Bajaj Holdings & Investment
BSE: 500490 | NSE: BAJAJHLDNG | ISIN: INE118A01012 | Finance - Investments
- Directors Report
- Chairman's Speech
- Auditors Report
- Notes To Accounts
- Accounting Policy
- Finished Products
- Raw Materials
| Directors Report | Year End : Mar '08 |
The directors present their sixty-third annual report and the audited
statements of accounts for the year ended 31 March 2008.
Demerger
During the year under review, the Honble High Court of Judicature at
Bombay approved the scheme of arrangement of demerger of the company
vide its order dated 18 December 2007. Accordingly, the manufacturing
undertaking of the erstwhile Bajaj Auto Ltd. (BAL) has been vested with
new Bajaj Auto Limited and the strategic business undertaking
consisting of wind farm business and financial services business has
been vested with Bajaj Finserv Limited. The appointed date of this
demerger was closing hours of business on 31 March 2007.
Consequently, the name of the company has changed from Bajaj Auto
Limited to Bajaj Holdings & Investment Limited and a fresh certificate
of incorporation in the new name of the company has been issued by the
Registrar of Companies, Maharashtra, Pune on 5 March 2008.
Pursuant to the demerger, the company now holds strategic investments
in the group. The demerger enables the new companies to tap (on an
arms length basis) into the cash pool of the company to support their
future growth initiatives, even while enabling the company to
participate in the growth of the auto business and the financial
services business. The company will function primarily as an investment
company and will focus on new business opportunities.
The operations and financial results of the company are elaborated in
the annexed Management Discussion and Analysis Report. On account of
the demerger, the previous years figures of the company are not
comparable and hence are not given. The highlights are as under :-
Financial results
Operative income 3,553
Gross profit before interest & depreciation 3,495
Depreciation 2
Profit before taxation 3,493
Provision for taxation 423
Profit after tax 3,070
Disposable surplus 3,070
Proposed dividend 2,368
(inclusive of dividend tax)
Earnings per share (Rs.) 30.3
Dividend
The directors recommend for consideration of the shareholders at the
ensuing annual general meeting, payment of dividend of Rs. 20 per share
(200 per cent) for the year ended 31 March 2008. The amount of
dividend and the tax thereon aggregates to Rs. 2,368 million.
Dividend paid for the year ended 31 March 2007 was Rs.40 per share (400
per cent). The amount of dividend and the tax thereon aggregated to Rs.
4,735 million. In view of the demerger, the dividend figures for the
year 2006-07 and 2007-08 are not comparable.
Conservation of energy, technology absorption and foreign exchange
earnings & outgo
The company, having become an investment company pursuant to the
demerger of the company, has nothing to report on Conservation of
Energy, Technology Absorption and Foreign Exchange Earnings and Outgo
during the year under review.
Joint ventures / new companies
After the demerger of the company, investments of the company in Bajaj
Allianz Life Insurance Company Limited (BALICL), Bajaj Allianz General
Insurance Company Limited (BAGICL) have been transferred to Bajaj
Finserv Limited and investments in PT Bajaj Auto Indonesia (PTBAI) and
Bajaj Auto International Holdings BV (BAIHBV) have been transferred to
new Bajaj Auto Limited.
After the demerger, the following are the companies, which are the
subsidiary companies /joint venture / associate companies of the
company:
a. Bajaj Auto Holdings Ltd. Subsidiary
b. Maharashtra Scooters Ltd. Joint Venture
c. Bajaj Auto Ltd. Associate
d. Bajaj Finserv Ltd. Associate
Maharashtra Scooters Ltd. (MSL) is a company jointly promoted by
erstwhile BAL and Western Maharashtra Development Corporation Ltd.
(WMDC). WMDC had offered to sell its 27 per cent shareholding in MSL
and erstwhile BAL had confirmed its willingness to purchase these
shares. The price at which the shares were to be sold, had been jointly
referred to a sole arbitrator, Justice Arvind V Savant (Retd.), with an
understanding in writing that arbitral award would be final and binding
on both.
As reported last year, the award of the arbitrator dated 14 January
2006 valuing the share price of MSL at Rs. 151.63 per share as the rate
at which 3,085,712 equity shares of MSL held by WMDC are to be sold to
erstwhile BAL i.e. to the company, has been challenged by WMDC in the
Bombay High Court.
Directors
Consequent to demerger of the company and vesting of manufacturing
undertaking with Bajaj Auto Limited and strategic business undertaking
with Bajaj Finserv Limited, eight directors of the company viz.
