The Directors are pleased to present the Annual Report on the business
 and operations of your Company and the audited accounts of the Company
 for the year ended 31 December 2010.
 
 Financial Results
 
                                                        (Rs. Lacs)
 
                                             2010            2009
 
 Sales
 (net of excise duty)                     23,06,11.83  19,21,50.23
 
 Profit before Depreciation,
 Amortisation and Tax                      4,91,51.39   3,95,88.46
 
 Less: Depreciation                          39,32.56     37,41.81
 
 Less: Amortisation of Patents
 and Trade Marks                                38.38      4,60.62
 
 Profit Before Tax                         4,51,80.45   3,53,86.03
 
 Less: Provision for Tax
 
 -    Current Tax                          1,67,97.00   1,39,50.00
 
 -    Deferred Tax                          (15,72.30)   (17,59.61)
 
 -    Adjustment of Previous Years             (29.49)    (2,61.37)
 
 -    Fringe Benefit Tax                         0.00      1,78.73
 
                                           1,51,95.21   1,21,07.75
 
 Profit After Tax                          2,99,85.24   2,32,78.28
 
 Previous year figures regrouped/reclassified wherever necessary to
 conform to this years classification.
 
 Appropriations
 
 Proposed Final Dividend                   2,10,27.77     75,70.00
 
 Corporate Dividend Tax                      34,92.45     12,86.52
 Transferred to General
 
 Reserves                                    29,98.52     23,27.83
 
                                           2,75,18.74   1,11,84.35
 
 Earnings Per Share (Rs.)
 
 (Basic & Diluted)                              71.30        55.35
 
 Performance of the Company
 
 Your Company has delivered another year of profitable growth by
 recording 20.0% increase in sales and 28.8% increase in PAT over the
 previous year. Continued focus on product innovation & expansion into
 new categories, strengthening of the distribution network, continued
 investment in brand building, strategic cost management and working
 capital management have helped your Company achieve this profitable
 growth.
 
 The year witnessed robust performance of your Companys key brands -
 Horlicks and Boost, both of which saw strong double digit growth.
 Horlicks registered a growth of 18.6% during the year 2010 with all
 variants of Horlicks registering a double digit growth. The year 2010
 saw a re-launch of the Horlicks brand with a changed brand identity and
 re- designed packaging aimed to bring about a unified new look in all
 the products under the Horlicks portfolio. The packaging is quite
 contemporary and has been designed keeping in mind the changing needs
 of the consumer. Your Company also continued to make significant
 advertising & promotion spends for the brand. Your Company had several
 successful campaigns during the year including one to increase
 consumption during examinations. The year also saw the launch of Junior
 Horlicks 4, 5 & 6 and Badam Masti which were well received by the
 consumer.
 
 With a growth of 24.3% in 2010, Boost has witnessed one of the best
 years in terms of sales growth as well as distribution. Boost which is
 now backed by a clinically proven claim saw an improvement in its
 market share. Your Company also launched a new variant in the Northern
 / Western part of India with the intent of delivering a great new taste
 as per the preference of consumers.
 
 Your Company continues to do well in the Biscuits category with a
 double digit growth in the existing portfolio and successful new
 product launches. Your Company launched Horlicks Cream Biscuits in 3
 flavours and Horlicks Cookies.  The initial response to these launches
 has been very encouraging.
 
 Foodies, which was launched in South India last year has performed
 exceedingly well in 2010. It was also extended to East in March 2010
 and North & West in July 2010. Foodies recorded sales of Rs. 32,35 Lacs
 during 2010.
 
 The year also witnessed the launch of Lucozade Sport - Isotonic Sports
 Drink, which marks your Companys entry into the Rs. 1.5 billion energy
 drink market of India. Lucozade is a scientifically formulated drink
 that is backed by years of research and enjoys the approval of several
 independent authorities. Through the launch of Lucozade, your Company
 has made strong inroads into a nascent and fast growing category in
 India.
 
 Your company has taken several initiatives to reduce operating costs in
 the business and maintain efficient working capital levels. This has
 helped your Company increase its EBIT by 22% during 2010 in spite of
 the inflationary pressures on the commodity front and higher
 advertising & promotion spends towards brand building. Your Company has
 also managed to significantly increase the yield on cash surpluses. The
 year also witnessed setting up of the shared service center for
 transaction processing, resulting in simplification of financial
 processes within the Company.
 
 Your Company has also setup a new supply chain function with integrated
 demand & supply management, logistics management and customer service
 as its focus areas. This has resulted in simplification of the planning
 process, inventory reduction and freight optimisation.
 
