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Directors Report of Tata Motors Ltd.

Mar 31, 2017

The Directors present their Seventy Second Annual Report along with the Audited Statement of Accounts for Fiscal 2017.

Pursuant to the notification issued by the Ministry of Corporate Affairs on February 16, 2015 and under the Companies (Indian Accounting Standards) Rules, 2015 and other accounting principles generally accepted in India, the Company has adopted Indian Accounting Standards on April 1, 2016, with the transition date as April 1, 2015. Fiscal 2016 Financial Statements have been prepared in accordance with the recognised and measurement principles stated therein.

FINANCIAL PERFORMANCE SUMMARY

(Rs. in crores)

Tata Motors (Standalone)*

Tata Motors Group (Consolidated)

Fiscal 2017

Fiscal 2016

Fiscal 2017

Fiscal 2016

FINANCIAL RESULTS

Income from operations

49,100.41

47,383.61

2,74,492.12

2,77,660.59

Total expenditure

47,399.74

44,018.78

2,37,579.76

2,35,884.31

Operating profit

1,700.67

3,364.83

36,912.36

41,776.28

Other Income

978.84

1,402.31

754.54

885.35

Profit before interest, depreciation, amortization, exceptional item and tax

2,679.51

4,767.14

37,666.90

42,661.63

Finance costs

1,590.15

1,592.00

4,238.01

4,889.08

Cash profit

1,089.36

3,175.14

33,428.89

37,772.55

Depreciation, amortization and product development/ engineering expenses

3,423.87

2,747.49

21,318.56

20,179.55

Foreign exchange (gain)/loss (net)

(252.45)

222.91

3,910.10

1,616.88

Profit/(loss) for the year before exceptional items and tax

(2,082.06)

204.74

8,200.23

15,976.12

Exceptional Items - loss (net)

338.71

271.84

(1,114.56)

1,850.35

Profit/(loss) before tax

(2,420.77)

(67.10)

9,314.79

14,125.77

Tax expenses/(credit) (net)

59.22

(4.80)

3,251.23

3,025.05

Profit/(loss) after tax

(2,479.99)

(62.30)

6,063.56

11,100.72

Share of profit of joint ventures and associates (net)

-

-

1,493.00

577.47

Profit/(loss) for the year

(2,479.99)

(62.30)

7,556.56

11,678.19

Other comprehensive income/(loss)

95.48

85.47

(27,494.57)

3,157.46

Total Other comprehensive income/(loss) for the year

(2,384.51)

23.17

(19,938.01)

14,835.65

Attributable to:

(a) Shareholders of the Company

(20,005.94)

14,724.64

(b) Non-controlling interest

67.93

111.01

* These include the Company’s proportionate share of income and expenditure in its two Joint Operations, namely Tata Cummins Pvt Ltd and Fiat India Automobiles Pvt Ltd.

DIVIDEND

Considering the continued weak operating environment in the standalone business and in view of the losses for the year, no dividend is permitted to be paid to the Members for Fiscal 2017, as per the Companies Act, 2013 (“the Act”) and the Rules framed thereunder.

TRANSFER TO RESERVES

In Fiscal 2016, an additional amount has been transferred from retained earnings to Debenture Redemption Reserve (DRR) on outstanding Non-Convertible Debentures (NCDs) and Senior Notes (including interest accrued where applicable) of Rs.43.79 crores. Due to losses in Fiscal 2017, resulting in debit balance in retained earnings no amount has been transferred to DRR on the NCDs allotted in Fiscal 2017.

OPERATING RESULTS AND PROFITS

Fiscal 2017 has been marked by couple of ‘Black Swan’ events (like Brexit -UK decision to exit EU and Demonetization in India) having a large impact on the future course of developments. This year was marked by the way for the long awaited and transformational Goods and Service Tax (GST).

Growth of World GDP has been 3.1% in Fiscal 2016. A recovery in commodity prices has provided some relief to commodity exporters and helped in reducing the deflationary pressures. The Orgainisation of the Petroleum Exporting Countries (OPEC) ability to increase price by cutting down production has been curtailed by rising Shale gas output in US. Moreover, structural problems such as low productivity growth and high-income inequality persisted and are likely to be continued. Activity rebounded strongly in the United States in second half of calendaRs.2016 compared to weaker first half. However, output remained below potential in a number of other advanced economies, notable in the European area. The picture of emerging market and developing economies remained much more diverse. The growth rate in China was a bit stronger than expected, supported by continued policy stimulus. Activity was weaker than expected in some Latin American countries such as Brazil, whereas, activity in Russia was slightly better than expected, in part reflecting firmer oil prices.

India’s economy has grown at a strong pace in recent years owing to the implementation of critical structural reforms and lower external vulnerabilities. It has grown by 7.1% in Fiscal 2017, compared to 7.9% in Fiscal 2016 primarily because of the temporary consumption shock induced by cash shortages and payment disruptions from demonetisation. Private investment continues to remain weak due to over capacity. In order to propel the economy the government has been trying to give a thrust to the investment by allocating a higher sum towards gross fixed capital formation.

The Tata Motors Group registered a de-growth of 1.1% in income from operations to Rs.2,74,492 crores in Fiscal 2017 as compared to Rs.2,77,661 crores in Fiscal 2016, due to negative translation impact from Great British Pound (GB£) to Indian Rupee (‘) of Rs.27,686 crores and de-growth in the M&HCV segment in India was offset by higher wholesale volumes in Jaguar and Land Rover and growth in Passenger Vehicle segment in India. The consolidated EBITDA margins for Fiscal 2017 stood at 13.4%. Consequently, Profit Before Tax (PBT ) and Profit After Tax (PAT) [post share of profit of joint ventures and associates (net)] were Rs.9,315 crores and Rs.7,557 crores, respectively.

Tata Motors Limited recorded income from operations (including joint operations) of Rs.49,100 crores, 3.6% higher from Rs.47,384 crores in the previous year. Muted demand of M&HCV and LCV due to weak replacement demand, subdued freight demand from industrial segment, which took a further hit post demonetization and lower than expected pre-buying ahead of the implementation of BS-IV, resulting in lower EBITDA margins of 3.5% in Fiscal 2017 as against 7.1% in Fiscal 2016. Loss Before and After Tax (including joint operations) for Fiscal 2017 were at Rs.2,421 crores and Rs.2,480 crores, respectively, as compared to Loss Before and After Tax (including joint operations) of Rs.67 crores and Rs.62 crores, respectively in Fiscal 2016. The losses were primarily driven by less favourable market and model mix, including higher marketing expenses, depreciation and amortization and other operating cost.

Jaguar Land Rover (JLR) (as per IFRS) recorded revenues of GB£24.3 billion compared to GB£22.3 billion in Fiscal 2016, driven by higher sales volumes and weaker GB£.

Consolidated EBITDA for Fiscal 2017 at GB£3.0 billion, was marginally lower as compared to EBITDA of GB£3.1 billion for Fiscal 2016, as the higher revenue was more than offset by higher marketing, manufacturing and other operating expenses. EBIT was GB£1.5 billion in Fiscal 2017 lower than GB£1.8 billion in Fiscal 2016, due to higher depreciation and amortization which were partially offset by higher profits from the Chinese joint venture.

PBT in Fiscal 2017 was GB£1.6 billion in-line with the PBT of GB£1.6 billion in Fiscal 2016, the lower EBIT and unfavourable foreign exchange revaluation was more than offset by a favourable revaluation of commodity hedges and of GB£151 million further recoveries relating too to Tianjin fire in this year compared to GB£157 million net charge than in Fiscal 2016.

In May 2016, JLR redeemed the remaining US$84 million (GB£57 million equivalent) of the 8.125% US$ bond maturing in 2021 by exercising its call option, the majority of which was successfully tendered and redeemed in March 2015. In January 2017, JLR issued a €650 million 7-year bond with a coupon of 2.20% and a GB£300 million 4-year bond with a coupon of 2.75%. In addition, JLR successfully undertook a consent solicitation in March 2017 to align the terms of three of their older bonds to the terms of the Euro and GB£ bonds issued in January 2017.

Tata Motors Finance Limited (TMFL) (consolidated) (as per Indian GAAP) the Company’s captive financing subsidiary, reported revenue of Rs.2,721 crores (Fiscal 2016 Rs.3,229 crores) and reported a Loss After Tax Rs.1,182 crores in Fiscal 2017, as compared to PAT Rs.267 crores in Fiscal 2016.

Tata Daewoo Commercial Vehicle Company Limited South Korea (TDCV), (as per Korean GAAP) registered revenues of KRW 1,032 billion in Fiscal 2017, a growth of 17.3% over Fiscal 2016 mainly due to increase in domestic sales. The PAT was KRW 50 billion compared to KRW 46 billion in Fiscal 2016. Higher domestic volume, better mix, favourable exchange realizations and material cost reduction helped in improving profits.

VEHICLE SALES AND MARKET SHARES The Tata Motors Group sales for this year stood at 11,57,808 vehicles, up by 8.8% as compared to Fiscal 2016. Globally the Company sold 3,96,097 Commercial Vehicles and Passenger Vehicles were 7,61,711.

TATA MOTORS

Tata Motors recorded sales of 545,416 vehicles, a growth of 6.5% over Fiscal 2016. In Fiscal 2016 Industry in India, grew by 8.3%, resulting in the Company’s market share decreasing to 12.8% in Fiscal 2017 in the Indian Automotive Industry from 13.1% in the Fiscal 2016. The Company’s exports on standalone basis grew by 10.6% to 64,221 vehicles in Fiscal 2017 as compared to 58,058 vehicles in Fiscal 2016.

Commercial Vehicles

The domestic demand for Commercial Vehicles was volatile through the year, as a result of Government and Regulatory announcements - e.g. Goods and Service Tax (GST), demonetization, emissions change from BS-III to BS-IV etc. Within the domestic market, the Company sold 3,24,175 Commercial Vehicles, a marginal fall of 0.8% from Fiscal 2016. While the overall growth of Commercial Vehicles for the Company has been muted, some specific segments like M&HCV tipper (Construck), Buses and Pickup have seen strong growth during Fiscal 2017.

Some of the highlights for the year were:

- Unveiled its very first Brand Ambassador - Akshay Kumar in December.2016. He will be the face of the entire CVBU range going forward.

- The Xenon Yodha Pickup was launched in January 2017. A reliable new Pickup with high levels of performance and lower operating costs, it has been very well received and is gaining acceptance from customers.

- Launched a range of state of the art buses running on alternate fuels including Electric, Hybrid and LNG. An order foRs.25 hybrid buses to the Mumbai Metropolitan Region Development Authority is in the process of being fulfilled.

- The Magic Mantra SCV Passenger Vehicle with superior performance was launched to augment the existing Magic and Iris models in the last mile connectivity segment.

The Magna Bus Coach was introduced as the next-generation coach for inter-city people movement. Feedback on the product has been encouraging.

- In the M&HCV segment several new products were launched - Ultra 1518 truck, LPK 1615 tipper, LPT 3718 Pusher Lift Axle rigid truck and a further extension of the SIGNA range of Tractors. Offered in various configurations, the SIGNA range of Commercial Vehicles is engineered and built to offer M&HCV buyers a newly designed cabin with proven Tata Motors aggregates for a world-class trucking experience.

- Launched a refreshed version of the Tata Loyalty Program with a unique cover of Rs.10 lakhs accidental insurance for five years for the driver - a first of its kind in the industry, plus a host of benefits to enable customers to accumulate points for every spend along with many more attractive options for redeeming points accrued.

- This year, the Company won four prestigious awards at the Apollo CV Awards:

- Tata Armoured Personnel Carrier - winners of the Special CV Application of the Year award.

- MCV tipper of the Year award was won by Tata Prima 2528.K

- Tata DLT double-deck tractor (trailer) carrier won the CV application builder of the Year award

- Tata Signa 4923.S tractor won the HCV tractor cargo carrier of the Year award.

- Dealership of the Year Award- Cargo Motors Pvt. Ltd.

Dipper Campaign-Use Dipper At Night - an innovative campaign to bring awareness amongst the truck driver community for safe practices has been extremely well received and acknowledged through various awards such as the CANNES 2016 - 2 awards - a first for the TATA Group, SPIKES ASIA 2016 awards, and the EFFIES 2016 award.

- Organized the Prima Truck Racing Championship Season 4, which drew in oveRs.30,000 spectators. The highlights this year were the inclusion of FIA’s European Truck Racing Championship (ETRC) drivers in addition to the current crop of racers from the British Truck Racing Association (BTRA), the first female truck driver and an expansion of the Indian Truck Driver Racing Training Program called the “T1 Racer Program”. The T1 Racer Program (TRP) is a program started in 2016 to identify regular Indian truck drivers and train them to become racers. This is the second year of the program. This year also saw the unveiling of a 1,000 bhp truck, which will feature as the racing platform for future editions.

- In order to promote various applications on the Company’s products, a series of campaigns have been organized across the country:

- Har Business ka ACE- Fully Built expo- Pan India 34 expos covering 14,437 customers conducted to showcase the versatility of the Tata SCV platform and leverage the many applications for use by the customers. It has been well received as customers look towards buying ready to use solutions from the Company for enhancing their business.

- Construck Mahotsav - covered 13 important locations in East India with participation from more than 5,500 customers. This exclusive event to showcased the entire range of construction and mining vehicles to leverage the growing demand for such vehicles.

- Truck World in 2016-17 - Organized Truck World Exhibition with a full range of oveRs.35 different models displayed and visited by more than 13,000 customers across some of the key trucking centers in the country such as Chandigarh, Hyderabad, Guntur, Kanpur and Delhi.

- Tata 407- 30 Year Celebration - More than 35,000 customers participated in this campaign over two months. The iconic Tata 407 celebrated 30 years and it continues to be the best selling product in the category of LCV trucks. Customers across the country were felicitated for their support in making this one of the most successful brands in the Commercial Vehicle Industry.

- HAMARE BUS KI BAT HAI - This unique programme reached out to the support staff of school buses across India, helping them improve their efficiency at work.

Since it’s inception, the programme has reached out to 2,313 schools in 299 cities/towns covering oveRs.96,586 school bus staff.

Passenger Vehicles

The domestic Passenger Vehicle Industry grew by 9.6% during Fiscal 2017. Correction in fuel prices and easing financing cost has resulted in lower operating cost, which should further aid domestic growth in near to medium term. Industry sales crossed 3 million milestone for the first time during the year. The Company’s Passenger Vehicles sales were higher by 23.5% at 157,020 vehicles, registering a 5.2% market share. The Company sold 137,175 cars (higher by 28.4%) and 19,845 utility vehicles and vans, (lower by 2.2%). In the Utility Vehicle segment, competitive activity intensified with multiple new launches mainly in the soft-roader category. The Company has taken various initiatives to improve its performance such as product refreshes/launch programs, operational efficiency, dealer effectiveness, working capital management and restructuring customer facing functions.

Some of the highlights of this year’s performance were:

- Product launches continued during the Fiscal.

- Tiago was launched in April 2016, with latest technological advancements and design engineering.

- Tata Hexa was launched in January 2017, with Automatic and Manual Gearbox, new design language and class leading features.

- Tigor Compact Sedan was launched towards the end of March 2017.

The above new product launches were in-line with the Company’s objective of taking the brand to a higher level, while making it relevant for the younger buyer. The Company continued to focus on building brand strengths, refreshing products and enhancing sales and service experience. The Company expanded it’s new look, stylish, tech savvy best in class flagship Passenger Vehicle showrooms, for superior customer experience

The Company has signed a contract for supply of 3,192 units of the Tata Safari Storme 4x4 to the Indian Armed Forces, under a new category of vehicles - GS800 (General Service 800).

Exports

The Company exported 64,221 vehicles (Fiscal 2016: 58,058 vehicles) comprising 60,184 units of Commercial Vehicles and 4,037units of Passenger Vehicles during Fiscal 2017.

Export of Commercial Vehicles grew by 11.3% in Fiscal 2017 with 60,184 units exported compared to 54,052 in Fiscal 2016, crossing 60,000 shipments for the first time and the highest ever till date. The traditional markets of SAARC remained stronger than last year growing by 21.5% with Sri Lanka, Bangladesh and Nepal contributing to the growth. However, the mid-term duty change in Sri Lanka and the liquidity crisis in Nepal impacted the growth momentum. The reconstruction and the easing up of pent up demand led to record shipments to Nepal in Fiscal 2017. Low crude oil prices, Middle East geo-political situation, currency devaluations and political strife cast a big shadow over the Company’s strong markets of Middle East and Africa this year, with the exception of the newly opened market of Tunisia which grown more than 100%. The Company was able to grow market shares in the key markets of Nepal and Bangladesh. In Fiscal 2017, the Company successfully bagged and executed several prestigious orders including 553 units Xenon pickups for PoS, Malaysia; 537 units of buses to Ivory Coast as a part of their public transportation system; 25 units of Prima in Oman to Al Tasneem; 25 units of ULTRA trucks in Bangladesh to Pran RFL; 32 units of ULTRA trucks in Malaysia to PoS and 39 units of ULTRA Buses in Nepal to Mahanagar Yatayat. Some of the key events in Fiscal 2017 were the launch of Tata ULTRA Trucks in Kenya and Tanzania; ULTRA Bus in Tanzania; Tata Prima in Kingdom of Saudi Arabia and Bhutan. As a part of its strategy to expand its global footprint, the Company also launched the Commercial Vehicle brand in Vietnam and Bolivia. In Fiscal 2017, the Company achieved a key milestone of 1,000 Ultra retails in export markets.

During the period Fiscal 2017, the Company exports of Passenger Vehicles stood at 4,037 units, compared to 4,006 units in the Fiscal 2016. Sales in Sri Lanka declined considerably due to increase in import duties and tightening of retail financing. However, this was compensated by the improved sales in Nepal and South Africa with a growth of 120% and 30% respectively.

In Nepal, the launch of Tiago has helped the Company to improve its sales in the hatch segment whereas increased sales of Zest helped to gain the leadership position in the compact sedan segment. The Sumo continues to be the ‘Number One’ selling brand in UVs in Nepal. In South Africa, aggressive fleet sales push helped us to increase its sales over last year. In Bangladesh, the Company has improved its sales on account of launch of Nano GenX and an institutional order for Sumo Ambulance.

Jaguar Land Rover

In Fiscal 2017, Jaguar Land Rover achieved record retail sales of 604,009 units in Fiscal 2017 a growth of 15.8% as compared to Fiscal 2016, primarily driven by the introduction of the Jaguar F-PACE and continued strong demand for the Land Rover Discovery Sport. The retail sales were higher year-on-year in China by 32%, North America by 24%, the UK 16% and the Europe 13% in Fiscal 2017. However, retail sales were down by 6% in other overseas markets, which include Brazil, Russia and South Africa.

Some of the key highlights of Fiscal 2017:

Retail sales of the new Jaguar F-PACE commenced in May 2016 (Winner of World Car of the Year and World Car Design of the Year).

- The Jaguar XE commenced sales in the US in May 2016.

- The Range Rover Evoque convertible commenced sales in June 2016.

- Production of the new long wheel base Jaguar XFL commenced at the Chinese joint venture and went on sale locally in September2016.

- The all new Land Rover Discovery was unveiled in September2016, with sales commencing in February 2017 .

- The new Range Rover Velar was revealed to the public in March 2017 and is the 4th Range Rover model positioned between the Range Rover Evoque and the Range Rover Sport.

The Jaguar I-PACE concept, JLR’s first battery electric vehicle, was unveiled in November2016, with sales commencing in 2018.

- JLR opened it’s first wholly owned international manufacturing plant in Brazil in June 2016.

Production of JLR’s in-house 4 cylinder Ingenium petrol engine commenced in September2016 at the Engine Manufacturing Centre in Wolverhampton in the UK and is now available in the Jaguar XE, XF, F-PACE, Land Rover Discovery Sport and Range Rover Evoque. The Ingenium Petrol Engine will also be available in the new Range Rover Velar from launch.

- Construction of the manufacturing plant at Nitra in Slovakia began in September2016 and the all new Discovery would be the first vehicle to be produced at the new plant from 2018.

- Jaguar XF won the Auto Express Golden Steering Wheel award for best saloon car of 2016.

- JLR launched it’s In Motion Ventures business unit in April 2016, established to develop innovative solutions aimed at overcoming future travel and transport challenges. Investments to date include US$1 million into GoKid (a ride sharing service for schools) and SPLT (a ride sharing/car pooling platform for commuters).

Tata Daewoo Commercial Vehicle Company Limited

Tata Daewoo Commercial Vehicle Company Limited (TDCV) sold 10,317 commercial vehicles, higher by 13.2% over Fiscal 2016, mainly due to increase in domestic sales. TDCV continued the strong performance, in the domestic market in-spite of increased competition by selling 8,795 commercial vehicles, registering a growth of 25.0% compared to sales of 7,036 commercial vehicles in Fiscal 2016. The market share for both HCV and MCV Segments put together was 29.6% as compared to 31.0% in Fiscal 2016. The export market scenario was very challenging in Fiscal 2017. Factors like persistently low oil prices, local currency depreciation against the US dollar, continuing statutory regulations to reduce imports, the slowdown in Chinese economy impacting commodity exporting countries and increased dealer inventory, adversely impacted TDCV’s exports in major markets, such as Gulf Corporation Council, Russia, Algeria, Vietnam and South Africa. The export sales were 1,522 commercial vehicles, 26.8% lower compared to 2,080 commercial vehicles in Fiscal 2016.

Tata Motors (Thailand) Limited

Tata Motors (Thailand) Limited (TMTL) sold 1,332 units in Fiscal 2017, as compared to 1,312 units in Fiscal 2016. The Thai Automobile Industry has witnessed a flat growth in Fiscal 2017 afteRs.3 straight years of decline.

TMTL has taken the opportunity to refresh its products, services and network, as well as, expand the range of offerings to the Thailand Customers. Fiscal 2017 saw the launch of Super Ace Mint in Q2 of Fiscal 2017 and Ultra Trucks in later part of the year. Initial response for Ultra Truck was encouraging. During the year, TMTL exported 317 vehicles to Malaysia against specific order from PoS Malaysia. TMTL is exploring similar opportunities in other parts of South East Asia and neighbouring continents.

Tata Motors (SA) (Pty) Limited

Tata Motors (SA) (Pty) Ltd (TMSA) sold 697 chassis in the South African market in Fiscal 2017 compared to 765 chassis in Fiscal 2016 and exported 6 chassis to Mozambique during Fiscal 2017. TMSA is in the process of introducing a new range of Ultra truck and few more new models of Prima in South Africa and is exploring options to export vehicles to other African countries.

Tata Motors Finance Limited

Tata Motors Finance Limited (TMFL) is the vehicle financing arm under the brand “Tata Motors Finance.”

TMFL’s total disbursements (including refinance) increased by 3.5% at Rs.9,298 crores in Fiscal 2017 as compared to Rs.8,985 crores in Fiscal 2016. TMFL financed a total 1,18,883 vehicles reflecting an increase of 6.0% oveRs.1,12,114 vehicles financed in Fiscal 2016. Disbursements for commercial vehicles decreased by 4.8% and were at Rs.7,127 crores (77,898 units) as compared to Rs.7,485 crores (75,970 units) of Fiscal 2016 mainly due to lower disbursements in the M&HV segment. Disbursements of passenger vehicles increased by 14.3% to Rs.1,542 crores (34,126 units) from a level of Rs.1,350 crores (33,185 units). Disbursements achieved under refinance (through TMFSL, a 100% Subsidiary of TMFL) were at Rs.628 crores (6,859 vehicles) as compared to Rs.150 crores (2,959 vehicles) during Fiscal 2016.

TMFL has increased its reach by opening limited services branches (called Spoke and Collections branches) exclusively in TieRs.2 & 3 towns, which has helped in reducing the turn around time to improve customer satisfaction. TMFL had 261 branches at the end of Fiscal 2017. The book size of TMFL’s corporate lending business, which includes providing finance to TML’s Dealers and Vendors, increased by 21.4% from Rs.947 crores in Fiscal 2016 to Rs.1,150 crores in Fiscal 2017. As a part of restructuring and consolidation of financial services, the Scheme of Arrangement between TMFL and Sheba Properties Limited (Sheba), wholly owned subsidiary of TMFL, became effective on May 9, 2017. Based on the restructuring plan, TMFL has transferred its New Vehicle Finance (NVF) business to Sheba on January 31, 2017 (appointed date for transfer of assets of NVF Business).

MATERIAL CHANGES & COMMITMENT AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There are no material changes affecting the financial position of the Company subsequent to the close of the Fiscal 2017 till the date of this Report.

SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS

There are no significant material orders passed by the Regulators or Courts or Tribunal, which would impact the going concern status of the Company and its future operation. However, Members attention is drawn to the Statement on Contingent Liabilities and commitments in the Notes forming part of the Financial Statements.

RISK MANAGEMENT

The Risk Management Committee (RMC) comprising of four Independent Directors, has been entrusted with responsibility to assist the Board in (a) overseeing the Company’s risk management process and controls, risk tolerance and capital liquidity and funding (b) setting strategic plans and objectives for risk management and review of risk assessment of the Company (c) review the Company’s risk appetite and strategy relating to key risks, including credit risk, liquidity and funding risk, market risk, product risk and reputational risk, as well as the guidelines, policies and processes for monitoring and mitigating such risks.

The Committee operates as per its Charter approved by the Board and within the broad guidelines laid down in it. The Company has a Risk Management Policy in accordance with the provisions of the Act and SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015 (“SEBI Listing Regulations”). It establishes various levels of accountability and overview within the Company, while vesting identified managers with responsibility for each significant risk. The Board takes responsibility for the overall process of risk management in the organisation. Through Enterprise Risk Management programme, business units and corporate functions address opportunities and the attendant risks through an institutionalized approach aligned to the Company’s objectives. This is facilitated by internal audit. The business risk is managed through cross functional involvement and communication across businesses. The results of the risk assessment are thoroughly discussed with the Senior Management before being presented to RMC.

INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENT

Details of internal financial control and its adequacy are included in the Management Discussion and Analysis Report, which forms part of this Report.

HUMAN RESOURCES

The Tata Motors Group employed 79,558 permanent employees (Fiscal 2016: 76,598 employees) as of Fiscal 2017 and the Company employed 26,035 permanent employees (Fiscal 2016: 26,569 employees) as of Fiscal 2017. The Tata Motors Group has generally enjoyed cordial relations with its employees and workers.

The Company has labour unions for operative / worker grade employees at all the plants across India, except the Dharwad Plant. The labour union at Sanand Plant has recently been registered and the first settlement is yet to be done. The Company has generally enjoyed cordial relations with its employees and unions at its factories and offices and has received union support in the Company’s implementation of reforms that impact safety, quality, cost erosion and productivity improvements across all locations. Employee wages are being paid in accordance with wage agreements that have varying terms (typically three to four years) at different locations. With an objective of improving Organizational Effectiveness, the Company decided to undertake a structure change exercise with key guiding principles of Empowerment to the Business Units with clear accountability for business results, strong functional leadership and oversight for an effective maker-checker concept, improved and speedier decision making, agility and quick responsiveness to market, and strong cross functional alignment to drive quick issue resolution. A new product line organization has been created with complete Profit & Loss responsibility.

Organisational restructuring has delayered the organization to 5 managerial levels below ExCom. This has made the organization lean and agile. The Company has also rationalized span of control of key roles, providing scope for career development and have significantly increased customer facing roles in both the BUs to enhance customer centricity in the organization. Transactional roles have been identified across functions for transition to shared services, and therefore focus on core activities.

Volumetric study has been performed to identify optimum manpower at each level, bringing the organizational spread closer to global standards. This, combined with the Job Evaluation exercise and Management Audit helped in establishing clear job descriptions for each role and identifying the right talent for the roles.

The Executive Committee conducted a thorough assessment of potential candidates for the top 2/3 levels in the organisation. The assessment results were used for placement of the candidates, which was followed up with ‘on boarding’ workshops and Astronaut Trainings to prepare the management teams for the new responsibilities.

In order to create a mind-set free of job titles and hierarchy, the concept of designations has been abolished and individuals will carry the title of their functional role. After market benchmarking, revised Compensation & Policies have been rolled-out. The new terms and conditions of employment has been shared with the employees through individual letters by respective managers.

For a smooth transition, a transition team has been developed to lead the change management process, supported by continuous communications from the leadership team.

Prevention Of Sexual Harassment

The Company has zero tolerance for sexual harassment at workplace and has adopted a Policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. The Company is committed to providing equal opportunities without regard to their race, caste, sex, religion, colour, nationality, disability, etc. All women associates (permanent, temporary, contractual and trainees) as well as any women visiting the Company’s office premises or women service providers are covered under this Policy. All employees are treated with dignity with a view to maintain a work environment free of sexual harassment whether physical, verbal or psychological.

During the Fiscal 2017, the Company had received four complaints on sexual harassments, which have been substantiated and appropriate actions were taken. The Company organized 137 workshops and awareness program against sexual harassment. There were no complaints pending for more than 90 days during the year.

Similar initiatives on Prevention of Sexual Harassment are in place across the Tata Motors Group of companies.

Safety & Health - Performance & Initiatives

The Company is committed to provide a safe and healthy working environment for its employees and associates to ensure a high degree of safety norms. The Company continously strives to perform beyond compliance whilst positively influencing its value chain members to improve their safety standards. There is an increased focus on areas like training and awareness, safety observations, audits etc. to drive a positive safety culture.

The Company’s India operation, whilst achieved improved performance with Total Recordable Case Frequency Rate (TRCFR) being 1.84 against the target of 1.96 for the Fiscal 2017, the overall Safety Performance improved but recorded four fatalities during the year, of which three were road related.

Manufacturing Plants across the country are certified to ISO 14001 - Environment Management Systems and OHSAS 18001 -Occupational Health & Safety Management System, along-with Warehouses Safety Infrastructure upgraded and certification of OHSAS 18001 for a warehouse was also accomplished during Fiscal 2017. All the Company’s Manufacturing Plants across India are certified to ISO 50001 - Energy Management System too. The Company has undertaken several initiatives for resource conservation such as re-cycling of treated effluents back to process, energy, material recovery and co-processing from hazardous wastes through cradle to grave waste management principles and rainwater harvesting. Manufacturing plants also generate in-house renewable power and source off-site green power where available. Except Sanand, all the Company’s sites are certified for GreenCo.

The Company places equal emphasis on safety processes, behavioral safety and strive to create a positive safety culture towards achieving the ultimate goal of ‘zero injury’. Safety is a primary focus area in daily management and safety parameters are part of the scorecard for Senior Leaders. In same lieu ‘SAFE20 - 20 minutes for Safety,’ the company’s initiative on engagement in Safety. Sessions on Road Safety were conducted at 9 offices across India engaging tunes of 1,000 employees along with mentoring of Flexi Work Force under “MY BUDDY” program by Permanent Blue Collar Work force / Group leaders.

In line with Safety and Health Policy, to enhance safety standards of its business partners, Company engaged its upstream and downstream supply chain in the safety journey. The objective of such engagement is to raise the safety standards at Suppliers and Dealer workshops. In addition to existing 16 safety standards, new standards / guidelines like Cell Phone Policy, CCTV Policy, Lone Working Standard, Industrial Hygiene Standard, Engineering Standards, Vehicle Usage & Replacement Guidelines were developed and rolled out to raise the level of safety.

The Company continued Campaign ‘i-drive safe’ - an initiative on building a safe driving culture amongst its employee and associates and have trained them in defensive driving. In excess of 19,103 employees and associates till date have been trained under this campaign, initiated few years ago. ‘My Road My Discipline’ a Road Safety Week campaign during January 11 to 17 included Road Safety Celebrations conducted in all location including all plants, offices, dealerships, warehouses, vendors and social awareness messages were aired on FM on road safety in Indian 8 cities.

‘senSHEtize’- A Company’s initiative on Women’s Safety Awareness: 950 women employees were trained with focus on Women’s Safety and Self-defense in 14 session across offices & plants.

Jagruti - Safety Awareness Building Campaign for Workshop Managers is a year-long campaign focused on building awareness on safety and understanding of the Company’s expectations on Dealers Workshop Safety. This programme is in collaboration with the Company, Castrol and training partner ICECD. Jagruti Safety Awareness campaign was initiated done for channel partners-PV & CV dealers covering around 1,800 workshop pan-India.

In health area, the Company under the ‘Health Plus because you matter!’ initiative engaged employees on various subject of health. Health & well-being of aging workforce remains a prime concern. Various health programs across all locations with emphasis on contract employees- eye checkup of drivers, stress management, mailers, etc. have been conducted under this initiative.

For Food Safety, Pune Plant was accredited with HACCP Certification (ISO 22001) and rest of the plants shall be implementing in a phased manner.

In accordance with the Company’s stand on protecting the planet, the Company took a number of initiatives to reduce its Green House Gases footprint by 3% over Fiscal 2016. Similarly, in the Company’s quest to go on renewable energy the Company used 75 million units of renewable electricity in its operations, which is close to 17% of its requirement. On the Company’s journey to ZWTL (Zero Waste To Landfill), it reduced hazardous waste to landfill / incineration by approx. 30% over Fiscal 2016.

On Sustainability, supply chain sustainability was one of the major initiatives undertaken. 50 suppliers have been trained and assessed to sustainability expectations. Handholding of those suppliers is being done to improve the sustainability performance.

