MARUTI SUZUKI INDIA LIMITED
ANNUAL REPORT 2011-2012
DIRECTOR`S REPORT
Your directors have pleasure in presenting the 31st annual report together
with the audited accounts for the year ended 31st March 2012.
FINANCIAL RESULTS
The Company`s financial performance during the year 2011-12, as compared to
the previous year 2010-11 is summarised below:
(Rs. in million)
Particulars 2011-2012 2010-2011
Total revenue 364,139 371,272
Profit before tax 21,462 31,088
Tax expense 5,110 8,202
Profit after tax 16,352 22,886
Balance brought forward 118,578 100,499
Profit available for appropriation 134,930 123,385
Appropriations:
General reserve 1,635 2,289
Proposed dividend 2,167 2,167
Corporate dividend tax 351 351
Balance carried forward to balance sheet 130,777 118,578
FINANCIAL HIGHLIGHTS
The total revenue (net of excise) was Rs. 364,139 million as against
Rs.371,272 million in the previous year showing a marginal decline of 1.92
per cent. Sale of vehicles in the domestic market was 1,006,316 units as
compared to 1,132,739 units in the previous year. Total number of vehicles
exported was 127,379 as compared to 138,266 in the previous year.
Profit before tax (PBT) was Rs. 21,462 million against Rs. 31,088 million
and profit after tax (PAT) stood at Rs. 16,352 million against Rs. 22,886
million in the previous year.
DIVIDEND
The board recommends a dividend of Rs. 7.50 per equity share of Rs. 5 each
for the year ended 31st March 2012 amounting to Rs. 2167 million.
OPERATIONAL HIGHLIGHTS
The operations are exhaustively discussed in the report on `Management
Discussion and Analysis` which forms part of this annual report.
CRISIL RATINGS
The Company has been awarded the highest financial credit rating of
AAA/stable (long term) and A1+ (short term) on its bank facilities by
CRISIL. The rating underscores the financial strength of the Company in
terms of the highest safety with regard to timely fulfillment of its
financial obligations.
QUALITY
The Company has again been awarded ISO:27001 certification by STQC
Directorate (Standardisation, Testing and Quality Certificate), Ministry of
Communications and Information Technology, Government of India after re-
assessment. The Company is thus certified to meet international standards
for maintaining information security.
During the year, ISO 14001 re-certification audit was carried out by M/s
AVI, Belgium and the auditors renewed the ISO 14001 certificate till 2014.
The quality management system of the Company is certified against ISO
9001:2008 standard. Re-assessment of the quality systems are done at
regular intervals by an accredited third party agency.
AWARDS/RECOGNITION/RANKINGS
* J D Power Customer Satisfaction Index (CSI) Study ranked the Company
highest for the 12th time in a row.
* J D Power Asia Pacific 2011 India Vehicle Dependability Study ranked Zen
Estilo and Swift DZire as the `most dependable cars`.
* JD Power IQS ranked Zen Estilo and Swift DZire highest in the `compact`
and `entry midsize` segment respectively.
* J D Power APEAL Study 2011 ranked Alto and Zen Estilo highest in the
`compact` segment. Swift DZire received an award in the `entry midsize car`
segment for a fourth consecutive year.
* CNBC TV 18 Overdrive awarded `Compact Car of the year 2012` to new Swift.
* NDTV CNB`s `Premium hatchback of the year` awarded to new Swift.
* BBC India Top Gear`s `Small car of the year 2011` awarded to new Swift.
* ICOTY 2012 `Indian Car of the Year 2012` awarded to new Swift.
* Bloomberg UTVi`s `Compact Car of the Year` awarded to new Swift.
Mr. R. C. Bhargava, Chairman was bestowed with `The Order of the Rising
Sun, Gold and Silver Star` by His Majesty Emperor Akihito of Japan.
SUBSIDIARY COMPANIES AND THEIR ACCOUNTS
The Company`s subsidiaries which were engaged in the business of insurance
distribution in the past generated an investment income of Rs. 163.80
million including a dividend income of Rs. 28.65 million and long term
capital gain of Rs. 129.13 million through mutual funds.
The Company`s subsidiary `True Value Solutions Limited` has contributed
towards smooth operations of business processes and supported the
dealerships in enhancing the sale of certified pre-owned cars under the
brand `Maruti True Value`. It has contributed significantly to the efforts
of customer retention by facilitating sale and re-purchase of new cars
through exchange and has made significant contribution towards enhancing
dealers` profitability.
In terms of the general circular dated 8th February 2011 issued by the
Government of India, Ministry of Corporate Affairs, the balance sheets,
profit & loss accounts, reports of the board of directors and auditors of
the subsidiary companies have not been attached with the balance sheet of
the Company. Annual accounts of the subsidiary companies and the related
detailed information shall be made available to shareholders of the Company
and subsidiary companies seeking such information at any point of time. The
annual accounts of the subsidiary companies shall also be available for
inspection by any shareholder at the head office of the Company and of the
subsidiary companies. Hard copy of details of accounts of subsidiaries
shall be furnished to any shareholder on demand. Further, pursuant to
Accounting Standard - 21 issued by the Institute of Chartered Accountants
of India, consolidated financial statements presented by the Company
include the financial information of its subsidiaries.
HUMAN RESOURCE DEVELOPMENT
The Company provides tremendous learning and development opportunities to
its employees starting from induction and orientation when a new employee
joins the Company. The Company believes that to have a sustainable
competitive advantage in the new knowledge economy, learning would be the
key catalyst for an organisation`s survival and success. The Company`s
extensive training calendar encompasses training programs for all
categories of employees i.e. associates, supervisors and those at junior,
middle, senior and top management level. To have a well rounded development
of employees, the training calendar comprises of behavioral, functional and
safety trainings. The training programmes vary according to the need of the
employees at various levels and business requirements and are designed
after doing a thorough process of three stage need identification.
In 2011 - 12, a total of 47,000 man-days of training were conducted for
employees across all the levels. This translates to an average of 5.15 days
of training per employee.
Functional and technical trainings form an important part of the Company`s
annual training calendar as they are directly linked with employees` on the
job performance. These trainings are imparted by in-house subject matter
experts as well as by external trainers. Some of the functional trainings
imparted internally are 3G, 3K, 5S, DFMEA and QC tools. Few functional
trainings which are being done by external trainers are finance for non-
finance, six sigma, project management, inventory & warehouse management,
world class manufacturing practices, auto cad, MS excel, etc.
