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Directors Report of Maruti Suzuki India Ltd.

Mar 31, 2015

Dear Members,

The directors have pleasure in presenting the 34th annual report together with the audited financial statements for the year ended 31st March 2015.

FINANCIAL RESULTS

The Company's financial performance during the year 2014-15 as compared to the previous year 2013-14 is summarised below:

( Rs. in million)

Total revenue 508,022 445,235

Profit before tax 48,682 36,585

Tax expense 11,570 8,755

Profit after tax 37,112 27,830

Balance brought forward 173,849 153,043

Impact of revision of useful lives of certain fixed assets (792) -

Profit available for appropriation 210,169 180,873

Appropriations:

General reserve 3,711 2,783

Proposed dividend 7,552 3,625

Corporate dividend tax 1,538 616

Balance carried forward to balance sheet 197,368 173,849

FINANCIAL HIGHLIGHTS

The total revenue (net of excise) was Rs. 508,022 million as against Rs. 445,235 million in the previous year showing an increase of 14 per cent. Sale of vehicles in the domestic market was 1,170,702 units as compared to 1,053,689 units in the previous year showing an increase of 11 per cent. Total number of vehicles exported was 121,713 units as compared to 101,352 units in the previous year showing an increase of 20 percent.

Profit before tax (PBT) was Rs. 48,682 million against Rs. 36,585 million showing an increase of 33 per cent and profit after tax (PAT) stood at Rs. 37,112 million against Rs. 27,830 million in the previous year showing an increase of 33 per cent. Price earning ratio (based on last quoted price on NSE) as on 31st March 2014 and 31st March 2015 was 21.40 and 30.10 respectively.

The Government of India came out with an 'offer for sale' at a price of Rs. 125/- per share in 2003. The market capitalisation as on 31st March 2014 and 31st March 2015 was Rs. 595,400 million and Rs. 1,117,394 million respectively. This is based on market price of the Company's shares (BSE closing) of Rs. 1,971 and Rs. 3,699 as at 31st March 2014 and 31st March 2015 respectively. The share price of the Company increased by 2859 percent as on 31st March 2015 vis-a-vis the price of allotted shares at the time of said offer for sale.

DIVIDEND

The board recommends a dividend of Rs. 25 per equity share of Rs. 5 each for the year ended 31st March 2015 amounting to Rs. 7,552 million.

OPERATIONAL HIGHLIGHTS

The operations are exhaustively discussed in 'Management Discussion and Analysis' forming part of the annual report.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Accounting Standard - 21 on Consolidated Financial Statements read with Accounting Standard - 23 on Accounting for Investments in Associates and Accounting Standard - 27 on Financial Reporting of Interest in Joint Ventures, the audited consolidated financial statements are provided in the annual report.

A report on the performance and financial position of each of the subsidiaries, associates and joint venture companies as per the Companies Act, 2013 is provided as annexure to the consolidated financial statement and hence not repeated here for the purpose of brevity. No company has become or ceased to become a subsidiary, joint venture or associate company during 2014-15.

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT-9 is attached as Annexure A.

MATERIAL SUBSIDIARIES

In accordance with Clause 49(V) (D) of the Listing Agreement, the Company has formulated a policy for determining material subsidiaries. The policy has been uploaded on the website of the Company at http://www.marutisuzuki.com/ policy -on -subsidiary -companies.aspx.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes forming part of the financial statements.

BOARD MEETINGS

A calendar of meetings is prepared and circulated in advance to the directors. During the year, six board meetings were held, the details of which are given in the Corporate Governance Report.

AUDIT COMMITTEE

For composition of the audit committee, please refer to the Corporate Governance Report.

INDEPENDENT DIRECTORS

The Company has received declarations of independence in terms of Section 149 of the Companies Act, 2013 read with Clause 49 of the Listing Agreement from all the independent directors.

The details of the familiarisation programmes for the independent directors have been uploaded on the website of the Company at http://www.marutisuzuki.com/familiarisation- programmes.aspx.

DIRECTORS' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained, in terms of Section 134 of the Companies Act, 2013, your Directors state that:

a) in the preparation of the annual accounts, the applicable accounting standards have been followed and proper explanations provided relating to material departures, if any;

b) such accounting policies have been selected and applied consistently and judgments and estimates made 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 of the Company for that period;

c) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) the annual accounts have been prepared on a going concern basis;

e) internal financial controls were followed by the Company and they are adequate and are operating effectively; and

f) proper systems have been devised to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively.

DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)

Mr. Shigetoshi Torii was appointed as a Whole-time Director designated as Director (Production) with effect from 31st July 2014 to fill the casual vacancy caused by the resignation of Mr. Masayuki Kamiya who resigned as Director (Production) from the close of the business hours of 30th July 2014. Mr. Kamiya resigned as his nomination was withdrawn by Suzuki Motor Corporation. The appointment of Key Managerial Personnel i.e. Managing Director & CEO, Company Secretary and Chief Financial Officer were taken on record with effect from 1st April 2014.

RISK MANAGEMENT

Pursuant to the provisions of Clause 49 of the Listing Agreement, the Company has constituted a Risk Management Committee, the details of which are given in the Corporate Governance Report. The Company has developed a risk management policy and identified risks and taken appropriate steps for their mitigation. For more details, please refer to the Management Discussion and Analysis (MD&A).

INTERNAL FINANCIAL CONTROLS

Internal financial controls have been discussed under 'CEO/CFO Certification' in the Corporate Governance Report.

VIGIL MECHANISM

The Company already had an established and effective mechanism called the Whistle Blower Policy (Policy). The mechanism under the Policy has been appropriately communicated within the organisation. The purpose of this Policy is to provide a framework to promote responsible whistle blowing by employees. It protects employees wishing to raise a concern about serious irregularities, unethical behaviour, actual or suspected fraud within the Company.

The Chairman of the audit committee is the ombudsperson and direct access has been provided to the employees to contact him through e-mail, post and telephone for reporting any matter.

RELATED PARTY TRANSACTIONS

The Company has formulated a policy on related party transactions which has been uploaded on the Company's website at http://www. marutisuzuki.com/policy-on-related-party- transactions.aspx. In terms of Section 134(3) (h) of the Companies Act, 2013 read with Rule 15 of the Companies (Meetings of Board and its Powers) Rules, 2014, there are no transactions to be reported in Form AOC 2.

PERFORMANCE EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out the annual performance evaluation of its own performance, the Directors individually as well as the evaluation of its committees. The evaluation criteria, inter-alia, covered various aspects of the board's functioning including its composition, attendance of Directors, participation levels, bringing specialised knowledge for decision making, smooth functioning of the Board and effective decision making.

The performance of individual directors was evaluated on parameters such as level of engagement and contribution, independence of judgement, safeguarding the interest of the Company and its minority shareholders, time devoted, etc. The Directors expressed their satisfaction with the evaluation process. The criteria laid down by the Nomination and Remuneration Committee for evaluation of performance of independent directors included, inter-alia, the extent of engagement including attendance at the board/ committee meetings, ability to discharge their duties and provide effective leadership, exercise independence of judgement and safeguarding the interest of all the stakeholders including the minority shareholders.