Circular economy, natural capital evaluation of key dependencies, design for environment, biodiversity assessment, life cycle assessment of products, climate adaptation study were some of the other initiatives the Company has taken in sustaining its business and planet.

JLR, the Company’s subsidiary continues to drive health and safety through Destination Zero - A Journey to Zero Harm.

The Company’s commitment is reflected in the JLR commitment ‘Blueprint for Lasting Success’ with the key statement being “Our most valuable asset is our people, nothing is more important than their safety and well-being. Our co-workers and families rely on this commitment. There can be no compromise”. Activities to deploy this ambition, promote awareness with each one of at JLR, encouraged to understand and take responsibility for its own and fellow colleague’s safety and well-being. Various Zero Harm programs, publications and events have contributed to improved performance in Fiscal 2017 and additionally each functional area has built their own plan of activities to lead improved safety and well-being within their own area of responsibility. Lost Time Case performance has continued an improving trend with an overall business improvement of around 6% Y-O-Y, against a backdrop of continued growth and increased volumes and headcount. A notable improvement was seen in manufacturing locations with oveRs.20% improvement against last Fiscal performance. Many of the sites celebrated zero lost time accidents.

The business has gone through OHSAS 18001 - recertification in Fiscal 2017, with all the UK locations accredited to this standard through a series of external assessments. Further locations have now been added to the assessment portfolio. The business has also maintained the internal safety assessment process SHARP (Safety and Health Assessment Review Process) within its manufacturing locations and has now extended a version into non-manufacturing locations. JLR also continues to mature its approach to well-being activities with a number of targeted events over the past year and specific well-being focus and topics planned for the coming year.

TMSA sustained good performance in areas of Safety and Health during Fiscal 2017. In June 2016, TMSA successfully cleared audit inspection for Occupational Hygiene against the requirements of the OHSAS.

TDCV Korea achieved an improvement in Safety Index to 0.91 from 1.33 in Fiscal 2017.

TMTL, Thailand continued leadership commitment and engagement with focus in areas safety communication, risk assessment, improving capabilities of employees for emergency situations.

BUSINESS RESPONSIBILITY REPORT

Pursuant to Regulation 34(2)(f) of the SEBI Listing Regulations, the Business Responsibility Report (BRR) initiatives taken from an environmental, social and governance perspective, in the prescribed format is available as a separate section of the Annual Report and also hosted on the Company’s website www.tatamotors.com.

FINANCE

During the year, the free cash flows for Tata Motors Group were ‘(268) crores, post spend on capex, design and development of Rs.30,467crores. Tata Motors Group’s borrowing as at March 31, 2017, stood at Rs.78,604 crores (as at March 31, 2016: Rs.69,360 crores). Cash and bank balances and investments in mutual funds stood at Rs.51,119 crores (as at March 31, 2016: Rs.49,693 crores). The consolidated net automotive debt to equity ratio stood at 0.15 as at March 31, 2017, as compared to (0.01) as at March 31, 2016.

The cash flows from operations were positive Rs.1,381 crores for standalone operations (including joint operations) of the Company. Spend on capex, design and development was Rs.3,427 (net). The borrowings of the Company (including joint operations) as at March 31, 2017 stood at Rs.19,574 crores (as at March 31, 2016: Rs.16,473 crores). Cash and bank balances including mutual funds stood at Rs.2,687 crores (as at March 31, 2016: Rs.2,534 crores).

The Company, in February 2017 prepaid Rs.300 crores of its Unsecured 8.60% NCD due in 2018. During the year the Company raised Rs.2,700 crores of funds through Unsecured NCDs.

At JLR, post spend on capex, design and development of GB£3,065 million (Rs.26,869 crores), the free cash flows were GB£295 million (Rs.2,586 crores) for Fiscal 2017. The borrowings of JLR as at March 31, 2017, stood at GB£3,581 million (Rs.28,977 crores) [previous year: GB£2,500 million (Rs.23,863 crores)]. Cash and financial deposits stood at GB£5,487 million (Rs.44,400 crores) [previous year: GB£4,651 million (Rs.44,395 crores)]. Additionally, JLR has undrawn committed long term bank lines of GB£1,870 million (JLR data as per IFRS).

During the Fiscal, JLR issued a €650 million bond maturing in 2024 paying an annual coupon of 2.200%. Subsequently, JLR issued a GB£300 million bond maturing in 2021 paying an annual coupon of 2.750%.

During the Fiscal, TMFL has neither raised any borrowings by way of unsecured, subordinated perpetual non-convertible debentures towards TieRs.1 and TieRs.2 Capital nor by way of an issue of unsecured, subordinated non-convertible debentures towards TieRs.2 Capital. Tata Motors Group has undertaken and will continue to implement suitable steps for raising long term resources to match fund requirements and to optimise its loan maturity profile.

During the year, the Company’s rating for foreign currency borrowings was upgraded to “Ba1”/Stable by Moody’s and to “BB ”/ Stable by Standard & Poor’s. For borrowings in the local currency, the ratings was retained by CRISIL at “AA” with a change in outlook to Positive and by ICRA at “AA” with a change in outlook to Positive. The NonConvertible Debentures and Long Term Bank facilities i.e. (Buyers Credit) rating by CARE was retained at “AA ”. During the year, JLR’s rating was upgraded by Moody’s at “Ba1”/Positive and was upgraded by Standard & Poor’s at “BB ”. For TMFL, CRISIL has maintained its rating on long-term debt instruments and bank facilities to CRISIL “AA/A1 ”/with a change in outlook to Positive for long term. ICRA has also maintained its rating at “AA/A1 ” with a change in outlook to Positive for long term. CARE has given rating of”AA ” on long-term debt instruments with a Stable outlook.

FIXED DEPOSITS

The Company has not accepted any public deposits during Fiscal 2017. There were no over dues on account of principal or interest on public deposits other than the unclaimed deposits as at the end of Fiscal 2017.

EXTRACT OF ANNUAL RETURN

As provided under Section 92(3) of the Act, the details forming part of the extract of the Annual Return in Form MGT 9 is annexed as Annexure - 1.

INFORMATION TECHNOLOGY AND DIGITAL PRODUCT DEVELOPMENT INITIATIVES

Information Technology Initiatives

The Company has been a pioneer in adopting Information Technologies to enable business processes and deploying efficient & secure information technology. The Company has been working towards implementing the components of its IT roadmap to create a digital ready organization. The Company leverages its strong partnerships with product and services companies to harness the potential of Information Technology towards competitive advantage. The major highlights from IT at the Company are:

Major technology upgrades undertaken in the ERP, CRM, analytics systems to make the systems current and leverage new versions’ mobile friendly capabilities.

- Enabling World Class Quality initiative of the Company through extending the implementation of Manufacturing Execution System.

- Completed multiple Proof of Concepts in the area of internet of things for smart manufacturing.

Digital initiatives like mobile backend and smart e-guru mobile app along with digital product demonstration capabilities for dealer’s sales force for effective lead generation.

- Focus on Supplier Relationship Transformation (SRT) through implementation of supplier systems and inauguration of SRT training centre.

- Continued greater collaboration with subsidiaries leveraging IT leadership in the Company.

- Strengthening information security through multiple initiatives such as Network Access Control and preparation for IS027000 framework.

With the readiness of the Company’s systems on the digital front, it is entering an exciting phase of transformation using cutting edge technology to provide customer centric products and services.

Digital Product Development Systems Initiatives

The Company, in its constant endeavor to improve processes in product design and manufacturing planning domain, has implemented various new processes and improved existing manual process by converting them to digital.

Direct business benefits, in terms of reduction in time, effort, cost and improved control, quality were achieved through various initiatives, some of which are listed below:

- 30 new knowledge based engineering applications designed and implemented across various product design and safety domains. They were integrated with various tools such as tyre life enhancement for heavy commercial vehicles, exterior trims safety for passenger vehicles, ensuring its validation in virtual environment, thereby reducing the number of physical prototypes.

- Specific Mobility Application developed to enable value based selling at CV dealerships and were deployed at 10 locations across India.

- Product Lifecycle Management (PLM) System Infrastructure was refreshed at Pantnagar and Lucknow locations.

- New innovative Visual Analytics and Reporting framework for applications was deployed for PLM based data and 4 specific applications were implemented for product development teams.

- Augmentation of High Performance Computing (HPC) Infrastructure to execute and deliver faster simulation results for product development (productivity improvement). This enabled more design optimization studies during concept and product development phase (capacity enhancement), thus reducing dependence on costly proto-parts & physical testing.

- 16 customized automation tools provided into CAE domain to increase CAE pre-post processing productivity for durability, crash, CFD and NVH functions.

- In the digital manufacturing domain, MOST (Maynard Operations Sequence Technique) was implemented on the shop floor at various manufacturing locations.

Subsidiaries Jaguar Land Rover:

JLR continue to develop the use of the latest Product Lifecycle Management (PLM) technologies to ensure JLR remains at the cutting edge of engineering and drive efficiencies into the process. The application of leading visualisation and systems engineering technologies enable full engagement in the product creation process, all with the aim of producing cars and SUVs that the customers will love for life.

Tata Daewoo Commercial Vehicle:

TDCV continued the focus on quality and agility in its digital product creation processes. PLM software system was upgraded to a higher version giving enhanced features. The PLM processes were also improved, considering various business requirements and scenarios.

Tata Technologies Limited (TTL):

TTL has invested in new technologies and practices both on software and hardware front with strong focus on its business goals and customer requirements. The digital tools and systems continue to be enhanced and upgraded as per customer needs. It continued its new technology evaluation process to support the delivery teams with effective and optimal hardware systems.

TTL invested to enhance the capacity of the High Performance Computing setup to address growing needs of simulation by augmenting its processing power with latest hardware. It extended the Virtual Desktop Infrastructure setup to support few delivery teams to provide them with scalable infrastructure that caters to their requirements on multiple operating environments and also provide them with flexible and controlled access to it from anywhere. TTL leveraged the high performance and high availability computing for enterprise applications and has invested in latest technologies for data center upgrade.

Tata Motors European Technical Centre (TMETC):

TMETC continued the use of best in class hardware and software systems to enhance quality and agility in its product conceptualization, design and virtual validation domain. Knowledge Based Engineering Applications were implemented in the engineering and design areas.

TECHNOLOGY AND ENVIRONMENT FRIENDLY INITIATIVES:

The Company is aiming towards meeting upcoming emission regulations by multifaceted approach of adapting cleaner technologies for internal combustion engines and by working on new technologies in the domains of xEVs, Hybrids and Fuel Cell. The Company intends to reduce the emissions from vehicles through various power train as well as vehicle level measures. Some of the key initiatives in this direction are mentioned below:

- Fuel efficiency improvement in diesel SCVs by implementation of fuel control unit based FIE system on twin cylinder turbo diesel engine.

- Better emission control for SCVs having two cylinder NA common rail BS-IV engine.

- Multi operation mode (economy & normal torque mode) for better fuel economy & drive ability on commercial vehicles fueled with CNG.

- Fuel efficiency improvement in diesel passenger car by engine downsizing (30% engine displacement reduction), friction reduction in piston ring pack and implementing multiple drive modes.

- Various full electric vehicles ranging from SCV to 12m buses are being developed to address last mile transport and passenger commute in ecologically sensitive areas.

Series hybrid bus with New Gen 5L BS-IV diesel engine developed and serialized; the vehicle has substantially superior fuel economy over baseline diesel vehicle.

- The fleet of Fuel Cell bus for demonstration is being built, and two fuel cell buses are under testing.

CONSOLIDATED FINANCIAL STATEMENT

The Company announces its Consolidated Financial Statement on a quarterly basis. As required under the SEBI Listing Regulations, the Consolidated Financial Statement of the Company and its subsidiaries, prepared in accordance with Ind AS 110 issued by the Institute of Chartered Accountants of India, form part of the Annual Report and are reflected in the Consolidated Financial Statement of the Company. Pursuant to Section 129(3) of the Act, a statement containing the salient features of the financial statement of the subsidiary companies is attached to the financial statement in Form AOC-1. The Company will make available the said financial statements and related detailed information of the subsidiary companies upon the request by any member of the Company or its subsidiary companies. These financial statement will also be kept open for inspection by any member at the Registered Office of the Company and the subsidiary companies.

Pursuant to the provisions of section 136 of the Act, the financial statement of the Company, Consolidated Financial Statement along with relevant documents and separate audited accounts in respect of subsidiaries are available on the website of the Company.

SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company has 78 subsidiaries (14 direct and 64 indirect) as at March 31, 2017, as disclosed in the accounts.

During the year, the following changes have taken place in subsidiary companies:

Subsidiary companies formed/acquired:

- Jaguar Land Rover Colombia S.A.S was incorporated with effect from August 22, 2016

- In Motion Ventures 1 Limited was incorporated with effect from October25, 2016

- In Motion Ventures 2 Limited was incorporated with effect from October25, 2016

- In Motion Ventures 3 Limited was incorporated with effect from October25, 2016

Companies ceasing to be subsidiary companies / ceased operations:

- JDHT Limited dissolved with effect from December.27, 2016

- Silkplan Limited dissolved with effect from January 17, 2017

- Tata Technologies (Canada) Inc. dissolved with effect from December.13, 2016

Name changes

- Jaguar Land Rover Automotive Trading (Shanghai) Company Limited was renamed as Jaguar Land Rover (China) Investment Co. Limited with effect from November1, 2016

- Cambric Manufacturing Technologies (Shanghai) Company Limited was renamed Tata Manufacturing Technologies (Shanghai) Limited with effect from February 22, 2017

Re-structuring

The Scheme of Arrangement between Tata Motors Finance Limited and Sheba Properties Limited, subsidiaries of the Company, was approved by the Hon’ble National Company Law Tribunal effective from May 9, 2017. Besides the above, JLR continued to integrate / restructure legal entities for manufacturing and for exporting globally as combined brand legal entities. Other than the above, there has been no material change in the nature of the business of the subsidiary companies.

Associate Companies

As at March 31, 2017, the Company has 8 associate companies and 7 joint ventures. One of these joint ventures has 14 wholly owned subsidiaries and details of the same are disclosed in the accounts. The Company has adopted a Policy for determining Material Subsidiaries in line with Regulation 16 of the SEBI Listing Regulations. The Policy, as approved by the Board, is uploaded on the Company’s website (URL: www.tatamotors.com/investors/pdf/material.pdf).

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

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Act, read along with Rule 8 of the Companies (Accounts) Rules, 2014, is annexed as Annexure - 2.

CORPORATE GOVERNANCE

At the Company we constantly strive to evolve and follow up on the Corporate Governance guidelines and best practices. Our purpose has always been transparency, long term shareholder value and respect to the minority shareholders. The Company discloses timely and accurate information regarding its operations and performance.

During the second half of the year under review the Company witnessed leadership change at Tata Sons (our promoter). During this period there were allegations made regarding the ethics and governance of the Company. Clarifications were also sought by the Regulators with respect to certain business decisions and governance processes. The Company would like to categorically deny the references and would like to impress upon you that it has robust systems and processes in place to ensure compliance to all regulatory requirements. The Company’s Board exercises its independence both in letter and in spirt. The Directors have always acted in the best interest of the Company and will continue to do so.

The Board closely monitored the events during this period and allegations made. The Audit Committee of the Board reviewed all the issues that were brought up including correspondence between the Regulators and the Company on the issues raised in the representations made by Mr Cyrus P Mistry and Mr Nusli Wadia in terms of Section 169 of the Act and allegations made in this regard in the proceedings before the National Company Law Tribunal initiated against our Promoter. The Company has filed responses to the Regulators denying all such allegations. In such responses, the Company has reiterated that the Company is in compliance of the governance processes and requirements in all such cases. The Committee reviewed the various compliances and disclosures and the rigour applied when strategic decisions were taken and the detailed responses to the Regulators by the Company denying such allegations. After due deliberations with relevant officials and review of relevant documents and on the basis of a detailed review of these by a reputed independent Legal Counsel, the Committee expressed its confirmation of the responses by the Company to the Regulators. It follows that the aforesaid allegations against your Company and its governance were incorrect and such statements were made without exercising proper care.

A separate section on Corporate Governance and the certificate from the Practicing Company Secretary confirming compliance of Corporate Governance norms as stipulated in Regulation 34 read along with Schedule V of the SEBI Listing Regulations, giving information pertaining to the Board, Committee of the Board and other details of relevance forms part of this Report.

DIRECTORS

Appointment

The Company has, on the recommendation of Nomination & Remuneration Committee (NRC) and in accordance with provisions of the Act and SEBI Listing Regulations, appointed Mr Natarajan Chandrasekaran (DIN: 00121863) as Additional Director and Chairman of the Board with effect from January 17, 2017 and Mr Om Prakash Bhatt (DIN: 00548091) was appointed as Additional and Independent Director, for a tenure of 5 years on May 9, 2017, subject to approval of Members at the forth coming Annual General Meeting (AGM) of the Company. They shall hold office as Additional Directors upto the date of the AGM and are eligible for appointment as Directors.

As reported in the previous year, Mr Guenter Butschek was appointed as Chief Executive Officer and Managing Director of the Company for a term of 5 years w.e.f. February 15, 2016. The Members have vide Special Resolution passed at the AGM held on August 9, 2016 approved of the said appointment and payment of minimum remuneration in case of inadequacy of profits or no profits in any financial year. An application to the Central Government has been filed by the Company and the approval is awaited.

Re-appointment

In accordance with provisions of the Act and the Articles of Association of the Company, Dr Ralf Speth (DIN: 03318908) is liable to retire by rotation and is eligible for re-appointment.

The disclosures required pursuant to Regulation 36 of SEBI Listing Regulations are given in the Notice of the AGM, forming part of the Annual Report and disclosure pursuant to Schedule V, Part II, proviso of Section II B(iv)IV of the Act and Schedule V of the SEBI Listing Regulations is disclosed in the Corporate Governance Report, forming part of the Annual Report.

Attention of the Members is invited to the relevant item in the Notice of the AGM and the Explanatory Statement thereto.

Cessation

Mr Cyrus P Mistry, Non-Executive Director and Chairman, (DIN: 00010178) (resigned with effect from December.19, 2016. Based on the requisition of Tata Sons Limited, the shareholders at the Extraordinary General Meeting of the Company held on December.22, 2016 voted in favour of removal of Mr N N Wadia as an Independent Director (DIN: 00015731) Mr Wadia ceased to be a Director of the Company with effect from December.22, 2016.

Mr Subodh Bhargava, Independent Director, (DIN: 00035672) retired on March 29, 2017 on attaining the age of 75 years, in accordance with Governance Guidelines on Board Effectiveness.

The Board places on record their appreciation for the contribution of these Directors during their tenure.

Independent Directors

All Independent Directors of the Company have given 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 and Regulation 16 of the SEBI Listing Regulations.

KEY MANAGERIAL PERSONNEL

The Key Managerial Personnel (KMPs) of the Company during Fiscal 2017 are:

- Mr Guenter Butschek, Chief Executive Officer and Managing Director

- Mr Ravindra Pisharody, Executive Director (Commercial Vehicles)

- Mr Satish Borwankar, Executive Director (Quality)

- Mr C Ramakrishnan, Group Chief Financial Officer

- Mr Hoshang Sethna, Company Secretary

During the year, there was no change in the KMPs of the Company. GOVERNANCE GUIDELINES

During the year under review, the Company adhered to the Governance Guidelines on Board Effectiveness. The Governance Guidelines cover aspects related to composition and role of the Board, Chairman and Directors, Board diversity, definition of independence, Director term, retirement age and Committees of the Board. It also covers aspects relating to nomination, appointment, induction and development of Directors, Director remuneration, Subsidiary oversight, Code of Conduct, Board Effectiveness Review and Mandates of Board Committees.

Selection and procedure for nomination and appointment of Directors

The NRC is responsible for developing competency requirements for the Board based on the industry and strategy of the Company. The Board composition analysis reflects in-depth understanding of the Company, including its strategies, environment, operations, financial condition and compliance requirements.

The NRC conducts a gap analysis to refresh the Board on a periodic basis, including each time a Director’s appointment or re-appointment is required. The Committee is also responsible for reviewing and vetting the CVs of potential candidates vis-a-vis the required competencies, undertake a reference and due diligence and meeting potential candidates, prior to making recommendations of their nomination to the Board. At the time of appointment, specific requirements for the position, including expert knowledge expected, is communicated to the appointee.

Criteria for Determining Qualifications, Positive Attributes and Independence of a Director

The NRC has formulated the criteria for determining qualifications, positive attributes and independence of directors in terms of provisions of Section 178 (3) of the Act and Regulation 19 read along with Schedule II of SEBI Listing Regulations, which is annexed as Annexure - 3.

REMUNERATION POLICY

The Company has in place a Remuneration Policy for the Directors, Key Managerial Personnel and other employees, pursuant to the provisions of the Act and Regulation 19 of SEBI Listing Regulations, the same is annexed as Annexure - 4.

BOARD EVALUATION

The annual evaluation process of the Board of Directors (“Board”), Committees and individual Directors was carried out in the manner prescribed in the provisions of the Act, Guidance Note on Board Evaluation issued by Securities and Exchange Board of India on January 5, 2017 and as per the Corporate Governance requirements prescribed by SEBI Listing Regulations.

The performance of the Board, Committees and individual Directors was evaluated by the Board seeking inputs from all the Directors. The performance of the Committees was evaluated by the Board seeking inputs from the Committee Members. The “NRC” reviewed the performance of the individual Directors, a separate meeting of Independent Directors was also held to review the performance of Non-Independent Directors; performance of the Board as a whole and performance of the Chairperson of the Company, taking into account the views of Managing Director / Executive Directors and Non-Executive Directors. This was followed by a Board meeting that discussed the performance of the Board, its Committees and individual Directors.

The criteria for performance evaluation of the Board included aspects like Board composition and structure; effectiveness of Board processes, information and functioning, etc. The criteria for performance evaluation of Committees of the Board included aspects like composition and structure of the Committees, functioning of Committee meetings, contribution to decision of the Board, etc. The criteria for performance evaluation of the individual Directors included aspects on contribution to the Board and Committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, integrity etc. In addition, the Chairman was also evaluated on the key aspects of his role.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

The details of the Familiarisation Programme for Independent Directors with the Company in respect of their roles, rights, responsibilities in the Company, nature of the industry in which Company operates, business model of the Company and related matters are put up on the website of the Company at (URL:www.tatamotors.com/investors/ pdf/familiarisation-programme-independent-directors.pdf).

VIGIL MECHANISM

The Company has adopted a Whistle Blower Policy establishing vigil mechanism, to provide a formal mechanism to the Directors and employees to report their concerns about unethical behaviour, actual or suspected fraud or violation of the Company’s Code of Conduct or ethics policy. The Policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee. The policy of vigil mechanism is available on the Company’s website at (URL: www.tatamotors.com/ investors/pdf/whistle-blower-policy.pdf).

PARTICULARS OF EMPLOYEES

Disclosure pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed to the Report as Annexure - 5.

The statement containing particulars of top 10 employees and the employees drawing remuneration in excess of limits prescribed under Section 197 (12) of the Act read with Rule 5 (2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided in a seperate Annexure forming part of the Report. In terms of proviso to Section 136(1) of the Act, the Report and Accounts are being sent to the shareholders excluding the aforesaid Annexure. The said statement is also open for inspection at the Registered Office of the Company. Any member interested in obtaining a copy of the same may write to the Company Secretary.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

The brief outline of the Corporate Social Responsibility (CSR) Policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out in Annexure - 6 of this Report in the format prescribed in the Companies (CSR Policy) Rules, 2014. The Policy is available on Company’s web-site at (URL: www.tatamotors. com/investors/pdf/csr-policy-23july14.pdf).

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS BY THE COMPANY

The details of Loans, Guarantees or Investments made during Fiscal 2017 are given below:

Rs. in crores

Companies

Nature of Transaction

Loans

Investments

Tata Marcopolo Motors Limited

Inter-corporate deposits

10.00

Tata Motors European Technical Centre Plc

Investment in loans/ shares

34.39

139.08

Concorde Motors India Limited

Compulsory Convertible Debentures with a call option to TML

$

Notes:

$ Concorde Motors has issued CCD of Rs.78 crores to TMFL. The call option is available with the Company to acquire the CCDs from TMFL.

- During Fiscal 2017, the Company has given no Guarantee to any of its subsidiaries, joint ventures and associate companies

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All contracts/ arrangements/ transactions entered by the Company during the year with related parties were on an arms’ length basis, in the ordinary course of business and were in compliance with the applicable provisions of the Act and SEBI Listing Regulations. The prior approval of the Audit Committee was sought for all related party transactions. The Company has adopted a Policy on Related Party Transactions which even provides for the parameters to grant Omnibus Approval(s) by the Audit Committee and is available on the website at (URL:www.tatamotors.com/investors/pdf/rpt-policy.pdf). A statement on related party transactions specifying the details of the transactions, pursuant to each omnibus approval granted, have been placed on a quarterly basis for review by the Audit Committee.

During the Fiscal 2017, there have been no related party transactions of the Company with its Directors and Key Managerial Personnel or their relatives, its holding, subsidiary or associate companies as prescribed under Section 188 of the Act and SEBI Listing Regulations. Also there are no material transactions with any related party that are required to be disclosed under Form AOC-2.

AUDIT

Statutory Audit

In the 69th Annual General Meeting held on July 31, 2014, M/s. Deloitte Haskins & Sells LLP, (DHS), Chartered Accountants (ICAI Firm Registration No. 117366W/W-100018) was re-appointed as Statutory Auditors of the Company for a tenure of 3 year, subject to ratification of their appointment by Members at every subsequent AGM. DHS tenure of 3 year as Statutory Auditors concludes at this ensuing AGM.

The report of the Statutory Auditors is enclosed to this Report and contains no qualification, reservation or adverse remark. The observations made in the Auditors’ Report are self-explanatory and therefore do not call for any further comments.

The Board of Director of the Company has on the recommendation of the Audit Committee and a per Section 139 of the Act it is proposed to appoint M/s B S R & Co. LLP, Chartered Accountants (B S R LLP) (ICAI Firm No. 101248W/W - 100022) for a tenure of 5 year, to hold office from the conclusion of the ensuing AGM till the conclusion of the 78th AGM of the Company to be held in the yeaRs.2022, subject to ratification of their appointment at every subsequent AGM, at such remuneration as approved by the Members at this AGM. Further, B S R LLP have under Section 139(1) of the Act and the Rules framed thereunder, furnished a certificate of their eligibility and consent for appointment.

The Board commend to seek consent of its Members on appointment of BSR LLP as Statutory Auditors for tenure of 5 year, to examine and audit the accounts of the Company during the said period.

Cost Audit

As per Section 148 of the Act, the Company is required to have the audit of its cost records conducted by a Cost Accountant in Practice. The Board of Directors of the Company has on the recommendation of the Audit Committee, approved the appointment of M/s Mani & Co., a firm of Cost Accountants in Practice (Registration No.000004) as the Cost Auditors of the Company to conduct cost audits pertaining to relevant products prescribed under the Companies (Cost Records and Audit) Rules, 2014 for the year ending March 31, 2018. The Board of Director on recommendation of the Audit Committee approved remuneration of Rs.5 lakhs plus out of pocket expenses, subject to ratification of their remuneration by the Members at the forthcoming AGM.

M/s Mani & Co. have, under Section 139(1) of the Act and the Rules framed thereunder furnished a certificate of their eligibility and consent for appointment.

M/s Mani & Co., have vast experience in the field of cost audit and have conducted the audit of the cost records of the Company for the past several years under the provisions of the erstwhile Companies Act, 1956.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors on recommendation of the Audit Committee appointed M/s Parikh & Associates, a firm of Company Secretaries in Practice to conduct the Secretarial Audit of the Company for the year ended March 31, 2017. The Report of the Secretarial Audit is annexed herewith as Annexure- 7.

The Board provides clarification on Auditor’s observation(s) contained in the Report:

a) the Company has provided adequate responses on queries / observations raised by the Central Government and their approval is awaited.

b) As at March 31, 2017, NRC had recommended to the Board appointment of Mr Om Prakash Bhatt, as Additional and Independent Director. The Board considered the recommendation of NRC and appointed Mr O P Bhatt as Additional and Independent Director on May 9, 2017.

DIRECTORS’ RESPONSIBILITY STATEMENT

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal, statutory, cost, external agencies and secretarial auditors, including audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Company’s internal financial controls were adequate and effective during Fiscal 2017.

Accordingly, pursuant to Section 134(5) of the Act, the Board of Directors, to the best of their knowledge and ability, confirm that:

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

(b) they have, selected such accounting policies and have 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 loss of the Company for that period;

(c) they have 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) they have prepared the annual accounts on a going concern basis;

(e) they have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and were operating effectively*; and

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

*please refer to the Section “Internal Control Systems and their Adequacy in the Management Discussion and Analysis”

ACKNOWLEDGEMENT

The Directors wish to convey their appreciation to all of the Company’s employees for their enormous personal efforts as well as their collective contribution to the Company’s performance. The Directors would also like to thank the employee unions, shareholders, customers, dealers, suppliers, bankers, Government and all the other business associates for the continuous support given by them to the Company and their confidence in its management.

On behalf of the Board of Directors

N CHANDRASEKARAN

Chairman

(DIN: 00121863)

Mumbai,

May 23, 2017


Mar 31, 2016

The Directors present their Seventy First Annual Report alongwith the Audited Statement of Accounts for Fiscal 2016.

FINANCIAL PERFORMANCE SUMMARY

(Rs. in crores)

Tata Motors Tata Motors Group

(Standalone) (Consolidated) Fiscal 2016 Fiscal 2015 Fiscal 2016 Fiscal 2015

FINANCIAL RESULTS

Gross Revenue 46,646.67 39,531.23 280,096.72 266,707.90

Net Revenue (excluding excise duty) 42,369.82 36,301.63 275,561.11 263,158.98

Total expenditure 39,629.67 37,101.64 235,324.45 221,045.16

Operating profit/ (loss) 2,740.15 (800.01) 40,236.66 42,113.82

Other Income 2,132.92 1,881.41 981.72 898.74

Profit before interest, depreciation, amortization, exceptional item and tax 4,873.07 1,081.40 41,218.38 43,012.56

Finance cost 1,481.11 1,611.68 4,623.35 4,86149

Cash profit/ (loss) 3,391.96 (530.28) 36,595.03 38,151.07

Depreciation, amortization and product development/ engineering expenses 2,878.36 3,040.69 20,494.61 16,263.80

Profit/(loss) for year before exceptional items and tax 513.60 (3,570.97) 16,100.42 21,887.27

Exceptional Items - loss (net) 363.21 403.75 2,119.55 184.71

Profit/(loss) before tax 150.39 (3,974.72) 13,980.87 21,702.56

Tax expenses/ (credit) (net) (83.84) 764.23 2,872.60 7,642.91

Profit/(loss) after tax 234.23 (4,738.95) 11,108.27 14,059.65

Share of minority interest and share of profit of associates (net) - - (84.52) (73.36)

Profit/(loss) for the year 234.23 (4,738.95) 11,023.75 13,986.29

APPROPRIATIONS

Profit/(loss) for the year 234.23 (4,738.95) 11,023.75 13,986.29

Add: Balance brought forward from previous year (3,667.96) 977.59 54,487.17 40,530.48

Amount available for appropriations (3,433.73) (3,761.36) 65,510.92 54,516.77

Less: appropriations /(transfer from/to)

General Reserve 3,506.73 - 3,483.73 (21.00)

Other Reserves - - (32.98) (39.52)

Dividend (including dividend distribution tax) (73.00) 93.40 (111.28) 30.92

Balance carried to Balance Sheet - (3,667.96) 68,850.39 54,487.17

DIVIDEND

Considering the Company''s financial performance, the Directors have recommended a dividend of Rs.0.20 per share (10%) on the capital of 2,887,203,602 Ordinary Shares of Rs.2/- each (Nil for last year) and r0.30 per share (15%) on the capital of 508,476,704 ''A''Ordinary Share of Rs.2/- each for Fiscal 2016 (Nil for last year) and the same will be paid on or after August 11, 2016. The said dividend, if approved by the Members, would involve a cash outflow of Rs.73 crores including dividend distribution tax (net of credit), resulting in a payout of 31.2% of standalone profits for Fiscal 2016 of the Company.

TRANSFER TO RESERVES

The profit for the Fiscal 2016 is Rs.234.23 crores. As the dividend has been declared from Reserves, a part of General Reserve has been adjusted against the accumulated loss in the Profit and Loss Account. Accordingly, the balance of Rs.3,506.73 crores is transferred from General Reserves to the Profit and Loss Account.

OPERATING RESULTS AND PROFITS

The global macroeconomic landscape in Fiscal 2016 was rough and uncertain and characterized by weak growth of world output. The situation has been compounded by; (i) declining prices of a number of commodities, with reduction in crude oil prices being the most visible of them, (ii) turbulent financial markets (specially the equity markets) and (iii) volatile exchange rates. Global growth remained moderate with uneven prospects across the major economies. The outlook for advanced economies is improving, while growth in emerging market and developing economies is projected to be lower, primarily reflecting weaker prospects for certain large emerging market economies alongside oil and raw material exporting economies. Oil prices have declined during Fiscal 2016 due to weaker than expected global activity and a weaker demand for oil. Exchange rate movements in recent months have been sizable, reflecting changes in expectations about growth and monetary policy across major economies. Long-term government bond yields have declined in major advanced economies, reflecting in part lower inflation expectations, the sharp decline in oil prices and weak domestic demand.

