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Directors Report of Ramkrishna Forgings Ltd.

Mar 31, 2015

Dear Members,

The Directors are pleased to present the 33rd Annual Report of your Company along with the Audited Accounts for the financial year ended 31st March, 2015.

Financial Highlights 2014-2015 (Rs. in Lacs)

Year ended Year ended 31st March, 2015 31st March, 2014

Sales and Operating Income (Net) 74,075.95 42,952.78

Other Income 573.32 238.69

Profit before Interest, Depreciation 13,993.38 5,996.47 & Tax (incl Exceptional Item)

Finance Cost 3,029.55 2,226.38

Depreciation 3,121.65 2,491.79

Profit Before Tax (before 7,095.96 1,278.30 Exceptional Items)

Exceptional Items 746.22 -

Profit Before Tax 7,842.18 1,278.30

Provision for taxation :

- Current Tax 1,642.00 526.00

- MAT Credit Entitlement (1,642.00) -

- Deferred Tax 353.99 (93.08)

- Tax adjustments for 14.61 0.12 earlier years (Net)

Profit After Tax 7,473.58 845.26

Add: Surplus Brought Forward 9,685.51 9,195.60

Surplus available 17,159.09 10,040.86

Appropriations :

Dividend and Tax on Dividend paid for 2014-15

- Transfer to General Reserve 750.00 50.00

- Dividend 549.40 260.99

- Tax on Distributed profits 109.85 44.36

Balance carried to Balance Sheet 15,749.84 9,685.51

State of Company''s Affairs and Future Outlook

Financial Performance

* Net Sales increased by 72.46% from Rs. 42952.78 Lacs in 2013-14 to Rs. 74075.95 Lacs in 2014-15.

* Export Sales increased by 241.85% from 10274.72 Lacs in 2013-14 to Rs. 35123.71 Lacs in 2014-15.

* EBIDTA (excluding exceptional items and other income) increased by 107.16% from Rs. 5,757.77 Lacs in 2013-14 to Rs. 11,927.61 Lacs in 2014-15.

* PAT increased by 784.18% from Rs. 845.26 Lacs in 2013-14 to Rs. 7473.58 Lacs in 2014-15.

The sales in domestic CV industry has shown some signs of recovery in FY 2015. It closed the fiscal at 614961 units, reflecting a 2.83% de-growth over the previous year - a significant improvement over the 20.23% de-growth in 2013-14.

Within the CV space, the Medium & Heavy Commercial Vehicle (M&HCV) Truck segment has in fact posted a positive growth. While the M & HCV segment has been witnessing strong demand (up 16.02% YoY) on back of replacement demand (following two years of deferment) and capacity addition by organized fleet operators to some extent.

The LCV Truck segment experienced sluggish trends (down 11.57% YoY) as significant capacity addition over the past few years and constrained financing environment amidst rising delinquencies continued to challenge the segment.

The bus segment, which contributes nearly more than 10% to industry sales, also started witnessing an improvement from Q3 FY15 onwards after various State Road Transport Undertakings (SRTUs) started placing orders for new buses as part of the JNNURM II programme.

The production of medium & heavy commercial Vehicles (M&HCVs) segment registered a growth at 21.21% during the year 2014-15 and Light Commercial Vehicles registered a de- growth of 10.25%.

In USA the Vehicle registrations increased for a record sixth year running in 2014, with registrations of passenger cars and light commercial vehicles reaching 16.4m units. This was the highest total since 2006 and a 5.7% increase from the previous year. The US accounts for around one-fifth of global automotive sales. New medium and heavy commercial vehicle registrations have recovered strongly from the lows recorded following the global financial crisis, although the pace of growth slowed to single digits in 2012-14, partly owing to the higher baseline.

There have been no material changes and commitments, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report.

Operational Highlights

Forgings and Machining facility

The Company derives the major share of its revenues from the commercial vehicle segment. Your Company produced 33267 tons during the year under review as compared to 23466 tons last year registering an increase of about 41.75%. The Company has installed a new 6 inch upsetter during the last quarter of 2014-15 which has enhanced the forgings capacity by around 8000 tons. The Company has the state-of-art of CNC Machining and Gear Cutting Facilities in which it has achieved accuracies of DIN 3962 (Class 8 to 9) in Hobbing Stage, DIN 3962 (Class 7) in Shaving Stage, DIN 3962 (Class 9) in Hard Stage. The Company has made 167 new product development in the CNC machining, 13 new development in Gear cutting and 10 items in the VMC/HMC section, which has helped to enhance the product basket with existing clients and add new clients in the domestic market and more pre-dominantly in the export sector.

Ring Rolling Line

Ring rolling is a cost-effective and efficient production process for production of ring-shaped components like crown wheels, bearing rings etc. The equipment is fully capable of meeting the requirements of the automobile industry, especially that of commercial vehicles (primarily medium and heavy vehicles).

The Company has produced 22645 tons during the year as compared to 17794 tons last year thus registering a increase of about 27.25%. It has achieved a capacity utilisation of around 94% during the year as compared to around 74% last year on account of good export demand and demand from the domestic commercial vehicle segment.

The Company has developed 90 new products during the year and out of that 76 new parts are towards export. The Company has been able to enhance its export portfolio by adding new clients and enhancing its product range which helped it to augment the export market of the Company .

Press Facility

The Company has commissioned 3150 ton Pressline and 4500 ton Pressline on 21st July, 2014 which translates into 17500 MT of the Installed Capacity.

During the year the Company has achieved a production of 5596 tons and achieved a capacity utilisation of around 46 %.

During the Year there has been no change in the nature of the business carried by the Company

Future Outlook

M&HCV (Truck) segment : This segment is likely to register a growth of 12-14% in FY 2016 driven by continuing trend towards replacement of ageing fleet and expectations of pick-up in demand from infrastructure and industrial sectors in view of reforms being initiated by the Government. Over the medium term, the demand for new CVs will also be driven by gradual acceptance of advance trucking platforms, progression to BS-V emission norms (possibly by 2017 onwards) and introduction of technologies such as Anti- Lock Braking System (ABS), which may lead to some advance purchases by fleet operators.

As the global economy recovers, commercial vehicle registrations should gather strength. It is expected to rise by 2.1% in 2015 and accelerate into 2016 and beyond, taking the annual average growth to 4.7% over 2015-19. This growth will be driven by rising business confidence, bolstered by the unexpected decision to keep interest rates low in most developed markets. Low global oil prices could also encourage a rise in freight traffic against other shipping methods.

Transfer to Reserves

Your Company proposes to transfer Rs. 750.00 Lacs to General Reserve out of the amount available for appropriation and an amount of Rs. 15749.84 Lacs is proposed to be carried over to balance sheet.

Dividend

In view of good performance of your Company, your Directors are pleased to recommend a dividend of Rs. 2 per share for the year 2014-15. The total payout on dividend (including dividend tax), if the dividend is approved by the members at the Annual General Meeting, will be Rs. 659.25 Lacs during the year under review.

The dividend, if approved at the forthcoming Annual General Meeting, will be paid to shareholders whose names appear on the register of shareholders at the close of business on 4th September, 2015 and in respect of shares held in dematerialised form, it will be paid to members whose names are furnished by National Securities Depository Limited and Central Depository Services (India) Limited, as beneficial owners as on that date.

Share Capital

During the year the Board of Directors have at its Meeting held on 14th July, 2014 issued and allotted 12,00,000 warrants with an option to subscribe upto 12,00,000 Equity Shares of Rs. 10 each to M/s Riddhi Portfolio (P) Limited, Promoter group, on a preferential basis at a price of Rs. 150 per share.

Further, out of the Warrants issued on 19.01.2013, the Board has allotted 13,70,500 equity shares on 18.07.2014 by conversion of warrants to M/s. Eastern Credit Capital Pvt Ltd, promoter group at a price of Rs. 130 per share on a preferential basis.

On account of this allotment to M/s. Eastern Credit Capital Pvt Ltd, promoter group, the Issued, Subscribed and Paid up Share capital has been increased to Rs. 27,46,99,40 0 consisting of 2,74,69,940 Equity Shares of Rs. 10.

Project

The Company had embarked upon a project to manufacture front axle beams, crankshafts, stub axles and connecting rods (Products) on press lines. The Project consists of 12500 Ton pressline imported from SMS, Gmbh, 6300 Ton pressline, 4500 Ton press line and 3150 ton pressline. It also includes installation of state of the art Machining Centers and Heat Treatment facilities for supply of the machined Products. The Project will enhance the forging capacity of the Company by 80000 Tons.

The Company has already commenced commercial production of 3150 Ton pressline and 4500 Ton pressline on 21st July, 2014.The Company has also commenced hot trails of 12500 ton pressline from 10th May, 2015

Pollution Control Measures

Your Company has installed adequate pollution control equipment in all its units as per the legal requirement and has the requisite approvals from the concerned authorities.

Credit Rating

Your Company''s long term rating is BBB (Positive outlook) from CRISIL and A- (Stable outlook) from ICRA.

Details of Directors and Key Managerial Personnel

(A) Appointment of Independent Directors

Mr. Amitabha Guha and Ms. Aditi Bagri have joined the Company as Additional Independent Directors on 14.08.2014 and 1.11.2014 respectively for a period of 5 years. Their appointment will be placed for approval by the members at the forthcoming Annual General Meeting. As per the provisions of Section 149(1) of the Companies Act, 2013 and amended Clause 49 of the Listing Agreement, the Company is required to have atleast one Woman Director on its Board. The Company complies with the aforesaid requirement with the appointment of Ms. Aditi Bagri.

(B) Statement on declaration given by Independent Directors under sub-section (6) of section 149

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under the Act and Clause 49 of the Listing Agreement with the Stock Exchanges.

None of the Directors of the Company are disqualified for being appointed as Directors, as specified in section 164(2) of the Companies Act, 2013 and rule 14(1) of the Companies (Appointment and Qualification of Directors) Rules 2014.

(C) Familiarization Programme undertaken for Independent Directors

The details of programmes for familiarisation of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters are put up on the website of the Company at the link: http://ramkrishnaforgings.com/familiarisatio%20n-program-of-independent- directors.pdf.

(D) Resignation of Director(s) during the year

Mr. Ravi Lekhrajani, Nominee Director, resigned from the Directorship of the Company with effect from 15th January, 2015 as per the stipulations of Shareholders Agreement. Your Directors places on record the valuable contributions of Mr. Ravi Lekhrajani towards the progress of the Company during his association with the Company.

