bosch ar 2001 rgb - Bosch India

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Contents

4

About Bosch Group

5

About Bosch Limited

6

Board of Directors, Committees, etc.

8

People at Bosch - Key for Success

17

Report of the Directors

34

Financials at a glance

36

Annexure to the Report of the Directors

39

Report and Certificate on Corporate Governance

51

Management Discussion and Analysis Report

57

Report on Corporate Social Responsibility

63

Report of the Auditors to the Members

66

Balance Sheet

67

Profit and Loss Account

68

Cash Flow Statement

69

Schedules to Balance Sheet

77

Schedules to Profit and Loss Account

79

Notes on Accounts

96

Balance Sheet Abstract

97

Subsidiary Company

Cover Page A trainee at the prestigious Bosch Vocational Centre, Bangalore. Decades ago, when Bosch set its foot on the shores of India, a shortage of technical talent was identified. To counter this shortage, Bosch Limited opened a vocational centre to train young apprentices who have passed matriculation. By catering to this shortage, Bosch Limited has managed to succeed where other companies feared to tread. The vocational center at Bosch is a full-fledged training centre that aims to develop a reservoir of skilled personnel required to produce quality products on sophisticated machines. By focusing and building more on the theme of gender diversity, Bosch is proposing to expand its talent pool and help build a better balanced work place. Bosch Limited is looking towards hiring women who can bring in their unique style of soft management skill sets which would be beneficial and invaluable to a manufacturing setup.

105 Shareholder Information 109 National Network 111 Attendance Slip and Proxy

4 | About Bosch Group | Annual Report 2011

About Bosch Group

Bosch Headquarters in Stuttgart, Germany.

The Bosch Group is a leading global supplier of

Precision Mechanics and Electrical Engineering.”

technology and services. According to preliminary

The special ownership structure of Robert Bosch

figures, more than 300,000 associates generated

GmbH guarantees the entrepreneurial freedom of

sales of 51.4 billion Euros in the areas of automotive

the Bosch Group, making it possible for the

and industrial technology, consumer goods, and

company to plan over the long term and to

building technology in fiscal 2011. The Bosch

undertake significant up-front investments in the

Group comprises Robert Bosch GmbH and its more

safeguarding of its future. Ninety-two percent of the

than 350 subsidiaries and regional companies in

share capital of Robert Bosch GmbH is held by

some 60 countries. If its sales and service partners

Robert Bosch Stiftung GmbH, a charitable

are included, then Bosch is represented in roughly

foundation. The majority of voting rights are held

150 countries. This worldwide development,

by Robert Bosch Industrietreuhand KG, an

manufacturing, and sales network is the foundation

industrial trust. The entrepreneurial ownership

for further growth. Bosch spent more than 4 billion

functions are carried out by the trust. The

euros for research and development in 2011, and

remaining shares are held by the Bosch family and

applied for over 4,100 patents worldwide. With all

by Robert Bosch GmbH.

its products and services, Bosch enhances the quality of life by providing solutions which are both innovative and beneficial.

The Bosch slogan 'Invented for Life' is part of its long tradition, through which it communicates the Group's core competencies and vision, that include

The company was set up in Stuttgart in 1886 by

technological leadership, modernity, dynamics,

Robert Bosch (1861-1942) as “Workshop for

quality and customer orientation.

Annual Report 2011 | About Bosch Limited | 5

About Bosch Limited

Bosch Limited Corporate Office in Bangalore, India.

Bosch has been present in India for more than 80

packaging machines, electric power tools and

years - first through a representative office in Calcutta

security systems. In 2011 Bosch Limited touched a

since 1922, and from 1951 through its subsidiary

turnover of Rs. 7929.5 crores.

Bosch Limited.

Apart from a wide product portfolio, over the decades

Today the Bosch Group in India has grown to include

the company has also developed excellent R&D

6 group companies of which Bosch Limited is the

facilities in the country resulting in a strong and loyal

flagship business entity. Robert Bosch GmbH holds

customer base. The market leadership of Bosch

71.18% stake in Bosch Limited. Headquartered out of

Limited is a testimony to the high quality and

Bangalore, Bosch Limited has its manufacturing

technology of its products. Over and above a strong

facilities in Bangalore, Nashik, Naganathapua, Jaipur

presence in the India Automotive services sector,

and Goa. These Plants are TS 16949 and ISO 14004

Bosch in India has a vast service network that spans

certified. With a presence across automotive

across 1,000 towns and cities with around 2500

technology, industrial technology and consumer

service outlets. These service outlets ensure

goods and building technology the company has a

widespread availability of both products and

headcount of over 12,200 associates. It manufactures

services. In addition to this, Bosch in India also has a

and trades products as diverse as diesel and gasoline

strong automotive training network that is spread

fuel injection systems, automotive aftermarket

across 15 cities thereby offering parts, bytes, services

products, auto electricals, special purpose machines,

and training all under one roof.

6 | Board of Directors, Committees etc. | Annual Report 2011

Board of Directors, Committees, etc.

Dr. A. Hieronimus Chairman

B. Steinruecke Director

Dr. B. Bohr Director

B. Muthuraman Director

Renu S. Karnad Director

Prasad Chandran Director

V.K. Viswanathan Managing Director

Dr. Manfred Duernholz Joint Managing Director

Soumitra Bhattacharya Alternate Director for Dr. B. Bohr

Annual Report 2011 | Board of Directors, Committees etc. | 7

Company Secretary A. Vijay Shankar Auditors Price waterhouse & Co. Bankers State Bank of India Canara Bank Citibank, N.A. Deutsche Bank AG Registered Office Hosur Road Adugodi Bangalore - 560 030 Stock Exchanges (Where the shares of the Company are listed) Bombay Stock Exchange Limited Phiroze Jeejeebhoy Towers Dalal Street Mumbai - 400 001 National Stock Exchange of India Limited Exchange Plaza, Bandra-Kurla Complex Bandra (E) Mumbai - 400 051 Registrar & Transfer Agent Integrated Enterprises (India) Limited No. 30, Ramana Residency 4th Cross, Sampige Road Malleswaram Bangalore - 560 003

Audit Committee Renu S. Karnad, Chairperson Dr. A. Hieronimus B. Steinruecke B. Muthuraman Prasad Chandran Shareholders'/Investors' Grievance Committee B. Steinruecke, Chairman Renu S. Karnad Prasad Chandran Dr. A. Hieronimus V. K. Viswanathan Remuneration Committee Dr. A. Hieronimus B. Muthuraman B. Steinruecke Prasad Chandran Investment Committee B. Muthuraman Renu S. Karnad V. K. Viswanathan Dr. Manfred Duernholz Soumitra Bhattacharya Property Committee Dr. A. Hieronimus Renu S. Karnad V. K. Viswanathan Dr. Manfred Duernholz Share Transfer Committee B. Muthuraman B. Steinruecke Prasad Chandran V. K. Viswanathan

8 | People at Bosch - Key for Success | Annual Report 2011

People at Bosch - Key for Success “A company, which, like mine, strives for perfection must in its own interests, make great efforts to train its people. In certain respects, anyone who wants to produce good work as a company must - whether they want to or not - also perform the role of educator in the positive sense of the word, and hence for the good of the economy as a whole,” says Robert Bosch in his memoir. Gone are the days when employees would spend their entire professional life in a single company. Today, a high attrition rate is one of the most common and challenging of problems that organizations face. Bosch however, isn’t part of this trend and can proudly boast of associates who have been with the company their entire working life. Despite the immensely positive image that Bosch enjoys as an employer; Bosch does acknowledge that change is the only constant. Bosch associates have also changed, bringing with them a new set of expectations. Acknowledging this need to match changing expectations, Bosch is constantly working towards fulfilling human resources and industry requirements. Employees today require much more than a regular eight to nine hour job. They seek opportunities that provide them with a rich, exciting, rewarding experience, a definite career path along with sustainability and security. One of the most conspicuous steps Bosch has taken with respect to providing its associates with these prospects is the enhancement of its associates’ knowledge base and skill development. For this very purpose, the Company is making considerable investments in the training and upgrading of associates’ skills and in state-ofthe-art engineering infrastructure. Bosch in India has been able to live up to the global image of being one on the most admired employers. In Fortune magazine’s first survey on India’s most admired companies held this year, Bosch was ranked number 11. In talent management and leadership in the entire auto industry, Bosch in India was ranked number 1. It was ranked number 2 in Innovation. These rankings are a testimony to the opportunities and the experience that Bosch in India guarantees its associates. Given the wide portfolio of Bosch Limited, (also referred to as the Company henceforth), the opportunities that associates receive in the areas of innovation, management, and skill development are quite inspiring. The emphasis that the Company lays on training and development reflects highly on its profits. In 2011, Bosch Limited recorded a 19.6% growth in sales revenue over 2010. As a market, India has its own unique needs that are different from the requirements of traditional Bosch markets. This further opens doors for opportunities, not just in contemporary technologies such as common rail, starters & generators and gasoline systems, but also in other industries such as the industrial and consumer goods industry. To meet the needs of this ever demanding market, Bosch Limited has decided to develop local competencies for better understanding. For this very purpose, the Company is making considerable investments in the training and upgrading of associates’ skills and in state-of-the-art engineering infrastructure.

Bosch Values “Our values serve as a benchmark by which we can measure our activities. Future and result focus have been placed on top of our value system on purpose. But the others Responsibility, Fairness, Compliance and Diversity are equally important. These values show us the way to achieve our central objective of securing the future success of Bosch,” says Franz Fehrenbach, Chairman, Board of Management.

During their visit to India, the GFS was present at a Voluntary Lernstatt Team session. The Voluntary Lernstatt Team (VLT) is a project where a group of people working in a department and doing similar work meet willingly and frequently after work hours to recognize work related problems, prioritize them and find workable solutions to resolving them.

People at Bosch - Key for Success | Annual Report 2011 | 9

Values at Bosch define the common thread running between geographically and culturally diverse offices and divisions. Many of the Bosch values can be traced back to its founder Robert Bosch. These values reflect the manner in which Bosch runs its business and its professional ethics in dealing with business partners, investors, employees and society. These seven values are what bring the teams together and lend a base on which management decisions are made.

Future and result focus Associates are critical to the success of an organization – they are its most valuable asset - and, it is pertinent that their progress be at the core of the Bosch Limited’s developmental plans. Bosch Limited realizes that there is tremendous potential out in the market and to capture it, several programs have been initiated to attract young talent. By investing today in young talent, the Company is securing its future, thus being future- oriented and result focused. The popular Junior Managers Program, the Technical Managers Training program and the Indo-German Training program are all part of this same focus. For identification, selection and grooming of high potential talent there are specific programs like the junior to middle associate development program and the middle to senior management evaluation and development seminar. Last year, out of the 315 associates identified as high potential, 286 underwent rigorous assessment procedures.

Junior Managers Program The Junior Managers Program (JMP) is the most-prestigious program run by Bosch for mid-level managers. It is aimed at nurturing MBAs from the Top 20 B-Schools who are likely to be tomorrow’s Bosch executives for accelerated international careers. Challenging projects, responsibilities, a global network as well as intensive onand off- the job training help the associates prepare for senior management responsibilities early in their career. This 24-month rotational program, modeled after a training program in Germany, has produced many top executives over the past 30 years, including the Chairman of the Board, Franz Fehrenbach. In all, 54 associates have been selected for the JMP program since 2008. “The JMP is an excellent program for those people who have a strong learning orientation and like new challenges, Bosch being the huge MNC that it is, never fails to keep raising the bar for employees who want to keep growing and learning, Moreover, my mentor allowed me to experiment and finally choose an area of my liking and interest.” Feedback by Gandhali Mahajan,, Plant HRL who recently completed the JMP.

Technical Managers Training The Technical Managers Training program is especially targeted at associates hired from top-ranking engineering colleges. It aims to strike the right balance of theoretical and practical subject matter ensuring optimum 'real-

Bosch has always sought to provide its associates the opportunity to increase and enhance their knowledge base. One such opportunity is the Executive General Management Program in India. To facilitate the roll out of this program in India, Robert Bosch Kolleg (RK)-Germany which functions as a corporate university at Germany has collaborated with the Indian Institute of Management-Bangalore (IIM-B) for an eight-week residential program.

10 | People at Bosch - Key for Success | Annual Report 2011

world' application for various workshop needs. At Bosch, it is believed that a technician who has the ability to diagnose problems quickly and accurately increases the efficiency of the workshop, gives greater customer satisfaction and in turn results in greater profit. Fitting the right person to the right job is the key to success here. The Indo-German Chamber of Commerce, through its training center, conducts training programs covering different aspects of management – marketing, finance, human resources, operations, quality and productivity improvement, personality and soft skill development among others. This program enables employees to remain competitive apart from conducting and awarding degrees in management. Bosch has been associated with this program for nearly 22 years. In the last five years Bosch has absorbed 30 students from this initiative in Mumbai, Bangalore and Kolkata. Growth opportunities and the constant learning that such initiatives have to offer have helped Bosch Limited build a reputation for talent management, helping it attract the best candidates on campus apart from retaining and nurturing them. This culture prompts associates to deliver beyond expectations, by working and contributing to the best of their ability.

Bosch Vocational Centre By bridging the gap in the technical talent space, Bosch Limited has managed to succeed where others fail. The need for skilled manpower has given rise to the need for vocational training. To cater to this need, Bosch Limited has a full-fledged training centre to bridge this gap and develop a reservoir of skilled personnel required to produce quality products on sophisticated machines. Apprentices straight out of matriculation are recruited and trained at this state-of- the-art vocational centre famously referred to as the Bosch Vocational Centre. While the first year at the centre focuses on familiarizing the student to the course, the second year focuses on joboriented training and industrial exposure. At the end of the second year, students are trained in different areas of specialization and in-plant training for acquiring advanced skills. Heavy emphasis is laid on "multi-skilling" with emphasis on accuracy and high quality - this is the first step towards creating a future "Technocrat.” On an average Bosch in India hires around 150 graduate apprentices a year. These apprentices are given ample amount of training along with a stipend. At the end of the course they are mostly absorbed on the payrolls of the company. By hiring them young, Bosch is able to mould them and infuse in them the Bosch culture as well as the habit of delivering and maintaining high quality standards. At its training centres in Bangalore, Nashik, Naganathpura and Jaipur, Bosch provides hands on training experience. These apprentices are guided by industry experts in the latest curriculum as per industry needs. Young engineering graduates receive exposure to training programs that are in line with the requirements of the industry. At these facilities, training is also provided to existing associates and business partners on the latest in technology and Bosch standards of production. Leadership, technology, methods, process management and business administration are just some of the competency areas covered by the various training programs conducted at Bosch Limited. These training sessions are derived and developed from corporate competence standards and are termed as Global Corporate standard trainings and are applicable to Bosch associates worldwide. Every year, Bosch Limited aims to train 25

The Junior Managers Program (JMP) is among the several programmes started by Bosch Limited; this programme offers Bosch executives the ideal opportunity to accelerate their career which includes challenging tasks and a lot of responsibilities among others.

People at Bosch - Key for Success | Annual Report 2011 | 11

associates under this project. A mandatory day-long training program for blue collared associates, titled “Working According to Standards,” trains around eight associates in production and related support areas. The program focuses on prioritizing to resolve production issues, understanding process confirmation and line balancing among others.

Responsibility In recent times, Corporate Responsibility has emerged as a significant topic in the international industrial community and is slowly but surely on its way to becoming a mainstream activity. Bosch Limited has always believed that the Company’s actions must be in accord with the interests of the society. Above all else, Bosch Limited places its products and services in the interests of the safety of people, the economic use of resources and in the sustainability of environment. Bosch offers excellent opportunities to shape careers and make a difference. The Company also has various programs for knowledge sharing and enhancement customized for individual associates and teams across levels. To keep associates’ views in line with the views of the Company, programs for middle level and senior level management have received a definite boost. In times as challenging as these, when business dynamics are changing radically, the pressure on the management increases significantly. To help managers of Bosch Limited cope better with these, the Bosch Training Center has rolled out the flagship Executive General Management Program in India. This is the first global rollout of the program outside Germany. To facilitate the roll out of this program in India, Robert Bosch Kolleg (RK)-Germany which functions as a corporate university at Germany, has collaborated with the Indian Institute of Management-Bangalore (IIM-B) for an eight-week residential program. In addition to the seminars, colloquium lectures and forums, RK also runs full-time management programs. The program consists of five modules, which blend management concepts with actual life learnings in the form of actual processes, methods and practices followed at Bosch. Executives gain better management insights, which helps them deliver results efficiently. The program intends to provide executives with the necessary exposure to current trends in management thinking, support them in better handling of professional demands in a globalised, matrix environment and also help increase networking among managers across all Bosch entities in India. This general management program, aimed at middle and senior associates, provides an overview on management topics such as entrepreneurial mindset, strategy, marketing, brand management, finance, accounts, supply chain, human resources, business excellence and corporate governance. In all, around 50 associates have benefited from this program since its commencement in India. Taking the value of responsibility ahead, reputed executive coaches were hired to guide and mentor the senior leadership of the Company in order to help them cope with personal and business dilemmas. In an initiative titled “Leading in India,” by Dr. Muengersdroff, an expert in cultural and organizational development as well as complex change management projects from the Carnegie Bosch Institute - Tepper School of Business, 16 seniors leaders brainstormed and discussed the need for and ways to usher in a uniform leadership culture.

The ratio of the number of women in India in the manufacturing sector is barely significant. Recognizing this disparity, Bosch Limited has sought to do something about it. The Company in an attempt to address this disproportion has already incorporated multiple cultures and is now focusing on increasing the awareness on gender diversity within the organization.

12 | People at Bosch - Key for Success | Annual Report 2011

The workshop identified some of the desirable leadership cultural traits that will be institutionalized in Bosch in the coming years. The global Bosch leader, as identified, was one who has traits such as entrepreneurial skills, determination, capability to deal with ambiguity and the ability to deliver as promised. The team agreed to work on a culture that fostered growth, was open, and sought strength in cooperation. Senior leaders at Bosch Limited have seen the need to have a strong ‘leadership culture’ to bring uniformity in approach and treatment across all offices and divisions across locations. Top management needed to address the changing expectations from the current generation. Initial informal discussions brought out the need to focus on areas such as leadership styles and role model behaviors, apart from connectivity amongst different generations of leadership fostering a sense of ‘oneness’ among all. The first tangible output regarding these elements of leadership, was to adopt a consensus approach aptly titled ‘My Task – My Goal – My Way.’ A Process Consultancy Training program was also conducted for 35 people from the leadership team. These sessions discussed traditional leadership styles, openness in feedback, the need for dialogues and mentorship.

Initiative and determination Bosch Limited has always acted on its own initiative, with an entrepreneurial but accountable spirit and demonstrates determination in pursuing its goals. Bosch Limited believes in employee engagement to resolve issues. The Bosch philosophy is to strive continuously for improvement and make things better. The Voluntary Lernstatt Team (VLT) is an interesting initiative where a group of people working in one department and doing similar work meet voluntarily and regularly after work hours to identify work related problems, prioritize them and locate workable solutions to resolve them. This approach helps not just achieve business and operational goals, but leads to low-cost improvement solutions, teamwork and development of associates, as certified trainers in structured problem-solving often train the VLT group formally. The solutions arrived at by the group are shared not just with business heads but displayed to visitors and others. Competitions are held regularly leading to further employee enthusiasm and motivation.