The US economy growth was stronger than with accompanying job growth, resulting in a decline in the unemployment rate. The Eurozone showed signs of economic improvement in 2015, with consumption supported by lower oil prices and higher net exports, driven by lower energy prices, a weaker Euro and a loose monetary policy by the European Central Bank. In Fiscal 2015, GDP in the UK slowed a little, but consumer spending growth remained relatively strong, partially due to lower oil prices. China recorded a pronounced deceleration in growth in Fiscal 2015, which suggests that China''s slowdown over the past few years shows little sign of abating. The GDP growth rate moderated to 6.9% for Fiscal 2015 and coincided, with growing debt and excess housing and factory capacity. Brazil''s economy sank into the deepest recession in recent history in 2015, amid low prices for key exports, soaring inflation and depressed confidence levels. Economic performance in Russia was impacted by the increase in geopolitical tensions, lower crude oil prices and economic sanctions.

However, India has registered a robust and steady pace of economic growth in Fiscal 2016 with GDP increased by 7.6%. Wholesale price inflation has been in negative territory for more than a year and the all important consumer prices inflation has declined to nearly half of what it was a few years ago. However, weak growth in advanced and emerging economies has taken its toll on India''s exports. As imports have also declined, principally on account of reduced prices of crude oil for which the country is heavily dependent on imports, trade and current account deficits continue to be moderate. Growth in agriculture has slackened due to two successive years of less than- normal monsoon rains. The rupee has depreciated vis-à-vis the US dollar, like most other currencies in the world, although less so in magnitude. At the same time, it has appreciated against a number of other major currencies.

The Tata Motors Group registered a growth of 5.0% in gross turnover to r280,097 crores in Fiscal 2016 as compared to r266,708 crores in Fiscal 2015. The consolidated revenue (net of excise) for Fiscal 2016 Rs.275,561 crores grew by 4.7% over last year on the back of strong growth in wholesale volumes across products of Jaguar Land Rover and complemented by strong M&HCV sales in India. The consolidated EBITDA margins for Fiscal 2016 stood at 14.6%. Consequently, Profit Before and After Tax were Rs.13,981 crores and Rs.11,024 crores respectively.

Tata Motors Limited recorded a gross turnover of Rs.46,647 crores, 18.0% higher from Rs.39,531 crores in the previous year. Tailwinds from improving macros - softening interest rates, lower fuel cost and inflation, steady replacement demand from large fleet operators has supported sales growth in M&HCV resulting in significant improvement in EBITDA margins to 6.5% in Fiscal 2016 as against negative 2.2% in Fiscal 2015. Profit Before and After Tax for Fiscal 2016 was at r150 crores and Rs.234 crores respectively, as compared to Loss Before and After Tax of Rs.3,975 crores and Rs.4,739 crores, respectively for last Fiscal.

Jaguar Land Rover (JLR) (as per IFRS) recorded revenue of GB£22,208 million (Rs.219,019 crores) for Fiscal 2016, up 1.6% from the £21,866 million (Rs.215,646 crores) in the last Fiscal Year, primarily reflecting the successful introduction of new products.

Consolidated EBITDA for Fiscal 2016 was strong at GB£3,147 million (Rs.31,036 crores) but down compared to Fiscal 2015 of GB£4,132 million (Rs.40,750 crores), primarily driven by softer market and model mix and as well as one-time reserves and charges of GB£166 million (Rs.1,637 crores) including the US recall of potentially faulty passenger airbags supplied by Takata, doubtful debts and previously capitalised investment.

Profit Before Tax (PBT) in Fiscal 2016 was GB£1,557 million (Rs.15,355 crores) down by GB£1,057 million compared to the record PBT of GB£2,614 million (Rs.25,780 crores) in Fiscal 2015 primarily reflecting the lower EBITDA, higher depreciation and amortisation and the net exceptional charge of GB£157 million (Rs.1,638 crores) related to vehicles damaged or destroyed in the Tianjin port explosion in August 2015, partially off set by favourable revaluation of US Dollar debt and unrealised FX and commodity hedges as well as profits earned in the China Joint Venture.

Tata Motors Finance Limited (TMFL) (consolidated) the Company''s captive financing subsidiary, registered a growth in revenues by 8.0% to Rs.2,968 crores (previous year: r2,743 crores) and reported a Profi t After Tax of r267 crores in Fiscal 2016, as compared to Loss after Tax of r611 crores in Fiscal 2015. TMFL''s concerted eff orts on collection and NPA management strategy has helped to reduce credit losses and gross non-performing assets during Fiscal 2016.

Tata Daewoo Commercial Vehicle Company Limited (TDCV) (as per Korean GAAP) South Korea registered revenues of KRW 880 billion (r5,096 crores), a decline of 11% over the previous year mainly due to lower export sales partially off set by increase in domestic sales. The Profit after tax was KRW 46 billion (Rs.264 crores) compared to KRW 54 billion (Rs.304 crores) of previous year which included one-time reversal of provisions pertaining to ordinary wage lawsuit KRW 24 billion (Rs.136 crores). Better profitability of Euro 6 vehicles, better mix, favourable exchange realizations, continuous material cost reduction, various cost control and inventory initiatives helped in improving profits.

VEHICLE SALES AND MARKET SHARES

The Tata Motors Group sales for the year stood at 1,064,596 vehicles, up by 6.7% as compared to Fiscal 2015. Global sales of all Commercial Vehicles were 390,953 vehicles, while sales of Passenger Vehicles were at 673,643 vehicles.

TATA MOTORS

Tata Motors recorded sales of 511,931 vehicles, a growth of 1.5% over Fiscal 2015. The Indian Auto Industry, grew in Fiscal 2016 by 8%, resulting in the Company''s market share decreasing to 13.1% in Fiscal 2016 from 14.1% in the previous year. The Company''s exports on standalone basis grew by 16.3% to 58,058 vehicles in Fiscal 2016 as compared to 49,936 vehicles in Fiscal 2015.

Commercial Vehicles

Within the domestic market, the Company sold 326,755 Commercia Vehicles (CV), a growth of 2.8% from Fiscal 2015 driven by volume expansion across segments. While M&HCVs have been growing through the year, the LCV segment witnessed positive growth during the second half of the Fiscal 2016, both in goods and passenger carrier segment. M&HCV trucks continued strong growth, registering a 30.0% rise over last Fiscal Year and the Company has been able to retain a strong market share of 56% in this category.

Some of the highlights for the year were:

- Launched the new SIGNA range of M&HCV, at the SIAM Auto Expo 2016. Offered in various configurations, the SIGNA range of commercial vehicles is engineered and built to offer M&HCV buyers, a newly designed cabin, with proven Tata Motors aggregates, for a world-class trucking experience

- Launch of ACE Mega, the all-new Smart and Small Pick-up Truck with superior performance, enhanced looks, strong cabin with rated payload of 1Tonne, which offers the best-in-class fuel efficiency and lowest cost of ownership

- Achieved a new feat in the last mile public transport portfolio by reaching a remarkable sales mark of 3 Lakh Tata Magic, our most popular public transport vehicle

- Celebrated the 10th anniversary of the Tata Ace (launched in 2005) as the ''Decade of Trust''throughout the country

- The Company has been honoured with the ''Best Telematics Product or Launch in the Emerging Market''Award for its Telematics solution, based on the popular Android platform developed for the Tata Magic Iris Electric

- This year, the Company won 4 prestigious awards at the Apollo CV Awards:

- Cargo carrier of the year - Tata LPS 4923 School Bus of the year - Tata Cityride Skool Bus

- Special Application CV of the year - Tata MHC 2038

- CV dealer of the year - Bhandari Automotive (Tata Motors dealership).

Organized the Prima Truck Racing Championship Season 3, which drew in over 55,000 spectators. The highlight this year was the first ever race of Indian truck racing talent, trained and nurtured in India. The Company has conceptualized and introduced an Indian Driver Training and Selection program - "T1 Racer Program" to induct and mold Indian truck drivers as ''racers''

Participated in the SIAM Auto Expo 2016 and the following vehicles were showcased:

- SIGNA range of M&HCV Trucks

- Tata ULTRA 1518 Sleeper from the Ultra range with 15.7T GVW and furnished with a spacious cabin and a fully trimmed power steering, seating three, along with a bed, ensures a safe and comfortable working design for the driver

- ACE MEGA XL - Last mile cargo transport with a rated payload of 1Ton, 8-feet loading deck, with a top speed of 80 km/hr

- MAGIC IRIS ZIVA - gearless, clutchless with futuristic Hydrogen Fuel Cell technologies, for zero emissions

- ULTRA 1415 4X4 - A 4X4 rugged performer, with a snow plough and a hydraulic crane

- STARBUS HYBRID - World''s first commercially produced CNG Hybrid Bus, using Electric and CNG modes (BS IV compliant) as fuel

- ULTRA ELECTRIC - First full-electric bus from the Company, with zero emissions and noiseless operations.

- Participated in EXCON 2015 and showcased four new construction vehicles - Tata PRIMA 3138.K 32 CuM Coal Tipper, Tata PRIMA LX 2523.K RePTO, Tata PRIMA LX 3128.K 19 CuM Scoop HRT and Tata SAK 1613

- Tata Motors Loyalty Program (Tata Delight and Tata Emperor) was recognized by DMA Asia ECHO™ Awards and PMAA Dragons of Asia in December 2015

- Awarded contract for 1,239 indigenously developed 6X6 high mobility multi-axle vehicles, from the Indian Army which was recently followed up with a repeat order for 619 units

- Signed a contract to supply 25 Tata Starbus Diesel Series Hybrid Electric Bus with Full Low floor configuration, with the Mumbai Metropolitan Region Development Authority (MMRDA) - the single largest order awarded for Hybrid Electric vehicle technology.

Passenger Vehicles

The domestic passenger vehicle industry grew by 7.6% during Fiscal 2016. Correction in fuel prices and easing financing cost has resulted in lower operating cost, which should further aid domestic PV growth in near to medium term. During the year, the Company''s Passenger Vehicles sales were lower by 7.0% at 127,118 vehicles, registering a 4.6% market share. The Company sold 106,827 cars (lower by 3.8%) and 20,291 utility vehicles and vans (lower by 20.6%). The Company''s sales in the Utility Vehicle segment suffered as competitive activity intensified with multiple new launches mainly in the soft-roader category in this segment. The Company has taken various initiatives to improve its performance such as product refreshes/launch programs, operational efficiency dealer effectiveness, working capital management and restructuring customer facing functions.

Some of the highlights of this year''s performance were:

- Product Launches/Refreshes continued under the Horizonext Strategy

- GenX-Nano range was launched in May 2015, with latest technological advancements and design upgrade

- Safari Storme 400Nm was launched in November 2015, with high power/torque engine and new six speed manual gearbox.

- The Made of Great Brand Campaign was launched to uplift the Tata Motors brand in conjunction with Lionel Messi

- Hexa SUV, Kite 5 compact sedan and Nexon compact SUV were displayed at Auto Expo 2016.

- As a part of the overall social responsibility, the Company had to postpone the launch of "Tiago", due to the change in name responding against the epidemic "Zika".

The above new/refreshed product launches were in-line with the Company''s objective of taking the brand to a higher level, while making it relevant for the younger buyer. The Company continued to focus on building brand strengths, refreshing products and enhancing sales and service experience.

Exports

The Company exported 58,058 vehicles (Fiscal 2015: 49,936 vehicles) comprising 54,052 units of Commercial Vehicles and 4,006 units of Passenger Vehicles during Fiscal 2016.

Export of Commercial Vehicles grew by 16.5% in Fiscal 2016 with 54,052 units exported compared to 46,416 in Fiscal 2015. The traditional markets of SAARC remained stronger than last year growing by 26% with Sri Lanka, Bangladesh and Nepal contributing to the growth. However, the mid-term duty change in Sri Lanka and the lockdown in Nepal impacted the growth momentum. However, the subsequent opening of border and easing of pent up demand led to record shipments to Nepal in Q4 of Fiscal 2016. Low crude oil prices, Middle East geo-political situation, currency devaluations and political strife cast a big shadow over our strong markets of Middle East and Africa this year. The Company was able to grow market share in the key markets of Sri Lanka, Kenya, Nepal, Ghana, Congo and Senegal. In Fiscal 2016, the Company successfully bagged and executed several prestigious orders including 450 units Xenon troop carriers for the Ministry of Defence Myanmar taking the total order count to 1,450 units; 87 units of Elanza school buses in Saudi Arabia; 50 units Prima 4,438 in Saudi Arabia; 44 units Ultra truck delivery to Pran RFL Bangladesh and more that 1,000 units Tata Saathi, an application on the ACE platform to Bangladesh. Some of the key events in Fiscal 2016 were the launch of Tata Prima in Kenya, Uganda and Bangladesh; Ultra Bus in Sri Lanka; Ultra trucks in Bangladesh; Elanza bus in UAE and Ace Express, Ace Mega in Sri Lanka and Nepal. The Company also opened Assembly units with 3rd party vendors in Tunisia and Vietnam. In Fiscal 2016, the Company achieved a key milestone of 1,000 Prima retails in export markets.

During the period Fiscal 2016, the Company''s exports of Passenger Vehicles at 4,006 units were 13.8% higher than in Fiscal 2015, mainly due to improved sales in key markets like Sri Lanka and South Africa. Aggressive efforts on the back of the launch of Nano GenX and retails of Indica Xeta gave us strong volume growth in Sri Lanka, whereas in South Africa sales were boosted by the launch of the Bolt (hatchback) and Zest (compact sedan).

In Nepal, the launch of Bolt has helped the Company to improve its share of the hatch segment whereas Zest helped to augment Company''s presence in the compact sedan segment and Sumo continues to be the Number One selling brand in UVs in Nepal. ndigo also found an increased acceptance in the commercia segment in Bangladesh, the Philippines and Uruguay.

JAGUAR LAND ROVER (JLR)

In Fiscal 2016, JLR continued to experience growth in all geographical markets, except China with total wholesale sales of 544,085 units, a growth of 15.6% as compared to Fiscal 2015. JLR total retail sales were up 12.8%, with Jaguar up 22.8% and Land Rover up 10.9%. Sales were higher in the majority of markets in Fiscal 2016 as retails in the UK increased by 23.8% year on year, North America by 27.1% and Europe by 42.0% whilst sales growth in other Overseas markets were broadly similar to last year. However, retail sales in China were down 16.4% primarily reflecting softer economic conditions in China at the beginning of the year, the timing of new product launches and the transition of production to our China Joint Venture.

Some of the highlights of this year were:

The new Jaguar XE went on general retail sale in May 2015

- The refreshed 16 Model Year Range Rover Evoque went on sale in August 2015

- Launch of the all new lightweight Jaguar XF went on sale in September 2015

- Production of the Land Rover Discovery Sport commenced at the China Joint Venture and went on sale locally in November 2015

- Launch of the refreshed 16 Model Year Jaguar XJ went on sale in December 2015

- Jaguar''s all new luxury performance SUV was revealed to the public and went on sale at the end of the year

- Very own 4 cylinder diesel engine produced at the Engine Manufacturing Centre in Wolverhampton in the UK was first introduced into the Jaguar XE and is now available in some of other vehicles such as the Jaguar XF, Range Rover Evoque and Land Rover Discovery Sport

- Announced an additional GB£450 million investment in the Engine Manufacturing Centre in Wolverhampton to double capacity bringing total investment to almost GB£1 billion

- Announcement that an investment agreement has been signed to build a manufacturing plant in the city of Nitra in Slovakia with annual capacity of 150,000 units with production commencing in Fiscal 2018. The initial investment will be GB£1 billion with the option to invest a further GB£500 million to double capacity to 300,000 units per annum subject to a further feasibility study

- Jaguar will be competing in the FIA Formula E championship from August 2016 which presents a unique and exciting opportunity for Jaguar Land Rover to further the development of its future electric powertrain technology

- Announcement that the all new Jaguar XF L (Long wheel base XF) will be the third vehicle to be produced at the China Joint Venture.

Tata Daewoo Commercial Vehicle Company Limited

Tata Daewoo Commercial Vehicle Company Limited (TDCV) sold 9,116 vehicles, lower by 22.2% over Fiscal 2015, mainly due to lower export sales partially compensated by increase in domestic sales. TDCV continued the strong performance, in the domestic market inspite of increased competition by selling 7,036 vehicles, 2nd highest in its history, registering a growth of 3.3% compared to sales of 6,808 vehicles in Fiscal 2015. The newly introduced Euro 6 models were well accepted in the market resulting in an increase in the market share for both HCV and MCV Segments put together increasing to 31.0% as compared to 28.7% in Fiscal 2015. However, the export market scenario was very challenging. Factors like low oil prices, local currency depreciation against the US Dollar, new statutory regulations to reduce imports, slowdown in Chinese economy impacting commodity exporting countries, increased dealer inventory etc. adversely impacted TDCV''s exports in major markets like Algeria, Russia, Vietnam, South Africa, GCC etc. The export sales were 2,080 units, 57.6% lower compared to 4,902 units in Fiscal 2015.

Tata Motors (Thailand) Limited

Tata Motors (Thailand) Limited (TMTL) sold 1,312 units in Fiscal 2016 as compared to 1,305 units in Fiscal 2015. The domestic retail sales fi gure was 1,124 units. The Thai Automobile Industry has witnessed the 3rd year of drop of 9.0% in Fiscal 2016 due to poor performance of the economy but witnessed a slew of new pickup launches by major OEMs during the year. In spite of the slow-down, TMTL domestic volume decline was 6.0% compared to 9.0% of industry TMTL has increased its market share in "CNG and Bi-Fuel Pickups segment" to 25.2% (Previous Year 24.0%) to become the second largest player in the segment.

TMTL has taken the opportunity to refresh its products, services and network as well as to expand the range of offerings to the Thailand customers. Fiscal 2016 saw the launch of the Xenon 150N Series with a host of new features, TDCV Novus and Super Ace Mint. During the year, TMTL exported 253 vehicles to Malaysia against specific order from POS Malaysia. TMTL is exploring similar opportunities in other parts of South East Asia and neighbouring continents.

Tata Motors (SA) (Pty) Limited

Tata Motors (SA) (Pty) Ltd (TMSA) sold 765 chassis in the South Africa market in Fiscal 2016 as compared to 839 chassis in Fiscal 2015. TMSA is in the process of homologating and introducing a range of new products including Prima and Ultra trucks as well as a couple of bus models for sale in South Africa.

Tata Motors Finance Limited

Tata Motors Finance Limited ( TMFL) is a wholly owned subsidiary company is carrying out vehicle financing activity under the brand "Tata Motors Finance".

On March 31, 2016, TMFL has acquired from the Company, 100% shareholding in Sheba Properties Limited, a NBFC registered with the Reserve Bank of India as a part of restructuring and consolidation of financial services companies under the TMFL group.

The commercial vehicle business saw a growth during Fiscal 2016, majorly contributed by the M&HCV segment. As a result of which TMFL''s total disbursements (including refinance) increased by 22.8% at Rs.8,985 crores in Fiscal 2016 as compared to Rs.7,316 crores in Fiscal 2015. TMFL financed a total of 1,12,114 vehicles reflecting a slight decline of 0.6% over 1,12,788 vehicles financed in Fiscal 2015. Disbursements for commercial vehicles increased by 30.4% and were at Rs.7,485 crores (75,970 units) as compared to Rs.5,741 crores (72,853 units) of Fiscal 2015. Disbursements of passenger vehicles declined by 9.9% to r1,350 crores (33,185 units) from a level of Rs.1,498 crores (38,444 units). Disbursements achieved under refinance (through Tata Motors Finance Solutions Limited, a 100% subsidiary of TMFL) were at Rs.150 crores (2,959 vehicles) during Fiscal 2016.

TMFL has increased its reach by opening limited services branches exclusively in Tier 2 and 3 towns, which have helped in reducing the turn-around-time to improve customer satisfaction. TMFL had 245 branches at the end of Fiscal 2016. The book size of TMFL''s corporate lending business, which includes providing finance to TML''s dealers & vendors, increased by 97.7%; Rs.947 crores in Fiscal 2016 from r479 crores in Fiscal 2015.

MATERIAL CHANGES & COMMITMENT AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There are no material changes affecting the financial position of the Company subsequent to the close of the Fiscal 2016 till the date of this report.

SHARE CAPITAL

During the Fiscal 2016, the Company had issued on a Rights basis Ordinary Shares (including the rights offering to ADR holders) and ''A'' Ordinary Shares aggregating Rs.7,500 crores. The particulars as required under Section 134 of the Companies Act, 2013 ("Act") read with Rule 4 of the Companies (Share Capital and Debentures) Rules, 2014 on issue of equity shares with differential voting rights on Rights basis during the Fiscal Year is annexed as Annexure 1.

SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS

There are no significant material orders passed by the Regulators or Courts or Tribunal which would impact the going concern status of the Company and its future operation. However, Members attention is drawn to the Statement on Contingent Liabilities and commitments in the Notes forming part of the Financial Statement.

RISK MANAGEMENT

The Risk Management Committee (RMC) comprising of 4 Independent Directors, has been entrusted with responsibility to assist the Board in (a) overseeing the Company''s risk management process and controls, risk tolerance and capital liquidity and funding; (b) setting strategic plans and objectives for risk management and review of risk assessment of the Company (c) review the Company''s risk appetite and strategy relating to key risks, including credit risk, liquidity and funding risk, market risk, product risk and reputational risk as well as the guidelines, policies and processes for monitoring and mitigating such risks.

The Committee operates as per its Charter approved by the Board and within the broad guidelines laid down in it. The Company has a Risk Management Policy in accordance with the provisions of the Act and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI Listing Regulations). It establishes various levels of accountability and overview within the Company, while vesting identified managers with responsibility for each significant risk.

The Board takes responsibility for the overall process of risk management in the organisation. Through Enterprise Risk Management Programme, Business Units, Corporate functions address opportunities and the attendant risks through an institutionalized approach aligned to the Company''s objectives. This is facilitated by Internal Audit. The business risk is managed through cross functional involvement and communication across businesses. The results of the risk assessment and residual risks are thoroughly discussed with the Senior Management before being presented to RMC.

INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENT

Details of internal financial control and its adequacy are included in the Management Discussion and Analysis Report, which forms part of this Report.

HUMAN RESOURCES

The Tata Motors Group employed 76,598 permanent employees (previous year: 73,485 employees) as of the year end. The Company employed 26,569 permanent employees (previous year: 27,997 employees) as of the year end. The Tata Motors Group has generally enjoyed cordial relations with its employees and workers.

All employees in India belonging to the operative grades are members of labour unions except at our Sanand and Dharwad plants. All the wage agreements have been renewed in a timely manner and are all valid and subsisting. Operatives and Unions support in implementation of reforms that impact quality, cost erosion and improvements in productivity across all locations is commendable.

Safety & Health – Performance and Initiatives

As part of Company''s Safety Excellence Journey which aims to achieve ultimate goal of Zero Injuries to its employees and all stakeholders associated with the Company''s operations, Company provides a safe and healthy workplace focusing on creating right Safety Culture across the organization.

The Company has identified four drivers behaviors which will help keep moving in this journey and attain Zero Injury viz. the drivers are engaged at all levels; governance; robust safety processes and improving safe behaviors.

The Company''s India operation, has achieved improved performance with Lost Time Injury Frequency Rate (LTIFR) being 0.17 for the Fiscal 2016, a reduction in injury rate by 15% over Fiscal 2015. While overall safety performance has improved but there was one fatality during the year, involving a customer sales employee in a road incident while on the job.

All Manufacturing Plants in India of the Company are certified to ISO 14001 - Environment Management Systems and are also certified to OHSAS 18001 – Occupational Health & Safety Management System. Further, all CV Manufacturing Plants in India are certified to ISO 50001 - Energy Management System. The Company has undertaken several initiatives for resource conservation such as re-cycling of treated effluents back to process, energy and material recovery from hazardous wastes and rainwater harvesting. Manufacturing plants also generate in-house renewable power and source off -site green power where available.

The Senior Leadership is fully committed and engaged in safety and health journey and has set up a very robust Governance and Engagement model at various level right from having Safety Health and Environment Committee at Board, Business, Site, Corporate, Sub- committees and Factory Implementation Committees.

The Company continued Campaign ''i-drive safe''– an initiative on building a safe driving culture amongst its employee and associates and have trained them Defensive Driving. In excess of 19,103 employees and associates till date have been trained under this campaign, initiated few years ago.

In line with Safety and Health Policy, to enhance safety standards of its business partners, the Company engages supply chain for safety. The objective of such engagement is to raise the Safety standards of dealer workshops. Jagruti – Safety Awareness Building Campaign for Workshop Managers is a year-long campaign focused on building awareness on safety and understanding of the Company''s expectations on Dealers Workshop Safety. This programme is collaboration of the Company, Castrol and training partner ICECD. The year-long campaign aims to cover works managers/representatives of 2,000 workshops (CV & PV) across India by January 2017. In Fiscal 2016, 21 sessions are conducted covering 565 workshops.

In health area, the Company under the ''Health Plus Because you matter!'' initiative engaged employees on various subject of Health. Series of initiatives like awareness sessions, mailers, etc. have been conducted under this initiative. For Food Safety, HACCP Certification process has been started at plant canteens.

The Jaguar Land Rover business drives its health and safety ambition through its campaign - Destination Zero – A Journey to Zero Harm. This is overseen by the statements on the Jaguar Land Rover, ''Blueprint for Lasting Success''with the overall commitment that states "Our most valuable asset is our people, nothing is more important than their safety and wellbeing. Our co-workers and families rely on this commitment. There can be no compromise". The business maintains its accreditation to the external standard of OHSAS 18001, with all the UK locations accredited to the standard through a series of annual external assessments. The business has reviewed and re-launched its internal safety assessment process SHARP (Safety and Health Assessment Review Process) within its manufacturing locations. The Lost Time Case Rate in terms of incidents has remained steady with around 7.0% improvement over previous year''s performance, against a backdrop of massive growth and increased headcount and volumes within the business. The activities deployed to deliver this ambition of Zero Harm are underpinned with everyone being encouraged to understand and take responsibility for their own and their fellow workers safety and wellbeing. Each functional area has ability to build their own plans of activities to drive the performance within their own area of responsibility. During last year the business has launched the Wellbeing Charter – an externally assessed framework to deliver excellence in wellbeing activities and strategies. This is a journey Jaguar Land Rover is embarking on, to achieve and sustain excellence in this subject. In the last quarter the business received its first recognition on this journey by being awarded the ''Commitment Level''in the framework.

TDCV Korea achieved an improvement in Safety Index to 0.33 from 1.15 in Fiscal 2016. There has been continued leadership commitment and engagement with focus in areas safety communication, risk assessment, improving capabilities of employees for emergency situations.

TMTL, Thailand and TMSA, South Africa sustained good performance in area of Safety and Health during Fiscal 2016.

Prevention of Sexual Harassment

The Company has zero tolerance for sexual harassment at workplace and has adopted a Policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. The Company is committed to providing equal opportunities without regard to their race, caste, sex, religion, colour, nationality, disability, etc. All women associates (permanent, temporary, contractual and trainees) as well as any women visiting the Company''s office premises or women service providers are covered under this Policy. All employees are treated with dignity with a view to maintain a work environment free of sexual harassment whether physical, verbal or psychological.

During the Fiscal 2016, the Company has received 7 complaints on sexual harassments, which have been substantiated and appropriate actions were taken. The Company organized 15 workshops or awareness program against sexual harassment. There were no complaints pending for more than 90 days during the year.

Similar initiatives on Prevention of Sexual Harassment are in place across the Tata Motors Group of companies.

BUSINESS RESPONSIBILITY REPORT

Pursuant to Regulation 34(2)(f) of the SEBI Listing Regulations, the Business Responsibility Report (BRR) initiatives taken from an environmental, social and governance perspective, in the prescribed format is available as a separate section of the Annual Report and also hosted on the Company''s website www.tatamotors.com.

FINANCE

During the year, the free cash flows for Tata Motors Group were Rs.6,543 crores, post spend on capex, design and development of Rs.32,623 crores. Tata Motors Group''s borrowing as at March 31, 2016 stood at r70,468 crores (as at March 31, 2015: Rs.73,610 crores). Cash and bank balances and investments in mutual funds stood at r52,091 crores (as at March 31, 2015: Rs.46,174 crores). With healthy profitability and cash flow generation, the Consolidated Net Automotive Debt to Equity Ratio stood at (0.01) as at March 31, 2016 as compared to 0.19 as at March 31, 2015.

The Cash flows from operations were positive Rs.2,346 crores for standalone operations of the Company. Spend on capex, design and development were Rs.2,982 crores (net). The borrowings of the Company as at March 31, 2016 stood at r15,887 crores (as at March 31, 2015: Rs.21,134 crores). Cash and bank balances including mutual funds stood at Rs.2,188 crores (as at March 31, 2015: Rs.945 crores).

The Company did a Rights Issue for Rs.7,498 crores (US$1.2 billion) by allotting 15,04,90,480 Ordinary shares (including 3,20,49,820 shares underlying the ADRs) of Rs. 2 each at a premium of Rs.448 per share, aggregating Rs.6,772.07 crores and 2,65,09,759 ''A''Ordinary shares of Rs.2 each at a premium of Rs.269 per share, aggregating Rs.718.42 crores. As per the object of the Issue, the proceeds of Rs.500 crores from the share issue have been used for funding expenditure towards plant and machinery, Rs.1,500 crores towards research and product development, Rs.4,000 crores towards repayment in full or in part of certain long-term and short-term borrowings and Rs.1,401.10 crores towards general corporate purposes.

The Company prepaid Rs.140 crores of its unsecured 10% NCD due in 2019 and Rs.10 crores of its unsecured 10.30% NCD due in 2018.

At JLR, post spend on capex, design and development of GB£2,806 million (Rs.27,673 crores), the free cash flows were GB£791 million (Rs.7,550 crores) for Fiscal 2016. The borrowings of JLR as at March 31, 2016, stood at GB£2,500 million (Rs.23,863 crores) [previous year: GB£2,550 million (Rs.23,574 crores)]. Cash and financial deposits stood at GB£4,651million (r44,394 crores) [previous year: GB£4,263 million (Rs.39,411 crores)]. Additionally, JLR has undrawn committed long term bank lines of GB£1,875 million (JLR data as per IFRS).

TML Holdings Pte Ltd, Singapore, a 100% subsidiary of the Company, holding the investment in Jaguar Land Rover and other foreign subsidiaries has refinanced existing unsecured multi currency loan of US$600 million (US$250 million and SG$62.8 million maturing in November 2017 and US$210 million and SG$114 million maturing in November 2019) by a new syndicated loan of US$600 million (US$300 million maturing in October 2020 and US$300 million maturing in October 2022). Subsequently TML Holdings Pte Ltd, Singapore has also refinanced the existing SG$350 million 4.25% Senior notes due in May 2018 by a new syndicated loan of US$250 million maturing in March 2020.

Tata Motors Finance Limited has raised an amount aggregating to r434 crores by way of Non-Participating Cumulative Compulsorily Convertible Preference Shares which qualified as Tier 1 capital to meet growth and maintain capital adequacy ratio. There has been no fresh issuance of perpetual debt instruments or subordinated debt instruments/debentures towards Tier 1 and Tier 2 Capital in Fiscal 2016.

Tata Motors Group has undertaken and will continue to implement suitable steps for raising long term resources to match fund requirements and to optimise its loan maturity profile.

During the year, the Company''s rating for Foreign Currency Borrowings was retained at "Ba2"/Stable by Moody''s and was retained by Standard & Poors to "BB"/with change in outlook to Stable. For borrowings in the local currency, the ratings was retained by Crisil at "AA"/Stable and by ICRA at "AA"/Stable. The Non-Convertible Debentures and Long Term Bank facilities i.e. (Buyers Credit) rating by CARE was retained at "AA"/Stable. During the year, JLR''s rating was retained by Moody''s at "Ba2"/Positive and was retained by Standard & Poors at "BB"/with change in outlook to Stable for Tata Motors Finance, CRISIL has maintained its rating on long-term debt instruments and bank facilities to CRISIL "AA/ A1 "/ Stable and ICRA has maintained its rating at AA/Stable for long term.

FIXED DEPOSITS

The Company has not accepted any deposits from the public falling in the ambit of Section 73 of the Act and The Companies (Acceptance of Deposits) Rules, 2014.