NOMINATION AND REMUNERATION POLICY

Based on the recommendations of the Nomination and Remuneration Committee, the Board approved a Nomination and Remuneration Policy which is attached as Annexure B.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The composition of the CSR committee, CSR Policy, etc. are given in Annexure C.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place an Anti Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. During the period under review, one complaint was received by the ICC and the same was disposed of.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

Information in accordance with Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is attached as Annexure D.

CORPORATE GOVERNANCE

The Company has complied with the corporate governance requirements, as stipulated under Clause 49 of the Listing Agreement and the certificate of compliance is contained in this annual report.

SECRETARIAL AUDIT REPORT

In accordance with the provisions of Section 204 of the Companies Act, 2013 read with The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board appointed M/s RMG & Associates, a firm of Company Secretaries in practice to undertake the Secretarial Audit for 2014-15. The report on secretarial audit is attached as Annexure E. The report does not contain any qualification.

PERSONNEL

As required by the provisions of Section 197 of the Companies Act, 2013 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the particulars of the employees are set out in Annexure F. However, as per the provisions of Section 136 of the Companies Act, 2013, the annual report is being sent to all the members of the Company excluding the aforesaid information. The said information is available for inspection by the members at the registered office of the Company up to the date of the ensuing Annual General Meeting. Any member interested in obtaining such particulars may write to the company secretary at the registered office of the Company.

AUDITORS

The auditors, M/s Price Waterhouse, Firm Registration Number FRN301112E, Chartered Accountants, hold office until the conclusion of the ensuing annual general meeting and being eligible are recommended for re-appointment. A certificate from the auditors has been received to the effect that their re-appointment, if made, would be in accordance with Section 139(1) of the Companies Act, 2013. A certificate has also been obtained from the Auditors to the effect that the Company is in compliance with the conditions of Foreign Direct Investment for the downstream investment made by the Company in subsidiary companies. The auditors' report to the shareholders for the year under review does not contain any qualification.

CRISIL RATINGS

The Company was awarded the highest financial credit rating of AAA/stable (long term) and A1 (short term) on its bank facilities by CRISIL. The rating underscores the financial strength of the Company in terms of the highest safety with regard to timely fulfillment of its financial obligations.

QUALITY

The Company was awarded ISO/IEC 27001:2005 certification by STQC Directorate (Standardisation, Testing and Quality Certificate), Ministry of Communications and Information Technology, Government of India after re-assessment.

The Company has established and is maintaining an information security management system. During the year, re-certification audit under ISO-14001 was carried out by M/s AVI, Belgium for the manufacturing plants located at Gurgaon and Manesar. The auditors recommended re-certification under ISO-14001 of all manufacturing facilities.

The quality management system of the Company is certified against the ISO 9001:2008 standard. Re-assessment of the quality systems is done at regular intervals and re-certification assessments are done at every three years by an accredited third party agency. Recently, the Manesar powertrain plant including the two wheeler engine plant was added in the ISO-9001 certification scope in time with other plants of the Company. Also, the Company has an internal assessment mechanism to verify and ensure adherence to defined quality systems across the Company.

AWARDS/RECOGNITION/RANKINGS

The Company got the following awards/ recognitions/rankings during the year:

* JD Power CSI Study ranked the Company highest.

* Alto emerged as the 'World's Bestselling Small Car' for 2014 and Alto K10 AGS awarded 'Idea of The Year' by BBC Top Gear Magazine.

* Celerio named 'Hatchback of The Year' by NDTV Car & Bike Awards;'Midsize Hatchback of The Year' by Zeeginition Auto Awards 2015; 'Transmission of The Year' and 'Technology of The Year' by Auto Tech Review magazine for the auto gear shift.

* Ciaz named 'Compact Sedan of The Year' by NDTV Car & Bike Awards and 'Sedan of The Year' by Auto Bild Golden Steering Wheel Awards 2015 and 'Best of 2014' by Auto X Magazine Awards.

* 'Manufacturer of the year - 2015' (four wheelers) honored to the Company by CNBC TV18 Overdrive.

* 'Golden Peacock Award' honored to the Company for CSR in the automobile sector and the occupational health and safety for 2014.

* Greentech CSR Award under Platinum category in automobile sector.

ACKNOWLEDGMENT

The board of directors would like to express its sincere thanks for the co-operation and advice received from the Government of India and the Haryana Government. Your directors also take this opportunity to place on record their gratitude for timely and valuable assistance and support received from Suzuki Motor Corporation, Japan. The board also places on record its appreciation for the enthusiastic co-operation, hard work and dedication of all the employees of the Company including the Japanese staff, dealers, vendors, customers, business associates, auto finance companies, state government authorities and all concerned without which it would not have been possible to achieve all round progress and growth of the Company. The directors are thankful to the shareholders for their continued patronage.

For and on behalf of the board of directors

R.C. BHARGAVA KENICHI AYUKAWA Chairman Managing Director & CEO

New Delhi 27th April 2015


Mar 31, 2014

Dear Members,

The Directors have pleasure in presenting the 33rd annual report together with the audited accounts for the year ended 31st March 2014.

FINANCIAL RESULTS

The Company''s financial performance during the year 2013-14 as compared to the previous year 2012-13 is summarised below:

(Rs. in million)

2013-14 2012-13

Total revenue 445,235 444,003

Profit before tax 36,585 29,910

Tax expense 8,755 5,989

Profit after tax 27,830 23,921

Balance brought forward 153,043 130,777

Addition on amalgamation - 3,565

Profit available for appropriation 180,873 158,263

Appropriations:

General reserve 2,783 2,392

Proposed dividend 3,625 2,417

Corporate dividend tax 616 411

Balance carried forward to balance sheet 173,849 153,043

FINANCIAL HIGHLIGHTS

The total revenue (net of excise) was Rs. 445,235 million as against Rs. 444,003 million in the previous year showing an increase of 0.28 per cent. Sale of vehicles in the domestic market was 1,053,689 units as compared to 1,051,046 units in the previous year showing an increase of 0.25 per cent. Total number of vehicles exported was 101,352 units as compared to 120,388 units in the previous year.

Profit before tax (PBT) was Rs. 36,585 million against Rs. 29,910 million showing an increase of 22 per cent and Profit after tax (PAT) stood at Rs. 27,830 million against Rs. 23,921 million in the previous year showing an increase of 16 per cent.

DIVIDEND

The Board recommends a dividend of Rs. 12 (twelve) per equity share of Rs. 5 (five) each for the year ended 31st March 2014 amounting to Rs. 3,624,960,720.

OPERATIONAL HIGHLIGHTS

The operations are exhaustively discussed in the report on ''Management Discussion and Analysis'' which forms part of this annual report.

CRISIL RATINGS

The Company was awarded the highest financial credit rating of AAA/stable (long term) and A1 (short term) on its bank facilities by CRISIL. The rating underscores the financial strength of the Company in terms of the highest safety with regard to timely fulfllment of its financial obligations.