Behavioral trainings also form a considerable portion of the training
calendar and include trainings like negotiation skills, problem solving &
decision making skills, presentation & communication skills, conflict
management & resolution, assertiveness & self confidence, time management &
multi tasking skills, leading effectively, inter personal relationships,
etc.
The Company also has higher education schemes for its employees. It helps
not only to groom and retain high potential young managers but also enables
employees to fulfill their career enhancement aspirations. The scheme
includes programs like - executive MBA (full time and part time) at select
campuses. The scheme is available for employees at levels of assistant
managers to managers and is guided by eligibility and selection criteria.
DIRECTORS
Mr. R. C. Bhargava, Mr. Kazuhiko Ayabe and Ms. Pallavi Shroff, directors of
the Company, retire by rotation at the ensuing annual general meeting and
being eligible, offer themselves for re-appointment. Mr. Shuji Oishi
resigned from the post of Director and Managing Executive Officer
(Marketing & Sales) with effect from the close of the business hours of
27th April 2012. Mr. Kazuhiko Ayabe was appointed as Director and Whole-
time Director designated as Director & Managing Executive Officer (Supply
Chain) with effect from 28th April 2012 subject to the approval of the
shareholders in general meeting to fill the casual vacancy caused by the
resignation of Mr. Shuji Oishi. Mr. Kinji Saito was appointed as an
Additional Director and he holds office upto the date of the 31st annual
general meeting of the Company.
DIRECTORS` RESPONSIBILITY STATEMENT
As required under section 217(2AA) of the Companies Act, 1956, your
directors confirm:
a) that there were no material departures in the applicable accounting
standards followed while preparing the annual accounts;
b) having 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 that period;
c) having 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
d) having prepared the annual accounts on a going concern basis.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS
AND OUTGO
A statement giving details of conservation of energy, technology
absorption, foreign exchange earnings and outgo in accordance with the
Companies (Disclosure of Particulars in the Report of Board of Directors)
Rules, 1988 is annexed as Annexure A.
PERSONNEL
As required by the provisions of section 217(2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975, as
amended, the names and other particulars of the employees are set out in
Annexure B to the Directors` Report. However, as per the provisions of
section 219(1)(b)(iv) of the Companies Act, 1956, the annual report is
being sent to all the shareholders of the Company excluding the aforesaid
information. Any shareholder interested in obtaining such particulars may
write to the Company Secretary at the registered office of the Company.
CONSOLIDATED FINANCIAL STATEMENTS
In accordance with the Accounting Standard - 21 on Consolidated Financial
Statements read with Accounting Standard - 23 on Accounting for Investments
in Associates and Accounting Standard - 27 on Financial Reporting for
Interest in Joint Ventures, the audited consolidated financial statements
are provided in the annual report.
CORPORATE GOVERNANCE
The Company has complied with the corporate governance requirements, as
stipulated under clause 49 of the listing agreement and the stipulated
certificate of compliance is contained in this annual report.
AUDITORS
The auditors, M/s Price Waterhouse, Firm Registration Number FRN301112E,
Chartered Accountants, hold office until the conclusion of the ensuing
annual general meeting and are recommended for re-appointment. A
certificate from the auditors has been received to the effect that their
re-appointment, if made, would be in accordance with section 224 (1B) of
the Companies Act, 1956.
COST AUDITORS
In conformity with the directives of the Central Government, the Company
has appointed M/s R. J. Goel & Co., cost accountants, as the cost auditors
under section 233B of the Companies Act, 1956 for the audit of the cost
accounts for the motor vehicles business for the year ending on 31st March
2013. The due date of filing the cost audit report for the financial year
2010-11 was 30th September 2011. This report was filed on 13th September
2011 with the Ministry of Corporate Affairs.
ACKNOWLEDGMENT
The board of directors would like to express its sincere thanks for the co-
operation and advice received from the Government of India and the Haryana
Government. Your directors also take this opportunity to place on record
their gratitude for timely and valuable assistance and support received
from Suzuki Motor Corporation, Japan. The board also places on record its
appreciation for the enthusiastic co-operation, hard work and dedication of
all the employees of the Company including the Japanese staff, dealers,
vendors, customers, business associates, auto finance companies, state
government authorities and all concerned without which it would not have
been possible to achieve all round progress and growth of the Company. The
directors are thankful to the shareholders for their continued patronage.
For and on behalf of the board of directors
Shinzo Nakanishi R. C. Bhargava
Managing Director & CEO Chairman
New Delhi,
29th May 2012
Annexure-A
Information in accordance with the Companies (Disclosure of Particulars in
the Report of Board of Directors) Rules, 1988, and forming part of the
Directors` Report for the year ended 31st March 2012.
A. ENERGY CONSERVATION
The Company continued its energy conservation drive more prominently
through various energy saving activities and adaptation of new technology.
Energy saving initiatives throughout the plant helped the Company in
reducing energy consumption by 2 per cent in most of the areas. Some of the
activities carried out during the year towards environment, energy and
water conservation are mentioned under:
* Fluidised bed type incinerator was installed in Manesar plant for
cleaning of paint booth gratings instead of direct burning type incinerator
to reduce emission.
* In order to utilise the exhaust gases of the Gas Turbine Generators
(GTGs), Waste Heat Recovery Boilers (WHRB) & Steam Turbine Generators
(STGs) were installed in Gurgaon plant which will reduce the cost of energy
by 20 per cent.
* Newly built plant at Manesar was designed in a special way so as to make
maximum use of natural light.
* New generation Electro Deposition (ED) paint coating on car body was
introduced which operates at low voltage and thus consumes less energy.
* Gravity conveyors were used in weld shop.
* Light Emitting Diodes (LED) lights were used in shop floors in
stockyards, Manesar and Gurgaon plant.
* Aerodynamic energy efficient Fibre Reinforced Plastic (FRP) blades were
used in lieu of standard blades for cooling towers which consume less
energy.
* Voltage was optimised in shops for lighting and motor loads.
* Improvement was achieved in efficiency of air washers by replacing spray
zone with celdec media.
* Desiccant type air dryers were introduced to reduce energy consumption.
* Direct cooling type system was introduced for air conditioning system.
* Utilisation of cooling towers was optimised.
* Energy efficient motors were used in water treatment plant at Manesar.
