The Directors present their Report on the business and operations of
 your Company for the year ended 30th September, 2010.
 
 FINANCIAL RESULTS
  
                                       Accounting      Accounting
                                       Year ended      Year ended
                                        on 30th        on 30th
                                   September, 2010     September, 2009
                                    (Rs. in Lakhs)     (Rs. in Lakhs)
 
 Gross Sales and
 Other Income                                762        3422
 
 Net Profit / (Loss) for
 the period                                 (605)       9763
 
 Profit / (Loss)
 carried forward
 
 Last Year                                (15300)     (25060)
 
 This Year                                (15906)     (15300)
 
 After transfering its 2-wheeler business related assets to a Mahindra
 group company (Mahindra Two Wheelers Limited) as part of its business
 restructuring, in November, 2008, the Company has aligned itself with
 the Mahindra and Mahindra Group. As a result of the transfer of the
 business assets to Mahindra Two Wheelers Limited, during the Accounting
 Year ended 30th September, 2010 (period under review), the Company
 has not produced any two-wheelers. During the period under review, the
 Company has sold from out of its stocks 100 no.s of two-wheelers as
 against a sale of 996 no.s in the previous period.
 
 During the year, the company has transferred / sold off its
 manufacturing unit (land and building) at Supa near Ahmednagar, to
 Mahindra Two Wheelers Limited (MTWL), pursuant to the agreement
 relating to transfer / sale of its two wheeler business related assets.
 The other assets relating to the Supa unit, were transferred / sold to
 MTWL, in the month of November, 2010.
 
 FOREIGN EXCHANGE EARNINGS AND OUTGO
 
 The information on foreign exchange earnings and outgo is contained in
 Schedule 13, Notes to the Accounts ( Point Nos.8, 9 and 10)
 
 CONSERVATION OF ENERGY
 
 The present level of energy consumption of the Company is very
 insignificant.
 
 DIRECTORS RESPONSIBILITY STATEMENT
 
 Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors
 confirm that:
 
 1.  In preparation of the accounts for the period under review, your
 company has followed the applicable accounting standards.
 
 2.  Appropriate accounting policies have been selected and applied
 consistently and have 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 as at 30th September, 2010 and of the loss of the
 Company for the period ended on that date.
 
 3.  Proper and sufficient care has been taken 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.
 
 4.  The Annual Accounts for the period under review have been prepared
 on a Going Concern basis.
 
 CORPORATE GOVERNANCE
 
 The Company is implementing Corporate Governance code as per the
 Listing Agreement with Stock Exchanges. A separate Report on Corporate
 Governance is given as Annexure to the Directors Report.
 
 REGISTERED OFFICE
 
 The Registered Office of the Company has been proposed to be shifted
 from its present location at Indore, M.P. to Pune, Maharashtra. A
 Petition in that behalf is being submitted to Company Law Board.
 
 PARTICULARS OF EMPLOYEES
 
 Particulars of Employees as required under Section 217 (2A) of the
 Companies Act, 1956 read with Companies (Particulars of Employees)
 Rules, 1975 are contained in a Statement forming part of this Report.
 However, as per the provisions of Section 219(1)(b)(vi) of the
 Companies Act, 1956, the Report and Annual Accounts are being sent to
 the shareholders of the Company, excluding the particulars of
 employees. Any shareholder interested in obtaining a copy of the said
 Statement may write to the Company.
 
 DIRECTORS
 
 Mr. Dinesh Munot and Mr. M. Venkataiah are liable for retirement by
 rotation at the ensuing AGM of the Company, and they are eligible for
 reappointment.
 
 AUDITORS
 
 The Auditors M/s Lakhani & Co, Chartered Accountants, hold their office
 until the conclusion of the ensuing AGM, and have furnished a
 certificate in terms of Sec. 224(1) of the Companies Act, 1956, about
 their eligibility.
 
 FIXED DEPOSITS
 
 The company has not accepted any fixed deposit from public during the
 period under review.
 
                              By Order of the Board of Directors 
                               For KINETIC MOTOR COMPANY LIMITED
 
                                                     A.H.FIRODIA
 
 Pune : February 12, 2011                               Chairman