Directors Report of Samkrg Pistons & Rings Ltd.

Mar 31, 2018

DEAR SHAREHOLDERS

The Directors are pleased to present 32^ndAnnual Report and the Audited Accounts of the Company for the year ended March 31, 2018.

Financial Results (Rs. In Lakhs)

	2017-18	2016-17
Gross Sales	32397.76	28037.31
Other Income	228.60	134.78
Profit Before Interest, Depreciation and Tax (PBIDT)	4399.49	4162.16
Interest	128.51	173.49
Profit Before Depreciation and Tax (PBDT)	4270.98	3988.67
Depreciation	1305.18	1286.36
Profit Before Exceptional Item	2965.80	2702.31
C S R	37.50	31.65
Extraordinary Item	0	0
Profit After CSR	2928.30	2670.66
Provision for Taxation
i) Current Year	866.25	685.00
ii) Deferred Taxation	46.59	40.00
Net Profit Before Extraordinary Item	2015.46	1945.66
Extraordinary Item	0	0
Profit After Extraordinary Item	2015.46	1945.66

Note: Figures have been re-grouped wherever necessary to confirm to current period classification.

OPERATIONS:

The Company achieved the gross turnover of Rs.32397.76 Lakhs during year 2017-18 as against Rs.28037.31 Lakhs in the previous year 2016-17 there by recorded an increase of 15.55%. Your company has posted Net turnover of Rs.24527.71 Lakhs during year 2017-18 as compared to Rs.22965.02 Lakhs for the previous year 2016-17 i.e. an increase of 6.80%.

The company R&D expenditure is Rs.122.64 Lakhs i.e. 0.50% of Net sales during the year to catch up withup-gradation of technology and to meet OEM’s ever demanding quality and new developments requirement to improve life cycle of their product meeting BS IV norms of environmental standards for Auto components.

The operations of the Company on the whole have been satisfactory.

Earnings Before Depreciation, Interest and Tax (PBDIT) at Rs.4399.49 Lakhs as against previous year of Rs.4162.16 Lakhs. The Profit Before Tax was at Rs.2965.80 lakhs as compared to Rs. 2702.31 Lakhs in 2016-17 an increase of 9.75%

LISTING OF EQUITY SHARES

The Company’s equity shares are listed on BSE Ltd., Feroz Jeejeebai Towers, Dalal Street, Mumbai 400001.

MEETINGS OF THE BOARD OF DIRECTORS

The details of the Board of Directors Meeting held were given in the Report on Corporate Governance under Item No. 2(b).

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134 of the Companies Act, 2013 with respect to the Directors’ Responsibility Statement, the Board of Directors of the Company hereby confirms:

- In the participation of Annual Accounts the applicable Indian Accounting Standards have been followed and that there have been no material departures.

- 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 March 31, 2018 and the Profit & Loss account to the Company for that period.

- The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

- The Directors had prepared the Annual accounts on a going concern basis and

- The Directors, in the case of listed company, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

- 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.

- The Company’s Internal Auditors have conducted periodic audit to provide reasonable assurance that the Company’s established policies and procedures have been followed. The Audit Committee of the Board meets once in a quarter with Internal Auditors to review internal control and financial reporting issues.

STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS UNDER SECTION 149(6)

The Independent Directors have submitted the declaration of independence as required pursuant Sec. 147 of the Companies Act, 2013 stating that they meet the criteria of independence as provided in Sec. 149(6).

NOMINATION AND REMUNERATION COMMITTEE

The Nomination and Remuneration Committee consists of the following Directors namely Shri V Chakrapani, Shri M N Thakkar and Shri S. MadhavaRao.

Brief description of terms of reference:

- Identifying persons who are qualified to become Directors and who may be appointed in senior management in accordance with the criteria laid down and recommend to the Board for their appointment and removal.

- Carry on the evaluation of every Director’s performance;

- Formulation of the criteria for determining qualifications, positive attributes and independence of a Director;

- Recommend to the Board a policy relating to the remuneration of the Directors, key managerial personnel and other employees;

- Formulation of criteria for evaluation of independent Directors and the Board;

- Devising a policy on Board diversity; and

- Any other matter as the Board may decide from time to time.

Nomination and Remuneration policy The objective of the Policy:

1. To lay down criteria and terms and conditions with regard to identifying persons who are qualified to become Directors (Executive and Non-Executive) and persons who may be appointed in Senior Management and Key Managerial positions and to determine their remuneration.

2. To determine remuneration based on the Company’s size and financial positions and trends and practices on remuneration prevailing in peer companies.

3. To carry our evaluation of the performance of Directors.

4. To provide them reward linked directly to their effort, performance, dedication and achievement relating to the Company’s operations.

5. To retain, motivate and promote talent and to ensure long term sustainability of talented managerial persons and create competitive advantage.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS UNDER SECTION 186:

The company has neither issued any Loans, Guarantees nor made any investments during the Financial year.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO SEC. 188(1)

The particulars of contracts or arrangements with related parties referred to Section 188(1) are prepared in form No.AOC-2 pursuant to Section 134(3)(h) of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014. The details of the transactions with related parties are given in the financial statements.

TRANSFER OF AMOUNTS TO RESERVES

The Company proposes to transfer an amount of Rs.253.07 Lakhs to the General Reserve for the financial year ended 31st March, 2018.

DIVIDEND

The Board of Directors of the company at its meeting held on 4^thMay, 2018 have recommended @ 50% on equity share i.e. Rs.5.00 per share on face value of Rs. 10/- each.

EXTRACT OF ANNUAL RETURN

The Extract of Annual Return is prepared in Form MGT-9 as per the provisions of the Companies Act, 2013 and Rule 12 of the Companies (Management and Administration) Rules, 2014 and the same is enclosed as Annexure-1 to this report.

The conservation of energy, technology absorption, foreign exchange earnings and outgo pursuant to provisions of Sec. 134(3) (m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014.

Information with respect to the conservation of energy, technology absorption, foreign exchange earnings and outgo pursuant to provisions of Sec. 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 is prepared and annexed as Annexure -2 to this report.

RISK MANAGEMENT COMMITTEE

Risk management committee consists of the following Directors:

1. Shri S.D.M. Rao - Managing Director

2. Shri S Madhava Rao - Director

3. Shri V Chakrapani - Director RISK MANAGEMENT POLICY

The company has taken all the steps to mitigate the following risks:

Raw Material Prices : Ours is a continuous high volume manufacturing industry. Our profitability will depend on change in the price in Raw Materials and input costs.

Foreign Currency Risks: Exchange rate fluctuations may some times effect. Adequate steps were taken.

Competition and Price Pressure: The Company is facing stiff competition in the segments of OEMs and aftermarket as well as price pressure from the OEMs which playing major role on the profitability of the company.

CORPORATE SOCIAL RESPONSIBILITY COMMITTEE

The Corporate Social Responsibility Committee consists of the following Directors:

S.No.	Name	Designation
1	Shri V Chakrapani	Chairman
2	Shri S Kishore	Member
3	Shri S Madhava Rao	Member

Corporate Social Responsibility policy was adopted by the Board of Directors on the recommendation of Corporate Social Responsibility Committee.

Report on Corporate Social Responsibility as per Rule 8 of Companies (Corporate Social Responsibility) Rules, 2014 is prepared and the same is enclosed as Annexure - 3.

BOARD OF DIRECTORS

Shri S Madhava Rao, Director who is liable to retire by rotation at this Annual General Meeting and being eligible, offers himself for re-appointment.

DEPOSITS

The Company has not accepted any Deposits in terms of Section 73 of the Companies Act, 2013 and the rules made there under and hence compliance with the same as not applicable.

AUDITORS

Statutory Auditors

At the Annual General Meeting held on 25^th September, 2017 M/s. Sridhara Chary V & Co., Chartered Accountants, were appointed as statutory Auditors of the Company to hold office till the conclusion of the Annual General Meeting to be held in the calendar year 2022.

Auditors Report

There are no qualifications, reservations or adverse remarks made by M/s Sridhara Chary V & Co., Chartered Accountants (ICAI Reg. No.011478S) Statutory Auditors in their report for the Financial Year ended March 31st 2018.

Audit Committee

Composition Audit Committee included in Corporate Governance report.

Corporate Governance

A separate report on Corporate Governance is annexed as part of the Annual Report along with the Auditor’s Certificate on its compliance.

VIGIL MECHANISM

The Board of Directors have adopted whistle Blower policy. The Whistle Blower policy aims for conducting the affairs in the fair and transparent manner by adopting highest standards of professionalism, honest, integrity and ethical behavior. All permanent employees of the Company are covered under the Whistle Blower Policy.

A mechanism has been established for employees to report concerns about unethical behavior, actual or suspected fraud or violation of Code of Conduct and Ethics. It also provides for adequate safeguards against the victimization of employees who avail of the mechanism and allows direct access to the chairperson of the audit committee in exceptional cases.