* Use of natural light was substituted for artificial lights for achieving
energy saving.
* Air cooled cooling towers were used in Gurgaon and Manesar plants.
* Air cooled air dryers were used in compressed air plant.
* Usage of recycled water was increased in lieu of fresh water.
B. RESEARCH & DEVELOPMENT
The Company`s R&D team has been working with the following vision - "Build
on our engineering skills to design and develop cars to delight the Indian
consumer and establish Maruti as the R&D hub of Suzuki Motor Corporation
(SMC) in Asia outside Japan."
The Company has envisioned the path of achieving the vision through:
* New model and minor change design and development; and
* Engineering capability development for design and development of full
body change.
The Company has taken every possible step to scale up its R&D strength and
infrastructure.
Skilled manpower is the key for achieving the goals of any company. The
Company has increased the strength of R&D manpower from 1070 numbers in
2010-11 to 1210 numbers in 2011-12. The Company has a plan of increasing
this manpower from 1210 numbers to more than 1400 numbers in 2012-13.
As a part of capability enhancement, engineers from the Company are trained
at Suzuki Motor Corporation, Japan in respective areas.
The previous year was a significant year for the Company in terms of
investments in new facilities. The Company has started its work for new
world class testing and evaluation facility at Rohtak, Haryana. The
Company`s R&D center at Rohtak will be equipped with latest R&D
infrastructure and world class test tracks. This is a significant step for
development of future new models.
New state of the art testing facilities and equipment have been set up for
evaluation of new generation engines. In order to meet the future emission
regulations, testing facilities have been set up for both diesel and petrol
engine evaluation. Reduction of friction in the engine is one of the
important measures for improving the fuel efficiency. New facilities have
been set up for analysing and building capability for reduction of the
friction in engine parts. In pursuit of giving best in Noise Vibration &
Harshness (NVH) performance, a new facility has been set up for analysing
the NVH performance of the vehicles.
Apart from the facilities, the Company has also consistently focused on
increasing the R&D efficiency through the implementation of new softwares
and systems as under:
Integrated bill of material: Different stages of preparation of bill of
material have been reduced by implementation of integrated bill of material
that has resulted in efficient and effective management.
Project management software: It has been implemented for improving process
efficiency during product development cycle. All the sourcing and
development activities have been integrated using single software for
efficient coordination and monitoring.
Knowledge enhancement and cost awareness: Teardown and benchmarking
activity was taken up as a uniform and focused approach to keep the Company
updated on the emerging technologies and design solutions. The gathered
knowledge was provided at a click of button to the Company`s engineers
through teardown management system.
Specific areas in which R&D has been carried out
a. Significant efforts have been taken in preparation of product road map,
product specification, tracking of new technology and its implementation.
Market research activities are periodically conducted to capture customer
voice and incorporate customer feedback in the existing and future
products.
b. Enhancement of focus on capturing design trends for producing exterior
and interior designs which depict the right design language suiting the
taste of Indian consumers and thus resulting in a right product for the
Indian market. Capability enhancement was done in designing and showcasing
new concept models. As a step towards this, the Company showcased the
concept XAa in 2012 Auto Expo held in Delhi. The concept XAa combines the
traditional attributes of a Sports Utility Vehicle (SUV) with elegance and
compactness.
c. Capability development has been made in the areas of vehicle ergonomics,
human engineering and competitor vehicle benchmarking. Simulation softwares
of virtual human ergonomics have been implemented for incorporating
ergonomic requirements at the design phase itself.
d. In order to meet growing demand for fuel efficient vehicles, R&D has
done significant work in the implementation of new technologies like
Variable Valve Timing (VVT) and development of low friction valves and low
viscosity oils.
e. To reduce the overall development time, capability development has been
done in the areas of virtual validation for transmission design.
f. Research in the area of new materials i.e. steel and polymer for Body in
White (BIW) and interior parts has helped in using stronger, lighter and
safer materials. High strength steel usage in BIW has been implemented in
many models. In parts design and development, new technologies like
tailored welded blanks are being considered for cost efficiency and weight
reduction. For improving the quality and antirust performance, more GA
(Galvanised) steel usage has been implemented.
g. Capability up-gradation has been done in areas of brake design and
development to meet growing expectations and rigorous demands of brake
system in India`s traffic conditions. Rear torsion beam of new Swift, DZire
and Ertiga have been designed with low weight maintaining higher torsion
rigidity than conventional design. The formed, high tensile pipe profile
optimises weight and vehicle performance. New Swift (Gasoline) is equipped
with shudder less angular contact joints having superior plunging and NVH
performance at higher working angles.
h. The design prototype capability has been enhanced to include complete
body shell and vehicle build for full body change. Capability development
has been done in areas of building vehicles with alternative engineering
specifications (body structures, materials, configuration etc.) for design
and product optimisation.
i. Cost control is one of the major activities under constant focus in R&D.
For new models, detailed feasibility analysis is done and stringent cost
targets are set up. Raw material, commodities and foreign exchange
fluctuations during the project life cycle are closely monitored and
corrections are done to meet the cost targets. In order to reduce costs
right from concept stage, cost analysis and design to cost techniques have
been adopted. Value Engineering (VE) ideas of the Company`s engineers and
also the suppliers have been incorporated at the design stage itself. Focus
on incorporating India specific cost reduction ideas right at the design
stage for global models is helping the Company in achieving stricter target
costs. For existing models, focused activities for cost down were taken up
in various models by cross functional teams to provide the higher value
products. To de-risk from foreign exchange exposure and to reduce supplier
cost substantially, the localisation of supplier`s imported parts was taken
up as a planned activity. The Company saved Rs. 80.73 crores by
localisation and Rs. 128.48 crores from implementation of Value
Analysis/Value Engineering (VA /VE) proposals.
j. Experimental projects in the field of hybrid / electric vehicle were
taken up by the Company. Subsequent to the demonstration of SX4 hybrid and
EECO electric demonstration at the Common Wealth Games 2010, various study
projects were taken up in the field of Electric Vehicles - Hybrid Electric
Vehicles (EV-HEV) to improve design capability.
Benefits derived as a result of above R&D
New launches
a) Launch of new Swift and new Swift DZire.
b) Showcase of Ertiga in Auto Expo held in Delhi.
c) Launch of model A-Star with minor change.
d) Showcase of XAa concept in Auto Expo held in Delhi.
e) Filing of 25 patents by R&D in India.
