Igarashi Motors India Limited€¦ · Igarashi Motors India Limited ... Your management has ... i...

Igarashi Motors India Limited

Board of dIrectors K.K.Nohria(chairmaN)

K.igarashi

c.P.DUsaD

g.N.maNi

T.igarashi

Keiichiigarashi

a.j.PrasaD*

KaviTaPrasaD*

m.s.s.sriNaTh*

jacoBmaThew*

ManagIng dIrector P.mUKUND

Head - fInance r.chaNDraseKaraN

coMpany secretary T.s.maharaNi

audItors sharP&TaNNaN

charTereDaccoUNTaNTs

ParsNmaNere,a-wiNg

3rDfloor,602,aNNasalai

cheNNai-600006

Bankers sTaTeBaNKofiNDia

iciciBaNKlimiTeD

regIstered offIce & factory PloTsNo.B-12ToB-15,Phaseii

mePz-sez,TamBaram,

cheNNai-600045.

*appointedasaDirectorw.e.f.28thjuly2011

asameasureofeconomy,copiesoftheannualreportwillnotbedistributedattheannualgeneralmeeting.membersarerequestedtobringtheircopiestothemeeting.

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contents

sl. no. page no.

1. Chairman’sDesk..............................................................4

2. President’sMessage........................................................5

�. Notice...............................................................................6

4. Directors’Report.............................................................11

5. ManagementDiscussionandAnalysisReport...............19

6. CorporateGovernanceReport.......................................2�

7. Auditors’Report..............................................................�4

8. BalanceSheet................................................................�8

9. ProfitandLossAccount..................................................�9

10. SchedulestoAccounts...................................................40

11. SignificantAccountingPolicies.......................................47

12. NotesFormingPartof Accounts....................................50

1�. BalanceSheetAbstractand

Company’sGeneralBusinessProfile.............................61

14. CashFlowStatement.....................................................6�

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from the chairman’s desk…..

Dearshareholders,

Yourmanagementhasjustifiedyourconfidenceinthem,astheywereabletohandlethechallengesfacedbyyourcompanyfortheyears2009&2010,successfully.

Thishasenabledyourcompanytoaddressthegrowthpotentialagainandpostreasonableresultsfortheyear2011.ifeelthisgrowthmomentumwillbecontinuedinthecomingyears.

The demand from our customers continue to be robust and our operations show consistentimprovement.weshouldpostrobustprofitablegrowthinthecomingyears.

Thesignificantimpetustothefinancialstabilityofyourcompanywasprovidedbythestrategicinvestment made by agile electric Drives Technologies and holdings Private limited (agileelectric).

agileelectricwasabletomakethisinvestmentinyourcompanyduetothesubstantialinvestmentbyhBlPowersystemslimited,aleaderinPowersources&electronics.

wefindgreatsynergybetweenthevaluesandvisionofhBlandyourcompany.Thisaugurswell for futuregrowth,asweare in theprocessofmergingagileelectricwithyourcompany.Thisprocessislikelytotakebetween12to18monthstimeasnecessaryforcompletingvariousformalitiesinvolved.

Pleasejoinmeincomplimentingourmanagementteamforthededicationandcommitment.

asalways,iamextremelygratefultoyou,shareholdersforyourunderstandingandpatienceandifeelreasonablyconfidentthatthispatiencewillberewardedintheyearstocome.

withkindregards,

k.k. nohriachairman

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a message from

k. IgarashiPresident,igarashigroup

myDearshareholders,

itismyhappinesstoseethatigarashiindiahasturnedaroundwellandhasreturnedtoProfitability.wewereoneof the fewsmejapanesecompanieswhoset foot in indiaover15yearsago,envisioningtheindianmarkettobecomeagoodfuturegrowthmarket.

myestimationhasnowcometrueandibelieveindiawillbeoneofthelargestandfastestgrowingmarketsinthedaystocome.

carefullyanddeeplyexaminingthebusinessconditionsgloballyandourendeavourtoremainstrongintheareaswesetfoot,wehadtotakeadecisiontoinviteastrongstrategicpartnertotakealeadinindia,drivethegrowthinindia.

iamveryhappythathBlPowersystemslimiteddecidedtoinvestinourcompany,creatingastrategicPartnership.Thiswillexpandthehorizonofbusinessofbothourorganisationsandibelievethatourindiancompanywillbeasignificantbeneficiaryofthisstrategicalliance.

iamveryimpressedwiththeresearchandTechnologycapabilityofhBlandtheclearvisionandstrategicenergyofitschairman.

iamhappytosharewithallourstakeholders,thatihavebeenrightontopofalltheissueswithmycoreandcapableteamandthefutureforourcompanylooksstableandrobust.

asimentionedlastyear,wehavebeencustomerorientedplayersandrespectallourstakeholders.ThishelpedinmaintaininggoodrelationshipswithallourBusinesschainpartnersandstakeholdersandilookforwardtotheyearsaheadwithapositiveoptimismforourcompany.

iwishtomentionthatallourcustomers,suppliers,Bankersandfinanciershavedemonstratedtheirfaithinusandiofferimmensegratitudetoallofthem.ouremployeeshavedemonstratedthematerial theyaremadeof topullupfromtheunprecedentedcrisis,buildasuitablemodeland return to good times once again and consider De-risking as an all important aspect ofmanagement.

itwillnotbeoutofplace tosay, that inmy lifetime,japanhasseenmanygravechallengingsituationsinthepastandcurrentearthquake,TsunamiandNucleardangerhavenotleftjapanfreefromsuchNaturalcalamitiesandDisasters.Butiamconfidentthatthenationwillspringback.

Yoursincerely,

k.Igarashi

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notIceNoTiceishereBYgiveNThaTTheNineteenthannualgeneralmeetingofigarashimotorsindialimitedwillbeheldonThursday,the15thseptember,2011,at3.00p.m.atthesathgurugnananandahall,NaradaganasabhaTrustcomplex,minihall,314T.T.K.road,chennai-600018totransactthefollowingbusiness:

ordInary BusIness

1. Toreceive,considerandadopttheDirectors’report,theauditedBalancesheetasat31stmarch2011,theProfitandlossaccountfortheyearended31stmarch2011andtheauditors’reportthereon.

2. To appoint a Director in place of mr.K.igarashi who retires at this meeting and is eligible for re-appointment.

3. ToappointaDirector inplaceofmr.Keiichi igarashiwhoretiresat thismeetingandiseligibleforre-appointment.

4. Toappointauditorsandfixtheirremuneration.

m/s.sharp&Tannan,charteredaccountants,chennai are the retiringauditorsandareeligible forreappointment.

specIaL BusIness

5. re-appointment of Managing director

Toconsiderand, if thought fit, topasswithorwithoutmodification(s) the following resolutionasanspecialresolution:

“resolveDThaTpursuant to theprovisionsofsections198,269,309readwithschedule Xiiiofthecompaniesact,1956andotherapplicableprovisionsifany,ofthecompaniesact,1956(includingany statutorymodificationsor re-enactment thereof for the timebeing in force)andsubject to suchapprovalsasmaybenecessaryandfurthersubjecttotheapprovalofmembersinthegeneralmeeting,mr.P.mukundbeand isherebyre-appointedas themanagingDirectorof thecompanyfora furtherperiodof5yearsfrom01.04.2011,onthetermsandconditionsassetoutintheexplanatorystatementtothisresolution”.

6. to appoint a director other than a retiring director

Toconsiderand,ifthoughtfit,topasswithorwithoutmodification(s)ifany,thefollowingresolutionasanordinaryresolution:

“resolveD ThaT Dr. a.j.Prasad appointed as an additional Director under section 260 of thecompaniesact,1956intheBoardmeetingheldon28thjuly,2011andwhosetermofofficeexpiresintheensuingannualgeneralmeetingbeandisherebyre-appointedundersection257ofthecompaniesact,1956,andisliabletoretirebyrotation”.



“resolveDThaTmrs.KavitaPrasadappointedasanadditionalDirectorundersection260of thecompaniesact,1956intheBoardmeetingheldon28thjuly,2011andwhosetermofofficeexpiresintheensuingannualgeneralmeetingbeandisherebyre-appointedundersection257ofthecompaniesact,1956,andisliabletoretirebyrotation”.

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“resolveDThaTmr.m.s.s.srinathappointedasanadditionalDirectorundersection260of thecompaniesact,1956intheBoardmeetingheldon28thjuly,2011andwhosetermofofficeexpiresintheensuingannualgeneralmeetingbeandisherebyre-appointedundersection257ofthecompaniesact,1956,andisliabletoretirebyrotation”.



“resolveDThaTmr.jacobmathewappointedasanadditionalDirectorundersection260of thecompaniesact,1956intheBoardmeetingheldon28thjuly,2011andwhosetermofofficeexpiresintheensuingannualgeneralmeetingbeandisherebyre-appointedundersection257ofthecompaniesact,1956,andisliabletoretirebyrotation”.

Place: chennai ByorderoftheBoardDate : july28,2011 forIgarashi Motors India Limited registeredoffice: t.s.MaharaniPlotNo.B-12toB-15,Phaseii, companysecretarymePz-sez,Tamabram,cheNNai-600045.

notes:

a) amemBereNTiTleDToaTTeNDaNDvoTeiseNTiTleDToaPPoiNTaProXYToaTTeNDaND voTe iNsTeaD of himself. a ProXY NeeD NoT Be a memBer. The ProXY formDUlYcomPleTeDmUsTBereTUrNeDsoasToreachTheregisTereDofficeofThecomPaNYNoTlessThaN48hoUrsBeforeTheTimeofThecommeNcemeNTofTheaforesaiDmeeTiNg.

b) The register of members of the company will remain closed from 12th september 2011 to15thseptember2011(bothdaysinclusive)forbookclosurepurpose.

c) members/Proxiesshouldbringtheattendanceslipdulyfilledinforattendingthemeeting.

d) membersarerequestedtonotifychangeinaddress,ifany,incaseofsharesheldinelectronicformto the concerned Depository Participant quoting their iD No. and in case of physical shares to theregisteredofficeofthecompany.

e) shareholdersdesiringanyinformationasregardstheaccountsarerequestedtowritetothecompanyatleast7daysinadvance,soastoenablethecompanytokeeptheinformationready.

f) membersarerequestedtonotethatthedividendforthefinancialyear2003-2004remainingun-claimedfor7yearsfromthedateofdeclarationhasbeentransferredtotheinvestoreducationandProtectionfundestablishedbythegovernmentofindiapursuanttosection205cofthecompaniesact,1956.

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consequently,noclaimshalllieagainstthesaidfundorthecompanyinrespectofanyamountswhichwereun-claimedandun-paidforaperiodof7yearsfromthedatetheyfirstbecomedueforpayment.

g) memberswhohavenotsofarencasheddividendwarrant(s)forthefinancialYears2004-05,2005-06,2006-07and2007-08arerequestedtoseektoissueaduplicatewarrant(s)bywritingtothecompany’sregistrarsandTransferagents,m/s.cameocorporateserviceslimitedimmediately.

h) membersarerequestedtonotethatdividendsunpaid/unclaimedforaperiodofsevenyearsfromthedatethattheybecomedueforpaymentwillbetransferredbythecompanytotheinvestoreducationandProtectionfund(iePf)aspersection205a(5)andsection205cofthecompaniesact,1956.

i) our company’s shares are tradable compulsorily in electronic form and through cameo corporateserviceslimited,registrarsandshareTransferagents.wehaveestablishedconnectivitywithboththedepositories,i.e.NationalsecuritiesDepositorylimited(NsDl)andcentralDepositoryserviceslimited(cDsl).The internationalsecurities identificationNumber (isiN)allotted toyourcompany’ssharesundertheDepositorysystemisiNe188B01013.asonmarch31st,2011,over98%ofourcompany’sshareswereheldindematerializedformandtherestareinphysicalform.

ToenableustoserveourinvestorsbetterwerequestshareholderswhosesharesareinphysicalmodetodematerializesharesandtoupdatetheirbankaccountswiththerespectiveDepositoryParticipants.

anneXure to tHe notIceeXpLanatory stateMent

explanatorystatementannexedtothenoticeoftheNineteenthannualgeneralmeetingofthecompanyasrequiredundersection173(2)ofthecompaniesact,1956.

IteM no.5 : re-appointment of Managing director

The Board of Directors, at their meeting held on 28th july, 2011 re-appointed mr.P.mukund as managingDirectorofthecompanyforafurtherperiodoffiveyearswitheffectfrom01.04.2011,onthefollowingtermsandconditions,subjecttotheapprovaloftheshareholdersinthegeneralmeeting.

Thematerialtermsandconditionsofthere-appointmentisasfollows:

salary

rs.5,00,000(rupeesfivelakhsonly)permonth.

commission

commission,inadditiontosalaryandperquisiteswillbevariableatthediscretionoftheBoardofDirectors,limitedtoamaximumoftheannualsalary.

perquisites

inadditiontosalaryandcommission, themanagingDirectorshallalsobeentitledtoperquisiteswhichwillincludeaccommodation(furnishedorotherwise)orhouserentallowanceinlieuthereof,re-imbursementofexpenditureorallowancesinrespectofmaintenance,utilitiessuchasgas,electricity,water,furnishingandhouse repairs, medical reimbursement, medical insurance, hospital benefits, leave travel concession, forhimselfandhisfamily,personalaccidentinsurance,clubfeesandanyotherreimbursements,allowancesorperquisitesthatmaybepermittedbythecompanyortheBoardofDirectors,toamaximumvalueequaltotheannualsalary.

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“family”mentionedabovemeansthespouse,dependentparentsanddependentchildrenuptotheageof24years.

for thepurposeofcalculating theaboveceilings,perquisitesshallbeevaluatedasper income-taxrules,whereverapplicable.intheabsenceofanysuchrules,perquisitesshallbeevaluatedatactualcosts.

Provisionofcarandtelephoneforuseonthecompany’sbusinessandtelephoneatthemanagingDirector’sresidencewillnotbeconsideredperquisite.

ThefollowingshallnotbeincludedforthepurposesofcomputationofthemanagingDirector’sremunerationorperquisitesasaforesaid:

(i) thecompany’scontributiontoProvidentfundandsuperannuationorannuityfund,totheextenttheseeithersinglyortogetherarenottaxableundertheincome-taxact;

(ii) gratuitypayabletothemanagingDirectoraspertherulesofthecompany;

(iii) encashmentofleaveattheendoftenure,onceasingtobemanagingDirector.

Minimum remuneration

in the event of absence or inadequacy of profits in any financial year during the tenure of the managingDirector, theaforesaidremunerationpayable to themanagingDirectorshallbe theminimumremunerationpayabletohim.

stockoptions:inadditiontosalaryandperquisites,themanagingDirectorwillbeentitledforissue,grantofstockoptionsatthediscretionoftheBoard/compensationcommitteesubjecttotheapplicableceilinglimits.

Thetermsandconditionsofthesaidappointmentmaybealtered,enhancedorvariedfromtimetotimebytheBoardasitmaythink,initsdiscretion,deemfit.

Thismaybetreatedasanabstractofthetermsbetweenthecompanyandmr.P.mukundpursuanttosection302ofthecompaniesact,1956.

YourDirectorsbelievethatsuchissueisintheinterestofthecompanyandthereforerecommendthepassingoftheresolutionatitemNo.5oftheNoticeasaspecialresolution.

NoneoftheDirectorsotherthanmr.P.mukund,areinterestedorconcernedintheresolution.

IteM no.6 : appointment of director other than a retiring director

in pursuant to article 97 of the articles of association, and section 260 of the companies act, 1956,Dr.a.j.PrasadappointedasanadditionalDirectorintheBoardmeetingheldon28thjuly,2011andwhosetermofofficeexpiresatthisannualgeneralmeeting.

inpursuanttosection257ofthecompaniesact,1956,heiseligibleforre-appointmentandanoticehasbeenreceivedfromamemberofthecompanyproposinghiscandidature.

Therelevantresolutionhasbeenproposedasanordinaryresolutionforobtainingtheconsentofmembers.

TheBoardrecommendtheresolutionforapprovalofmembers.

NoneoftheDirectorsotherthanDr.a.j.Prasad,mrs.KavitaPrasadandmr.m.s.s.srinathareinterestedorconcernedintheresolution.


in pursuant to article 97 of the articles of association, and section 260 of the companies act, 1956,mrs.Kavita Prasad appointed as an additional Director in the Board meeting held on 28th july, 2011 andwhosetermofofficeexpiresatthisannualgeneralmeeting.