(E) Re-appointment of Directors retiring by rotation

In accordance with the provisions of the Companies Act, 2013 Mr. Naresh Jalan and Mr. Satish Kumar Mehta, Directors, retire by rotation and being eligible, offer themselves for reappointment at the ensuing Annual General Meeting. Their appointment will be placed for approval by the members at the Annual General Meeting .

(F) Key Managerial Personnel

The Board of Directors at its meeting held on 19th May, 2014, recognised and noted the Key managerial personnel pursuant to Section 203(1) of the Companies Act, 2013. No changes in the Key Managerial Personnel position took place during the year under review.

Remuneration Policy

The Nomination and Remuneration Committee has formulated a policy relating to the appointment, remuneration and removal of Directors, Key Managerial Personnel and other senior management personnel of the Company, in accordance with the provisions of Section 178 of the Act. The Remuneration policy for Directors, Key Managerial Personnel and senior management personnel of the Company is attached herewith and marked as Annexure A and is also available at the website of the company at the following link: http://ramkrishnaforgings.com/remuneration-policy.pdf.

Performance Evaluation

The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors which include criteria for performance evaluation of the non-executive directors and executive directors. On the basis of the policy for performance evaluation, a process of evaluation was followed by the Board for its own performance and that of its Committees and individual Directors.

Directors'' Responsibility Statement

Pursuant to the requirement under Section 134(5) of the Companies Act, 2013, with respect to Director''s Responsibility Statement, it is hereby confirmed that:

i) in the preparation of annual accounts for the year ended 31st March 2015, applicable accounting standards have been followed and there are no material departures;

ii) the Directors have selected such accounting policies and applied them consistently and made judgements 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 2014-2015 and of the profit or loss of the Company for that period;

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

iv) they have prepared the annual accounts for 2014-2015 on a going concern basis;

v) the Directors have laid down internal financial controls to be followed by the company and such internal financial controls are adequate and are operating effectively; and

vi) 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.

Subsidiaries

The Company has one Subsidiary i.e. Globe Forex & Travels Limited. It is a wholly owned subsidiary of the Company and is in Travelling, MICE & Leisure business. A brief operational performance is as below :

(Rs. in Lacs)

2014-15 2013-14

Revenue from operations 1,144.48 781.56

Profit for the year after meeting 355.78 194.35 all expenses (before Interest, Depreciation & Tax)

Less :

Interest 226.61 163.03

Depreciation & Amortization 42.15 15.65

Provision for Taxation 19.65 15.22

Net Profit 67.37 0.45

In accordance with the Accounting Standard AS-21 on consolidated financial Statements the audited consolidated financial statements are provided in the Annual Report. In addition the financial data of the subsidiary has been furnished under note 38 of the Consolidated Financial Statements and forms part of this Annual Report.

The Annual accounts of the subsidiary and other related detailed information will be kept at the Registered Office of the Company and also at the Registered Office of the subsidiary company and will be available to the investors seeking information at any time during the working hours of the Company except Saturday. Further as per section 136 of the Companies Act, 2013, the audited financial statements, including the consolidated financial statements and related information of the Company and audited accounts of each of the subsidiaries are available at our website at www.ramkrishnaforgings.com.

A Policy has been formulated for determining the Material Subsidiaries of the Company pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges. The said Policy has been posted on the Company''s website at the weblink http://ramkrishnaforgings.com/ material-subsidiary-company-policy.pdf.

However the Company does not have a Material unlisted Subsidiary.

The Company does not have any Joint Venture or Associate company and no Company has ceased to be a Subsidiary or Associate of the Company for the Financial Year 2014-2015.

During the Year there has been no change in the nature of the business carried by the Subsidiary Company.

Auditors

The Members at the 32nd Annual General Meeting held on 17th June 2014 had appointed M/s Singhi & Co, Chartered Accountants, as the Statutory Auditors of the Company pursuant to the provisions of Section 139, 142 and other applicable provisions, if any, of the Companies Act, 2013 to hold office from the conclusion of that Annual General Meeting till the conclusion of the 3rd consecutive Annual General Meeting, i.e. till the conclusion of the 35th Annual General Meeting, subject to ratification by the Members at every Annual General Meeting, at a remuneration to be decided by the Board of Directors. Accordingly, the Board recommends to the Members of the Company for ratification of the appointment of M/s Singhi & Co. Chartered Accountants as the Statutory Auditors of the Company. In this regard, M/s Singhi & Co, Chartered Accountants have submitted their written consent that they are eligible and qualified to be re-appointed as Statutory Auditors of the Company in terms of Section 139 of the Companies Act, 2013 and also satisfy the criteria provided in Section 141 of the Companies Act, 2013.

The Auditors'' Report to the shareholders for the year under review does not contain any qualifications or adverse remarks.

Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company had appointed M/s. MKB & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the Financial Year 2014-15. The Secretarial Audit Report is given as Annexure B forming part of this Report.

With regard to the qualification in the Secretarial Audit Report, the Management would like to state that the Chairman of the Audit Committee could not attend the Annual General Meeting held on 17th of June, 2014 as he was out of India. Similarly, the Chairman of the Nomination and Remuneration Committee could not attend the Annual General Meeting of the Company because of his ill health.

Cost Auditors

As per Section 148 and other applicable provisions of the Companies Act, 2013, the Board of Directors based on the recommendation of the Audit Committee had appointed M/s. U. Sharma and Associates, Cost Accountants, as Cost Auditors to carry out the audit of the Cost Records of the Company for the Financial Years 2014-15 and 2015-2016. As required under the Companies Act, 2013, the remuneration payable to the Cost Auditor is required to be placed before the Members in a general meeting for their ratification. The remuneration payable to M/s. U. Sharma & Associates , Cost Accountants, will be placed for approval by the members at the Annual General Meeting.

Risk Management Policy

The Company has a Risk Management Policy duly approved by its Board. Risk evaluation and management is an ongoing process within the organisation and is periodically reviewed by the Board of Directors.

Internal Financial Controls

The Company has in place adequate internal financial controls with reference to financial statements. The Company''s Internal Control Systems are commensurate with the nature, size and complexity of its business and ensure proper safeguarding of assets, maintaining proper accounting records and providing reliable financial information. Pursuant to the provisions of Section 138 of the Act read with Rule 13 of the Companies (Accounts) Rules 2014 M/s. Deloitte, Haskins & Sells are appointed as the Internal Auditor of the Company who also evaluates the functioning and quality of internal controls and reports its adequacy and effectiveness through periodic reporting.

CSR for your Company means Corporate Sustainable Responsibility and this means embedding CSR into its business model.

With the enactment of the Companies Act, 2013 and the Companies (Corporate Social Responsibility Policy) Rules, 2014, the Corporate Social Responsibility (CSR) Committee has formulated and recommended to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, which has been approved by the Board.

Your Company has launched two Programs under its CSR activity i.e Ramkrishna Jan Kalyan Yojana (RJKY) & Ramkrishna Shiksha Yojana (RSY).

Under the RJKY program, the Company among other things also intends to set up and run a Medical Centre in the Seraikela Kharsawan district in the State of Jharkhand which is supposed to have a full time doctors , Nurses, Medicine Shop and basic medical facilities and under the RSY Program, the Company intends to build and run a school so that the children of that region can be provided quality education at reasonable cost. Significant time was consumed in identification of the location and purchase of land for the medical centre and to finalise the modalities for setting up of the school . Thus the company could not spend any amount in CSR.

However the Company has during 2015-16 has already purchased land for the medical centre and have already spent Rs. 18.60 Lacs towards CSR expense.

Your Company as part of its CSR initiatives has initiated projects as per its CSR Policy.

The details of the CSR Activities are given as Annexure C forming part of this Report.

Related Party Transactions

The Company has formulated a Policy on dealing with Related Party Transactions. The Policy is disclosed on the website of the Company at the weblink: http://ramkrishnaforgings.com/policy-for-transactions-with-related-parti es.pdf. All transactions entered into with Related Parties as defined under the Companies Act, 2013 and Clause 49 of the Listing Agreement during the year were in the ordinary course of business and on an arms length basis. There are no materially significant related party transactions made by the Company with promoters, directors, key managerial personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

The details of the related Party transaction in Form AOC-2 is enclosed and marked as Annexure D.

All related party transactions are placed before the Audit Committee for its approval. In accordance with Accounting Standard 18, the Related Party Transactions are disclosed under Note No. 34 of the Standalone Financial Statements.

Stock Exchange

The Equity Shares of your Company were listed on two stock exchanges:

* National Stock Exchange of India Limited, Exchange Plaza, Plot no. C/1, G- Block, Bandra-Kurla Complex, Bandra (East), Mumbai 400 051.

* Bombay Stock Exchange Limited, Phiroze Jee jeeboy Towers, Dalal Street, Mumbai 400 001.

The Annual Listing Fees for the year 2015-16 are paid to both the stock exchanges where the shares of your Company are listed.

Management''s Discussion And Analysis Report

Management'' s Discussion and Analysis Report for the year under review under Clause 49 of the Listing Agreement with the Stock Exchange in India is presented in the separate section and forms part of the Annual Report.

Corporate Governance

Adoption of Best ethical business practices in the Company within the regulatory framework is the essence of good Corporate Governance. On one hand good Corporate Governance calls for accountability of the persons who are at the helm of affairs of the Company and on the other hand it also brings benefits to all stakeholders of the Company such as investors, customers, employees and the society at large. Your Company continues to believe in such business practices and gives thrust on providing reliable financial information, maintenance of transparency in all its business transactions and ensuring strict compliance of all applicable laws.

The report of Corporate Governance as stipulated under clause 49 of the Listing Agreement forms part of the Annual Report.

The requisite certificate from the Statutory Auditors of the Company, confirming the compliance with the conditions of corporate governance as stipulated under the aforesaid clause 49, is attached with the corporate governance report.

