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Directors Report of Jamna Auto Industries Ltd.

Mar 31, 2015

Dear Members,

The Directors of your Company have pleasure in presenting 49th Annual Report, together with the audited accounts and performance for the year ended March 31, 2015:

Financial Results

Rs. in crore

Particulars Standalone Consolidated

Year Year Year Year Ended Ended Ended Ended March March March March 31, 2015 31, 2014 31, 2015 31, 2014

Gross Sales 1,098.75 804.07 1,185.22 893.83

PBIDT 85.99 42.38 96.50 50.25

Finance cost 16.88 20.70 18.02 24.07

PBDT /Cash Profit 69.11 21.68 78.48 26.18

Depreciation & others 29.29 24.85 31.10 25.91

PBT 39.82 (3.17) 47.38 0.27

Previous year adjustment - (16.44) (16.44)

Provision for current tax 7.54 0.03 15.50 3.90

Provision for deferred tax 2.84 (1.05) 2.50 (1.04)

PAT 29.44 14.29 29.38 13.84

Balance brought forward (69.58) (78.87) (72.10) (80.94)

Adjustment of opening (2.85) - (2.85) depreciation as per Companies Act

Profit available for 29.44 14.29 29.38 13.84 appropriation

Balance carried to (53.62) (69.58) (56.19) (72.10) Balance Sheet

Performance

During the FY 2014-2015 the M&HCV segment appears to have gradually come out of recessionary trends with a growth of 17.40 per cent in sales. However, the LCV segment is still experiencing sluggish trends.

The Company being a major supplier to M&HCV segment is largely benefited by pick up in M&HCV segment. The Company has earned profit after tax of Rs. 29 crore during FY 2014-2015 as against Rs. 14 crore in FY 2013-2014.

During the year under review the Company has reduced its debt from Rs. 125 crore to Rs. 64 crore. This has not only reduced the fxed cost but also lowered breakeven level. The credit rating of the Company is improved three notches from LBBB- to A- (long term) and from A3 to A2 (short term). The credit rating is further improved in April 2015 to A (long term) and A1 (short term).

During the year under review the Company has got additional volumes on account of increase in its share of business with major customers. After achieving double digit growth in previous three years, After Market business has stabilized and remained fat during the year. Lift Axle business has shown promising growth as compared to previous year.

The Company is investing in expansion of Hosur Plant to build up capacities and capabilities to improve product quality and deliveries. This will help the Company to venture in new markets.

During the period under review and till the date of last reporting no such material changes/ commitments have taken place as to affect the financial position of the company.

IPR

Your Company is owner of copyright of more than 70 design of Leaf and Parabolic Springs. The Patent Application of the Company for Indian Patent for Air Suspension is pending before the patent authorities.

Human Resource

The relations with employees and associated workforce remained cordial throughout the year.

Dividend

Your Company proposed to pay accumulated dividend of Rs. 1,096,747 to IFCI Limited on 12.50% Optionally Convertible Cumulative Preference Shares. Your Directors also recommended final dividend of Rs. 2.20 per Equity Shares. Payment of dividend is subject to approval of the members of the Company at the ensuing Annual General Meeting.

Fixed Deposit

During the period under review, the Company did not accept any deposits from the public in terms of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014.

Energy Conservation, Technology Absorption & Foreign Exchange

The particulars as prescribed under Section 134 (3) (m) of the Companies Act, 2013 read with rule 8 of Companies (Accounts) Rules, 2014 form an integral part of this report and attached as Annexure – A.

Risk Management Policy

In accordance with the provisions of the Companies Act, 2013 and Listing Agreement, the Company has constituted a Risk Management Committee for identification and mitigation of the risk. The Committee has formulated the Risk Management Policy which is duly placed at the company's website. The details about the Committee are elaborated in Corporate Governance section which forms an integral part of this report.

Vigil Mechanism

In terms of the requirements of Section 177 (9) of the Companies Act, 2013 read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014, the Board of Directors has established a vigil mechanism for employees to report genuine concerns about unethical behavior, actual or suspected fraud. The vigil mechanism is posted on the website of the Company. Vigil mechanism also provides adequate safeguards against victimization of employees and Directors who avail of the vigil mechanism.

Corporate Social Responsibility (CSR)

The CSR policy of the Company is placed on the website of the Company which is administered and reviewed by the CSR Committee. During the FY 2014-2015 the Company has undertaken projects in accordance with Schedule VII of the Companies Act, 2013. Annual report on CSR pursuant to Section 135 of the Companies Act, 2013 read with rule 9 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 form an integral part of this report and attached as Annexure – B

Board of Directors, their Appointment & Remuneration

The Board provides strategic direction to the Company. The total strength of Board of Directors of the Company is eleven Directors consisting of Independent, Executive and Non-executive Directors. The composition of the Board is in conformity with Companies Act, 2013 and Clause 49 of the listing agreement. During FY 2014-2015 four meetings of Board of Directors were held. The details of Board, attendance of Directors at Board Meetings and remuneration paid to them are elaborated in Corporate Governance section which forms an integral part of this report.

During the year under review Mr. V. Subramanian, Nominee Director of IFCI Limited ceased to the director due to repayment of loan of IFCI Limited. Seth Ashok Kumar, Independent Director has stepped down from the Board. The Board places on record its appreciation of the valuable services rendered by Mr. V. Subramanian and Seth Ashok Kumar during their tenure as Directors.

In accordance with Section 152 and other applicable provisions of the Companies Act, 2013, Mr. R. S. Jauhar and Mr. P. S. Jauhar retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment.

During FY 2014-2015 none of the Independent Director was re-appointed. Mr. Rakesh Kalra and Ms. Payal Chawla were appointed as Independent Directors with effect from February 3, 2015. Proposal for confirmation of appointment of Mr. Rakesh Kalra and Ms. Payal Chawla as Independent Directors for a period of fve consecutive years is being placed for consideration of members of the Company at the ensuing Annual General Meeting.

All the Independent Directors have given declarations as to their being not disqualified to be appointed as an independent director and independence pursuant to the provisions of Section 149 of Companies Act, 2013 and listing agreement.

All the Executive Directors are appointed for a fixed term, normally, of three years on the recommendation of the Nomination & Remuneration Committee by the Board subject to the approval by members of the Company. All the Independent Directors are appointed for a period of fve years. The Independent Directors are not liable to retire by rotation.

The Executive Directors are paid monthly remuneration as per terms of their appointment. Non-Executive Directors are paid sitting fee for attending meeting of the Board and Committee meetings of the Board. The Nomination & Remuneration Committee review and makes recommendation of the remuneration of Directors.

Annexure-C of this report relates to appointment nomination and remuneration of Directors. The same is also available at the website of the Company.

Related Party Transactions

All transactions made by the related parties were in the ordinary course of business at arm's length pricing basis. The Company has also formulated a policy on dealing with the Related Party Transactions and materiality of the related party transactions. The policy is also posted at the website of the Company. Approval of the Audit Committee, Board and Shareholders as the case may be is also taken to enter into any Related Party Transaction. Attention of members is also drawn to notes to financial statements which set out related party disclosures.

