avatar Wabco Holdings Inc. Manufacturing
  • Location: Michigan 
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    6th Annual Report 2010


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    Board of Directors Share Transfer Agent Factories VENU SRINIVASAN* Sundaram-Clayton Limited Plot No. 3 (SP), III Main Road, Chairman New No. 22 (Old No. 31), Ambattur Industrial Estate, Railway Colony 3rd Street, Chennai 600 058 C N PRASAD Mehta Nagar, Chennai 600 029 Tel. : 044 4224 2000 Tel. : 044-2374 1889 Fax : 044 4224 2009 D E UDWADIA 044-2374 2939 NARAYAN K SESHADRI Large Sector, Fax : 044-2374 1889 Adityapur Industrial Area, NIKHIL MADHUKAR VARTY E-mail : kr.raman@scl.co.in Gamharia, Seraikella-Kharsawan Dist. sclshares@gmail.com Jharkhand 832 108 LEON LIU investorscomplaintssta@scl.co.in Tel. : 0657 661 6800 TREVOR LUCAS madhavan.rajagopalan@wabco-tvs.co.in Fax : 0657 238 7997 KURT LEHMANN Bankers Plot No. AA8, Central Avenue, STATE BANK OF INDIA Auto Ancillary SEZ, Whole-time Director Corporate Accounts Group Branch Mahindra World City, Greams Dugar Natham Sub-Post, Chengalpet, P KANIAPPAN Greams Road Kancheepuram District 603 002 Chennai 600 006 Tel. : 044 4744 2000 Chief Financial Officer Fax : 044 4749 0006 T S RAJAGOPALAN Auditors Software Design Centre SUNDARAM & SRINIVASAN General Manager (Finance) and Secretary Chartered Accountants “Ispahani Centre”, 7th Floor, R MADHAVAN 23 Sir C P Ramaswamy Road 123/124 Nungambakkam High Road, Alwarpet, Chennai 600 018. Chennai 600 034 Tel. : 044 28285000 Audit Committee Fax : 044 28332212 Solicitors & Advocates NARAYAN K SESHADRI UDWADIA & UDESHI Chairman Module No. 1107, D Block Solicitors & Advocates 11th Floor, Tidel Park D E UDWADIA Elphinstone House No. 4, Rajiv Gandhi Salai, 1st Floor, 17 Murzban Road C N PRASAD Taramani, Chennai 600 113 Mumbai 400 001 Tel. : 044 22545700 Investors’ Grievance Committee Fax : 044 22540909 NARAYAN K SESHADRI Registered Office Chairman Plot No. 3 (SP), III Main Road, P KANIAPPAN Ambattur Industrial Estate, CONTENTS Page No. Chennai 600 058 C N PRASAD Directors’ report to the shareholders 3 Tel. : 044 4224 2000 Fax : 044 4224 2009 Listing of Shares with Management discussion and analysis report 7 Web Site : www.wabco-tvs.com Madras Stock Exchange Limited Report on corporate governance 10 Chennai National Stock Exchange of India Limited Auditors’ report on corporate governance 20 Mumbai Auditors’ report to the shareholders 21 Bombay Stock Exchange Limited Mumbai Balance Sheet 24 Profit & Loss account 25 * upto 19th May 2010 Schedules 26 Cash flow statement 44 General Business Profile 46 1


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    FINANCIAL HIGHLIGHTS Rupees in lakhs Year ended March 31st 2008 2009 2010 Profit and Loss Account Sales 54,655 42,595 59,126 Other income 1,221 1,983 1,821 Total income 55,876 44,578 60,947 Gross profit before interest, depn & tax 11,777 7,334 13,567 Depreciation 1,012 1,393 1,444 Profit before interest & tax 10,765 5,941 12,123 Interest 329 685 289 Profit before tax 10,436 5,256 11,834 Profit after tax 6,984 3,552 7,859 Balance Sheet Net Fixed assets 17,407 19,528 18,677 Investments 866 900 221 Net current assets 843 5,758 9,178 Total 19,116 26,186 28,076 Share capital 948 948 948 Reserves & surplus 15,820 18,818 26,084 Net worth 16,768 19,766 27,032 Loan funds 2,024 6,020 719 Deferred tax (net) 324 400 325 Total 19,116 26,186 28,076 EPS (Rs) 36.82 18.73 41.43 DPS (Rs) 10.98 2.50 2.50 Book value per share (Rs) @ 88.40 104.21 142.51 Return on capital employed (ROCE) % @ 111.9 26.2 44.7 Return on net worth (RONW) % @ 83.3 19.4 33.6 Fixed assets turnover (no of times) @ 6.2 2.3 3.1 Working capital turnover (no of times) 129.1 12.9 7.9 Gross profit as % of sales (EBITDA) 21.5 17.2 22.9 Gross profit as % of total income 21.1 16.5 22.3 Net profit as % of total income 12.5 8.0 12.9 ROCE is profit before interest and tax divided by average networth plus loan funds RONW is profit after tax divided by average networth Fixed assets turnover is sales divided by average net fixed assets as at the end of the year. Working capital turnover is sales divided by average net current assets as at the end of the year. @ Return on capital employed, Return on net worth and Fixed assets turnover ratios for 2007-08 is based on pre de-merger figures and hence not comparable with the ratios for 2008-09 and 2009-10 2


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    Directors’ report to the shareholders The directors herewith present the sixth annual report and the audited economy resulted in growth in CV industry as explained in the accounts for the year ended 31st March 2010. above paragraph and also increased sales from aftermarket and 2. FINANCIAL HIGHLIGHTS exports. Rs. in lakhs The Company has outperformed MHCV market growth in OE Details Year ended Year ended through, 31.03.2010 31.03.2009 a. Increased content per sale; and Sales and other income 60,946.82 44,577.78 b. Improved market share Gross profit before interest and 5. CAPITAL EXPENDITURE depreciation 13,567.09 7,334.11 A capital expenditure of Rs 35 crores is planned for the year Interest –Net 289.41 685.42 2010-2011 after considering the industry growth in this year. Depreciation 1,444.49 1,393.21 The expenditure will be incurred on a case to case basis. Profit before tax 11,833.19 5,255.48 6. DIRECTORS Provision for taxation (including During the year, Mr D E Udwadia, Mr Leon Liu and Mr Nikhil deferred tax and fringe benefit tax) 3,974.64 1,703.27 Madhukar Varty, directors, retire at the ensuing annual general Profit after tax 7,858.55 3,552.21 meeting of the Company in terms of the articles of association Surplus /(loss) brought forward from of the Company, and being eligible, offer themselves for previous year 5,156.52 2,515.10 re-appointment. Total 13,015.07 6,067.31 A brief resume of the aforesaid directors and other information have been detailed in the notice convening the annual general Appropriations: meeting of the Company. Appropriate resolutions for their Tax relating to earlier years 39.59 – reappointment are being placed for approval of the shareholders Interim dividend paid – 474.20 at the ensuing annual general meeting. Your directors recommend Proposed dividend 474.20 – their reappointment as directors of the Company. Dividend tax paid – 80.59 7. AUDITORS Dividend tax payable 78.76 – Messrs. Sundaram & Srinivasan, Chartered Accountants, Chennai Transfer to general reserve 785.86 356.00 have been re-appointed as statutory auditors at the last annual general meeting held on 24th September 2009 to hold office till Surplus/(Loss) in Profit & loss account 11,636.66 5,156.52 the conclusion of the ensuing annual general meeting. 13,015.07 6,067.31 Messrs. Sundaram & Srinivasan, Chartered Accountants, Chennai, 3. DIVIDEND the retiring auditors of the Company have advised that they do not The board of directors have recommended a dividend of Rs 2.50 wish to be re-appointed as the Company's auditors at the ensuing per share for the year ended 31st March 2010 (representing 50% annual general meeting. In view thereof, the directors recommend on the paid up share capital of Rs 948.38 lakhs) absorbing a that Messrs. S.R. Batliboi & Associates, Chartered Accountants, sum of Rs.474.20 lakhs for approval of the shareholders in the Chennai, be appointed as the Company's auditors to hold office from ensuing annual general meeting. the conclusion of the ensuing annual general meeting until the conclusion of the next following annual general meeting. 4. PERFORMANCE The Directors place on record their deep appreciation of the During the year 2009-10, the sales of medium and heavy valuable services rendered by Messrs. Sundaram & Srinivasan, commercial vehicles (MHCV) registered a positive growth of 33% Chartered Accountants as Auditors. over the previous year 2008-09 and the sale of light commercial vehicles (LCV) registered a positive growth of 37% during the 8. STATUTORY STATEMENTS same period. Overall, the commercial vehicle (CV) industry ended Conservation of energy, technology absorption and foreign with a positive growth of 35% over the previous year. exchange earnings and outgo During the year, the Company achieved a total turnover of The information regarding conservation of energy, technology Rs 609 crores as against turnover of Rs 446 crores registered absorption and foreign exchange earnings and outgo is given in a growth of 37%. The growth in the turnover is due to improved Annexure I to this report, as per the requirements of Section 3


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    217(1)(e) of the Companies Act, 1956, read with the effect is attached to this report as required by clause 49 of Companies (Disclosure of Particulars in the Report of Board the Listing Agreement with the stock exchanges. A certificate of Directors) Rules, 1988. issued by the auditors of the Company regarding compliance Particulars of employees of conditions of corporate governance, is also annexed to the said report. Particulars of employees pursuant to Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of The whole-time director (CEO) and the chief financial officer (CFO) Employees) Rules, 1975, as amended, is set out in Annexure of the Company have certified to the board on financial statements II and forms part of this report. However, in pursuance of Section and other matters in accordance with clause 49(V) of the Listing 219(1)(b)(iv) of the Companies Act, 1956, the Report and Accounts Agreement pertaining to CEO/CFO certification for the financial is being sent to all the Members of the Company excluding the year ended 31st March 2010. aforesaid information and the said particulars will be made available A management discussion and analysis report, as required by on request and also made available for inspection at the Registered the Listing Agreement, is also attached which forms part of this Office of the Company. Any Member interested in obtaining such report. particulars may write to the Company Secretary at the Registered Office of the Company. 10. SHIFTING OF REGISTERED OFFICE OF THE COMPANY Directors’ Responsibility Statement The board of directors at their meeting held on 19th January 2010 Pursuant to the requirement of Section 217(2AA) of the Companies have approved shifting of the registered office of the Company Act, 1956 with respect to directors' responsibility statement, it is from No.29, Haddows Road, Chennai - 600 006 to the factory hereby confirmed: premises located at Plot No 3 (SP), III Main Road, Ambattur Industrial Estate, Chennai 600 058 effective 1st April 2010 for (i) that in the preparation of annual accounts for the financial operational and administrative convenience. year ended 31st March 2010, the applicable accounting standards have been followed along with proper explanation Notice of the above change has been given to the Registrar of relating to material departures; Companies in compliance with Section 146 of the Companies Act, (ii) that the directors had selected such accounting policies and 1956. applied them consistently and made judgments and estimates 11. ACKNOWLEDGEMENT that were reasonable and prudent so as to give a true and The directors gratefully acknowledge the support and co-operation fair view of the state of affairs of the Company at the end received from Messrs. T V Sundram Iyengar & Sons Limited, of the financial year and of the profit of the Company for Madurai, who were a promoter shareholder till 3rd June 2009, the year under review; and WABCO Europe BVBA, Belgium. (iii) that the directors had taken proper and sufficient care for The directors thank the vehicle manufacturers, distributors, vendors the maintenance of adequate accounting records in accordance and bankers for their continued support and assistance. with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting The directors wish to place on record their appreciation of the fraud and other irregularities; and excellent work done by employees of the Company at all levels (iv) that the directors had prepared the accounts for the financial during the year. The directors specially thank the shareholders year ended 31st March 2010 on a "going concern basis". for the confidence reposed by them in the Company. 9. CORPORATE GOVERNANCE For and on behalf of the board The company has complied with the provisions of the Listing Agreement concerning corporate governance and a report to this Chennai VENU SRINIVASAN 4th May 2010 Chairman 4


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    Annexure I to the Directors’ report Information as required under Section 217(1) (e) of the Companies Act,1956 A. CONSERVATION OF ENERGY (b) Automatic slack adjuster (ASA) with patented adjustment mechanism developed and validated for European market. 1. Measures taken (c) New Air Processing and Distribution Assembly (APDA) which i) Introduction of dedicated small capacity portable compressor was in promotion phase last year is now fully developed, for holiday working. validated and production ready. This product contributes to ii) Reduction in lighting power by introducing individual control clean working environment for long life of pneumatic systems of doom lights in shop floor - 80 lamps completed. on vehicle. iii) Introduce thyrister control for canteen electric heater to control (d) Improved and redesigned D2 governor valve with patented even voltage supply. sealing solution developed and validated for US market. iv) Time based control for canteen air curtain system. (e) Design activity kicked off on fourteen valve devices for North American OEMs as part of market expansion strategy. These v) Thermal insulation for chiller water cooling. devices deliver best in class performance, capable of operating vi) Chiller power consumption reduction through increase the in higher temperature and corrosive environment. AHU heat transfer ration. (f) New Life Compressor II generation (NLC II) which was under vii) Power consumption reduction in compressor by optimizing the promotion phase last year is now developed and undergoing auto drain system. customer validation. This is a unique patented solution for viii) Improve canteen steam boiler efficiency by steam line improved performance at reduced cost to the customer modification. compared to the previous generation NLC I. ix) Minimizing the water consumption in canteen application. (g) New initiative for engineering excellence based on Model Based Engineering (MBE) launched. Mathematical models for The above measures have resulted in an annual saving of about flow simulation of valves and compressor performance Rs. 28.71 lakhs. simulation developed and validated, which is expected to 2. Measures Proposed significantly reduce design lead time for new products. i) Periphery light provided through renewable energy (h) Indigenous environmentally friendly technology developed for (Emergency light - With Solar control). achieving corrosion resistance of products (480 hours of neutral salt spray) to match expectations of global customers. ii) Power saving through LED light implementation in office area. (i) New welding process developed to achieve extended life of iii) Introduce thyrister control for surface protection unit equipment brake chamber parts critical to safety. electric heater to control even voltage supply. (j) Kicked off development of Automated Manual Transmission iv) Recover screw compressor heat for using in Surface Protection (AMT) for Indian customers. This technology will significantly Unit (SPU) water heating. reduce driver fatigue and improve fuel efficiency. v) Reduce machining cell power consumption by 5% through (k) Electronically Controlled Air Suspension (ECAS), which was energy mapping of 20 identified cells. promoted last year in Indian Market introduced in production vi) Eliminate electric lamps in three identified office areas by vehicles. utilizing direct daylight. (l) ABS adapted and successfully introduced in trailer systems vii) Increase the compressor efficiency by reducing the leak in and off-highway dumpers to significantly improve road safety. shop floor and assembly. (m) Continued focus on cost reduction based on process and viii) Canteen solar hot water system. design change to reduce material content has yielded significant ix) Demand controller for compressor air system. benefits. This will result in a saving of about Rs. 30.00 lakhs per annum. (n) Significant effort at cost reduction through transferring production of brake chambers from Europe to India with locally B. TECHNOLOGY ABSORPTION developed parts, which are fully validated to global customer standards. Research & Development (R & D) 1. Specific areas in which R & D is carried out by the company. 2. Benefits derived as a result of R & D: Existing activities: (a) Improved safety of vehicles through technology - ABS (a) Double diaphragm spring brake actuator (DDSBA) type introduction in trailers and off-highway vehicles and 20/24 and upgraded version of type 16/24 for disc brake development of ASA. validated and production ready for European Market. These (b) Market expansion and improved competitive position through devices are designed for high level of robustness against dust significantly improved products for new markets - DDSBA, D2 and water entry. governor valve, valves for North American OEMs. 5