Disclosures

a) Meetings of Board of Directors

During the financial year ended 31st March, 2015, 7 (Seven) Board Meetings were held during the financial year under review on 19.05.2014, 30.06.2014, 14.07.2014, 18.07.2014, 14.08.2014, 01.11.2014 and 31.01.2015.The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

b) Meetings of Independent Directors

According to Clause 49 of the Listing Agreement, a separate meeting of the Independent Directors was held on 31st January,2015. In the meeting, the Directors reviewed the performance of Non-Independent Directors, the Chairman of the Board and the Board as a whole and further assessed the quality, quantity and the timeliness of flow of information between the Management and the Board.

c) Particulars of Loan & Investment

Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilized by the recipient are provided in the standalone financial statement. The details of loans, guarantees and Investments have been provided in Note no. 13(i), 14 and 44 to the Standalone Financial Statements.

d) Conservation Of Energy, Technology Absorption and Foreign Exchange Earnings And Outgo

The particulars relating to energy conservation, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under the Act is given in Annexure - E to this Report.

e) Extract of the Annual Return

Pursuant to the provisions of Section 134(3)(a) of the Companies Act, 2013 an extract of the Annual Return in Form MGT-9 is given in Annexure - F to this Report.

f) Particulars of Employees and related disclosures

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules are provided in the Annual Report alongwith the disclosure pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given in Annexure - G to this Report.

g) Whistle Blower Mechanism

The Company promotes ethical behaviour in all its business activities and has put in place a mechanism for reporting illegal or unethical behaviour. The Company has a Vigil mechanism and Whistle blower policy under which the employees and Directors are free to report violations of applicable laws and regulations and the Code of Conduct. The reportable matters may be disclosed to the Vigilance and Ethics officer who operates under the supervision of the Audit Committee. Employees may also report to the Chairman of the Audit Committee. During the year under review, no employee was denied access to the Audit Committee. The Vigil Mechanism / Whistle Blower Policy of the Company can be accessed at the website of the Company at the following link: http://ramkrishnaforgings.com/whistle-blower-policy.pdf.

h) Transfer of amounts to Investor Education and Protection Fund

Pursuant to the provisions of Section 205C of the Companies Act, 1956, the Company has transferred Rs. 32,341 to the Investor Education and Protection Fund being the unpaid and unclaimed Dividend amount for the financial year 2006-2007. Amount of dividend lying unclaimed and unpaid for the last 7 years as on 31st March, 2015 have been disclosed in the Corporate Governance Report.

Committees :

The Company has also formulated the under-mentioned Committees.

a) Audit Committee :

The Audit Committee of the Company consists of 3 Independent Directors - Mr. Yudhisthir Lal Madan, Mr. Amitabha Guha and Ms. Aditi Bagri. The Company Secretary acts as the Secretary of the Committee. The terms of reference of the Audit Committee has been furnished in the Corporate Governance Report forming a part of this Annual Report. There has been no instance where the Board has not accepted the recommendations of the Audit Committee.

b) Nomination and Remuneration Committee

The Company has a Nomination and Remuneration Committee as per Section 178 of the Companies Act, 2013 consisting of Mr. Padam Kumar Khaitan, Mr. Yudhisthir Lal Madan and Mr. Satish Kumar Mehta. The Company Secretary acts as the Company Secretary of the Committee.The Terms of reference of the Nomination and Remuneration Committee has been furnished in the Corporate Governnace Report forming a part of this Annual Report.

c) Stakeholder Relationship Committee

The Stakeholder Relationship Committee of the Company was formed as mandated by Section 178 of the Companies Act, 2013 to consider and resolve the grievances of security holders of the Company. The Committee consists of Mr. Satish Kumar Mehta and Mr. Yudhisthir Lal Madan as its members. The Company Secretary acts as the Secretary of the Committee. The Terms of reference of the Stakeholder Relationship Committee has been furnished in the Corporate Governnace Report forming a part of this Annual Report.

General

i. The Company has not accepted any deposit during the year.

ii. There have been no significant or material orders passed by the regulators or Courts or Tribunals impacting the going concern status and the company''s operations in future.

iii. During the year under review, the Company has not issued sweat equity shares.

iv. During the year under review, the Company has not issued shares with differential voting rights.

v. During the year under review, the Company has not issued Employee Stock Option.

vi. During the year under review, the Company did not buy back its shares.

vii. The Company has not revised any of its financial statements or reports.

viii. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.

Your Directors further state that during the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

Acknowledgement

Your Directors would like to express their sincere appreciation for the assistance and co-operation received from the financial institutions, banks, government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the Company''s executives, staff and workers.

On behalf of the Board

Place : Kolkata Mahabir Prasad Jalan Dated : 7th August, 2015 Chairman


Mar 31, 2014

The Directors are pleased to present the 32nd Annual Report of your Company along with the Audited Accounts for the financial year ended 31st March, 2014.

FINANCIAL HIGHLIGHTS 2013-2014 (Rs. in Lacs)

Particulars Year ended Year ended 31st March, 2014 31st March, 2013

Sales and Operating Income ( Net) 42,952.78 40,389.70

Other Income 238.69 132.97

Profit before Interest, Depreciation & Tax 5,996.47 6290.69

Finance Cost 2,226.38 2,168.28

Depreciation 2,491.79 2,262.21

Profit Before Tax 1,278.29 1,860.40

Provision for taxation:

- Current Tax 526.00 368.00

- MAT 0.00 (261.00)

- Deferred Tax (93.08) 654.40

- Income Tax of earlier years 0.12 (3.88)

Profit After Tax 845.25 1,102.88

Add: Surplus Brought Forward 9,195.60 8486.50

Surplus available 10,040.85 9589.38

Appropriations :

Dividend and Tax on Dividend paid for 2013-14

- Dividend 260.99 251.09

- Tax on Distributed Profits 44.36 42.69

- Transfer to General Reserve 50.00 100.00

Balance carried to Balance Sheet 9685.50 9195.60

FINANCIAL AND PERFORMANCE REVIEW

- Net Sales increased by 6.35 percent from Rs. 40389.70 Lacs in 2012-13 to Rs. 42952.78 Lacs in 2013-14.

- EBIDTA decreased by 4.68 percent from Rs. 6290.90 Lacs in 2012-13 to Rs. 5996.47 Lacs in 2013-14.

- PAT decreased by 23.36 percent from Rs. 1102.88 Lacs in 2012-13 to Rs. 845.25 Lacs in 2013-14

With the onset of the slowing industrial growth and weakening investment sentiment across sectors, the strong growth phase of the domestic Commercial Vehicle (CV) industry came to standing halt in 2013-14.

Medium & Heavy Commercial Vehicles (M&HCV) segment bore the brunt of slowing industrial activity with weak investment sentiment and the impact of significant fleet capacity addition over the past three years, especially in the heavy-duty categories of the trucking market.

The cumulative production of CV fell from 832649 vehicles in 2012-13 to 698864 vehicles in 2013-14 registering a fall of around 16.07%.

However, the production of M&HCVs segment registered a de-growth at 21.04 percent during the year 2013-14 and Light Commercial Vehicles registered a de-growth of 13.54 percent

The overall domestic sales of the CV segment registered a de-growth from 793211 vehicles in 2012-13 to 632738 vehicles in 2013-14 registering a de-growth of 20.23 percent. The M&HCVs segment registered a sharp downfall of 25.33 percent during the year 2013-14 and light commercial vehicles registered a de-growth of 17.62 percent.

In spite of the sluggish scenario of the CV segment your Company has been able to register and increase the net sales.

TRANSFER TO RESERVES

Your Company proposes to transfer Rs. 50.00 lacs to General Reserve out of the amount available for appropriation and an amount of Rs. 9,685.50 lacs is proposed to be carried over to balance sheet.

DIVIDEND

In view of the better performance of your Company, your Directors are pleased to recommend a dividend of Rs. 1 per share for the year 2013-14. The total payout on dividend (including dividend tax), if approved by the members, at the Annual General Meeting will be Rs. 305.35 lacs during the year under review.

SHARE CAPITAL

During the year the Company has at its Board Meeting held on 3rd April, 2013 issued and allotted 37,24,500 Equity shares to Wayzata II Indian Ocean Ltd at a price ofRs. 132.75 per share on a preferential basis.

Further, out of the warrants issued on 19.01.2013 to M/s. Eastern Credit Capital Pvt Ltd, Promoter group, at a price of Rs. 130 the Company during the year has issued and allotted 1279000 equity shares by conversion of warrants to M/s. Eastern Credit Capital Pvt Ltd, Promoter group, at a price of Rs. 130 per share on a preferential basis.

On account of this the Issued, Subscribed and Paid up Share capital has been increased to Rs. 2,609.94 Lacs.

PROJECT

The Company had embarked upon a Press Line Project (Project) to manufacture front axle beams, crankshafts, stub axles, knuckles and connecting rods. All the presses are expected to become operational during the financial year 2014-2015.The Installed capacity of the Company will significantly increase on account of this Project and the Company will be able to upgrade its product range from components to assemblies. This Project will also help the Company to increase its presence in the global market and help it reduce its dependence on the domestic commercial vehicle sector in India.

OPERATIONAL HIGHLIGHTS

Forgings and Machining facility

The Company derives the major share of its revenues from the commercial vehicle segment. Your Company produced 23,466 tons (incl. job work) during the year under review as compared to 25572 tons last year registering a decrease of about 8.23 percent. The Company has been able to utilise around 62.25 percent of the production capacity for the year as compared to around 67.80 percent capacity utilisation last year.

The Company has the-state-of-art of CNC Machining and Gear Cutting Facilities in which it has achieved accuracies of class 8 & 9 in hobbing stage class 7 in shaving stage and class 8 & 9 in hard stage as per DIN 3962 in gear manufacturing. The Company has made 72 new product development in the CNC machining, 19 new development in gear cutting, 30 new items in the VMC machining which has helped to enhance the product basket with existing clients and add new clients.

Ring Rolling Line

Ring Rolling is a cost-effective and efficient production process for production of ring-shaped components like crown wheels, bearing rings etc. The equipment is fully capable of meeting the requirements of the automobile industry, especially that of commercial vehicles (primarily medium and heavy vehicles).

The Company has produced 17794 tons during the year as compared to 15356 tons last year thus registering an increase of about 15.87 percent . Inspite of the weakness in the commercial vehicle segment it has achieved a capacity utilisation of around 74 percent during the year as compared to around 64 percent last year on account of good export demand.

The Company has developed 46 new products and has been able to enhance its export portfolio by adding new clients and enhancing its product range which will help to augment the export market of the Company and will also help to propel the growth in future.

CREDIT RATING

Your Company''s rating is BBB from ICRA and CRISIL as its Long term rating for its fund based facilities and A2 for its Commercial Paper/Short Term Debt from ICRA Ltd.

