Dear Shareholder''s
 
 Caged birds accept each other; but flight is what they crave for.  When
 Pawan and I sat down to draft this communiqué last year, there was a
 feeling of being unfettered and free. And rightly so, as we were about
 to take off on our first solo flight.
 
 Our first year of this flight has been extremely successful. All our
 stakeholders, including our customers, employees, investors, suppliers
 and dealers strongly supported and endorsed Brand Hero, as we bravely
 coursed through the transition.
 
 Hero has overcome the high-base effect of the previous year and
 weathered the country''s ongoing challenging business environment. It
 was a year in which interest rates peaked, inflation remained
 stubbornly high, the rupee weakened and consumer demand petered out.
 Even so, nearly six-and-a-quarter million customers remained undeterred
 and reposed their faith in Brand Hero.
 
 It was purely this faith of our customers, which enabled us to increase
 our market share and outperform the industry.
 
 Well, it wasn''t just our customers who demonstrated their unrelenting
 faith in us. Our eyes and ears in the market - our extensive dealer
 network - also showcased their unflinching support. In fact, we began
 the year with over 4,700 touch-points and gradually spread across the
 country to end the year with over 5,100 touch-points.
 
 This strong endorsement from our customers and channel partners is what
 encouraged us to try and replicate the Hero success story overseas,
 especially in markets similar to ours.
 
 You will read details of these plans and about all our other exciting
 plans to shore up our product and technology capabilities in the MD''s
 message. On my part, all I would like to express is my supreme
 confidence about the future.
 
 WHERE WE STAND
 
 Ten years ago, 12% of Indian households owned two-wheelers; the 2011
 census data indicates this figure has risen to 21%. It is my firm
 belief that the two-wheeler industry will continue to defy gravity and
 the base effect for many more years to come.
 
 Around us, the times may be a bit challenging. Yet, at Hero, we are
 going through a very exciting and dynamic period, where skills,
 technologies and scales are getting built and developed for this
 decade, and the next.
 
 Let me thank you, dear shareholders, for your whole-hearted and
 unflinching support over the past year. You have bestowed us with the
 conviction, strength and courage to prepare for, and face, the future.
 As we march ahead, I know I can continue to rely on your support to
 strengthen Brand Hero in India and across the world.
 
 With regards,
 
 Brijmohan Lall Munjal
 
 Chairman