Future plan of action
The Company will continue to introduce new products to meet growing
customer expectations. The existing products will be refreshed at regular
intervals to suit the upcoming trends. The Company is pro-actively working
on increasing the fuel efficiency of all its models to offer affordable and
environment friendly vehicles to the customers. One of the significant
steps is to introduce alternate fuel options like Liquefied Petroleum Gas
(LPG) and Compressed Natural Gas (CNG) in the Company`s vehicles. The
Company will continue to focus on developing more products with alternate
fuel options. In the long term, the Company is focusing on enhancing the
capability in the field of EV-HEV and other environment friendly
initiatives. Another step towards making vehicles more affordable is by
maintaining the vehicle cost through VA/VE and weight reduction activities.
The Company is continuously working on alternate materials and newer
technologies to reduce the vehicle cost and weight. Safety of the customers
is of primary importance to the Company. The Company is focusing on new
technologies to enhance the safety of the occupants and also meet the
future safety regulations.
C. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION
Efforts in brief made towards technology absorption, adaptation and
innovation
* Design of components and systems including design review process.
* Component and sub component level localisation, development and testing
of parts for existing and new models.
* Capabilities enhanced in component and vehicle evaluation, benchmarking
and design optimisation.
* Capabilities being further enhanced in area of alternative fuels.
* Value Engineering (VE) at the time of new model design to maximise cost
benefit.
* Capability enhanced in the development of new technologies at affordable
prices.
Benefits derived as a result of the above efforts
The Company was able to achieve high level of localisation in all the
models resulting in reduction of cost. The Company was also able to offer
new technologies benefiting its customers. The Company has also worked
significantly in the areas of fuel efficiency and weight reduction.
Technology inducted
The Company has been a pioneer in offering latest technologies at
affordable prices to its customers. As a market leader, the Company intends
to keep this momentum in future. Some of the steps taken in this direction
are as under:
* The all new powerful and light weight K14 engine was introduced in
Ertiga. The engine is an extension of the successful K-series line-up.
* New Swift and Swift DZire were made equipped with `detent pin technology`
for improving the shift comfort. This has helped in enhancing the customer
satisfaction.
* New Swift, Swift DZire and Ertiga were made equipped with new generation
Anti-lock Braking System (ABS) which is the smallest and lightest system in
the Company`s line-up. New technology Engine Drag Control (EDC) was
introduced which proves the technological superiority of the Company`s
vehicles. The EDC prevents locking of driving wheels due to engine braking,
thereby ensuring the drivability and steerability while braking in slippery
conditions.
* New Swift and DZire were made equipped with the latest 3rd generation
wheel bearing units. It brings a reduction of over 20 per cent in weight
over first generation unit with additional advantages of controlled pre-
loading, enhanced rigidity and improved bearing performance.
* Fuel efficiency of the vehicles being the prime focus, Variable Value
Timing (VVT) was introduced in gasoline versions of new Swift, new DZire
and Ertiga to improve the fuel efficiency and performance. Other measures
like valve train friction reduction in K12 and K14 engines and introduction
of low viscosity engine oils in diesel engines have been taken to improve
the fuel efficiency.
* The Company has always been the forerunner in implementing new
environment friendly measures. New Swift and Swift DZire are compliant with
On Board Diagonosis (OBD) -II Regulations and thus are much ahead of the
requisite time of implementation of these regulations i.e. April 2013.
Year of Import: 2011-12
Status of absorption: Above technologies have been used in products
introduced during the year.
Expenditure incurred on R&D
(Rs. in million)
Particulars 2011-12 2010-11
A Capital Expenditure 1,491 2,316
B Recurring Expenditure 2,204 1,847
TOTAL 3,695 4,163
Total R&D expenditure as a 1.01% 1.12%
percentage of total income
D. FOREIGN EXCHANGE EARNINGS & OUTGO (ACCRUAL BASIS)
(Rs. in million)
Particulars 2011-12 2010-11
Foreign exchange used: equivalent
Raw materials and 30,451 29,691
components
Capital goods 11,625 8,250
Dies & moulds, 1,147 1,103
maintenance spares & other items
Royalty, interest, dividend 25,564 24,323
and others
Foreign exchange earned: 36,918 34,988
equivalent
Activities relating to exports:
i) Initiatives taken to increase exports: The Company exported a total of
127,379 units during the year. While the exports to non-European markets
increased from 79,047 units to 84,332 units, total exports crossed a
landmark of 950,000 units.
ii) Development of new export markets for products and services: The
Company focused on introducing products in new markets. Two new markets
i.e. South America Columbia and Dominican Republic were started.
iii) Export plans for future: The focus will be on export of small cars in
2012-13 considering the macroeconomic and socio-political conditions
globally.
For and on behalf of the board of directors
Shinzo Nakanishi R. C. Bhargava
Managing Director & CEO Chairman
New Delhi
29th May 2012
MANAGEMENT DISCUSSION AND ANALYSIS
OVERVIEW
The financial year 2011-12 was full of challenges and turbulence for the
Indian passenger vehicle industry. With a background of two good years of
8.4 per cent economic growth, the financial year 2011-12 began on an
optimistic note. However, during the course of the year it became evident
that the Indian economy would fall short of these expectations and the GDP
growth in 2011-12 is now estimated to be around 6.5 per cent. It was the
second year in succession with a double digit inflation rate and the
central bank raised interest rates to curb inflation. Prices of crude oil
also shot up in the international market. With petrol prices deregulated
the previous year, and diesel prices under government control, there was a
high difference in the prices of the two fuels. This led to a severe demand
distortion between petrol and diesel cars. High inflation, high interest
rates and high petrol prices impacted affordability of cars, particularly
in the smaller cost-sensitive segment. The Indian passenger vehicle market
grew by a meagre 4.7 per cent. Sales of petrol cars declined by 13.7 per
cent in the domestic market while diesel car sales grew by 37.4 per cent
with an additional wait list of customer bookings owing to capacity
constraints. If the market is segmented on size, the sales of bigger cars
(A3 segment and above) grew by 17.5 per cent and of utility vehicles by
16.5 per cent, while those of small and compact cars declined by 1.4 per
cent.