EMPLOYEES STOCK OPTION SCHEME

Pursuant to the approval accorded by the shareholders on 22nd August, 2009, your Company has formulated the Employee Stock Option Scheme, (ESOS) 2009, for the benefit of the permanent employees including Directors ,whether whole time or not but excluding the promoters of the Company. The said scheme is administered by the Remuneration and Compensation Committee of the Board through a Trust. Under the said scheme 4,68,159 stock options was initially granted at an exercise price of Rs. 20 per share. The stock options granted to eligible employees are, interalia, performance linked options. In accordance with SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines 1999 (hereinafter "SEBI guidelines"), the details in relation to the options granted, vested exercised, lapsed etc. under ESOS, 2009, as on 31st March, 2014 are given as under :

Description ESOS 2009

Total number of options granted 468159 options

Pricing formula/exercise price Rs. 20

Total Number of options vested 369235

Number of options exercised during the year 201109

Total no. of shares arising as a result of exercise of option Nil

Total number of options Lapsed/Forfeited 98924

Variation in terms of option NA

Money realised by exercise of option Rs. 40,22,180

Total no. of options in force NIL

Grant to senior managerial personnel No options were granted during the year

Grant to non- executive director under the scheme No options were granted during the year

Employees who were granted 5 % or more of the total No options were granted during the year number of options granted during the year

Employees who were granted options equal to exceeding No options were granted during the year 1% of the issued capital of the Company at the time of grant

Diluted Earning per share pursuant to issue of shares on exercise of option calculated in accordance with AS 20

Difference between the employee compensation cost Intrinsic Value : Rs. 8.44 Lacs

computed using the intrinsic value of stock options and Fair Value : Rs. 8.78 Lacs the employee compensation cost that shall have been Difference : Rs. 0.34 Lacs recognized had the fair value of options, were used

Impact of this difference on profits of the Company The Profits would decrease byRs. 0.34 Lacs

Impact of this difference on EPS of the Company There would be no change in the basic and diluted EPS

Weighted average exercise price NIL

Weighted average fair value of options for options whose NIL exercise price either equals or exceeds or is less than the market price of the share

The Company has received a certificate from the Statutory Auditors of the Company that the Scheme has been implemented in accordance with the SEBI Guidelines and the resolution passed at the Annual General Meeting held on 22nd August, 2009. The Certificate will be placed at the Annual General Meeting for inspection by members.

SUBSIDIARY AND CONSOLIDATED FINANCIAL RESULTS

The Company has a wholly owned Subsidiary Company, viz., Globe Forex and Travels Limited.

The Ministry of Corporate Affairs, Government of India, has granted a general exemption to companies, by general circular no. 2/2011 dated 8th February, 2011 under section 212(8) of the Companies Act,1956 from attaching individual accounts of subsidiaries with their annual accounts, subject to fulfilment of certain conditions. Accordingly the Board of Directors of the Company has by resolution given consent for not attaching the Balance Sheet, Statement of Profit and Loss and other documents of the subsidiary companies in the Annual Report of the Company for the financial year ended 31st March, 2014.

In accordance with the Accounting Standard AS-21 on consolidated financial Statements the audited consolidated financial statements are provided in the Annual Report. In addition the financial data of the subsidiary has been furnished under the head "Financial Information of Subsidiary Company" and forms part of this Annual Report.

The annual accounts of the subsidiary and other related detailed information will be kept at the registered office of the Company and also at the registered office of the subsidiary company and will be available to the investors seeking information at any time.

MANAGEMENT''S DISCUSSION AND ANALYSIS REPORT

Management''s Discussion and Analysis Report for the year under review under clause 49 of the Listing Agreement with the Stock Exchange in India is presented in the separate section forming part of the Annual Report.

POLLUTION CONTROL MEASURES

Your Company has installed adequate pollution control equipment in all its units as per the legal requirement and has the requisite approvals from the concerned authorities.

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

The particulars relating to energy conservation, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is given in "Annexure -A" to this Report.

FIXED DEPOSITS

During the year Company has not accepted any Fixed Deposit within the meaning of Section 58A of the Companies Act, 1956 and as such, no amount of principal or interest on account of Fixed Deposits is outstanding, as on the date of Balance Sheet.

STOCK EXCHANGE

The Equity Shares of your Company were listed on two stock exchanges :

- National Stock Exchange of India Limited, Exchange Plaza, Plot no. C/1, G- Block, Bandra-Kurla Complex, Bandra (East), Mumbai 400 051.

- Bombay Stock Exchange Limited, Phiroze Jee jeeboy Towers, Dalal Street, Mumbai 400 001.

The Annual Listing Fees for the year 2014-15 are paid to both the stock exchanges where the shares of your Company are listed.

AUDITORS

M/s Singhi & Co, Chartered Accountants, Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. The Members are requested to consider their appointment as the Statutory Auditors of the Company from the conclusion of this Annual General Meeting until the conclusion of the Thirty Fifth (35th) Annual General Meeting of the Company on such remunerations as approved by the members.

The Company has received a certificate from the proposed Auditors to the effect that their appointment, if made, would be in accordance with all the conditions prescribed under the Companies Act,2013 and the Companies (Audit and Auditors) Rules, 2014.

With regard to the matter of emphasis in the Auditor''s Report the Note no. 29 of the standalone accounts of the Company are self-explanatory and therefore does not call for any further comments.

COST AUDITORS

Pursuant to the directives of the Central Government under the provisions of section 233B of the Companies Act, 1956, M/s. U. Sharma & Associates has been appointed to conduct the cost audit.

DIRECTORS

In accordance with the provisions of the Companies Act, 2013 and as per the Articles of Association of the Company Mr. Pawan Kumar Kedia, Director, will retire by rotation at the ensuing Annual General Meeting and being eligible, offers himself for reappointment.

As per provisions of Sections 149, 150, 152 and any other applicable provisions of the Companies Act, 2013 and the rules made thereunder read with Schedule IV to the Companies Act, 2013, Mr. Padam Kumar Khaitan (DIN: 00019700), Mr. Ram Tawakya Singh (DIN: 00276330) and Mr. Yudhisthir Lal Madan (DIN: 05123237), all existing Independent directors of the company, have been appointed as an Independent Directors of the Company and shall hold office from the date of this Annual General Meeting till 31st March, 2019. They shall not, henceforth, be liable to determination by retirement of directors by rotation.

Mr. Surendra Mohan Lakhotia ceased to be a director of the Company on account of his death.

Your Directors places on record their appreciation for the valuable contributions of Mr. Surendra Mohan Lakhotia towards the progress of the Company during his association with the Company.

None of the Directors of the Company are disqualified for being appointed as Directors, as specified in section 274 (1)(g) of the Companies Act, 1956.

COMMITTEES OF DIRECTORS

The Board of Directors have aligned the existing Committees of the Board with the provisions of Companies Act, 2013 (Act). Accordingly, the Company has renamed its existing Remuneration and Compensation Committee as Nomination and Remuneration Committee and have delegated to it powers as required under section 178 of the Act. The existing Shareholders and Investor Grievance Committee has been renamed as "Stakeholders Relationship Committee".

The scope of Audit Committee has also been widened so as to bring it in accordance with the requirement of the Section 177 of the Companies Act, 2013.

The Company has also constituted a Corporate Social Responsibility Committee as required under Section 135 of the Companies Act, 2013.

CORPORATE GOVERNANCE

Adoption of Best ethical business practices in the Company within the regulatory framework is the essence of good Corporate Governance. On one hand good Corporate Governance calls for accountability of the persons who are at the helm of affairs of the Company and on the other hand it also brings benefits to all stakeholders of the Company such as investors, customers, employees and the society at large. Your Company continues to believe in such business practices and gives thrust on providing reliable financial information, maintenance of transparency in all its business transactions and ensuring strict compliance of all applicable laws.

The report of Corporate Governance as stipulated under Clause 49 of the Listing Agreement forms part of the Annual Report.

The requisite certificate from the Statutory Auditors of the Company, confirming the compliance with the conditions of Corporate Governance as stipulated under the aforesaid Clause 49, is attached with the Corporate Governance report.

The Company has established a vigil mechanism as required under Section 177 of the Companies Act, 2013 and has framed the "Whistle Blower Policy" for implementation thereof. The said policy has been uploaded on the website of the Company.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to Director''s Responsibility Statement, it is hereby confirmed that :

i) In the preparation of annual accounts for the year ended 31st March 2014, applicable accounting standards have been followed along with proper explanations relating to material departures;

ii) The Directors have selected such accounting policies and applied them consistently and made judgements 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 2013-2014 and of the profit or loss of the Company for that period;

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

iv) They have prepared the annual accounts for 2013-2014 on a going concern basis.

PARTICULARS OF EMPLOYEES

The information as required in terms of the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) t Rules, 1975 as amended forms part of this Report as "Annexure B".

TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to the provisions of Section 205C of the Companies Act,1956, unpaid application amount , dividends which remained unpaid or unclaimed for a period of 7 years have been transferred by the Company to the Investor Education and Protection Fund.

CORPORATE SOCIAL RESPONSIBILITY

The responsibility of the Company is to make a positive impact on the communities in which the company does business through its support of select programs, outreach efforts and initiatives that improve and enhance the quality of life. Our goal is to make things better for the planet, better for people, better for business, better now, better for the future.

Your company believes in the principle of symbiotic relationship with the local communities, recognizing that business ultimately has a purpose - to serve human needs. Close and continuous interaction with the people and communities in and around the manufacturing divisions has been the key focus while striving to bring around qualitative changes and supporting the underprivileged.

The Company has helped to organise various camps and will ensure that more steps are taken in this regard.

The Company has constituted a Corporate Social Responsibility Committee as required under Section 135 of the Companies Act, 2013.

APPRECIATION

Your Directors would like to convey their appreciation for all the co-operation and assistance received from the government authorities, financial institutions, banks, customers, vendors and stakeholders of the Company during the year under review. Your Directors also express their deep sense of appreciation for the committed services by the executives, staff and workers of the Company. We look forward to receiving the continued patronage of all our business partners to become a better and stronger company.

On behalf of the Board

Place : Kolkata Mahabir Prasad Jalan

Dated : 19th May, 2014 Chairman


Mar 31, 2013

The Directors are pleased to present the 31st Annual Report of your Company along with the Audited Accounts for the financial year ended 31st March, 2013.