Form for disclosure of particulars of contracts/arrangements entered into by the Company with Related Parties referred to in Section 188 of the Companies Act, 2013 forms an integral part of this report and attached as Annexure – D.

Extract of Annual Return

Extract of annual return as prescribed under Section 134 (3) (a) of the Companies Act, 2013 read with rule 12 of Companies (Management and Administration) Rules, 2014 forms an integral part of this report and attached as Annexure – E.

Employee Stock Option Scheme

The particulars with regard to the Employees Stock Options as on March 31, 2015 as required to be disclosed pursuant to the provisions of the Companies (Share Capital and Debentures) Rules, 2014 and SEBI ESOP Guidelines 2014, forms as integral part of this report and attached as Annexure – F.

Corporate Governance

The Company is in compliance with requirements of Corporate Governance mentioned in Clause 49 of listing agreement. The Company has documented insider trading code and code of conduct as part of internal policies; the same are placed on the website of the Company.

Total four meetings of the Board of Directors were held during the FY 2014-2015. Corporate governance report of the Company along with certificate of compliance forms an integral part of this report and attached as Annexure – G.

Statutory Auditors

M/s S. R. Batliboi & Co; LLP, Chartered Accountants are the Statutory Auditors of the Company. Directors recommend the ratification of re-appointment of M/s S. R. Batliboi & Co; LLP, Chartered Accountants as Statutory Auditors at the ensuing Annual General Meeting. The Audit Committee has also recommended the ratification of re-appointment of the Statutory Auditors.

The report of the Statutory Auditors read with the notes on accounts being self-explanatory, needs no further clarification. No qualification, reservation or adverse remark has been reported in their report.

Cost Auditors

Pursuant to Section 148 of the Companies Act, 2013, M/s Goyal Goyal & Associates, Cost Accountants and M/s Vijender Sharma & Co; Cost Accountants are proposed to be re-appointed as Cost Auditors for the FY ended on March 31, 2016.

Secretarial Auditors

Pursuant to Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, M/s K.J. & Associates, Company Secretaries are appointed as Secretarial Auditors for the FY ended on March 31 , 2016.

The Secretarial Audit Report for the financial year ended on March 31, 2015 forms an integral part of this report and attached as Annexure – H.

Internal Auditors

M/s Protiviti Risk & Business Consulting is appointed as internal auditor of the company from April 1, 2015.

Subsidiary Entity

The Company is majority partner in Jai Suspension Systems LLP. As required, consolidated financial statements of the Company and Jai Suspension Systems LLP for the FY 2014-15 are included in the Annual Report.

Court/Tribunal Orders

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.

Management Discussion & Analysis

Management Discussion & Analysis which forms an integral part of this Report provides a detailed analysis on the performance of business and outlook.

Particulars of Loans, Guarantees or Investments

During the year under review the Company has not granted any loan or guarantee to or made any investment in the parties mentioned in Section 186 of the Companies Act, 2013.

Material Changes and Commitment

There were no material changes and commitments affecting the financial position of the Company between the end of FY 2014-2015 i.e. March 31, 2015 and the date of the Report (May 19, 2015).

Particulars of Employees

The disclosures required under Section 197 (12) of the Companies Act, 2013 read with Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel), Rules, 2014 form an integral part of this report and attached as Annexure – I

As per the provisions of Section 136(1) of the Companies Act, 2013, the Report and the Accounts are being sent to all the members of the Company, excluding the information required under Section 197 (12) of the Companies Act, 2013 read with rule 5(2) and 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Any member interested in obtaining such information may write to the Company Secretary at the Registered Office. The said information is also available for inspection at the Registered Office during working hours up to the date of Annual General Meeting.

Directors' Responsibility Statement

In pursuance of Section 134 (3) (c) of Companies Act, 2013, the Directors hereby confirms that:

(a) in preparation of the financial statements, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(b) the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period;

(c) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) the Directors had prepared the annual accounts on a going concern basis; and

(e) the Directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

(f) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Appreciation

The Directors place on record their sincere appreciation to all stakeholders including shareholders, vendors, partners, customers, bankers and financial institutions for their continued support. We also place on record our appreciation for the hard work, harmony and contributions made by employees at all levels.

For and on behalf of the Board

Place: New Delhi (B. S. Jauhar)

Date: May 19, 2015 Chairman


Mar 31, 2014

Dear Members,

The Directors of the company are pleased to present its 48th Annual Report, together with the audited accounts and performance for the year ended 31 March 2014:

Financial Results

Rs. in crore

Particulars Standalone Consolidated Year Year Year Year Ended Ended Ended Ended 31 March 31 March 31 March 31 March 2014 2013 2014 2013

Gross Sales 805 942 894 1056

PBIDT 59 84 67 88

Finance Cost 21 22 24 27

PBDT/Cash Profit 38 62 43 61

Depreciation & others 25 28 26 29

PBT (After Exceptional 13 34 17 32 Items)

Previous year adjustment 1.1 0 1.1 0

Provision for current tax 0.03 - 4 0.09

Provision for Deferred tax -1 4 -1 4

PAT 14 29 14 28

Balance Brought forward -79 -95 -81 -96

Profit available for 14 29 14 28 appropriation

Balance carried to -70 -79 -72 -81 Balance Sheet

Performance

The domestic automobile industry has been witnessing one of the worst recessions in recent times. The automobile industry ended the year 2013-2014 on a decline. Amongst automobile industry segments, the Commercial Vehicle (CV) segment has been the worst affected. The current recession, which began in early 2012 in the Medium and Heavy Commercial Vehicle (M&HCV) segment, has since spread to the Light Commercial Vehicles (LCV) segment too. On YoY basis, the CV industry volumes declined by 20.23% in FY14 against FY13. The company was affected by the slowdown in the CV segment, with the M&HCV sub-segment showing the worst decline in sales and Profits. The M&HCV segment is crucial for the company''s growth.

Industrial output and infrastructure investment are the key factors that affect demand in the CV segment. The slowdown in core industries including cement and steel; and the decline in mining, infrastructure and exports has negatively impacted the CV segment. Poor demand, high discounts and inventory piling have hurt the industry bottom line significantly as have the additional capacities built up by Original Equipment Manufacturers (OEMs).

Against this backdrop of a depressed CV segment, the company achieved total consolidated sales of Rs 894 crore, cash Profit of Rs 43 crore and Profit after tax of Rs 14 crore during FY 2013- 2014 as compared to consolidated sales of Rs 1,056 crore, cash Profit of Rs 61 crore and consolidated Profit after tax of Rs 28 crore in the previous year.