SECRETARIAL AUDITOR REPORT

As per the provisions of Section 204 of the Companies Act, 2013, the Board of Directors have appointed Shri V B S S Prasad, Practicing Company Secretary (C.P.No: 4605) as Secretarial Auditor to conduct Secretarial Audit of the Company for the Financial year ended 31st March, 2018.

Secretarial Audit Report issued by Shri V B S S Prasad, Practicing Company Secretary in form MR-3 is enclosed as Annexure - 4 to this Annual Report.

There are no qualifications in Secretarial Audit Report.

PARTICULARS OF APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL:

The Statement of particulars of Appointment and Remuneration of Managerial Personnel as per Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as enclosed as per Annexure - 5 to this Annual Report.

INSURANCE

All properties and insurable interests of the Company including Building, Plant & Machinery and Stocks have been fully insured.

CHANGE IN NATURE OF BUSINESS

There is no change in the Company’s nature of business during the financial year ending March 31st, 2018.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The company has well defined internal control systems and procedures for ensuring optimum utilization of various resources, Investment decisions involving Capital Expenditure or taken up only after due appraisal and review. Internal audit function covers and carried out periodically and reviewed by the Audit Committee to ensure that all policies and procedures are adhered to, and all statutory obligations complied with.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS

No such orders have been received.

MATERIAL CHANGES AND COMMITMENTS

There are no Material changes and commitments in the business operations of the Company from the Financial year ended 31st March, 2018 to the date of signing of the Director’s Report.

POLICY ON SEXUAL HARASSMENT

The Company has adopted policy on Prevention of Sexual Harassment of Women at Work place in accordance with the Sexual Harassment of Women at Work place (Prevention, Prohibition and Redressal) Act, 2013.

During the Financial year ended 31st March, 2018, the company has not received any Complaints pertaining to Sexual Harassment.

ACKNOWLEDGEMENTS

Your Directors wish to place on record their appreciation for the cooperation and support of Bankers, Customers, Business Associates, Shareholders, Dealers, and Suppliers who are enabling the Company to achieve its goals. The Directors also place on record their appreciation made by the employees at all levels.

On behalf of the Board of Directors

Sd/-

S. D. M. RAO

CHAIRMAN & MANAGING DIRECTOR

Place : Hyderabad

Date : 4th May, 2018

---

Mar 31, 2016

DEAR SHAREHOLDERS

The Directors are pleased to present 30th Annual Report and the Audited Accounts of the Company for the year ended March 31, 2016.

Financial Results (Rs.In Lakhs)

	2015 -16	2014-15
Gross Sales	27394.71	25543.09
Less: Excise Duty	2874.62	2295.71
Net Sales	24520.09	23247.38
Total Expenditure	20971.05	19861.56
Other Income	38.49	33.52
Operating Profit (PBDIT)	3587.53	3419.34
Interest	155.21	461.99
Cash Profit	3432.32	2957.35
Depreciation	1170.57	1156.53
Profit before Exceptional Item	2261.71	1800.82
Exceptional Item	0	0
Profit after Exceptional Item	2261.71	1800.82
Provision for Taxation
i) Current Year	630.45	510.00
ii) Deferred Taxation	40.00	37.86
Net Profit before Extraordinary Item	1591.30	1252.97
Extraordinary Item	21.15	21.46
Profit after Extraordinary Item	1570.15	1231.51

Note: Figures have been re-grouped wherever necessary to confirm to current period classification.

OPERATIONS:

The Company achieved the gross turnover of Rs.27395 Lakhs during year 2015-16 as against Rs.25543 Lakhs in the previous year 2014-15 there by recorded an increase of 7.25%. Your company has posted Net turnover of Rs.24520 Lakhs during year 2015-16 as compared to Rs.23247 Lakhs for the previous year 2014-15 i.e. an increase of 5.48% only because of reduction in export sales due to slowdown in Europe, USA and Russia.

The company R&D expenditure is Rs.122.60 Lakhs

i.e., 0.50% of sales during the year to catch up with up- gradation of technology and to meet OEM’s ever demanding quality and new developments requirement to improve life cycle of their product meeting Euro III norms.

The operations of the Company on the whole have been satisfactory.

Earnings Before Depreciation, Interest and Tax (PBDIT) at Rs.3588 lakhs as against previous year of Rs.3419 Lakhs. The Profit Before Tax was at Rs.2262 lakhs as compared to Rs.1801 lakhs in 2014-15 an increase of 25.60%.

LISTING OF EQUITY SHARES

The Company’s equity shares are listed on BSE Ltd., Feroz Jeejeebai Towers, Dalal Street, Mumbai 400001.

MEETINGS OF THE BOARD OF DIRECTORS

During the year ended March 31st, 2016, 5 (Five) Board Meetings were held. The dates on which the Board Meetings were held are 25.05.2015, 05.08.2015, 10.11.2015, 08.02.2016 and 09.03.2016.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134 of the Companies Act, 2013 with respect to the Directors’ Responsibility Statement, the Board of Directors of the Company hereby confirms:

- In the participation of Annual Accounts the applicable accounting standards have been followed and that there have been no material departures.

- 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 March 31, 2016 and the profit loss account to the Company for that period.

- 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.

- The Directors had prepared the Annual accounts on a going concern basis and

- 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.

- 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.

- The Company’s Internal Auditors have conducted periodic audit to provide reasonable assurance that the Company’s established policies and procedures have been followed. The Audit Committee of the Board meets once in a quarter with Internal Auditors to review internal control and financial reporting issues.

STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS UNDER SECTION 149(6)

The Independent Directors have submitted the declaration of independence as required pursuant Sec.147 of the Companies Act, 2013 stating that they meet the criteria of independence as provided in Sec. 149(6).

NOMINATION AND REMUNERATION COMMITTEE

The Nomination and Remuneration Committee consists of the following Directors namely Mr. V Chakrapani, Mr. M N Thakkar and Mr. S. Madhava Rao.

Brief description of terms of reference:

- Identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down and recommend to the Board for their appointment and removal;

- Carry on the evaluation of every director’s performance;

- Formulation of the criteria for determining qualifications, positive attributes and independence of a director;

- Recommend to the Board a policy relating to the remuneration of the directors, key managerial personnel and other employees;

- Formulation of criteria for evaluation of independent Directors and the Board;

- Devising a policy on Board diversity; and

- Any other matter as the Board may decide from time to time.

- Nomination and Remuneration policy.

The objective of the Policy:

1. To lay down criteria and terms and conditions with regard to identifying persons who are qualified to become Directors (Executive and Non-Executive) and persons who may be appointed in Senior Management and Key Managerial positions and to determine their remuneration.

2. To determine remuneration based on the Company’s size and financial positions and trends and practices on remuneration prevailing in peer companies.

3. To carry our evaluation of the performance of Directors.

4. To provide them reward linked directly to their effort, performance, dedication and achievement relating to the Company’s operations.

5. To retain, motivate and promote talent and to ensure long term sustainability of talented managerial persons and create competitive advantage.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS UNDER SECTION 186:

The company has neither issued any Loans, Guarantees nor made any investments during the Financial year.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO SEC. 188(1)

The particulars of contracts or arrangements with related parties referred to Section 188(1) are prepared in form No.AOC-2 pursuant to Section 134(3)(h) of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014 and the same is enclosed as Annexure-1 to this report.

TRANSFER OF AMOUNTS TO RESERVES

The Company proposes to transfer an amount of Rs.196.27 lakh to the general reserve for the financial year ended 31st March, 2016.

DIVIDEND

The Board of Directors of the company at its meeting held on 9th March, 2016 have declared Interim dividend at 40% on equity share i.e Rs.4.00 per share on face value of Rs.10/- each.

The Board of Directors of the Company now recommended that the interim dividend be the final dividend for the year ended 31st March, 2016.

EXTRACT OF ANNUAL RETURN

The Extract of Annual Return is prepared in Form MGT-9 as per the provisions of the Companies Act, 2013 and Rule 12 of the Companies (Management and Administration) Rules, 2014 and the same is enclosed as Annexure-2 to this report.

The conservation of energy, technology absorption, foreign exchange earnings and outgo pursuant to provisions of Sec.134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014.

Information with respect to the conservation of energy, technology absorption, foreign exchange earnings and outgo pursuant to provisions of Sec. 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 is prepared and annexed as Annexure -3 to this report.

RISK MANAGEMENT COMMITTEE

Risk management committee consists of the following Directors:

1. Mr. S.D.M. Rao - Managing Director

2. Mr. S Madhava Rao - Director

3. Mr. V Chakrapani - Director RISK MANAGEMENT POLICY

The company has taken all the steps to mitigate the following risks:

Raw material prices : Ours is a continuous high volume manufacturing industry. Our profitability will depend on change in the price in raw materials and input costs.

Foreign currency Risks: Exchange rate fluctuations may sometimes effect. Adequate steps were taken.

Competition and Price Pressure: The Company is facing stiff competition in the segments of OEMs and aftermarket as well as price pressure from the OEMs which playing major roll on the profitability of the company.

