss) on foreign currency transactions and translation differences Total 32. CIF VALUE OF IMPORTS Raw materials Components and spares Capital goods Total 33. EXPENDITURE IN FOREIGN CURRENCY Foreign travel expenses of employees and others (net of recoveries) Technical services fees Selling and promotion expenses Interest and finance charges Others Total
9,370 480 40 9,890
7,316 264 213 7,793
3,879 127 4,593 8,599
2,727 53 533 3,313
103 654 1,897 701 86 3,441
102 600 1,180 588 26 2,496
90

(All amounts in Rs.lacs, unless otherwise stated) Year ended March 31, 2012 34. DETAILS OF CONSUMPTION AND PURCHASES a) Purchase of traded goods - Beer Opening stock Purchases during the year Sales during the year Closing stock b) Consumption of materials Malt Brewing materials Bottles Packing materials Other materials Total c) Value of imported and indigenous materials Value of imported raw materials consumed Value of indigenous raw materials consumed Value of imported packing materials and stores and spares consumed Value of indigenous packing materials and stores and spares consumed March 31, 2011
46 4,230 4,275 1
199 6,008 6,161 46
29,974 16,468 71,700 33,543 7,535 159,220 % Value in Rs. 5% 2,663 95% 51,921 1% 1,350 99% 107,930 % 6% 94% 2% 98% Year ended March 31, 2012
21,379 15,117 63,886 28,533 4,343 133,258 Value in Rs. 2,270 38,255 1,705 93,448
March 31, 2012 399 3 110,945,914 24,690,000 2009-10
35. DIVIDEND REMITTED IN FOREIGN EXCHANGE Dividend paid during the year Number of non resident shareholders Number of equity shares held by such non resident shareholders Number of preference shares held by such non resident shareholders Year to which dividend relates to 36. EARNINGS IN FOREIGN CURRENCY Services - Royalty 37. EARNINGS PER SHARE Profit after exceptional items & taxation as per Statement of Profit and Loss Less: Preference dividend (including dividend distribution tax thereon) Net profit attributable to equity shareholders Weighted average number of equity shares outstanding (Face value of Re.1 per share) Earnings per share (Basic / Diluted) *Includes 91,50,633 equity shares of Re.1 each pending allotment 12,677 281 12,396 264,405,149 4.69 14,749 861 13,888 263,695,571* 5.27 667 5 111,801,394 7,407,000 2010-11
149
199
91

