Directors Report of ZF Commercial Vehicle Control Systems India Ltd.

Mar 31, 2023

The Directors have pleasure in presenting the 19^th Annual Report of ZF Commercial Vehicle Control Systems India Limited (‘the Company’) along with the audited financial statements for the financial year ended 31^st March 2023.

1. FINANCIAL HIGHLIGHTS

? in lakhs
	Standalone		Consolidated
Particulars	Year ended	Year ended	Year ended	Year ended
	31.03.2023	31.03.2022	31.03.2023**	31.03.2022*
Revenue from Operations	344,458.60	254,335.39	344,424.53	254,335.39
Other Income	6,701.31	3,752.92	6,698.21	3,752.92
Total Income	351,159.91	258,088.31	351,122.74	258,088.31
Profit before interest depreciation and tax	53,731.74	29,007.64	53,733.88	29,007.64
Finance Costs	566.54	190.18	566.54	190.18
Depreciation	10,476.38	9,243.17	10,477.68	9,243.17
Profit before tax	42,688.82	19,574.29	42,689.66	19,574.29
Provision for taxation (including deferred tax and tax relating to earlier years)	10,921.48	5,366.85	10,922.48	5,366.85
Profit after tax	31,767.34	14,207.44	31,767.18	14,207.44
Other Comprehensive Income / (Loss) for the year net of tax	12.69	(353.58)	12.69	(353.58)
Total Comprehensive Income for the year Net
of Tax	31,780.03	13,853.86	31,779.87	13,853.86

* Consolidation of financials for FY 2021-22 was considered for 3 months since incorporation of Wholly owned subsidiary Company (ZF CV Control Systems Manufacturing India Private Limited) w.e.f. 5^th January 2022.

** Consolidation of financials for FY 2022-23 is considered for 15 months, as first financial year is ending on 31^st March 2023 for the Wholly owned subsidiary Company (ZF CV Control Systems Manufacturing India Private Limited).

2. DIVIDEND

The Board of Directors has recommended a dividend of '' 13/- per share for the year ended 31^st March 2023 and dividend payout ratio of 7.76%, absorbing a sum of ^ 2,465.79/- lakhs, for approval of the shareholders at the ensuing annual general Meeting.

Transfer of Unclaimed Dividend to IEPF:

Dividends that are unclaimed/unpaid for a period of seven years are required to be transferred to the Investor Education and Protection Fund (“IEPF”) administered by the Central Government, as per Companies Act 2013. An amount of '' 3,56,680/- (Rupees Three Lakhs Fifty-Six Thousand Six Hundred and Eighty only) being unclaimed Final dividend of the Company for the financial year ended 31^st March, 2015 was transferred in September, 2022 to IEPF.

3. PERFORMANCE

During the year 2022-23, the Company achieved highest ever total income of ^ 3,512 crores as against ^ 2,581 crores in the previous year. The profit before tax was ^ 427 crores as against

^ 196 crores in the previous year and the Profit after tax was ^ 318 crores as against ^ 142 crores in the previous year. There has been no change in the nature of business of the Company during the financial year ended 31^st March 2023.

4. CAPITAL EXPENDITURE

Capital expenditure of ^ 88.88 Crores was incurred during the year 2022-23 as against the revised estimate of ^ 121 Crores. Capital Expenditure of ^ 278 Crores is planned for the year 2023-24.

5. DIRECTORS

Mr. Alexander De Bock has resigned from the Board with effect from the close of business hours on 30^th March 2023 due to his resignation from the ZF Group. The Board expressed its deep sense of appreciation for Mr. Alex’s leadership and acknowledges his immense efforts and contributions towards his financial expertise and business decisions.

Retirement by rotation

Mr. Philippe Colpron, Non-executive and non-independent director, whose office is liable to retire at the ensuing AGM, being eligible, offer himself, for reappointment at the 19^th AGM of the Company scheduled to be held on 27^th July 2023.

The composition of the Board is in compliance with the Companies Act, 2013 (“the Act”) and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing regulations”) - three independent directors, two non-executive non-independent directors and an executive director as on date.

Independent Directors:

In terms of Section 149 of the Act and SEBI Listing Regulations, Mr. M Lakshminarayan, Dr. Lakshmi Venu and Mr. Mahesh Chhabria are the Independent Directors of the Company as on date of this report.

All Independent Directors of the Company have given requisite declarations under Section 149(7) of the Act, that they meet the criteria of independence as laid down under Section 149(6) of the Act along with Rules framed thereunder, Regulation 16(1)(b) of SEBI Listing Regulations and have complied with the Code of Conduct of the Company as applicable to the Board of Directors and Senior Management. In terms of Regulation 25(8) of the SEBI Listing Regulations, the Independent Directors have confirmed that they are not aware of any circumstance or situation, which exists or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgement and without any external influence. The Company has received confirmation from all the Independent Directors about their registration on the Independent Directors Database maintained by the Indian Institute of Corporate Affairs, in terms of Section 150 read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014.

In the opinion of the Board, the Independent Directors possess the requisite expertise and experience and are persons of high

integrity and repute. They fulfill the conditions specified in the Act as well as the Rules made thereunder and are independent of the management.

6. AUDITORS

M/s. B S R & Co. LLP, Chartered Accountants, holding firm Registration No 101248W / W-100022 have been appointed as statutory auditors of the Company by the shareholders for a term of five consecutive years from the conclusion of 15^th Annual General Meeting up to the conclusion of the 20^th Annual General Meeting as per the Section 139 of the Companies Act, 2013.

The Consolidated remuneration paid to Auditors / affiliated firms / entities for Audit and services rendered in other capacities is provided in the notes to the standalone financial statements.

The Auditors’ report for the financial year 2022-23 does not contain any qualification, reservation or adverse remark or disclaimer and the same is attached with the annual financial statements.

7. SECRETARIAL AUDITOR

M/s. S Krishnamurthy & Co., Company Secretaries have carried out Secretarial Audit under the provisions of Section 204 of the Act, for the financial year 2022-23 and submitted their report, which is annexed to this report. The report does not contain any qualification, reservation or adverse remark or disclaimer.

8. COST AUDITOR

As specified by the Central Government under Section 148(1) of the Companies Act, 2013, the cost records are required to be maintained by the Company and accordingly such accounts and records are being maintained. The Board of Directors of the Company upon recommendation made by the audit committee has re-appointed M/s A. N Raman & Associates, Cost Accountants, as Cost Auditor of the Company for the financial year ending 31^st March 2024 and has recommended his remuneration to the shareholders for their ratification at the ensuing Annual General Meeting.

The cost audit report for the year 2021-22 has been filed with the Ministry of Corporate Affairs in the prescribed form within due date. The cost audit report for the year 2022-23 will also be filed within the stipulated time.

During the year under review, the Statutory Auditors, Cost Auditors and Secretarial Auditor have not reported any instances of frauds committed in the Company by its Officers or Employees to the Audit Committee under Section 143(12) of the Companies Act, 2013.

9. KEY MANAGERIAL PERSONNEL

In terms of Section 203 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Key Managerial Personnel of the Company for the FY 2022-23 are:

Mr. P Kaniappan - Managing Director

Mr. R S Rajagopal Sastry - Chief Financial Officer

Ms. Muthulakshmi M - Company Secretary

10. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS During the year under review, the Company has not provided any Loan nor Guarantee nor security to any person or other body

corporate under Section 186 of the Act.

The Company had invested a sum of ^ 175 Lakhs as paid-up share capital (1,750,000 equity shares of ^ 10 each) in Enerparc Solar Power 3 Private Limited on 21^st March 2023 as part of Captive Power Purchase.

11. WHOLLY OWNED SUBSIDIARY

ZF CV Control Systems Manufacturing India Private Limited was incorporated with effect from 5^th January 2022 as a wholly owned subsidiary (WoS) of the Company, to Manufacture, buying, selling and trading in auto ancillary parts for domestic and export markets (Commercial Vehicle (CV) Control Systems).

The Share capital of the WoS is ? 100 Lakhs and it has commenced its commercial production with effect from 03^rd March 2023. The Revenue from Operations of WoS was at ? 62.98 Lakhs for the financial year ended 31^st March 2023 and the Profit after Tax for the year ended 31^st March 2023 was at ? 1.60 Lakhs. The Board of WoS has not recommended any dividend as it has just kick started its operations. Statement containing salient features of the financial statement of Subsidiary is given in Annexure 4 and forms part of this Report.

12. ANNUAL EVALUATION OF THE BOARD''S PERFORMANCE

The Board adopted a formal mechanism for evaluating its performance and as well as that of its Committees and Directors, including the Chairman of the Board as per the requirements as specified in the guidance note issued by the Securities Exchange Board of India (SEBI) and the provisions of the Companies Act, 2013. The performance evaluation exercise was carried out through a structured evaluation process (by circulation of detailed evaluation matrix to all the Directors and was reviewed & confirmed by each Director) covering various aspects of the functioning of the Board and Committees such as their composition, experience & competencies, performance of specific duties & obligations, governance issues etc.

NRC reviewed the performance of individual Directors on the basis of criteria as specified in the Guidance note and in a separate meeting of independent directors, performance of Non-Independent Directors and the Board as a whole was evaluated. The above evaluations were then discussed in the Board meeting and performance evaluation of Independent directors was done by the entire Board, excluding the Independent Director being evaluated and the Board was satisfied with their performances, which reflected the overall engagement of the Board, Committees and the directors with the Company.

13. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company believes in the conduct of the affairs of its constituents in a fair and transparent manner by adopting the highest standards of professionalism, honesty, integrity and ethical behaviour. In line with the ZF Code of Conduct (‘CoC’), any actual or potential violation, howsoever insignificant or perceived as such, would be a matter of serious concern for the Company. The role of the employees in pointing out such violations of the CoC cannot be undermined. Hence, the Company has established a vigil mechanism through “ZF

Commercial Vehicle Control Systems India Limited Whistle Blower Policy” to enable employees, trainees, directors and Vendors of the Company, to report genuine concerns, unethical behavior, actual or suspected fraud, violation of Company’s Insider Trading Code, any unlawful act or violation of the Company’s Code of Conduct. The mechanism provides for adequate safeguards against victimization of the whistle blower and also provides for direct access to the Chairman of the audit committee.

There were no whistle blower complaints received by the Company during the year.

14. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORTING

SEBI has mandated that the Business Responsibility and Sustainability Reporting (BRSR) shall be applicable to the top 1,000 listed entities (by market cap) for reporting on a mandatory basis from FY 2022-23. For the FY 2021-22, the company had published BRSR report voluntarily.

The Company is in 218^th Position (BSE) as per the market cap as on 31^st March 2023 and hence as per the SEBI Regulations, the Company has prepared the BRSR for the year ended March 31, 2023 as per the prescribed format which forms part of the annual report.

Mr. P Kaniappan, Managing Director of the Company is responsible for the implementation and oversight of the Policies relating to various principles of BRSR and to take forward the ESG initiatives.

15. STATUTORY STATEMENTS15.1 Conservation of energy, Research & Development Expenses and foreign exchange earnings and outgo

Information regarding conservation of energy, research & development expenses and foreign exchange earnings and outgo is given in Annexure 1 to this report, as per the requirements of Section 134(3)(m) of the Act.

During the financial year 2022-23, the Company had incurred a capital expenditure of ^ 244.48 lakhs towards installation of roof top solar panels at MWC Plant w.r.t. renewable energy commitments. Total of 55 energy reduction projects implemented during the year which yielded energy savings of 11.62 Lakhs units and cost savings of ^ 110.39 Lakhs per annum.

15.2 Corporate Social Responsibility

As required under Section 134(3)(o) of the Act, details about policy developed and implemented by the Company on Corporate Social Responsibility initiatives taken during the year ended 31^st March 2023 are given in Annexure 2 to this report.

15.3 Directors’ Responsibility Statement

Pursuant to Section 134(3)(c) of the Act, it is hereby confirmed that;

a. I n the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures.

b. The directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the

state of affairs of the Company as at 31^st March 2023 and of the profit of the Company for the year ended on that date;

c. That directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. The directors had prepared the annual accounts on a going concern basis;

e. The directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

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

16. DISCLOSURES UNDER COMPANIES ACT, 201316.1 Extract of the Annual Return:

In accordance with the Companies Act, 2013, the annual return in the prescribed format is available at https://www.zf.com/mobile/en/company/investor_relations/zf_cvjndiajnvestor_relations/zf_cvjndiajr.html

16.2 Number of Board Meetings:

The Board of Directors met six times during the year 2022-23. The details of the Board meetings and the attendance of the Directors is provided in the Corporate Governance Report.

16.3 Committees of Board of Directors:

Details of memberships and attendance of various committee meetings are given in Corporate Governance Report. The Board has accepted / considered all recommendations made by the Committees to the Board during the financial year.

16.4 Related Party Transactions:

All related party transactions that were entered into during the financial year were on an arm’s length basis and were in the ordinary course of business. There are no 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.

Approval of shareholders through postal ballot was obtained for the material related party transactions entered for the year ended 31^st March 2023 between the Company and M/S. ZF CV Systems Global GmbH & ZF CV Systems Europe BV, fellow subsidiaries of the Company, on 15.01.2022 and the actual transactions for the year ended 31^st March 2023 with these two entities was enclosed as Annexure - 5 to this report.

Also, prior approval of shareholders for the proposed material related party transactions for the financial year 2023-24 between the Company and M/s. ZF CV Systems Global GmbH & M/s. ZF CV Systems North America LLC, fellow subsidiaries of the company, were obtained through postal ballot on 12.03.2023.

The Company pays royalty to M/s ZF CV Systems Europe BV, a fellow subsidiary and related party at the rate of 4% per annum

Mr. M. Lakshminarayan, Independent Director	2.65:1
Mr. Mahesh Chhabria, Independent Director	2.98:1
Dr. Lakshmi Venu, Independent Director	2.09:1

18.3 The percentage increase in the median remuneration of employees in the financial year: 10%

18.4 The number of permanent employees on the rolls of company as on 31^st March 2023: 2181.

18.5 Average percentage increase already made in the salaries of employees other than the managerial personnel in the last financial year: 10.25% Percentage increase in the managerial remuneration in the last financial year: 22.65%. There are no exceptional circumstances for increase in the managerial remuneration. With respect to the Managerial Personnel, variable component is paid in the form of incentive, as per the remuneration policy of the Company and based on the financial and non-financial parameters and based on their individual performance and the performance of the Company. The Board at its meeting dated 24^th May 2023, approved the commission to be paid to nonexecutive independent directors as ^ 30 Lakhs to Mr. M. Lakshminarayan, ^ 35 Lakhs to Mr. Mahesh Chhabria and ^ 25 Lakhs to Dr. Lakshmi Venu respectively.

18.6 The key parameters for any variable component of remuneration availed by the directors: Independent directors have been paid sitting fees for attending meetings of the Board and Committees and paid a profit related commission, but not exceeding 1% of the net profit of the Company for the financial year. No sitting fee and commission is paid to non-executive and non-independent Directors of the Company. However, variable component is paid in the form of incentive, as per the Remuneration Policy of the Company and based on the financial and non-financial parameters, to Mr. P. Kaniappan, Managing Director.

18.7 The remuneration of Directors and employees are as per the remuneration policy of the Company.

on the net sales (Total sales (less) inter-company sales (less) intercompany purchases) effective 1^st January 2016 for the intellectual property, knowhow and processes supplied by ZF CV Systems Europe BV. M/s ZF CV Systems Europe BV charges Royalty to all its associated entities in line with the global practices and transfer pricing norms.

For the FY 2022-23, royalty of ^ 87.37 crores was paid to M/s ZF CV Systems Europe BV which amounts to 3.39 % of the total turnover for the financial year 2021-22.

All transactions with related parties are placed before the audit committee and prior approval of the audit committee is obtained. The Company has developed a Related Party Transactions Policy for the purpose of identification and monitoring of such transactions. Details of material Related Party Transactions entered by the company as required under Section 134(3)(h) of the Act and the Listing regulation are given in Annexure 5 to this report.

17. POLICIES

The following policies approved by the Board of Directors of the Company were uploaded and are available in the Company’s website at the web link:

https://www.zf.com/mobile/en/company/investor_relations/zf_cvjndiajnvestor_relations/zf_cvjndiajr.html

17.1.1 Code of Business conduct and ethics by the Board Members & Senior Management

17.1.2 Corporate Social Responsibility Policy

17.1.3 Related Party Transaction Policy

17.1.4 Nomination and Remuneration Policy

17.1.5 Whistle Blower Policy

17.1.6 Policy for Prohibition of Insider Trading

17.1.7 Policy on Criteria for Determining Materiality of Events

17.1.8 Dividend Distribution Policy

17.1.9 Corporate Governance Policy

17.1.10 Policy on Familiarisation of Independent Directors and Other Programs

17.1.11 Material subsidiary policy

17.2 Company’s policy on directors’ appointment and remuneration including criteria determining for qualification, positive attributes, independence of a director and other matters provided under Section 178(3) of the Act is provided in the Corporate Governance Report.

