TO THE MEMBERS OF TATA MOTORS LIMITED
The Directors present their Sixty-Seventh Annual Report and the Audited
Statement of Accounts for the year ended March 31, 2012.
FINANCIAL PERFORMANCE SUMMARY
(Rs. in crores)
Company Tata Motors Group
(Standalone) (Consolidated)
FY 2011-12 FY 2010 -11 FY 2011-12 FY 2010-11
FINANCIAL RESULTS
Gross revenue 59,220.94 51,183.95 170,677.58 126,414.24
Net revenue
(excluding excise duty) 54,306.56 47,088.44 165,654.49 122,127.92
Total expenditure 49,894.76 42,282.07 141,954.02 104,312.89
Operating profit 4,411.80 4,806.37 23,700.47 17,815.03
Other income 574.08 422.97 661.77 429.46
Profit before interest,
depreciation, amortization,
Exceptional item and tax 4,985.88 5,229.34 24,362.24 18,244.49
Finance cost 1,218.62 1,383.70 2,982.22 2,385.27
Cash profit 3,767.26 3,845.64 21,380.02 15,859.22
Depreciation,
amortization and product
Development /
engineering expenses 1,840.99 1,502.00 7,014.61 5,653.06
Profit for the year
before exceptional
items & tax 1,926.27 2,343.64 14,365.41 10,206.16
Exceptional items
- loss/(gain) 585.24 147.12 831.54 (231.01)
Profit before tax 1,341.03 2,196.52 13,533.87 10,437.17
Tax expense/(credit) 98.80 384.70 (40.04) 1,216.38
Profit after tax 1,242.23 1,811.82 13,573.91 9,220.79
Share of minority
interest and share of
profit of associates(net) - - 57.41 (52.83)
Profit for the year 1,242.23 1,811.82 13,516.50 9,273.62
APPROPRIATIONS
Profit for the year 1,242.23 1,811.82 13,516.50 9,273.62
Balance brought forward
from previous year –
profit/(loss) 2,078.92 1,934.13 6,461.49 (1,017.85)
Amount available for
appropriations 3,321.15 3,745.95 19,977.99 8,255.77
Less: appropriations
Debenture Redemption
Reserve 70.00 - 70.00 -
General Reserve 125.00 200.00 158.03 228.78
Other Reserves - - 65.38 84.20
Dividend (including
dividend
distribution tax) 1,462.24 1,467.03 1,488.62 1,481.30
Balance carried to
Balance Sheet 1,663.91 2,078.92 18,195.96 6,461.49
DIVIDEND
Considering the Company''s financial performance, the Directors
recommended a dividend of Rs.4/- per share (200%) on the capital of
2,70,77,31,241 Ordinary Shares of Rs.2/- each (previous year: Rs.20/- per
share (200%) on share of face value of Rs.10/- each) and Rs.4.10 per share
(205%) on 48,19,59,190 ''A'' Ordinary Shares of Rs.2/- each (previous year:
Rs.20.50 per share (205%) on share of face value of Rs.10/- each) fully
paid-up for FY 2011-12 and will be paid on or after August 14, 2012.
The said dividend, if approved by the Members, would involve a cash
outflow of Rs.1,464 crores (previous year: Rs.1,466 crores) including
dividend distribution tax resulting in a payout of 118% (previous year:
81%) of the standalone profits for the year and 11% (previous year:
16%) of the consolidated profits of the Company.
SUB-DIVISION OF SHARES
As a step towards better liquidity and increased investor
participation, the Company undertook a sub-division of face value of
its Ordinary Shares and ''A'' Ordinary Shares (collectively the Shares)
from Rs.10/- to Rs.2/- per share with effect from the Record Date i.e.
September 13, 2011. New ISINs - INE155A01022 for Ordinary Shares and
IN9155A01020 for ''A'' Ordinary Shares have been obtained from the
Depository. Consequently, the sub-divided Shares were credited to the
respective depository accounts of Members holding shares in electronic
form and new share certificates were issued to Members holding Shares
in physical form.
OPERATING RESULTS AND PROFITS
Global markets had a mixed year with the US showing recovery, European
countries continue to face a crisis, while Asia, China in particular,
continued on a healthy growth trajectory.
After a strong performance in FY 2010-11, the Indian economy showed
signs of slowdown in FY 2011-12, due to inflationary pressures.
Measures taken to arrest inflation adversely impacted growth which
dropped to 6.9% from 8.6% in the previous financial year. The year also
witnessed a sharp deceleration in manufacturing activity mainly due to
monetary tightening, weak external demand and lack of investment
activity. The Indian automotive industry continued to grow, albeit at a
reduced rate of 7.2%. The Tata Motors Group took cognizance of the
global development and planned market actions accordingly. The Tata
Motors Group recorded a 35.0% overall growth in gross turnover from
Rs.1,26,414 crores in FY 2010-11 to Rs.170,678 crores in FY 2011-12. This
is the highest turnover recorded by the Group. The consolidated
revenues (net of excise) for FY 2011-12, of Rs.165,654 crores grew by of
35.6% over last year on the back of strong growth in volumes across
products and markets. The consolidated EBITDA margins for FY 2011-12
stood at 14.3%. Consequently, Profit Before Tax and Profit After Tax
were Rs.13,534 crores and Rs.13,517 crores, respectively. During the year
Jaguar Land Rover accounted for credit of GB£ 225million (Rs.1,794
crores) in respect of carried forward past losses in view of certainity
of utilising the losses against future profits.
