The Board of Directors have pleasure in presenting the 55th Annual
Report alongwith the audited accounts of the Company for the year ended
March 31, 2012.
Your company achieved impressive top line growth during the Financial
Year 2011-12 with a total revenue of Rs. 37,204.56 lacs being 15% higher
than the previous year. The operating profits before interest and
depreciation amounted to Rs. 4,152.25 lacs showing a growth of 12.9% over
the previous year.
Profits after providing for taxation amounted to Rs. 1,062.57 lacs in
comparison to Rs. 951.11 lacs in the previous year. The Financial Results
are summarized below:-
Financial Highlights: (Rs. in lacs)
Year Ended Year Ended
Particulars March 31,
2012 March 31,
Revenue from Operations (Gross) 37,204.56 32,341.20
Profit before Interest and Depreciation 4,152.25 3,679.05
Less : Interest 1,990.98 1,663.16
Depreciation 1,079.42 1,038.86
Profit before Tax 1,081.85 977.03
Less: Provision for Taxation 167.50 141.50
Provision for Deferred Tax 23.14 25.91
MAT Credit Entitlement (167.50) (141.50)
(Excess) / Short provision for
tax for earlier years written back / provided (3.86) 0.01
Profit after Tax 1,062.57 951.11
Add: Balance Brought forward from last year 2,011.39 1,282.46
Profit available for appropriations 3,073.96 2,233.57
Proposed Dividend 148.15 148.15
Tax on Dividend 24.03 24.03
Transfer to General Reserve 50.00 50.00
Balance carried forward 2,851.78 2,011.39
Total 3,073.96 2,223.57
During the year 2011-12 high rate of inflation, consistently moving up
interest rates as well as fuel prices reflected adversely on the
automobile demand. A slowing economy took some sheen off car sales
which registered a growth of only 2% over the previous year. At the
same time, the Sports Utility Vehicle (SUV) segment attracted most
automobile makers and is expected to cash in on growing consumer
Commercial vehicle sale which grew at 8% during 2011-12 to 8,09,000
units is expected to touch 16,00,000 units by 2016-17 at a compounded
annual growth rate of 15%. This would be largely driven by rapid pace
of urbanization. Small and light commercial vehicles will hold major
chunk of this growth.
Two wheelers historically being the fastest growing segment witnessed
only a moderate growth of 7% during 2011-12 over the previous year.
Tractor Sales after expanding at a compounded annual growth rate of 25%
for 3 years, are losing steam. Research reports indicate that tractor
industry may see decline in sales during 2012-13.
The Indian Engineering Industry appears poised for better access to
Japanese and European markets. Your company also achieved significant
growth in export particularly of forged parts. Export sales (FOB Value)
during the year amounted to Rs. 6,092.26 lacs showing a growth of 52.7%
over the previous year mark of Rs. 3,989.96 lacs. Export incentives were
significantly reduced due to change in government policy effective from
Oct. 2011 resulting in lower profit margins on exports.
With the influx of Multi National companies in India, the competition
is increasing and so is the requirement for technological up gradation.
Your company is keeping pace with latest technologies and continuing to
maintain its leadership position in domestic market.
Your Directors are pleased to recommend 12% dividend for the year
2011-12 at par with the dividend declared last year. This would amount
to Rs. 1.20 per share, aggregating to Rs. 172.18 lacs (including tax on
dividend) on the paid up share capital of the company.
TRANSFER OF UNPAID DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND
The Company shall transfer the unclaimed dividends for the year 2004-05
to Investor Education and Protection Fund on or before September 03,
2012 as being unpaid for a period of seven years in compliance with the
provisions of Section 205C of the Companies Act, 1956.
The shareholders who have not encashed dividend warrant for the
financial year 2004-05 or any subsequent year are requested to lodge
their claims for revalidation of dividend warrants. The Company is
specifically intimating those members who have so far not claimed the
unpaid dividend for these years.
The Fixed Deposit Scheme of the Company continued during the year.
Deposits accepted from the public amounted to Rs. 1,652.17 lacs on March
31, 2012. Your Company has duly complied with the Residuary
Non-Banking Companies (Reserve Bank) Directions, 1987 issued by the
Reserve Bank of India.
Out of these Deposits 38 fixed deposits aggregating to Rs. 14.57 lacs
matured for payment, but were neither claimed nor renewed by the
Your company strives to be the forefront player and maintain its
leadership position in the Indian Gasket Industry aimed at developing
new products to meet the emerging needs of its customers. It continued
to build on its in-house capabilities and work with business partners
to ensure cost competitiveness and adoption of new techniques. During
the year Non-asbestos materials for gaskets were successfully developed
at the Sohna Plant replacing old Asbestos material.
At the Forging Division, your company contributed equity capital in the
Caparo Power Pvt. Ltd., so as to be able to obtain gas based power
supply at comparatively economical cost per unit. This will add to
forging business''s profitability.
