Dear Members,
 
 The Directors have pleasure in presenting this 51st Annual Report
 together with the Audited Statements of Accounts for the year ended on
 March 31, 2011.
 
 Your Directors always try to maximize the value to the share holders.
 We have maintained our tradition of coming forth with high quality
 content and services. Our tradition in no way inhibits our capacity for
 innovations.
 
 As trustees of the Company, we share our vision of growth with you. Our
 guiding principles are a blend of realism and optimism which has been
 and will be the guiding force of all our future endeavours.
 
 The summary of operating results for the year and appropriation of
 divisible profits is given below:
 
 Standalone financial performance
 
 For the year ended on 31st March, 2011, the
 
 Company has achieved Turnover ofRs. 11,772.09 Mn. and Net Profit ofRs.
 879.21 Mn. as against the Turnover of Rs. 10,463.70 Mn. and Net Profit of
 Rs. 661.75 Mn.  respectively during the previous year, representing
 increase in Turnover of 12.50% and increase in Net Profit by 32.86%.
 
 The Company holds total unexecuted orders worthRs. 13,840 Mn. Out of
 whichRs. 10,590 Mn. is for the MHE division and Rs. 3,250 Mn. is for the
 Gear Division as of March 31, 2011. This will help us to continue to
 have sustainable growth in coming years. Your Company has ability to
 attend substantial live enquiries with excellence.
 
 Consolidated operations
 
 In compliance with the applicable Clauses of the Listing Agreements
 with the Stock Exchanges, the Company has prepared Consolidated
 Financial Statements as per the Accounting Standard on Consolidated
 Financial Statements (AS 21, AS 23 & AS 27) issued by the Institute of
 Chartered Accountants of India. The Audited Consolidated Financial
 Statements along with the Auditors'' Report have been annexed to
 
                                                             (Rs. in Mn)
 
 Year Ended March 31,                     Standalone        Consolidated
 
                                         2010-11   2009-10       2010-11
 
 Profit Before Tax, Interest, 
 Depreciation &                          2049.42    1743.26      2121.86
 Adjustments for previous year
 
 Less: Interest                           458.26     508.89       485.46
 
 Depreciation                             384.26     331.20       406.38
 
 Profit Before Tax                       1206.90     903.17      1230.02
 
 Less: Provision for Tax                  319.63     166.64       337.02
 
 Deferred Tax                               8.06      74.78         6.31
 
 FBT                                         -
 
 Profit After Tax                         879.21      661.75      886.69
 
 Add:
 
 Share of Profits of Associates             -           -          12.89
 
 Adjustment of Previous Years                           7.74        -
 
 Previous Year Balance Brought Forward     207.94     200.87      203.75
 
 PROFIT AVAILABLE FOR APPROPRIATION        1087.15     870.36    1103.33
 APPROPRIATIONS:
 
 Proposed Dividend                          167.15     139.29     167.15
 
 Income Tax on Dividend                      27.12      23.13      27.74
 
 Transfer to General Reserve                650.00     500.00     667.45
 
 Balance Carried Forward                    242.88     207.94     240.99
 
 this Annual Report.
 
 This is the first year of consolidation. Your Company''s total
 consolidated revenue for the year 2010- 11 was t 12,876.14 Mn. The Net
 Profit after provision for taxation for the year ended 31st March, 2011
 was Rs. 899.58 Mn. The basic earnings per share for the year was Rs. 9.69.
 Your Company''s consolidated net worth is Rs. 4,147.58 Mn. as on 31 March,
 2011.
 
 Your Directors are pleased to recommend dividend ofRs. 1.80 per share
 (previous year Rs. 1.50 per share on 9,28,61,510 equity shares ofRs. 2/-
 each) on 9,28,61,510 equity shares of Rs. 21- each for the year ended on
 31st March, 2011.
 
 Directors'' Responsibility Statement
 
 Pursuant to Section 217(2AA) of the Companies Act, 1956, with respect
 to the Directors'' Responsibility Statement, it is hereby confirmed
 that:
 
 - in the preparation of the annual accounts of the Company for the year
 ended on March 31, 2011, the applicable accounting standards have been
 followed;
 
 - the Directors have selected such accounting policies and applied them
 consistently and made judgments and estimates that are reasonable and
 prudent so as to give a true and fair view of the state of affairs of
 the Company at the end of the financial year and of the profit of the
 Company for the year ended on that date;
 
 - 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; and
 
 - the accounts have been prepared on a going concern basis.
 