Tata Motors recorded a gross turnover of Rs.59,221 crores, a growth of
15.7%, from Rs.51,184 crores in the previous year. Cost reduction and
value engineering continue to be areas of focus to improve operational
efficiency. However, the increase in commodity prices globally put
pressure on margins. Additionally, the need to increase marketing
expenses to protect and grow market share have resulted in EBITDA
margins reducing from 10.2% to 8.1%. During the year, there was an
impact of Rs.585 crores of exceptional items on account of exchange loss
(net) including on revaluation of foreign currency borrowings, deposits
and loans arising from the depreciation of Indian Rupee and provision
for impairment made for certain investments. The Profit Before Tax and
Profit After Tax for the fiscal were lower at Rs.1,341 crores and Rs.1,242
crores, as compared to Rs.2,197 crores and Rs.1,812 crores in the previous
year, respectively.
Jaguar Land Rover continued its growth in expanding markets, including
a 76% year-on-year increase in China retail sales. The strengthening of
business in China is expected to make it the largest market for Jaguar
Land Rover within the next 12 months. Jaguar Land Rover also improved
performance in more mature economies, where, despite uncertain trading
conditions, it increased sales in all major markets.
Jaguar Land Rover recorded a turnover of Rs.1,03,635 crores, a growth of
47.4% from Rs.70,304 crores in the previous year. Volume growth was
driven not only by new vehicle launches in the year, but also by
increasing sales of existing models. Profitability growth was also
benefitted from favourable exchange rates. The positive impact of the
strengthening US$ against the GB£ and the Euro, improved revenues given
a largely GB£ and Euro cost base. Further, cost efficiency improvements
in material costs and manufacturing costs supported improvement in
operational performance. These resulted in a higher EBITDA and Profit
Before Tax of Rs.17,035 crores and Rs.11,820 crores respectively, as
compared to Rs.11,478 crores and Rs.7,665 crores, respectively in the
previous year. The EBITDA margin for FY 2011-12 is 16.3%. After
recognition of previously unrecognised tax losses of Rs.1,794 crores the
Profit After Tax was higher at Rs.12,279 crores, as compared to Rs.7,073
crores in the previous year.
Tata Motors Finance Limited, the Company''s captive financing
subsidiary, registered net revenues of Rs.2,018 crores and
reported a Profit After Tax of 240 crores in FY 2011-12. Tata Motors
Finance Limited announced their maiden dividend of 5% per equity share
for FY 2011-12.
VEHICLE SALES AND MARKET SHARES
The Tata Motors Group sales stood at 12,69,483 vehicles, higher by
17.7% over the previous year. Global sales of all commercia vehicles
were at 5,99,913 units, while global sales of all passenger vehicles
were at 6,69,507 units.
Tata Motors
The Company recorded sales of 8,63,248 vehicles, a growth of 10.9% over
the previous year, in the Indian domestic market. With the industry
growing at a moderate 7.2%, the improved sales resulted in an increase
in the Company''s market share from 24.3% to 25.2%, in the Indian
industry. The Company exported 63,105 vehicles from India, against
58,089 vehicles exported last year.
Commercial Vehicles
Within the domestic market, the Company continued to strengthen its
presence in commercial vehicles, with sales of 5,30,204 units, growing
15.7% from the previous year - an all- time high for the Company. This
represented a market leadership share of 59.4% in the domestic CV
market.
Some of the highlights for the year were:
Sales in the LCV segment continued to drive performance, growing by a
healthy 23.5% during the year to 323,118 units. The ramp up of
micro-trucks - Ace Zip and Magic Iris continued, contributing to the
growth in this segment alongwith the traditional Ace and Magic family.
The Dharwad plant for the manufacture of the Zip and Iris was
commissioned as scheduled and started operations from February 2012.
However, as competition intensified, the market share dipped to 59.4%
from 62.1% last year. The new generation Tata Ultra range of trucks was
displayed at the Auto Expo and is expected to further drive growth in
this segment.
Sales in the M&HCVs segment grew moderately at 5.3%. Volumes at
2,07,086 units reflected a market share of 59.4%. This segment also
saw the entry of new players, which put pressure on the market share.
However, sales of the Tata Prima, the next generation truck continued
to grow. An increased focus on network development and customer
initiatives, laid the foundation for future growth in M&HCVs.
Passenger Vehicles
In a year where the domestic car industry grew only by 3.6%, the
Company''s sales of passenger vehicles in the domestic market (inclusive
of Tata, Fiat and Jaguar Land Rover brands) was at its highest ever at
333,044 units, representing a growth of 4.0% over the sales of previous
year. In an intensely competitive passenger vehicles market, a market
share at 13.1% was same as last year.
Some of the highlights of this year''s performance were:
Sales of the Tata Nano increased to 74,521 units, a growth of 5.8% over
last year. The Nano 2012 was launched in November 2011 in 10 new
colours, resulting in an increased demand. Measures were undertaken to
increase market penetration by establishing low-investment dealerships
in interior towns.
