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Directors Report of The Hi-Tech Gears Ltd.

Mar 31, 2015

Dear Members,

The Directors have great pleasure in presenting the 29th Annual Report of your Company, together with the audited statement of accounts for the financial year ended 31st March, 2015.

Financial Results

The highlights of the financial performance of the Company are as under:-

(Rs. in lacs)

Particulars 2014-2015 2013-14

Sales (net of excise duty) 43,192.84 36,102.05

Other Income 266.46 518.48

Total Income 43,459.30 36,620.53 Profit before Depreciation,

Interest & Taxes (PBDIT) 5,509.05 5,102.41

Depreciation 2,510.86 2,306.09

Profit before Interest & Taxes (PBIT) 2,998.19 2,796.33

Financial Charges 368.63 590.37

Profit before Taxes (PBT) 2,629.56 2,205.96

Provision for Taxes 787.85 613.43

Profit after tax ( PAT) 1,841.71 1,592.53

Balance of profit brought forward 9,863.70 9,030.11

Balance available for appropriation 11,705.42 10,622.64

Dividend 469.20 469.20

Tax on dividend 93.81 79.74

Transfer to General Reserve 100.00 160.00

Balance Surplus in P & L Account 10,309.05 9,863.70

Paid-up Equity Share Capital 1,876.80 1,876.80

Earnings Per Share (EPS) 9.81 8.49

General Information

The FY 2014-15 has witnessed key policy reforms, aimed at aiding growth revival and surmounting the structural constraints in the Indian Economy. The Indian Economy grew at 7.3 % in FY 2014-15. The Economy posted a 7.5 % growth in the January to March quarter of the fiscal, outpacing China's GDP of 7 % in that quarter. Growth rebounded in the three most crucial components of industrial sector i.e. mining, manufacturing and electricity. The latest policy initiative of the Indian Government "Make in India" is a welcome move for the growth of Indian Economy.

Automobile Sector showed growth both in Domestic as well as Export Sales. FY 2014-15 numbers reveal all vehicle categories other than Commercial Vehicles are in positive territory. Riding on the back of a gradual uplift in market sentiments, excise duty cuts continuing through to December 2014 and the opening up of the mining and infrastructure sectors, the Indian automotive industry posted an overall growth of 7.22 % in FY 2014-15, as compared to 3.53 % in the previous fiscal year.

According to International Monetary Fund, the global economy is expected to grow at 3.5% in 2015 and 3.8% in 2016. However, Global recovery will continue to be moderate and uneven. While developed economies are expected to strengthen, aided by lower oil prices and low interest rates, most emerging economies are expected to slow down moderately, due to country specific reasons-with India being an exception. The Indian economy is expected to grow by 7.5% in 2015-16. Growth will benefit from recent policy reforms, a consequent pick-up in investment, and lower oil prices". Demand is expected to grow due to various underlying factors including "Make in India", "Digital India", raising per capita income, growing urbanization etc.

Operations

Growth of your Company has been satisfactory and upto the expectation. During the FY 2014-15, total revenue from operations (net of excise) stood at Rs.431.92 crores as compared to Rs 361.02 crores in FY 2013-14, registering an impressive increase of 19.63%. The profit before tax stood at Rs 26.30 crores as compared to Rs 22.07 crores in previous year. Similarly, the Net profit of the Company also grew by 15.65% i.e. from Rs 15.94 crores to Rs 18.41 crores.

Exports of our country were not much encouraging due to massive fluctuation of the exchange rate, recession in the world economy & the pressure of rising raw material cost. Still, your company's export sales were increased by 12% with export revenue of Rs 94.12 crores in the FY 2014-15 as compared to previous year of Rs 84.04 crores, registering a growth of 12%. This was made possible, because of your Company's continuing efforts to tap new customers and markets.

Your Company expects to benefit over the next period from its good business linkage with OEMs, due to its healthy operating efficiencies. In view of this, the long term prospects of your Company are bright.

Share Capital

The paid up Equity Share Capital as on 31st March 2015 was Rs. 18,76,80,000. During the year under review, the Company has not issued shares or granted stock options or sweat equity.

Dividend

During the year under review, an interim dividend of 10 % i.e. Rs. 1.0 per equity share amounting to Rs. 187.68 lacs was declared and paid, the same is being confirmed at the forthcoming AGM. The Directors have now recommended to the shareholders a final dividend of 15% i.e. Rs. 1.50 per equity share, resulting in a payout of Rs. 281.52 lacs. The total dividend payout stands at Rs 469.20 Lacs (Previous year Rs 469.20 Lacs) & tax on dividend comes to Rs 93.81 Lacs (Previous year 79.74 Lacs). Additionally, an amount of Rs. 1.00 Crore is transferred to General Reserve.

If the dividend on the shares as, recommended by the Board of Directors, is approved by the shareholders in their 29th Annual General Meeting, payment of such dividend will be made to those members whose names appear in the Register of Members as per Book closure dates mentioned in the shareholder's information.

Directors Responsibility Statement

In terms of section 134(3) (c) & 134 (5) of the Companies Act, 2013, and to the best of their knowledge and belief, and according to the information and explanations provided to them, your Directors hereby make the following statements:

(a) that in preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanations relating to material departures, if any,

(b) that such accounting policies have been selected and applied consistently and judgments and estimates made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on March 31, 2015 and of the profit of the Company for the year ended on that date,

(c) that proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for prevention and detection of fraud and other irregularities,

(d) that the annual financial statements have been prepared ongoing concern basis,

(e) that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively, and

(f) that the systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

Details of Subsidiary/Joint Ventures/Associate Companies

The Company has neither any Subsidiary, Joint Venture nor an Associate Company within the meaning of Companies Act, 2013. However, the Company is evaluating various options to tap the business opportunities in North American Free Trade Agreement (NAFTA) region by having an entity.

Directors and KMP's appointment/ reappointment

a. Retire by Rotation

Independent Directors are not liable to retire by rotation. Mr. Pranav Kapuria, Managing Director of the Company, retire by rotation at the ensuing Annual General Meeting and being eligible offer himself for re-appointment.

b. Additional Director

Ms. Malini Sud was appointed as an Independent and

Additional Director of the Company who holds the office till the date of ensuing Annual General Meeting. Her appointment is being confirmed at the ensuing Annual General Meeting subject to your approval.

c. Re-appointment of Managerial Personal

Mr. Pranav Kapuria and Mr. Anuj Kapuria have completed their tenure as the Managing Director and the Whole Time Director respectively. The Board of Directors upon the recommendation of Nomination and Remuneration Committee has re-appointed them for another period of five (5) years, subject to your approval.

d. Key Managerial Personnel's

All Whole Time Directors such as Mr. Deep Kapuria, Executive Chairman, Mr. Pranav Kapuria, Managing Director and Mr. Anuj Kapuria, Executive Director are regarded as KMPs, in addition to Chief Financial Officer (C.F.O.) and Company Secretary (C.S.). Mr. S.K. Khatri is the continuing C.S. of the Company. Mr. Vijay Mathur, Sr. General Manager (Finance) was regularized as C.F.O. He resigned from the post of C.F.O. w.e.f. 30th November, 2014, upon the appointment of Mr. Alok Agarwal as the C.F.O. w.e.f. 1st December, 2014. However, Mr. Vijay Mathur will Continue to work as Sr. General Manager (Finance).

Resolutions for the said appointment/reappointment of Directors pursuant to Section 149 & 152 of the Companies Act, 2013 & Rules made there under & Clause 49 of the Listing Agreement are being included in the notice for the ensuing Annual General Meeting for the approval of shareholders.

There is no other change in the Directors during the FY 2014-15.

Meetings of the Board

Necessary Board Meetings transacted to conduct the operations of the Company. The details are given in the Corporate Governance Report, which forms part of this Annual Report. It is confirmed that the gap between two consecutive meetings was not more than one hundred and twenty days as provided in section 173 of the Act.

Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Committees.

Declaration of Independent Director(s)

The Independent Directors have submitted their declarations of independence, as required pursuant to provisions of section 149(7) of the Act, stating that they meet the criteria of independence as provided in sub-section (6).