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    (c) Improved comfort levels of state-of-the art buses - ECAS 4. Expenditure on R & D: Rs. in Lakhs introduction. Capital expenditure 108.06 (d) Energy saving - AMT development for heavy vehicles and Recurring expenditure (including salaries) 867.17 NLC II compressor with energy saving feature. 975.23 (e) New Clutch servo for the European Aftermarket developed and productionised. Total expenditure as percentage of sales turnover 1.60% (f) Environmentally friendly technologies of surface protection of Technology absorption, adaptation and innovation: products. (a) Efforts in brief: (g) The innovative ideas generated during the year have enabled 1. Knowledge acquisition in design and development area the Company in filing application for six patents under the standardized continuously through creation of new design Patents Act 1970 guidelines and calculation methods and updation of already (h) Significant cost reduction and improved customer value through available data. innovative design and transfer of production of brake chambers. 2. Increased use of engineering plastics in products to reduce cost and weight and innovatively combine functions. 3. Future plan of action: 3. Development of new types of rubber sealing components Development and launch of following products : capable of high temperature operation. i. Fourteen valve devices for North American OEMs. 4. Absorption and adaptation of advanced technologies like ECAS ii. Products for door control system for European market and AMT. - door cylinder, solenoid control valve and emergency 5. Use of Model based engineering methods to improve design valve. quality and reduce lead time. iii. Next generation Foot Brake Valve for European customer (b) Benefits derived as a result of the above efforts: with internal pressure limiting feature. 1. Significant growth in R&D engineers with standardized training iv. Value engineered Foot Brake Valve with integrated switch methods to enhance competency. for Indian customers. 2. Developed innovative products to improve competitive position v. New graduated hand control valve conforming to ECE in the market, expand market through new technologies and R13 regulations for Indian customers. systems and leverage global markets. vi. Concept development of simplified ECAS solution for 3. Development of products with best in class performance and Indian and Asian market. reliability. vii. DDSBA for 'S' Cam brakes for US market. 4. Enhancement of comfort levels in heavy vehicles, improvement of fuel economy through new technology, which enhances viii. Brake chambers for US market. competitive position in markets and increases content per ix. Long stroke type 24/24 Spring Brake Actuator and Brake vehicle. Chamber for Indian market. 5. Deeper theoretical understanding of product function and x. Value engineered Spring Brake Actuator for Indian Market. design. xi. ASA variants for Indian customers. (c) Details relating to imported technology: (Technology imported xii. Compressor with energy saving feature for European during the last 5 years reckoned from the beginning of the and Indian customer engines in various capacity ranges financial year). from 230 cm3 to 460 cm3. Nil xiii. Value engineered condenser oil separator for Indian/ global markets. C. FOREIGN EXCHANGE EARNINGS AND OUTGO xiv. Integral pedal unit for Indian customers. EXPORT ACTIVITIES: xv. Clutch servo for Russian customer. st Exports during the year ended 31 March 2010 amounted to xvi. Clutch master cylinder for US/ Brazilian markets. Rs. 5,525.48 lakhs. xvii. Value engineered clutch master cylinder. Total foreign exchange used and earned: xviii. Value engineered clutch servo. a) Foreign exchange used Rs. 4,622.41 lakhs xix. Pneumatic clutch actuator. b) Foreign exchange earned Rs. 7,605.95 lakhs xx. Introduction of Electronically Controlled Braking System (EBS) to Indian customers for enhanced safety. For and on behalf of the board xxi. Production level introduction of AMT for Indian vehicles. xxii. Rubber seals resistant to chemical attack from oil Chennai VENU SRINIVASAN products. 4th May 2010 Chairman 6


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    MANAGEMENT DISCUSSION AND ANALYSIS REPORT As addressed in last year's Management Discussion and Analysis With the above measures taken by the Government, the Report, during the year 2009-10, WABCO Holdings Inc., USA a production of Medium and Heavy Commercial Vehicles global technology leader and tier-one supplier to the commercial (MHCV) in 2009-10 compared to 2008-09 has recorded a vehicle industry, raised its ownership position through indirectly owned subsidiary M/s Clayton Dewandre Holdings Ltd, UK to 75 growth of 31% as per data given below: percent in WABCO-TVS (India) Limited (WTIL). Category 2009-10 2008-09 growth Post the global financial crisis and general economic slowdown, Medium and Heavy during the year under review, WTIL, the leader in the automotive Commercial Vehicles 250,171 191,286 31% air and air assisted brake actuation systems for the commercial vehicle industry in India, recorded its best ever performance. (Source: SIAM) The Company recorded all time high sales of Rs. 609 crores during Indian companies are gaining recognition as manufacturers 2009-10 as against Rs. 446 crores in 2008-09, registering a growth of high quality automotive components in the international of 37%. Profit before tax also recorded all time high at Rs.118 market. Presence of global players like VOLVO, MAN, crores as against Rs.52 crores in the previous year, representing Navistar and Daimler will drive technology in our Market. an increase of 127%. Exports are expected to grow, driven by the cost management I. Industry Structure and Development: factors of international manufacturers to source from cost-effective countries which are expected to benefit the After coming-out of global recession, the Indian economy Company's businesses. recorded a strong performance during 2009-10 especially in H2 of FY 2009-10. In spite of negative growth in agricultural II. Business outlook and overview sector, GDP is expected to register a 7.5% growth, facilitated In 2010-11, GDP growth will be propelled by a strong by much improved 9.4% growth in industrial production and performance by the Industrial sector and a robust recovery 8.3% growth in the services sector. However, inflation is in the Agricultural & allied sectors. The services sector too reported to be increasing and is expected to be around at is expected to do well. The industrial sector is projected to 4% for the year under review. grow by 9.6% mainly due to growth in manufacturing sector. In order to improve the economy, the Government has taken Agriculture sector is expected to grow at 5.8% and Services various measures including stimulus measures like Excise sector is expected to grow at 9.8%. duty reduction, investment in infrastructure projects, special This improved outlook of the economy is expected to have focus on urban development through JNNURM project, reduced positive impact in the automotive sector, which will see a interest rate, improved lending etc., resulted in increase in growth in 2010-11. The increased infrastructure development commercial vehicles production / sales in 2009-10. projects in the domestic market and increase in agricultural The development of road infrastructure is a key factor that output will result in improved freight demand availability, the influences the growth of the Indian commercial vehicle industry. MHCV industry is likely to register a positive growth of Various projects initiated by National Highway Authority of 10 ~ 12% in the year 2010-11. India (NHAI) and the status of various projects as on 28th III. Opportunities & Threats February 2010: The Company caters to requirements of commercial vehicle Total Completed Under Balance segment of the automotive industry. With improved road length (in %) implement- to be infrastructure, the demand for faster vehicles that carry (in Km) ation awarded higher payloads is increasing. To ensure road safety, Golden Government of India has introduced regulation for mandatory Quadrilateral 5846 98.6% 1.4% NIL fitment of anti-lock braking systems (ABS) for commercial North-South, vehicles carrying hazardous goods from October 2006, tractor- East-West Corridor 7300 66.6% 25.3% 8.1% trailers and buses with national permit and hilly terrains from October 2007. NHDP Phase III 12109 12.2% 32.7% 55.1% NHDP Phase V 6500 2.5% 16.5% 81% The Company has done extensive application engineering for all categories of vehicles and offering total solution to the NHDP Phase VI 1000 0 0 0 domestic OEMs including the new entrants like Mahindra NHDP Phase VII 700 0 5.9% 94.1% Navistar and Daimler. The Company has made its test track, Port Connectivity the only test track of its kind available in the country today, & others 380 72.1% 26.3% 1.6% useful to prove our new systems / products and also made Others 945 93.2% 4.8% 2.0% available for government agencies for certification testing. Total NHDP 34800 38.6% 20.5% 40.9% Being the part of WABCO, growth opportunities are available (Source: NHAI) through productionizing transfer projects (inter-company 7


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    exports sales) and technology transfer. Local market growth VI. Operations review opportunities through increase in content per vehicle in the A. Manufacturing form of introducing new systems / technologies like Automated Manual Transmission (AMT), Electronically Controlled Air In the year 2007-08 the company made operational its Suspension (ECAS) Clutch actuation systems etc. new manufacturing facility in a Special Economic Zone In the aftermarket side, so far, the Company has commissioned (SEZ) at 'Mahindra World City' near Chennai. During the year 2009-10, the company had the full benefit of 156 authorized service centers at strategic locations across the the plant and is expected to bring additional revenue country, to provide quicker and better service on air brake growth during the coming years. aggregates. Further, to improve availability of quality service in To meet the challenges of emerging competition and rural areas, the Company also commissioned 145 certified to serve the customers better, the Company had already workshops. These initiatives would result in improved service set-up a manufacturing facility in Jamshedpur nearer practices, availability of genuine parts and generate additional to a major customer plant. The Company is working revenue for the Company. on a business case to open one more plant in the western sector to service customers in that region. The Company's competitors are active and continue to supply to key customers. The Company's manufacturing facilities follow the best practices such as Total Quality Management (TQM), IV. Risks and concerns Total Productive Maintenance (TPM) and Lean The cyclical nature of the Indian commercial vehicle industry Manufacturing and has best-in-class practices for safety, (Company's major customer segment) might affect the demand. work environment, water and energy conservation. These initiatives are deployed company wide to achieve In 2010-11, operating expenses are likely to rise with the expected significant improvement in productivity and reduction in increase in prices of key raw materials, and the implementation manufacturing cost. of new emission norms. Commercial Vehicles manufacturers are Continuous improvement actions are implemented to likely to pass on these additional costs to customers. However, improve manufacturing quality and productivity in all the the sensitivity of transporters' profitability to the increase in vehicle manufacturing locations. cost would determine the extent of the cost actually passed on, During the year under review, the Company obtained especially after the rise in excise duty and fuel prices in the Union "Super Platinum" award, for its manufacturing excellence Budget 2010-11. Partial withdrawal of stimulus measures may from Frost & Sullivan. result in increase in Inflation and expected to be around 6%. The interest rate for automobile loans may expect to increase 50 to B. Quality 100 basis points in FY11. The quality system at the factory aims at achieving total customer satisfaction through its focus on improving Since, major growth is expected from Exports as well as from product quality to World standards. This is achieved new systems; new product launch at the right time will be the through total employee involvement and continuous focus area. Suitable measures have been factored in the company's improvement culture. Rigorous usage of poka-yokes, operating plan. The OEM customers across the world would utilization of statistical tools for process optimization continue their pressure on price reduction from their suppliers. and control also contribute towards improving the product The Company plans to mitigate this risk through cost reduction quality. initiatives such as value engineering and global sourcing. The standardization of the quality procedures is aligned with QS 9000 / TS 16949 requirements. WTIL is certified V. Internal control system and their adequacy for TS 16949. The Company has a proper and adequate system of internal TQM is a way of life at WTIL. 100% participation in controls to ensure that all assets are safeguarded and protected employee involvement has been successful for the past against loss from unauthorized use or disposition thereof. All 11 consecutive years. transactions are authorized, recorded and reported correctly. The Employees have completed more than 229 projects by internal controls are checked by internal auditors. The observations applying statistical tools through QC Circles in 2009- made by them, management action and time frame is reviewed 10. The average number of suggestions implemented by the audit committee of the Board of Directors. Concerns per employee is 57 in 2009-10 which is close to if any are reported to the Board. international benchmark. 8


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    C. Cost management IX. Community development and social responsibility The Company continues its rigorous focus on its costs As a corporate citizen, the Company believes in its social through an effective cost deployment system. Value responsibility and community development activities. Activities engineering and global sourcing projects are being in which the company will carry out activities in this regard will pursued for cost reduction and also to insulate from cost escalation. Commodity sourcing from prime dealers and be identified and action will be taken thereof. price indexing with customers will help in managing the X. Financial statement cost effectively and efficiently. Particulars Year ended Year ended D. Information Technology 31st March 2010 31st March 2009 The Company uses ERP system that integrates all business processes across the Company as well as Rs. in lakhs % Rs. in lakhs % dealers and suppliers. During the year, the Company Sales 59,125.80 97.1 42,594.58 95.6 has focused on further leveraging the ERP system. Other income 1,821.02 2.9 1,983.20 4.4 VII. Human Resource Development Total income 60,946.82 100.0 44,577.78 100.0 The Company focuses on attracting the best talent and enjoys Raw materials a good brand image across leading educational institutions consumed 33,024.05 54.2 24,617.78 55.2 and job seekers. The Company blends successfully mid career recruitment with internally grown talent through talent Staff cost 5,443.02 8.9 5,025.30 11.3 management process. A reward and recognition system is Stores & tools in place to provide fast track growth for high potential consumed 2,157.83 3.5 1,624.65 3.6 employees. Career development workshops are undertaken to identify such high potential. Power & fuel 988.97 1.6 736.58 1.7 Executives are sponsored to overseas and inland universities Repairs & for developing their capabilities to handle new technologies maintenance 685.55 1.1 508.60 1.1 and management practices. Customised management Other expenses 5080.31 8.4 4,730.76 10.6 development programs have been developed with reputed Interest-net 289.41 0.5 685.42 1.6 educational institutions to hone the leadership skills of the senior executives. Depreciation 1,444.49 2.4 1,393.21 3.1 People are encouraged to take up higher responsibilities and Total expenditure 49,113.63 80.6 39,322.30 88.2 stretch assignments from the very early stages of their Profit before tax 11,833.19 19.4 5,255.48 11.8 career. Periodic job rotations help the employees to get a Provision for broad perspective to assume leadership roles in future. taxation The Company continues to maintain its impeccable record Current tax 4,050.00 6.6 1,575.00 3.5 on industrial relations. Fringe benefits tax – – 51.94 0.1 As of 31st March 2010, the Company had 1,026 employees on its rolls. Deferred tax (75.36) (0.1) 76.33 0.2 Profit after tax 7,858.55 12.9 3,552.21 8.0 VIII. Environment & Safety Safety management is integrated with the overall environment, XI. Cautionary statement health and safety (EHS) management system. WTIL have Statements in the management discussion and analysis report been certified for ISO 14001 systems. describing the Company's objectives, projections, estimates and The Company is committed to energy conservation. During expectations may be "forward looking statements" within the the year the following implemented projects have gained momentum: meaning of applicable securities laws and regulations. Actual Timer controls for various air handling systems results could differ materially from those expressed or implied. Optimizing air pressure setting Important factors that could make a difference to the Company's Power saving through optimized usage of air operations include, among others, economic conditions affecting compressors demand / supply and price conditions in the domestic and overseas Introduction of variable frequency drives (VFD) for markets in which the Company operates, changes in the motors Government regulations, tax laws and other statutes and Use of energy efficient lighting systems incidental factors. 9