In order to achieve this performance, the company focused its efforts on improving operational efficiencies and cost control, and on easing liquidity pressure. The company rationalized manpower, shut down the Lucknow plant, and sold investment in NHK Springs India Ltd at Profit. Measures adopted for operational efficiencies and cost control have reduced the breakeven level. With this improved financial management, the company was able to maintain robust liquidity even under pressure. During the year under review, the company reduced its short term debt liability by repaying Rs 57.7 crore. In view of the better working capital management and prudent measures undertaken for cost control, the company''s credit rating was duly raised from BB to BBB-.

The company is committed to its long-term plans of expanding the customer and market base, to change product mix by increasing After Market-India/Export share and to reduce the contribution of Tapered Leaf Springs to total revenue. However, on account of the current economic slowdown, some of these plans are likely to be delayed by another year.

With the formation of a stable government at the Centre, the company''s Directors are optimistic of a stable economy in the medium and long-term. The Directors expect the new government to take concrete measures towards development, employment generation and scaling-up the economy. The governments'' promised focus on infrastructure development, GST implementation, FDI, industrial and social reforms is expected to build up confdence in the economy and to create demand. Measures such as expenditure on infrastructure development, increased mining and GST implementation will spur CV demand and contribute to an early recovery.

Your company proposes to pay accumulated dividend of Rs 0.33 crore to IFCI Limited on 12.50% Optionally Convertible Cumulative Preference Shares.

Products

Your company continued its dominance in the market for Tapered and Parabolic Leaf Springs. The sale of your company''s new product, Lift Axles was low as demand for multi-axle vehicles remained weak owing to industry recession, low freight availability and weak sentiments of transporters. Your company has also tied up with Asia Motor Works Ltd for the supply of Lift Axles. Furthermore, your company is at an advanced stage of negotiations with major customers for the supply of Air Suspension.

Market

Jai Suspension Systems LLP, our subsidiary entity, manages our After Market-India/Export operations. Your company has opted to give special attention to its After Market-India/Export operations. Your company has established a wide network of dealers, depots and hubs to meet the After Market demand across the nation. The company is constantly expanding its network to penetrate the After Market-India/Export. During the year, your company closed down two depots and directed supplies to dealers/customers from the hubs. This enabled your company to execute the order more efficiently. Your company has grown in the After Market-India and Export segments by adding new domestic and export customers and markets. As a combined result, the After Market-India/Export sales grew by 21% during the year under review.

During the year your company also increased its share of business with TATA Motors Limited, the largest manufacturer of CVs in India. The increase in share is expected to bring additional volumes in FY 2014-2015 and subsequently.

Capital expenditure

During the year under review, the Company has incurred only need based capital expenditures to conserve cash. The Company has closed down Lucknow Plant as a cost control and rationalization measure.

IPR

Your Company is owner of copyright of more than 60 designs of Leaf and Parabolic Springs. The Company has fled 7 more applications for copyright during the year under review. The patent application of the Company for Indian patent for Air Suspension is pending before the patent authorities.

Dividend

Your directors propose to pay final dividend of Re.1 per equity share.

Human Resource

The relations with employees and associated workforce remained cordial throughout the year.

CSR

Section 135 of Companies Act, 2013 (effective 1 April, 2014) has given statutory strength to the concept of Corporate Social Responsibility. However, your Company was aware of its responsibility towards society much before applicability of Section 135. The Company has been fulfilling the aspiration of society within vicinity of its work units. This has resulted in a harmonious relationship between the Company and community.

Pursuant to the provision of Section 135, the Board of Directors has constituted CSR Committee comprising Mr. Shashi Bansal (Chairman), Mr. R. S. Jauhar and Mr. H. S. Gujral. The CSR

Committee is responsible for formulation and implementation of CSR policies of the Company.

Board Committees

To align with requirement of the Companies Act, 2013 and newly amended Clause 49 of the listing agreement, the Board of Directors has re-organised its committees. Existing Remuneration Committee is re-organised as Nomination & Remuneration Committee, Shareholder Grievance Committee is re-organised as Stakeholders Relationship Committee. Audit Committee has been re-organised to cover the requirement of Companies Act, 2013 and amended Clause 49.

Fixed Deposit

During the period under review, the company has not accepted any public deposits.

Energy, Technology Absorption & Foreign Exchange

The particulars as prescribed under Section 217 (1) (e) of the Companies Act, 1956, read with the Companies (Disclosures of particulars in the Report of the Board of Directors) Rules, 1988 form an integral part of this report.

Particulars of Employees

As per the provisions of Section 219 (1) (b) (iv) of the Companies Act, 1956, the Report and the Accounts are being sent to all the members of the company, excluding the information required under Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975. Any member interested in obtaining such information may write to the Company Secretary at the Registered office. The said information is also available for inspection at the Corporate office during working hours up to the date of Annual General Meeting.

Directors

Section 149, 150 and 152 of the Companies Act, 2013 (effective 1 April, 2014) provides for the appointment and term of office of independent directors. Independent director can be appointed for a term of up to five consecutive years and shall be eligible for re-appointment for further term upto five consecutive years by passing of a special resolution by the company. Any tenure of an independent director on the date of commencement of Companies Act, 2013 shall not be counted as a term under the Act. Section 149(13) states that provisions related to retirement of directors by rotation shall not be applicable to independent director.

All the independent directors of the Company were appointed as director liable to retire by rotation under the erstwhile Companies Act, 1956. Therefore to comply with the provisions of the Companies Act, 2013 related to independent director proposals for fresh appointment of all the independent directors i.e. Mr. J. K. Jain, Mr. C. K. Vohra, Mr. U. K. Singhal, Mr. Shashi Bansal and Seth Ashok Kumar are being placed for consideration of the members at the coming Annual General Meeting.

In accordance with Section 152 and other applicable provisions of the Companies Act, 2013, Mr. B. S. Jauhar and Mr. H. S. Gujral retire by rotation at the ensuing Annual General Meeting and, being eligible, offer themselves for re-appointment. In order to comply with the provisions of Section 152(6) of the Companies Act, 2013 related to retirement of directors by rotation, proposal to make office of Mr. P. S. Jauhar liable to be determined by retirement of directors by rotation is being placed for consideration of the members at the coming Annual General Meeting.

Board of Directors at their meeting held on 13 November 2013 re- appointed Mr. Randeep Singh Jauhar as CEO & Executive Director for a period of three years with effect from 1 January 2014 to 31 December, 2016. A proposal for re-appointment of Mr. R. S. Jauhar as CEO & Executive Director is being placed for the consideration of members at the coming Annual General Meeting.

Statutory Auditors

The Statutory Auditors have reported that some discrepancies were noted on physical verifcation of inventories. During the year, Company has carried out a detailed exercise to identify stock which in the opinion of management was not ft for producing quality products. Accordingly, such material was disposed off at net realizable value.

The Statutory Auditors have also drawn attention to note no. 44 of financial statement that remuneration has been paid to whole time directors in excess of permissible remuneration under the Companies Act, 1956. The Company is in the process of fling applications with Central Government for approval of payment of excess remuneration to two whole time directors. The directors have also confirmed to refund to Company excess remuneration in the event Central Government refuses to grant its approval.