Sales in the Compact segment (comprising Indica V2, Indica Vista,
Indigo CS, Fiat Palio and Punto) grew by 10.5% to 1,76,104 units. The
Indica Vista refresh, the Indica eV2 and the Indigo eCS were launched
during the year, boosting sales in this segment and improving market
share to 20.6% from 19.1% last year.
Sales in the Mid Size segment (comprising Indigo and Indigo Manza) were
at 19,645 units. A slew of new entrants in this segment affected market
share, which declined to 9.6% from 21.9%.
In the Utility Vehicles (UV) segment, comprising Sumo, Safari,
Aria and Land Rover, the Company sold 49,035 units, which translated to
a growth of 16.8% and a market share of 13.3%. Sumo Gold, a new and
improved variant of the Sumo was launched in November 2011, boosting UV
sales.
In the Vans segment, market share increased to 5.2% from 0.8% as the
Venture sales continued to grow.
Fiat Sales were at 17,129 units representing a market share of 0.67%.
The Company sold 2,274 units of Jaguar Land Rover brands during the
year. Network for these brands continued to grow with 13 dealerships
across 11 cities in the Country by the year end. The assembly plant for
the Freelander in Pune assembled more than 800 units since the start of
operations during the year.
Exports
Focused efforts in select ASEAN and Africa markets helped international
exports from India grow by 8.6% to 63,105 units in the fiscal year. The
Company exported 55,079 commercia vehicles and 8,026 passenger
vehicles, a growth of 9.6% and 2.3% respectively over last year. A CKD
plant was setup in South Africa for the assembly of commercial
vehicles. Another plant is being setup in Indonesia and is expected to
start operations next year. The Company continues to have a special
focus on expanding its global footprint and is targeting product
actions specifically to cater to international geographies.
Jaguar Land Rover
Jaguar Land Rover sold 314,433 vehicles in FY 2011-12, an increase of
29.1% on the prior reporting period. At the brand level, wholesale
volumes were 54,039 units for Jaguar and 260,394 units for Land Rover,
growing 2.0% and 36.6%, over the previous year, respectively.
Retail volumes in key growth markets saw significant increases with
China and the Asia Pacific region.
Some of the highlights of this year''s performance were:
Launch of the Range Rover Evoque in September 2011 with a world-wide
roll out in December 2011, recording
sale of over 60,000 units in the first six months. The Evoque received
over a 100 awards including Top Gear Car of the Year, World Design Car
of the Year and North American Truck of the Year.
Expanded the Jaguar XF range with a more fuel efficient, 2.2 D XF with
an 8 speed automatic gear box.
The introduction of new variants of the Jaguar XF as well as the
continued strength of Ranger Rover and Range Rover Sport were key
contributors to the overall success.
Entered into a JV with Chery Automobiles, China to develop, manufacture
and sell certain Jaguar and Land Rover vehicles and jointly branded
vehicles for the Chinese market.
Announced a GB£ 355 million investment in new state-of- the-art
facility at Wolverhampton, UK, to manufacture new advanced low-emission
engines.
Tata Daewoo Commercial Vehicles Company Limited
Sales of Tata Daewoo Commercial Vehicle (TDCV) at 9,531 units were
higher by 9% from last year. Tata Daewoo Sales Company which was
established in FY 2010-11, to distribute TDCV products, has stabilized
its operation during the year enabling TDCV to focus on key accounts
and fleet customers.
Tata Hispano Motors Carrocera
Tata Hispano Motors Carrocera, S.A. (Tata Hispano) was deeply affected
by the economic downturn in Europe, particularly in Spain. Sales for
the year were at 368 units, down by 27% from last year. Tata Hispano''s
bid for and delivered a prestigious CNG series hybrid low floor bus
order for EMT Madrid during the year, demonstrating its technological
capability. The Company made a provision for investments in Tata
Hispano, arising from continuous undeperformance impacted by
challenging market conditions.
Tata Motors (Thailand) Limited
Tata Motors (Thailand) Limited (TMTL) was affected by floods in
Thailand during the year, which negatively impacted supply chain
partners and the overall demand scenario in Thailand. As a result,
volumes of TMTL at 4,978 units in FY 2011-12, were down by 17.5% from
last year. TMTL launched TDCV CNG tractors and Super Ace to boost
volumes. The Nano is also currently being tested for sale in Thailand
and has a potential to boost volumes.
Tata Motors (SA) (Proprietary) Limited
Tata Motors (SA) (Proprietary) Limited launched the Prima range of
trucks in South Africa alongwith the TDCV range of tractor trailers and
the Indigo Manza at the Johannesburg Motor Show with a view to increase
the product offerings in South Africa.