CORPORATE SOCIAL RESPONSIBILITY COMMITTEE

The Corporate Social Responsibility committee consists of the following Directors:

S. No.	Name	Designation
1	Mr. V Chakrapani	Chairman
2	Mr. S Kishore	Member
3	Mr. S Madhava Rao	Member

Corporate social responsibility policy was adopted by the Board of Directors on the recommendation of corporate social responsibility committee.

Report on corporate social responsibility as per Rule 8 of Companies (Corporate Social Responsibility) Rules, 2014 is prepared and the same is enclosed as annexure - 4.

BOARD OF DIRECTORS

Shri S Karunakar, Director who is liable to retire by rotation at this Annual General Meeting and being eligible, offers himself for reappointment.

DEPOSITS

The Company has not accepted any Deposits in terms of Section 73 of the Companies Act, 2013 and the rules made there under and hence compliance with the same as not applicable.

AUDITORS

Statutory Auditors

At the Annual General Meeting held on 18th September, 2014 M/s. Ravi & Keshav, Chartered Accountants, were appointed as statutory Auditors of the Company to hold office till the conclusion of the Annual General Meeting to be held in the calendar year 2017. In terms of 1st proviso to section 139(1) of the Companies Act, 2013, the appointment of auditors shall be placed for ratification at every Annual General Meeting. Accordingly appointment of M/s. Ravi & Keshav, Chartered Accountants is placed for ratification by shareholders. In the regard, the Company has received a certificate from the Auditors to the effect, if they are appointed, it will be in accordance with the provisions of Section 141 of the Companies Act, 2013.

Auditors Report

There are no qualifications, reservations or adverse remarks made my M/s M/s Ravi & Keshav, chartered Accountants, Hyderabad Chartered Accountants (ICAI Reg. No.003187S) Statutory Auditors in their report for the Financial Year ended March 31st 2016.

Audit Committee

Composition Audit Committee included in Corporate Governance report.

Corporate Governance

A separate report on Corporate Governance is annexed as part of the Annual Report along with the Auditor’s Certificate on its compliance.

VIGIL MECHANISM

The Board of Directors have adopted whistle Blower policy. The Whistle Blower policy aims for conducting the affairs in the fair and transparent manner by adopting highest standards of professionalism, honest, integrity and ethical behaviour. All permanent employees of the Company are covered under the Whistle Blower Policy.

A mechanism has been established for employees to report concerns about unethical behaviour, actual or suspected fraud or violation of Code of Conduct and Ethics. It also provides for adequate safeguards against the victimization of employees who avail of the mechanism and allows direct access to the chairperson of the audit committee in exceptional cases.

SECRETARIAL AUDITOR REPORT

As per the provisions of Section 204 of the Companies Act, 2013, the Board of Directors have appointed Mr. V B S S Prasad, Practicing Company Secretary (C.P.No: 4605) as Secretarial Auditor to conduct Secretarial Audit of the Company for the Financial year ended 31st March, 2016.

Secretarial Audit Report issued by Mr. V B S S Prasad, Practicing Company Secretary in form MR-3 is enclosed as Annexure - 5 to this Annual Report.

There are no qualifications in Secretarial Audit Report.

PARTICULARS OF APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL

The Statement of particulars of Appointment and Remuneration of Managerial Personnel as per Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as enclosed as per Annexure - 6 to this Annual Report.

INSURANCE

All properties and insurable interests of the Company including building, plant & machinery and stocks have been fully insured.

CHANGE IN NATURE OF BUSINESS

There is no change in the Company’s nature of business during the financial year ending March 31st, 2016.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The company has well defined internal control systems and procedures for ensuring optimum utilization of various resources, Investment decisions involving Capital Expenditure or taken up only after due appraisal and review. Internal audit function covers and carried out periodically and reviewed by the Audit Committee to ensure that all policies and procedures are adhered to, and all statutory obligations complied with.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS

No such orders have been received.

MATERIAL CHANGES AND COMMITMENTS

There are no Material changes and commitments in the business operations of the Company from the Financial year ended 31st March, 2016 to the date of signing of the Director’s Report.

POLICY ON SEXUAL HARASSMENT

The Company has adopted policy on Prevention of Sexual Harassment of Women at Workplace in accordance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

During the Financial year ended 31st march, 2016, the company has not received any Complaints pertaining to Sexual Harassment.

ACKNOWLEDGEMENTS

Your Directors wish to place on record their appreciation for the cooperation and support of Bankers, Customers, Business Associates, Shareholders, dealers, and suppliers who are enabling the Company to achieve its goals. The Directors also place on record their appreciation made by the employees at all levels.

On behalf of the Board of Directors

Sd/-

S. D. M. RAO

Place : Hyderabad CHAIRMAN &

Date : 23.05.2016 MANAGING DIRECTOR

---

Mar 31, 2015

Dear Members,

The Directors are pleased to present 29th Annual Report and the Audited Statement of Accounts of the Company for the year ended March 31,2015.

FINANCIAL RESULTS: (Rs. In lacs)

2014-2015 2013-2014

Gross Sales 25543.09 22810.03

Less: Excise Duty 2295.71 2247.31

Income from Operations 23247.38 20562.72

Total Expenditure 19861 17577.59

Other Income 33.52 20.72

Operating Profit (PBDIT) 3419.34 3005.85

Financial Cost 461.99 467.81

Cash Profit 2957.35 2538.04

Depreciation 1156.53 1045.06

Profit before Exceptional 1800.82 1492.98

Item

Exceptional Item - 66.18

Profit after Exceptional 1800.82 1559.17

Item

Provision for Taxation

i) Current Year 510.00 450.00

ii) Deferred Taxation 37.86 34.57

Net Profit before 1252.97 1074.60

Extraordinary Item

Extraordinary Item 21.46 -

Profit after Extraordinary 1231.51 1074.60

Item

Note: Figures have been re-grouped wherever necessary to confirm to current period classification.

OPERATIONS:

The Company achieved the gross turnover of Rs. 25543.09 lakhs during 2014-15 as against Rs. 22810.04 lakhs in the previous year 2013-14 there by recorded an increase of 12%.

The company R&D expenditure is Rs. 127.86 lakhs i.e., 0.55% of sales during the year to catch up with up- gradation of technology and to meet OEM's ever demanding quality and new developments requirement to improve life cycle of their product meeting Euro III norms.

The operation of the Company on the whole has been satisfactory.

Your company has posted Net turnover of Rs. 23247.38 lacs as compared to Rs. 20562.72 lacs for the previous year an increase of 13.06%.

Earnings Before Depreciation, Interest and Tax (PBDIT) at Rs. 3419.34 lakhs as against previous year of Rs. 3005.85 Lakhs. The Profit Before Tax was at Rs. 1800.82 lakhs as compared to Rs. 1559.17 lakhs in 2013-14 an increase of 15.50%

LISTING OF EQUITY SHARES

The Company's equity shares are listed on BSE Ltd., Feroz Jeejeebai Towers, Dalal Street, Mumbai 400001.

MEETINGS OF THE BOARD OF DIRECTORS

During the year ended March 31st, 2015, 4 (four) Board Meetings were held. The dates on which the Board Meetings were held are 19.05.2014, 06.08.2014, 15.10.2014 and 02.02.2015.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134 of the Companies Act, 2013 with respect to the Directors' Responsibility Statement, the Board of Directors of the Company hereby confirms:

(a) in the preparation of the annual accounts, the

applicable accounting standards had been followed along with proper explanation relating to material departures;

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

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

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

(e) the directors, in the case of a listed company, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

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

The Company's Internal Auditors have conducted periodic audit to provide reasonable assurance that the Company's established policies and procedures have been followed. The Audit Committee of the Board meets once in a quarter with Internal Auditors to review internal control and financial reporting issues.

STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS UNDER SECTION149(6)

The Independent Directors have submitted the declaration of independence as required pursuant Sec.147 of the Companies Act, 2013 stating that they meet the criteria of independence as provided in Sec. 149(6).

NOMINATION AND REMUNERATION COMMITTEE

The Nomination and Remuneration Committee consists of the following Directors namely Mr. V Chakrapani, Mr. M N Thakkar and Mr. S. Madhava Rao.

Brief description of terms of reference:

- Identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down and recommend to the Board for their appointment and removal;

- Carry on the evaluation of every director's performance;

- Formulation of the criteria for determining qualifications, positive attributes and independence of a director;

- Recommend to the Board a policy relating to the remuneration of the directors, key managerial personnel and other employees;

- Formulation of criteria for evaluation of independent Directors and the Board;

- Devising a policy on Board diversity; and

- Any other matter as the Board may decide from time to time.

- Nomination and Remuneration policy

The objective of the Policy.

1. To lay down criteria and terms and conditions with regard to identifying persons who are qualified to become Directors (Executive and Non-Executive) and persons who may be appointed in Senior Management and Key Managerial positions and to determine their remuneration.

2. To determine remuneration based on the Company's size and financial positions and trends and practices on remuneration prevailing in peer companies.

3. To carry our evaluation of the performance of Directors.

4. To provide them reward linked directly to their effort, performance, dedication and achievement relating to the Company's operations.