Kantikumar Podar, D S Mehta, J NGodrej, Ms Suman Kirloskar, Naresh
Chandra, P Murari, Shekhar Bajaj and Niraj Bajaj resigned as directors
of the company with effect from the 20 February 2008 the effective date
of scheme of arrangement of demerger.
Further, Rahul Bajaj resigned as executive chairman, Madhur Bajaj
resigned as executive vice chairman, Rajiv Bajaj resigned as managing
director and Sanjiv Bajaj resigned as executive director of the company
with effect from 20 February 2008, the effective date of scheme of
arrangement of demerger. Rahul Bajaj will continue to act as
non-executive chairman and Madhur Bajaj, Rajiv Bajaj and Sanjiv Bajaj
shall continue on the board as non-executive directors.
Madhur Bajaj and Rajiv Bajaj retire from the board by rotation this
year and being eligible, offer themselves for re-appointment.
Directors responsibility statement
As required by sub-section (2AA) of section 217 of the Companies Act,
1956, directors state:
That in the preparation of annual accounts, the applicable accounting
standards have been followed along with proper explanation relating to
material departures.
That the directors have selected such accounting policies and applied
them consistently and made judgements and estimates that are reasonable
and prudent, so as to give a true and fair view of the state of affairs
of the company at the end of the financial year and of the profit of
the company for that period.
That the directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the company and for preventing and detecting fraud and other
irregularities.
That the annual accounts have been prepared on a going concern basis.
Consolidated financial statements
The directors also present the audited consolidated financial
statements incorporating the duly audited financial statements of the
subsidiaries, associates and joint ventures as prepared in compliance
with the accounting standards and listing agreement as prescribed by
SEBI.
Information in aggregate for each subsidiary company is disclosed
separately in the consolidated balance sheet.
Statutory disclosures
An application has been made for exemption with regard to attaching of
the balance sheet, profit and loss account and other documents of its
subsidiary company, Bajaj Auto Holdings Limited and the approval for
the same is awaited. The summary of the key financials of the companys
subsidiary is included in this annual report.
The annual accounts of the subsidiary company and the related detailed
information will be made available to the members of the company and
its subsidiary company, seeking such information at any point of time.
The annual accounts of the subsidiary company will be kept for
inspection by any member of the company at its registered office and
also at the registered office of the concerned subsidiary company.
An application has been made for exemption with regard to disclosure of
investments in the investment schedule in the accounts under section
211 (4) of the Companies Act, 1956 and the approval for the same is
awaited. Any shareholder interested in obtaining the details thereof
may write to the company.
As required under the provisions of sub-section (2A) of section 217 of
the Companies Act, 1956 read with the Companies (Particulars of
Employees) Rules, 1975 as amended, particulars of the employees are set
out in the Annexure to the Directors Report. As per provisions of
section 219(1)(b)(iv) of the said Act, these particulars will be made
available to any shareholder on request.
Particulars regarding technology absorption, conservation of energy and
foreign exchange earning and outgo required under section 217(1)(e) of
the Companies Act, 1956 and Companies (Disclosure of Particulars in the
report of board of directors) Rules, 1988 : The company, having become
an investment company pursuant to the demerger of the company, the
company has nothing to report on Conservation of Energy, Technology
Absorption, Foreign Exchange Earnings and Outgo during the year under
review.
Directors Responsibility Statement as required by section 217(2AA) of
the Companies Act, 1956 appears in a preceding paragraph.
Certificate from auditors of the company regarding compliance of
conditions of corporate governance is annexed to this report as
Annexure 1.
A Cash Flow Statement for the year 2007-08 is attached to the balance
sheet.
Corporate governance
Pursuant to Clause 49 of the listing agreement with stock exchanges, a
separate section titled Corporate Governance has been included in
this annual report, along with the reports on Management Discussion and
Analysis and Additional Shareholder Information.
All board members and senior management personnel have affirmed
compliance with the code of conduct for the year 2007-08. A
declaration to this effect signed by the Chief Executive Officer
(Operations) [CEO (O)] of the company is contained in this annual
report.
The CEO (O) and Chief Financial Officer (CFO) have certified to the
board with regard to the financial statements and other matters as
required in clause 49 of the listing agreement and the said certificate
is contained in this annual report.
Auditors report
The observations made in the Auditors Report, read together with the
relevant notes thereon are self-explanatory and hence, do not call for
any comments under section 217 of the Companies Act, 1956.
Auditors
The members are requested to appoint auditors for the period from the
conclusion of the ensuing annual general meeting till the conclusion of
the next annual general meeting and to fix their remuneration.
In view of demerger of the company, provisions relating to cost audit
will no longer be applicable to the company from the year under review.
On behalf of the board of directors
Rahul Bajaj
Chairman
22 May 2008
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| Source : Religare Technova | |
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