Auditors

a) Statutory Auditors

M/s Gupta Vigg & Company, Chartered Accountants, (Firm Registration No. 001393N) Statutory Auditors of the Company hold office until the conclusion of the ensuing Annual General Meeting and are eligible for reappointment. Pursuant to provisions of section 139 of the Act and the Rules made thereunder, the Board upon the recommendation of Audit Committee proposes to reappoint M/s Gupta Vigg & Company, Chartered Accountants as Statutory Auditors of the Company till the conclusion of the next Annual General Meeting. They have furnished a certificate confirming the eligibility under section 141 of the Act and Rules made there under.

The Auditors' Report does not contain any qualification, reservation or adverse remark and do not call for any further explanation/ clarification by the Board of Directors as provided under Section 134 of the Act. With respect to the point no. (VII) (b) in Annexure to Auditors' Report with regard to non deposit of disputed taxes. The Board wishes to inform that the matters are related to non- admission of service tax input by the Excise Department, others such as Entry tax & regular income tax matter for which the Company has preferred appeal to Appellate Authorities. The rest of report by the Statutory Auditors is self explanatory. Please refer to the Notes to Accounts, wherever necessary.

b) Cost Auditors

As per Section 148 and all other applicable provisions of the Companies Act, 2013, read with the Companies (Audit and Auditors) Rules, 2014, the Board of Directors has on the recommendation of the Audit Committee, approved the re-appointment of M/s. Kabra & Associates, Cost Accountants as the Cost Auditors of the Company for the year ending 31 March, 2016. The remuneration proposed to be paid to them requires ratification of the shareholders of the Company. In view of this, your ratification for payment of remuneration to Cost Auditors is being sought at the ensuing AGM. Accordingly, a resolution seeking ratification by members for the remuneration payable to M/s Kabra & Associates is included at Item No. 10 of the Notice convening 29th Annual General Meeting.

c) Secretarial Auditor

Section 204 of the Companies Act, 2013 inter-alia requires every listed company to annex with its Board's report, a Secretarial Audit Report provided by a Company Secretary in Practice, in the prescribed form. The Board of Directors appointed M/s Grover Ahuja & Associates, Practicing Company Secretaries as Secretarial Auditor to conduct Secretarial Audit of the Company and their report is annexed to this Board report (Annexure I). The Secretarial Audit Report does not contain any qualification, reservation or adverse remark and do not call for any further explanation/ clarification by the Board of Directors under the Act.

Internal Control Systems and its Adequacy

The Company has internal control systems commensurate with the size, scale and complexity of its business operations. The scope and functions of Internal Auditors are defined and reviewed by the Audit committee. Internal Auditors present their quarterly report to the Audit Committee, highlighting various observations, system and procedure related lapses and corrective actions being taken to address them.

Extract of Annual Return

As required pursuant to section 92(3) & 134 (3) (a) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of Annual Return in MGT 9 as a part of this Annual Report as Annexure II

The Conservation of Energy, Technology Absorption, Foreign Exchange earnings and outgo.

Details of Energy Conservation, Technology Absorption, Research & Development activities undertaken by the Company and foreign exchange earnings and outgo of the Company and other information in accordance with the provisions of Section 134(3) (m) of the Companies Act, 2013, read with the Companies (Disclosure of Particulars in the Report of Board of Directors), Rules, 1988, are given in Annexure III, to this Report.

Report on Corporate Governance

The Report on Corporate Governance is given separately and forming part of this report and the certificate from the Statutory Auditors confirming compliance with the provisions of Corporate Governance as stipulated in Clause 49 of the listing agreement is also attached to the report.

Management discussion & analysis report

The Management Discussion & Analysis Report is given separately and forming part of this report.

Corporate Social Responsibility

Pursuant to the provisions of Section 135 and other applicable provisions of the Companies Act, 2013 and Rules made there under the brief of the Corporate Social Responsibility is provided in Annexure IV

Particulars of contracts or arrangements with related parties

All transactions entered by the Company with the parties, which may be regarded with related parties, were in the ordinary course of business and on the arm's length basis. Necessary resolution for your approval is being placed at the ensuing Annual General Meeting, for your approval. As provided under section 134(3)(h) of the Act and Rules made there under disclosure of particulars of material transactions with related parties entered into by the Company with related parties in the prescribed format annexed to this report as Annexure V Disclosures on related party transactions are also set out in Note No. 31 to the financial statements. The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company's website at the link: http:// www.hitechgears.com/images/RPT.pdf.

Electronic Clearing Services (ECS)

As per the circular issued by Securities & Exchange Board of India (SEBI), companies should mandatorily use the facility of Electronic Clearing Services (ECS), for distribution of dividends to its members. This facility provides to the members an opportunity to receive dividend amount directly in their bank accounts. For availing this facility, members holding shares in physical form may send their duly filled ECS mandate form to the Company's Registrar and Share Transfer Agent (RTA). Members are holding shares in dematerialized form may kindly note that their bank account details as furnished to their depositories will be taken for the purpose of ECS and the Company.

Postal Ballot

During the financial year 2014-15, no Resolution was required to be passed through postal ballot. Similarly, at the forthcoming Annual General Meeting, there is no item for approval through Postal Ballot is being placed.

Code of Conduct of Insider Trading

The Company has adopted a Code of Conduct to regulate, monitor and report trading by insiders This Code of Conduct is intended to prevent misuse of Unpublished Price Sensitive Information ("UPSI") by Designated persons.

In accordance with such Code of Conduct, the Company closes its trading window for Designated Persons from time to time. The trading window is also closed during and after occurrence of price sensitive events as per the said Code of Conduct.

Code of Conduct

Your Company has adopted a Code of Conduct for its Board Members and Senior Management personnel. The code of conduct has also been posted on the official website of the Company.

The Declaration by the Managing Director of the Company regarding compliance with the Code of Conduct for Board Members and Senior Management is annexed with the Corporate Governance Report.

Reconciliation of Share Capital Audit

M/s Grover Ahuja & Associates, practicing Company Secretary carried out the Secretarial Audit on quarterly basis to reconcile the total issued and listed share capital with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). The Board of Directors confirms that the total issued and paid up capital as on 31st March, 2015 is reconciled with the total number of shares in physical form and the total number of dematerialized shares held with NSDL and CDSL. The Reconciliation of Share Capital Audit Certificate is being submitted every quarter to the Stock Exchanges and is also placed before the Board Meeting.

Listing of Shares

With a view to provide easy liquidity in the shares of the Company, the equity shares of your Company are presently listed on the premier stock exchanges viz., the National Stock Exchange of India Limited (NSE) and the Bombay Stock Exchange India Limited (BSE) Mumbai. Pursuant to Clause 38 of the Listing Agreement, the annual listing fees for the year 2015-2016 has been paid within the prescribed time period.

Fixed Deposits

During the year under review your Company neither invited nor accepted any deposit within the meaning of Section 73 of the Companies Act, 2013, and rules made there under.

Dematerialization of the equity shares

99.28 % of the total equity shares of the Company are held in dematerialized form with the participants of National Securities Depository Limited (NSDL) and Central Depository Securities (India) Limited as on the date of this report.

Keeping in view the benefits of dematerialization, your directors urge the shareholders holding shares in physical form to get their shares dematerialized.

Change of Name

The Board of Directors propose to change the name of the Company by prefixing "The" before the existing name of the Company, making it "The Hi-Tech Gears Limited". Registrar of Companies, Jaipur have conveyed its name availability approval by vide its letter dated 7th August, 2015. A Special Resolution in this respect is being moved for your approval at the ensuing 29th Annual General Meeting. After your approval necessary formalities will be completed, for Change of name.

Remuneration Policy

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report.

Audit Committee

Company has duly constituted Audit Committee, which meets on regular intervals for the business required to be transacted thereat. The recommendations made by such committee are accepted by the Board.

As per Companies Act, 2013, the Company has reconstituted and revised the roles, responsibilities & powers of the Audit Committee. A synopsis is described in the Corporate Governance Report.

Vigil Mechanism Policy

The Company has a vigil mechanism policy to deal with any instance of fraud and mismanagement. The employees of the Company are free to report violations of any laws, rules, regulations and concerns about unethical conduct to the Audit Committee under this policy. The policy ensures that strict confidentiality is maintained whilst dealing with concerns and also that no discrimination with any person for a genuinely raised concern. The policy may be accessed on the Company's website at the link: http://www.hitechgears.com/ images/Vigil_Mechanism_Policy.pdf

Obligation of Company under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 Company has adopted a policy for prevention of Sexual Harassment of Women at workplace and has set up Committee for implementation of said policy. During the year Company has not received any complaint of harassment.