5. To retain, motivate and promote talent and to ensure long term sustainability of talented managerial persons and create competitive advantage.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS UNDER SECTION 136.

The company has neither issued any Loans, Guarantees nor made any investments during the Financial year.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO Sec. 188(1)

Related parties to Sec. 188(1) is prepared in form No. AOC-2 pursuant to Sec. 134(3)(h) of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014 and the same is enclosed as Annexure-1 to this report.

TRANSFER OF AMOUNTS TO RESERVES

The Company proposes to transfer an amount of Rs. 153.94 lakh to the general reserve for the financial year ended 31st March, 2015.

DIVIDEND

In view of requirement of funds for the operations of the company and to meet with Capital expenditure with internal accruals and also to improve liquidity, your Directors recommend a dividend of Rs. 3.00 per equity share i.e 30% for the Year Ended 31st March 2015 as against Rs. 2.50 per equity share ie.25% in the previous year.

EXTRACT OF ANNUAL RETURN

The Extract of Annual Return is prepared in Form MGT-9 as per the provisions of the Companies Act, 2013 and Rule 12 of the Companies (Management and Administration) Rules, 2014 and the same is enclosed as Annexure - 2 to this report.

The conservation of energy, technology absorption, foreign exchange earnings and outgo pursuant to provisions of Sec. 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014. Attached herewith as Annexure-3.

RISK MANAGEMENT COMMITTEE

Risk management committee consists of the following Directors:

1. Mr. S.D.M. Rao - Managing Director

2. Mr. S Madhava Rao - Director

3. Mr. V Chakrapani - Director RISK MANAGEMENT POLICY

The company has taken all the steps to mitigate the following risks:

Raw material prices : Ours is a continuous high volume manufacturing industry. Our profitability will depend on change in the price in raw materials and input costs.

Foreign currency Risks: Exchange rate fluctuations may some times effect. Adequate steps were taken.

Competition and Price Pressure: The Company is facing stiff competition in the segments of OEMs and aftermarket as well as price pressure from the OEMs which playing major roll on the profitability of the company.

CORPORATE SOCIAL RESPONSIBILITY COMMITTEE

The Corporate Social Responsibility committee consists of the following Directors:

S. No. Name Designation

1 Mr. V Chakrapani Chairman

2 Mr. S Kishore Member

3 Mr. S Madhava Rao Member

Corporate social responsibility policy was adopted by the Board of Directors on the recommendation of corporate social responsibility committee.

Report on corporate social responsibility as per Rule 8 of Companies (Corporate Social Responsibility) Rules, 2014 is prepared and the same is enclosed as annexure - 4.

BOARD OF DIRECTORS

Ms. N Rishita appointed as Independent director on 02.02.2015 and she is eligible offer to be appointed as director (women) of the company.

Shri Akula Venkateswara Rao, appointed as Independent director on 02.02.2015 representing minority shareholders and he is eligible offer to be appointed as director of the company.

DIRECTORS AND KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR HAVE RESIGNED DURING THE YEAR

Mr. V Venkat Reddy has been resigned on 2nd February, 2015

Sri. S.Madhava Rao,Sri.V. Chakrapani and

Sri.M.N.Thakkar were appointed as independent Directors to hold office for a term of 5 Years in the AGM held on 18th September,2014.

Further Mr. Akula Venkateswara Rao was appointed as Additional Director (independent) and Ms. Nama Rishitha was appointed as Additonal director (Independent woman Directors).

DEPOSITS

The Company has not accepted any Deposits in terms of Sec.73 of the Companies Act, 2013 and the rules made there under and hence compliance with the same as not applicable.

AUDITORS Statutory Auditors

The Company, in terms of Section 139(a) and (2) of the Act 2013, is required to appoint statutory auditors for a term of five consecutive years i.e., till the conclusion of sixth annual general meeting and ratify their appointment, during the period, in every annual general meeting by an ordinary resolution.

The period for which any firm has held office as auditor prior to the commencement of the Act 2013 will be taken into account for calculating the period of five consecutive years, as per the fourth proviso to Section 139(s) of the Act 2013 read with Rule 6(3) of the Companies (Audit and Auditors) Rules, 2014.

M/s. Ravi & Kesav, Chartered Accountants, Hyderabad, who were earlier appointed as statutory auditors of the Company, at the Annual General Meeting held on 27th September, 2013, are eligible to be appointed for the remaining period of three years out of the first term of five consecutive years in terms of the Act 2013.

The Company has obtained necessary certificate under Section 141 of the Act 2013 from the auditor conveying their eligibility for the above appointment. The audit committee and board received their eligibility criteria, as laid down under section 141 of the Act 2013 and recommended their appointment as auditors for the aforesaid period.

Audit Committe

Composition Audit Committee included in Corporate Governance report.

Corporate Governance

Pursuant to the provisions of the Clause 49 of the Listing Agreement a report on Corporate Governance and a certificate from the Statutory Auditors regarding the Compliance of conditions of Corporate Governance are annexed to and form part of this Annual Report.

VIGIL MECHANISM

The Board of Directors have adopted whistle Blower policy. The Whistle Blower policy aims for conducting the affairs in the fair and transparent manner by adopting highest standards of professionalism, honest, integrity and ethical behavior. All permanent employees of the Company are covered under the Whistle Blower Policy.

A mechanism has been established for employees to report concerns about unethical behavior, actual or suspected fraud or violation of Code of Conduct and Ethics. It also provides for adequate safeguards against the victimization of employees who avail of the mechanism and allows direct access to the chairperson of the audit committee in exceptional cases. SECRETARIAL AUDIT REPORT

As per the provisions of Section 204 of the Companies Act, 2013, the Board of Directors have oppointed Mr. V B S S Prasad, Practicing Company Secretary (C.P.No: 4605) as Secretarial Auditor to conduct Secretarial Audit of the Company for the Financial year ended 31st March, 2015.

Secretarial Audit Report issued by Mr. V B S S Prasad, Practicing Company Secretary in form MR-3 is enclosed as Annexure - 5 to this Annual Report.

There are no qualification in Secretarial Audit Report.

PARTICULARS OF APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL.

The Statement of particulars of Appointment and Remuneration of Managerial Personnel as per Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as enclosed as per Annexure - 6 to this Annual Report.

INSURANCE

All properties and insurable interests of the Company including building, plant & machinery and stocks have been fully insured.

CHANGE IN NATURE OF BUSINESS

There is no change in the Company's nature of business during the financial year ending March 31st, 2015.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The company has well defined internal control systems and procedures for ensuring optimum utilization of various resources, Investment decisions involving Capital Expenditure or taken up only after due appraisal and review. Internal audit function covers and carried out periodically and reviewed by the Audit Committee to ensure that all policies and procedures are adhered to, and all statutory obligations complied with.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS

No such orders have been received.

MATERIAL CHANGES AND COMMITMENTS

There are no Material changes and commitments in the business operations of the Company from the Financial year ended 31st March, 2015 to the date of signing of the Director's Report.

POLICY ON SEXUAL HARASSMENT

The Company has adopted policy on Prevention of Sexual Harassment of Women at Workplace in accordance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

During the Financial year ended 31st March, 2015, the company has not received any Complaints pertaining to Sexual Harassment.

ACKNOWLEDGEMENTS

Your Directors wish to place on record their appreciation for the cooperation and support of Bankers, Customers, Business Associates, Shareholders, dealers, and suppliers who are enabling the Company to achieve its goals. The Directors also place on record their appreciation made by the employees at all levels.

On behalf of the Board of Directors S.D.M. RAO

Place : Hyderabad CHAIRMAN

Date : 25.05.2015 & MANAGING DIRECTOR

---

Mar 31, 2014

Dear Members,

The Directors are pleased to present 28th Annual Report and the Audited Accounts of the Company for the year ended March 31, 2014.

FINANCIAL RESULTS: (Rs. In lacs) 2013-14 2012-13

Gross Sales 22810.03 19284.49

Less: Excise Duty & Sales Tax 2247.31 1939.58

Net Sales 20562.72 17344.91

Total Expenditure 17577.59 14593.36

Other Income 20.72 30.34

Operating Profit (PBDIT) 3005.85 2781.89

Interest 467.81 474.34

Cash Profit 2538.04 2307.56

Depreciation 1045.06 1034.64

Profit before Exceptional Item 1492.98 1272.92

Exceptional Item 66.18 -

Profit after Exceptional Item 1559.17 1272.92 Provision for Taxation

i) Current Year 450.00 380.00

ii) Deferred Taxation 34.57 26.00

Net Profit / (Loss) after Tax 1074.60 866.93

Note: Figures have been re-grouped wherever necessary to confirm to current period classification

DIVIDEND:

In view of requirement of funds for the operations of the company and to meet with Capital expenditure with internal accruals and also to improve liquidity, your Directors recommend a dividend of Rs. 2.50 per equity share i.e 25% for the Year Ended 31st March 2014 as against Rs. 2.50 per equity share ie.25% in the previous year.

OPERATIONS:

The Company achieved the gross turnover of Rs. 22810.03 lakhs during 2013-14 as against Rs. 19284.49 lakhs in the previous year 2012-13 there by recorded an increase of 18.28%.