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    REPORT ON CORPORATE GOVERNANCE 1. Company's philosophy on code of governance and also as a whole-time director of the Company subject The Company believes in transparency, professionalism and to such terms and conditions as approved by the shareholders accountability, which are the basic principles of Corporate at the annual general meeting held on 24th September 2009. Governance. The Company would constantly endeavour to improve Chairman is a director and not related to any promoter of on these aspects. the Company as defined under clause 49 of the Listing Agreement. 2. Board of directors The number of independent directors is one third of its total 2.1 Composition and category of directors: strength. Thus, the Company meets with the requirements As of 31st March 2010, the total strength of the board of of composition of the board as per the Listing Agreement. directors (the board) is nine directors. All the directors 2.2 Board Meetings: except the whole-time director are non-executive directors. The Company, in consultation with the directors, prepares Out of the eight non-executive directors, three directors viz., and circulates a tentative annual calendar for the meetings M/s Venu Srinivasan, D E Udwadia and Narayan K Seshadri of the committees / board in order to assist the directors are independent directors. for planning their schedules to participate in the meetings. As reported in last year's Report on Corporate Governance, During the year 2009-10, the board met 5 times on 27th Mr H Lakshmanan and Vice Admiral Mr P J Jacob (Retd), April 2009, 30th July 2009, 27th August 2009, 21st October ceased to be directors of the Company effective 30th July 2009 and 19th January 2010 and the gap between two 2009; Mr Trevor Lucas and Mr Kurt Lehmann were appointed meetings did not exceed four months. as additional and non-independent directors of the Company effective 30th July 2009 and appointed as directors at the 2.3 Attendance and other directorships: annual general meeting held on 24th September 2009; Mr The details of attendance of the directors at the board C N Prasad resigned as whole-time director effective 17th meetings, during the year, and at the last annual general June 2009, but continues to be a non-independent director meeting held on 24th September 2009 and also the number of the Company; Mr P Kaniappan was appointed as an of other directorships and committee memberships / additional director of the Company effective 17th June 2009 chairmanships as on 31st March 2010 are as follows: Attendance Number of directorships and particulars committee member / chairmanships Name of the director M/s. Category Board Last Other Committee Committee meeting AGM directorships* memberships** chairmanships Venu Srinivasan C-I 5 No 17 3 1 P Kaniappan WTD-NI 4 Yes – – – C N Prasad NE-NI 5 Yes 5 7 – Narayan K Seshadri NE-I 5 Yes 11 2 2 D E Udwadia NE-I 5 Yes 21 8 2 Nikhil Madhukar Varty NE-NI 1 No 3 – – Leon Liu NE-NI 2 No 10 – – Trevor Lucas NE-NI 1 Yes 10 – – Kurt Lehmann NE-NI 2 Yes – – – * includes private companies. ** includes committees where the director is also chairman. C-I : Chairman - Independent WTD : Whole-time Director - Non Independent NE-I : Non executive - Independent director NE-NI : Non executive - Non-independent director 10


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    None of the directors is a member in more than 10 board disclosures and transparency, integrity and quality of financial level committees or chairman of more than 5 such committees, reporting. as required under clause 49 of the listing agreement. 3.1 Brief description of terms of reference: 2.4 Access to information and Updation to directors: The Audit Committee of the Company is entrusted with the The board reviews all information provided periodically for responsibility to supervise the Company's internal control discussion and consideration at its meetings in terms of and financial reporting process and inter-alia performs the clause 49 of the Listing Agreement. following functions: Functional heads are present whenever necessary and a. Overseeing the Company's financial reporting process apprise all the directors about the developments. They also and the disclosure of financial information. make presentations to the board and audit committee of b. Reviewing with the management quarterly and annual directors. financial statements before submission to the board for Apart from this, the observations of audit carried out by the approval with particular reference to the matters specified internal auditors and the compliance report on payment of in the Listing Agreement. statutory liabilities submitted by the statutory auditors of the c. Reviewing the related party transactions. Company are placed and discussed with functional heads. d. Reviewing the reports of internal auditors and ensuring The board also reviews the declarations made by the whole- that adequate follow-up action is taken by the time director and secretary of the Company regarding management on observations and recommendations compliance of all applicable laws on quarterly basis. made by the internal auditors. 2.5 Code of Business Conduct and Ethics for board and senior e. Recommending to the board the appointment / re- management personnel: appointment / replacement of the statutory auditors and The Company has in place the Code of Business Conduct the fees payable for audit and for other services rendered and Ethics for Board and Senior Management personnel (the by the statutory auditors. Code) approved by the board. The Code has been f. Reviewing with the management, the performance of communicated to directors and the members of the senior statutory and internal auditors. management. The Code has also been displayed on the g. Reviewing with the management, external and internal Company's website www.wabco-tvs.com. auditors, the adequacy of internal control systems. All the board members and senior management personnel h. Reviewing the adequacy of internal audit functions and have affirmed compliance with the Code for the year ended systems, structure, reporting process, audit coverage 31st March 2010. The annual report contains a declaration and frequency of internal audit. to this effect signed by the whole-time director and general i. Discussion with external auditors regarding audit plan manager (finance) and secretary of the Company as as well as post-audit discussion to ascertain any area compliance officer for the Code. of concern. 2.6 Appointment of directors: j. Ascertainment of reasons for substantial defaults in the In terms of clause 49(IV)(G) of the Listing Agreement with payment to creditors and in case of payment of declared the Stock Exchanges, a brief resume of directors, proposed dividends to the shareholders. to be re-appointed, nature of their expertise in specific k. Review of management discussion analysis of financial functional areas, their other directorships and committee conditions and results of operations and other matters memberships, their shareholdings and their relationships specified under clause 49 of the Listing Agreement. with other directors are provided in the notice convening l. Review of financial statements, in particular the the ensuing annual general meeting of the Company. investments made by the unlisted subsidiary. 3. Audit Committee m. In addition, review of such other functions as envisaged The primary objective of the Audit Committee is to monitor and under Section 292A of the Companies Act, 1956 and provide effective supervision of the management's financial reporting Clause 49 of the Listing Agreement with Stock process with a view to ensure accurate, timely and proper Exchanges. 11


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    3.2 Composition, name of members and the chairman of the The transactions with the related parties, namely its promoters, Audit Committee: its subsidiary and associate companies etc., are of routine nature have been reported elsewhere in the annual report The Audit Committee was reconstituted consequent to the as per Accounting Standard 18 (AS 18) issued by The changes in the board. As of date, the Audit Committee Institute of Chartered Accountants of India. consists of the following directors: The Audit Committee is briefed, inter alia, on the following Name of the directors - aspects: Status (M/s) (i) the related party transactions undertaken by the Narayan K Seshadri Non-executive, Company in the ordinary course of business (summary); Independent director (ii) material individual transactions, if any, which were not D E Udwadia Non-executive, in the normal course of business; and Independent director (iii) material individual transactions, if any, with related C N Prasad Non-executive, parties or others, which were not at arm's length basis. Non-Independent director 4.2 Disclosure of accounting treatment: Mr Narayan K Seshadri, independent director, is the Chairman The Company follows the Accounting Standards issued by of the Audit Committee. Mr R Madhavan, general manager the Institute of Chartered Accountants of India and Company (finance) and secretary of the Company acts as the Secretary (Accounting Standards) Rules, 2006. of the Audit Committee. 4.3 Risk Management: Chairman of the Audit Committee was present at the annual The Company has laid down procedures to inform Board general meeting held on 24th September 2009. The members about the risk assessment and minimization composition of the committee is in accordance with the procedures. These procedures are periodically reviewed to requirements of Clause 49 of the Listing Agreement and ensure that executive management controls risk through Section 292A of the Companies Act, 1956. means of a properly defined framework. 3.3 The particulars of meetings and attendance by the members 4.4 Instances of non-compliances, if any: of the committee during the year under review are given There were no instances of non-compliances by the Company, in the table below: penalties and strictures imposed on the Company by the Stock Exchanges or SEBI or any other statutory authorities Date of the Members present on any matter related to the capital markets during the last meeting M/s three years. 25th April 2009 Vice Admiral P J Jacob (*), H Lakshmanan (*), 4.5 Disclosure by senior management personnel: Narayan K Seshadri and D E Udwadia The senior management personnel have made disclosure 30th July 2009 Narayan K Seshadri, to the board relating to all material, financial and other D E Udwadia and C N Prasad transactions stating that they did not have personal interest 27th August 2009 Narayan K Seshadri, that could result in a conflict with the interest of the Company D E Udwadia and C N Prasad at large 21st October 2009 Narayan K Seshadri, 4.6 CEO and CFO Certification: D E Udwadia and C N Prasad The whole-time director (CEO) and Chief Financial Officer 18th January 2010 Narayan K Seshadri, of the Company have certified to the board on financial and D E Udwadia and C N Prasad other matters in accordance with Clause 49(V) of the Listing (*) resigned effective 30th July 2009 Agreement pertaining to CEO/CFO certification for the financial year ended 31st March 2010. 4. Disclosures 4.7 Compliance with mandatory / non-mandatory requirements: 4.1 Materially significant related party transactions: The Company has complied with all applicable mandatory During the year, the Company has not entered into any requirements in terms of clause 49 of the Listing Agreement. transaction of material nature with the directors, their relatives The non-mandatory requirements have been adopted to the or management which is in conflict with the interests of the extent and in the manner as stated under the appropriate Company. headings detailed elsewhere in this report. 12


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    4.8 Management discussion and analysis report: 5.4 Details of shareholdings of non-executive directors in the The management discussion and analysis report has been Company as on 31st March 2010: attached to the directors' report. None of the directors of the Company holds any share in 5. Remuneration Committee the Company. There are no other particular pecuniary The board has not constituted a remuneration committee, as the relationships or transactions of the non-executive directors' need for forming such committee has not arisen. The remuneration vis-à-vis of the Company. None of the directors is related to the whole-time director was decided by the board of directors to each other. subject to the approval of the shareholders. 5.5 Particulars of remuneration paid to the whole-time director 5.1 Remuneration to directors: during the financial year 2009-2010: Mr P Kaniappan, director of the Company, was appointed (Rs.in lakhs) as a whole-time director of the Company for a period of Name of the Contribution Perquisites five years effective 17th June 2009 on a remuneration director Salary to PF and & Total consisting salary and other perquisites in terms of the (M/s.) other funds Allowances agreement entered into between him and the Company on 17th June 2009. Mr C N Prasad resigned as whole-time P Kaniappan @ 38.08 4.02 19.63 61.73 director from 17th June 2009. However he continues to be C N Prasad # 11.80 0.87 7.38 20.05 the director in the board. @ remuneration for the period from 17th June 2009 to The remuneration payable to the whole-time director is fixed 31st March 2010 by the board within the limits approved by the shareholders # remuneration for the period from 1st April 2009 to in terms of the relevant provisions of the Companies Act, 1956. 17th June 2009. The non-executive directors do not draw any remuneration from the Company other than sitting fees for attending each 5.6 Presently, the Company does not have a scheme for grant meeting of the board and committees thereof. of any stock option either to the executive directors or The Company has enhanced the payment of sitting fees employees. from Rs.7,500/- to Rs.15,000/- to all the non-executive 6. Investors' grievance committee: directors for attending each meeting of the board and/or committee thereof which is within the limits prescribed under 6.1 As on 31st March 2010, the investors' grievance committee the Companies Act, 1956, as approved by the board at its consisted of three members, viz., Mr Narayan K Seshadri, meeting held on 19th January 2010. chairman, Mr C N Prasad, director and Mr P Kaniappan, M/s Nikhil Madhukar Varty, Leon Liu, Trevor Lucas, Kurt whole-time director of the Company. The Committee met Lehmann, directors, representing the promoters, namely four times during the year. M/s Clayton Dewandre Holdings Limited waived the sitting 6.2 As required by Securities and Exchange Board of India fees payable to them. The board also accepted their request (SEBI), Mr R Madhavan, general manager (finance) and for waiver at their meeting held on 19th January 2010. secretary of the Company has been appointed as the 5.3 Particulars of sitting fees paid to non-executive directors compliance officer. For any clarification/complaint, the during the financial year 2009-2010: shareholders may contact Mr R Madhavan, general manager Name of the non-executive directors Sitting fee (finance) and secretary of the Company. M/s. (Rs.) Venu Srinivasan 52,500 6.3 The committee oversees and reviews all matters connected with share transfers, issue of duplicate share certificates and C N Prasad 82,500 other issues pertaining to shares. The committee also looks Narayan K Seshadri 97,500 into the redressal of investors' grievances pertaining to D E Udwadia 97,500 transfer of shares, non-receipt of balance sheet, non-receipt H Lakshmanan 30,000 of declared dividends, etc. The Company, as a matter of Vice Admiral P J Jacob (Retd.) 15,000 policy, disposes investor complaints within a span of Total 3,75,000 seven days. 13


  • Page 15

    6.4 Complaints received and redressed during the year the shareholders was obtained for the change of name 2009-10: of the Company under Section 21 and other applicable provisions, if any, of the Companies Act, 1956 from No. of S.No. Nature of complaint the then Auto (India) Engineering Limited to WABCO- complaints TVS (INDIA) Limited. 1 Non receipt of share certificates 2 (b) In pursuance of the order of the Hon'ble High Court 2 Non receipt of dividend warrants 5 of Madras , the meeting of the shareholders was 3 Non receipt of annual reports 2 convened on 22nd October 2007 for approving the 4 Other complaints 1 Scheme of Arrangement made between the Company Total 10 (Resulting Company) and Sundaram-Clayton Limited 6.5. All the complaints were resolved and, as on 31st March (Demerged Company) and their respective shareholders 2010, no complaint was pending. All requests for and creditors under Sections 391 - 394 of the Companies dematerialization of shares were carried out within the Act, 1956. The said Scheme of Arrangement was stipulated time period. approved by the shareholders unanimously and the result of the poll is given as follows: 6.6 Secretarial Audit A qualified practising company secretary carried out secretarial Total Votes Votes % of % of audit on a quarterly basis to reconcile the total admitted Number of cast Against votes cast votes cast capital with National Securities Depository Limited (NSDL) Valid Votes In favour in favour in against and Central Depository Services (India) Limited (CDSL) and 1,00,000 1,00,000 -- 100% -- the total issued and listed capital and placed the report for perusal of the Board. The secretarial audit report confirms The Hon'ble High Court of Madras vide its order dated that the total issued and listed capital is in agreement with 20th February 2008 sanctioned the said Scheme of the total number of shares in physical form and the total Arrangement. The said order was filed with the Registrar number of shares in dematerialized form held with NSDL of Companies, Tamil Nadu, Chennai on 28th March and CDSL. 2008 and the Scheme became effective on 28th March 2008. 7. General body meeting: (c) At the Extraordinary General meeting of the Shareholders 7.1 Location and time where the annual general meetings were of the Company held on 17th March 2008, consent / held during the last three years. approval of the shareholders was obtained for the Year Location Date Time following: 2006-2007 Registered Office: 28.09.2007 9.15 A.M. i. Authorization to make investments in securities or No.29 Haddows Road to provide loan or give guarantee upto a limit of Chennai 600 006 Rs.200 crores more than the limits in terms of 2007-2008 The Music Academy, 29.09.2008 10.15 A.M. Section 372A of the Companies Act, 1956. New No.168, ii. Approval for keeping and maintaining books, returns T T K Road and documents at a place other than the Registered (Mowbrays Road), office of the Company in terms of Section 163 of Chennai 600 014 the Companies Act, 1956. 2008-2009 Sathgurugnananda Hall, 24.09.2009 10.15 A.M. iii. Approval for adopting the new set of articles of Narada Gana Sabha Trust, association of the Company in terms of Section 31 No.314, (Old No.254), TTK Road, and other applicable provisions of the Companies Chennai 600 018 Act, 1956. iv. Approval for amendments to the main objects of 7.2 Special resolutions passed in the previous three annual the memorandum of association and the new set general meetings: of Articles of Association of the Company under (a) At the extraordinary general meeting of the Shareholders Section 31 and other applicable provisions of the of the Company held on 19th April 2007, approval of Companies Act, 1956. 14