The present Statutory Auditors i.e. M/s S. R. Batliboi & Co; LLP Chartered Accountants, has confirmed their eligibility and willingness to act as Statutory Auditors of the company, if re-appointed at the coming annual general meeting. Directors recommend the appointment of M/s S. R. Batliboi & Co; LLP, Chartered Accountants as Statutory Auditors at the coming Annual General Meeting.

The report of the statutory auditors read with the notes on accounts being self-explanatory, needs no further clarifcation.

Cost Auditors

Pursuant to Section 148 of the Companies Act, 2013, M/s Goyal Goyal & Associates, Cost Accountants and M/s Vijender Sharma & Co., Cost Accountants are proposed to be re-appointed for the financial year ending on 31 March 2015.

Internal Auditors

M/s K. Khanna & Co., Chartered Accountants are the internal auditors of the company. The internal auditors independently evaluate the adequacy of internal controls and concurrently audit the majority of transactions in value terms. Independence of audit and compliance is ensured by submitting the report of internal audit to the Audit Committee of the Board.

To ensure reliability of financial reporting and safeguarding of the assets internal control systems, accounting and procedural controls are established in the organization. The company endeavours to continuously strengthen such procedures and controls.

Subsidiary Entity

The Company is majority partner is Jai Suspension Systems LLP. As required, consolidated financial statements of the Company and Jai Suspension Systems LLP for the financial year 2013-14 are included in the Annual Report.

Corporate Governance

The Company is in compliance with requirements of corporate governance mentioned in Clause 49 of listing agreement. The Company has documented insider trading code and code of conduct as part of internal policies. Company''s corporate governance report along with certificate of compliance forms part of Annual Report.

Directors'' Responsibility Statement as required under Section 217(2AA) of the erstwhile Companies Act, 1956

Annual Accounts for the financial year ended 31 March 2014 have been prepared on a going concern basis. Annual Accounts are in conformity with requirements of Accounting Standards issued by the Institute of Chartered Accountants of India and no material departure from same has been made. In preparation of the annual accounts such accounting policies have been selected and consistently applied, judgments and estimates made that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of financial year 2013-2014 and of the Profit of the Company for that period. The Board of Directors has taken proper and suffcient care to maintain adequate accounting records in accordance with provisions of the Companies Act, 1956, to safeguard assets of the Company and to prevent & detect fraud and other irregularities.

Appreciation

The Directors place on record their sincere appreciation to all stakeholders including shareholders, vendors, partners, customers, bankers and financial institutions for their continued support. We also place on record our appreciation for the hard work, harmony and contributions made by employees at all levels.

For and on behalf of the Board

Place: New Delhi (B. S. Jauhar)

Date: May 29, 2014 Chairman


Mar 31, 2013

Dear Members,

The Directors of the Company are pleased to present the 47th Annual Report, together with the audited accounts and performance for the year ended 31 March 2013:

Financial Results:

(Rs. in crore)

Standalone Consolidated Year Ended Year Ended Year Ended Year Ended 31 March 31 March 31 March 31 March 2013 2012 2013 2012

Gross Sales 942 1,065 1,056 1,204

PBIDT 84 102 88 106

Finance cost 22 16 27 19

PBDT /Cash Profit 62 86 61 87

Depreciation & others 28 32 29 32

PBT 34 54 32 55

Previous year adjustment - 2 - 3.5

Provision for current tax - - 0.09 0.08

Provision for deferred tax 4 9 4 9

PAT 29 43 28 42

Balance brought forward (95) (113) (96) (113)

Proft available for 29 43 28 42 appropriation

Balance carried to (79) (95) (81) (96) Balance Sheet

Performance:

Weak macro factors and slowing industrial growth has adversely impacted the Commercial Vehicles (CV) industry in the year under review. Segment wise, Light Commercial Vehicles (LCV) segment has sustained growth momentum, whereas Medium & Heavy Commercial Vehicles (M&HCV) segment has shrunk. Your Company is a major player in CV industry having signifcant interest in M&HCV segment; accordingly it is also afected by the overall slowdown in the industry.

After witnessing a volume growth of 30% during FY 2009-10 and 2010-11, buoyancy in the domestic CV industry has been subdued since second half of 2011-12. LCV segment has made good start and sustained momentum of 14% growth. More models in this segment are expected to be introduced in the market in the medium term. M&HCV segment is worst afected by the slowdown, witnessing negative growth. Within the segment though demand for buses was not afected much due to STU orders, the drop in demand for trucks, trailers and multi axle vehicle was the sharpest. There was not much capacity expansion by the vehicle manufacturers in the CV segment.

The Company has signifcant interest in M&HCV segment of the CV industry and essentially depends upon the growth of M&HCV segment. In view of weak economic scenario and slowdown in CV industry, the Company has actively pursued plans to expand customer & market base, change in product mix to increase After Market India/Export share and reduce the share of tapered leaf springs to total revenue and has made progress in all these plans. As a result, the Company has achieved total consolidated sales of Rs.1,056 crore during FY 2012-2013 as compared to consolidated sales of Rs.1,204 crore in the previous year in spite of negative growth in the M&HCV segment. Total consolidated cash proft of Rs.61 crore and consolidated proft after tax of Rs.28 crore was earned during the FY 2012-2013 as against the consolidated cash proft of Rs.87 crore and proft after tax of Rs.42 crore in previous year. The loss of OEM sales owing to negative growth of M&HCV segment has been partially compensated by After Market India/Export growth and improved Share of Business in LCV segment.

Your Company is proposing to pay fnal dividend of Rs.2 per equity share and has also proposed to pay accumulated dividend of Rs.43,75,000 to IFCI Limited on 12.50% Optionally Convertible Cumulative Preference Shares.

Product:

During the year under review, the Company has launched lift axles and air-suspension products. The Company has started supply of lift axles to Ashok Leyland Limited and has been awarded by Silver Award for best in class performance in RAMP UP in development and producing lift axles. Jamshedpur plant of your Company has also received Certifcate of Excellence Award from Tata Motors Limited for supply of quality products and approach towards continual improvement in quality.

Your Company is at an advance stage of working with other major customers for supply of lift axles and has also started making supplies of air suspension to SML Isuzu Limited for low foor buses. We are happy to inform that as a part of strategy, the share of parabolic springs grew by 10% during the period under review.

Market:

As part of de-risking strategy, the Company is aiming to tap new markets. Our After Market operations are looked after by our subsidiary entity, Jai Suspension Systems LLP. Your Company is constantly adding dealers to penetrate the After Market. During the year under review three new hubs at Chennai, Nagpur and Jamshedpur were established in addition to existing hub at Pant Nagar. These hubs store entire range of the Company''s product to feed the dealers and depots across the country. This has improved the Company''s ability to reach customers across the nation. We are happy to inform that After Market sales grew by 44% during the year under review.