Openness and trust At Bosch Limited, it is a must to have all stakeholders - that is from our employees, to our business partners and investors among others- informed in a timely and open fashion of the important developments that take place within the company. To foster this kind of an atmosphere of work, Bosch Limited has initiated several programs to help build the factor of trust and openness among associates. These programs include huge sums of money being donated to research institutes towards the nurturing of young ones and also taking care of the interest of retired associates. In 2011, to commemorate 125 years of its existence, the Bosch Group rededicated itself to the values of education and continued learning upon which the company was founded. It launched a global initiative called the ‘Bosch InterCampus Program’ by announcing a total investment of 50 million euros (INR 300 crore) for universities and research projects in Germany, China, India and the US over the next 10 years. The initiative aims to achieve lasting improvements in research conditions for undergraduates

At Bosch Limited the need to take the value and initiative of responsibility ahead was seen as imperative. For this purpose, reputed executive coaches were hired to guide and mentor the senior leadership of the Company. This initiative was aptly named “Leading in India,” during the course of this programme the leadership brainstormed and discussed the need for and ways to usher in a uniform leadership culture.

People at Bosch - Key for Success | Annual Report 2011 | 13

and scientists in universities thereby accelerating progress in the highly promising fields of the environment, energy, and mobility. “By funding science and research, we’re investing not only in the future viability of our company but also in the future of a global society,” says Franz Fehrenbach, chairman of the Bosch board of management. A giant share of the fund - some 22.8 million euros (INR 140 crore) – is aimed at funding the independent “Robert Bosch IISc Center for Research in Cyber Physical Systems” at the Indian Institute of Science in Bangalore in India. The research will aim at development of cyber-physical systems that will help save energy in India, and will be a future hub or campus for IT design, cyber-physical systems, mobility solutions and renewable energy in collaboration with the country’s leading scientific institute, the Indian Institute of Science. On November 8, 2011, the former President of India, Dr. A.P.J Abdul Kalam, launched the Robert Bosch IISc Center for Research in Cyber Physical Systems amidst great media fervor. “The future of our industry, and any progress in the technical field, depends on the training of capable mechanics and technicians.” – Robert Bosch in his memoir. Following in the footsteps of its Founder, Bosch Limited believes that a well-trained associate is an asset to business. The intangible asset that a trained and knowledge rich workforce provides is truly invaluable for an organization that is built on the benefits of innovation and quality. Associate development is at the core of the Company’s management philosophy. Last year, Bosch reiterated its emphasis on continuous competence development for all associates. Programs were designed wherein associates’ potential were identified for career planning and advancement opportunities as well as competency based training and development. On an average, every associate attended at least two training programs a year. “To continue to be innovative and successful in the future, we need associates with excellent training who are committed and content. That’s why we offer our workforce a professional and innovative working environment and attractive development opportunities,” says Dr. Wolfgang Malchow, the director of industrial relations at Bosch. Globally, every year, Bosch invests some 200 million Euros in enhancing its associates’ qualifications and skills.

Bosch Management Services An organization that focuses on nurturing talent also runs the risk of losing it. Every time associates retire, the company loses valuable expertise. Bosch wants to utilize the experience of retired executives and offer them the option of a “second career.” Bosch Management Services makes use of the skills of retired associates aged between 60 and 75. These resources are paid a consultancy fee, which is lower than what is paid to external consultants. This gives the company the benefits of getting access to a ready and trained talent pool at short notice. The knowledge bank that this initiative gives Bosch access to is phenomenal since each of the consultants have three to four decades of work experience at Bosch and know the company thoroughly. This helps smoothen workload

Ankur: ” I work in FeP/TEF-6, the department is responsible for Industrial Engineering. To work in the company’s global head quarters as a VA is like a dream come true. The learnings I have had from this programme are immense; especially with respect to Robust Systems& Processes, Planning and Time sensitivity. What makes FeP even stronger is the expert/domain knowledge, problems are solved considerably faster by focusing on the root cause of the problem. The focus is always on the issue and not the person. The work is quite detailed and provides deep insight into Industrial Engineering, be it standardized work, work place arrangement or ergonomics. I have been handling these subjects independently and also with local teams, overall quite the experience has been enriching and satisfactory.”

14 | People at Bosch - Key for Success | Annual Report 2011

management and allows ex-employees to cope better with aging and retirement.

Fairness At Bosch Limited, mutual fairness has always been the platform on which the Company has achieved success, be it from dealing with one another in the Company or our business partners.

Gender Diversity Focus Traditionally, women have been under-represented in organizations across India and continue to face many barriers on their way to the top. While most management realizes the benefits of gender diversity and is committed to the mandate of gender inclusion, that commitment often does not translate into action. Bosch Limited has recognized this disparity and has sought to do something about it. The Group, which has already integrated multiple cultures, is now focusing on enhancing gender diversity within the organization. Currently, women account for a small percentage of the Bosch associate base and have a minimum representation on the Board of Directors. The Company aims to increase this proportion in the coming years. By building more on the theme of gender diversity, Bosch intends to hire women who bring in their unique style of soft management skill sets which can be invaluable in a manufacturing setup. By reflecting better on the world outside the factory gates, Bosch aims to build a more responsive and positive organization that recognizes and rewards hard work and thus create a more balanced workplace. Bosch also recognizes that communication is vital in the implementation of diversity at the work place. Since it is imperative that actions reflect the intent of the organization, Bosch has taken significant steps towards building a workplace where diversity thrives. With executive coaches to guide and advise women specialists and executives and in-house collaboration with other reputable companies (cross-company mentoring) Bosch Limited hopes to improve the count of women in the company. In 2011, two workshops on gender diversity were organized for business women in India. A diversity workshop to enable HR associates of Bosch India enhance their capabilities in this aspect was also organized. The Business Women’s training program is designed to help women specialists and executives get ahead, with skills such as better negotiation strategies or career planning. The “Gender Talk,” seminar that was open to both women as well as men, dealt with sensitive issues regarding gender-specific topics such as the different ways of doing business, behavior within teams and life plans. Bosch recognizes that relationships and good networks are important in building careers. Since 1995, female Bosch associates have been using the company’s women’s network, which is now called [email protected], where they can exchange knowledge, provide mutual support across divisions and levels and gain a voice to promote their interests. In 2011, Bosch launched the Gender Diversity Global Communication Initiative targeting the desired mindset change. The campaign focuses on creating mixed teams that demonstrate the benefits of a healthy gender mix in taking more balanced decisions. Special recruitment drives for women were also conducted. A 12-month management development program for mentoring women associates was launched formally.

As a first step, the Gender Diversity Project focuses on cooperation between men and women, and on the formation of mixed teams across all levels of the organization It’s not about men versus women – it’s about diversity in mixed teams as a key to long-term success.

People at Bosch - Key for Success | Annual Report 2011 | 15

Reliability, credibility, and legality The management at Bosch has always sought to be a reliable and credible entity, which has always abided by the laws of the land they are operational in. The Company’s management encourages associates to imbibe these values and to live by them. It sets very high standards when it comes to the issue of compliance and shows absolutely no lenience if anyone was to go against the established guidelines. With guidelines as strict as these, associates at Bosch feels more secure and looked after. It is due to such guidelines and associate programs that the rate of attrition at Bosch Limited stands at 11%. The opportunity to work in a truly global environment and be exposed to diverse cultures, coupled with knowledge and skill training development are just some of the key reasons behind employee satisfaction and retention in the company. Associates indicated a strong sense of identification with the company. While around 84% of the workforce is proud to work for Bosch, 82%of associates would also recommend Bosch as an employer. Both of these figures have improved tremendously since the last survey.

Cultural diversity The rich diversity that the Group’s associates offer, in terms of their accepted wisdom, aptitude and capability is what makes Bosch the respected company that it is today. Cultural Diversity has now come to be the key to an organization’s success and glory. Bosch realizes that to make the best of this value several steps must be taken. Given the tremendous and incredible reach of Bosch across the globe, an awareness of the Group’s regional and cultural origins must be created; simultaneously the associates must learn to value this diversity as an asset which is also a precondition to global success. Bosch employs over 300,000 people across the world of which 22,500 or 7.5% are based in India. Respect has always been the driving force at Bosch, this respect is extended to employees across al levels and divisions. Keeping in line with this very important strategic view, Bosch globally refers to its employees as associates. While shop floor staff is referred to as blue collar associates, those in supervisory and support functions are referred to as white collar associates. The Bosch talent pool is hand picked from the best educational institutions. As part of the Bosch team the young minds are offered continuous training, along with opportunities for international exposure. Prospects such as these ensure that associates of Bosch have a cross-cultural perspective and strong domain know how. As teams have to work across geographies and cultures, training programs cover various domains, technologies, soft skills and business skills. This involves workshops, simulation scenarios, and language courses. This is in addition to country specific cultural orientation that often involves client teams as well. Bosch also provides an excellent opportunity for associates to carve out truly international careers. With around 350 subsidiaries and regional companies, Bosch offers development possibilities and a variety of opportunities to gain international experience the world over – from short-term tasks for specific projects to assignments extending over several years. Bosch also encourages its associates to move between different industries, divisions, and business sectors. Development opportunities in the workplace, work-life balance and integrated health management are also important, as is a values-driven management culture.

We are aware of our company's regional and cultural origins and at the same time regard diversity as an asset, as well as a precondition of our global success. People from over 111 nations, with different ethnic origins and individual lifestyles, including men and women of different generations, all work together for Bosch. This diversity is something that helps our company grow and develop.

16 | People at Bosch - Key for Success | Annual Report 2011

The popular Vertragsangestellte (VA) initiative allows employees to work in different geographies for over one to five years increasing their understanding and cultural orientation. Emmanuel Grange who was at the DS Bosch plant of VxP1 (Vénissieux), got an opportunity to work in India in 2008 and underwent a cultural-orientation program, which he highly recommends for all VAs. Elaborating on his India experience Emanuel says, “I wanted to work in an international company. In India, I have the chance to work in a department which is growing and for which huge investments are required. The work content is very challenging. Parallely, I am developing my leadership skills as I am group leader for a team of four people. The culture environment is completely different, and I am learning to work with more unplanned situations. I have to think in a different way and to adapt my behavior to the local habits in order to get the work done. This experience is helping me in improving my adaptability to various situations, getting more focus on priority and being more assertive.”

Industry cheers Bosch Bosch Limited bagged the prestigious Significant Achievement award for HR-Excellence Assessment conducted by Confederation of Indian Industry (CII). In addition, associates of Bosch Limited bagged the top awards at the National Competition for Young Managers (NCYM) conducted by the All India Management Association (AIMA) in 2011. Participants in NCYM deliberate on a theme of national importance. Winners at the regional levels qualify for the finals at national level. The competition provides an excellent platform for young managers to exhibit their talent, leadership skills, knowledge, experience, professional prowess and creativity which are important factors towards becoming “Leaders of Tomorrow.’

Past perfect. Present exciting. Future promising. The coming year promises to be one more step forward in the right direction. Human Resources practices at Bosch Limited have always been aligned to global practices. In 2011, Bosch Limited invested around 11,000 days of training for white collar employees. In 2012, it plans to increase this substantially to 22,000 man days of training. The focus in 2012 is to continue to build competencies in Innovation and Innovation Management. At least three seminars on Innovation Management are being planned with support from Germany. One such premium international program titled "Innovation Beyond Borders" will involve three leading universities from three global regions - ESMT (Berlin - Germany), Zhejiang University (Hangzhou - China) and Indian Institute of Management (Bangalore - India), including participants from all the three countries. More managers are due to qualify under the international qualification on "Project Management" which will qualify the participants also for PMP certification. This would help increase the level of efficiency among managers while delivering value through new projects lined up for India. The year will also see personalized training for individuals seeking development in specialist functions. India is a high growth market with huge manpower resources. The investment in building research and manpower training confirms the key role that the Bosch Group foresees for India. Bosch Limited is due to play a very important role in the future growth of the Bosch Group and with investments and programs as exciting as these, a huge impact is expected on the fronts of innovation and quality in the coming times.

Bosch Management Services India (BMSI) Consultant, Mr. R. Narayanan, conducting a Training course for BVC students. The mission of BMSI is to utilize knowledge and expertise of retired employees and add value to Bosch companies, create a platform to transfer knowledge and support development of future leadership.

Annual Report 2011

I

Report of the Directors | 17

the previous year.

The Directors have pleasure in presenting their SIXTIETH Annual Report together with the Audited Statement of Accounts for the year ended 31st

Investments

December, 2011. Capital investment during 2011 was higher than previous year, at `6,587 mio. as against `3,021 mio. in

Financial Results

2010.

The following are the financial results: (` Million)

Net Sales (excluding recovery of duties and taxes)

2010

79,294.7

66,305.0

The Board of Directors recommends a dividend of `50 per equity share for the year 2011 as against a

Of which Export Sales

10,344.1

8,460.7

Profit before tax

15,739.9

12,027.9

4,710.0

3,660.0

Less: Provision for tax Add: Deferred tax and tax adjustments relating to earlier years Profit after tax

195.7

221.1

11,225.6

8,589.0

of the Company since its incorporation in the year

1,569.9

1,255.9

- Special dividend at ` 85 per share

2,668.9

-

Tax on Dividend

254.7

208.6

Tax on Special Dividend

432.9

-

5,000.0

3,750.0

-

0.6

(4.8)

(3.6)

Balance carried forward Total

A special dividend of `85 per equity share was paid to anniversary of Bosch and to commemorate 60 years

- Dividend recommended at ` 50 per share (previous year: ` 40 per share)

Reversal of Dividend Distribution Tax

shareholders at the forthcoming Annual General

the shareholders in 2011, on the occasion of 125th

Dividend:

Capital Reserve

dividend of `40 per equity share in 2010. This dividend is subject to the approval of the Meeting.

Appropriations:

General Reserve

Dividend

2011

1951. The total dividend payout for the year 2011 is at `135 per equity share. Business Situation The automotive market was upbeat in the first half of the year 2011, continuing the growth momentum from the previous year. However, poor market sentiments, increased food & fuel prices and interest rates took their toll, what with the sale of passenger cars in October 2011 falling to the lowest in two years

1,304.0

3,377.5

forcing the industry to slash forward looking

11,225.6

8,589.0

forecasts. The widening price differential between petrol and diesel has further favoured the demand for

Net sales for the year 2011 grew by 19.6%. The Profit Before Tax (PBT) in 2011 as a percentage of net sales was at 19.8% as compared to 18.1% in 2010. The Profit After Tax (PAT) as a percentage of net sales was 14.1% in 2011 as against 13.0% in 2010. Material costs as a percentage to sales increased to 56% in 2011 as compared to 54.3% in 2010. Overall, the Profit Before Interest, Depreciation and Taxes, for the year shows an increase of 22.7% over

diesel cars. This notwithstanding, OEMs continued to launch new models in all market segments especially passenger cars. Overall, the automotive sector was able to sustain double digit growth aided by a solid performance in the first half of the year 2011 and partially aided by stable rural demand. Segment-wise, the commercial vehicle sector leads the pack with a strong 22% growth in 2011 over the previous year. Within this, Light Commercial Vehicle (LCV) segment grew by 30% driven by robust demand

18 | Report of the Directors I Annual Report 2011

The inline Pump developed by the Diesel Systems division for tractor segment conforming to the TREM 3A emission norms.

for sub 3.5 ton LCVs. Tractor segment continued to

outperformed expectations with sales from the

grow strongly with a 24% growth over 2010 backed

automotive segment growing by 19.1% and exports

by a bumper agricultural output. Two Wheeler and

breaking previously achieved records and clocking

Three Wheeler segments registered a growth of 18%

the best ever performance at `10,344 mio. with a

and 15% respectively.

growth of 22.3% over 2010.

In view of the above scenario, the Company

Our non-automotive business grew by 28.5% in 2011

Annual Report 2011

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Report of the Directors | 19

Common Rail System developed for Low Priced Vehicle segment that provides injection pressure upto 1600 bar and is based on the most efficient inlet fuel metering control system.

as compared to 2010. This growth is mainly

CRS for small engines to create value propositions

attributed to strong performance in the Power Tools,

for our customers. These value offerings have

Packaging and Machine Building divisions.

helped the Company bag significant orders from key OEMs amidst stiff competition. The growth

Automotive Technology

would have been much higher for the Diesel Systems business, but for the sluggishness experienced in

Diesel Systems business grew by 19.2% in the year

the second half of the year mainly in the passenger

2011 despite the ups and downs witnessed by the

car segment which grew by just 7% over previous

automotive market in 2011. The Diesel Systems

year. Within this, there was a clear shift in the

business continued to drive focused innovation on

market from Gasoline to Diesel passenger cars

the value line Common Rail System (CRS) for Light

owing to the high price differential between the two

Commercial Vehicles as also simplification of the

fuels.

20 | Report of the Directors I Annual Report 2011

Smart system solutions for two wheeler Electronic Fuel Injection segment.

Gasoline Systems business suffered a slowdown in

export market. The division also achieved overall

2011 and posted a de-growth of 6.4% due to

productivity improvement over previous year.

reduction in passenger car sales consequent to gasoline price increase. The division introduced the

In the year 2011, the division introduced “Thermal

first 2 Wheeler Engine Management Systems (EMS)

Protected Starters” for Commercial Vehicle

in series production for a customer project. Focus on

applications, which is an Indian platform project

system engineering in Low Price Vehicle and 2

going global. The division added renowned global

Wheeler systems for innovative and cost effective

OEMs to its portfolio of customers like Renault,

solutions to the Indian market, were the other

Volkswagen and Ford in 2011. The division bagged

highlights of the division.

“Best Supplier” award from the customer JCB India for delivery and quality.

Starter Motors and Generators business witnessed a strong growth of 63.1% in the year 2011 powered by

The Automotive Aftermarket division registered an

New Base Line Generators both in the domestic and

impressive growth of 15.2% in the year 2011. This

HX87 Starter Motor: A gear reduction Starter motor for Commercial Vehicle applications with thermal protection as add-on option.

Annual Report 2011

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Report of the Directors | 21

New Base Line Generator: A compact, high efficient, modular, internal fan Generator suitable for different customer interface.

continuous growth over the years is made possible

recorded highest ever sales and acquired new

owing to the division’s expanded footprint in the

customers. New products from the Diagnostics

market through roll-out of new concepts/ modules such

Centre of Competence were successfully launched in

as Express Bike Service (EBS), Tractor Points(TP) as

line with 'local-for-local' strategy. With one new part

well as extension of existing service networks at both 1st

number released per working day, the market

and 2nd Trade Level. The IT tools and systems (e.g.

coverage of all the Company’s products further

eFOCuS, FR Portal {for Field Representatives}) were

increased across vehicle segments.

also introduced for better sales and dealer management. Customer binding and brand building

Industrial Technology

initiatives further boosted our market competitiveness.

Packaging Technology (Verna (Goa) Plant)

Infrastructure projects including new sales offices and warehouses successfully completed in the year 2011,

The year 2011 was the most defining year for the

for better customer responsiveness.

Packaging Technology division as it achieved the highest turnover with 40% growth over 2010. At the

The OE filters, spark plugs and OE service blocks

The Company expanded its foot print in the market through roll-out of new concept modules such as Express Bike Service (EBS).

22 | Report of the Directors I Annual Report 2011

SVI 2600 B is a mid-speed intermittent motion vertical bagger. This machine is very user friendly, has higher output and has the ability to handle variety of films. This machine can pack a wide range of products like Snacks, Flour, Cereals, Grains, Seeds and Pet food among others.

end of the first quarter of 2011, the division bagged

Packaging Show in Delhi. A host of features like low

the single largest export order for a record number of

height, high output and easy accessibility allow for

60 machines. This project was successfully executed

improved packaging efficiency. During the same

and the machines delivered within the time frame.

occasion, the Belt weigher FBW4021B was previewed, which offers high output and accuracy.

The division expanded its product portfolio with the development of a low cost candy wrapping machine.

The division continued its success with the horizontal

This machine was also exhibited at Interpack,

form fill and seal machines bagging orders from some

Germany, for business promotion and was well

of the most prestigious customers in India. It also

received. On the vertical baggers, it had a very

executed first local order for pharmaceutical

successful launch of SVI 2600 B, at the India

machines of MLF and FLC lines.