Particulars of Loans given, Investments made, Guarantees given and Securities provided

The company has not given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013.

The details of the investments made by company are given in the notes to the financial statements.

Material changes and Commitments

There are no material changes and commitments affecting the financial position of the Company which have occurred between the end of the Financial Year to which the financial statements relate and the date of the report.

Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future

There is no significant and/or material order passed by the regulators or courts or tribunals impacting the going concern status of the Company.

Particulars of Employees

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in Annexure VI

Risk Assessment and Mitigation Process

Company has a risk assessment policy which is periodically reviewed by the Audit Committee and Board of Directors in their meeting and it takes the appropriate measures.

Business Responsibility Reporting

As per Clause 55 of the Listing Agreement with the Stock Exchanges Business Responsibility Reporting is not applicable.

Personnel

The Board of Directors place on record their appreciation of the untiring efforts of the employees of the organization at every level. The efforts to create a family like atmosphere continued throughout the year. Like the many years gone-by, this year also witnessed increased cohesion among all levels of employees, which is evident from the performance of the Company. Training and Development of employees provided further impetus and have contributed towards the all round improved performance of your company. The Company encourages by rewarding & recognizing employees for their long term commitment as & when the opportunity arise.

Trade Relations

The Board of Directors place on record their appreciation for the co-operation and valuable support extended by the customers, the suppliers and all other persons directly or indirectly associated with the Company. Your Company regards them as partners and shares with them a common vision of growth in the future.

Acknowledgement

Your directors place on record their sincere appreciation for the assistance, cooperation and valuable support provided to the Company by Customers, Vendors, Banks & Financial Institutions and hope to continue to receive the same in future. Your Directors also record their appreciation for the commitment and dedication of the employees of the Company at all levels.

The Board of Directors also place on record their gratitude to the shareholders of the Company for their continued support to and confidence in the management of the Company.

By Order of the Board

For Hi - Tech Gears Limited



Sd/-

Place:New Delhi Deep Kapuria

Dated:11/08/2015 Chairman


Mar 31, 2014

Dear Members,

The Directors have great pleasure in presenting the 28th Annual Report of your Company, together with the audited statement of accounts for the financial year ended 31st March, 2014.

Financial Results

The highlights of the financial performance of the Company are as under:-

(Rs. in lacs) Particulars 2013-2014 2012-2013

Sales (net of excise duty) 36102.05 37337.83

Other Income 518.48 200.14

Total Income 36620.53 37537.98

Profit before Depreciation, 5102.41 5441.63

Interest & Taxes (PBDIT)

Depreciation 2306.09 2315.87

Profit before Interest & Taxes 2796.32 3125.76 (PBIT)

Financial Charges 590.36 761.81

Profit before Taxes (PBT) 2205.96 2363.95

Provision for Taxes 613.43 742.60

Profit after tax (PAT) 1592.53 1621.35

Balance of profit brought 9030.11 8186.25 forward

Balance available for 10622.64 9807.60 appropriation

Dividend 469.20 469.20

Tax on dividend 79.74 78.29

Transfer to General Reserve 160.00 180.00

Balance Surplus in P & L 9863.70 9030.11 Account

Paid-up Equity Share Capital 1876.80 1876.80

Earnings Per Share (EPS ) 8.49 8.64

General Information

In India GDP Growth rate stood at 4.7% in 2013-14 compare to 4.5% in previous year. Sluggish gains in agricultural and manufacturing output, lower demand in all sectors, high inflation and high interest rates were key restraining factors. Other factors responsible for the lower growth include the slowing global economy, delay in implementation of projects, and the policy logjam leading to a negative business sentiment.

Depreciation of Indian Currency to the extent of Rs. 69/ $ added more stinkers, before stabilizing Rs. 60.50/$. Except two-wheelers, which has major chunk of automatic scooters, performance of Indian Auto- Industry was not upto the mark. As we know the Automobile and Auto Component Sector go hand in hand, thus the auto-component Sector also faced negative growth in FY 2013-14 by registering negative growth of 2 % in FY 2013-14.

Some signs of recovery was visible in the second half of the year. Global Economy is expected to recover moderately, particularly on account of better performance of some advanced economies. At domestic front narrowing CAD, new stable government & moderation in inflation would ease the monetary policy stance & may revive the confidence of investors. The economy can look forward to better growth prospective in 2014-15 & beyond. Economic survey expects a GDP growth of 5.4 % to 5.9% in 2014-15 & if the situation improve, it could push up to 7-8% in coming years.

Operations

Despite, the adverse & discouraging factors, your Company could level the turnover. The revenues of the Company (net of excise duty) stood at Rs 361.02 crores in 2013-14 as compared to Rs 373.38 crores in 2012-13. The net profit (after tax) of the Company has marginally decreased from Rs 16.22 crores to Rs 15.93 crores, as compared to the previous year. Surplus available in P& L account stood at Rs 98.64 Crores, compared to Rs 90.30 crores in previous year.

Even though, exports suffered due to volatility in the exchange rate & the pressure of rising raw material cost, but the overall export remained satisfactory. The Export sales of the Company were higher in FY 2013-14 as compared to the previous year. Your Company recorded a total export turnover of Rs 83.34 crores as compared to export sales of Rs 60.00 crores in the previous year. Thus an impressive increase of 38.90 % was registered.

The long term prospects are however still bright & the demand will grow due to various underlying factors including India''s rising per capita income, increasing rural demand, growing urbanization, swelling replacement demand etc.

Existing customers have assured to provide the new sales target. Thus the company will have in positive directions to increase the sales & profitability of the Company.

Dividend

Considering almost the same performance of the Company, similar dividend policy was approved by your Board, an interim dividend of 10 % i.e. Rs. 1.0 per equity share amounting to Rs. 187.68 lacs was declared and paid, the same is being confirmed at the forthcoming AGM. The Directors have now recommended to the shareholders a final dividend of 15% i.e. Rs. 1.50 per equity share, resulting in a payout of Rs. 281.52 lacs. The total dividend payout stands at Rs 469.20 Lacs (Previous year Rs 469.20 Lacs) & tax on dividend comes to Rs 79.74 Lacs (Previous year 78.29 Lacs).

If the dividend on the shares as, recommended by the Board of Directors, is approved by the shareholders in their 28th Annual General Meeting, payment of such dividend will be made to those members whose names appear in the Register of Members as per Book closure dates mentioned in the shareholder''s information.

In addition to above, the Board proposes to transfer an amount of Rs 1.60 crore to General Reserve in compliance to the requirements of Section 205(2A) of the Companies Act, 1956.

Electronic Clearing Services (ECS)

As per the circular issued by Securities & Exchange Board of India (SEBI), companies should mandatorily use the facility of Electronic Clearing Services (ECS), for distribution of dividends to its members. This facility provides to the members an opportunity to receive dividend amount directly in their bank accounts. For availing this facility, members holding shares in physical form may send their duly filled ECS mandate form to the Company''s Registrar and Share Transfer Agent (RTA). Members holding shares in dematerialized form may kindly note that their bank account details as furnished to their depositories will be taken for the purpose of ECS and the Company. Shareholders who wish to change their bank account details are therefore requested to advise their depository''s participants about such changes.

Those shareholders who have not yet opted for the ECS facility are once again requested to avail the benefits of ECS.

Postal Ballot

During the financial year 2013-14, no Special Resolution was required to be passed through postal ballot. At the forthcoming Annual General Meeting, there is no item for approval through Postal Ballot.

Code for Prevention of Insider Trading Practices

In compliance with the SEBI (Prohibition of Insider Trading) Regulations, 1992, your Company has adopted a Code of Conduct for Prevention of Insider Trading Practices for its Directors and designated employees. The code lays down guidelines, which include procedures to be followed, and disclosures to be made while dealing in the shares of the Company.

Trading Window

In accordance with the Code of Conduct for prevention of insider trading, the Company closes its trading window for designated employees and directors from time to time. As per the policy, the trading window closes for a period of 7 (seven) days, prior to the date of the Board Meeting and opens 24 hours after the conclusion of Board Meeting in which the respective quarterly/half yearly/ yearly financial results are approved. The trading window is also closed during and after occurrence of price sensitive events as per the Code of Conduct for prevention of insider trading.