(All amounts in Rs.lacs, unless otherwise stated) 38. AMALGAMATIONS I. 2011-12 A. The scheme of amalgamation under sections 391 to 394 of the Companies Act, 1956 between UB Ajanta Breweries Private Limited (UBA) and the Company (the Scheme) and their respective shareholders and creditors with April 1, 2011 as the appointed date has been approved by the Honorable BIFR court, Delhi vide their order dated February 13, 2012. Upon necessary filing with the Registrar of Companies on February 21, 2012, the scheme has become effective and the effect thereof has been given in these accounts. Consequently, In respect of the merger of UBA with the Company a) In terms of the scheme, the entire business and the whole of the undertaking of UBA, as a going concern stands transferred to and vested in the Company with effect from April 1, 2011, being the Merger Appointed Date. b) In consideration of the amalgamation of UBA with the company, the company has issued 709,578 equity shares of Re.1/- each aggregating to Rs.7 in the ratio of 135:1 c) Accounting for Amalgamation: The amalgamation of UBA with the Company is accounted for on the basis of the pooling of interest Method as envisaged in the Accounting Standard (AS)-14 on Accounting for Amalgamations specified in the Companies (Accounting Standard) Rules 2006 and in terms of the scheme, as below, All asset and liabilities of the UBA at their respective Book Values under the respective heads of the company. Rs.28 being the difference between the value of net assets of the UBA transferred to the Company (determined as stated above) and the carrying value of the Companys investment (cancelled as above) has been adjusted to Capital/General Reserve of the Company. The intercompany balances and the transactions stood cancelled UBA was engaged in brewing business. [The Authorised Share capital of the Company has been stand increased by Rs.540 of Equity Share Capital of Re.1/each and enhanced by Rs.9,460 of Rs.100/- each in Preference Share Capital. This increase is arising on account of amalgamation of UBA with United Breweries Limited.] B. UBL Benefit Trust Arising out of the Amalgamation of EBL into UBL [Refer II A(iii) below], UBL Benefit Trust held 6,007,413 equity shares in UBL constituting 2.36% of UBLs paid up equity capital. The Trust has sold its entire shareholding and remitted the entire proceeds aggregating Rs.28,357 to UBL. The entire proceeds has been used in reducing the Debt of the Company. In the absence of any specific accounting treatment being prescribed in the Accounting Standards notified pursuant to the Companies (Accounting Standards) Rules, 2006 as per Section 211(3C), the gain on sale of these shares held by UBL Benefit trust (of which the company is the sole beneficiary) aggregating to Rs.14,049 has been credited to the General Reserve. II. 2010-11 A. The scheme of amalgamation under sections 391 to 394 of the Companies Act, 1956 between Associated Breweries and Distilleries Limited (ABDL), Millennium Alcobev Private Limited (MAPL), Empee Breweries Limited (EBL) and the Company (the Scheme) and their respective shareholders and creditors with April 1, 2010 as the appointed date has been approved by the Honorable High Courts of Karnataka and Madras respectively vide their orders dated January 21, 2011 and February 1, 2011 respectively. Upon necessary filing with the Registrar of Companies on March 10, 2011, the scheme has become effective and the effect thereof has been given in these accounts. Consequently, i) In respect of the merger of ABDL with the Company a) In terms of the Scheme, the entire business and the whole of the undertaking of ABDL, as a going concern stands transferred to and vested in the Company with effect from April 1, 2010, being the Merger Appointed Date. b) As ABDL was a wholly owned subsidiary of the Company, no consideration was payable pursuant to amalgamation of ABDL.
92

(All amounts in Rs.lacs, unless otherwise stated) c) Accounting for Amalgamation: The amalgamation of ABDL with the Company is accounted for on the basis of the Purchase Method as envisaged in the Accounting Standard (AS)-14 on Accounting for Amalgamations specified in the Companies (Accounting Standard) Rules 2006 and in terms of the scheme, as below, All asset and liabilities of the ABDL at their respective Fair Values. Rs.44,986 being the difference between the value of net assets of the ABDL transferred to the Company (determined as stated above) and the carrying value of the Companys investment in MAPL (cancelled as above) has been adjusted to Capital/General Reserve of the Company. This accounting treatment of the reserve has been prescribed in the Scheme and approved by the High Court(s). Had the scheme not prescribed this treatment, this amount would have been debited to Goodwill, which would have been set-off against the Capital Reserve / General Reserve arising on the merger of other companies. ABDL was an investment company which was 100% subsidiary of the Company. ii) In respect of the merger of MAPL with the Company a) In terms of the Scheme the entire business and the whole of the undertaking of MAPL , as a going concern stands transferred to and vested in the Company with effect from April 1, 2010 being the Merger Appointed Date. b) In consideration of the amalgamation of MAPL with the Company, the Company has issued 8,489,270 equity shares of Re.1/- each aggregating to Rs.85 in the ratio of 6 fully paid up Equity shares of the face value of Re.1/- each of the Company for every 31 fully paid up equity shares of Rs.10/- each held in MAPL. The Companys investment in MAPL aggregating to Rs.5,895 comprising of 6,140,000 equity shares (with voting rights) and 6,599,312 equity shares (without voting rights) of Rs.10/- each stood cancelled. c) Accounting for Amalgamation: The amalgamation of MAPL with the Company is accounted for on the basis of the Purchase Method as envisaged in the Accounting Standard (AS)-14 on Accounting for Amalgamations specified in the Companies (Accounting Standard) Rules 2006 and in terms of the scheme, as below. All asset and liabilities of the MAPL were recorded at their respective Fair Values. Rs. 40,373 being the difference between the value of net assets of the MAPL transferred to the Company (determined as stated above) and the carrying value of the Companys investment in MAPL (cancelled as above) has been adjusted to Capital/General Reserve of the Company. This accounting treatment of the reserve has been prescribed in the Scheme and approved by the High Court(s). Had the scheme not prescribed this treatment, this amount would have been credited to Capital Reserve. MAPL was a Joint Venture between the Company and Scottish & Newcastle India Private Limited, which had 3 subsidiaries engaged in the brewing business. One subsidiary of MAPL, i.e. Empee Breweries Ltd., was also merged into UBL simultaneously along with MAPL. Subsequent to the merger of MAPL into UBL, the other 2 subsidiaries of MAPL, namely Millennium Beer Industries Limited (MBIL) and United Millennium Breweries Limited (UMBL) became the subsidiaries of the Company and all of them have been since amalgamated with the Company. iii) In respect of the merger of Empee Breweries Limited with the Company a) In terms of the Scheme, the entire business and the whole of the undertaking of EBL, as a going concern stands transferred to and vested in the Company with effect from April 1, 2010, being the Merger Appointed Date. b) On the amalgamation of EBL with the Company, 50% of the holding stood cancelled and for the balance 50% of the holding, the Company issued 6,007,413 equity shares of Re.1/- each aggregating to Rs.60 in the ratio of 33 fully paid up Equity shares of the face value of Re.1/- each of the Company for every 16 fully paid up equity shares of Rs.10/- of EBL to UBL Benefit Trust. UBL Benefit Trust has subsequent to the Balance Sheet date sold these shares and remitted the proceeds to the Company. c) Accounting for Amalgamation: The amalgamation of EBL with the Company is accounted for on the basis of the Pooling of Interest Method as envisaged in the Accounting Standard (AS)-14 on Accounting for Amalgamations specified in the Companies (Accounting Standard) Rules 2006 and in terms of the scheme, as below,
93