The global economic environment was also uncertain following a natural
calamity in Japan, a downgrade of credit rating of the U.S.A. and a
sovereign debt crisis in the Eurozone. The latter continues to be a
dominant global factor and a source of volatility in the financial and
currency markets. While export sales of the Company`s products to the
European markets plummeted, the fall in volumes was made up to some extent
by increase in sales to non-European markets.
On the cost side, a steep appreciation of the Yen increased the Rupee cost
of direct and indirect imports and royalty. Although there was some benefit
on export realisations, the quantum was limited.
The Company suffered an unfortunate labour unrest situation at its Manesar
facility. Since then, the management has taken measures to promote cordial
industrial relations. The unrest impacted the production of vehicles,
including in the diesel segment, which were in high demand.
The competitive intensity also increased with new model launches including
in small and compact segment and aggressive price cuts. Since the Company
is present predominantly in the small car segment and in petrol cars, and
did not have a sizeable presence in utility vehicle segment, it was
impacted more than industry as a whole and domestic sales fell by 11.2 per
cent to 1,006,316 units. Net Sales, including exports, stood at Rs. 347,059
million, a decline of 3.2 per cent over the previous year. Efforts to
revive the market by higher discounts and sales promotion activities,
together with higher commodity prices and adverse foreign exchange rates,
put pressure on profit. Net Profit after tax declined by 28.6 per cent to
Rs. 16,351 million.
While the year was marked by challenges on several fronts, the Company
continued to take significant measures for the long term in the areas of
capacity expansion, brand building, product development and network
expansion. Customers rated the Company the best in customer satisfaction in
India for the twelfth consecutive year in the J.D. Power survey. The
Company launched refined versions of its Swift and DZire models, even while
they were at the prime of sales and customer demand. The new models were
received well and sales have increased further. During the year, the
Company commissioned a second car plant at Manesar and augmented
availability of diesel engines by outsourcing with the help of Suzuki Motor
Corporation. Work on the development of a new R&D centre at Rohtak
progressed according to schedule. The Company entered the utility vehicle
space with the showcasing of a new model, the Ertiga. The Ertiga, designed
as an alternative to sedans and targeted at families upgrading from compact
and mid-size cars, has received a positive response and order books are
full for the next few months.
BUSINESS PERFORMANCE
Domestic Market
During the year, market conditions remained tough due to high interest
rates, high petrol prices and an uncertain political and economic
environment. As mentioned above, the difference between petrol and diesel
prices shot up causing a further decline in the demand for petrol vehicles
and a customer waitlist for diesel vehicles. The percentage of diesel
vehicles in domestic passenger vehicle sales increased from 36 per cent in
2010-11 to 47 per cent in 2011-12.
The sales of diesel models of the Company were limited by capacity
constraints and therefore had a long customer waitlist for delivery built
up during the year. Towards the fourth quarter of the year, the Company
enhanced diesel engine availability by outsourcing from Fiat India
Automobiles Limited. The competition launched new models and in several
cases announced aggressive discounts and price cuts. The market share in
passenger vehicles declined from the past levels of about 45 per cent to
38.4 per cent. However, the Company will make efforts to recover market
share in the next few years given the popularity of its diesel models,
enhanced diesel engine availability, renewed focus on efficient petrol
vehicles and strong new launches, among other reasons. Four out of the top
five selling models in India in the year were from the Maruti Suzuki
stable.
During the year, the Company launched refreshed variants of the Swift and
the DZire. These brands have been on waiting lists for delivery since their
launch. The first Swift, launched six years ago, created great enthusiasm
in the Indian passenger vehicle market with its contemporary European
design, styling, features and performance. DZire is an attractive package
for an urban family, offering plush, comfortable interiors and superior
fuel efficiency. Maruti and Suzuki engineers ventured on the tough task of
surpassing existing standards in their efforts together to enhance further
the styling, features and fuel efficiency of the cars. The market response
to the new models has been satisfying and the combined volumes have shot up
from about 22,000 units to over 30,000 units per month.
At the 2012 Delhi Auto Expo, the Company unveiled the Ertiga - Life Utility
Vehicle. The global premiere of Ertiga marks the entry of the Company in
the UV segment, which will help further strengthen its leadership position
in the industry. The Company also showcased the XA-Alpha, a concept compact
SUV.
The Company continues to focus on network expansion to remain close to
customers. During the year, the dealer sales network reached 1,100 outlets
in 801 cities and total service points expanded to 2,958 workshops in 1,408
cities. The Company is the only passenger vehicle manufacturer to achieve
more than one thousand sales outlets in India.
Higher network penetration helps in capturing more sales from across
geographies. The Company has the highest presence in terms of district
coverage at 82 per cent. The rural segment has grown at a fast pace in the
last 5 years. Better road infrastructure, higher minimum support prices and
government social schemes have had a positive impact on the rural economy
and increased purchasing power as well as aspiration levels. Rural sales,
even in such a tough year, remained healthy and robust. In the year, rural
sales contributed more than 25 per cent of total domestic sales.
The Company`s workshop network has about 25,000 dealer service technicians
trained in technical skills and customer friendly processes. This has
contributed to the Company being rated the best in Customer Satisfaction
in India for the twelfth consecutive year in the JD Power Asia Pacific
survey. For reducing the transit time and faster delivery of vehicles and
parts to the southern states, the Company opened a transit vehicle park for
vehicles and parts distribution centre at Bangalore.
The integrated business model of the Company`s dealerships proved valuable
in a difficult year. The TrueValue business is an effective tool to promote
new car sales by offering a hassle-free way for customers to exchange old
cars for new or otherwise. During the year, dealerships sourced and sold
over 230,000 pre-owned cars. Of these nearly 90 per cent resulted in
exchange buying of new cars.
Parts & Accessories
The Company`s large vehicle parc continued to drive demand in the
aftermarket. To educate customers and encourage use of genuine parts for
safety and better performance, it employed radio campaigns, service checkup
camps and carried out other marketing activities. The Company worked on the
retail network for easy availability and expanding the range of accessories
by introducing more than 300 new products.
Parts and accessories achieved a gross turnover of Rs. 23, 385 million, a
growth of 16 per cent over the previous year.
Exports
The export business was challenged by the weak global economic scenario,
particularly in the European market.