Rotary Milling Machine suitable for both rough and finish milling of automotive parts viz. crank case, cylinder head of 2 & 4 wheeler, in single chucking.

Annual Report 2011

I

Report of the Directors | 23

The New state-of-art Power Tools training centre in Bangalore.

The year 2011 was also the year the division took up

Consumer Goods and Building Technology

construction activities for its new Plant. The

Power tools

enhanced capacity will provide the division with the right platform to scale higher growth levels.

The Power Tools division achieved an impressive

Industrial Equipment

of the few countries to register a consistently strong

growth of 22% in the year 2011 making ‘PT India’ one growth in the last 4 years. The Industrial Equipment division registered a good growth of 53.1% in the year 2011. Business with the

In 2011, the division launched its new state-of-the-

Company's customers grew by 23% in a highly

art training center in Bangalore created with an

competitive market.

investment of `50 mio. making it one among the largest training centres in the Bosch PT world. With

New and prestigious customers from the Auto and

this initiative, Bosch PT India becomes the first

Electrical equipment sectors were added to the

Power Tool player in the country to offer advanced

Company's customer list. The division witnessed a

training programmes to its customers and end users.

substantial growth in Tool Room activities during the year 2011. Exports to Europe were also an

Also launched in the year was the Fischer Exclusive

important achievement. The division focused on

Store at Kolkata to provide anchoring solutions to

building up of skills for the manufacture of

meet the growing demand in the region. The division

machines and equipments to meet international

inaugurated ‘Bosch System Specialist’ stores in nine

standards.

cities across the country including one at Goa which is the largest of its kind in the world. In the year 2011,

24 | Report of the Directors I Annual Report 2011

The Security Technology division showcased full range of security, safety and communications products at the IFSEC 2011 Trade Exhibition held at New Delhi in December 2011.

Bosch Power Tools India marked the 125th anniversary

bagged the Gold and Silver medals at the prestigious

of Bosch through an innovative campaign called

'TOOLYMPICS' contest-2011, in recognition of the

‘Power Drive 125’ spread across 20 different

various innovative market oriented activities.

locations in the country. Security Technology The division continued to supply tightening and pneumatic system solutions to major automotive

The Security Technology division achieved 18.4%

OEMs such as Volkswagen, General Motors, BMW

growth in the year 2011 compared to 2010. The division

and Mercedes Benz in India. Localization was one of

launched its distribution business for Video System

the core focus areas of the division. Manufacturing of

Products under the Brand name of ‘Advantage Line’. It

a 2kg Hammer began at the Bosch Power Tools Plant

established a new business –'Engineering Solutions &

in Bangalore making it only the third Plant in the

Software', catering to large integrated projects.

Bosch Power Tool World to do so. Bosch Accessories showcased tremendous growth by crossing `100

There were numerous key projects for the year 2011. To

crores turnover mark in 2011 doubling the turnover

mention a few – a prominent racing circuit, various state

in two years, rising to No.3 position. The division

assemblies, a major airport, steel plant and power plant.

2KG Hammer produced at the Bosch Power Tools Plant in Bangalore making it the third Plant in the Bosch Power Tool World.

Annual Report 2011

I

Report of the Directors | 25

The 40 kWp Solar PV installation on the roof of Bosch's New Administrative Building at Adugodi, Bangalore. The system generates nearly 150 units per day. Bosch Limited is a Channel Partner to Ministry of New and Renewable Energy (MNRE) for executing roof-top and off-grid solar PV projects. This also enables Bosch to help customers avail govt. benefits associated with such installations.

The division participated in IFSEC 2011, lauded as

Competition and challenges in our business sectors

one of the most important trade exhibitions for Commercial & Homeland Security. A full range of

As in other regions of the world, the year 2011 was a

security, safety, and communications products from

testing year for the Indian automotive industry. In

Bosch were showcased at this important platform.

addition to the demand fluctuation from customers

Solar Energy

aggravated the cost pressures of manufacturers.

In the year 2011, the Solar Energy division launched

most challenging years to do business in.

owing to the recession, volatile raw material prices High inflation and labour issues made it one of the solar energy products and services in India. To capitalize on the potential of the nascent Indian solar

However, the Company was among the very few

photovoltaic market, the division introduced 60 cell

organizations that were able to convert this apparent

mono-crystalline silicon module and Micromorph thin

downside into an opportunity. With efficient

film modules. Along with photovoltaic modules, the

processes and systems, the Company ensured that it

division also offered project development services

remained cost competitive, delivering innovation

including engineering, procurement and construction

and value to our customers, thereby maintaining its

of solar power plants. Since June 2011, the division

market share.

delivered 1000 kWp of thin film modules. The Company's aggressive engineering, Thermo Technology

manufacturing, marketing and sales initiatives will

The Thermo Technology division started its activities

our reach and strengthen the leadership position.

in 2011. It ventured into sales and service of

Further, our clear long-term focus and sustained

continue into 2012 with renewed vigor, to expand

industrial boilers coming from Germany and China.

investments in future technologies, prepares us for

The series manufacture of solar flat plate collector,

the uncertainities that lie ahead and helps us

storage tank and mounting structure for domestic

enhance the Company's value proposition to all

and commercial hot water applications are planned

stakeholders.

in 2012.

26 | Report of the Directors I Annual Report 2011

Plants

Excellence in Water Management by CII and the

Bangalore

Best Employer Certificate by the Rajasthan

Bangalore Plant attained the highest production level

Government.

in all its products viz., Inline Pumps, Elements, Delivery Valves, Common Rail Pumps, Glow Plugs

Naganathapura

and Single Cylinder Pumps in the year 2011.

In the year 2011, substantial ramp ups in New Base Line generator and Hx Starter business were

The Plant invested `185 mio. in 2011 towards

resorted to by the Plant. The Plant achieved a record

expansion projects for meeting increased demand

production of 32 mio. units of Spark Plugs in the year

for the products manufactured. A milestone of

2011.

producing 1 million ‘Common Rail Pumps’ and 15 million ‘A pumps’ was reached in the year 2011.

Lean Concepts were implemented vigorously in the Plant. Energy conservation measures were put in

After being awarded the CII-Exim Bank award for

place during the year. The Plant maintained cordial

Business Excellence at the national level in the year

Industrial relations and the employees of the Plant

2009, the Bangalore Plant sustained and further

worked as a team towards achieving better results.

improved on living business excellence through the assessment carried out internally.

Information Technology (IT)

Nashik

The maturity of IT-enabled business processes using

During the year 2011, the Nashik Plant achieved the

SAP were assessed and showed improvements over

highest production levels of Nozzle holder assembly,

the previous year. A focused effort on improving the

DSLA Nozzle and Common Rail Injectors. The Plant

usage of planning tools within SAP is in progress. A

manufactured the 100 mio. NHA-Injector, which was

new Business Intelligence Platform has been put in

a new milestone achieved. To keep pace with the

place to support business reporting requirements

growing demand, the Plant made an investment of

and tracking of Key Performance Indicators.

`2,715 mio. in its production facilities. Improvements were achieved in Information The Plant was honored with CII-EXIM Bank’s

Security, Data protection and Control of

‘Commendation for Significant Achievements in

Authorizations. Formal processes exist to

Business Excellence’ for the year 2011 as well as the

periodically audit and report results.

‘Golden Peacock Environment Management Award’ from the Maharashtra State Government.

Change Initiatives Continuous Improvement Process (CIP)

Jaipur In 2011, the Jaipur Plant achieved its highest

The year 2011 was a year which had good balance

production since its inception in the year 1999. The

between CIP in Direct areas and Indirect areas. Direct

Plant realized the highest ever single investment of

areas showcased their strength with Conventional

`753 mio. towards enhancing the capacities and

CIP and LeaderCIP which laid the platform to make

further expansion.

improvements in Quality, Cost and Delivery.

The year 2011 has also been a year of awards and

achieve system CIP targets and LeaderCIP enabled

Conventional CIP enabled all value streams to accolades for the Plant. It received the Best Supplier

leaders to lay more focus and guide their respective

Award from Tata Cummins, Supply Linearity Award

teams in meeting organizational targets. Value

from Ashok Leyland, the National Award for

Stream Design in Indirect Areas (VSDiA) took a front

Annual Report 2011

I

Report of the Directors | 27

stage in eliminating waste and in reducing lead time

integrates the various cross functions in the Plants

which directly acted as a backbone for direct areas.

and aligns them towards meeting the INDS (Diesel

VSDiA Improvements were effective in Plants as well

Systems India) Vision and Mission. DBE was started

as in corporate departments within the Company.

in 2005 at the Diesel System manufacturing Plants in

Team Oriented Production (TOP), Voluntary Lernstatt

adopted the European Foundation for Quality

India (Bangalore, Nashik and Jaipur) and have Team and Shop Floor CIP increased the involvement

Management (EFQM) model of Business Excellence

in CIP activities in 2011 compared to 2010.

to improve the organization effectiveness in a holistic

LeaderCIP trainings were launched in 2011 across all

manner. Regular assessments are conducted at all

managerial levels to follow the PDCA-Guided process

Plants as a health check to identify strengths and

approach in CIP. The yearly “GLS CIP 2011” was held

focus areas to work upon. The RADAR approach is

in order to share good CIP practices across the

used extensively at INDS where we know the Results

Company with the participation of Executive

that we have to achieve, a clear cut Approach is

Directors. CIP teams received accolades in regional,

defined and they are Deployed. Assessment and

national and international competitions organised by

Refinement help us to continuously improve the

recognized quality circle forums.

systems and processes in our journey towards

Bosch Production System (BPS)

organisation and its people. Key performance

BPS in 2011 played a very prominent role focusing on

indicators are measured to enable the achievement

Business Excellence by enabling maturity of the

a set of guided principles that were implemented in

of required results as a cause and effect with respect

order to achieve business targets of the Company.

to all the key stakeholders.

The focus in 2011 was to improve in three areas viz. “Source, Make and Deliver”. The Company won the

INDS is striving towards institutionalizing a culture

BPS award in the ‘Source’ category by establishing

of ‘Living Business Excellence’ as 'Business

good BPS Compliant suppliers. BPS Knowledge

Excellence at work' by incorporating the same in the

training was extended across all Plants with a view to

INDS Vision & Mission. To deploy this vision theme,

have a common understanding in all areas and to

INDS long term strategy map has one of the bubbles

measure the effectiveness within the Company. It was

as 'living BE'. The strategic measures / targets are

found that value stream managers were orienting /

deployed across Plants and connected corporate

aligning themselves to attain system maturity and

functions through Policy Deployment process.

business Key Performance Indicator (KPI) targets. The INDS have won many accolades in this exciting Standardized and Reusable packaging of raw

journey. Bangalore Plant won the coveted CII-EXIM

materials and finished goods initiatives helped

Bank award for business excellence in 2009, Nashik

business divisions to eliminate waste in

Plant won the CII –EXIM Bank Commendation for

transportation and adopt environment friendly

significant achievements in Business Excellence' for the

concepts. In order to reduce lead time, the entire

years 2010 and 2011 and Jaipur Plant was recognized

value chain was focused on many localization, cost

with Commitment to Business Excellence in 2008.

reduction (RPP) projects, inventory reduction projects were initiated. Shop Floor Management

First Strategic Assessment was conducted at INDS in

Cycle (SFMC) and TPM models were implemented

January 2012. Structured assessment document as a

successfully in many locations.

description of entire INDS was prepared by strategy/change teams with respect to 15 key

Diesel Systems Business Excellence

business related topics such as innovative products,

The Diesel Systems Business Excellence (DBE)

cost competitiveness etc. A team of senior business

28 | Report of the Directors I Annual Report 2011

Comprehensive training has always been the hallmark of the Bosch Vocational Centre. During the first year, all apprentices, regardless of their trades, undergo basic training. In the subsequent phases of their training, apprentices undergo inplant training, job-oriented training and lab practice. The Bosch Vocational Centre is equipped with classrooms and a full-fledged workshop which has kept pace with changing technology.

completed the 50 years of its establishment of the

leaders from Diesel Systems India and Diesel Systems Bosch lead by an external Assessor from

Centre. The BVC was functional as early as 1960. The

EFQM carried out the assessment and presented the

BVC’s valuable services over the past fifty years in

key findings to INDS management. The maturity level

imparting technical education and training have

of INDS in terms of Business Excellence is currently

benefited many talented young people. Bosch

at a level of ‘Recognized for Excellence’ based on the

Vocational Centre has the fame of producing young

band of results achieved. Based on key areas of

skilled work force meeting the present day

improvements identified during the assessment,

requirements of Industries.

teams have initiated projects / measures to further BVC won five gold medals for all the five trades

enhance the organizational effectiveness.

participated at the 86th All India Skill Competition for Bosch Vocational Centre

Apprentices organized by the Directorate General of

The year 2011 is indeed a special year for Bosch

Employment and Training (DGE&T), Ministry of

Vocational Centre (BVC) since it marked the

Labour and Employment, Government of India in

celebration of Golden Jubilee year for having

May 2011.

As part of the 125 Anniversary year celebrations, Dr. Abdul Kalam was at the Bosch Vocational Centre to present awards to the students of the centre. The centre is equipped with a team of 23 dedicated and professionally qualified faculty members. The periodic updation of knowledge of faculty by exposing them to the relevant workshops, seminars, deputations to model institutes both in India and abroad remains our commitment to keep in pace with the changing trends.

Annual Report 2011

I

Report of the Directors | 29

The Company has consistently been receiving accolades and recognition for its contribution to the industry. Displayed are some of the awards received by the Company in 2011 (Left to Right) Overall performance of the year 2010 award from John Deere at their Supplier Meet; Tata Motors award for excellence in “Technology and Innovation” at the Tata Motors National Vendor Meet 2011; Subros Car & Bike award 2012 in the ‘Best Automotive Component Manufacturer’ category.

BVC being the “Best in Class” in the country also sustained excellence in the field of Vocational Training by increasing tally of Gold medal winners to

effectiveness. •

Recognition certificate from Maruti Suzuki for superior performance in the field of timely capacity enhancement for the year 2010-2011.



Subros Car & Bike award 2012 in the ‘Best Automotive Component Manufacturer’ category.

191. BVC received the ‘Best Establishment’ Award for the 42nd time. BVC also continuously invests in upgrading facilities and infrastructure to maintain high standards of training. Awards and Recognition The Company won several awards, as recognition of the efforts put in by the Company: •

Award for achieving targets in delivery year 2010 by Toyota in April 2011 in the area of “Localization for Etios Project”.



Award from Cummins for the best supplier in the category "Assemblies" at the regional Cummins supplier conference held in Pune in June 2011.



“Overall Performance of the Year 2010” award from the John Deere at their Supplier meet held in June 2011.



Tata Motors award for excellence in “Technology and Innovation” at the Tata Motors National Vendor Meet 2011, held in Mumbai in July 2011.



Bosch Group was awarded the ‘Presidents Award’ given by Mahindra & Mahindra for overall performance of the Company in streams such as supplies, quality, development and cost

Bosch India Foundation Bosch India Foundation, with its vision “Enabling Lives and Livelihood”, increased its reach to seven locations in India. By the end of its 3rd year of its functioning, the Foundation had benefited 3,515 youth of various underprivileged communities through support of skill trainings and medical projects. In 2011, vocational trainings were introduced in eight new trades such as automobile service mechanic, tractor mechanic, motor winding, AC mechanic, masonry, carpentry etc., through partnership with 20 committed NGOs who are in close contact with the community and its needs. Yet another highlight was the vocational training support extended to 84 mentally challenged and spastics youth across three locations in India. The Foundation supported 20 surgeries for young children with complex orthopedic problems and

30 | Report of the Directors I Annual Report 2011

helped them to walk. The surgeries are conducted by Sparsh Vachana to a select set of 200 underprivileged children every year. The Foundation also continued its support to the Gujarat Cleft and Craniofacial Research Institute (GCCRI) which conducts free corrective surgeries for those born with facial deformity. Industrial Relations Industrial relations at all Plants and other establishments continued to be cordial excepting Bangalore Plant where the Union and Workmen went on a sudden Tool Down Strike from September 28, 2011, demanding that all outsourcing and ancillarization activities must be stopped. The unreasonable demand was rejected outright by the management and taking note of facts by the State Government of Karnataka, in exercise of powers vested in them vide section 10(3) of Industrial Disputes Act (amendment) 1947, issued orders on October 12, 2011 prohibiting the strike forthwith. The Union called off their strike unconditionally on October 13, 2011. Normal Plant operations had been restored for all workmen from October 14, 2011.The Directors place on record their deep appreciation of the sincere and dedicated teamwork by employees at all levels to meet the quality, cost and delivery expectations of our customers. Subsidiary Company As the aggregate assets and income of MICO Trading Pvt. Ltd., as on December 31, 2011 is not material, no consolidated financial statements under Accounting Standard 21 “Consolidated Financial Statements” as notified under section 211(3C) of the Companies Act, 1956, has been prepared. As required under Section 212 of the Companies Act, 1956, annexed hereto are the Audited Statement of Accounts, the Report of the Board of Directors and Auditors’ Report for the year ended 31st December 2011 of MICO Trading Pvt. Ltd. Directors Dr. Manfred Duernholz has been re-appointed by the Board as Joint Managing Director of the Company for a further period of one year with effect from January 01, 2012. The Board also appointed Mr. Soumitra Bhattacharya, Executive Vice President of the

Company as Alternate Director to Dr. B. Bohr with effect from July 1, 2011. Names of companies/firms in which Directors of the Company hold/held office as Director/Partner are given below: Dr. A. Hieronimus -

MindTree Ltd. (Chairman)

-

Bosch Rexroth AG (Member of the Board)

Dr. B. Bohr -

Robert Bosch GmbH (Member of the Board)

-

ZF Lenksysteme GmbH (Member of Supervisory Board)

Mr. B. Steinruecke -

Indo German Chamber of Commerce. (Director General)

-

FAG Bearings India Ltd.

-

Zodiac Clothing Company Ltd.

-

HDFC ERGO General Insurance Company Ltd.

-

Apollo Munich Health Insurance Company Ltd.

Mr. B. Muthuraman -

Tata Steel Ltd. (Vice Chairman)

-

Tata International Ltd.(Chairman)

-

Tata Industries Ltd.

-

Tata Steel Europe Ltd.

-

Tulip UK Holdings No.2 Ltd.

-

Tulip UK Holdings No.3 Ltd.

-

Tata Incorporated, New York.

-

Tata Africa Holdings (SA) (Pty) Ltd.

-

Strategic Energy Technology Systems Ltd.

-

Confederation of Indian Industry (President)

Mrs. Renu S Karnad -

Housing Development Finance Corporation Ltd.

-

Credit Information Bureau (India) Ltd.

(Managing Director) -

GRUH Finance Ltd.

-

HDFC Asset Management Co. Ltd.

-

HDFC ERGO General Insurance Co. Ltd.

-

HDFC Property Ventures Ltd. (Chairperson)

-

HDFC Standard Life Insurance Co. Ltd.

-

Indraprastha Medical Corporation Ltd.

-

HDFC Bank Ltd.

-

AKZO Nobel India Ltd.

Annual Report 2011

-

EIH Ltd.

-

HDFC Sales Pvt. Ltd. (Chairperson)

I

Report of the Directors | 31

(Vice President) -

Confederation of Indian Industry

-

Feedback Infrastructure Services Pvt. Ltd.

(Committee Member)

-

G4S Corporate Services (India) Pvt. Ltd.

Dr. Manfred Duernholz

-

Value and Budget Housing Corporation (India) Pvt. Ltd.

-

Credila Financial Services Pvt. Ltd. (Chairperson)

-

MICO Trading Pvt. Ltd.

Mrs. Renu S Karnad, Mr. Prasad Chandran and Mr. V.K. Viswanathan are liable to retire by rotation and offer themselves for re-election.

-

Lafarge India Pvt. Ltd.