EXTRACT OF ANNUAL RETURN

As provided under Section 92(3) of the Act, the details forming part of the extract of the Annual Return is annexed herewith in Form MGT 9 Annexure 2

INFORMATION TECHNOLOGY AND DIGITAL PRODUCT DEVELOPMENT INITIATIVES

Information Technology Initiatives

The Company is a forerunner in the Industry to adopt new technologies in the evolving digital area. The Company has a well- defined IT roadmap which revolves around user experience, mobility, analytics and cloud driven flexible infrastructure. It leverages its strong partnerships with product and services companies to harness the potential of Information Technology for ensuring execution of business initiatives towards a competitive advantage. The major highlights of IT at the Company are:

- Major technology upgrades undertaken including ERP, CRM, Analytics systems to make the systems current and leverage new versions''mobile friendly capabilities

- Implemented key projects in Supplier Relationship Management, comprehensively digitizing supplier processes to deliver speed, optimum in-line inventory and transparency

- Enabling World Class Quality initiative of the Company through key IT interventions on the shop floor e.g. Project Tantra for poka yoke on key aggregates

- IT has enabled customer care initiatives like implementation of Theory of Constraints in Spare Parts to improve parts availability, and reengineering the accident repair process for faster deliveries of repaired vehicles to customers

- Digital initiatives like job cards on tablets, customer self-service app, a new mobile friendly intranet and device and browser independent CRM in it upgraded avatar

- The IT initiatives towards the journey to digital readiness have been acknowledged with many industry awards including the Digitalist, Jewels of Digital, IDC Insights Award for Employee engagement, CIO Power List (Automotive Icon and Cloud Icon)

- Greater systematic collaboration with subsidiaries leveraging IT leadership in Tata Motors. A key achievement has been extension of collaboration solution to six subsidiaries

- Strengthening information security through multiple initiatives under ISO 27000 framework while covering mobiles under enterprise security

- Playing a leading role in AutoDx, the EDI initiative under the SIAM ACMA umbrella. AutoDX transactions have rapidly and successfully scaled up in Fiscal 2016.

Information Technology initiatives and Digital Business roadmap would help the Company in being forefront of automotive industry supporting business growth and innovation to strengthen the Company''s core technology capabilities.

Digital Product Development Systems Initiatives

The Company has constantly adopted new technologies and practices in digital product development domain to improve the product development process. This has led to having a better front loading of product creation, validation and testing towards timely delivery and getting the new products first time right. Niche integration tools, systems and processes continue to be enhanced in the areas of CAx, Knowledge Based Engineering (KBE), Product Lifecycle Management (PLM) and Manufacturing Planning Management (MPM) for more efficient end-to-end delivery of the product development process.

Some of the key enhancements done in digital product development domain include:

- Embedding manufacturing feasibility and DFx in engineering and design to early detection and resolution of feasibility issues

- Enhancement of virtual simulation capability leading to front loading of activities, e.g. in crash

- Enhancement of PLM and addition of new functionality for process control and collaboration like auto fl ashing of ECU at dealer location, vehicle feature list release process and change management

- Implementation of 15 new KBE applications in the area of design and safety, e.g. dashboard reflection analysis, seat comfort analysis, etc

- Enhancement of product visualization process for realistic evaluations and showcasing the in-mobility applications

- Development of new 3D product data visualization application for aiding downstream agencies for better decision making

- Improved utilisation of Digital Manufacturing Planning and Factory Simulation shop floor in the form of 3D work instructions for shop floor usage.

Subsidiaries

Jaguar Land Rover (JLR)

JLR continues its business transformational initiative, ''i-PLM'', delivered through a strategic partnership with a leading software technology provider. At the core of i-PLM is the philosophy of ''Single Source of Truth'', author once and consume everywhere. This vision and the close alignment with the software platform, delivers a simplified product creation landscape which eliminates inefficient integration issues at source.

This transformational journey has begun with the implementation of the vision for one vehicle programme that has moved from its legacy systems, with several more to follow over the next few months and the support processes and team for the new solution are active with a very high level of customer satisfaction.

Tata Daewoo Commercial Vehicles (TDCV)

TDCV continued the momentum of focusing on quality and speed in its digital product creation processes. As part of this, PLM application server infrastructure was refreshed, consolidated with the latest hardware and virtualization technology, enabling implementation of critical application suite resulting in improved availability.

Tata Technologies Limited (TTL)

TTL continued to invest in new technological advancements as part of the hardware and software upgrades. It initiated a Virtua Desktop Infrastructure (VDI) setup in the training area to facilitate faster deployment of CAD/CAE/PLM software applications in a virtua environment.

Tata Motors European Technical Centre (TMETC)

TMETC upgraded its data center infrastructure for PLM to the best in class virtualised environment. It implemented high performance computing to enable faster digital validation. Knowledge Based Engineering Applications were introduced in the engineering and design areas.

TECHNOLOGY AND ENVIRONMENT FRIENDLY INITIATIVES

The Company is working on several electrification, hybridisation and alternate fuel technologies in addition to developing technologies that improve the footprint of conventional powertrains. Some of the key areas are enlisted below:

Fully electric versions of small commercial vehicles aimed at complying to regulatory environment in crowded areas of cities where they ply, proving Company''s thrust on cutting edge technologies -Hybrid electric vehicles for passenger cars which are at various stages of maturity

- Delivery of diesel series hybrid buses to the city of Mumbai in near future based on successful fleet operation of CNG hybrid buses in Madrid, Spain which has covered close to a million kilometers in revenue service

- Fuel cell version of the hybrid bus as well as full electric buses, based on large format battery packs and overhead current collectors

- Dual fuel technology (CNG plus diesel) developed and limited field trials conducted

- Development of fuel efficient driveline oil (transmission and axle) enhancing customer delight

- Fuel efficiency improvement by implementing variable valve timing and variable oil pump technologies on passenger car gasoline engine

- Continuation of fuel efficiency improvement initiatives on passenger and commercial vehicles through software features in engine management system & vehicle level parameter optimization.

CONSOLIDATED FINANCIAL STATEMENTS

Tata Motors announces consolidated financial results on a quarterly basis. As required under the SEBI Listing Regulations, consolidated financial statements of the Company and its subsidiaries, prepared in accordance with Accounting Standard 21 issued by the Institute of Chartered Accountants of India, form part of the Annual Report and are reflected in the consolidated financial statements of the Company. Pursuant to Section 129(3) of the Act, a statement containing the salient features of the financial statements of the subsidiary companies is attached to the financial statements in Form AOC-1. The Company will make available the said financial statements and related detailed information of the subsidiary companies upon the request by any member of the Company or its subsidiary companies. These financial statements will also be kept open for inspection by any member at the Registered Office of the Company and the subsidiary companies.

Pursuant to the provisions of Section 136 of the Act, the financial statements of the Company, consolidated financial statements along with relevant documents and separate audited accounts in respect of subsidiaries, are available on the website of the Company.

SUBSIDIARY, JOINT VENTURE AND ASSOCIATE COMPANIES

The Company had 77 (direct and indirect) subsidiaries (11 in India and 66 abroad) as on March 31, 2016, as disclosed in the accounts.

During the year, the following changes have taken place in subsidiary companies:

Subsidiary companies formed/acquired:

- TMNL Motor Services Nigeria Limited was incorporated with effect from September 2, 2015

- Jaguar Land Rover Limited acquired Silkplan Limited with effect from April 16, 2015

Jaguar Land Rover Slovakia s.r.o was incorporated with effect from August 27, 2015

Jaguar Land Rover Singapore Pte. Limited was incorporated with effect from November 25, 2015

Jaguar Racing Limited was incorporated with effect from February 2, 2016

Inmotion Ventures Limited was incorporated with effect from March 18, 2016.

Companies ceasing to be subsidiary companies/ceased operations:

Land Rover Parts Limited was dissolved and struck off with effect from July 14, 2015

Name changes

-Jaguar e Land Rover Brasil Importacao e Comercia de Veiculos Ltda was renamed as Jaguar e Land Rover Brasil Industria e Comercio de Veiculos LTDA with eff ect from February 10, 2016

Capital Re-structuring/change in nature of Company

The Company''s entire shareholding in Sheba Properties Limited, a wholly owned subsidiary, was sold to Tata Motors Finance Limited, another direct subsidiary of the Company with effect from March 31, 2016

Tata Motors Finance Solutions Pvt. Ltd. was converted into a public limited company named Tata Motors Finance Solutions Ltd. with effect from June 4, 2015.

Besides the above, Jaguar Land Rover continued to integrate/ restructure legal entities for manufacturing and for exporting globally as combined brand legal entities. Other than the above, there has been no material change in the nature of business of the subsidiary companies.

Joint Ventures and Associate Companies

As at March 31, 2016, Tata Motors had 6 Associate Companies and 6 Joint Ventures. One of these Joint Ventures has 13 wholly owned subsidiaries, details of the same are disclosed in the accounts. During the year there were no changes in any of the Associates and Joint Ventures of the Company.

The Company has adopted a Policy for determining Materia Subsidiaries and is available on the Company''s website (www. tatamotors.com/investors/pdf/material.pdf).

ENERGY, TECHNOLOGY & FOREIGN EXCHANGE

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3) (m) of the Act, read along with Rule 8 of the Companies (Accounts) Rules, 2014, is annexed as Annexure 3.

CORPORATE GOVERNANCE

A separate section on Corporate Governance forming part of the Board''s Report and the certificate from the Practicing Company Secretary confirming compliance of Corporate Governance norms as stipulated in Regulation 34 read along with Schedule V of the SEBI Listing Regulations is included in the Annual Report.

DIRECTORS

Appointment

During the year under review, on the recommendation of Nomination and Remuneration Committee ("NRC") and in accordance with provisions of Section 161 of the Act, Mr Guenter Butschek was appointed as an Additional Director with effect from February 15, 2016 and holds office upto the date of the forthcoming Annual General Meeting ("AGM") and being eligible has offered himself for appointment as Director. Mr Butschek is appointed as Chief Executive Officer and Managing Director of the Company for a period of 5 years with effect from February 15, 2016, subject to approval of Members and the Central Government.

Re-appointment

Mr Ravindra Pisharody, Executive Director (Commercial Vehicles) is being re-appointed w.e.f July 1, 2016 upto November 24, 2020 (upon the termination of the existing contract w.e.f July 1, 2016) and in accordance with the provisions of the Act and the Articles of Association of the Company, Mr Pisharody retires by rotation and is eligible for re-appointment.

Mr Satish Borwankar, Executive Director (Quality) is being re-appointed w.e.f July 1, 2016 upto July 15, 2017 (upon the termination of the existing contract w.e.f July 1, 2016).

There was no change in the composition of the Board during Fiscal 2016, other than appointment of Mr Butschek, CEO and Managing Director of the Company.

The disclosures required pursuant to Regulation 36 of SEBI Listing Regulations are given in the Notice of the AGM, forming part of the Annual Report and disclosure pursuant to Schedule V, Part II, proviso of Section II B(iv)IV of the Act and Schedule V of SEBI Listing Regulations is annexed hereto as Annexure 4.

Attention of the Members is invited to the relevant items in the Notice of the AGM and the Explanatory Statement thereto.

Independent Directors

Pursuant to the provisions of Section 149 of the Act read along with the Rules framed thereunder and the Resolutions passed by the Members at the Annual General Meeting held on July 31, 2014, Mr N Munjee, Mr V K Jairath and Ms Falguni Nayar would continue as Independent Directors upto July 30, 2019. Mr Nusli Wadia, Dr Raghunath Mashelkar and Mr Subodh Bhargava would continue as Independent Directors upto February 14, 2019, December 31, 2017 and March 29, 2017, respectively, as per the Governance Guidelines adopted by the Company All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Act and Regulation 16 of the SEBI Listing Regulations.

KEY MANAGERIAL PERSONNEL

During the year under review, the Company designated Mr Guenter Butschek as Chief Executive Officer and Managing Director of the Company as one of the Key Managerial Personnel (KMP), under Section 203 of the Act, with effect from February 15, 2016. The following Directors/Executives continued as KMPs of the Company during Fiscal 2016:

Mr Ravindra Pisharody, Executive Director (Commercial Vehicles) Mr Satish Borwankar, Executive Director (Quality)

- Mr C Ramakrishnan, Group Chief Financial Officer *

- Mr Hoshang Sethna, Company Secretary

-(Superannuated on June 30, 2015 and Re appointed as Group Chief Financial Of cer w.e.f. July 1, 2015)

GOVERNANCE GUIDELINES

During the year under review, the Company adhered to the Governance Guidelines on Board Eff ectiveness. The Governance Guidelines cover aspects related to composition and role of the Board, Chairman and Directors, Board diversity, definition of independence, director term, retirement age and Committees of the Board. It also covers aspects relating to nomination, appointment, induction and development of directors, director remuneration, subsidiary oversight, Code of Conduct, Board Effectiveness Review and Mandates of Board Committees.

Selection and procedure for nomination and appointment of Directors

The NRC is responsible for developing competency requirements for the Board based on the industry and strategy of the Company. The Board composition analysis reflects in-depth understanding of the Company, including its strategies, environment, operations, financia condition and compliance requirements.

The NRC conducts a gap analysis to refresh the Board on a periodic basis, including each time a Director''s appointment or re- appointment is required. The Committee is also responsible for reviewing and vetting the CVs of potential candidates vis-à-vis the required competencies, undertake a reference and due diligence and meeting potential candidates, prior to making recommendations of their nomination to the Board. At the time of appointment, specific requirements for the position, including expert knowledge expected, is communicated to the appointee.

Criteria for Determining Qualifications, Positive Attributes and Independence of a Director

The NRC has formulated the criteria for determining qualifications, positive attributes and independence of Directors in terms of provisions of Section 178 (3) of the Act and Regulation 19 read along with Schedule II of SEBI Listing Regulations, which is annexed as Annexure 5.

REMUNERATION POLICY

The Company has in place a Remuneration Policy for the Directors, Key Managerial Personnel and other employees, pursuant to the provisions of the Act and Regulation 19 of SEBI Listing Regulations, and the same is annexed as Annexure 6.

BOARD EVALUATION

Pursuant to the provisions of the Act and the Corporate Governance requirements as prescribed by SEBI Listing Regulations, the Board has carried out an annual evaluation of its own performance and that of its Committees and individual Directors.

The performance of the Board and individual Directors was evaluated by the Board seeking inputs from all the Directors. The performance of the Committees was evaluated by the Board seeking inputs from the Committee Members. The NRC reviewed the performance of the individual Directors, a separate meeting of Independent Directors was also held to review the performance of Non-Independent Directors, performance of the Board as a whole and performance of the Chairman of the Company, taking into account the views of CEO and MD, Executive Directors and Non-Executive Directors. This was followed by a Board Meeting that discussed the performance of the Board, its Committees and individual Directors.

The criteria for performance evaluation of the Board included aspects like Board composition and structure, effectiveness of Board processes, information and functioning etc. The criteria for performance evaluation of Committees of the Board included aspects like composition of Committees, effectiveness of Committee meetings etc. The criteria for performance evaluation of the individual Directors included aspects on contribution to the Board and Committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings etc. In addition, the Chairman was also evaluated on the key aspects of his role.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

The details of the programme for familiarisation of the Independent Directors with the Company in respect of their roles, rights, responsibilities in the Company, nature of the industry in which Company operates, business model of the Company and related matters are put up on the website of the Company. (www.tatamotors. com/investors/pdf/familiarisation-programme-independent- directors.pdf ).

BOARD AND COMMITTEE COMPOSITION

Details of the composition of the Board and its Committees, Meetings held, attendance of the Directors at such Meetings and other relevant details are provided in the Corporate Governance Report.

BOARD MEETINGS

During the year under review, 10 Board Meetings were convened and held.

VIGIL MECHANISM

The Company has adopted a Whistle Blower Policy establishing vigil mechanism, to provide a formal mechanism to the Directors and employees to report their concerns about unethical behaviour, actual or suspected fraud or violation of the Company''s Code of Conduct or Ethics Policy. The Policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee. The Policy of vigil mechanism is available on the Company''s website (www.tatamotors.com/investors/ pdf/whistle-blower-policy.pdf/).

PARTICULARS OF EMPLOYEES

The information on employees who were in receipt of remuneration of not less than Rs.60 lakhs during the year or Rs.5 lakhs per month during any part of the said year as required under Section 197(12) of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided in the Annexure forming part of the Report. In terms of proviso to Section 136(1) of the Act, the Report and Accounts are being sent to the shareholders excluding the aforesaid Annexure. The said statement is also open for inspection at the registered office of the Company. Any member interested in obtaining a copy of the same may write to the Company Secretary.

Disclosure pertaining to remuneration and other details as required under Section 197(12) of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are Annexed to the report as Annexure 4.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

The brief outline of the Corporate Social Responsibility (CSR) Policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out in Annexure 7 of this Report in the format prescribed in the Companies (CSR Policy) Rules, 2014. The Policy is available on Company''s web-site (www.tatamotors.com/investors/ pdf/csr-policy-16-17.pdf ).

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS BY THE COMPANY

The details of Loans, Guarantees or Investments made under Section 186 of the Act during the year are given below:

(Rs. in crores)

Sr No. Companies Nature of Transaction Loans Guarantees Investments

1 TAL Manufacturing Solutions Limited Inter-corporate deposits 5.00 - -

2 Concorde Motors (India) Limited Inter-corporate deposits 15.00 -

3 Tata Marcopolo Motors Limited Inter-corporate deposits 25.00 - -

4 TAL Manufacturing Solutions Limited Investment in Rights Issue - - 15.00

5 Concorde Motors (India) Limited Investment in Rights Issue - - 45.00

6 Tata Hispano Motors Carrosseries Maghreb Investment in loans 58.32 - -

7 Tata Motors European Technical Centre Plc Investment in loans/shares 19.66 158.45* 73.09

8 Tata Motors Finance Limited Compulsory Convertible Preference # Shares with call option to TML

Notes:

(i) *Outstanding amount of Guarantee given to University of Warwick for development and funding of NAIC

(ii) #The Company has not invested through CCPS of Rs.434 crores The call option is available with the Company to acquire CCPS from investors.

(iii) Guarantees other than in connection with a loan given to any person is given under Note No. 30 (ii) (c) in the Standalone Financial Statements in the full Annual Report

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All contracts/arrangements/transactions entered by the Company during the financial year with related parties were on an arm''s length basis, in the ordinary course of business and were in compliance with the applicable provisions of the Act and SEBI Listing Regulations. There are no materially significant Related Party Transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

All Related Party Transactions are placed before the Audit Committee comprising Mr N Munjee, Chairman, Dr R A Mashelkar, Mr V K Jairath and Ms Falguni Nayar being Independent Directors of the Company, for its approval. A statement of all Related Party Transactions is placed before the Audit Committee for its review on a quarterly basis, specifying the nature, value and terms and conditions of the transactions.

The Company has adopted a revised Policy on Related Party Transactions to mainly incorporate changes pertaining to substitution of earlier Listing Agreement provisions with those of SEBI Listing Regulations and providing the parameters for granting omnibus approvals by the Audit Committee. The Policy, as approved by the Board, is uploaded on the Company''s website (www.tatamotors. com/investors/pdf/rpt-policy.pdf ).

During the Fiscal 2016, there have been no materially significant related party transactions between the Company and Directors, management, subsidiaries or relatives, as defined under Section 188 of the Act and Regulations 23 the SEBI Listing Regulations.

There are no transactions that are required to be reported in Form AOC-2 and as such does not form part of the Report.

AUDIT

In the 69th Annual General Meeting held on July 31, 2014, M/s. Deloitte Haskins & Sells LLP, (DHS), Chartered Accountants have been appointed Statutory Auditors of the Company for a period of 3 years. At the AGM held on August 13, 2015, the Members ratified the appointment of DHS for the 2nd year. Ratification of appointment of Statutory Auditors for the 3rd year is being sought from the Members of the Company at this AGM. Further, DHS have, under Section 139(1) of the Act and the Rules framed thereunder furnished a certificate of their eligibility and consent for appointment.

The report of the Statutory Auditors alongwith notes to Schedules is enclosed to this Report. The observations made in the Auditors''Report are self-explanatory and therefore do not call for any further comments.

The Auditor''s Report does not contain any qualification, reservation, adverse remark or disclaimer.

COST AUDIT

As per Section 148 of the Act, the Company is required to have the audit of its cost records conducted by a Cost Accountant in practice. The Board of the Company has on the recommendation of the Audit Committee, approved the appointment of M/s Mani & Co. having registration No.000004 as the Cost Auditors of the Company to conduct cost audits pertaining to relevant products prescribed under the Companies (Cost Records and Audit) Rules, 2014 as amended from time to time for the year ending March 31, 2017 at a remuneration of Rs.5 lakhs plus out of pocket expenses.

It may be noted that the records of the activities under Cost Audit is no longer prescribed for "Motor Vehicles and certain parts and accessories thereof". However, based on the recommendations of the Audit Committee, the Board has also approved the appointment of M/s Mani & Co. for submission of reports to the Company on cost records pertaining to these activities for a remuneration of Rs.15,00,000 (Rupees Fifteen Lakhs) for the said financial year.

M/s Mani & Co., have vast experience in the field of cost audit and have conducted the audit of the cost records of the Company for the past several years under the provisions of the erstwhile Companies Act, 1956.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s Parikh & Associates, a firm of Company Secretaries in practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit is annexed herewith as Annexure 8. The Secretarial Audit Report does not contain any qualifications, reservation, adverse remarks or disclaimer.

DIRECTORS''RESPONSIBILITY STATEMENT

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal, statutory, cost, external agencies and secretarial auditors, including audit of internal financial controls over financial reporting by the Statutory Auditors and the reviews performed by Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Company''s internal financial controls were adequate and effective during Fiscal 2016.

Accordingly, pursuant to Section 134(5) of the Act, the Board to the best of their knowledge and ability, confirm that:

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

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

(c) they have 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) they have prepared the annual accounts on a going concern basis;

(e) they have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and were generally operating effectively*; and

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

* please refer to the Section "Internal Control Systems and their Adequacy in the Management Discussion and Analysis Report".

ACKNOWLEDGEMENT

The Directors wish to convey their appreciation to all of the Company''s employees for their enormous personal efforts as well as their collective contribution to the Company''s performance. The Directors would also like to thank the employee unions, shareholders, customers, dealers, suppliers, bankers, Government and all the other business associates for the continuous support given by them to the Company and their confidence in its Management.

On behalf of the Board of Directors

CYRUS P MISTRY

Chairman Mumbai,

May 30, 2016


Mar 31, 2013

The Directors present their Sixty-Eighth Annual Report and the Audited Statement of Accounts for FY 2012-13.

FINANCIAL PERFORMANCE SUMMARY

(Rs. in crores)

Company Tata Motors Group (Standalone) (Consolidated)

FY 2012-13 FY 2011-12 FY 2012-13 FY 2011-12

FINANCIAL RESULTS

Gross revenue 49,319.73 59,220.94 193,583.95 170,677.58

Net revenue (excluding excise duty) 44,765.72 54,306.56 188,817.63 165,654.49

Total expenditure 42,621.98 49,894.76 162,248.74 141,954.02

Operating profit 2,143.74 4,411.80 26,568.89 23,700.47

Other income 2,088.20 574.08 811.53 661.77

Profit before interest, depreciation, amortization, exceptional item and tax 4,231.94 4,985.88 27,380.42 24,362.24

Finance cost 1,387.76 1,218.62 3,553.34 2,982.22

Cash profit 2,844.18 3,767.26 23,827.08 21,380.02

Depreciation, amortization and product development / engineering expenses 2,243.38 1,840.99 9,590.89 7,014.61

Profit for the year before exceptional items and tax 600.80 1,926.27 14,236.19 14,365.41

Exceptional items - loss (net) 425.87 585.24 602.71 831.54

Profit before tax 174.93 1,341.03 13,633.48 13,533.87

Tax expense/(credit) (126.88) 98.80 3,770.99 (40.04)

Profit after tax 301.81 1,242.23 9,862.49 13,573.91

Share of minority interest and share of profit of associates (net) - - 30.12 (57.41)

Profit for the year 301.81 1,242.23 9,892.61 13,516.50

APPROPRIATIONS

Profit for the year 301.81 1,242.23 9,892.61 13,516.50

Balance brought forward from previous year 1,663.91 2,078.92 18,195.96 6,461.49

Amount available for appropriations 1,965.72 3,321.15 28,088.57 19,977.99

Less: appropriations / (transfer from)

Debenture Redemption Reserve (130.00) 70.00 (130.00) 70.00

General Reserve 30.18 125.00 59.48 158.03

Other Reserves - - 63.14 65.38

Dividend (including dividend distribution tax) 722.75 1,462.24 756.14 1,488.62

Balance carried to Balance Sheet 1,342.79 1,663.91 27,339.81 18,195.96

DIVIDEND

Considering the Companys financial performance, the Directors recommended a dividend of Rs.2/- per share (100%) on the capital of 2,719,945,846 Ordinary Shares of Rs.2/- each [previous year: Rs.4/- per share (200%) of face value of Rs.2/- each] and Rs.2.10 per share (105%) on 481,959,620 A Ordinary Shares of Rs.2/- each [previous year: Rs.4.10 per share (205%) of face value of Rs.2/- each] fully paid-up and any further Ordinary Shares and/or A Ordinary Shares that may be allotted by the Company prior to August 1, 2013 (being the book closure date for the purpose of the said dividend entitlement) and will be paid on or after August 23, 2013. Based on the current paid- up capital, the said dividend, if approved by the Members, would involve a cash outflow of Rs.724 crores (previous year: Rs.1,464 crores) including dividend distribution tax, resulting in a payout of 240% (previous year: 118%) of the standalone profits for FY 2012-13 and 7% (previous year: 11%) of the consolidated profits of the Company.

OPERATING RESULTS AND PROFITS

FY 2012-13 was a challenging year for the economy - both globally and in India. The world economy grew by a mere 3.1% in 2012 as compared to 3.9% in the previous year. The domestic situation in India was influenced by these global trends and the ripple effect of a global slowdown was felt. After years of strong positive growth, the Indian economy slowed down to a GDP of 5% from 6.5% in the previous year.

The Tata Motors Group recorded a 13.4% growth in gross turnover from Rs.170,678 crores in the previous year to Rs.193,584 crores in FY 2012-13. This is the highest turnover recorded by the Group. The consolidated revenues (net of excise) for FY 2012-13 of Rs.188,818 crores grew by 14% over last year on the back of strong growth in volumes across products and markets at Jaguar Land Rover. The consolidated EBITDA margins for FY 2012-13 stood at 14.1%. Consequently, Profit Before Tax and Profit After Tax were Rs.13,633 crores and Rs.9,893 crores, respectively.

Tata Motors Limited recorded a gross turnover of Rs.49,320 crores, 16.7% lower from Rs.59,221 crores in the previous year. Weak macro economic factors leading to a continued slow-down in the Medium and Heavy Commercial Vehicles (M&HCV), stiff competition, mainly in Passenger Vehicles business, severely affected the standalone operations and profitability. Additionally, the need to increase marketing expenses to protect and grow market share has resulted in EBITDA margins reducing from 8.1% to 4.8% for FY 2012-13. The reduction of profits from operations was offset by dividend from subsidiary companies of Rs.1,584 crores (including dividend from JLR) as compared to Rs.114 crores for the previous year. The Profit Before Tax and Profit After Tax for the FY 2012- 13 were lower at Rs.175 crores and Rs.302 crores, respectvely, as compared to Rs.1,341 crores and Rs.1,242 crores in the previous year, respectively.

Jaguar Land Rover recorded a turnover of GB£ 15,784 million, a growth of 17% from GB£ 13,512 million in the previous year. Volume growth was driven not only by a full year of the Range Rover Evoque, but also by increasing sales of existing models. EBITDA growth also benefitted from a favourable market mix, operating exchange rates due to the strengthening US$ against the GB£ and the Euro. Further, cost efficiency improvements in material costs and manufacturing costs supported by increased production volume levels also attributed to improved results of operations. These resulted in a higher EBITDA and Profit Before Tax of GB£ 2,402 million and GB£ 1,675 million, respectively, as compared to GB£ 2,027 million and GB£ 1,507 million, respectively in the previous year. The effective tax rate was higher than the previous year, since last year it benefitted from recognition of previously unrecognised tax losses in the last year. The Profit After Tax for FY 2012-13 stood at GB£ 1,215 million as compared to GB£ 1,481 million last year (Jaguar Land Rovers figures as per IFRS).

Tata Motors Finance Limited, the Companys captive financing subsidiary, registered total revenue of Rs.2,890 crores higher by 43% in the previous year and reported a Profit After Tax of Rs.309 crores in FY 2012-13 (previous year: Rs.240 crores). Tata Motors Finance Limited proposed a dividend of 7% per equity share for FY 2012-13.

Tata Daewoo Commercial Vehicle Company Limited, South Korea registered revenues of KRW 823.9 billion (Rs.4,017 crores), a growth of 8% over the previous year. However, the positive impact of higher volumes and various cost control initiatives were negated by a provision of KRW 18.9 billion (Rs.92 crores) on account of a Court verdict in an ordinary wage suit filed by its Union employees resulting in a loss of KRW 9.2 billion (Rs.45 crores) (previous year: profit of Rs.8.74 crores).

VEHICLE SALES AND MARKET SHARES

The Tata Motors Group sales for the year stood at 11,91,968 vehicles, lower by 6% as compared to the previous year. Global sales of all Commercial Vehicles were 593,897 vehicles, while sales of Passenger Vehicles were at 598,071 vehicles.

TATA MOTORS

The Company recorded sales of 765,557 vehicles, a decline of 11% over last year. Industry growth during the year was also muted at 1.1%, resulting in the Companys market share decreasing to 22% in the Indian automotive industry from 25.1% in the previous year. The Company exported 50,938 vehicles during the year, lower by 19%, as compared to the previous year.

Commercial Vehicles

Within the domestic market, the Company continued to strengthen its presence in Commercial Vehicles, with sales of 5,36,232 vehicles, an all time high for the Company, growing 1.1% from the previous year. T his represented a market leadership share of 59.5% in the domestic CV market which was mainly supported by steep growth in the LCV segment.

Some of the highlights for the year were:

- Sales in the LCV segment continued to drive performance, growing by a 21.8% during the year to 3,93,468 vehicles. Market share in the LCV segment expanded by 200 basis points registering a 62.2% market share in FY 2012-13. The Company has grown and consolidated its position in the LCV segment, leading to expansion of the market share, especially in the Ace Segment. Sales of the Tata ACE reached highest ever at over 3,25,000 during FY 2012-13. The Tata Ace family crossed 10,00,000 sales since its launch. During this year, the Company launched Tata Xenon, a stylish and rugged pick-up, offering both single cab and dual cab versions, with best in class looks, operating economies and fuel efficiency

- Slowdown in economic activity, sluggish infrastructure spending and weak macro outlook coupled with higher operating costs for transport operators, adversely impacted demand in the M&HCV industry. The M&HCV segment which is the harbinger for growth in the economy de-grew by 23.3% in the year. The Companys sales in the M&HCVs segment were 1,42,764 vehicles. The depressed market scenario combined with new player entry resulted in very high competitive intensity. Several new products and variants across the traditional, Prima and Construck range focusing on best in class performance, reliability and fuel efficiency, were introduced.

- The year also marked the roll-out of the two millionth truck from the Companys manufacturing facility at Jamshedpur. The plant manufactures the Companys entire range of M&HCV trucks, including the Tata Prima, both for civilian and defence applications. Many first of its class heavy trucks designed and built specifically to offer best in class performance, reliability and fuel efficiency were introduced viz - Tata LPT 3723 - the first 5 axle rigid truck in the country in the 10 x 4 configuration, the Tata Prima 3138.K Tipper, the Tata Prima 4938.S tractor and the Tata Prima 230 HP - LX range consisting of Tata Prima LX 4923.S, Tata Prima LX4023.S and Tata LPK 3118 tipper. Launches of buses such as MCV buses for intercity (AC - 45 Seater) and staff transportation (Non AC - 41 Seater), LP/ LPO Starbus Ultra with best in class features and fuel efficiency tailored to suit Indian conditions with highest capacity school bus in ICV platform in India (56 seats).

In January 2013, Tata Motors became the first company in India to introduce warranty period of four years on heavy trucks. The Company also introduced a Telematics and Fleet Management Service, branded "Tata FleetMan an intelligent vehicle and driver management solution.

Passenger Vehicles

The domestic passenger car industry was affected mainly by weak sentiments, high cost of ownership, high interest rates, fuel prices and reduction in discretionary spends. Overall growth in Domestic Passenger vehicle industry was flat in FY 2012-13, within which Utility Vehicles recorded a robust growth of 51.5% on the back of new launches catering not only to the traditional rugged SUV customers but also to the customer preferring the more car-like soft roader utility vehicles and cars segment de-grew by 6.9%.

During the year, the Companys Passenger Vehicles sales were lower by 31.1% at 2,29,325 vehicles, registering an 8.9% market share. The Company sold 1,80,520 cars and 48,805 utility vehicles and vans, lower by 34.6% and 14.4% respectively, over the previous year. The Companys sales in the mid-size segment suffered as competitive activity intensified with multiple new launches in this segment. The Company has taken various initiatives to improve its product refreshes/launch programmes, operational efficiency, dealer effectiveness, working capital management and restructuring customer facing functions.

The Company sold 2,294 vehicles of Jaguar Land Rover brands during FY 2012-13. Network for these brands continued to grow with 17 operational outlets across 15 cities in the Country by the year end. The plant in Pune expanded its capacity and commenced operations to roll out locally built Jaguar XF in India from November 2012.

Some of the highlights of this years performance were:

- Launches of the Vista D90; and refreshed Tata Indica eV2, the most efficient car in its class with a mileage of 25 kmpl, with new exteriors and additional convenience features.

- Launched the Manza Club Class with first in class features like 6.5 infotainment screen with voice enabled GPS guidance system, infinity roof, premium Italian leather seating system and plush interiors.

- Launched the Tata Safari Storme with new interiors and improved performance - disc brake on all wheel and projector lens head lamp - first time in its class and Tata Aria Pure LX - a new variant with a bouquet of features, at a stunning price.

