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Advanta India Limited

Dear Shareholder,

This is the second Annual Report that we are bringing out post the IPO in 2007 and we are very happy to present this annual report to you. We have made a significant progress in these two years and we are happy to share the details with you. 2008 was one of the extraordinary years for the agricultural input industry. The first half of the year saw an upsurge in the agricultural commodity prices and a high level of demand for good quality inputs. Seed industry was no exception. Some of the crops like sunflower and corn saw a tremendous surge in demand for seed and the industry could not supply enough seed to meet the demand. Even crops like sorghum witnessed an extraordinary increase in demand. The farmers were visibly very happy as they realized higher profits in agriculture after many years. Agricultural biotechnology continued its rapid progress during this year in many countries including India. The second half of the year saw a dramatic fall in the economies around the world. The extraordinary slow down of economic activity and the consequent fall in demand in all spheres of life have unfolded the most dramatic economic slow down that is unprecedented in the last 70 years. Fortunately agriculture and seed industry have not been much affected by this down turn so far. However the sharp reduction in the availability of credit from the banks to both industry and agriculture in many parts of the world is bound to have an impact on the demand for good quality agricultural inputs in 2009. The agricultural commodity prices declined rapidly. The second half of the year also witnessed drought situation in Australia and Argentina. However the current agricultural commodity prices are still much higher than their levels in 2007. The farmers are in a happier position now because of the profitable agriculture they had in 2008. Agriculture biotechnology continues to promise higher value agriculture for the farmers and is witnessing very high adoption. These factors make us look positively at 2009. As a company Advanta has posted very impressive results in 2008. While the acquisitions have helped us with the growth in revenue and profits, the organic growth is equally impressive. l We have had very good growth coming from Argentina where our investments in taking a more aggressive approach to the sorghum and sunflower markets has helped us. l The RR Canola introduction in Australia has given us good results. l Our new field corn hybrids are accepted very well in Thailand and have proved to be winners in many parts of the country. l We made significant progress in the hybrid rice markets and the hybrid mustard markets in India during this year. l Our International business has shown very good results in Pakistan, Sudan, Indonesia, Venezuela and other countries. l this year we have stepped up our research investments During considerably to more than 10% of our revenues, most of which is charged to the current year's income statement. This is a major investment we are making in the future of the company. established a global supply chain function that has now created an integrated supply unit. This helps us to have the most efficient production models around the world for our products. We have expanded capacities in many of the countries. We now process our seed in one of the finest facilities in Hyderabad with all the modern equipment. l Our global quality function ensures that we make continuous progress with enhancement of the quality of our products. We have considerably upgraded our quality facilities in India. l the end of the year we signed an important agreement Towards with Arcadia Biosciences to license their Nitrogen Use Efficiency technology at the global level on an exclusive basis. We are now one of the largest sorghum seed companies in the world. We believe that sorghum offers the best options to be farmer for low investment agriculture and in dry conditions. We have also launched a global Bioenergy project in which we are promoting the use of sweet sorghum in bioethanol production. We very much believe in the future of sorghum. We would like to offer the best technologies to the sorghum farmer. This license is a step in this direction. l Through acquisitions we added the sorghum business of Garrison Townsend and a sunflower business in USA during the year. The private label sorghum and sunflower businesses that we added to our portfolio in the US have given us a foothold in this new geography for us, apart from significantly increasing our sorghum strength around in the global markets. l The vegetable seed business of Unicorn that we acquired in India in this year, combined with Golden Seeds that we acquired last year, has given us the necessary critical mass in the Indian vegetable seed market. We have integrated these two business units and the combined business is now run from Hyderabad. l set up a biotech laboratory in Hyderabad in India. This is We have an investment we have made in line with our strategy to invest in this important new area of our business. l The Nutrisun project has met the milestones and has progressed as per plan in 2008. The oil is slated to be in the market in 2009 as per the plan. Overall 2008 was a very good year for us, in spite of the downturn in the global economy observed towards the second half of the year. We are making rapid progress in making Advanta a strong global company. We have an excellent team in the company that is working very hard to make this progress a sustainable one. We are sure all of you share the same enthusiasm about Advanta's prospects as much as we in the management team do. Thank you for your support. Sincerely, We have l