Locations:

The expansion at Malanpur (Madhya Pradesh) is complete. The expansion will enable the Company to diversify the sales mix, improve proftability and facilitate the growth in the After Market India/Export.

IPR:

Your Company is owner of copyright of more than 60 designs of Tapered Leaf and Parabolic Springs. The patent application for Indian patent for Air Suspension is pending before the patent authorities.

Dividend:

Directors are pleased to recommend a fnal dividend of Rs.2 on the equity shares of Rs.10 each out of the profts for the fnancial year ending 31 March 2013. The Company proposes to transfer Rs.2.91 crore to the General Reserves.

Human Resource:

Your Company made signifcant progress in people development and processes during the year under review.

SAP (HCM) implementation Phase I (Organizational Management, Personnel Administration, Payroll and Time Management) was completed successfully across the Company. The implementation makes integrated information available at any location pertaining to people and deliver through standard processes irrespective of location.

Internal development and attraction of high quality talent has been the prime focus during the year. High performing professionals with established background were appointed at senior leadership levels. Graduate Engineering Trainee scheme was launched at one manufacturing unit as a pilot. Fresh graduate engineers are under training in accordance with a year long structured internal training program.

Performance Management System was revamped to reward the performance culture and is being further upgraded.

Relations with employees and associated workforce remained cordial throughout the year.

Fixed Deposit:

During the period under review, the Company has not accepted any public deposits.

Energy, Technology Absorption & Foreign Exchange:

The particulars as prescribed under Section 217 (1) (e) of the Companies Act, 1956, read with the Companies (Disclosures of particulars in the Report of the Board of Directors) Rules, 1988, are set out in Annexure ''A'' and form an integral part of this report.

Particulars of Employees:

As per the provisions of Section 219 (1) (b) (iv) of the Companies Act, 1956, the Report and the Accounts are being sent to all the members of the Company, excluding the information required under Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended. Any member interested in obtaining such information may write to the Company Secretary at the Registered Ofce. The said information is also available for inspection at the Registered Ofce during working hours up to the date of Annual General Meeting.

Directors:

Mr. V. Subramanian was appointed as nominee director of IFCI Ltd. on the Board of Directors of the Company in place of Mr. D. K. Jain. The Board places on record its appreciation for the valuable contribution made by Mr. Jain during his tenure as director of the Company.

Mr. S. P. S. Kohli, President & Executive Director has resigned from the services of the Company. The Board places on record its appreciation for the valuable contribution made by Mr. Kohli during his tenure with the Company.

In accordance with the applicable provisions, Mr. J. K. Jain, Mr. Shashi Bansal and Seth Ashok Kumar retire by rotation at the ensuing Annual General Meeting and being eligible, ofer themselves for re-appointment.

Proposals for change in remuneration of Mr. R. S. Jauhar as CEO & Executive Director, reappointment of Mr. P. S. Jauhar as COO & Executive Director and appointment of Mr. H. S. Gujral as Executive Director are being placed for the consideration of members at the coming Annual General Meeting.

Statutory Auditors:

The Statutory Auditors have reported delay in repayment of dues to banks and fnancial institutions. These delays occurred mainly due to temporary liquidity problem. Further, steps have been taken to ensure repayment of dues on time and there has been no delay since January, 2013. In view of the timely repayments, ICRA has revised the ratings of the Company for Lines of Credit from ICRA D to ICRA BBB- (Stable) and Short term bank facilities from ICRA D to ICRA A3.

The auditors have also observed that the Company used short term funds of Rs.35.81 crore for long term investment. The Company has infused long term funds of Rs.25.50 crore by way of liquidation of investments during frst quarter of the current fnancial year to correct this gap. In addition, cash generation from operations during frst quarter of the current fnancial year is higher than capital expenditure and term loan repayments and the same has been deployed in working capital.

The Statutory Auditors have, in their report, mentioned about delays in deposit of statutory dues in few cases. We may mention here that these delays were due to oversight and purely unintentional. We are implementing corrective actions to ensure such delays do not occur again. In addition, we are also training and sensitizing our employees at working level for compliances/ timely deposits.

The Statutory Auditors have, in their report, mentioned about one instance of an attempted fraud on the Company by a job worker. This has happened purely during the course of commercial dealing with the vendor having long term relationship. This risk has been fully provided in FY 2012-13.

The report of the statutory auditors read with the notes on accounts being self-explanatory, needs no further clarifcation.

The present Statutory Auditors i.e., M/s B. S. R. & Co; Chartered Accountants have expressed their un-willingness to continue as Statutory Auditors of the company. In view of the above, directors recommend appointment of M/s S. R. Batliboi & Co. LLP, Chartered Accountants as Statutory Auditors of the Company at the ensuing Annual General Meeting. M/s S. R. Batliboi & Co. LLP, Chartered Accountants have confrmed their eligibility and willingness to act as Statutory Auditors of the company, if appointed. The directors place on record their appreciation for the outgoing auditors'' cooperation and support.

Cost Auditors:

Pursuant to the cost audit orders issued by the Ministry of Corporate Afairs (MCA) under Section 233B of the Companies Act, 1956, M/s GoyalGoyal & Associates, Cost Accountants and M/s Vijender Sharma & Co; Cost Accountants were re-appointed for the fnancial year ended on 31 March 2013. The Cost Audit Reports for the fnancial year ended 31 March 2012 were duly fled with the MCA.

Internal Auditors:

M/s K. Khanna & Co., Chartered Accountants are the internal auditors of the Company. The internal auditors independently evaluate the adequacy of internal controls and concurrently audit the majority of transactions in value terms. Independence of audit and compliance is ensured by submitting the report of internal audit to the Audit Committee of the Board.

To ensure reliability of fnancial reporting and safeguarding of the assets internal control systems, accounting and procedural controls are established in the organization. The Company endeavours to continuously strengthen such procedures and controls.

Consolidated Financial Statements:

Consolidated Financial Statements of the Company and Jai Suspension Systems LLP for the fnancial year 2012-13 have been included in the Annual Report in compliance with the Accounting Standard 21. The Company is the majority partner in the partnership frm.

Report on Corporate Governance:

Pursuant to clause 49 of the Listing Agreement, a report on Corporate Governance alongwith the Certifcate of Compliance with the conditions of the corporate governance is given and forms part of this report.

Directors'' Responsibility Statement:

Pursuant to the requirement under Section 217 (2AA) of the Companies Act, 1956 with respect to the Directors'' Responsibilities Statement, the directors confrm that:

(a) The Annual Accounts for the fnancial year ended 31 March 2013 are in conformity with the requirements of the Accounting Standards issued by the Institute of Chartered Accountants of India and no material departure from the same have been made;

(b) Such Accounting Policies have been selected and consistently applied and judgments and estimates made that were reasonable and prudent so as to give a true and fair view of the state of afairs of the Company at the end of fnancial year 2012-2013 and of the proft or loss of the Company for that period;

(c) Proper and sufcient care was taken for maintenance of adequate accounting records maintained in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing & detecting any form of fraud and other irregularities;

(d) The Annual Accounts for the fnancial year ended 31 March 2013 have been prepared on a going concern basis.