- Launched the Nano MY13 with features like music system with Bluetooth/USB, glove box, refreshed interiors, etc., in an array of colours.

The above launches of the Nano MY13, Manza, Vista D90 and the Safari Storme were in-line with the Companys objective of taking the brand to a higher level, while making it relevant for the younger buyer.

- Showcased the Vista Extreme, a concept that combines the package efficiency of a hatch with the usability of the modern urban Utility Vehicle.

- The Company continued to focus on building brand strengths, refreshing the products and enhancing sales and service experience. The Company also introduced a new look, stylish, tech savvy best in class flagship Passenger Vehicle showrooms, for superior customer experience at pilot dealership in Mumbai and Delhi and this initiative will now be replicated to other setups across the country.

A new leadership team in the Passenger Vehicle business was in place towards the latter half of the year with rich experience not only from the automotive but from other sectors as well. The Company is working on a customer-centric strategy for providing the best customer experience with focus on products, world class manufacturing practices, purchase experience and consistent quality of services. As a precursor to future launches, the Company would be shortly unveiling improved and enhanced vehicles across its key brands.

Exports

For Tata Motors, traditionally strong markets in South Asia such as Bangladesh and Sri Lanka also were affected by internal conflict, political unrest and regulatory changes. As a result, export sales of the Company de-grew by 19.3% to 50,938 vehicles. With a view to expand its International Business, the Company re-entered the market of Saudi Arabia to re-establish its business in the Kingdom and launched its brand at the Jakarta Auto Show to address the Indonesian market - a key growth market. The Company introduced a host of new products on existing and new platforms in existing and new markets and showcased its vehicles in major auto shows in strategically important markets.

The Company continued to outperform competition in terms of exports of Commercial Vehicles and enjoyed a total exports share of 57% in FY 2012-13, exporting 44,109 Commercial Vehicles. The Company exported 6,829 Passenger Vehicles. Aria witnessed growth in shipments led by a strong push into European markets. Indica grew due to strong fleet and entry level customer demand and Manza grew albeit over a low base, in South Africa. Other UVs - Safari, Sumo and Grande, showed growth led by the revival of demand in Nepal and Sub-Saharan Africa. Nano and Indigo were the only significant under-performers due to economic and political upheavals in key markets - Sri Lanka and Nigeria.

Some of the highlights of this years performance were:

- Inaugurated its first 3S (Sales, Service and Spares) setup in Yangon, Myanmar.

- Won a tender for supplying 449 vehicles to Kuwait Municipality, Prestigious order for supply of 715 Xenons from the US Army.

- Started Driver Training School in Bangladesh and Mechanic Training Centre in South Africa and Kenya.

JAGUAR LAND ROVER

Jaguar Land Rover has had a successful year of continued growth in all markets, despite uncertain trading conditions globally. Jaguar Land Rover sold 372,062 vehicles in FY 2012-13, an increase of 18.3% over the previous year. At the brand level, wholesale volumes were 57,812 vehicles for Jaguar and 314,250 vehicles for Land Rover, growing 7% and 20.7%, over the previous year, respectively. All market regions have grown, led by China where retail sales at 77,075 vehicles were up by 48% over previous year. Retail volumes in Europe were 80,994 vehicles, 18% increase over the previous year. UK retail volumes were 72,270 vehicles, a 20% increase, whilst the North American retail volumes were 62,959 vehicles, an increase of 9% over the previous year. Retail sales for the Asia Pacific region at 17,849 vehicles, were higher by 27% and for the rest of the world were 19% higher at 63,489 vehicles over the previous year.

Jaguar Land Rover has a multifaceted strategy to position itself as a leading manufacturer of premium vehicles offering high-quality products tailored to specific markets. T he companys success is tied to its investment in product development and market expansion which drives the strategic focus on product design and quality.

Jaguar Land Rover operates three major production facilities and two advanced design and engineering facilities all in the United Kingdom. Jaguar Land Rover markets products in 178 countries, through a global network of 17 national sales companies (NSCs), 85 importers, 62 export partners and 2,485 franchise sales dealers, of which 689 are joint Jaguar and Land Rover dealers.

With the objective of increasing its marketing and dealer networks in emerging markets, Jaguar Land Rover established a National Sales company in China in 2010 to expand its presence and has plans to increase its network of dealers in China. Similar plans of increasing its dealer network are also underway in India. Jaguar Land Rover also aims to establish new manufacturing facilities, assembly points and suppliers in select markets. T he joint venture with Chery Automobiles, China as also an established manufacturing operation for some of its products and product development activities in India are examples of these initiatives.

Some of the highlights of this years performance were:

- Launch of the all new aluminum Range Rover in December 2012, with a world-wide roll-out in the last quarter of the year, recording sales of over 13,000 vehicles in the first four months. The Range Rover has already received over 10 global awards including WhatCar? Best Luxury Car.

- Launch of the all new aluminum Range Rover Sport in March 2013, with a world wide roll out in the first half of FY 2013-14.

- Expanded the Jaguar XF range with an all wheel drive version and a new Sportbrake and introduced a more fuel efficient, 2.0l XF with an 8 speed automatic gear box.

- Introduction of new variants of the Jaguar XF, the launch of the new Range Rover, as well as the continued strength of the Evoque, were key contributors to the overall success.

- Jaguar Land Rovers joint venture with Chery Automobiles, China has been formalised to develop, manufacture and sell certain Jaguar and Land Rover vehicles and jointly branded vehicles for the Chinese market.

- Continued investment in new state-of-the-art facility at Wolverhampton, UK, to manufacture new advanced low emission engines.

Jaguar Land Rover and Tata Motors participated in various international autoshows displaying its range of products, including at Geneva, New York, Detroit and Jakarta, wherein the displayed products won accolades and a positive response.

TATA DAEWOO COMMERCIAL VEHICLES COMPANY LIMITED

Tata Daewoo Commercial Vehicles Company Limited (TDCV) sold 10,100 vehicles- higher by 6% over the previous year. TDCV exported 4,700 vehicles in FY 2012-13, which is the highest ever in its history, registering a growth of 57.8% as compared to 2,979 vehicles exported in the previous year. However, in the domestic market, sales decreased by 17.6% to 5,400 vehicles as against 6,552 vehicles sold in the previous year, due to economic slowdown.

TATA MOTORS (THAILAND) LIMITED

Tata Motors (Thailand) Ltd. (TMTL) sold 4,905 vehicles in FY 2012-13. These included Tata Xenon pickups, Super Ace and heavy commercial vehicles. During FY 2012-13, TMTL launched three additional variants of the pickup, tailor-made for the T hailand commercial vehicle market. In the single cab segment, which is used predominantly by the commercial users, Xenon continues to be ranked fourth amongst eight players in the segment.

TATA MOTORS (SA) (PROPRIETARY) LIMITED

Tata Motors (SA) (Proprietary) Limited (TMSA) sold 864 vehicles during FY 2012-13. During the year, TMSA introduced four new models of commercial vehicles and crossed a major milestone of rolling out its 1,000th vehicle since start of operations last year.

TATA MOTORS FINANCE LIMITED

The vehicle financing activity under the brand "Tata Motors Finance" (TMF) of Tata Motors Finance Limited (TMFL) - a wholly owned subsidiary company, continued to show improved financial results inspite of challenging market conditions and rising costs of funds.

With the Companys increased focus on financing of small commercial vehicles, the total disbursements for the year were at Rs.11,180 crores - 6% higher than disbursements of Rs.10,505 crores in the previous year. A total of 2,51,936 vehicles were financed representing an increase of 9.3% over the previous year. The disbursals for commercial vehicle were Rs.8,816 crores (1,81,374 vehicles) in FY 2012-13 compared to Rs.7,204 crores (1,20,032 vehicles) for previous year. For passenger cars, disbursals were Rs.2,364 crores (70,562 vehicles) in FY 2012-13 compared to Rs.3,301 crores (1,10,556 vehicles) in the previous year. The overall market share in terms of the Tata vehicle unit sales in India financed by Tata Motors Finance increased from 27% to 33% - led by significant increase in commercial vehicle market share from 23% to 34%.

Tata Motors Finance Limited continued to expand its reach in the market place by growing its branch network and expanding its support to Tata Motors dealership network. Significant increase in its manpower resources as well as driving IT technology to improve productivity and output, ensures that Tata Motor Finance now reaches to over 75% of the dealers. With greater attention being placed on further enhancing customer experience through its "Office of the Customer" T MFL is confident of continuing to deliver profitable growth in the future.

HUMAN RESOURCES

The Tata Motors Group employed 62,716 permanent employees (previous year: 58,618 employees) as of the year end out of which 56,393 employees were engaged in automotive operations. The increase over last year was mainly at Jaguar Land Rover in view of volume and product development activity. The Company employed 29,965 permanent employees (previous year: 29,217 employees) as of the year end. T he Tata Motors Group has generally enjoyed cordial relations with its employees and workers.

All employees in India belonging to the operative grades are members of labour unions except at Sanand and Dharwad plants. All the wage agreements have been renewed in a timely manner and are all valid and subsisting. Operatives and Unions support in implementation of reforms that impact quality, cost erosion and improvements in productivity across all locations is commendable.

SAFETY & HEALTH - PERFORMANCE & INITIATIVES

Safety is an integral part of the Companys operations and is reviewed at the highest levels including the Board, Executive Committee, and the Safety, Health and Environment (SHE) Council. The Board constituted a SHE Committee and also adopted its charter during the year. The senior leadership is fully committed to the ultimate goal of zero injury to its employees and all those who work in our facilities. In its 3 year journey with DuPont, the organization is progressing aggressively with the vision of "Excellence in Safety". In association with DuPont 489 internal trainers have been developed and 2,058 employees are trained on leading safety efforts, safety management fundamentals, incident investigations, contractor safety management and safety. Defensive Driving Training was imparted to more than 8,000 employees and contractors who drive on business purpose or who are involved in operations.

A revised Safety & Health Policy has been cascaded which reflects an increased commitment towards our visitors, contractors and business partners. A structured review mechanism of safety performance is in place with Lead and Lag indicators, major incidents and High Potential Incidents (HIPO) announcements being made monthly to the senior management and leaders. The Lost Time Injury (LTI) rate for the year under review is lower at 0.68%, a reduction of 37% over the previous year. Improved governance in incident reporting with speedy investigations and corrections, and a collaborative functioning of Safety Committees across plants have led to an integrated organisation structure.

The Company, in a collaborative initiative with Castrol India Limited, is integrating safety expertise and knowledge in dealer workshops and a safety manual has been released with the objective of reducing potential risks and improve SHE practices.

This year has witnessed a significant improvement in Areas Beyond Factory Gates including warehouses, offices and channel partners, wherein structured audits, trainings and reporting have been initiated.

At Jaguar Land Rover, the health and safety management system is based on the UK Health and Safety Executives guidance for Health and Safety Management - HSG65. Jaguar Land Rovers Occupational Health Department achieved re-accreditation to the SEQOH Standard (Safe Effective Quality Occupational Health Standard) for its activities and management systems. Jaguar Land Rovers growth plans have resulted in an increased headcount and a larger number of contractors are involved in civil and engineering activities requiring extensive inputs from a health and safety perspective. This has been met with an incremental rise in Health and Safety training, induction programmes and continued focused events around skilled workers being recruited into relevant functions. The business has continued its programme of proactive health promotion events for employees and has launched several Wellbeing Centres to aid in worker assessment, rehabilitation and piloted electronic WellPoint kiosks to allow employees to monitor their own health data and seek further advice.

At TDCV, Korea, the accident rate and the safety index at 0.18% and 2.9 were lower than 0.48% and 2.40, respectively, for the previous year. At TMTL, Thailand, the performance has been improving with increased safety trainings and reduction in the number of incidents. At TMSA, South Africa, 5 LTIs were reported, Safety Management Systems were deployed and several initiatives taken to improve safety and working conditions.

FINANCE

During the year, the free cash flows for Tata Motors Group were Rs.3,342 crores, post spend on capex, design and development of Rs.18,720 crores. Tata Motors Groups borrowing as on March 31, 2013, stood at Rs. 53,591 crores (previous year: Rs. 47,149 crores). Cash and bank balances stood at Rs. 21,113 crores (previous year: Rs.18,238 crores).

Cash flows from operations were Rs.2,258 crores for standalone operations of the Company. Spend on capex, design and development were Rs.2,588 crores (net). The borrowings of the Company as on March 31, 2013 stood at Rs.16,799 crores (previous year: Rs.15,881 crores). Cash and bank balances stood at Rs.463 crores (previous year: Rs.1,841 crores).

During the year, the Company repaid the Zero Coupon Convertible Alternate Reference Securities (CARS) amounting to US$ 623.38 million, (Rs.3,493.83 crores) inclusive of a redemption premium of US$ 150.38 million. Consequent upon exercise of conversion option by the holders of 4% Foreign Currency Convertible Notes, aggregating Rs.342 crores (including Rs.141.62 crores in May 2013), the Company allotted 28,308,896 Ordinary Shares/ Shares represented by ADSs (including 11,789,695 Ordinary Shares/ Shares represented by ADSs in May 2013).

The Company also repaid Tranche 2 of Rs.446 crores of Secured, Rated, Credit Enhanced, Listed, 2% Coupon Non-Convertible Debentures (NCDs) inclusive of premium on redemption of Rs.96 crores. Further, the Company also repaid Rs.1,747 crores forming part of the public fixed deposit scheme launched in December 2008.

The Company issued rated, listed, unsecured, non-convertible debentures of Rs.2,100 crores. Further Rs.900 crores were issued in April and May 2013.

Due to significant reduction in volumes, the Company had to deploy short term funds to support critical long term finance needs. The Company is in the process of taking appropriate steps to increase the long term funds.

At Jaguar Land Rover, post spend on capex, design and development of GB£ 1,846 million (Rs.16,814 crores), the free cash flows were GB£ 583 million (Rs.4,885 crores) for FY 2012-13. The borrowings of the Jaguar Land Rover as on March 31, 2013, stood at GB£ 2,167 million (Rs.17,791 crores) [previous year: GB£ 1,974million (Rs.16,206 crores)]. Cash and bank balances stood at GB£ 2,847million (Rs.23,373 crores) [previous year: GB£ 2,430 million (Rs.19,950 crores)] resulting in negative net debt position. Additionally, JLR has undrawn committed bank lines of GB£ 865 million (as per IFRS).

In January 2013, Jaguar Land Rover issued US$ 500 million Senior Notes due 2023, at a coupon of 5.625% per annum. This was an opportunistic fund raising which enabled Jaguar Land Rover to reinforce its market acceptance and demonstrated the continued confidence of the investors. This was a further step taken towards strengthening capital structure and enhancing the debt maturity profile.

TML Holdings Pte Ltd, Singapore, a 100% subsidiary of the Company, holding the investment in Jaguar Land Rover raised Senior Notes aggregating SG$ 350 million in May 2013.

Tata Motors Finance Limited raised Rs.100 crores by an issue of unsecured, non-convertible, subordinated perpetual debentures towards Tier 1 and Tier 2 Capital and Rs.90.40 crores by an issue of unsecured, non-convertible, subordinated debentures towards Tier 2 Capital in order to meet its growth strategy and improve its Capital Adequacy ratio.

With healthy profitability and cash flow generation, the Consolidated Net Automotive Debt to Equity Ratio stood at 0.24:1on March 31, 2013, as compared to 0.25:1 on March 31, 2012.

Tata Motors Group has undertaken and will continue to implement suitable steps for raising long term resources to match fund requirements and to optimise its loan maturity profile.

During the year, the Companys rating for foreign currency borrowings was revised upwards by Standard & Poors to "BB"/ Positive and was retained at existing levels by Moodys at "Ba3"/ Stable. For borrowings in the local currency, the outlook on the ratings was improved from "Stable" to "Positive" and the rating stood at "AA-"/Positive by Crisil and at "AA-"/Positive by ICRA. The Non Convertible Debentures are rated by CARE at "AA"

During the year, Jaguar Land Rovers rating for was revised upwards by Standard & Poors to " BB-"/Positive. As on March 2013, the other ratings stood "B1 "/Stable by Moodys and "BB-"/Stable by Fitch.

For Tata Motors Finance, CRISIL revised its rating outlook on long- term debt instruments and bank facilities to CRISIL AA - Positive from CRISIL AA - Stable. The ratings on the short-term debt instruments and bank facilities were reaffirmed at CRISIL A1+.

FIXED DEPOSITS

The Company has not accepted any public deposits during FY 2012-13. As on March 31, 2013, the Company had deposits aggregating Rs.314.14 crores from 11,338 investors. There were no overdues on account of principal or interest on public deposits other than the unclaimed deposits as at the year end.

INFORMATION TECHNOLOGY INITIATIVES

The Company continues to leverage InformationTechnology (IT) as a key enabler of its strategy, business growth and competitiveness. IT provides employees, customers, suppliers, dealers and business partners with best in class technology solutions. IT leverages strong partnerships with product and services companies to support business growth and innovation.

The Company and JLR entered into a major long term outsourcing agreement with Tata Consultancy Services Ltd (TCS) after a rigorous two year long competitive process. This will harmonise and standardise the IT services, service level agreements and standards across the Tata Motors Group and lead to efficiencies in operations and lower IT costs.

Other major highlights of IT at group level are -

- The Companys unique CRM solution crossed 4,000 channel partner locations and 40,000 users interacting with customers, augumented by 1,000+ agent call centers.

- TDCV Korea implementing CRM, leveraging TML CRM capabilities.

- Tata Motors Indonesia implementing SAP and CRM leveraging base capabilities.

- JLR global expansion to China is being ably supported by IT capabilities.

- JLR SAP implementation is progressing smoothly, including implementation in NSCs in major markets.

- Developing key business capability enhancement initiatives like Analytics, Telematics, and Mobility solutions.

In addition, product development processes in the Company continue to grow on best of the breed tools and technology solutions, for enhancing product development capabilities, addressing quality and speed. Digital product validation processes have evolved to provide solutions in key areas:

- Enhanced Digital Manufacturing Planning capabilities.

- In-house developed productivity improvement tools like Digital Vault were rolled out.

- In-house Knowledge Based Engineering (KNEXT) applications spread and enhanced in various product design functions.

- State-of-the-art visualization capabilities in digital product engineering review process is implemented.

Tata Motors Group continue their collaboration in various Information Technology areas with synergies being explored for cross utilization of IT capabilities. The Group companies are working together in areas of ERP, outsourcing and technologies. Tata Technologies continues to be a strategic partner in strengthening Tata Motors Groups IT capabilities in process transformation through technology.

TECHNOLOGY AND ENVIRONMENT FRIENDLY INITIATIVES

The Tata Motors Group continues to innovate, with a view to enhance the market share and aims at products, which cater to the changing needs of the customer for both fleet owners and individual customers. Besides new product developments covered above, some of the key initiatives on Environment friendly technologies include:

- Fuel efficiency improvement through development of advanced oil formulation.

- Fuel efficiency improvement initiatives on 4 cylinder and 6 cylinder engines of LCV, M&HCVs through various engine measures such as Exhaust Gas Recirculation (EGR), common rail including latest software features in engine management system.

- 1.2 L Bi-fuel CNG engine development for passenger car.

- Bi-fuel CNG and Gasoline 273 MPFI engine for Nano.

- Demonstrated a Mild Hybrid technology on Nano with advance engineering functions for enhancing the CO2 emission.

- Nano Diesel variant is being developed with Electric Power Assist Steering (EPAS) for enhancing the ease of driving and good fuel economy.

- Vista has been made compliant to the Euro V emission requirement with better drivability and higher technology features.

- CNG variant of the Indigo CS is ready for launch in the market.

SUBSIDIARY AND ASSOCIATE COMPANIES

Tata Motors announces consolidated financial results on a quarterly basis. As required under the Listing Agreement with the Stock Exchanges, Consolidated Financial Statements of the Tata Motors Group are attached.

Pursuant to the provisions of Section 212(8) of the Companies Act, 1956 (the Act), the Ministry of Corporate Affairs vide its General Circular No 2/2011 dated February 8, 2011, has granted a general exemption subject to certain conditions to holding companies from complying with the provisions of Section 212 of the Act, which requires the attaching of the Balance Sheet, Profit & Loss Account and other documents of its subsidiary companies to its Balance Sheet. Accordingly, the said documents are not being included in this Annual Report. The main financial summaries of the subsidiary companies are provided under the section Subsidiary Companies: Financial Highlights for FY 2012-13 in the Annual Report. The Company will make available the said annual accounts and related detailed information of the subsidiary companies upon the request by any member of the Company or its subsidiary companies. These accounts will also be kept open for inspection by any member at the Registered Office of the Company and the subsidiary companies.

SUBSIDIARY COMPANIES

Tata Motors had 64 (direct and indirect) subsidiaries (10 in India and 54 abroad) as on March 31, 2013, as disclosed in the accounts. During the year, the following changes have taken place in subsidiary companies:

Subsidiary companies formed/acquired

- Jaguar Land Rover India Limited - an indirect subsidiary of Jaguar Land Rover Automotive PLC

- PT Tata Motors Distribusi Indonesia - a wholly owned subsidiary of PT Tata Motors Indonesia Companies ceasing to be subsidiary companies

- Tata Engineering Services (Pte) Ltd. - struck off from the Register of Accounting and Corporate Regulatory Authority (ACRA).

- Miljobil Greenland AS, upon liquidation of TMETCs shareholding Name changes

- Jaguar Cars Limited to Jaguar Land Rover Limited

- Jaguar Land Rover PLC to Jaguar Land Rover Automotive Plc

Besides the above, Jaguar Land Rover continued to integrate / restructure legal entities for manufacturing and for exporting globallly as combined brand legal entities. Other than the above, there has been no material change in the nature of the business of the subsidiary companies.

ASSOCIATE COMPANIES

As at March 31, 2013, Tata Motors had 8 associate companies and 4 Joint Ventures as disclosed in the accounts.

ENERGY, TECHNOLOGY & FOREIGN EXCHANGE

Details of energy conservation and research and development activities undertaken by the Tata Motors alongwith the information in accordance with the provisions of Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, are given as an Annexure to the Directors Report.

DIRECTORS

Mr Ratan N Tata stepped down as the Chairman and Director of the Company on December 28, 2012, in accordance with the Policy for Retirement Age of Non-Executive Directorsadopted by the Company. Mr Tata who was appointed on the Companys Board in 1981 and later as the Executive Chairman in 1988, had through his bold vision and strategic leadership and commitment to the Company transformed it from a domestic truck company to a complete automobile company with path breaking products such as the Indica and the Nano. Thereafter it was his understanding of the global dimensions and dynamics of the automobile business and his vision that led to the Company deciding to takeover Jaguar Land Rover in the UK. The transformation of Jaguar Land Rover through the change in its culture and the approach to its business led by Mr Tata has resulted in transforming Jaguar Land Rover into a profitable and successful company.

Mr Tata was on the Board for more than 30 years and was the Chairman of the Executive Committee of the Board and a member of the Remuneration and Nominations Committees. The Directors place on record the immeasurable debt the Company owes to Mr Tata for the visionary leadership, strategic direction and stewardship so liberally given to the Company and in recognition of his immense contribution and great service to the Company, the Board conferred upon Mr Tata the title of Chairman Emeritus. The traditions and values that he strove to imbibe will remain the guiding principles for this Company in the coming years.

Mr Sam M Palia, Non Executive, Independent Director of the Company since May 2006, on completing the age of 75 years on April 25, 2013, retired as per the Policy for Retirement Age of Non-Executive Directors adopted by the Company. Besides being a Board member, Mr Palia was also an active member of the Audit Committee and Nominations Committee and Chairman of the Investors Grievance Committee and Ethics and Compliance Committee. Mr Palia was also designated as the Audit Committee financial expert as required under the Sarbanes Oxley Act and NYSE Listing Agreement. Mr Palia had by his counsel and guidance, significantly contributed to deliberations at the Board and Committee meetings. The Board also placed on record its appreciation for the contributions made and the role played by Mr Palia as an independent director of the Company Mr Ranendra Sen, Non Executive, Independent Director of the Company since June 2010, resigned from the Board of Directors of the Company with effect from October 16, 2012, due to personal reasons. The Board placed on record its appreciation of the contributions made by Mr Sen during his tenure on the Companys Board as an independent director of the Company Mr Cyrus P Mistry was appointed as the Chairman of the Company with effect from December 28, 2012, consequent upon Mr Ratan N Tatas retirement. Tata Steel had vide their letter dated March 28, 2013, nominated Mr Cyrus P Mistry as the Steel Director pursuant to Article 127 of the Companys Articles of Association in place of Mr Ratan N Tata.

Mr Karl J Slym and Ms Falguni S Nayar were appointed as an Additional Directors w.e.f. September 13, 2012 and May 29, 2013, respectively. In accordance with Section 260 of the Companies Act, 1956 (the Act) and Article 132 of the Companys Articles of Association, they will cease to hold office at the forthcoming Annual General Meeting and are eligible for appointment. Mr Slym was also appointed as the Managing Director of the Company for a period of 5 years with effect from September 13, 2012, subject to the approval of the Members and the Central Government. An abstract and memorandum of interest under Section 302 of the Act, has been sent to the Members of the Company.

In accordance with the provisions of the Act and the Articles of Association of the Company, Mr Nusli N Wadia and Dr Raghunath A Mashelkar are liable to retire by rotation and are eligible for re- appointment. Attention of the Members is invited to the relevant items in the Notice of the Annual General Meeting and the Explanatory Statement thereto.

CORPORATE GOVERNANCE

A separate section on Corporate Governance forming part of the Directors Report and the certificate from the Practicing Company Secretary confirming compliance of Corporate Governance norms as stipulated in Clause 49 of the Listing Agreement with the Indian Stock Exchanges is included in the Annual Report.

PARTICULARS OF EMPLOYEES

The Information on employees who were in receipt of remuneration of not less than Rs.60 lakhs during the year or Rs.5 lakhs per month during any part of the said year as required under Section 217(2A) of the Companies Act, 1956 and the Rules made thereunder is provided in the Annexure forming part of the Report. In terms of Section 219(1)(b)(iv) of the Act, the Report and Accounts are being sent to the shareholders excluding the aforesaid Annexure. Any member interested in obtaining a copy of the same may write to the Company Secretary.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

A separate section on initiatives taken by the Tata Motors Group to fulfil its Corporate Social Responsibilities is included in the Annual Report.

BUSINESS RESPONSIBILITY REPORT

Vide its Circular dated August 13, 2012, Securities and Exchange Board of India (SEBI) mandated the inclusion of Business Responsibility Report (BRR) as a part of the Annual Report for top 100 listed entities based on their market capitalisation on BSE Limited and National Stock Exchange of India Limited, as on March 31, 2012. The said reporting requirement is in line with the National Voluntary Guidelines on Social, Environmental and Economic Responsibilities of Business (NVGs) notified by Ministry of Corporate Affairs, Government of India, in July, 2011. Pursuant to the above, the Stock Exchanges amended the Listing Agreement by inclusion of Clause 55 providing a suggested framework of a BRR, describing initiatives taken by the Company from an environmental, social and governance perspective. In line with the press release and FAQs dated May 10, 2013, issued by SEBI, the Companys BRR is hosted on its website www.tatamotors. com. Any shareholder interested in obtaining a physical copy of the same may write to the Company Secretary at the Registered Office of the Company

AUDIT

M/s Deloitte Haskins & Sells (DHS), Registration No. 117366W, who are the Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting. It is proposed to re-appoint them to examine and audit the accounts of the Company for the FY 2013-14. DHS have, under Section 224(1) of the Act, furnished a certificate of their eligibility for re-appointment.

Cost Audit

As per the requirement of the Central Government and pursuant to Section 233B of the Act, the audit of the cost accounts relating to motor vehicles is carried out every year. Pursuant to the approval of Ministry of Corporate Affairs, M/s Mani and Company having registration No. 00004 were appointed as the Cost Auditors for auditing the Companys cost accounts relating to the Companys products for FY 2012-13. An application has been made to the Central Government seeking their approval, for the appointment of M/s Mani and Company for auditing the Companys cost accounts relating to the Companys products for FY 2013-14.

The cost audit report and compliance report for FY 2011 -12 were filed by the Company on December 28, 2012, well within the prescribed due date of February 28, 2013. The cost audit report and compliance report for FY 2012-13 is expected to be filed within the prescribed time.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 217 (2AA) of the Act, the Directors, based on the representation received from the Operating Management, confirm that:-

- in the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;

- they have, in the selection of the accounting policies, consulted the Statutory Auditors and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

- they have taken proper and sufficient care, to the best of their knowledge and ability, 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;

- they have prepared the annual accounts on a going concern basis.

ACKNOWLEDGEMENTS

The Directors wish to convey their appreciation to all of the Companys employees for their enormous personal efforts as well as their collective contribution to the Companys performance. The Directors would also like to thank the employee unions, shareholders, fixed deposit holders, customers, dealers, suppliers, bankers, Government and all the other business associates for the continuous support given by them to the Company and their confidence in its management.

On behalf of the Board of Directors

CYRUS P MISTRY

Chairman

Mumbai, May 29, 2013


Mar 31, 2012

TO THE MEMBERS OF TATA MOTORS LIMITED

The Directors present their Sixty-Seventh Annual Report and the Audited Statement of Accounts for the year ended March 31, 2012.

FINANCIAL PERFORMANCE SUMMARY

(Rs. in crores) Company Tata Motors Group (Standalone) (Consolidated) FY 2011-12 FY 2010 -11 FY 2011-12 FY 2010-11

FINANCIAL RESULTS

Gross revenue 59,220.94 51,183.95 170,677.58 126,414.24

Net revenue (excluding excise duty) 54,306.56 47,088.44 165,654.49 122,127.92

Total expenditure 49,894.76 42,282.07 141,954.02 104,312.89

Operating profit 4,411.80 4,806.37 23,700.47 17,815.03

Other income 574.08 422.97 661.77 429.46

Profit before interest, depreciation, amortization, Exceptional item and tax 4,985.88 5,229.34 24,362.24 18,244.49

Finance cost 1,218.62 1,383.70 2,982.22 2,385.27

Cash profit 3,767.26 3,845.64 21,380.02 15,859.22

Depreciation, amortization and product

Development / engineering expenses 1,840.99 1,502.00 7,014.61 5,653.06

Profit for the year before exceptional items & tax 1,926.27 2,343.64 14,365.41 10,206.16

Exceptional items - loss/(gain) 585.24 147.12 831.54 (231.01)

Profit before tax 1,341.03 2,196.52 13,533.87 10,437.17

Tax expense/(credit) 98.80 384.70 (40.04) 1,216.38

Profit after tax 1,242.23 1,811.82 13,573.91 9,220.79

Share of minority interest and share of profit of associates(net) - - 57.41 (52.83)

Profit for the year 1,242.23 1,811.82 13,516.50 9,273.62

APPROPRIATIONS

Profit for the year 1,242.23 1,811.82 13,516.50 9,273.62

Balance brought forward from previous year – profit/(loss) 2,078.92 1,934.13 6,461.49 (1,017.85)

Amount available for appropriations 3,321.15 3,745.95 19,977.99 8,255.77

Less: appropriations

Debenture Redemption Reserve 70.00 - 70.00 -

General Reserve 125.00 200.00 158.03 228.78

Other Reserves - - 65.38 84.20

Dividend (including dividend distribution tax) 1,462.24 1,467.03 1,488.62 1,481.30

Balance carried to Balance Sheet 1,663.91 2,078.92 18,195.96 6,461.49

DIVIDEND

Considering the Company's financial performance, the Directors recommended a dividend of Rs.4/- per share (200%) on the capital of 2,70,77,31,241 Ordinary Shares of Rs.2/- each (previous year: Rs.20/- per share (200%) on share of face value of Rs.10/- each) and Rs.4.10 per share (205%) on 48,19,59,190 'A' Ordinary Shares of Rs.2/- each (previous year: Rs.20.50 per share (205%) on share of face value of Rs.10/- each) fully paid-up for FY 2011-12 and will be paid on or after August 14, 2012. The said dividend, if approved by the Members, would involve a cash outflow of Rs.1,464 crores (previous year: Rs.1,466 crores) including dividend distribution tax resulting in a payout of 118% (previous year: 81%) of the standalone profits for the year and 11% (previous year: 16%) of the consolidated profits of the Company.

SUB-DIVISION OF SHARES

As a step towards better liquidity and increased investor participation, the Company undertook a sub-division of face value of its Ordinary Shares and 'A' Ordinary Shares (collectively "the Shares") from Rs.10/- to Rs.2/- per share with effect from the Record Date i.e. September 13, 2011. New ISINs - INE155A01022 for Ordinary Shares and IN9155A01020 for 'A' Ordinary Shares have been obtained from the Depository. Consequently, the sub-divided Shares were credited to the respective depository accounts of Members holding shares in electronic form and new share certificates were issued to Members holding Shares in physical form.

OPERATING RESULTS AND PROFITS

Global markets had a mixed year with the US showing recovery, European countries continue to face a crisis, while Asia, China in particular, continued on a healthy growth trajectory.