FINANCIAL HIGHLIGHTS 2012-2013

(Rs.in Lakhs)

Particulars Year ended Year ended 31st March, 2013 31st March, 2012

Sales and Operating Income (Gross) 40,389.70 50126.29

Other Income 132.97 76.50

Profit before Interest, Depreciation & Tax 6165.09

Finance Cost 2,042.48 1878.89

Depreciation 2,262.21 2706.74

Profit Before Tax 1,860.40 3584.52

Provision for taxation:

-Current Tax 368.00 1049.00

- MAT (261.00)

-Deferred Tax 654.40 85.50

-Income Tax of earlier years (3.88) 21.10

Profit After Tax 1,102.88 2428.92

Add: Surplus Brought Forward 8486.50 6686.51

Surplus available 9589.38 9115.43

Appropriations:

Dividend and Tax on Dividend paid for 2010-11 22.08

- Transfer to General Reserve 100.00 185.00

- Dividend 251.09 362.97

-Tax on Distributed profits 42.69 58.88

Balance carried to Balance Sheet 9195.60 8486.50

Financial and Performance Review

Net Sales decreased by 19.42 percent from 501.26 Cr in 2011-12 to Rs. 403.90 Cr in 2012-13.

EBIDTA decreased by 24.54 percent from Rs.81.70 Cr in 2011-12 to Rs. 61.65 Cr in 2012-13. . PAT decreased by 54.58 percent from Rs.24.28 Cr in 2011-12.to Rs.11.03 cr in 2012-13.

With the onset of the slowing industrial growth and weakening investment sentiment across sectors, the strong growth phase of the domestic commercial vehicle (CV) industry came to standing halt in 2012-13.

M&HCV segment bore the brunt of slowing industrial activity with weak investment sentiment and the impact of significant fleet capacity addition over the past three years, especially in the heavy-duty categories of the trucking market. Within the M&HCV segment, while buses saw a recovery in volumes compared to the previous year on back of healthy off take from private segment and improving order inflows from STUs, the contraction in demand for the higher tonnage category of trucks such as tippers, tractor trailers and multi-axle vehicles (MAVs) has been the sharpest.

The cumulative production of commercial vehicles fell from 929136 vehicles in 2011-12 to 831744 vehicles in 2012-13 registering a fall of around 10.48%.

However the production of medium & heavy commercial vehicles (M&HCVs) segment registered a de-growth at 27.61 percent during the year 2012-2013 and light commercial vehicles registered a marginal growth of 1.63 percent

The overall domestic sales of the commercial vehicles segment registered a de-growth from 809499 vehicles in 2011-12 to 793150 vehicles in 2012-13 registering a de-growth of 2.02 percent. The medium & heavy commercial Vehicles (M&HCVs) segment registered a sharp downfall of 23.18 percent during the year 2012-2013 but light commercial vehicles managed to register a growth of 14.04 percent.

Transfer to Reserves Your Company proposes to transfer Rs.100 lakhs to General Reserve out of the amount available for appropriation and an amount of Rs.9195.60 lakhs is proposed to be carried over to balance sheet.

Dividend

In view of the better performance of your Company, your Directors are pleased to recommend a dividend of Re.l per share for the year 2012-13. The total payout on dividend (including dividend tax), if the dividend is approved by the members at the Annual General Meeting, will be rS. 293.78 lakhs during the year under review.

Share Capital

During the year the Company at its Board Meeting held on 19th January, 2013 has allotted 2148400 equity shares to International Finance Corporation at a price of rS. 128 per share & 781000 equity shares to M/s. Eastern Credit Capital (P) Limited (formerly Eastern Credit Capital Limited), Promoter at a price of rS. 128 per share on a preferential basis.

The Company has also issued 30,77,000 warrants to M/s. Eastern Credit Capital (P) Limited (formerly Eastern Credit Capital Limited), Promoter on a preferential basis at a price of rS. 130 per warrant at the Board Meeting held on 19th January, 2013. The Company at its Board Meeting held on 30th March, 2013 has allotted 18,000 equity shares of rS. 10 each by conversion of 18,000 warrants to M/s. Eastern Credit Capital (P) Limited (formerly Eastern Credit Capital Limited), Promoter. Consequently the issued, subscribed and paid up capital increased from 1814.85 Lakhs to rS. 2109.59 lakhs during the year.

The Company has further allotted 37,24,500 equity shares to Wayzata II Indian Ocean Ltd ,Foreign Body Corporate, at a price of rS. 132.75 per share on a preferential basis on 3rd April, 2013. A further request was received for the conversion of 289000 warrants into equity shares from M/s. Eastern Credit Capital (P) Limited (formerly Eastern Credit Capital Limited), Promoter group, along with the balance consideration of 75% of the issue price of rS. 130 per share.

Consequently after the allotment the issued , subscribed and paid up capital increased from 2109.59 Lakhs to rS. 2510.94 lakhs.

Project:

The Company has embarked upon a project to manufacture front axle beams, crankshafts, stub axles and connecting rods on press lines. The Company has procured 12500 ton press line from SMS Meer Gmbh and the same is expected to be shipped by end of June, 2013. The other press as envisaged in the project has also been procured.

The financial closure for the project has been accomplished and the equity as mentioned above has been raised for this project. The commercial production from the 12500 ton pressline is expected to commence from September, 2014.

Operational Highlights

Forgings and Machining facility

The Company derives the major share of its revenues from the commercial vehicle segment. Your Company produced 25572 tons (incl.job work) during the year under review as compared to 37721 tons last year registering a decrease of about 32.20 %. The Company has been able to utilise around 67.80 percent of the production capacity for the year as compared to about full capacity utilisation last year.

The Company has the-state-of-art of CNC Machining and Gear Cutting Facilities in which it has achieved accuracies of class 7 in the shaving stage and Class 8 & 9 in the hard and hobbing stage as per DIN 3962 in gear manufacturing. The Company has made 99 new product development in the CNC machining, 49 new development in gear cutting and 36 new items in the, VMC machining which has helped to enhance the product basket with existing clients and add new clients.

Ring Rolling Line

Ring rolling is a cost-effective and efficient production process for production of ring-shaped components like crown wheels, bearing rings etc. The equipment is fully capable of meeting the requirements of the automobile industry, especially that of commercial vehicles (primarily medium and heavy vehicles).

The Company has produced 15356 tons during the year as compared to 18168 tons last year thus registering a decline of about 15.47 percent. It has achieved a capacity utilisation of around 64 percent during the year as compared to around 75 percent last year on account of lower demand from the commercial vehicle segment. The Company has developed 32 new products and has been able to enhance its export portfolio by adding new clients and enhancing its product range which will help to augment the export market of the company and will also help to propel the growth in future.

Credit Rating

Your Company''s rating is A- from ICRA and CRISIL for its fund based facilities and Al for its Commercial Paper/Short Term Debt from ICRA Ltd. Employees Stock Option Scheme

The Company has received a certificate from the Auditors of the Company that the Scheme has been implemented in accordance with the SEBI Guidelines and the resolution passed at the Annual General Meeting held on 22nd August, 2009. The Certificate will be placed at the Annual General Meeting for inspection by members.

Subsidiary and Consolidated Financial Results

During the year the company has acquired and subscribed to equity shares representing 72.82% of the paid up share capital of Globe Forex and Travels Limited. It has become the subsidiary of the company pursuant to section 4 of the Companies Act,1956w.e.f 10th January, 2013.

The Ministry of Corporate Affairs, Government of India, has granted a general exemption to companies, by general circular no. 2/2011 dated 8th February,2011 under section 212(8) of the Companies Act,1956 from attaching individual accounts of subsidiaries with their annual accounts, subject to fulfilment of certain conditions. Accordingly the Board of Directors of the Company has by resolution given consent for not attaching the Balance Sheet, Statement of Profit and Loss and other documents of the subsidiary companies in the Annual Report of the Company for the financial year ended 31st March, 2013.

In accordance with the Accounting Standard AS-21 on consolidated financial Statements the audited consolidated financial statements are provided in the Annual Report. In addition the financial data of the subsidiary has been furnished under the head " Financial Information of Subsidiary Company " and forms part of this Annual Report.

The Annual accounts of the subsidiary and other related detailed information will be kept at the Registered Office of the Company and also at the Registered Office of the subsidiary company and will be available to the investors seeking information at any time.

Management''s Discussion And Analysis Report

Management'' s Discussion and Analysis Report for the year under review under clause 49 of the Listing Agreement with the Stock Exchange in India is presented in the separate section forming part of the Annual Report.

Pollution Control Measures Your Company has installed adequate pollution control equipment in all its units as per the legal requirement and has the requisite approvals from the concerned authorities.

Conservation Of Energy, Technology Absorption, And Foreign Exchange Earnings And Outgo

The particulars relating to energy conservation, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under section 217(l)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is given in "Annexure - A" to this Report.

Fixed Deposits

During the year Company has not accepted any Fixed Deposit within the meaning of Section 58A of the Companies Act, 1956 and as such, no amount of principal or interest on account of Fixed Deposits is outstanding, as on the date of Balance Sheet.

Stock Exchange

The Equity Shares of your Company were listed on two Stock Exchanges :

National Stock Exchange of India Limited, Exchange Plaza, Plot no. C/l, G- Block, Bandra-Kurla Complex, Bandra (East), Mumbai400 051.

Bombay Stock Exchange Limited, Phiroze Jee jeeboy Towers, Dalai Street, Mumbai 400 001.

The Annual Listing Fees for the year 2013-14 are paid to both the Stock Exchanges where the shares of your Company were listed.

Auditors

M/s Singhi & Co, Chartered Accountants, Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. The members are requested to consider their reappointment as Auditors of the Company for the year 2013-14 and authorise the Board of Directors to fix their remuneration.

The Company has received a certificate from the proposed Auditors to the effect that their appointment, if made, would be within the prescribed limits under Section 224 (IB) of the Companies Act, 1956. With regard to the comments in the Auditor''s Report the notes on accounts are self-explanatory and therefore does not call for any further comments.

Cost Auditors

Pursuant to the directives of the Central Government under the provisions of Section 233B of the Companies Act, 1956, M/s. U. Sharma and Associates has been appointed to conduct the cost audit.

Directors

In accordance with the provisions of the Companies Act, 1956 and as per the Articles of Association of the Company, Mr. Mahabir Prasad Jalan, Mr. Surendra Mohan Lakhotia and Mr Satish Kumar Mehta, Directors, retire by rotation and being eligible, offer themselves for reappointment at the ensuing Annual General Meeting

Mr. Subhasis Majumdar resigned from the Board of Director. Your Directors place on record the appreciation of the valuable services rendered by him to the Company during his association with the Company.