 Retire by rotation
 
 In accordance with the provisions of the Companies Act, 1956 and the
 Articles of Association of the Company, Shri Pradip M. Patel and Shri
 Chirayu Amin, Directors retire by rotation at the forthcoming Annual
 General Meeting of the Company and being eligible, offer themselves for
 reappointment.
 
 Re-appointment of Shri Prayasvin B. Patel as Chairman and Managing
 Director
 
 The tenure of Shri Prayasvin B. Patel, Chairman & Managing Director of
 the Company will expire on 30th June, 2011. The Remuneration Committee
 and the Board of Directors at their respective meetings held on 24th
 May, 2011 recommended and approved the re- appointment of and payment
 of remuneration to Shri Prayasvin B. Patel as Chairman & Managing
 Director of the Company for a further period of three years w.e.f.  1st
 July, 2011, subject to the approval of Shareholders.  Terms and
 conditions for his re-appointment are contained in the Explanatory
 Statement forming part of the notice of the ensuing Annual General
 Meeting.
 
 Appointment of Shri Prashant C. Amin as an Executive Director
 
 Shri Prashant C. Amin has been appointed as Director liable to retire
 by rotation w.e.f. 29th July, 2008.  The Remuneration Committee and the
 
 Board of Directors at their respective meetings held on 24th May, 2011
 recommended and approved the appointment of and payment of remuneration
 to Shri Prashant C. Amin as Executive Director of the Company for a
 period of three years w.e.f. 1st June, 2011, subject to the approval of
 Shareholders. Terms and conditions for his re-appointment are contained
 in the Explanatory Statement forming part of the notice of the ensuing
 Annual General Meeting.
 
 The Company''s Auditors M/s. Thacker Butala Desai, Chartered
 Accountants, Navsari retire as Statutory Auditors at the ensuing Annual
 General Meeting of the Company and being eligible offer themselves for
 reappointment.
 
 Subsidiary Companies
 
 During the year under review, the Company has incorporated a Wholly
 Owned Subsidiary, (WOS) in Mauritius, namely, Elecon Transmission
 International Ltd. to acquire the business of Benzlers-Radicon Group, a
 Sub-Group of David Brown Gear Systems Group, UK.  the said WOS has
 executed Sale and Purchase Agreement (SPA) to acquire 100% stake in the
 business of 1) David Brown Systems Sweden AB (Sweden), 2) Applied
 
 Transmission Products Division of David Brown Geared Systems Limited
 (U.K) and 3) Geared Motor Division of Cone Drive Operations Inc. (U.S)
 (the Business) of the David Brown Gear Systems Group. The WOS has
 also paid the acquisition consideration to the Seller on 26.11.2010.
 
 The following eleven subsidiaries were set up / acquired during the
 year:
 
 1.  Elecon Transmission International Ltd., Mauritius.
 
 2.  Radicon Transmission UK Ltd.
 
 3.  Elecon USA Transmission Ltd.
 
 4.  David Brown Systems Sweden AB
 
 5. AB Benzlers, Sweden
 
 6.  Benzler Technisch Buro Aandrijftechniek B.V. (The Netherlands)
 
 7.  Benzler Transmission A.S. (Denmark)
 
 8.  Benzler Andtriebstech nik GmbH (Germany)
 
 9.  Oy Benzler AB (Finland)
 
 10.  Benzlers Antriebstechnik Gesmbh, Austria
 
 11.  Benzlers Malaysia, Malaysia
 
 Radicon Transmission UK Ltd.
 
 Warehouse and offices currently located at DB site, Huddersfield, UK
 Warehousing, service, assembly, sales office Engineering: design and
 applications There are total 58 Employees at present Relocation to
 
 alternative premises in November 2011
 
 Elecon USA Transmission Ltd
 
 Site located in Traverse City, Michigan Warehousing, Assembly, Testing
 Growth opportunities through regional focus, product expansion, sales
 team focus
 
 AB Benzlers, Sweden
 
 Plant located in Helsingborg, Sweden Property owned by AB Benzlers
 Manufacturing , Assembly, Testing, Warehousing ; Engineering: Design
 and Applications ; At present, there are total 99 Employees Satellite
 service centre in Orebro (central Sweden) opens April 2011
 