Code of Conduct

Your Company has adopted a Code of Conduct for its Board Members and Senior Management personnel. The code of conduct has also been posted on the official website of the Company.

The Declaration by the Managing Director of the Company regarding compliance with the Code of Conduct for Board Members and Senior Management is annexed with the Corporate Governance report.

Reconciliation of Share Capital Audit

M/s Grover Ahuja & Associates, practicing Company Secretary carried out the Secretarial Audit on quarterly basis to reconcile the total issued and listed share capital with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). The Board of Directors confirms that the total issued and paid up capital as on 31st March, 2014 is reconciled with the total number of shares in physical form and the total number of dematerialized shares held with NSDL and CDSL. The Reconciliation of Share Capital Audit Certificate is being submitted every quarter to the Stock Exchanges and is also placed before the Board Meeting.

Subsidiary Company

The Company has no subsidiary during the financial year 2013-14.

Listing of Shares

With a view to provide easy liquidity in the shares of the Company, the equity shares of your Company are presently listed on the premier stock exchanges viz., the National Stock Exchange of India Limited (NSE) and the Bombay Stock Exchange Limited (BSE) Mumbai. Pursuant to Clause 38 of the Listing Agreement, the annual listing fees for the year 2014-2015 has been paid within the prescribed time period. It is further confirmed that custodian fee to NSDL/CDSL for the year 2014-15 has also been paid.

Dematerialization of the equity shares

99.02 % of the total equity shares of the Company are held in dematerialized form with the participants of National Securities Depository Limited (NSDL) and Central Depository Securities (India) Limited as on the date of this report.

Keeping in view the benefits of dematerialization, your directors urge the shareholders holding shares in physical form to get their shares dematerialized.

Directors

Mr. Ramesh Chandra Jain, Director of the Company, retire by rotation at the ensuing Annual General Meeting and being eligible offer himself for re-appointment. Mr. Vinit Taneja, Mr. P.C. Mathew, Mr. Prosad Dasgupta, Mr. K.C. Verma, Mr. Sandeep Dinodia & Mr. Anil Kumar Khanna are the Non Executive & Independent Directors of the Company are being appointed as Independent Directors in terms of section 149 & 152 of the companies Act, 2013 for 5 (five) consecutive years from the date of the 28th Annual General Meeting. Independent Directors will not be liable to retire by rotation as per the Companies Act, 2013.

Mr. Deep Kapuria, Executive Chairman & Whole Time Director, Mr. Pranav Kapuria, Managing Director & Mr. Anuj Kapuria, Whole Time Director are the Executive Directors of the Company.

A brief profile of the directors proposed to be appointed/re-appointed pursuant to Section 152 & 149 of the Companies Act, 2013 & Rules made thereunder & Clause 49 VI (A) of the Listing Agreement is being annexed to the Notice convening the 28th Annual General Meeting.

Auditors

M/s Gupta Vigg & Company, Chartered Accountants, Statutory Auditors of the Company retire at the conclusion of the Annual General Meeting of the Company and being eligible, have offered themselves for re-appointment. The Company has received an eligibility certificate from the auditors under Section 139 & 141 & other applicable Provisions of the Companies Act, 2013. The Board of Directors recommends their re- appointment for another term of 1 (one) year.

With respect to the point no. 9 (b) in Annexure to Auditors'' Report with regard to non deposit of disputed taxes, the Board wishes to inform that the matters are related to non-admission of service tax input by the Excise Department, others such as Entry tax & regular income tax matter for which the Company has preferred appeal to Appellate Authorities. The rest of report by the Statutory Auditors is self explanatory. Please refer to the Notes to Accounts, wherever necessary.

Directors Responsibility Statement

In compliance of Section 217(2AA) of the Companies Act, 1956, as amended by the Companies (Amendment) Act, 2000, the Board of Directors of your Company confirms:

a. That the applicable accounting standards have been followed in the preparation of final accounts for the year ended March 31, 2014 and that there are no material departures.

b. That such accounting policies have been selected and applied consistently and such judgments and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2014 and of the profit of the Company for the year ended on that date.

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

d. That the annual accounts for the year ended March 31, 2014 have been prepared on a going concern basis.

Audit Committee

Company has duly constituted Audit Committee, which meets on regular intervals for the business required to be transacted there at. The recommendations made by such committee are accepted by the Board.

As per Companies Act, 2013, the Company has reconstituted and revised the roles, responsibilities & powers of the Audit Committee. A synopsis is described in the Corporate Governance report as per Annexure III attached.

Particulars of Employees

Information in accordance with the provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended, is given in Annexure-I, to this report.

The Conservation of Energy, Technology Absorption, Foreign Exchange earnings and outgo.

Your Company continuously strives for Safety, Environment Management and conservation of resources like fuel, water, gas and power. Therefore, emphasis is being laid on employing sophisticated techniques which result in conservation of natural resources like energy, fuel etc.

Your company gives high priority to safety which envisages a zero accident policy as the only acceptable standard of performance.

Details of Energy Conservation, Technology Absorption, Research & Development activities undertaken by the Company and foreign exchange earnings and outgo of the Company and other information in accordance with the provisions of 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, are given in Annexure-II, to this Report.

Corporate Governance

The Report on Corporate Governance is attached herewith in Annexure-III, and the certificate from the Statutory Auditors confirming compliance with the provisions of Corporate Governance as stipulated in Clause 49 of the listing agreement is also attached to the report.

Management discussion & analysis report

The Management Discussion & Analysis Report is given separately and forming part of this report.

Trade Relations

The Board of Directors place on record their appreciation for the co-operation and valuable support extended by the customers, the suppliers and all other persons directly or indirectly associated with the Company. Your Company regards them as partners and shares with them a common vision of growth in the future.

Public Deposits

During the year under review your Company neither invited nor accepted any deposit within the meaning of Section 58-A of the Companies Act, 1956, and rules made thereunder.

Personnel

The Board of Directors place on record their appreciation of the untiring efforts of the employees of the organisation at every level. The efforts to create a family like atmosphere continued throughout the year. Like the many years gone-by, this year also witnessed increased cohesion among all levels of employees, which is evident from the performance of the Company. Training and Development of employees provided further impetus and have contributed towards the all round improved performance of your company. The Company encourages by rewarding & recognising employees for their long term commitment as & when the opportunity arise.

Corporate Social Responsibility Committee

Pursuant to the provisions of the Companies Act, 2013, the Company constituted CSR Committee in the commencement of FY 2013-14. A brief of the committee is provided in Corporate Governance as per Annexure III attached.

Acknowledgement

Your directors place on record their sincere appreciation for the assistance, cooperation and valuable support provided to the Company by Customers, Vendors, Banks & Financial Institutions and hope to continue to receive the same in future. Your Directors also record their appreciation for the commitment and dedication of the employees of the Company at all levels.

The Board of Directors also place on record their gratitude to the shareholders of the Company for their continued support to and confidence in the management of the Company.

By Order of the Board For Hi - Tech Gears Limited

Sd/- Place: New Delhi Deep Kapuria Dated: 07/08/2014 Chairman


Mar 31, 2012

Dear Members,

The Directors have great pleasure in presenting the 26th Annual Report of your Company, together with the audited statement of accounts for the financial year ended 31st March, 2012.

Financial Results

The highlights of the financial performance of the Company are as under:-

(Rs.in lacs)

Particulars 2011-2012 2010-2011

Sales (net of excise duty) 49748.43 42493.15

Other Income 349.79 246.38

Total Income 50098.22 42739.53

Profit before Depreciation, Interest & Taxes (PBDIT) 8974.87 7641.06

Depreciation 1982.28 1618.71

Profit before Interest & Taxes (PBIT) 6992.59 6022.35

Financial Charges 741.40 756.16

Earning before Taxes (PBT) 6251.19 5266.19

Provision for Taxes 2039.78 1762.72

Profit after tax (PAT) 4211.41 3503.47

Balance of profit brought forward 5456.41 3276.53

Balance available for appropriation 9667.82 6780.00

Dividend 844.56 750.72

Tax on dividend 137.01 122.87

Transfer to General Reserve 450.00 400.00

Balance Surplus in P & L Account 8186.25 5456.41

Paid-up Equity Share Capital 1876.80 1876.80

Earnings Per Share (EPS) 22.44 18.67

Operations

The year gone by proved to be an anothersuccessful year forthe performance of your company and remained good for exports. The revenues of the Company (net of excise duty) increased to Rs. 49748.43 lacs in 2011-12 as compared to Rs. 42493.15 lacs in 2010-11, thus registering an impressive increase of 17.07 %.