The Company made strong efforts to develop the non-European markets and
this compensated to a large extent for the fall in European sales. The
Company worked in
close co-ordination with the distributors and implemented various sales
enablers and best practices that resulted in robust sales and improved
brand presence. Non-European markets now account for 66 per cent of total
exports up
In the year, the Company exported 127,379 vehicles, a decline of 8 per cent
over the previous year. The Company`s premium small car A-star with low CO2
emission was the single largest selling model and its cumulative sales
crossed the milestone of 300,000 units.
SUSTAINABILITY
The sustainability efforts of the Company focus on three dimensions of its
performance - economic, environmental and social. The Company considers its
various stakeholders to be essential partners in its sustainability journey
and regularly reviews its stakeholder engagement mechanisms to address
their concerns and needs in a proactive and progressive way.
The Company has made numerous improvements within the boundaries of its
manufacturing facilities over the years. In 2011-12, the Company became the
first automobile company in the country to register a Clean Development
Mechanism (CDM) project with United Nations Framework Convention on Climate
Change (UNFCCC). In due course, the project will allow the Company to earn
tradable carbon credits.
The Company promoted sensitivity for the environment amongst its suppliers
as well. The Company`s corporate social responsibility (CSR) projects
continued to expand in the year. Road safety, the Company`s largest CSR
project, laid high focus on driver training for increasing safety on Indian
roads. Besides, emphasis was laid on spreading awareness on road safety
among school children and the general public. The Company had set a goal of
training 500,000 persons in safe driving under its National Road Safety
Mission in 2008. Of this, 100,000 were to be from the underprivileged
sections of the society. The Company completed its 3-year training goal in
December 2011. Many of the underprivileged trained in driving are using
their skill to earn a living, either by joining an existing enterprise or
setting up their own business. The driving training network of the Company
consists of Institutes of Driving and Traffic Research (IDTRs), run in
collaboration with state governments and Maruti Driving Schools (MDS),
neighbourhood training centres owned and managed by the Company`s
dealerships. There are now 6 IDTRs across the country and over 200 Maruti
Driving Schools. During the year, the Company crossed the milestone of
training 1 million people in safe driving in the last one decade.
The Company`s skill training programme expanded with new partnerships with
Government Industrial Training Institutes (ITIs). The Company is working in
close partnership with state government, for overall up-gradation of 10
Institutes, including two ITIs for women and one ITI for Scheduled Cast /
Scheduled Tribe students. Besides these Institutes, the automobile trade
was upgraded in 38 ITIs across the country.
Development activities in four Manesar villages continued smoothly in the
year. The key activities were school education, infrastructure development
and skill training for employment. For initiating activities in four
villages in Gurgaon, the Company undertook a needs assessment of the area.
Focused activities will begin in these locations in the coming year.
Expressing commitment to workplace safety, the Company underwent the
Occupational Health and Safety Assessment Sequence (OHSAS) 18001
Certification in 2011-12. Over 100,000 man-hours of safety training were
provided in 2011-12.
The Company measures and shares its performance in the area of
sustainability with stakeholders in the form of a sustainability report.
The report is in accordance with Global Reporting Initiative (GRI) G3
guidelines and is externally assured with an A+ certification. The full
report can be accessed on http://www.marutisuzuki.com/ sustainability-
report.aspx
OPERATIONS
The aggregate decline of 11.2 per cent in the domestic market in the year
was accompanied by fluctuations in demand in each quarter, and also across
models. There were changes in production lines for new versions of Swift
and DZire and changes in the diesel and petrol product mix. This placed
demands on the ability of the manufacturing operations and vendors to meet
the fluctuating needs of the market while staying lean with inventories.
total space. The plant was commissioned in September with substantial
reduction in investment cost.
The Company has identified four pillars of manufacturing excellence -
Safety, Productivity, Quality and Cost Reduction and these are achieved by
involving all the employees in both generation of ideas and in execution.
The Japanese practice of kaizen involves every employee looking for small
and continuous improvement in his/her work area. The total adds up to big
benefits in cost reduction, waste elimination, productivity and quality
improvement. An additional advantage is that it engages and empowers
employees and tries to leverage the entire organisation`s potential. The
Company holds regular competitions in suggestion schemes and quality
circles and duly recognises the high performers.
The manufacturing operations comprising three plants at Gurgaon and one
plant at Manesar tried to meet customers` requirements with flexibility and
agility. A second plant was commissioned in Manesar taking the installed
capacity of the Company to 1.26 million units per annum. However, with
productivity improvements and kaizen or continuous improvement over the
years, the Company is able to achieve a throughput of 1.5 million units per
annum.
This second plant is built with high automation levels, world class
facilities, ergonomically designed equipment and advanced technologies. It
has capacity of 250,000 vehicles p.a. The Company has been able to reduce
space per vehicle by 30 per cent by innovative rationalisation of
Tool Room & Die Shop
The capability to design and develop tools and dies directly translates
into the Company`s ability to develop new models at a faster pace and lower
cost. The Company was able to enhance this capability and for the first
time exported sheet metal dies to Suzuki for its overseas facilities. With
automation and kaizen in the design and manufacturing process, the Company
has been able to achieve a cost advantage of 25 to 40 per cent over
imported dies.
Energy and Environment Sensitivity in operations
The Company deployed some of the best technologies and global practices
towards water and energy conservation using the principle of Reduce, Reuse
and Recycle. The results over the years have been quite encouraging as the
following graphs show. However, in 2011-12, there was an increase in per
unit consumption of water and electricity owing to lower volumes.
To utilise the energy of the exhaust gases of the Gas Turbine Generators,
Waste Heat Recovery Boilers (WHRBs) and Steam Turbine Generators (STGs)
were installed in the Gurgaon campus. In Manesar, a special Fluidised bed
type incinerator was installed for cleaning of paint booth gratings instead
of a direct burning type incinerator to reduce emissions.
COMPONENT & RAW MATERIAL PROCUREMENT
The challenge of demand volatility was equally applicable to vendor
manufacturing operations as it was to inhouse manufacturing. Parts which
were specific to a diesel or petrol model experienced greater volatility.
The Company`s vendors rose to the occasion and supported it with
flexibility and agility to meet the changing requirements.
The challenge of macroeconomic volatility was felt on the cost side also as
changes in commodity prices and foreign exchange rates were pronounced. The
upward movement of the Yen combined with a downward movement of the Rupee
made the Company`s direct imports and vendors` imports expensive. The
Company launched a major drive to localise imported parts and inner parts
and created a dedicated organisation structure to achieve this objective.