VR Kaundinya CEO and Managing Director

PROJECT PUNCH : Strategic initiation to reposition the Seed business for futuristic & customer-centric new era - Bhupen Dubey ­ Head, Integrated Business ­ India

Background UPL is one of the top 4 generic Agrochemical giants in the world and India's biggest producer and exporter of Agrochemicals. Advanta was the Netherlands based global seed giant, part of which was acquired by UPL group in April 2007 and Global Head quarter was moved to Hyderabad. This was the first significant strategic move by Agrochemical giant UPL to make a foray into the fastest growing Seed industry. Subsequently, Golden Seeds and Unicorn Seeds ­ both medium size Vegetable seeds companies based at Hyderabad and Bangalore, respectively, were acquired in the subsequent year. With these initiatives UPL through 3 acquisitions expanded its footprints beyond field crops and vegetable crops. The Management had two strategic options to manage Indian input business as under: a) Manage each entity as an integrated business "as is where is" basis and grow each one independently. b) Integrate all 4 entities viz. UPL Agro formulation, Advanta Field crop, Golden Vegetable and Unicorn Vegetable range. After long detailed deliberations on the above 2 options management decided to pursue Integration option to get synergy out of merging of the above 4 entities. Operation "Project Punch" was launched under guidance of Global CEO & MD, Mr. V. R. Kaundinya and Exec.-Director, Mr. Vikram Shroff in March 2008 to achieve following 3 core objectives. 1. To offer Complete Crop Solutions to farmers under one umbrella. 2. To Capture Synergy through increased Productivity of people & Leverage Channel Capabilities resulting in increased market share & revenue. 3. To Optimize Operating Cost. To conceptualise and implement this initiative, following core team was announced in March 2009. Steering Team: Bhupen Dubey : Vice President, Global Corporate Project Sudhanshu Gupta : Exec.-Asst. to Exec.-Director In the last one year steering team with the help of cross functional teams of all 4 entities integrated sales, marketing and supply chain function (partly). Effective 1st January 2009, new India integrated organization started working as one face to customers offering widest portfolio of solutions to Indian farmers. Following table reflects combine strength of integrated entity: No. of products : 450+ No. of customers : 4200 + No. of sales & marketing professionals : 382 +

Advanta India Limited

With overwhelming acceptance of biotechnology in agricultural sector in India, agrochemical business growth started to slow down. In fact products like cotton insecticides segments witnessed negative growth of 50% over the last the5 years since the introduction of Bt cotton. While on the other side cotton seed sector grew approximately 4 folds in the last 5 years on account of introduction of Bt Cotton varieties. Thus introduction of Biotech based new generation high tech seeds will continue to negatively impact agrochemical sales and will add hyper-growth to the seed business. Therefore "Biotechnology" is a "Bridge" between Agrochemical and Seed business facilitating value migration from chemistry to seed. Through "Project Punch" strategic initiative UPL-Advanta has created a future oriented customer centric Indian team. Through this initiative stake holders are expected to benefit as under: Indian farmers UPL-Advanta integrated team now has approximately 800 products and a team of well trained agricultural professionals spread across the country. In terms of numbers, this is the biggest team across agricultural input companies in Agrochemical and Seed sectors. This will enable UPL-Advanta to provide maximum extension services to Indian farmers. This will lead to enhancement of farm productivity and income per unit area. Trade Partners Earlier each company had their separate trade channel partners. Post integration now all companies are under one umbrella. At present there is hardly 20% overlap observed. This gives tremendous business opportunities to cross sales and expand portfolios for offering to customers. Integration has provided Business Growth Opportunities to business partners of all 4 entities. In turn they can engage and service villages under their command in a much better way. Shareholders Integration of 4 entities will lead to 2-way synergy: a) Cost synergy b) Revenue synergy This will result into better utilization of revenues; will help bring entire business of integrated SAP platform through resorting to better cross-function co-ordination and control. As a result the integrated team will be able to be more responsive to market dynamics. UPL-Advanta is the first company to take such a bold 3-way (Agrochemical, Field crop, Vegetable crop) integration project for the first time in the country. This will give us the first-ever advantage and result into better long term sustainable project growth. Employees In short time integration process is going to put a tremendous burden on employees as each one will have to be a fast learner of new products/technologies, markets, etc. At the same time most of the team having professional abilities/experience, will be able to adapt faster. In order to facilitate skill and knowledge base enhancement, we have initiated a "MODEL PLOT' programme where in each important state all integrated products performance will be demonstrated on farmer field. Objective is to impart training to in-house sales & marketing team at the same time demonstrate integrated strength of portfolio to end customer ­ farmer. From time to time we'll keep you updated on progress of "Project Punch".