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NoneoftheDirectorsotherthanmrs.KavitaPrasad,Dr.a.j.Prasadandmr.m.s.s.srinathareinterestedorconcernedintheresolution.


in pursuant to article 97 of the articles of association, and section 260 of the companies act, 1956,mr.m.s.s.srinathappointedasanadditionalDirectorintheBoardmeetingheldon28thjuly,2011andwhosetermofofficeexpiresatthisannualgeneralmeeting.




NoneoftheDirectorsotherthanmr.m.s.s.srinath,mrs.KavitaPrasadandDr.a.j.Prasadareinterestedorconcernedintheresolution.


inpursuanttoarticle97ofthearticlesofassociation,andsection260ofthecompaniesact,1956,mr.jacobmathewappointedasanadditionalDirectorintheBoardmeetingheldon28thjuly,2011andwhosetermofofficeexpiresatthisannualgeneralmeeting.




NoneoftheDirectorsotherthanmr.jacobmathewareinterestedorconcernedintheresolution.

Place: chennai ByorderoftheBoardDate : july28,2011 forIgarashi Motors India Limited registeredoffice: t.s.MaharaniPlotNo.B-12toB-15,Phaseii, companysecretarymePz-sez,Tamabram,cheNNai-600045.

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dIrectors’ reportTo

Theshareholders,

YourDirectorspresenttheirNineteenthannualreportofyourcompany,togetherwiththeauditedaccountsfortheyearended31stmarch2011.

financial results:

Yourcompany’sperformanceduringtheyearascomparedwiththatduringthepreviousyearissummarizedbelow:

(rs.inlakhs)

particulars 2010-11 2009-10

manufacturingsales 18,611.23 14,383.63

Tradingsales 1,110.01 1,486.92

total sales 19,721.24 15,870.55

add:otherincome 40.84 54.23total Incomeless:

19,762.08 15,924.78

(i)materials&manufacturingexpenses 15,340.40 12,619.49

(ii)valueadditioncost 2,661.75 2,280.99profit before depreciation, amortization & obsolescenceless:

1,759.93 1,024.30

(i)Depreciation,amortization&obsolescence 1,053.26 648.05

profit Before tax 706.67 376.25

operatIons:

During the year, your company managed the operations to post a sales growth of 29% and an eBiDTagrowthof47%.

Thecompanyexpandeditscapitalbyrs4959.50lakhsandthishelpedsignificantlyinthestrengtheningoftheBalancesheetandgetbacktocredibilityoffinancialstrengthwithallcustomersandsuppliers.

ThemanagementDiscussionreportdetailsstepstakeninthisarea.

dIVIdend

in view of inadequacy of profits to wipe out the losses of last year, Directors recommend no payment ofDividendtotheirshareholdersfortheyearunderreview.

reserVes

Thereservesattheendoftheyear31stmarch,2011isatrs.6218.58lakhsasagainsttheTotalreservesofrs.1,150.72lakhsasat31stmarch,2010.

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cHange In capItaL structure

During the year under review, your company’s paid up equity share capital has been increased fromrs.138,743,820tors.203,743,820/-bywayofPreferentialallotmentof65,00,[email protected]/-eachatapremiumofrs.66.30persharetoagileelectricDrivesTechnologiesandholdingsPrivatelimitedwithanobjecttoaugmenttheNetworthofthecompany.

otHer Matters

Yourcompanyinvestedanadditionalamountofrs.1428.65lakhsbyincreasingitsstakeupto26%inthejointventurewithBoschelectricalDrivesindiaPrivatelimited.

dIrectors

mr.K.igarashiandmr.Keiichiigarashi,Directorsretirebyrotationattheforthcomingannualgeneralmeetingandbeingeligible,offersthemselvesforre-appointment.

Dr.a.j.PrasadappointedasanadditionalDirectorwitheffectfrom28thjuly,2011andwhosetermofofficeexpiresatthisannualgeneralmeetingandbeingeligible,offerhimselfforre-appointmenttotheBoard.

mrs.KavitaPrasadappointedasanadditionalDirectorwitheffectfrom28thjuly,2011andwhosetermofofficeexpiresatthisannualgeneralmeetingandbeingeligible,offerherselfforre-appointmenttotheBoard.

mr.m.s.s.srinathappointedasanadditionalDirectorwitheffectfrom28thjuly,2011andwhosetermofofficeexpiresatthisannualgeneralmeetingandbeingeligible,offerhimselfforre-appointmenttotheBoard.

mr.jacobmathewappointedasanadditionalDirectorwitheffectfrom28thjuly,2011andwhosetermofofficeexpiresatthisannualgeneralmeetingandbeingeligible,offerhimselfforre-appointmenttotheBoard.

The brief resume/details relating to Directors being re-appointed as stipulated under clause 49(vi)(a)of the listing agreement executed with the stock exchanges are furnished in the report on corporategovernance.

audItors

m/s. sharp & Tannan, auditors of the company retire at the ensuing annual general meeting and beingeligible,offerthemselvesforre-appointment.membersarerequestedtoappointauditorsforthecurrentyearandauthorizetheBoardtofixtheirremuneration.

asrequiredundertheprovisionsofsection224ofthecompaniesact,1956,thecompanyhasobtainedawrittencertificatefromtheaboveauditorsproposedtobere-appointedtotheeffectthattheirre-appointment,ifmade,wouldbeinconformitywiththelimitsspecifiedinthesaidsection.

withreferencetotheauditorsreport,yourDirectorswishtoclarifythatthecompanyalongwithitsassociatecompanyhaveinitiatedactionforcompoundingtheinadvertentoffencesundersections295and297ofthecompaniesact,1956.

esop-2006

Your company had introduced the employees stock option Plan -2006 in accordance with the seBi(employeesstockoptionschemeandemployeesstockPurchasescheme)guidelines1999.Thescheme

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wasapprovedbytheshareholdersattheannualgeneralmeetingofthecompanyintheyear2007.Yourcompanygranted7,50,000stockoptionsduringthecurrentyearoutoftotal12,50,000options.asrequiredunderseBi(employeestockoptionschemeandemployeestockPurchasescheme)guidelines,1999adisclosureisannexedherewith.

HuMan resources

TheBoardofDirectorswishestoplaceonrecordtheirsincereappreciationtoalltheemployeesofthecompanyfortheirdedication,commitmentandloyaltytothecompany,duringtheperiodofcrisiswhichlastedtill2009-10andexercisedpatienceuntiltheturnaroundofthecompany.

asperthe limitsprescribedundersection217(2a)of thecompaniesact,1956readwiththecompanies(Particularsofemployees)rules,1975,mr.P.mukund,managingDirectorofthecompanyreceivedanamountofrs.7,104,585/-asremunerationduringtheyear2010-11.

asrequiredundertheProvisionsofthecompaniesact,1956,thecompanyhasobtainedcentralgovernmentapprovalforpaymentofincreasedremunerationtomr.P.mukund,managingDirectorofthecompanyforaperiodofoneyearfrom01.04.2010to31.03.2011videletterNo.B05040407/5/2011-cl-viidated18.04.2011.

corporate goVernance

a report on corporate governance along with a certificate from the auditors of the company regardingcomplianceoftherequirementsofcorporategovernancepursuanttoclause49ofthelistingagreementwiththestockexchangesareannexedhereto.

Duringtheyear,thecompanyhasgranted4,83,000optionsundertheesoPschemetothemanagingDirectorwhichshallbevestedwithinaperiodofoneyearfromthedateofthegrantofoption.

ManageMent dIscussIon and anaLysIs report

management Discussion and analysis report of the company for year under review as required underclause49ofthelistingagreementwiththestockexchanges,isgivenasaseparatestatementintheannualreport.

conserVatIon of energy, tecHnoLogy aBsorptIon

Theinformationrequiredtobefurnishedpursuanttosection217(1)(e)ofthecompaniesact,1956readwiththecompanies(DisclosureofParticularsinthereportofBoardofDirectors)rules,1988,isappendedheretoandformspartofthisreport.

foreIgn eXcHange earnIngs and outgo

Thedetailsofexpenditureandearningsinforeigncurrencyaregivenintheprescribedformatasanannexuretothisreport.

dIrectors’ responsIBILIty stateMent

incomplianceofsection217(2aa)oftheact,yourdirectors,onthebasisofinformationmadeavailabletothem,confirmthefollowing:

a) inthepreparationoftheannualaccounts,theapplicableaccountingstandardshavebeenfollowedwithexplanationrelatingtomaterialdepartures,ifany;

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b) theyhaveselectedsuchaccountingpoliciesandappliedthemconsistentlyandmadejudgmentsandestimatesthatarereasonableandprudentsoastogivetrueandfairviewofthestateofaffairsofthecompanyasat31stmarch2011andoftheprofitofthecompanyfortheyearendedonthatdate;

c) Proper care has been taken for maintenance of adequate accounting records for safeguarding theassetsofthecompanyanddetectingfraudandotherirregularities;

d) Theaccountsarepreparedonagoingconcernbasis.

deposIts

Duringtheyearunderreview,yourcompanyhasnotinvitedoracceptedanydepositsfromthepublicundersection58aofthecompaniesact,1956andrulesmadethereunder.

QuaLIty and enVIronMent:

YourDirectorsarepleasedtoinformyouthatduringtheyearyourcompanycontinuedtoworkonliveaPQP(advanced Product Quality Planning) processes for different Programs in the automotive industry. ThisensuresaneffectiveadvancefailuremodeanalysistoensurethatQualitygetsbuiltintotheDesignaswellasProcess.

LIstIng

ThesharesofyourcompanycontinuedtobelistedatNationalstockexchange,Bombaystockexchangeandmadrasstockexchanges.listingfeehasalreadybeenpaidforthefinancialyear2010-11.further,annualcustodyfeehasalsobeenpaidtoNsDlandcDsl.

acknoWLedgeMent

TheBoardplacesonrecorditssincereappreciationforthecontinuedsupportfromtherelevantgovernmentauthorities, Promoter companies, shareholders, suppliers, customers, employees and other businessassociates,fortheirstrongsupport.

forandonbehalfoftheBoardofDirectors

Place :chennai k.k nohriaDate : july28,2011 chairman

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anneXure to tHe dIrectors report

a. conserVatIon of energy

energy conservation Measures taken:

• lightingenergycontrollerinstalledforreducing20%ofthetotallightingpower;

• scrollcompressorsandoccupancyserversinstalledforcontrollingair-conditioningusage;

• PlantadoptedcompleteUtilitypowertoreducefuelconsumptionbyenhancingdemandfrom1000Kvato1750Kva–Thishasresultedinthepowercostsavinguptors.1.5croresinspiteofTNeBrestriction;

• optimumPressureBandshavebeeninstalledforimprovingtheefficiencyofPneumaticcompressorswhichhasresultedinsubstantialreductioninpowerconsumption;

• allmachineshavebeeninstalledwithlogiccontrollerstostoptheequipmentwhichisidleformorethan15minutesascomparedtolastyearwhere20%ofthemachineswerepending.

B. tecHnoLogy aBsorptIon

form B

technology, absorption, adaptation and innovation

a. efforts,inbrief,madetowardstechnologyabsorption,adaptationandinnovation:

- continuedtoDevelopnewproductsatindia,co-operatingwithlargecustomerstocreateProductsfortheglobalplatform;

- Diversified into studying new types of electric motors for future and alternative segmentapplications;

- continuouslyimprovingequipmentandmachineryTechnologyforimprovedproductivity;

- Understandingofnewhi-Technologyandmoreefficientmanufacturingprocessesforcomponentmakingresultinginqualityimprovementandcostreduction.

b. Benefitsderivedasaresultoftheaboveefforts:

- openedupnewglobalmarketopportunities;

- startedworkingwitheuropeancompaniesforsupplyingequipmentwithlowcostautomation;

- supported the establishment of a hi Quality supply chain around your company and launchbusinessofthoseproductsindependently;

- launchedtheDevelopmentofNewproducts-motorsfordomesticmarket.

c. expenditureonNewProductDevelopment (rs.lakhs)

2010-11 2009-10

Programexpenditureincurredduringtheyear 5.24 38.08

Programexpenditureamortizedduringtheyear 106.00 106.58

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d. informationregardingimportedtechnologyduringthelast5years:

i) Technologyimported:PermanentmagnetDcmicromotorsTechnology

ii) Yearofimport:1993-94

iii) status:absorbed

iv) ifnotfullyabsorbed:Notapplicable

c. foreIgn eXcHange earnIngs and outgo

a. activitiesrelatingtoexports;initiativestakentoincreaseexports;developmentofnewexportmarketsforproducts&exportplans:

asthecompanyis100%exportoriented,referparaon“BusinessProspects”ofthemainreport

b. Totalforeignexchangeusedandearned: (rs.lakhs)

2010-11 2009-10

Totalforeignexchangeearned 18,504.35 15,419.56

Totalforeignexchangeused 11,656.59 9,144.66

{excludespaymentsforcapitalgoodsrs.1170.34lakhs

(PreviousYear:rs.179.73lakhs)}


Place : chennai k.k nohriaDate : july28,2011 chairman

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detaILs of stock optIons pursuant to seBI guIdeLInes on stock optIons

esop scheme-2006

Description esoPscheme-2006

No.ofoptionsavailableunderesoPscheme-2006 12,50,000(9%)

a) No.ofoptionsgrantedduringfY2010-11 7,50,000

B) ThePricingformula Theexercisepriceforthepurposesofthegrantofoptions as decided by the esoP compensationcommittee is rs.40.15, the price being not lessthan the Par value of the equity share of thecompanyandnotmorethanthemarketpriceason17thannualgeneralmeetingdate(i.eseptember30,2009)beingrelevantdatesubjecttotheseBi(employee stock option scheme and employeestockPurchasescheme)guidelines,1999.

c) optionsvestedduringfY2010-11 Nil

D) optionsexercisedduringfY2010-11 Nil

e)Thetotalnumberofsharesarisingasaresultofexerciseofoption

Nil

f) optionslapsedfY2010-11 Nil

g) variationTermsofoptions Nil

h) moneyrealizedbyexerciseofoptions Nil

i) TotalNumberofoptionsinforceasonmarch31,2011

7,50,000

j) employee-wisedetailsofoptionsgrantedto Detailsasunder:

i) seniormanagerialPersonnel

ii) anyotheremployeewhoreceivesagrantinanyoneyearofoptionamountingto5%ormoreofoptiongrantedduringtheyear

iii) identifiedemployeeswhoweregrantedoption,duringanyoneyear,equaltoorexceeding1%of the issued capital (excluding outstandingwarrants and conversions) of thecompanyatthetimeofgrant

1,75,000options

Nil

managingDirector4,83,000options

18


19

K) DilutedearningsPershare(ePs)pursuanttoissueofsharesonexerciseofoptioncalculatedinaccordancewith accounting standard (as) 20 “earnings Pershare”

rs.4.92

l) i) the method of calculation of employeecompensationcost

fairvaluemethod

ii) Differencebetweentheemployeecompensationcostsocomputedat(i)aboveandtheemployeecompensation cost that shall have beenreorganized if it had used the fair value ofoptions

N.a

iii) The impactof thedifferenceonprofitsandonePsofthecompany

N.a

m) weighted average exercise prices and weightedaverage fair values of options shall be disclosedseparately for options whose exercise price eitherequalsorexceedsorislessthanthemarketprice

N.a

N) adescriptionofthemethodandsignificantassumptionsused during the year to estimate the fair values ofoptions , including the following weighted averageinformation:

1) risk-freeinterestrate

2) expectedlife;

3) expectedvolatility;

4) expecteddividendsand

5) Thepriceofunderlyingshare inmarketat thetimeofoptiongrant

N.a


Place : chennai k.k nohriaDate : july28,2011 chairman

18 19

ManageMent dIscussIon and anaLysIs report

gLoBaL autoMotIVe Industryasunprecedentedinhistorywasthecrisisof2008and2009,sowastherecoveryinYear2010.Theglobalautomotiveindustrysurpasseditspreviousbestlevelsandthemaindriverforthiswasasiaandsouthamerica.Theautomotiveindustryreachedarecordlevelof76millioncarsandcommercialvehiclesin2010.chinaandindiashowedaverydramaticincreaseintheautomotiveproductionin2010aswell.

interestingly, the recoveryofgiants likegeneralmotors,fordandchrysleradded to theadvancement inapplicationofnewerTechnologyproductsandenabledtosupplychainmembersalsotoparticipateinsuchProjects.ithadbecomeclearthatthosewhosurvivedthecrisishaveandwillbenefitinthecomingyearstotaketheirBusinessforward.

sHIft In MarketsThegeographicalsplitofsalesofourcompanyduringtheperiod2010-11isrepresentedinchartbelow.Thisisindicativeofhowourcompany’ssalesareshiftinginlinewiththemarketshifttoasiaand,itwillcontinuetodoso.

eXports’ track recordYourcompanyhaspopulatedover367millionpiecessinceinceptioninglobalautomotivecomponentindustryvaluedatover17899millionasseeninthechartbelow:

20


21

eXperIences

Buildingupontheextremeexperiencesofthepreviousyear,themanagementhastakenaveryclearviewthatitisveryimportanttostabilizeonalloperationalandfinancialparametersbeforetargetingmajorgrowth.ithadbecomeclearthatthevacillationsofthemarketwhichthecompanyexperiencedinthelast5yearsshouldprovideadeeperdirectionforstabilizedgrowthinthefuture.

higherdegreeofcertaintyinallaspectsshouldbebuiltupanditisimportanttotakeupalimitedBusiness,anddoitwell,whilewestrengthenourselvesfinancially,improveBargainingPowerwithlargecustomersandsuppliersandimproveouroperationalmanagement.