  • Page 16

    (d) At the annual general meeting of the Shareholders of 9.3 Date of book closure : 21st August 2010 to the Company held on 24th September 2009, consent/ 26th August 2010 approval of the shareholders was obtained for alteration (both days inclusive) to certain clauses of Articles of Association of the 9.4 Particulars of dividend payment Company under Section 31 and other applicable provisions of the Companies Act, 1956. An interim dividend of Rs.2.50 per share for the year ended 31st March 2009 was paid to the shareholders 7.3 None of the subjects placed before the shareholders in the on 19th December 2008 and no further dividend was last / ensuing annual general meeting required/requires recommended for the year ended 31st March 2009. approval by a postal ballot. The board of directors has recommended a dividend of 8. Means of communication Rs.2.50 per share for the year 2009-2010, absorbing a sum 8.1 Quarterly results: of Rs.474.20 lakhs, for approval of the shareholders in the The unaudited quarterly financial results of the Company ensuing annual general meeting. were published in the English and vernacular newspapers. 9.5 Listing on Stock Exchanges: These are not sent individually to the shareholders. Name of the stock exchange Stock code 8.2 Newspapers wherein results normally published: Madras Stock Exchange Ltd (MSE) – The results are normally being published in the English Bombay Stock Exchange Ltd (BSE) 533023 newspapers, namely "The Hindu" and "The Economic Times" and the Tamil version in a Tamil daily viz., "Dinamani". National Stock Exchange of India Ltd. (NSE) WABCO-TVS 8.3 Website: ISIN allotted by depositories INE342J01019 The Company has in place a web site addressed as (Company ID Number) www.wabco-tvs.com. The unaudited results and the quarterly distribution schedules as filed with the Stock Exchanges are (Note: Annual listing fees for the year 2010-2011 have been published in Company website. The Company makes use duly paid to the above stock exchanges) of its website for publishing official news releases and 9.6 Market Price Data: presentations, if any, made to institutional investors / analysts. Bombay Stock Exchange National Stock Exchange 9. General shareholder information Limited (BSE) (in Rs) of India Ltd. (NSE) (in Rs) 9.1 Annual general meeting: Month Month's Month's Month's Month's Date and time : 26th August 2010 at 10.00 a.m. high price low price high price low price Venue : "Sathguru Gnanananda Hall", April 2009 165.00 127.55 164.00 127.00 Narada Gana Sabha Trust, May 2009 210.00 135.00 207.90 136.15 No.314 (Old No.254) T.T.K Road, Chennai 600 018 June 2009 290.00 185.75 274.30 181.70 9.2 Financial year : 1st April to 31st March July 2009 286.10 205.00 286.75 201.25 Financial calendar August 2009 385.00 280.00 389.00 275.10 2010-11 (Tentative) : September 2009 407.95 315.05 408.00 310.00 Financial reporting for the quarter ending : Financial calendar October 2009 460.00 366.30 501.00 363.05 th st 30th June 2010 : between 15 to 31 July 2010 November 2009 500.00 421.00 485.00 409.00 th st 30th September 2010 : between 15 to 31 October 2010 December 2009 549.95 455.10 555.00 453.00 th st 31st December 2010 : between 15 to 31 January 2011 January 2010 730.00 450.00 729.95 508.00 st th 31st March 2011 : between 1 to 15 May 2011 February 2010 763.60 636.10 769.80 630.20 Annual general Meeting March 2010 794.00 675.15 790.00 670.00 (next year) : August / September 2011 15


  • Page 17

    9.7 Share transfer agents (STA) and share transfer system: 9.8 Shareholding pattern as on 31st March 2010: a. With a view to rendering prompt and efficient service Particulars No. of % to to the investors, M/s Sundaram-Clayton Limited (SCL), shares held total which has been registered with SEBI as the Share (a) Shareholding of Promoter and Transfer Agent (STA) in Category II, has been appointed Promoter Group as the STA of the Company. (1) Indian - Bodies Corporate – – The shareholders have also been advised about this (2) Foreign- Bodies Corporate 1,42,25,684 75.00 appointment of STA to handle share registry work pertaining to both physical and electronic segments of Total Shareholding of Promoter the Company. and promoter Group (A) 1,42,25,684 75.00 b. All matters connected with the share transfer, both (b) Public Shareholding physical and electronic, dividends and other matters are 1. Institutions handled by the STA located at the address mentioned (a) Mutual Funds 21,43,667 11.30 elsewhere in this report. (b) Banks, Financial Institutions, c. Shares lodged for transfer will be processed within 10 Insurance Companies days from the date of lodgement, if the documents are (Central, State Government clear in all respects. All requests for dematerialization Institutions, Non-Govt. Institutions) 402 0.00 of securities are processed and the confirmation will be given to the depositories within 7 days. Grievances (c) Foreign Institutional Investors 72,266 0.38 received from investors and other miscellaneous Sub Total Institutions 22,16,335 11.68 correspondence on change of address, mandates etc 2. Non - Institutions will be processed by the STA within 7 days. a) Bodies Corporate 3,59,347 1.90 d. Pursuant to clause 47(c) of the Listing Agreement with b) Individuals <1 lakh 18,23,512 9.61 Stock Exchanges, certificates, on half-yearly basis, will c) Individuals >1 lakh 3,21,222 1.70 be issued by a Company Secretary-in-practice for due d) NRI - Repatriable 13,027 0.07 compliance of share transfer formalities by the Company. e) NRI - Non-Repatriable 8,457 0.04 e. Pursuant to SEBI (Depositories and Participants) Sub Total Non-Institutions 25,25,565 13.32 Regulations, 1996, certificates from a Company Total (B) 47,41,900 25.00 Secretary-in-practice for timely dematerialization of the shares of the Company and for conducting a secretarial Grand Total (A) +(B) 1,89,67,584 100.00 audit on a quarterly basis for reconciliation of the share 9.9 Distribution of Shareholding as on 31st March 2010: capital of the Company will be obtained. Shareholding No. of % No. of % f. The Company, as required under clause 47(f) of the (Range) Shares Members Listing Agreement, has designated the following e-mail Upto 5,000 18,38,603 9.69 16,461 99.73 IDs, namely investorscomplaintssta@scl.co.in (share transfer agent) / madhavan.rajagopalan@wabco-tvs.co.in 5,001-10,000 1,16,874 0.62 17 0.10 (compliance officer) for the purpose of registering 10,001-20,000 93,475 0.49 6 0.04 complaints, if any, by the investors and expeditious redressal of their grievances. 20,001-50,000 2,95,886 1.56 9 0.05 g. The shareholders are, therefore, requested to correspond 50,001-1,00,000 2,95,798 1.56 4 0.03 with the STA at the address mentioned elsewhere in 1,00,001 & above 1,63,26,948 86.08 9 0.05 this report for any change of names and queries Total 1,89,67,584 100.00 16,506 100.00 pertaining to the shareholding and dividends etc. 16


  • Page 18

    9.10 Dematerialization of shares and liquidity: 9.13 Address for investors Correspondence: Out of 47,41,900 shares held by persons other than (i) For transfer / dematerialisation of Sundaram-Clayton Limited promoters, 43,61,716 shares have been dematerialised shares, payment of dividend on share transfer department as on 31st March 2010 accounting for 91.98%. shares and any other query New No.22, Old No.31 relating to the shares of the Railway Colony, 3rd 9.11 The Company has not issued any Global Depository Company. Street, Mehta Nagar, Receipt / American Depository Receipt / Warrant or any Chennai 600 029. convertible instrument, which is likely to have impact (ii) for any query on non-receipt Tel : 044 2374 1889, on the Company's equity. of annual report; and 044 4224 2000, (iii) for investors grievance & 044 2374 2939 9.12 Plant locations : general correspondence F a x: 044 2374 1889, Factories : 044 4224 2009 Email : Plot No. 3 (SP), III Main Road, kr.raman@scl.co.in Ambattur Industrial Estate, sclshares@gmail.com Chennai 600 058 investorscomplaintssta@scl.co.in Tel : 044 4224 2000 madhavan.rajagopalan@wabco-tvs.co.in Fax : 044 4224 2009 10. Non-mandatory disclosure: Large Sector, Adityapur Industrial Area, The non-mandatory requirements have been adopted to the Gamharia, Seraikella-Kharsawan District, extent and in the manner as stated under the appropriate Jharkhand 832 108 headings detailed below: Tel : 0657 661 6800 10.1 The Board: Fax : 0657 238 7997 Both executive and non-executive directors of the Company are liable to retire by rotation and if eligible, Plot No. AA8, Central Avenue, offer themselves for re-appointment. No specific tenure Auto Ancillary SEZ, Mahindra World City, has been fixed for the independent directors. Natham Sub-Post, Chengalpet, 10.2 Remuneration committee: Kancheepuram District 603 002 Tel : 044 4744 2000 The board has not set up a remuneration committee, Fax : 044 4749 0006 as the need for the same has not arisen. 10.3 Shareholder rights: Software Design Centre: The half-yearly results of the Company will be published "Ispahani Centre", 7th Floor, in English and vernacular newspapers and are also 123/124 Nungambakkam High Road, displayed on the Company's website, namely Chennai 600 034 www.wabco-tvs.com The results are not sent to the Tel : 044-2828 5000 shareholders individually. Fax : 044-2833 2212 10.4 Audit Qualifications: Module No - 1107, D Block, The statutory financial statements of the Company are 11th Floor Tidel Park, unqualified. No.4, Rajiv Gandhi Salai 10.5 Training of board members / Mechanism for evaluating Taramani, Chennai 600 113 non-executive directors: Tel : 044 2254 5700 The present board consists of well-experienced and Fax : 044 2254 0909 responsible members of society. All the directors are 17


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    well aware of business model as well as the risk profile Shareholders are requested to note that as per SEBI circular of the business parameters of the Company and their no. MRD/DoP/Cir -05/1009 dated 20th May 2009, it is responsibilities as directors. Hence, in the opinion of mandatory for transferees to furnish a copy of Permanent the board, they do not require any further training. There is also no specific mechanism for evaluating the Account Number (PAN) for registration of transfer of shares performance of the non-executive directors of the to be held in physical mode Company. In case of loss / misplacement of share certificates, 10.6 Whistle blower policy: Shareholders should immediately lodge a FIR / Complaint The Company has not adopted whistle blower policy. with the police and inform the Company / STA with original However, the Company has not denied access to any or certified copy of FIR / acknowledged copy of complaint personnel to approach the management on any issue. for marking stop transfer of shares. 11. Request to shareholders: Consolidation of Multiple Folios: Shareholders are requested to follow the general safeguards / Shareholders, who have multiple folios in identical names, procedures as detailed hereunder in order to serve them efficiently are requested to apply for consolidation of such folios and and avoid risks while dealing in securities of the Company. send the relevant share certificates to the Company. Change of registered office: Registration of Nominations: Shareholders are requested to note the change of registered office Nomination in respect of shares - Section 109A of the of the Company from the present address i.e "Jayalakshmi Estates", Companies Act, 1956 provides facility for making nominations No.29, Haddows Road, Chennai 600 006 to the factory premises by shareholders in respect of their holding of shares. Such located at Plot No 3 (SP) III Main Road, Ambattur Industrial nomination greatly facilitates transmission of shares from the Estate, Chennai 600 058, effective 1st April 2010, within the deceased shareholder to his / her nominee without having "postal limits" of Chennai City. Shareholders have already been to go through the process of obtaining succession certificate notified about the change of registered office by way of a circular / probate of the Will etc. dated 22nd March 2010. It would therefore be in the best interests of the shareholders Demat of Shares: holding shares in physical form registered as a sole holder to Shareholders are requested to convert their physical holding to make such nominations. Investors, who have not availed nomination demat/ electronic form through any of the depository participants facility, are requested to avail the same by submitting the nomination (DPs) to avoid any possibility of loss, mutilation etc. of physical in form 2B. This form will be made available on request. Investors share certificates and also to ensure safe and speedy transaction holding shares in demat form are advised to contact their DP's in securities. for making nominations. Registration of Electronic Clearing Service (ECS) Mandate: Updation of address: ECS helps in quick remittance of dividend without possible loss/ Shareholders are requested to update their address registered delay in postal transit. Shareholders, who have not earlier availed with the Company, directly through the STA located at the address this facility, are requested to register their ECS details with the mentioned above, to receive all communications promptly. STA or their respective DPs. Shareholders, holding shares in electronic form, are requested Transfer of shares in physical mode: to deal only with their depository participant (DP) in respect of Shareholders should fill in complete and correct particulars in the change of address and furnishing bank account number, etc. transfer deed, for expeditious transfer of shares. Wherever SMS Alerts: applicable, registration number of power of attorney should also Investors are requested to note that National Securities Depository be quoted in the transfer deed at the appropriate place. Limited (NSDL) and Central Depository Services (India) Limited Shareholders, whose signatures have undergone any change over (CDSL) have announced the launch of SMS alert facility for a period of time, are requested to lodge their new specimen demat account holders whereby investors will receive alerts signature duly attested by a bank manager to the STA. for debits / credits (transfers) to their demat accounts a day 18