18. PARTICULARS OF DISCLOSURES AS REQUIRED UNDER SECTION 197 OF THE COMPANIES ACT, 2013

18.1 The ratio of the remuneration of each director to the median remuneration of the employees for the financial year and such other details as required are as given below:

Name	Ratio
Mr. P. Kaniappan, Managing Director	45.98:1

Directors other than those mentioned above have not drawn any remuneration including Sitting Fees & Commission, for the financial year 2022-23.

18.2 The percentage increase in remuneration of each Director, Managing Director, Chief Financial Officer and Company Secretary in the financial year are as follows:

Mr. M. Lakshminarayan, Independent Director	42.86
Mr. Mahesh Chhabria, Independent Director	17.18
Dr. Lakshmi Venu, Independent Director	20.72
Mr. P. Kaniappan, Managing Director	9.85
Mr. R.S Rajagopal Sastry, Chief Financial Officer	11.55
Ms. M. Muthulakshmi, Company Secretary	16.08

18.8 The statement of particulars of employees as per Section 197 of the Companies Act, 2013, read with Rule 5(2) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014, for the year ended 31^st March 2023, is given in Annexure 6 and forms part of this Report.

19. CORPORATE GOVERNANCE

The Company has complied with the provisions of the Listing Regulations concerning corporate governance and a report to this effect is attached, as required by Under Schedule V of the Listing Regulation. The certificate issued by the auditors of the Company regarding compliance with the corporate governance requirements is also annexed to this report. The Managing Director (CEO) and the Chief Financial Officer (CFO) of the Company have certified to the board on financial statements and other matters in accordance with Regulation 17(8) of the Listing Regulations pertaining to CEO / CFO certification for the financial year ended 31^st March 2023. Further, applicable Secretarial Standards have been complied with. The management discussion and analysis report, as required by the Listing Regulation and various disclosures required under the Act is also attached and forms part of this report.

20. FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

The Company has a structured familiarization program for independent Directors of the Company which also extends to other Non-Executive Directors to ensure that Directors are familiarized with their function, role, rights, responsibilities and the nature of the company Business viz., automotive component industry and ZF global business model, etc. The Board of Directors has complete access to the information within the Company. Presentations are made to the Board of Directors at all the Meetings and all Committees of the Board on various matters, where Directors get an opportunity to interact with Senior Management. Presentations, inter alia, cover the Company’s strategy, business model, operations, markets, organization structure, product offerings, finance, risk management framework, quarterly and annual results, human resources, technology, quality and such other areas as may arise from time to time.

The Company also issues appointment letters to the Independent Directors which also incorporates their role, duties and responsibilities. Further, regulatory updates on regulatory changes are also periodically placed before the Board. The details of familiarisation programme have been hosted in the web site of the Company under the weblink https://www.zf.com/mobile/en/company/investor_relations/zf_cvjndiajnvestor_relations/zf_cvjndiajr.html

21. OTHER PARTICULARS

• The Company has not accepted any deposits from the public within the meaning of Sections 76 of the Companies Act, 2013 for the year ended 31^st March 2023.

• There are no significant and material orders passed by regulators or courts or tribunals, which would impact the going concern status of the Company and its future operations.

• The Company does not have any associate or joint venture during the financial year 2022-23, apart from one wholly owned subsidiary.

• The Company has not raised any funds during the year.

• The Company has not taken any loan during the year and neither there are any outstanding loans as on 31^st March 2023. Hence there were no instances of any one time settlement nor any valuation done in this regard.

• The Company neither filed an application during the year under review nor there are any proceedings pending against the Company under the Insolvency and Bankruptcy Code, 2016 as at March 31,2023.

• The Company has not transferred any amount to general reserves during the year ended 31^st March 2023.

• There are no material changes and commitments, affecting the financial position of the company which have occurred between the end of the financial year 31^st March 2023 and at the date of this report.

• DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013 - The Company has adopted the AntiSexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. In compliance with the provisions under Section 4 of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013, Internal Complaints Committee (ICC) of the Company has been constituted to redress complaints regarding sexual harassment. No complaint was received during the year 2022-23.

Acknowledgement

The directors thank the vehicle manufacturers, distributors, vendors and bankers for their continued support and assistance. The directors gratefully acknowledge the support rendered by ZF Friedrichshafen AG. The directors wish to place on record their appreciation of the excellent work done by employees of the Company at all levels during the year. The directors specially thank the shareholders for the confidence reposed by them in the Company.

For and on behalf of the board M. LAKSHMINARAYAN

Chennai Chairman

24^th May 2023 DIN: 00064750

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Mar 31, 2022

The directors have pleasure in presenting the 18^th annual report and the audited (Standalone & Consolidated) financial statements for the financial year ended 31^st March 2022.

1. FINANCIAL HIGHLIGHTS

$ in lakhs
Standalone Consolidated*
Particulars Year ended 31.03.2022		Year ended Year ended 31.03.2021 31.03.2022
Revenue from Operations	254,335.39	186,350.01	254,335.39
Other Income	3,752.92	3,888.86	3,752.92
Total Income	258,088.31	190,238.87	258,088.31
Profit before interest depreciation and tax	29,007.64	24,465.64	29,007.64
Finance Costs	190.18	199.19	190.18
Depreciation	9,243.17	9,039.93	9,243.17
Profit before tax	19,574.29	15,226.52	19,574.29
Provision for taxation (including deferred tax and tax relating to earlier years)	5,366.85	4,846.03	5,366.85
Profit after tax	14,207.44	10,380.49	14,207.44
Other Comprehensive Income / (Loss) for the year net of tax	(353.58)	(194.90)	(353.58)
Total Comprehensive Income
for the year Net of Tax	13,853.86	10,185.59	13,853.86

* Consolidation of financials has become mandatory, since incorporation of Wholly owned subsidiary Company (ZF CV Control Systems Manufacturing India Private Limited) w.e.f. 5^th January 2022.

2. DIVIDEND

The Board of Directors has recommended a dividend of $ 12/- per share for the year ended 31^st March 2022 absorbing a sum of $ 2276.11/- lakhs, for approval of the shareholders at the ensuing annual general Meeting.

Transfer of Unclaimed Dividend to IEPF:

Under the Act, dividends that are unclaimed/ unpaid for a period of seven years are required to be transferred to the Investor Education and Protection Fund ("IEPF") administered by the Central Government. An amount of $ 357,800/- (Rupees three lakh fifty seven thousand eight hundred only) being unclaimed / unpaid dividend of the Company for the financial year ended 31^st March, 2014 was transferred in September, 2021 to IEPF.

3. PERFORMANCE

During the year 2021-22, the Company achieved total income of $ 2,581 crores as against $ 1,902 crores in the previous year. The profit before tax was $ 196 crores as against $ 152 crores in the previous year and the Profit after tax was $ 142 crores as

against $ 104 crores in the previous year. There has been no change in the nature of business of the Company during the financial year ended 31^st March 2022.

4. CHANGE IN OWNERSHIP & COMPLETION OF INTEGRATION

On 28^th March 2019, WABCO Holdings Inc., US the ultimate parent company of WABCO India Ltd., had announced to the New York stock exchange through a press release that it has entered into a definitive merger agreement with ZF Friedrichshafen AG ("ZF"), a privately held global leader in driveline and chassis technologies. This resulted in an indirect acquisition by ZF from WABCO USA of 1,42,25,684 equity shares of the Company, constituting 75% of its total voting share capital, making ZF as the Promoter of the Company in the place of WABCO USA. This indirect acquisition mandated ZF to make an Open Offer to the Company''s public shareholders, to acquire upto 47,41,900 fully paid up equity shares of Rs.5/- each, constituting 25% of the voting share capital of the Company, in terms of Regulations 3(1), 4 and 5(1) of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (SAST).

Accordingly, ZF, along with entities acting in concert with them (PAC), made the Open Offer at an offer price of $ 7,067.51 per Equity Share. The Committee of Independent Directors constituted by the Company for this purpose provided its written reasoned recommendations on the Open Offer, which was published in newspapers as stipulated under Regulation 26 of SAST on 11^th August 2020. The Open Offer opened on 13^th August 2020 and closed on 26^th August 2020. In response to the Open Offer, 34,34,775 equity shares of the Company were tendered by the public shareholders and were acquired by ZF International UK Limited, a PAC (ZF UK). This constituted 18.11% of the total voting share capital of the Company. Consequently, the Promoters'' shareholding in the Company increased to 1,76,60,459 equity shares constituting to 93.11%.

In order to ensure continued listing of the Company, the Promoters'' shareholding in the Company has to be brought down to 75% in terms of Securities Contracts (Regulation), Rules, 1957, to ensure minimum public shareholding of 25%.

i. ZF UK made an Offer for Sale (OFS) of 17,17,388 equity shares representing 9.05% of the total issued and paid-up equity share capital of the Company on March 25, 2021 and additional equity shares of 17,17,387 representing 9.05% of the total issued and paid-up equity share capital of the Company on March 26, 2021. Consequently, the Company had cumulatively sold 2,404,343 equity shares to non-Retail investors and Retail investors on the basis of valid bids received on T day (i.e. March 25, 2021) and T 1 day (i.e. March 26, 2021), thereby reducing the Promoters'' shareholding in the Company to 80.43%.

ii. In the second phase, ZF UK made an Offer for Sale (OFS) of 5,00,000 equity shares through the stock exchange mechanism representing 2.64% of the total issued and paid-up equity share capital on the 23^rd June 2021 and additional equity shares of

1,50,000 representing 0.79% of the total issued and paid-up equity share capital of the Company on 24^th June, 2021. Consequently, the Company have cumulatively sold 650,000 equity shares of the Company to non-Retail investors and Retail investors on the basis of valid bids received on T day (i.e. June 23, 2021) and T 1 day (i.e. June 24, 2021), thereby reducing the Promoters'' shareholding in the Company to 77.01%.

iii. In the third phase, ZF UK made an Offer for Sale (OFS) of 3,80,432 equity shares through the stock exchange mechanism representing 2.01% of the total paid up equity share capital of the Company on 25^th August 2021 and 26^th August, 2021. A total of 3,80,432 equity shares of the Company were sold in the OFS, thereby reducing the Promoters'' shareholding in the Company to 75.00% (1,42,25,684 equity shares).

ZF Friedrichshafen AG had announced successful completion of integration of WABCO and start of its new "Commercial Vehicle Solutions (CVS)" division with effect from January 1, 2022 and the new CVS division combines ZF''s former Commercial Vehicle Technology and Commercial Vehicle Control Systems (formerly WABCO) divisions. The CVS division of ZF will significantly provide advance solutions for safe, sustainable and digitized transport.

In line with successful completion of integration of WABCO into ZF and start of new CVS Division, the name of the Company has been changed from WABCO India Limited to "ZF COMMERCIAL VEHICLE CONTROL SYSTEMS INDIA LIMITED" with effect from 07^th March 2022, with the approval of the members through postal ballot process.

5. CAPITAL EXPENDITURE

Capital expenditure of $ 120.26 Crores was incurred during the year 2021-22 as against the revised estimate of $ 110 Crores excluding the cost of $ 75.59 crores paid towards the acquisition of land at Oragadam. Capital Expenditure of $ 105 Crores is planned for the year 2022-23.

6. DIRECTORS

There are no changes in the composition of the Board of Directors of the Company when compared to previous year and the composition of the Board, is in compliance with the Companies Act, 2013 ("the Act") and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing regulations") - three independent directors, three non-executive non-independent directors and an executive director as on date.

The independent directors continue to fulfill the criteria of independence as defined under Section 149(6) of the Act and Regulation 16(b) of Listing regulations and have furnished the requisite declarations in this regard and the Board confirms that they are independent of the management.

Change in designation / re-appointment, during the year, as follows:

• Change in designation of Mr. Alexander Ignace De Bock to "Director" on his appointment at the AGM on 24^th September 2021.

• Re-appointment of Mr. Philippe Colpron - retiring by rotation.

• Re-appointment of Dr. Lakshmi Venu as Non-Executive Independent Director from 19^th May 2021 (5 years).

7. AUDITORS

M/s. B S R & Co. LLP, Chartered Accountants, holding firm Registration No 101248W / W-100022 have been appointed as statutory auditors of the Company by the shareholders for a term of five consecutive years from the conclusion of 15^th Annual General Meeting up to the conclusion of the 20^th Annual General Meeting as per the Section 139 of the Companies Act, 2013.

The Consolidated remuneration paid to Auditors / affiliated firms / entities for Audit and services rendered in other capacities is provided in the notes to the standalone financial statements.

The Auditors'' report for the financial year 2021-22 does not contain any qualification, reservation or adverse remark or disclaimer and the same is attached with the annual financial statements.

8. SECRETARIAL AUDITOR

M/s. S Krishnamurthy & Co., Company Secretaries have carried out Secretarial Audit under the provisions of Section 204 of the Act, for the financial year 2021-22 and submitted their report, which is annexed to this report. The report does not contain any qualification, reservation or adverse remark or disclaimer except the following:-

1. Delay in transfer of unspent CSR Amount to a separate bank account for the ongoing projects for the FY 2020-21. The funds were transferred on 30^th June 2021 instead of within 30 days from the close of FY. The delay is mainly on account of complete lockdown as imposed in the state of Tamilnadu due to second wave of COVID-19.

2. Delay of one day shorter in sending AGM Notice instead of 21 clear days is due to second wave of COVID-19 in the State of Tamil Nadu. The Company obtained an opinion from legal experts which confirms that this does not affect the validity of the resolutions passed and business transacted at the AGM.

9. COST AUDITOR

As specified by the Central Government under Section 148(1) of the Companies Act, 2013, the cost records are required to be maintained by the Company and accordingly such accounts and records are being maintained. The Board of Directors of the Company upon recommendation made by the audit committee has re-appointed M/s A. N Raman & Associates, Cost Accountants, as Cost Auditor of the Company for the financial year ending 31^st March 2023 and has recommended his remuneration to the shareholders for their ratification at the ensuing Annual General Meeting.

The cost audit report for the year 2020-21 has been filed with the Ministry of Corporate Affairs in the prescribed form. The cost audit report for the year 2021-22 will also be filed within the stipulated time.

During the year under review, the Statutory Auditors, Cost Auditors and Secretarial Auditor have not reported any instances of frauds committed in the Company by its Officers or Employees to the Audit Committee under Section 143(12) of the Companies Act, 2013.

10. KEY MANAGERIAL PERSONNEL

The following are the Key Managerial Personnel of the Company pursuant to Sections 2(51) and 203 of the Companies Act, 2013 read

with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:

Mr. P Kaniappan - Managing Director Mr. R S Rajagopal Sastry - Chief Financial Officer Ms. Muthulakshmi M - Company Secretary (with effect from 3^rd November 2021)

Mr. M C Gokul, Company Secretary of the Company resigned from the Company with effect from close of business hours on 1^st November 2021.

11. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The Company has not provided any Loans or Guarantees to any person or other body corporate under Section 186 of the Act.

The Company had invested a sum of $ 100 Lakhs as paidup share capital (1,000,000 equity shares of INR 10 each) in its wholly owned subsidiary i.e. ZF CV Control Systems Manufacturing India Private Limited which got incorporated with effect from 5^th January 2022.

12. WHOLLY OWNED SUBSIDIARY

ZF CV Control Systems Manufacturing India Private Limited was incorporated with effect from 5^th January 2022 as a wholly owned subsidiary of the Company, to Manufacture, buying, selling and trading in auto ancillary parts for domestic and export markets (Commercial Vehicle (CV) Control Systems). The Share capital of the WoS is $ 100 Lakhs.

The Wholly owned subsidiary filed the Commencement of Business with Ministry of Corporate Affairs and it is yet to start operations.

13. ANNUAL EVALUATION OF THE BOARD''S PERFORMANCE

During the year, the Board adopted a formal mechanism for evaluating its performance and as well as that of its Committees and directors, including the Chairman of the Board as per the requirements in this regard specified in the guidance note issued by the Securities Exchange Board of India (SEBI) and the provisions of the Companies Act, 2013. The exercise was carried out through a structured evaluation process covering various aspects of the functioning of the Board and Committees such as their composition, experience & competencies, performance of specific duties & obligations, governance issues etc. Separate exercise was carried out to evaluate the performance of each individual director including the Chairman who were evaluated on parameters such as attendance, contribution at the meetings, independent judgment and other relevant aspects as laid down under the Guidance note issued by SEBI in this regard.

The Board was satisfied with the evaluation results, which reflected the overall engagement of the Board, Committees and the directors with the Company.

14. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has established a vigil mechanism through "ZF Commercial Vehicle Control Systems India Limited Whistle Blower Policy" to enable employees, trainees, directors and Vendors of the Company, to report genuine concerns, unethical behavior, actual or suspected fraud, violation of Company''s Insider Trading Code, any unlawful act or violation of the Company''s Code of Conduct.

The mechanism provides for adequate safeguards against victimization of the whistle blower and also provides for direct access to the Chairman of the audit committee in appropriate or exceptional cases or chief ethics officer of the Company as the case may be to report any concerns or unethical activities.

There were no whistle blower complaints received by the Company during the year.

15. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORTING

SEBI has mandated that the Business Responsibility and Sustainability Reporting (BRSR) will be applicable to the top 1,000 listed entities (by market cap) for reporting on a voluntary basis for FY 2021-22 and on a mandatory basis from FY 2022-23.

The Company is one among the top 1000 listed companies (272^nd Position-BSE) as per the market cap as on 31^st March 2022 and hence as per the SEBI Regulations, the Company has decided to go ahead with BRSR for the FY 2021-22 which forms part of the annual report. As per this policy Mr. P Kaniappan, Managing Director is responsible for the implementation of the BRSR. The initiatives of the Company in this regard for the year 2021-22 are provided in the BRSR Report.

16. STATUTORY STATEMENTS16.1 Conservation of energy, Research & Development Expenses and foreign exchange earnings and outgo

Information regarding conservation of energy, Research & Development expenses and foreign exchange earnings and outgo is given in Annexure 1 to this report, as per the requirements of Section 134(3)(m) of the Act.

During 2021-22, the Company had incurred a capital expenditure of $ 219.87 lakhs towards a total of 55 energy reduction projects implemented during the year in air conditioners, compressed air systems and other projects which yielded energy savings of $ 8.94 Lakhs units and cost savings of $ 71.52 Lakhs per annum.

16.2 Corporate Social Responsibility

As required under Section 134(3)(o) of the Act, details about policy developed and implemented by the Company on Corporate Social Responsibility initiatives taken during the year ended 31^st March 2022 are given in Annexure 2 to this report.

16.3 Directors'' Responsibility Statement

Pursuant to Section 134(3)(c) of the Act, it is hereby confirmed that;

a. In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures.

b. The directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31^st March 2022 and of the profit of the Company for the year ended on that date;

c. That directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. The directors had prepared the annual accounts on a going concern basis;

e. The directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

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

17. DISCLOSURES UNDER COMPANIES ACT, 2013

17.1 Extract of the Annual Return

The Annual Return of the Company in form MGT-7 for the year ended 31^st March 2021 is available on the website of the Company in the following link

https://www.zf£omimobile/enicompanyiinveslor_relafons/zf_cvjndiajnvestor_relations/zf_cvjndiajr.html#accordion_2_714125_0

17.2 Number of Board Meetings

The Board of Directors met six times during the year 2021-22. The details of the Board meetings and the attendance of the Directors is provided in the Corporate Governance Report.

17.3 Committees of Board of Directors

Details of memberships and attendance of various committee meetings are given in Corporate Governance Report. The Board has accepted / considered all recommendations made by the Committees to the Board during the financial year.

17.4 Related Party Transactions

All related party transactions that were entered into during the financial year were on an arm''s length basis and were in the ordinary course of business. There are no 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.

Certain related party transactions entered into during the year ended 31^st March 2022 and transactions proposed to be entered into during the year ending 31^st March 2023 between the Company and M/S. ZF CV Systems Europe BV, a fellow subsidiary of the Company, are material in nature and require the approval of members by ordinary resolution as per the SEBI (LODR) Regulations. An ordinary resolution seeking shareholders'' approval for the financial year ended 31^st March 2022 has been obtained in the Board Meeting held on 17^th May 2021 and an ordinary resolution seeking shareholders'' approval for the financial year ended 31^st March 2023 has been passed through postal ballot on 15.01.2022.

Similarly, certain related party transactions entered into during the year ended 31^st March 2022 and transactions proposed to be entered into during the year ending 31^st March 2023 between the Company and M/S. ZF CV Systems Global GmbH, Switzerland, a fellow subsidiary of the company, are material in nature and require the approval of members by ordinary resolution as per the SEBI (LODR) Regulations. An ordinary resolution seeking shareholders'' approval has been passed through postal ballot on 15.01.2022. (for FY 2021-22 & 2022-23).

The Company pays royalty to M/s ZF CV Systems Europe BV (Formerly WABCO Europe BVBA), a fellow subsidiary and related party at the rate of 4% per annum on the net sales (Total sales (less) inter-company sales (less) inter-company purchases) effective 1^stJanuary 2016 for the intellectual property, knowhow and processes supplied by ZF CV Systems Europe BV. M/s ZF CV Systems Europe BV charges Royalty to all its associated entities in line with the global practices and transfer pricing norms.

During the year ended 31^st March 2022 royalty of $ 58.08 crores was paid to M/s ZF CV Systems Europe BV which amounts to 3.14% of the total turnover for the financial year 2020-21.

All transactions with related parties are placed before the audit committee and prior approval of the audit committee is obtained. The Company has developed a Related Party Transactions Policy for the purpose of identification and monitoring of such transactions. Details of material Related Party Transactions entered by the company as required under Section 134(3)(h) of the Act and the Listing regulation are given in annexure 4 to this report.

18. POLICIES

18.1 The following policies approved by the Board of Directors of the Company were uploaded and are available in the Company''s website at the web link:

hlps://www.^^.com/mobile/en/companJ/invtslo[J¦elalions/zf_cvjn(liajrveslD[J¦elalionslzf_cv_indiaj[.hlmllpoliciesandoodeofcondllcl_acc_65ffl2_0

18.1.1 Code of Business conduct and ethics by the Board Members & Senior Management

18.1.2 Corporate Social Responsibility Policy

18.1.3 Related Party Transaction Policy

18.1.4 Nomination and Remuneration Policy

18.1.5 Whistle Blower Policy

18.1.6 Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information

18.1.7 Policy on Criteria for Determining Materiality of Events

18.1.8 Dividend Policy

18.2 Policy on director appointment and remuneration

Company''s policy on directors'' appointment and remuneration including criteria determining for qualification, positive

Directors other than those mentioned above have not drawn any remuneration including Sitting Fees & Commission, for the financial year 2021-22.

19.2 The percentage increase in remuneration of each Director, Managing Director, Chief Financial Officer, Company Secretary, in the financial year:

attributes, independence of a director and other matters provided under Section 178(3) of the Act is provided in the Corporate Governance Report.

19. PARTICULARS OF DISCLOSURES AS REQUIRED UNDER SECTION 197 OF THE COMPANIES ACT, 2013

19.1 The ratio of the remuneration of each director to the median employee''s remuneration for the financial year and such other details as prescribed are as given below:

Name	Ratio
Mr. P. Kaniappan, Managing Director	47.86:1
Mr. M. Lakshminarayan - Independent Director	2.38:1
Mr. Mahesh Chhabria, Independent Director	3.26:1
Dr. Lakshmi Venu, Independent Director	2.22:1

Mr. M. Lakshminarayan, Chairman	(9.16)
Mr. Mahesh Chhabria, Director	45.96
Dr. Lakshmi Venu, Director	(12.60)
Mr. P. Kaniappan, Managing Director	(35.09)
Mr. R.S Rajagopal Sastry, Chief Financial Officer	(51.52)
Mr. M.C. Gokul Company Secretary *	(63.23)
Ms. M. Muthulakshmi, Company Secretary **	-

* Mr. M.C. Gokul, Company Secretary of the Company resigned from the Company with effect from closs of business hours on 1^st November 2021.

** Ms. M. Muthulakshmi, Company Secretary of the Company joined the Company with effect from 3^rd November 2021.

19.3 The percentage increase in the median remuneration of employees in the financial year: 8%

19.4 The number of permanent employees on the rolls of company as on 31^st March 2022: 1960.

19.5 Average percentage increase already made in the salaries of employees other than the managerial personnel in the last financial year: 9%

Percentage increase in the managerial remuneration in the last financial year was (31.40%). There are no exceptional circumstances for increase in the managerial remuneration. With respect to the Managerial Personnel, variable component is paid in the form of incentive, as per the remuneration policy of the Company and based on the financial and non-financial parameters based on their individual performance and the performance of the Company. The Board at its meeting dated

20^th May 2022, approved the commission to be paid to nonexecutive independent directors to $ 20 Lakhs per independent director. Further an additional amount of $ 10 Lakhs be paid to Mr. Mahesh Chhabria for the efforts and time spent by him and as Chairman of the Audit Committee in managing the overall efforts towards the conduct of the forensic audit as required by Law.

19.6 The key parameters for any variable component of remuneration availed by the directors: Independent directors have been paid sitting fees for attending meetings of the Board and Committees and also paid a profit related commission, but not exceeding 1% of the net profit of the Company for the financial year. No sitting fee and commission is paid to non-executive and non-independent Directors of the Company. However, with respect to Mr. P. Kaniappan, Managing Director, variable component is paid in the form of incentive, as per the Remuneration Policy of the Company and based on the financial and non-financial parameters.

19.7 The remuneration of directors and employees are as per the remuneration policy of the Company.

19.8 Particulars of Employees

The statement of particulars of employees as per Section 197 of the Companies Act, 2013, read with Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014, for the year ended 31^st March 2022, is given in Annexure 5 and forms part of this Report.

20. CORPORATE GOVERNANCE

The Company has complied with the provisions of the Listing Regulations concerning corporate governance and a report to this effect is attached, as required by Under Schedule V of the Listing Regulation. The certificate issued by the auditors of the Company regarding compliance with the corporate governance requirements is also annexed to this report. The Managing Director (CEO) and the Chief Financial Officer (CFO) of the Company have certified to the board on financial statements and other matters in accordance with Regulation 17(8) of the Listing Regulations pertaining to CEO / CFO certification for the financial year ended 31^st March 2022. Further, applicable Secretarial Standards have been complied with.

The management discussion and analysis report, as required by the Listing Regulation and various disclosures required under the Act is also attached and forms part of this report.

21. FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

The Company has a structured familiarization program for independent Directors of the Company which also extends to other

Non-Executive Directors to ensure that Directors are familiarized with their function, role, rights, responsibilities and the nature of the company Business viz., automotive component industry and ZF global business model, etc.

The Board of Directors has complete access to the information within the Company. Presentations are regularly made to the Board of Directors and all Committees of the Board on various matters, where Directors get an opportunity to interact with Senior Management. Presentations, inter alia, cover the Company''s strategy, business model, operations, markets, organization structure, product offerings, finance, risk management framework, quarterly and annual results, human resources, technology, quality and such other areas as may arise from time to time.

The Company also issues appointment letters to the Independent Directors which also incorporates their role, duties and responsibilities. Further, regulatory updates on regulatory changes are also periodically placed before the Board. The details of familiarisation programme have been hosted in the web site of the Company under the weblink htlps:liwww.zf.com/mobile/en^|companjlirveslD[_[elationslzf_cv_in(iajnveslD[_[elationslzf_cvjndiaj[.himllboa[d_of_di[eclo[s_aa:_656413_0

22. OTHER PARTICULARS

• The Company has not accepted any deposits from the public within the meaning of Sections 76 of the Companies Act, 2013 for the year ended 31^st March 2022.

• There are no significant and material orders passed by regulators or courts or tribunals, which would impact the going concern status of the Company and its future operations.

• The Company does not have any associate or joint venture during the financial year 2021-22.

• The Company has not raised any funds during the year.

• The Company has not taken any loan during the year and neither there are any outstanding loans as on 31^st March 2022. Hence there were no instances of any on time settlement nor any valuation done in this regard.

• The Company neither filed an application during the year under review nor there are any proceedings pending under the Insolvency and Bankruptcy Code, 2016 as at March 31, 2022.

• The Company has not transferred any amount to general reserves during the year ended 31^st March 2022.

• There are no material changes and commitments, affecting the financial position of the company which have occurred between the end of the financial year 31^st March 2022 and at the date of the report.

• DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013 The Company has adopted the Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. In compliance with the provisions under Section 4 of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013, Internal Complaints Committee (ICC) of the Company has been constituted to redress complaints regarding sexual harassment. No complaint was received during the year 2021-22.

Acknowledgement

The directors thank the vehicle manufacturers, distributors, vendors and bankers for their continued support and assistance. The directors gratefully acknowledge the support rendered by ZF Friedrichshafen AG. The directors wish to place on record their appreciation of the excellent work done by employees of the Company at all levels during the year. The directors specially thank the shareholders for the confidence reposed by them in the Company.

For and on behalf of the board

M. LAKSHMINARAYAN Chennai Chairman

20^th May 2022 DIN: 00064750

---

Mar 31, 2021

The directors have pleasure in presenting the 17^th annual report and the audited financial statements for the financial year ended 31^st March 2021.

1. FINANCIAL HIGHLIGHTS

$ in lakhs
Details	Year ended 31.03.2021	Year ended 31.03.2020
Revenue from Operations	186,350.01	192,956.15
Other Income	3,888.86	6,388.05
Total Income	190,238.87	199,344.20
Profit before interest depreciation and tax	24,465.64	31,536.73
Finance Costs	199.19	191.94
Depreciation	9,039.93	9,011.08
Profit before tax	15,226.52	22,333.71
Provision for taxation (including deferred tax and tax relating to earlier years)	4,846.03	6,452.34
Profit after tax	10,380.49	15,881.37
Other Comprehensive Income / (Loss) for the year net of tax	(194.90)	(79.66)
Total Comprehensive Income for
the year Net of Tax	10,185.59	15,801.71

2. DIVIDEND

The Board of Directors has recommended a dividend of $ 11/- per share for the year ended 31^st March 2021 absorbing a sum of $ 2,086.43/- lakhs for approval of the shareholders at the ensuing annual general Meeting.

3. PERFORMANCE

During the year 2020-21, the Company achieved total income of $ 1,902 crores as against $ 1,993 crores in the previous year. The profit before tax was $ 152 crores as against $ 223 crores in the previous year and the Profit after tax was $ 104 crores as against $ 159 crores in the previous year. There has been no change in the nature of business of the Company during the financial year ended 31^st March 2021.

4. CHANGE IN OWNERSHIP

On 28^th March 2019, WABCO Holdings Inc., US the ultimate parent company of WABCO India Ltd., had announced that it has entered into a definitive merger agreement with ZF Friedrichshafen AG ("ZF"), a privately held global leader in driveline and chassis technologies.

Under this agreement, ZF had acquired all outstanding shares of WABCO Holdings Inc., US for $136.50 per share in an all-cash

transaction for an equity value of over $7 billion. This transaction concluded in May 2020. This transaction brought together two global technology leaders with highly complementary and innovative technology offerings to address future serving OEMs and fleets in the automotive and commercial vehicle industry, combining WABCO''s capabilities in commercial vehicle safety and efficiency, including technologies involved in vehicle dynamics control, active air suspension systems, and fleet management systems with ZF''s leading position in driveline and chassis technologies for cars and commercial vehicles.

The said transaction, resulted in the indirect acquisition by ZF of WABCO Asia Private Limited, an indirect subsidiary of WABCO Holdings LLP, US and holds 75% of the voting share capital of WABCO India Ltd. Accordingly, upon the completion of the said transaction, ZF became entitled to, through WABCO Asia.

(a) indirectly exercise 75% of the voting share capital.

(b) indirectly exercise control over WABCO India Limited.

Post conclusion of the transaction, as required under the SEBI (SAST) Regulations, an open offer was made to the shareholders in August 2020 for the acquisition of up to 4,741,900 fully paid-up equity shares of face value of $ 5/- each of WABCO India Limited, representing 25% of the total voting equity capital of WABCO India Limited, comprising fully of public shareholders was given by ZF Friedrichshafen AG. This public announcement excluded the promoters / promoter group of WABCO India Limited. Pursuant to the open offer, ZF International UK had acquired 18.11% of the shares from the public shareholders taking the consolidated promoter shareholding to 93.11%. To comply with the listing regulations of minimum public shareholding of 25%, ZF International, UK had in March 2021 sold 12.68% shares through offer for sale to the public shareholders. As on date, the consolidated promoter shareholding stands at 80.43%.

Post acquisition by ZF, the WABCO Group has become ZF CVCS division and operates as a seperate division until integration, which is expected to be complete by early 2022.

5. CAPITAL EXPENDITURE

Capital expenditure of $ 90.0 Crores was incurred during the year 2020-21 as against the revised estimate of $ 104.8 Crores and Capital Expenditure of $ 110.0 Crores is planned for the year 2021-22.

6. DIRECTORS

On the recommendation of the Nomination & Remuneration Committee, Dr. Lakshmi Venu, was re-appointed as an Independent Director by the Board with effect from 19^th May 2021 to 18^th May 2026 for another term of 5 consecutive years subject to the approval of shareholders at the ensuing Annual General Meeting through a special resolution.