(All amounts in Rs.lacs, unless otherwise stated) All asset and liabilities of the EBL were recorded at their respective book values under the respective accounting heads of the Company. Rs.13,645 being the difference between the value of net assets of the EBL transferred to the Company (determined as stated above) and the carrying value of the Companys investment has been adjusted to Capital/General Reserve of the Company. The Shares issued to UBL Benefit Trust appears as a separate line item in the Balance Sheet of the Company as Interest in UBL Benefit Trust. The inter company balances and transactions stood cancelled. EBL was engaged in the brewing business. B. The scheme of amalgamation under sections 391 to 394 of the Companies Act, 1956 between UB Nizam Breweries Private Limited (UBNPL) and the Company (the Scheme) and their respective shareholders and creditors, with April 1, 2010 as the appointed date, has been approved by the Honorable High Court of Karnataka vide its order dated August 26, 2011. Upon necessary filing with the Registrar of Companies, the scheme has become effective on November 8, 2011 and the effect thereof has been given in these accounts. Consequently, In respect of the merger of UB Nizam Breweries Private Limited (UBNPL) with the Company a) In terms of the Scheme, the entire business and the whole of the undertaking of UBNPL, as a going concern stands transferred to and vested in the Company with effect from April 1, 2010, being the Merger Appointed Date. b) In consideration of the amalgamation of UBNPL with the Company, the Company had issued 145,902 equity shares of Re.1/- each aggregating to Re.1/- in the ratio of 1 fully paid up Equity shares of the face value of Re.1/- each of the Company for every 454 fully paid up equity shares of Rs.10/- each held in UBNPL and in the ratio of 1 fully paid up Equity Shares of the face value of Re.1/- each of the Company for every 454 fully paid preference shares of Rs.10/- each in UBNPL. c) Accounting for Amalgamation: The amalgamation of UBNPL with the Company is accounted for on the basis of the Pooling of Interest Method as envisaged in the Accounting Standard (AS)-14 on Accounting for Amalgamations specified in the Companies (Accounting Standard) Rules 2006 and in terms of the scheme, as below, All asset and liabilities of UBNPL were recorded at their respective book values under the respective accounting heads of the Company. Rs.488 being the difference between the value of net assets of UBNPL transferred to the Company (determined as stated above) and the carrying value of the Companys investment has been adjusted to Capital/General Reserve of the Company. The inter company balances and the transactions stood cancelled. UBNPL was engaged in the brewing business. C. The scheme of amalgamation under sections 391 to 394 of the Companies Act, 1956 between Chennai Breweries Private Limited (CBPL) and the Company (the Scheme) and their respective shareholders and creditors with March 31, 2011 as the appointed date has been approved by the Honorable High Court of Karnataka and Honorable High Court of Madras, vide its order dated August 26, 2011 and October 11, 2011 respectively. Upon necessary filing with the Registrar of Companies, the scheme has become effective on November 12, 2011 and the effect thereof has been given in these accounts. Consequently, in respect of the merger of Chennai Breweries Private Limited (CBPL) with the Company a) In terms of the Scheme, the entire business and the whole of the undertaking of CBPL, as a going concern stands transferred to and vested in the Company with effect from the closing hours of March 31, 2011, being the Merger Appointed Date. b) In consideration of the amalgamation of CBPL with the Company, the Company has issued 8,500,000 equity shares of Re.1/- each aggregating to Rs.85 in the ratio of 17 fully paid up Equity shares of the face value of Re.1/- each of the Company for every 30 fully paid up equity shares of Rs.10/- each held in CBPL which is pending allotment.