-

HDFC Education and Development Services

Mrs. Renu S Karnad, 59, holds a Bachelor Degree in

Pvt. Ltd. (Chairperson)

Law from the University of Bombay and Masters

-

Transunion LLC, Chicago.

Degree in Economics from Delhi School of

HDFC PLC, Maldives.

Economics. She joined HDFC Ltd in 1978 in the legal

Mr. Prasad Chandran

and credit department and grew to become the head

-

BASF India Ltd. (Chairman and

of lending business of HDFC Ltd. She is responsible

Managing Director)

for the lending operations of HDFC, both retail as well as corporate, framing policies and strategies for

-

BASF Asia Pacific (India) Pvt. Ltd. (Chairman)

-

BASF Catalysts (India) Pvt. Ltd.

mortgage lending by HDFC, development of new

-

BASF Lanka Private Ltd.

retail products, expansion of branch network and

-

BASF Bangladesh Ltd.

other channels of distribution, budgeting and

-

BASF Grameen Ltd.

-

Indo German Chamber of Commerce. (Committee Member)

-

Federation of Indian Chamber of Commerce. (Executive Committee Member)

-

Bombay Chamber of Commerce and Industry. (Managing Committee Member)

-

The Energy and Resource Institute (Committee Member)

Mr. V. K. Viswanathan

management information system, for setting goals and targets at the national, regional and branch levels, monitoring performance vis-à-vis the budgets, development of new asset and liability products, introduction of innovative and structured products, coordinating resource raising from domestic and international markets, negotiating and finalizing financing facilities from multilateral agencies such as World Bank, Asian Development Bank,

Robert Bosch Engineering and Business

Commonwealth Development Corporation (CDC) and

Solutions Ltd. (Chairman)

KfW, communicating with equity analysts and

-

Bosch Rexroth (India) Ltd. (Chairman)

international investors besides also coordinating

-

Bosch Chassis Systems India Ltd.

with regulators such as the National Housing Bank

-

MICO Trading Pvt. Ltd.

and liaising on behalf of HDFC with the Government

-

Foundation Brake Manufacturing Ltd.

of India and the State Governments and Housing

-

Bosch Electrical Drives India Pvt. Ltd.

Industry etc. As a member of the Investment

-

Bosch Automotive Electronics India Pvt. Ltd.

Committee of HDFC, she partakes in the decision

(Chairman)

making for investments by HDFC in debt, equity and

-

-

BSH Home Appliances Pvt. Ltd.

other related treasury products. She is currently

-

Hagglunds Drives (India) Pvt. Ltd.

functioning as Managing Director in HDFC Ltd.

-

FLSmidth Pvt. Ltd.

-

Indo German Chamber of Commerce.

In 1984, she was awarded Pravin Fellow - Woodrow Wilson School of International Affairs, Princeton

32 | Report of the Directors I Annual Report 2011

University, Princeton, NJ. She has attended several

sustainability issues of the BASF Group in the Asia

senior management programs on financial

Pacific Region. Mr. Chandran is an independent

management, urban planning, political science and

Director of the Company (appointed on 01.01.2009).

women’s studies. Mrs. Renu S Karnad is an

He is the member of Audit Committee, Shareholders’

Independent Director of the Company (appointed on

/ Investors’ Grievance Committee, Remuneration

01.04.2007). She is the Chairperson of the Audit

Committee and Share Transfer Committee of the

Committee, member of Shareholders’ / Investors’

Board. He does not hold any shares in the Company.

Grievance Committee, Investment Committee and Property Committee of the Company. She does not hold any shares in the Company.

Mr. V. K. Viswanathan, 61, is a Bachelor of Commerce from Madras University and a Chartered Accountant. Prior to joining the Company, he was the Group

Mr. Prasad Chandran, 59, is a post-graduate in

Treasurer & Head of Mergers and Acquisitions with

Chemistry and has a Masters degree in Business

Hindustan Unilever Limited with which group he was

Administration. He has also received Advanced

associated in various capacities for 17 years.

Management Education from Institutes in the US, UK and Japan. He is the Past President of the Indo German Chamber of Commerce (IGCC). He is also the cochairman of the National Committee on Chemicals and Petrochemicals of the Confederation of Indian Industries (CII), Member of the Executive Committee of Federation of Indian Chambers of Commerce & Industry (FICCI) and Managing Committee Member of the Bombay Chamber of Commerce and Industry. He is also an active participant in a number of trade/industry delegations of the Government of India. Mr. Chandran heads the “Million Minds” Project. This

Mr. Viswanathan joined the Company as Chief General Manager in August 1998. After a brief orientation in the Company, he took up an assignment in the Diesel Systems Division of Robert Bosch GmbH, Germany from September 1998. Upon completion of the assignment, he returned to the Company in November 2000. Mr. Viswanathan joined the Board as Additional Director and Joint Managing Director on 01.01.2001, responsible for Finance, Administration and IT Coordination. Upon assuming new responsibilities in Robert Bosch Corporation, Farmington Hills, USA (Robert Bosch North America), Mr. Viswanathan

is conceptualized by him to improve governance and

ceased to be a Director and Joint Managing Director of

fight corruption. Whilst implementing the BASF Global

the Company from February 28, 2006.

values and principles, he addresses policy issues on corruption to raise the standards of governance in India. The “Million Minds” project sensitizes stakeholders and creates voluntary action groups in different parts of the country. He is associated with NGOs like Public Concern for Governance Trust (PCGT) and Coalition Against Corruption (CAC) etc. Mr. Chandran is the Chairman and Managing

Upon completion of his assignment with Robert Bosch Corporation, Farmington Hills, USA (Robert Bosch North America), he was appointed as Additional Director and Joint Managing Director with effect from 01.11.2007 and from 01.02.2008 as Managing Director responsible for Automotive Aftermarket, Starters and Generators, Packaging Machine, Power Tools and Security Technology.

Director of BASF India Limited. In addition to his

Mr. Viswanathan is a member of Shareholders’/

direct responsibilities, he is a member of the BASF

Investors’ Grievance Committee, Share Transfer

Human Resources Council, which oversees the

Committee, Investment Committee and Property

personnel policies and the Sustainability

Committee of the Company. He does not hold any

Development Council, which oversees the

shares in the Company.

Annual Report 2011

Particulars of Employees

Auditors

I

Report of the Directors | 33

Information in accordance with the provisions of

M/s. Price Waterhouse & Co., Chartered Accountants,

Section 217(2A) of the Companies Act, 1956, read with

the retiring auditors, are eligible for re-appointment.

Companies (Particulars of Employees) Rules, 1975, as

Directors’ Responsibility Statement

amended, forms part of this Report. However, as per provisions of Section 219(1)(b)(iv) of the Companies Act, 1956, this Report and Accounts are being sent to the Shareholders of the Company excluding the

Pursuant to Section 217(2AA) of the Companies Act, 1956, the Board of Directors report that: •

Statement of Particulars of Employees under Section

followed along with proper explanation relating to

217(2A) of the Companies Act, 1956. Any shareholder

material departures, if any.

interested in obtaining a copy of the said Statement may write to the Company Secretary at the Registered Office

In the preparation of the annual accounts, the applicable accounting standards have been



Accounting policies have been selected and applied consistently and the judgments and

of the Company and the same will be sent by post.

estimates made are reasonable and prudent so as

Corporate Governance

to give a true and fair view of the state of affairs of

A Report on Corporate Governance approved by the

the Company at the end of the financial year and of

Board of Directors of the Company and a certificate

the profit or loss of the Company for that period.

from the Practicing Company Secretary is set out in the Annexure to the Directors’ Report. The Company



Proper and sufficient care has been taken for the maintenance of adequate accounting records in

has fully complied with the Corporate Governance

accordance with the provisions of the Companies

practices specified under the Companies Act, 1956,

Act, 1956, for safeguarding the assets of the

and the listing agreement with the Stock Exchanges.

Company and for preventing and detecting fraud

A Code of Conduct for Directors and Senior

and other irregularities.

Management, Code of Conduct for Prevention of Insider Trading, Whistle Blower Policy, Rules and Regulations of Service Conduct for Managerial and Superintending



The annual accounts have been prepared on a going concern basis.

Acknowledgements

Staff, Code of Business Conduct etc., effectively support

The Directors express their gratitude to the Central

the Corporate Governance processes.

Government and the State Governments of Karnataka,

A Management Discussion and Analysis Report also

Maharashtra, Rajasthan and Goa for the support given

accompany this report.

to the Company. The Directors also thank all

Energy, Technology, Foreign Exchange, etc. The report in respect of conservation of energy, technology absorption, foreign exchange earnings

customers, dealers, suppliers, financial institutions and banks, members and others connected with the business of the Company for their co-operation.

and outgo, as required under Section 217(1)(e) read

For and on behalf of the Board of Directors

with The Company’s (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is set out in

Bangalore

the Annexure to the Directors’ Report.

28th February 2012

Albert Hieronimus Chairman

34 | Financials at a glance I Annual Report 2011

Financials at a glance (` Million) 2011

2010

2009

2008

2007

2006

2005

2004

2003

2002

Sales

79725

66305

47498

45416

42796

37837

29775

23277

18979

15507

Of which export sales

10344

8461

5855

6845

6730

6270

4231

3997

3256

2490

Profit before tax

15740

12028

7934

8566

8560

7983

5290

5635

3836

2005

4514

3439

2028

2227

2468

2503

1859

1887

1486

664

Profit after tax

11226

8589

5906

6339

6092

5480

3431

3748

2350

1341

Profit before appropriation

11226

8589

5906

6339

6092

5480

3431

3748

2350

1341

Capital redemption reserve

-

-

6

-

-

-

-

-

-

20

Capital reserve

-

0.6

35

-

-

-

-

-

-

-

Less: Provision for tax on income

Appropriations

Interim Dividend

2669

-

-

-

-

385

-

-

-

10

(%)

(850)

-

-

-

-

(120)

-

-

-

(3)

Dividend

1570

1256

942

801

801

128

385

321

208

128

(%)

(500)

(400)

(300)

(250)

(250)

(40)

(120)

(100)

(65)

(40)

Tax on dividend

255

209

160

136

136

76

57

42

27

-

Tax on interim (Special Dividend)

433

-

-

-

-

-

-

-

-

-

(4.8)

(3.6)

-

-

-

-

-

-

-

(10)

-

-

-

-

-

-

-

-

16

-

relating to 2008

-

-

(15)

-

-

-

-

-

-

-

General Reserve

5000

3750

4500

5000

4800

4500

2500

2700

1700

900

Balance carried forward

1304

3377

278

402

355

391

489

685

399

293

11226

8589

5906

6339

6092

5480

3431

3748

2350

1341

314

314

314

320

321

321

321

321

321

321

Reserves

46970

40666

33538

30634

25313

20099

15208

12218

8833

6734

Net Worth

47284

40980

33852

30955

25634

20420

15528

12539

9154

7055

Gross Block

34301

30238

28712

27286

23459

21027

18290

14894

14392

14263

Net Block

6201

4360

5133

6086

4871

4488

3838

1947

1927

2290

Additions to Gross Block

4423

1776

2121

4248

2943

3177

3881

1019

680

940

358

274

187*

198*

190

171

107

117

73

42*

Tax on dividend written back Tax on dividend for 2002 Dividend & tax on dividend written back

Total Paid-up Capital

Earnings per share (EPS) (`)

* Based on weighted average of the number of shares. Previous years’ figures have been recast/regrouped wherever necessary. EPS for the years 2002 & 2003 has been changed to bring the same in line with the face value of Rs. 10 per share (upto 2003: face value of Rs. 100 per share).

Annual Report 2011

I

Financials at a glance | 35

90000 50

80000 70000

40

60000

30

50000

20

40000

10

30000 0

20000

06

07

08

10000

09

ROCE

10

11

10

11

RONW

0 06

07

08

09

10

11

1000

12000 10000

100

8000 6000

10

4000 2000

1

0 06

07

08

09

10

11

06

07

08

09

EPS

DPS

Profit After Tax (PAT) as % of Sales 22000 20000 20

4575

18000 2633

16000

16

2613

12000

12

2633 2950

10000 8

8000 6000

4

3475

2226

2060

2000 06

07

08

09

10

11

3211 2613 2549

1719 3475 3489

3612 5451

2427 2549

4534

5451

06

07

5131

4113

2427

2430

4000

0

4134

2226

14000

3757

5637

4297 3757

5253

6371

0 08

09

10

11

36 | Annexure to the Report of the Directors I Annual Report 2011

Annexure to the Report of the Directors

[Particulars required under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988] A. Conservation of energy Energy conservation initiatives received highest priority across all locations of the Company during the year 2011. The measures are not only driven by cost reasons but also because of Company’s strong commitment towards reducing CO2 emissions. Along with conservation initiatives within the Plant, the Company is looking at harnessing solar power. Two projects viz., installation of photovoltaic’s and light tube to harness solar power, have yielded very good results.

-

c) Impact of the above measures During the last year 2011, the implementation of energy conversation measures has resulted in net electrical energy savings of 3.47 Mio. KWh annually. B. Technology absorption (a) Research and Development 1. Specific areas in which R&D was carried out. Fuel Injection Equipment (FIE): Diesel -

Fuel efficient Common Rail system was developed for the Low Price Vehicle segment. With focus on single cylinder engines, development of fuel injection system for the forthcoming emission norms for this price sensitive market segment is in progress.

-

With advance engineering department testing new concepts for FIE and Diesel powertrain is the focus for the domestic single cylinder, commercial vehicle and off-highway segments.

-

To evaluate the upcoming Bharath Stage 5 norms, additional infrastructure have been invested for Exhaust Gas Treatment and FIE development.

a) Measures taken during the year 2011 -

Optimization of Heat Treatment (HT) processes.

-

“Sleep Mode” of operation for Sealed Quench Furnaces in Heat Treatment operations.

-

Change over to new energy-efficient cleaning machines.

-

Introduction of “Induction Lamps” for production hangars.

-

Introduction of “Turbo Vent” fans in place of exhaust fans.

-

Reduction in fan power by replacing heat exchangers of ventilation Plant.

-

Removal of air cooled chiller on HTF (High Tension Flow) bench.

-

Installation of Variable Frequency Drives (VFD).

-

Modification on chilling unit, increase in chilled water temperature by 2°C.

-

Change over to high energy efficient air drier and water pumps.

-

Auto switch off of refrigeration.

-

Air leakage corrections.

-

Harnessing solar energy.

Optimization in usage of compressed air, HVAC (heating, ventilation, and air conditioning) system.

Gasoline Systems: -

Development of Engine Management Systems (EMS) for port fuel injection (Gasoline, CNG) and all related components: Air Management, Sensors & Ignition, Fuel Supply and Fuel Injection.

-

System engineering and component development capability, especially for two wheeler segment, with corporate support and local expertise for specific market requirements.

-

Technical Center and Component Laboratory with state-of-the-art infrastructure and equipment.

b) Additional proposals being implemented

Starters and Generators:

-

Optimization of cleaning media temperature in washing machines.

-

-

Reduction in fan power by replacing heat exchangers of ventilation Plant.

-

Starter Motor and Generator for the Low Priced

-

Introduction of “Turbo Vent” fans.

-

Gear reduction Starter Motor for the HCV and

-

High efficiency Compact Generator with vacuum

-

Elimination of heaters and pumps in HWG system.

-

Introduction of low pressure air line.

-

Replacement of air operated pump by electrical pump.

Starter Motor with thermal protection for overload/abuse operations in field. Vehicles. Off-highway applications. pump for SUVs.

Annual Report 2011

Spark Plugs: -

Annexure to the Report of the Directors | 37

Increase in competencies across business sectors to take advantage of the potential in the

Plugs: ‘V’ type extra long thread reach

Indian market through efficient processes and

spark plugs for compact new

systems.

generation engine. -

-

Launch of new generation Spark

I

‘Y’ type extra long thread reach Spark

-

Improve performance levels of spark plugs in terms of acceleration/drivability.

plugs: For new generation engine as primary spark plug along with two

4. Expenditure on R&D

secondary spark plugs (3 wheeler spark plugs/cylinder, 2 wheeler application). Glow Plug & Glow Control Units: -

Development of new platform Glow Plugs with higher length and reduced

-

` Million a)

Capital

341

b)

Revenue

804

c)

Total

d)

Total R & D expenditure

tip diameter.

as a percentage of total

Development of Glow Plugs for

turnover

1145

1.44%

European and American aftermarket through reverse engineering. -

Development of Glow Control Units

customers and the end users, as enumerated below. The ‘Value Line’ Common Rail system developed

The Company in its efforts to keep updated

2. Benefits derived The initiatives have resulted in benefiting our

-

1. Efforts made The Company faced considerable challenges in the year 2011 went past. With the efficient processes and systems, Company ensured that it remained cost competitive to its customers.

for BS4 engine applications

-

(b) Technology absorption, adaptation and innovation

for light and medium duty commercial vehicles

with the latest technology, made continuous

provides injection pressure upto 1600 bar and

exchange of information with member

this low cost system meets Bharat Stage 3 and

companies of the Bosch Group worldwide.

Bharat Stage 4 emission norms in compliance

This has enabled the Company to keep abreast

with latest emission and legislative regulations.

with the latest developments in product

OE manufacturers are provided with the

technology, manufacturing process and

Company’s products that suit the Indian

methods, quality assurance and improvement,

requirements in order to reduce fuel

marketing, management systems and benefit

consumption.

out of mutual experience.

-

High performance segment spark plugs.

The Company has, over the years built the

-

Design solutions for customer specific

requisite infrastructure and technically

requirement for spark plugs and improvement in

competent engineers to translate the latest

the business thereby.

technical know-how into products that meet the requirements of local and international

3.

Future plan of action

customers and will continue to do this in

-

Projects on energy conservation to enable

future.

reduced carbon-dioxide emissions from our Plant locations thereby reducing the carbon foot print. -

Extend the product portfolio relevant to the low price vehicle segment.

-

Increase the depth of localisation.

2. Benefits derived The benefits are the same as enumerated in B (a) 2 above.

38 | Annexure to the Report of the Directors I Annual Report 2011

3. Technology imported during the last 6 years

4. Technology absorption The Company’s membership in the Bosch Group

In addition to the existing technical collaborations for products in the field of Fuel

gives it access to the future technologies. The

Injection Equipment, Spark Plugs, Auto

Company is, as a result, able to offer at any point

Electrical, Power Tools, Compact Alternators,

of time state-of-the-art technology to meet the

etc., the Company has entered into technical

requirements of its national and international

collaborations for the following products:

customers. C. Foreign exchange earnings and outgo

Common Rail Diesel Fuel Injection system

2006

Baseline Generators

2008

` Million a)

Throttle Position Sensor and Assembly Lines (ATMO)

b)

10,344

Total foreign exchange used and earned:

i) Packaging Machines, ii) Electronic Control Units

Exports

2009

Manufacturing of

Export activities:

2010

Foreign exchange used

Manufacturing of

(including for capital assets)

33,786

i) Compact Direct Starter Motor,

Foreign exchange earned

10,801

Start-Stop Motor-SSM1, SSM-Eco, ii) Common rail Electronic control Units-EDC17, iii) Temperature Sensor TF-W and iv) VP37, product sub-class VE-EDC.

2011

Annual Report 2011

I

Report on Corporate Governance | 39

Report on Corporate Governance

The Company is committed to good Corporate Governance practices aimed at increasing value for all stakeholders.

• Customer Centric Culture •QCD

RB IFI Others

: 71.18% : 9.84% : 18.98%

• Supplier relations •QCD

• Code of Business conduct • Bosch Values • Development • Welfare • Safety

• Compliance with Central/State/ Local laws

• Environment • Pollution Control • Social responsibility

Quality The founder Robert Bosch’s statement that “quality is the most valued asset” has remained an unwavering guideline for Company’s business policies. The customers put their trust in our ability to deliver high quality in all our activities. This trust is based on our strength in implementing necessary improvements in a fundamental and lasting way. The Company firmly believes in the Bosch quality principles as laid down in our quality manual.

