Godrej Consumer Products FY14: Higher free cash flows in FY14, backed by improvement in working capital and lower capex.

5 January 2015

GODREJ CONSUMER PRODUCTS FY14

The analysis of Godrej Consumer Products’ (GCPL) latest annual

report highlights higher free cash flows in FY14, backed by

improvement in working capital and lower capex. Further, GCPL has

cumulatively adjusted INR1.2b (11.7% of FY14 PBT) directly against

reserves. Excise and VAT receivables, forming part of loans and

advances, appear high at INR1.5b (5% of FY14 net worth) when

compared with peers due to slower receipt of refund of statutory

receivables by manufacturing units located in north-eastern states.

Free cash flows improved due to lower working capital

requirement and capex:

Consolidated operating cash flows grew

from INR8.2b in FY13 to INR11.3b in FY14 due to higher EBITDA

and lower working capital requirement. Working capital

requirement was lower, as cash conversion cycle improved from

35 days in FY13 to 27 days in FY14. Further, capex of INR6.5b

(FY13: INR9.5b) resulted in positive free cash flows.



Cumulative expenses of INR1.2b (11.7% of FY14 PBT) adjusted

through reserves:

In FY14, GCPL cumulatively adjusted revenue

expenses of INR1.2b (11.7% of PBT) directly through reserves on

account of the following:

1) In accordance with the scheme of amalgamation, trademarks

and brands for

HIT

and

Good Knight

are being amortized

over 20 years through reserves, with annual amortization of

INR527.5m (5.1% of PBT). Under IFRS, these brands are not

amortized and are merely tested for impairment.

2) Premium on redemption of debentures of INR245m (2.4% of

PBT) has been adjusted as permitted by the Companies Act.

3) On merger of wholly-owned subsidiaries, an amount of

INR434.5m (4.2% of PBT) was adjusted through reserves on

consolidation of financial statements.



Loans to ESOP trust w/off earlier; now recognized on recovery

of loan:

During 1HFY15, GCPL recovered loans to ESOP Trust of

INR252.5m (4.8% of 1HFY15 PBT), which was earlier written-off

through reserves in FY11, in accordance with the scheme of

amalgamation. This was now recognized through P&L in 1HFY15.



Excise and VAT receivables higher than peers:

GCPL’s excise and

VAT receivables were INR1.5b (FY13: INR1.2b), 5% of FY14 net

worth (FY13: 4.7%). The receivables are high when compared to

peers due to delay in receipt of refund of excise duties from units

located in north-eastern states.



NNUAL

EPORT

HREADBARE

The

ART

of annual report analysis



Cumulative expenses of

INR1.2b (11.7% of FY14

PBT) adjusted through

reserves



Loans to ESOP trust w/off

earlier; now recognized

on recovery of loan



Excise and VAT receivables higher than

peers

Stock Info

Bloomberg

CMP (INR)

Equity Shares (m)

52-Week Range (INR)

M.Cap. (INR b)/(USD b)

1,6,12 Rel. Perf. (%)

GCPL IN

968

340.3

1,118/672

327.0/5.2

-1/12/16

2016E

100.3

17.1

11.8

34.7

30.5

157.8

22.0

25.1

28.9

27.9

6.1

2017E

116.5

20.2

14.0

41.2

19.0

188.5

21.9

25.8

24.2

23.5

5.1

Financial summary (INR b)

Y/E Mar

Sales

EBITDA

Adj. PAT

Adj. EPS (INR)

EPS Gr. (%)

BV/Sh.(INR)

RoE (%)

RoCE (%)

Payout (%)

P/E (x)

P/BV (x)

E: MOSL Estimates

As on

Promoter

DII

FII

Others

2015E

85.3

13.4

9.0

26.6

22.6

133.5

19.9

22.1

37.7

36.4

7.3

Shareholding pattern (%)

Sep-14

63.3

1.8

29.0

5.9

Jun-14

63.3

1.8

28.5

6.5

Sep-13Rs

63.3

1.2

28.7

6.8

Note: FII Includes depository receipts

Auditor’s name

Kalyaniwalla & Mistry, Chartered Accountants

ART will present a threadbare portrait of annual reports - statistical, strategic and structured. We believe ART's wide canvas - from accounting and auditing issues to

operating performance to management insights to governance matters - will help readers paint a clearer picture of the stock's investment worthiness.