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(All amounts in Rs.lacs, unless otherwise stated) c) Accounting for Amalgamation: The amalgamation of CBPL with the Company is accounted for on the basis of the Pooling of Interest Method as envisaged in the Accounting Standard (AS) -14 on Accounting for Amalgamations specified in the Companies (Accounting Standard) Rules 2006 and in terms of the scheme, as below, All asset and liabilities of CBPL were recorded at their respective book values under the respective accounting heads of the Company. Rs.1,645 being the difference between the value of net assets of CBPL transferred to the Company (determined as stated above) and the carrying value of the Companys investment has been adjusted to Capital/General Reserve of the Company. The inter company balances stood cancelled. CBPL was engaged in the brewing business. D. The scheme of amalgamation between Millennium Beer Industries Limited (MBIL) and the Company (the Scheme) and their respective shareholders and creditors with April 1, 2010 as the appointed date has been approved by the Honorable BIFR Court, Delhi vide its order dated November 11, 2011. Upon necessary filing with the Registrar of Companies, the scheme has become effective on November 16, 2011 and the effect thereof has been given in these accounts. Consequently, in respect of the merger of Millennium Beer Industries Limited (MBIL) with the Company a) In terms of the Scheme, approved by the BIFR Court, the entire business and the whole of the undertaking of MBIL, as a going concern stands transferred to and vested in the Company with effect from April 1, 2010, being the Merger Appointed Date. b) On the amalgamation of MBIL with the Company, the Companys holding stands cancelled and for the rest the Company has issued 504,731 equity shares of Re.1/- each aggregating to Rs.5 in the ratio of 1 fully paid up Equity shares of the face value of Re.1/- each of the Company for every 12 fully paid up equity shares of Re.1/- of MBIL allotment. c) Accounting for Amalgamation: The amalgamation of MBIL with the Company is accounted for on the basis of the Pooling of Interest Method as envisaged in the Accounting Standard (AS) -14 on Accounting for Amalgamations specified in the Companies (Accounting Standard) Rules 2006 and in terms of the scheme, as below, All asset and liabilities of MBIL were recorded at their respective book values under the respective accounting heads of the Company. Rs.30,514 being the difference between the value of net assets of MBIL transferred to the Company (determined as stated above) and the carrying value of the Companys investment has been adjusted to Capital/General Reserve of the Company. The inter company balances and transactions stood cancelled. MBIL was engaged in the brewing business. E. The scheme of amalgamation between United Millennium Breweries Limited (UMBL) and the Company (the Scheme) and their respective shareholder and creditors with April 1, 2010 as the appointed date has been approved by the Honorable BIFR Court, Delhi vide its order dated November 21, 2011. Upon necessary filing with the Registrar of Companies, the scheme has become effective on November 21, 2011 and the effect there of have been given in these accounts. Consequently, in respect of the merger of United Millennium Breweries Limited (UMBL) with the Company. a) In terms of the Scheme approved by the BIFR Court, the entire business and the whole of the undertaking of UMBL, as a going concern stands transferred to and vested in the Company with effect from April 1, 2010 being the Merger Appointed Date. b) As UMBL was a wholly owned subsidiary of the Company, no consideration was payable pursuant to amalgamation of UMBL with the Company. c) Accounting for Amalgamation: The amalgamation of UMBL with the Company is accounted for on the basis of the Pooling of Interest Method as envisaged in the Accounting Standard (AS) -14 on Accounting for Amalgamations specified in the Companies (Accounting Standard) Rules 2006 and in terms of the scheme, as below,