Mr. Alexander De Bock was appointed as an Additional Director in terms of Section 161 of the Companies Act, 2013 by the Board on 25^th September 2020, who will hold office upto the ensuing Annual General Meeting. He being eligible and willing to be appointed as

director at the ensuing Annual General Meeting has offered himself for appointment as Director.

Ms. Lisa Brown resigned from the Board with effect from 31^st August 2020 due to her other commitments. The Board wishes to place on record its appreciation for the valuable guidance and services rendered by Ms. Lisa Brown during her tenure as Director.

The composition of the Board, taking into account the above changes, is in compliance with the Companies Act, 2013 ("the Act") and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing regulations") - three independent directors, three nonexecutive non-independent directors and an executive director as on date.

The independent directors continue to fulfill the criteria of independence as defined under Section 149(6) of the Act and Regulation 16(b) of Listing regulations and have furnished the requisite declarations in this regard and the Board confirms that they are independent of the management.

7. AUDITORS

M/s. B S R & Co. LLP, Chartered Accountants, holding firm Registration No 101248W / W-100022 have been appointed as statutory auditors of the Company by the shareholders for a term of five consecutive years from the 15^th Annual General Meeting upto the conclusion of the 20^th Annual General Meeting as per the Section 139 of the Companies Act, 2013.

The Consolidated remuneration paid to Auditors / affiliated firms / entities for Audit and services rendered in other capacities is provided in the notes to the financial statements.

8. MODIFIED AUDITOR''S REPORT

The Statutory Auditors have drawn attention to the financial statements of the Company for the year ended March 31, 2021 with respect to certain instances of alleged irregularities identified by management in disbursement / settlement of provident fund dues paid out of the Employees'' Provident Fund Trust (''the Trust'') and salary payments to fixed-tenure employees in the current and earlier years. The Company has initiated investigation of such alleged irregularities relating to payments from the Trust and other payments from the Company to employees by engaging an external independent expert through a law firm and is also evaluating necessary actions. The Company has made a preliminary assessment and has recorded a provision of $ 500 lakhs in the financial statements for the year ended 31^st March 2021. Pending completion of the aforesaid investigation, the statutory auditors have opined that they are unable to evaluate the likely outcome of the above matter and its consequential additional impact on these financial statements and hence have modified their report in this regard.

The Board of Directors based on the recommendations from the Audit Committee have reviewed the entire scope & summary presentations & observations and is of the view that there is no need to enhance the provision already made in the books and that the measures taken by the management to strengthen the

controls are adequate. Further, the management has been subject to multiple scrutiny in this regard and the risk mitigation approach is being strengthened and extended to all processes.

9. SECRETARIAL AUDITOR

M/s. S Krishnamurthy & Co., Company Secretaries have carried out Secretarial Audit under the provisions of Section 204 of the Act, for the financial year 2020-21 and submitted their report, which is annexed to this report. The report does not contain any qualification, reservation or adverse remark or disclaimer.

10. COST AUDITOR

As specified by the Central Government under Section 148(1) of the Companies Act, 2013, the cost records are required to be maintained by the Company and accordingly such accounts and records are being maintained. Pursuant to Section 148 of the Act, the Board of Directors of the Company upon recommendation made by the audit committee has re-appointed M/s A. N Raman & Associates, Cost Accountants, as Cost Auditor of the Company for the financial year ending 31^st March 2022 and has recommended his remuneration to the shareholders for their ratification at the ensuing Annual General Meeting.

11. KEY MANAGERIAL PERSONNEL

Mr. P Kaniappan - Managing Director

Mr. R S Rajagopal Sastry - Chief Financial Officer

Mr. M C Gokul - Company Secretary

12. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The Company has not provided any Loans or Guarantees to any person or other body corporate under Section 186 of the Act and the details of investments made are given in the notes to the Financial Statements.

13. ANNUAL EVALUATION OF THE BOARD''S PERFORMANCE

During the year, the Board adopted a formal mechanism for evaluating its performance and as well as that of its Committees and directors, including the Chairman of the Board as per the requirements in this regard specified in the guidance note issued by the Securities Exchange Board of India (SEBI) and the provisions of the Companies Act, 2013. The exercise was carried out through a structured evaluation process covering various aspects of the functioning of the Board and Committees such as their composition, experience & competencies, performance of specific duties & obligations, governance issues etc. Separate exercise was carried out to evaluate the performance of each individual director including the Chairman who were evaluated on parameters such as attendance, contribution at the meetings, independent judgment and other relevant aspects as laid down under the Guidance note issued by SEBI in this regard. The Board was satisfied with the evaluation results, which reflected the overall engagement of the Board, Committees and the directors with the Company.

14. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has established a vigil mechanism through "WABCO Whistle Blower Policy" to enable employees and directors to report genuine concerns dealing with instances of fraud and mismanagement, if any. The mechanism provides for adequate safeguards against victimization of the whistle blower and also provides for direct access to the Chairman of the audit committee in appropriate or exceptional cases or chief ethics officer of the Company as the case may be to report any concerns or unethical activities.

15. BUSINESS RESPONSIBILITY

The Company is one among the top 1000 listed companies as per the market cap as on 31^st March 2021 and hence as per the Listing regulations, the Business Responsibility Report forms part of the annual report. In this regard, the Company has developed a Business Responsibility policy which is approved by the Board. As per this policy Mr. P Kaniappan, Managing Director is responsible for the implementation of the Business Responsibility initiatives. The initiatives of the Company in this regard for the year 2020-21 are provided in the Business responsibility report.

16. STATUTORY STATEMENTS16.1 Conservation of energy, Research & Development Expenses and foreign exchange earnings and outgo

Information regarding conservation of energy, Research & Development expenses and foreign exchange earnings and outgo is given in Annexure 1 to this report, as per the requirements of Section 134(3)(m) of the Act.

Towards the Company''s continual commitment of utilizing renewable energy, the Company had commissioned a 400 KW roof top solar plant during the year 2018-19. This has resulted in increasing the overall renewable power share. During 2020-21, the Company had incurred a capital expenditure of $ 23 lakhs towards a total of 55 energy reduction projects implemented during the year in air conditioners, compressed air systems and other projects which yielded energy savings of 7.63 Lakh units and cost savings of $ 61.04 Lakhs per annum. Further, these initiatives have also resulted in carbon footprint reduction of about 540 Ton in Co2 emissions per annum.

16.2 Corporate Social Responsibility

As required under Section 134(3)(o) of the Act, details about policy developed and implemented by the Company on Corporate Social Responsibility initiatives taken during the year ended 31^st March 2021 are given in Annexure 2 to this report

16.3 Directors'' Responsibility Statement

Pursuant to Section 134(3)(c) of the Act, it is hereby confirmed that;

a. In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures.

b. The directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31^st March 2021 and of the profit of the Company for the year ended on that date;

c. That directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. The directors had prepared the annual accounts on a going concern basis;

e. The directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

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

17. DISCLOSURES UNDER COMPANIES ACT, 2013

17.1 Annual Return

The Annual Return of the Company in Form MGT-7 for the year ended 31^st March 2020 is available on the website of the Company in the following link: https://www.wabco-auto.com/india/Investor-Relations/WABCO-India-Investor-Relations

17.2 Number of Board Meetings

The Board of Directors met five times during the year 2020-21. The details of the Board meetings and the attendance of the Directors are provided in the Corporate Governance Report.

17.3 Committees of Board of Directors

Details of memberships and attendance of various committee meetings are given in Corporate Governance Report.

The Board has accepted / considered all recommendations made by the Committees to the Board during the financial year.

17.4 Related Party Transactions

All related party transactions that were entered into during the financial year were on an arm''s length basis and were in the ordinary course of business. There are no related party transactions made by the Company with promoters, Directors, Key Managerial Personnel or other designed persons which may have a potential conflict with the interest of the Company at large.

Certain related party transactions entered into during the year ended 31^st March 2021 and transactions proposed to be entered into during the year ending 31^st March 2022

Directors other than those mentioned above have not drawn any remuneration for the financial year 2020-21.

19.2 The percentage increase in remuneration of each Director, Managing Director, Chief Financial Officer, Company Secretary, in the financial year:

between the Company and ZF CV Systems Europe BV (formerly WABCO Europe BVBA), a fellow subsidiary of the company, are material in nature and require the approval of members through an ordinary resolution as per the Listing regulations. An ordinary resolution seeking shareholders'' approval is included in the notice to shareholders.

The Company pays royalty to M/s ZF CV Systems Europe BV, a fellow subsidiary and related party at the rate of 4% per annum on the net sales (Total sales (less) inter-company sales (less) inter-company purchases) effective 1^st January 2016 for the intellectual property, knowhow and processes supplied by ZF CV Systems Europe BV. M/s ZF CV Systems Europe BV charges Royalty to all its associated entities in line with the global practices and transfer pricing norms. During the year ended 31^st March 2021 royalty of $ 39.9 crores was paid to M/s. ZF CV Systems Europe BV which amounts to 2% of the total turnover for the financial year 2019-20.

All transactions with related parties are placed before the audit committee and prior approval of the audit committee is obtained. The Company has a Related Party Transactions Policy for the purpose of identification and monitoring of such transactions. Details of material Related Party Transactions entered by the Company as required under Section 134(3)(h) of the Act and the Listing Regulations are given in annexure 4 to this report

18. POLICIES

18.1 The following policies approved by the Board of Directors of the Company were uploaded and are available in the Company''s website at the web link: http://www.wabco-auto.com/en/investor_relations/wabco_india_investor_relations

18.1.1 Corporate Social Responsibility Policy

18.1.2 Related Party Transaction Policy

18.1.3 Nomination and Remuneration Policy

18.1.4 Whistle Blower Policy

18.1.5 Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information

18.1.6 Policy on Criteria for Determining Materiality of Events

18.1.7 Dividend Policy

18.2 Policy on director appointment and remuneration

Company''s policy on directors'' appointment and remuneration including criteria determining for qualification, positive attributes, independence of a director and other matters provided under Section 178(3) of the Act is provided in the Corporate Governance Report.

19. PARTICULARS OF DISCLOSURES AS REQUIRED UNDER SECTION 197 OF THE COMPANIES ACT, 2013

19.1 The ratio of the remuneration of each director to the median employee''s remuneration for the financial year and such other details as prescribed are as given below:

Name	Ratio
Mr. P. Kaniappan, Managing Director	68.96:1
Mr. M. Lakshminarayan, Independent Director	3.31:1
Mr. Mahesh Chhabria, Independent Director	2.82:1
Dr. Lakshmi Venu, Independent Director	3.21:1

Secretary, in the financial year:
Mr. M. Lakshminarayan, Chairman	52.33%
Mr. Mahesh Chhabria, Director	NA
Dr. Lakshmi Venu, Director	73.97%
Mr. P. Kaniappan, Managing Director	68.96%
Mr. R.S. Rajagopal Sastry, Chief Financial Officer	71.81%
Mr. M.C. Gokul, Company Secretary	94.41%

19.3 The percentage increase in the median remuneration of employees in the financial year: 5.61%.

19.4 The number of permanent employees on the rolls of company as on 31^st March 2021: 2023.

19.5 Average percentage increase already made in the salaries of employees other than the managerial personnel in the last financial year: 7.2%.

Percentage increase in the managerial remuneration in the last financial year was 70.68%. With respect to the Managerial Personnel, variable component is paid in the form of incentive, as per the remuneration policy of the Company and based on the financial and non-financial parameters based on their individual performance and the performance of the Company. Benefit arising out of participation in M/s WABCO Holdings Inc., RSU/PSU schemes is included in value of perquisites. All outstanding options were paid in June 2020 as per the terms of merger with ZF and the scheme stands closed since. This was a onetime activity. The Board at its meeting dated 17^th May 2021, increased the commission paid to non-executive independent directors to $ 20,00,000/- per independent director. The remuneration also includes sitting fee of $ 75,000/- per Independent Director per meeting for the Independent Directors Committee meetings. The committee

had met 4 times during the year in view of the Open offer requirements. All these have impacted the percentage increase in the managerial remuneration.

19.6 The key parameters for any variable component of remuneration availed by the directors: Independent directors have been paid sitting fees for attending meetings of the Board and Committees and also paid a profit related commission, but not exceeding 1% of the net profit of the Company for the financial year. No sitting fee and commission is paid to non-executive and non-independent Directors of the Company. However, with respect to Mr. P. Kaniappan, Managing Director, variable component is paid in the form of incentive, as per the Remuneration Policy of the Company and based on the financial and non-financial parameters.

19.7 The remuneration of directors and employees are as per the remuneration policy of the Company.

19.8 Particulars of Employees

The statement of particulars of employees as per Section 197 of the Companies Act, 2013, read with Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014, for the year ended 31^st March 2021, is given in Annexure 5 and forms part of this Report.

20. CORPORATE GOVERNANCE

The Company has complied with the provisions of the Listing Regulations concerning corporate governance and a report to this effect is attached, as required by Under Schedule V of the Listing Regulation. The certificate issued by the auditors of the Company regarding compliance with the corporate governance requirements is also annexed to this report. The Managing Director, (CEO) and the Chief Financial Officer (CFO) of the Company have certified to the board on financial statements and other matters in accordance with Regulation 17(8) of the Listing Regulations pertaining to CEO / CFO certification for the financial year ended 31^st March 2021. Further, applicable Secretarial Standards notified by the Institute of Company Secretaries of India, New Delhi, have been complied with.

The management discussion and analysis report, as required by the Listing Regulations and various disclosures required under the Act is also attached and forms part of this report.

21. FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

The Company has a structured familiarization program for independent Directors of the Company which also extends to other Non-Executive Directors to ensure that Directors are familiarized with their function, role, rights, responsibilities and the nature of the company Business viz., automotive component industry and the group’s global business model, etc.

The Board of Directors has complete access to the information within the Company. Presentations are regularly made to the Board of Directors and all Committees of the Board on various matters, where Directors get an opportunity to interact with Senior

Management. Presentations, inter alia, cover the Company''s strategy, business model, operations, markets, organization structure, product offerings, finance, risk management framework, quarterly and annual results, human resources, technology, quality and such other areas as may arise from time to time.

The Company also issues appointment letters to the Independent Directors which also incorporates their role, duties and responsibilities. Further, updates on regulatory changes are also periodically placed before the Board. The details of familiarisation programme have been hosted in the website of the Company under the weblink

http://wabco-auto.com/investor-relations/wabco-india-investorrelations

22. OTHER PARTICULARS

• The Company has not accepted any deposits from the public within the meaning of Sections 76 of the Companies Act, 2013 for the year ended 31^st March 2021.

• There are no significant and material orders passed by regulators or courts or tribunals, which would impact the going concern status of the Company and its future operations.

• The Company does not have any subsidiary, associate or joint venture. There was no Company which has become or ceased to be Company''s subsidiary, Joint venture or associate Company during the financial year 2020-21.

• The Company has not raised any funds during the year.

• The Company has not taken any loan during the year and neither there are any outstanding loans as on 31^st March 2021. Hence there were no instances of any one time settlement nor any valuation done in this regard.

• The Company has neither filed an application during the year under review nor are any proceedings pending under the Insolvency and Bankruptcy Code, 2016 as at March 31, 2021.

• The Company has not transferred any amount to general reserves during the year.

• There are no material changes and commitments, affecting the financial position of the company which have occurred between the end of the financial year and the date of the report.

Acknowledgement

The Directors thank the vehicle manufacturers, distributors, vendors and bankers for their continued support and assistance. The Directors gratefully acknowledge the support rendered by ZF Friedrichshafen AG. The directors wish to place on record their appreciation of the excellent work done by employees of the Company at all levels during the year. The directors specially thank the shareholders for the confidence reposed by them in the Company.

For and on behalf of the board

Chennai M. LAKSHMINARAYAN

17^th May 2021 Chairman

---

Mar 31, 2019

Directors’ report to the shareholders

The directors have pleasure in presenting the Fifteenth annual report and the audited financial statements for the financial year ended 31^st March 2019.

1. FINANCIAL HIGHLIGHTS

Rs. in lakhs

Details	Year ended 31.03.2019	Year ended 31.03.2018
Revenue from Operations	2,85,413.56	2,61,384.81
Other Operating income	7,247.53	4,652.78
Total revenue from operations	2,92,661.09	2,66,037.59
Profit before interest, depreciation and tax	48,235.10	44,513.85
Finance costs	Nil	161.74
Depreciation	7,143.69	6,173.69
Profit before tax	41,091.41	38,178.42
Provision for taxation (including deferred tax and tax relating to earlier years)	12,874.48	10,895.79
Profit after tax	28,216.93	27,282.63
Other Comprehensive Income / (Loss) for the year net of tax	(197.96)	(73.52)
Total Comprehensive Income for the year Net of Tax	28,018.97	27,209.11

2. DIVIDEND

The board of directors has recommended a dividend of (Rs.9/- per share) for the year ended 31^st March 2019 absorbing a sum of Rs.1,707.08/- Lakhs (excluding dividend tax) for approval of the shareholders at the ensuing annual general meeting.