Ashish Gupta

(Ashish.Gupta@MotilalOswal.com); +91 22 3982 5544

Piyush Chaplot

(Piyush.Chaplot@MotilalOswal.com); +91 22 3312 4975

Investors are advised to refer through disclosures made at the end of the Research Report.

ART|

Godrej Consumer Products FY14

ART #1

Redemption premium on

NCDs (finance cost) of

INR129m in 1HFY15 (2.5%

of PBT) adjusted directly

against reserves

ACCOUNTING/AUDITING OBSERVATIONS

Redemption premium of INR245m on NCDs adjusted through reserves



GCPL has a policy of adjusting the premium on redemption of debentures

directly through reserves (Securities Premium), as permitted under the

Companies Act, 1956.

In FY14, it adjusted premium of INR245m (2.4% of PBT) on redemption of

debentures (FY13: INR248m) through securities premium instead of routing this

through the P&L account.

Exhibit 1: Premium on redemption of debentures routed through reserves instead

of P&L (INR m)

Premium on redemption of debenture

3.5%

231

272

248

245

% of PBT

2.8%

2.4%

129

2.5%

FY11

FY12

FY13

FY14

1HFY15

Source: Company Annual Report, MOSL

Amortization of HIT and Goodnight trademark/brands through reserves



Amortization of INR265m

(5% of 1HFY15 PBT) routed

through reserves every year

for amortization of

Good

Knight

and

HIT

brand



Trademarks and brands for

HIT

and

Good Knight,

acquired under a scheme of

amalgamation with GHPL, are being amortized over 20 years directly through

reserves. GCPL amortizes INR527.5m (5.1% of FY14 PBT) directly through

general reserves every year instead of P&L, in accordance with the High Court

scheme approval.

Under IFRS, these brands are not amortized and are merely tested for

impairment. The Finance Minister in his Budget speech for 2014 had announced

that IFRS will be mandatory for Indian companies from FY17.

GCPL amortizes its other trademarks/brands over a period of 10 years through

the P&L, except

Kinky

and

Soft & Gentle,

which are amortized over a period of

20 years.

Exhibit 2: Amortization of trademarks/brands for HIT and Good Knight through reserves

continued (INR m)

Trademark and brand amortisation

13.8%

% of PBT

5.4%

902

FY11

528

FY12

5.1%

528

FY13

5.1%

5.0%

528

FY14

265

1HFY15

Source: Company Annual Report, MOSL

5 January 2015

ART

Godrej Consumer Products FY14

Adjustments of ~4% of PBT on amalgamation of wholly-owned subsidiaries

charged through reserves

Forex revaluation loss of

subsidiaries of INR434.5m

(4.2% of FY14 PBT) adjusted

against reserves on merger

of subsidiaries



During FY14, pursuant to a scheme of amalgamation, Godrej Indonesia

Netherlands Holding BV (GINH) was merged with Godrej Consumer Holding

(Netherlands) BV (GCHN) from September 30, 2013.

In accordance with the scheme, aggregate of forex revaluation losses of

subsidiaries of GCHN and cost and expenses of amalgamation of USD7.8m

(INR395.3m; 3.8% of FY14 PBT) were adjusted through reserves on consolidation

of financial statements.

In another scheme of amalgamation, Godrej Hygiene Products (GPH) was

merged with the company from September 7, 2013. The appointed date of

merger was April 1, 2013. The merger resulted in INR39.2m (0.4% of PBT) being

adjusted through general reserves (including amalgamation expense of

INR3.7m).