CUSTOMER FINANCING INITIATIVES
The vehicle financing activity under the brand Tata Motors Finance of
Tata Motors Finance Limited - a wholly-owned subsidiary company, posted
improved financial results through higher disbursements, focus on
controlling costs, improving quality of fresh acquisitions and
micro-management of collections. Tata Motors Finance financed 2,30,588
vehicles during the year as compared to 1,60,781 vehicles in the
previous year. Total disbursements of Rs.10,505 crores grew by 32.8%
compared to Rs.7,908 crores in the previous year. The disbursals for
commercial vehicles were Rs.7,204 crores (1,20,032 units) in FY 2011-12
compared to Rs.6,041 crores (94,446 units) for FY 2010-11. For passenger
cars, disbursals were Rs.3,301 crores (1,10,556 units) in FY 2011-12
compared to Rs.1,867 crores (66,335 units) in FY 2010-11. Market share in
terms of the Tata vehicle unit sales in India financed by Tata Motors
Finance Limited increased from 21% to 23% in commercial vehicles and
from 22% to 35% in passenger cars. Tata Motors Finance Limited
implemented a strategy to manage non-performing assets (NPA), improve
collection efficiencies and enhance the Risk Scored Pricing Model
approach. This strategy along with a thrust on customer relations
through a branch based re- organised field structure, improved
operations and profitability, creating a robust platform to enable
future growth.
For other overseas operations, the Company does not have a capital
financing company but has arrangements with local consumer finance
provides in key markets. Jaguar Land Rover has arrangements in place
with FGA Capital, a joint venture with Fiat Auto and Credit Agricole
for UK and European consumer finance, Chase Auto Finance for North
America and similar arrangements with local providers in a number of
other key markets. Tata Motors (Thailand) Limited has financing
arrangements with Thanachart Bank.
HUMAN RESOURCES
The Tata Motors Group employed 58,618 permanent employees (previous
year - 52,244 employees) as of the year end, out of which 53,011
employees were engaged in automotive operations. Tata Motors Limited
employed 29,217 permanent employees (previous year - 26,214 employees)
as of the year end. This increase supported the higher production and
sales across the Group. The Tata Motors Group has generally enjoyed
cordial relations with its employees and workers.
All employees in India belonging to the operative grades are members of
labor unions except at our Sanand and Dharwad plants. All the wage
agreements have been renewed in a timely manner and are all valid and
subsisting. Operatives and Unions support in implementation of reforms
that impact quality, cost erosion and improvements in productivity
across all locations is commendable.
Safety & Health - Performance and Initiatives
The Leadership in Tata Motors is fully committed to the ultimate goal
of employee safety. All employees at Tata Motors facilities are
progressing with the vision of Excellence in Safety. Safety reports
are reviewed at the highest level including Board meetings. Tata Motors
is working with DuPont for the improvement in safety culture towards
setting up world- class safety standards and processes and building
capability to improve and sustain a world-class safety culture. There
has been an overall 41% improvement in safety performance across units
during the year. This improvement has been recorded through the
reduction of LTI -FR (Lost Time Injury Frequency Rate) which stood at
0.44 in FY 2011-12 as against 0.74 in FY 2010-11. Improvement of
safety at offices, warehouses, depots and dealership workshops through
the development of safety norms has set expectations on safety, setting
up of Safety Committees and carrying out structured safety audits.
Safety initiatives such as the i-drive Safe campaign for improving
road and driving safety involving training of 2,500 drivers in
defensive driving were undertaken. A host of initiatives on health and
wellness were implemented with deployment of Health Index metrics
across all plants in India.
The Pantnagar plant conferred with the prestigious ''Sword of Honour'' by
the British Safety Council, UK, is a reflection of the high standards
of Health and Safety, performance and demonstration of Safety
Leadership, in all phases of operations of the plant. The Passenger Car
Business took safety management to the next level by aligning with
British Safety Council Health & Standards and by achieving a 5 Star
rating in the Audit with a score of 97.19% and 94.93% for Pune and
Sanand plant, respectively.
Jaguar Land Rover''s health and safety management system is based on the
UK Health and Safety Executive''s guidance for Health and Safety
Management - HSG65, which sets a framework for the various aspects of a
successful health and safety management system. All Jaguar Land Rover
sites in the UK are accredited with OHSAS18001 and underwent an annual
surveillance visit by the external assessors during 2011, which
verified its continued compliance to this standard. The overall
performance of Jaguar Land Rover''s has been good with reduction in Lost
Time Case rate. Jaguar Land Rover''s Occupational Health Department also
achieved accreditation to the SEQOHS standard (Safe Effective Quality
Occupational Health Standard) for its activities and management systems
within the Occupational Health facilities. An increase in headcount has
led to a requirement for increasing the Health and Safety training and
Induction programmes; with focused events around skilled workers being
recruited into functions such as plant maintenance. The business has
continued and built upon its programme of proactive health promotion
events for employees throughout the year, covering a range of topics.
A Health and Safety Week coinciding with the European Week of Safety
took place across all Jaguar Land rover sites, comprising a series of
specific events for its workforce.
Tata Daewoo Commercial Vehicles Co. Ltd, Korea recorded an incident
rate of 0.48% for FY 2011-12, at par with the total industry rate. The
Safety Index for FY 2011-12 was posted at 2.40, an improvement from
2.87 for FY 2010-11. TDCV also took a series of steps to improve their
work environment for which it was declared as Toxic free TATA DAEWOO.
Tata Motors (Thailand) Limited reported an improved safety performance.