The company R&D expenditure is 113.09 lakhs i.e.,

0.55% of sales during the year to catch up with up- gradation of technology and to meet OEM''s ever demanding quality and new developments requirement to improve life cycle of their product meeting Euro III norms.

The operation of the Company on the whole has been satisfactory.

Your company has posted Net turnover of Rs. 20562.72 lacs as compared to Rs. 17346.91 lacs for the previous year an increase of 18.55%.

Earnings Before Depreciation, Interest and Tax (PBDIT) at Rs. 3005.85 lakhs as against previous year of Rs. 2781.91 Lakhs. The Profit Before Tax was at Rs. 1559.17 lakhs as compared to Rs. 1272.93 lakhs in 2012-13 an increase of 22.49%.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

Auto Component Industry growth marging during the 2013-14. Micro ecoomic envirounment continued to remaind weak. Depresed economic sentiments caupled with high price levels and poor income growth continued to affect the Industry.

The Company has very good opportunities because of valued customers both in Domestic OEM''s and Replacement Market & Exports. The Company exports increased by 23% during 2013-14 due to demand expansion, better products mix.

The Company has got very strong distribution network at their aftermarket sales because of imports from free trade zones the competition is very stiff and price sensitive.

OUTLOOK:

The company continues its drive for sustainable growth in this growing Domestic automotive industry. In view of strong support of OEM''s and because of establishing good distribution net work, company is poised for good growth.

All the cost effective steps have been taken with technical support from Japan and to meet the challenges of price competition and also quality, delivery and logistics.

The 2w segment prospect in longterm even though Indian economy has been experiencing a slow groth.

CONCERN & RISKS:

The company has taken all the steps to mitigate the following risks:

Raw material prices : Ours is a continuous high volume manufacturing industry. Our profitability will depend on change in the price in raw materials and input costs.

Foreign currency Risks: Exchange rate fluctuations may some times effect. Adequate steps were taken.

Competition and Price Pressure: The Company is facing stiff competition in the segments of OEMs and

aftermarket as well as price pressure from the OEMs which playing major roll on the profitability of the company.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has well defined internal control systems and procedures to ensure that on the assets of the Comapny on safegard and protected against any loss and optimum utilization of various resources, Investment decisions involving Capital Expenditure or taken up only after due appraisal and review. Internal audit function covers and carried out periodically and reviewed by the Audit Committee to ensure that all policies and procedures are adhered to, and all statutory obligations complied with.

FINANCIAL PERFORMANCE:

The Company earned total net revenue of Rs. 20562.72 lakhs compared with Rs. 17344.91 lakhs in the previous year and the operational expenses Rs. 19824.70 lakhs compared with Rs. 16532.94 lakhs incurred last year mainly on account of steep increase in raw material cost, power cost and drop in sales.

Profit Before Depreciation, interest and tax (PBDIT) at Rs. 3005.85 lakhs. The Profit Before Tax was at Rs. 1559.17 lakhs as compared to Rs. 1272.93 Lakhs in 2012-13 an increase of 22.49%. Company has been able to pay all the long term loans outstands and as of.

HUMAN RESOURCES:

The Company maintains cordial industrial relations environment and the Company continues to establish its training facilities.

The Company intending talents through job rotation, challenging projects assignments and exposer to globaly acclaimed programms are taken up on a regular basis.

CAUTIONARY STATEMENT:

Statements in this Management Discussion and Analysis describing the Company''s objective, projections, estimates and expectations may constitute forward looking statements within the meaning of applicable laws and regulations. Actual results might differ marginally or materially from those either expressed or implied.

10 YEARS RECORD:

A chart showing 10 Years performance is appended forming part of this report.

CORPORATE GOVERNANCE:

Pursuant to the provisions of the Clause 49 of the Listing Agreement a report on Corporate Governance and a certificate from the Statutory Auditors regarding the Compliance of conditions of Corporate Governance are annexed to and form part of this Annual Report.

EXPORTS:

The Export Turnover of Rs. 4871.51 lakhs during the year as against Rs. 3955.96 lakhs of the previous year because of recession in US & Europe our exports are increased by 23.14%.

The Company is focusing exports to developed Countries like Europe, U.K, France, Germany, Brazil and Russia. The Company has plans to reach 25% to 30% of the Turnover during the next 2 years.

POLLUTION CONTROL SAFETY & ENVIRONMENTAL PROTECTION:

We are complying all the norms prescribed by the statutory authorities'' i. e. A. P. Pollution Control Board.

The Company very much concerned for safety of men and machines through safety awareness training programmes.

BOARD OF DIRECTORS:

Shri S Madhava Rao, Director is liable to retire by rotation at this Annual General Meeting and being eligible, offers himself for reappointment.

Shri Dr. V Venkat Reddy, Director is liable to retire by rotation at this Annual General Meeting and being eligible, offers himself for reappointment.

DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to Section 217 (2AA) of the Companies (Amendment) Act, 2000 your Directors are hereby confirmed that:

* In the participation of Annual Accounts the applicable accounting standards have been followed and that there have been no material departures.

* 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 March 31, 2014 and of the profit to the Company for the year.

* Your 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.

* That the Directors have prepared the Annual accounts on a going concern basis.

The Company''s Internal Auditors have conducted periodic audit to provide reasonable assurance that the Company''s established policies and procedures have been followed. The Audit Committee of the Board meets once in a quarter with Internal Auditors to review internal control and financial reporting issues.

AUDITORS:

Statutory Auditors

The Company, in terms of Section 139 (1) and (2) of the Act 2013, is required to appoint statutory auditors for a term of five consecutive years i.e., till the conclusion of sixth annual general meeting and ratify their appointment, during the period, in every annual general meeting by an ordinary resolution.

The period for which any firm has held office as auditor prior to the commencement of the Act 2013 will be taken into account for calculating the period of five consecutive years, as per the fourth proviso to Section 139(2) of the Act 2013 read with Rule 6(3) of the Companies (Audit and Auditors) Rules, 2014.

M/s. Ravi & Kesav., Chartered Accountants, Hyderabad, who were earlier appointed as statutory auditors of the Company, at the annual general meeting held on 27th September, 2013, are eligible to be appointed for the remaining period of three years out of the first term of five consecutive years in terms of the Act 2013.

The Company has obtained necessary certificate under Section 141 of the Act 2013 from the auditor conveying their eligibility for the above appointment. The audit committee and board reviewed their eligibility criteria, as laid down under Section 141 of the Act 2013 and recommended their appointment as auditors for the aforesaid period.

PARTICULARS OF EMPLOYEES:

Particulars of employees required to be furnished under section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 are given in the annexed statement with forms an integral part of this report. The Company continued to have cordial and harmonious relations with its employees.

DISCLOSURE OF PARTICULARS:

The information required under section 217(1 )(e) of the Companies Act, 1956 read with Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988 is given in the Annexure-1 forming part of this report.

FIXED DEPOSITS:

The Company has not accepted any Deposits in terms of Sec.58 (A) of the Companies Act, 1956 and the rules made there under and hence compliance with the same as not applicable.

ACKNOWLEDGEMENTS:

Your Directors wish to place on record their appreciation for the cooperation and support of Bankers, Customers, Business Associates, Shareholders, dealers, and suppliers who are enabling the Company to achieve its goals. The Directors also place on record their appreciation made by the employees at all levels.

NOTES:

1. Designation of Employee indicates the nature of his duties.

2. Remuneration includes Salary, Commission, House Rent Allowance and Perquisites.

for and on behalf of the Board

Place : Hyderabad S. D. M. RAO Date : 19.05.2014 Chairman & Managing Director

---

Mar 31, 2013

DEAR SHAREHOLDERS

The Directors are pleased to present 27th Annual Report and the Audited Accounts of the Company for the year ended March 31, 2013.

Financial results

(Rs. in lacs)

2012 - 2013 2011-2012

Gross Sales 19233.38 21933.89

Less: Excise Duty 1939.58 2010.30

Net Sales 17293.80 19923.59

Total Expenditure 14593.34 16819.48

Other Income 81.45 108.71

Operating Profit (PBDIT) 2781.91 3212.82

Interest 474.34 384.53

Cash Profit 2307.57 2828.29

Depreciation 1034.64 1053.15

Profit before Tax 1272.93 1775.14

Provision for Taxation

i) Current Year 380.00 541.35

ii) Fringe Benefit Tax - -

iii) Deferred Taxation 26.00 56.00

Net Profit / (Loss) after Tax 866.93 1177.79



Note: Figures have been re-grouped wherever necessary to confirm to current period classification.

DIVIDEND:

In view of requirement of funds for the operations of the company and to meet with Capital expenditure with internal accruals and also to improve liquidity, your Directors recommend a dividend of Rs. 2.50 per equity share i.e 25% for the Year Ended 31st March 2013 as against Rs. 3.50 per equity share ie.35% in the previous year.

OPERATIONS:

The Company achieved the gross turnover of Rs. 19233.38 lacs during 2012-13 as against Rs. 21933.89 lacs in the previous year 2011-12.