The Indian automobile industry grew by almost 14% as compared to 27% in the previous year due to the low demand in domestic market. Demand for cars including low end hetchbacks fell for the first time in three years. Sales in commercial vehicles were moderate & in three wheeler segment, negative growth was noted. Two wheeler remain the star performer with a share of 77% in total automobile sale. The growth of the Company is better compare to market conditions. The Net Profit (aftertax) of the Company has increased from Rs. 3503.47 lacs to Rs. 4211.41 lacs, recording an increase of 20.21% as compared to the previous year.

The year under review saw an increase in demand forthe company's products in both the domestic and exports markets.

Exports

The Export Sales were the most encouraging during the year under review. The automobile Industry was able to post almost 25% increase by exporting 2.91 million units. Your Company also recorded a total export turnover of Rs. 127.45 crores as compared to export sales of Rs. 90.02 crores in the previous year, thus registering an increase of 41 %. The higher exports were made possible because your company penetrated the European and Latin American markets also in addition to US market. The Customers in those countries recognized & accepted the quality of products offered by the Company to their satisfaction.

Dividend

During the year, an interim dividend of 20 % i.e. Rs. 2.0 per equity share amounting to Rs. 375.36 lacs was declared and paid the same is being confirmed at the forthcoming AGM. The Directors have now recommend to the shareholders a final dividend of 25% i.e. Rs. 2.50 per equity share subject to the approval of the shareholders at the ensuing Annual General Meeting resulting in a payout of Rs. 469.20 lacs. The total dividend payout stands at Rs 844.56 Lacs (Previous year Rs 750.72 Lacs) & tax on dividend comes to Rs 137.01 Lacs (Previous year 122.87 Lacs)

If the dividend on the shares as, recommended by the Board of Directors, is approved by the shareholders in their 26th Annual General Meeting, payment of such dividend will be made to those members whose names appear in the Register of Members as perthe book closure dates mention in the shareholders information.

In addition to above the Board proposes to transfer an amount of Rs 45,000,000/- to General Reserve in compliance to the requirements of Section 205(2A) of the Companies Act, 1956.

Electronic Clearing Services (ECS)

As per the circular issued by Securities & Exchange Board of India (SEBI), companies should mandatorily use the facility of Electronic Clearing Services (ECS), for distribution of dividends to its members. This facility provides to the members an opportunity to receive dividend amount directly in their bank accounts. For availing this facility, members holding shares in physical form may send theirduly filled ECS mandate form to the Company's Registrar and Share Transfer Agent (RTA). Members holding shares in dematerialized form may kindly note that their bank account details as furnished to their depositories will be taken forthe purpose of ECS and the Company. Shareholders who wish to change their bank account details are therefore requested to advise their depository's participants about such changes.

Those shareholders who have not yet opted forthe ECS facility are once again requested to avail the benefits of ECS.

Postal Ballot

During the financial year 2011 -12, no Special Resolution was required to be passed through postal ballot. At the forthcoming Annual General Meeting, there is no item for approval through Postal Ballot.

Code for Prevention of Insider Trading Practices

In compliance with the SEBI (Prohibition of Insider Trading) Regulations, 1992, your Company has adopted a Code of Conduct for Prevention of Insider Trading Practices for its Directors and designated employees. The code lays down guidelines, which include procedures to be followed, and disclosures to be made while dealing in the shares of the Company.

Trading Window

In accordance with the Code of Conduct for prevention of insider trading, the Company closes its trading window fordesignated employees and directors from time to time. As per the policy, the trading window closes for a period of 7 (seven) days, priorto the date of the Board Meeting and opens 24 hours afterthe conclusion of Board Meeting in which the respective quarterly/half yearly/yearly financial results are approved. The trading window is also closed during and after occurrence of price sensitive events as per the Code of Conduct for prevention of insider trading.

Code of Conduct

Your Company has adopted a Code of Conduct for its Board Members and Senior Management personnel. The code of conduct has also been posted on the official website of the Company. A copy of the code of conduct has been circulated to all the directors and Senior Management.

The Declaration by the Managing Director of the Company regarding compliance with the Code of Conduct for Board Members and Senior Management is annexed with the Corporate Governance report.

Secretarial Audit

M/s Grover Ahuja & Associates, practicing Company Secretary carried out the Secretarial Audit on quarterly basis to reconcile the total issued and listed share capital with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). The

Board of Directors confirms that the total issued and paid up capital as on 31st March, 2012 is reconciled with the total number of shares in physical form and the total number of dematerialized shares held with NSDL and CDSL. The Secretarial audit report is being submitted every quarterto the Stock Exchanges and is also placed before the Board Meeting.

Cost Compliance Certificate

As per notification no. GS.R. 429(E) dated 3rd June, 2011, Ministry of Corporate Affairs, has mandated forthe Cost Compliance Certificates to be compulsorily obtained from Cost Accountants by the certain Companies. The Company being eligible as per the criteria mentioned in the said notification obtained a Cost Compliance Certificate for the year 2011-12 from M/s Kabra & Associates, Cost Accountants which was duly approved in the Board Meeting held on 26th May, 2012.

Subsidiary Company

The Company had no subsidiary during the financial year 2011-12.

Listing of Shares

With a view to provide easy liquidity in the shares of the Company, the equity shares of your Company are presently listed on the premier stock exchanges viz., the National Stock Exchange (NSE) and the Bombay Stock Exchange Limited (BSE) Mumbai. Pursuant to Clause 38 of the Listing Agreement, the annual listing fees for the year 2012-2013 has been paid within the prescribed time period. It is further confirmed that custodian fee to NSDL/CDSL forthe year 2012-13 has also been paid.

Dematerialization of the equity shares

98.88 % of the total equity shares of the Company are held in dematerialized form with the participants of National Securities Depository Limited (NSDL) and Central Depository Securities (India) Limited as on the date of this report.

Keeping in view the benefits of dematerialization, your directors urge the shareholders holding shares in physical form to get their shares dematerialized.

Directors

Recently the Board of Directors of your company has been reconstituted with the induction of two new Additional Directors, Mr. Krishna Chandra Verma w.e.f November 12, 2011 and Mr. Prasad Dasgupta w.e.f February 14, 2012. The appointment of Mr. Krishna Chandra Verma and Mr. Prasad Dasgupta are up to the forthcoming Annual General Meeting your Board commends to the shareholders, their appointment as a Director of the Company.

Mr. Vinit Taneja and Mr. P.C. Mathew, Directors of the Company, retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re- appointment. Mr. Deep Kapuria, Mr. Pranav Kapuria, Mr. Sandeep Dinodia, Mr. Anil Kumar Khanna, and Mr. Anuj Kapuria, Mr. Ramesh Chandra Jain are the other continuing Directors

A brief profile of the directors proposed to be appointed or re-appointed and the information pursuant to Clause 49 VI (A) of the Listing Agreement is being annexed to the Notice convening the 26th Annual General Meeting.

Auditors

M/s Gupta Vigg & Company, Chartered Accountants, Statutory Auditors of the Company retire at the conclusion of the Annual General Meeting of the Company and being eligible, have offered themselves for re-appointment. The Company has received an eligibility certificate from the auditors under Section 224 (1B) of the Companies Act, 1956. The Board of Directors recommends their re- appointment.

With respect to the point no. ix (b) in annexure to the Auditors' Report with regard to non deposit of disputed taxes, the Board to inform that company has preferred appeal to Assessing Authorities. The rest of report by the Statutory Auditors is self explanatory. Please refer to the Notes to Accounts wherever necessary.

Directors Responsibility Statement

In compliance of Section 217(2AA) of the Companies Act, 1956, as amended by the Companies (Amendment) Act, 2000, the Board of Directors of your Company confirms:

a. That the applicable accounting standards have been followed in the preparation of final accounts for the year ended March 31,2012 and that there are no material departures.

b. That such accounting policies have been selected and applied consistently and such judgments and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2012 and of the profit of the Company for the year ended on that date.

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

d. That the annual accounts for the year ended March 31, 2012 have been prepared on a going concern basis.

Audit Committee

Company has duly constituted Audit Committee, which meets on regular intervals forthe business required to be transacted thereat. The recommendation made by such committee are accepted by the Board.