Safety risk assessment is being reviewed for robustness, and safety
training is being enhanced. Tata Motors (SA) (Pte) Ltd completed a
baseline risk assessment and training of all its employees. The
surveillance system was enhanced for improving security. Tata Hispano
Motors Carrocera SA implemented many ergonomic projects to improve
working conditions, making it a healthy, safe and productive
work-place. Work-place environment is regularly monitored for upkeep
and tracking of progress.
FINANCE
During the year, the free cash flows for Tata Motors Group were Rs.4,601
crores, post spend on capex, design and development of Rs.13,783 crores.
Tata Motors Group''s borrowing as on March 31, 2012 stood at Rs.47,149
crores (previous year Rs.32,811 crores). Cash and bank balances stood at
Rs.18,238 crores (previous year Rs.11,410 crores).
Post spend on capex, design and development of Rs.2,835 crores, the free
cash flows were Rs.818 crores for standalone operations of the Company.
The borrowings of the Company as on March 31, 2012 stood at Rs.15,881
crores (previous year Rs.15,915 crores). Cash and bank balances stood at
Rs.1,841 crores (previous year Rs.2,429 crores).
During the year, the Company raised Syndicated Foreign currency term
loans of USD 500 million in accordance with the guidelines on External
Commercial Borrowings (ECB) issued by the Reserve Bank of India in two
tranches with tenors between four to seven years towards financing its
general capital expenditure and investments in its overseas
subsidiaries.
Tata Motors issued rated, listed, unsecured, non-convertible debentures
of Rs.500 crores with maturities of 5-7 years in May 2012, to optimize
the loan maturity profile.
During the year, post spend on capex, design and development of GB£
1,410million (Rs.10,765 crores), the free cash flows were GB£ 1,062
million (Rs.8,318 crores), for Jaguar Land Rover. The borrowings of the
Jaguar Land Rover as on March 31, 2012 stood at GB£ 1,848 million
(Rs.15,065 crores) (previous year GB£ 1,260 million (Rs.9,007 crores)).
Cash and bank balances stood at GB £2,563 million (Rs.20,891 crores)
(previous year GB£ 1,028 million (Rs.7,349 crores)) resulting in negative
net debt position.
In May 2011, Jaguar Land Rover PLC issued GB£1,000 million equivalent
Senior Notes (Notes). The Notes include, GB£500 million Senior Notes
due 2018, at a coupon of 8.125% per annum, USD 410 million Senior Notes
due 2018, at a coupon of 7.75% per annum and USD 410 million Senior
Notes due 2021 at a coupon of 8.125% per annum. This facility gave
Jaguar Land Rover an access to long tenor funding while also
diversifying its sources of funding.
In March 2012, Jaguar Land Rover issued GB£500 million Senior Notes due
2020, at a coupon of 8.25% per annum, with a yield of 8.375% per annum.
This was an opportunistic fund raising which enabled Jagaur Land Rover
to reinforce its market acceptance and demonstrated the confidence of
the investors, while continuing to support steps taken towards
strengthening capital structure and enhancing the debt maturity
profile.
During the year, Jaguar Land Rover established 3-5 year committed
Revolving Credit Facility amounting to GB£710 million. These lines,
which have been availed from 13 banks, can be drawn as per requirement
and is a step to further strengthen the capital structure.
Tata Motors Finance Limited raised Rs.155 crores by an issue of
unsecured, non-convertible, subordinated perpetual debentures towards
Tier 2 Capital to meet its growth strategy and improve its Capital
Adequacy ratio.
With healthy profitability and cash flow generation, Tata Motors was
able to further de-leverage its Balance sheet. The Consolidated Net
Automotive Debt to Equity Ratio stood at 0.25:1 on March 31, 2012
compared to 0.56:1 on March 31, 2011.
Tata Motors Group has undertaken and will continue to implement
suitable steps for raising long term resources to match fund
requirements and to optimize its loan maturity profile.
The Company''s rating for foreign currency borrowings stood at
BB-/Stable by Standard and Poor and Ba3/Stable by Moodys. For
borrowings in the local currency, the rating stood at AA- by Crisil
and at AA- by ICRA. During FY 2011-12, CARE revised the rating
upwards by 1 notch to AA. Post March 2012, Crisil and ICRA have
changed the outlook on the ratings from Stable to Positive.
As on March 2012, Jagaur Land Rover''s rating stood at B / Positive by
Standard & Poor, B1/Stable by Moodys and BB-/ Stable by Fitch. Post
March 2012, Standard & Poor has upgraded the rating to BB- retaining
the Positive Outlook.
As on March 2012, Tata Motors Finance rating stood at AA- by Crisil
and AA- by ICRA. Post March 2012, Crisil and ICRA have changed the
outlook on the ratings of Tata Motors Finance Limited from Stable to
Positive.
FIXED DEPOSITS
The Company has not accepted any public deposits during FY 2011-12. As
on March 31, 2012, the Company had deposits aggregating Rs.2,061 crores
from 1,64,022 investors. There were no overdues on account of
principal or interest on public deposits other than the unclaimed
deposits as at the year end.