Mr. Ravi Lekhrajani has been appointed as Additional Director of the Company till conclusion of the next Annual General Meeting of the Company and the Company has received a notice in writing proposing his candidature for the office of a Director not liable to retire by rotation.

The re-appointment of Mr. Pawan Kumar Kedia as the whole time director of the Company for the period of 3 years w.e.f 1st April,2013 has been proposed.

None of the Directors of the Company are disqualified for being appointed as Directors, as specified in section 274 (l)(g) of the Companies Act, 1956.

Corporate Governance

Adoption of Best ethical business practices in the Company within the regulatory framework is the essence of good Corporate Governance. On one hand good Corporate Governance calls for accountability of the persons who are at the

helm of affairs of the Company and on the other hand it also brings benefits to all stakeholders of the Company such as investors, customers, employees and the society at large. Your Company continues to believe in such business practices and gives thrust on providing reliable financial information, maintenance of transparency in all its business transactions and ensuring strict compliance of all applicable laws.

The report of Corporate Governance as stipulated under Clause 49 of the Listing Agreement forms part of the Annual Report.

The requisite certificate from the Statutory Auditors of the Company, confirming the compliance with the conditions of Corporate Governance as stipulated under the aforesaid Clause 49, is attached with the Corporate Governance Report.

Directors''Responsibility Statement

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to Director''s Responsibility Statement, it is hereby confirmed that: i) In the preparation of annual accounts for the year ended 31st March, 2013, applicable Accounting Standards have been followed along with proper explanations relating to material departures;

ii) The Directors have selected such accounting policies and applied them consistently and made judgements 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 2012-2013 and of the profit or loss of the Company for that period;

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

iv) They have prepared the annual accounts for 2012-2013 on a going concern basis.

Particulars of Employees

The information as required in terms of the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended forms part of this Report as "Annexure B".

Transfer of amounts to Investor Education and Protection Fund

Pursuant to the provisions of Section 205C of the Companies Act,1956, unpaid application amount, dividends which remained unpaid or unclaimed for a period of 7 years have been transferred by the Company to the Investor Education and Protection Fund.

Corporate Social Responsibility

The responsibility of the Company is to make a positive impact on the communities in which the company does business through its support of select programs, outreach efforts and initiatives that improve and enhance the quality of life. Our goal is to make things better for the planet, better for people, better for business, better now, better for the future.

Your company believes in the principle of symbiotic relationship with the local communities, recognizing that business ultimately has a purpose - to serve human needs. Close and continuous interaction with the people and communities in and around the manufacturing divisions has been the key focus while striving to bring around qualitative changes and supporting the underprivileged

The Company has helped to organise various camps and will ensure that more steps are taken in this regard.

Appreciation

Your Directors would like to convey their appreciation for all the co-operation and assistance received from the Government authorities, financial Institutions, Banks, customers, vendors and stakeholders of the Company during the year under review. Your Directors also express their deep sense of appreciation for the committed services by the executives, staff and workers of the Company. We look forward to receiving the continued patronage of all our business partners to become a better and stronger company.

On behalf of the Board

Place :Kolkata Mahabir Prasad Jalan

Dated :18th May, 2013 (Chairman)


Mar 31, 2012

The Directors are pleased to present the 30th Annual Report of your Company along with the Audited Accounts for the financial year ended 31st March, 2012.

FINANCIAL HIGHLIGHTS 2011-2012 (Rs in Lakhs)

Particulars Year ended Year ended 31st March, 2012 31st March, 2011

Sales and Operating Income(Gross) 50,126.29 40,968.61

Other Income 65.30 146.38 Profit before Interest, Depreciation & Tax 8,170.15 7,078.58

Finance Cost 1,878.89 1,649.26

Depreciation 2,706.74 2,097.89

Profit Before Tax 3,584.52 3,331.43

Provision for Taxation :

-Current Tax 1,049.00 924.00

- Deferred Tax 85.50 194.00

-Income Tax of earlier years 21.10 7.50

Profit After Tax 2,428.92 2,205.93 Add:Surplus Brought Forward 6,686.51 5,032.45

Surplus available 9,115.43 7,238.38

Appropriations:

Dividend and Tax on Dividend paid for 2010-11 22.08 Nil

Transfer to General Reserve 185.00 170.00

Dividend 362.97 328.57

Tax on Distributed profits 58.89 53.30

Balance carried to Balance Sheet 8,486.49 6,686.51

Financial and Performance Review

- Net Sales increased 22.35% from Rs 409.68 Crores in 2010-11 to Rs 501.26 Crores in 2011-12.

- EBIDTA increased 15.41% from Rs 70.79 Crores in 2010-11 to Rs 81.70 Crores in 2011-12.

- PBT increased 7.60% from Rs 33.31 Crores in 2010-11 to Rs 35.84 Crores in 2011-12.

- PAT increased 10.06% from Rs 22.06 Crores in 2010-11 to Rs 24.28 Crores in 2011-12.

- Cash Profit increased by 16.07% from 44.98 Crores in 2010-11 to Rs 52.21 Crores in 2011-12.

In 2011-2012, production of passenger vehicles segment, commercial vehicles segment, three wheelers segment and two wheelers segment grew by 4.72%, 19.83%, 9.78% and 15.76% respectively.

The cumulative production of commercial vehicles grew from 7,60,735 vehicles in 2010-11 to 9,11,574 vehicles in 2011-12 registering a growth of around 19.8%.

The overall domestic sales of the commercial vehicles segment registered an increase from 6,84,905 vehicles in 2010-11 to 8,09,532 vehicles in 2011-12 registering a growth of 18.20%. The medium & heavy commercial Vehicles (M&HCVs) segment registered growth at 7.94% during the year 2011-2012 and Light Commercial Vehicles registered a growth of 27.36%.

TRANSFER TO RESERVES

Your Company proposes to transfer Rs 185 Lakhs to General Reserve out of the amount available for appropriation and an amount of Rs 8,486.49 Lakhs is proposed to be carried over to balance sheet.

DIVIDEND

In view of the better performance of your Company, your Directors are pleased to recommend a dividend of Rs 2 per share for the year 2011-12. The total payout on dividend (including dividend tax), if the dividend is approved by the members at the Annual General Meeting, will be Rs 421.85 Lakhs during the year under review.

SHARE CAPITAL

Out of 10,00,000 warrants issued to Ms. Lata Bhanshali and 29,00,000 warrants to M/s. Eastern Credit Capital (P) Limited (formerly Eastern Credit Capital Limited), Promoter group on a preferential basis at a price of Rs 107.50 per warrant during the year 2009-2010, the Company at its Board Meeting held on 4th April, 2011, has allotted 9,50,000 equity shares of Rs 10 each by conversion of 9,50,000 warrants to M/s. Eastern Credit Capital (P) Limited (formerly Eastern Credit Capital Limited), Promoter group.

During the year the Company had further received a request for the conversion of 7,70,000 warrants into equity shares from M/s. Eastern Credit Capital (P) Limited (formerly Eastern Credit Capital Limited), Promoter group, along with the balance consideration of 75% ofthe issue price ofRs 107.50 amounting to Rs 620.81 Lakhs. The Company at its Board Meeting held on 19th August, 2011 has allotted 7,70,000 equity shares ofRs 10 each to M/s. Eastern Credit Capital (P) Limited (formerly Eastern Credit Capital Limited), Promoter group by conversion of 7,70,000 warrants into equity shares of Rs 10 each.

During the year the Company has forfeited 10,00,000 warrants issued to Mrs. Lata Bhanshali and 11,80,000 warrants issued to M/s. Eastern Credit Capital (P) Limited (formerly Eastern Credit Capital Limited) and credited Rs 585.87 Lakhs being 25% of the consideration received in respect of 21,80,000 warrants to Capital Reserve and for which the Issued Capital reduced from Rs 2,032.85 Lakhs to Rs 1,814.85 Lakhs during the year.

On account of allotment of equity shares by conversion of the warrants into equity shares the subscribed and paid up share capital increased from Rs 1,642.85 Lakhs to Rs 1,814.85 Lakhs.

OPERATIONAL HIGHLIGHTS

Forgings and Machining facility

The Company derives the major share of its revenues from the commercial vehicle segment. Your Company produced 37,721 tons (incl. job work) during the year under review as compared to 31,234.46 tons last year registering an increase of about 20.75%. The Company has been able to utilise the production capacity to its full for the year as compared to 89.24% last year.

The Company has shored up its raw material cutting facilities to facilitate smooth flow of production and reduce its cost of operations by installing fully automatic horizontal bandsaw machine from Amada Machine Tools, Japan.

The Company had augmented its Machining Facilities by procuring two CNC 5 Gear Hobbing Machines, CNC 4 Gear Shaping and CNC 6 Gear Shaping Machine from Mitsubishi Heavy Industries Limited, Japan which will help the Company to provide more value added products with better precision to OEM's and to broad base the spectrum of products supplied to OEMS's. It will also balance the capacity utilisation of the Heat Treatment facilities.

The Company has the-state-of-art of CNC Machining and Gear Cutting Facilities in which it has achieved accuracies of class 6 in the soft stage and Class 8&9 in the hard stage as per DIN 3962 in gear manufacturing. The Company has also made 85 new product development during the year in the CNC Turning and Gear cutting area which has helped to enhance the product basket with existing clients and add new clients.

Ring Rolling Line

Ring rolling is a cost-effective and efficient production process for production of ring-shaped components like crown wheels, bearing rings etc. The equipment is fully capable of meeting the requirements of the automobile industry, especially that of commercial vehicles (primarily medium and heavy vehicles).

The Company has produced 18,168 tons during the year as compared to 16,438 tons last year thus registering a growth of about 10.50%. The Company has achieved a capacity utilisation of around 75% during the year as compared to around 68.50% last year on account of improved export performance of the Company. The improvement in the performance of the ring rolling facilities helped the Company to report better topline and improved margins. The Company has been able to add two more export clines which will help to augment the export market of the Company in future.

CREDIT RATING

Your Company rating has been upgraded from LBBB last year to A- from ICRA and CRISIL for its fund based facilities and from A2 to A1 for its Commercial Paper/Short Term Debt from ICRA Ltd.