 In order to respond to the growing demand, your Company has launched a
 project to enhance capacity which is expected to be completed by 2012.
 This will increase the capacity at Sonepat plant by 16 - 18 thousand
 tones p.a.  and service the increased demand for your Companys
 products. This project entails introduction of new technology which
 involves extensive automation and controls. The expected cost of this
 project is Rs. 219 Crores, of which your Company has spent
 approximately Rs. 68 crores till 31 December 2010
 
 Dividends
 
 The Directors recommend a dividend of Rs. 50 (including a special
 dividend of Rs. 25) per equity share of Rs. 10 each for the financial
 year ended 31 December 2010, to celebrate the Golden Jubilee of your
 Company. If approved by the Members at the ensuing Annual General
 Meeting to be held on 29 March 2011, it will be paid on or before 11
 April 2011 to those Members whose names appear in the Companys
 Register of Members and to those persons whose names appear as
 beneficial owners (as per the details to be furnished by the
 Depositories in respect of the shares held in dematerialised form) as
 at the close of business hours on 14 March 2011.
 
 Reserves
 
 The total Reserves as on December 31, 2010 stood at Rs. 9,17,98.32 Lacs
 representing an increase of 6.4% from last year.
 
 Exports
 
 During the year the Companys export earnings amounted to Rs.
 1,76,44.89 Lacs representing an increase of 13.5% over the previous
 year. In 2010, your Company started exporting to Nigeria and Kenya. The
 other main markets where your Company continues to export are
 Bangladesh, Myanmar, Malaysia, Sri Lanka, Middle East, Nepal and
 Bhutan.
 
 Research and Development
 
 The Research & Development (R&D) function played a significant role in
 your Company achieving its aspiration for profitable growth in 2010.
 The R&D function contributed through its efforts on new product
 innovations, superior claims development and cost savings initiatives.
 
 During the year the R&D function has adopted Open Innovation
 methodology, a platform for technology and innovation enhancement
 through use of internal as well as external ideas through external
 partnering. The Open Innovation team has already made great strides.
 Several successful external leads are being pursued across new product
 formats and high-science ingredients, which will help fast-track and
 deliver higher value innovations over the next couple of years.
 
 The R&D function continues its focus on building a strong claims
 pipeline and having a robust regulatory strategy in place to support
 the innovation programme. The Regulatory Affairs team has been closely
 engaging with Regulators and Key Opinion Leaders in the Indian
 Government and actively partnering in the development of the new Food
 Safety and Standard Authority of India (FSSA) regulations.
 
 R&D efforts were recognised by several internal and external awards and
 recognitions. The most significant being the 4 India Star Awards and an
 award each in Asia Star and World Star for excellence in packaging
 development.
 
 ISO Certification
 
 Your Companys manufacturing facilities at Nabha, Rajahmundry and
 Sonepat continue to be certified to the latest version of ISO 9001:
 2008, ISO 22000: 2005, ISO 14001: 2004 , OHSAS 18001: 2007 by SGS, a
 leading International Certification Company. These certifications
 indicate our commitment in meeting, in a sustainable manner, Global
 Quality, Environment Health and Safety Standards.
 
 Information Technology
 
 Your Company continues to be at the forefront of Information Technology
 having facilitated implementation of Shared Services Center for
 financial processes. The Company has implemented robust supply chain
 planning solution and is stepping further to strengthen its sales force
 with latest technology.
 
 Conservation of Energy, Technology Absorption and Foreign Exchange
 Earnings and Outgo
 
 Information required as per the Companies (Disclosure of particulars in
 the Report of the Board of Directors) Rules, 1988, is given in the
 Annexure to this Report.
 
 Directors
 
 At the Annual General Meeting held on April 23, 2010, six Directors
 were elected under the system of proportional representation. Mr. Kunal
 Kashyap, Mr. P Dwarakanath, Mr. Praveen K Gupta and Mr. Subodh Bhargava
 were re-elected as Directors of the Company and Mr. Naresh Dayal and
 Mr. Mukesh H Butani were the newly elected Directors of the Company.
 
 Mr. Ashok Dayal ceased to be the Director of the Company upon
 conclusion of the Annual General Meeting held on April 23, 2010. The
 Board of Directors wish to place on record its sincere appreciation for
 the valuable advice and guidance rendered by Mr. Ashok Dayal during his
 tenure as Director.
 
 Auditors
 
 Messrs. Price Waterhouse, Chartered Accountants, who retire at the
 conclusion of the forthcoming Annual General Meeting and being
 eligible, offer themselves for re-appointment.
 
 Human Resource Development
 
 Leadership Development & Talent Management remain key focus areas of
 the management. Workshops on Energy for Performance were conducted
 for senior leadership to enable them to create & sustain high levels of
 energy & enthusiasm ioT effective performance; bcAh a\ an mdiwKiual and
 organisational level. A highly experiential intervention on Project
 Leadership Skills was conducted for cross- functional teams. The year
 also saw managers across levels & functions go through structured
 interventions on Change Management and Personal Effectiveness &
 Development.  The Nabha Wage Settlement was concluded successfully &
 harmonious industrial relations continued at all the units throughout
 the Company.
 
 Environment and Social Commitment
 
 Your Companys quest to improve the quality of human life has always
 been supported by its Community Investment programmes and through the
 Community Partnership function.
 