 Benzler Technisch Buro Aandrijftechniek B.V. (The Netherlands)
 
 - Site located in Venlo, Netherlands Warehousing, service, assembly,
 sales office Well positioned to serve Centra! Europe
 
 Benzlers-Radicon Intellectual Property acquired: Brands :
 
 Products & Range Designs
 
 Series G Industrial Reducer Series H Industrial Reducer Series BD Screw
 Jacks Series BS Worm Drive Series BTM Shaft Mount Reducer Series A Mid
 Worm Drive Series J Shaft Mount Reducer Series X Couplings Roloid Gear
 Pump Kibo Taper Release System
 
 By virtue of this acquisition, your Company can expand its operations
 in various Countries across the globe either directly or through its
 Subsidiary Companies.
 
 The Ministry of Corporate Affairs, Government of India, vide General
 Circular No. 2/2011 dated 8th February, 2011, exempt Companies from
 attaching to its Balance Sheet,
 
 the individual Annual Reports of its subsidiary companies. As per the
 Circular, the consolidated financial statements of the Company and all
 its subsidiaries duly audited by its statutory auditors are included in
 the Annual Report.
 
 Shareholders interested in obtaining the statement of Company''s
 interest in the subsidiaries or stand-alone financial statements of the
 subsidiary Companies may obtain the same by writing to the Company
 Secretary of the Company.
 
 The annual accounts of subsidiary Companies are available for
 inspection by any investor at the registered office of the Company.
 
 Ringspann GmbH, Germany, a joint venture partner in Ringspann Elecon
 (India) Ltd., a Joint Venture Company (JVC) has made divestment of
 their entire shareholding by selling their stake to Elecon Group of
 Companies. In view of the said divestment, the said JVC has applied for
 the change of name.  The JVC will continue to use the technology of the
 outgoing German partner for its captive consumption.
 
 As per Clause 49 of the Listing Agreement, a report on Corporate
 Governance, together with Management Discussion and Analysis and a
 certificate from the Company''s Auditors form part of this report.
 
 Your Company, acknowledging its corporate responsibility, has
 voluntarily obtained a Secretarial Compliance Report from Mr. Ashwin
 Shah, Company Secretary in whole-time practice, which is annexed to
 this Report.
 
 Your Company is committed to maintain the highest standards of
 Corporate Governance, reinforcing the valuable relationship between the
 Company and its Stakeholders.
 
 During the year under review, your Company has not accepted any fixed
 deposits under the provisions of Section 58A of the Companies Act, 1956
 read with Companies (Acceptance of Public Deposits) Rules, 1975. There
 are no unclaimed deposits as on 31st March, 2011.
 
 Statement as per Section 217(2A) of the Companies Act, 1956 read with
 the Companies (particulars of employees) Rules, 1975 as amended is
 annexed to this Report as Annexure A, forming part of this Report.
 
 The particulars required to be furnished under Section 217(l)(e) read
 with the Companies (Disclosure of particulars in the report of Board of
 Directors) Rules, 1988 are given in Annexure B, forming part of this
 report.
 
 None of the Directors of your Company is disqualified as per provisions
 of Section 274(1 )(g) of the Companies Act, 1956. Your Directors have
 made necessary disclosures, as required under various provisions of the
 Act and Clause 49 of the Listing Agreement.
 
 The Company takes a very pragmatic approach towards insurance. Adequate
 cover has been taken for all movable and immovable assets for various
 types of risks.
 
 Your Company is committed to upholding its excellent reputation in the
 field of Industrial relations. Through continuous efforts the Company
 invests and improvises development programmes for its employees.
 
 As trustees of the Company, the Directors acknowledge the unstinted
 support received from Vendors, Traders, Customers, Banks, Financial
 Institutions, Shareholders and the society at large.
 
 The Directors also acknowledges the support of the Bankers, Auditors,
 Central and State Government Officials, Solicitors, Advisors, Business
 Partners and Members of Elecon family. The growth of the Company would
 not have been possible without their unfailing support.
 
 Your Directors look forward to having a long and fruitful relationship
 with all of them.
 
 For and on behalf of Board of Directors
 
 
 
 Prayasvin B. Patel
 
 Chairman & Managing Director
 Vallabh Vidyanagar, May 24, 2011