Particulars of Employees

Information in accordance with the provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended, is given inAnnexure-l, to this report.

The Conservation of Energy, Technology Absorption, Foreign Exchange earnings and outgo.

Your Company continuously strives for Safety, Environment Management and conservation of resources like fuel, water, gas and power. Therefore, emphasis is being laid on employing sophisticated techniques which result in conservation of natural resources like energy, fuel etc.

Your company gives high priority to safety which envisages a zero accident policy as the only acceptable standard of performance.

Details of Energy Conservation, Technology Absorption, Research & Development activities undertaken by the Company and foreign exchange earnings and outgo of the Company and other information in accordance with the provisions of Section 217(1) (e) ofthe Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors), Rules, 1988, are given in Annexure-ll, to this Report.

Corporate Governance

The Report on Corporate Governance is attached herewith in Annexure-lll, and the certificate from the Statutory Auditors confirming compliance with the provisions of Corporate Governance as stipulated in Clause 49 ofthe listing agreement is also attached to the report.

Management discussion & analysis report

The Management Discussion & Analysis Report is given separately, forming part of this report.

Trade Relations

The Board of Directors place on record their appreciation forthe co-operation and valuable support extended by the customers, the suppliers and all other persons directly or indirectly associated with the Company. Your Company regards them as partners and shares with them a common vision of growth in the future.

Public Deposits

During the year under review your Company neither invited nor accepted any deposit within the meaning of Section 58-A ofthe Companies Act, 1956, and rules made there under.

Personnel

The Board of Directors place on record their appreciation of the untiring efforts of the employees of the organisation at every level. The efforts to create a family like atmosphere continued throughout the year. Like the many years gone-by, this year also witnessed increased cohesion among all levels of employees, which is evident from the performance of the Company. Training and Development of employees provided further impetus and have contributed towards the all round improved performance of your company. The Company encourages by rewarding & recognising employees fortheir long term commitment as & when the opportunity arise.

Awards and Other Recognitions

Yourdirectors have pleasure and feel privileged in reporting the awards & recognitions received by the Company for the year 2011-2012.The Details are provided in the Management Discussion &Analysis Report.

Acknowledgement

Yourdirectors place on record their sincere appreciation for the assistance, cooperation and valuable support provided to the Company by Customers, Vendors, Banks & Financial Institutions and hope to continue to receive the same in future. Your Directors also record their appreciation for the commitment and dedication of the employees of the Company at all levels.

The Board of Directors also place on record theirgratitude to the shareholders of the Company for their continued support to and confidence in the management of the Company.

By Order of the Board For Hi - Tech Gears Limited

Place: New Delhi Deep Kapuria

Dated: 8th August, 2012 Chairman




Mar 31, 2011

Dear Members,

The Directors present the 25th Annual Report of your Company with great pleasure, together with the audited statement of accounts for the financial year ended 31st March, 2011.

Financial Results

The highlights of the financial performance of the Company are as under:-

(Rs. in lacs)

Particulars 2010-2011 2009-2010

Sales (net of excise duty) 42493.15 32269.86

Other Income 243.23 86.18

Total Income 42736.38 32356.05

Profits before Depreciation, Interest and Taxes (PBDIT) 7647.39 4846.94

Depreciation 1618.71 1260.72

Profits before Interest and Taxes ( PBIT) 6028.68 3586.22

Financial Charges 761.52 887.07

Cash Profit (PBDT) 6885.86 3959.86

Profits before Taxes (PBT) 5267.16 2699.14

Provision for Taxes 1762.97 914.09

Profit after tax (PAT) 3504.19 1785.05

Balance of profit brought forward 3276.53 2238.07

Balance available for appropriation 6780.00 4020.57

Dividend 750.72 422.28

Tax on dividend 122.87 71.76

Transfer to General Reserve 400.00 200.00

Balance Surplus in P & L Account 5456.41 3276.53

Paid-up Equity Share Capital 1876.80 938.40

Earnings Per Share (EPS) 18.67 19.00

Operations

The year gone by proved to be a turnaround year for the performance of your company and very encouraging for exports. The revenues of the Company (net of excise duty) increased to Rs. 42736.38 lacs in 2010-11 as compared to Rs.32356.05 lacs in 2009-10, thus registering an impressive increase of 32.08%. The Net Profit (after tax) of the Company has increased from Rs. 1785.04 lacs to Rs. 3504.19 lacs, recording an increase of 96.31 % as compared to the previous year.

During the year your company allotted bonus shares to the existing shareholders of the Company in the proportion of 1:1 by capitalising Rs.938.40 lacs from the General Reserves, thus raising the paid up share capital of your company to Rs.1876.80 lacs. The earnings per share (EPS) was Rs.18.67 per equity share on the increased share capital for the year under review. In the prior year ( 2009-10 ) it was Rs.19.00 per share on the lower share capital of Rs. 938.40 Lacs.

The year under review saw an increase in demand for the company's products in both the domestic and exports markets.

Exports

During the year under review your Company recorded a total export turnover of Rs. 90.03 crores as compared to export sales of Rs. 48.89 crores in the previous year, thus registering an increase of 84% . The higher exports were made possible because your company penetrated the European and Latin American markets also in addition to US market.

Dividend

During the year, an interim dividend of 15% i.e. Rs. 1.50 per equity share on the increased share capital amounting to Rs. 281.52 lacs was declared and paid. The Directors have now recommend to the shareholders a final dividend of 25% i.e. Rs. 2.50 per equity share subject to the approval of the shareholders at the ensuing Annual General Meeting resulting in a payout of Rs. 469.20 lacs.

If the dividend on the shares as, recommended by the Board of Directors, is approved by the shareholders in their 25th Annual General Meeting, payment of such dividend will be made to those members whose names appear in the Register of Members as on September 27, 2011. In respect of the shares held in electronic form, the dividend will be payable to the beneficial owners of the shares as on the closing hours of business on September 15, 2011, as per the details furnished by the depositories for this purpose.

Credit Rating

The independent credit rating agency, 'Fitch' has upgraded HGL's rating to 'A (ind)', which reflects HGL's consistent revenue growth and an improvement in its profitability in the last four years supported by a decline in HGL's working capital cycle. Your company's net cash conversion cycle therefore improved from 19 days to 3 days.

Electronic Clearing Services (ECS)

As per the circular issued by Securities & Exchange Board of India (SEBI), companies should mandatorily use the facility of Electronic Clearing Services (ECS), for distribution of dividends to its members. This facility provides to the members an opportunity to receive dividend amount directly in their bank accounts. For availing this facility, members holding shares in physical form may send their duly filled ECS mandate form to the Company's Registrar and Share Transfer Agent (RTA). Members holding shares in dematerialized form may kindly note that their bank account details as furnished to their depositories will be taken for the purpose of ECS and the Company. Shareholders who wish to change their bank account details are therefore requested to advise their depositories participants about such changes.

Those shareholders who have not yet opted for the ECS facility are once again requested to avail the benefits of ECS.

Postal Ballot

During the financial year 2010-11, no Special Resolution was required to be passed through postal ballot. At the forthcoming Annual General Meeting, there is no item for approval through Postal Ballot.

Code for Prevention of Insider Trading Practices

In compliance with the SEBI (Prohibition of Insider Trading) Regulations, 1992, your Company has adopted a Code of Conduct for Prevention of Insider Trading Practices for its Directors and designated employees. The code lays down guidelines, which include procedures to be followed, and disclosures to be made while dealing in the shares of the Company.

Trading Window

In accordance with the Code of Conduct for prevention of insider trading, the Company closes its trading window for designated employees and directors from time to time. As per the policy, the trading window closes for a period of 7 (seven) days, prior to the date of the Board Meeting and opens 24 hours after the conclusion of Board Meeting in which the respective quarterly/half yearly/ yearly financial results are approved. The trading window is also closed during and after occurrence of price sensitive events as per the Code of Conduct for prevention of insider trading.

Code of Conduct

Your Company has adopted a Code of Conduct for its Board Members and Senior Management personnel. The code of conduct has also been posted on the official website of the Company. A copy of the code of conduct has been circulated to all the directors and Senior Management.

The Declaration by the Managing Director of the Company regarding compliance with the Code of Conduct for Board Members and Senior Management is annexed with the Corporate Governance report.