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(All amounts in Rs.lacs, unless otherwise stated) All asset and liabilities of UMBL were recorded at their respective book values under the respective accounting heads of the Company. Rs.4,668 being the difference between the value of net assets of UMBL transferred to the Company (determined as stated above) and the carrying value of the Companys investment has been adjusted to Capital/General Reserve of the Company. The inter company balances and transactions stood cancelled. UMBL was engaged in the brewing business. Pursuant to all the schemes referred to in A to E above, the bank accounts, agreements, licences and certain immovable properties of the transferor companies are in the process of being transferred in the name of the Company. Pursuant to the schemes referred to in II A to E above, the Authorized Share Capital of the Company stands increased and reclassified, without any further act or deed on the part of the company, including payment of stamp duty and Registrar of Companies fees, by Rs.57,340 comprising of 3,320,000,000 Equity Shares of Re.1 each and 24,140,000 Preference Shares of Rs.100 each, being the authorized share capital of the transferor company, and Memorandum of Association and Articles of Association of the Company stand amended accordingly without any further act or deed on the part of the company. The Summary of additions/(deletions) to/(from)of Capital Reserve/General Reserve arising out each of the amalgamating entities is given below: General Reserve Expenses relating to mergers Arising on amalgamating ABDL Arising on amalgamating MAPL Arising on amalgamating EBL Arising on amalgamating UBN Arising on amalgamating CBPL Arising on amalgamating MBIL Arising on amalgamating UMBL DTA arising on amalgamation Total Resultant capital reserve on amalgamation 127 (6,134) 230 (21,397) (2,778) 8,387 (21,565) Capital Reserve (358) (450) 40,373 (13,772) 6,623 1,415 (9,118) (1,890) 22,823 1,258
The shares outstanding to be issued in respect of amalgamation of UBNPL, CBPL and MBIL were disclosed as share capital pending allotment in the financial statements for the year ended March 31, 2011 pending completion of allotment formalities. These shares have been alloted during the year ended March 31, 2012. III. Subsequent to the amalgamation of UBNPL, EBL, CBPL, UBAPL, UMBL and MBIL with the Company as indicated above, the Company has initiated the process of obtaining its name recorded in the state excise records and with other regulatory authorities in place of UBNPL, EBL, CBPL, UBAPL, UMBL and MBIL. Pending completion of these formalities, the name of UBNPL, EBL, CBPL, UBAPL, UMBL and MBIL are continued to be used in various documents, records, invoices and vouchers etc. IV. On February 17, 2012, the Company has obtained Board approval for amalgamation of Scottish & Newcastle India Private Limited with an appointed date of April 1, 2012. Applications have been filed with Honourable High Court of Karnataka for necessary approvals.
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(All amounts in Rs.lacs, unless otherwise stated) 39. RELATED PARTY DISCLOSURES A. Related parties with whom transactions have talen place during the year Associate: Entity which has significant influence: Others: United East Bengal Football Team Private Limited (UEBFTPL) a) Scottish & Newcastle India Limited (SNIL) b) United Breweries (Holdings) Limited (UBHL) a) Scottish & Newcastle Limited (S&N) b) Heineken UK Limited, holding company of SNIL and subsidiary of Scottish & Newcastle Limited c) Scottish & Newcastle UK Limited (SNUK), subsidiary of Scottish & Newcastle Limited d) Scottish & Newcastle India Private Limited (SNIPL), subsidiary of Heineken UK Limited e) Heineken International B.V. f) Heineken Romania S.A. g) Heineken Brouwerijen B.V. h) Heineken Supply Chain B.V. i) Force India F1 Team Limited (Force India) Mr. Kalyan Ganguly Mr. Guido de Boer Mrs. Suparna Bakshi Ganguly (Wife of Mr. Kalyan Ganguly)
Key Management Personnel (KMP): Relative of KMP
B. Transactions with related parties during the year: UEBFTPL 2012 Sale of goods [including sales taxes / VAT] Sponsorship and other payments Lease rentals Royalty on logo Payments (for supplies including loan in cash or kind)# Remuneration to Directors* Amount due from/(to) 911 911 (18) 2011 503 503 (18) UBHL 2012 1,187 15 61 662 (608) 104 2011 961 6 64 662 (255) 263 FORCE INDIA 2012 1,376 462 2011 973 1,171 914 894 581 KMP 2012 2011
*Kalyan Ganguly: Rs.670 (2011: Rs.415), Guido de Boer: Rs.224 (2011: Rs.166) #Figures in brackets indicate amounts received C. Transactions with Heineken Group (1) Transactions with SNIL Balance of preference share capital Dividend on above Redemption of preference share capital Final dividend on equity shares (2) Transaction with Heineken UK Ltd. Purchase of raw material Reimbursements Rs. 7,407 (2011: Rs.24,690) Rs. 242 (2011: Rs.741) Rs.17,283 (2011: Rs.NIL) Rs. 630 (2011: Rs.399) Rs.2 (2011: Rs.7) Rs.2 (2011: Rs.1)