QUALITY

The Company was again awarded ISO:27001 certification by STQC Directorate (Standardisation, Testing and Quality Certifcate), Ministry of Communications and Information Technology, Government of India after re- assessment. The Company has established and is maintaining an Information Security Management System.

During the year, ISO 14001 Surveillance audit was carried out by M/s AVI Belgium and the Auditors recommended continuation of the ISO 14001

The quality management system of the Company is certified against ISO 9001:2008 Standard. Re-assessment of the quality systems is done at regular intervals and re-certification assessments are done at every 3 years by an accredited third party agency. Also, the Company has an internal assessment mechanism to verify and ensure adherence of Defined quality systems across the Company.

AWARDS/RECOGNITION/RANKINGS

J.D. Power 2013 Customer Satisfaction Index (CSI) Study ranked the Company highest for the 14th time in a row. J.D. Power Special Recognition Excellence Award also honoured to the Company for continuously being number one in customer satisfaction for more than ten years.

J.D. Power SSI Study ranked the Company highest.

Entry Compact Car of the year by J.D. Power IQS - 2013 awarded to Alto 800 and Premium Compact Car of the year by J.D. Power IQS - 2013 awarded to Swift.

Best launch car awarded to Celerio by CNB awards at auto expo 2014.

India Design Mark - Good Design Award 2013 given to Ertiga and Swift Dzire

Best Entry-Level Midsize Car by the India Vehicle Dependability Study for the 3rd time in a row given to Swift Dzire.

Maruti 800 bagged "Hall of Fame" award

Limca Book of World Records - 2014 for highest genuine spare part outlet at Leh

INSSAN honoured the Company with frst position in excellence in suggestion scheme 2013

12th Annual Greentech Safety Award - 2013 for best safety practices and Prsashnsa Patras Award 2013 honoured to the Company.

Platinum Award by Greentech Foundation honoured to the Company for best HR strategy.

SUBSIDIARY COMPANIES AND THEIR ACCOUNTS

The Company''s subsidiaries which were engaged in the business of insurance distribution in the past generated an investment income of Rs. 53.01 million including a dividend income of Rs. 0.32 million and long term capital gain of Rs. 52.69 million through mutual funds

The Company''s subsidiary True Value Solutions Limited has contributed towards smooth operations of business processes and supported the dealerships in enhancing the sale of pre-owned cars under the brand Maruti True Value. It has contributed significantly to the efforts of customer retention by facilitating sale and re-purchase of new cars through exchange and has made significant contribution towards enhancing dealers'' Profitability.

In terms of the general circular dated 8th February 2011 issued by the Government of India, Ministry of Corporate Affairs, the balance sheets, Profit & loss accounts, reports of the Board of Directors and Auditors of the subsidiary companies have not been attached with the balance sheet of the Company. Annual accounts of the subsidiary companies and the related detailed information shall be made available to shareholders of the Company and subsidiary companies seeking such information at any point of time. The annual accounts of the subsidiary companies shall also be available for inspection by any shareholder at the head office of the Company and of the subsidiary companies. Hard copy of details of accounts of subsidiaries shall be furnished to any shareholder on demand. Further, pursuant to Accounting Standard – 21 issued by the Institute of Chartered Accountants of India, consolidated financial statements presented by the Company include the financial information of its subsidiaries.

HUMAN RESOURCES DEVELOPMENT

People are the assets and have been instrumental in driving the Company''s performance year on year. Their passion, commitment, sense of ownership and team work has enabled the Company to sustain its leadership position in the challenging market scenario of 2013-14. The Company has always striven to offer a positive, supportive, open and high performance work culture where innovation and risk taking is encouraged, performance is recognised and employees are motivated to realise their true potential.

The Company hired and integrated 904 people into its workforce in the 2013- 14. The Company has 12,547 regular employees out of which 366 are women. The Company is an equal opportunity employer and believes in recognising merit and potential in the selection process. There has been a continuous effort to increase the number of women employees in the organisation to bring diversity in terms of population mix, versatility and value addition.

As in the past, the Company has been investing to strengthen positive employee relations through continuous communication, education, engagement and welfare initiatives. Several new initiatives have been introduced to reinforce people connect and engagement. Focus has also been to provide opportunities to employees to learn and grow within the organisation. These initiatives over the last one and a half year have given very encouraging results. One of the key initiatives in this direction has been umbrella mentoring to hand hold, guide and develop the young workforce. Associates are mentored and guided by supervisors who are trained on coaching, mentoring, relationship building and listening skills. With this initiative a total of 2906 associates have been covered so far by 823 trained mentors across all three plants. Another initiative is the Inbound Training called Nayi Kiran of mixed group of employees (associates, supervisors and managers) is done in series of group activities to build trust and confdence across levels and work together to solve problems creatively. A total of 1628 employees across levels have been covered till date. Also people connect and engagement initiatives like Parivar Milan (family visits to factory), community development initiatives and sports and games have helped in strengthening good relationship and positive team environment. Continuous internal communication, policy sessions, helpdesk and grievance handling forums helped us to strengthen connect with the employees and reach out to the young team members at the shop foor. Employees are also given the latest business and performance information on a regular basis through structured communication meetings.

People development and capability building across functions and levels remained a key focus area to build a strong talent pipeline. The Company continued to invest in enhancing its human capital through building skills and competencies for its employees. The learning eco-system is being transformed by endowing e-learning modules and web based trainings to employees across location through the interactive web studio in the MSIL Training Academy. Special development interventions have been taken to develop women employees in the organisation through leadership workshops and training programs on multitasking and women empowerment.

Apart from capability building interventions employees were educated on health consciousness by organising various health awareness sessions, health talks by senior doctors, periodic medical check-ups. A number of events were organised throughout the year to enhance the awareness level of our employees towards road safety.

With the commencement of the frst phase of Rohtak R & D Centre, the Company posted its frst set of employees at the new, state of the art R & D centre in November 2013. The Company took the necessary measures to ensure a smooth transition of employees to the new location with the right policy enablers in place.

The Company conducted an annual employee engagement / dipstick survey which provides meaningful and actionable feedback to the leaders in the organisation. The feedback of employees is read across several dimensions in the areas such as job satisfaction, leadership, immediate manager effectiveness, work culture and engagement. Feedback from this survey forms the basis of holistic engagement plans, which are reviewed regularly. The engagement scores saw an increase over last year which has been possible due to various engagement initiatives and HR interventions across the organisation. These initiatives helped us control attrition. MSIL maintained an attrition loss of only 2.7 per cent in the year 2013-14 which is much below the industry trends. This has been possible due to a holistic focus on employees in terms of a robust online performance management system, 360 degree feedback process, feedback through assessment and development centres, job rotation policy, training and development opportunities, higher education, multiple career growth tracks offering right impetus for greater motivation and retention.