The company R&D expenditure is Rs. 86.47 lacs i.e., 0.50% of sales during the year to catch up with up-gradation of technology and to meet OEM''s ever demanding quality and new developments requirement to improve life cycle of their product meeting Euro III norms.

The operation of the Company on the whole has been satisfactory.

Your company has posted Net turnover of Rs. 17293.80 lacs as compared to Rs. 19923.59 lacs for the previous year. The lower turnover is mainly due to slow down in industry and mostly because of slow down in rural economy and power shortage.

Earnings Before Depreciation, Interest and Tax (PBDIT) at Rs. 2781.91 lacs as against previous year of Rs. 3212.82 Lacs. The Profit Before Tax was at Rs. 1272.93 lacs as compared to Rs.1775.14 lacs in 2011-12.

Management Discussion and Analysis Report:

Auto Component Industry is slowdown. Indian Industry is now growing as potential Global automotive supplier with very good export potential as the developing Countries comes out of recession.

The Company has very good opportunities because of valued customers both in Domestic OEM''s and Replacement Market & Exports and also intime supplies, superior quality products and our technical expertise both from Japanese & German Consultants.

The Company has got very strong distribution network at their aftermarket sales because of imports from free trade zones the competition is very stiff and price sensitive.

Outlook:

The company continues its drive for sustainable growth in this growing Domestic automotive industry. In view of strong distribution network, committed technical and non-technical employees company able to meet and withstand the challenges of the market.

All the cost effective steps have been taken to meet the challenges of price competition and also quality, delivery and logistics.

The company is expects moderate demand growth in the automobile industry during 2013-14 and long term prospects for the industry remain strong in the line with the outlook for the OEM segment.

Concern & Risks:

The company has taken all the steps to mitigate the following risks:

Raw material prices: Ours is a continuous high volume manufacturing industry. Our profitability will depend on change in the price in raw materials and input costs.

Foreign currency Risks: Exchange rate fluctuations may some times effect. Adequate steps were taken.

Competition and Price Pressure: The Company is facing stiff competition in the segments of OEMs and aftermarket as well as price pressure from the OEMs which playing major roll on the profitability of the company.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The company has well defined internal control systems and procedures for ensuring optimum utilization of various resources, Investment decisions involving Capital Expenditure or taken up only after due appraisal and review. Internal audit function covers and carried out periodically and reviewed by the Audit Committee to ensure that all policies and procedures are adhered to, and all statutory obligations complied with.

FINANCIAL PERFORMANCE:

The Company earned total net revenue of Rs. 17344.91 lacs compared with Rs. 19933.74 lacs in the previous year and the operational expenses Rs. 18041.90 lacs compared with Rs. 20381.85 lacs incurred last year mainly on account of steep increase in raw material cost, power cost and drop in sales.

Profit Before Depreciation, interest and tax (PBDIT) at Rs. 2781.91 lacs. The Profit Before Tax was at Rs. 1272.93 lacs during 2012-13 as compared to Rs. 1775.14 Lacs in 2011-12.

HUMAN RESOURCES:

The Company maintains cordial industrial relations environment and the Company continues to establish its training facilities.

The Company making to be available and encourages good talent in the rapidly challenging business and competitive environment. Adequate safety measures, training and development of the employees, continued to receive top priority.

CAUTIONARY STATEMENT:

Statements in this Management Discussion and Analysis describing the Company''s objective, projections, estimates and expectations may constitute forward looking statements within the meaning of applicable laws and regulations. Actual results might differ marginally or materially from those either expressed or implied.

10 YEARS RECORD:

A chart showing 10 Years performance is appended forming part of this report.

Corporate Governance:

Pursuant to the provisions of the Clause 49 of the Listing Agreement a report on Corporate Governance and a certificate from the Statutory Auditors regarding the Compliance of conditions of Corporate Governance are annexed to and form part of this Annual Report.

EXPORTS:

The Export Turnover of Rs. 3955.96 lacs during the year as against Rs. 3868.91 lacs of the previous year an increase by 2.25%.

The Company is focusing exports to developed Countries like Europe, U.K, France, Germany, Brazil and Russia. The Company has plans to reach 25% to 30% of the Turnover during the next 2 years.

POLLUTION CONTROL SAFETY & ENVIRONMENTAL PROTECTION:

We are complying all the norms prescribed by the statutory authorities'' i. e. A. P. Pollution Control Board.

The Company very much concerned for safety of men and machines through safety awareness training programmes.

BOARD OF DIRECTORS:

Shri V Chakrapani, Director is liable to retire by rotation at this Annual General Meeting and being eligible, offers himself for reappointment.

Shri M N Thakkar, Director is liable to retire by rotation at this Annual General Meeting and being eligible, offers himself for reappointment.

DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to Section 217 (2AA) of the Companies (Amendment) Act, 2000 your Directors are hereby confirmed that:

In the participation of Annual Accounts the

- applicable accounting standards have been followed and that there have been no material departures.

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 March 31, 2013 and of the profit to the Company for the year.

Your 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.

That the Directors have prepared the Annual

- accounts on a going concern basis.

The Company''s Internal Auditors have conducted periodic audit to provide reasonable assurance that the Company''s established policies and procedures have been followed. The Audit Committee of the Board meets once in a quarter with Internal Auditors to review internal control and financial reporting issues.

AUDITORS:

M/s. Ravi & Keshav, Chartered Accountants, will retire at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. The Company has received the Certificate U/s 224 (1-B) of the companies Act, 1956 from M/s. Ravi & Keshav that their appointment, if made, would be in compliance with the provisions of said section. Relevant notes to the Accounts concerning Auditors observation there on are self-explanatory.

PARTICULARS OF EMPLOYEES:

Particulars of employees required to be furnished under section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 are given in the annexed statement with forms an integral part of this report. The Company continued to have cordial and harmonious relations with its employees.

DISCLOSURE OF PARTICULARS:

The information required under section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988 is given in the Annexure-1 forming part of this report.

FIXED DEPOSITS:

The Company has not accepted any Deposits in terms of Sec.58 (A) of the Companies Act, 1956 and the rules made there under and hence compliance with the same as not applicable.

ACKNOWLEDGEMENTS:

Your Directors wish to place on record their appreciation for the cooperation and support of Bankers, Customers, Business Associates, Shareholders, dealers, and suppliers who are enabling the Company to achieve its goals. The Directors also place on record their appreciation made by the employees at all levels.



On behalf of the Board of Directors

S.D.M. RAO

Place : Hyderabad CHAIRMAN

Date : 16.05.2013 & MANAGING DIRECTOR

---

Mar 31, 2012

The Directors are pleased to present 26th Annual Report and the Audited Accounts of the Company for the year ended March 31, 2012.

Financial results

(Rs. in lacs)

2011-2012 2010-2011

Gross Sales 21933.89 19751.54

Add : Other Operating Revenue 10.15 18.26

Less: Excise Duty & Sales Tax 2010.30 1723.03

Net Sales 19933.74 18046.77

Total Expenditure 16744.44 15457.63

Other Income 98.46 92.85

Operating Profit (PBDIT) 3287.85 2682.59

Finance Cost 459.57 305.33

Cash Profit 2828.29 2377.26

Depreciation 1053.15 910.11

Profit before Tax 1775.14 1467.15

Provision for Taxation

i) Current Year 541.35 450.00

ii) Fringe Benefit Tax - -

iii) Deferred Taxation 56.00 25.00

Net Profit / (Loss) after Tax 1177.79 992.15

Note: Figures have been re-grouped wherever necessary to confirm to current period classification.

DIVIDEND

In view of requirement of funds for the operations of the company and to meet with Capital expenditure with internal accruals and also to improve liquidity, your Directors recommend a dividend of Rs.3.50 per equity share i.e 35% for the Year Ended 31st March 2012 as against Rs.4.50 per equity share i.e. 45% in the previous year.

OPERATIONS

The Company achieved the gross turnover of Rs.21933.89 lakhs during 2011-12 as against Rs.19751.54 lakhs in the previous year 2010-11 there by an increase of growth of Rs.2182.35 lakhs i.e. 11.05% and profits to Rs.1775.14 lakhs as against Rs.1467.15 lakhs i.e.21% increase.

The company R&D expenditure is Rs.99.62 lakhs i.e. 0.50% of sales during the year to catch up with up- gradation of technology and to meet OEM's ever demanding quality and new developments requirement to improve life cycle of their product meeting Euro III norms.

The operation of the Company on the whole has been satisfactory.

Your company has posted Net turnover of Rs.19933.74 lacs as compared to Rs.18046.77 lacs for the previous year and increase of 10.46%.

Earnings Before Depreciation, Interest and Tax (PBDIT) at Rs.3287.85 lakhs as against previous year of Rs.2682.59 Lakhs an increase of 22.56%. The Profit Before Tax was at Rs.1775.14 lakhs as compared to Rs.1467.15 lakhs in 2010-11 an increase of 21%.