ADVANTA: Global Biotechnology Initiatives

"Food, feed, fiber, and fuel for the world's 800 million people who suffer from hunger and poverty" ­ this is the formidable task for many countries, development agencies, and the global seed industry. Of the many strategies that have been forwarded to address the issues of global poverty and environmental degradation, Agricultural biotechnology is seen as a viable contribution to the solution. Agricultural biotechnology is a revolutionary tool that is transforming the agricultural sector and capable of making a significant contribution to meeting major global challenges. It has the potential to spur economic growth, increase productivity in the agricultural sector, reduce hunger and malnutrition, and lessen the environmental impact for sustainable agriculture. ADVANTA is an Indian seed company, with global foot prints and has strong R&D capabilities in genetics and biotechnology, which provide us a critical edge to develop innovative products. ADVANTA is committed to deliver the benefits of agricultural biotechnology to resource-poor farmers especially in developing countries. By identifying and matching agricultural problems with possible biotechnology-based solutions in different crops, we aim to develop new or improved proprietary hybrids in different field crops and vegetables. ADVANTA is contributing US$15 million to support scientific innovation and promote access to biotechnology in different crops to increase crop productivity.

ADVANTA's unique approach is to facilitate the access, employ, transfer and delivery of proprietary biotechnology applications from different strategic partners from public and private sectors in the research and development continuum. Complementing these efforts are an array of in-house capabilities and development of state-of-the art R&D infra-structure to ensure synergy between external inputs, and in-house R&D capabilities. Biotechnological tools like Molecular Markers and Marker Assisted Selection, Transformation, Di-haploidy, Gene discovery and Genomics and Bioinformatics are adopted for generation advancement; improve selection efficiency and precise plant breeding. ADVANTA in the past has used traditional plant breeding as the "engine room" for the development of its mandatory crops, however, to have differentiated products and remain competitive; biotechnology is the only way forward. Biotechnology is not only the production of GM products (often referred to as Transformation, Genetic Modification or Genetic Engineering), but it also includes other technologies such as molecular markers. This technology has been used very successfully in ADVANTA for many years, especially within the sunflower research program, where ADVANTA can rightly claim to be a world leader.

Advanta India Limited

For GM products, we have started accessing the technology by licensing from some of the big players for some crops and for others we develop "in- house". We have recently started this by acquiring genes, where proof of concept has been demonstrated in model crops and modifying our core crops to contain the new genes for the future. The ADVANTA biotech initiative target specific traits that can deliver value to the farmer or industry we can then share some of the extra value that is generated. Recently ADVANTA and Arcadia Biosciences Inc., Davis, California, USA (an agricultural technology company) have concluded three technology deals that give ADVANTA global exclusivity for sorghum for the Arcadia's nitrogen use efficiency, salt tolerance and drought tolerance genes. When successful these technologies will create a revolution within the sorghum industry and place ADVANTA in an incredibly dominant position as the global leader for the plant species. Based on strength of technologies ADVANTA has established its own dedicated sorghum transformation lab in Balcarce in Argentina. At ADVANTA our scientists are combining a broad range of different techniques­ from conventional genetic enhancement of plants to functional genomics. Their common ambition is the development of practical and commercial solutions to the problems facing farmers today. To achieve this they combine centuries-old scientific methods with cutting-edge modern technology. The richness and diversity of ADVANTA's germplasm resources, combined with the use of biotechnological tools, has accelerated the rate of innovation in Seeds. In field crops, R&D focuses on growers' primary aim: higher quality yield, raising the essential nutritional components, starch, oil or protein further improves value for food and feed, and increasingly bio-fuel applications.