Appreciation:

The Directors place on record their sincere appreciation to all the shareholders, partners, customers and employees who remain the centre of our focus. We also place on record our appreciation for the contributions made by employees at all levels, bankers and fnancial institutions.

For and on behalf of the Board



Place: New Delhi (B. S. Jauhar)

Date: 13 August 2013 Chairman


Mar 31, 2012

The Directors of the Company are pleased to present the 46th Annual Report, together with the audited accounts and performance for the year ended 31 March 2012:

Financial Results:

(Rs in crore) Standalone Consolidated year year year year

Gross Sales 1064.59 8e9.65 1204.27 997.98

PBIDT 101.71 100.25 105.69 108.21

Finance cost 16.00 20.55 18.82 21.70

PBDT /cash Profit 85.71 79.70 86.87 86.51

Depreciation & others 33.96 24.36 35.65 32.06

PBT 51.75 55.33 51.22 54.45

Provision for current tax - 0.01 0.08 4.30

Provision for deferred tax 8.91 12.59 8.95 12.70

pat 42.84 42.73 42.19 37.45

Previous year adjustment - 0.25 - 0.25

Balance brought forward (19.10) (48.78) (19.10) (44.05)

Profit available for appropriation 42.84 42.48 42.19 37.20

Balance carried to Balance (1.59) (19.10) (2.23) (19.10) Sheet

Performance:

Directors are happy to inform that during the year under review, the Company, maintaining its leadership position, crossed the landmark Rs1000 crore turnover. Its consolidated turnover stood at Rs1204 crore as against Rs998 crore in 2010-2011. Consolidated profit after tax for 2011-2012 is Rs42.19 crore compared to Rs37.20 crore in 2010-2011.

The Company has paid interim dividend of Rs1 per share twice during the year under review and is proposing to pay final dividend of Rs1.50 per equity share. The Company is proposing to pay accumulated dividend of Rs4.32 crore up to 31 March 2012 to IFCI Limited on 12.50% Optionally Convertible Cumulative Preference Shares.

In our last annual report, we had stated that the Company would actively pursue broad three objectives - increase in product range, add new markets and enhance shareholders' value. We are glad to inform that the Company has made significant progress in all the three areas.

Product:

As mentioned above, the Company's plans for launch of lift axles and air-suspension is going as per schedule. As part of our strategy, we intend to bring down the share of conventional spring to 65% by FY2015. We are happy to inform that during the year under review sales of parabolic springs grew by 31%. The Company has tied up with Ashok Leyland Limited for supply of lift axles for its commercial vehicles.

Market:

As part of de-risking strategy, the Company has been aggressively trying to penetrate the After Market - India/ Exports. The domestic After Market sale is being spearheaded by Jai Suspension Systems LLP in which the Company is a major partner. We are aiming at minimum 33% turnover from the After Market - India/Exports segment by 2015. We are happy to inform that our efforts in this direction have started yielding results. The After Market - India/Exports sales grew by 37% in 2011-12.

Locations:

The expansion plan at Yamuna Nagar (Haryana) is complete and Malanpur (Madhya Pradesh) is going on and will be completed in September 2012. The Hosur Plant was completed in June 2012.

During the year under review the Company purchased land in Pune for setting up facility for manufacturing of springs and additional land in Malanpur and Yamuna Nagar for expansion.

Patent application:

Patent application filed by the Company for patent in India in respect of its Air Suspension is pending before the authorities. The Company is the owner of copyright of more than 45 designs of Leaf and Parabolic Springs.

Dividend:

During the F.Y. 2011-2012 the Company has paid an interim dividend of Rs1 per equity share two times.

Directors are pleased to recommend a final dividend of Rs1.50 on the equity shares of Rs10 each out of the profits for the financial year ending 31 March 2012 in addition to the two interim dividends. The total dividend payout for the year would be 35%. The Company proposes to transfer Rs428.41 lacs to the general reserve.

Human Resource:

Employees and workers continue to be the mainstay of the Company's success as is evident from the performance of 2011-12. As the Company has grown in size and location, we have strengthened the H R set up in the Company to fulfill the aspirations of a growing number of professionals. Training of workers and employees continued to receive high priority. The Company has engaged the world renowned Japan Institute of Total Process Innovation (JITPI) for training of technical team in manufacturing system and total productivity management. We have already mentioned that a number of employees (from senior management level to workers level) have been given the Stock Option. The Company has issued ESOPs constituting 3.92% of its equity capital to the employees till date. The particulars of options issued, as required by SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, are appended as 'Annexure B' and form part of this Report.

Internal Control Systems:

The Company has been continuously strengthening the internal control systems, accounting and procedural controls aimed to ensure reliability of financial reporting.

Internal auditors i.e. M/s K. Khanna & Co., Chartered Accountants, also evaluate the adequacy of internal controls and concurrently audit the majority of transactions in value terms. The reports of the internal auditors are placed before the Audit Committee.

Fixed Deposit:

During the period under review, the Company has not accepted any public deposits.

Energy, Technology Absorption & Foreign Exchange:

The particulars as prescribed under Section 217 (1) (e) of the Companies Act, 1956, read with the Companies (Disclosures of particulars in the Report of the Board of Directors) Rules, 1988, are set out in Annexure 'A' and form an integral part of this report.

Particulars of Employees:

Mr. R. S. Jauhar and Mr. P. S. Jauhar fall under the purview of Section 217 (2A) of the Companies Act, 1956. However, as per the provisions of Section 219 (b) (iv) of the Companies Act, 1956, the Report and the Accounts are being sent to all the members of the Company, excluding the information required under Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended. Any member interested in obtaining such information may write to the Company Secretary at the Registered Office.

The said information is also available for inspection at the Corporate Office during working hours up to the date of Annual General Meeting.

Directors:

During the year Mr. S. P. S. Kohli was re-appointed as President & Executive Director of the Company for a period of 3 years w.e.f. 23 October 2011. Proposal for his re-appointment as President & Executive Director for a further period of 3 years w.e.f. 23 October 2011 is being placed for the consideration of members at the coming annual general meeting.

During the year Mr. Robert Dean Petty ceased to be the director due to repayment of loan of Clearwater Capital Partners India Pvt. Limited. The Board places on record its deep appreciation of the valuable services rendered by him during his tenure as Director.

In accordance with the applicable provisions, Mr. C. K. Vohra, Mr. U. K. Singhal and Mr. P. S. Jauhar retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment.

The Company has received a notice in writing from a member of the Company under Section 257 of the Companies Act, 1956 proposing the candidature of Mr. J. K. Jain as director of the Company in the coming annual general meeting.

A brief of their profiles is also provided in the notice convening the Annual General Meeting.

Auditors:

The Statutory Auditors have, in their report, mentioned about delays in deposit of statutory dues in few cases. We may mention here that these were few stray cases and there was no amount outstanding as on 31 March 2012. Steps have been taken to ensure such delays do not occur again.