Shareholders The equity shares of the Company were listed in the

Suppliers

year 1969 in The Bombay Stock Exchange Ltd.,

Suppliers are our partners in progress. The Company

Mumbai, pursuant to public offer of 22,000 shares of

aims at a long term partnership with suppliers and

the Company held by Central Bank of India. Since

recognizes the mutuality of interest. The Bosch

then there has been significant participation by small

principle of Quality, Cost and Delivery equally applies

shareholders in the capital of the Company. The

to our suppliers.

equity shares of the Company were also listed in National Stock Exchange of India Ltd., Mumbai, from

Employees

the year 2003. The Company is committed to

Emphasis on enhancement of employee’s skill and

enhancing long term shareholder value and delivering

competence in the Company continued as in the

speedy and efficient services to the shareholders.

previous years. There has been significant

Buy back of shares carried out by the Company in

improvement in the deployment of and

May 2000, January 2001, February 2002 and

understanding of various employee development

December 2008 to October 2009; sub-division of

tools relating to Potential Identification, Career

shares in July 2004 are steps in this direction.

Planning, Assessment Centres and Competency based Training and Development.

Customers Customers are the primary focus of Company’s

Special emphasis was laid on development of

business activity. Quality, Cost and Delivery are the

Leadership capabilities at the Middle and Senior

key driving forces for achieving customer delight.

Management levels. Bosch’s long standing flagship

The BeQIK initiative gives impetus to the efforts of

“General Management” programme was brought to

the Company in achieving world-class quality,

India with a tie up with Indian Institute of

innovation and continuous improvement to enhance

Management, Bangalore. Senior Leadership

customer satisfaction.

Workshops and personalized Executive Coaching

40 | Report on Corporate Governance I Annual Report 2011

were other offerings made in the year. Company’s

concept of BMSI is highly innovative and is based on

focus on developing and encouraging young

successfully deployed model in Germany. Bosch

generation for the future leadership is evident from

Group recognizes the need to mobilize all available

the awards received by the teams from the Company

resources and knowledge to achieve greater operating

at the National Competition for Young Managers

and structural efficiency in order to react more quickly

(NCYM) conducted by All India Management

to market changes. BMSI provides platform to pool

Association (AIMA).

systematically, the expertise and knowledge of retired employees and seamlessly deploy their talent on the

Significant efforts and measures have been taken to

projects requiring their skills. Retired employees know

integrate more women in the organization and to

Bosch well; they are flexible and are available at short

create an inclusive environment for them. Launch of

notice; further they require no training and are

the Gender Diversity Global Communication

effective in short duration. BMSI leverages these

Initiative targeting the desired mindset change, is a

realities to add value to Bosch Group.

key step towards the same. BMSI has a pool of around 200 experts who support In our constant endeavors to make the Company a

Bosch Group of companies to execute projects

better place to work for, necessary changes have

involving strategic, operational and conceptual issues.

been incorporated in the existing HR policies, such

BMSI consultants through more than 200 assignments

as - revision of leave policy, revision of transfer

and 25,000+ consultancy days helped in resolving

policy, extension of retirement age, modification of

many critical problems in variety of functions.

service award. Attrition continues to be well below market levels due to the measures taken by the

BMSI offers win-win solution to the Company and

Company. The Company has the strength of 12,232

retired employees, and BMSI experts have played key

employees as at the close of the year 2011.

role in bridging capacity gaps at short notice. BMSI experts have significantly contributed in projects

The Company appraisal program system for

relating to leadership development, knowledge

managerial staff called as ‘Bosch Performance Review

management project management, market

and Employee Development (PRED)’ program has

establishment, quality improvement, cost

attained higher maturity level through continuous

optimization, supplier development and training.

communication and education through forums like Employee Development workshops etc. Introduction

Society

of Low Performance Monitoring policy was a key step

In keeping with Bosch philosophy, the Company’s

towards employee development and ensuring

priority is to combine the pursuit of economic

retention of the competence edge of the Company. A

objectives with consideration for social and

high level of global orientation and working experience

environmental factors.

is given to a large number of managers by deputing them on international assignments, participation in

The Company contributes to the society at large, more

international workshops/seminars/forums, identifying

particularly in areas proximate to its works and

and developing high potential managers through

establishments through contributions and

Management Development Programs (MDP)

infrastructural support to organizations who promote

conducted by Bosch. Achievement of “Significant

the cause of children, mentally and physically

Achievement Award” in HR-Excellence Assessment

challenged, orphans, education, fine arts, health care,

conducted by Confederation of Indian Industry (CII) is

sports, etc. The Company and the employees also

a major recognition for the Company at National level.

contribute for relief measures in times of natural calamity affecting sections of the society.

Bosch Management Services, India Bosch Management Services, India (BMSI) which

Social Responsibility

started functioning in 2010 has significantly

The assumption of responsibility for society and

strengthened its presence in the year 2011. The

future generations has a long tradition in the

Annual Report 2011

I

Report on Corporate Governance | 41

Company. Combining the pursuit of economic objectives with consideration for social and environmental factors is our priority. We accept that our actions must accord with the interests of society. Above all, we place our products and services in the interests of the safety of people, the economic use of resources, and environmental sustainability. To substantiate more on social responsibility of the Company, a report on ‘Corporate Social Responsibility’ is annexed to this Annual Report. Environment, Occupational Health & Safety, Water and Energy Conservation. Many initiatives were taken up by the Company in

‘Light Pipe’ day lighting system in central complex

2011 towards conservation of energy. The

canteen in Bangalore Plant.

optimization of heat treatment processes, change over to new energy-efficient cleaning machines,

Even though the Company is not a water intensive

introduction of turbo vent fans, change over to high

industry, utmost care has been taken for its

energy efficient air drier and water pumps and

judicious use. As a part of continuous improvement

harnessing solar energy have yielded good results.

process, objectives are taken up for water

The Company places its products and services in the

introduction of controls in processes have yielded

conservation. Up-gradation, automation and interest of the safety of people, the economic use of

substantial savings in the water consumption.

resources and environmental sustainability. The

Tertiary treatment processes, like reverse osmosis,

Bosch slogan "invented for life" is not only the

treat effluents which is reused in the process thereby

expression of a quality standard, but also an

saving precious fresh water. All our locations have

obligation for the Company to develop innovative and

“Zero Discharge” concept.

beneficial technology that contributes to the "Conservation of resources and minimizing impacts

Safety at our work places is given utmost importance.

on environment". The Company is continuously

The safety release of machines & equipments and

striving to seek and find technological answers to

hazard assessment of chemicals are carried out to

ecological questions.

ensure accident prevention. In case some residual risks are observed, associates are provided with

Towards the economical use of natural resources, the

required personal protective equipments. Also, safety

Company at its canteen in Bangalore Plant installed

is ensured through administrative controls like

day lighting system called “Light pipe” which has

operational control procedures, instructions, signages

replaced conventional lighting during day time hours.

etc., “Near miss” reporting and tracking system

This has enabled bringing in bright natural light to

established in our locations would greatly facilitate

the interiors. As a part of solar photovoltaic pilot

accident prevention.

project, solar power plants were commissioned at the Company locations in Bangalore and Jaipur. Each

We continuously strive for fire prevention. Installation

of these units is generating about 200 units per day.

of water mist fire protection system for furnaces,

All locations are striving hard to achieve CO2

installation of gas suppression systems for battery

emission reduction targets for the year 2012 and onwards.

banks in UPS facilities, early detection and gas suppression systems for fire prone machines,

42 | Report on Corporate Governance I Annual Report 2011

introduction of fire hydrant pump performance

The combined inner and outer circular shape

monitoring system which would detect water loss/

emphasizes the interaction between rules and

leakage in the hydrant line are some of the key

one’s own responsibility.

initiatives which would ensure prevention of fire. Plant locations have implemented “Integrated

Greenery at Bosch

Management System” (combined system in line with ISO 14001 & OHSAS 18001 requirements). The system would ensure i) taking up objectives to minimize impacts on the environment and risk reduction; ii) supports in realizing such objectives through participation of all concerned; iii) checks the effectiveness of the system through audits by qualified auditors and iv) helps the Plant management in frequent reviews. Greenery at Jaipur Plant maintained by treated water Bosch Environment Logo

Government The Government as a stakeholder earns revenue through income tax, service tax, customs duty, sales tax, excise duty, etc. These contributions to the exchequer was `11,346 million in 2009, `16,895 million in the year 2010 and `20,696 million in the year 2011, excluding tax deducted

“Blue” stands for clean water and clean air, and for objectives to minimize adverse impacts on the environment. The “Green leaf” represents the link to nature and the careful use of resources, as well as the continuous improvement of operational processes serving to protect nature. The circular shape symbolises nature’s cycles, and

at source on salaries paid to employees, payments to contractors and to other service providers. Risk Management The Company has evolved a framework for systematic management of Business Risks. Towards this the Company has identified risk categories under strategic risks, operative risks,

our responsibility during the development and

information technology risks, financial risks and

manufacture of products, up until their disposal at

global risks to which this framework is applied.

the end of the life cycle.

This system of risk management is audited

The shape of a “Q” - the RB symbol for Quality -

regularly by the Company's Internal Audit Team.

emphasizes that environmental protection is a feature of quality.

Values

Bosch Safety Logo

has always been a value driven Company. Many of

The Company as a constituent of the Bosch Group these values go back to Robert Bosch, the founder. Other values have evolved over time. These values have been codified to ensure uniform and common understanding and systematic implementation across all Bosch locations and The round shape symbolises the employee in the

units worldwide.

centre being protected. The division into two parts signifies that there are rules and one’s own responsibility.

Employees who know the values of the Company, who have internalized them and who live according

Annual Report 2011

to them gain confidence and orientation for their daily

I

Report on Corporate Governance | 43

that cross departmental boundaries. Utilizing

work. This helps the employees to take better and

this potential systematically across all business

faster decisions, to develop greater initiative and to

sectors and regions of the world will enhance

take on greater accountability for their own actions.

our competitiveness.

In the end this gives them greater empowerment and makes the Company better.

u The Bosch Business System promotes the

continuous improvement of all Companyinternal processes and their practical

These values are: 1.

Future and Result Focus

2.

Responsibility

3.

Initiative and Determination

4.

Openness and Trust

5.

Fairness

6.

Reliability, Credibility and Legality

7.

Cultural Diversity

implementation. The ‘House of Orientation’ helps all associates of the Bosch Group to better understand the changes in the Company, to play their part in shaping those changes, and in this way to ensure our long-term competitiveness. Bosch Business System (BBS) BBS comprises following sub systems: u The Bosch Product Engineering System (BES)

focuses on product creation and related Understanding and living the corporate culture

activities. Best-practice processes and qualified

The ‘House of Orientation’ sets out how we see our

associates allow us to attain excellence in

future development, the principles of our approach,

product creation and best-in-class products.

and the capabilities that we have and want to

u The Bosch Production System (BPS) is a

exploit for our continued success in the future. It

systematic approach to adjusting and

also contains information on the standards and

restructuring value creating processes up to

values that motivate us in our daily striving for

delivery to our customers. The focus of BPS is

success and improvement. ‘House of Orientation’

on the avoidance of waste in production and

will help all associates to understand and live our

its contributory business processes.

corporate culture – a culture that offers orientation, reinforces cohesiveness, and creates identification.

u The Bosch Sales and Marketing System (BSS)

starts from the requirements made of Sales and Marketing by the market. The defined goal of

‘The House of Orientation’ comprises the following modules: u The vision is the overriding ideal for the

Company’s future. It points the way forward

BSS is to achieve “sales excellence”. u Bosch Human Resources System (BHS),

a management and support system, is the global change initiative in Human Resources. It provides both a framework and direction for

for a strong and meaningful development of

strategic and operational HR work. Its goal is

the Bosch Group.

to achieve systematic control and optimization

u As a guideline for everyday action, the mission

of HR processes and organization worldwide.

gives concrete guidance on how to secure long-term profit and growth. u Our values create a common basis for

successful global co-operation. This vital Bosch culture enables the Company to continue to evolve in an international market environment. u The Bosch Group has clear core competencies

Board of Directors, Board Meetings, etc. The composition of the Board of Directors of the Company is governed by the provisions of The Companies Act, 1956, the Articles of Association of the Company and the Listing Agreement with the Stock Exchanges. The Board is comprised of eight Directors, both executive and non-executive and one Alternate

44 | Report on Corporate Governance I Annual Report 2011

Director. Dr. A. Hieronimus is the non-executive Chairman. Mr. B. Steinruecke, Mr. B. Muthuraman, Mrs. Renu S Karnad and Mr. Prasad Chandran are the independent directors who constitute fifty percent (50%) of the total strength of the Board. Mr. Soumitra Bhattacharya is the Alternate Director to Dr. B. Bohr.

*

Excludes directorship in private companies, membership of associations/ trusts etc.

**

includes only Audit and Shareholders’/Investors’ Grievance Committees

#

Also Executive Director & CFO of the Company.

@

Including Directorship in one Foreign Body Corporate

@@

Including Directorship in two Foreign Body Corporates

@@@

Including Directorship in five Foreign Body Corporates

@@@@

Including Directorship in two Foreign Body Corporates.

@@@@@ Including Directorship in three Foreign Body Corporates

The Directors of the Company are persons of eminence having vast and varied experience in manufacturing, marketing, sales, banking, financial and business administration. The Board of Directors meet as often as required but not less than four times a year and once in a calendar quarter. Agenda/Board papers are made available to the Board of Directors well in advance to enable the Board to discharge its responsibilities effectively. The Board of Directors of the Company receive a copy of minutes of all Committee meetings namely Audit Committee, Shareholders’/Investors’ Grievance Committee, Remuneration Committee and Property Committee. Five Board meetings were held during the year 2011 and the gap between the two meetings did not exceed four months. The dates on which the Board meetings were held are: 28th February, 18th May, 1st June, 30th August, and 9th December.

++

including three pvt. subsidiaries which are the subsidiaries of a public limited company.

+++

including one pvt. subsidiary which is the subsidiary of a public limited company.

The Non Whole-time Directors do not hold any shares in the Company. Dr. Hieronimus, Chairman, holds 640 shares in the Company. Directors furnish Notice of Disclosure of Interest as specified in Section 299(1) of The Companies Act, 1956. The Company maintains Register of Contracts, Companies and Firms in which Directors are interested as provided under Section 301(1) of The Companies Act, 1956. Audit Committee During the year 2011, the Audit Committee met on 28th February, 27th April, 1st June, 5th August, 30th

Particulars of the directorship of Board, membership and office of the Chairman of Board Committees across all companies (as on 31.12.11) and attendance at the Board Meetings of the Company are given below. Name of the Director

Dr. A. Hieronimus Chairman Non-Executive Director Dr. B. Bohr Non-Executive Director Mr. B. Steinruecke Independent NonExecutive Director Mr. B. Muthuraman Independent NonExecutive Director

Directorships held *

Membership Chairman/ of Board Chairperson Committees of Board ** Committees **

Board meetings attended in 2011

August and 8th November. The constitution and particulars of meetings attended by members of the Committee are given below. Name of the Director

attended Mrs. Renu S Karnad Chairperson – Independent Director

[email protected] [email protected]@

3 -

1 -

No. of meetings

5

4

Mr. B. Steinruecke

2

Independent Director

4

Independent Director

5

Mr. B. Muthuraman 5

4

1

3

Mr. Prasad Chandran [email protected]@@

2

-

3

Independent Director Non-Executive Director

Mrs. Renu S Karnad Independent NonExecutive Director

[email protected]@@@++

2

3

4

Mr. Prasad Chandran Independent NonExecutive Director

[email protected]@@@@

3

-

4

Mr. V.K. Viswanathan Managing Director

6+++

2

1

5

Dr. Manfred Duernholz Joint Managing Director

2+++

-

-

5

Mr. Soumitra Bhattacharya, Alternate Director for Dr. B. Bohr.

1#

-

-

2

6

Dr. A. Hieronimus 3

The terms of reference of the Audit Committee as per guidelines set out in the Listing Agreement with the stock exchanges read with Section 292A of The Companies Act, 1956 is set out below: 1. Chairman: Chairman of the Audit Committee shall be an Independent Director.

Annual Report 2011

4. Frequency of meetings: The Audit Committee shall meet at least four times in a year and not more than four months shall elapse between two meetings. 5. Quorum: The quorum shall be either two members or onethird of the members of the Audit Committee, whichever is higher but there shall be a minimum of two independent members present. 6. Powers: The Audit Committee shall have powers which shall include the following:

u Any changes in accounting policies and

practices and reasons for the same. u Major accounting entries involving estimates

based on exercise of judgment by management. u Qualifications in draft audit report. u Significant adjustments made in the financial

statements arising out of audit findings. u Compliance with listing and other legal

requirements relating to financial statements. u Disclosure of any related party transactions.

e.

Review with the management, performance of the statutory and internal auditors, adequacy of internal control systems.

f.

Review with the management the quarterly financial statements before submission to the Board for approval.

g.

Review the adequacy of internal audit function including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure, coverage and frequency of internal audit.

h.

Discuss with the internal auditors any significant findings and follow up thereon.

i.

Review the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the Board.

j.

Discuss with the statutory auditors before the audit commences about the nature and scope of audit as well as hold post-audit discussions to ascertain any area of concern.

k.

Look into the reasons for substantial defaults, if any, in the payment to the depositors, debenture holders, shareholders (in case of non-payment of declared dividends) and creditors.

l.

To review the functioning of the whistle blower mechanism, if any.

(a) to investigate any activity within its terms of reference (b) to seek information from any employee (c) to obtain outside legal and other professional advice (d) to secure attendance of outsiders with relevant expertise, as the Committee considers necessary. 7. Role: The role of the Audit Committee shall include the following: a.

Oversight of the Company’s financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible.

b.

Recommend to the Board the appointment, reappointment and replacement/removal of the statutory auditor and the fixation of audit fee.

c.

Approval of payment to the statutory auditors for any other services rendered by them.

d.

Review with the management the annual financial statements before submission to the Board for approval with particular reference to: u Matters required to be included in the

Directors’ Responsibility Statement to be included in Board’s Report in terms of Clause 2AA of Section 217 of the

Report on Corporate Governance | 45

Companies Act, 1956.

2. Invitees: The Audit Committee may invite such executives of the Company as it considers appropriate (and particularly the head of the finance function) to be present at the meetings of the Committee, but on occasions it may also meet without the presence of any of the executives of the Company. The Managing Director, Head of Internal Audit and a representative of the statutory auditor may be present as invitees for the meetings of the Audit Committee. 3. Secretary: The Company Secretary shall act as Secretary of the Audit Committee.

I

8. Review of information: The Audit Committee shall review the following information: (i)

Management discussion and analysis of financial condition and results of operations;

(ii) Statement of significant related party transactions (as defined by the audit committee), submitted by management; (iii) Management letters/letters of internal control weaknesses issued by the statutory auditors; (iv) Internal audit reports relating to internal control weaknesses; and (v) The appointment, removal and terms of remuneration of the Chief Internal Auditor.