After a strong performance in FY 2010-11, the Indian economy showed signs of slowdown in FY 2011-12, due to inflationary pressures. Measures taken to arrest inflation adversely impacted growth which dropped to 6.9% from 8.6% in the previous financial year. The year also witnessed a sharp deceleration in manufacturing activity mainly due to monetary tightening, weak external demand and lack of investment activity. The Indian automotive industry continued to grow, albeit at a reduced rate of 7.2%. The Tata Motors Group took cognizance of the global development and planned market actions accordingly. The Tata Motors Group recorded a 35.0% overall growth in gross turnover from Rs.1,26,414 crores in FY 2010-11 to Rs.170,678 crores in FY 2011-12. This is the highest turnover recorded by the Group. The consolidated revenues (net of excise) for FY 2011-12, of Rs.165,654 crores grew by of 35.6% over last year on the back of strong growth in volumes across products and markets. The consolidated EBITDA margins for FY 2011-12 stood at 14.3%. Consequently, Profit Before Tax and Profit After Tax were Rs.13,534 crores and Rs.13,517 crores, respectively. During the year Jaguar Land Rover accounted for credit of GB£ 225million (Rs.1,794 crores) in respect of carried forward past losses in view of certainity of utilising the losses against future profits.

Tata Motors recorded a gross turnover of Rs.59,221 crores, a growth of 15.7%, from Rs.51,184 crores in the previous year. Cost reduction and value engineering continue to be areas of focus to improve operational efficiency. However, the increase in commodity prices globally put pressure on margins. Additionally, the need to increase marketing expenses to protect and grow market share have resulted in EBITDA margins reducing from 10.2% to 8.1%. During the year, there was an impact of Rs.585 crores of exceptional items on account of exchange loss (net) including on revaluation of foreign currency borrowings, deposits and loans arising from the depreciation of Indian Rupee and provision for impairment made for certain investments. The Profit Before Tax and Profit After Tax for the fiscal were lower at Rs.1,341 crores and Rs.1,242 crores, as compared to Rs.2,197 crores and Rs.1,812 crores in the previous year, respectively.

Jaguar Land Rover continued its growth in expanding markets, including a 76% year-on-year increase in China retail sales. The strengthening of business in China is expected to make it the largest market for Jaguar Land Rover within the next 12 months. Jaguar Land Rover also improved performance in more mature economies, where, despite uncertain trading conditions, it increased sales in all major markets.

Jaguar Land Rover recorded a turnover of Rs.1,03,635 crores, a growth of 47.4% from Rs.70,304 crores in the previous year. Volume growth was driven not only by new vehicle launches in the year, but also by increasing sales of existing models. Profitability growth was also benefitted from favourable exchange rates. The positive impact of the strengthening US$ against the GB£ and the Euro, improved revenues given a largely GB£ and Euro cost base. Further, cost efficiency improvements in material costs and manufacturing costs supported improvement in operational performance. These resulted in a higher EBITDA and Profit Before Tax of Rs.17,035 crores and Rs.11,820 crores respectively, as compared to Rs.11,478 crores and Rs.7,665 crores, respectively in the previous year. The EBITDA margin for FY 2011-12 is 16.3%. After recognition of previously unrecognised tax losses of Rs.1,794 crores the Profit After Tax was higher at Rs.12,279 crores, as compared to Rs.7,073 crores in the previous year.

Tata Motors Finance Limited, the Company's captive financing subsidiary, registered net revenues of Rs.2,018 crores and

reported a Profit After Tax of" 240 crores in FY 2011-12. Tata Motors Finance Limited announced their maiden dividend of 5% per equity share for FY 2011-12.

VEHICLE SALES AND MARKET SHARES

The Tata Motors Group sales stood at 12,69,483 vehicles, higher by 17.7% over the previous year. Global sales of all commercia vehicles were at 5,99,913 units, while global sales of all passenger vehicles were at 6,69,507 units.

Tata Motors

The Company recorded sales of 8,63,248 vehicles, a growth of 10.9% over the previous year, in the Indian domestic market. With the industry growing at a moderate 7.2%, the improved sales resulted in an increase in the Company's market share from 24.3% to 25.2%, in the Indian industry. The Company exported 63,105 vehicles from India, against 58,089 vehicles exported last year.

Commercial Vehicles

Within the domestic market, the Company continued to strengthen its presence in commercial vehicles, with sales of 5,30,204 units, growing 15.7% from the previous year - an all- time high for the Company. This represented a market leadership share of 59.4% in the domestic CV market.

Some of the highlights for the year were:

Sales in the LCV segment continued to drive performance, growing by a healthy 23.5% during the year to 323,118 units. The ramp up of micro-trucks - Ace Zip and Magic Iris continued, contributing to the growth in this segment alongwith the traditional Ace and Magic family. The Dharwad plant for the manufacture of the Zip and Iris was commissioned as scheduled and started operations from February 2012. However, as competition intensified, the market share dipped to 59.4% from 62.1% last year. The new generation Tata Ultra range of trucks was displayed at the Auto Expo and is expected to further drive growth in this segment.

Sales in the M&HCVs segment grew moderately at 5.3%. Volumes at 2,07,086 units reflected a market share of 59.4%. This segment also saw the entry of new players, which put pressure on the market share. However, sales of the Tata Prima, the next generation truck continued to grow. An increased focus on network development and customer initiatives, laid the foundation for future growth in M&HCVs.

Passenger Vehicles

In a year where the domestic car industry grew only by 3.6%, the Company's sales of passenger vehicles in the domestic market (inclusive of Tata, Fiat and Jaguar Land Rover brands) was at its highest ever at 333,044 units, representing a growth of 4.0% over the sales of previous year. In an intensely competitive passenger vehicles market, a market share at 13.1% was same as last year.

Some of the highlights of this year's performance were:

Sales of the Tata Nano increased to 74,521 units, a growth of 5.8% over last year. The Nano 2012 was launched in November 2011 in 10 new colours, resulting in an increased demand. Measures were undertaken to increase market penetration by establishing low-investment dealerships in interior towns.

Sales in the Compact segment (comprising Indica V2, Indica Vista, Indigo CS, Fiat Palio and Punto) grew by 10.5% to 1,76,104 units. The Indica Vista refresh, the Indica eV2 and the Indigo eCS were launched during the year, boosting sales in this segment and improving market share to 20.6% from 19.1% last year.

Sales in the Mid Size segment (comprising Indigo and Indigo Manza) were at 19,645 units. A slew of new entrants in this segment affected market share, which declined to 9.6% from 21.9%.

In the Utility Vehicles (UV) segment, comprising Sumo, Safari,

Aria and Land Rover, the Company sold 49,035 units, which translated to a growth of 16.8% and a market share of 13.3%. Sumo Gold, a new and improved variant of the Sumo was launched in November 2011, boosting UV sales.

In the Vans segment, market share increased to 5.2% from 0.8% as the Venture sales continued to grow.

Fiat Sales were at 17,129 units representing a market share of 0.67%.

The Company sold 2,274 units of Jaguar Land Rover brands during the year. Network for these brands continued to grow with 13 dealerships across 11 cities in the Country by the year end. The assembly plant for the Freelander in Pune assembled more than 800 units since the start of operations during the year.

Exports

Focused efforts in select ASEAN and Africa markets helped international exports from India grow by 8.6% to 63,105 units in the fiscal year. The Company exported 55,079 commercia vehicles and 8,026 passenger vehicles, a growth of 9.6% and 2.3% respectively over last year. A CKD plant was setup in South Africa for the assembly of commercial vehicles. Another plant is being setup in Indonesia and is expected to start operations next year. The Company continues to have a special focus on expanding its global footprint and is targeting product actions specifically to cater to international geographies.

Jaguar Land Rover

Jaguar Land Rover sold 314,433 vehicles in FY 2011-12, an increase of 29.1% on the prior reporting period. At the brand level, wholesale volumes were 54,039 units for Jaguar and 260,394 units for Land Rover, growing 2.0% and 36.6%, over the previous year, respectively.

Retail volumes in key growth markets saw significant increases with China and the Asia Pacific region.

Some of the highlights of this year's performance were:

Launch of the Range Rover Evoque in September 2011 with a world-wide roll out in December 2011, recording

sale of over 60,000 units in the first six months. The Evoque received over a 100 awards including Top Gear Car of the Year, World Design Car of the Year and North American Truck of the Year.

Expanded the Jaguar XF range with a more fuel efficient, 2.2 D XF with an 8 speed automatic gear box.

The introduction of new variants of the Jaguar XF as well as the continued strength of Ranger Rover and Range Rover Sport were key contributors to the overall success.

Entered into a JV with Chery Automobiles, China to develop, manufacture and sell certain Jaguar and Land Rover vehicles and jointly branded vehicles for the Chinese market.

Announced a GB£ 355 million investment in new state-of- the-art facility at Wolverhampton, UK, to manufacture new advanced low-emission engines.

Tata Daewoo Commercial Vehicles Company Limited

Sales of Tata Daewoo Commercial Vehicle (TDCV) at 9,531 units were higher by 9% from last year. Tata Daewoo Sales Company which was established in FY 2010-11, to distribute TDCV products, has stabilized its operation during the year enabling TDCV to focus on key accounts and fleet customers.

Tata Hispano Motors Carrocera

Tata Hispano Motors Carrocera, S.A. (Tata Hispano) was deeply affected by the economic downturn in Europe, particularly in Spain. Sales for the year were at 368 units, down by 27% from last year. Tata Hispano's bid for and delivered a prestigious CNG series hybrid low floor bus order for EMT Madrid during the year, demonstrating its technological capability. The Company made a provision for investments in Tata Hispano, arising from continuous undeperformance impacted by challenging market conditions.

Tata Motors (Thailand) Limited

Tata Motors (Thailand) Limited (TMTL) was affected by floods in

Thailand during the year, which negatively impacted supply chain partners and the overall demand scenario in Thailand. As a result, volumes of TMTL at 4,978 units in FY 2011-12, were down by 17.5% from last year. TMTL launched TDCV CNG tractors and Super Ace to boost volumes. The Nano is also currently being tested for sale in Thailand and has a potential to boost volumes.

Tata Motors (SA) (Proprietary) Limited

Tata Motors (SA) (Proprietary) Limited launched the Prima range of trucks in South Africa alongwith the TDCV range of tractor trailers and the Indigo Manza at the Johannesburg Motor Show with a view to increase the product offerings in South Africa.

CUSTOMER FINANCING INITIATIVES

The vehicle financing activity under the brand "Tata Motors Finance" of Tata Motors Finance Limited - a wholly-owned subsidiary company, posted improved financial results through higher disbursements, focus on controlling costs, improving quality of fresh acquisitions and micro-management of collections. Tata Motors Finance financed 2,30,588 vehicles during the year as compared to 1,60,781 vehicles in the previous year. Total disbursements of Rs.10,505 crores grew by 32.8% compared to Rs.7,908 crores in the previous year. The disbursals for commercial vehicles were Rs.7,204 crores (1,20,032 units) in FY 2011-12 compared to Rs.6,041 crores (94,446 units) for FY 2010-11. For passenger cars, disbursals were Rs.3,301 crores (1,10,556 units) in FY 2011-12 compared to Rs.1,867 crores (66,335 units) in FY 2010-11. Market share in terms of the Tata vehicle unit sales in India financed by Tata Motors Finance Limited increased from 21% to 23% in commercial vehicles and from 22% to 35% in passenger cars. Tata Motors Finance Limited implemented a strategy to manage non-performing assets (NPA), improve collection efficiencies and enhance the "Risk Scored Pricing Model" approach. This strategy along with a thrust on customer relations through a branch based re- organised field structure, improved operations and profitability, creating a robust platform to enable future growth.

For other overseas operations, the Company does not have a capital financing company but has arrangements with local consumer finance provides in key markets. Jaguar Land Rover has arrangements in place with FGA Capital, a joint venture with Fiat Auto and Credit Agricole for UK and European consumer finance, Chase Auto Finance for North America and similar arrangements with local providers in a number of other key markets. Tata Motors (Thailand) Limited has financing arrangements with Thanachart Bank.

HUMAN RESOURCES

The Tata Motors Group employed 58,618 permanent employees (previous year - 52,244 employees) as of the year end, out of which 53,011 employees were engaged in automotive operations. Tata Motors Limited employed 29,217 permanent employees (previous year - 26,214 employees) as of the year end. This increase supported the higher production and sales across the Group. The Tata Motors Group has generally enjoyed cordial relations with its employees and workers.

All employees in India belonging to the operative grades are members of labor unions except at our Sanand and Dharwad plants. All the wage agreements have been renewed in a timely manner and are all valid and subsisting. Operatives and Unions support in implementation of reforms that impact quality, cost erosion and improvements in productivity across all locations is commendable.

Safety & Health - Performance and Initiatives

The Leadership in Tata Motors is fully committed to the ultimate goal of employee safety. All employees at Tata Motors facilities are progressing with the vision of "Excellence in Safety". Safety reports are reviewed at the highest level including Board meetings. Tata Motors is working with DuPont for the improvement in safety culture towards setting up world- class safety standards and processes and building capability to improve and sustain a world-class safety culture. There has been an overall 41% improvement in safety performance across units during the year. This improvement has been recorded through the reduction of LTI -FR (Lost Time Injury Frequency Rate) which stood at 0.44 in FY 2011-12 as against 0.74 in FY 2010-11. Improvement of safety at offices, warehouses, depots and dealership workshops through the development of safety norms has set expectations on safety, setting up of Safety Committees and carrying out structured safety audits. Safety initiatives such as the "i-drive Safe" campaign for improving road and driving safety involving training of 2,500 drivers in defensive driving were undertaken. A host of initiatives on health and wellness were implemented with deployment of Health Index metrics across all plants in India.

The Pantnagar plant conferred with the prestigious 'Sword of Honour' by the British Safety Council, UK, is a reflection of the high standards of Health and Safety, performance and demonstration of Safety Leadership, in all phases of operations of the plant. The Passenger Car Business took safety management to the next level by aligning with British Safety Council Health & Standards and by achieving a 5 Star rating in the Audit with a score of 97.19% and 94.93% for Pune and Sanand plant, respectively.

Jaguar Land Rover's health and safety management system is based on the UK Health and Safety Executive's guidance for Health and Safety Management - HSG65, which sets a framework for the various aspects of a successful health and safety management system. All Jaguar Land Rover sites in the UK are accredited with OHSAS18001 and underwent an annual surveillance visit by the external assessors during 2011, which verified its continued compliance to this standard. The overall performance of Jaguar Land Rover's has been good with reduction in Lost Time Case rate. Jaguar Land Rover's Occupational Health Department also achieved accreditation to the SEQOHS standard (Safe Effective Quality Occupational Health Standard) for its activities and management systems within the Occupational Health facilities. An increase in headcount has led to a requirement for increasing the Health and Safety training and Induction programmes; with focused events around skilled workers being recruited into functions such as plant maintenance. The business has continued and built upon its programme of proactive health promotion events for employees throughout the year, covering a range of topics. A Health and Safety Week coinciding with the European Week of Safety took place across all Jaguar Land rover sites, comprising a series of specific events for its workforce.

Tata Daewoo Commercial Vehicles Co. Ltd, Korea recorded an incident rate of 0.48% for FY 2011-12, at par with the total industry rate. The Safety Index for FY 2011-12 was posted at 2.40, an improvement from 2.87 for FY 2010-11. TDCV also took a series of steps to improve their work environment for which it was declared as "Toxic free TATA DAEWOO." Tata Motors (Thailand) Limited reported an improved safety performance. Safety risk assessment is being reviewed for robustness, and safety training is being enhanced. Tata Motors (SA) (Pte) Ltd completed a baseline risk assessment and training of all its employees. The surveillance system was enhanced for improving security. Tata Hispano Motors Carrocera SA implemented many ergonomic projects to improve working conditions, making it a healthy, safe and productive work-place. Work-place environment is regularly monitored for upkeep and tracking of progress.

FINANCE

During the year, the free cash flows for Tata Motors Group were Rs.4,601 crores, post spend on capex, design and development of Rs.13,783 crores. Tata Motors Group's borrowing as on March 31, 2012 stood at Rs.47,149 crores (previous year Rs.32,811 crores). Cash and bank balances stood at Rs.18,238 crores (previous year Rs.11,410 crores).

Post spend on capex, design and development of Rs.2,835 crores, the free cash flows were Rs.818 crores for standalone operations of the Company. The borrowings of the Company as on March 31, 2012 stood at Rs.15,881 crores (previous year Rs.15,915 crores). Cash and bank balances stood at Rs.1,841 crores (previous year Rs.2,429 crores).

During the year, the Company raised Syndicated Foreign currency term loans of USD 500 million in accordance with the guidelines on External Commercial Borrowings (ECB) issued by the Reserve Bank of India in two tranches with tenors between four to seven years towards financing its general capital expenditure and investments in its overseas subsidiaries.

Tata Motors issued rated, listed, unsecured, non-convertible debentures of Rs.500 crores with maturities of 5-7 years in May 2012, to optimize the loan maturity profile.

During the year, post spend on capex, design and development of GB£ 1,410million (Rs.10,765 crores), the free cash flows were GB£ 1,062 million (Rs.8,318 crores), for Jaguar Land Rover. The borrowings of the Jaguar Land Rover as on March 31, 2012 stood at GB£ 1,848 million (Rs.15,065 crores) (previous year GB£ 1,260 million (Rs.9,007 crores)). Cash and bank balances stood at GB £2,563 million (Rs.20,891 crores) (previous year GB£ 1,028 million (Rs.7,349 crores)) resulting in negative net debt position.

In May 2011, Jaguar Land Rover PLC issued GB£1,000 million equivalent Senior Notes (Notes). The Notes include, GB£500 million Senior Notes due 2018, at a coupon of 8.125% per annum, USD 410 million Senior Notes due 2018, at a coupon of 7.75% per annum and USD 410 million Senior Notes due 2021 at a coupon of 8.125% per annum. This facility gave Jaguar Land Rover an access to long tenor funding while also diversifying its sources of funding.

In March 2012, Jaguar Land Rover issued GB£500 million Senior Notes due 2020, at a coupon of 8.25% per annum, with a yield of 8.375% per annum. This was an opportunistic fund raising which enabled Jagaur Land Rover to reinforce its market acceptance and demonstrated the confidence of the investors, while continuing to support steps taken towards strengthening capital structure and enhancing the debt maturity profile.

During the year, Jaguar Land Rover established 3-5 year committed Revolving Credit Facility amounting to GB£710 million. These lines, which have been availed from 13 banks, can be drawn as per requirement and is a step to further strengthen the capital structure.

Tata Motors Finance Limited raised Rs.155 crores by an issue of

unsecured, non-convertible, subordinated perpetual debentures towards Tier 2 Capital to meet its growth strategy and improve its Capital Adequacy ratio.

With healthy profitability and cash flow generation, Tata Motors was able to further de-leverage its Balance sheet. The Consolidated Net Automotive Debt to Equity Ratio stood at 0.25:1 on March 31, 2012 compared to 0.56:1 on March 31, 2011.

Tata Motors Group has undertaken and will continue to implement suitable steps for raising long term resources to match fund requirements and to optimize its loan maturity profile.

The Company's rating for foreign currency borrowings stood at "BB-"/Stable by Standard and Poor and "Ba3"/Stable by Moodys. For borrowings in the local currency, the rating stood at "AA-" by Crisil and at "AA-" by ICRA. During FY 2011-12, CARE revised the rating upwards by 1 notch to "AA". Post March 2012, Crisil and ICRA have changed the outlook on the ratings from "Stable" to "Positive".

As on March 2012, Jagaur Land Rover's rating stood at "B "/ Positive by Standard & Poor, "B1"/Stable by Moodys and "BB-"/ Stable by Fitch. Post March 2012, Standard & Poor has upgraded the rating to "BB-" retaining the Positive Outlook.

As on March 2012, Tata Motors Finance rating stood at "AA-" by Crisil and "AA-" by ICRA. Post March 2012, Crisil and ICRA have changed the outlook on the ratings of Tata Motors Finance Limited from "Stable" to "Positive".

FIXED DEPOSITS

The Company has not accepted any public deposits during FY 2011-12. As on March 31, 2012, the Company had deposits aggregating Rs.2,061 crores from 1,64,022 investors. There were no overdues on account of principal or interest on public deposits other than the unclaimed deposits as at the year end.

INFORMATION TECHNOLOGY INITIATIVES

Information Technology supported business growth and competitiveness by delivering strategic programs and services as identified in the Tata Motors' IT Strategy

Its commitment to customers is reflected in investments in the benchmark CRM (Customer Relationship Management) solutions. This is being used by over 3,200 channel partners and 37,000 users to handle customer needs. Customer interactions are backed by the Tata Motor's Call Center which augments key business processes across pre-sales, sales and service areas. The Center handled 30 million calls in FY 2011-12, with a consistent under 0.5 Second response time. We focused on deploying portals for targeted customer segments like key customers, loyalty customers, spares retailers, mechanics, State Transport Undertakings (STUs) and defence. We are also taking CRM to international markets in a planned manner

Tata Motors is expanding the usage of information through analytics across the organization. eCommerce with our suppliers through SAP Supplier Relationship Management (SRM) Solutions continues to see greater usage. The Company strengthened the usage of IT in manufacturing, supply chain, quality and workforce management deployed benchmark ITIL (Information Technology Infrastructure Library) processes, to improve the effectiveness of its IT services. Major highlights of the year are:

Focused real life pilots in advanced analytics towards market specific strategies.

Deployment of CRM Solution for International Business Dealers.

Solutions and capabilities built to support Rural Business expansion.

Customer focused solutions like Tata Alert (emergency breakdown), AMC and Tata Assured (pre-owned vehicles) businesses, were supported by new IT capabilities.

Extension of Centralized ERP Solutions and integrated WAN to the Company's new plant in Dharwad and South Africa and Hispano, Spain.

Manufacturing Execution Systems capabilities deployed in Ace Plant in Pantnagar.

Support to Human Resources strategy with solution in Learning Management System, employee on boarding and performance management.

Upgrades of the Company's key technology platforms to newer versions.

Digital Product Development Systems Initiatives

Engineering Research Centre's product development processes continue to imbibe best of the breed tools and technology solutions, for enhancing product development capabilities, addressing quality and time. Digital product validation processes have been given focused thrust in addressing sheet meta material variability.

Upgrades of the Company's key CAD/CAM/CAE technology solution platforms to newer versions.

Digital Manufacturing Planning (DMP) capabilities used to implement out-of-the-system work instruction sheets in manufacturing lines for CVBU, Pune plant.

In-house Knowledge Based Engineering (KNEXT) applications spread enhanced by deploying 15 new applications in various product design functions.

Product Lifecycle Management (PLM) now manages all digital product design data and design processes.

MINT application, in-house developed system, in the area of 'demerits' tracking has been institutionalized.

State of the art hardware upgrades in product development function.

Jaguar Land Rover continues to operate its globally diverse and complicated legacy IT architectures with high levels of service and resilience with notably few outages affecting business operations.

Jaguar Land Rover's IT strategy includes modernisation and replacement of old unsupported technologies;

consolidation of diverse technology platforms and suppliers; integration of business processes through SAP ERP and creating business value through innovation IT solutions like mobility. Major highlights of the year are:

Deployment of SAP for Finance functions in UK.

Roll-out of common SAP for its overseas National Sales Companies.

Deployment of real time Warranty Cost and Vehicle Production Quality Analysis.

Virtualization technologies to support globa collaboration for product design and engineering.

Virtual Dealership using high definition rendering software and human interaction technologies to reach more potential customers.

Tata Daewoo Commercial Vehicles Company Limited embarked on CRM Solution deployment leveraging Tata Motors CRM. Tata Motors (SA) (Proprietory) Limited IT set-up became operationa including SAP while Tata Hispano Motors Carrocera (SA) started its SAP deployment. Tata Motors is integrating its WAN with subsidiaries for seamless operations.

Tata Motors Group companies continue their collaboration in various information technology areas with synergies being explored for cross utilization of IT capabilities. The group companies are working together in areas of ERP, outsourcing and technologies. Tata Technologies continues to be a strategic partner in strengthening Tata Motors Group's IT capabilities in process transformation through technology.

NEW PRODUCT, TECHNOLOGY AND ENVIRONMENT FRIENDLY INITIATIVES

Product Development

The Tata Motors Group continues to innovate and with a view to enhance the market share, aims at products catering to the changing needs of the customer for both fleet owners and individual customers. Some of the Company's key products launched during the year and other product development initiatives includes:

Showcased the Tata Mega Pixel - a four seater city-smart global range extended electric vehicle (REEV) concept at the Geneva Motor Show.

Unveiled the Tata Safari Storme-a 4WD SUV powered by the 2.2 L DICOR a engine at the Delhi Auto Expo held in January 2012.

Showcased at the New Delhi Auto Expo, the new Ultra range of Tata LCV trucks and buses powered by the new generation 3-litre and 5-litre engines, developed in-house. After the Prima for the M&HCV segment, the Ultra range represents the next quantum jump in the Indian LCV segment with world class cutting technology.

Launched the Nano 2012 - with improved mileage, better comfort and better driveability, with 10 new refreshing colours.

Launched the Indica Vista refresh with new and improved styling.

Launched the BS IV compliant Sumo Gold powered by the 4SP DICOR engine - with best-in-class power and drivability and improved mileage.

Showcased the Aria with improved interiors and a 6-speed automatic transmission (AT). An AT variant on the Prima 3138 tipper was also displayed.

Forayed into the super-luxury inter-city bus segment with launch of the Tata Divo. Also launched new variants in the Tata Starbus Ultra range. These products, in the mini- and mid-bus segments, will be available in the luxury, standard and deluxe variants.

Launched the Range Rover Evoque in September 2011 and has since garnered over 100 international awards. The class leading urban 4x4 comes in a range of trim levels and is the most customisable Range Rover ever produced.

The Jaguar XK range was significantly refreshed with a new look for 2011. The new XKR-S, which was unveiled at the Geneva Motor Show, is the fastest and the most powerful production sports GT that Jaguar has ever built. The Jaguar XF 12 model year line-up included a new four- cylinder 2.2-litre diesel version of the XF with Intelligent Stop-Start Technology, making it the most fuel-efficient Jaguar yet.

A 3.0-litre V6 petrol engine of the Jaguar XJ was launched in the Chinese market in early 2011, which has driven sales growth in the year. During the year, the XJ was upgraded to include a new Executive Package and a Rear Seat Comfort package, making Jaguar's flagship model, the ultimate executive limousine experience.

Showcased the Jaguar C-X16 concept car at the New York Auto Show. This will be the basis of the new F-type, a two-seater sports car due for launch in 2013.

The 2012 Model Year Range Rover, with an all-new 4.4-litre TDV8 engine, aiming to achieve a 14% reduction in CO2 emissions and a 19% improvement in fuel consumption to 7.81L/100km, was well received in the UK, Europe and overseas.

Development of Environment Friendly Technologies

The Indigo Manza hybrid, powered by a 1.05 litre DICOR engine and potent electric motors, has a focus on drivability and usable performance in the real world.

The Tata Nano CNG concept was displayed at the Auto Expo with world class safety strategies and an intelligently packaged CNG system so as not to disturb luggage space.

A CNG variant of the Magic Iris - a stylish, comfortable and environment friendly vehicle was displayed at the Auto Expo.

The Tata Starbus Fuel cell concept, a path breaking initiative in alternate fuel technology, was developed with the support from the Government of India's Department for Scientific and Industrial Research. In this concept, compressed hydrogen combines with oxygen to generate electricity, which is used to power the vehicles motor and emits only water vapour.

The all-aluminium Jaguar XJ 3.0 V6 twin-turbo diesel has

CO2 emissions rated at 184g/km

The Freelander 2 features a new eD4 diesel engine capable of 4.98L/100km and CO emissions of 158g/km in 2WD.

SUBSIDIARY AND ASSOCIATE COMPANIES

Tata Motors announces consolidated financial results on a quarterly basis. As required under the Listing Agreement with the Stock Exchanges, Consolidated Financial Statements of the Tata Motors Group are attached.

Pursuant to the provisions of Section 212(8) of the Companies Act, 1956 (Act), the Ministry of Corporate Affairs vide its Genera Circular No 2/2011 dated February 8, 2011, has granted a general exemption subject to certain conditions to holding companies from complying with the provisions of Section 212 of the Act, which requires the attaching of the Balance Sheet, Profit & Loss Account and other documents of its subsidiary companies to its Balance Sheet. Accordingly, the said documents are not being included in this Annual Report. The main financial summaries of the subsidiary companies are provided under the section 'Subsidiary Companies: Financial Highlights for FY 2011-12' in the Annual Report. The Company will make available the said annual accounts and related detailed information of the subsidiary companies upon the request by any member of the Company or its subsidiary companies. These accounts will also be kept open for inspection by any member at the Head Office of the Company and the subsidiary companies.

Subsidiary Companies

Tata Motors had 64 (direct and indirect) subsidiaries (9 in India and 55 abroad) as on March 31, 2012, as disclosed in the accounts. During the year, the following changes have taken place in subsidiary companies:

Subsidiary companies formed/acquired

Jaguar Land Rover (South Africa) Holdings Limited - a wholly-owned subsidiary of Jaguar Land Rover.

PT Tata Motors Indonesia - a wholly owned subsidiary of Tata Motors Limited.

Companies ceasing to be subsidiary companies

HV Transmissions Limited was amalgamated with TML Drivelines Limited (formerly known as HV Axles Limited).

Land Rover Parts US LLC was dissolved.

Land Rover Deutschland GmbH was merged into Jaguar Deutschland GmBH.

Jaguar Italia SpA was merged into Land Rover Italia.

Business of Land Rover Exports Ltd was transferred to Jaguar Land Rover Exports Ltd.

Name changes

HV Axles Limited to TML Drivelines Limited.

Jaguar Land Rover Limited to Jaguar Land Rover plc.

Jaguar Deutschland GmbH to Jaguar Land Rover Deutschland.

Land Rover Italia SpA to Jaguar Land Rover Italia SpA.

Jaguar Cars Exports Ltd to Jaguar Land Rover Exports Limited.

Other than the above there has been no material change in the nature of the business of the subsidiary companies.

Associate companies

As at March 31, 2012, Tata Motors had 9 associate companies and 2 Joint Ventures as disclosed in the accounts.

ENERGY, TECHNOLOGY & FOREIGN EXCHANGE

Details of energy conservation and research and development activities undertaken by the Tata Motors alongwith the information in accordance with the provisions of Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, are given as an Annexure to the Directors' Report.

DIRECTORS

Mr Cyrus P Mistry was appointed as an Additional Director on May 29, 2012 and Mr Ravindra Pisharody and Mr Satish Borwankar were appointed as Additional Directors on June 21, 2012. In accordance with Section 260 of the Companies Act, 1956 (the Act) and Article 132 of the Company's Articles of Association, they will cease to hold office at the forthcoming Annual General Meeting and are eligible for appointment. M/s Pisharody and Borwankar were also appointed as Executive Director (Commercial Vehicles) and Executive Director (Quality, Vendor Development & Strategic Sourcing) respectively of the Company for a period of 5 years with effect from June 21, 2012, subject to the approval of the Members. In accordance with the provisions of the Act and the Article of Association of the Company, M/s N Munjee, S Bhargava and V K Jairath are liable to retire by rotation and are eligible for re-appointment.

Attention of the Members is invited to the relevant items in the Notice of the Annual General Meeting and the Explanatory Statement thereto.

Mr Ratan N Tata was nominated by Tata Steel as 'the Steel Director' on August 11, 2011 pursuant to Article 127 of the Company's Articles of Association in place of Dr J J Irani who retired on June 2, 2011.

Mr Carl P Forster stepped down as the Managing Director and Group CEO on September 9, 2011, but continued to serve the Board as a Non-Executive Member till March 31, 2012.

Mr Prakash M Telang, Managing Director - India Operations, retired from the Company on June 21, 2012, on attaining the age of superannuation and stepped down from the Board of the Company. The Board of Directors expressed appreciation of the contributions made by Mr Telang over the years to the development and growth of the Company.

CORPORATE GOVERNANCE

A separate section on Corporate Governance forming part of

the Directors' Report and the certificate from the Practicing Company Secretary confirming compliance of Corporate Governance norms as stipulated in Clause 49 of the Listing Agreement with the Indian Stock Exchanges is included in the Annual Report. Tata Motors won "the Golden Peacock Award for Excellence in Corporate Governance" in 2011.

PARTICULARS OF EMPLOYEES

Tata Motors has 103 employees who were in receipt of remuneration of not less than Rs.60 lakhs during the year or Rs.5 lakhs per month during any part of the said year. The Information required under Section 217(2A) of the Companies Act, 1956 and the Rules made there under is provided in the Annexure forming part of the Report. In terms of Section 219(1)(b)(iv) of the Act, the Report and Accounts are being sent to the shareholders excluding the aforesaid Annexure. Any Shareholder interested in obtaining a copy of the same may write to the Company Secretary.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

A separate section on initiatives taken by the Tata Motors Group to fulfill its Corporate Social Responsibilities is included in the Annual Report.

AUDIT

M/s Deloitte Haskins & Sells (DHS), Registration No. 117366W, who are the Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting. It is proposed to re-appoint them to examine and audit the accounts of the Company for the Financial Year 2012-13. DHS have, under Section 224(1) of the Act, furnished a certificate of their eligibility for re-appointment.