  • Page 20

    after the transaction. These alerts will be sent to those Shareholders who have not encashed their dividend warrants account holders who have provided their mobile numbers to in respect of dividends declared for the year ended 31st their Depository participants (DPs). March, 2008 and for any financial year thereafter may contact the Company and surrender their warrants for payment. No charge will be levied by NSDL / CDSL on DPs providing Shareholders are requested to note that the dividend not this facility to investors. This facility will be available to claimed for a period of seven years from the date they first investors who request for the same and provide their mobile became due for payment shall be transferred to "Investors numbers to the DPs. Further information is available on the Education and Protection Fund" (IEPF) terms of Section website of NSDL and CDSL namely www.nsdl.co.in and 205C of the Companies Act, 1956. Shareholders are requested www.cdslindia.com, respectively. to note that as per the Companies Act, 1956, unclaimed Timely encashment of dividends: dividends once transferred to IEPF will not be refunded. Shareholders are requested to encash their dividends Information in respect of unclaimed dividends due for promptly to avoid hassles of revalidation/ losing your right remittance into IEPF is given below: of claim owing to transfer of unclaimed dividends beyond PARTICULARS OF UNCLAIMED DIVIDEND seven years to Investor Education and Protection Fund. Financial Date of Date of transfer to Date of transfer As required by SEBI, shareholders are requested to furnish year Declaration special account to IEPF details of their bank account number and name and address of the bank for incorporating the same in the warrants. This 2007-08 20.08.2008 25.09.2008 25.09.2015 (2nd interim) would avoid wrong credits being obtained by unauthorized persons. 2008-09 08.12.2008 13.01.2009 13.01.2016 (1st Interim) Declaration pursuant to clause 49 of the listing agreement regarding adherence to the Code of Business Conduct and Ethics The Shareholders of the Company WABCO-TVS (INDIA) Limited On the basis of the written representations received from Members of the Board and Senior Management Personnel in terms of the relevant provision of clause 49 of the Listing Agreement, we hereby certify that both the members of the board and the senior management personnel of the Company have affirmed compliance with the respective provisions of the Code of Business Conduct and Ethics of the Company as laid down by the board of directors for the year ended 31st March 2010. Chennai P Kaniappan R Madhavan th 4 May 2010 Whole-time Director Secretary 19


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    Auditors’ Certificate on compliance of the provisions of the code of Corporate Governance in the listing agreement. To The shareholders of WABCO-TVS (INDIA) Limited We have examined the compliance of conditions of corporate governance by WABCO-TVS (INDIA) Limited, Chennai 600 058 for the year ended 31st March 2010, as stipulated in Clause 49 of the Listing Agreement of the said Company with Stock Exchanges. The compliance of conditions of Corporate Governance is the responsibility of Company's management. Our examination was limited to procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of the Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company. In our opinion and to the best of our information and according to the explanations given to us, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the abovementioned Listing Agreement. We state that no investor grievances are pending for a period exceeding one month against the Company as per the records maintained by the Investors' Grievances Committee. We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company. For SUNDARAM & SRINIVASAN Chartered Accountants Registration No. 004207S M BALASUBRAMANIYAM Chennai Partner th 4 May 2010 Membership No. F7945 20


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    Auditors’ report to the Shareholders We have audited the attached balance sheet of M/s.WABCO-TVS (INDIA) (iv) in our opinion, the balance sheet, profit and loss account Limited, Chennai 600 058 as at 31st March 2010, the profit and loss and the cash flow statement dealt with by this report comply account and the cash flow statement for the year ended on that date with the accounting standards, referred to in sub-section both annexed thereto. These financial statements are the responsibility (3C) of section 211 of the Companies Act, 1956; of the company's management. Our responsibility is to express an opinion on these financial statements based on our audit. (v) on the basis of written representations received from the directors, as on 31st March 2010 and taken on record by 1. We conducted our audit in accordance with auditing standards the board of directors, we report that no director is disqualified generally accepted in India. These standards require that we from being appointed as a director of the company in terms plan and perform the audit to obtain reasonable assurance about of clause (g) of sub-section (1) of section 274 of the whether the financial statements are free of material misstatement. Companies Act, 1956 on the said date; An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit (vi) in our opinion and to the best of our information and also includes assessing the accounting principles used and according to the explanations given to us, the said accounts significant estimates made by management, as well as evaluating read together with the notes thereon give the information the overall presentation of the financial statements. We believe required by the Companies Act, 1956, in the manner so that our audit provides a reasonable basis for our opinion. required and give a true and fair view in conformity with 2. As required by the Companies (Auditor's Report) Order, 2003 and the accounting principles generally accepted in India; amended by the Companies (Auditor's report) (Amendment) Order, a. in so far as it relates to the balance sheet, of the state 2004 issued by the Central Government in terms of sub-section of affairs of the company as at 31st March 2010; (4A) of section 227 of the Companies Act, 1956, we enclose in the annexure a statement on the matters specified in paragraphs b. in so far as it relates to the profit and loss account, 4 and 5 of the said Order. of the profit of the company for the year ended on that 3. Further to our comments in the annexure referred to above, we date; and state that - c. in so far as it relates to the cash flow statement, of (i) we have obtained all the information and explanations, which the cash flows for the year ended on that date. to the best of our knowledge and belief, were necessary for the purpose of our audit; For SUNDARAM & SRINIVASAN (ii) in our opinion, proper books of account, as required by law, Chartered Accountants have been kept by the company so far as appears from Registration No. 004207S our examination of those books; (iii) the balance sheet and profit and loss account and cash M BALASUBRAMANIYAM flow statement, dealt with by this report, are in agreement Chennai Partner th with the books of account; 4 May 2010 Membership No. F7945 21


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    Auditors’ report to the Shareholders (Contd.) Annexure referred to in our report of even date on the accounts for the year ended 31st March 2010. (i) (a) The company has maintained proper records showing full (vi) The company has not accepted any deposit from the public. particulars including quantitative details and situation of fixed (vii) The company has an internal audit system which, in our opinion, assets; is commensurate with the size and nature of its business. (b) All the assets have not been physically verified by the (viii) We have broadly reviewed the books of account maintained by management during the year but there is a regular programme the company pursuant to the rules made by the Central Government of verification at reasonable intervals, which, in our opinion, under Section 209 (1)(d) of the Companies Act, 1956 for is reasonable having regard to the size of the company and maintenance of cost records and are of the opinion that, prima the nature of its assets. No material discrepancies were facie, the prescribed accounts and records have been made and noticed on such verification; maintained. (c) The assets disposed off during the year are not substantial (ix) (a) According to the records provided to us, the company is and therefore do not affect the going concern status of the regular in depositing undisputed statutory dues including company. Provident Fund, Employees' State Insurance, Income tax, (ii) (a) The inventory including those with third parties, other than Sales tax, Wealth tax, Customs duty, Excise duty, Service in-transit have been physically verified at reasonable intervals tax, Cess and other statutory dues with the appropriate during the year by the management. In our opinion the authorities. The requirement as to depositing into Investors frequency of such verification is adequate. Education & Protection Fund with appropriate authorities (b) In our opinion and according to the information and does not arise in this year. explanations given to us, the procedures for physical (b) According to the information and explanations given to us, verification of inventory followed by the management were no undisputed amounts payable in respect of Income tax, reasonable and adequate in relation to the size of the Wealth tax, Sales tax, Customs duty, Excise duty, Service company and the nature of its business; tax and cess were in arrears as at 31st March 2010 for (c) In our opinion, the company has maintained proper records a period of more than six months from the date they became of inventory. The discrepancies between the physical stocks payable. and the book stocks were not material and have been (c) According to the information and explanations given to us, properly dealt with in the books of account. the following are the details of the disputed dues, that were (iii) During the year, the company has not granted or taken any loan, not deposited with the concerned authorities. secured or unsecured to or from companies, firms or other parties Amout Forum where covered in the register maintained under section 301 of the Nature of Statute Nature of due (Rs. in lakhs) the dispute is Companies Act, 1956. pending (iv) In our opinion and according to the information and explanations Customs Act, 1962 Customs duty 5.17 Commissioner of given to us, there are adequate internal control procedures Customs (Appeals), Chennai commensurate with the size of the company and the nature of its business with regard to purchase of inventory, fixed assets Income Tax Act Income tax 93.34 Commissioner of and for the sale of goods and services. During the course of 1961 Asst. year Income Tax 2007-08 (Appeals), Chennai our audit, no major weakness has been noticed in the internal control system. Central Excise Excise duty- 11.11 Commissioner of Act 1944 cenvat credit Central Excise (v) (a) Based on the audit procedures applied by us and according reversal (Appeals), Chennai to the information and explanations provided by the Service Tax Reversal of 4.72 Commissioner of management, we are of the opinion that the contracts or Service tax Central Excise arrangement that need to be entered in the register maintained credit on (Appeals), Chennai in pursuance of Section 301 of the Companies Act, 1956 certain inputs have been properly entered in the said register; (b) In our opinion and according to the information and (x) The company has no accumulated losses as at the end of the explanations given to us, the transactions entered in the financial year and has not incurred cash losses during the financial register maintained under Section 301 and exceeding during year and in the immediately preceding year. the year by rupees five lakhs in respect of each party have (xi) Based on our verification and according to the information and been made at prices which are reasonable having regard explanations given by the management, the company has not to prevailing market prices at the relevant time. defaulted in repayment of dues to any bank. 22


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    Auditors’ report to the Shareholders (Contd.) Annexure referred to in our report of even date on the accounts for the year ended 31st March 2010. (xii) Based on our examination and according to the information and (xviii) During the year, the company has not allotted any shares explanations given to us, the company has not granted loans and on preferential basis to parties and companies covered in advances on the basis of security by way of pledge of shares, the register maintained under section 301 of the Companies Act, 1956. debentures and other securities. (xix) During the year, the company has not issued any secured (xiii) The company is not a chit / nidhi / mutual benefit fund / society debentures. and as such clause (xiii) of the Order is not applicable; (xx) During the year, the company has not raised any money by public (xiv) The company is not dealing or trading in shares, securities, issue. debentures and other investments, other than mutual fund (xxi) Based on the audit procedures adopted and information and instruments. explanations given to us by the management, no fraud on or by the (xv) During the year, there are no guarantees given by the company company has been noticed or reported during the course of our audit. for loans taken by others. For SUNDARAM & SRINIVASAN (xvi) During the year, the company has utilized rupee term loan availed Chartered Accountants in 2008-09 for the purpose for which the loan was obtained. Registration No. 004207S (xvii) On the basis of our examination, the company has not used funds M BALASUBRAMANIYAM raised on short term basis for long term investment. Chennai Partner th 4 May 2010 Membership No. F7945 23


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    Balance Sheet as at 31st March 2010 (Rupees in lakhs) Schedule As at As at number 31.03.2010 31.03.2009 I. SOURCE OF FUNDS 1. Shareholders’ funds a) Capital I 948.38 948.38 b) Reserves and surplus II 26,083.52 18,817.52 27,031.90 19,765.90 2. Loans a) Secured loans III 719.23 5,520.44 b) Unsecured loans IV – 500.00 719.23 6,020.44 3. Deferred taxation (net) V 324.57 399.93 28,075.70 26,186.27 II. APPLICATION OF FUNDS 1. Fixed Assets VI a) Gross block 26,478.94 26,327.37 b) Less : Depreciation including impairment 8,462.91 7,187.80 c) Net block 18,016.03 19,139.57 d) Capital work-in-progress 661.31 388.37 2. Investments VII 220.24 900.69 3. Current assets, loans and advances a) Inventories VIII 4,606.75 4,630.40 b) Sundry debtors IX 13,143.15 7,026.03 c) Cash & bank balances X 238.28 127.91 d) Other current assets XI 4.55 8.86 e) Loans & advances XII 1,973.69 1,092.26 (a) 19,966.42 12,885.46 Less: current liabilities and provisions a) Current liabilities XIII 8,610.26 5,357.60 b) Provisions XIV 2,178.04 1,770.22 (b) 10,788.30 7,127.82 Net current assets (a)-(b) 9,178.12 5,757.64 28,075.70 26,186.27 VENU SRINIVASAN P KANIAPPAN As per our report annexed Chairman Whole-time Director For SUNDARAM & SRINIVASAN Chartered Accountants Chennai R MADHAVAN T S RAJAGOPALAN M BALASUBRAMANIYAM 4th May, 2010 General Manager (Finance) and Secretary Chief Financial Officer Membership No. F 7945 Partner 24


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    Profit & Loss Account for the year ended 31st March 2010 (Rupees in lakhs) Schedule Year ended Year ended number 31.03.2010 31.03.2009 Sales (Gross) 64,123.40 48,303.53 Less: Excise duty 4,997.60 5,708.95 Sales (Net) 59,125.80 42,594.58 Other Income XV 1,821.02 1,983.20 a 60,946.82 44,577.78 Materials consumed XVI 33,024.05 24,617.78 Salaries & wages, stores consumed and other expenses XVII 14,355.68 12,625.89 b 47,379.73 37,243.67 Profit before Interest depreciation and tax c (a-b) 13,567.09 7,334.11 Interest (net) 289.41 685.42 Depreciation 1,444.49 1,393.21 d 1,733.90 2,078.63 Profit before tax e (c-d) 11,833.19 5,255.48 Provision - for Income tax 4,050.00 1,575.00 - for Fringe Benefit tax – 51.94 - for Deferred tax (75.36) 76.33 f 3,974.64 1,703.27 Profit for the year (after tax) g (e-f) 7,858.55 3,552.21 Balance profit (loss) brought forward 5,156.52 2,515.10 Profit (loss) for the year (after tax) 7,858.55 3,552.21 Total 13,015.07 6,067.31 Tax relating to earlier years 39.59 – Interim dividend paid – 474.20 Dividend tax paid – 80.59 Proposed dividend 474.20 – Dividend Tax payable 78.76 – Transfer to general reserve 785.86 356.00 Balance carried to Balance Sheet 11,636.66 5,156.52 Total 13,015.07 6,067.31 Notes on accounts XVIII Nominal value of each share in rupees 5.00 5.00 Basic earnings per share in rupees on 1,89,67,584 shares 41.43 18.73 Diluted earnings per share in rupees 41.43 18.73 VENU SRINIVASAN P KANIAPPAN As per our report annexed Chairman Whole-time Director For SUNDARAM & SRINIVASAN Chartered Accountants Chennai R MADHAVAN T S RAJAGOPALAN M BALASUBRAMANIYAM 4th May, 2010 General Manager (Finance) and Secretary Chief Financial Officer Membership No. F 7945 Partner 25


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    Schedules (Rupees in lakhs) As at As at 31.03.2010 31.03.2009 I. SHARE CAPITAL Authorised 2,00,00,000 Equity Shares of Rs. 5/- each 1,000.00 1,000.00 Issued, subscribed and paid-up 1,89,67,584 Equity Shares of Rs. 5/- each fully paid up. 948.38 948.38 a) Pursuant to the scheme of demerger of Brakes division in to the company from Sundaram-Clayton Limited, Chennai,(SCL) the shareholders of SCL are entitled for allotment of 1,89,67,584 equity shares of Rs 5/- each fully paid up for consideration other than in cash. b) These shares are deemed to be issued, subscribed and fully paid up in terms of the scheme of arrangement. These shares were allotted on 7th May 2008. c) On 3rd June 2009, M/s Clayton Dewandre Holdings Limited, Rotterdam, The Netherlands(CDH) acquired 67,95,684 equity shares of Rs 5/- each fully paid up in the company. Consequently the aggregate number of equity shares held in the company stood at 1,42,25,684 equity shares. Thus the company became a subsidiary of CDH on and from the above date. II. RESERVES AND SURPLUS Capital reorganisation reserve As per last Balance Sheet 5.00 5.00 General reserve As per last Balance Sheet 13,656.00 13,300.00 Add: Transferred from Profit & Loss Account 785.86 14,441.86 356.00 13,656.00 Surplus Balance in Profit & Loss account 11,636.66 5,156.52 26,083.52 18,817.52 III. SECURED LOANS From banks Secured by hypothecation of raw materials, components, work-in-process, finished goods, book debts, stores, spares and tools 719.23 3,520.44 Secured by hypothecation of specific plant and machinery – 2,000.00 719.23 5,520.44 IV. UNSECURED LOANS From bank-short term – 500.00 26