Management Discussion and Analysis Report

Auto Component Industry is having high growth prospects. Indian Industry is now growing as potential Global automotive supplier with very good export potential as the developing Countries comes out of recession.

The Company has very good opportunities because of valued customers both in Domestic OEM's and Replacement Market & Exports. Because of our in-time supplies, superior quality products and our technical expertise both from Japanese & German Consultants.

The Company has got very strong distribution network at their aftermarket sales because of imports from free trade zones the competition is very stiff and price sensitive.

Outlook

The Indian Auto Component Industry is going through challenges. The company continues its drive for sustainable growth in this restrained growth in Domestic and Export automotive industry.

All the cost effective steps have been taken to meet the challenges of price competition and also quality, delivery and logistics.

Segment wise performance

We operate in two segments i.e. OEM and After Market in both domestic and exports. You will find during the year 2011-12 our sales of OEM's is 42% and After Market 40% and Exports 18% of Net Sales. You will find this is well balanced; we can meet and respond to market fluctuations.

Concern & Risks

The company has taken all the steps to mitigate the following risks:

Raw material prices : Ours is a continuous high volume manufacturing industry. Our profitability will depend on change in the price in raw materials and input costs.

Foreign currency Risks: Exchange rate fluctuations may some times effect. Adequate steps taken.

Auto Industry Growth

Our Company is linked with auto industry which is very much fluctuating because of the economy and also fuel pricing and interest rates.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The company has well defined internal control systems and procedures for ensuring optimum utilization of various resources, Investment decisions involving Capital Expenditure or taken up only after due appraisal and review. Internal audit function covers and carried out periodically and reviewed by the Audit Committee to ensure that all policies and procedures are adhered to, and all statutory obligations complied with.

FINANCIAL PERFORMANCE

The Company earned total net sales revenue of Rs.19933.74 lakhs compared with Rs.18046.77 lakhs in the previous year and the operational expenses increased by 10.18% at Rs. 20267.46 lakhs compared with Rs. 18395.50 lakhs incurred last year mainly on account of steep increase in raw material cost.

Profit Before Depreciation, interest and tax (PBDIT) at Rs. 3287.85 lakhs as against Rs.2682.59 lakhs. During the year 2011-12 operating profit of net sales is 16.49% as against 14.86% in 2010-11. The Profit Before Tax was at Rs. 1777.79 lakhs as compared to Rs.1467.15 Lakhs in 2010-11 thereby an increase is 21%

HUMAN RESOURCES

The Company maintains cordial industrial relations environment and the Company continues to establish its training facilities.

The Company making to be available and encourages good talent in the rapidly challenging business and competitive environment

CAUTIONARY STATEMENT

Statements in this Management Discussion and Analysis describing the Company's objective, projections, estimates and expectations may constitute forward looking statements within the meaning of applicable laws and regulations. Actual results might differ marginally or materially from those either expressed or implied.

10 YEARS RECORD

A chart showing 10 Years performance is appended forming part of this report.

Corporate Governance

Pursuant to the provisions of the Clause 49 of the Listing Agreement a report on Corporate Governance and a certificate from the Statutory Auditors regarding the Compliance of conditions of Corporate Governance are annexed to and form part of this Annual Report. EXPORTS

The Export Turnover of Rs.3868.91 lakhs during the year as against Rs.3387.47 lakhs of the previous year because of recession in US & Europe our exports are increased by 14.21%.

The Company is focusing exports to developed Countries like Europe, U.K, France, Italy, Spain, Germany, Brazil and Russia, Colombia, Turkey, Sri Lanka, Bangladesh and Nepal etc. The Company has plans to reach 20% of the Turnover during the next 2 years.

POLLUTION CONTROL SAFETY & ENVIRONMENTAL PROTECTION

We are complying all the norms prescribed by the statutory authorities i. e. A. P. Pollution Control Board.

The Company very much concerned for safety of men and machines through safety awareness training programs.

BOARD OF DIRECTORS

Shri S Madhava Rao, Director is liable to retire by rotation at this Annual General Meeting and being eligible, offers himself for reappointment.

Dr. V Venkat Reddy, Director is liable to retire by rotation at this Annual General Meeting and being eligible, offers himself for reappointment.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 217 (2AA) of the Companies (Amendment) Act, 2000 your Directors are hereby confirmed that:

- In the participation of Annual Accounts the applicable accounting standards have been followed and that there have been no material departures.

- 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 March 31, 2012 and of the profit to the Company for the year.

- Your 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.

- That the Directors have prepared the Annual accounts on a going concern basis.

The Company's Internal Auditors have conducted periodic audit to provide reasonable assurance that the Company's established policies and procedures have been followed. The Audit Committee of the Board meets once in a quarter with Internal Auditors to review internal control and financial reporting issues. AUDITORS

M/s. Ravi & Keshav, Chartered Accountants, will retire at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. The Company has received the Certificate U/s 224 (1-B) of the companies Act, 1956 from M/s. Ravi & Keshav that their appointment, if made, would be in compliance with the provisions of said section. Relevant notes to the Accounts concerning Auditors observation there on are self-explanatory.

PARTICULARS OF EMPLOYEES

Particulars of employees required to be furnished under section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 are given in the annexed statement with forms an integral part of this report. The Company continued to have cordial and harmonious relations with its employees.

DISCLOSURE OF PARTICULARS

The information required under section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988 is given in the Annexure-1 forming part of this report.

FIXED DEPOSITS

The Company has not accepted any Deposits in terms of Sec.58 (A) of the Companies Act, 1956 and the rules made there under and hence compliance with the same as not applicable.

ACKNOWLEDGEMENTS

Your Directors wish to place on record their appreciation for the cooperation and support of Bankers, Customers, Business Associates, Shareholders, dealers, and suppliers who are enabling the Company to achieve its goals. The Directors also place on record their appreciation made by the employees at all levels.

On behalf of the Board of Directors

S.D.M. RAO

Place : Hyderabad CHAIRMAN

Date : 26.05.2012 & MANAGING DIRECTOR

---

Mar 31, 2011

DEAR SHAREHOLDERS

The Directors are pleased to present 25th Annual Report and the Audited Accounts of the Company for the year ended March 31, 2011.

Financial results

Rs. In lacs.

2010-2011 2009-2010

Gross Sales 19751.54 15033.04

Less: Excise Duty & Sales Tax 2816.10 1772.76

Net Sales 16935.44 13260.28

Total Expenditure 14437.34 11245.62

Other Income 128.96 106.24

Operating Profit (PBDIT) 2627.07 2120.90

Interest 249.80 196.67

Cash Profit 2377.26 1924.23

Depreciation 910.11 912.38

Profit before Tax 1467.15 1011.85

Provision for Taxation

i) Current Year 450.00 276.00

ii) Deferred Taxation 25.00 25.00

Profit before extraordinary item 992.15 710.85

Extraordinary Item - -

Net Profit after

extraordinary item 992.15 710.85

Add: Refund of Income Tax - -

Add: Extraordinary Item - -

Excess Depreciation - -

Less : Taxation of Previous Years - -

Add: Balance Brought forward from previous year 2391.98 2408.94

Amount Available for - -

Appropriations 3384.13 3119.79

APPROPRIATIONS

Proposed Dividend Rs.4.5 per share i.e 45% (Previous year 40%) 441.92 392.82

Tax on Proposed

Distributed Profits 75.13 66.79

Transfer to General Reserve 183.48 126.48

Balance Carried to Balance Sheet 2683.60 2533.70

TOTAL 3384.13 3119.79

Note: Figures have been re-grouped wherever necessary to confirm to current period classification.

RESERVES

12.5% of profits i.e Rs.183.48 Lacs transferred to General Reserve.

DIVIDEND

Your Directors pleased to recommend a dividend of Rs. 4.50 per equity share i.e 45% for the Year Ended 31st March 2011.

OPERATIONS:

The Company achieved the gross turnover of Rs. 19751.54 lakhs during 2010-11 as against Rs.15033.04 lakhs in the previous year 2009-10 thereby an increase of growth of Rs.4718.50 lakhs and profits to Rs.1467.15 lakhs as against Rs.1011.85 lakhs i.e. increased by Rs.455.30 lakhs over previous year.

The company R&D expenditure is 84.68 lakhs i.e., 0.50% of Net Sales during the year to catch up with up- gradation of technology and to meet OEM's ever demanding quality and new developments requirement to improve life cycle of their product meeting Euro III & Euro IV norms.

The operation of the Company on the whole has been satisfactory.

Your company has posted Net turnover of Rs. 16935.44 lacs as compared to Rs. 13260.28 lacs for the previous year.

Earnings Before Depreciation, Interest and Tax (PBDIT) at Rs.2627.07 lakhs as against previous year of Rs.2120.90 Lakhs. The Profit Before Tax was at Rs.1467.15 lakhs as compared to Rs.1011.85 lakhs in 2009-10.

Management Discussion and Analysis

A detailed discussion on the industry Structure, Development, Opportunities, Threats review of operational performance and risk factors is provided, which forms part of this report.