As part of Corporate Social Responsibility, the Company adopts ITIs (Industrial Training Institute) in order to improve quality of trainings and upgrade the graduates'' skills therein to meet industry requirement and thus contribute to the society with increased employability. 29 ITIs have so far been adopted across 9 states of India. Several aspects of development viz. faculty development, student development as well as industry connect and infrastructural developmental activities are undertaken in these adopted

ITIs. Out of the 29 ITIs adopted, the Company has adopted two women ITIs in Haryana state namely ITI (W) Gurgaon and ITI (W) Jhajjar under its skill development initiative

DIRECTORS

Mr. Toshiaki Hasuike was appointed as Whole time Director designated as Joint Managing Director with effect from 27th April 2013 to fll the casual vacancy caused by resignation of Mr. Tsuneo Ohashi who resigned from the post of Director & Managing Executive officer (Production) from the close of the business hours of 26th April 2013. Mr. Toshihiro Suzuki was appointed as Director with effect from 28th October 2013 to fll the casual vacancy caused by resignation of Mr. Shinzo Nakanishi who resigned from the post of Director from the close of business hours of 27th October 2013. Mr. Masayuki Kamiya was appointed as Director (Production) to fll the casual vacancy caused by resignation of Mr. Keiichi Asai with effect from 28th October 2013 who resigned from the post of Director & Managing Executive officer (Engineering) from the close of business hours of 27th October 2013

CORPORATE SOCIAL RESPONSIBILITY (CSR) COMMITTEE

The Company constituted a CSR committee with Mr. R.C. Bhargava as its Chairman and Mr. Kenichi Ayukawa and Mr. R.P Singh as its members Mr. R.C. Bhargava is Non-Executive Chairman and Mr. R.P. Singh is an Independent Director

INTERNAL COMPLAINTS COMMITTEE (ANTI-SEXUAL HARASSMENT POLICY)

During the period under review, no complaints were received by the Internal Complaints Committee established under the Anti-Sexual Harassment Policy of the Company.

DIRECTORS'' RESPONSIBILITY STATEMENT

As required under section 217(2AA) of the Companies Act, 1956, your Directors confirm

That there were no material departures in the applicable accounting standards followed while preparing the annual accounts

Having 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 of the Company for that period;

Having taken proper and suffcient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

Having prepared the annual accounts on a going concern basis.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

A statement giving details of conservation of energy, technology absorption foreign exchange earnings and outgo in accordance with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed as Annexure A.

PERSONNEL

As required by the provisions of section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended, the names and other particulars of the employees are set out in Annexure B to the Directors'' Report. However, as per the provisions of section 219(1)(b)(iv) of the Companies Act, 1956, the annual report is being sent to all the shareholders of the Company excluding the aforesaid information. Any shareholder interested in obtaining such particulars may write to the Company Secretary at the registered office of the Company.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Accounting Standard – 21 on Consolidated Financial Statements read with Accounting Standard – 23 on Accounting for Investments in Associates in and Accounting Standard - 27 on Financial Reporting of Interest in Joint Ventures, the audited consolidated financial statements are provided in the annual report.

CORPORATE GOVERNANCE

The Company has complied with the corporate governance requirements, as stipulated under clause 49 of the listing agreement and the stipulated certifcate of compliance is contained in this annual report.

AUDITORS

The Auditors, M/s Price Waterhouse, Firm Registration Number FRN301112E, Chartered Accountants, hold office until the conclusion of the ensuing annual general meeting and are recommended for re-appointment. A certifcate from the Auditors has been received to the effect that their re-appointment, if made, would be in accordance with section 139(1) of the Companies Act, 2013. A certifcate has also been obtained from the Auditors to the effect that the Company is in compliance with the conditions of Foreign Direct Investment for the downstream investment made by the Company in subsidiary companies.

COST AUDITORS

In conformity with the directives of the Central Government, the Company has appointed M/s R. J. Goel & Co., Cost Accountants, as the Cost Auditors under Section 148 of the Companies Act, 2013 read with the rule 14 of the Companies (Audit and Auditors) Rules, 2014 for the audit of the cost accounts for the motor vehicles business for the year ending on 31st March 2015. The cost audit report for the financial year 2012-13 was fled with the Ministry of Corporate Affairs on 30th September 2013.

ACKNOWLEDGMENT

The Board of Directors would like to express its sincere thanks for the co- operation and advice received from the Government of India and the Haryana Government. Your Directors also take this opportunity to place on record their gratitude for timely and valuable assistance and support received from Suzuki Motor Corporation, Japan. The Board also places on record its appreciation for the enthusiastic co-operation, hard work and dedication of all the employees of the Company including the Japanese staff, dealers, vendors, customers, business associates, auto finance companies, state government authorities and all concerned without which it would not have been possible to achieve all round progress and growth of the Company. The Directors are thankful to the shareholders for their continued patronage.

For and on behalf of the Board of Directors

Kenichi Ayukawa R.C. Bhargava

Managing Director & CEO Chairman

New Delhi 21st May 2014


Mar 31, 2013

The directors have pleasure in presenting the 32nd annual report together with the audited accounts for the year ended 31st March 2013.

FINANCIAL RESULTS

The Company''s financial performance during the year 2012-13 as compared to the previous year 2011-12 is summarised below: (Rs. in million)

2012-13 2011-12

Total revenue 444,003 364,139

Profit before tax 29,910 21,462

Tax expense 5,989 5,110

Profit after tax 23,921 16,352

Balance brought forward 130,777 118,578

Addition on amalgamation 3,565 -

Profit available for appropriation 158,263 134,930

Appropriations:

General reserve 2,392 1,635

Proposed dividend 2,417 2,167

Corporate dividend tax 411 351

Balance carried forward to balance sheet 153,043 130,777

FINANCIAL HIGHLIGHTS

The total revenue (net of excise) was Rs. 444,003 million as against Rs. 364,139 million in the previous year showing an increase of 22 per cent. Sale of vehicles in the domestic market was 1,051,046 units as compared to 1,006,316 units in the previous year showing an increase of 4 per cent. Total number of vehicles exported was 120,388 units as compared to 127, 379 units in the previous year.

Profit before tax (PBT) was Rs. 29,910 million against Rs. 21,462 million showing an increase of 39 per cent and profit after tax (PAT) stood at Rs. 23,921 million against Rs. 16,352 million in the previous year showing an increase of 46 per cent.

DIVIDEND

The board recommends a dividend of Rs. 8 (eight) per equity share of Rs. 5 each for the year ended 31st March 2013 amounting to Rs. 2,417 million.

OPERATIONAL HIGHLIGHTS

The operations are exhaustively discussed in the report on ''Management Discussion and Analysis'' which forms part of this annual report.

CRISIL RATINGS

The Company was awarded the highest financial credit rating of AAA/stable (long term) and A1 (short term) on its bank facilities by CRISIL. The rating underscores the financial strength of the Company in terms of the highest safety with regard to timely fulfillment of its financial obligations.

QUALITY

The Company was again awarded

ISO:27001 certification by STOC Directorate (Standardisation, Testing and Quality Certificate), Ministry of Communications and Information Technology, Government of India after re-assessment. The Company has established and is maintaining an Information Security Management System.

During the year, ISO 14001 Surveillance audit was carried out by M/s AVI, Belgium and the auditors recommended continuation ofthe ISO 14001.

