Jyothy Laboratories

Men often become what they believe themselves to be. If I believe I
 cannot do something, it makes me incapable of doing it. But when I
 believe I can, then I acquire the ability to do it even if I didnt
 have it in the beginning.”
 
 - Mohandas Karamchand Gandhi
 
 This quote from the Father of the Nation has inspired us at Jyothy
 Laboratories to always provide the common man with the best possible
 Value for his money.
 
 It pleases me to inform you that this time too, our focus on providing
 a value proposition and building our strong foundation has resulted in
 wide product acceptance.  This has helped us to post good results for
 the period of 9 months from July ’08 to March ’09.
 
 Furthermore, this has been made possible inspite of the shadow of the
 global economic crisis affecting the macro economic system of our
 country too.
 
 The growth numbers and the 9 months financials
 
 The accounting year end of your Company has been shifted from June 30th
 to March 31st. The decision to change our accounting year end from June
 to March was based primarily on the need to bring it on par with the
 conventional year ending period of peers, so as to enhance
 comparability.
 
 For better comparability we have compared this year’s numbers with the
 corresponding nine months of the previous year.  During the 9 months
 financial period 2008-09, we have registered Net Sales of Rs. 35,154
 lakhs, translating into a growth of 27 % on a year-on-year basis. The
 Operating Profits stood at Rs. 5,776 Lakhs, up 25 %, an indication of
 enhanced efficiencies at every step.  This strong operating performance
 has provided a bottom-line of 13 % increase in Net Profits, which stood
 at Rs. 4,011 lakhs.
 
 This performance can be attributed to various factors that include :
 
 Our reach
 
 We are able to offer a suitable range of quality products for people
 belonging to different socio-economic backgrounds at prices that meet
 their expectations.
 
 To reach out to these masses, our products are available in 2.9 million
 outlets (source A.C. Nielson) in India as of March 31, 2009. We have a
 strong distribution team with our own Sales Staff of over 1,500 people
 servicing approximately 3000 Distributors. We directly reach over 1
 million retail outlets every month covering rural as well as urban
 areas.
 
 Our business - value for money
 
 Our Fabric Care division consists of the following products:
 
 - Ujala Fabric Whitener used for brightness of white clothes
 
 - Ujala Detergent for washing
 
 - Ujala Stiff & Shine used as a post wash for crispness and colour
 enhancement
 
 The high brand awareness of Ujala will help the Company make inroads
 into the other fabric care segments.
 
 To give you a preview into the success we have achieved in Ujala
 Detergent and Ujala Stiff and Shine which are brand extensions of
 Ujala, we have grown over 65% combined during the period under review
 when compared to the same period last year.
 
 Household Insecticide Division Maxo, our mosquito repellent product is
 growing steadily and has registered a 31% growth, during the period
 under review.
 
 To reduce dependence on outsourcing and to avail fiscal benefits, we
 have invested Rs. 1,200 lakhs, approximately, in a plant at Jammu in
 2007-08. Following the commissioning of this plant, we are
 manufacturing almost 60% of Maxo coils in-house including our other
 units in the country.
 
 Surface Cleaning Division Exo, has grown by 98.7% for the period under
 review in South India. We have identified potential for its growth in
 the rest of the country.
 
 High recall value
 
 Being a strong performer in the fast moving consumer goods sector, we
 are in a position to foresee our growth path in any kind of
 socio-economic condition in our country. As most of our products are
 competitively priced and considered essential in the day-to-day life of
 households, we are able to look ahead with confidence, despite the
 uncertain macro economic scenario.
 
 This confidence is derived from our strong portfolio of brands,
 leadership in market share for select brands; trained sales staff and
 well established distribution network.
 
 Our new product launches and their successes in the southern regions,
 is an indication of the tremendous scope for expansion going ahead.
 
 If you consider that FMCG off-take constitutes a little less than 5% of
 India’s household expenditure, it is a clear indication of the immense
 growth opportunities that lie ahead for FMCG players in the country.
 
 New initiatives
 
 Jyothy Fabricare Services business is one of the recent initiatives of
 the company on which significant progress has been made. Our aim is to
 provide a “World class laundry at affordable prices at your doorstep”.
 We hope to repeat our success story of offering an optimal value and
 quality proposition and to convert an unorganized sector into an
 organised one. The Indian Fabric Care industry has thus far not
 witnessed major progress on the organised laundry business front and we
 hope to be the trend setters here too.
 
 An in-depth understanding of the markets, a well thought and planned
 launch and expansion strategy, helped by advanced technology once again
 remains the mission statement of this business.
 
 Due to the untiring efforts of our people, the launch of this
 initiative is on schedule and it should be commercially operative by
 September 2009.
 
 Our people, our strength
 
 At Jyothy, we believe in nurturing in-house talent and providing equal
 opportunities for all. This helps us develop leaders for tomorrow,
 capable of carrying forward our tradition of offering value for money
 products and services.
 
 Corporate governance
 
 I also take this opportunity to thank our Independent Directors, whose
 valuable contribution in terms of business insights have helped us
 reach higher and higher levels of excellence and productivity.
 
 I make it a point to personally interact with each one of them, seek
 their valuable inputs and keep them informed about the progress made
 thereafter.
 
 This is just a reflection of the belief in strong corporate governance
 culture that we at Jyothy Laboratories follow and would like to uphold.
 
 What sets us apart
 
 Our unique approach to market our products and meeting promises has
 made us a self-sustaining company. We also lay utmost importance to
 engineering and our Research and Development Team which is constantly
 working towards satisfying the needs of the common man through
 technology, through newer ways of enhancing quality and controlling
 costs.
 
 Another common thread that you will find across our organisation is our
 cost conscious approach. We strongly believe that a Rupee saved is a
 Rupee Earned and we implement that belief as a norm at all levels.
 
 The trust that we have built up for our brands has been rewarded by
 strong market share. Indeed, it pays dividends to have a basket of
 products that address the everyday needs of people, everywhere at an
 affordable price.
 
 A humble promise
 
 From a single product company, we have diversified over the last decade
 into a multi-product Company.
 
 This confidence has been derived from the immense support and good
 wishes we have been fortunate enough to receive from each of our
 stakeholders. My team and I accept the same with all humility and
 promise you that we will leave no stone unturned to fulfill our
 responsibilities in not only the year ahead but also thereafter.
 
 M. P. Ramachandran
 
 Chairman and Managing Director