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    Schedules (continued) (Rupees in lakhs) As at As at 31.03.2010 31.03.2009 V. DEFERRED TAXATION (NET) Deferred tax liabilities Tax on - i) Depreciation 833.70 594.18 ii) Provision for doubtful debts 17.31 851.01 (22.95) 571.23 Less : Deferred tax assets i) Employee related schemes 162.76 16.92 ii) Warranty 37.82 19.91 iii) Expenses relating to earlier years 7.20 76.95 iv) Others 318.66 57.52 526.44 171.30 324.57 399.93 VI. FIXED ASSETS (Rupees in Lakhs) Description Land Lease Buildings Plant & Furniture, Vehicles Others Total as at hold Machinery, Fixtures & Fixed Land Dies & Jigs Equipments Assets 31.03.2010 31.03.2009 @ Cost of assets As at 01.04.2009 1,556.81 356.87 5,510.82 17,104.07 1,327.91 168.15 302.74 26,327.37 22,787.46 Additions – – 23.24 486.79 126.70 56.21 20.46 713.40 3,560.64 Less: sales/transfer – – – 524.54 36.83 0.46 – 561.83 20.73 Total 1,556.81 356.87 5,534.06 17,066.32 1,417.78 223.90 323.20 26,478.94 26,327.37 Depreciation Upto 31.03.2009 – 18.99 500.29 5,625.36 693.32 75.11 274.73 7,187.80 5,811.88 For the year – 6.09 180.38 1,084.91 117.01 18.09 38.01 1,444.49 1,393.21 Deductions on sales/transfer – – – 135.29 33.65 0.44 – 169.38 17.29 Total – 25.08 680.67 6,574.98 776.68 92.76 312.74 8,462.91 7,187.80 Written down value As at 31.03.2010 1,556.81 331.79 4,853.39 10,491.34 641.10 131.14 10.46 18,016.03 – As at 31.03.2009 1,556.81 337.88 5,010.53 11,478.71 634.59 93.04 28.01 – 19,139.57 @ vide note no XVIII (z) regarding Intangible Assets under Accounting standards 26 CAPITAL WORK-IN-PROGRESS (at cost) Buildings 269.18 250.67 Electrical equipment 19.81 1.79 Machinery in transit / installation 372.32 135.91 661.31 388.37 27


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    Schedules (continued) (Rupees in lakhs) Face As at As at VII. INVESTMENTS (AT COST) Value 31.03.2010 31.03.2009 1. Non-trade-Unquoted (fully paid up) - Long term ICICI Prudential Life Insurance Group Superannuation Fund Mumbai 220.24 220.24 220.24 2. Non-trade-quoted (fully paid up) - Short term 53,982.865 units in last year in UTI Mutual Fund of UTI Asset Management Company Private Limited, Mumbai - UTI Treasury Advantage Fund – – 634.45 (institutional plan - growth option) 3. Non-trade-quoted (fully paid up) - Long term 4,60,000 units in last year SBI Mutual Fund of State Bank of India, Mumbai - SBI One India Fund - Dividend option – – 46.00 220.24 900.69 SUMMARY Quoted Investments – 680.45 Unquoted Investments 220.24 220.24 220.24 900.69 Short term – 634.45 Long term 220.24 266.24 220.24 900.69 Market value of quoted investments – 660.65 VIII. INVENTORIES Raw materials and components* 3,069.74 3,340.75 Work-in-process* 198.61 135.35 Finished goods* 926.27 542.47 Stores* 290.08 216.45 Goods in transit 122.05 395.38 4,606.75 4,630.40 * As certified by whole-time director; at lower of weighted average cost or net realisable value as prescribed in Accounting Standard 2 issued by The Institute of Chartered Accountants of India IX. SUNDRY DEBTORS-UNSECURED, CONSIDERED GOOD a) Debts outstanding for a period exceeding six months - Considered good – – - Considered doubtful 124.50 242.92 Total 124.50 242.92 b) Other debts 13,143.15 7,026.03 Less: Provision for bad and doubtful debts 124.50 242.92 13,143.15 7,026.03 X. CASH AND BANK BALANCES a) Cash and cheques on hand 9.38 9.19 b) With scheduled banks - current accounts 228.90 118.72 238.28 127.91 XI. OTHER CURRENT ASSETS Interest accrued on investments and deposits 4.55 8.86 4.55 8.86 XII. LOANS AND ADVANCES-UNSECURED, CONSIDERED GOOD a) Advances recoverable in cash or in kind or for value to be received 1,585.97 896.25 b) Advance payment of income tax less provisions 204.91 – c) Advance payment of fringe benefit tax less provisions – 0.19 d) Deposits 182.81 195.82 1,973.69 1,092.26 28


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    Schedules (continued) (Rupees in lakhs) As at As at 31.03.2010 31.03.2009 XIII. CURRENT LIABILITIES Sundry creditors 8,610.26 5,357.60 8,610.26 5,357.60 XIV. PROVISIONS a) Proposed dividend 474.20 – b) Dividend tax payable 78.76 – c ) Pension 697.40 615.72 d) Leave salary 198.61 162.47 e) Warranty 726.51 773.58 f) Provision for income tax less advance payments – 217.60 g) Provision for fringe benefit tax less advance payments 2.56 – h) Others – 0.85 2,178.04 1,770.22 Year ended Year ended 31.03.2010 31.03.2009 XV. OTHER INCOME a) Sale of scrap and empties 374.31 305.95 b) Profit on sale of assets 4.46 3.86 c ) Profit on sale of investments 31.51 46.82 d) Software service export 997.74 1,041.40 e) Test track service usage 159.31 159.43 f) R & D Service export 87.43 373.40 g) Tool development income (net of expenses) 165.82 49.33 h) Dividend income 0.44 2.38 i ) Miscellaneous income – 0.63 1,821.02 1,983.20 XVI. MATERIALS CONSUMED Opening stock : Raw materials 3,340.75 2,082.02 Work-in-process 135.35 119.29 Finished goods 542.47 364.99 4,018.57 2,566.30 Add : Purchases 33,200.10 26,070.05 Total (a) 37,218.67 28,636.35 Less : Closing stock Raw materials 3,069.74 3,340.75 Work-in-process 198.61 135.35 Finished goods 926.27 542.47 Total (b) 4,194.62 4,018.57 Net (a)-(b) 33,024.05 24,617.78 29


  • Page 31

    Schedules (continued) (Rupees in lakhs) Year ended Year ended 31.03.2010 31.03.2009 XVII. SALARIES & WAGES, STORES CONSUMED AND OTHER EXPENSES Salaries, wages and bonus (includes Rs. 76.68 lakhs to wholetime directors) (last year Rs. 83.36 lakhs) 4,508.00 4,180.81 Stores and tools consumed 2,157.83 1,624.65 Contribution to provident and other funds (includes Rs. 4.89 lakhs to wholetime directors) (last year Rs. 4.39 lakhs) 403.30 362.23 Power and fuel 988.97 736.58 Workmen and staff welfare expenses (includes Rs. 0.21 lakhs to wholetime directors) (last year Rs. 0.14 lakhs) 531.72 482.26 Rent 139.54 129.17 Rates and taxes 63.93 105.59 Repairs and maintenance a) Building 300.98 204.07 b) Machinery 349.49 272.33 c) Other assets 35.08 32.20 Insurance 21.28 49.95 Commission 23.81 55.19 Audit fees 20.12 18.49 Cash discount 32.12 31.31 Travel and conveyance 486.73 449.39 Packing and forwarding 2,195.15 1,356.76 Data processing 108.25 69.53 Sitting fees to directors 3.75 4.65 Research and development 471.74 314.32 Other expenses 1,473.76 2,113.69 Loss on sale of investments – 30.15 Loss on sale / scrapping of assets 40.13 2.57 14,355.68 12,625.89 30


  • Page 32

    Schedules (continued) XVIII. NOTES ON ACCOUNTS (Rupees in lakhs) As at/ As at/ Year ended Year ended 31.03.2010 31.03.2009 1. Accounting Standards a) AS - 1 Disclosure of Accounting policies The accounts are maintained on accrual basis as a going concern. b) AS - 2 Valuation of Inventories Inventories are valued in accordance with the method of valuation prescribed by The Institute of Chartered Accountants of India at lower of weighted average cost or net realisable value. c) AS - 3 Cash Flow Statement Cash flow statement is prepared under “Indirect Method” and the same is annexed. d) AS - 4 Contingencies and events occurring after balance sheet date Nil Nil e) AS - 5 Net Profit or Loss for the period, Prior Period Items and Changes in Accounting Policies Rates and Taxes – 21.19 f) AS - 6 Depreciation Accounting Depreciation has been provided under the straight line method at the rates prescribed under schedule XIV of the Companies Act, 1956 with applicable shift allowance. In respect of the assets added / sold during the year, pro-rata depreciation has been provided. Depreciation in respect of computers and vehicles has been provided @30% and 18% respectively which is higher than the rate prescribed in schedule XIV of the Companies Act, 1956. Depreciation in respect of assets acquired during the year whose actual cost does not exceed Rs. 5,000/- has been provided at 100%. g) AS - 7 Construction contracts This accounting standard is not applicable. h) AS - 8 Research and Development This accounting standard is withdrawn. i) AS - 9 Revenue Recognition The income of the company is derived from sale of air brake equipment, parts and accessories thereof net of trade discount, tool development income and software services and includes realised exchange fluctuation on exports amounting to Rs 173.58 lakhs (last year Rs 111.90 lakhs). Interest income is recognised on a time proportion basis taking into account the amount outstanding and rate applicable. The revenue and expenditure are accounted on a going concern basis. j) AS - 10 Accounting for Fixed Assets All the fixed assets are valued at cost including expenditure incurred in bringing them to usable condition as reduced by Central Value Added Tax (CENVAT) credit less depreciation. k) AS - 11 Accounting for effects in Foreign exchange rates a) Foreign Currency transactions Income and expenses in foreign currencies are converted at exchange rates prevailing on the date of the transaction. Foreign currency monetary assets and liabilites are translated at the exchange rate prevailing on the balance sheet date. Exchange differences arising out of such translation are recognised in the Profit and Loss Account. b) Net exchange differences debited (last year credited) to Profit and Loss Account - purchase of raw materials and components 17.28 30.87 31 WABCO-TVS (India) Limited 21.07.2010 31 to 48.p65 31 7/22/2010, 6:40 PM


  • Page 33

    Schedules (continued) XVIII. NOTES ON ACCOUNTS (continued) (Rupees in lakhs) As at/ As at/ Year ended Year ended 31.03.2010 31.03.2009 c) Foreign currency exposures The year end foreign currency exposures that have not been hedged by a derivative instrument or otherwise are given below: Sl.No Description Value in Foreign Currency Value in Indian Rupees in Millions in lakhs 2010 2009 2010 2009 1 Import of goods and services USD 0.07 0.03 33.28 15.54 Euro 0.23 0.36 139.83 242.62 Total 173.11 258.16 2 Export of goods & services USD 1.46 0.82 659.04 417.77 EURO 1.84 1.09 1,114.30 733.48 Total 1,773.34 1,151.25 l) AS - 12 Accounting for Government grants The Company has not received any grants from the Government. m) AS - 13 Accounting for Investments Investments are valued at cost. Provision for diminution in the carrying cost of long term investments is made if such dimunitions is other than temporary in nature in the opinion of the management. (i) Investments made during the year SBI Funds Management Private Limited, Mumbai 3,200.00 – UTI Asset Management Company Private Limited, Mumbai 7,644.77 634.45 DSP Merril Lynch Investment Managers Limited, Mumbai – 50.00 Lotus India Asset Management Company Private Limited, Mumbai – 50.00 Total 10,844.77 734.45 (ii) Investments realised during the year SBI Funds Management Private Limited, Mumbai 3,246.00 – UTI Asset Management Company Private Limited, Mumbai 8,279.22 – 6.75% Tax Free Bonds in Unit Trust of India, Mumbai – 599.54 DSP Merril Lynch Investment Managers Limited, Mumbai – 50.00 Lotus India Asset Management Company Private Limited, Mumbai – 50.00 Total 11,525.22 699.54 (The amounts of Rs. 10,844.77 lakhs (last year 734.45) and Rs. 11,525.22 lakhs (last year 699.54) are cumulative figures) Cost of investments held as at balance sheet date 220.24 900.69 n) AS - 14 Accounting for Amalgamation During the year there was no amalgamation. 32 WABCO-TVS (India) Limited 21.07.2010 31 to 48.p65 32 7/22/2010, 6:40 PM


  • Page 34

    Schedules (continued) XVIII. NOTES ON ACCOUNTS (continued) o) AS - 15 Accounting for Retirement Benefits Disclosure is made as per the requirements of the standard and the same is furnished below: A Defined contribution plans (a) Contribution to provident fund is in the nature of defined contribution plan and are made to a recognised trust. The company has discontinued contribution to superannuation fund. B Defined benefit plans (a) The company extends defined benefit plans in the form of leave salary to employees. In addition, the company also extends pension to senior managers of the company. Provision for leave salary and pension is made on actuarial valuation basis. (b) The company also extends defined benefit plan in the form of gratuity to employees. Contribution to gratuity is made to Life Insurance Corporation of India in accordance with the scheme framed by the Corporation. C Disclosure as required by Accounting Standard 15 (Rupees in lakhs) Leave salary Pension Gratuity (a) Expenses recognised in the Profit & Loss Account i) Current service cost 25.60 – 44.84 ii) Interest cost 13.14 52.35 47.25 iii) Expected return on plan assets – – (53.82) iv) Net actuarial loss / (gain) recognised in the year 13.45 29.32 36.69 Total 52.19 81.67 74.96 (b) Change in defined benefit obligation during the year ended 31st March 2010 i) Present value of obligation as at beginning of the year (01.04.2009) 162.47 615.72 590.67 ii) Interest cost 13.14 52.35 47.25 iii) Current service cost 25.61 – 44.84 iv) Benefits paid (16.05) – (150.07) v) Actuarial loss on obligation 13.44 29.32 36.70 vi) Present value of obligation as at the end of the year (31.03.2010) 198.61 697.39 569.39 (c) Change in fair value of plan assets during the year ended 31st March 2010 i) Fair value of plan assets at the beginning of the year (01.04.2009) – – 669.87 ii) Expected return on plan assets – – 53.82 iii) Contributions made during the year – – – iv) Benefits paid – – (150.07) v) Actuarial gain on plan assets – – – vi) Fair value of plan assets as at the end of the year 31.03.2010 – – 573.62 33 WABCO-TVS (India) Limited 21.07.2010 31 to 48.p65 33 7/22/2010, 6:40 PM