The Statutory Auditors have reported delay in repayment of dues to banks and financial institutions. The management has taken the note of same and will ensure that it does not re-occur. Further there was no amount outstanding as on 31 March 2012.

The auditors have also observed that the company used short term funds of Rs35.81 crore for long term investment. We would like to inform that the company is managing its working capital cycle very efficiently and is fully conscious of judicious deployment of funds for long term and short term usage in the company's operations.

The present Statutory Auditors i.e. M/s B. S. R. & Co. Chartered Accountants, has confirmed their eligibility and willingness to act as Statutory Auditors of the Company, if appointed at the coming annual general meeting. Directors recommend M/s B. S. R. & Co; Chartered Accountants may be appointed as Statutory Auditors at the coming Annual General Meeting.

Pursuant to the cost audit orders issued by the Ministry of Corporate Affairs (MCA), vide its notification No. 52/26/CAB- 2010 dated 30 June 2011, the cost audit is applicable to the company from the financial year 2011-2012. The company has appointed M/s Goyal Goyal & Associates and M/s Vijender Sharma & Co; as the cost auditor. Report of cost auditors for the financial year 2011-2012 is to be filed with the Central Government by 30 September 2012 . Following are the details of the cost auditors:

M/s Vijender Sharma & Co 11, 3rd Floor, Hargovind Enclave,

VikasMarg, New Delhi- 110 092 Membership No.: M18513

M/s GoyalGoyal& Associates

K-81A, Lajpat Nagar-II, New Delhi- 110 024

Membership No.: 00100

Consolidated Financial Statements:

Consolidated Financial Statements of the Company and Jai Suspension Systems LLP for the financial year 2011-12 have been included in the Annual Report in compliance with the Accounting Standard 21. The Company is the majority partner in the partnership firm.

Report on Corporate Governance:

Pursuant to clause 49 of the Listing Agreement, a report on Corporate Governance is given in Annexure 'C' and forms part of this report.

Directors' Responsibility Statement:

Pursuant to the requirement under Section 217 (2AA) of the Companies Act, 1956 with respect to the Directors' Responsibilities Statement, the directors confirm that:

(a) The Annual Accounts for the financial year ended 31st March 2012 are in conformity with the requirements of the Accounting Standards issued by the Institute of Chartered Accountants of India and no material departure from the same have been made;

(b) Such Accounting Policies have been selected and consistently applied and judgments and estimates made that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of financial year 2011-12 and of the profit or loss of the Company for that period;

(c) Proper and sufficient care was taken for maintenance of adequate accounting records maintained in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing & detecting any form of fraud and other irregularities;

(d) The Annual Accounts for the financial year ended 31 March 2012 have been prepared on a going concern basis.

Appreciation:

Our shareholders, partners, customers and employees remain the centre of our focus. Our endeavor is to continue our efforts in value maximization, encouraging transparency and effective communication with all the stakeholders.

We also place on record our appreciation for the contributions made by employees at all levels, bankers and financial institutions.

For and on behalf of the Board

Place: New Delhi (B. S. JAUHAR)

Date: 7 June, 2012 Chairman


Mar 31, 2011

Dear Member,

The Directors of the company are pleased to present the 45th Annual Report, together with the audited accounts and performance for the year ended 31 March 2011:

Financial Results

(Rs. in crore)

Consolidated Standalone Year Year Year Year ended ended ended ended 31 March 31 March 31 March 31 March 2011 2010 2011 2010

Gross Sales 997.99 661.48 905.06 606.03

PBIDT 108.22 79.80 100.26 71.33

Finance Cost 21.48 26.171 20.35 25.62

PBDT/Cash Profit 86.74 53.631 79.91 45.70

Depreciation & Others 32.23 29.02 24.66 24.24

PBT 54.51 24.61 55.25 21.46

Provision for Current Tax 4.31 0.10 0.01 0.01

Provision for Deferred 12.70 5.40 12.59 5.57

Tax

PAT 37.50 19.11 42.65 15.88

Previous Year Adjustment 0.30 8.07 0.17 8.11

Balance Brought Forward (44.05) (52.73) (48.78) (56.56)

Profit Available for 24.95 8.68 29.68 7.77

Appropriation_

Balance Carried to (19.10) (44.05) (19.10) (48.78)

Balance Sheet

Performance

The company recorded its highest turnover during the FY 2010-11 and maintained its leadership position in the leaf spring industry. Consolidated sale during the year under review was Rs.998 crore as against Rs.661 crore during the FY. 2009- 10. Consolidated net profit for the FY 2010-11 is Rs.37 crore as compared to Rs.19 crore during the FY 2009-10.

During the year the company made preferential issue of 2631578 equity shares to Clearwater Capital Partners Singapore Fund III Pvt Ltd and the promoters. The entire preferential issue proceed of Rs.25 crore was utilized to prepay high cost term loans. This along with ploughing back of profits has reduced the total debt of the company from Rs.119 crore as on 31 March 2010, to Rs.66 crore as on 31 March 2011. The company brought down its finance cost to 2% of sales against 4% of sales during FY 2009-10. During the year under review, debt reduction improved debt/equity ratio from 1.45 to 0.50 and also brought down the breakeven point. The company is committed to improve the shareholders wealth by improving its margins and return on capital employed from current level of 44% and emerge financially strong to enable it to withstand any future shock of recessionary or slowdown trend in the economy.

Increase in prices of raw material, power and oil and other commodities had put pressure on the margins. However, the company improved efficiency in its operation with value addition and higher sales, reduced finance cost. Consolidated PBT increased from Rs.25 crore to Rs.55 crore and consolidated PAT increased from Rs.19 crore to Rs.37 crore. Inflationary trends continue to cause worries which have led to hardening of interest rates and are bound to leave its impact on the overall growth of the economy. The GDP growth forecast of 8-9% during 2011- 12 onwards may not be sustainable if inflation is not controlled. Hike in oil prices will also have its impact in the overall growth. The company is improving efficiency in its operation to contain cost and has gone for energy efficient equipment as part of its expansion and technology upgradation.

The company shared its earnings with the shareholders and paid an interim dividend of Rs.1 per equity share during the FY 2010-11 and also proposing to pay final dividend of Rs.1 per equity share.

During the year under review, the company's wholly owned subsidiary i.e. Jai Suspension Systems Limited was converted into a Limited Liability Partnership Firm. The company is the majority partner in the partnership firm having 99.9975% share.

Product

The company is India's largest and among the world's top 3 leaf and parabolic springs manufacturer for commercial vehicles (CVs). The current product range of the company comprises leaf and parabolic springs. The leaf spring has major share in the product mix of the company. However, as planned share of parabolic springs in the product mix increased from 8% to 10% during the FY 2009-10.