Besides these areas, focus on yield improvement, consolidated buying and
value analysis and value engineering helped offset the impact. The Company
made efforts to develop competency in commodity hedging and some commodity
exposure was also hedged.
During the year, the Company also benefited from lower duty, as India`s
Free Trade Agreements (FTA) with Japan, Korea, Thailand and ASEAN were
notified. Taking the benefits of the FTAs further, locally produced
components were exported to Suzuki subsidiaries in Thailand and Indonesia,
presenting an additional opportunity for suppliers.
For the business to scale up to global levels, Tier 2 vendors need to be
strengthened in terms of robustness of manufacturing and quality systems
and management bandwidth. The Company is devoting resources to their
upgradation as they will form the foundation of sustainable growth of the
Indian car industry.
ENGINEERING AND R&D
The Company`s annual report of 2010-11 was dedicated to the theme of
"Techno-Logical" implying technology excellence and relevance from a
customer`s viewpoint.
Product excellence and relevance have been among the strongest reasons for
the Company`s leadership over the past nearly three decades. The Indian
customer associates the Maruti Suzuki brand with peace of mind, joy of
driving, ease of maintenance, high fuel efficiency and lowest lifecycle
cost of ownership. As mentioned in the Business Performance section, the
Company launched refined versions of the Swift, the DZire and the A-star
models.
The Company showcased Concept XA-Alpha, a compact SUV, expressing its
design philosophy that an adventure lifestyle vehicle with muscular styling
and power can be designed in compact dimensions and low engine
displacement.
During the year, the Alto and Estilo were adjudged the best in the compact
segment and the Swift DZire was ranked highest in the entry midsize segment
of the JD Power APEAL 2011 (Automotive Performance, Execution and Layout)
study. Also, the Estilo and the DZire took the top position in the JD Power
2011 Initial Quality Study (IQS) in the compact and entry sedan segments
respectively. This survey studies customer satisfaction on the product with
respect to ownership during the initial months of vehicle acquisition.
The Company benefits from the parent, Suzuki Motor Corporation`s expertise
in designing models that excel in functionality, fuel efficiency, body
styling and driving pleasure, all this while meeting the customers` cost
aspirations. This has to be further supplemented by local capability in
design, starting with body design. To this end, the Company is expanding
its R&D capacity and has increased its engineers` strength from 250 to
about 1,100 in the past five years. These engineers are being provided
training and exposure to live projects in the areas of planning, styling,
prototyping, vehicle layout, testing and cost management in India and
Japan. The Company is
investing in setting up a local R&D centre in Rohtak, with proving grounds,
crash test facility and wind tunnel testing facility.
With increasing choices to the customer, managing cost has become critical.
The Company is adopting design optimisation, re-engineering, benchmarking,
design to cost and other value enhancement projects as strategies to
control cost.
FINANCIAL PERFORMANCE
As mentioned in the Overview section, the Company was impacted by lower
sales owing to a tough macroeconomic scenario and higher cost owing to
adverse foreign exchange rates and commodity price increases. To increase
sales, the Company expanded its network reach, tried to leverage rural
sales, targeted niche customer segments and made efforts to enhance diesel
engine supplies. On profit margins, the Company made strong efforts to
reduce cost and localise and was also forced to pass on some price increase
to the customer. While the Net Profit declined as is shown in the following
abridged profit and loss statement, the Company has taken some strong and
concrete measures to enhance revenues and profits:
* Diesel engine availability is expected to improve to about 400,000 units
in the year 2012-13 from about 250,000 units in 2011-12. Realising the
potential demand for diesel vehicles, a further capacity expansion is
planned in phases.
* The Company has entered the utility vehicles segment with the Ertiga,
where it had a miniscule presence till now, and plans to strengthen this
position with more products.
* As mentioned in the Raw Material and Component Procurement section, the
Company is making focused efforts on localising import content and has
created a dedicated organisation structure for this.
* The Company has received permission from the Reserve Bank of India to
take hedges on foreign exchange exposure due to its vendors` inner part
imports. This will facilitate centralised and fast decisions on foreign
currency hedges for the entire value chain.
* The Company has also constituted joint teams of Finance and Supply Chain
functions to explore possibilities of hedging its commodity exposure in
copper, aluminium and precious metals.
Table 1: Abridged profit and loss account for 2011-12:
(Rs. million)
Parameters 2011-12 2010-11 Change
1 Volumes (Nos)
Domestic 1,006,316 1,132,739
Export 127,379 138,266
TOTAL 1,133,695 1,271,005 -10.8%
2 Goss Sale of Products 386,141 401,021
Vehicles 362,111 380,607
Spare parts/dies &moulds/components 24,030 20,414
3 Excise duty 39,082 42,531
4 Net sales (2-3) 347,059 358,490
5 Other operating revenue 8,812 7,694
6 Other income 8,268 5,088
7 Total revenue (4+5+6) 364,139 371,272 -1.9%
8 Consumption of raw materials,
components & traded goods 280,656 283,382
9 Employee benefit expenses 8,438 7,036
10 Finance Costs 552 250
11 Depreciation and amortisation 11,384 10,135
12 Other expenses 41,647 39,381
13 Total expenses 342,677 340,184 0.7%
14 Profit before tax (7-13) 21,462 31,088 -31.0%
15 Current tax 4,138 8,101
16 Deferred tax 972 101
17 Profit after tax (14-15-16) 16,352 22,886 -28.6%
Table 2: Financial Performance - Ratios (As a Percentage of Net Sales)
Parameters 2011-12 2010-11 Change
Material cost 80.9% 79.0% (1.9)
Employee benefit expenses 2.4% 2.0% (0.4)
Depreciation and amortisation 3.3% 2.8% (0.5)
Other expenses 12.0% 11.0% (1.0)
Profit before tax 6.2% 8.7% (2.5)
Profit after tax 4.7% 6.4% (1.7)
Treasury operations:
The Company has efficiently managed its surplus funds through careful
treasury operations. The guiding principle of the Company`s treasury
investments is safety and prudence. In view of this, the Company invested
its surplus funds in debt schemes of mutual funds and short-term bank fixed
deposits. This has enabled the Company to earn reasonable and stable
returns in a volatile interest rate scenario.
Table 3 lists the different portfolios while Table 4 lists the return on
these surplus funds.