3. PERFORMANCE

During the year 2018-19, sales of medium and heavy commercial vehicles (M & HCV) grew by 11.4% over the previous year. The Company achieved total income of Rs.2927 crores as against Rs.2660 crores in the previous year, an increase of 10%.

4. AGREEMENT FOR ACQUISITION OF WABCO HOLDINGS Inc.

On 28^th March 2019, WABCO Holdings Inc., US the ultimate parent company of WABCO India Ltd., had announced to the New York stock exchange through a press release that it has entered into a definitive merger agreement with ZF Friedrichshafen AG (“ZF”), a privately held global leader in driveline and chassis technologies.

Under the agreement, ZF will acquire all outstanding shares of WABCO Holdings Inc., US for Rs. 136.50 per share in an all-cash transaction for an equity value of over Rs. 7 billion.

The transaction, once consummated, will bring together two global technology leaders with highly complementary and innovative technology offerings to address future serving OEMs and fleets in the automotive and commercial vehicle industry, combining WABCO’s capabilities in commercial vehicle safety and efficiency, including technologies involved in vehicle dynamics control, active air suspension systems, and fleet management systems with ZF’s leading position in driveline and chassis technologies for cars and commercial vehicles. The transaction, which has been unanimously approved by the Board of Directors of WABCO Holdings Inc., US, is expected to close in early 2020 subject to approval by the shareholders, customary closing conditions, and regulatory approvals.

The said transaction, will result in the indirect acquisition by ZF of WABCO Asia Private Limited, an indirect subsidiary of WABCO Holdings Inc., US and holds 75% of the voting share capital of WABCO India Ltd. Accordingly, upon the completion of the said transaction, ZF will be entitled through WABCO Asia Private Limited to

(a) indirectly exercise 75% of the voting share capital

(b) indirectly exercise control over WABCO India Limited.

Hence, under Regulations 3(1), 4 and 5(1) of the SEBI (SAST) Regulations, a public announcement of an open offer for the acquisition of up to 47,41,900 fully paid-up equity shares of face value of Rs. 5/each of WABCO India Limited, representing 25% of the total voting equity capital of WABCO India Limited, comprising fully of public shareholders was given by ZF Friedrichshafen AG on 2^nd April 2019 at Rs. 6,318/- per share. This public announcement excluded the promoters / promoter group of WABCO India Limited.

5. CAPITAL EXPENDITURE

Capital expenditure of Rs. 117.84 crores was incurred during the year 2018-19 as against the plan of Rs. 125.50 Crores and Capital Expenditure of Rs. 119.7 Crores is planned for the year 2019-20.

6. DIRECTORS

Mr. M Lakshminarayan and Mr. Narayan K Seshadri were appointed as Independent Directors at the Annual General Meeting held on 22^nd July 2014 for a term of five consecutive years from 1^st April 2014 upto 31^st March 2019. They are eligible to be re-appointed for another term of 5 consecutive years. On recommendation of the Nomination &Remuneration Committee, the Board had after satisfying their independence criterion at their meeting held on 29^th January 2019 have reappointed Mr. M Lakshminarayan for a term of five consecutive years from 1^st April 2019 upto 31^st March 2024 and Mr. Narayan K Seshadri for a term of one year from 1^st April 2019 upto 31^st March 2020 subject to the approval of shareholders at the ensuing Annual General Meeting.

Dr. Christian Brenneke and Mr. Philippe Colpron have been appointed as Additional Directors in terms of Section 161 of Companies act 2013 at the Board Meeting held on 29^th of January 2019, who will hold office upto the ensuing Annual General Meeting. They being eligible and willing to be re-appointed as directors at the ensuing Annual General Meeting have offered themselves for re-appointment.

Mr. Jorge Solis and Mr. Shivram Narayanaswami have resigned from the Board with effect from 29^th January 2019 due to their other commitments. Your Board of Directors places on record their appreciation for services rendered by Mr. Jorge Solis and Mr. Shivram Narayanaswami during their tenure as Directors of the Company.

Mr. Sean Ernest Deason retires by rotation at the ensuing Annual General Meeting of the Company, being eligible and willing offers himself for re-appointment.

Mr. P Kaniappan was appointed as the Managing Director at the Annual General Meeting held on 22^nd July 2014 for a term of five years with effect from 17^th June 2014 upto 16^th June 2019. Based on the recommendation of the Nomination & Remuneration Committee, the Board had on 7^th May 2019 reappointed Mr. P Kaniappan as the Managing Director for a term of five years from 17^th June 2019 upto 16^th June 2024 subject to the approval of shareholders at the ensuing Annual General Meeting.

In compliance with Regulation 36(3) of the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulation), a brief resume and other required information about the directors who are being re-appointed are given in the notice convening the Annual General Meeting of the Company.

The Independent Directors continue to fulfill the criteria of independence as defined under Section 149(6) of the Companies Act, 2013 (“the Act”) and Regulation 16(b) of the Listing Regulation and have furnished the requisite declarations in this regard.

7. AUDITORS

M/s. S R Batliboi & Associates LLP, Chartered Accountants were appointed as Statutory Auditors of the Company by the shareholders for a term of five years from the 10^th Annual General Meeting upto the conclusion of the 15^th Annual General Meeting in terms of Section 139 of the Companies Act, 2013. M/s. S R Batliboi & Associates LLP would retire at the conclusion of the forthcoming 15^th Annual General Meeting and they do not seek reappointment. Your Board of Directors places on record their appreciation for the services rendered by M/s. S R Batliboi & Associates LLP, Chartered Accountants as the Statutory Auditors of the Company.

In view of the mandatory requirement, your directors have recommended appointment of M/s B S R & Co., Chartered Accountants, 5^th Floor, LodhaExelus, Apollo Mills Compound, N.M. Joshi Marg, Mahalakshmi, Mumbai - 400011 holding Firm Registration No 101248W / W-100022 as Statutory Auditors of the Company at the Board Meeting held on 25^th May 2019, for a period of 5 (five) consecutive years from conclusion of 15th annual general meeting upto the conclusion of the 20^th Annual General Meeting, subject to approval of the shareholders at the ensuing Annual General Meeting.

8. SECRETARIAL AUDITOR

M/s. S Krishnamurthy & Co., Company Secretaries have carried out Secretarial Audit under the provisions of Section 204 of the Act, for the financial year 2018-19 and submitted their report, which is annexed to this report. The report does not contain any qualification.

The Board confirms compliance with the Secretarial Standards notified by the Institute of Company Secretaries of India, New Delhi.

9. COST AUDITOR

Mr. A.N. Raman was appointed as the cost auditor for the year 2018-19. Pursuant to Section 148 of the Act, the Board of Directors of the Company upon recommendation made by the audit committee has appointed M/s A N Raman & Associates, Cost Accountants, as Cost Auditor of the Company for the financial year 2019-20 and has recommended the remuneration to the shareholders for approval at the ensuing Annual General Meeting.

10. KEY MANAGERIAL PERSONNEL

Mr. P Kaniappan - Managing Director

Mr. R S Rajagopal Sastry - Chief Financial Officer

Mr. M C Gokul - Company Secretary

11. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The Company has not provided any Loans or Guarantees to any person or other body corporate under Section 186 of the Act and the details of investments made are given in the notes to the Financial Statements.

12. ANNUAL EVALUATION OF THE BOARD’S PERFORMANCE

During the year, the Board adopted a formal mechanism for evaluating its performance and as well as that of its Committees and directors, including the Chairman of the Board as per the requirements in this regard specified in the guidance note issued by the Securities Exchange Board of India and the provisions of the Companies Act, 2013. The exercise was carried out through a structured evaluation process covering various aspects of the functioning of the Board and Committees such as their composition, experience & competencies, performance of specific duties & obligations, governance issues etc. Separate exercise was carried out to evaluate the performance of each individual director including the Chairman who were evaluated on parameters such as attendance, contribution at the meetings, independent judgment and other relevant aspects as laid down under the Guidance note issued by SEBI in this regard.

The Board was satisfied with the evaluation results, which reflected the overall engagement of the Board, Committees and the directors with the Company.

13. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has established a vigil mechanism through “WABCO Whistle Blower Policy” to enable employees and directors to report genuine concerns dealing with instances of fraud and mismanagement, if any. The mechanism provides for adequate safeguards against victimization of the whistle blower and also provides for direct access to the Chairman of the audit committee in appropriate or exceptional cases or chief ethics officer of the Company as the case may be to report any concerns or unethical activities.

14. BUSINESS RESPONSIBILITY

The Company is one among the top 500 listed companies as per the market cap as on 31^st March 2019 and hence as per the Listing regulation a Business Responsibility Report forms part of the annual report. In this regard, the Company has developed a Business Responsibility policy which is approved by the Board. As per this policy Mr. P Kaniappan, Managing Director is responsible for the implementation of the Business Responsibility initiatives. The initiatives of the Company in this regard for the year 2018-19 are provided in the Business Responsibility Report.

15. STATUTORY STATEMENTS

15.1 Conservation of energy, Research & Development Expenses and foreign exchange earnings and outgo

Information regarding conservation of energy, research & development expenses and foreign exchange earnings and outgo is given in Annexure 1 to this report, as per the requirements of Section 134(3)(m) of the Act, 2013.

15.2 Corporate Social Responsibility

The Company focuses on CSR Activities as specified in scheduled VII of the Companies Act, 2013 and the Companies CSR Policy. As required under Section 134(3)(o) of the Act, details about the policy developed and implemented by the Company on Corporate Social Responsibility initiatives taken during the year ended 31^st March, 2019 are given in Annexure 2 to this report.

15.3 Directors’ Responsibility Statement

Pursuant to Section 134(3)(c) of the Act, it is hereby confirmed that;

a. In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures.

b. The directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31^st March, 2019 and of the profit of the Company for the year ended on that date;

c. That directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. The directors had prepared the annual accounts on a going concern basis;

e. The directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

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

16. DISCLOSURES UNDER COMPANIES ACT, 2013

16.1 Extract of the Annual Return

Details of extracts of the annual return as per Form MGT - 9 is enclosed in Annexure 3 to the Directors report.

16.2 Number of Board Meetings

The Board of Directors met five times during the year 2018-19. The details of the Board meetings and the attendance of the Directors are provided in the Corporate Governance Report.

16.3 Committees of Board of Directors

Details of memberships and attendance of various committee meetings are given in Corporate Governance Report.

16.4 Related Party Transactions

All related party transactions that were entered into during the financial year were on an arm’s length basis and were in the ordinary course of business. There are no related party transactions made by the company with promotors, Directors, Key Managerial Personnel or other designed persons which may have a potential conflict with the interest of the company at large.

Certain related party transactions entered into during the year ended 31^st March 2019 and transactions proposed to be entered into during the year ending 31^st March 2020 between the Company and WABCO Europe BVBA, which is fellow subsidiary of the Company, are material in nature and require the approval of members by ordinary resolution as per the Listing regulation. An ordinary resolution seeking shareholders approval is included in the notice to shareholders.

The Company pays royalty to M/s WABCO Europe BVBA a fellow subsidiary and related party at the rate of 4% per annum on the net sales (Total sales (less) intercompany sales (less) intercompany purchases) effective 1^st January 2016 for the intellectual property, knowhow and processes supplied by WABCO Europe BVBA. M/s WABCO Europe BVBA charges Royalty to all its associated entities in line with the global practices and transfer pricing norms.

All transactions with related parties are placed before the audit committee and prior approval of the audit committee is obtained. The Company has in place a Related Party Transactions Policy for the purpose of identification and monitoring of such transactions. Details of material Related Party Transactions entered by the company as required under Section 134(3)(h) of the Act and the Listing regulation are given in annexure 4 to this report.

17. POLICIES

17.1 The following policies approved by the Board of Directors of the Company were uploaded and are available in the Company’s website at the web link: http://www.wabco-auto.com/en/investor_relations/wabco_india_investor_relations

- Corporate Social Responsibility Policy

- Related Party Transaction Policy

- Nomination and Remuneration Policy

- Whistle Blower Policy

- Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information

- Policy on Criteria for Determining Materiality of Events

- Dividend Policy

17.2 Policy on director appointment and remuneration Company’s policy on directors’ appointment and remuneration including criteria determining for qualification, positive attributes, independence of a director and other matters provided under Section 178(3) of the Act is provided in the Corporate Governance Report.

18. PARTICULARS OF DISCLOSURES AS REQUIRED UNDER SECTION 197 OF THE COMPANIES ACT, 2013

18.1 The ratio of the remuneration of each director to the median employee’s remuneration for the financial year and such other details as prescribed are as given below:

Name	Ratio
Mr. P. Kaniappan, Managing Director	29.27:1
Mr. M. Lakshmi Narayan, Independent Director	2.28:1
Mr. Narayan Seshadri, Independent Director	2.06:1
Dr. Lakshmi Venu, Independent Director	2.16:1

Directors other than those mentioned above have not drawn any remuneration for the financial year 2018-19.

18.2 The percentage increase in remuneration of each Director, Managing Director, Chief Financial Officer, Company Secretary, in the financial year:

Mr. M. Lakshminarayan, Chairman	15.28%
Mr. Narayan K Seshadri, Director	14.63%
Dr. Lakshmi Venu	15.38%
Mr. P. Kaniappan, Managing Director	15.02%
Mr. R.S Rajagopal Sastry, Chief Financial Officer	21.61%
Mr. M.C Gokul, Company Secretary	11.52%

18.3 The percentage increase in the median remuneration of employees in the financial year: 12%

18.4 The number of permanent employees on the rolls of company as on 31^st March 2019 : 1778

18.5 Average percentage increase already made in the salaries of employees other than the managerial personnel in the last financial year: 7.1%

Percentage increase in the managerial remuneration in the last financial year was 16.1%. There are no exceptional circumstances for increase in the managerial remuneration. With respect to the Managerial Personnel, variable component is paid in the form of incentive, as per the remuneration policy of the Company and based on the financial and non-financial parameters based on their individual performance and the performance of the Company.

18.6 The key parameters for any variable component of remuneration availed by the directors: Independent directors have been paid sitting fees for attending meetings of the Board and Committees and also paid a profit related commission, but not exceeding 1% of the net profit of the Company for the financial year. No sitting fee and commission is paid to non-executive and non-independent Directors of the Company. However, with respect to Mr. P. Kaniappan, Managing Director, variable component is paid in the form of incentive, as per the Remuneration Policy of the Company and based on the financial and non-financial parameters.

18.7 The remuneration of directors and employees are as per the remuneration policy of the company.

18.8 Particulars of Employees

The statement of particulars of employees as per Section 197 of the Companies Act, 2013, read with Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014, for the year ended 31^st March, 2019, is given in annexure 5 and forms part of this Report.

19. CORPORATE GOVERNANCE

The Company has complied with the provisions of the Listing Regulations concerning corporate governance and a report to this effect is attached, as required by Under Schedule V of the Listing Regulation. The certificate issued by the auditors of the Company regarding compliance with the corporate governance requirements is also annexed to this report. The Managing Director, (CEO) and the Chief Financial Officer (CFO) of the Company have certified to the board on financial statements and other matters in accordance with Regulation 17(8) of the Listing Regulations pertaining to CEO / CFO certification for the financial year ended 31^st March 2019. Further, applicable Secretarial Standard have been complied with.

The management discussion and analysis report, as required by the Listing Regulation and various disclosures required under the Act is also attached and forms part of this report.

20. FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

The Company has a structured familiarization program for independent Directors of the Company which also extends to other Non-Executive Directors to ensure that Directors are familiarized with their function, role, rights, responsibilities and the nature of the Company Business viz., automotive component industry and WABCO global business model, etc.

The Board of Directors has complete access to the information within the Company. Presentations are regularly made to the Board of Directors and all Committees of the Board on various matters, where Directors get an opportunity to interact with Senior Management. Presentations, inter alia, cover the Company’s strategy, business model, operations, markets, organization structure, product offerings, finance, risk management framework, quarterly and annual results, human resources, technology, quality and such other areas as may arise from time to time.

The Company also issues appointment letters to the Independent Directors which also incorporates their role, duties and responsibilities. Further, updates on regulatory changes are also periodically placed before the Board. The details of familiarisation have been hosted in the web site of the Company under the web link http://wabco-auto.com/investor-relations/wabco-india-investor-relations

Acknowledgement

The directors thank the vehicle manufacturers, distributors, vendors and bankers for their continued support and assistance. The directors gratefully acknowledge the support rendered by WABCO Europe BVBA. The directors wish to place on record their appreciation of the excellent work done by employees of the Company at all levels during the year. The directors specially thank the shareholders for the confidence reposed by them in the Company.