46 | Report on Corporate Governance I Annual Report 2011

Share Transfer Committee Mr. B. Steinruecke, Mr. B. Muthuraman, Mr. Prasad Chandran and Mr. V.K. Viswanathan constitute the Share Transfer Committee. To facilitate prompt services to the shareholders, the Company Secretary is authorized to approve transfer, transmission, consolidation, sub-division of shares and issue of duplicate share certificates not exceeding 500 shares per folio per occasion. These are processed every fortnight. Shareholders’/Investors’ Grievance Committee During the year 2011, the Committee met on 28th February, 1st June, 30th August, and 9th December. The constitution and particulars of meetings attended by members of the Committee are given below. Name of the Director

No. of meetings attended

Mr. B. Steinruecke Chairman, Independent Director

3

Mrs. Renu S Karnad Independent Director

3

Mr. Prasad Chandran Independent Director

3

Dr. A. Hieronimus Non-Executive Director

4

Mr. V. K. Viswanathan Managing Director

4

The Committee reviews grievances received from the shareholders/investors and action taken thereon. Three complaints were received and resolved during the year under report. The Company did not receive any complaints from stock exchanges, investors’ association and from The Securities and Exchange Board of India (SEBI). There were no complaints lying unresolved at the end of the year. General Meetings The Annual General Meeting of the Company will be held at Bangalore in May/June each year. During the years 2009, 2010 and 2011, Annual General Meetings were held on 28th May, 3rd June and 1st June, respectively. Dr. A. Hieronimus, Dr. B. Bohr, Mr. B. Steinruecke, Mr. Muthuraman, Mrs. Renu S Karnad, Mr. Prasad Chandran, Mr. V.K. Viswanathan and Dr. Manfred Duernholz attended the last Annual General Meeting held on 1st June 2011.

Insider Trading and Code of Conduct for Directors and Senior Management Pursuant to the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992, the Company has prescribed a Code of Conduct for Prevention of Insider Trading and a Code of Corporate Disclosure Practices. The Company observes a closed period for trading in securities of the Company by the Directors/Officers and Designated Employees of the Company for a period of seven days prior to the close of the quarter/half year/year and up to 24 hours after the date on which the results for the respective quarter/half year/year and is notified to the stock exchanges. The Certificate by the CEO of the Company concerning compliance with the Code of Conduct for Directors and Senior Management is given below:

This is to confirm that: the Company has obtained from the Directors and Senior Management personnel affirmation that they have complied with the Code of Conduct for Directors and Senior Management for and in respect of the year 2011. V.K.Viswanathan Managing Director

Place: Bangalore Date: 10.02.2012

CEO/CFO Certificate A certificate from the Chief Executive Officer (Managing Director) and the Chief Financial Officer dated 10.02.2012 on the financial statements and other matters of the Company for the financial year ended 31st December 2011, was placed before the Board at its meeting held on 28.02.2012. Subsidiary Company The Company does not have any material non-listed Indian subsidiary. The Company’s only subsidiary MICO Trading Pvt., Ltd., has not commenced its business yet. As the aggregate assets and income of the said subsidiary as on 31st December 2011 is not material, no consolidated financial statements has been prepared. However, the Annual Report of the subsidiary company is forming part of this Annual Report. The minutes of the Board meetings of the said subsidiary for each quarter were considered and taken on record by the Board of Directors of the Company at its Board Meetings held every quarter.

Annual Report 2011

Mandatory/Non-mandatory requirements

I

Report on Corporate Governance | 47

is valid up to 31.12.12. The term of Dr. Manfred

The Company has complied with the requirements

Duernholz, Joint Managing Director, which was valid

relating to Corporate Governance as mandated by

up to 31.12.11, has been extended for a further

the Listing Agreements with The Bombay Stock

period of one year from 01.01.2012 to 31.12.2012 at

Exchange Limited and The National Stock Exchange

the Board Meeting held on 30.08.11 subject to the

of India Limited. The Company has the Remuneration

approval of members at the Annual General Meeting

Committee comprising Non-executive and

to be held on 04.06.2012. Dr. Duernholz joined the

Independent Directors. The Company has adopted

Execuitve Management of the Company on

Whistleblower Policy.

01.02.2008 as Joint Managing Director responsible for

Remuneration Committee/Remuneration of Directors and particulars of appointment / re-appointment of Directors. In September 1993, the Board of Directors set up a Remuneration Committee to decide the compensation payable to the Executive Directors. Mr. B. Muthuraman, Mr. B. Steinruecke and Mr. Prasad Chandran being Independent Directors and Dr. A. Hieronimus constitute/d the Remuneration Committee. During the year 2011, the Committee met on 28th February and 1st June. Dr. Hieronimus, Mr. B. Steinruecke and Mr. Prasad Chandran attended the meeting held on 28.02.11. Dr. Hieronimus, Mr. B. Steinruecke, Mr. B. Muthuraman and Mr. Prasad Chandran attended the meeting held 01.06.11. The remuneration payable to the Executive Directors is approved by the shareholders at the general meeting of the Company. Remuneration of Executive Directors consists of a fixed salary and a variable bonus taking into account the economic results and individual performance. The Board of Directors determine the variable bonus from year to year. It can amount up to 180% of the base salary for Mr. V.K. Viswanathan, Dr. Manfred Duernholz and for Mr. Soumitra Bhattacharya. The payment of the annual bonus is made in one/two installment/s at the end of April or June of the following year. In addition, Executive Directors receive benefits such as company owned / leased house, services of security and garden maintenance, company car and driver, telephone at home, club membership and reimbursement of joining time expenses and similarly on their return. Mr. V. K. Viswanathan and Mr. Soumitra Bhattacharya also receive reimbursement of medical expenses, personal accident insurance cover and contribution to provident fund, gratuity and superannuation etc. The term of Mr. V.K. Viswanathan, Managing Director,

powertrain business. Dr. Duernholz, 57, holds Diploma in Engineering and a graduate degree in Machine building from the Technical University of Aachen, Germany. He is also a doctorate in Engineering. He held varied technical position from 1974 to 1999 before joining the Bosch group in April 1999. He does not hold any shares in the Company. The Board of Directors appointed Mr. Soumitra Bhattacharya, Executive Vice President of the Company as Alternate Director to Dr. Bohr with effect from 01.07.2011 at their meeting held on 01.06.2011. The Board also approved the terms of his appointment for a period of 5 years from 01.07.11 to 30.06.2016 and the remuneration at its meeting held on 30.08.2011 subject to the approval of members at the Annual General Meeting to be held on 04.06.2012. Mr. Bhattacharya, 51, Graduate in Commerce and a Chartered Accountant, articled from M/s Price Waterhouse & Co., has over 28 years of professional experience. He joined the Company in April 1995 as Deputy General Manager responsible for corporate planning and controlling. He is currently the Executive Director & CFO responsible for all commercial functions of the Company. During his past assignments, he served as Commercial Director of Robert Bosch, Turkey. Prior to this he served as Vice President responsible for the commercial and administrative functions for the Company’s Nashik and Jaipur Plants. During 1998 & 1999 he worked in Stuttgart, Germany, on deputation to Robert Bosch GmbH as General Manager in Feuerbach Plant. He is the Chairman of the Consumer Affairs Committee of ACMA and Vice Chairman of CII, Karnataka. He does not hold any shares in the Company. The contract of employment of executive directors is terminable by observing a period of notice of twelve months to expire at the end of a calendar quarter.

48 | Report on Corporate Governance I Annual Report 2011

Details of remuneration paid to Whole-time

Code of Conduct and Whistle Blower Policy

Directors are given below.

The Company has adopted a Code of Conduct for the Directors and Senior Management personnel. The code can be accessed in the Company’s website at www.boschindia.com. The code also incorporates a Whistle Blower Policy. The whistle blower policy as well as the Code of Business Conduct afford to all the employees a right to draw their supervisor’s attention to circumstances that appear to indicate a violation of code of business conduct. Such reporting may also be made anonymously or by speaking to the compliance officer over dedicated hotline or by email to the dedicated email address to the compliance officer.

Particulars

Mr. V. K. Viswanathan Managing Director

Dr. Manfred Duernholz Joint Managing Director

Mr. Soumitra Bhattacharya Executive Director & CFO (w.e.f 01.07.11)

Amount (`)

Amount (`)

Amount (`)

Salary

13,500,000

16,241,596

3,048,498

Commission/ Bonus

16,722,000

15,578,812

2,264,304

3,375,000

988,260

483,000

Contribution to Provident & other funds Other perquisites (incl. book depreciation on assets used by the Directors) Total

1,553,444

1,240,693

157,971

35,150,444

34,049,361

5,953,773

The Board of Directors decides the remuneration of the Non Whole-time Directors. The remuneration consists of a sitting fee of `10,000 for Board/Committee Meetings held on the same day and `5,000 for each Committee Meeting held on any other day and a commission based on the profits of the Company, limited to an amount not exceeding `60,00,000 for all Non Whole-time Directors for or in respect of any one financial year of the Company. The amount of commission is commensurate with

Reconciliation of share capital In the year 2011, an audit was carried out at the end of every quarter by a qualified Practicing Company Secretary for reconciling the total admitted capital with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDS) and the total issued and listed capital. The audit confirms that the total issued/paid up capital is in agreement with the total number of shares held in physical form and the total number of dematerialized shares held with NSDL and CDS. The report for every quarter upon reconciliation of capital was submitted to the stock exchanges, NSDL and CDS and was also placed before the Board of Directors at their meetings.

the activities of the Company, the responsibilities of

Disclosures

Non Whole-time/Independent Directors under the

(i)

listing agreement with the stock exchanges and under the Companies Act, 1956, and the responsibilities as member/chairman of the Board and member/chairman of committee/s of Board and all other relevant factors. Details of remuneration paid to Non Whole-time Directors for 2011 is given below. Particulars

Commission `

Sitting Fee `

Total `

Dr. A. Hieronimus

835,000

50,000

885,000

Mr. B. Steinruecke

675,000

55,000

730,000

Mr. B. Muthuraman

615,000

40,000

655,000

Mrs. Renu S Karnad

725,000

50,000

775,000

Mr. Prasad Chandran

675,000

55,000

730,000

There are no materially significant transactions with the related party viz., Promoters, Directors or the Management, their subsidiaries or relatives that may have potential conflict with the interest of the Company at large.

(ii) There are no pecuniary relationships or transactions with Non-Executive Directors of the Company except the remuneration paid to them for services rendered as Directors of the Company. (iii) The Company has complied with the requirements of the Stock Exchanges, SEBI and other statutory authorities. No penalties or strictures were imposed on the Company by the Stock Exchanges, SEBI or any statutory authorities on any matter relating to capital markets.

Annual Report 2011

Communication to shareholders Quarterly/half yearly/annual results and information relating to convening of Annual General Meetings and Extraordinary General Meetings are published in leading newspapers (viz: Business Line, English-all editions and Udayavani, Kannada) and/or hosted on the website of the Company and also notified to the stock exchanges as required under the Listing Agreement. The balance sheet, profit & loss account, directors’ report, auditors’ report, cash flow statements, corporate governance report and quarterly/half yearly financial statements can be viewed by the shareholders and investors from the Company’s website at http://www.boschindia.com under the section ‘Shareholder Information’. The quarterly and half yearly financial statements, shareholding pattern, etc. can be retrieved by the shareholders and investors from Corporate Filing and Dissemination System (CFDS) put in place

I

Report on Corporate Governance | 49

jointly by BSE and NSE at the URL www.corpfiling.co.in. The Executive Management of the Company participated in the Conference call organized by financial intermediaries, post publication of audited/ unaudited, quarterly/ half yearly/ annual financial results of the Company. Company sends notices relating to Annual General Meetings, Extraordinary General Meetings, Postal Ballot, disclosure of Directors’ interest in respect of contracts appointing Managing / Joint Managing Director/s etc., to the members at their registered address. Shareholder information A detailed supplement containing information of importance to shareholders is given in this Annual Report. Bangalore February 28, 2012

50 | Report on Corporate Governance I Annual Report 2011

Certificate on compliance with the conditions of Corporate Governance under Clause 49 of the Listing Agreement

To Members Bosch limited Hosur Road, Adugodi Bangalore 560 030 We have examined all relevant records of Bosch

conducted the affairs of the Company.

Limited (the Company) for the purpose of certifying compliance of the conditions of Corporate

On the basis of our examination of the records

Governance under clause 49 of the listing agreement

produced, explanations and information furnished,

with Bombay Stock Exchange Limited (BSE) and

we certify that the Company has complied with all

National Stock Exchange of India Ltd., (NSE) for the

the mandatory conditions of the said clause 49 of the

st

st

period from 1 January 2011 to 31 December 2011.

listing agreement.

We have obtained all information and explanation which to the best of our knowledge and belief were

We further state that it is neither an audit nor an

necessary for the purpose of the certification.

expression of opinion on the financial statement of the Company.

The compliance of the conditions of Corporate

For K.V. Venkata Rangan & Co.,

Governance is the responsibility of the Management.

Company Secretaries

Our examination was limited to the procedures and implementation thereof adopted by the Company

K V Venkata Rangan

for ensuring the compliance of conditions of

Practicing Company Secretary

Corporate Governance as stipulated in the said

Membership No.934; CP No.404

clause. This certificate is neither an assurance as to

Place: Bangalore

the future viability of the Company nor the

Date: February 28, 2012

effectiveness with which the management has

Annual Report 2011

I

Management Discussion and Analysis Report | 51

Management Discussion and Analysis Report

A. Economic Overview Global growth prospects dimmed and risks sharply escalated during the fourth quarter of 2011, as the euro zone crisis entered a perilous new phase. The global economy growth for 2010 and 2011 was 5.2% and 3.8% respectively. Forecasted growth for 2012 and 2013 is

35% respectively in 2011 in comparison with 2010. The growth in HCV segment for the first and second half of 2011 was 14% and 11% respectively in comparison with 2010. Growth in the Passenger Cars and Utility Vehicle segment

3.3% and 3.9% respectively. Growth in emerging and

was 22% in the first half of 2011 and a negative growth of

developing economies is also expected to be slow due

3% in the second half of 2011 compared to 2010. The

to worsening external environment and a weakening of

widening price differential between petrol and diesel had

internal demand. The emerging and developing

distorted the demand in this segment with Diesel share in

economies growth for 2010 and 2011 was 7.3% and

Passenger cars and Utility Vehicles increasing to 37% in

6.2% respectively. Forecasted growth for 2012 and 2013

2011 against 30% in 2010.

is 5.4% and 5.9% respectively. (Source: IMF)

The Tractor segment continued to grow steadily with

Growth in India is moderating more than was

a 24% growth over 2010 backed by bumper

expected earlier. The baseline projection of GDP

agricultural produce registering 27% and 22%

growth for 2011-12 has been downward revised to

growths in first half & second half respectively.

6.9% on the basis of the macro-economic situation prevailing. It is likely to be below potential during 2011-12, but is expected to recover at a modest pace in 2012-13. The slack in investment due to

The growth in the 3 wheeler segment for first half and second half were 22% and 10% respectively in the current year 2011 in comparison with previous year 2010.

delay in implementation of key policies and reforms

The table below depicts the extent of growth in 2011

may keep the pace of recovery low. Inflation has

across various sectors in automotive segments.

started to fall, broadly in line with the projected

Vehicle production growth rates:

trajectory. Nonetheless, price pressures remain, with risks emanating from suppressed domestic energy prices, the rupee depreciated over 16% in 2011,

+/(-) PY Segments

2007

2008

2009

2010

2011

accelerating prices of imported goods & services and

HCV

4%

-15%

-20%

70%

13%

slippage in fiscal deficit. (Source: RBI)

LCV

20%

-4%

13%

44%

30%

Inflation, rupee depreciation, high commodity prices

Cars

16%

9%

18%

29%

8%

and hardening interest rates remain key challenges

UV’s

17%

-3%

18%

35%

13%

Tractors

-1%

2%

10%

31%

24%

3 Wheelers

-1%

-6%

12%

37%

15%

Total

10%

1%

13%

34%

14%

needing focused attention. B.

Industry Structure and Development

The automotive market was buoyant in the first half of the year 2011, continuing the growth saga of previous year 2010. In second half there was a decline in growth due to poor market sentiments, high fuel prices and high inflation leading to costlier loans. Indian Automotive Industry witnessed an overall growth of 14% in 2011 over and above the high growth achieved in 2010. The first half of 2011 witnessed a healthy growth of 22% and the second half witnessed reduction in growth to 6%. Across segments, LCV leads the pack by growing strongly at 30% in the year 2011 driven by retail sector growth and robust demand for sub 3.5tonne LCVs. Growth rate for first half and second half was 26% and

C. Operational Highlights The Company witnessed a good growth of 19.6% YoY in sales for the current year 2011. This is over and above the phenomenal growth in sales achieved in 2010. The profit before tax for the year grew by 30.9% YoY. The Company was able to achieve an increase of 170 basis points in terms of profit before tax percentage and stood at 19.8%, in-spite of challenging environment. The Automotive Aftermarket business has registered a double digit growth for the sixth consecutive year. It grew by 15.2%. The growth was driven primarily by domestic spare market. Diesel system business grew by 19.2%. The Diesel Systems business continued to drive focused

52 | Management Discussion and Analysis Report I Annual Report 2011

innovation on the value line CRS (for Light Commercial Vehicles) and the simplification of the CRS1-14 (for small engines). This was achieved through capacity expansion at Nashik and Bangalore Plant. Starter Motor and Generator business witnessed a growth of 63.1% over previous year. The robust growth primarily driven by New Base Line Generator both in domestic and export market. Packaging Technology system business grew by 40.0%. The growth was driven primarily by demand from a single largest export order. All machines were delivered in time through process improvements at the division. Security Technology business grew by 18.4%. New projects received by the division in 2011 contributed for growth. Power Tools business registered a growth of 22.0% with high contributions from its major business segments like Power Tools, Accessories, Spares, Fischer Fixings, etc. Power Tools business also increased its market share in a competitive environment and received '5 Diamond Award' for consecutive years of double digit growth at the Bosch Power Tools World Convention (WoCo) 2012 in Germany.

The share of automotive products has marginally decreased from 91% in the previous year 2010 to 90% for the year 2011.

100%

10%

10%

11%

9%

10%

90%

90%

89%

91%

90%

80% 60% 40% 20% 0% 2007

2008

2009

Automotive

2010

2011

Others

1.2 Automotive Products The automotive segment saw a robust growth in sales by 19.1% and stood at TINR 71,566,292 for the current year 2011.

100%

17%

17%

13%

83%

83%

87%

14%

14%

80% 60%

Power Tools business launched over 100 new innovative products / variants and launched its new initiative called ‘I&I’ (Industrial & Institutional) supported by new marketing initiatives. The year also saw the launch of new range of Measuring Tools & Surveying Equipment under the brand name of "CST/berger"

D. Results of operation 1.

Sales

The sales for the year 2011 grew at the rate of 19.6% YoY and stood at TINR 79,294,704 as against sales of TINR 66,305,034 in the previous year 2010. 1.1 Segment results The Company predominantly operates in manufacturing and trading of automotive products and also manufactures non-automotive products (Consisting - Industrial Technology and Consumer goods & Building Technology). Hence the operations of the company can be classified as Automotive and Other segments (Primary Segment).

86%

20% 0% 2007

2008

2009

Domestic

New Division “Solar Energy” and “Thermo Technology” launched their Product and Services in 2011.

86%

40%

2010

2011

Export

In the automotive segment 86.1% of the sales were derived from domestic sales. The share of export sales in the total sales of the segment has marginally gone up to 13.9% for the current year 2011 from 13.8% of previous year 2010. 1.3 Others The other segment (Consisting - Industrial Technology and Consumer Goods & Building Technology) saw a healthy growth of 24.2% in sales and stood at TINR 7,728,412 as against TINR 6,222,023 of the previous year 2010. Within the other segment, the Industrial Technology business grew by 45.5% YoY and Consumer Goods and Building Technology business grew by 21.3% YoY.

Annual Report 2011

I

Management Discussion and Analysis Report | 53

The other (Non-Automotive) segment is

677,136 in the current year 2011 from TINR 512,449

predominantly driven by domestic sales and

of previous year 2010. This growth is on account of

accounts for 95.1% of the total sales of the

higher development receipt from third parties and

segment. The export sales for other segment

rate revision with parent company for development.

increased from 2.4% in the previous year 2010 to 4.9% in the current year 2011.