Thespecificareasofexperiencesarecitedbelow:

1. Business:

Boschwasaveryimportantcustomerwholedourrecoveryandgrowthandco-operativefunctionalteamsweresetupbetweenBoschandourcompanywhichensuredboth–QualityandstabilityofBusiness.

ThesecondmajorProjectthattookoffwastheUscarprojectthatwehadbeenworkingwiththeUscarindustryformanyyears.

on theTechnologydesk,wehavesome interestingprojects related toelectricmotorsandwith thefinancialstrengthening,wewilladdressnewprojectsaswegoalong.

gradualtakeoffontheprojectswiththeBoschjointventurealsobecamevisibleandthenext3yearsshouldseestrongbuildup.

overallontheforecast,theestimatesarealotmorecertainforbettergrowthinthecomingyears.

2. operational profitability:

Thereisasustainedimprovementintheoperationsandprofitabilityasseeninthedetailsgivenbelowanditisexpectedtocontinueinthecomingyearaswell.

Thecomparativeresultsaregivenbelow:

fY2009-10 fY2010-11 growth (rs.incrores) (rs.incrores) %

sales 143.84 186.11 29%

eBiDTa 18.75 27.64 47%

3. strategic strengthening :

withtheexperienceintheindustryforthepast15years,ithadbecomeclearthatifwehavetogrowtobecomeanimportantplayerintheautomotive/electricmotorsBusiness,itisimportanttobuildstrategicPower,specificallywithregardtosize,scaleandfinancialabilities.

Duringtheyear,veryextensivediscussionstookplaceacrossallarmsandrelationshipsofourcompanyandaftercarefulanaylsis,hBlPowersystemslimiteddecidedtoinvestinourcompanyasastrategicpartnerandtakeleadintheownershipofthecompany.

20 21

Thiswasaveryimportantprerequisitetocapitalizeonthetractionsbuilt.hBlPowersystemslimited–aleaderinbatteryTechnologyandelectronics,investedintothecompanywithexpandedcapitalandstrengthenedthecompany’sfinancialPowers.

BetweenhBlandigarashi,wearenowapartofgreaterthan400millionUs$Businessgroupandthepositiveeffectofthisonourcompanywillbecomevisibleintheperiodstocome.

igarashi from japan continued to support and banks and institutions also took positive note of thechangesthattookplaceinthepast2years.

4. future Business outlook:

asannouncedintheopenofferdocumentduringthecomingyear,thecompanywillinitiateallactionsto merge all the indian operations related to electric motors in one single entity and this group isexpectedtogeneraterevenuesofover100millionUs$in2yearsandthereafter-looktodoublinginthenext3to4years.

risks & concerns :

i) global auto Industry :

Yourcompanyisoperatinginglobalautomotiveindustrywhichwentthroughitsworstcycleinhistoryduringthe2008and2009butbouncedbacktorecordlevelsin2010.whileyourcompanyhadtobleedduringthedowncycle,nowwehavebuiltthenecessarystrengthstoweathersuchcycleinamorestablemanner.ataBroaderlevel,sometalksarelaunchedwithNonautomotiveplayerswhosourceelectricmotors.

TheProductandmarketsegmentdiversificationisprogressingwellandinacoupleofyearswewillseearightmixbetweengeographiesandProductsegments.

ii) Insurance :

as your company addresses global automotive component industry, it is exposed to various riskssuchasfirerisk,machineryBreakDownrisk,Productliabilityrisk,marinerisketc.Yourcompanyregularlyreviewsandwhereverpossible,usestheinstrumentofinsurancetomitigatetheserisks.

iii) Interest rates:

with interest rates going up, your company’s interest burden increased in absolute terms. activedialoguesare inprogress tosee if someof theborrowingscanbesubstitutedbyforeigncurrencyborrowingasthereisanaturalhedge.

iv) exchange risk :

Yourcompanyisexposedtothefluctuationsinforeignexchangeratesonexportsandimports.sincethematerialspurchasedareimported,thereisanautohedgemechanism.however,basedonthepastexperiences,thecompanyisquotingwithacurrencyvariationfactortominimizefurther.atabroaderlevel, thecompany isdevelopingmarkets in indiasothat thewholebusiness is fairlyderiskedfromcurrencyfluctuations.

22


2�

v) product Liability, Warranty claims and product recall risks :

Yourcompany,beingautomotivecomponentsuppliers,facestheinherentbusinessriskofexposuretowarrantyandproductliabilityclaimsintheeventthatitsproductsfailtoperformasexpectedorsuchfailureresultsinbodilyinjuryorpropertydamage.Though,yourcompanyhadinsurancecoverage,anyclaiminexcessofavailableinsurancecoveragewouldhaveadverseeffectsoncompany’sbusiness.

segMent WIse/ product WIse perforMance

Yourcompanyisengagedinthebusinessofautocomponentsforautomobiles.since,thisisonlyonesegment,hencethereisnosegmentwisereporting.

InternaL controL systeMs & adeQuacy

Your company has in place adequate systems of internal control and documented procedures coveringall financialandoperatingfunctions.all theassetsaresafeguardedandprotectedandall transactionsarerecordedpromptly.internalauditiscarriedoutinaprogrammedwayandfollowupactionsweretakenforallauditobservations.

MaterIaL deVeLopMents In HuMan resources

ThemeasurestakenduringtheperiodofeconomicrecessionasanopportunityratherthanacrisisandprovidinghumanresourceleadershipandDevelopmenthelpedinthebuildingoftheorganisation.aconsequenceofthiswasimprovedQualityofBusinessandoperationswasprogressivelybeingbuilt.

cautIonary stateMent

Thisreportcontainsforwardlookingstatements.allsuchstatementsaresubjecttorisksandun-certainties.actualresultscoulddiffermateriallyfromthoseexpressedorimplied.

forIgarashi Motors India Limited

Place: chennai p. MukundDate : july28,2011 managingDirector

22 2�

corporate goVernance report1. coMpany’s pHILosopHy on corporate goVernance

Yourcompany iscommitted toadopt thebestglobalpracticesofcorporategovernance.corporategovernanceenvisagescommitmentofthecompanytowardstheattainmentofhighlevelsoftransparency,accountabilityandequitywiththeultimateobjectiveofincreasinglong-termshareholdersvalue,keepinginviewtheneedsandinterestsofallotherstakeholders.

Yourcompanyalsobelievesthatgoodcorporategovernancemakesgoodbusinesssense.assuchyourcompanynotonlycomplieswithallrequirementsofcorporategovernancelaidbyvariousbodies,butfollowsitinspiritalso.

Duringtheyearended31stmarch,2011,yourcompanyhadcompliedwiththecodeprovisionssetoutinthecodeofcorporategovernancePracticescontainedintheappendix14oftherulesgoverningthelistingofsecurities(the“listingrules”)onNse,Bseandmseandweareinreceiptofacertificatefrommseforgoodcomplianceduringtheentireyear2010-11.

2. coMposItIon of Board

ason31stmarch,2011theBoardofDirectorscomprisedthemanagingDirectorand6Non-executiveDirectors.

Duringtheyear,sixBoardmeetingswereheldon20thmay2010,22ndjuly2010,16thseptember2010,27thoctober2010,06thDecember2010and29thjanuary2011.Thecompany’slastannualgeneralmeetingwasheldon16thseptember2010.

The particulars of Directors, their attendance during the financial year 2010-2011 and also otherDirectorshipsandBoardcommitteerepresentationsofPubliclimitedcompaniesareasunder:

name of director & designation

category

attendance other Board representations*Board

Meetings Last agM

director ship committees $

mr.K.K.Nohriachairman

Non-executiveindependent

5 Yes 10 5

mrP.mukundmanagingDirector

executive 6 Yes Nil Nil

mr.T.igarashi Non-executiveNon-independent

3 No Nil Nil

mr.K.igarashi Non-executiveNon-independent

2 Yes Nil Nil

mr.Keiichiigarashi Non-executiveNon-independent

4 No Nil Nil

mr.c.P.Dusad Non-executiveindependent

6 Yes Nil Nil

mr.g.N.mani Non-executiveindependent

6 Yes 1 1

* excludingDirectorshipsinPrivateandforeigncompanies $ includesauditandshareholdersgrievancescommitteesofPubliclimitedcompaniesonly

24


25

InforMatIon aBout dIrectors retIrIng By rotatIon seekIng re-appoIntMent

1. mr.K.igarashi,age73yearsold, is theworldwideheadof igarashigroupas itsPresidentandhasbeen in international business for over 4 decades from japan. he was responsible for globalizingigarashiandmovetowardschinaandindiaforoperationsandhasbuiltaglobalsalesandmarketinginfrastructureinUsa,europeandfareast.

mr.K.igarashidoesnotholdanyshares inhis individualnamebut igarashielectricworkslimited,japanofwhichheisapromoterholds9,67,648sharesinthecompanyason31stmarch2011.

mr.K.igarashidoesnotholdanypositioninPublic/Privatelimitedcompaniesinindia.

relationshipwithotherDirectors:

mr.K.igarashiisafatherofmr.KeiichiigarashiandalsoBrotherofmr.T.igarashi.

2. mr.Keiichi igarashi,age45yearsold, isaDirectorandTechnicalgraduate fromjapanhasover17yearsofexperience.hehasworkedintenselyintheQualitymanagementinmatsushita,japanbeforemovingtoigarashichina.heisthemanagingDirectorofigarashijapan&chinaandisresponsibletoglobalisingigarashitothenextlevel.

mr.Keiichiigarashidoesnotholdanysharesinhisindividualnamebutigarashielectricworks(h.K.)limited,hongkong(subsidiaryofigarashielectricworkslimited,japan)holds2,499,993sharesinthecompanyason31stmarch2011.


mr.Keiichiigarashiisthesonofmr.K.igarashi.

3. Dr.a.j.Prasad,age65yearsold,isaPromoterDirector.heisanengineeringgraduateinTechnologyfrom iiT, Kharagpur and a Post graduate in management from miT, Usa and also a Doctorate ininternationalBusinessfromcolumbiaUniversity,Usa.heisthechairmanandmanagingDirectorofhBl Power systems limited, hyderabad. The company is in the business of design, developmentandmanufactureofspecializedbatteriesandassociatedelectronics.Dr.a.j.PrasadistheheadofhBlgroup.hehasover33yearsofexperienceinthefieldofspecializedbatteries.

Dr.a.j.PrasaddoesnotholdanysharesinhisindividualnamebutagileelectricDrivesTechnologiesandholdingsPrivatelimited(subsidiaryofhBlPowersystemslimited)inwhichheisaDirectorholds12,824,225sharesinthecompanyasonmarch31,2011.


Dr.a.j.Prasadisthefatherofmrs.KavitaPrasadandfather-inlawofmr.m.s.s.srinath.

4. mrs.KavitaPrasad,age39yearsold,isaPromoterDirector.sheisacommercegraduateandaPostgraduateDiplomaholderincomputerapplications.sheisafinanceDirectorinhBlPowersystemslimitedandhasover15yearsexperienceinthefinancialactivitieswithspecificfocusonexportmarketandoperationsofthecompany.

mrs.KavitaPrasaddoesnotholdanysharesinherindividualnamebutagileelectricDrivesTechnologiesandholdingsPrivatelimited(subsidiaryofhBlPowersystemslimited) inwhichshe isaDirectorholds12,824,225sharesinthecompanyasonmarch31,2011.


mrs.KavitaPrasadisthedaughterofDr.a.j.Prasadandwifeofmr.m.s.s.srinath.

5. mr.m.s.s.srinath,age41yearsold,isaPromoterDirector.heisagraduateinartswithspecializationin economics. he is a whole-time Director in hBl Power systems limited and has over 16 yearsexperienceinthemarketingactivitiesandin-chargeofoveralladministrationofthecompany.

mr.m.s.s.srinathdoesnotholdanysharesinhisindividualnamebutagileelectricDrivesTechnologiesandholdingsPrivatelimited(subsidiaryofhBlPowersystemslimited)inwhichheisaDirectorholds12,824,225sharesinthecompanyasonmarch31,2011.


mr.m.s.s.srinathisthehusbandofmrs.KavitaPrasadandson-inlawofDr.a.j.Prasad.

24 25

6. mr.jacobmathew,age45yearsold, isan independentDirector.he isacivilengineerandaPostgraduateDiplomaholderinmanagementfromiim,calcutta.heisthefounderandmanagingDirectorof maPe advisory group which was started in the year 2001 with offices in mumbai, chennai andBangalore.maPeistheinvestmentBankwhichisamongthetop10firmsintheBloombergleagueTableforindia.maPehasworkedwithleadingcorporates,viz.,Dr.reddylabs,ranbaxy,wockhardt,iNggroup,l&T,indianoil,glenmark,crisil,icicigroup,godrejgroup.

mr.jacobmathewdoesnotholdanysharesinhisindividualcapacityinthecapitalofthecompany.

3. audIt coMMIttee

Particularsoftheauditcommittee:

sl. no. particulars details

1. Dateofformation 22ndoctober20002 NoofDirectors 43. Particularsofmembers mr.c.P.Dusad(chairman)

mr.g.N.manimr.T.igarashimr.KKNohriaout of four Non-executive Directors, three directors are alsoindependentDirectors.

4. Noofmeetingsheld During the financial year 2010-2011 meetings were held on20th may 2010, 22nd july 2010, 27th october 2010 and29thjanuary2011.

5. meeting&attendanceDuringtheYear

NameoftheDirector Noofmeetingsattendedmr.c.P.Dusad 4mr.g.N.mani 4mr.T.igarashi 3mr.K.K.Nohria 3

6 functionsoftheauditcommittee

• review of company’s audited financial statements andreports

• adequacyofinternalauditfunctionandsystems• recommending to the Board, the appointment, re-

appointment and if required, the replacement or removalof the statutory auditors and the internal auditors and thefixationofauditfees

• reviewofcompliancewithaccountingstandards• Tolookintothereasonsforsubstantialdefaultsinthepayment

tothedepositors,debentureholders,shareholders(incaseofnonpaymentofdeclareddividends)andcreditors

• reviewofriskmanagementPoliciesandPractices• review financial statements in conformity with generally

acceptedaccountingPrinciples(gaaP)• reviewofstatutorycompliance

Thecompanysecretarymrs.T.s.maharaniactsasthesecretarytothecommittee.

Duringtheyear,besidestheregularreviewofthefinancialreportingprocesses,financialstatements,internal control systemsof the companyandcompliancewith regulatoryguidelines,were reviewed.Thecommitteeheldregularinteractionwithstatutoryauditorsandinternalauditorstobenefitfromtheirprofessionalperspectiveonthecompany’saccounts.

26


27

4. reMuneratIon coMMIttee & dIrectors’ reMuneratIon

although not mandatory in terms of the listing agreement with the stock exchanges the companyhasaremunerationcommitteecomprising3Non–executive&independentDirectors.Presently,thecommitteecomprisesmr.K.K.Nohria(chairman),mr.c.P.Dusadandmr.g.N.mani.

Duringtheyear,therewasacommitteemeetingheldon06thDecember,2010.

Managing director:

althoughthelistingagreementandthecompaniesactrequiretheremunerationcommitteetoonlyreviewtheremunerationpaidtothemanagingDirector,thecommitteeaspartofitstermsofreference,alsoreviewstheremunerationofseniorexecutivesasandwhentheycomeforreview.