 The year started with Nabha donating clothes at GOONJs Jalandhar
 Centre as part of Vastradaan Mahayagya (clothes donation - supreme
 holy ceremony). The site also organised medical checkups for students
 and provided them with medicines. The students were also given
 information on communicable diseases. Among other activities, Nabha
 donated several educational and classroom teaching aids to a school for
 physically and mentally challenged kids along with organising Hand
 Wash Day to educate Nabha school children on personal hygiene.
 
 The Sonepat site helped in spreading awareness about tuberculosis and
 its adverse impact amongst students from a Government School. There was
 a Know Tuberculosis awareness session and quiz, followed by
 distributing nutritional food among TB patients- The team also kicked
 off an initiative titled Protect Tomorrow-Towards a Safe & Green
 Future. It included interactive sessions on Environment Management,
 Safety and Energy Conservation. The site also sponsored girl child
 education programmes.
 
 Rajahmundry was actively involved in a number of activities for the
 entire year. The Rajahmundry team and nursing college students
 participated in a rally to create tuberculosis awareness on World TB
 Day. The team also distributed food, Horlicks, Horlicks biscuits and
 supplementary medication for TB patients at the Government Primary
 Health Centre.  The team also supported the medical camp for residents
 of Industrial Estate in Dowlaiswaram and the renovation of an
 
 Old Age Home. Other programmes included scholarships for students at
 various stages of education, nutritional support to PLHIV/AIDS affected
 patients, Little Hearts programme and Basic Life Support Classes on
 International Guidelines for Public and Health Workers.
 
 Your Company strives to improve the quality of life and partnering with
 the society to improve, rebuild and create awareness about important
 social issues through Orange Day events. These events are led,
 implemented and managed by your Companys employees, thus taking
 forward your Companys philosophy of developing self and others. The
 Company also supported numerous Community Partnership Projects in the
 sphere of childrens education and healthcare, support to the homeless,
 education and empowerment of tribal children, sustaining healthcare and
 livelihoods of the tribal community across the country.
 
 Particulars of Employees
 
 Information as per Section 217 (2A) of the Companies Act, 1956, read
 with the Companies (Particulars of Employees) Rules, 1975, as amended
 from time to time, forms part of this Report. However, as per the
 provisions of Section 219(1 )(b)(iv) of the Act, the report and
 Accounts are being sent to all the members excluding the statement
 containing the particulars of employees to be provided under Section
 217 (2A) of the Act. Any member interested in obtaining such
 particulars may inspect the same at the Registered Office of the
 Company or write to the Company Secretary for a copy.
 
 Management Discussion and Analysis Report
 
 The Management Discussion and Analysis is reported in this Annual
 Report.
 
 Acknowledgements
 
 The Directors wish to extend their thanks and appreciation to all the
 employees of the Company at all levels, agents and other business
 associates for their commitment, dedication and respective
 contributions to the Companys operations during the year under review.
 
 The Directors would also like to acknowledge the valuable guidance,
 technical assistance and advice being received from the Associate
 Company in the U.K.
 
 Your Directors look forward to the future with confidence.
 
 Directors Responsibility Statement as per Section 217(2AA) Of The
 Companies Act, 1956
 
 The financial statements of the Company for the year ended December 31,
 2010 have been prepared in conformity with the accounting standards
 issued by the Institute of Chartered Accountants of India and the
 requirements of the Companies Act, 1956. All the financial statements
 have been prepared on a historical cost convention, as a going concern
 and on the accrual basis. There have been no material departures in the
 adoption and application of the accounting standards.  The accounting
 policies used in the preparation of the financial statements have been
 consistently applied except where otherwise stated in the notes to
 accounts.
 
 The Board of Directors of GlaxoSmithKline Consumer Healthcare Limited
 (GSKCH) accepts the responsibility for the integrity and the
 objectivity of these financial statements.  The estimates and
 judgements relating to the financial statements have been made on a
 prudent and reasonable basis in order to ensure that the financial
 statements reflect in a true and fair manner the form and substance of
 the transactions and reasonably present the Companys state of affairs
 and profits for the year. To ensure this the Directors have taken
 proper and adequate care for the maintenance of adequate accounting
 records in accordance with the provisions of the Companies Act, 1956.
 The internal control systems are reviewed, evaluated and updated on an
 ongoing basis. Our internal auditors have conducted periodic audits to
 provide reasonable assurance that the established policies and
 procedures of the Company have been followed for safe-guarding the
 assets of the Company and for protecting any form of fraud and
 irregularities, subject to the inherent limitations in any system and
 procedure and coverage thereof that should be recognized in weighing
 the assurance provided by system of internal controls and accounts.
 
 The financial statements have been audited by Price Waterhouse,
 Chartered Accountants. The Audit Committee of GSKCH meets on a
 quarterly basis to review the manner in which the internal auditors are
 performing their responsibilities and to discuss auditing, internal
 controls and financial reporting issues. To ensure complete
 independence, the internal auditors have full and free access to the
 members of the Audit Committee to discuss any matter of substance.
 
 For and on behalf of the Board
 
 S.J.Scarff        Zubair Ahmed                  R Subramanian
 
 Chairman          Managing Director             Kunal Kashyap
                                                     Directors
 
 Place : Gurgaon
 Dated : 2 February 2011