Your company signed a Joint Venture Agreement during the year with
Sistemi Sospensioni S.p.A Italy, a Fiat Group Company and contributed
equity on 50:50 basis for setting up a new venture under the name
Magneti Marelli Talbros Chassis Systems Pvt. Ltd., to manufacture
Control Arms, Knuckles, Cross Members, Hubs, Spindles etc. for supply
as Tier I supplier to OEMs. Existing production equipments being used
for manufacturing of Sheet Arms at the Company''s Sheet Metal Division
have been transferred to the Joint Venture Company.
The Joint Venture Company started its operations from April 01, 2012 at
BOARD OF DIRECTORS
In accordance with the provisions of the Companies Act, 1956 and the
Articles of Association of the Company, Mr. A.K. Mehra and Mr. Rajive
Sawhney, directors of the Company, retire by rotation at the ensuing
Annual General Meeting and being eligible, offer themselves for
re-appointment. The details of Mr. A.K. Mehra and Mr. Rajive Sawhney
are given elsewhere in the Report.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to sub section (2AA) of Section 217 of the Companies Act,
1956, your Directors state and confirm
a. that in the preparation of annual accounts, all the applicable
accounting standards have been followed and there has not been any
material departure from them.
b. that such accounting policies were selected and applied
consistently and such judgments and estimates were made that were
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 under review;
c. that proper and sufficient care was 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 frauds and other irregularities;
d. that the annual accounts for the financial year under reference
have been prepared on a ''going concern'' basis.
Your company is committed to benchmarking itself with other corporates
providing good Corporate Governance and disclosure practices.
The essence of Corporate Governance lies in adoption of good management
practices, compliance with different statutes and adherence to ethical
standards so as to take the business forward and maximize stake
holders'' values. The Corporate Governance structure in the Company
assigns responsibilities and entrusts authority among different
participants in the organization i.e. Board of Directors, Senior
Management team and middle management employees.
Pursuant to Clause 49 of the Listing Agreement with Stock Exchanges, a
separate section titled Corporate Governance has been included in
this Annual Report alongwith a Certificate from the Auditors of the
Company and a Certificate from the Vice Chairman & Managing Director
and Chief Finance Officer.
MANAGEMENT DISCUSSION AND ANALYSIS
A detailed chapter on Management Discussion and Analysis (MDA)
pursuant to Clause 49 of the Listing Agreement is annexed to the Annual
Report and forms integral part of this Report.
M/s. S.N. Dhawan & Co., Chartered Accountants and Statutory Auditors of
the company, M/s. R. Sundraraman & Co. Chartered Accountants & Auditors
for the Chennai Plant and M/s. Chandrakant G. Doshi & Co., Chartered
Accountants & Auditors for the Pune Plant hold office till the
conclusion of the forthcoming Annual General Meeting and being eligible
for re-appointment, have confirmed that their re-appointment if made,
shall be within the limits of Section 224(1B) of the Companies Act,
1956. The Board recommends the re-appointment of M/s. S.N. Dhawan & Co.
as Statutory Auditors of the company and M/s. R. Sundraraman & Co. as
auditors for the Chennai Plant and M/s. Chandrakant G. Doshi & Co., as
auditors for the Pune Plant of the Company.
The Auditor''s observations and the relevant notes on the accounts are
self-explanatory and therefore, do not call for further comments.
JOINT VENTURE COMPANY
As per the Accounting Standard (AS 27), Financial Reporting of
interests in Joint Ventures the Consolidated Financial Statements
comprise of the operating results of your company and 40% share in the
operating results of the Joint Venture company, Nippon Leakless Talbros
Pvt. Ltd. Consolidated Revenue from Operations (Gross sales) grew at
16.08% to Rs. 40,659.42 lacs as compared to Rs. 35,027.02 lacs in the
The consolidated net profit after tax for the year has been Rs. 1,437.89
lacs being 14.04% higher than the previous year figure of Rs. 1,260.87
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, RESEARCH AND DEVELOPMENT
AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Information pursuant to sub-section 1(e) of Section 217 of the
Companies Act, 1956 read with the Companies (Disclosure of Particulars
in the Report of the Board of Directors) Rules, 1988 is given in
Annexure-I to this Report.
PERSONNEL & PARTICULARS OF EMPLOYEES
The Board of Directors wishes to express their appreciation to all the
employees for their outstanding contribution to the operations of the
Company during the year. It is the collective spirit of partnership
across all sections of employees and their sense of ownership and
commitment that has helped the Company to grow.
A statement u/s 217(2A) containing list of employees drawing
remuneration exceeding Rs. 60.00 lacs per annum or Rs. 5.00 lacs per month
is attached with this report as Annexure II.
It is our strong belief that caring for our business constituents has
ensured our success in the past and will do so in future. Contribution
of all the employees at different levels has been commendable in the
operations of the company. The Board of Directors wishes to express
their appreciation to the collective spirit of partnership across all
sections of employees who helped the company to grow.
Your directors acknowledge with sincere gratitude co-operations and
assistance extended by the shareholders, Central and State Government
Agencies, Financial Institutions, Banks, Customers, Dealers, Vendors
and all other business associates.
For and on behalf of the Board
VARUN TALWAR UMESH TALWAR
Joint Managing Vice Chairman &
Director Managing Director
Place : Gurgaon
Date : May 29, 2012