ThedetailsofremunerationpaidtothemanagingDirectorforthefinancialyear2010-2011isasunder:

name salary perquisites retirement Benefits

performance Incentive/

commission

others total

rs. rs. rs. rs. rs. rs.Mr. p. Mukund Managing director

48,00,000 23,04,585 - - - 71,04,585

Duringtheyear,thecompanyhasgranted4,83,000optionsundertheesoPschemetothemanagingDirectorwhichshallbevestedwithinaperiodofoneyearfromthedateofthegrantofoption.

as required under the Provisions of the companies act, 1956, the company has obtained centralgovernmentapprovalforincreaseinthemanagingDirector’sremunerationforoneyearperiodfrom01.04.2010to31.03.2011videletterNo.B05040407/5/2011-cl-viidated18.04.2011.

remuneration policy:

Payment of remuneration to the managing Director is governed by the resolution recommended bythe Board and approved by the shareholders. The remuneration structure comprises of salary,commission,perquisitesandotherallowances.TheindependentNon-executiveDirectorsdonotdrawanyremunerationfromthecompanyotherthansittingfees.

Thedetailsofsitting feespaid to theNon-executiveDirectors for the financialyear2010-2011 isasunder:

name of the director sitting fees paid rs.

mr.K.K.Nohria 25,000

mr.c.P.Dusad 30,000

mr.g.N.mani 30,000total 85,000

The Non executive & Non independent Directors viz. mr. K. igarashi, mr. T. igarashi andmr.Keiichiigarashihavenotbeenpaidanysittingfees.independentDirectors,mr.KKNohriaholds2,20,000shares(1.08%),mr.cPDusadholds1shareandmr.gNmaniholds601sharesinthecapitalofthecompany.

mr.Kigarashi,mr.Tigarashiandmr.Keiichiigarashihavenotheldanysharesindividuallyinthecapitalofthecompany.

26 27

5. sHareHoLders’/ InVestors’ grIeVances coMMIttee

Particularsofshareholders’committee:

sl. no. particulars details

1. Dateofformation 22ndoctober2000

2 NoofDirectors 3

3 Name&Designationofcomplianceofficer

T.s.maharanicompanysecretary

4. Particularsofmembers mr.gNmani(chairman)mr.cPDusadmr.Tigarashiout of three Non-executive Directors, two directors are alsoindependentDirectors.

5. Noofmeetingsheld During the financial year2010-2011meetingswereheldon the20th may 2010, 22rd july 2010, 27th october 2010 and 29thjanuary2011.

6. meeting&attendanceDuringtheYear

NameoftheDirector Noofmeetingsattended

mr.gNmani 4

mr.cPDusad 4

mr.T.igarashi 3

7 functionsoftheshareholder’scommittee

reviewofinvestorredressalreport

approvalofshareTransfer&Demat

reviewofsecretarialmis

Duringtheyear2010-2011,thecompanyreceivednilcomplaintsfromtheinvestors.ason31stmarch2011therewerenoinvestorgrievancespendingandnotransferwerependingforapproval.

6. generaL Body MeetIngs

a) Particularsofannualgeneralmeetings(agm)heldduringlastthreeyears:

financial year date Venue time special resolutions passed

2009-10 16thseptember2010

musicacademy,minihall,306,T.T.Kroad,chennai–600014.

3.00P.m. raisingofadditionalfundseitherby way of Qualified institutionalBuyersorbyanyothermeans


musicacademy,minihall,306,T.T.Kroad,chennai–600014.

4.00P.m. Nospecialresolution


musicacademy,minihall306,T.T.Kroadchennai–600014

10.00a.m i) De-listing of shares from themadras stock exchangelimited

ii) re-setting of exercise priceunderesoPscheme2006

28


29

B) Detailsonextra-ordinarygeneralmeetingheldduringtheyear-None

c) During the year 2010-11, pursuant to section 192a of the companies act, 1956 the shareholdersof the companyhaveapproved the following resolutionsbymeansofPostalBallot on08thjanuary2011.

itemNo.1:specialresolutionforPreferentialissueofequitysharestoselectgroupofPersons.

itemNo.2:specialresolutionforcorporateguaranteegiventom/s.sicomlimited,mumbai

itemNo.3:specialresolutionforamendmenttoemployeesstockoptionscheme

followingistheresultofthePostalballot:

sl. no. particulars Item no. 1 Item no. 2 Item no. 3

1 Numberofvalidpostalballotformsreceived 220 220 220

2 votesinfavouroftheresolution(No.ofshares) 8653122 8655516 8669123

3 votesagainsttheresolution(No.ofshares) 27879 24187 10579

4 NumberofinvalidPostalBallotformsreceived 14 14 14

shri.swaminathanganesh,seniorPartnerofs.ganesh&associates,Practicingcompanysecretariesactedasascrutinizerforconductingthepostalballotinafairandtransparentmanner.

7. dIscLosures

The company has complied with all the requirements relating to related party transactions and thedetailswerereportedinschedule2ofthenotesformingpartofaccounts.

ThecompanyhascompliedwithallrequirementsofthelistingagreementwithstockexchangesaswellastheapplicableregulationsandguidelinesprescribedbyseBi.Duringthelastthreeyears,therewerenopenaltiesimposedonthecompanybyanystatutoryauthoritiesfornon-complianceonanymatterrelatedtocapitalmarket.

TheNon-executiveDirectorshavenomaterialpecuniaryrelationshiportransactionwiththecompanyintheirpersonalcapacity.

Thecompanyhasfullycompliedwiththeapplicablemandatoryrequirementsofclause49.

ThecompanyadoptednonmandatoryitemofconstitutingtheremunerationcommitteenotonlyreviewtheremunerationpaidtothemanagingDirectorbutalsoreviewingtheremunerationofseniorexecutivesasandwhentheycomeforreview.

Thecompanyhasnosubsidiarycompany.

inpreparationofthefinancialstatements,thecompanyhasfollowedtheaccountingstandardsissuedbytheinstituteofcharteredaccountantsofindia.ThesignificantaccountingpolicieswhichareconsistentlyappliedhavebeensetoutintheNotestotheaccounts.

8. WHIstLe BLoWer poLIcy

wehaveestablishedamechanismforemployeestoreportconcernsaboutunethicalbehavior,actualorsuspected fraudorviolationofourcodeofconductorethicspolicy. italsoprovides foradequatesafeguardsagainstvictimizationofemployeeswhoavailofthemechanismandalsoallowsdirectaccesstothechairpersonoftheauditcommitteeinexceptionalcases.wefurtheraffirmthatnoemployeehasbeendeniedaccesstotheauditcommittee.

28 29

9. Means of coMMunIcatIon

Duringtheyearunderreference,quarterlyresultswerepublishedinwidelycirculatingnationalandlocaldailynewspaperssuchastheBusinessstandardandDinamalar.Thesewerenotsentindividuallytotheshareholders.Thequarterlyandtheannualresultsofthecompanyarefaxedtothestockexchangesonwhichthecompany’ssharesarelisted,immediatelyofclosureofmeetingoftheBoardofDirectors.

Themanagement’sdiscussionandanalysisformspartofannualreport.

10. generaL sHareHoLder InforMatIon

i. annualgeneralmeeting Date : 15thseptember,2011at3.00P.m. venue : sathgurugnananandahall,Naradaganasabha Trustcomplex,minihall,314,T.T.Kroad chennai–600018

ii. financialcalendar : 1staprilto31stmarch a) firstQuarterresults : 22ndjuly2010 b) secondQuarterresults : 27thoctober2010 c) ThirdQuarterresults : 29thjanuary2011 d) lastquarterresultsand annualauditedresults : 26thmay2011

iii. DateofBookclosure : 12thseptember,2011to15thseptember,2011

iv. listingonstockexchanges : Thecompany’ssharesarelistedonBse,Nse& msebutareeffectivelytradedonlyontheBombay stockexchangelimitedandNationalstock exchangelimited

1. TheBombaystockexchangelimited(Bse) PhirozejeejeebhoyTowers Dalalstreet,mumbai–400023

2. Nationalstockexchangeofindialimited(Nse) exchangePlaza,5thfloor g-Block,BandraKurlacomplex Bandra(west),mumbai–400051

3. madrasstockexchangelimited(mse) “exchangeBuilding”,11,secondlineBeach PostBoxNo.183,chennai–600001

v. listingfees : Thelistingfeeofallthestockexchangesfortheyear 2011-2012hasalreadybeenpaid.

vi. stockcodes :sl. no name of stock exchange stock code

1 Nationalstockexchange igarashi

2 mumbaistockexchange 517380

3 madrasstockexchange cgigamoTr

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�1

vii. internationalsecurities identificationNumber(isiN) : iNe188B01013(NsDl&cDsl)

viii. marketPriceData:

monthlyhighsand lowsofmarketpricesof thecompany’ssharesonBombaystockexchange(Bse)&Nationalstockexchange(Nse)duringtheyear2010-2011:

equity priceBse nse

Month High (rs.) Low (rs.) Month High (rs.) Low (rs.)april2010 58.80 45.05 april2010 59.00 45.40may2010 54.50 43.25 may2010 54.55 43.40june2010 77.10 56.20 june2010 78.85 56.50july2010 81.55 66.70 july2010 82.15 67.10august2010 76.90 63.60 august2010 75.00 63.00september2010 90.40 64.00 september2010 91.40 66.00october2010 99.40 79.35 october2010 99.75 79.50November2010 95.90 65.40 November2010 92.50 65.00December2010 80.00 64.00 December2010 81.00 64.95january2011 74.30 71.25 january2011 74.75 68.15february2011 75.50 72.40 february2011 77.00 71.10march2011 80.00 54.40 march2011 80.00 54.00

ix. registrarandTransferagents: cameocorporateserviceslimited “subramanianBuilding” 1,clubhouseroad chennai–600002 Phone:+91-44-28460390 faxNo.:+91-44-28460129 e-mail:[email protected]

�0 �1

x. shareTransfersystem:

Thecompany’ssharesareincompulsoryDematerializationsegment.Transfersinphysicalformare registeredwithinaperiodof15days from thedateof receipt,provided thedocumentsarecompleteandthesharesundertransferarenotindispute.Thesharecertificatesdulyendorsedarebeingimmediatelydispatchedaftereffectingtransfer.Thetotalnumberofequitysharesinphysicalformtransferredduringtheyearwas2,900.

aqualifiedpracticingcompanysecretaryhascarriedoutsecretarialauditeveryquartertoreconcilethetotaladmittedcapitalwithNationalsecuritiesDepositorylimited(NsDl)andcentralDepositoryservices(india)limited(cDsl)andthetotalissuedandlistedcapital.Theauditconfirmsthatthetotalissued/paidupcapitalisinagreementwiththeaggregatetotalnumberofsharesinphysicalformandthetotalnumberofdematerializedsharesheldwithNsDlandcDsl.

xi. Distributionscheduleason31stmarch2011

category (rs.) no. of shareholders % age no. of shares % ageUpto5000 9243 89.69 1248422 6.135001–10000 585 5.67 492909 2.4210001–20000 241 2.34 381573 1.8720001–30000 75 0.73 189154 0.9330001–40000 42 0.41 151927 0.7540001–50000 40 0.39 190412 0.9350001–100000 39 0.38 286907 1.41100001&above 40 0.39 17433078 85.56Total 10305 100.00 20374382 100.00

xii. shareholdingPatternason31stmarch2011

category no. of shares % of holding

Promoters 1,28,24,225 62.94Bodiescorporate 40,20,651 19.74indianPublica) Directorsholdingb) Public

2,72,96532,56,541

1.3415.98

Total 2,03,74,382 100.00

xiii. TopTenshareholdingPatternason31stmarch2011

sl. no. category no. of shares % of holding1 agileelectricDrivesTechnologiesandholdings

Privateltd.1,28,24,225 62.94

2 igarashielectricworks(h.K)ltd. 24,99,993 12.273 igarashielectricworksltd. 9,67,648 4.754 mr.KewalKrishanNohria 2,20,000 1.085 zensecuritiesltd. 1,11,009 0.546 shreecapitalservicesltd. 68,500 0.347 mr.P.mukund 52,322 0.268 mr.jitendrakumarPhoolchandarya 47,125 0.239 mr.KewalKumarvohra 45,237 0.22

10 mr.sharadKanayalalshah 43,560 0.21

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��

xiv. Dematerializationofshares : over98%ofequityshareshavebeendematerializedup to 31 march 2011. Trading in your company’ssharesispermittedonlyinthedematerializedformaspernotificationsissuedbyseBi

xv. outstandinggDrs/aDrs/ : Notapplicable warrantsoranyconvertible instruments

xvi. Plantlocation : PlotsB-12–B–15,Phaseii mePz-sez,Tambaram, chennai-600045.

xvii. investorcorrespondence : Thecompanysecretary igarashimotorsindialtd. PlotsB-12–B–15,Phaseii mePz-sez,Tambaram, chennai-600045. PhoneNo.:+91-44-42298199 faxNo.:+91-44-22628143 e-mail:[email protected]

11. code of conduct

Thecompany’scodeofconducthasbeencompliedwithbyallthemembersoftheBoardandselectemployeesofthecompany.

The company has in place a prevention of insider Trading code based on seBi (insider Trading)regulations,1992.ThiscodeisapplicabletoallDirectorsanddesignatedemployees.Thecodeensurespreventionofdealingissharesbypersonshavingaccesstounpublishedpricesensitiveinformation.

12. Maintenance of a website

inordertoensure/enhancepublicdisseminationofallbasic informationaboutthecompany, ithasbeendecidedtomaintainafunctionalwebsitecontainingbasicinformationaboutthecompanywithdulyupdatedallstatutoryfilings.Presentlythewebsiteisunderconstruction.

13. declaration

asprovidedunder theclause49of thelistingagreementwith thestockexchanges, theBoardofDirectorsandselectemployeeshaveconfirmedcompliancewiththecodeofconduct.

forIgarashi Motors India Limited

Place: chennai p. MukundDate : july28,2011 managingDirector

�2 ��

audItor’s certIfIcate on coMpLIance of condItIons of corporate goVernance

To

Themembers

igarashimotorsindialimited,

wehaveexaminedthecomplianceofconditionsofcorporategovernancebym/sigarashimotorsindialimitedfortheyearendedon31stmarch2011,asstipulatedinclause49ofthelistingagreemententeredintobythecompanywiththestockexchanges.

Thecomplianceofconditionsofcorporategovernance is theresponsibilityof themanagement.ourexaminationwaslimited to the procedures and implementation thereof, adopted by the company for ensuring the compliance of theconditionsofcorporateguarantee.itisneitheranauditnoranexpressionofopiniononthefinancialstatementsofthecompany.

inouropinionandtothebestofourinformationandaccordingtoexplanationsgiventous,wecertifythatthecompanyhascompliedinallmaterialrespectswiththeconditionsofcorporategovernanceasstipulatedintheabove-mentionedlistingagreement.

westatethatsuchcompliance isneitheranassuranceasperthefutureviabilityof thecompanynortheefficiencyor

effectivenesswithwhichthemanagementhasconductedtheaffairsofthecompany.

forsHarp & tannan charteredaccountants icaireg.No.003792s L.VaIdyanatHanPlace : chennai PartnerDate : july28,2011 membershipNo.16368

ManagIng dIrector’s and cHIef fInancIaL offIcer’s certIfIcate on corporate goVernance

To

TheBoardofDirectors,

igarashimotorsindialimited

wehavereviewedthefinancialstatementsandthecashflowstatementsofigarashimotorsindialimited(thecompany)forthefinancialyearended31stmarch,2011andcertifythat:

a. Thesestatements,tothebestofourknowledgeandbelief:

i. donotcontainanymateriallyuntruestatementoromitanymaterialfactorcontainstatementsthatmightbemisleading;

ii. presentatrueandfairviewofthecompany’saffairsandareincompliancewithexistingaccountingstandards,applicablelawsandregulations.

b. Tothebestofourknowledgeandbelief,therearenotransactionsenteredintobythecompanyduringtheyear,whicharefraudulent,illegalorviolativeofthecompany’scodeofconduct.

c. weacceptresponsibilityforestablishingandmaintaininginternalcontrolsandhaveevaluatedtheeffectivenessofinternalcontrolsystemsofthecompanypertainingtofinancialreportingandhavedisclosedtotheauditorsandtheauditcommittee,deficienciesinthedesignoroperationofinternalcontrols,ofwhichweareawareandthestepstakenandproposedtobetakentorectifythesedeficiencies.

d. wehavealsoindicatedtotheauditorsandtheauditcommittee:

(i) significant changes in the internal controls with respect to financial reporting during the year and theachievementofadequateinternalcontrolswithinthecompany’serPsystems;

(ii) significantchangesinaccountingpoliciesduringtheyearandthesehavebeendisclosedinthenotestothefinancialstatements;

e. Tothebestofourknowledgeandbelief,therearenoinstancesofsignificantfraudinvolvingeitherthemanagementoremployeeshavingasignificantroleinthecompany’sinternalcontrolsystemswithrespecttofinancialreporting.