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(All amounts in Rs.lacs, unless otherwise stated) (3) Transaction with Heineken Romania S.A. Mould development charges (4) Transaction with Heineken Brouwerijen B.V. Technical services fee Sales promotion (5) Transaction with Heineken International B.V. Reimbursements Final dividend on equity shares (6) Transaction with Heineken Supply Chain B.V. Consultancy fee 40. OPERATING LEASE The Company has entered into leasing arrangements for vehicles, computers, equipments, office premises and residential premises that are renewable on a periodic basis, and cancellable/ non-cancellable in nature. Such leases are generally for a period of 11 to 60 months with options of renewal against increased rent and premature termination of agreement through notice period of 2 to 3 months, except in the case of certain leases where there is a lock-in period of 11 to 26 months. Year ended March 31, 2012 Lease payments during the year At the balance sheet date, future minimum lease rentals under non-cancellable operating leases are as under: Not later than one year One to five years Total 41. DETAILS OF SUBSIDIARY/ASSOCIATE The Consolidated Financial Statement (CFS) presents the consolidated accounts of United Breweries Limited (the Company) with its following Subsidiaries ('UBL Group' or 'Group'). Ownership % 2012 Name of the Subsidiary Maltex Malsters Limited (MML) 51 51 India 2011 Country of Incorporation 173 108 281 196 269 465 1,136 March 31, 2011 1,014 Rs.NIL (2011: Rs.1) Rs.600 (2011: Rs.600) Rs.2 (2011: Rs.NIL) Rs.66 (2011: Rs.56) Rs.3 (2011: Rs.NIL) Rs.54 (2011: Rs.17)
The Companys interest in United East Bengal Football Team Private Limited (UEBFTPL), and associate of the Company has not been included in consolidation as the same is not considered material. 42. GOODWILL ON CONSOLIDATION The group evaluates the carrying value of its Goodwill whenever events or changes in circumstances indicate that its carrying value may be impaired for diminution, other than temporary. The group has currently reassessed the circumstances that could indicate the carrying amount of Goodwill may be impaired. Accordingly, the investment in Maltex Malsters Limited (MML) which had a carrying value of Rs.4,500 has been revalued at Rs.2,541 and the differential amount adjusted against goodwill arising on consolidation. The dimunition in value of this investment has been due to continued delays in obtaining necessary approvals to expand its malting facility at Patiala. Considering the constraints in MMLs expansion plans and high overhead costs incurred on operating assets current level of capacity, it has been decided to value the investments based on the fair value of net assets of MML.
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(All amounts in Rs.lacs, unless otherwise stated) 43. ACQUISITION OF MALTEX MALSTERS LIMITED During the financial year ended March 31, 2008 the Company has acquired 22,950 equity shares of Rs.100 each in Maltex Malsters Limited for a consideration of Rs.4,500 which is based on an independent valuation, resulting in a goodwill of Rs.4,380 as detailed below.
Rs. Fixed Assets (Net book value) Deferred Tax Assets Current Assets Sundry Debtors Cash & Bank Balances Loans & Advances Total Current Liabilities and Provision Current Liabilities Provisions Total Net Current Asset Loans Secured Loans Unsecured Loans Net Worth as on March 31, 2008 UBL's Share -51% Purchase Consideration Goodwill Minority Interest 189 7 196 236 120 4,500 4,380 115 81 2 83 166 132 1 116 249 Rs. 240 26
44. ADVANCE MADE TO STAR INVESTMENTS The Company had entered into an agreement with the promoters of Balaji Distilleries Limited (BDL) with a view to secure perpetual usage of its brewery and grant of first right of refusal in case of sale or disposal of its brewery unit in any manner by BDL, towards which the Company had made a refundable facility advance of Rs.15,500 to Star Investments Private Ltd. (Star Investments), one of the Promoter Companies of BDL, acting for itself and on behalf of the other Promoters. Subsequently, BDL filed a scheme of arrangement for amalgamation of its distillery into United Spirits Limited (USL) and de-merger of its brewery