Secretarial Audit

M/s Grover Ahuja & Associates, practicing Company Secretary carried out the Secretarial Audit on quarterly basis to reconcile the total issued and listed share capital with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). The Board of Directors confirms that the total issued and paid up capital as on 31st March, 2011 is reconciled with the total number of shares in physical form and the total number of dematerialized shares held with NSDL and CDSL. The Secretarial audit report is being submitted every quarter to the Stock Exchanges and is also placed before the Board Meeting.

Subsidiary Company

The Company had no subsidiary during the financial year 2010-11.

Listing of Shares

With a view to provide easy liquidity in the shares of the Company, the equity shares of your Company are presently listed on the premier stock exchanges viz., the National Stock Exchange (NSE) and the Bombay Stock Exchange Limited (BSE) Mumbai. Pursuant to Clause 38 of the Listing Agreement, the annual listing fees for the year 2011-2012 has been paid within the prescribed time period.

Dematerialization of the equity shares

98.59% of the total equity shares of the Company are held in dematerialized form with the participants of National Securities Depository Limited (NSDL) and Central Depository Securities (India) Limited as on the date of this report.

Keeping in view the benefits of dematerialization, your directors urge the shareholders holding shares in physical form to get their shares dematerialized.

Directors

Recently, the Board of Directors of your company has been reconstituted with the induction of a new Additional Director, Mr. Ramesh Chandra Jain w.e.f August 10, 2011. The appointment of Mr. Jain is upto the forthcoming Annual General Meeting and the Board of Directors commends to the shareholders, his appointment as a Director of the Company.

Mr. Anil Kumar Khanna and Mr. Pranav Kapuria, Directors of the Company, retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. Mr. Deep Kapuria, Mr. Sandeep Dinodia, Mr. Anil Kumar Khanna, Mr. P C Mathews and Mr. Anuj Kapuria are the other continuing Directors

A brief profile of the directors proposed to be appointed or re-appointed and the information pursuant to Clause 49 VI (A) of the Listing Agreement is being annexed to the Notice convening the 25th Annual General Meeting.

Auditors

M/s Gupta Vigg & Company, Chartered Accountants, Statutory Auditors of the Company retire at the conclusion of the Annual General Meeting of the Company and being eligible, have offered themselves for re-appointment. The Company has received an eligibility certificate from the auditors under Section 224 (1B) of the Companies Act, 1956. The Board of Directors recommends their re-appointment.

The report by the Statutory Auditors is self explanatory. Please refer to the Notes to Accounts wherever necessary.

Directors Responsibility Statement

In compliance of Section 217(2AA) of the Companies Act, 1956, as amended by the Companies (Amendment) Act, 2000, the Board of Directors of your Company confirms:

a. That the applicable accounting standards have been followed in the preparation of final accounts for the year ended March 31, 2011 and that there are no material departures.

b. That such accounting policies have been selected and applied consistently and such judgments and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2011 and of the profit of the Company for the year ended on that date.

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

d. That the annual accounts for the year ended March 31, 2011 have been prepared on a going concern basis.

Particulars of Employees

Information in accordance with the provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended, is given in Annexure-I, to this report.

The Conservation of Energy, Technology Absorption, Foreign Exchange earnings and outgo.

Your Company continuously strives for Safety, Environment Management and conservation of resources like fuel, water, gas and power. Therefore, emphasis is being laid on employing sophisticated techniques which result in conservation of natural resources like energy, fuel etc.

Your company gives high priority to safety which envisages a zero accident policy as the only acceptable standard of performance.

Details of Energy Conservation, Technology Absorption, Research & Development activities undertaken by the Company and foreign exchange earnings and outgo of the Company and other information in accordance with the provisions of 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, are given in Annexure-II, to this Report.

Corporate Governance

The Report on Corporate Governance is attached herewith in Annexure-III, and the certificate from the Statutory Auditors confirming compliance with the provisions of Corporate Governance as stipulated in Clause 49 of the listing agreement is also attached to the report.

Management discussion & analysis report

The Management Discussion & Analysis Report is given separately, forming part of this report.

Trade Relations

The Board of Directors place on record their appreciation for the co-operation and valuable support extended by the customers, the suppliers and all other persons directly or indirectly associated with the Company. Your Company regards them as partners and shares with them a common vision of growth in the future.

Public Deposits

During the year under review your Company neither invited nor accepted any deposit within the meaning of Section 58-A of the Companies Act, 1956, and rules made there under.

Personnel

The Board of Directors place on record their appreciation of the untiring efforts of the employees of the organisation at every level. The efforts to create a family like atmosphere continued through out the year. Like the many years gone-by, this year also witnessed increased cohesion among all levels of employees, which is evident from the performance of the Company. Training and Development of employees provided further impetus and have contributed towards the all round improved performance of your company.

Awards and Other Recognitions

Your directors have pleasure and feel privileged in reporting the award received by the Company during 2010-2011.The Details are provided in the Management Discussion & Analysis Report.

Acknowledgement

Your directors place on record their grateful appreciation for the assistance, cooperation and valuable support provided to the Company by Customers, Vendors, Banks & Financial Institutions and hope to continue to receive the same in future. Your Directors also record their appreciation for the commitment and dedication of the the employees of the Company.

The Board of Directors also place on record their gratitude to the shareholders of the Company for their continued support to and confidence in the management of the Company.

By Order of the Board For Hi-Tech Gears Limited

Place: New Delhi Deep Kapuria

Dated: August 10, 2011 Chairman


Mar 31, 2010

With great pleasure your directors presents their 24th Annual Report of your Company together with the audited statement of accounts for the financial year ended on March 31,2010.

Financial Results

The highlights of the financial performance of the Company are as under:-

(Rs. in lacs)

Particulars 2009-2010 2008-09

Gross Sales 34456.55 32,378.14

Other Income 86.18 129.85

Total Income 34542.73 32507.99

Profits before Depreciation, 4846.94 3324.81

Interest and Taxes (PBDIT)

Depreciation 1260.72 1176.51

Profits before Interest and 3586.22 2148.30

Taxes (PBIT)

Financial Charges 887.07 996.77

Cash Profit (PBDT) 3963.34 2364.42

Profits before Taxes (PBT) 2699.14 1187.91

Provision for Taxes 913.01 359.32

Profit after tax (PAT) 1785.05 769.36

Balance of profit brought 2238.07 2018.43

forward

Dividend 422.28 140.76

Tax on dividend 71.76 23.92

Transfer to General Reserve 200.00 200.00

Balance Surplus in 3276.53 2238.07

P&L Account

Earnings Per Share (EPS) 19.00 6.23

Operations

The financial year 2009-2010 has ended on a positive note. Your Company surpassed the previous year turnover and has achieved a gross turnover of Rs. 34456.55 Lac (Previous year 32,378.14 Lac), recording an increase of 6.41%. The Net Profit (After tax) of the Company has increased from Rs. 769.36 Lac to Rs. 1785.04 Lac, recording an increase of 132.02 % as compared to the previous year.

The year under review saw increase in demand of the two wheelers and exports also picked up specially in the last two months of the financial year. The availability of the credit and improvement in the world economy has resulted in rise in the demand of the automobiles world wide.

Exports

During the year under review your Company has shown export of its components, recording a total export turnover of Rs. 4889.20 Lac as compared to Rs. 4881.69 Lac in the previous year.

Dividend

The directors recommend to the shareholders a dividend @ 45% (i.e. Rs. 4.5/- per equity share) for the year 2009-2010. Previous year your Company paid dividend @ 15% (i.e. Rs.1.50/- per equity share).

If the dividend on shares as, recommended by the Board of Directors, is approved by the shareholders in their 24th Annual General Meeting, payment of such dividend will be made to those members whose names appear in the Register of Members as on September 27, 2010 and in respect of the shares held in electronic form, the dividend will be payable to the beneficial owners of the shares as on the closing hours of business on September 16,2010, as per the details furnished by the depositories j for this purpose.

Electronic Clearing Services (ECS)

As per the circular issued by Securities & Exchange Board of India (SEBI), the companies should mandatorily use the facility of Electronic Clearing Services (ECS), for distribution of dividends to its members. This facility provides to the members an option to receive dividend amount directly in their bank accounts. For availing this facility, members holding shares in physical form may send their duly filled ECS mandate form to the Companys Registrar and Share Transfer Agent (RTA). Members holding shares in dematerialized form may send their ECS mandate to the concerned Depository Participants (DP) in the prescribed form.