The other income has increased by 3.0% YoY to TINR 2,977,884 in the current year 2011 from TINR

100%

1%

2%

4%

2%

5%

account of sale of long term investments which is partially set off with lower provision reversal of

80% 60%

2,892,518 of previous year 2010. The increase is on

earlier years in 2011 in comparison with 2010. 99%

98%

96%

98%

95%

40%

3. Cost of materials consumed The percentage of cost of material consumed as

20%

against sales for the year 2011 has gone up by 177

0% 2007

2008

2009

Domestic

2010

2011

basis points to 56.0% as against 54.3% of the previous year 2010. The increase in percentage is mainly due to

Export

depreciation in rupee and increasing input prices Below is the breakup of export and domestic sales

during the year basically on steel, alloys and other

(Secondary Segment).

materials. 4. Personnel cost

100%

16%

12%

15%

13%

13%

Personnel cost as a percentage of sales for the year 2011 stood at 11.3%, which has come down by 80

80%

basis points in comparison to 12.1% of previous year

60% 84%

85%

88%

87%

87%

2010. Sales per employee have improved by 12.9%

40%

from TINR 5,836 in the previous year 2010 to TINR

20%

6,588 for the current year 2011.

0% 2007

2008

2009

Domestic

2010

2011

Export

The export sales for the Company grew at a healthy rate of 22.3% YoY and improved its share in overall revenue by 0.2% and stood at 13.0% for the current year 2011. The domestic sales also recorded a growth of 19.2%. 2. Interest and Other Income For the year the income from interest on non-trade investments and deposits in banks has increased by 61.0% to TINR 1,842,460 from TINR 1,144,279 of previous year 2010. The increase in interest income is due to higher interest rates in FD which prevailed during the year and higher ICD. Income from services increased by 32.1% to TINR

5. Depreciation The depreciation charge for the current year is marginally higher at TINR 2,578,404 as against a charge of TINR 2,539,651 of previous year 2010 due to additional capital investment during 2011. 6. Profit The profit after tax for the year 2011 is TINR 11,225,584 as compared to a profit after tax of TINR 8,589,050 of the previous year 2010, an impressive increase of 30.7% YoY. The effective tax percentage for the current year 2011 has gone up slightly compared to previous year 2010. The tax benefit on sale of marketable securities partially offset with Nashik EOU debonding and lower R&D claims.

54 | Management Discussion and Analysis Report I Annual Report 2011

7. Earnings per Share (EPS) The EPS (Basic and Diluted) of the Company for the year 2011 has increased impressively by 30.7% to a

70,000

12.00%

60,000

10.00%

50,000

record INR 358 per share from INR 274 per share in

40,000

the previous year 2010.

30,000

8.00% 6.00% 4.00%

20,000

2.00%

10,000 358

2011

0.00% 2007

274

2010

2008

2009

2010

Capex (In Lakhs INR)

2011

Capex/Sales (%)

187

2009

In 2010 Company had 4.6% of its sales invested in

2008

198

2007

190 0

100

facilities. In 2011 the investment has been scaled up and 8.3% of sales have been invested in various 200

300

400

facilities across India. The Plant wise capital expenditure for the year 2010

The EPS for the Company has been growing

is as follows:

consistently at a healthy rate over the years except for a small reduction during the slowdown period of 2009.

2%

E. Financial Condition 1. Share Capital

33%

The Company has only one class of share equity

Jaipur Naganathapura

share, with a face value of INR 10 each. Authorized share capital is TINR 380,515 divided into

Bangalore

Nashik

50%

Verna-Goa

38,051,460 shares of INR 10 each. Issued, subscribed and fully paid-up capital as at December

11%

31, 2011 was TINR 313,989.

4%

2. Reserves and Surplus - Profit and Loss account The balance retained in profit and loss account as at December 31, 2011 is TINR 7,972,765 which includes retained profit for the year 2011 TINR 1,303,936 after a proposed dividend of INR 50 per share. 3. Shareholders funds The total shareholder’s funds increased to TINR 47,284,350 as at December 31, 2011 from TINR 40,980,414 as of the previous year 2010 end representing

5. Investments The surplus funds of the Company which are not required for immediate use are invested mainly in tax effective and low risk bearing instruments. The total investment as at December 31, 2011 amounted to TINR 16,063,646 as against TINR 16,073,030 for the previous year 2010. 6. Working Capital

a growth of 15.4%, mainly because of retained profits.

6.1 Inventories

4. Fixed Assets – Capital Expenditure

Inventory as at December 31, 2011 amounted to TINR 11,830,574 as against TINR 8,092,812 of previous year 2010. The inventory turnover ratio has increased to 46 days as at December 31, 2011 from 37 days of previous year 2010. The increase in inventory is mainly due to change in product mix (increase in sales of new generation products having higher import content) and also due to increase in sales of imported trade goods having high lead time.

The gross fixed assets as at December 31, 2011 was TINR 34,301,409 as compared to TINR 30,237,959 of previous year 2010. The Company has incurred a capital expenditure of TINR 6,587,236 during the year 2011, an increase of 118.0% YoY. The following graph shows the trend of capital expenditure and the trend of percentage of capital expenditure to sales.

Annual Report 2011

6.2 Sundry Debtors

I

Management Discussion and Analysis Report | 55

create an inclusive environment for them.

Sundry Debtors as at December 31, 2011 amounted to TINR 9,492,112 as against TINR 7,209,659 of previous year 2010. The debtors turnover ratio has increased to 38 days as at December 31, 2011 from 36 days of previous year 2010. Increase in debtors is mainly on account of tightened credit term in the market due to increase in interest rates, higher sales to OE segments where the change in credit term is between 45 to 60 days. 6.3 Cash and Cash Equivalents Majority of the cash balance is held in the short term deposits with scheduled banks. The total balance of cash and cash equivalents as at December 31, 2011 was TINR 9,514,538 as compared to TINR 13,258,674 for the previous year 2010.

In constant endeavors to make the Company a better place to work for, necessary changes have been incorporated in the existing HR policies. Attrition continues to be well below market levels due to the measures taken by the Company. The Company has the strength of 12,232 employees as at the close of the year 2011. Introduction of Low Performance Monitoring policy was a key step towards employee development and ensuring retention of the competence edge of the Company. Achievement of “Significant Achievement Award” for the Company in HR-Excellence Assessment conducted by Confederation of Indian Industry (CII) is a major recognition at National level.

6.4 Net working capital (Net Current Asset) Net working capital as a percentage of sales of the company stood at 27.0%, which in the previous year 2010 was 28.5%. The Company took 93 days to convert its working capital to sales revenue against 92 days in the previous year 2010.

H. Internal Control System

F. Key Ratios

reliability of underlying processes in achieving

The Company has an effective and reliable internal control system which is complimented by a Code of Business Conduct binding all its employees to achieve high standards in Corporate Governance. The internal control system is designed to ensure quality and operational efficiency, reliability of financial data and

Ratio

2010

2011

checks and control systems are validated by self

Return On Capital Employed (%)

27.1%

29.5%

audits, verified during internal audits and reviewed by the Audit Committee. The scope of internal audit is

Inventory Turnover ratio (In Days)*

37

46

Debtors Turnover ratio (In Days) *

36

38

2.01

2.02

Current Ratio Number of Days In Working Capital (Days) No. of Employee (Average)

safe-guarding of assets. The efficacy of internal

oriented towards mitigating or eliminating risks in business processes. The Audit Committee reviews the internal audit plan, significant audit findings and sustainability of measures for corrective actions. The internal Audit Plan is also aimed at addressing concerns, if any of

92

93

11,360

12,171

*Average is the simple average of opening and closing balance. G. Human Resource Development Emphasis on enhancement of employee’s skill and competence in the Company continued as in the previous years. Special emphasis was laid on development of Leadership capabilities at the Middle and Senior Management levels. Significant efforts and measures have been taken to integrate more women in the organization and to

Statutory Auditors of the Company. I. Opportunities and Threats The Company is all set to leverage the demand in the automotive sector specifically commercial vehicles and tractors. However, the passenger vehicle segment will see a moderate growth. Increased demand for safe personal mobility and increased consumer spending capability are key drivers that will boost sales in this segment. Non-Automotive businesses are also pitched to grow in the backdrop of committed focus and spending in infrastructure related projects. The rising gap between demand and generation / supply of

56 | Management Discussion and Analysis Report I Annual Report 2011

electricity will continue to create additional demand for auxiliary power units powered by diesel as well as other sources of energy viz. solar. Also the change in awareness in the use of renewable source of energy provides scope for new business e.g. Solar Energy, Thermo Technology, etc. J. Risks and Concerns 1. Regulatory risk: The changes in the tax laws, Government policies and regulatory requirement might affect the Company’s business. 2. Input Costs and Inflation: Prices of inputs are expected to rise significantly. Whilst the Company continues to pursue cost reduction initiatives, increase in price of input materials and rupee depreciation could impact the Company’s profitability to the extent that the same are not absorbed by the market through price increases and/or could have a negative impact on the demand in the domestic market. 3. Currency Risk: The operations are subject to risk arising from fluctuations in exchange rates with reference to currencies in which the Company transacts. These risks primarily relate to fluctuations of Euro and USD to INR, the management will take appropriate decisions to mitigate the risk. 4. Competition: The Company is operating in a highly competitive market which may exerts pressure both on the top line as well as the bottom line of the Company. 5. Other Risks: There is no credit and liquidity risk foreseen by the company due to its strong financial position.

The following are the few initiatives taken by the management for mitigating the above mentioned risks; ü Continuous improvement activities and implementing lean practices/processes through the Bosch Production System (BPS). ü Retain and motivate talent by focused employee development programs. ü Enhance local engineering, development and testing capabilities to further drive the “develop locally for the local market” concept. ü Focus on cost reduction, productivity improvement and import substitution projects. K. Outlook The Primary outlook for 2012 shows a moderate growth of around 10% mainly due to continued poor market sentiments coupled with high interest rates and global economic concerns. The slow down seen in second half of 2011 is likely to continue into the first half of 2012 also. Slow growth is mainly attributed by poor market sentiment, high level of inflation leading to higher interest rates, external conditions, dampened investment demand and rupee depreciation. Growth outlook will depend on global conditions and domestic policy reforms. Government spending on infrastructure projects is likely to continue at a similar pace with more focus on urban transportation, major highway projects and electricity generation, both with conventional and non-conventional sources. Increased per capita income, increased liquid fund in market, higher discretionary spending, growing aspirations of the Indian middle class, growth of retail credit are the other key drivers of the economy this year.

Disclaimer The information and opinion expressed in this section of the Annual report consists of certain ‘forward looking statements’ which management believes are true to the best of its information at the time of its preparation. The company shall not be liable for any loss, which may arise as a result of any action taken on the basis of the information contained herein. The information contained herein may not be disclosed, reproduced or used in whole or in part for any purpose or furnished to any other person without the express prior written permission of the Company.

Annual Report 2011

I

Report on Corporate Social Responsibility | 57

Report on Corporate Social Responsibility The Company’s responsibility towards Society and

Community Development and Vocational Training.

Environment is guided by Bosch values, Bosch

These are deployed through the social

principles of social responsibility, work safety and

responsibility model that is communicated across

environment protection. The Bosch principles of

the Plants through posters, visual boards and

social responsibility includes - human rights,

handouts and guides. This aid in generating large

equal opportunities, integration of handicapped

number of volunteers willing to do their best

people, free choice of jobs, rights of children,

towards the betterment of the society that

relations with associate representatives and their

people live in. In the spirit of our founder Robert

institutions, fair working conditions, occupational

Bosch, the Company demonstrates social and

health and safety, clean and safe environment

environment responsibility wherever it does

with social engagement.

business.

The Company is promoting the interests of

Some of the CSR initiatives undertaken by the

underprivileged and impaired sections of society

respective Plants during the year 2011 are

through its contributions for the social work

summarized below.

carried out by charitable organizations, old age homes and schools, and participates in women

Bangalore Plant:

empowerment programs. The Company shares its

Under the Child Health Development Program,

best practices through information sharing

the Plant organized a health check up camp for

sessions with other companies, Non

the Munichinappa Government School, Adugodi,

Governmental Organizations (NGO) and

based on need analysis of underprivileged

professional bodies. To sustain cultural values,

society around the Bangalore Plant, wherein the

the Company supports cultural activities through

healthy children ratio improved to 93% from 7%

its fine arts club. During the times of natural

in 2011. The Diesel Systems Management of

calamities like floods, cyclone, tsunami,

Bosch at Stuttgart, Germany, recognized the

earthquake etc., the Company actively supports

above project as Business Excellence examples

the affected people through voluntary

and gave a ‘Humanity Award’ to the team.

participation and donations. In 2011, the Plant adopted 8 more Government The Company has four thrust areas focusing on

schools covering 1,080 children within a radius

the Health & Hygiene, Environment Education,

of 3 kms around the Company’s Plant location.

Demonstration by one of Company’s volunteers on Environment

During the year 2011, 143 houses were made ready and handed

Education to school children of a Government School in

over to the villagers at Kairwadgi, near Bagalkote, Karnataka who

Wilson Garden, Bangalore.

were affected by the floods in 2010.

58 | Report on Corporate Social Responsibility(CSR) I Annual Report 2011

The health camp report revealed that there were

appreciation award for CSR activities by the

1,300 cases to be treated. Further referrals to

corporate Diesel Systems. ‘Manasi’ works for the

the specialist doctors were resorted for chronic

upliftment of the underprivileged in the

cases for treatment of various ailments/surgeries.

neighborhood with a focus on women & children, which continues its activities for the 8 th

The Plant collaborated with a Government

consecutive year.

recognized NGO to implement environment education program in schools in the

The Plant in association with Art of Living

neighborhood. As a new initiative in 2011,

Foundation, which has involved in constructing

awareness on four themes on water, waste

143 houses for the homeless in Gulbarga District

segregation, noise and air pollution is given to the

of the Karnataka State, handed over officially the

school children every month and at the end of

houses to the villagers in Kairwadgi that was hit

each theme session, a competition was held on

by the North Karnataka flood.

the above themes like drawing, painting, story writing, debate, etc and prizes were distributed.

The various activities of 'Clean Air' campaign

Around 1,100 children from the Government

continued in full swing and have now been

school have been covered.

spread to the Company’s Nashik Plant as well. The ‘Clean Air’ campaign has multiplied in

The Plant which is supporting the differently

Bangalore which is being well appreciated by the

abled people through the organization called

various stakeholders like the students in colleges

'Ability in disability Foundation (AID)' since 2009,

& schools, auto, cab & bus drivers and general

has increased the strength of the differently abled

public. This is mainly to bring awareness on

people to 62 inside the Plant and also gave

environment pollution and various measures to

employment to 34 off-site. The work related

reduce the same.

problems of the differently abled people had been addressed by way of providing them appropriate

The Plant organized a ‘Society Day’ for the

toilet facilities and canteen facilities.

stakeholders on 28 th November 2011. The Plant Management made a presentation to the

‘Manasi’ a social service initiative by the lady

stakeholders from officials of State Government,

employees of Bangalore Plant was recognized for

members representing charitable institutions,

Participation by the Company in the Emission Checking Campaign organized by Govt .of Karnataka Traffic Police Dept.and Transport Dept. Bangalore Police CommissionerMr.Jyothi Prakash Mirji, KSPCB Chairman-Mr.Sadashivaiah , Additional Police CommissionerMr.Saleem and Joint Transport Commissioner- Mr. Hemanth kumar Inaugurated this drive.

Dr. APJ Abdul Kalam, the Former President of India, interacting with the Apprentices at the Bosch Vocational Centre during his visit to the Bangalore Plant on June 01, 2011.

Annual Report 2011

I

Report on Corporate Social Responsibility(CSR) | 59

NGO’s etc., about the community development

for the underprivileged youth from the

projects and other related activities taken up by

neighborhood.

the Plant during the year 2011. The stakeholders appreciated the efforts taken up by the Plant. The

Nashik Plant:

suggestions offered by the participants were

The Plant organised annual health camp in which

recorded for future action.

around 800 people from Dahalewadi and surrounding villages were diagnosed and treated

The Company always emphasized on skill

for ailments and free medicines were provided.

development and has believed in keeping in tune

Eminent Specialists from different fields lent

with the latest technology in the market. In the

their expertise for this social cause. Further,

pursuit of improving the skill set and thereby

provisions of nutritious diet to the needy and the

improving the demographic dividend of India, the

dental health check-ups have improved the

Company continues to offer comprehensive and

health condition. Also, health and hygiene

exhaustive skill based training programs under

awareness sessions were conducted on regular

the aegis of ‘Bosch Vocational Centre (BVC)”. The

basis especially for girls and women not only in

Company imparts training to students under

adopted village but also in other schools in tribal

‘Apprentices’ scheme and to students under

area. Guidance and help was extended to

‘engineering stream’ besides imparting training to

patients to take advantage of Government

its own employees at BVC. The BVC also conducts

medical schemes. An ENT camp was conducted

training programs for business partners, other

in a school for hearing impaired children. 132

business units and employees’ children.

children attended the camp. Free medicines were issued to needy.

As a new initiative under the focus area of vocational training, CNC training and training on

In continuation with Income generating programs

Power Tools was imparted to the instructors of

for Economic empowerment of the

Government ITI s. The students of these

underprivileged in the neighborhood villages,

institutes were given practical training on Diesel

more Self Help Groups (SHG) were formed,

engines by our Bosch Technical Centre and also

youngsters were trained for motor driving skills.

training at Maruti Solar Automobiles. Also,

About 300 fruit bearing trees were planted in the

computer courses were conducted by BanP/BVC

village to generate additional income. Renovation

Health Camp organized by the Nashik Plant at a village in Nashik

Nashik Run organized by the Nashik Run Charitable Trust in 2011

60 | Report on Corporate Social Responsibility(CSR) I Annual Report 2011

of Anganwadi School carried out in previous

Jaipur Plant

years, has resulted in 100 percent increase in

The RO plant set up Jaipur Plant provided

attendance of children. The supplementary

drinking water to 513 families in and around the

nutritious diet organized by the Plant has resulted

Goner village. The plant’s operating expenses

in improved health in 2011.

were met with selling of water and the sale was about 8,000 liters a day. This volume has ensured

Solar street lamps were provided in the

the sustenance of the plant.

neighboring villages to overcome hardships due to power shortages. Drinking water was made

The Plant has also adopted an Industrial Training

available to the villagers by reinstating the

Institute and has got it shifted to Sanganer, which

pumping system. The Plant undertakes tree

has enabled the ITI to get the much awaited NCVT

plantation every year, across Nashik City along

accreditation.

Necessary infrastructure in class

with Municipal Corporation. Till date a stretch of

rooms has been provided and the campus is being

about 15 kms of roads are covered with

maintained by the inmates. A grant of ` 25 mio.

greenery. To generate awareness about vehicular

has been approved by the State Government, for

pollution and measures to reduce the same,

the development of the ITI.

“Clean air campaign“ was started from the year 2011.

The necessary improvement in the class rooms and providing furniture and black boards (glass

The 10 th year of the well-known ‘Nashik Run” was conducted by the Plant along with its neighboring

base) was done in 2011, in 5 schools. Computer laboratory was set up in one school.

corporates which had attracted 19000 participants. The funds collected and disbursed

With respect to one of our key focus area of

for social causes in last 10 years amounts to more

health and hygiene, a health camp covering about

than 60 million Rupees. The Nashik Run

300 children and 16 mothers and teachers was

Charitable Trust works for the benefit of

organized for dental health. About 95% were

underprivileged members/groups such as

detected to be suffering from various levels of

physically and mentally challenged, old age

Fluorosis. The treatment has also been started

people, orphan children, destitute ladies and

and 65 children and 7 teachers have already been

adivasis of the region.

treated in 2011.Toilets in two schools have been

Installation of solar lights in neighboring villages in Nashik

RO Plant set up by Bosch at Goner village close to the Bosch Jaipur Plant provides clean drinking water to around 500 families.