Place : chennai p.Mukund r.cHandrasekaranDate : july28,2011 managingDirector head-finance

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audItors’ report to tHe MeMBers of IgarasHI Motors IndIa LIMItedwehaveauditedtheattachedbalancesheetofigarashimotorsindialimited(“thecompany”)asat31stmarch2011,theprofitandlossaccountandthecashflowstatementforthefinancialyearendedonthatdateannexedthereto.Thesefinancialstatementsaretheresponsibilityofthecompany’smanagement.ourresponsibilityistoexpressanopiniononthesefinancialstatementsbasedonouraudit.

weconductedourauditinaccordancewithauditingstandardsgenerallyacceptedinindia.Thosestandardsrequire that we plan and perform the audit to obtain reasonable assurance about whether the financialstatementsarefreeofmaterialmisstatement.anauditincludesexamining,onatestbasis,evidencesupportingtheamountsanddisclosures in the financial statements.anaudit also includesassessing theaccountingprinciplesusedandsignificantestimatesmadebythemanagement,aswellasevaluatingtheoverallfinancialstatementpresentation.webelievethatourauditprovidesareasonablebasisforouropinion.

inaccordancewiththeprovisionsofsection227ofthecompaniesact,1956,wereportthat:

1. asrequiredbythecompanies(auditors’report)order,2003,issuedbythecentralgovernmentofindiaintermsofsection227(4a)ofthecompaniesact,1956,andonbasisofsuchchecksofthebooksandrecordsofthecompanyasweconsiderappropriateandaccordingtotheinformationandexplanationsgiventous,weencloseintheannexure,astatementonthemattersspecifiedinparagraphs4and5ofthesaidorder.

2. furthertoourcommentsintheannexurereferredtoabove,wereportthat:

a) wehaveobtainedalltheinformationandexplanationswhich,tothebestofourknowledgeandbelief,werenecessaryforthepurposesofouraudit;

b) inouropinion,properbooksofaccountsasrequiredbylawhavebeenkeptbythecompany,sofarasitappearsfromourexaminationofthosebooks;

c) thebalancesheet,profitand lossaccountandcashflowstatementdealtwithbythisreportare inagreementwiththebooksofaccount;

d) inouropinion,thebalancesheet,profitandlossaccountandthecashflowstatementdealtwithbythisreportcomplywiththeaccountingstandardsreferredtoinsub-section(3c)ofsection211ofthecompaniesact,1956;and

e) on the basis of the written representations received from directors of the company as at31stmarch2011,andtakenonrecordbytheBoardofDirectors,wereportthatnoneofthedirectorsisdisqualifiedason31stmarch2011frombeingappointedasadirectorintermsofclause(g)ofsub-section(1)ofsection274ofthecompaniesact,1956.

f) in our opinion, and to the best of our information and according to the explanations given to us,the said accounts, subject to Note 8(a) & 8(b) in schedule 2 regarding inter corporate loans andtransactionscoveredundersec.297ofthecompaniesact,1956respectively,readtogetherwiththesignificantaccountingpolicies inschedule1andnotesappearing inschedule2 thereon,give theinformationrequiredbythecompaniesact,1956,inthemannersorequiredandgiveatrueandfairviewinconformitywiththeaccountingprinciplesgenerallyacceptedinindia:

i) inthecaseofthebalancesheet,ofthestateofaffairsofthecompanyasat31stmarch2011;

ii) inthecaseoftheprofitandlossaccount,oftheprofitofthecompanyfortheyearendedonthatdate;

iii) inthecaseofthecashflowstatement,ofthecashflowsfortheyearendedonthatdate.

sHarp & tannancharteredaccountants

icairegistrationNo.003792s

Place: chennai L. VaidyanathanDate : may26,2011 Partner

membershipNo.16368

�4 �5

annexure to the auditors’ report

(referredtoinParagraph1ofourreportofevendate)

(i) (a) Thecompanyismaintainingproperrecordsshowingfullparticulars,includingquantitativedetailsandsituationofallfixedassets.

(b) weareinformedthatthecompanyhasphysicallyverifiedduringtheyearallitsfixedassets.Nomaterialdiscrepancieswerenoticedonsuchverification.

(c) Thecompanyhasnotdisposedoffanysubstantialpartofitsfixedassetssoastoaffectitsgoingconcernstatus.

(ii) (a) asexplainedtous,inventorieshavebeenphysicallyverifiedbythemanagementduringtheyear.inouropinion,thefrequencyofsuchverificationisreasonable.

(b) asper the informationgiven tous, theproceduresofphysicalverificationof inventory followedbythemanagementarereasonableandadequateinrelationtothesizeofthecompanyandthenatureofitsbusiness.

(c) Thecompanyismaintainingproperrecordsofinventory.Nomaterialdiscrepancieswerenoticedonphysicalverificationofinventory.

(iii) (a) Duringtheyear,thecompanyhasgrantedunsecuredloantoonecompanycoveredintheregistermaintainedundersection301ofthecompaniesact,1956.ThemaximumamountinvolvedduringtheyearwasrupeesNinecroresandthebalanceofloansgrantedtothecompanyasattheendoftheyearisrupeesNinecrores.

(b) inouropinionandaccordingtotheinformationandexplanationsgiventous,therateofinterestandother termsandconditionsfor the loanareprimafacienotprejudicial to the interestof thecompany.

(c) Thereceiptoftheprincipalamountandinteresthasbeenregular.

(d) Thereisnooverdueamountmorethanrupeesonelakhofloansgrantedtocompanies,firmsorotherpartieslistedintheregistermaintainedundersection301ofthecompaniesact,1956

(e) Duringtheyear,thecompanyhastakenunsecuredloanfromonecompanycoveredintheregistermaintainedundersection301ofthecompaniesact,1956.ThemaximumamountinvolvedduringtheyearwasrupeessixteencroresandthebalanceofloanstakenfromthecompanyasattheendoftheyearisrupeeNil.

(f) inouropinionandaccordingtotheinformationandexplanationsgiventous,therateofinterestandothertermsandconditionsfortheloantakenareprimafacienotprejudicialtotheinterestofthecompany.

(g) Therepaymentoftheprincipalamountandinteresthasbeenregular.

(iv) inouropinion,andaccordingtotheinformationandexplanationsgiventous,thereareadequateinternalcontrolsystemscommensuratewiththesizeofthecompanyandnatureofitsbusinessforthepurchaseofinventory,fixedassetsandforthesaleofgoodsandservices.further,onthebasisofourexaminationofthebooksandrecordsofthecompanyandaccordingtotheinformationandexplanationsgiventous,wehaveneithercomeacrossnorhavewebeeninformedofanycontinuingfailuretocorrectmajorweaknessesintheaforesaidinternalcontrolsystems.

�6


�7

(v) (a) accordingtotheinformationandexplanationsgiventous,weareoftheopinionthattheparticularsofcontractsorarrangementsthatneedtobeenteredintheregistermaintainedundersection301ofthecompaniesact,1956havebeensoentered.

(b) inouropinionandaccording to the informationandexplanationsgiven tous, the transactionsmadeinpursuanceofsuchcontractsorarrangementsenteredintheregistermaintainedundersection301ofthecompaniesact,1956andexceedingthevalueofrupeesfivelakhsinrespectofanypartyduringtheyear,havebeenmadeatthepriceswhicharereasonablehavingregardtoprevailingmarketpriceattherelevanttime.

(vi) Thecompanyhasnotacceptedanydepositfromthepublicwithinthemeaningofsections58a,58aaoranyotherrelevantprovisionsofthecompaniesact,1956andtherulesframedthereunder.

(vii) inouropinion,thecompanyhasaninternalauditsystemcommensuratewithitssizeandthenatureofitsbusiness.

(viii) wehavebroadly reviewed thebooksofaccountmaintainedby thecompanypursuant to the rulesprescribedby thecentralgovernment for themaintenanceof cost recordsundersection209(1)(d)ofthecompaniesact,1956inrespectofelectricalmotorsandareoftheopinionthatprimafacietheprescribedaccountsandrecordshavebeenmadeandmaintained.Thecontentsoftheseaccountsandrecordshavenotbeenexaminedbyus.

(ix) (a) accordingtotheinformationandexplanationsgiventousandonthebasisofourexaminationofthebooksofaccount,thecompanyisgenerallyregularindepositingundisputedstatutoryduesincludingProvidentfund,investoreducationandProtectionfund,employees’stateinsurance,income-tax, sales-tax, custom Duty, excise Duty, cess and any other material statutory duesduringtheyearwiththeappropriateauthorities.asat31stmarch2011,therewerenoundisputedamountspayableformorethansixmonthsfromthedatefromwhichtheybecamepayable.

(b) accordingtotheinformationandexplanationgiventousandtherecordsofthecompanyexaminedbyus,theparticularsofincometaxasat31stmarch2011whichhasnotbeendepositedonaccountofdisputependingisasunder:

rs.inlakhs

Nameofthestatue

NatureofdisputedduesTotal

Demandamountnotdeposited

Periodtowhichthedispute

relates

forumwheredisputesare

pending

incomeTaxact,

1961

re-computationofsection10(a)exemption

0.05 0.05 assessmentYear2003-04

commissioner(appeals)

incomeTaxact,

1961

DisallowanceofBroughtforwardlosses(amountdepositedrs.58.31lakhs)

64.31 6.00 assessmentYear2004-05

commissioner(appeals)

TherearenoduesofcustomsDuty,exciseDuty,salestaxandcess,whichhavenotbeendepositedonaccountofanydispute.

�6 �7

(x) Thecompany’saccumulatedlossesattheendofthefinancialyeararelessthanfiftypercentofitsnet-worthandithasnotincurredcashlossesinthecurrentfinancialyearandintheimmediatelyprecedingfinancialyear.

(xi) accordingtotherecordsofthecompanyexaminedbyusandtheinformationandexplanationsgiventous,thecompanyhasnotdefaultedinrepaymentofduestoanybankorfinancialinstitutionduringtheyear.Thecompanyhasnotissuedanydebentures.

(xii) according to the informationandexplanationsgiven tous, thecompanyhasnotgranted loansandadvancesonthebasisofsecuritybywayofpledgeofshares,debenturesandothersecurities.

(xiii) Theprovisionsofanyspecialstatuteapplicabletochitfund/nidhi/mutualbenefitfund/societiesarenotapplicabletothecompany.

(xiv) inouropinionandaccording to the informationandexplanationsgiven tous, thecompany isnotadealerortraderinshares,securities,debenturesandothersecurities.

(xv) inouropinionandaccordingtotheinformationandexplanationsgiventous,thetermsandconditionsofguaranteesgivenbythecompanyforloanstakenbyothersfrombanksorfinancialinstitutionsarenotprimafacieprejudicialtotheinterestofthecompany.

(xvi) inouropinionandaccordingtotheinformationandexplanationsgiventous,onanoverallbasis,thetermloanshavebeenappliedforthepurposeforwhichtheywereobtained.

(xvii) inouropinionandaccordingtotheinformationandexplanationsgiventousandonanoverallexaminationoftheBalancesheetofthecompany,wereportthatnofundsraisedonshorttermbasishavebeenusedforlongterminvestments.

(xviii) Thecompanyhasmadepreferentialallotmentofsharestoapartycoveredintheregistermaintainedundersection301of thecompaniesact,1956during theyear. inouropinionandaccording to theinformationandexplanationsgiventous,wereportthatthepriceatwhichtheshareshavebeenissuedarenotprejudicialtotheinterestofthecompany.

(xix) Thecompanyhasnotissuedanydebenturesduringtheyearandaccordingly,nosecurityorchargeneedstobecreated.

(xx) Thecompanyhasnotraisedanymoneybypublicissuesduringtheyear.

(xxi) During the course of our examination of the books and the records of the company, carried out inaccordancewith thegenerallyacceptedauditingpractices in india,andaccording to the informationandexplanationsgiventous,wehaveneithercomeacrossanyinstancesofmaterialfraudonorbythecompany,noticedor reportedduring theyear,norhavewebeen informedofsuchcaseby themanagement.

sHarp & tannan

charteredaccountantsicairegistrationNo.003792s

Place: chennai L. Vaidyanathan

Date : may26,2011 PartnermembershipNo.16368

�8


�9

BaLance sHeet as at MarcH 31, 2011schedule as at asat

31.03.2011 31.03.2010rupees rupees rupees rupees

sources of fundsshareholders’ funds

sharecapital a 203,743,820 138,743,820reservesandsurplus B 814,344,940 383,394,940

1,018,088,760 522,138,760employeestockoptionsoutstanding 20,197,500 -less:Deferredemployeecompensationexpenses 12,007,829 -

8,189,671 -Loan funds

securedloans c 578,235,421 691,721,447Unsecuredloans d 29,811,851 11,000,000

608,047,272 702,721,447deferred tax liability 88,692,669 93,394,360(referNoteNo.22inschedule2)

1,723,018,372 1,318,254,567appLIcatIon of fundsfixed assets

tangible assets e(i)grossblock 1,291,075,590 1,165,039,613less:Depreciation 448,839,221 367,995,106Netblock 842,236,369 797,044,507capitalwork-in-progress 18,704,977 12,504,243

860,941,346 809,548,750Intangible assets e(ii)

grossblock 53,429,466 54,983,299less:amortisationandobsolescence 39,779,112 33,197,559Netblock 13,650,354 21,785,740capitalwork-in-progress 10,112,867 25,628,356

23,763,221 47,414,096Investments f 286,164,900 143,300,000deferred tax asset 1,190,759 723,889(referNoteNo.22inschedule2)current assets, Loans and advances g

inventories 182,250,055 136,488,697sundrydebtors 300,562,188 227,074,809cashandbankbalances 55,247,043 30,177,810loansandadvances 339,637,986 168,727,833

877,697,272 562,469,149Less: current Liabilities and provisions H

currentliabilities 508,464,374 505,788,942Provisions 10,762,144 7,735,283

519,226,518 513,524,225Netcurrentassets 358,470,754 48,944,924Profitandlossaccount 192,487,392 268,322,908

1,723,018,372 1,318,254,567significantaccountingpolicies 1Notesonaccounts 2

TheschedulesreferredtoaboveformanintegralpartoftheBalancesheet.

asperourreportattached P. Mukund k.k. nohria k. igarashisharP & Tannan managingDirector chairman C.P. dusad charteredaccountants g.n. Mani icairegistrationNo.003792s T. igarashi r. Chandrasekaran T.s. Maharani keiiChi igarashiL. VaidyanaThan head-finance companysecretary Directors Partner membershipNo.16992 membershipNo.16368 Place : chennai Date : may26,2011

�8 �9

profIt and Loss account for tHe year ended MarcH 31, 2011

schedule 2010-2011 2009-2010

rupees rupees

IncoMe

sales I 1,972,123,795 1,587,054,895

otherincome J 4,083,680 5,423,383

1,976,207,475 1,592,478,278

eXpendIture

materials,manufacturingandTradingexpenses k 1,534,039,668 1,261,949,468

staffexpenses L 87,501,925 72,097,612

sellingandadministrationexpenses M 78,290,964 70,885,799

interestandcommitmentcharges n 100,381,774 85,115,344

Depreciation,amortisationandobsolescence o 105,326,189 64,805,066

1,905,540,520 1,554,853,289

Profitbeforetax 70,666,955 37,624,989

tax expense

DeferredTax(referNoteNo.22inschedule2) (5,168,561) 10,350,342

Profitaftertax 75,835,516 27,274,647

add:Balancebroughtforwardfrompreviousyear (268,322,908) (295,597,555)

BalancecarriedtoBalancesheet (192,487,392) (268,322,908)

BasicearningsPershare 5.04 1.97

DilutedearningsPershare(referNoteNo.21inschedule2)

4.92 1.97

facevaluePerequityshare 10.00 10.00

significantaccountingpolicies 1Notesonaccounts 2

TheschedulesreferredtoaboveformanintegralpartoftheProfit&lossaccount.

asperourreportattached P. Mukund k.k. nohria k. igarashisharP & Tannan managingDirector chairman C.P. dusad charteredaccountants g.n. Mani icairegistrationNo.003792s T. igarashi r. Chandrasekaran T.s. Maharani keiiChi igarashiL. VaidyanaThan head-finance companysecretary Directors Partner membershipNo.16992 membershipNo.16368 Place : chennai Date : may26,2011

40


41

scHeduLes forMIng part of accounts

as at asat31.03.2011 31.03.2010

rupees rupeesscHeduLe ashare capitalauthorised capital :