into Chennai Breweries Private Limited (CBPL) and the said Scheme was approved by Appellate Authority for Industrial & Financial Reconstruction in November 2010.The Brewery assets proposed to be acquired by the Company from the Promoters of BDL eventually vested in CBPL which was a 100% subsidiary of USL. A Scheme for amalgamation of CBPL into the Company was then filed. Upon amalgamation of CBPL into the Company, USL has been allotted equity shares in terms of the approved Scheme. On November 22, 2011, the Company has entered into an agreement extending the repayment of principal and interest outstanding till March 2012, and obtained a pledge of securities from associate companies of Star to secure the outstanding amounts. Commitment has been received from M/s Star Investments for accruing of interest on the outstanding till the same is fully repaid. The company has received payments of Rs.2,980 towards interest after the repayment date and the aggregate amount due as on March 31, 2012 is Rs.21,196. The Company continued to receive interest and TDS payments to the tune of Rs.11,190 after March 31, 2012 till date.
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(All amounts in Rs.lacs, unless otherwise stated) 45. DERIVATIVE INSTRUMENTS Particulars a) Derivatives outstanding as at reporting date Forward contracts to buy USD Forward contracts to buy USD Forward contracts to buy USD Forward contracts to buy USD b) Mark to market losses Mark to market gains (net) not recognised 46. SEGMENT REPORTING The company is engaged in manufacture, purchase and sale of beer including licensing of brands which constitutes a single business segment. The company operates only in India. Accordinlgy, primary and secondary reporting disclosures for business and geographical segment as envisaged in AS-17 are not applicable to the company. 47. PREVIOUS YEAR FIGURES a) The previous years figures have been regrouped to conform to current years classification. Further in view of the amalgamations described in Note 38 above, the figures for the current year are not comparable with those of previous year. b) The financial statements for year ended March 31, 2011 had been prepared as per the then applicable, prerevised Schedule VI to the Companies Act, 1956. Consequent to the notification of Revised Schedule VI under the Companies Act, 1956, the financial statements for the year ended March 31, 2012 are prepared as per Revised Schedule VI. Accordingly, the previous year figures have also been reclassified to conform to this year's classification. The adoption of Revised Schedule VI for the previous year figures does not impact recognition and measurement principles followed for preparation of financial statements. For Price Waterhouse Firm Registration Number: 007568 S Chartered Accountants Usha A Narayanan Partner Membership No. -23997 Bangalore, June 8, 2012 Kalyan Ganguly Managing Director Govind Iyengar Senior Vice PresidentLegal & Company Secretary Bangalore, June 8, 2012 Guido de Boer Director, CFO 212 Hedge of External commercial borrowings Hedge of External commercial borrowings Hedge of External commercial borrowings Hedge of Foreign currency loan USD 20 Million, Rs.52.70 USD 50 Million, Rs.49.285 USD 1.38 Million, Rs.45.06 USD 10 Million, Rs.46.56 USD 6.94 Million, Rs.45.06 Purpose As at March 31, 2012 As at March 31, 2011
100
SUMMARISED FINANCIALS OF SUBSIDIARY COMPANY AS REQUIRED IN TERMS OF GENERAL EXEMPTION GRANTED UNDER SECTION 212(8) OF THE COMPANIES ACT, 1956, BY THE GOVERNMENT OF INDIA, MINSTRY OF CORPORATE AFFAIRS, VIDE GENERAL CIRCULAR NO. 2/2011, DATED 8TH FEBRUARY 2011 Rs. in lacs Reserves & Surplus 244 467 467 930 47 15 32 Total Assets Total Liabilities Investments Profit & Loss Account Debit Balance Turnover Profit before Taxation Provision for Taxation Profit after Taxation Proposed Dividend 10
Sl. No. 45
Name of the Subsidiary
Issued & Subscribed Share Capital
Maltex Malsters Limited
Note: The Annual Report along with related information of the subsidiary company shall be made available for investors of the Company and its subsidiary seeking the Report / information at any point of time. The Annual Report is also available for inspection of investors at the Registered Office of the Companies.
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Notes:
102
Joseph Noronha