Parameters 31-03-12 % of total 31-03-11 % of total
Corporate Bonds - - 7,000 10%
Bank Fixed Deposits 23,600 30% 24,130 34%
Debt Mutual Fund 56,106 70% 40,106 56%
TOTAL 79,706 100% 71,236 100%
Table 4: Income from investment of surplus fund (Rs. million)
Parameters 2011-12 2010-11
Dividend from debt mutual funds 639 2,066
Net Profit from sale of investments 2,442 571
Internal controls and adequacy:
The Company has a proper and adequate system of internal control to ensure
that all assets are safeguarded and protected against loss from
unauthorised use or disposition, and that all transactions are authorised,
recorded and reported correctly. The internal control system is designed to
ensure that financial and other records are reliable for preparing
financial information and other data, and for maintaining accountability of
assets. The internal control system is supplemented by an extensive program
of internal audits, reviews by management, and documented policies,
guidelines and procedures.
HUMAN RESOURCES
The Company has always striven to offer a positive, supportive, open and
high performance work culture. Over the years its unique work culture has
evolved with learning from Suzuki, Japan in terms of Japanese systems,
processes and work practices and also from the experience of local context
and expectations of its people.
Some of the key constituents of the work culture are fairness, equal
opportunity, participation and involvement and team work.
The induction of a young workforce over the last five years and enabling
their smooth settling down in the Company work culture has been a
challenge. The emphasis has been on increased two way communication, stay
interviews, creating job excitement, education and learning towards career
development.
The experience of handling the Manesar Plant labour issue during the last
year further highlights the need for the management focus on effective
induction, total involvement, training and mentoring of the young team
members at the shop floor level. The new initiatives in this direction over
the last six months have given positive results. One of them is the
outbound training initiative where a diverse population of associates,
supervisors, young managers and middle management team members are taken to
mountains or areas of natural challenges and imparted learning through
the experience of group exercises. Till now 14 such programmes have been
conducted covering more than 300 employees. This initiative is planned to
cover more shop floor employees of the Company. With strong growth and
expansion of the business and more and more young new team members likely
to join its team, the Company plans to lay the highest emphasis on
reinforcing a positive work culture, internal communications and continuous
training and mentoring.
Retention of talent is a challenge as most automobile and engineering
companies seek to recruit experienced professionals to augment their teams.
In spite of an adverse external environment related to headhunting and easy
poaching, the Company has been able to maintain an attrition loss of only
5.9 per cent in the year 2011-12 much below the manufacturing industry
trends. While this is largely the result of a culture of fairness,
transparency, team spirit and motivation, some concrete initiatives like an
elaborate performance management system, an appraisal process to assess
potential, job rotation, encouragement for higher education and a policy of
career growth offering fast track, normal track and extended track
opportunities have provided the right structure.
INFORMATION TECHNOLOGY
Technology systems at the Company provide seamless integration and real-
time connection with the business partners. The e-Nagare system, based on
just-in-time philosophy, generates hourly schedules and keeps vendors
updated on component requirements and shipments. The Dealer Management
System (DMS), a 3600 system for managing dealer operations, along with
other key features tracks enquiries and monitors retail sales on a real
time basis keeping the sales team abreast with the latest market situation.
Business intelligence tools with advanced analytics empower the Company to
maintain a database of 8 million customers. This helps in closely
understanding and profiling customers to gain actionable insights and
target potential buyers. In FY2011-12, the Company successfully integrated
Maruti R&D systems with Suzuki for a unified approach to product
development. Implementation of predictive modeling in parts business helped
in improving forecasting ability.
The Company is now working on a training academy project that will enable
employees to learn at their own pace. The training academy in an e-learning
mode seeks to equip vendor and dealer employees with critical skills and
knowledge and give scalability to the training function.
RISK FACTORS
The Company operates in an environment which is affected by various factors
some of which are controllable while some are outside the control of the
Company. The activity of risk management in the Company is reviewed by the
Audit Committee through a management subcommittee, the Executive Risk
Management Committee (ERMC). The ERMC consists of the Managing Director &
CEO and all executive officers of the Company. It reviews the risk
management activities on a regular basis in addition to scanning for any
new risks that may arise due to changes in the business environment. While
the possibility of a negative impact due to one or more such risks cannot
be totally precluded the Company proactively takes reasonable steps and
makes efforts to mitigate significant risks that may affect it. Some of the
risks that are potentially significant in nature and need careful
monitoring are listed hereunder:
* Macroeconomic factors
* Preparedness of value chain partners
* Inappropriate product portfolio
* Competition product launches
* Talent acquisition and retention
* Geographic concentration
* Changes in government policy and legislation
* Unfavourable changes in the import policies on new cars
* Unfavourable changes in taxes/levies
OUTLOOK
Though the Indian passenger vehicle industry has reasons and prospects to
grow at a good pace for a long time, the journey will not be smooth, as was
seen in the year 2011-12. There were challenges in terms of adverse
macroeconomics, demand slowdown, petrol-diesel price distortion, adverse
foreign exchange rates and turbulence in industrial relations. The market
share and profitability of the Company were adversely impacted. While the
growth prospects in India are fundamentally positive, challenges like these
and the impact of business cycles cannot be ruled out. Competitive
intensity will also increase in the future. The differentiating factor is
the management`s commitment not to accept adversity, to learn from every
opportunity and emerge stronger, to look for areas in its sphere of
influence rather than surrendering to external adversity, to keep investing
and strengthening for the long term, promote the well being of its
stakeholders and stay focused on the needs of its customers. The Company
has some good enablers in the areas of management talent and commitment,
relevant technology, a proximate and caring network, sensitivity to new
customer lifestyles and potential segments, a culture of efficiency and
cost consciousness, promotion of superior management practices in its
vendors and dealers and scalability in all these areas. Unfazed by the
past, but avoiding complacence at all times, the Company will keep working
hard to strengthen its market leadership and profitability and its ability
to continue serving society.
Disclaimer
Statements in this management discussion and analysis describing the
Company`s objectives, projections, estimates and expectations are
categorised as `forward looking statements` within the meaning of
applicable laws and regulations.
Actual results may differ substantially or materially from those expressed
or implied. Important developments that could affect the Company`s
operations include an onward trend in the domestic auto industry,
competition, rise in input costs, exchange rate fluctuations, and
significant changes in the political and economic environment in India,
environmental standards, tax laws, litigation and labour relations. |