Chitawon Milk (P) Ltd.

Chitawon Milk Ltd has soft launched some of its products from 27 Chaitra 2066. The chairman of the company Mr. Laxman Babu Shrestha launched those products. The soft launch of two products; Milk Powder and Skimmed Milk Powder was carried out in two phases throughout the country. The first phase launch was carried out in Chitwon, Gorkha and Tanahun whereas Nawalparasi, Makawanpur, Rupandehi, Kaski, and Lamjung were the areas in the second phase launch.

Chitawon Milk (P) Ltd is yet another venture of Chitawon Co-E Group. The Company is
established with the sole purpose of producing skimmed Milk Powder (SMP), Baby Food
and other high value products such as Yogurt, Butter, Ghee, etc. The Company is now
converted into a Public Limited Comapny with equity investment of Dairy Development
corporation (DDC), a Government of Nepal undertaking, the pioneer in Dairy Development
of Nepal. They have an equity share of NRS 20 Million (Approx. 11%). It would be the first
SMP Plant in the private sector in Nepal and would cater about 30% of the domestic
market demand. With the establishment of Powder Milk Plant the major problem of milk
produces i.e. milk holiday will be dealt with to a larger extent. SMP can be stored for a
longer period of time and the plant can take in surplus milk supply even in the flush season
and hence milk farmers would be encouraged and motivated to produce more milk than
their usual production. This will benefit the economic condition of the farmers as well as
the national economy.

The proposed plant site is situated at Thimura at Bharatpur Municipality, Ward No. 1 of
Chitawon District. The proposed plant capacity would be 10 tons of liquid milk processing
and 15 tons of powder milk production in order to facilitate capacity enhancement of the
plant to 15 tons per day. At present the capacity at 100% would be 10 tons for both SMP
and liquid milk processing. The Company has entered into a turnkey agreement for
machinery supply, supervision and commissioning with GEA ProcessEngineering (India)
Ltd (GPINL) Vadodora, India, on 30th November 2006. The plant layout detailing including
factory building layout has been finalized and construction is to be started within
July/August 2007. Letter of Credit for machinery has been opened in favour of GPINL.

The project is funded by the consortium of following local Banks:
1. Nepal Investment Bank Ltd - Lead Bank
2. Nepal Bank Limited - Partner in Consortium
3. Bank of Kathmandu - Partner in Consortium