22,000,000equitysharesofrs10/-each 220,000,000 220,000,000(Previousyear22,000,000equitysharesofrs.10/-each)

Issued, subscribed and paid up:

20,374,382equitysharesofrs10/-eachfullypaidup 203,743,820 138,743,820(Previousyear13,874,382sharesofrs.10/-eachfullypaidup)(outoftheabove12,824,225equitysharesofrs.10/-eachareheldbytheholdingcompany-agileelectricDrivesTechnologiesandholdingsPrivatelimited.)(referNoteNo.25(a)inschedule2)

scHeduLe B

reserves and surplussecuritiespremiumaccountasperlastBalancesheet 383,394,940 383,394,940additionduringtheyear 430,950,000 -(referNoteNo.25(a)inschedule2) 814,344,940 383,394,940

scHeduLe csecured Loans:frombanks

(i) Termloan 151,815,411 192,017,632(ii) (a)workingcapitalTermloan 304,397,055 350,479,486 (b)workingcapitalloan(Packingcredit/Buyerscredit) 120,514,563 149,224,329(iii) vehicleloan 1,508,392 - (i) Termloansfrombanksaresecuredbyfirstchargeonfixed

assetsofthecompany,presentandfuture (ii) (a) & (b) working capital Term loan and working

capital loans from banks are secured by charge onall current assets of the company, present and futureand by second charge over residual value of movablefixed assets of the company after term loan. Thecharge also extends to bills discounted amounting tors.83,406,368/-(Previousyearrs.104,376,085/-)

(iii) vehicleloanissecuredbythehypothecationoftherelatedvehicles

578,235,421 691,721,447

scHeduLe dunsecured Loans:TermloanfromBanks - 11,000,000leasefinance 29,811,851 -(referNoteNo.18(a)inschedule2) 29,811,851 11,000,000

40 41

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42


4�


as at asat

31.03.2011 31.03.2010

rupees rupees

scHeduLe f

InVestMents(atcostunlessotherwisespecified):

longTerm,UnquotedTradeinvestments

fullypaidequitysharesofothercompanies:

(a)ijTPlastics&ToolsPrivatelimited - 74,300,000

(7,430,000equitysharesofrs.10/-each)

(referNoteNo.26(a)inschedule2)

(b)agileelectricsubassemblyPrivatelimited 74,300,000 -

(2,451,900equitysharesofrs.10/-each)


fullypaidequitysharesinassociate:

BoschelectricalDrivesindiaPrivatelimited 211,864,900 69,000,000

(21,18,649equitysharesofrs.100/-each,fullypaidup)

(14,28,649equitysharesofrs.100/-eachsubscribed

duringtheyear)

(referNoteNo.26(c)inschedule2)

Total 286,164,900 143,300,000

42 4�


as at asat31.03.2011 31.03.2010

rupees rupees rupees rupees

scHeduLe g

current assets, Loans and advances

Inventories :

(atlowerofcostandnetrealisablevalue)

rawmaterialsandcomponents 140,258,746 91,652,652

storesandspares 21,493,320 24,710,970

work-in-progress 15,436,327 12,524,196

finishedgoods 5,061,662 7,600,879 182,250,055 136,488,697

sundry debtors:

unsecured

Debtsoutstandingformorethansixmonths

consideredgood 2,589,789 3,895,095

otherdebts

consideredgood 297,972,399 223,179,714 300,562,188 227,074,809

cash and bank balances :

cash-on-hand - -

Balancewithscheduledbanks:

oncurrentaccount 27,484,011 12,626,341

ondepositaccounts{includinginterestaccruedthereonrs.436,039/-(previousyearrs.253,535/-)}

27,763,032 17,551,469

(referNoteNo.7inschedule2) 55,247,043 30,177,810

Loans and advances

unsecured, considered good:

inter-corporatedeposit 90,078,904 -

(includinginterestaccuredthereonrs.78,904/-)


advancesrecoverableincashorinkind 248,484,398 167,543,091

orforvaluetobereceived

Balancewithcustomsandexcise 1,074,684 1,184,742

339,637,986 168,727,833

877,697,272 562,469,149

44


45


as at asat31.03.2011 31.03.2010

rupees rupees rupees rupeesscHeduLe Hcurrent Liabilities and provisionsLiabilities :sundrycreditors

Duetomicroandsmallenterprises - -Unpaiddividend 1,072,552 1,419,313interestaccruedbutnotdueonloans 376,548 165,123advancereceivedfromcustomers 107,132,791 -Duetofellowsubsidiary 49,865,004 13,600,881otherthanmicroandsmallenterprises 350,017,479 490,603,625

508,464,374 505,788,942

provisions for :Taxes(earlieryears) 7,735,283 7,735,283gratuity(referNoteNo.24inschedule2)

3,026,861 -

leaveencashment(referNoteNo.24inschedule2)

- -

10,762,144 7,735,283519,226,518 513,524,225

2010 - 2011 2009-2010rupees rupees rupees rupees

scHeduLe Isales

manufacturingsales(gross)exports 1,854,896,377 1,393,446,593Domestic 7,405,422 52,634,502less:exciseDuty 1,179,385 7,718,580

6,226,037 44,915,922manufacturingsales(Net) 1,861,122,414 1,438,362,515Tradingsales-Deemedexports 111,001,381 148,692,380

1,972,123,795 1,587,054,895

scHeduLe Jother Income

interestincome 1,487,604 296,478(Taxdeductedatsourcers.150,360/-previousyearrs.50,707/-)Profitonsaleoffixedassets 186,551 644,241serviceincome - 2,250,000scrapsales-otherthanmanufacturingrelated 2,409,525 2,232,664

4,083,680 5,423,383

44 45

scHeduLes forMIng part of accounts2010 - 2011 2009-2010


scHeduLe k

Material, Manufacturing and trading expenses

raw materials and components consumed:

openingstock 91,652,652 88,671,336

add:Purchases 1,299,519,832 968,117,754

1,391,172,484 1,056,789,090

less:closingstock 140,258,746 91,652,6521,250,913,738 965,136,438

less:scrapsales 27,171,958 19,710,197

1,223,741,780 945,426,241

add: (Increase) / decrease in manufactured stocks:

closingstock:

finishedgoods 5,061,662 7,600,879

work-in-progress 15,436,327 12,524,19620,497,989 20,125,075

less:openingstock:

finishedgoods 7,600,879 25,274,818

work-in-progress 12,524,196 16,263,45720,125,075 41,538,275

(372,914) 21,413,200

1,223,368,866 966,839,441

Purchaseoftradinggoods 108,370,817 146,554,737stores and spares:

openingstock 24,710,970 28,889,003

add:Purchases 55,187,152 46,213,533

79,898,122 75,102,536

less:closingstock 21,493,320 24,710,97058,404,802 50,391,566

Directexpenses 84,441,439 56,516,037

Powerandfuel 27,103,036 18,681,747

repairsto

Plant&machinery 29,514,172 21,660,248

Building 2,836,536 1,305,69232,350,708 22,965,940

1,534,039,668 1,261,949,468

46


47


2010 - 2011 2009-2010rupees rupees

scHeduLe L

staff expenses

salaries,wagesandbonus 64,677,592 52,330,854

contributiontoProvidentfund,gratuityfundand 5,865,861 3,034,451

leaveencashment

welfareandotherexpenses 16,958,472 16,732,30787,501,925 72,097,612

scHeduLe M

selling and administration expenses

rent 2,561,099 3,444,847

rates,taxesandfees 2,212,575 1,391,359

insurance 4,756,687 3,242,995

Travelandconveyance 18,879,523 13,001,911

Telephone,postageandtelegrams 1,889,360 2,054,609

recruitmentandtraining 314,775 612,855

Printingandstationery 2,169,448 1,823,390

Professionalcharges 7,230,996 7,143,010

sellingandforwardingexpenses 7,173,912 11,622,824

repairsandmaintenance-others 7,952,195 8,271,579

Bankcharges 18,033,095 11,683,408

miscellaneousexpenses 5,117,299 6,593,01278,290,964 70,885,799

scHeduLe n

Interest and commitment charges

onfixedloans 41,543,658 37,055,502

onworkingcapitalloans 46,001,634 39,952,608

others 12,836,482 8,107,234100,381,774 85,115,344

scHeduLe o

depreciation, amortisation and obsolescence

Depreciation 86,854,277 54,147,172

amortisation 10,599,634 10,657,894

obsolescence 7,872,278 -

(referNoteNo.27(b)inschedule2)105,326,189 64,805,066

46 47

scHeduLes forMIng part of accountsscHeduLe 1sIgnIfIcant accountIng poLIcIes1. BasIs of presentatIon The accounts have been prepared under the historical cost convention and on the basis of going

concern,withrevenuesrecognizedandexpensesaccountedonaccrualbasis,includingforcommittedobligationsandisinaccordancewiththeprovisionsofthecompaniesact,1956andtheaccountingstandardsasspecifiedinthecompanies(accountingstandards)rules,2006prescribedbythecentralgovernment.insuranceandotherclaimsareaccountedforasandwhenadmittedbytheappropriateauthorities.

ThepreparationoffinancialstatementsinconformitywithgaaPrequiresthatthemanagementofthecompanymakesestimatesandassumptionsthataffectthereportedamountsofincomeandexpensesoftheperiod,thereportedbalancesofassetsandliabilitiesandthedisclosuresrelatingtocontingentliabilitiesasofthedateofthefinancialstatements.examplesofsuchestimatesincludetheusefullivesof tangibleand intangible fixedassets,provision fordoubtfuldebts /advances, futureobligations inrespectofretirementbenefitplans,etc.Difference,ifany,betweentheactualresultsandestimatesisrecognizedintheperiodinwhichtheresultsareknown.

2. reVenue recognItIon revenueisrecognizedbasedonnatureofactivitywhenconsiderationcanbereliablymeasuredand

thereexistsreasonablecertaintyofitsrecovery.

a) revenuefromsaleofproductsisrecognisedwhenallthesignificantrisksandrewardsofownershipof the products are passed on to the customers, which is generally on dispatch of goods andacceptance.sales includeexcisedutyandadjustmentsmadetowards liquidateddamagesandpricevariation,whereverapplicable.salesexcludevalueadded tax /sales tax,brokerageandcommission.

b) interestincomeisaccruedatapplicableinterestrates.

c) otheritemsofincomeareaccountedasandwhentherighttoreceivearises.

3. fIXed assets fixed assets are stated at original cost net of tax/ duty credits availed, if any, less accumulated

depreciation,accumulatedamortisationandcumulativeimpairment.

administrativeandothergeneraloverheadexpensesthatarespecificallyattributabletoacquisitionoffixedassetsorbringingfixedassetstoworkingconditionareallocatedandcapitalizedaspartofcostofthefixedassets.

4. IMpaIrMent as at each Balance sheet date, the carrying amount of asset is tested for impairment so as to

determine: a) theprovisionforimpairmentloss,ifany;and

b) thereversalofimpairmentlossrecognizedinpreviousperiods,ifanyimpairmentlossisrecognizedwhenthecarryingamountofanassetexceedsitsrecoverableamount.

5. InVentorIes inventoriesarevaluedafterprovidingforobsolescenceasunder:

rawmaterialsandcomponents : atlowerofweightedaveragecostandnetrealizablevalue.

Packingmaterialsandspares : atlowerofweightedaveragecostandnetrealizablevalue.

work-in-progress : at lower of material cost including appropriate productionoverheadsandnetrealisablevalue.

finishedgoods : atlowerofweightedaveragecostorNetrealizablevalue.costincludesrelatedoverheads

48


49

6. foreIgn currency transactIons foreigncurrencytransactionsrelatingtopurchaseandsaleofgoodsarerecordedattheexchangerate

prevailingatthetimeoftransaction.foreigncurrencyassetsandliabilitiesareconvertedattheyear-endrate.exchangedifferencesareadjustedintheprofitandlossaccount.

7. eMpLoyee BenefIts

a) shorttermemployeebenefits:

allemployeebenefitsfallingduewhollywithintwelvemonthsofrenderingtheserviceareclassifiedas short term employee benefits. The benefits like salaries, wages, short term compensatedabsencesetc.andtheexpectedcostofbonus,ex-gratia,arerecognizedintheperiodinwhichtheemployeerenderstherelatedservice.

b) Post-employmentbenefits:

i. Definedcontributionplans:Thecompany’sstategovernedprovidentfundscheme,employeestateinsuranceschemeandemployeepensionschemearedefinedcontributionplans.Thecontributionpaid/payableunder the schemes is recognizedduring theperiod inwhich theemployeerenderstherelatedservice.

ii. Definedbenefitplans:Thecompany’sobligationtowardsgratuity isadefinedbenefitplan.ThepresentvalueoftheobligationundersuchdefinedbenefitplanisdeterminedbasedonactuarialvaluationusingtheProjectedunitcreditmethod,whichrecognizeseachperiodofserviceasgivingrisetoadditionalunitofemployeebenefitentitlementandmeasureseachunitseparatelytobuildupthefinalobligation.Theobligationismeasuredatthepresentvalueof theestimated futurecash flows.actuarialgainsand lossesare recognized immediatelyintheProfitandlossaccount,andgainsorlossesonthecurtailmentorsettlementofanydefinedbenefitplanarerecognizedwhenthecurtailmentorsettlementoccurs.

c) longtermemployeebenefits:

The obligation for long term employee benefits such as long term compensated absences isrecognizedinthesimilarmannerasinthecaseofdefinedbenefitplansasmentionedin(b)(ii)above.

8. eMpLoyee stock optIon scHeMe

inrespectofstockoptionsgrantedpursuanttothecompany’sstockoptionschemes,theintrinsicvalueoftheoptions(excessofmarketpriceoftheshareovertheexercisepriceoftheoption),istreatedasdiscountandaccountedasemployeecompensationcostoverthevestingperiod.

9. deprecIatIon

DepreciationonassetsincludingbuildingconstructedonleasedlandisprovidedonstraightlinemethodattheratesandinthemannerspecifiedinscheduleXivofthecompaniesact,1956,exceptinrespectoftools&welfareassetsusedbytheemployees,whicharebeingdepreciatedattherateof20%onstraight-linemethod.assetscostinglessthanrs.5,000/-aredepreciatedfullyintheyearofpurchase.

Depreciation on impaired assets is provided by adjusting the depreciation charge in the remainingperiodssoastoallocatetheasset’srevisedcarryingamountoveritsremainingusefullife.

10. taXes on IncoMe

TaxonincomeforthecurrentperiodisdeterminedonthebasisoftaxableincomecomputedinaccordancewiththeprovisionsoftheincomeTaxact,1961.

Deferredtaxisrecognizedontimingdifferencesbetweentheaccountingincomeandtaxableincomefortheyearandquantifiedusingthetaxratesandlawsenactedorsubstantivelyenactedasonthebalancesheetdate.


48 49

Deferred taxassets relating tounabsorbeddepreciation/business lossesare recognizedandcarriedforward to the extent there is virtual certainty that sufficient future taxable income will be availableagainstwhichsuchdeferredtaxassetscanberealized.

otherdeferredtaxassetsarerecognizedandcarriedforwardtotheextentthatthereisareasonablecertaintythatsufficientfuturetaxableincomewillbeavailableagainstwhichsuchdeferredtaxassetscanberealized.

11. IntangIBLe assets and aMortIsatIon

intangibleassetisrecognizedwhenitisprobablethatfutureeconomicbenefitsthatareattributabletotheassetwillflowtotheenterpriseandthecostoftheassetcanbemeasuredreliably.

Product Development expenses on new products are capitalized under ‘intangible assets’ and areamortizedoveraperiodof60monthsfromthedateofcommencementofcommercialproduction.

amortisationon impairedassets isadjusted in the futureperiods insuchamanner that the revisedcarryingamountoftheassetisallocatedoveritsremainingusefullife.

12. Leases

a) financeleases

assetsacquiredunderleaseswherethecompanyhassubstantiallyall thesignificantrisksandrewardsofownershipareclassifiedasfinanceleases.suchassetsarecapitalizedattheinceptionoftheleaseatthelowerofthefairvalueorthepresentvalueofminimumleasepaymentsandaliabilityiscreatedforanequivalentamount.eachleaserentalpaidisallocatedbetweentheliabilityandtheinterestcost,soastoobtainaconstantperiodicrateofinterestontheoutstandingliabilityforeachperiod.

b) operatingleases

assetsacquiredonleaseswhereasignificantportionoftherisksandrewardsofownershipareretainedbythelessorareclassifiedasoperatingleases.leaserentalsarechargedtoProfitandlossaccountonaccrualbasis.