Exhibit 3: Adjustment of 11.7% of PBT through reserves primarily due to amalgamation

schemes

Particulars

INR m

Amortization of HIT and Good Knight brands

527.5

Premium on redemption of debentures

245.0

Adj on amalgamation of wholly-owned subsidiaries through reserves

434.5

Total

1,207.0

Adj as % of PBT (%)

11.7

Source: Company Annual Report, MOSL

Exhibit 4: Revenue expenses adjusted through reserves every year (INR m)

Particulars

Opening net worth

Add: Profit for the year

Less: Dividend (including tax)

Add/(Less): Adjustments

Preferential allotment of shares

Premium on redemption of debentures

Trademarks and brands amortization pursuant to scheme

of amalgamation of GHPL

Adjustments pursuant to schemes of amalgamation of

wholly-owned subsidiaries

Foreign currency impact on translation of foreign

subsidiaries

Other adjustments

Closing net worth

FY12

17,252

7,267

-1,820

6,850

-272

-528

-378

-225

FY13

28,040

7,961

-1,983

-248

-528

-207

FY14

33,130

7,597

-2,091

-245

-528

-435

245

-105

28,040

33,130

37,754

Source: Company Annual Report, MOSL

5 January 2015

ART

Godrej Consumer Products FY14

Loans to ESOP trust w/off earlier through reserves; now recognized in P&L

on recovery of loan

Recovery of previously

written-off loan to ESOP

Trust of INR253m

recognized as income in

P&L in FY15. However

earlier this was adjusted

through reserves



GCPL operates two ESOP schemes – one for GCPL employees (named GCPL ESOP

Plan) and other for employees of erstwhile Godrej Household Products (GHPL)

(named Godrej SaraLee ESOP Plan wherein Godrej Industries shares are issued).

Further, the company had also launched the Employees Stock Grant Scheme

(ESGS) in 2011, wherein exercise price of shares is fixed at INR1 (face value).

Under the first two ESOP schemes, the company gave loans to ESOP trust for

purchase of shares from the secondary market. The loan was repaid on exercise

of options by the employees along with interest at a rate not less than the

prevailing bank rate.

During FY11, on account of non-recovery of loan to ESOP trust on Godrej

SaraLee ESOP Plan, the company had written-off INR295.5m through reserves in

accordance with the scheme of amalgamation.

During FY15, the company altered the Godrej SaraLee ESOP Plan by issuing

shares of GCPL instead of GIL. Accordingly, the company recovered INR253m in

1HFY15 (4.8% of 1HFY15 PBT) from the ESOP Trust on exercise of shares by the

employees. This receipt has been recognized as other income through P&L in

1HFY15.

Exhibit 5: One-time income of INR253m recognized in P&L on recovery of past written-off

loan to ESOP Trust (INR m)

Particulars

Opening balance of loan to GCPL ESOP Trust

Opening balance of loan to Godrej Saralee

(GIL) ESOP Trust

Additional loan / (repayments)

Interest accrued

Merger w/off through reserves

Closing balance of loan to ESOP Trust

Income booked on recovery of loan

FY11

638

594

-51

157

-296

1,042

FY12

1,042

FY13

875

FY14

503

1HFY15

-292

-426

-508

-253

125

875

503

253

Source: Company Annual Report, MOSL

Consolidated tax rate higher in FY14; lower tax rate in FY13 due to tax

benefit on sale of Indonesian food business

GCPL’s consolidated tax

rate increased to 20% in

FY14 from 17% in FY13;

which is likely to be the

normative tax rate



GCPL’s consolidated tax rate increased from 17% in FY13 to 20% in FY14. The

increase in tax rate was both at the standalone and subsidiaries level. While

standalone tax rate increased to 21% in FY14 from 19% in FY13, subsidiaries’

(derived) tax rate jumped to 20% in FY14 from 15% in FY13.

Indovest Capital, a subsidiary incorporated in Labuan, Malaysia owns the

trademarks for brands sold in Indonesia. GCPL’s Indonesian subsidiaries are

subject to a tax rate of 30%, while Indovest is a tax-free entity. Indonesian

subsidiaries pay royalty @ ~2% of turnover to Indovest Capital, resulting in tax

savings to the extent of royalty payment.