Those shareholders who have not yet opted for the ECS facility are once again requested to avail the benefits of ECS.

Postal Ballot

During the financial year 2009-10, no Special Resolution was required to be passed through postal ballot. At the forthcoming Annual General Meeting, there is no item for approval through Postal Ballot.

Code for Prevention of Insider Trading Practices

In compliance with the SEBI (Prohibition of Insider Trading) Regulations, 1992, your Company has adopted a Code of Conduct for Prevention of Insider Trading Practices for its Directors and designated employees. The code lays down guidelines, which include proce- dures to be followed, and disclosures to be made while dealing in the shares of the Company.

Trading Window

In accordance with the Code of Conduct for prevention of insider trading, the Company closes its trading window for designated employees and directors from time to time. As per policy, trading window closes for a period of 7 (seven) days, prior to the date of Board Meeting and reopens after passing of 24 hours from the conclusion of Board Meeting in which the respective quarterly/half yearly/ yearly financial results are approved. The trading window is also closed during and after occurrence price sensitive event as per the Code of Conduct for prevention of insider trading.

Code of Conduct

Your Company has adopted a Code of Conduct for its Board Members and Senior Management personnel. The code of conduct has also been posted on the official website of the Company. A copy of the code of conduct has been circulated to all the directors and senior Management.

The Declaration by the Chairman & Managing Director of the Company regarding compliance with the Code of Conduct for Board Members and Senior Management is annexed with the Corporate Governance report.

Secretarial Audit

M/s Grover Ahuja & Associates, practicing Company Secretary carried out Secretarial Audit on quarterly

basis to reconcile the total issued and listed share capital with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). The Board of Directors confirms that the total issued and paid up capital as on 31st March, 2010 is reconciled with the total number of shares in physical form and the total number of dematerialized shares held with NSDL and CDSL. The Secretarial audit report is being submitted every quarter to the Stock Exchanges and is also placed before the Board Meeting.

Subsidiary Company

The Company had no subsidiary during the financial year 2009-10.

Listing of Shares

With a view to provide easy liquidity in the shares of the Company, the equity shares of your Company are presently listed on the premier stock exchanges viz., the National Stock Exchange (NSE) and the Bombay Stock Exchange Limited (BSE) Mumbai. Pursuant to Clause 38 of the Listing Agreement, the annual listing fees for the year 2010-2011 has been paid within the prescribed time period.

Dematerialization of the equity shares

98.47% of the total equity shares of the Company are held in dematerialized form with the participants of National Securities Depository Limited (NSDL) and Central Depository Securities (India) Limited as on March 31,2010.

Keeping in view the benefits of dematerialization, your directors urge the shareholders holding shares in physi- cal form to get their shares dematerialized.

Directors

Mr. Sandeep Dinodia and Mr. Anuj Kapuria, Directors of the Company, retire by rotation at the ensuing Annual ¦General Meeting and being eligible offer themselves for F re-appointment. Your Board of Directors considers that it would be in the interest of the Company to continue to avail the services of the above Director due to their vast knowledge, experience and ability.

Mr. Deep Kapuria was appointed as Chairman & Managing Director of the Company for a period of 5 (five) years w.e.f. 1st January 2007 to 31st December 2011, for which approval was duly accorded by the members in their 21st Annual General Meeting held on 17th September, 2007. Keeping in View the restructuring of the designation among all the working Directors of the Company, your Board of Directors has recom- mended for the change in the present designation of Mr. Deep Kapuria from Chairman & Managing Director to Chairman & Whole Time Director (designated as Executive Chairman) w.e.f. 05th August 2010 to 31st December 2011, in their meeting held on 24 day of July 2010, Subject to the approval of shareholders in the ensuing Annual General Meeting.

On the recommendation on Remuneration Committee, Mr. Pranav Kapuria, Deputy Managing Director of the company has been reappointed by the Board of Direc- tors for a period of five years w.e.f. 1st August 2010 to 31st July 2015 in their meeting held on 15th May 2010 subject to the approval of the shareholders. The Board of Directors has also made change in his designation from Deputy Managing Director to Managing Director from 5th August 2010 till 31st July, 2015, subject to the approval of Shareholders. Further the Board of Direc- tors has also appointed Mr. Anuj Kapuria as Whole Time Director designated as Executive Director w.e.f. 15th May 2010 to 14th May 2015, subject to the approval of share- holders.

Resolutions for the said appointment/reappointment- /restructuring are being included in the notice for the ensuing Annual General Meeting for the approval of shareholders.

Directors Responsibility Statement

In compliance of Section 217(2AA) of the Companies Act, 1956, as amended by the Companies (Amendment) Act, 2000, the Board of Directors of your Company confirms:

(i) That the applicable accounting standards have been followed in the preparation of final accounts for the year ended March 31, 2010 and that there are no mate- rial departures.

(ii) That such accounting policies have been selected and applied consistently and such judgments and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2010 and of the profit of the Company for the year ended on that date.

(iii) That proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and preventing and detecting fraud and other irregularities, and

(iv) That the annual accounts for the year ended March 31, 2010 have been prepared on a going concern basis.

Particulars of the Employees

Information in accordance with the provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended, is given in Annexure-I, to this report.

The Conservation of Energy, Technology Absorp- tion, Foreign Exchange earnings and outgo.

Details of Energy Conservation, Technology Absorp- tion, Research & Development activities undertaken by the Company and foreign exchange earnings and outgo of the Company and other information in accord- ance with the provisions of 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, are given in Annexure-ll, to this Report.

Your Company continuously strives for Safety, Environ- ment Management and conservation of resources like fuel, water, gas and power. Your company believes in vision of safety which envisages zero accident policy as the only acceptable standard of performance. There- fore, emphasis is being laid on employing sophisticated techniques which result in conservation of natural resources like energy, fuel etc.

Corporate Governance

Report on Corporate Governance is attached herewithin Annexure-lll, and the certificate from the Statutory Auditors confirming the compliance of the provisions of Corporate Governance as stipulated in Clause 49 of the listing agreement with the stock exchanges is given in this report.

Management Discussion & Analysis Report

Management Discussion & Analysis Report is given separately, forming part of this report.

Trade Relations

The Board of Directors place on record their apprecia- tion for the co-operation and valuable support extended by the customers, the suppliers and all other I persons directly or indirectly associated with the Company. Your Company regards them as partners and shares with them vision of growth in the future.

Public Deposits

During the year under review your Company neither invited nor accepted any deposit within the meaning of Section 58-A of the Companies Act, 1956, and rules made there under.

Personnel

The Board of Directors place on record its appreciation for the untiring efforts made by the employees of the organisation at every level. The efforts to create a family like atmosphere continued through out the year. Like many years gone-by this year also witnessed increased cohesion among all levels of employees, which is evident from the performance of the Company. Train- ing and Development of employees provided further impetus and have been largely responsible for the all round improved performance.

Awards and Other Recognitions

Your directors have pleasure and feel privileged in reporting the award received by the Company during 2009-2010The Details were given in Annexure-IV.

Auditors

M/s Gupta Vigg & Company, Chartered Accountants, Statutory Auditors of the Company retire at the conclu- sion of the Annual General Meeting of the Company and being eligible, have offered themselves for re-appointment. The Company has received an eligibil- ity certificate from the auditors under Section 224 (IB) of the Companies Act, 1956. The Board of Directors recommends their re-appointment.

Acknowledgement

Your directors place on record their grateful apprecia- tion for the assistance, cooperation and support provided to the Company by Vendors, Customers, Banks & Financial Institutions like Hero Honda Motors Limited, Honda Motorcycle and Scooter Ltd., Honda Siel Cars Ltd., Honda Siel Power Products Ltd.,Tata Cummins Ltd., GETRAG Corporation, GETRAG All Wheel Drive, Robert Bosch, State Bank of India, ICICI Bank Limited, Citi Bank, Standard Chartered Bank, State Bank of Bikaner and Jaipur, Bank of Baroda, DBS Bank, YES Bank for their valued support, and hope to continue to receive the same in future.

The Board of Directors also place on record their gratitude to the shareholders of the Company for their continued support to and confidence in the manage- ment of the Company.

By Order of the Board of

Hi -Tech Gears Limited

Deep Kapuria

Chairman & Managing Director

Place : New Delhi

Dated : July 24, 2010

 
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