INFORMATION TECHNOLOGY INITIATIVES
Information Technology supported business growth and competitiveness by
delivering strategic programs and services as identified in the Tata
Motors'' IT Strategy
Its commitment to customers is reflected in investments in the
benchmark CRM (Customer Relationship Management) solutions. This is
being used by over 3,200 channel partners and 37,000 users to handle
customer needs. Customer interactions are backed by the Tata Motor''s
Call Center which augments key business processes across pre-sales,
sales and service areas. The Center handled 30 million calls in FY
2011-12, with a consistent under 0.5 Second response time. We focused
on deploying portals for targeted customer segments like key customers,
loyalty customers, spares retailers, mechanics, State Transport
Undertakings (STUs) and defence. We are also taking CRM to
international markets in a planned manner
Tata Motors is expanding the usage of information through analytics
across the organization. eCommerce with our suppliers through SAP
Supplier Relationship Management (SRM) Solutions continues to see
greater usage. The Company strengthened the usage of IT in
manufacturing, supply chain, quality and workforce management deployed
benchmark ITIL (Information Technology Infrastructure Library)
processes, to improve the effectiveness of its IT services. Major
highlights of the year are:
Focused real life pilots in advanced analytics towards market specific
strategies.
Deployment of CRM Solution for International Business Dealers.
Solutions and capabilities built to support Rural Business expansion.
Customer focused solutions like Tata Alert (emergency breakdown), AMC
and Tata Assured (pre-owned vehicles) businesses, were supported by new
IT capabilities.
Extension of Centralized ERP Solutions and integrated WAN to the
Company''s new plant in Dharwad and South Africa and Hispano, Spain.
Manufacturing Execution Systems capabilities deployed in Ace Plant in
Pantnagar.
Support to Human Resources strategy with solution in Learning
Management System, employee on boarding and performance management.
Upgrades of the Company''s key technology platforms to newer versions.
Digital Product Development Systems Initiatives
Engineering Research Centre''s product development processes continue to
imbibe best of the breed tools and technology solutions, for enhancing
product development capabilities, addressing quality and time. Digital
product validation processes have been given focused thrust in
addressing sheet meta material variability.
Upgrades of the Company''s key CAD/CAM/CAE technology solution platforms
to newer versions.
Digital Manufacturing Planning (DMP) capabilities used to implement
out-of-the-system work instruction sheets in manufacturing lines for
CVBU, Pune plant.
In-house Knowledge Based Engineering (KNEXT) applications spread
enhanced by deploying 15 new applications in various product design
functions.
Product Lifecycle Management (PLM) now manages all digital product
design data and design processes.
MINT application, in-house developed system, in the area of ''demerits''
tracking has been institutionalized.
State of the art hardware upgrades in product development function.
Jaguar Land Rover continues to operate its globally diverse and
complicated legacy IT architectures with high levels of service and
resilience with notably few outages affecting business operations.
Jaguar Land Rover''s IT strategy includes modernisation and replacement
of old unsupported technologies;
consolidation of diverse technology platforms and suppliers;
integration of business processes through SAP ERP and creating business
value through innovation IT solutions like mobility. Major highlights
of the year are:
Deployment of SAP for Finance functions in UK.
Roll-out of common SAP for its overseas National Sales Companies.
Deployment of real time Warranty Cost and Vehicle Production Quality
Analysis.
Virtualization technologies to support globa collaboration for product
design and engineering.
Virtual Dealership using high definition rendering software and human
interaction technologies to reach more potential customers.
Tata Daewoo Commercial Vehicles Company Limited embarked on CRM
Solution deployment leveraging Tata Motors CRM. Tata Motors (SA)
(Proprietory) Limited IT set-up became operationa including SAP while
Tata Hispano Motors Carrocera (SA) started its SAP deployment. Tata
Motors is integrating its WAN with subsidiaries for seamless
operations.
Tata Motors Group companies continue their collaboration in various
information technology areas with synergies being explored for cross
utilization of IT capabilities. The group companies are working
together in areas of ERP, outsourcing and technologies. Tata
Technologies continues to be a strategic partner in strengthening Tata
Motors Group''s IT capabilities in process transformation through
technology.
NEW PRODUCT, TECHNOLOGY AND ENVIRONMENT FRIENDLY INITIATIVES
Product Development
The Tata Motors Group continues to innovate and with a view to enhance
the market share, aims at products catering to the changing needs of
the customer for both fleet owners and individual customers. Some of
the Company''s key products launched during the year and other product
development initiatives includes:
Showcased the Tata Mega Pixel - a four seater city-smart global range
extended electric vehicle (REEV) concept at the Geneva Motor Show.
Unveiled the Tata Safari Storme-a 4WD SUV powered by the 2.2 L DICOR a
engine at the Delhi Auto Expo held in January 2012.
Showcased at the New Delhi Auto Expo, the new Ultra range of Tata LCV
trucks and buses powered by the new generation 3-litre and 5-litre
engines, developed in-house. After the Prima for the M&HCV segment,
the Ultra range represents the next quantum jump in the Indian LCV
segment with world class cutting technology.
Launched the Nano 2012 - with improved mileage, better comfort and
better driveability, with 10 new refreshing colours.
Launched the Indica Vista refresh with new and improved styling.
Launched the BS IV compliant Sumo Gold powered by the 4SP DICOR engine
- with best-in-class power and drivability and improved mileage.