In January 2013, GCPL had sold its non-core food business (Simba) in Indonesia

with the associated brands for USD35m. The subsidiaries (derived) tax rate was

lower in FY13 due to 0% tax on sale of food (Simba) business since the brands

were domiciled in Indovest Capital.

5 January 2015

ART

Godrej Consumer Products FY14

Exhibit 6: Subsidiaries (derived) FY13 tax rate was lower due to 0% tax on sale of food (Simba) business;

normative tax rate in FY14 (INR m)

Particulars

Profit before tax (A)

Tax expense (B)

- Current tax

- Deferred tax (net)

Effective tax rate (B/A)

FY13

6,330

1,220

1,283

-63

19%

Standalone

FY14

7,130

1,482

1,511

-30

21%

1HFY15

3,714

768

21%

Subsidiaries (derived)

FY13

FY14

1HFY15

3,917

3,167

1,544

572

622

393

636

656

-64

-34

15%

20%

25%

Consolidated

FY13

FY14

1HFY15

10,246

10,297

5,258

1,792

2,104

1,161

1,919

2,167

-127

-63

17%

20%

22%

Source: Company Annual Report, MOSL

Exhibit 7: Royalty higher in FY13 due to sale of brand of Indonesian food business

Royalty (INR m)

Royalty as % of Indonesia turnover (%)

7.5

1.7

193

FY11

1.8

304

FY12

1,691

FY13

1.3

330

FY14

Source: Company Annual Report, MOSL

5 January 2015

ART

Godrej Consumer Products FY14

ART #2

KEY FINANCIAL INSIGHTS

Positive free cash flows driven by lower working capital and capex

Cash conversion cycle

improved due to higher

payables and lower

inventory days



Operating cash flows increased from INR8.2b in FY13 to INR11.3b in FY14, led by

higher EBITDA and lower working capital requirement at both standalone and

subsidiaries level.

Lower working capital was driven by consolidated cash conversion cycle (CCC)

improving to 27 days in FY14 from 35 days in FY13. Standalone CCC improved to

(29) days in FY14 [FY13: (14)]. Even subsidiaries’ CCC reduced marginally to 94

days from 101 days in FY13.

Free cash flows also saw a huge jump from negative INR2.2b in FY13 to INR3.7b

in FY14, driven by capex and investment in subsidiaries of INR6.5b in FY14.

Exhibit 8: Improved cash flow led by lower working capital and higher EBITDA (INR m)

Particulars

EBITDA (Operations)

Add/less: Non-cash adjustments

Less: Direct taxes paid

Operating profit before w/cap changes

Inventories

Trade receivables

Loans and advances

Other current assets

Current liabilities and provisions

Cash generated from operations

before exceptional items

Add/(less): exceptional items

Cash generated from operations

Less: Financial cost

Cash flow from operations post

interest

Less: Capex

Less: Investment in subsidiaries

Free cash flow post interest

Standalone

FY12

FY13

FY14

5,543

6,301

7,470

295

135

-1,524

-1,312

-1,480

4,314

5,062

6,125

-1,267

-1,067

450

-275

-238

-808

-309

-3

-51

2,763

1,976

1,652

5,066

1,810

6,876

136

7,012

-365

-8,705

-2,059

5,725

-110

5,615

-1,609

-2,559

1,447

7,630

-461

7,170

-718

-6,348

103

Subsidiaries (derived)

FY12

FY13

FY14

3,107

3,523

4,033

-68

274

-576

-755

-898

2,463

2,828

3,410

-2,178

-1,565

-801

-1,004

-1,902

367

408

-621

156

-3

4,265

2,843

455

3,952

192

4,144

-558

3,586

-1,200

2,914

5,300

1,596

880

2,476

-733

1,743

-1,027

-4,352

-3,635

3,597

3,656

-672

2,984

FY12

8,650

227

-2,101

6,777

-3,445

-937

-400

-6

7,028

9,018

2,002

11,020

-422

10,598

Consolidated

FY13

9,824

133

-2,066

7,891

-2,632

-2,177

-598

4,818

7,321

880

8,202

-843

7,358

FY14

11,503

409

-2,378

9,535

-350

129

-153

-40

2,107

11,227

11,286

-1,132

10,154

-611

-1,565

-2,636

-1,329

1,182

-5,791

-6,911

-5,166

3,555

3,241

-2,188

3,659

Source: Company Annual Report, MOSL

Exhibit 9: Improved cash conversion cycle led by negative working capital in standalone

entity (days)