The quality management system of the Company is certified against ISO 9001:2008 Standard. Re-assessment ofthe quality systems is done at regular intervals and re-certification assessments are done at every 3 years by an accredited third party agency. Also, the Company has an internal assessment mechanism to verify and ensure adherence of defined quality systems across the Company.

AWARDS/RECOGNITION/ RANKINGS

J. D. Power Asia Pacific 2012 Customer Satisfaction Index (CSI) Study ranked the Company highest for the 13th time in a row.

Golden Peacock Award - 2012 for occupational health and safety in automobile sector.

Golden Peacock Award - 2012 for sustainability.

Some of the awards given to Ertiga were:

MUV ofthe year by Car India Awards

- MPV of the year by ET Zigwheels, Autocar India and BS Motoring 2013

Compact SUV for the year by CNBC Overdrive

- Top Gear family car of the year

Some of the awards given to Alto 800 were:

- Entry Hatchback Car of the Year 2012 by NDTV CNBC Awards 2013 Entry-level Hatchback Car of the Year by ET Zigwheels Awards 2012

- Best Value for Money Car of the year by Autocar Awards2013

Compact Car of the year by CNBC Overdrive

- Viewers Choice by CNBC Overdrive

Some of the awards given to Swift

DZire were:

- Compact Sedan of the year 2013

Compact Sedan of the year by Car India

Midsized Car of the year by CNBC Overdrive

The Company ranked third in the list of 100 most successful and influential companies in India listed by TLG Partners, London.

Mr. R. C. Bhargava, Chairman was awarded the Automobile Person of the Year 2013 by NDTV Profit.

SUBSIDIARY COMPANIES AND THEIR ACCOUNTS

The Company''s subsidiaries which were engaged in the business of insurance distribution in the past generated an investment income of Rs. 141.75 million including a dividend income of Rs. 8.93 million and long term capital gain of Rs. 132.82 million through mutual funds.

The Company''s subsidiary ''True Value Solutions Limited'' has contributed towards smooth operations of business processes and supported the dealerships in enhancing the sale of pre-owned cars under the brand Maruti True Value. It has contributed significantly to the efforts of customer retention by facilitating sale and re-purchase of new cars through exchange and has made significant contribution towards enhancing dealers'' profitability.

In terms of the general circular dated 8th February 2011 issued by the Government of India, Ministry of Corporate Affairs, the balance sheets, profit & loss accounts, reports of the board of directors and auditors of the subsidiary companies have not been attached with the balance sheet of the Company. Annual accounts of the subsidiary companies and the related detailed information shall be made available to shareholders of the Company and subsidiary companies seeking such information at any point of time. The annual accounts of the subsidiary companies shall also be available for inspection by any shareholder at the head office of the Company and of the subsidiary companies. Hard copy of details of accounts of subsidiaries shall be furnished to any shareholder on demand. Further, pursuant to Accounting Standard - 21 issued by the Institute of Chartered Accountants of India, consolidated financial statements presented by the Company include the financial information of its subsidiaries.

AMALGAMATION

During the year under review, Suzuki Powertrain India Limited (SPIL) was amalgamated with and into the Company vide the order of the Hon''ble High Court of Delhi dated 29th January 2013. The order was filed with the Registrar of Companies, Ministry of Corporate Affairs on 17th March 2013. The appointed date of amalgamation was 1st April 2012. Pursuant to the scheme of amalgamation, 1,3170,000 equity shares of Rs. 5/- each were allotted to Suzuki Motor Corporation on 29th March 2013 and the paid up equity capital stands increased to Rs. 1,510 million.

HUMAN RESOURCE DEVELOPMENT

To have a sustainable competitive advantage in the new knowledge economy, learning is a key catalyst for an organisation''s survival and success. The Company, therefore, provided tremendous learning and development opportunities to its employees, starting from induction and orientation program for all the new joinees to regular training programs to develop and enhance the skill levels (functional and behavioral) for all the employees. The training programs varied and were tailored according to the business requirements, employee needs at various levels and are designed with the help of a thorough and well structured process of need identification connected to the business demands. The Company''s annual training calendar encompassed training programs for all categories of employees i.e. associates, supervisors and junior, middle, senior and top management level. To ensure a well rounded development of all the employees, the training calendar comprised of behavioral, functional, safety and environment trainings.

In 2012 -13, a total of 48,300 man-days of training were conducted for the employees across all the levels. This translates to an average of 5.15 days of training per employee.

The functional and technical trainings formed an important part of the Company''s annual training calendar as they are directly linked with the employees'' role and on the job performance. These trainings were imparted by in-house subject matter experts as well as by identified external trainers.

Some of the functional trainings imparted internallyare 3G,3K,5S, Design Failure Mode Effects Analysis (DFMEA), environment, product training and Quality Control (OC) tools. Examples of few functional trainings which are done by external trainers are finance for non-finance, six sigma, project management, inventory and warehouse management, world class manufacturing practices, auto cad, MS excel, etc.

The behavioral trainings also formed a considerable portion of the training calendarand included trainings on subjects like negotiation skills, problem solving and decision making skills, presentation and communications skills, conflict management and resolution, assertiveness and self confidence, time management and multi tasking skills, leading effectively, inter personal relationships, personal effectiveness, work life balance, team working, competency based interviewing skills, etc.

Workshops were designed specifically for the women employees to help them understand challenges at work woman, managing perceptions, expectations and disappointments, self-esteem, balancing work and home and managing stress.

The Company also provided higher education schemes for its employees. It helped not only to groom and retain the high potential young managers but also enabled employees to fulfill their career enhancement aspirations, while still working in the organisation. The scheme included programs like - executive MBA (full time and part time) at select campuses. The scheme was available for employees at levels of assistant managers to managers.

DIRECTORS

Mr. Amal Ganguli, Mr. Keiichi Asai and Mr. D. S. Brar, Directors of the Company, retire by rotation at the ensuing annual general meeting and being eligible, offer themselves for re-appointment. Mr. M. S. Banga, Independent Director resigned from the board of the Company with effect from close of business hours of 26th October 2012. Mr. R. P. Singh was appointed as an Independent Director in the casual vacancy caused bythe resignation of Mr. M.S. Banga. Mr. Shinzo Nakanishi retired from the post of MD & CEO of the Company with effect from close of business hours of 31st March 2013. Mr. Kenichi Ayukawa was appointed as the MD & CEO of the Company with effect from 1st April 2013.

DIRECTORS'' RESPONSIBILITY STATEMENT

As required under section 217(2AA) of the Companies Act, 1956, your directors confirm:

a) that there were no material departures in the applicable accounting standards followed while preparing the annual accounts;

b) having 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 of the Company for that period;

c) having taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

d) having prepared the annual accounts on a going concern basis.

CONSERVATION OF ENERGY,TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

A statement giving details of conservation of energy, technology absorption, foreign exchange earnings and outgo in accordance with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed as Annexure A.