Cost Audit

As per the requirement of the Central Government and pursuant to Section 233B of the Act, the audit of the cost accounts relating to motor vehicles is carried out every year. Pursuant to the approval of Ministry of Corporate Affairs, M/s Mani & Co. having registration No. 00004 were appointed as the Cost Auditors for auditing the Company's cost accounts relating to motor vehicles (including auto components), foundry and forge for the year ended March 31, 2012.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 217 (2AA) of the Act, the Directors, based on the representation received from the Operating Management, confirm that:- - in the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;

- they have, in the selection of the accounting policies, consulted the Statutory Auditors and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

- they have taken proper and sufficient care, to the best of their knowledge and ability, 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;

- they have prepared the annual accounts on a going concern basis.

ACKNOWLEDGEMENTS

The Directors wish to convey their appreciation to all of the Company's employees for their enormous personal efforts as well as their collective contribution to the Company's performance. The Directors would also like to thank the employee unions, shareholders, fixed deposit holders, customers, dealers, suppliers, bankers, Government and all the other business associates for the continuous support given by them to the Company and their confidence in its management.

On behalf of the Board of Directors

RATAN N TATA

Chairman

Mumbai, June 21, 2012


Mar 31, 2011

The Directors present their Sixty-Sixth Annual Report and the Audited Statement of Accounts for the year ended March 31, 2011.

FINANCIAL PERFORMANCE SUMMARY

(Rs. in crores)

Company Tata Motors Group (Standalone) (Consolidated)

2010-11 2009-10 2010-11 2009-10

A FINANCIAL RESULTS

(i) Gross Revenue 52,135.97 38,364.10 1,27,419.62 95,567.42

(ii) Net Revenue (excluding excise duty) 48,040.46 35,593.05 1,23,133.30 92,519.25

(iii) Total Expenditure 43,269.15 31,414.77 1,05,353.33 83,905.09

(iv) Operating Profit 4,771.31 4,178.28 17,779.97 8,614.16

(v) Other Income 183.26 1,853.45 89.61 1,793.12

(vi) Profit before Interest, Depreciation, Amortization, Exceptional item & 4,954.57 6,031.73 17,869.58 10,407.28 Ta x

(vii) Interest and Discounting Charges (net)1,143.99 1,103.84 2,045.42 2,239.71

(viii) Cash Profit 3,810.58 4,927.89 15,824.16 8,167.57

(ix) Depreciation, Amortization & Product Development Expenses 1,466.94 1,177.90 5,618.00 4,385.33

(x) Profit for the year before Exceptional items & Tax 2,343.64 3,749.99 10,206.16 3,782.24

(xi) Exceptional items - Loss/(Gain) 147.12 920.45 (231.01) 259.60

(xii) Profit Before Tax 2,196.52 2,829.54 10,437.17 3,522.64

(xiii) Tax Expense 384.70 589.46 1,216.38 1,005.75

(xiv) Profit After Tax 1,811.82 2,240.08 9,220.79 2,516.89

(xv) Share of Minority Interest and Share of Profit in respect of invest - - 52.83 54.17 ments in associate companies

(xvi) Profit for the year 1,811.82 2,240.08 9,273.62 2,571.06

(xvii) Balance Brought Forward from Previous Year – Profit/(Loss) 1,934.13 1,685.99 (1,017.85)(1,553.66)

(xviii) Amount Available for Appropriations 3,745.95 3,926.07 8,255.77 1,017.40

B APPROPRIATIONS

(a) Debenture Redemption Reserve - 500.00 - 500.00

(b) General Reserve 200.00 500.00 228.78 520.32

(c) Other Reserves - - 84.20 13.08

(d) Dividend (including tax) 1,467.03 991.94 1,481.30 1,001.85

(e) Balance carried to Balance Sheet 2,078.92 1,934.13 6,461.49 (1,017.85)

DIVIDEND

Considering the Companys financial performance, the Directors have recommended a dividend of Rs.20/- per share on the increased capital of 53,83,22,483 Ordinary Shares of Rs.10/- each (previous year: Rs.15/- per share) and Rs.20.50 per share on 9,63,86,471 A Ordinary Shares of Rs.10/- each (previous year: Rs.15.50 per share) fully paid-up and any further Ordinary Shares and/or A Ordinary Shares that may be allotted by the Company prior to July 21, 2011 (being the book closure date for the purpose of the said dividend entitlement) for 2010-11 and will be paid on or after August 16, 2011. The said dividend, if approved by the Members, would involve a cash outfl ow of Rs.1,467.03 crores (previous year: Rs.991.94 crores) resulting in a payout of 81% (previous year: 44%) of the standalone Profits of the Company.

OPERATING RESULTS AND PROFITS

After a good year 2009-10 during which economies across the world showed signs of recovery, the economic conditions globally continued to be strong and positive in 2010-11, resulting in a strong growth for the automotive sector. The Indian economy continued to do well, driven by a good performance from the agricultural and the industrial sector with a GDP growth of 8.6%. The automotive sector recorded a growth of over 26% in India on the back of a robust economy.

Supported by its strong distinct product offerings in both the commercial vehicle and passenger vehicle ranges, the Company recorded a turnover of Rs.52,136 crores, a growth of 35.9% over the previous year. While the Company maintained a strong focus on cost control and market pricing, the increase in raw -material cost and fixed marketing expenses resulted in a lower EBITDA margin of 9.9% as compared to 11.7% in the previous year. The Profit Before Tax and Profit After Tax for 2010-11 was Rs.2,197 crores and Rs.1,812 crores respectively, as compared to Rs.2,830 crores and Rs.2,240 crores in the previous year. It may be noted that the previous year Profit included a net positive impact of Rs.958 crores, mainly on account of Profit on certain divestments which was partly set off by a loss on redemption of preference shares in a subsidiary company.

Jaguar Land Rover results for 2010-11 showed a signifi cant improvement with increase, both in volumes and revenue, better product mix, favourable exchange rates and higher margins. The introduction of the new Jaguar XJ, growing momentum of the Range Rover and Range Rover Sport and, in particular, the strengthening of the Jaguar Land Rover business in China, where it opened a National Sales Company (NSC) in mid 2010, were the main drivers. In addition, Jaguar Land Rover continued to benefit from cost effi ciencies and effective cash management initiatives adopted in response to the challenging operating conditions in 2008 and 2009.

As the global markets recovered coupled with a strong focus on product and market initiatives, particularly at Jaguar and Land Rover, the Tata Motors Group turnover in 2010-11 grew by 33.1% to Rs.1,23,133 crores. Tata Motors Group recorded its highest ever Consolidated Profit Before Tax of Rs.10,437 crores (Rs.3,523 crores in 2009-10) and the Consolidated Profit for the Year of Rs.9,274 crores (Rs.2,571 crores in 2009-10).

VEHICLE SALES AND MARKET SHARES

The overall Tata Motors Group sales at 10,80,994 vehicles crossed the 1 million mark in 2010-11, higher by 24.2% compared to the previous year. Global sales of all commercial vehicles were at 5,12,731 units, while global sales of all passenger vehicles were at 5,68,263 units.

The Company recorded sale of 7,78,540 vehicles in 2010-11, a growth of 22.8% over the previous year in the Indian domestic market representing a 24.3% market share in the Indian industry. It exported 58,089 vehicles from India, a growth of 70.3% over the previous year.

The Company increased its commercial vehicle sales in the Indian market to an all time high of 4,58,828 vehicles in 2010-11, representing a market share of 61.8%. A strong product portfolio, improved reach and penetration in the market and focus on customer oriented initiatives including fi nance enablement, ensured a 22.7% growth in commercial vehicle sales. Some of the key highlights were:

- The Company crossed the 4 million cumulative vehicle sales mark for its commercial vehicles.

- Sale of M&HCVs grew by 26.7% to 1,96,651 vehicles representing a market share of 60.1%. The Company continued to focus on customer centric initiatives, improved the sales of the Prima, and launched product variants to strengthen its product offerings. The Company introduced its CNG Hybrid city bus range and showcased it at the Commonwealth Games in Delhi.

- Sale of LCVs grew by 19.9% to 2,62,177 vehicles representing a market share of 63.2%. The new products launched such as the Ace EX, Super Ace and 407 Pickup helped increase the sales. With competition entering the small commercial vehicles segment, the market share in the segment was lower as against last year.

The Companys sales of passenger vehicles in the Indian market (inclusive of Tata, Fiat and Jaguar Land Rover brands) were at its highest ever at 3,19,712 vehicles, representing a market share of 13.0% in 2010-11. The competition in the passenger car market continued to increase with more international Automobile manufacturers entering the market with a variety of product offerings. Some of the key highlights were:

- The Company crossed the 2 million cumulative vehicle sales mark for its passenger vehicles.

- In June 2010, the Sanand plant for the production of the Nano was inaugurated. The Company completed delivery on the bookings of the Nano and opened sales in various States in a phased manner. Nano sales increased to 70,431 vehicles, a growth of 129% from 30,763 vehicles in the previous year. The Company focused on increasing the reach and penetration for the Nano and also fi nancing enablement for potential customer segments. The Nano bagged the gold prize in the Best New Product segment under the transportation category at the 2010 Edison Award, symbolizing persistence and excellence personifi ed as also the worlds oldest and coveted international award for Good Design in 2010 conferred by the Chicago Athenaeum: Museum of Architecture and Design together with the European Centre for Architecture Art Design and Urban Studies in the category of transportation.

- The sales in the Small Car segment (comprising the Nano, the Indica and the Vista) increased to 1,80,091 vehicles, a growth of 13.9% representing a market share of 11.7%.

- The Indigo and the Indigo Manza sales were 87,919 vehicles. The Indigo eCS and the Indigo Manza Elan variants launched in the year were well received in the market and improved the Companys market share in the mid-size segment to 25.8% (after taking Jaguar).

- In the Multi Utility Vehicles (MUV) segment, the Company sold 42,741 (including Land Rovers) vehicles, a growth of 27.0% mainly boosted by sales of the Safari. The Aria - a premium crossover and the Venture - a multi-purpose vehicle in this segment launched during the year facilitated improvement in market share which stood at 13.2%.

- The Fiat sales were 20,342 vehicles representing a market share of 0.8% - with sales of the 8,536 Lineas and 11,806 Grande Puntos.

- The Company sold 889 vehicles from the Jaguar Land Rover range in India and widened its dealership network. It also began working on the local assembly for the Jaguar Land Rover range in Pune which has since been operational from May 2011.

- Assisted by a recovery from the economic crisis in its key markets and a renewed focus on exports, the Companys International Business grew by 70.3%. The Company exported 50,244 commercial vehicles, a growth of 80.2% and 7,845 passenger vehicles, a growth of 25.9% as compared to the previous year. The Company continues to keenly focus on international markets and expects to launch its new product range in many of these markets. An assembly plant in South Africa is being set up and is expected to start production next year.

Jaguar Land Rover sold 2,43,621 vehicles in 2010-11 registering a growth of 25.6% with sales of 52,993 Jaguars - a growth of 11.8% and 1,90,628 Land Rovers - a growth of 30.06% over the previous year. Jaguar Land Rovers major international markets (U.S., U.K., China and Germany) continued to do well and boosted sales of the Jaguar Land Rover range. The new Jaguar XJ, deliveries of which started in the year, contributed signifi cantly to the growth of the Jaguar brand. Jaguar Land Rover also displayed the Jaguar C-X75 at the Paris Motor Show and launched the all new XKR-S Jaguar at the Geneva Motor Show which received rave reviews. The Range Rover - Evoque displayed at various auto shows and planned for launch early next year, received rave accolades and is expected to translate the brand identity of Range Rover so as to include small and very relevant products without diminishing its brand value. Jaguar and Land Rover received more than 80 international awards for its vehicles during 2010, which were shared equally between the two iconic brands.

Jaguar Land Rover retail volumes in the U.K. totalled 58,134, a 1.9% increase over the previous year whilst the retail volumes in the North America totalled 50,280 with Jaguar and Land Rover volumes growing by 14.8% and 22.9% respectively over the previous year. Retail volumes in key growth markets grew signifi cantly with China at 28,893 and Russia at 11,689, higher by 69.9% and 32.4% respectively, over the previous year. There was moderate growth in Europe of 6.2% resulting in retail volumes of 53,711 and across all other markets of 38,198 representing a 15.7% growth over the previous year. Market Share of Jaguar Land Rover in U.K., U.S., Europe, Russia and China were also either maintained or marginally improved.

Tata Daewoo Commercial Vehicle (TDCV) sales were stagnant at 8,748 vehicles as compared to 8,769 vehicles in the previous year. The fi nancial instability of its sole distributor in its domestic market in the previous year brought new challenges and opportunities. TDCV started its own sales company to distribute its products in the Korean market and also launched the Euro V compliant range of products.

Tata Hispano Motors Carrocera, S.A. sold 505 vehicles as compared to 248 units in the previous year, increasing its market share to 13% from 8% in the previous year. It won a prestigious order for supplying around 500 buses in the next 3 years to the Avanza Group, one of the largest private passenger transportation groups in Spain.

Tata Motors Thailand (TMTL) continued to do well with sales of 6,031 vehicles against 2,536 vehicles in the previous year. The growth was driven by a good response to the Xenon CNG model. TMTL also launched the Super Ace in the Thailand market.

CUSTOMER FINANCING INITIATIVES

The vehicle fi nancing activity in India under the brand "Tata MotorFinance" (TMF) of Tata Motors Finance Limited - a wholly owned subsidiary company, has shown improvements in disbursements as well as net interest margins, driven mainly by the overall economic recovery coupled with a strong focus by TMF on controlling costs, improving quality of fresh acquisitions and micro-management of collections. TMF fi nanced 1,60,781 vehicles during the year as compared to 1,44,806 vehicles in the previous year. Total disbursements at Rs.7,908 crores grew by 18% as against Rs.6,697 crores in the previous year. The disbursals for commercial vehicles were Rs.6,041 crores (94,446 units) as compared to Rs.5,123 crores (96,593 units) and for passenger cars were Rs.1,867 crores (66,335 units) as compared to Rs.1,454 crores (48,213 units) in the previous year. The market share in terms of the Tata vehicles fi nanced by TMF declined from 26% in Commercial vehicles to 21% and increased from 21% to 22% in passenger cars. TMFs strategy on managing non-performing assets (NPA), improving collection effi ciencies, improvements in the "Risk Scored Pricing Model" approach and thrust on customer relations through a branch based re-organised fi eld structure, has in the last 2 years turned around and improved its operations and Profitability, setting a robust platform to enable future growth.

Jaguar Land Rover have entered into arrangements with financial service providers to make vehicle fi nancing available to customers in 12 countries worldwide covering the largest markets by volume, including Chase Auto Finance in the U.S. and FGA Capital (a joint venture between Fiat Auto and Credit Agricole) in the UK and the rest of Europe.

HUMAN RESOURCES

The overall employee relations were peaceful and harmonious throughout the year. The Company continued to create a productive, learning and caring environment by implementing robust and comprehensive HR processes. 2010-11 saw the Company attracting substantial talent to fi ll some key Senior Leadership positions. The permanent manpower headcount also increased by 7% to 26,214. This increase in headcount supported the production and sales of over 8 lakh vehicles. The productivity, in terms of the turnover per employee has gone up by 19.3% to Rs.96 lakhs / employee. The Commercial Vehicles Business Unit showed consistent improvement over the years and is better than its competitors on all of the 8 HR Management parameters as rated by A C Nielsen.

The long term wage settlements were signed between the management and its unions at locations where the settlements were due for negotiations. The bonus settlements at all our plant locations were signed/announced in the month of September/October. The Tata Motors Employees Union elections at Pune CVBU and PCBU were conducted peacefully on March 9, 2011, with new representatives being elected.

Jaguar Land Rover have generally enjoyed cordial relations with employees at their factories and offices and have not had any strikes in the last eight years. More than 96% of manufacturing shop floor workers and approximately 45% of salaried staff in the U.K. are members of a labour union. Jaguar Land Rover signed a landmark settlement deal with the Unions which would lead to the creation of new jobs in the next decade, including 1,500 jobs at its Halewood facility, Liverpool in 2011. Jaguar Land Rover is recognised as a preferred employer in the U.K. and has won recognition in The Times "Top 100 Graduate Employers" for 2011; has won entry into The Times "Top 50 Employers for Women" and "one to note" as a first time entry in The Times "Best Companies" survey.

SAFETY & HEALTH - PERFORMANCE AND INITIATIVES

All of the Companys operating plants in India have been certifi ed to OHSAS - 18001 and ISO - 14001 standards and all the CVBU units have been conferred with the Golden Peacock Award on Safety & Health. Jamshedpur plant was adjudged first and was awarded by CII (Confederation of Indian Industry) Eastern Region in Safety, Health & Environment Practices. The Company took steps towards ensuring that every single individual working within its plant premises is protected from any harmful impact of his/her working and the inherent risks. Towards this end, the Company recently completed a diagnostic of the existing safety systems through DuPont and is taking steps to raise the safety standards to world class levels. ZAP (Zero Accident Plan) meetings are held all across plants and the defi ned bay owners in these plants champion these meetings. Tata Marcopolo Motors Limited would be implementing IMS – 18001/14001/9001 in both their plants in 2011-12 and other initiatives to increase focus on safety, including conducting of periodical audits to measure and ensure safety. A host of initiatives on health and wellness were taken across all plants in India. Specifi cally, a Health Index was initiated in the Pune plant and Ergonomics study carried out to improve workplace environment.

In overseas locations:

Jaguar Land Rover has robust health and safety management systems based on the U.K. Health and Safety Executives HSG 65 Standard for Successful Health and Safety Management. Jaguar Land Rover are working to achieve the international health and safety certifi cation standard OHSAS 18001, on all sites, with the first stage of the certifi cation process completed during 2010. All Jaguar Land Rover employees receive health and safety training as part of their induction and are kept up-to-date by weekly health and safety briefi ngs, quarterly occupational health and safety information bulletin, specifi c safety brief in response to any signifi cant incidents that occur, health and safety information on dedicated safety notice boards at each site and campaigns to raise awareness of specifi c risks or safety processes. Jaguar Land Rover also participates in awareness campaigns led by the U. K. Health and Safety Executive and the European Agency for Safety and Health at Work.

TDCV Korea achieved an accident rate of 0.30% (lower than the national average as well as competitors) and is certifi ed to OHSAS-18001 & ISO – 14001 Standards. Tata Hispano, Spain achieved ISO - 14001 certifi cation. Tata Motors (Thailand) Ltd. (TMTL) had Zero accidents and also conducted specifi c training from equipment suppliers like wheel alignment, overhead cranes, two/four post lifters, etc. to ensure safe and proper operations by the workmen.

The above initiatives are in line with the Tata Motors Groups medium term goal to emerge as a leader in safety in the Indian automobile industry and globally in the longer horizon.

FINANCE

The borrowings of the Company as on March 31, 2011 stood at Rs.15,899 crores (previous year Rs.16,595 crores). Cash and Bank balances and Current investments in Liquid / Liquid Plus schemes of Mutual funds stood at Rs.2,514 crores (previous year Rs.2,273 crores).

Tata Motors Groups borrowings as on March 31, 2011 stood at Rs.32,791 crores (previous year Rs.35,108 crores). Cash and Bank balances and current investments in Liquid / Liquid Plus schemes of Mutual funds stood at Rs.12,071 crores (previous year Rs.9,808 crores). The key highlights were:- - The Company issued rated, listed, secured/unsecured non-convertible debentures of Rs.900 crores with maturities of 10 – 15 years as a step to raise long term resources and optimize the loan maturity profi le.

- In October 2010, the Company raised funds aggregating Rs.3,351 crores (US$ 750 million) by an issue of 3,21,65,000 A Ordinary Shares at a price of Rs.764/- per share and 83,20,300 Ordinary Shares at a price of Rs.1,074/- per share to Qualifi ed Institutional Buyers (QIBs), under a qualifi ed institutional placement. The said issue was well received by the investors and the Company availed of the opportunity to price it at the mid-upper band. This milestone in the fi nancing strategy enabled it to come closer to its objective of balance sheet de-leveraging.

- Consequent upon the holders of Foreign Currency Convertible Notes (FCCNs) of US$327.07 million and JPÂ¥ 30 million exercising their option to convert their FCCNs to Ordinary Shares, the Company allotted 2,35,70,426 Ordinary Shares.

The Company redeemed the 0% JPÂ¥ 720 million Convertible Notes as per the terms of the issue which were remaining outstanding out of the 0% JPÂ¥ 11,760 million Convertible Notes issued in 2006, the balance 93.9% of the said Notes being previously converted/ repurchased.

Tranche 1 of the secured, rated, credit enhanced, listed 2% coupon non convertible debentures aggregating Rs.800 crores was redeemed as per the terms of issue out of the 4 tranches of debentures aggregating Rs.4,200 crores issued in 2009-10.

With a turnaround in the business and continuing strong Profitability in 2010-11, the net debt at Jaguar Land Rover reduced to GB£ 233 million. During the year, Jaguar Land Rover took steps to establish hedging lines in order to reduce risks to the business from foreign exchange fl uctuations and establishing long term funding facilities in order to strengthen the capital structure.

Tata Motors Finance Ltd have raised Rs.361 crores by an issue of unsecured, non-convertible, subordinated perpetual debentures towards Tier 1 and 2 Capital to meet its growth strategy and improve its Capital Adequacy ratio.

Tata Motors Groups gross Debt/Equity ratio as at March 31, 2011 at 1.17 was signifi cantly lower as compared to 4.28 as on March 31, 2010.

The Company has undertaken and will continue to implement suitable steps for raising long term resources to match the Companys fund requirement and to optimize its loan maturity profi le. The Companys rating for foreign currency borrowings was revised upwards by Standard & Poor by 2 notches to BB- and by Moodys by 3 notches to Ba3. For borrowings in local currency, the rating was revised upwards by 1 notch by Crisil at AA-, by ICRA at LAA- and reaffi rmed by CARE at AA-.

INFORMATION TECHNOLOGY INITIATIVES

Tata Motors Group continues to lead in the use of Information Technology as an integral part of its strategy and goes beyond the organisations boundaries to cover suppliers, dealers and customers. The Company won an Architecture Excellence Award in the IT Service Management category at the ICMG World Conclave. The Companys competitive advantage includes a world class Customer Relations Management solutions (CRM) with integrated Dealer Management System (DMS) used by more than 2,500 channel partners. For receiving customer requests and feedback, the Company has an enterprise SMS no. 5616161 and a customer toll free no. 1800 209 7979. CRM capabilities are now being replicated in its international operations. Major highlights of the year are:-

- Enhancement of the Call Center operations capabilities to get benchmark customer interaction performance, addition of Key Accounts Portal and deployment of Used Vehicle and Customer Loyalty solution.

- Strengthening of IT support through distributed warehouse management and spares planning systems for its after market operations.

- Implementation of ERP for large and complex maintenance operations for the Delhi Transport Corporation.

- Supplier self service with design collaboration solution extended to additional 550 vendors with more than 2,500 vendors.

- Use of manufacturing automation systems to run lean production operations with advanced systems in plants for Nano and Ace.

- Expanded analytics and planning solutions to all key business functions with plans to embrace advanced analytical capabilities.

- Jaguar Land Rover completed IT transition from Ford and launched multiple strategic ERP programs.

- Jaguar Land Rover has commenced IT enhancements with the implementation of SAP ERP software in the UK and SAP "all in one" in the National Sales Companies. Jaguar Land Rover is also transforming its product development capabilities with new toolsets, including Product Life Cycle Management (PLM).

- TDCV, Korea started its own sales and marketing operations, which went through the ERP implementation to support retail sales and initiated centralized IT procurement to leverage common contracts and terms.

The Tata Motors Group companies are collaborating on various fronts in the use of Information Technology including deployment of state-of-the-art video conferencing system. The Tata Technologies Group continues to be a strategic partner in strengthening the Tata Motors Group IT capabilities.

NEW PRODUCT, TECHNOLOGY AND ENVIRONMENT FRIENDLY INITIATIVES Product Development

The Company strives to be at the forefront of innovation and works to launch products aimed at the emerging needs of its customers. It continues to develop and build on its in-house capabilities and works with the right partners to ensure that it has competitive product offerings. Some of the Companys key products and initiatives for the year include:

- Showcased the Tata Pixel - a concept for a future city car at the Geneva Motor Show.

- Launched the Aria - a premium crossover with high-end features such as 4x4, Torque on Demand, ESP, six airbags.

- Launched the BS IV compliant variants of the Indica and the Indigo CS, the Indica eV2 and Indigo eCS with segment leading fuel effi ciencies. These vehicles are powered by the Companys 1.4L CRAIL engine.

- Launched Elan - a high end variant of the Indigo Manza sedan.

- Ace Zip and Magic Iris were test marketed in various parts of the country and are expected to be formally launched across the country in May this year. This completes the Ace family offerings now spanning from the Ace Zip and Magic Iris at the lower end and the Super Ace and Venture on the higher end.

- Launched the Venture - a Multi Purpose Vehicle (MPV) on the Ace platform.

- The Prima range launched in the previous year was expanded with the introduction of the Prima Construck range of tippers in the market. Some Prima trucks were also launched in Korea and some of the tippers are soon expected to be launched in the international markets.

- Jaguar Land Rover launched the all new Jaguar XJ, the new 4.4 V8 diesel Range Rover and the new 2.2 diesel Land Rover - Freelander.

- Jaguars Advanced Design Team and the Jaguar Land Rover Technical Innovation Team created a concept car for the Paris Motor Show to celebrate 75 years of Jaguar Design and Innovation. The resultant - a stunning Jaguar C-X75, is a radical combination of hyper-car, eco-friendliness and 21st century technology, which won Car of the Show capturing the imagination of millions. Jaguar Land Rover recently announced their partnership with Williams F1 to bring a version of this concept to the market in 2013.

- Tata Hispano Motors Carrocera, S.A., Spain introduced 4 new brand models of its buses, viz. Area - an urban bus, 2 hybrid urban buses and Naya - a new deluxe coach. This alongwith the Xerus and Intea models launched last year would expand its product range in high-end buses/coaches.

Development of Environment Friendly Technologies

As a responsible automotive manufacturer, the Tata Motors Group continues to develop vehicles and technologies to reduce its carbon footprint. Some of the signifi cant initiatives/achievements are:

- Showcased its CNG parallel Hybrid low-floor city buses in the Commonwealth Games in Delhi.

- Tata Indica Vista EVX developed by engineers at our European subsidiary - Tata Motors European Technical Centre, Plc, bagged the Most Economic Small Passenger EV and the Most Economical and Environment Friendly Small Passenger EV under the Small Passenger EV category at the inaugural Royal Automobile Club, Brighton to London Future Car Challenge.

- Migrated to meeting the BS IV emission norms by developing BS IV compliant range of vehicles, in particular, Indica eV2 and Indigo eCS with 1.4L CRAIL engines with segment leading fuel effi ciencies.

- Jaguar and Land Rover continue to invest heavily in environmental innovation to support delivery of the 2012 European Union requirement for reduction in CO2. The 2010-11 new model launches including the all new Jaguar XJ, the new 4.4 V8 Diesel Range Rover and the new 2.2 Diesel Land Rover - Freelander realised improvements in CO2 performance in excess of 10 %. The Jaguar XF and Range Rover Evoque to be launched in the second quarter of 2011, would continue this trend. The Jaguar XF 2.2 Diesel 8 speed automatic transmission variant with Stop/Start technology reduces the entry model CO2 output whilst the Evoque features a number of lightweight, vehicle effi ciency and Powertrain technologies that make this the most fuel effi cient Range Rover ever.

Jaguar Land Rover is working on introducing a new Premium Lightweight Architecture for its products. This has seen a host of environment friendly technologies including new aluminium alloys, down-sized powertrains, Eco HMI, sustainable materials, best-

CO2 navigation routes, electronic power steering, aerodynamic features and many more technologies. These technologies enable the delivery of class leading Luxury and Performance combined with low CO2 and lay the foundation for effi cient hybridization of the platform. Jaguar Land Rovers initial Full-Hybrid programme is also in advanced stages.

In 2010-11, some of the Plug-In Hybrid projects of Jaguar Land Rover were completed and have provided the technical foundation for a production development programme for Parallel Plug-in Hybrids. In addition, Jaguar Land Rover has made signifi cant progress on a number of ongoing collaborative Research and Development programmes investigating a wide range of CO2 reduction technologies. These include radical combustion engine downsizing/pressure charging, alternative power sources for Series Hybrids, Flywheel KERS and waste energy recovery systems.

Tata Hispano Motors Carrocera SA, Spain, won a prestigious order for supplying 10 CNG Series Hybrid low-floor city buses, to be built on the Companys chassis, to EMT Madrid, a Madrid city public transportation company.

CONSOLIDATED FINANCIAL STATEMENTS

The Tata Motors Group reported consolidated revenues (net of excise) for 2010-11 of Rs.123,133 crores, posting a growth of 33.1% over Rs.92,519 crores in the previous year, with strong volume growth globally in all major markets. The Consolidated Profit before Tax (PBT) for the year was Rs.10,437 crores, compared to a PBT of Rs.3,523 crores for the previous year. The Consolidated Profit for the period (After Tax and post minority interest and Profit in respect of Associate companies) for the year was Rs.9,274 crores, a signifi cant increase from a Profit of Rs.2,571 crores in the previous year. As required under the Listing agreement with the Stock Exchanges, Consolidated Financial Statements of the Tata Motors Group (the Company and all its subsidiary companies) are attached.

Pursuant to the provisions of Section 212(8) of the Companies Act, 1956 (Act), the Ministry of Corporate Affairs vide its General Circular No 2/2011 dated February 8, 2011 has granted a general exemption subject to certain conditions to holding companies from complying with the provisions of Section 212 of the Act which requires the attaching of the Balance Sheet, Profit & Loss Account and other documents of its subsidiary companies to its Balance Sheet. Accordingly, the said documents are not being included in this Annual Report. The main fi nancial summaries of the subsidiary companies are provided under the section Subsidiary Companies: Financial Highlights 2010-11 in the Annual Report. The Company will make available the said annual accounts and related detailed information of the subsidiary companies upon request by any member of the Company or its subsidiary companies and the same will also be kept open for inspection by any member at the Head office of the Company and the subsidiary companies.

SUBSIDIARY AND ASSOCIATE COMPANIES

Subsidiary Companies

The Company has 67 (direct and indirect) subsidiaries (10 in India and 57 abroad) as on March 31, 2011 as disclosed in the accounts. During the year, the following changes have taken place in subsidiary companies:

Subsidiary companies formed/acquired, etc.

- The Company acquired 80% stake in Trilix Srl., Turin (Italy), a design and engineering company in September, 2010.

- Tata Precision Industries Pte. Ltd became a subsidiary after the Company increased its shareholding from 49.99% to 78.39% by subscribing to an additional 28.4% share of Tata Precision Industries Pte Ltd, Singapore on February 15, 2011. Tata Precision Industries Pte Ltd holds 100% shares of Tata Engineering Services Pte Ltd, hence Tata Engineering Services Pte Ltd also became a subsidiary.

- Tata Daewoo Commercial Vehicle Company Limited formed a wholly owned subsidiary, Tata Daewoo Commercial Vehicle Sales and Distribution Company Limited.

- HV Axles Limited and HV Transmissions Limited, two of the Companys subsidiaries, have announced an amalgamation to harness synergies and graduate to become a total driveline solutions provider.

Companies ceasing to be subsidiary companies

- INCAT SAS, a subsidiary of Tata Technologies Limited was liquidated.

- Jaguar Land Rover Mexico SA de CV was sold to an importer.

Name changes

Carroseries Hispano Maghreb to Tata Hispano Motors Carroseries Maghreb.

Other than the above there has been no material change in the nature of the business of the subsidiary companies.

Associate companies

As on March 31, 2011, the Company had 7 associate companies as disclosed in the accounts:

FIXED DEPOSITS

The Company discontinued the acceptance and renewal of fixed deposits from the public and shareholders with effect from May 28, 2010. During the year, it changed the Registrars to the Fixed Deposit scheme to M/s. TSR Darashaw Limited (TSRDL) from M/s. Link Intime India Private Limited. TSRDL are also the Registrars and Transfer Agents for shares and debentures issued by the Company since past few decades and would thus be a focal point of contact for all investor services. The Company has no overdue deposits other than unclaimed deposits.

ENERGY, TECHNOLOGY & FOREIGN EXCHANGE

Details of energy conservation and research and development activities undertaken by the Company along with the information in accordance with the provisions of Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, are given as an Annexure to the Directors Report.

DIRECTORS

Dr Ralf Speth was appointed as an Additional Director on November 10, 2010 in accordance with Section 260 of the Companies Act, 1956 (the Act) and Article 132 of the Companys Articles of Association and will cease to hold office at the forthcoming Annual General Meeting and is eligible for appointment. In accordance with the provisions of the Act and the Article of Association of the Company, M/s Ravi Kant, N N Wadia and S M Palia are liable to retire by rotation and are eligible for re-appointment. Attention of the Members is invited to the relevant items in the Notice of the Annual General Meeting and the Explanatory Statement thereto.

Dr J J Irani, a Director nominated by Tata Steel Limited (Steel Director) and who is a non-rotational Director as per Article 127 of the Companys Articles of Association, has conveyed his decision to step down from the Companys Board from June 2, 2011 on attaining 75 years as per the Retirement policy of the Tata Group. Dr Irani was also a member of the Companys Executive Committee of the Board. The Board of Directors in its meeting held on May 26, 2011 expressed appreciation of the enormous contributions made by Dr Irani over the years to the development and growth of the Company as also his good counsel in charting its future direction.