Particulars

Standalone

Inventory days

Receivable days

Payable days

Subsidiaries

Inventory days

Receivable days

Payable days

Consolidated

Inventory days

Receivable days

Payable days

FY12

FY13

FY14

-14

-29

104

129

138

101

105

125

124

113

109

112

117

Source: Company Annual Report, MOSL

5 January 2015

ART

Godrej Consumer Products FY14

Excise and VAT receivables higher than peers due to slower receipt of tax

refunds from government

Excise and VAT receivable

stood at 5% of FY14 net

worth; results in additional

working capital

requirement when

compared to peers



Excise and VAT receivables (at standalone level) increased from INR1.3b in FY13

to INR1.5b in FY14; 5% of FY14 net worth (FY13: 4.7%).

GCPL has some of its tax benefit units located in the North East region, unlike

peers that have such units mainly in the North.

GCPL’s excise and VAT receivables are higher than peers due to slower receipt of

refunds receivable by manufacturing units located in north-eastern states.

Exhibit 10: Excise and VAT receivables stood at 5% of net worth (INR m)

Long term receivables

Short term receivables

4.7%

4.4%

536

382

292

FY11

3.3%

314

772

512

FY12

FY13

FY14

771

% of net worth

5.0%

746

Source: Company Annual Report, MOSL

Exhibit 11: Excise and VAT receivables higher for GCPL when compared with peers (INR m)

Particulars

Long term receivables

Short term receivables

Excise & VAT receivables

% of revenue

% of net worth

Dabur

391

0.9%

2.5%

FY13

FY14

Marico

Jyothy Labs

GCPL

Dabur

Marico

Jyothy Labs

GCPL

151

772

140

771

135

536

381

183

746

219

135

1,308

381

193

183

1,516

0.6%

1.3%

3.7%

0.8%

0.5%

1.5%

3.7%

1.1%

1.9%

4.7%

2.0%

1.0%

2.1%

5.0%

Source: Company Annual Report; Dabur, Marico and Jyothy Labs annual reports; MOSL

Investment in Indonesia and African subsidiaries increases

Investment in subsidiaries

increased on account of

additional acquisition of

Darling group in Nigeria,

South Africa and

Mozambique



Investment in subsidiaries increased from INR14.5b in FY13 (44% of FY13 net

worth) to INR20.6b in FY14 (55% of FY14 net worth).

The increase is primarily led by investment in Godrej Consumer Products

Holding (Mauritius) (GCPHM) increasing from INR6b in FY13 to INR9.9b in FY14.

The Indonesian subsidiaries are domiciled in GCPHM. Further, investment in

Godrej Mauritius Africa Holdings (GMAH) increased from INR1.3b in FY13 to

INR3.1b in FY14. The African subsidiaries are domiciled in GMAH.

Investment in Indonesian subsidiaries is done for repayment of loan funds due

and balance investments pertain to purchase of 49% stake in the Nigeria

business of Darling Group and 4.63% stake in South Africa and Mozambique

business of Darling Group.

5 January 2015

ART

Godrej Consumer Products FY14

Exhibit 12: Investment in subsidiaries continues in FY14 (INR b)

Particulars

Godrej Consumer Products Holding (Mauritius)

Godrej Consumer Products Mauritius

Godrej Mauritius Africa Holdings

Others

Godrej Netherlands B.V.