EMPLOYEES STOCK OPTION SCHEME

Pursuant to the approval accorded by the shareholders on 22nd August, 2009, your Company has formulated the Employee Stock Option Scheme, (ESOS) 2009, for the benefit of the permanent employees including Directors, whether whole time or not but excluding the promoters of the Company. The said scheme is administered by the Remuneration and Compensation Committee of the Board through a Trust. Under the said scheme 4,68,159 stock options were initially granted at an exercise price of Rs 20/- per share. The stock options granted to eligible employees are, interalia, performance linked options and the exercise period would commence from the date of vesting and will expire on completion of 4 years from the date of vesting of options.

In accordance with SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 (hereinafter "SEBI guidelines"), the details in relation to the options granted, vested exercised, lapsed etc. under ESOS, 2009, as on 31st March, 2012 are given as under:

Description ESOS 2009

Total Number of options granted 4,68,159 options

Pricing formula/Exercise price Rs 20/-

Number of options vested 1,21,274

Number of options exercised 80,273

Total No. of Shares arising as a result of exercise of option Nil

Options Lapsed 70,650

Variation in terms of Option NA

Money realised by exercise of option Rs 16,05,460

Total No. of Options in force 3,17,236

Grant to Senior Managerial personnel No options were granted during the year

Grant to Non Executive Director under the scheme No options were granted during the year

Employees who were granted 5% or more of the total No options were granted during the year number of options granted during the year

Employees who were granted options equal to or exceeding No options were granted during the year 1% of the issued capital of the Company at the time of grant

Diluted Earning per share pursuant to issue of shares on N.A. exercise of option calculated in accordance with AS 20

Difference between the Employee compensation cost Intrinsic Value : Rs 67.00 Lakhs Computed using the intrinsic Value of stock options and Fair Value : Rs 38.84Lakhs the employee compensation cost that shall have been Difference : Rs 28.16 Lakhs recognized had the fair value of options, were used

Impact of this difference on profits of the Company The Profits would increase by Rs 28.16 Lakhs Impact of this difference on EPS of the Company The basis and diluted EPS would increase from Rs 13.61 of 13.77

Weighted average exercise price NIL

Weighted average fair value of options for options NIL

whose exercise price either equals or exceeds or is less than the market price of the share

Description of the Method and significant assumptions No options were granted during the year used during the year to estimate the fair value of Options granted during the year

The Company has received a certificate from the Auditors of the Company that the Scheme has been implemented in accordance with the SEBI Guidelines and the resolution passed at the Annual General Meeting held on 22nd August, 2009. The Certificate will be placed at the Annual General Meeting for inspection by members.

MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT

Management's Discussion and Analysis Report for the year under review under Clause 49 of the Listing Agreement with the Stock Exchange in India is presented in the separate section forming part of the Annual Report.

POLLUTION CONTROL MEASURES

Your Company has installed adequate pollution control equipment in all its units as per the legal requirement and has the requisite approvals from the concerned authorities.

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

The particulars relating to energy conservation, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is given in "Annexure - A" to this Report.

FIXED DEPOSITS

During the year Company has not accepted any Fixed Deposit within the meaning of Section 58A of the Companies Act, 1956 and as such, no amount of principal or interest on account of Fixed Deposits is outstanding, as on the date of Balance Sheet.

STOCK EXCHANGE

The Equity Shares of your Company were listed on two stock exchanges :

- National Stock Exchange of India Limited, Exchange Plaza, Plot no. C/1, G- Block, Bandra-Kurla Complex, Bandra (East), Mumbai 400 051.

- Bombay Stock Exchange Limited, Phiroze Jeejeeboy Towers, Dalal Street, Mumbai 400 001.

The Annual Listing Fees for the year 2012-13 are paid to both the stock exchanges where the shares of your Company are listed.

AUDITORS

M/s Singhi & Co., Chartered Accountants, Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment.

The Company has received a certificate from the proposed Auditors to the effect that their appointment, if made, would be within the prescribed limits under Section 224 (1B) of the Companies Act, 1956.

With regard to the comments in the Auditor's Report the notes on accounts are self-explanatory and therefore does not call for any further comments.

DIRECTORS

In accordance with the provisions of the Companies Act, 1956 and as per the Articles of Association of the Company Mr. Padam Khaitan and Mr. Pawan Kumar Kedia, Directors, retire by rotation and being eligible, offer themselves for reappointment at the ensuing Annual General Meeting

Mr. Ram Prasad Saraf and Mr. Laxmi Narayan Jhavar resigned from the Board of Directors. Your Directors place on record the appreciation of the valuable services rendered by him to the company during his association with the Company.

Mr. Yudhisthir Lal Madan and Mr. Ram Tawakya Singh have been appointed as Additional Directors of the Company till conclusion of the next Annual General Meeting of the Company.

None of the Directors of the Company are disqualified for being appointed as Directors, as specified in Section 274 (1)(g) of the Companies Act, 1956.

CORPORATE GOVERNANCE

Adoption of Best ethical business practices in the Company within the regulatory framework is the essence of good Corporate Governance. On one hand good Corporate Governance calls for accountability of the persons who are at the helm of affairs of the Company and on the other hand it also brings benefits to all stakeholders of the Company such as investors, customers, employees and the society at large. Your Company continues to believe in such business practices and gives thrust on providing reliable financial information, maintenance of transparency in all its business transactions and ensuring strict compliance of all applicable laws.

The report of Corporate Governance as stipulated under Clause 49 of the Listing Agreement forms part of the Annual Report.

The requisite certificate from the statutory auditors of the Company, confirming the compliance with the conditions of Corporate Governance as stipulated under the aforesaid Clause 49, is attached with the Corporate Governance report.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to Director's Responsibility Statement, it is hereby confirmed that:

i) In the preparation of annual accounts for the year ended 31st March 2012, applicable accounting standards have been followed along with proper explanations relating to material departures;

ii) The Directors have selected such accounting policies and applied them consistently and made judgements 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 2011-2012 and of the profit or loss of the Company for that period;

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

iv) They have prepared the annual accounts for 2011-2012 on a going concern basis.

PARTICULARS OF EMPLOYEES

The information as required in terms of the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended forms part of this Report as "Annexure - B".

TRANSFER OF AMOUNTSTO INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to the provisions of Section 205C of the Companies Act, 1956, unpaid application amount or dividends which remained unpaid or unclaimed for a period of 7 years have been transferred by the Company to the Investor Education and Protection Fund.

CORPORATE SOCIAL RESPONSIBILITY

The responsibility of the Company is to make a positive impact on the communities in which the Company does business through its support of select programs, outreach efforts and initiatives that improve and enhance the quality of life. Our goal is to make things better for the planet, better for people, better for business, better now, better for the future.

Your Company believes in the principle of symbiotic relationship with the local communities, recognizing that business ultimately has a purpose - to serve human needs. Close and continuous interaction with the people and communities in and around the manufacturing divisions has been the key focus while striving to bring around qualitative changes and supporting the underprivileged

The Company has helped to organise various free camps and will ensure that more steps are taken in this regard. APPRECIATION

Your Directors would like to convey their appreciation for all the co-operation and assistance received from the Government Authorities, Financial Institutions, Banks, Customers, Vendors and Stakeholders of the Company during the year under review. Your Directors also express their deep sense of appreciation for the committed services by the executives, staff and workers of the Company. We look forward to receiving the continued patronage of all our business partners to become a better and stronger company.

On behalf of the Board

Place : Kolkata Mahabir Prasad Jalan

Dated : 12th May, 2012 (Chairman)


Mar 31, 2011

The Directors are pleased to present the 29th Annual Report of your Company along with the Audited Accounts for the financial year ended 31st March, 2011.

FINANCIAL HIGHLIGHTS 2010-2011

(Rs. in Lakhs) Particulars Year ended Year ended 31st March,2011 31st March,2010

Sales and Operating Income 44537.75 30706.50

Other Income 108.58 0.09

Profit before Interest, Depreciation & Tax 7040.78 4457.38

Interest and Finance Charges 1611.46 1508.71

Depreciation 2097.89 1313.89

Profit before Tax 3331.43 1634.78

Provision for Taxation:

-Current Tax 924.00 278.00

-MAT Credit Entitlement - (271.00)

-Deferred Tax 194.00 533.60

-Income Tax of earlier years 7.50 4.79

Profit after Tax 2205.93 1089.39

Add: Surplus Brought Forward 5032.45 4185.27

Surplus available 7238.38 5,274.66

Appropriations:

-TransfertoGeneral Reserve 170.00 50.00

-Dividend 328.57 164.29

-Tax on Distributed profits 53.30 27.92

Balance carried to Balance Sheet 6686.51 5,032.45

FINANCIAL AND PERFORMANCE REVIEW

- 43.77% increase in Net Turnover from Rs. 28495.76 Lakhs to Rs. 40968.61 Lakhs.

- 57.98% increase in EBIDTA from Rs. 4457.38 Lakhs to Rs. 7040.78 Lakhs

- 62.72% increase in Cash Profit from Rs. 2936.88 Lakhs to Rs. 4779.45 Lakhs.

- 102.57% increase in Profit after Tax from Rs. 1089.39 Lakhs to Rs. 2205.93 Lakhs.

The year 2010-2011 was a good year for the Industry as there was a huge demand for the vehicles and also there was an increase in production trends during the year as compared to the last year.

The cumulative production of commercial vehicles increased from 567,556 in 2009-10 to 752,735 in 2010-11 registering a growth of 27.45 percent over same period last year.

In 2010-2011, production of passenger vehicles segment, commercial vehicles segment, three wheelers segment and two wheelers segment grew by 26.72 percent, 32.63 percent, 29.13 percent and 27.24 percent respectively.

The overall domestic sales of the commercial vehicles segment registered increase from 5,31,395 vehicles to 6,76,408 vehicles registering a growth of 27.29 percent during 2010-2011 as compared to the same period last year. The Medium & Heavy Commercial Vehicles (M&HCVs) registered growth of 31.78 percent and the Light Commercial Vehicles grew at 22.88 percent.

TRANSFER TO RESERVES

Your Company proposes to transfer Rs. 170.00 Lakhs to General Reserve out of the amount available for appropriation and an amount of Rs. 6686.51 Lakhs is proposed to be carried over to Balance Sheet.

DIVIDEND

In view of the improved performance of your Company, your Directors are pleased to recommend a dividend of Rs.2 per share for the year 2010-11. The total payout on dividend (including tax) will be Rs. 381.87 lakhs during the year under review.

The dividend, if approved, at the forthcoming Annual General Meeting will be paid to those shareholders whose names appear in the Register of Members as on 22nd June, 2011.