For and on behalf of the board

P KANIAPPAN NARAYAN K SESHADRI

Managing Director Director

Chennai 25^th May 2019

---

Mar 31, 2018

Directors’ report to the shareholders

The directors have pleasure in presenting the fourteenth annual report and the audited financial statements for the financial year ended 31^st March 2018.

1. FINANCIAL HIGHLIGHTS

Rs, in lakhs

Details	Year ended 31.03.2018	Year ended 31.03.2017
Revenue from Operations	260,941.67	226,057.16
Other Operating income	5,095.92	3,615.07
Total revenue from operations	266,037.59	229,672.23
Profit before interest, depreciation and tax	44,513.85	36,254.52
Finance costs	161.74	46.44
Depreciation	6,173.69	6,162.93
Profit before tax	38,178.42	30,045.15
Provision for taxation (including deferred tax and tax relating to earlier years)	10,895.79	8,697.38
Profit after tax	27,282.63	21,347.77
Other Comprehensive Income / (Loss) for the year net of tax	(73.52)	(352.93)
Total Comprehensive Income for the year net of Tax	27,209.11	20,994.84

2. DIVIDEND

The board of directors has recommended a dividend of (Rs, 8/- per share) for the year ended 31^st March 2018 absorbing a sum of Rs, 1,517.41/- lakhs, (excluding dividend tax) for approval of the shareholders at the ensuing annual general meeting.

3. PERFORMANCE

During the year 2017-18, sales of medium and heavy commercial vehicles (M&HCV) grew by 11% over the previous year. The Company achieved total revenue from operations and other income of Rs, 2,660.38 crores as against Rs, 2,296.72 crores in the previous year, an increase of 15.8%.

4. CAPITAL EXPENDITURE

Capital expenditure of Rs, 103.07 crores was incurred during the year 2017-18 as against the plan of Rs, 101.95 Crores and Capital Expenditure of Rs, 110 Crore is planned for the year 2018-19.

5. DIRECTORS

Ms. Lisa J Brown (DIN 07053317) retires by rotation at the ensuing annual general meeting of the Company, being eligible, offers herself for re-appointment.

In compliance with Regulation 36(3) of the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulation), a brief resume and other required information about the director who is being re-appointed is given in the notice convening the Annual General Meeting of the Company.

The independent directors continue to fulfill the criteria of independence as defined under Section 149(6) of the Companies Act, 2013 ("the Act") and Regulation 16(b) of the Listing Regulation and have furnished the requisite declarations in this regard.

6. AUDITORS

Messrs S.R. Batliboi & Associates LLP, Chartered Accountants, Chennai (Firm Registration No.101049W) were appointed as Statutory Auditors at the Annual General Meeting held on 22^nd July 2014 for a period of 5 (five) years from conclusion of 10^th annual general meeting upto the conclusion of the 15^th Annual General Meeting, subject to ratification by members at every annual general meeting. Section 40 of the Companies Amendment Act, 2017 notified on 7^th May 2018 has omitted the first provision to Section 139(1) of the Companies Act, 2013 whereby the requirement of ratification by members at every annual general meeting has been done away with. Hence Messrs S. R. Batliboi & Associates LLP, Chartered Accountants, Chennai, being eligible would continue as Statutory Auditors till their term up to the 15^th Annual General Meeting.

7. SECRETARIAL AUDITOR

M/s. S Krishnamurthy & Co., Company Secretaries have carried out Secretarial Audit under the provisions of Section 204 of the Act, for the financial year 2017-18 and submitted their report, which is annexed to this report. The report does not contain any qualification.

8. COST AUDITOR

Mr. A N Raman was appointed as the cost auditor for the year 2017-18. Pursuant to Section 148 of the Act, the Board of Directors of the Company upon recommendation made by the audit committee has appointed Mr. A N Raman, Cost Accountant, as Cost Auditor of the Company for the financial year 2018-19 and has recommended his remuneration to the shareholders at the ensuing Annual General Meeting.

9. KEY MANAGERIAL PERSONNEL

Mr. P Kaniappan - Managing Director

Mr. R S Rajagopal Sastry - Chief Financial Officer

Mr. M C Gokul - Company Secretary

10. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The Company has not provided any Loans or Guarantees to any person or other body corporate under Section 186 of the Act and the details of investments made are given in the notes to the Financial Statements.

11. EVALUATION OF THE BOARD''S PERFORMANCE

During the year, the Board adopted a formal mechanism for evaluating its performance and as well as that of its Committees and directors, including the Chairman of the Board as per the requirements in this regard specified in the guidance note issued by the Securities Exchange Board of India and the provisions of the Companies Act, 2013. The exercise was carried out through a structured evaluation process covering various aspects of the functioning of the Board and Committees such as their composition, experience & competencies, performance of specific duties & obligations, governance issues etc. Separate exercise was carried out to evaluate the performance of each individual director including the Board Chairman who were evaluated on parameters such as attendance, contribution at the meetings, independent judgment and other relevant aspects as laid down under the Guidance note issued by SEBI in this regard.

The Board was satisfied with the evaluation results, which reflected the overall engagement of the Board, Committees and the directors with the Company.

12. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has established a vigil mechanism through "WABCO Whistle Blower Policy" to enable employees and directors to report genuine concerns dealing with instances of fraud and mismanagement, if any. The mechanism provides for adequate safeguards against victimization of the whistle blower and also provides for direct access to the Chairman of the audit committee in appropriate or exceptional cases or to the chief ethics officer of the Company as the case may be to report any concerns or unethical activities.

13. BUSINESS RESPONSIBILITY

The Company is one among the top 500 listed companies as per the market cap as on 31^st March 2018 and hence as per the Listing regulation requires a Business Responsibility Report forms part of the annual report. In this regard, the Company has developed a Business Responsibility policy which is approved by the Board. As per this policy Mr. P Kaniappan, Managing Director is responsible for the implementation of the Business Responsibility initiatives. The initiatives of the Company in this regard for the year 2017-18 are provided in the Business Responsibility Report.

14. STATUTORY STATEMENTS

14.1 Conservation of energy, Research & Development Expenses and foreign exchange earnings and outgo

Information regarding conservation of energy, Research & Development expenses and foreign exchange earnings and outgo is given in Annexure 1 to this report, as per the requirements of Section 134(3)(m) of the Act, 2013.

14.2 Corporate Social Responsibility

The Company focuses on CSR Activities as specified in scheduled VII of the Companies Act, 2013 and the Companies CSR Policies. As required under Section 134(3)(o) of the Act, details about policy developed and implemented by the Company on Corporate Social Responsibility initiatives taken during the year ended 31^st March, 2018 are given in Annexure 2 to this report.

14.3 Directors'' Responsibility Statement

Pursuant to Section 134(3)(c) of the Act, it is hereby confirmed that;

a. in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures.

b. the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31^st March, 2018 and of the profit of the Company for the year ended on that date;

c. that directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. the directors had prepared the annual accounts on a going concern basis;

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

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

15. DISCLOSURES UNDER COMPANIES ACT, 2013

15.1 Extract of the Annual Return

Details of extracts of the annual return as per Form MGT - 9 is enclosed in Annexure 3 to the Directors report.

15.2 Number of Board Meetings

The Board of Directors met four times during the year 2017-18. The details of the Board meetings and the attendance of the Directors are provided in the Corporate Governance Report.

15.3 Committees of Board of Directors

Details of memberships and attendance of various committee meetings are given in Corporate Governance Report.

15.4 Related Party Transactions

All related party transactions that were entered into during the financial year were on an arm''s length basis and were in the ordinary course of business. There are no related party transactions made by the company with promoters, Directors, Key Managerial Personnel or other designed persons which may have a potential conflict with the interest of the company at large.

Certain related party transactions entered into during the year ended 31^st March 2018 and transactions proposed to be entered into during the year ending 31^st March 2019 between the Company and WABCO Europe BVBA, which is fellow subsidiary of the company, are material in nature and require the approval of members by ordinary resolution as per the Listing regulation. An ordinary resolution seeking shareholders'' approval is included in the notice to shareholders.

All transactions with related parties are placed before the audit committee and prior approval of the audit committee is obtained. The Company has developed a Related Party Transactions Policy for the purpose of identification and monitoring of such transactions. Details of material Related Party Transactions entered by the company as required under Section 134(3)(h) of the Act and the Listing regulation are given in annexure 4 to this report.

16. POLICIES

16.1 The following policies approved by the Board of Directors of the Company were uploaded and are available in the Company''s website at the web link: http://www.wabco-auto.com/en/investor_relations/wabco_india_investor_ relations

- Corporate Social Responsibility Policy

- Related Party Transaction Policy

- Nomination and Remuneration Policy

- Whistle Blower Policy

- Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information

- Policy on Criteria for Determining Materiality of Events

- Dividend Policy

16.2 Policy on director appointment and remuneration Company''s policy on directors'' appointment and remuneration including criteria determining for qualification, positive attributes, independence of a director and other matters provided under Section 178(3) of the Act is provided in the Corporate Governance Report.

17. PARTICULARS OF DISCLOSURES AS REQUIRED UNDER SECTION 197 OF THE COMPANIES ACT, 2013

17.1 The ratio of the remuneration of each director to the median employee''s remuneration for the financial year and such other details as prescribed are as given below:

Name	Ratio
Mr. P. Kaniappan, Managing Director	25.66:1
Mr. M. Lakshmi Narayan, Independent Director	2.22:1
Mr. Narayan Seshadri, Independent Director	2.16:1
Dr. Lakshmi Venu, Independent Director	2.00:1

Directors other than those mentioned above have not drawn any remuneration for the financial year 2017-18.

17.2 The percentage increase in remuneration of each Director, Managing Director, Chief Financial Officer, Company Secretary, in the financial year:

Mr. M. Lakshminarayan, Chairman	14.29%
Mr. Narayan K Seshadri, Director	12.86%
Dr. Lakshmi Venu*	35.42%
Mr. P. Kaniappan, Managing Director	29.74%
Mr. R.S Rajagopal Sastry,
Chief Financial Officer	23.34%
Mr. M.C Gokul, Company Secretary	23.75%

* In office for part of the year 2016-17 and hence the commission was paid prorata.

17.3 The percentage increase in the median remuneration of employees in the financial year: 6.29%

17.4 The number of permanent employees on the rolls of company as on 31^st March 2018: 1673

17.5 Average percentage increase already made in the salaries of employees other than the managerial personnel in the last financial year: 14.5%

Percentage increase in the managerial remuneration in the last financial year was 27.9%. There are no exceptional circumstances for increase in the managerial remuneration. With respect to the Managerial Personnel, variable component is paid in the form of incentive, as per the remuneration policy of the Company and based on the financial and non-financial parameters based on their individual performance and the performance of the Company.

17.6 The key parameters for any variable component of remuneration availed by the directors: Independent directors have been paid sitting fees for attending meetings of the Board and Committees and also paid a profit related commission, but not exceeding 1% of the net profit of the Company for the financial year. No sitting fee and commission is paid to non-executive and non-independent Directors of the Company. However, with respect to Mr. P. Kaniappan, Managing Director of the Company variable component is paid in the form of performance based incentive, as per the Remuneration Policy of the Company and based on the financial and non-financial parameters.

17.7 The remuneration of directors and employees are as per the remuneration policy of the company.

17.8 Particulars of Employees

The statement of particulars of employees as per Section 197 of the Companies Act, 2013, read with Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014, for the year ended 31^st March, 2018, is given in annexure 5 and forms part of this Report.

18. CORPORATE GOVERNANCE

The Company has complied with the provisions of the Listing Regulations concerning corporate governance and a report to this effect is attached, as required by Under Schedule V of the Listing Regulation. The certificate issued by the auditors of the Company regarding compliance with the corporate governance requirements is also annexed to this report. The Managing Director, (CEO) and the Chief Financial Officer (CFO) of the Company have certified to the board on financial statements and other matters in accordance with Regulation 17(8) of the Listing Regulations pertaining to CEO / CFO certification for the financial year ended 31^st March 2018. Further, applicable Secretarial Standard have been complied with.

The management discussion and analysis report, as required by the Listing Regulation and various disclosures required under the Act is also attached and forms part of this report.

19. FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

The Company has a structured familiarization program for independent Directors of the Company which also extends to other Non-Executive Directors to ensure that Directors are familiarized with their function, role, rights, responsibilities and the nature of the company Business viz., automotive component industry and WABCO global business model, etc.

The Board of Directors has complete access to the information within the Company. Presentations are regularly made to the Board of Directors and all Committees of the Board on various matters, where Directors get an opportunity to interact with Senior Management. Presentations, inter alia, cover the Company''s strategy, business model, operations, markets, organization structure, product offerings, finance, risk management framework, quarterly and annual results, human resources, technology, quality and such other areas as may arise from time to time.

The Company also issues appointment letters to the Independent Directors which also incorporates their role, duties and responsibilities. Further, regulatory updates on regulatory changes are also periodically placed before the Board.

Acknowledgement

The directors thank the vehicle manufacturers, distributors, vendors and bankers for their continued support and assistance. The directors gratefully acknowledge the support rendered by WABCO Europe BVBA, Belgium. The directors wish to place on record their appreciation of the excellent work done by employees of the Company at all levels during the year. The directors specially thank the shareholders for the confidence reposed by them in the Company.

For and on behalf of the board

Chennai M. LAKSHMINARAYAN

28^th May 2018 Chairman

---

Mar 31, 2017

The directors have pleasure in presenting the thirteenth annual report and the audited financial statements for the financial year ended 31^st March 2017.

1. FINANCIAL HIGHLIGHTS

Rs. in lakhs

Details	Year ended 31.03.2017	Year ended 31.03.2016
Revenue from Operations	226,057.16	199,953.84
Other Operating Income	3,615.07	4,012.32
Total revenue from operations	229,672.23	203,966.16
Gross profit before interest and depreciation	36,254.52	32,669.54
Finance costs	46.44	15.20
Depreciation	6,162.93	5,620.13
Profit before tax	30,045.15	27,034.21
Provision for taxation (including deferred tax and tax relating to earlier years)	8,697.38	6,697.21
Profit after tax	21,347.77	20,337.00
Other Comprehensive Income / (Loss) for the year net of tax	(352.93)	(62.20)
Total Comprehensive Income for the year net of tax	20,994.84	20,274.80

2. DIVIDEND

The board of directors has recommended a dividend of (Rs.7 per share) for the year ended 31^st March 2017 absorbing a sum of Rs.1,327.73 /- lakhs (excluding dividend tax) for approval of the shareholders at the ensuing annual general meeting.

3. PERFORMANCE

During the year 2016-17, sales of medium and heavy commercial vehicles (M & HCV) grew by 0.42% over the previous year. The Company achieved total revenue from operations and other income of Rs.2,296.72 crores as against Rs.2,039.66 crores in the previous year, an increase of 12.6%.

4. CAPITAL EXPENDITURE

Capital expenditure of Rs.73.91 crores was incurred during the year 2016-17 as against the plan of Rs.90 Crores and Capital Expenditure of Rs. 90 Crore is planned for the year 2017-18.

5. DIRECTORS

Dr. Lakshmi Venu (DIN: 02702020) has been appointed as an Independent Director by the Board with effect from 19^th May 2016 which was approved by the shareholders at the annual general meeting dated 29^th July 2016.

Mr. Jorge Solis retires by rotation at the ensuing annual general meeting of the Company, being eligible, offers himself for reappointment.

In compliance with Regulation 36(3) of the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulation), a brief resume and other required information about the directors who are being reappointed are given in the notice convening the annual general meeting of the Company.

The independent directors continue to fulfill the criteria of independence as defined under Section 149(6) of the Companies Act, 2013 (“the Act”) and Regulation 16(b) of the Listing Regulation and have furnished the requisite declarations in this regard.

6. AUDITORS

Messrs S. R. Batliboi & Associates LLP, Chartered Accountants, Chennai (Firm Registration No. 101049W) were appointed as Statutory Auditors at the Annual General Meeting held on 22^nd July 2014 for a period of 5 (five) years from conclusion of 10th annual general meeting upto the conclusion of the 15^th Annual General Meeting, subject to ratification by members at every annual general meeting. The Board recommends the ratification to enable their continuation as Auditors. The Company has received a confirmation from the Statutory Auditors to the effect that they would be eligible for such continuation.

7. SECRETARIAL AUDITOR

M/s. S Krishnamurthy & Co., Company Secretaries have carried out Secretarial Audit under the provisions of Section 204 of the Act, for the financial year 2016-17 and submitted their report, which is annexed to this report. The report does not contain any qualification.