PERSONNEL

As required by the provisions of section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended, the names and other particulars of the employees are set out in Annexure B to the Directors'' Report. However, as per the provisions of section 219(l)(b)(iv) of the Companies Act, 1956, the Annual Report is being sent to all the shareholders of the Company excluding the aforesaid information. Any shareholder interested in obtaining such particulars may write to the Company Secretary at the registered office of the Company.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Accounting Standard - 21 on Consolidated Financial Statements read with Accounting Standard - 23 on Accounting for Investments in Associates and Accounting Standard - 27 on Financial Reporting for Interest in Joint Ventures, the audited consolidated financial statements are provided in the Annual Report.

CORPORATE GOVERNANCE

The Company has complied with the corporate governance requirements, as stipulated under clause 49 of the listing agreement and the stipulated certificate of compliance is contained in this Annual Report.

AUDITORS

The auditors, M/s Price Waterhouse, Firm Registration Number FRN301112E, Chartered Accountants, hold office until the conclusion of the ensuing annual general meeting and are recommended for re-appointment. A certificate from the auditors has been received to the effect that their re-appointment, if made, would be in accordance with section 224 (IB) of the Companies Act, 1956.

COST AUDITORS

In conformity with the directives of the Central Government, the Company has appointed M/s R. J. Goel & Co., cost accountants, as the cost auditors under section 233B of the Companies Act, 1956 for the audit of the cost accounts for the motor vehicles business for the year ending on 31st March 2014. The extended due date of filing the cost audit report for the financial year 2011-12 in ''Extended Business Reporting Language'' (XBRL) format with the Ministry of Corporate Affairs was 28th February 2013. This report was filed within the stipulated time on 18th January 2013.

ACKNOWLEDGMENT

The board of directors would like to express its sincere thanks for the co-operation and advice received from the Government of India and the Haryana Government. Your directors also take this opportunity to place on record their gratitude for timely and valuable assistance and support received from Suzuki Motor Corporation, Japan. The board also places on record its appreciation for the enthusiastic co-operation, hard work and dedication of all the employees of the Company including the Japanese staff, dealers, vendors, customers, business associates, auto finance companies, state government authorities and all concerned without which it would not have been possible to achieve all round progress and growth of the Company. The directors are thankful to the shareholders for their continued patronage.

For and on behalf of the board of directors

KENICHI AYUKAWA R.C. BHARGAVA

Managing Director Chairman & CEO

New Delhi

26th April 2013


Mar 31, 2012

The directors have pleasure in presenting the 31st annual report together with the audited accounts for the year ended 31st March 2012.

FINANCIAL RESULTS

The Company's financial performance during the year 2011-12, as compared to the previous year 2010-11 is summarised below:

(Rs. in million)

Particulars 2011-2012 2010-2011

Total revenue 364,139 371,272

Profit before tax 21,462 31,088

Tax expense 5,110 8,202

Profit after tax 16,352 22,886

Balance brought forward 118,578 100,499

Profit available for appropriation 134,930 123,385

Appropriations:

General reserve 1,635 2,289

Proposed dividend 2,167 2,167

Corporate dividend tax 351 351

Balance carried forward to balance sheet 130,777 118,578

FINANCIAL HIGHLIGHTS

The total revenue (net of excise) was Rs. 364,139 million as against Rs. 371,272 million in the previous year showing a marginal decline of 1.92 per cent. Sale of vehicles in the domestic market was 1,006,316 units as compared to 1,132,739 units in the previous year. Total number of vehicles exported was 127,379 as compared to 138,266 in the previous year.

Profit before tax (PBT) was Rs. 21,462 million against Rs. 31,088 million and profit after tax (PAT) stood at Rs. 16,352 million against Rs. 22,886 million in the previous year.

DIVIDEND

The board recommends a dividend of Rs. 7.50 per equity share of Rs. 5 each for the year ended 31st March 2012 amounting to Rs. 2167 million.

OPERATIONAL HIGHLIGHTS

The operations are exhaustively discussed in the report on 'Management Discussion and Analysis' which forms part of this annual report.

CRISIL RATINGS

The Company has been awarded the highest financial credit rating of AAA/stable (long term) and A1 (short term) on its bank facilities by CRISIL. The rating underscores the financial strength of the Company in terms of the highest safety with regard to timely fulfillment of its financial obligations.

QUALITY

The Company has again been awarded ISO :27001 certification by STQC Directorate (Standardisation, Testing and Quality Certificate), Ministry of Communications and Information Technology, Government of India after re-assessment. The Company is thus certified to meet international standards for maintaining information security.

During the year, ISO 14001 re-certification audit was carried out by M/s AVI, Belgium and the auditors renewed the ISO 14001 certificate till 2014.

The quality management system of the Company is certified against ISO 9001:2008 standard. Re-assessment of the quality systems are done at regular intervals by an accredited third party agency.

AWARDS/RECOGNITION/RANKINGS

- J D Power Customer Satisfaction Index (CSI) Study ranked the Company highest for the 12th time in a row.

- J D Power Asia Pacific 2011 India Vehicle Dependability Study ranked Zen Estilo and Swift DZire as the 'most dependable cars'.

- JD Power IQS ranked Zen Estilo and Swift DZire highest in the 'compact' and 'entry midsize' segment respectively.

- J D Power APEAL Study 2011 ranked Alto and Zen Estilo highest in the 'compact' segment. Swift DZire received an award in the 'entry midsize car' segment for a fourth consecutive year.

- CNBC TV 18 Overdrive awarded 'Compact Car of the year 2012' to new Swift.

- NDTV CNB's 'Premium hatchback of the year' awarded to new Swift.

- BBC India Top Gear's 'Small car of the year 2011' awarded to new Swift.

- ICOTY 2012 'Indian Car of the Year 2012' awarded to new Swift.

- Bloomberg UTVi's 'Compact Car of the Year' awarded to new Swift.

Mr. R. C. Bhargava, Chairman was bestowed with 'The Order of the Rising Sun, Gold and Silver Star' by His Majesty Emperor Akihito of Japan.

SUBSIDIARY COMPANIES AND THEIR ACCOUNTS

The Company's subsidiaries which were engaged in the business of insurance distribution in the past generated an investment income of Rs. 163.80 million including a dividend income of Rs. 28.65 million and long term capital gain of Rs. 129.13 million through mutual funds.

The Company's subsidiary 'True Value Solutions Limited' has contributed towards smooth operations of business processes and supported the dealerships in enhancing the sale of certified pre-owned cars under the brand 'Maruti True Value'. It has contributed significantly to the efforts of customer retention by facilitating sale and re-purchase of new cars through exchange and has made significant contribution towards enhancing dealers' profitability.

In terms of the general circular dated 8th February 2011 issued by the Government of India, Ministry of Corporate Affairs, the balance sheets, profit & loss accounts, reports of the board of directors and auditors of the subsidiary companies have not been attached with the balance sheet of the Company. Annual accounts of the subsidiary companies and the related detailed information shall be made available to shareholders of the Company and subsidiary companies seeking such information at any point of time. The annual accounts of the subsidiary companies shall also be available for inspection by any shareholder at the head office of the Company and of the subsidiary companies. Hard copy of details of accounts of subsidiaries shall be furnished to any shareholder on demand. Further, pursuant to Accounting Standard - 21 issued by the Institute of Chartered Accountants of India, consolidated financial statements presented by the Company include the financial information of its subsidiaries.