SHARE CAPITAL

During the year, out of 29,00,000 warrants issued on preferential basis as per the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009, to M/s Eastern Credit Capital Limited, Promoter group the Company has received Rs. 765.94 Lakhs for conversion of 9,50,000 warrants into equity shares of the Company. The amount paid represents the balance 75% of the issue price for 9,50,000 warrants.

The company in its Board Meeting held on 4th April, 2011 has allotted 9,50,000 equity shares to M/s. Eastern Credit Capital Limited, Promoter group, by conversion of 9,50,000 warrants into equity shares of the Company and accordingly the paid- up capital has increased .

During the year under review, there has been no change in the share capital of the Company.

OPERATIONAL HIGHLIGHTS

Forgings and Machining facility

The Company derives the major share of its revenues from the commercial vehicle segment. Your Company produced 31234.46 tons (including Job Work) during the year under review as compared to 26487.23 tons last year, registering an increase of about 17.92%. During the year, the installed capacity of the forgings section increased by 3,600 tons from 34,100 tons to 37,700 tons. The Company has been able to utilise 89.24% of the production capacity for the year as compared to 77.70% last year.

The Company has increased its billet cutting facilities by importing fully automatic horizontal bandsaw machine from Amada Machine Tools, Japan. The Company further intends to shore up its raw material cutting facilities to facilitate smooth flow of production and reduce its cost of operations.

The Company had augmented its Machining Facilities by procuring CNC Gear Hobbing Machines from Mitsubishi Heavy Industries Limited, Japan and Premier Limited, High performance CNCTuming Centers and CNC Vertical Machining Centers from Doosan, Korea which will help the Company to provide more value added products to OEM and to broad base the spectrum of products supplied to OEMSs. It will also balance the capacity utilisation of the Heat Treatment facilities.

The Company has the state-of-art CNC Machining and Gear Cutting facilities in which it has achieved accuracies of Class 6 as per DIN 3962 in the soft stage and Class 8 as per DIN 3962 in the hard stage in gear manufacturing. During the year the Company has added 50 new products in the Turning section, 22 new products in the Gear section and 12 new products in the HMC/VMC section.

Ring Rolling Line

Ring rolling is a cost-effective and efficient production process for production of ring-shaped components like crown wheels, bearing rings etc. The equipment is fully capable of meeting the requirements of the automobile industry, especially that of commercial vehicles (primarily medium and heavy vehicles).

The Company has produced 16438 tons during the year as compared to 9699.87 tons last year thus registering a growth of about 69.50%. The Company has achieved a capacity utilisation of 68.50% during the year as compared to around 40.40% last year on account of improved export performance of the Company. The improvement in the performance of the ring rolling facilities will help the Company to report better topline and improved margins.

CREDIT RATING

Your Company has the rating of LBBB+ for its fund based facilities and A2+ for its commercial paper/short term debt size of Rs. 60 Crores from lCRA Ltd.

EMPLOYEES STOCK OPTION SCHEME

Pursuant to the approval accorded by the shareholders on 22nd August, 2009, your Company has formulated the Employee Stock Option Scheme, (ESOS) 2009, for the benefit of the permanent employees including Directors, whether wholetime or not but excluding the promoters of the Company. The said scheme is administered by the Remuneration and Compensation Committee of the Board through a Trust. Under the said scheme 4,68,159 stock options were initially granted at an exercise price of Rs. 20/- per share. The stock options granted to eligible employees are, inter-alia, performance linked options and the exercise period would commence from the date of vesting and will expire on completion of 4 years from the date of vesting of options.

In accordance with SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 (hereinafter "SEBI guidelines"), the details in relation to the options granted, vested exercised, lapsed etc. under ESOS, 2009, as on 31 st March, 2011 are given as under:

Description ESOS 2009

Total number of options granted 4,68,159 options

Pricing formula/Exercise price Rs.20/-

Number of options vested Nil

Number of options exercised Nil

Total No. of Shares arising as a result of exercise of option Nil

Options lapsed 64,045

Variation in terms of Option NA

Money realised by exercise of option NA

Total no. of Options in force 404114

Grant to Senior Managerial Personnel No options were granted during the year

Grant to Non-Executive Director under the scheme No options were granted during the year

Employees who were granted 5% or more of the total No options were granted during the year number of options granted during the year

Employees who were granted options equal to exceeding No options were granted during the year 1% of the issued capital of the Company at the time of grant

Diluted Earning Per Share pursuant to issue of shares on NA exercise of option calculated in accordance with AS 20

Difference between the employee compensation cost Fair Value : Rs.104.31 Lakhs computed using the intrinsic value of stock options and Intrinsic Value : Rs. 95.29Lakhs the employee compensation cost that shall have been Difference:Rs. 9.02 Lakhs recognized had the fair value of options, were used

Impact of this difference on profits of the Company The Profits would reduce by Rs. 9.02 Lakhs

Impact of this difference on EPS of the Company The Basis EPS would reduce from Rs. 13.43 to Rs. 13.37 and Diluted EPS would reduce from Rs. 13.06 to Rs. 13.01

Weighted average exercise price NIL

Weighted average fair value of options for options whose NIL exercise price either equals or exceeds or is less than the market price of the share

Description of the method and significant assumptions No options were granted during the year used during the year to estimate the fair value of Options granted during the year

The Company has received a certificate from the Auditors of the Company that the Scheme has been implemented in accordance with the SEBI Guidelines and as per resolution passed at the Annual General Meeting held on 7th August, 2010. The Certificate will be placed at the Annual General Meeting for inspection by members.

MANAGEMENTS DISCUSSION AND ANALYSIS REPORT

Managements Discussion and Analysis Report for the year under review under clause 49 of the Listing Agreement with the Stock Exchange in India is presented in the separate section forming part of the Annual Report.

POLLUTION CONTROL MEASURES

Your Company has installed adequate pollution control equipment in all its units as per the legal requirement.

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

The particulars relating to energy conservation, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is given in "Annexure-A" to this Report.

FIXED DEPOSITS

During the year, Company has not accepted any Fixed Deposit within the meaning of Section 58A of the Companies Act, 1956 and as such, no amount of principal or interest on account of fixed deposits is outstanding, as on the date of Balance Sheet.

STOCK EXCHANGE

The equity shares of your Company were listed on two stock exchanges:

- National Stock Exchange of India Limited, Exchange Plaza, Plot No. C/1, G-Block, Bandra-Kurla Complex, Bandra (East), Mumbai-400 051.

- Bombay Stock Exchange Limited, Phiroze Jeejeeboy Towers, Dalai Street, Mumbai - 400 001.

The annual listing fees for the year 2011 -12 are paid to both the stock exchanges where the shares of your Company are listed.

AUDITORS

M/s Singhi & Co., Chartered Accountants, Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment.

The Company has received a certificate from the proposed Auditors to the effect that their appointment, if made, would be within the prescribed limits under Section 224 (1B) of the Companies Act, 1956.

With regard to the comments in the Auditors Report the notes on accounts are self-explanatory and therefore does not call for any further comments.

GROUP

Pursuant to intimation received from the Promoter(s) and in accordance with Regulation 3(1)(e) of the Securities and Exchange Board of lndia (Substantial Acquisition of Shares and Takeovers) Regulations, 1997("SEBI Regulations") regarding identification of persons constituting "Group" (within the meaning as defined in the Monopolies and Restrictive Trade Practices Act,1969) are disclosed in this Annual Report as separate disclosure.

DIRECTORS

In accordance with the provisions of the Companies Act, 1956 and as per the Articles of Association of the Company Mr. Mahabir Prasad Jalan, Mr. Satish Kumar Mehta and Mr. Surendra Mohan Lakhotia, Directors, retire by rotation and being eligible, offer themselves for re-appointment at the ensuing Annual General Meeting.

During the year Mr. Randhir Khandelwal resigned from the Board of Directors. Your Directors place on record the appreciation of the valuable services rendered by him to the company during his association with the Company.

None of the Directors of the Company are disqualified for being appointed as Directors, as specified in Section 274 (1)(g) of the Companies Act, 1956.

CORPORATE GOVERNANCE

Adoption of best ethical business practices in the Company within the regulatory framework is the essence of good Corporate Governance. On one hand good Corporate Governance calls for accountability of the persons who are at the helm of affairs of the Company and on the other hand it also brings benefits to all stakeholders of the Company such as investors, customers, employees and the society at large. Your Company continues to believe in such business practices and gives thrust on providing reliable financial information, maintenance of transparency in all its business transactions and ensuring strict compliance of all applicable laws.

The report of Corporate Governance as stipulated under Clause 49 of the Listing Agreement forms part of the Annual Report.

The requisite Certificate from the Statutory Auditors of the Company, confirming the compliance with the conditions of Corporate Governance as stipulated under the aforesaid Clause 49, is attached to this Report.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to Directors Responsibility Statement, it is hereby confirmed that:

i) In the preparation of annual accounts for the year ended 31 st March, 2011, applicable accounting standards have been followed along with proper explanations relating to material departures;

ii) The Directors have selected such accounting policies and applied them consistently and made judgements 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 2010-2011 and of the profit or loss of the Company for that period;

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

iv) They have prepared the annual accounts for 2010-2011 on a going concern basis.

PARTICULARS OF EMPLOYEES

The information as required in terms of the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975, forms part of this Report as "Annexure B".

CORPORATE SOCIAL RESPONSIBILITY

The responsibility of the Company is to make a positive impact on the communities in which the Company does business through its support of select programs, outreach efforts and initiatives that improve and enhance the quality of life. Our goal is to make things better for the planet, better for people, better for business, better now, better for the future.

Your Company believes in the principle of symbiotic relationship with the local communities, recognizing that business ultimately has a purpose - to serve human needs. Close and continuous interaction with the people and communities in and around the manufacturing divisions has been the key focus while striving to bring around qualitative changes and supporting the underprivileged

The Company has helped to organise free camps for treatment of diabetes and will ensure that more steps are taken in this regard.

APPRECIATION

Your Directors would like to convey their appreciation for all the co-operation and assistance received from the Government Authorities, Financial Institutions, Banks, Customers, Vendors and Stakeholders of the Company during the year under review. Your Directors also express their deep sense of appreciation for the committed services by the executives, staff and workers of the Company. We look forward to receiving the continued patronage of all our business partners to become a better and stronger company.

On behalf of the Board Mahabir Prasad Jalan (Chairman)

Place : Kolkata Dated : The 12th day of May, 2011

 
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