13. InVestMents

long-terminvestmentsarecarriedatcost,afterprovidingforanydiminutioninvalue,ifsuchdiminutionisofotherthantemporaryinnature.

currentinvestmentsarecarriedatlowerofcostormarketvalue.Thedeterminationofcarryingvalueofsuchinvestmentsisdoneonthebasisofspecificidentification.

14. proVIsIons, contIngent LIaBILItIes and contIngent assets Provisionsare recognized for liabilities that canbemeasuredonlybyusingasubstantialdegreeof

estimation,if

(a) thecompanyhasapresentobligationasaresultofapastevent,

(b) aprobableoutflowofresourcesisexpectedtosettletheobligationand

(c) theamountofobligationcanbereliablyestimated.

reimbursementexpected in respectofexpenditure required tosettleaprovision is recognizedonlywhenitisvirtuallycertainthatthereimbursementwillbereceived.

contingentliabilityisdisclosedinthecaseof

(a) presentobligationarisingfromapastevent,whenitisnotprobablethatanoutflowofresourceswillberequiredtosettletheobligation

(b) apossibleobligation,unlesstheprobabilityofoutflowofresourcesisremote.

contingentassetsareneitherrecognized,nordisclosed.

Provisions,contingentliabilitiesandcontingentassetsarereviewedateachbalancesheetdate.


50


51

scHeduLe 2

notes forMIng part of accounts

as at asat

31.03.2011 31.03.2010

(rupees) (rupees)

1. estimatedamountofcontracts remaining tobeexecutedoncapitalaccountnetofadvancesofrs.17,816,291(Previousyearrs.Nil) 140,705,846 1,451,981

2. contingentliabilities:

a)Billsdiscounted 83,406,368 104,376,085

b)incomeTaxliabilitythatmayariseinrespectofmattersonappeal 10,164,183 8,360,134

c)guaranteesgivenonbehalfoffellowsubsidiarycompany 409,244,243 348,001,343

d)esiDemandonduesfortrainees 2,434,404 -

2010-11 2009-10 (rupees) (rupees)

3. auditor’sremunerationandexpenseschargedtotheaccounts:

auditfees 600,000 450,000

Taxauditfees 50,000 50,000

certification 82,000 71,000

expensesreimbursed 23,541 11,533

4. valueofimports(onc.i.f.basis):

rawmaterial(includessezpurchasesofrs.3,629,557previousyearrs.24,950,875) 195,526,470 148,336,802

components,stores&spares(includessezpurchaseofrs.248,001,793previousyearrs.235,971,970) 984,088,128 808,809,397

capitalgoods(includessezpurchaseofrs.92,138,617previousyearrs.16,960,319) 117,034,438 17,972,833

5. expenditureinforeigncurrency

foreigntravel 1,181,438 1,094,988

sub-contractcharges 646,956 400,296

freightcharges - 1,109,456

6. earningsinforeigncurrency:

foBvalueofexports* 1,850,435,327 1,541,955,734

*includesDeemedexportsofrs.209,482,100(Previousyear312,899,156)

50 51

scHeduLe 2


7. Deposit accounts with banks under cash and bank balances in schedule g includes margin moneydepositofrs.26,065,340/-(previousyearrs.15,882,115/-),fixeddepositofrs.12,07,183/-(previousyearrs.11,33,747/-)andrs.6,021/-(previousyearrs.6,021/-)pledgedassecuritywithsalestaxdepartment.

8. (a). inrespectofintercorporatedepositofrs.900,00,000thecompanyhasnotobtainedpriorapprovalofthecentralgovernmentasrequiredundersection295ofthecompaniesact,1956.Thecompanyistakingnecessarystepstoregularisethematterandapplicationisalsobeingmadetothecentralgovernment.

(b). Thecompanyhasnotobtainedpriorapprovalofthecentralgovernmentfortransactionsenteredintowithanothercompanycoveredundersec.297ofthecompaniesact,1956.Thecompanyistakingnecessarystepstoregularisethematterandapplicationisalsobeingmadetothecentralgovernment.

9. Detailsoflicensedandinstalledcapacities,production,stocksandturnover

unitselectric Micro Motor others

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

licensedcapacity Nos na Na na Na

installedcapacity Nos 13,000,000 9,000,000 - -

Production Nos 11,419,701 7,854,211 13,914,226 11,190,807

openingstock Nos 182,027 356,247 470 1,580

rupees 7,462,147 25,156,400 138,732 118,418

closingstock Nos 188,255 182,027 1,422 470

rupees 4,994,648 7,462,147 67,014 138,732

Turnover Nos 11,413,473 8,028,431 13,913,274 11,191,917

rupees 1,645,511,345 1,228,574,733 215,611,069 209,787,783

others:TurnoverincludessaleofDrawnparts,subassemblyandactuators.

10 DetailsofTradingpurchase,Turnoverfor2010-11. amountinrs.

particularsopening

stockpurchases

closingstock

turnover

2010-11

rawmaterial/components/Parts nil 108,370,817 nil 111,001,381

total 108,370,817 111,001,381

2009-10

rawmaterial/components/Parts Nil 146,554,737 Nil 148,692,380

Total 146,554,737 148,692,380

52


5�

12. Directorsremuneration 2010-11 2009-10(rupees) (rupees)

computationofnetprofitsinaccordancewithsection349ofthecompaniesact,1956.

Profit/(loss)asperProfit&lossaccount 70,666,955 37,624,989

add:Depreciationchargedinaccounts 105,326,189 64,805,066

Directorsemoluments

managingDirector 7,104,585 3,833,465

sittingfees 85,000 70,000

112,515,774 68,708,531

183,182,729 106,333,520

less:Depreciationinaccordancewithsection350ofthecompaniesact,1956

105,326,189 64,805,066

Profitonsaleoffixedasset 186,551 369,402

105,512,740 65,174,468

NetProfit/(loss)aspersection349 77,669,989 41,159,052

maximum permissible remuneration payableper annum as per section 309 of thecompaniesact,1956

3,883,499 2,057,953

inviewofinadequacyofprofits,remunerationpayabletomanagingDirectorforfinancialyear2010-11isbasedontheeffectivecapitalmethodasperscheduleXiiiofthecompaniesact,1956.

scHeduLe 2


11. (a)rawmaterialsandcomponentsconsumed

particulars Unit2010-2011 2009-2010

Quantity Value (rs) Quantity value(rs)

ferrous Kgs 3,829,058 178,238,557 2,881,443 124,287,249

Non-ferrous Kgs 246,193 84,449,975 131,843 49,511,632

others - 961,053,248 - 771,627,360

Total 1,223,741,780 945,426,241

(b)analysisofrawmaterialsandcomponentsconsumed

particulars2010-2011 2009-2010

% of totalconsumption

Value(rs.)

%oftotalconsumption

value(rs.)

imported 87% 1,065,363,645 89% 837,764,399

indigenous 13% 158,378,135 11% 107,661,842

Total 100% 1,223,741,780 100% 945,426,241

52 5�

13 remunerationtomanagingDirector: 2010-11 2009-10 (rupees) (rupees)

salaries 4,800,000 2,400,000PerquisitesandBenefits 2,304,585 1,433,465

7,104,585 3,833,465

scHeduLe 2

notes forMIng part of accountsas at

31.03.2011(rupees)

asat31.03.2010(rupees)effective capital Working

sharecapital&freereserve 825,601,368 253,815,852(excludingrevaluationreserve)longTermloans&Depositspayable(excludingworkingcapitalloans)

486,024,317 553,497,118

subTotal 1,311,625,685 807,312,970less:aggregateofinvestmentinshares 286,164,900 143,300,000effectivecapital 1,025,460,785 664,012,970

maximum permissible remuneration payableperannumasperscheduleXiiiundereffectivecapitalmethod.

4,800,000 4,800,000

remunerationtomanagingDirector 7,104,585 3,833,465

Note:ThecompanyhasappliedtothecentralgovernmentforapprovalofadditionalremunerationtothemanagingDirector.Pendingapprovalfromcentralgovernment,thecompanyhasnotpaidadditionalremunerationtothemanagingDirector.(referNoteNo.28inschedule2)

14. Thecompanydoesnothaveanytransactionwithmicroandsmallenterprisescoveredunderthemicro,smallandmediumenterprisesDevelopmentact,2006,identifiedonthebasisofinformationavailablewiththecompany.

15. segmentreporting:(i)Thecompanyisengagedinsinglesegmentofproductionofmicromotorsanditsaccessoriesmainlyfor the automotive sector. hence disclosure of primary segment under accounting standard (as)17-”segmentreporting”doesnotarise.Thedetailsofsecondarysegmentbeing“geographicalsegment”aregivenbelow.

segment2010 - 11rupees

2009-10rupees

overseas 1,646,019,166 1,229,074,817

Domestic 326,104,629 357,980,078total revenue 1,972,123,795 1,587,054,895

(ii) segmentidentification,reportablesegmentsanddefinitionofeachreportablesegment (a) secondarysegmentreportingformat in respectofsecondarysegment information, thecompanyhas identified itsgeographical

segmentsas(a)Domesticand(b)overseas.Thesecondarysegmentinformationhasbeendisclosedaccordingly

(b) reportablesegments reportablesegmentshavebeenidentifiedasperthecriteriaspecifiedinaccountingstandard

(as)17-“segmentreporting”(iii) alltangibleassetsofthecompanyarelocatedwithinindia.

54


55

16. relatedpartydisclosures: (i) Thefollowingenterprisesarerelatedtothecompany.

1. hBlPowersystemsltd. - Ultimateholdingcompanyfrom31.03.2011

2.igarashielectricworksltd,japan - holdingcompanytill24.01.2011 (throughmanagementcontrol) - significantshareholderfrom 25.01.2011to30.03.2011

3.igarashielectricworks(hK)ltd. - fellowsubsidiarycompanytill24.01.2011

4.igarashimotorsalesllc,Usa - fellowsubsidiarycompanytill24.01.2011

5.igarashimotorengmBh - fellowsubsidiarycompanytill24.01.2011

6.agileelectricDrivesTechnologies andholdingsPvt.ltd. - fellowsubsidiarycompanytill24.01.2011 - significantshareholderfrom 25.01.2011to30.03.2011 - holdingcompanyfrom31.03.2011

7.agileelectricsubassemblyPvt.ltd. - associatecompanytill30.03.2011 - fellowsubsidiarycompanyfrom31.03.2011

8. BoschelectricalDrivesindiaPvt.ltd. - associatecompanyfrom03.01.2011

(ii) KeymanagementPersonnel(KmP):

mr.P.mukund - managingDirector.

(iii)Thefollowingtransactionswerecarriedoutwiththerelatedpartiesintheordinarycourseofbusiness.amountinrs.

sl.No.

Natureofrelationship/transaction

holdingcompany

fellowsubsidiary

associatesother

relatedParties

Total

1 Purchaseofgoods 17,518,609 313,929,413 - 7,700,657 339,148,679(76,138,888) (48,022,828) (235,163,984) - (359,325,700)

2 saleofgoods - 1,658,712,262 - - 1,658,712,262(55,496) (1,245,341,626) (328,384,179) - (1,573,781,300)

3 otherservicesreceived 2,700,000 - - - 2,700,000- - (3,323,691) - (3,323,691)

4 Purchaseoffixedassets - 27,609,000 - - 27,609,000- - - - -

5 saleoffixedassets - 5,214,600 - - 5,214,600- - - - -

6 intercorporatedepositsgiven - - - 90,000,000 90,000,000- - - - -

7 intercorporatedepositstaken - 160,000,000 - - 160,000,000- - - - -

8saleofproductline/programme

- 2,840,537 - - 2,840,537

- - - - -9 interestincome - - - 78,904 78,904

- - - - -10 interestexpense - 1,821,261 - - 1,821,261

- (669,699) - - (669,699)

scHeduLe 2


54 55

scHeduLe 2


(iv)amountDueto/fromrelatedParties

amountinrs.

slno.

Natureofrelationship/transaction

holdingco.fellow

subsidiaryassociates

otherrelatedParties

Total

1 DuesfromrelatedParties - 303,586,835 - - 303,586,835

(2,591,392) (371,830,771) (256,122,029) - (630,544,191)

2 DuestorelatedParties - 49,865,004 - - 49,865,004

(53,655,453) (13,600,881) (96,028,204) - (163,284,537)

3 intercorporatedepositsreceivable 90,078,904 - - - 90,078,904

- - - - -

(Note:figuresinbracketsrepresentcorrespondingamountsofthepreviousyear.)

(v) Noamountoutstandinghasbeenwrittenofforwrittenbackduringtheyear.

17. factorybuildinghasbeenconstructedonlandtakenonleasefrom1stmay1991foraperiodoffifteenyears from madras export Processing zone (mePz) and monthly rent paid has been charged in theaccounts.Thesaidleasehassincebeenrenewedforafurtherperiodoffiveyearsw.e.f2ndmay2006andisrenewablefurtherthereafterattheoptionofthecompanyonmutuallyagreedtermswithmePz.in theeventof thecompanydeciding tovacate thepremises, the lessor(mePz)willcompensate thecompanyamutuallyagreedconsiderationforthesaleofthefactorybuilding.accordinglydepreciationhasbeenprovidedattheratesprescribedinscheduleXivofthecompaniesact,1956.

18. leases:

(a) financelease

i) Duringtheyear,thecompanyhasacquiredcertainplant&machineryonfinancelease.Theleaseishavingaprimaryperiodwhichisfixedandnoncancellable.Therearenoexceptional/restrictivecovenantsintheleaseagreement.

ii) Theminimumleasepaymentsasatmarch31,2011andthepresentvalueasatmarch31,2011ofminimumleasepaymentsinrespectofassetsacquiredunderfinanceleaseisasfollows:

amountinrs.

sl.No.

Particularsminimumlease

paymentsasat31.03.2011

Presentvalueofminimumlease

paymentsasat31.03.2011

1 Payablenotlaterthan1year 8,139,734 4,527,671

2 Payablelaterthan1yearandnotlaterthanfiveyears 32,558,939 25,284,180

3 Payablelaterthanfiveyears - -

Total 40,698,673 29,811,851

less:futurefinancecharges 10,886,822 -

Presentvalueofminimumleasepayable 29,811,851 -

56


57

scHeduLe 2


(b)operatinglease:

The company has taken certain premises on cancellable operating lease. These lease agreementsarenormallyrenewedonexpiry.Thecompanyhastakencarsoncancellableoperatinglease.amountpaidtowardstheseleasesareincludedinselling&administrativeexpenses.Therearenoexceptional/restrictivecovenantsintheseleaseagreements.leaserentalschargedtoProfitandlossaccountfortheyearisrs.22,01,435/-(previousyearrs.29,08,488/-).contingentrentrecognisedrs.Nil(previousyearrs.Nil).

19 a) Thecompanydoesnothave taxable incomeunder theconventionalmethodofcomputationofincome and further is covered by the provisions of the special economic zone act, 2005 andaccordinglynotliableforminimumalternateTaxundersection115jBoftheincometaxact,1961.hence,noprovisionforcurrenttaxhasbeenmadefortheyear.

b) ThecompanydoesnothavetaxablewealthandhencenoprovisionhasbeenmadeforwealthtaxundertheprovisionsofwealthTaxact,1957.

20 employeestockoptionscheme:

a) Thecompanyhasgranted750,000optionsundertheemployeesstockoptionPlan,2006toitsemployeesandDirectorson27thaugust2010,withavestingperiodofoneyearfromthedateofgrantoftheoption.Theexerciseperiodisfiveyearsfromthedateofissue.

b) Thegrantofoptionstotheemployeesundertheemployeesstockoptionschemeisonthebasisoftheirperformanceandothereligibiltycriteria.Theoptionsarevestedequallyoveraperiodofoneyear,subjecttothediscretionofthemanagementandfulfillmentofcertainconditions.

c) Thedetailsofgrantsundertheaforesaidschemearesummarisedbelow-

sl.no

particulars esop, 2006

2010-11 2009-10

1 grantPrice-rupees 40.15 -

2 grantdate 27-aug-10 -

3 vestingdate 26-aug-11 -

4 optiongrantedandoutstandingatthebeginningoftheyear - -

5 optionslapsed/withdrawnduringtheyear - -

6 optionsgrantedduringtheyear 750,000 -

7 optionsexercisedduringtheyear - -

8 optionsgrantedandoutstandingattheendoftheyearofwhich- 750,000 -

optionsvested - -

optionsyettovest 750,000 -

d) Duringtheyear,thecompanyhasamortisedproportionateemployeestockbasedcompensationexpenseamountingtors.8,189,671/-,whichhasbeenincludedinstaffexpenses.