8. COST AUDITOR

Pursuant to Section 148 of the Act, the Board of Directors of the Company upon recommendation made by the audit committee has appointed Mr. A.N Raman, Cost Accountant, as Cost Auditor of the Company for the financial year 2017-18 and has recommended his remuneration to the shareholders at the ensuing Annual General Meeting.

9. KEY MANAGERIAL PERSONNEL

Mr. P Kaniappan - Managing Director

Mr. R S Rajagopal Sastry - Chief Financial Officer

Mr. M C Gokul - Company Secretary

10. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The Company has not provided any Loans or Guarantees to any person or other body corporate under Section 186 of the Act and the details of investments made are given in the notes to the Financial Statements.

11. EVALUATION OF THE BOARD’S PERFORMANCE

During the year, the Board adopted a formal mechanism for evaluating its performance and as well as that of its Committees and directors, including the Chairman of the Board as per the requirements in this regard specified in the guidance note issued by the Securities Exchange Board of India and the provisions of the Companies Act, 2013. The exercise was carried out through a structured evaluation process covering various aspects of the functioning of the Board and Committees such as their composition, experience & competencies, performance of specific duties & obligations, governance issues etc. Separate exercise was carried out to evaluate the performance of each individual director including the Board Chairman who were evaluated on parameters such as attendance, contribution at the meetings, independent judgment and other relevant aspects.

The Board was satisfied with the evaluation results, which reflected the overall engagement of the Board, Committees and the directors with the Company.

12. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has established a vigil mechanism through “WABCO Whistle Blower Policy” to enable employees and directors to report genuine concerns dealing with instances of fraud and mismanagement, if any. The mechanism provides for adequate safeguards against victimization of the whistle blower and also provides for direct access to the Chairman of the audit committee in appropriate or exceptional cases or chief ethics officer of the Company as the case may be to report any concerns or unethical activities.

13. BUSINESS RESPONSIBILITY

The Company is one among the top 500 listed companies as per the market cap as on 31^st March 2016 and hence as per the Listing regulation the Business Responsibility Report forms part of the annual report commencing from this year. In this regard, the Company has developed a Business Responsibility policy which is approved by the Board. As per this policy Mr. P Kaniappan, Managing Director is responsible for the implementation of the Business Responsibility initiatives. The initiatives of the Company in this regard for the year 2016-17 are provided in the Business responsibility report.

14. STATUTORY STATEMENTS

14.1 Conservation of energy Research & Development Expenses and foreign exchange earnings and outgo

Information regarding conservation of energy, Research & Development expenses and foreign exchange earnings and outgo is given in Annexure 1 to this report, as per the requirements of Section 134(3)(m) of the Act, 2013.

14.2 Corporate Social Responsibility

The Company focuses on CSR activities as specified in Schedule VII of the Companies Act, 2013 and the Companies CSR policy. As required under Section 134(3)(o) of the Act, details about policy developed and implemented by the Company on Corporate Social Responsibility initiatives taken during the year ended 31^st March, 2017 are given in Annexure 2 to this report

14.3 Directors’ Responsibility Statement

Pursuant to Section 134(3)(c) of the Act, it is hereby confirmed that;

a. in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures.

b. the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31^st March, 2017 and of the profit of the Company for the year ended on that date;

c. that directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. the directors had prepared the annual accounts on a going concern basis;

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

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

15. DISCLOSURES UNDER COMPANIES ACT, 2013

15.1 Extract of the Annual Return

Details of extracts of the annual return as per Form MGT - 9 is enclosed in Annexure 3 to the Directors’ Report.

15.2 Number of Board Meetings

The Board of Directors met five times during the year 2016-17. The details of the Board meetings and the attendance of the Directors are provided in the Corporate Governance Report.

15.3 Committees of Board of Directors

Details of memberships and attendance of various committee meetings are given in Corporate Governance Report.

15.4 Related Party Transactions

All related party transactions that were entered into during the financial year were on an arm’s length basis and were in the ordinary course of business. There are no related party transactions made by the company with promotors, Directors, Key Managerial Personnel or other designed persons which may have a potential conflict with the interest of the Company at large.

Certain related party transactions entered into during the year ended 31^st March 2017 and transactions proposed to be entered into during the year ending 31^st March 2018 between the Company and WABCO Europe BVBA, which is fellow subsidiary of the company, are material in nature and require the approval of members by ordinary resolution as per the Listing regulation. An ordinary resolution seeking shareholders’ approval is included in the notice to shareholders.

All transactions with related parties are placed before the audit committee and prior approval of the audit committee is obtained. The Company has developed a Related Party Transactions Policy for the purpose of identification and monitoring of such transactions. Details of material Related Party Transactions entered by the company as required under Section 134(3)(h) of the Act and the Listing regulation are given in annexure 4 to this report.

16. POLICIES

16.1 The following policies approved by the Board of Directors of the Company were uploaded and are available in the Company’s website at the web link: http://www.wabco-auto.com/en/investor_relations/ wabco_india_investor_relations

Corporate Social Responsibility Policy

Related Party Transaction Policy

Nomination and Remuneration Policy

Whistle Blower Policy

Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information Policy on Criteria for Determining Materiality of Events Dividend Policy

16.2 Policy on director appointment and remuneration Company’s policy on directors’ appointment and remuneration including criteria for determining qualification, positive attributes, independence of a director and other matters provided under Section 178(3) of the Act is provided in the Corporate Governance Report.

17. PARTICULARS OF DISCLOSURES AS REQUIRED UNDER SECTION 197 OF THE COMPANIES ACT, 2013

17.1 The ratio of the remuneration of each director to the median employee’s remuneration for the financial year and such other details as prescribed are as given below:

Name	Ratio
Mr. P. Kaniappan, Managing Director	24.14:1
Mr. M. Lakshmi Narayan, Independent Director	2.06:1
Mr. Narayan Seshadri, Independent Director	2.00:1
Dr. Lakshmi Venu, Independent Director	1.57:1

Directors other than those mentioned above have not drawn any remuneration for the financial year 2016-17.

17.2 The percentage increase in remuneration of each Director, Managing Director, Chief Financial Officer, Company Secretary, in the financial year:

Mr. M. Lakshminarayan, Chairman	3.28%
Mr. Narayan K Seshadri, Director	(1.64)%
Dr. Lakshmi Venu*	N.A
Mr. P. Kaniappan, Managing Director	10.8%
Mr. R.S Rajagopal Sastry, Chief Financial Officer	1 0.0%
Mr. M.C Gokul, Company Secretary	12.0%

* In office for part of the year 2016-17 and hence percentage increase cannot be calculated.

17.3 The percentage increase in the median remuneration of employees in the financial year: 10.93%

17.4 The number of permanent employees on the rolls of Company as on 31^st March 2017 : 1573

17.5 Average percentage increase already made in the salaries of employees other than the managerial personnel in the last financial year: 9.3%

Percentage increase in the managerial remuneration in the last financial year was 10.65%. Mr. R S Rajagopal Sastry was appointed as the Chief Financial Officer and Mr. M C Gokul was appointed as the Company Secretary during the financial year 2015-16. There are no exceptional circumstances for increase in the managerial remuneration.

17.6 The key parameters for any variable component of remuneration availed by the directors: Independent directors have been paid sitting fees for attending meetings of the

Board and Committees and also paid a profit related commission, but not exceeding 1% of the net profit of the Company for the financial year. No sitting fee and commission is paid to non-executive and non-independent Directors of the Company. However, with respect to Mr. P. Kaniappan, Managing Director of the Company variable component is paid in the form of incentive, as per the Remuneration Policy of the Company and based on the financial and non-financial parameters.

17.7 The remuneration of directors and employees are as per the remuneration policy of the company.

17.8 Particulars of Employees

The statement of particulars of employees as per 197 of the Companies Act, 2013, read with Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014, for the year ended 31^st March, 2017, is given in annexure 5 and forms part of this Report.

18. CORPORATE GOVERNANCE

The Company has complied with the provisions of the Listing Regulations concerning corporate governance and a report to this effect is attached, as required by Under Schedule V of the Listing Regulation. The certificate issued by the auditors of the Company regarding compliance with the corporate governance requirements is also annexed to this report. The Managing Director, (CEO) and the Chief Financial Officer (CFO) of the Company have certified to the board on financial statements and other matters in accordance with Regulation 17(8) of the Listing Regulations pertaining to CEO / CFO certification for the financial year ended 31^st March 2017.

The management discussion and analysis report, as required by the Listing Regulation and various disclosures required under the Act is also attached and forms part of this report.

19. FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

The Company has a structured familiarization program for independent Directors of the Company which also extends to other Non-Executive Directors to ensure that Directors are familiarized with their function, role, rights, responsibilities and the nature of the company Business viz., automotive component industry and WABCO global business model, etc.

The Board of Directors has complete access to the information within the Company. Presentations are regularly made to the Board of Directors and all Committees of the Board on various matters, where Directors get an opportunity to interact with Senior Management. Presentations, inter alia, cover the Company’s strategy, business model, operations, markets, organization structure, product offerings, finance, risk management framework, quarterly and annual results, human resources, technology, quality and such other areas as may arise from time to time.

The Company also issues appointment letters to the Independent Directors which also incorporates their role, duties and responsibilities. Further, regulatory updates on regulatory changes are also periodically placed before the Board.

Acknowledgement

The directors thank the vehicle manufacturers, distributors, vendors and bankers for their continued support and assistance. The directors gratefully acknowledge the support rendered by WABCO Europe BVBA, Belgium. The directors wish to place on record their appreciation of the excellent work done by employees of the Company at all levels during the year. The directors specially thank the shareholders for the confidence reposed by them in the Company.

For and on behalf of the board

Chennai M. LAKSHMINARAYAN

30^th May 2017 Chairman

---

Mar 31, 2013

The directors have pleasure in presenting the ninth annual report and the audited accounts for the financial year ended 31st March 2013.

2. FINANCIAL HIGHLIGHTS

Rs. in lakhs

Details Year ended Year ended 31.03.2013 31.03.2012

Sales (net) 91,735.78 1,00,497.08

Other Operating income 4,856.60 4,067.16

Other income 1,263.50 1,205.90

Total revenue from operations and other income 97,855.88 1,05,770.14

Gross profit before interest and depreciation 20,668.37 23,198.63

Finance costs 1.76 11.88

Depreciation 2,171.78 1,563.72

Profit before tax 18,494.83 21,623.03

Provision for taxation (including deferred tax and tax relating to earlier years) 5,416.00 6,283.07

Profit after tax 13,078.83 15,339.96

Surplus brought forward from previous year 33,241.02 22,003.29

Total 46,319.85 37,343.25

Appropriations:

Proposed dividend 948.38 948.38

Dividend tax payable 161.18 153.85

Transfer to general reserve 5,000.00 3,000.00

Surplus in profit & loss account 40,210.29 33,241.02

46,319.85 37,343.25

3. DIVIDEND

The board of directors have recommended a dividend of Rs.5 per share for the year ended 31st March 2013 absorbing a sum of Rs.948.38 lakhs for approval of the shareholders at the ensuing annual general meeting.

4. PERFORMANCE

During the year 2012-13, sales of medium and heavy commercial vehicles (MHCV), dropped by 24% over the previous year. The Company achieved a total revenue from operations and other income of Rs.978 crores as against turnover of Rs.1,057 crores in the previous year, a reduction of 7.5%.

However, after market sales segment registered a growth of 16.5% over the previous year and exports segment registered a growth of 34.2% over the previous year.

5. CAPITAL EXPENDITURE

Capital expenditure of Rs.63 crores is planned for the year 2013-14 considering the industry growth in this year.

6. DIRECTORS

Mr Leon Liu, Mr Narayan K Seshadri, and Mr Michael Edward Thompson, retire at the ensuing Annual General Meeting of the Company. Being eligible, they offer themselves for re-appointment. In compliance with clause 49 of the Listing Agreement, a brief resume of the above three directors and other required information is given in the notice convening the annual general meeting of the Company. Necessary resolutions for their reappointment will be placed for approval of the shareholders at the ensuing annual general meeting. Your directors recommend their reappointment as directors of the Company.

Mr Nikhil Madhukar Varty resigned as a director with effect from 24th July 2012. The Board of Directors at its meeting on 24th July 2012 placed on record its appreciation of the valuable services rendered by him during his tenure as a director. Mr Michael Edward Thompson was appointed as a director in the casual vacancy caused by the resignation of Mr Nikhil Madhukar Varty at the board meeting on 24th July 2012.

7. AUDITORS

Messrs S.R.Batliboi & Associates LLP, Chartered Accountants have informed that that the name of their firm Viz S.R.Batliboi & Associates, Chartered Accountants has been changed to S.R.Batliboi & Associates LLP on the conversion of the firm to limited liability partnership effective 1st April 2013. They retire at the ensuing Annual General Meeting and are eligible for re-appointment and the re-appointment will be made in the new firm name.

8. COST AUDITOR

Mr A N Raman was appointed as Cost auditor of the Company for 2012-13 by the board of directors at their meeting held on 23rd May 2012. The board at their meeting held on 15th May 2013 have re-appointed Mr A N Raman as Cost auditor for 2013-14.

9. STATUTORY STATEMENTS

Conservation of energy, technology absorption and foreign exchange earnings and outgo

Information regarding conservation of energy, technology absorption and foreign exchange earnings and outgo is given in Annexure I to this report, as per the requirements 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.

Particulars of employees

Particulars of employees pursuant to Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended, are set out in Annexure II and form part of this report. However, pursuant to Section 219(1)(b)(iv) of the Companies Act, 1956, the Report and Accounts are being sent to all the Members excluding the aforesaid information. The said particulars will be made available to a Member upon request and also made available for inspection at the Registered Office of the Company. Any Member interested in obtaining such particulars may write to the Company Secretary at the Registered Office of the Company.

Directors'' Responsibility Statement

Pursuant to Section 217(2AA) of the Companies Act, 1956 it is hereby confirmed: _

(i) that in the preparation of annual accounts for the financial year ended 31st March 2013, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(ii) that the directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year under review;

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

(iv) that the directors have prepared the accounts for the financial year ended 31st March 2013 on a going concern basis.

10. CORPORATE GOVERNANCE

The Company has complied with the provisions of the Listing Agreement concerning corporate governance and a report to this effect is attached, as required by clause 49 of the Listing Agreement with the stock exchanges. The certificate issued by the auditors of the Company regarding compliance with the corporate governance requirements is also annexed to this report.

The whole-time director (CEO) and the chief financial officer (CFO) of the Company have certified to the board on financial statements and other matters in accordance with clause 49(V) of the Listing Agreement pertaining to CEO/CFO certification for the financial year ended 31st March 2013.

The management discussion and analysis report, as required by the Listing Agreement, is also attached and forms part of this report.

Para (xxi) of the Annexure to the Auditors'' Report dated May 15, 2013 is self-explanatory. The investigation referred therein is entrusted to an external agency and the Company is wholly co-operating therewith. Also, the Company has further strengthened its internal controls to prevent such an occurrence.

11. ACKNOWLEDGEMENT

The directors gratefully acknowledge the continued support and co-operation received from WABCO Europe BVBA, Belgium. The directors thank the vehicle manufacturers, distributors, vendors and bankers for their continued support and assistance.

The directors wish to place on record their appreciation of the excellent work done by employees of the Company at all levels during the year. The directors specially thank the shareholders for the confidence reposed by them in the Company.

For and on behalf of the board

Chennai M LAKSHMINARAYAN

15th May 2013 Chairman

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Mar 31, 2012

NOTICE is hereby given that the Eighth Annual General Meeting of the Company will be held at "The Music Academy", New No 168 (Old No 306), T.T.K Road, Chennai 600 014 on Wednesday, the 25th day of July 2012 at 10.00 a.m. to transact the following business:

1. To consider and, if thought fit, to pass with or without modification, the following resolution as an ordinary resolution:

RESOLVED THAT the audited balance sheet as at 31st March, 2012 and the profit and loss account of the Company for the year ended on that date, together with the directors' report and the auditors' report thereon as presented to the meeting be and the same are hereby approved and adopted.

2. To consider and, if thought fit to pass with or without modification, the following resolution as an ordinary resolution:

RESOLVED THAT pursuant to the recommendation of the board of directors of the Company, a dividend of Rs. 5/- per share on 1,89,67,584 equity shares of Rs. 5/- each fully paid up absorbing a sum of Rs. 948.38 lakhs be and is hereby declared for the year ended 31st March, 2012 and the same be paid to the shareholders whose name appear in the register of members of the Company as at the close of 19th July, 2012.

3. To consider and, if thought fit, to pass with or without modification, the following resolution as an ordinary resolution:

RESOLVED THAT Mr Trevor Lucas, director who retires by rotation and being eligible for re-appointment, be and is hereby re-appointed as a director of the Company.