  • Page 35

    Schedules (continued) XVIII. NOTES ON ACCOUNTS (continued) (Rupees in lakhs) (d) Balance Sheet movements i) Value of benefit obligations / (net assets) at the beginning of the year (01.04.2009) 162.47 615.72 669.87 ii) Actual return on plan assets – – 53.82 iii) Contributions made during the year – – – iv) Expenses 52.19 81.67 – v) Benefits paid (16.05) – (150.07) vi) Value of benefit – – – vii) Fair value of plan assets as at the end of the year 31.03.2010 198.61 697.39 573.62 Funded Status 4.22 The net asset in respect of gratuity plan is not recognised as it is lying in an irrecoverable trust fund approved by Income tax authorities. (e) Actuarial assumptions i) Discount rate used 9.00% 9.50% 8.00% ii) Expected return on plan assets NA NA 8.00% Estimates of future salary increase considered in actuarial valuation taking into account the inflation, seniority and other relevant factors. p) AS - 16 Borrowing Cost The borrowing cost has been treated in accordance with Accounting Standard on borrowing cost (AS 16) issued by The Institute of Chartered Accountants of India. During the year, there were no borrowings attributable to qualifying assets and hence no borrowing costs were capitalised. q) AS - 17 Segment Reporting The company operates in only one segment viz., Automotive Components and there are no separate reportable segments . As the income from software services division is less than 10% of total income, it is not recognised as a separate segment. r) AS - 18 Related Party Disclosure Disclosures are made as per the requirements of the standard and clarifications issued by The Institute of Chartered Accountants of India. s) AS - 19 Accounting of leases As the company has not entered in to any lease agreement during the year, this standard is not applicable. t) AS - 20 Earnings Per Share (EPS) Disclosure is made in the Profit and Loss Account as per the requirements of the standard. u) AS - 21 Consolidated Financial Statements Not applicable as the company has no subsidiary. v) AS - 22 Accounting for Taxes on Income Current tax is determined as the amount of tax payable in respect of taxable income for the period. 34 WABCO-TVS (India) Limited 21.07.2010 31 to 48.p65 34 7/22/2010, 6:40 PM


  • Page 36

    Schedules (continued) XVIII. NOTES ON ACCOUNTS (continued) (Rupees in lakhs) As at/ As at/ Year ended Year ended 31.03.2010 31.03.2009 Deferred tax liability and asset are recognised, subject to the consideration of prudence, on timing differences using the tax rates substantively enacted on the Balance Sheet date. w) AS - 23 Accounting for Investments in Associates in Consolidated Financial Statements Not applicable as the company has no shareholding/control in any associates. x) AS - 24 Discontinuing Operations Not applicable as the company has not discontinued any operations during the year. y) AS - 25 Interim Financial Reporting The company has elected to publish quarterly financial results which were subject to limited review by the statutory auditors. z) AS - 26 Intangible Assets During the year, the company acquired the following assets falling under the definition of intangible assets as per the Accounting Standard and the following disclosure is made in respect of those assets : Licences & Software : - Useful life of the assets 2 years 2 years - Amortisation rate used 50% each year 50% each year as depreciation as depreciation - Gross carrying amounts at the beginning and at the end of the period together with additions and deletions during the year Opening balance 302.74 247.34 Additions during the year 20.46 55.40 Total (A) 323.20 302.74 Amortisation Opening balance 274.73 218.33 During the year 38.01 56.40 Total amortisation (B) 312.74 274.73 Closing balance (A – B) 10.46 28.01 aa) AS - 27 Financial Reporting of Interests in Joint Ventures The company has no interest in any joint venture. ab ) AS - 28 Impairment of Assets During the year 2009-2010, the carrying amount of the assets net of accumulated depreciation as on the balance sheet date is not less than the recoverable amount of those assets. 35 WABCO-TVS (India) Limited 21.07.2010 31 to 48.p65 35 7/22/2010, 6:40 PM


  • Page 37

    Schedules (continued) XVIII. NOTES ON ACCOUNTS (continued) (Rupees in lakhs) As at/ As at/ Year ended Year ended 31.03.2010 31.03.2009 ac) AS - 29 Provisions, contingent liabilities and contingent assets i) Provisions In respect of warranty obligations, provision is made in accordance with terms of sale vide Schedule XIV to Balance Sheet ii) Contingent liabilities Amount for which the company is contingently liable is disclosed in note 6. iii) Contingent assets Contingent assets which are likely to give rise to possibility of inflow of economic benefits - Nil iv) Contested liabilities are detailed in note 6. 2. Amount of loan repayable within one year: a) Secured - from banks 719.23 3,895.44 b) Unsecured - from banks – 500.00 3. Sundry creditors include: a) Total outstanding dues to Micro and Small enterprises 360.93 220.05 b) Total outstanding dues to creditors other than Micro and Small enterprises 5,080.20 2,510.98 The above dues are furnished based on the information available with the company in respect of Micro, Small and Medium Enterprises (as defined in the Micro, Small and Medium Enterprises Development Act, 2006). The company is regular in making payments of dues to such enterprises before due dates agreed upon. Hence the question of payment/provision of interest towards belated payments does not arise. c) Investor Education and Protection Fund Unclaimed dividend 6.99 7.39 4. Bank balance include: Unclaimed dividend 6.99 7.39 5. Loans and Advances include: - Amount lying with central excise 30.00 5.00 - Amount due from an officer of the company 1.74 1.81 - Maximum amount due from an officer of the company at any time during the year 1.81 1.91 6. Liability not provided for: a) Contingent liabilities i. On counter guarantee given to bankers 1.80 59.03 ii.On letters of credit opened with bankers 15.05 18.61 iii. Capital commitments not provided 308.12 82.93 iv.On account of future export obligations (under Export Promotion 327.43 1,913.23 Capital Goods scheme and Advance Licence) v. Bills discounted 7,470.49 2,966.48 36 WABCO-TVS (India) Limited 21.07.2010 31 to 48.p65 36 7/22/2010, 6:40 PM


  • Page 38

    Schedules (continued) XVIII. NOTES ON ACCOUNTS (continued) (Rupees in lakhs) As at/ As at/ Year ended Year ended 31.03.2010 31.03.2009 b) Contested liabilities i. Customs duty 5.17 5.17 ii. Excise duty 11.11 – iii. Income tax 93.34 – iv. Service tax 4.72 – 7. Tax deducted at source on a) Interest receipts 1.25 0.71 b) Miscellaneous income 5.64 11.48 8. Audit fees consists of a) Audit fees 12.00 12.00 b) Certification fees 1.00 2.00 c) Taxation matters 2.00 2.00 d) Reimbursement of expenses 3.37 1.99 e) Other services 1.75 0.50 9. Contribution to provident and other funds include : a) Contribution towards gratuity as per scheme framed by Life Insurance Corporation of India 38.98 4.20 b) Contribution to pension fund 143.21 147.19 c) Contribution towards deposit linked insurance as per scheme framed by Life Insurance Corporation of India 4.18 3.83 10. Repairs include Stores consumed 26.61 19.74 11. Interest paid comprises of: a) Interest on fixed loans 95.63 134.30 b) Interest on others 200.45 570.65 c) Less: Interest receipts on Bonds, deposits, staff advances and other advance made (gross) 6.67 19.53 Interest (net of income) 289.41 685.42 12. Expenses in excess of 1% of the total revenue Fees paid for management services – 685.22 (In this year the fees paid is less than 1% of total revenue) 13. Research and development Revenue Expenditure 867.17 561.95 Capital Expenditure a. Land and buildings – 23.82 b. Other than land & buildings 108.06 108.34 14. Previous year's figures have been regrouped wherever necessary to conform to current year's classification. 37 WABCO-TVS (India) Limited 21.07.2010 31 to 48.p65 37 7/22/2010, 6:40 PM


  • Page 39

    Schedules (continued) XVIII. NOTES ON ACCOUNTS (continued) 15. Related party disclosure LIST OF RELATED PARTIES a) Reporting entity WABCO-TVS (INDIA) Limited b) Subsidiary companies The reporting entity does not have any subsidiary company. c) Associate companies Sundaram Industries Limited, Madurai Southern Roadways Limited, Madurai T V Sundram Iyengar & Sons Limited, Madurai Clayton Dewandre Holdings Limited, Rotterdam, The Netherlands ceased to be associate companies with effect from 3rd June 2009 consequent to the disposal of 35.83% of the shares held in the reporting entity to Clayton Dewandre Holdings Limited, RotterDam,The Netherlands The Reporting entity became a subsidiary of Clayton Dewandre Holdings Limited, (CDH) Rotterdam, The Netherlands with effect from 3rd June 2009 consequent to the purchase of 35.83% shares. d) Holding company Clayton Dewandre Holdings Limited, Rotterdam, The Netherlands (became a holding Company of this company from 3rd June 2009. e) Ultimate holding company WABCO Holdings Inc., USA f) Fellow Subsidiary companies 1 WABCO Fahrzeugsysteme GmbH, Germany 2 WABCO China Co Ltd, China 3 WABCO France SAS, France 4 Meritor WABCO Vehicle Control Systems, USA 5 Shandong Weiming Automotive Product Co. Ltd, China 6 WABCO (Shanghai) Management Co Limited, China 7 WABCO Automotive SouthAfrica 8 WABCO Automotive UK Ltd, United Kingdom 9 WABCO Australia Pty Limited, Australia 10 WABCO Compressor Manufacturing Co. USA 11 WABCO Hong Kong Limited, Hong Kong 12 WABCO Japan Inc, Japan 13 WABCO Korea Ltd, Korea 14 WABCO Polska Sp. z.o.o, Poland 15 WABCO Development GmbH, Germany 16 WABCO Logistics GmbH, Germany 17 WABCO Asia Private Limted, Singapore 18 WABCO Europe BVBA, Belgium 19 WABCO Austria GesmbH, Austria 20 WABCO Belgium BVBA SPRL, Belgium 21 WABCO do Brasil Industria e Comercio de Freios Ltda., Brazil 38 WABCO-TVS (India) Limited 21.07.2010 31 to 48.p65 38 7/22/2010, 6:40 PM


  • Page 40

    Schedules (continued) XVIII. NOTES ON ACCOUNTS (continued) 22 WABCO Brzdy K Vozidlum spol S.R.O, Czeh Republic 23 WABCO GmbH, Germany 24 WABCO Radbremsen GmbH, Germany 25 WABCO Automotive Italia SRL, Italy 26 WABCO BV, Netherlands 27 WABCO Europe Holdings BV, Netherlands 28 WABCO Espana SLU, Spain 29 WABCO Automotive AB, Sweden 30 WABCO (Schweiz) GmbH, Switzerland 31 WABCO Automotive B.V, Netherlands 32 WABCO ARAC Kontrols Sistemleri Destek VE Pazarlama Limited Sirketi , Turkey 33 WABCO Middle East and Africa FZCO, Dubai 34 WABCO Centro de Distribuicao de Pecas Automotivas Ltda, Brazil g) Key management personnel Mr C N Prasad - Whole Time Director till 17.06.2009 Mr P Kaniappan - Whole Time Director from 17.06.2009 16. Related party transactions (Rupees in lakhs) Key Management Associate Fellow Subsidiary Sl. Nature of Personnel Name of the company No. transactions Year ended Year ended Year Ended 31.03.2010@ 31.03.2009 31.03.2010 31.03.2009 31.03.2010 31.03.2009 1 Purchase of goods Sundaram Industries Limited, Madurai 113.29 816.64 – – – – Shandong Weiming Automotive Product Co. Ltd, China – – 19.12 2.87 – – WABCO Fahrzeugsysteme GmbH, Germany – – 1,354.24 1443.05 – – WABCO do Brasil Industria e Comercio de Freios Ltda., Brazil – – 32.19 1.80 – – WABCO France S.A.S, France – – 151.79 98.35 – – WABCO China Co Ltd – – 85.12 540.97 – – WABCO Compressor Manufacturing Co, USA – – 10.87 0.69 – – 113.29 816.64 1,653.33 2,087.73 – – 2 Receiving of services Southern Roadways Limited, Madurai 0.20 42.14 – – – – T.V.Sundram Iyengar & Sons Limited ,Madurai – 0.97 – – – – WABCO (Shanghai) Management Co., Limited, China – – – 61.38 – – 0.20 43.11 – 61.38 – – 3 Sale of goods T V Sundram Iyengar & Sons Limited, Madurai. 641.29 946.10 – – – – Meritor WABCO Vehicle Control Systems, USA – – 118.24 191.27 – – WABCO Logistics GmbH, Germany – – 413.22 938.31 – – WABCO China Co Ltd, China – – 2,038.91 1,080.92 – – WABCO Automotive, SouthAfrica – – 11.62 10.01 – – WABCO Compressor Manufacturing Co USA – – 1,964.75 879.52 – – WABCO Polska sp.z.o.o, Poland – – 291.84 162.47 – – WABCO Automotive UK Ltd, United Kingdom – – 359.13 205.82 – – WABCO Korea Ltd, Korea – – 22.02 – – – 39 WABCO-TVS (India) Limited 21.07.2010 31 to 48.p65 39 7/22/2010, 6:40 PM