56 57

22 majorcomponentsofDeferredTax:

amountinrs.

particulars

as at 31.03.2011 asat31.03.2010deferred

tax assetsdeferred

tax Liabilities

DeferredTaxassets

DeferredTax

liabilities

Difference between Book Depreciation and TaxDepreciation.

88,692,669 93,394,360

Provision for Unpaid Bonus, group gratuity andgroupleaveenchashmentdebitedtoProfit&lossaccount

1,190,759 723,889

Total 1,190,759 88,692,669 723,889 93,394,360

NetDeferredTaxliability 87,501,910 92,670,471

charged/(credit)toProfitandlossaccount (5,168,561)

23 Thecompanyhas reviewed the futurecash flowson thebasisof value inuseof itsassetsandhassatisfiedthattheestimatedrecoverableamountismorethantheamountcarriedinthebooks.accordingly,noprovisionforimpairmentlossisrequiredtobemadeintheseaccounts.

scHeduLe 2


21 earningpershare(ePs)computedinaccordancewithaccountingstandard(as)20“earningsPershare”asbelow:

particulars 2010-11 2009-10

Basic

(a) Profitaftertaxasperaccounts rs. 75,835,516 27,274,647

(b) Numberofequitysharesoutstanding Nos 20,374,382 13,874,382

(c) weightedaveragenumberofequitysharesoutstanding Nos 15,049,724 13,874,382

Basic eps rs. 5.04 1.97

diluted

(a) Profitaftertaxasperaccounts rs. 75,835,516 27,274,647

(b) weightedaveragenumberofequitysharesoutstanding Nos 15,049,724 13,874,382

(c) add:weightedaveragenumberofpotentialequitysharesonaccountofemployeestockoptions

Nos 349,515 -

(d) weighted average number of equity shares outstanding fordilutedePs

Nos 15,399,239 13,874,382

diluted eps 4.92 1.97

facevaluepershare 10.00 10.00

58


59

scHeduLe 2


24 employeeBenefits

Provisionforgratuityandleaveencashmentrepresentsprovisionmadeasperactuarialvaluationreportdated14thmay2011.

a) TheamountsrecognisedinBalancesheetareasfollows:

amountinrs.

particulars Leave encashment gratuity plan

as at31.03.2011

asat31.03.2010

as at31.03.2011

asat31.03.2010

a PresentvalueofDefinedBenefitobligation

-whollyfunded 4,502,070 4,022,549 9,123,550 5,840,099

-whollyUnfunded - - - -

less:fairvalueofPlanassets (4,759,274) (4,290,377) (6,096,689) (6,050,309)

UnrecognisedPastservicecosts - - - -

amounttoberecognisedasliability/(asset) (257,204) (267,828) 3,026,861 (210,210)

B amountsreflectedintheBalancesheet

liabilities 4,502,070 4,022,549 9,123,550 5,840,099

assets (4,759,274) (4,290,377) (6,096,689) (6,050,309)

Netliability/(asset) (257,204) (267,828) 3,026,861 (210,210)

Note:assetsarenotrecoginsedintheBalancesheet

b) TheamountsrecognisedinProfitandlossaccountareasfollows:

amountinrs.


as at31.03.2011

asat31.03.2010

as at31.03.2011

asat31.03.2010

currentservicecost 305,557 331,576 800,250 794,098

interestcost 321,804 295,574 467,208 391,876

less:expectedreturnonPlanassets (401,441) (335,643) (536,666) (497,941)

actuariallosses/(gains) (147,840) (299,281) 2,774,646 (91,693)

Pastservicecost - - - -

effectofanycurtailmentorsettlement - - - -

actuarialgainnotrecognisedinbooks - - - -

total included in “staff expenses” 78,080 (7,774) 3,505,438 596,340

actualreturnonPlanassets 401,441 335,643 536,666 497,941

58 59

scHeduLe 2

notes forMIng part of accountsc) Thechangesinthepresentvalueofdefinedbenefitobligationrepresentingreconciliationofopeningand

closingbalancesthereofasfollows:amountinrs.


as at31.03.2011

asat31.03.2010

as at31.03.2011

asat31.03.2010

BalanceofthepresentvalueofDefinedBenefit 4,022,549 3,694,680 5,840,099 4,898,444obligationasatthebeginningoftheyearadd:currentservicecost 305,557 331,576 800,250 794,098add:interestcost 321,804 295,574 467,208 391,876add:contributionsbyPlanPartners,viz. i)employer - - - - ii)employee - - - -add/less:actuariallosses/(gains) (147,840) (299,281) 2,774,646 (91,693)less:BenefitsPaid - - (758,653) (152,626)add:Pastservicecost - - - -BalanceofthepresentvalueofDefinedBenefitobligationasattheendoftheyear 4,502,070 4,022,549 9,123,550 5,840,099

d) changeinfairvalueofplanassetsrepresentingreconciliationoftheopeningandclosingbalancesthereofareasfollows:

amountinrs.


as at31.03.2011

asat31.03.2010

as at31.03.2011

asat31.03.2010

openingbalanceofthefairvalueoftheplanassetsasatthestartoftheyear

4,290,377 3,202,393 6,050,309 5,217,148

add:expectedreturnonplanassets 401,441 335,643 536,666 497,941add/(less):actuarialgains/(losses) - - - -add/(less):Transferin/(Transferout) - - - -add:contributionbytheemployer 67,456 752,341 268,367 487,846add:contributionbyplanparticipants - - - -less:Benefitspaid - - (758,653) (152,626)less:settlements - - - -closingbalanceofthefairvalueoftheplanassetsasattheendoftheyear

4,759,274 4,290,377 6,096,689 6,050,309

e) allinvestmentsinPlanassetsaremanagedbythelic.

f) Principalactuarialassumptionsatthebalancesheetdate(expressedasweightedaverages):2010-11 2009-10

DiscountrateasatYearend 8.00% 8.00%expectedreturnonplanassetsasatyearend 9.30% 8.00%salarygrowthrate:

a) gratuityscheme 8.00% 8.00%b) leaveencashmentscheme 6.00% 6.00%

attritionrate:1-3%perannum,assumedtobeindependentofageandservice.Theestimatesoffuturesalary increases,considered inactuarialvaluation, take intoaccount inflation,senioritypromotionandotherrelevantfactors,suchassupplyanddemandintheemploymentmarket.

60


61

scHeduLe 2notes forMIng part of accounts

g) contributiontoprovidentfundsaremadetotheregionalProvidentfundoffice.25 (a) Duringtheyear,thecompanyhasmadepreferentialallotmentof6,500,000equitysharesofface

valueofrs.10/-eachtoagileelectricDrivesTechnologiesandholdingsPrivatelimitedatapremiumofrs.66.30/-withalock-inperiodofoneyearfrom25thjanuary2011to24thjanuary2012.

(b) optionsoutstandingasattheendoftheyearonun-issuedsharecapital:

ParticularsNumberofequitysharestobeissuedasfullypaid

asat31.03.2011

asat31.03.2010

employeestockoptionsgrantedandoutstanding 750,000 -

26 (a) The investments in ijTPlastics&ToolsPrivatelimited (“ ijTPl”)consistingof7,430,000equitysharesoffacevalueofrs.10/-eachfullypaidwasreplacedwith2,451,900sharesofrs.10/-eachfullypaidofagileelectricsubassemblyPrivatelimited(“aesPl”)pursuanttomergerofijTPlwithaesPlvideorderofthehonorablehighcourtofmadrasjudicaturecPNo.312/2010dated2ndmarch2011,swapratiobeing33equitysharesofrs.10/-eachfullypaidupofaesPlforevery100equitysharesofrs.10/-eachfullypaidupofijTPl.

(b) Duringthepreviousyear2009-10,thecompanyhadpledgeditsinvestmentsinijTPlastics&ToolsPrivatelimitedwithbankassecurityforthecreditfacilitiesavailedfrombankbyijTPlastics&ToolsPrivatelimited.furthertoamalgamationmentionedinNote26(a),thecompanyisintheprocessofcreatingapledgeontheinvestmentinagileelectricsubassemblyPrivatelimitedwiththebanker

(c) ThecompanyhasincreaseditsinvestmentinBoschelectricalDrivesindiaPrivatelimited(“investeecompany”)on3rdjanuary2011to26%,therebymakingtheinvesteecompany,anassociate.

27 (a) Deduction of product development expenses under capital work in progress - intangible assetsincludesdevelopmentexpenditureamountingtors.2,840,537/-foraprojectinprogresstransferredatcosttoafellowsubsidiaryduringtheyearandrs.2,862,425/-recoveredfromacustomertowardsproductdevelopment.

(b) During theyear, thecompanyhaswrittenoff productdevelopmentexpenditureunder intangibleassetamountingtors.7,872,278/-(net)asthesamehasbeenobsoletedduetodiscontinuanceoftheproductdevelopment.

28 subsequenteventsThe company has obtained central government approval for payment of increased remuneration ofrs.9,600,000/-perannumtomr.P.mukund,managingDirectorofthecompany,foraperiodofoneyearfrom01.04.2010to31.03.2011videletterno.B5040407/5/2011-cl-viidated18.04.2011.

29 figuresforthepreviousyearhavebeenregrouped/reclassifiedwherevernecessary.

asperourreportattached P. Mukund k.k. nohria k. igarashisharP & Tannan managingDirector chairman C.P. dusad charteredaccountants g.n. Mani icairegistrationNo.003792s T. igarashi r. Chandrasekaran T.s. Maharani keiiChi igarashi head-finance companysecretary Directors L. VaidyanaThan membershipNo.16992 Partner membershipNo.16368

Place : chennai Date : may26,2011

60 61

scHeduLe 2notes forMIng part of accounts

additionalinformation,asrequiredunderPartivofschedulevitothecompaniesact,1956.

BaLance sHeet aBstract and coMpany’s generaL BusIness profILei. registration details :

registrationNo. 2 1 9 9 7

BalancesheetDate 3 1 0 3 2 0 1 1 statecode 1 8

Date month Year

ii. Capital raised during the year (amount in rs. Thousands)

Publicissues rightsissue

N i l N i l

Bonusissue Preferentialissue

N i l 4 9 5 9 5 0

iii. Position of Mobilisation and deployment of Funds (amount in rs. Thousands)

Totalliabilities Totalassets

1 7 2 3 0 1 8 1 7 2 3 0 1 8

sources of Funds

Paid-up-capital reserves&surplus

2 0 3 7 4 4 8 1 4 3 4 5

employeestockoptionsoutstanding securedloans

8 1 9 0 5 7 8 2 3 5

Unsecuredloans DeferredTaxliability

2 9 8 1 2 8 8 6 9 2

application of Funds

Netfixedassets&Netintangibleassets investments

8 8 4 7 0 5 2 8 6 1 6 5

DeferredTaxassets Netcurrentassets

1 1 9 0 3 5 8 4 7 1

Profit&losscount

1 9 2 4 8 7

iV. Performance of Company (amount in rs. Thousands)

Turnover Totalexpenditure

1 9 7 6 2 0 7 1 9 0 5 5 4 0

Profit/lossbeforetax Profit/lossaftertax

+- +-

+ 7 0 6 6 7

+ 7 5 8 3 6

(Pleasetickappropriatebox+forProfit-forloss)

62


6�

+-Basicearningpershareinrs. Dividendrate%

+ 5 . 0 4 N i l

+-Dilutedearningpershareinrs.

+ 4 . 9 2

V. generic names of Three Principal Products / services of Company(aspermonetaryterms)

itemcodeNo.(iTccode) 8 5 0 1 3 3 0 1

ProductDescription e l e c T r i c m i c r o m o T o r s

P. Mukund k.k. nohria k. igarashi managingDirector chairman C.P. dusad g.n. Mani T. igarashi r. Chandrasekaran T.s. Maharani keiiChi igarashi head-finance companysecretary Directors membershipNo.16992


62 6�

casH fLoW stateMent for tHe year ended MarcH 31, 2011

2010-11 2009-10


a) casH fLoW froM operatIon actIVItIes :

Netprofit/(loss)beforetax 70,666,955 37,624,989

adjustmentsfor:

Depreciation,amortisationandobsolescence 105,326,189 64,805,066

Profitonsaleoffixedassets (186,551) (644,241)

employeestockoption-discountformingpartofstaffexpenses

8,189,671 -

interest(Net) 98,894,170 84,818,866

212,223,479 148,979,691

operatingprofit/(loss)beforeworkingcapitalchanges 282,890,434 186,604,680

adjustmentsforincrease/(Decrease)in

Tradeandotherreceivables (238,738,351) 169,698,979

inventories (45,761,358) 22,609,917

TradePayables 5,702,293 38,870,537

(278,797,416) 231,179,433

cashgeneratedfromoperations 4,093,018 417,784,113

less:Directtaxespaid 5,659,180 3,900,000

net cash from / (used in) operating activities (a) (1,566,162) 413,884,113

B) casH fLoW froM InVestIng actIVItIes

Purchaseoffixedassets (138,749,443) (28,069,921)

saleoffixedassets 5,868,083 15,835,304

Purchaseofinvestments (142,864,900) (19,000,000)

interestreceived 1,487,604 296,478

net cash from / (used in) investing activities (B) (274,258,656) (30,938,139)

c) casH fLoW froM fInancIng actIVItIes

Proceedsfromissueofsharecapital 495,950,000 -

repaymentofborrowings (94,674,175) (308,488,686)

Dividendspaid - -

interestpaid (100,381,774) (85,115,344)

net cash from / (used in) financing activities (c) 300,894,051 (393,604,030)

Netincrease/(decrease)incash&cashequivalents(a+B+c)

25,069,233 (10,658,056)

cashandcashequivalentsasatthebeginningoftheyear 30,177,810 40,835,866

cashandcashequivalentsasattheendoftheyear 55,247,043 30,177,810

64


Notes:

1. cashflowstatementhasbeenpreparedundertheindirectmethodassetoutinaccountingstandard-3asspecifiedincompanies(accountingstandards)rules,2006.

2. Purchaseoffixedassetsincludesmovementsofcapitalwork-in-progressbetweenthebeginningandendoftheyear.

3. cashandcashequivalentsrepresentcashandbankbalances.

4. Previousyear’sfigureshavebeenregrouped/reclassifiedwhereverapplicable

5. cash and cash equivalents inclue fixed deposits of rs. 6,021/- pledged as security with sales taxdepartment,notavailableforimmediateuse.

asperourreportattached P. Mukund k.k. nohria k. igarashisharP & Tannan managingDirector chairman C.P. dusad charteredaccountants g.n. Mani icairegistrationNo.003792s T. igarashi r. Chandrasekaran T.s. Maharani keiiChi igarashi head-finance companysecretary Directors L. VaidyanaThan membershipNo.16992 Partner membershipNo.16368


64

DPid&clientiD:______________

folioNo:______________

i/we………………………………………………………………………………………………………...............of.……………………………………………………............beingamember/membersoftheabovenamedcompany,herebyappoint.....................…………………………………………………………………………or…………………………………………………failinghim/her……………………………………..…........as my /our Proxy to vote for me /us on my/our behalf at the 19th annual general meeting of thecompany to be held at the sathguru gnanananda hall, Narada gana sabha Trust complex,minihall,314,T.T.K.road,chennai-600018at3.00P.m.onThursday,15thseptember,2011andatanyadjournmentthereof.

signature:_______________________________________________________

signedthis………….........................dayof…………....................................2011

Note:Proxyformsmustreachthecompany’sregisteredofficenotlessthan48hoursbeforethemeeting.

.......................................................................................................................................................... ......

IgarasHI Motors IndIa LIMIted

regd.office:PlotNo.B-12toB-15,Phaseii,mePz-sez,Tambaram,chennai-600045.

attendence sLIp

Tobecompletedandhandedoverattheentranceofthemeetinghall

...................................................... .......................................... .............................. Nameofattendingmember folioNo DPiD&clientiDNo. (inBlockletters)

................................................................................................................................................... NameofProxy(inBlockletters)

TobefillediftheProxyattendsinsteadofthemember

No.ofsharesheld.................................................................................................................................

iherebyrecordmypresenceatthe19thannualgeneralmeetingofthecompanyheldatthesathgurugnananandahall,NaradaganasabhaTrustcomplex,minihall,314,T.T.K.road,chennai-600018at3.00P.m.onThursday,15thseptember,2011.

member’s/Proxy’ssignature

(Tobesignedatthetimeofhandingoverthisslip)

forofficeUse.

IgarasHI Motors IndIa LIMIted

regd.office:PlotNo.B-12toB-15,Phaseii,mePz-sez,Tambaram,chennai-600045.

proXy forM

affixa

re.1

rev.stamp

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