Anheuser Busch Inbev (Sabmiller) India Limited Shares

Financial Report Summary

Anheuser Busch InBev India Limited's standalone financial statements for the period 01/04/2022 to 31/03/2023 disclose general information about the company, including its name, corporate identity number (U65990MH1988PLC049687), and permanent account number (AAAAK4512K). The registered office is located at Unit No.301-302, Dynasty Business Park, B Wing, 3rd Floor, Andheri Kurla Road, Andheri (East), Mumbai City, Mumbai, Maharashtra, India, 400059. The industry type is commercial and industrial, with a registration date of 18/11/1988. The company is categorized as a company limited by shares/Non-government company and is not listed.

Financial statement details include a standalone nature, presented in INR Millions with rounding, and using the indirect method for the cash flow statement. The books of account and relevant papers are maintained in electronic form at 6th Floor, Green Heart Building Mfar Manyata Tech Park, Phase IV, Nagavara Bangalore, Karnataka, India, 560045.

The principal product is beer made from malt (product/service category code 1), with turnover for the product or service category being 61,105 Millions of INR, and the highest turnover contributing product or service being the same beer made from malt (ITC 8 digit code 22030000) with a turnover of 61,105 Millions of INR.

Director's Report Disclosures

The Board of Directors reported a ~72% upsurge in turnover with market share expansion for FY 2022-23, yet the total expenditure grew by ~64% and net losses increased by ~20%. No changes to the nature of the company's business, however, subsequent to period end, the Company diversified into restaurants, bars, hotels, events, seed manufacturing and seed dealing. No dividend is recommended due to unavailability of distributable profits for FY 2022-23. The company's share capital structure as of March 31, 2023 included INR 15,000 million in authorized share capital and INR 9,28,42,28,030 in issued and paid-up share capital. No events altered the authorized capital during the year. The issued, subscribed, and paid-up share capital increased via private placement and preferential allotment to AB InBev Asia BV.

There were five Board meetings during the financial year. Details of inter-corporate loans under Section 186 are in Note 36 of the Audited Financial Statements for FY 2022-23. The company acquired 15,000,000 8% Non-cumulative Redeemable Preference Shares of Skol Beer Manufacturing Company Limited for INR 1 Lac in September 2022. Particulars of contracts with related parties referred to in Section 188(1) of the Companies Act 2013 for the Financial Year 2022-23 are detailed in AOC 2, which is enclosed as Annexure 3. The related party transactions are in Note 34 of the Audited Financial Statements for FY 2022-23.

The Secretarial Audit Report of M/s. Parikh & Associates is annexed, containing qualifications and reservations addressed in the report and the management's responses. Price Waterhouse & Co Chartered Accountants LLP were appointed as Statutory Auditors.

Regarding energy conservation, the company had initiatives focused on building team capabilities, implementing good operating practices, installing energy saving fans and motors in breweries, and conducting theme-based leakage audits. It is working to increase renewable energy percentage and has installed a solar plant. The report states no expenditure was incurred on research and development. The Company implemented strategic initiatives and technological interventions (via CapEx) to enhance processes and energy efficiency.

There are no subsidiaries, Joint Ventures or Associates. The Company's Board of Directors holds overall responsibility for risk management policies which are established to identify and analyse the risks faced by the Company and regularly reviewed to reflect changes in market conditions.

The Board of Directors included Sapna Taneja (Independent Director), Mahesh Kumar Mittal (Whole Time Director), Kartikeya Sharma (Whole time Director), Rashmi Sharma (Independent Director), and Shantanu Krishna (Non-Executive Director) as of March 31, 2023. Key Managerial Personnel as of the same date included Aastha Sharma (CFO) and Mansi Bajaj (Company Secretary).

There were no instances of any significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future. The Company has an adequate vigil mechanism. A Policy on Prevention, Prohibition and Redressal of Sexual Harassment at the Workplace has been adopted. One sexual harassment complaint was received and disposed of during the year. There was no application made under the Insolvency and Bankruptcy Code, 2016.

The statement pursuant to Section 134 (3) of the Companies Act, 2013 read with Rule 5 pertaining to the remuneration of employees of the Company is not applicable to the Company being an unlisted company. The directors confirm that applicable accounting standards have been followed, proper and sufficient care has been taken for the maintenance of accounting records, and the annual accounts are prepared on a going concern basis.

The Board also approved a Corporate Social Responsibility in terms of Section 135 of the Act. A report on CSR activities and initiatives of the Company for the FY 2023-2024 is enclosed as Annexure - 1. The composition of the Audit Committee as on 31st March 2023 is as follows: Ms. Sapna Taneja, Independent Director (Chairperson); Ms. Rashmi Sharma, Independent Director; and Mr. Mahesh Kumar Mittal, Whole Time Director.

Material changes that affect the Financial Position of the Company include the filing of suo-moto applications for compounding/adjudication of penalty for offence committed under Sections 118, 149, 152, 177, 178, 196 and Schedule IV of the Companies Act, 2013 in previous years, the Company's investment into Preference Shares of Skol Beers Manufacturing Company Limited (“SBMC”) and liquidation of SBMC, and the Company's increased issued, subscribed and paid-up share capital of the Company by allotment of 8,80,08,892 Equity Shares.

The Composition of the Audit Committee as on 31st March 2023 is as follows: Ms. Sapna Taneja, Independent Director (Chairperson); Ms. Rashmi Sharma, Independent Director; and Mr. Mahesh Kumar Mittal, Whole Time Director. Terms of reference and performance of Committees and individual directors were also outlined.

Auditors had a qualified opinion regarding non-compliance with Sections 96(1) and 134(2) of the Act and also due to non-availability of the supplier's information under the provisions of MSME act 2006. Emphasis was placed on matter regarding loan to related party during the financial year ended March 31, 2020.

Material weaknesses identified in the Company include failure to appropriately follow its internal financial controls, resulting in penalties. The Internal Audit system is not commensurate with the size and nature of the business. Details of contracts/arrangements/transactions with related parties at arm's length are provided in the report. As per the provisions of Section 135 of the Companies Act, 2013 and rules made thereunder, the annual report on CSR activities and initiatives of the Company for the FY 2023-2024 is enclosed as Annexure - 1.

Financial Details

The revenue from operations in FY 2022-23 was INR 61,774 million, compared to INR 36,081 million in FY 2021-22. Profit before taxation was (INR 4,389) million in FY 2022-23 compared to (INR 3,653) in FY 2021-22. Total comprehensive income (loss) for the year was (INR 4,384) million in FY 2022-23 compared to (INR 3,660) million in FY 2021-22.