Godrej Hygiene Products

Total investments

% to net worth

FY11

0.2

1.7

0.0

0.7

0.5

0.2

3.2

18.7%

FY12

FY13

FY14

4.4

6.0

9.9

5.5

5.7

0.6

1.3

3.1

0.7

1.3

0.5

0.8

0.2

0.0

11.9

14.5

20.7

42.6%

43.8%

54.7%

Source: Company Annual Report, MOSL

Bill discounting charges jumped by 1.5x to INR436m in FY14

Bill discounting charges

significantly increased to

INR436m in FY14 from

INR171m in FY13



Bill discounting charges increased from INR171m in FY13 to INR435.8m in FY14,

with a bulk of these expenses forming part of the domestic business. These

charges arise on debtors discounting and invoice discounting and form part of

the finance cost of the company.

Standalone debtors (net) stood at INR1,393m in FY14, with just 12 days of

receivables. The discounting of debtors is without recourse to the company.

Exhibit 13: Bill discounting charges jumped by 1.5x (INR m)

Particulars

Standalone

Subsidiaries (derived)

Consolidated

Debtors (standalone)

FY12

120

943

FY13

FY14

138

380

171

436

1,221

1,393

Source: Company Annual Report, MOSL

Employee cost continues to rise on account of higher overseas operations

Employee cost increased to

9.9% of revenue in FY14

from 9.2% in FY13 on

account of increased

overseas operation



Employee cost increased from INR5.9b in FY13 to INR7.5b in FY14 mainly on

account of higher cost in subsidiaries.

As a percentage of sales, employee cost increased from 9.2% in FY13 to 9.9% in

FY14.

Subsidiaries’ employee cost jumped from INR4.3b in FY13 to INR5.5b in FY14.

Exhibit 14: Subsidiaries’ employee cost continues to rise

Subsidiary's employee cost (INR b)

Employee cost as a % to revenue

Standalone employee cost (INR b)

9.9%

9.2%

7.7%

1.3

1.5

FY11

8.1%

1.6

2.4

FY12

1.7

4.3

2.0

5.5

FY13

FY14

Source: Company Annual Report, MOSL

5 January 2015

ART

Godrej Consumer Products FY14

Exhibit 15: Subsidiaries’ employee cost contribution increases to 73% in the

overall employee cost

Standalone employee cost mix (%)

Subsidiaries employee cost mix (%)

53.1

60.0

72.0

73.2

46.9

40.0

28.0

FY13

26.8

FY14

FY11

FY12

Source: Company Annual Report, MOSL

D/E marginally lower due to debt repayment; borrowing cost at 4.7%



GCPL’s total loan funds marginally reduced to INR23.7b in FY14 from INR24.5b in

FY13, with D/E declining to 0.63x from 0.74x.

GCPL has long-term borrowings of INR6.7b (FY14: INR5.1b), which are due for

repayment/to be refinanced in FY15.

Borrowing cost marginally increased to 4.7% in FY14 from 3.8% in FY13 due to

bill discounting charges increasing from INR171m in FY13 to INR436m in FY14.

Total finance cost (including bill discounting charges) increased to INR1,138m in

FY14 from INR820m in FY13.

Exhibit 16: Debt-to-equity comfortable at 0.6x in FY14 (INR m)

Particulars

Long term borrowings

- Secured

- Unsecured

Short term borrowings

Current maturities of long term borrowings

Total loan fund

Net worth

D/E (x)

FY11

10,670

2,749

1,267

5,320

20,006

17,252

1.16

FY12

FY13

FY14

7,038

4,106

8,242

14,556

15,903

359

824

1,115

3,129

5,078

6,711

18,768

24,564

23,729

28,040

33,130

37,754

0.67

0.74

0.63

Source: Company Annual Report, MOSL

Exhibit 17: Borrowing cost at 4.7% in FY14 (INR m)

Particulars

Interest on borrowings

Other borrowing costs

Bill discounting charges

Borrowing cost capitalized

Total finance cost

% of borrowing

FY11

274

163

436

3.7%

FY12

FY13

FY14

521

604

638

120

171

436

658

820

1,138

3.4%

3.8%

4.7%

Source: Company Annual Report, MOSL

5 January 2015

ART

Godrej Consumer Products FY14

Other financial highlights



GCPL has used funds of INR1.2b in FY14 raised on short term basis (primarily

from trade credit) for long term investment (non-current assets) as the company

operates on negative working capital.