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CONTENTS

Chairmans Statement (contd.)

VIJAY MALLYA CHAIRMAN

Report of the Directors

Report of the Directors (contd.)

Report of the Directors (contd.)

Report of the Directors (contd.)

Report of the Directors (contd.)

Report of the Directors (contd.)

Report of the Directors (contd.)

Contract Farming 5000 farmers Generate livelihood through empowerment of farmers

Report of the Directors (contd.)

Report of the Directors (contd.)

Report of the Directors (contd.)

June 08, 2012 Bangalore

Kalyan Ganguly Managing Director

Guido de Boer Director, CFO

Annexure to Directors Report

Annexure to Directors Report (contd.)

Samar Singh Sheikhawat

10 Govind Iyengar 11 Govind Tiwari

SVP - Legal & Secretarial DVP - UBL Goa

12 R K Jindal 13 R Santosh Kumar

By Authority of the Board,

June 08, 2012 Bangalore

Kalyan Ganguly Managing Director

Guido de Boer Director, CFO

Report on Corporate Governance

Report on Corporate Governance (contd.)

Names of the Directors

Report on Corporate Governance (contd.)

Report on Corporate Governance (contd.)

Report on Corporate Governance (contd.)

Report on Corporate Governance (contd.)

Report on Corporate Governance (contd.)

Report on Corporate Governance (contd.)

December 21, 2011

August 20, 2010

September 10, 2009

Report on Corporate Governance (contd.)

Report on Corporate Governance (contd.)

Report on Corporate Governance (contd.)

Comparison - UBL Stock Price Vs. BSE Sensex

350 17705.01 17752.68 17404.20 250

16676.75 15000 Apr-11 May-11 Jun-11

UBL Closing Price (Rs.) (Equity Shares of Re.1)

Report on Corporate Governance (contd.)

5500 5000 4500 4000

Apr-11 May-11 Jun-11

UBL Closing Price (Rs.) Equity Shares of Re.1

Report on Corporate Governance (contd.)

Report on Corporate Governance (contd.)

74.82% (Promoter & Group)

1.97% (Physical mode)

(Electronic mode) 98.03%

Report on Corporate Governance (contd.)

Report on Corporate Governance (contd.)

Place: Bangalore Date: June 08, 2012

Kalyan Ganguly Managing Director