Going up the value chain, the company acquired land in Chennai to set up a plant to manufacture Air Suspension and Lift Axle. Air Suspension and Lift Axle will be made in technical collaboration with Ridewell Corporation, a leading suspension manufacturer in USA. Prototypes of Air Suspension and Lift Axle developed are undergoing rigorous trial.

After the completion of the company's expansion plans the company will add, Air Suspension and Lift Axles in its product mix besides the existing range of leaf springs, light and heavy parabolic springs. The company is focused in its plans of product and market diversification and to emerge as a strong player in the CV segment.

Market

OEM India continued to be the major customers of the company and constitute 90% of the turnover.

After Market segment constitute 9% of the turnover. The company considers the growing domestic and export After Market and OEM exports an important tool of its de-risking strategy and increase its footprint in this segment.

Locations

The manufacturing facilities of the company are located at Yamuna Nagar (Haryana), Chennai (Tamil Nadu), Malanpur (Madhya Pradesh) and Jamshedpur (Jharkhand). Further, Jai Suspension Systems LLP, has its Plant at Pant Nagar (Uttarakhand). Considering the robust demand building up from the existing players as well as the new entrants, the company has undertaken expansion at its Yamuna Nagar and Malanpur plants. The company has acquired additional land for expansion of its existing plant at Malanpur. The Jamshedpur plant commenced commercial production from October 2010. Lucknow Plant has also been set up during the year.

The company has completed the land acquisition for its seventh plant at Hosur (Tamil Nadu).

Domestic After Market operations are being spearheaded by the company's subsidiary - Jai Suspension Systems LLP. The company has pan India after market network of 18 depots and 1100 dealers. After completion of the expansion plans, the company will have presence at Yamuna Nagar, two plants at Chennai, Malanpur, Jamshedpur, Lucknow, Hosur and Pant Nagar (Subsidiary).

Patent Application

The company has filed final Patent application for patent in India in respect of its Air Suspension. The company is the owner of copyright of more than 45 designs of Leaf and Parabolic Springs.

Listing of Shares at NSE

From 10 December 2010, equity shares of the company are listed at NSE. The scrip code of the shares at NSE is "JAMNAAUTO" and BSE is 520071

Dividend

During the FY 2010-11 the company has paid an interim dividend of Rs.1 per equity share.

Directors are pleased to propose a final dividend of Rs.1 on the equity shares of Rs.10 each out of the profits for the financial

year ending 31 March 2011 in addition to the interim dividend.

Human Resource

Success of any organisation depends entirely upon the quality of its employees. The company takes pride in its employees' dedication and commitment which is evident from its performance of 2010-11. As the company grows in size and locations, it is extremely important to manage the aspirations of a growing number of professionals. The company is committed to bring in the best H R practices to ensure employee retention. An in-house training department has been set up for raising the skill sets of workers and employees. As we have committed to increase shareholders' wealth, similarly we want to create wealth for our employees as well through the Employees Stock Option Scheme (ESOPs). The company issued ESOPs constituting 3.92% of its equity capital to the employees during the year. The particulars of options issued, as required by SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, are appended as 'Annexure B' and form part of this Report.

Internal Control Systems

M/s K. Khanna & Co., Chartered Accountants are the internal auditors of the company. The internal auditors independently evaluate the adequacy of internal controls and concurrently audit majority of the transactions in value terms. The report of the internal auditors is placed before the Audit Committee.

SAP Implementation

During the year 2010-11, SAP has been implemented in the company's Corporate Office and Chennai Plant. SAP has been successfully running in Malanpur Plant since 2008.

Fixed Deposit

During the period under review, the company has not accepted any public deposits.

Energy, Technology Absorption & Foreign Exchange

The particulars as prescribed under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosures of Particulars in the Report of the Board of Directors) Rules, 1988, are set out in 'Annexure A' and form an integral part of this Report.

Particulars of Employees

Mr. R. S. Jauhar, Mr. P. S. Jauhar and Mr. S. P. S. Kohli fall under the purview of Section 217(2A) of the Companies Act, 1956. However, as per the provisions of Section 219(b)(iv) of the Companies Act, 1956, the Report and the Accounts are being sent to all the members of the company, excluding the information required under Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended. Any member interested in obtaining

such information may write to the Company Secretary at the Registered Office. The said information is also available for inspection at the Corporate Office during working hours up to the date of Annual General Meeting.

Directors

During the year Mr. R. S. Jauhar was re-appointed as CEO & Executive Director of the company for a period of 3 years w.e.f. 1 January 2011. In accordance with the applicable provisions, Mr. B. S. Jauhar, Mr. Shashi Bansal and Seth Ashok Kumar retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. A brief of their profiles is also provided in the notice convening the Annual General Meeting.

Auditors

The report of the Statutory Auditors, read with the notes on accounts being self-explanatory, needs no further clarification.

The present Statutory Auditors i.e., M/s Goel Garg & Co., Chartered Accountants, M/s A. K. Kalia & Associates, Chartered Accountants and M/s A. S. G. & Associates, Chartered Accountants have expressed their inability to continue as Statutory Auditors of the company. In view of the above, directors recommend M/s B. S. R. & Co; Chartered Accountants may be appointed as Statutory Auditors of the company at the forthcoming Annual General Meeting. M/s B. S. R. & Co; Chartered Accountants has confirmed their eligibility and willingness to act as Statutory Auditors of the company, if appointed. The directors place on record their appreciation for the outgoing auditors' cooperation and support.

Consolidated Financial Statements

The company had converted its wholly owned subsidiary Jai Suspension Systems Limited into a Limited Liability Partnership Firm. It has become a Limited Liability Partnership firm with effect from 21 October 2010. The company is the majority partner in the partnership firm.

Consolidated Financial Statements of the company and Jai Suspension Systems LLP for the financial year 2010-11 have been included in the Annual Report in compliance with the Accounting Standard 21.

Report on Corporate Governance

Pursuant to clause 49 of the Listing Agreement, a report on Corporate Governance is given in 'Annexure B' and forms part of this Report.

Directors' Responsibility Statement

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956 with respect to the Directors' Responsibilities Statement, the directors confirm that:

(a) The Annual Accounts for the financial year ended 31 March 2011 are in conformity with the requirements of the Accounting Standards issued by the Institute of Chartered Accountants of India and no material departure from the same have been made;

(b) Such Accounting Policies have been selected and consistently applied and judgments and estimates made that were reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of financial year 2010-11 and of the profit or loss of the company for that period;

(c) Proper and sufficient care was taken for maintenance of adequate accounting records maintained in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing & detecting any form of fraud and other irregularities;

(d) The Annual Accounts for the financial year ended 31 March 2011 have been prepared on a going concern basis.

Appreciation

Our shareholders, partners, customers and employees remain the centre of our focus. Our endeavour is to continue our efforts in value maximization, encouraging transparency and effective communication with all the stakeholders.

We also place on record our appreciation for the contributions made by the shareholders, customers, employees, bankers and financial institutions.

For and on behalf of the Board

Place : New Delhi B. S. Jauhar Date : 11 July 2011 Chairman





 
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