Loss on foreign currency transactions and translation for FY14 is INR267.8m

(FY13: INR328m); 2.6% of FY14 PBT (FY13: 3.2%).

Exhibit 18: Hedged exposure jumped in FY14 (USD m)

Particulars

Forward Contract

Currency

USD

FY13

FY14

0.8

Source: Company Annual Report, MOSL

Exhibit 19: Unhedged foreign currency exposure dips significantly during FY14 (INR m)

Nature of outgo

Payables

Loan and interest payable

Receivables

Cash and cash equivalents

Net unhedged payables

Currency

USD

EUR, SGD, JPY, GBP

USD

ZAR, GBP, EUR

USD

EUR, ZAR

FY13

FY14

3,937

3,272

1,345

(1,060)

(891)

(161)

(178)

(496)

(1,429)

(61)

(25)

3,541

814

Source: Company Annual Report, MOSL

Exhibit 20: Increase in intangible assets driven by increased goodwill

on consolidation (INR b)

Particulars

Goodwill on consolidation

Other acquired intangible assets

Total intangible assets

FY11

15.4

11.8

27.2

FY12

FY13

FY14

21.5

29.1

35.5

11.5

10.9

10.5

33.0

39.9

46.0

Source: Company Annual Report, MOSL

Exhibit 21: Goodwill on consolidation increased to 94% of FY14 net worth

Goodwill on consolidation (INR b)

87.8%

76.5%

% of net worth

94.1%

89.3%

15.4

FY11

21.5

FY12

29.1

FY13

35.5

FY14

Source: Company Annual Report, MOSL

5 January 2015

ART

Godrej Consumer Products FY14

ART #3

GOVERNANCE MATTERS

Most directors are regular in attending board meetings



The company is regularly calling its board meetings as per the prescribed laws.

During FY14, it held five board meetings.

All directors have attended at least 50% of the meetings (at least three meetings

for FY14), except Ms Ireena Vittal and Prof Bala Balchandran, who attended two

meetings during FY14.

Exhibit 22:

Most directors attended Board meetings regularly

FY11

FY12

FY13

Particulars

Position

FY14

Mr. Adi Godrej

Chairman

Mr. Jamshyd Godrej

Mr. Nadir Godrej

Ms. Tanya Dubash

Ms. Nisaba Godrej

Mr. A. Mahendran

Mr. Vivek Gambhir *

Ms. Ireena Vittal *

NEI

Mr. Narendra Ambwani

NEI

Prof. Bala Balachandran

NEI

3(2)

Mr. Bharat Doshi

NEI

Dr. Omkar Goswami

NEI

4(2)

Mr. Aman Mehta

NEI

4(2)

Mr. D. Shivakumar

NEI

4(1)

Meetings held

Note: * Directors have been appointed on April 30, 2013 (first meeting in FY14); Source: Company

Annual Report, MOSL

Remuneration to key managerial personnel increased in FY14



Remuneration to key personnel increased to INR227m (2.2% of FY14 PBT) in

FY14 from INR124m in FY13 (1.2% of FY13 PBT).

Increase in remuneration is on account of additional remuneration to Ms Nisaba

Godrej (INR24m) and Mr Vivek Gambhir (INR67m).

Exhibit 23: Remuneration to key personnel increased to 2.2% of PBT

Particulars

Mr. Adi Godrej

Mr. Hoshedar Press

Mr. Dalip Sehgal

Ms. Nisaba Godrej

Mr. Vivek Gambhir

Mr. A Mahendran

Total

% of PBT

FY11

18.4

7.6

106

1.6%

FY12

FY13

FY14

137

124

227

1.4%

1.2%

2.2%

Source: Company Annual Report , MOSL

5 January 2015

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Disclosure of Interest Statement



Analyst ownership of the stock

GODREJ CONSUMER

ART

Godrej Consumer Products FY14

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