Corporate Governance

Pursuant to the provisions of the Clause 49 of the Listing Agreement a report on Corporate Governance and a certificate from the Statutory Auditors regarding the Compliance of conditions of Corporate Governance are annexed to and form part of this Annual Report.

EXPORTS

The Export Turnover of Rs. 3387.47 lakhs during the year as against Rs.2542.28 lakhs of the previous year increased by 33.25%.

The Company is focusing exports to developed Countries like Australia, Europe, U.K, North America and Russia. The Company has plans to reach 25% of the Turnover during the next 2 years.

POLLUTION CONTROL SAFETY & ENVIRONMENTAL PROTECTION:

We are complying all the norms prescribed by the statutory authorities i. e. A. P. Pollution Control Board.

The Company very much concerned for safety of men and machines through safety awareness training programmes.

BOARD OF DIRECTORS

Shri M.N. Thakkar, Director is liable to retire by rotation at this Annual General Meeting and being eligible, offers himself for reappointment.

Shri V Chakrapani, Director is liable to retire by rotation at this Annual General Meeting and being eligible, offers himself for reappointment.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 217 (2AA) of the Companies (Amendment) Act, 2000 your Directors are hereby confirmed that:

- In the participation of Annual Accounts the applicable accounting standards have been followed and that there have been no material departures.

- 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 March 31, 2011 and of the profit to the Company for the year.

- Your 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.

- That the Directors have prepared the Annual accounts on a going concern basis.

The Company's Internal Auditors have conducted periodic audit to provide reasonable assurance that the Company's established policies and procedures have been followed. The Audit Committee of the Board meets once in a quarter with Internal Auditors to review internal control and financial reporting issues.

AUDITORS

M/s. Ravi & Keshav, Chartered Accountants, will retire at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. The Company has received the Certificate U/s 224 (1-B) of the companies Act, 1956 from M/s. Ravi & Keshav that their appointment, if made, would be in compliance with the provisions of said section. Relevant notes to the Accounts concerning Auditors observation there on are self-explanatory.

PARTICULARS OF EMPLOYEES

Particulars of employees required to be furnished under section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 are given in the annexed statement with forms an integral part of this report. The Company continued to have cordial and harmonious relations with its employees.

DISCLOSURE OF PARTICULARS

The information required under section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988 is given in the Annexure-1 forming part of this report.

FIXED DEPOSITS

The Company has not accepted any Deposits in terms of Sec. 58 (A) of the Companies Act, 1956 and the rules made there under and hence compliance with the same as not applicable.

ACKNOWLEDGEMENTS

Your Directors wish to place on record their appreciation for the cooperation and support of Bankers, Customers, Business Associates, Shareholders, dealers, and suppliers who are enabling the Company to achieve its goals. The Directors also place on record their appreciation made by the employees at all levels.

On behalf of the Board of Directors

S. D. M. RAO CHAIRMAN & MANAGING DIRECTOR

Place: Hyderabad Date : 16.05.2011

---

Mar 31, 2010

The Directors are pleased to present 24th Annual Report and the Audited Accounts of the Company for the year ended March 31, 2010.

Financial results

Rs. In lacs. 2009-2010 2008-2009

Gross Sales 15033.04 11610.18

Net Sales 13260.28 9912.92

Total Expenditure 11245.62 8387.48

Other Income 106.24 204.11

Operating Profit (PBDIT) 2120.90 1729.55

Interest 196.67 338.26

Cash Profit 1924.23 1391.29

Depreciation 912.38 777.68

Profit before Tax 1011.85 613.61

Provision for Taxation

i) Current Year 276.00 135.33

ii) Fringe Benefit Tax - 5.00

iii) Deferred Taxation 25.00 25.00

Profit before extraordinary item 710.85 448.28

Extraordinary Item Net Profit after

extraordinary Item 710.85 448.28

Add: Refund of Income Tax

Add: Extraordinary Item - -

Excess Depreciation - 923.01

Less:Taxation of Previous Years - -(41.91)

Add: Balance brought

forward from previous year 2408.94 1500.96

Amount Available for Appropriations 3119.79 2830.34

APPROPRIATIONS

Proposed Dividend Rs. 4-00 per

share i.e @ 40% 392.82 294.62

(Previous Year 35%)

Tax on Proposed

Distributed Profits 66.79 50.08

Transfer to General Reserve 126.48 76.70

Balance carried to Balance

Sheet 2533.70 2408.94

3119.79 2830.34

Note: Figures have been re-grouped wherever necessary to confirm to current period classification.

RESERVES

12.5% of profits i.e Rs. 126.48 Lacs transferred to General Reserve.

DIVIDEND

Your Directors pleased to recommend a dividend of Rs. 4.00 per equity share i.e 40% for the Year Ended 31st March 2010.

OPERATIONS:

Despite the drop in export sales in 3rd Et 4th Quarters verses the previous year as well as drop in OEM sales due to unprecedented decline in Automotive market the Company has adopted aggressive marketing strategies in domestic and after market achieved the gross turnover of Rs.15033.04 lakhs during 2009-10 as against Rs.11610.18 lakhs in the previous year 2008- 09 there by an increase of growth of Rs.3422.86 lakhs and profits to Rs. 1011.85 lakhs as against Rs.613.61 lakhs.

The company pushed up the R&D expenditure to 99.45 lakhs i.e., 0.75% of sales during the year to catch up with up- gradation of technology and to meet OEMs ever demanding quality and new developments requirement to improve life cycle of their product meeting Euro III norms.

The operation of the Company on the whole has been satisfactory.

Your company has posted Net turnover of Rs. 13260.28 lacs as compared to Rs.9912.92 lacs for the previous year.

Earnings Before Depreciation, Interest and Tax (PBDIT) at Rs.2120.90 lakhs as against previous year of Rs.1729.55 Lakhs. The Profit Before Tax was at Rs.1011.85 lakhs as compared to Rs.613.61 lakhs in 2008-09.

Management Discussion and Analysis

A detailed discussion on the industry Structure, Development, Opportunities, Threats review of operational performance and risk factors is provided, which forms part of this report.

Corporate Governance

Pursuant to the provisions of the Clause 49 of the Listing Agreement a report on Corporate Governance and a certificate from the Statutory Auditors regarding the Compliance of conditions of Corporate Governance are annexed to and form part of this Annual Report.

EXPORTS

The Export Turnover of Rs.2542.28 lakhs during the year as against Rs.2187.12 lakhs of the previous year recession in US fit Europe our exports are increased by 16.24%.

The Company is focusing exports to developed Countries like Australia, Europe, U.K, North America and Russia. The Company has plans to reach 25% of the Turnover during the next 2 years.

POLLUTION CONTROL SAFETY & ENVIRONMENTAL PROTECTION:

We are complying all the norms prescribed by the statutory authorities i. e. A. P. Pollution Control Board.

The Company very much concerned for safety of men and machines through safety awareness training programmes.

BOARD OF DIRECTORS

Shri S Madhava Rao, Director is liable to retire by rotation at this Annual General Meeting and being eligible, offers himself for reappointment.

Dr. V Venkat Reddy, Director is liable to retire by rotation at this Annual General Meeting and being eligible, offers himself for reappointment.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 217 (2AA) of the Companies (Amendment) Act, 2000 your Directors are hereby confirmed that:

- In the participation of Annual Accounts the applicable accounting standards have been followed and that there have been no material departures.

- 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 March 31, 2010 and of the profit to the Company for the year.

- Your 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.

- That the Directors have prepared the Annual accounts on a going concern basis.

The Companys Internal Auditors have conducted periodic audit to provide reasonable assurance that the Companys established policies and procedures have been followed. The Audit Committee of the Board meets once in a quarter with Internal Auditors to review internal control and financial reporting issues.

AUDITORS

M/s. Ravi & Keshav, Chartered Accountants, will retire at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. The Company has received the Certificate U/s 224 (1-B) of the companies Act, 1956 from M/s. Ravi & Keshav. that their appointment, if made, would be in compliance with the provisions of said section. Relevant notes to the Accounts concerning Auditors observation there on are self-explanatory.

PARTICULARS OF EMPLOYEES

Particulars of employees required to be furnished under section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 are given in the annexed statement with forms an integral part of this report. The Company continued to have cordial and harmonious relations with its employees.

DISCLOSURE OF PARTICULARS

The information required under section 217(1 )(e) of the Companies Act, 1956 read with Companies .(Disclosure of particulars in the Report of the Board of Directors) Rules, 1988 is given in the Annexure-1 forming part of this report.

FIXED DEPOSITS

The Company has not accepted any Deposits in terms of Sec. 58 (A) of the Companies Act, 1956 and the rules made there under and hence compliance with the same as not applicable.

ACKNOWLEDGMENTS

Your Directors wish to place on record their appreciation for the cooperation and support of Bankers, Customers,

Business Associates, Shareholders, dealers, and suppliers who are enabling the Company to achieve its goals. The Directors also place on record their appreciation made by the employees at all levels.

On behalf of the Board of Directors S. D. M. RAO Place: Hyderabad CHAIRMAN Date : 14.05.2010 & MANAGING DIRECTOR