HUMAN RESOURCE DEVELOPMENT

The Company provides tremendous learning and development opportunities to its employees starting from induction and orientation when a new employee joins the Company. The Company believes that to have a sustainable competitive advantage in the new knowledge economy, learning would be the key catalyst for an organisation's survival and success. The Company's extensive training calendar encompasses training programs for all categories of employees i.e. associates, supervisors and those at junior, middle, senior and top management level. To have a well rounded development of employees, the training calendar comprises of behavioral, functional and safety trainings. The training programmes vary according to the need of the employees at various levels and business requirements and are designed after doing a thorough process of three stage need identification.

In 2011 - 12, a total of 47,000 man-days of training were conducted for employees across all the levels. This translates to an average of 5.15 days of training per employee.

Functional and technical trainings form an important part of the Company's annual training calendar as they are directly linked with employees' on the job performance. These trainings are imparted by in-house subject matter experts as well as by external trainers. Some of the functional trainings imparted internally are 3G, 3K, 5S, DFMEA and QC tools. Few functional trainings which are being done by external trainers are finance for non-finance, six sigma, project management, inventory & warehouse management, world class manufacturing practices, auto cad, MS excel, etc.

Behavioral trainings also form a considerable portion of the training calendar and include trainings like negotiation skills, problem solving & decision making skills, presentation & communication skills, conflict management & resolution, assertiveness & self confidence, time management & multi tasking skills, leading effectively, inter personal relationships, etc.

The Company also has higher education schemes for its employees. It helps not only to groom and retain high potential young managers but also enables employees to fulfill their career enhancement aspirations. The scheme includes programs like - executive MBA (full time and part time) at select campuses. The scheme is available for employees at levels of assistant managers to managers and is guided by eligibility and selection criteria.

DIRECTORS

Mr. R. C. Bhargava, Mr. Kazuhiko Ayabe and Ms. Pallavi Shroff, directors of the Company, retire by rotation at the ensuing annual general meeting and being eligible, offer themselves for re-appointment. Mr. Shuji Oishi resigned from the post of Director and Managing Executive Officer (Marketing & Sales) with effect from the close of the business hours of 27th April 2012. Mr. Kazuhiko Ayabe was appointed as Director and Whole-time Director designated as Director & Managing Executive Officer (Supply Chain) with effect from 28th April 2012 subject to the approval of the shareholders in general meeting to fill the casual vacancy caused by the resignation of Mr. Shuji Oishi. Mr. Kinji Saito was appointed as an Additional Director and he holds office upto the date of the 31st annual general meeting of the Company.

DIRECTORS' RESPONSIBILITY STATEMENT

As required under section 217(2AA) of the Companies Act, 1956, your directors confirm:

a) that there were no material departures in the applicable accounting standards followed while preparing the annual accounts;

b) having 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 of the Company for that period;

c) having taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

d) having prepared the annual accounts on a going concern basis.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

A statement giving details of conservation of energy, technology absorption, foreign exchange earnings and outgo in accordance with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed as Annexure A.

PERSONNEL

As required by the provisions of section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended, the names and other particulars of the employees are set out in Annexure B to the Directors' Report. However, as per the provisions of section 219(1 )(b)(iv) of the Companies Act, 1956, the annual report is being sent to all the shareholders of the Company excluding the aforesaid information. Any shareholder interested in obtaining such particulars may write to the Company Secretary at the registered office of the Company.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Accounting Standard - 21 on Consolidated Financial Statements read with Accounting Standard - 23 on Accounting for Investments in Associates and Accounting Standard - 27 on Financial Reporting for Interest in Joint Ventures, the audited consolidated financial statements are provided in the annual report.

CORPORATE GOVERNANCE

The Company has complied with the corporate governance requirements, as stipulated under clause 49 of the listing agreement and the stipulated certificate of compliance is contained in this annual report.

AUDITORS

The auditors, M/s Price Waterhouse, Firm Registration Number FRN301112E, Chartered Accountants, hold office until the conclusion of the ensuing annual general meeting and are recommended for re-appointment. A certificate from the auditors has been received to the effect that their re-appointment, if made, would be in accordance with section 224 (1B) of the Companies Act, 1956.

COST AUDITORS

In conformity with the directives of the Central Government, the Company has appointed M/s R. J. Goel & Co., cost accountants, as the cost auditors under section 233B of the Companies Act, 1956 for the audit of the cost accounts for the motor vehicles business for the year ending on 31st March 2013. The due date of filing the cost audit report for the financial year 2010-11 was 30th September 2011. This report was filed on 13th September 2011 with the Ministry of Corporate Affairs.

ACKNOWLEDGMENT

The board of directors would like to express its sincere thanks for the co-operation and advice received from the Government of India and the Haryana Government. Your directors also take this opportunity to place on record their gratitude for timely and valuable assistance and support received from Suzuki Motor Corporation, Japan. The board also places on record its appreciation for the enthusiastic co-operation, hard work and dedication of all the employees of the Company including the Japanese staff, dealers, vendors, customers, business associates, auto finance companies, state government authorities and all concerned without which it would not have been possible to achieve all round progress and growth of the Company. The directors are thankful to the shareholders for their continued patronage.

For and on behalf of the board of directors

Shinzo Nakanishi R. C. Bhargava

Managing Director & CEO Chairman

New Delhi

29th May 2012


Mar 31, 2010

The directors have pleasure in presenting the 29th annual report together with the audited accounts for the year ended 31st March 2010.

FINANCIAL RESULTS

The Companys performance during the year is summarized below:

(Rs. in million)

2009-10 2008-09

Cross total income 301.198 214,538

Profit before tax 35,925 16,758

Ta» expense 10,949 4.571

Profit after tax 24,976 12,187

Balance brought forward 80.042 70,257

Profit available for appropriation 105.018 82,444

Appropriations:

General reserve 2.498 1,219

Proposed dividend 1,733 1,011

Corporate dividend tax 288 172

Balance carried forward to balance sheet 100,499 80,042

FINANCIAL HIGHLIGHTS

The gross revenue (net of excise) of the Company for the year was Rs. 301,198 million as against Rs. 214,538 million in the previous year showing growth of 40%. Sales of vehicles in the domestic market increased to 870,790 as compared to 722,144 in the previous year showing a growth of 21%. Exports of vehicles grew at an impressive rate of 111% from 70,023 to 147,575 in the current year. The overall growth was 29%.

Earnings before depreciation, interest, tax and amortization (EBDITA) stood at Rs. 44,510 million against Rs. 24,333 million in the previous year.

Profit before tax (PBT) stood at Rs. 35,925 million against Rs. 16,758 million in the previous year and profit after tax (PAT) stood at Rs. 24,976 million against Rs. 12,187 million in the previous year.

DIVIDEND

The board recommends a dividend of Rs. 6.00 per equity share of Rs. 5.00 each for the year ended 31st March 2010 amountingtoRs.1733 million.