4. To consider and, if thought fit, to pass with or without modification, the following resolution as an ordinary resolution:

RESOLVED THAT Mr D E Udwadia, director who retires by rotation and being eligible for re-appointment, be and is hereby re-appointed as a director of the Company.

5. To consider and, if thought fit, to pass with or without modification, the following resolution as an ordinary resolution:

RESOLVED THAT Mr Vincent Pickering, who was appointed as a director of the Company with effect from 23rd May, 2012 to fill in the casual vacancy caused by the resignation of Mr Kurt Lehmann and holds office upto the date of this Annual General Meeting and in respect of whom the Company has received a notice in writing under Section 257 of the Companies Act, 1956 along with a deposit of Rs. 500/- from a shareholder intimating his intention to propose Mr Vincent Pickering for directorship, be and he is hereby appointed as a director of the Company.

6. To consider and if thought fit, to pass with or without modification, the following resolution as an ordinary resolution:

RESOLVED THAT Messrs. S.R. Batliboi & Associates Chartered Accountants, Tidel Park, 6th & 7th Floor - A Block (Module 601,701-702), No. 4, Rajiv Gandhi Salai, Taramani, Chennai - 600113, holding Firm Registration No.101049W allotted by the Institute of Chartered Accountants of India, be and are hereby appointed as the statutory auditors of the Company to hold office from the conclusion of this Annual General Meeting until the conclusion of the next Annual General Meeting of the Company.

RESOLVED FURTHER THAT the board of directors of the Company be and is hereby authorized to fix their remuneration and reimburse their travelling and out of pocket expenses.

7. To consider and if thought fit, to pass with or without modification, the following resolution as an ordinary resolution:

RESOLVED THAT subject to Section 310 and other applicable provisions of the Companies Act, 1956, read with Schedule XIII thereto and in partial modification of the ordinary resolution at item No. 7 passed by the shareholders, in the Sixth Annual General Meeting of the Company held on 26th August, 2010, approval of the shareholders of the Company be and is hereby accorded to the undermentioned increase in the remuneration payable to Mr P Kaniappan, Whole-time Director from 1st July 2012 until the expiry of his present term of office on 16th June 2014.

(i) Salary and commission on net profits or performance linked incentive or bonus; subject to a ceiling of Rs.90 lakhs per annum and

RESOLVED FURTHER THAT the Supplemental Agreement dated 23rd May 2012 between the Company and Mr P Kaniappan placed on the table incorporating the above increase in his remuneration, be and is hereby approved.

Notes:

1. A member entitled to attend and vote at the meeting is entitled to appoint one or more proxies to attend and vote instead of himself and the proxy or proxies so appointed need not be a member or members, as the case may be, of the Company. The instrument appointing the proxy and the power of attorney or other authority, if any, under which it is signed or a notarially certified copy of that power or authority shall be deposited at the registered office of the Company not later than 48 hours before the time fixed for holding the meeting.

2. An explanatory statement pursuant to Section 173(2) of the Companies Act, 1956 in respect of item no. 5 and 7 as set out in the notice is annexed hereto.

3. The Register of Members and the share transfer register will remain closed for a period of 6 days from 20th July, 2012 to 25th July, 2012 (both days inclusive) for the purpose of dividend to be approved by the shareholders at the ensuing Annual General Meeting of the Company.

4. In terms of Section 205A read with Section 205C of the Companies Act, 1956, the dividends declared by the Company, which remain unclaimed for a period of seven years will be transferred to the Investor Education and Protection Fund (IEPF), established by the Central Government on the due dates. The particulars of due dates for transfer of such unclaimed dividends to IEPF are furnished in the report on Corporate Governance forming part of the annual report.

Members who have not encashed their dividend warrants in respect of the above periods are requested to make their claim by surrendering the unencashed warrants immediately to the Company.

5. Members holding shares in physical form, in their own interest, are requested to dematerialize the shares to avail the benefits of electronic holding / trading.

6. Members are requested to register their e-mail address with the Company/Share transfer Agents immediately and participate in the "Green initiative" launched by the Ministry of Corporate Affairs.

7. Members holding shares in depository are requested to register their e-mail address with their depository participants and participate in the "Green initiative" launched by the Ministry of Corporate Affairs.

8. Members are requested to notify to the Company/ Share Transfer Agent immediately any change in their address. Members holding shares in depository are requested to advise change of address to their depository participants.

9. As a measure of economy, copies of the annual report will not be distributed at the Annual General Meeting.

Members are, therefore requested to bring their copies of the annual report to the meeting.

10. Members are requested to affix their signature at the space provided on the attendance sheet annexed to the proxy form and hand over the slip at the entrance of the meeting hall.

11. In terms of clause 49 (IV)(G) of the listing agreement with the stock exchanges, a brief resume of directors, who are proposed to be re-appointed in this meeting, nature of their expertise in specific functional areas, their other directorships and committee memberships and their shareholdings in the Company and their relationships with other directors in the Company are given below:

Brief resume and other information in respect of directors seeking re-appointment at the Annual General Meeting.

Mr Trevor Lucas:

Born on 3rd June 1948, Mr Trevor Lucas is a Bachelor of Business Studies (Honours), University of Dublin and a fellow member of the Institute of Chartered Accountants in Ireland.

He has served KPMG, Dublin from 1975 to 1982 as General Practice Manager. He was with CPC Europe, holding various positions as Manager Finance and Taxes, Manager Financial Services and Systems and Manager Financial Accounting.

He has also served as head of Finance for Council for Education, Recruitment and Training for the Hotel, Catering and Tourism Industry, Dublin.

He was with Best Foods Europe/Africa/Middle East, Brussels (later part of the Unilever Group) during 1989-2002 as Director Finance and Taxes.

He joined American Standard, Brussels, (WABCO Division) in 2003 as Vice President-Taxes. Following the spin off of WABCO Division from American Standard, he is presently the Vice President-Taxes of WABCO Holdings Inc.

He is a member of Audit committee, Investors' Grievance committee and Administrative committee of directors of the Company.

He does not hold any share in the Company and he is not related to any other directors of the Company.

Mr D E Udwadia:

Mr D E Udwadia is a post graduate from University of Bombay. He is an Advocate and Solicitor of the Bombay High Court. He is also a Solicitor of the Supreme Court of England.

Mr D E Udwadia was a partner of Crawford Bayley & Co., Mumbai, one of the India's leading law firms for nearly 22 years. He is a founder partner of Udwadia & Udeshi, Advocates and Solicitors, Mumbai. Consequent upon the reconstitution of the firm, its name was changed to Udwadia Udeshi & Argus Partners effective 1st April 2012. His firm and he are legal advisors to several Indian and multinational companies and foreign banks having a presence in India.

He has during his nearly 47 years of active law practice acquired valuable knowledge, experience and expertise in the areas of corporate law, mergers, acquisitions and take overs, corporate restructuring, foreign collaboration, joint ventures, project and infrastructure finance, intellectual property, international loans and finance related transactions and financial instruments, mutual funds, real estate and conveyancing.

He is a member of the Audit committee of directors of the Company. He does not hold any shares in the Company and he is not related to any other director of the Company. Details of his other directorships and memberships/ chairmanships of committees are given below:

Mr Vincent Pickering:

Born on 27th September 1968, Mr Vincent Pickering has law degree from the University of London, and is qualified as a U K Solicitor.

He began his career at the European Commission's Directorate General for Competition. He also gained diverse legal experience working with leading international law firms while based in Brussels and London.

He served as General Counsel and Head of Regulatory Affairs at Bulldog Communications, a U K based telecom service provider. He also served for 8 years at Microsoft Corporation in Redmond, Washington, USA, as Associate General Counsel for the company's Worldwide Licensing and Pricing Division. While there, he was responsible for legal support for Microsoft's global commercial sales, as well as Microsoft financing and the company's emerging market initiatives.

He does not hold any share in the Company and he is not related to any other directors of the Company.

EXPLANATORY STATEMENT PURSUANT TO SECTION 173(2) OF THE COMPANIES ACT, 1956.

Item No. 5

Mr Vincent Pickering was appointed as a director at the board meeting held on 23rd May, 2012 in the casual vacancy caused by the resignation of Mr Kurt Lehmann on 25th January, 2012. Mr Kurt Lehmann would have held office as a director upto the date of this Annual General Meeting had he not resigned. Pursuant to Section 262 of the Companies Act, 1956, Mr Vincent Pickering holds office upto the date of this Annual General Meeting.

Notice has been received from a shareholder of the Company under Section 257 of the Companies Act, 1956, along with a deposit of Rs. 500/- signifying his intention to propose the candidature of Mr Vincent Pickering for the office of director.

The directors recommend for approval the resolution at item no. 5 of the Notice.

Mr Vincent Pickering is interested or concerned in the resolution, since it relates to his appointment.

Item No: 7

Mr P Kaniappan was appointed as a Whole-time director for a period of five years with effect from 17th June 2009 by the board of directors of the company on 17th June 2009. His appointment as whole-time director and payment of remuneration to him were approved by the shareholders passed at the Fifth Annual General Meeting of the Company held on 24th September 2009.

In line with the general increase in remuneration payable to senior executives of the Company, the increase in his duties, functions and responsibilities and in recognition of the valuable services provided by him, the board of directors, in their meeting held on 23rd May 2012, increased the remuneration payable by way of salary and commission on net profits or performance linked incentive or bonus by increasing the present ceiling of Rs. 65 lakhs per annum to Rs. 90 lakhs per annum effective 1st July 2012 up to the expiry of his tenure as whole-time director on 16th June 2014.

The increase in remuneration of Mr P Kaniappan is well within the limits prescribed under Schedule XIII of the Companies Act, 1956.

All other terms and conditions of his appointment, as approved by the shareholders at the Sixth Annual General Meeting of the Company held on 26th August 2010, remain unchanged.

The above increase in the ceiling is subject to the approval of the shareholders in a General Meeting. Hence the resolution at item no. 7 is proposed.

A Supplemental Agreement dated 23rd May 2012 has been entered into by the Company with Mr P Kaniappan incorporating the above increase in his remuneration.

A copy of the Supplemental Agreement dated 23rd May 2012 referred to in the resolution at item no. 7 of the Notice will be open for inspection by shareholders between 11.00 a.m. and 2.00 p.m. on any working day of the Company at the Company's Registered Office.

The directors recommend the resolution for approval by the shareholders.

Mr P Kaniappan is interested or concerned in the resolution since it relates to his remuneration.

By order of the board

Chennai R MADHAVAN

23rd May 2012 General Manager -

Finance and Secretary Registered office: Plot No. 3 (SP), III Main Road Ambattur Industrial Estate Chennai 600 058.

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Mar 31, 2010

The directors herewith present the sixth annual report and the audited accounts for the year ended 31st March 2010.

2. FINANCIAL HIGHLIGHTS

Rs. in lakhs

Details Year ended Year ended

31.03.2010 31.03.2009

Sales and other income 60,946.82 44,577.78

Gross profit before interest and depreciation 13,567.09 7,334.11

Interest –Net 289.41 685.42

Depreciation 1,444.49 1,393.21

Profit before tax 11,833.19 5,255.48

Provision for taxation (including deferred tax and fringe benefit tax) 3,974.64 1,703.27

Profit after tax 7,858.55 3,552.21

Surplus /(loss) brought forward from previous year 5,156.52 2,515.10

Total 13,015.07 6,067.31 Appropriations:

Tax relating to earlier years 39.59 - Interim dividend paid - 474.20

Proposed dividend 474.20 - Dividend tax paid - 80.59

Dividend tax payable 78.76 -

Transfer to general reserve 785.86 356.00

Surplus/(Loss) in Profit & loss account 11,636.66 5,156.52

13,015.07 6,067.31

3. DIVIDEND

The board of directors have recommended a dividend of Rs 2.50 per share for the year ended 31st March 2010 (representing 50% on the paid up share capital of Rs 948.38 lakhs) absorbing a sum of Rs.474.20 lakhs for approval of the shareholders in the ensuing annual general meeting.

4. PERFORMANCE

During the year 2009-10, the sales of medium and heavy commercial vehicles (MHCV) registered a positive growth of 33% over the previous year 2008-09 and the sale of light commercial vehicles (LCV) registered a positive growth of 37% during the same period. Overall, the commercial vehicle (CV) industry ended with a positive growth of 35% over the previous year.

During the year, the Company achieved a total turnover of Rs 609 crores as against turnover of Rs 446 crores registered a growth of 37%. The growth in the turnover is due to improved economy resulted in growth in CV industry as explained in the above paragraph and also increased sales from aftermarket and exports.

The Company has outperformed MHCV market growth in OE through,

a. Increased content per sale; and

b. Improved market share

5. CAPITAL EXPENDITURE

A capital expenditure of Rs 35 crores is planned for the year 2010-2011 after considering the industry growth in this year. The expenditure will be incurred on a case to case basis.

6. DIRECTORS

During the year, Mr D E Udwadia, Mr Leon Liu and Mr Nikhil Madhukar Varty, directors, retire at the ensuing annual general meeting of the Company in terms of the articles of association of the Company, and being eligible, offer themselves for re-appointment.

A brief resume of the aforesaid directors and other information have been detailed in the notice convening the annual general meeting of the Company. Appropriate resolutions for their reappointment are being placed for approval of the shareholders at the ensuing annual general meeting. Your directors recommend their reappointment as directors of the Company.

7. AUDITORS

Messrs. Sundaram & Srinivasan, Chartered Accountants, Chennai have been re-appointed as statutory auditors at the last annual general meeting held on 24th September 2009 to hold office till the conclusion of the ensuing annual general meeting.

Messrs. Sundaram & Srinivasan, Chartered Accountants, Chennai, the retiring auditors of the Company have advised that they do not wish to be re-appointed as the Companys auditors at the ensuing annual general meeting. In view thereof, the directors recommend that Messrs. S.R. Batliboi & Associates, Chartered Accountants, Chennai, be appointed as the Companys auditors to hold office from the conclusion of the ensuing annual general meeting until the conclusion of the next following annual general meeting.

The Directors place on record their deep appreciation of the valuable services rendered by Messrs. Sundaram & Srinivasan, Chartered Accountants as Auditors.

8. STATUTORY STATEMENTS

Conservation of energy, technology absorption and foreign exchange earnings and outgo The information regarding conservation of energy, technology absorption and foreign exchange earnings and outgo is given in Annexure I to this report, as per the requirements 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.

Particulars of employees

Particulars of employees pursuant to Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended, is set out in Annexure II and forms part of this report. However, in pursuance of Section 219(1)(b)(iv) of the Companies Act, 1956, the Report and Accounts is being sent to all the Members of the Company excluding the aforesaid information and the said particulars will be made available on request and also made available for inspection at the Registered Office of the Company. Any Member interested in obtaining such particulars may write to the Company Secretary at the Registered Office of the Company.

Directors’ Responsibility Statement

Pursuant to the requirement of Section 217(2AA) of the Companies Act, 1956 with respect to directors responsibility statement, it is hereby confirmed:

(i) that in the preparation of annual accounts for the financial year ended 31st March 2010, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(ii) that the directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year under review;

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

(iv) that the directors had prepared the accounts for the financial year ended 31st March 2010 on a "going concern basis".

9. CORPORATE GOVERNANCE

The company has complied with the provisions of the Listing Agreement concerning corporate governance and a report to this effect is attached to this report as required by clause 49 of the Listing Agreement with the stock exchanges. A certificate issued by the auditors of the Company regarding compliance of conditions of corporate governance, is also annexed to the said report.

The whole-time director (CEO) and the chief financial officer (CFO) of the Company have certified to the board on financial statements and other matters in accordance with clause 49(V) of the Listing Agreement pertaining to CEO/CFO certification for the financial year ended 31st March 2010.

A management discussion and analysis report, as required by the Listing Agreement, is also attached which forms part of this report.

10. SHIFTING OF REGISTERED OFFICE OF THE COMPANY

The board of directors at their meeting held on 19th January 2010 have approved shifting of the registered office of the Company from No.29, Haddows Road, Chennai - 600 006 to the factory premises located at Plot No 3 (SP), III Main Road, Ambattur Industrial Estate, Chennai 600 058 effective 1st April 2010 for operational and administrative convenience.

Notice of the above change has been given to the Registrar of Companies in compliance with Section 146 of the Companies Act, 1956.

11. ACKNOWLEDGEMENT

The directors gratefully acknowledge the support and co-operation received from Messrs. T V Sundram Iyengar & Sons Limited, Madurai, who were a promoter shareholder till 3rd June 2009, and WABCO Europe BVBA, Belgium.

The directors thank the vehicle manufacturers, distributors, vendors and bankers for their continued support and assistance.

The directors wish to place on record their appreciation of the excellent work done by employees of the Company at all levels during the year. The directors specially thank the shareholders for the confidence reposed by them in the Company.

For and on behalf of the board

Chennai VENU SRINIVASAN

4th May 2010 Chairman