CORPORATE GOVERNANCE

A separate section on Corporate Governance forming part of the Directors Report and the certifi cate from the Practicing Company Secretary confi rming compliance of Corporate Governance norms as stipulated in Clause 49 of the Listing Agreement with the Indian Stock Exchanges is included in the Annual Report.

PARTICULARS OF EMPLOYEES

The Company has 99 employees who were in receipt of remuneration of not less than Rs.60 lakhs during the year or Rs.5 lakhs per month during any part of the said year. The Information required under Section 217(2A) of the Companies Act, 1956 and the Rules made thereunder is provided in the Annexure forming part of the Report. In terms of Section 219(1)(b)(iv) of the Act, the Report and Accounts are being sent to the shareholders excluding the aforesaid Annexure. Any Shareholder interested in obtaining a copy of the same may write to the Company Secretary.

CSR INITIATIVES

A separate section on initiatives taken by the Company to fulfi ll its Corporate Social Responsibilities is included in the Annual Report.

AUDIT

M/s Deloitte Haskins & Sells (DHS), Registration No. 117366W, who are the Statutory Auditors of the Company hold office until the conclusion of the ensuing Annual General Meeting. It is proposed to re-appoint them to examine and audit the accounts of the Company for the Financial Year 2011-12. DHS have, under Section 224(1) of the Act, furnished a certifi cate of their eligibility for re-appointment.

Cost Audit

As per the requirement of the Central Government and pursuant to Section 233B of the Act, the audit of the cost accounts relating to motor vehicles is carried out every year. Pursuant to the approval of Ministry of Corporate Affairs (MCA) vide Sr. No. 52/413/CAB/1989 dated September 1, 2009, M/s Mani & Co. having registration No. 00004 were appointed as the Cost Auditors for auditing the Companys cost accounts relating to motor vehicles for the financial year ended March 31, 2010. Consequent upon the audit undertaken and submission of the Cost Audit Report dated August 10, 2010 and based on the recommendation of the Audit Committee, the Board approved of the said Audit Report on August 10, 2010 which was fi led with the MCA on September 8, 2010.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 217 (2AA) of the Act, the Directors, based on the representation received from the Operating Management, confi rm that:- - in the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;

- they have, in the selection of the accounting policies, consulted the Statutory Auditors and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the Profit of the Company for that period;

- they have taken proper and suffi cient care, to the best of their knowledge and ability, 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;

- they have prepared the annual accounts on a going concern basis.

ACKNOWLEDGEMENTS

The Directors wish to convey their appreciation to all of the Companys employees for their enormous personal efforts as well as their collective contribution to the Companys performance. The Directors would also like to thank the employee unions, shareholders, fixed deposit holders, customers, dealers, suppliers, bankers, Government and all the other business associates for the continuous support given by them to the Company and their confi dence in its management.

On behalf of the Board of Directors

RATAN N TATA

Chairman Mumbai, May 26, 2011


Mar 31, 2010

The Directors present their Sixty-Fifth Annual Report and the Audited Statement of Accounts for the year ended March 31, 2010.

FINANCIAL PERFORMANCE SUMMARY

(Rs. in crores)

Company Tata Motors’ Group

2009-10 2008-09 2009-10 2008-09

A FINANCIAL RESULTS

(i) Gross Revenue 38,364.10 28,568.21 95,567.42 74,093.31

(ii) Net Revenue (excluding excise duty) 35,593.05 25,629.73 92,519.25 70,880.95

(iii) Total Expenditure 31,414.77 23,877.29 83,905.09 68,684.45

(iv) Operating Profit 4,178.28 1,752.44 8,614.16 2,196.50

(v) Other Income 1,853.45 925.97 1,793.12 798.96

(vi) Profit before Interest, Depreciation, Amortization, Exceptional items & Tax 6,031.73 2,678.41 10,407.28 2,995.46

(vii) Interest and Discounting Charges (Net) 1,103.84 673.68 2,239.71 1,930.90

(viii) Cash Profit 4,927.89 2,004.73 8,167.57 1,064.56

(ix) Depreciation, Amortisation & Product Development Expenses 1177.90 925.71 4385.33 2854.52

(x) Profit / (Loss) for the year before Exceptional items & Tax 3,749.99 1,079.02 3,782.24 (1,789.96)

(xi) Exceptional items 920.45 65.26 259.60 339.29

(xii) Profit / (Loss) Before Tax 2,829.54 1,013.76 3,522.64 (2,129.25)

(xiii) Tax Expense 589.46 12.50 1,005.75 335.75

(xiv) Profit / (Loss) After Tax 2,240.08 1,001.26 2,516.89 (2,465.00) (xv) Share of Minority Interest and Share of Profit/(Loss) in respect of investments in associate companies - - 54.17 (40.25)

(xvi) Profit / (Loss) for the year 2,240.08 1,001.26 2,571.06 (2,505.25)

(xvii) Balance Brought Forward from Previous Year 1,685.99 1,383.07 (1,553.66) 1,764.12

(xviii) Credit taken for Dividend Distribution Tax for Previous Year - 15.29 - -

(xix) Amount Available for Appropriations 3,926.07 2,399.62 1,017.40 (741.13)

B APPROPRIATIONS

(a) Debenture Redemption Reserve 500.00 267.80 500.00 267.80

(b) General Reserve 500.00 100.13 520.32 138.20

(c) Other Reserves - - 13.08 41.95

(d) Dividend (including tax) 991.94 345.70 1,001.85 364.58

(e) Balance carried to Balance Sheet 1,934.13 1,685.99 (1,017.85) (1,553.66)

DIVIDEND

Considering the Company’s financial performance, the Directors have recommended a dividend of Rs.15/- per share on the increased capital of 506,381,356 Ordinary Shares of Rs.10/- each (previous year- Rs.6/- per share) and Rs.15.50 per share on 64,176,560 ‘A’ Ordinary Shares of Rs.10/- each (previous year- Rs 6.50 per share) and any further Ordinary Shares and/or ‘A’ Ordinary Shares that may be allotted by the Company prior to August 12, 2010 (being the book closure date for the purpose of the said dividend entitlement) for 2009-10. The said dividend, if approved by the Members, would involve a cash outflow of Rs.991.94 crores (previous year - Rs.345.70 crores) resulting in a payout of 44% of the unconsolidated profits of the Company.

OPERATING RESULTS AND PROFITS

After the economic downturn and difficult market conditions in the automotive sector globally in 2008-09, during the year, economies across the world (with a few exceptions) showed signs of recovery and growth. The Indian economy bounced back quickly and strongly growing at 7.2% in 2009-10. The automotive sector in India started the year steadily, gathered momentum in different segments in the second half of the year and ended the year with a record growth and performance.

The Company’s turnover, in this background and with a strong portfolio coupled with successful launch of new products and variants in commercial vehicles and passenger vehicles, was Rs.38,364 crores, a growth of 34.3% over the previous year. The volume growth coupled with other actions on pricing and cost reduction enabled the Company to achieve significant improvement in EBIDTA margin to 11.7% (6.8% in 2008-09). The Profit Before Tax of Rs.2,830 crores and Profit After Tax of Rs.2,240 crores also grew significantly over the previous year by 179.1% and 123.7% respectively.

The Tata Motors’ Group turnover was Rs.95,567 crores, a growth of 29% over previous year contributed mainly by market recovery, improved realization and successful launch of new products. Consolidated Profit Before Tax was Rs.3,523 crores (Loss of Rs.2,129 crores in 2008-09) and Consolidated Profit for the year was Rs.2,571 crores (Loss of Rs.2,505 crores in 2008-09).

The performance of the Company and its subsidiaries is elaborated in the Management Discussion and Analysis Report which forms a part of this Annual Report. A snapshot is given below.

VEHICLE SALES AND MARKET SHARES

The Company recorded a sale of 633,862 vehicles in 2009-10, a growth of 34% over previous year (472,885 vehicles) in the domestic market in India, representing a 25.5% share in the industry (improving from 24.4% share in the previous year).

Commercial vehicle sales were highest ever at 373,842 vehicles achieving a robust growth of 40.9% over previous year and a market share of 64.2% (a gain of 0.4%, over previous year). A strong product portfolio, successful launch of new products and variants, extensive efforts in marketing and finance enablement for customers and leadership in market research and penetration, contributed to the significant improvement in overall performance. Some of the key highlights were:- - In M&HCV, growth of 36.5% to 155,161 vehicles and a market share improvement to 63.3% (from 61.9% in the previous year); launch of the next generation of heavy trucks - Prima range; completion of delivery of 1,625 low entry buses to Delhi Transport Corporation and delivery of major portion of the orders of over 5,000 buses under JnNURM Scheme of Government of India for modernizing the public transport in India.

- The Light Commercial Vehicle (LCV) sales recorded a spectacular growth of 45.4% in FY 2009-10. While this was largely aided by the growth in the small commercial vehicles, the rest of the segment also grew handsomely. The competition in the small commercial vehicle range increased resulting in a 0.5% loss in the domestic market share reducing it to 64.8%. The Company’s sales increased by 44.2% to 218,681 LCVs. The Company launched new variants on the Ace platform, Ace EX, Super Ace and the 407 Pickup which are expected to help in gaining volumes.

Passenger vehicle sales were 260,020 vehicles, highest ever, achieving a growth of 25.3% over previous year and a market share of 13.7% (stable compared to 13.6% in the previous year). The Company continues to be amongst the top three players in the passenger vehicle market which has over 25 players. The growing sales of the new generation Indica Vista and successful launch and market response for the Indigo Manza mainly contributed to the growth. Some of the key highlights were:

- In the Small Car segment, increase in market share to 13.3% (as against 12.7%, in the previous year), with the growing sales of Indica Vista, sales of the Nano and the Fiat Punto;

- Commencement of sales of Nano in July 2009 and completing deliveries of 30,763 cars to the customers and commencement of trial production in the Sanand plant.

- The Indigo range sales of 54,551 units, a growth of 10.9% over the previous year and also the highest ever sales by the Company in this range, mainly due to the launch of the Indigo Manza in October 2009.

- Sale of 33,507 Multi-Utility Vehicles (MUVs), a decline of 14.7% against the last year and as a result the market share dropped to 12.4%. The Grande Mk II which was launched in December 2009 has been well accepted in the market and is expected to help in regaining market share in the UV segment.

- Sale of 24,884 Fiat cars which has given Fiat a 1.3% market share as against 0.5% in the previous year with Linea sales at 11,102 nos. (a segment share of 10.1%) and the Grande Punto sales at 13,281 (a segment share of 3.5%).

- The Company sold 225 Jaguar and Land Rover vehicles through its exclusive dealerships in India in the first year of the sales of the Jaguar Land Rover brands.

The Company’s international business remained affected by the economic downturn in many of the key markets. The Company’s commercial vehicle exports grew moderately by 4.7% to 27,878 vehicles and passenger vehicles exports declined by 9.9% to 6,231 vehicles. With improved economic outlook and market recovery and with the new product range, the Company expects significant improvement in its international business in the future.

Tata Motors’ Group sales were 880,396 vehicles across its entire range of products and markets. The key highlights were:

- The Company has sold 667,971 vehicles.

- Jaguar Land Rover achieved sale of 193,982 vehicles as compared to 167,348 vehicles in 2008-09 (in 10 months since Tata Motors acquisition of the business in June 2008). Jaguar Land Rover continued to enhance its product offerings through an all new XFR, powertrain offerings and 2010 model year vehicles. The new Jaguar XJ was unveiled in London in July 2009 and had its public debut at the Frankfurt Motor Show in September 2009.

- In South Korea, Tata Daewoo Commercial Vehicle Company Limited (TDCV) successfully launched the new premium truck platform – Prima; TDCV sales were stagnant at 9,011 vehicles in Korea and international markets as compared to 9,137 vehicles in the previous year.

- In Thailand, Tata Motors (Thailand) Limited saw a very good response to the CNG version of the Tata Pick-up vehicle – Xenon. TATA MOTORS FINANCE LIMITED- CUSTOMER FINANCING INITIATIVES

The vehicle financing activity under the brand “Tata MotorFinance” (TMF) of Tata Motors Finance Limited, a wholly-owned subsidiary company, financed a total of 1,44,806 vehicles during the year as compared to 1,00,611 vehicles in the previous year. Total disbursements were Rs.6,697 crores as against Rs.4,900 crores in the previous year. The disbursals for new commercial vehicles were Rs.5,123 crores (96,593 units) as compared to Rs.3,319 crores (59,467 units) during the previous year. For passenger cars, total disbursements were Rs.1,454 crores (48,213 units) as compared to Rs.1,288 crores (41,144 units) in the previous year. The market share in terms of products financed by the Company increased from 22.4% in commercial vehicles to 26% and remained constant at 21% in passenger cars. TMF has shown improvements in disbursements as well as Net Interest Margins, mainly driven by the overall economic recovery coupled with a strong focus on controlling costs, improving quality of fresh acquisitions, micro- management of collections. TMF’s strategy on controlling, managing and reversing non-performing assets (NPAs) and ‘Risk Scored Pricing Model’ thrust on customer relations and a branch based re-organised field structure has set a robust platform to enable future growth.

HUMAN RESOURCES & INDUSTRIAL RELATIONS

Industrial Relations were cordial at all locations. In a challenging environment and business conditions, the support from the workforce and unions was positive throughout. The key highlights in the human resources and industrial relations were:- - The Company’s plant at Uttarakhand was conferred with the prestigious Golden Peacock Award for Safety & Environment and the National Award for energy conservation by the Ministry of Power. The Pune plant received the Frost and Sullivan Green leader award for 2009 in the automotive sector. The Jamshedpur plant obtained a revised and updated certification under SA 8000 - a global social accountability standard for working conditions, certifying labour practices at the facilities including those of suppliers. Towards organizational health and safety, the plants at Jamshedpur, Pune, Uttarakhand and Lucknow are certified under OHSAS 18001. The communication on progress during 2009-10 was submitted to the United Nations Global Compact. The Company has also submitted GRI report for 2008-09 based on G3 Guidelines of sustainability reporting framework. The Company also undertook several initiatives, including on-line tools for performance improvement, employee development and training.

- At Jaguar Land Rover, the year under review was dominated by the economic downturn and the need to cut costs quickly, which resulted in large numbers of non-production shifts in the 3 UK plants (Castle Bromwich, Halewood and Solihull). Jaguar Land Rover worked closely with its Trade Unions and negotiated a Framework Agreement which secured £68 million of cost savings. It closed its Defined Benefit pension scheme to new workers with effect from April 24, 2010, by introducing a Defined Contribution scheme. All Jaguar Land Rover sites have been prepared to commence certification process for OHSAS 18001 external accreditation for Health and Safety standards, commencing July 2010.

The Company had 482 employees who were in receipt of remuneration of not less than Rs.24 lacs during the year or Rs. 2 lacs per month during any part of the said year. The Information required under Section 217(2A) of the Companies Act, 1956 and the Rules made thereunder is provided in the Annexure forming part of the Report. In terms of Section 219(1)(b)(iv) of the Act, the Report and Accounts are being sent to the shareholders excluding the aforesaid Annexure. Any Shareholder interested in obtaining a copy of the same may write to the Company Secretary.

FINANCE

The borrowings of the Company as on March 31, 2010 stood at Rs.16,625.91 crores (previous year Rs.13,165.56 crores). The key highlights were:- - In 2009-10, the Company raised Rs.4,200 crores from the issue of Secured, Rated, Credit Enhanced, Listed, 2% Coupon Non-Convertible Debentures (NCDs) with premium on redemption and Rs.200 crores from the issue of 9.95% Secured NCDs.

- In a challenging financial market environment, the Company successfully rolled over in May 2009, the bridge finance it had obtained for acquisition of the Jaguar Land Rover business for a period of 18 months, till December 2010. Subsequently, the Company was able to prepay this loan facility in October 2009 from certain divestments, improved cash generation from operations and also through fund raised, US$ 375 million from the issue of Global Depository Receipts and US$ 375 million from issue of Foreign Currency Convertible Notes.

- Further, the Company made a limited period enhanced conversion offer to the non-U.S. holders of the 0% JPY 11,760 million and 1% US$ 300 million Convertible Notes. The offer met with great success with bondholders representing 93% of the JPY bonds and 76% of US$ series bonds, opting to convert their bonds into Ordinary Shares, which resulted in debt of US$ 345 million being extinguished against the issue of 26.64 million Ordinary Shares.

- The Company also sold 20% stake in Telco Construction Equipment Company Limited (Telcon), in favour of Hitachi Construction Machinery Co. Ltd. (Hitachi) for a consideration of Rs.1,152.51 crores (net of expenses) resulting in the Company’s shareholding being reduced to 40% (on consolidated basis).

Jaguar Land Rover completed guarantee arrangements to facilitate the drawdown of a £338 million loan from European Investment Bank for its projects aimed at emission reduction, besides other financing activities like an inventory financing facility; renewal of a US$200 million loan; and repaid short term borrowing totaling £220 million.

Tata Motors’ Group debt:equity ratio in the operations continues to remain high at 4.3:1, though significantly bought down from 5.9:1 as at March 31, 2009. The Board is conscious of this, and the need to strengthen the long-term funding for the business.

The Company will further consider suitable steps to de-leverage and hence de-risk the balance sheet from volatility and has also taken and will continue to implement suitable steps for raising long term resources to match the Company’s fund requirement and to optimize its loan maturity profile. The Company’s rating for foreign currency borrowings was revised by Standard & Poor to B (Positive Outlook) and by Moodys’ to B3 (Stable Outlook). For borrowing in local currency the rating was revised to A+ (Stable Outlook) by Crisil and to LA+ (Stable Outlook) by ICRA.

INFORMATION TECHNOLOGY INITIATIVES

Tata Motors Group continued to reinforce its IT capabilities in all areas of business in design/ engineering, manufacturing, vendor interface and dealer/customer interface functions. The major initiatives undertaken were:- - in Product Development/Engineering, 3D design visualization capability, enriching digital content by adding behaviour to digital models, Knowledge Based Engineering tools and enhanced digital collaboration with vendors;

- Digital manufacturing solutions and validation was extensively deployed for the Nano facilities planning; manufacturing Execution systems implemented in the high-volume plants at Uttarakhand and Sanand;

- Supplier portal, which facilitates close collaboration from design/development stage to production planning and scheduling;

- CRM-DMS program enhancements, which further enrich the on-line common platform system for the Company’s sales, spare parts service activities and for all channel partners, giving the Company an on-line real-time market and customer interaction and information capability;

- Extension of customer touch points through web, call centre and SMS.

- Jaguar Land Rover completed the process of separating its operations in markets where it previously operated as a part of the Ford legal entity and the process to separate the IT infrastructure and support systems is expected to be completed shortly. Jaguar Land Rover also rolled out its new SAP solution to many of its existing National Sales Companies around the world including South Africa, Brazil, North America, France and China. Jaguar Land Rover has initiated a major programme to re-engineer Product Creation capability, covering every aspect of Product Lifecycle Management (PLM) from concept to recycling, delivering a system that will provide everyone with immediate access to all Product Creation information, with simple-to-use, graphically-orientated user interfaces.

Tata Technologies Limited continues to be a key strategic partner in several of these technology initiatives.

NEW PRODUCT, TECHNOLOGY AND ENVIRONMENT - FRIENDLY INITIATIVES

Product Development

Tata Motors Group continuously assesses customer needs to develop new and innovative products which deliver better value to its customers. In pursuance of this strategy, the Company has developed significant in-house capabilities and works with a range of partners to keep its product profile rich and meet market expectations. Some of the key initiatives and projects include :- - The new heavy truck range Prima unveiled in May 2009, will be enriched through several product and application variants such as tractor trailers, tippers, rigid trucks over the next few years. TDCV received the Grand Prize of 2009 Good Design

Selection of Korea for the Prima, and development on a range of light trucks is underway.

- The new range of buses (based on the Prima platform with bodies being made by Tata Marcopolo displayed at the Delhi Auto Expo in January 2010) have been launched. Tata Hispano has developed a new Intercity Coach the Xerus and a new Suburban Bus, the Intea and is working on developing a range of other buses.

- In small commercial vehicles, the Ace platform is being exploited to introduce variants to address various market segments. The Ace EX and Super Ace have been launched and the Company will introduce the multi-purpose vehicle, Venture, the passenger vehicle variant, Magic Iris and the micro-truck Ace Zip.

- The Aria, Indias first indigenously developed crossover vehicle, showcased at the last Auto Expo is expected to be launched in the first half of 2010-11.

- Variants of the Nano, to suit specific needs of the domestic and international markets are being developed. Increased thrust is being made to explore opportunities for launch of the Indica Vista and the Indigo Manza in various international markets.

- In July 2009, Jaguar Land Rover launched to the world, the beginnings of its response to Environmental and C02 challenges with more compact and efficient vehicles. The New XJ launched in early 2010-11, features the next generation Jaguars aerospace-inspired aluminum body architecture enhanced power train with ultra efficient petrol and diesel engine variants, highest standards of personal luxury and specifications, amongst which is its instrument cluster with a 12" thin film transistor (TFT) screen. The Range Rover Evoque, a new more compact product, with class leading C02 performance and technology is under development. The product will showcase technology features including Park-for-you and Magna-ride to deliver outstanding Chassis dynamics, whilst also showcasing increased use of Aluminium and composites for exterior body panels to reduce weight.

Development of Environment-friendly Technologies

As a responsible automobile manufacturer, Tata Motors Group aims to develop vehicles and technologies to reduce the carbon footprint by developing vehicles running on alternative fuels and hybrids such as:

Development of a complete range of CNG vehicles including Ace, Magic, Xenon, Winger, Indigo and also trucks and buses. Over 2200 CNG fuelled buses were supplied to Delhi Transport Corporation. Tata Motors (Thailand) Limited was the first OEM to offer a factory fitted CNG variant of the Xenon pickup in the Thai market. Tata Daewoo Commercial Vehicle Co. Ltd. (TDCV) pioneered the development and introduction of the first Liquefied Natural Gas (LNG) tractor trailer and the LPG MCV truck in the South Korean market.

Hybrid technologies offer perfect solutions for certain commercial vehicle applications. The Company is working on developing Diesel and CNG hybrid solutions for city bus applications in India and also in Spain through its subsidiary Tata Hispano. Tata Hispano received a grant from the Spanish Government for the development of a Hybrid Low Floor City Bus. The Company is working on both, series and parallel hybrid solutions and plans to display the vehicles during the Delhi Commonwealth Games in October 2010. A mild-hybrid on the Ace platform - Ace Ex with a start-stop arrangement which delivers a saving in fuel consumption in heavy traffic conditions was launched in the previous year.

On the electric vehicle range, the Company has secured its position in research and development of electric vehicle technology Ace EV, displayed at Zaragosa exhibition in 2008 and Vista EV displayed at Geneva Motor show in 2009, are in advanced stages of development. These vehicles will be launched in the European markets, especially the northern European market where there are strong fiscal incentives for such vehicles in the urban city centers.

The Company is simultaneously working to introduce a range of technologies, which will help in reducing fuel consumption on its petrol and diesel powered vehicles such as improved fuel injection systems, electric power steering, radial tyres for commercial vehicles, low resistance tyres, automatic transmissions and weight reduction of components.

Despite the severe financial conditions of the last 12 months, Jaguar Land Rover has continued to invest heavily in process and product research. During the past 12 months, 120 technology projects have been progressed toward implementation on future programmes. The 10 model year programmes delivered a range of advanced technologies including Dual View Screen (world first), Continuously Variable Damping, Auto Headlamp Dipping and Advanced All-Round Camera features. All of these were well received by the press and customers alike and served to raise the technology image of Jaguar Land Rover products.

Further, an extensive range of new technologies are under development for future programmes including Series and Parallel hybrid vehicles, with the first generation of full parallel hybrids moving towards application readiness later this year. Other projects include Limo-green (series Hybrid), Power train downsizing, EV transmissions, etc; some of which have been successful in securing government funding.

SUBSIDIARY/ASSOCIATE COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS

a. During the year, the following changes have taken place in subsidiary companies: Subsidiary companies formed/acquired:

- Tata Hispano Motors Carrocera S.A., (Hispano) became a subsidiary consequent upon the Company exercising its put option and increasing its stake from 21% to 100%. Consequently its wholly owned subsidiary Carrosseries Hispano Maghreb, Morocco also became the Company s subsidiary.

- JaguarLandRover Limited, the Companys subsidiary formed the following subsidiaries, viz. Jaguar Land Rover Brazil LLC, Limited Liability Company Jaguar Land Rover (Russia), Land Rover Parts Limited and Land Rover Parts US LLC.

Companies ceasing to be subsidiary companies:

- The Company partially divested 20% stake in Telco Construction Equipment Company Limited (Telcon) in favour of Hitachi Construction Machinery Co. Ltd (Hitachi). Consequently, its stake in Telcon was reduced to 40% (on consolidated basis), resulting in Telcon and its 5 subsidiaries, viz. Serviplem S. A., Baryval Assistencia Tecnica S.L., Comoplesa Lebrero S.A., Inner Mongolia North Baryval Engineering Special Vehicle Corporation Ltd and Eurl Lebrero France, ceasing to be subsidiaries of the Company in March 2010 and have become associate companies.

- INCAT Holdings BV, INCAT KK and Lemmerpoort BV, subsidairies of Tata Technologies Limited and Jaguar & Land Rover Asia Pacific Company Limited, a subsidairy of JaguarLandRover Limited were liquidated.

- Miljo Innovasjon AS was merged with Miljobil Grenland AS.

Name changes:

- Tata Technologies Inc. from INCAT Systems Inc.

- Tata Technologies (Canada) Inc. from INCAT Solutions of Canada Inc.

- Tata Technologies de Mexico, S.A. de C.V from Integrated Systems de Mexico, S.A. de C.V.

- Jaguar Land Rover Nederland BV from Land Rover Nederland BV.

- Tata Hispano Motors Carrocera S.A. from Hispano Carrocera S.A.

b. As required under the Listing agreement with the Stock Exchanges, Consolidated Financial Statements of the Company is attached. In accordance with the Statement of Accounting Standard on Consolidated Financial Statements (AS 21) and the Accounting Standard on Accounting for Investments in Associates (AS 23) and Accounting Standard on Accounting for Joint Ventures (AS 27), issued by the Institute of Chartered Accountants of India, the subsidiaries, associates and joint venture have been considered in the Consolidated Financial Statements of the Company. On an application made by the Company under Section 212(8) of the Companies Act, 1956, the Central Government exempted the Company from attaching a copy of the Balance Sheet and the Profit and Loss Account of the subsidiary companies and other documents to the Annual Report of the Company. Accordingly, the said documents are not being attached with the Balance Sheet of the Company. The gist of financial performance of the subsidiary companies for FY 2009-10 are provided under Subsidiary Companies: Financial Highlights - 2009-10 in the Annual Report. The Company will make available these documents/ details upon request by any member of the Company or its subsidiary companies who may be interested in obtaining the same and will also be kept open for inspection by them at the Registered Office of the Company and at the Head Offices of the subsidiary company concerned. The same would also be posted on the website of the Company.

c. Associate companies

As on March 31, 2010, the Company had the following associate companies:

Tata Cummins Limited (TCL), in which the Company has a 50% shareholding, with Cummins Engine Co. Inc., USA holding the balance. TCL is engaged in the manufacture and sale of high horse power engines used in the Company s range of M&HCVs.

Tata AutoComp Systems Limited (TACO) is a holding company for promoting domestic and foreign Joint Ventures in auto components and systems and is also engaged in engineering services, supply chain management and after market operations for the auto industry. The Companys shareholding in TACO is 26%.

Tata Precision Industries Pte. Ltd., Singapore, in which the Company has a 49.99% shareholding, is engaged in the manufacture and sale of high precision tooling and equipment for the computer and electronics industry.

Nita Co. Ltd., Bangladesh, in which the Company holds 40% equity, is engaged in the assembly of TATA vehicles for the Bangladesh market.

Telco Construction Equipment Co. Ltd. (TELCON), in which the Company divested a further 20% stake during the year in favour of Hitachi, is engaged in the business of development, manufacture and sale of construction equipment and allied services. Consequently Telcon is owned 60% by Hitachi and 40% (on consolidated basis) by Tata Motors.

Fiat India Automobiles Limited, a 50:50 joint venture company between Tata Motors Limited and Fiat Company located in Ranjangaon, Maharashtra is engaged in the manufacture of Tata and Fiat branded products as well as engines and transmissions for use by both the partners.

Automobile Corporation of Goa Ltd. (ACGL), a Company in which Tata Motors Limited has a 42.37% shareholding, was incorporated in 1980, jointly with EDC Limited (a Goa government enterprise). ACGL is a listed company engaged in manufacturing sheet metal components, assemblies and bus coaches and is the largest supplier of buses (mainly for exports) to the Company.

FIXED DEPOSITS

In December 2008, the Company launched a public fixed deposit scheme to meet a part of the funding requirements of the Company. The scheme has received an overwhelming response and the management of the Company is thankful to all the investors for participating in the scheme and the faith reposed in the Company. The aggregate amount collected under fixed deposit scheme as on March 31, 2010 was Rs. 3,173.45 crores from 2,87,343 depositors. The Company has no overdue deposits other than unclaimed deposits. The Company has discontinued the acceptance and renewal of deposits w.e.f. May 28, 2010.

ENERGY, TECHNOLOGY & FOREIGN EXCHANGE

Details of energy conservation and research and development activities undertaken by the Company along with the information in accordance with the provisions of Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, are given as an Annexure to the Directors’ Report.

DIRECTORS

Mr N A Soonawala who had been on the Board of the Company since May 1989, stepped down from the Board of Directors w.e.f. March 31, 2010 in accordance with the ‘Policy for Retirement Age of Non-Executive Directors’ adopted by the Company. His contributions particularly in areas of capital raising, recent acquisitions and its financing/refinancing, financial management and accounting and capital market matters, have helped the Company in meeting its aspirations to become a truly global Company; particularly in times of difficulties such as the global meltdown, market swings, Nano relocation. Mr Soonawala was on the Board for more than 20 years and was a Member of the Executive Committee of the Board, Remuneration Committee and the Nomination Committee. Mr Soonawala had by his counsel and guidance tremendously contributed to the Company over the years in its strategic direction and in its financial structure. The Directors place on record the debt the Company owes to Mr Soonawala in contributing to the Company’s growth and premier position in the automobile industry.

Mr R Gopalakrishnan, a Director of the Company since December 1998, who retires by rotation at the ensuing Annual General Meeting has conveyed his decision not to offer himself for re-appointment. Mr Gopalakrishnan was also a Member of the Executive Committee of the Board, Investors’ Grievance Committee and Ethics and Compliance Committee and has added value to deliberations at Board/Committee Meetings. The Directors place on record their appreciation of the contribution made by Mr Gopalakrishnan during his tenure as Director of the Company.

The Board at its meeting held on May 27, 2010, appointed Mr Ranendra Sen as an Additional Director, w.e.f. June 1, 2010 in accordance with Section 260 of the Companies Act, 1956 and Article 132 of the Articles of Association of the Company.

Mr Carl-Peter Forster was appointed as Chief Executive Officer and Managing Director of the Company w.e.f. April 1, 2010. An abstract and memorandum of interest under Section 302 of the Companies Act, 1956 has been sent to the members of the Company.

In accordance with the provisions of the Companies Act, 1956 and the Articles of Association of the Company, M/s Ratan N Tata and R A Mashelkar are liable to retire by rotation and are eligible for re-appointment.

Attention of the Members is invited to the relevant items in the Notice of the Annual General Meeting and the Explanatory Statement thereto.

CORPORATE GOVERNANCE

A separate section on Corporate Governance forming part of the Directors’ Report and the certificate from the Practicing Company Secretary confirming compliance of Corporate Governance norms as stipulated in Clause 49 of the Listing Agreement with the Indian Stock Exchanges is included in the Annual Report.

AUDIT

M/s Deloitte Haskins & Sells (DHS), Registration No. 117366W, who are the Statutory Auditors of the Company hold office until the conclusion of the ensuing Annual General Meeting. It is proposed to re-appoint them to examine and audit the accounts of the Company for the Financial Year 2010-11. DHS have, under Section 224(1) of the Companies Act, 1956, furnished a certificate of their eligibility for re-appointment.

Cost Audit

As per the requirement of the Central Government and pursuant to Section 233B of the Companies Act, 1956, the Company carries out an audit of cost accounts relating to motor vehicles every year. Subject to the approval of the Central Government, the Company has appointed M/s Mani & Co. to audit the cost accounts relating to motor vehicles for the Financial Year 2010-11.

DIRECTORS’ RESPONSIBILITY STATEMENT:

Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Directors, based on the representation received from the Operating Management, confirm that:

- in the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;

- they have, in the selection of the accounting policies, consulted the Statutory Auditors and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

- they have taken proper and sufficient care, to the best of their knowledge and ability, 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;

- they have prepared the annual accounts on a going concern basis.

ACKNOWLEDGEMENTS

The Directors wish to convey their appreciation to all of the Company’s employees for their enormous personal efforts as well as their collective contribution to the Company’s record performance. The Directors would also like to thank the employee unions, shareholders, fixed deposit holders, customers, dealers, suppliers, bankers, Government and all the other business associates for the continuous support given by them to the Company and their confidence in its management.

On behalf of the Board of Directors

RATAN N TATA Chairman Mumbai, May 27, 2010

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