CRISIL RATINGS

The Company has been awarded the highest financial credit rating of AAA/stable (long term) and P1+ (short term) on its bank facilities by CRISILThe rating underscores the financial strength of the Company in terms of the highest safety with regard to timely fulfillment of its financial obligations.

QUALITY

The Company has again been awarded ISO:27001 certification by STQC Directorate (Standardization,Testing & Quality Certificate), Ministry of Communications and Information Technology, Government of India after re- assessment. The Company is thus certified to meet international standards for maintaining information security.

The Companys plants at Curgaon and Manesar are ISO: 14001:2004 certified. During the year, AIB-Vincotte International Ltd., Brussels, Belgium conducted surveillance audit and recommended continuation of the certification.

The quality management system of the Company is certified against ISO 9001:2000 standard. Re-assessment of the quality systems are done at regular intervals by an accredited third party agency.

HIGHLIGHTS OF OPERATIONS

The operations during the year are exhaustively discussed in the report on Management Discussion and Analysis which forms part of this annual report.

AWARDS/RECOGNITION

The Company won the following awards/recognition during the year under review:

- A- Star has been rated as No.1 environment friendly small car by Germanys prestigious VCD environmental car rating;

- Manufacturer of the year award by CNBC overdrive;

- Ritz has been awarded as the hatchback car of the year by autocar UTVi and car of the year by Business Standard Motoring;

- National award for excellence in corporate governance by Institute of Company Secretaries of India;

- CII-ITC sustainability award 2009 for strong commitment to sustainability;

- Golden peacock awardfor environmental initiatives;

- Gurgaon plant has been awarded the gold award by EconomicTimes India Manufacturing Excellence Awards (IMEA).

SUBSIDIARY COMPANIES AND THEIR

ACCOUNTS

The Companys six subsidiaries i.e. Maruti Insurance Business Agency Limited, Maruti Insurance Distribution Services Limited, Maruti Insurance Agency Solutions Limited, Maruti Insurance Agency Network Limited, Maruti Insurance Agency Services Limited and Maruti Insurance Agency Logistics Limited are engaged in the business to sell motor insurance policies to owners of Maruti Suzuki vehicles.

In 2009-10, the Maruti Insurance business generated a total income of Rs. 1349.88 million which includes dividend income of Rs. 46.10 million earned from investments in mutual funds. Profit before tax (PBT) for 2009-10 was Rs. 635.49 million. In March 2010, Maruti Insurance business achieved the landmark figure of 10 million policies on a cumulative basis since the inception of business in year 2002. 0.81 million new policies and 1.76 million renewals were issued duringtheyear 2009-10.

The Companys subsidiary True Value Solutions Limited has contributed towards smooth operations of business processes and supported the dealerships in enhancing the sale of certified pre-owned cars under the brand Maruti True Value. It has contributed significantly to the efforts of customer retention by facilitating re-purchase of new cars and has made significant contribution towards enhancing dealers profitability.

In terms of approval granted by the Central Government under Section 212(8) of the Companies Act, 1956, copy of the balance sheets, profit & loss accounts, reports of the board of directors and auditors of the subsidiary companies have not been attached with the balance sheet of the Company. These documents will be made available upon request by any investor of the Company or subsidiary companies and shall be kept for inspection by any investor at the registered office of the Company. However, as directed by the Central Government, the financial data of the subsidiaries have been furnished under "Financial Statement of Subsidiary Companies" forming part of the annual report. Further, pursuant to Accounting Standard AS - 21 issued by the institute of Chartered Accountants of India, consolidated financial statements presented by the Company include the financial information of its subsidiaries.

HUMAN RESOURCE DEVELOPMENT

The Company has always focused on employees development. A total of 46200 man-days of training were conducted for employees across all levels during the year.

The training programmes vary according to the need of the employees at various levels. Based on the behavioral traits, some of the trainings introduced in 2009-10 were changing mindset-changing lives; being the best; emotional intelligence; planning organizing problem solving; assertiveness & self confidence and conflict management. Some of the trainings based on technical needs include market research; capital budgeting; risk management & hedging; unigraphics; business simulation games; inhouse quiz; cost management; taxation; motion & time study; design failure mode effect analysis and geometric designing & tolerancing. Training for leader ship traits include departmental heads convention; divisional head training and director re-treat.

The Company also has higher education schemes for its employees.

DIRECTORS

Mr. Kenichi Ayukawa, Mr. D.S.Brarand Mr. M.S.Banga, directors of the Company, retire by rotation at the ensuing annual general meeting and being eligible, offer themselves for re- appointment.

DIRECTORS" RESPONSIBILITY STATEMENT

As required under section 217(2AA) of the Companies Act, 1956,your directors confirm:

a) that there were no material departures in the applicable accounting standards followed while preparing the annual accounts;

b) having 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 of the Company for that period;

c) having taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

d) having prepared the annual accounts on a going concern basis.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

A statement giving details of conservation of energy, technology absorption, foreign exchange earnings and outgo in accordance with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed as AnnexureA.

PERSONNEL

As required by the provisions of section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended, the names and other particulars of the employees are set out in Annexure B to the Directors Report. However, as per the provisions of section 219(1 )(b)(iv) of the Companies Act, 1956. the annual report is being sent to all the shareholders of the Company excluding the aforesaid information. Any shareholder interested in obtaining such particulars may write to the Company Secretary at the registered office of the Company.

CONSOLIDATED FINANCIAL STATEMENTS

in accordance with the Accounting Standard - 21 on Consolidated Financial Statements read with Accounting Standard - 23 on Accounting for Investments in Associates and Accounting Standard - 27 on Financial Reporting for interest in Joint Ventures, the audited consolidated financial statements are provided in the annual report.

CORPORATE GOVERNANCE

The Company has complied with the corporate governance requirements, as stipulated under clause 49 of the listing agreements and the stipulated certificate of compliance is contained in this annual report.

AUDITORS

The auditors, M/s Price Waterhouse, Chartered Accountants, hold office until the conclusion of the ensuing annual general meeting and are recommended for re-appointment. A certificate from the auditors has been received to the effect that their re-appointment, if made, would be in accordance with section 224 (1B) of the Companies Act, 1956.

COST AUDITORS

In conformity with the directives of the Central Government, the Company has appointed M/s R. J. Coel & Co., Cost Accountants, as the cost auditors under section 233B of the Companies Act, 1956 for the audit of the cost accounts for the motor vehicles business for the year ending31st March 2011.

ACKNOWLEDGMENT

The board of directors would like to express its sincere thanks for the co-operation and advice received from the Government of India and the Haryana Government. Your directors also take this opportunity to place on record their gratitude for timely and valuable assistance and support received from Suzuki Motor Corporation, Japan. The board also places on record its appreciation for the enthusiastic co- operation, hard work and dedication of all the employees of the Company including the Japanese staff, dealers, vendors, customers, business associates, auto finance companies, state government authorities and at! concerned without which it would not have been possible to achieve all round progress and growth of the Company. The directors are thankful to the shareholders for their continued patronage.

For and on behalf of the board of directors

Shinzo Nakanishi R.C. Bhargava

Managing Director & CEO Chairman

New Delhi 14,th July 2010



 
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