SUMMARY OF DABURS CHAIRMANS MESSAGE, MANAGEMENT DISCUSSION AND ANALYSIS AND DIRECTORSS REPORT

CHAIRMANS MESSAGE The fiscal year ended March 2011 with a double digit domestic inflation, disturbances in the Middle East and North Africas markets and the increase of crude oil prices. During this period, the Indian Economy grew at a rate of 8.6% and the consumer goods industry performed well. Dabur has ended the year with good growth in both revenues and profitability. The revenue grew by 20.3% and the Net Profit rose by 13.4%. This has been achieved by sustained investments in marketing and brand building, distribution, production and supply chain management. Dabur saw volume-led growth in categories like hair oils, toothpaste, skin care, health supplements, home care and foods. There were two overseas acquisitions- Turkey-based Hobi Group and Namast Laboratories LLC. On the domestic side, Dabur acquired Thirty-Plus, Indias first energizer and nutritional supplement brand.

During 2010-11, significant amount of growth was volume driven. Inspite of high raw material prices, rising food inflation and disruptive competition, the growth of consumption is still the same with real per capita disposable incomes continuing to rise and the Indian middle class emerging as a significant market. In the current inflationary scenario, Dabur takes cognizance of the opportunities arising because of pricing power due to strong brands and efficient capital structure which will help the company to emerge stronger through cost management, smart innovations and putting into play relevant Consumer insights. The industry is expected to more than triple in size from the current level of about $33billion in the next 10 years which will be ensured by steady demand conditions. However, the challenges in terms of cost pressures will have to be met through enhancing efficiencies and building strong and powerful brands. The report justifies their moto- Dedicated to the health and wellbeing of every household. DIRECTORS REPORT The 36th Annual Report on the business and operations of Dabur shows that the turnover for the company was 3313.83 for the fiscal year 2010-11.The Company paid an interim dividend of 50% and recommended a final dividend of 65% for the financial year 2010-11. The dividend payout ratio for the current year is 49.43%. The amalgamation of Fem Care Pharma Limited with the Company was completed on 18th June, 2010. The Company acquired Turkeys leading personal care products maker Hobi Kosmetik Group through Dabur International Limited and Namaste Group of US. Dabur is committed to focus on good corporate governance and adheres to the prescribed corporate practices which has earned for it recognition and has strengthened its bond of trust with the stakeholders and the society at large. The Company sustained its long term credit rating of AAA which reflects the Companys financial discipline and prudence. The Companys short term credit was rated P1+ by CRISIL. The directors confirm that the requirements under Section 217(2AA) of the Companies Act, 1956 with respect to directors responsibility statement are strictly met. The consolidated turnover grew by 20.47% and net profit after tax was higher by Rs.67.30 crore in the fiscal year 2010-11.

The Company has a well placed, proper and adequate internal control System for safeguarding of assets. The company did not accept any fixed deposit from the public for the FY 2010-11 and the nature of business of the company has not changed. During the year Fem Care Pharma Ltd. has ceased to be subsidiary of the Company due to its amalgamation with the Company. During the year, 19300617 options in 4 tranches were granted to eligible employees of the Company in terms of Employees Stock Option Plan. Various energy conservation techniques were initiated at large scale and successfully implemented. The Companys International Business recorded an impressive sales growth of 43.3% The exports from India have increased and company is expanding internationally even entering the European Retailers. New avenues for growth were opened up with expansion into the new markets of Congo, Armenia, Kazakhstan and Burkina Faso. In Dabur Health, Safety and Environment is integrated with the business processes, which focuses on People. During the year Dabur got various Awards and Recognitions in different categories and for different Brands. It was ranked 200 in the Fortune India 500 list that ranks Indias 500 largest corporations. The company is considered among top 10 working places under consumer goods and durable sector, listed as Top Green Company in Green Peace Safe Food Guide. Its brands Real fruit juices & Vatika Hair Oil bagged Readers Digest Trusted Brand Gold Award 2010. The Company maintained healthy, cordial and harmonious industrial relations at all levels. MANAGEMENT DISCUSSION AND ANALYSIS The year FY 2010-11 faced headwinds such as the Euro-zone debt crisis, political upheaval in Middle East and the twin catastrophes of earthquakes and tsunami striking Japan The Indian economy grew at 8.6% for 2010-11. Dabur managed inflation by effecting calibrated price increases and prudent buying leading to a growth of 21% in our operating profits. The EBITDA margins were stable at 19.9%. Aggressive marketing led to gain in market share in Chyawanprash, Glucose, Toothpastes and Toothpowders. In a year , marked by soaring inflation and disruptive competition, strategies such as calibrated price hikes, efficient buying, prudent management of overheads and sustained consumer connect activities across key markets helped Dabur move ahead on the growth track during 2010-11. The development of new products continues to be a key focus area at Dabur.

Daburs Health Care continued its strong run in the domestic market due to marketing strategies and launch of new products. This led to growth in sales of 16%. Dabur continued to dominate the digestive tablets space with its brand Hajmola. In The Skin Care category the Company emerged as the second largest Beauty Care Company in India The International Business Division recorded an impressive sales growth of 46.3% Dabur has highly developed Sales and Distribution network covering over 2.8 million retail outlets, with a high penetration in both urban and rural areas

To conserve the environment Dabur adapted to green manufacturing and the concept of Reduce, Reuse and Recycle The Company has put in place mechanisms to ensure that they are able to manage and mitigate risk with timely actions.