  • Page 41

    Schedules (continued) XVIII. NOTES ON ACCOUNTS (continued) (Rupees in lakhs) Key Management Associate Fellow Subsidiary Sl. Nature of Personnel Name of the company No. transactions Year ended Year ended Year Ended 31.03.2010@ 31.03.2009 31.03.2010 31.03.2009 31.03.2010 31.03.2009 WABCO France S.A.S, France – – 4.71 – – – WABCO do Brasil Industria e Comercio.de Freios Ltda, Brazil – – 17.08 – – – Shandong Weiming Automotive Product Co. Ltd, China – – 118.72 – – – WABCO GmbH, Germany – – 71.50 – – – WABCO Asia Private Ltd,, Singapore – – 22.72 – – – WABCO Middle-East & Africa FZCO, Dubai – – 1.66 – – – WABCO Development GmbH,Germany – – 1.21 – – – WABCO Europe BVBA, Belgium – – 225.69 – – – 641.29 946.10 5,683.03 3,468.32 – – 4 Rendering of Services Software and R & D service WABCO Development Gmbh, Germany – – 1,058.18 1,356.29 – – R & D Service WABCO France S.A.S, France – – 39.62 – – – R & D Service WABCO Do Brasil Industria e Comercio de Freios Ltda, Brazil – – 0.24 – – – R & D Service WABCO Polska sp.z.o.o, Poland – – 2.87 – – – – – 1,100.92 1,356.29 – – 5 Sale of fixed assets WABCO China Co Ltd, China – – 383.55 – – – 6 Receivables as on T V Sundram Iyengar & Sons Limited, Madurai. – 174.71 – – – – 31.03.2010 WABCO Logistics GmbH, Germany – – 258.86 202.34 – – WABCO China Co Ltd, China – – 577.67 328.21 – – WABCO Automotive UK Ltd, United Kigdom – – 74.04 120.78 – – Meritor WABCO Vehicle Control Systems, USA – – 22.49 22.38 – – WABCO Development GmbH, Germany – – 202.37 322.88 – – WABCO Compressor Manufacturing Co. USA – – 60.19 120.94 – – Shandong Weiming Automotive Product Co. Ltd, China – – 37.02 – – – WABCO Polska sp.z.o.o, Poland – – 142.45 29.11 – – WABCO do Brasil Industria e Comercio de Freios Ltda, Brazil – – 5.30 – – – WABCO Asia Private Ltd, Singapore – – 7.08 – – – WABCO Europe BVBA, Belgium – – 16.94 – – – WABCO GmbH, Germany – – 35.63 – – – WABCO France S.A.S, France – – 40.84 – – – – 174.71 1,480.88 1,146.64 – – 7 Payables as on 31.03.2010 Sundaram Industries Limited, Madurai – 61.58 – – – – Southern Roadways Limited ,Madurai – 7.01 – – – – T.V.Sundram Iyengar & Sons Limited,Madurai – 1.83 – – – – WABCO do Brasil Industria e Comercio de Freios Ltda, Brazil – – 10.71 0.27 – – WABCO Compressor Manufacturing Co. USA – – – 0.69 – – WABCO France S.A.S, France – – 10.86 – – – Shandong Weiming Automotive Product Co. Ltd, China – – 5.37 – – – WABCO Fahrzeugsysteme GmbH, Germany – – 98.90 191.44 – – – 70.42 125.84 192.40 – – 8 Remuneration to Key Management Personnel Mr C N Prasad - Whole Time Director – – – – 20.05 87.89 Mr P Kaniappan - Whole Time Director – – – – 61.73 – @ details for period from 1 4 2009 to 3 6 2009 only since these companies ceased to be associates from that date. 40 WABCO-TVS (India) Limited 21.07.2010 31 to 48.p65 40 7/22/2010, 6:40 PM


  • Page 42

    Schedules (continued) XVIII. NOTES ON ACCOUNTS (continued) (Rupees in lakhs) 17. Disclosure made in terms of clause 32 and clause 41 of the listing agreement with stock exchanges Particulars Name of the company Amount Maximum Amount outstanding amount due outstanding as on at any one time as on 31.03.2010 during the year 31.03.2009 (a) Loans and advances (i) Loans and advances in the nature The company does not have any of loans made to subsidiary company subsidiary. (ii) Loans and advances in the nature The company does not have any of loans made to associate company associate company. (iii) Loans and advances in the nature The company has not given any of loans made to firms/companies advance to firms/companies in which directors of the company in which directors of the are interested company are interested. (b) Investments by the company (i) In subsidiary companies The company does not have any subsidiary. (ii) In associate companies The company does not have any associate company. (iii) In joint venture The company does not have any joint venture. (c) Investments by the holding company On 3rd June 2009, the company became a subsidiary of Clayton Dewandre Holdings Limited, Rotterdam, The Netherlands, when the latter acquired 35.83% of share capital and is now holding 75 % of share capital. 41 WABCO-TVS (India) Limited 21.07.2010 31 to 48.p65 41 7/22/2010, 6:40 PM


  • Page 43

    Schedules (continued) XVIII. NOTES ON ACCOUNTS (continued) (Rupees in lakhs) 18. Information pursuant to the provisions of part II of Schedule VI of the Companies Act, 1956 (vide Notification dated 30th October, 1973 of the Department of Company Affairs, Government of India) Year ended 31.03.2010 Year ended 31.03.2009 Quantity Value Quantity Value I. RAW MATERIALS CONSUMED 1. a) Basic raw materials Steel sheets,bar materials & tubes Kgs 19,507 19.68 37,232 24.96 Castings and forgings Nos 51,72,099 6,869.50 43,99,336 5,299.54 b) Intermediates and components (which individually do not account for 10 % or more of the total value of consumption) 26,581.93 19,486.82 33,471.11 24,811.32 % of total % of total consumption consumption 2 Consumption of raw materials and components a) Imported 11.3 3,798.08 9.0 2,225.36 b) Indigeneous 88.7 29,673.03 91.0 22,585.96 100.0 33,471.11 100.0 24,811.32 II. CONSUMPTION OF MACHINERY SPARES a) Imported – – 2.0 1.81 b) Indigeneous 100.0 130.84 98.0 105.78 100.0 130.84 100.0 107.59 III. IMPORTS (CIF value) a) Raw materials 4,115.47 3,147.55 b) Spares, stores and components 149.76 193.88 c) Capital goods 154.53 743.82 IV. EXPENDITURE IN FOREIGN CURRENCY a) Commission on export sales 2.50 27.17 b) Travel 122.41 109.10 c) Training 5.21 14.56 d) Consultancy, retainer - Productivity improvement 27.08 10.12 - Recruitment – 61.37 e) Books and periodicals – 0.50 f) Others 45.45 77.26 V. PAYMENT TO NON RESIDENT SHAREHOLDERS a) No. of non resident shareholders One One b) No. of shares held by non residents 1,42,25,684 74,30,000 c) Dividend – relating to 31st March 2008 interim – 445.78 – relating to 31st March 2009 interim – 185.74 VI. EARNINGS IN FOREIGN EXCHANGE a) Exports (on FOB basis) 5,367.31 3,433.18 b) Freight and insurance recovery 158.17 100.44 c) Software service 997.74 1,041.40 d) R & D Service 87.43 373.40 e) Others 995.30 662.22 42 WABCO-TVS (India) Limited 21.07.2010 31 to 48.p65 42 7/22/2010, 6:40 PM


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    WABCO-TVS (India) Limited Schedules (continued) VII. PRODUCTION, SALES, OPENING & CLOSING STOCKS OF GOODS PRODUCED (Rupees in lakhs) 43 WABCO-TVS (India) Limited 21.07.2010 31 to 48.p65 Year ended 31.03.2010 Year ended 31.03.2009 Product Quantity Opening Production Sales Closing Stock Opening Stock Production Sales Closing Stock in Stock meant meant for sale for sale Qty. Value Qty. Qty. Value Qty. Value Qty. Value Qty. Qty. Value Qty. Value A Manufactured items a) Air assist and full air actuation system for automotive and non-automotive applications and elements thereof (Sets) 2,639 509.80 341,402 342,873 39,183.05 1,168 888.38 3,124 333.69 266,561 267,046 28,727.21 2,639 509.80 b) Spares 32.67 10,977.01 37.89 31.30 8,947.92 32.67 c) Exports 5,525.48 3,533.62 d) Anti lock braking system 3,440.26 1,385.83 542.47 59,125.80 926.27 364.99 42,594.58 542.47 7/22/2010, 6:40 PM Licensed / installed capacities information is not furnished in view of the abolition of the Industrial Licensing requirements 43


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    Cash Flow Statement for the year ended 31st March 2010 (Rupees in lakhs) Year ended Year ended 31.03.2010 31.03.2009 A. CASH FLOW FROM OPERATING ACTIVITIES Profit before tax and extraordinary items 11,833.19 5,255.48 Adjustments for: Depreciation 1,444.49 1,393.21 Profit on sale of investments (31.51) (46.82) Interest (net) 289.41 685.42 1,702.39 2,031.81 Operating profit before working capital changes 13,535.58 7,287.29 Adjustments for: Inventories 23.65 (1,527.90) Sundry debtors (6,117.12) 551.86 Other current assets 4.31 8.37 Loans and advances (676.71) 439.53 Current liabilities 3,,252.66 (4,481.33) Provisions 69.90 170.29 (3,443.31) (4,839.18) 10,092.27 2,448.11 Interest paid (296.08) (704.95) Direct taxes paid (4,509.35) (1,406.58) Net cash from operating activities (A) 5,286.84 336.58 B. CASH FLOW FROM INVESTING ACTIVITIES Additions to fixed assets including capital work in progress (986.34) (3,517.56) Sale of fixed assets during the year (net) 392.45 3.44 Redemption / (Purchase) of investments (net) 680.45 (34.91) Profit on sale of investments 31.51 46.82 Interest received 6.67 19.53 Net cash from / (used in) investing activities (B) 124.74 (3,482.68) 44 WABCO-TVS (India) Limited 21.07.2010 31 to 48.p65 44 7/22/2010, 6:40 PM


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    Cash Flow Statement for the year ended 31st March 2010 (continued) (Rupees in lakhs) Year ended Year ended 31.03.2010 31.03.2009 C. CASH FLOW FROM FINANCING ACTIVITIES Rupee term loan availed – 2,000.00 Rupee term loan repaid (2,000.00) – Unsecured loans availed (repaid) (500.00) 499.94 Dividend and dividend tax paid – (1,886.26) Net cash from financing activities (C) (2,500.00) 613.68 D. NET INCREASE IN CASH AND CASH EQUIVALENTS (A+B+C) 2,911.58 (2,532.42) Opening cash and cash equivalents (01.04.2009) – Cash and bank balances 127.91 1,163.27 – Cash credit utilisation (3,520.44) (3,392.53) (2,023.38) (860.11) Closing cash and cash equivalents (31.03.2010) – Cash and bank balances 238.28 127.91 – Cash credit utilisation (719.23) (480.95) (3,520.44) (3,392.53) Notes : 1. The above statement has been prepared in indirect method except in case of dividend and investments which have been considered on the basis of actual movement of cash. 2. Cash and cash equivalents include cash and bank balances VENU SRINIVASAN P KANIAPPAN As per our report annexed Chairman Whole-time Director For SUNDARAM & SRINIVASAN Chartered Accountants Chennai R MADHAVAN T S RAJAGOPALAN M BALASUBRAMANIYAM 4th May, 2010 General Manager (Finance) and Secretary Chief Financial Officer Membership No. F 7945 Partner 45 WABCO-TVS (India) Limited 21.07.2010 31 to 48.p65 45 7/22/2010, 6:40 PM


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    Balance Sheet abstract and Company’s General Business Profile I Registration Details Registration No. 5 4 6 6 7 of 2 0 0 4 State Code 1 8 Balance Sheet Date 3 1 - 0 3 - 2 0 1 0 II Capital Raised during the Year (Amount in Rs. Thousands) Public Issue N I L Rights Issue N I L Bonus Issue N I L Private Placement N I L III Position of Mobilisation and Deployment of Funds (Amount in Rs. Thousands) Total Liabilities 2 8 0 7 5 7 0 Total Assets 2 8 0 7 5 7 0 Source of Funds Paid-up Capital 9 4 8 3 8 Reserves & Surplus 2 6 0 8 3 5 2 Secured Loans 7 1 9 2 3 Unsecured Loans – Deferred Tax Liability 3 2 4 5 7 Application of Funds Net Fixed Assets 1 8 0 1 6 0 3 Capital work-in-progress 6 6 1 3 1 Investments 2 2 0 2 4 Net current Assets 9 1 7 8 1 2 Misc. Expenditure – IV Performance of Company (Amount in Rs. Thousands) Turnover 6 0 9 4 6 8 2 Total Expenditure 4 9 1 1 3 6 3 Profit before tax 1 1 8 3 3 1 9 Profit after tax 7 8 5 8 5 5 Earning per share in Rs. 4 1 . 4 3 Dividend Rate - % 5 0 V Generic names of three Principal Products / Services of Company (As per monetary terms) (ITC Code) Product Description Item Code No. (ITC Code) Air assist and full air actuation systems for automotive 8 7 0 8 . 0 0 and non-automotive applications and elements thereof 46 WABCO-TVS (India) Limited 21.07.2010 31 to 48.p65 46 7/22/2010, 6:40 PM


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    Regd. Office : Plot No. 3 (SP), III Main Road, Ambattur Industrial Estate, Chennai 600 058 ATTENDANCE SLIP PLEASE COMPLETE THIS ATTENDANCE SLIP AND HAND IT OVER AT THE ENTRANCE OF THE MEETING HALL Name of the REQUEST TO MEMBERS attending member __________________________________________ 1. Members and their proxies/bodies corporate should bring the DP Id.* _____________________ Client Id* _____________________ attendance slip duly filled in for attending the meeting. 2. Members are requested to avoid being accompanied by non- Folio No. **___________________ No. of shares __________________ members and/or children. 3. Members are requested to bring their copies of annual report to Name of proxy _____________________________________________ the meeting as the company is unable to provide another copy (If proxy attends instead of member) in view of the increased cost of paper. 4. Members are requested to be in their seats at the meeting hall I hereby register my presence at the annual general meeting. before the scheduled time for commencement of the annual general meeting to avoid interruption in the proceedings. Venue : "Sathguru Gnanananda Hall", 5. Members who are holding shares in physical form are requested Narada Gana Sabha Trust, to intimate the Share Tranfer Department of the company changes, No.314 (Old No.254) T.T.K Road, if any, in their registered address. Chennai 600 018 6. Members intending to appoint proxies are requested to complete the proxy form sent herewith and deposit the same with the Share Date : 26th August 2010 Transfer Department, at least 48 hours before the time fixed for holding the meeting. Time : 10.00 a.m. 7. If you and/or your family members are receiving more than one copy of the annual report and other communications and would Signature of member/proxy like to avoid duplication, kindly advise to enable us to mail only one copy. This will help us to avoid wastage. * Applicable for investors holding shares in electronic form. 8. In the case of shares held in electronic form, the beneficial owners ** Applicable for investors holding shares in physical form. are advised to bring the identity card issued by the depository participant. ---------------------------------------------------------- Tear here ---------------------------------------------------------------------------- Regd. Office : Plot No. 3 (SP), III Main Road, Ambattur Industrial Estate, PROXY FORM Chennai 600 058 DP Id.* ____________________Client Id.* _______________________ Folio No. ** ________________________________ I/We ___________________ of _________________ in the district of ___________________ being a Member/Members of WABCO-TVS (INDIA) LIMITED hereby appoint ________________________________ of ________________________ in the district of _______________ or failing him ________________________________ of _______________ in the district of ___________________ as my/our proxy to attend and vote for me/us on my/our behalf at the annual general meeting of the company to be held on Thursday the 26th August 2010 and at any adjournment thereof. Signed this _________ day of __________________ 2010. For For Office use Proxy No. Revenue Stamp Date of receipt No. of shares N.B.: The instrument appointing proxy should be deposited with the Share transfer department at least 48 hours before the commencement of the meeting * Applicable for investors holding shares in electronic form. ** Applicable for investors holding shares in physical form. Please fill in the particulars, viz. Folio No./DP Id/Client Id as given in the address slip. WABCO-TVS (India) Limited 21.07.2010 31 to 48.p65 47 7/22/2010, 6:40 PM


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    WABCO-TVS (India) Limited 21.07.2010 31 to 48.p65 48 7/22/2010, 6:40 PM


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