Showcased the Aria with improved interiors and a 6-speed automatic
transmission (AT). An AT variant on the Prima 3138 tipper was also
displayed.
Forayed into the super-luxury inter-city bus segment with launch of the
Tata Divo. Also launched new variants in the Tata Starbus Ultra range.
These products, in the mini- and mid-bus segments, will be available in
the luxury, standard and deluxe variants.
Launched the Range Rover Evoque in September 2011 and has since
garnered over 100 international awards. The class leading urban 4x4
comes in a range of trim levels and is the most customisable Range
Rover ever produced.
The Jaguar XK range was significantly refreshed with a new look for
2011. The new XKR-S, which was unveiled at the Geneva Motor Show, is
the fastest and the most powerful production sports GT that Jaguar has
ever built. The Jaguar XF 12 model year line-up included a new four-
cylinder 2.2-litre diesel version of the XF with Intelligent Stop-Start
Technology, making it the most fuel-efficient Jaguar yet.
A 3.0-litre V6 petrol engine of the Jaguar XJ was launched in the
Chinese market in early 2011, which has driven sales growth in the
year. During the year, the XJ was upgraded to include a new Executive
Package and a Rear Seat Comfort package, making Jaguar''s flagship
model, the ultimate executive limousine experience.
Showcased the Jaguar C-X16 concept car at the New York Auto Show. This
will be the basis of the new F-type, a two-seater sports car due for
launch in 2013.
The 2012 Model Year Range Rover, with an all-new 4.4-litre TDV8 engine,
aiming to achieve a 14% reduction in CO2 emissions and a 19%
improvement in fuel consumption to 7.81L/100km, was well received in
the UK, Europe and overseas.
Development of Environment Friendly Technologies
The Indigo Manza hybrid, powered by a 1.05 litre DICOR engine and
potent electric motors, has a focus on drivability and usable
performance in the real world.
The Tata Nano CNG concept was displayed at the Auto Expo with world
class safety strategies and an intelligently packaged CNG system so as
not to disturb luggage space.
A CNG variant of the Magic Iris - a stylish, comfortable and
environment friendly vehicle was displayed at the Auto Expo.
The Tata Starbus Fuel cell concept, a path breaking initiative in
alternate fuel technology, was developed with the support from the
Government of India''s Department for Scientific and Industrial
Research. In this concept, compressed hydrogen combines with oxygen to
generate electricity, which is used to power the vehicles motor and
emits only water vapour.
The all-aluminium Jaguar XJ 3.0 V6 twin-turbo diesel has
CO2 emissions rated at 184g/km
The Freelander 2 features a new eD4 diesel engine capable of
4.98L/100km and CO emissions of 158g/km in 2WD.
SUBSIDIARY AND ASSOCIATE COMPANIES
Tata Motors announces consolidated financial results on a quarterly
basis. As required under the Listing Agreement with the Stock
Exchanges, Consolidated Financial Statements of the Tata Motors Group
are attached.
Pursuant to the provisions of Section 212(8) of the Companies Act, 1956
(Act), the Ministry of Corporate Affairs vide its Genera Circular No
2/2011 dated February 8, 2011, has granted a general exemption subject
to certain conditions to holding companies from complying with the
provisions of Section 212 of the Act, which requires the attaching of
the Balance Sheet, Profit & Loss Account and other documents of its
subsidiary companies to its Balance Sheet. Accordingly, the said
documents are not being included in this Annual Report. The main
financial summaries of the subsidiary companies are provided under the
section ''Subsidiary Companies: Financial Highlights for FY 2011-12'' in
the Annual Report. The Company will make available the said annual
accounts and related detailed information of the subsidiary companies
upon the request by any member of the Company or its subsidiary
companies. These accounts will also be kept open for inspection by any
member at the Head Office of the Company and the subsidiary companies.
Subsidiary Companies
Tata Motors had 64 (direct and indirect) subsidiaries (9 in India and
55 abroad) as on March 31, 2012, as disclosed in the accounts. During
the year, the following changes have taken place in subsidiary
companies:
Subsidiary companies formed/acquired
Jaguar Land Rover (South Africa) Holdings Limited - a wholly-owned
subsidiary of Jaguar Land Rover.
PT Tata Motors Indonesia - a wholly owned subsidiary of Tata Motors
Limited.
Companies ceasing to be subsidiary companies
HV Transmissions Limited was amalgamated with TML Drivelines Limited
(formerly known as HV Axles Limited).
Land Rover Parts US LLC was dissolved.
Land Rover Deutschland GmbH was merged into Jaguar Deutschland GmBH.
Jaguar Italia SpA was merged into Land Rover Italia.
Business of Land Rover Exports Ltd was transferred to Jaguar Land Rover
Exports Ltd.
Name changes
HV Axles Limited to TML Drivelines Limited.
Jaguar Land Rover Limited to Jaguar Land Rover plc.
Jaguar Deutschland GmbH to Jaguar Land Rover Deutschland.
Land Rover Italia SpA to Jaguar Land Rover Italia SpA.
Jaguar Cars Exports Ltd to Jaguar Land Rover Exports Limited.
Other than the above there has been no material change in the nature of
the business of the subsidiary companies.