Genetic modification and Marker-assisted breeding is helping to increase insect pests and disease resistance, enhance tolerance to abiotic stresses and improve quality for processors and consumers traits apart from the improvement of plant's agronomic properties. In Vegetables, ADVANTA develops new products to provide consumers with consistent high quality, improved appearance, taste and texture. ADVANTA Biotechnology Centre at Hyderabad This facility has been established to incorporate the latest biotechnology products and processes that support the plant breeding process. It will include Molecular Marker Technology, Transgenic Technology, High-through put Genomics and Bioinformatics capabilities, and other related technologies. Molecular markers will be a vital part of this cluster of technologies providing background recovery to enhance backcrossing projects, molecular mapping of important traits and molecular breeding approaches that stabilize genes of interest in early generations and positive linkage block building for maximizing heterosis. Gene discovery, sequencing and development are other areas of activity. These facilities will empower the breeders to accelerate the genetic gain for their crops of reference - this is critically important to meet the genetic need of farmers as well as nutritional needs of the growing populations plus build and improve our competitive position regarding other competing companies or suppliers of genetics to the Agri-industry. This is one of ADVANTA's key biotechnology facilities to provide global support for many of the crop species where ADVANTA have active research programs. ADVANTA believes biotechnology is a tool which can be used to better develop differentiated products and to build and strengthen our competitive position in future.

Advanta India Limited

Nutrisun Business Unit

Advanta Nutrisun BU is focused in the development and commercialization of special edible oils with enhanced traits to meet specific quality-demanding needs of today's food industry. In line with Advanta's core values of Innovation, Respect, Agility and Excellence we feel proud that our company has devoted efforts to create Advanta Nutrisun Business Unit for the development of special products with high added value. This involves the implementation of state-of-the-art technology and offers innovative solutions for agricultural products and a healthy food market. During the current year, several companies have tested at pilot plant scale our first product, High Stearic-High Oleic sunflower oil (HSHO), with very good results. Fortunately, in some cases we have even exceeded their expectations. This development is the result of many years of work in diverse areas such as a) b) c) d) Research where we have been able to achieve these special traits in sunflower which yield this novel and unique sunflower oil, Breeding strategies which make possible the introgression of these traits into elite lines to develop sunflower hybrids, Production section which make our seeds turn into grain in order to produce Nutrisun High Stearic, High Oleic sunflower oil. All this technical work is solidly supported by our legal department to protect the final product through the generation, protection and surveillance of patents, trademarks and plant varieties rights as well as products registration; Our fats and oils technical department which makes our product turn into the tailor made solution for each customer and a commercial section devoted to finally make it happen.


We are happy to announce that Argentina will not be the only location for oil production. In this year we have already started with high oleic sunflower oil production in India at pilot scale, expecting to achieve a dominant position in five years time .We will be producing high stearic high oleic sunflower oil in Europe and we have expansion plans for the Asiatic region as well. Our research and breeding promise to deliver even better products which will enlarge not only quality but also revenues. Our team is highly motivated to achieve and exceed our goals and although there is still a long way to go we strongly believe we are on the right move.

First Nutrisun High Stearic High Oleic sunflower oil. Dispatch when arrived at Japan.

First Nutrisun High Stearic High Oleic Sunflower Oil dispatch when leaving Argentina

First Chocolate bar produced with Nutrisun High Stearic High Oleic Sunflower Oil in Spain

Agreements signed with major players in India and in Spain


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