Associate companies
As at March 31, 2012, Tata Motors had 9 associate companies and 2 Joint
Ventures as disclosed in the accounts.
ENERGY, TECHNOLOGY & FOREIGN EXCHANGE
Details of energy conservation and research and development activities
undertaken by the Tata Motors alongwith the information in accordance
with the provisions of Section 217(1)(e) of the Companies Act, 1956,
read with the Companies (Disclosure of Particulars in the Report of
Board of Directors) Rules, 1988, are given as an Annexure to the
Directors'' Report.
DIRECTORS
Mr Cyrus P Mistry was appointed as an Additional Director on May 29,
2012 and Mr Ravindra Pisharody and Mr Satish Borwankar were appointed
as Additional Directors on June 21, 2012. In accordance with Section
260 of the Companies Act, 1956 (the Act) and Article 132 of the
Company''s Articles of Association, they will cease to hold office at
the forthcoming Annual General Meeting and are eligible for
appointment. M/s Pisharody and Borwankar were also appointed as
Executive Director (Commercial Vehicles) and Executive Director
(Quality, Vendor Development & Strategic Sourcing) respectively of the
Company for a period of 5 years with effect from June 21, 2012, subject
to the approval of the Members. In accordance with the provisions of
the Act and the Article of Association of the Company, M/s N Munjee, S
Bhargava and V K Jairath are liable to retire by rotation and are
eligible for re-appointment.
Attention of the Members is invited to the relevant items in the Notice
of the Annual General Meeting and the Explanatory Statement thereto.
Mr Ratan N Tata was nominated by Tata Steel as ''the Steel Director'' on
August 11, 2011 pursuant to Article 127 of the Company''s Articles of
Association in place of Dr J J Irani who retired on June 2, 2011.
Mr Carl P Forster stepped down as the Managing Director and Group CEO
on September 9, 2011, but continued to serve the Board as a
Non-Executive Member till March 31, 2012.
Mr Prakash M Telang, Managing Director - India Operations, retired from
the Company on June 21, 2012, on attaining the age of superannuation
and stepped down from the Board of the Company. The Board of Directors
expressed appreciation of the contributions made by Mr Telang over the
years to the development and growth of the Company.
CORPORATE GOVERNANCE
A separate section on Corporate Governance forming part of
the Directors'' Report and the certificate from the Practicing Company
Secretary confirming compliance of Corporate Governance norms as
stipulated in Clause 49 of the Listing Agreement with the Indian Stock
Exchanges is included in the Annual Report. Tata Motors won the Golden
Peacock Award for Excellence in Corporate Governance in 2011.
PARTICULARS OF EMPLOYEES
Tata Motors has 103 employees who were in receipt of remuneration of
not less than Rs.60 lakhs during the year or Rs.5 lakhs per month during
any part of the said year. The Information required under Section
217(2A) of the Companies Act, 1956 and the Rules made there under is
provided in the Annexure forming part of the Report. In terms of
Section 219(1)(b)(iv) of the Act, the Report and Accounts are being
sent to the shareholders excluding the aforesaid Annexure. Any
Shareholder interested in obtaining a copy of the same may write to the
Company Secretary.
CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
A separate section on initiatives taken by the Tata Motors Group to
fulfill its Corporate Social Responsibilities is included in the Annual
Report.
AUDIT
M/s Deloitte Haskins & Sells (DHS), Registration No. 117366W, who are
the Statutory Auditors of the Company, hold office until the conclusion
of the ensuing Annual General Meeting. It is proposed to re-appoint
them to examine and audit the accounts of the Company for the Financial
Year 2012-13. DHS have, under Section 224(1) of the Act, furnished a
certificate of their eligibility for re-appointment.
Cost Audit
As per the requirement of the Central Government and pursuant to
Section 233B of the Act, the audit of the cost accounts relating to
motor vehicles is carried out every year. Pursuant to the approval of
Ministry of Corporate Affairs, M/s Mani & Co. having registration No.
00004 were appointed as the Cost Auditors for auditing the Company''s
cost accounts relating to motor vehicles (including auto components),
foundry and forge for the year ended March 31, 2012.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to Section 217 (2AA) of the Act, the Directors, based on the
representation received from the Operating Management, confirm that:- -
in the preparation of the annual accounts, the applicable accounting
standards have been followed and that there are no material departures;
- they have, in the selection of the accounting policies, consulted the
Statutory Auditors and have 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 that period;
- they have taken proper and sufficient care, to the best of their
knowledge and ability, for the maintenance of adequate accounting
records in accordance with the provisions of the Act, for safeguarding
the assets of the Company and for preventing and detecting fraud and
other irregularities;
- they have prepared the annual accounts on a going concern basis.
ACKNOWLEDGEMENTS
The Directors wish to convey their appreciation to all of the Company''s
employees for their enormous personal efforts as well as their
collective contribution to the Company''s performance. The Directors
would also like to thank the employee unions, shareholders, fixed
deposit holders, customers, dealers, suppliers, bankers, Government and
all the other business associates for the continuous support given by
them to the Company and their confidence in its management.
On behalf of the Board of Directors
RATAN N TATA
Chairman
Mumbai, June 21, 2012 |