Annual Report 2011

improved for good hygiene.

I

Report on Corporate Social Responsibility(CSR) | 61

year of functioning, the Foundation had benefited 3,515 youth of various underprivileged

Rain water harvesting model was displayed in the

communities through support of skill trainings

Plant premises as ‘CSR corner’ to demonstrate

and medical projects.

the system to all the employees. Free consultation was arranged and awareness to employ the

Enabling lives and livelihood…

scheme in the houses was given. Energy day was

In order to enable people to live life with dignity,

organized in the Plant to help neighboring

it is important for them to become productive

industries to conserve energy. 200 trees were

members of society. This will create sustainable

planted outside the Plant premises.

development in the long run. Hence the vision of

Verna Plant, Goa:

in India includes the quality of life and the

The Plant continued in 2011 the project ‘Prerna’

importance of livelihood in sustaining life.

the Foundation created by the Bosch subsidiaries

with the aim to serve the needy and those neglected by their own kith and kin. The activities

Enabling Lives….

of Prerna are sponsored by the contributions

BIF supports two major health projects which

made by the employees of the Plant with

are aimed at correcting disabling physiological

additional support from the management. The

abnormalities of those children whose parents

Plant organised visit to a neighboring village in

cannot afford treatment.

June 2011 and distributed school bags and note books to the needy students from Class I to Class

For the third year, the Foundation supported 20

VII. The Plant associates were accorded a warm

surgeries for young children with complex

welcome by the school management for the

orthopedic problems and helped them walk.

efforts taken up.

Surgeries are conducted by Sparsh Vachana to a select set of 200 underprivileged children every

Bosch India Foundation:

year.

With the vision of “Enabling Lives and Livelihood”, in 2011, Bosch India Foundation (BIF)

The Foundation also continued its support to the

(www.boschindia.com/foundation) increased its

Gujarat Cleft and Craniofacial Research Institute

reach to 7 locations in India. By the end of its 3 rd

(GCCRI) which conducts free corrective

Sericulture – a BIF supported skill training program that doubles the income of rural women

‘Enabling Livelihood’ –training in electronics that also generates self employment

62 | Report on Corporate Social Responsibility(CSR) I Annual Report 2011

surgeries for those born with facial deformity.

mechanic, tractor mechanic, motor winding, AC

Over 800 children mainly from poor rural

mechanic, masonry, carpentry, tally accounting

localities have benefited from the support of BIF

and DTP through partnership with 20 committed

and been restored dignity.

NGOs who are in close contact with the

Change starts with awareness. Health awareness

year was the free Automobile Mechanic training

and check up camps were conducted along with

offered through the Bosch Training Centre in

community and its needs. The highlight of the

partners and doctors in four rural and urban

Ahmedabad for underprivileged youth. More such

slum areas to promote health and hygiene.

trainings using Bosch competence for social good is being planned. Yet another highlight was

Enabling Livelihood……

the vocational training support extended to 84

Over 40% of Indian youth drop out from school

mentally challenged and spastics’ youth across

mainly due to financial liabilities. BIF through

three locations in India. These trainings would

NGO partners provide these youth with skill

help these youth to earn a livelihood through

trainings to become productive members of

sheltered workshops.

India’s work-force. To ensure that the skill trainings are accessible and helpful to these

BIF presently supports about 37 batches of

underprivileged youth; they are offered free of

students (1,588 youth) in 22 trades across 7

cost, of short duration (2-6 months), high on

locations in India. BIF does its activities along

hands-on learning, flexi-timed and market

with the active support and involvement of Bosch

relevant.

volunteers in the various locations.

In 2011, vocational trainings were introduced in eight new trades such as automobile service

Annual Report 2011 | Auditors Report | 63

Auditors’ Report To The Members of Bosch Limited

1.

2.

3.

4.

We have audited the attached Balance Sheet of Bosch Limited (the “Company”) as at December 31, 2011, and the related Profit and Loss Account and Cash Flow Statement for the year ended on that date annexed thereto, which we have signed under reference to this report. These financial statements are the responsibility of the Company’s Management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by Management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. As required by the Companies (Auditor’s Report) Order, 2003, as amended by the Companies (Auditor’s Report) (Amendment) Order, 2004 (together the “Order”), issued by the Central Government of India in terms of sub-section (4A) of Section 227 of ‘The Companies Act, 1956’ of India (the ‘Act’) and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books; (c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account; (d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Act; (e) On the basis of written representations received from the directors, as on December 31, 2011 and taken on record by the Board of Directors, none of the directors is disqualified as on December 31, 2011 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Act; (f)

In our opinion and to the best of our information and according to the explanations given to us, the said financial statements together with the notes thereon and attached thereto give, in the prescribed manner, the information required by the Act, and give a true and fair view in conformity with the accounting principles generally accepted in India: (i)

in the case of the Balance Sheet, of the state of affairs of the company as at December 31, 2011;

(ii)

in the case of the Profit and Loss Account, of the profit for the year ended on that date; and

(iii)

in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Further to our comments in the Annexure referred to in paragraph 3 above, we report that: (a) We have obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the purposes of our audit;

For Price Waterhouse & Co. Firm Registration Number: 007567S Chartered Accountants Place : Bangalore Date : February 28, 2012

Radhakrishnan B Partner Membership Number: F25516

64 | Annexure to Auditors Report | Annual Report 2011

Annexure to Auditors’ Report Referred to in paragraph 3 of the Auditors’ Report of even date to the members of Bosch Limited on the financial statements for the year ended December 31, 2011.

1. (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation, of fixed assets. (b) The fixed assets are physically verified by the Management according to a phased programme designed to cover all the items over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the Management during the year and no material discrepancies between the book records and the physical inventory have been noticed. (c) In our opinion and according to the information and explanations given to us, a substantial part of fixed assets has not been disposed of by the Company during the year. 2. (a) The inventory (excluding stocks with third parties) has been physically verified by the Management during the year. In our opinion, the frequency of verification is reasonable. In respect of inventory lying with third parties, these have substantially been confirmed by them. (b) In our opinion, the procedures of physical verification of inventory followed by the Management are reasonable and adequate in relation to the size of the Company and the nature of its business. (c) On the basis of our examination of the inventory records, in our opinion, the Company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material. 3. (a) The Company has granted unsecured loan to a Company covered in the register maintained under Section 301 of the Act. The maximum amount involved during the year and the year-end balance of the aforesaid loan amounts to ` 240,000,000. (b) In our opinion, the rate of interest and other terms and conditions of the aforesaid loan is not prima facie prejudicial to the interest of the Company. (c) In respect of the aforesaid loan, the party is repaying the principal amounts as stipulated and is also regular in payment of interest, where applicable. (d) In respect of the aforesaid loan, there is no overdue amount more than Rupees One Lakh. (e) The Company has not taken any loans, secured or unsecured, from companies, firms or other parties covered in the register maintained under Section 301 of the Act, accordingly sub clauses (f) and (g) of clause (iii) of Paragraph 4 of the Order are not applicable.

4.

In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets and for sale of goods and services. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us no major weakness have been noticed or reported.

5. (a) In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements referred to in Section 301 of the Act have been entered in the register required to be maintained under that section. (b)In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees Five Lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time. 6. The Company has not accepted any deposits from the public within the meaning of Sections 58A and 58AA of the Act and the rules framed there under. 7. In our opinion, the Company has an internal audit system commensurate with its size and nature of its business. 8. We have broadly reviewed the books of account maintained by the Company in respect of products where, pursuant to the Rules made by the Central Government of India, the maintenance of cost records has been prescribed under clause (d) of sub-section (1) of Section 209 of the Act, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete. 9. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing the undisputed statutory dues including provident fund, investor education and protection fund, employees’ state insurance, income-tax, sales-tax, wealth tax, service tax, customs duty, excise duty, cess and other material statutory dues as applicable with the appropriate authorities. (b) According to the information and explanations given to us and the records of the Company examined by us, the particulars of dues of income-tax, sales-tax, wealth-tax, service-tax, customs duty, excise duty and cess as at December 31, 2011 which have not

Annual Report 2011 | Annexure to Auditors Report | 65

been deposited on account of a dispute, are as follows:

Name Nature Disputed Payment of the of dues Amount made in statute (TINR) the normal course of appeal proceedings (TINR) Central Excise 27,824 Excise duty, Act, Service 1944 Tax and interest 14,698 10,740

Period to Forum which the where the amount dispute is relates pending

1992-94, Up to 2002-04, Commis2005-11 sioner’s Level 1998-01, Customs, 2003-06 Excise, Service Tax Appellate Tribunal 2002-04 High Court 1985-88, Supreme 1994-95 Court 1991-92, Up to 2009-10 Commissioner’s Level 2009-10 Customs, Excise, Service Tax Appellate Tribunal 1979-80, Up to 1983-84 Commissioner’s Level 1990-94, High 1995-04 Court 1993-94, Up to 1995-10 Commissioner’s Level

6,466

-

29,016

-

Customs Customs 51,696 Act, duty and 1962 interest

-

5,859

3,645

941

-

75,843

-

67,601

10,794

28,845

22,808 1996-97, 1998-99, 2000-01, 2002-05 - 1993-94, 1999-01

Income Income Tax Act, tax and 1961 interest

State and Central Sales Tax Acts

Entry Tax Act

Sales tax, interest and penalty

Entry tax and interest

6,721

3,478

Sales Tax Tribunal

10.

The Company has no accumulated losses as at December 31, 2011 and it has not incurred any cash losses in the financial year ended on that date or in the immediately preceding financial year.

11.

According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of dues to any financial institution or bank or debenture holders as at the balance sheet date.

12.

The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13.

The provisions of any special statute applicable to chit fund/ nidhi/ mutual benefit fund/ societies are not applicable to the Company.

14.

In our opinion, the Company is not a dealer or trader in shares, securities, debentures and other investments.

15.

In our opinion and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions during the year.

16.

The Company has not obtained any term loans.

17.

On the basis of an overall examination of the balance sheet of the Company, in our opinion and according to the information and explanations given to us, there are no funds raised on a short-term basis which have been used for long-term investment.

18.

The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Act during the year.

19.

During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the Management.

20.

The other clauses, (xix) and (xx) of paragraph 4 of the Companies (Auditor’s Report) Order 2003, as amended by the Companies (Auditor’s Report) (Amendment) Order, 2004, are not applicable in the case of the Company for the year, since in our opinion there is no matter which arises to be reported in the aforesaid Order.

Up to Commissioner’s Level

- 1991-93 High Court

For Price Waterhouse & Co. Firm Registration Number: 007567S Chartered Accountants Place : Bangalore Date : February 28, 2012

Radhakrishnan B Partner Membership Number: F25516

66 | Financial Statements | Annual Report 2011

Balance Sheet as at December 31, 2011

[` in Thousands (TINR)] Schedule

2011

2010

SOURCES OF FUNDS Shareholders' Funds Share Capital

1

313,989

313,989

Reserves and Surplus

2

46,970,361

40,666,425 47,284,350

40,980,414

Loan Funds Secured Loans

3

181,095

30,435

Unsecured Loans

4

2,890,325

2,733,454

Total

3,071,420

2,763,889

50,355,770

43,744,303

APPLICATION OF FUNDS Fixed Assets

5

Gross Block

34,301,409

30,237,959

Less : Depreciation

28,100,495

25,878,075

Net Block

6,200,914

4,359,884

Capital Work-in-Progress

4,406,644

2,242,165

Investments

6

Deferred Tax Asset [Refer Note 7 of Schedule 19]

10,607,558

6,602,049

16,063,646

16,073,030

2,276,000

2,182,000

Current Assets, Loans and Advances Inventories

7

11,830,574

8,092,812

Sundry Debtors

8

9,492,112

7,209,659 13,258,674

9

9,514,538

Other Current Assets

Cash and Bank Balances

10

503,094

589,214

Loans and Advances

11

11,022,277

8,370,506

42,362,595

37,520,865

Less : Current Liabilities and Provisions Current Liabilities

12

15,271,322

13,370,518

Provisions

13

5,682,707

5,263,123

20,954,029 Net Current Assets Total Notes on Accounts

18,633,641 21,408,566

18,887,224

50,355,770

43,744,303

19

The schedules referred to above form an integral part of the Balance Sheet This is the Balance Sheet referred to in our Report of even date For and on behalf of the Board

For Price Waterhouse & Co. Firm Registration Number: 007567S Chartered Accountants

Dr. A. Hieronimus B. Muthuraman Renu S Karnad Prasad Chandran Soumitra Bhattacharya

Radhakrishnan B Partner Membership Number: F25516 Place : Bangalore Date : February 28, 2012

A. Vijay Shankar Company Secretary

Directors

V.K. Viswanathan Dr. Manfred Duernholz

Annual Report 2011 | Financial Statements | 67

Profit and Loss Account for the year ended December 31, 2011

[` in Thousands (TINR)] Schedule

2011

2010

INCOME Gross Sales

85,331,640

Less : Excise duty Net Sales Income from Services

70,721,699

6,036,936

4,416,665

79,294,704

66,305,034

677,136

512,449

Interest

14

1,842,460

1,144,279

Other Income

15

2,977,884

2,892,518 84,792,184

70,854,280

EXPENDITURE Cost of Goods Sold

16

44,435,621

35,984,153

Operating Expenses

17

22,747,463

20,644,209

Depreciation Less : Expenses Capitalised

2,578,404

2,539,651

69,761,488

59,168,013

709,158

PROFIT BEFORE TAX

341,645 69,052,330

58,826,368

15,739,854

12,027,912

Provision for Taxation Income tax - for the year

4,710,000

- excess reversal relating to prior years

(101,730)

(53,138)

(94,000)

(168,000)

Deferred tax (credit)/ charge PROFIT AFTER TAX Profit brought forward from previous year Profit available for Appropriation

3,660,000

4,514,270

3,438,862

11,225,584

8,589,050

6,668,829

3,291,319

17,894,413

11,880,369

APPROPRIATIONS -

623

Proposed Final Dividend

Capital Reserve

1,569,945

1,255,956

Interim Dividend

2,668,907

-

Tax on Proposed Final Dividend

254,684

208,599

Tax on Interim Dividend

432,963

-

(4,851)

(3,638)

Reversal of Dividend Distribution Tax General Reserve

5,000,000

3,750,000

Profit carried forward

7,972,765

6,668,829

17,894,413

11,880,369

358

274

Details of R & D Expenses/ (Income)

18

Notes on Accounts

19

Earnings per share - Basic and Diluted (in `) of face value of ` 10 each [Refer Note 6 of Schedule 19] The schedules referred to above form an integral part of the Profit and Loss Account This is the Profit and Loss Account referred to in our Report of even date

For and on behalf of the Board

For Price Waterhouse & Co. Firm Registration Number: 007567S Chartered Accountants

Dr. A. Hieronimus B. Muthuraman Renu S Karnad Prasad Chandran Soumitra Bhattacharya

Radhakrishnan B Partner Membership Number: F25516 Place : Bangalore Date : February 28, 2012

A. Vijay Shankar Company Secretary

Directors

V.K. Viswanathan Dr. Manfred Duernholz

68 | Financial Statements | Annual Report 2011

Cash Flow Statement for the year ended December 31, 2011 [` in Thousands (TINR)]

A

B

C

Cash flow from operating activities Profit before tax Adjustments for : Depreciation Unrealised Exchange difference (Profit) / Loss on sale of fixed assets (Profit) / Loss on sale / redemption of investments Premium paid on investments amortised Profit on sale of business Dividend income Interest income Interest expense

2011

2010

15,739,854

12,027,912

2,578,404 (29,639) (9,223) (793,276) 15,573 (193,576) (1,846,731) 4,271

2,539,651 3,987 (6,815) 10,097 (623) (403,653) (1,183,618) 39,339

Operating profit before working capital changes Adjusted for : (Increase) / decrease in inventories (Increase) / decrease in sundry debtors (Increase) / decrease in loans and advances Increase / (decrease) in current liabilities and provisions

15,465,657

13,026,277

(3,737,762) (2,282,453) (747,004) 1,990,821

(2,581,011) (1,376,380) (1,388,325) 5,205,260

Cash generated from operations Direct taxes paid (net of refunds)

10,689,259 (4,683,037)

12,885,821 (4,026,727)

6,006,222

8,859,094

(6,587,236) 12,546 (8,550,000) 9,493,276 7,280,000 (7,600,000) (1,510,000) 37,385 1,932,851

(3,021,270) 15,712 623 (12,477,680) 10,944,114 5,438,800 (6,218,800) (830,000) 30,212 1,054,453

(5,491,178)

(5,063,836)

307,531 (3,924,863) (636,711) (5,309)

(79,245) (941,967) (156,449) (36,433)

Net cash from operating activities Cash flow from investing activities Additions to fixed assets Sale of fixed assets Considerations received from sale of business Purchase of investments Sale of investments Inter corporate deposit repayment received Inter corporate deposit given Inter corporate loans (given) / repayment received Dividend received Interest received Net cash from / (used in) investing activities Cash flow from financing activities Proceeds/ (Repayment) from borrowings (Net) Dividends paid Tax on Dividend Distribution Interest paid Net cash from / (used in) financing activities

(4,259,352)

(1,214,094)

Net cash flows during the year (A+B+C)

(3,744,308)

2,581,164

Unrealised exchange gain/(loss) on cash and cash equivalents Cash and cash equivalents (Opening balance as per schedule 9) Cash and cash equivalents (Closing balance as per schedule 9)

172 13,258,674 9,514,538

(190) 10,677,700 13,258,674

Notes : 1) Above Cash Flow Statement has been prepared under indirect method in accordance with the Accounting Standard 3 as notified under section 211(3C) of the Companies Act, 1956. 2) Conversion of Investments in mutual funds from one plan to another and dividend reinvested has not been considered above as there was no actual cash inflow/ outflow. 3) Closing balance of cash and cash equivalents includes restricted cash in the form of unclaimed dividend of TINR 19,724 (2010: TINR 9,781).

This is the Cash Flow Statement referred to in our Report of even date For and on behalf of the Board

For Price Waterhouse & Co. Firm Registration Number: 007567S Chartered Accountants

Dr. A. Hieronimus B. Muthuraman Renu S Karnad Prasad Chandran Soumitra Bhattacharya

Radhakrishnan B Partner Membership Number: F25516 Place : Bangalore Date : February 28, 2012

A. Vijay Shankar Company Secretary

Directors

V.K. Viswanathan Dr. Manfred Duernholz

Annual Report 2011 | Financial Statements | 69

Schedules to Balance Sheet

[` in Thousands (TINR)]

SCHEDULE 1: SHARE CAPITAL

2011

2010

Authorised 38,051,460 (2010 : 38,051,460) Equity shares of ` 10 each

380,515

380,515

380,515 66,526

380,515 66,526

313,989

313,989

Issued, Subscribed and fully Paid up 38,051,460 (2010 : 38,051,460) Equity shares of ` 10 each Less: Equity Shares bought back [Refer Note 3 and 5 below] Net Issued, Subscribed and fully Paid up 31,398,900 (2010: 31,398,900) Equity shares of ` 10 each Notes: 1. 22,349,420 (2010 : 22,349,420) Equity shares are held by Robert Bosch GmbH (Federal Republic of Germany), the holding company. 2. 3,469,558 (2010 : 3,469,558) Equity shares of ` 100 each were allotted as bonus shares by capitalisation of reserves and 48,000 (2010 : 48,000) Equity sares of ` 100 each were allotted pursuant to a contract for consideration other than cash. 3. 600,000 (2010 : 600,000) Equity shares of ` 100 each were bought back in the years 2000, 2001 and 2002 under Section 77A of the Companies Act, 1956 and Securities Exchange Board of India (Buy Back of Securities) Regulations, 1998. 4. The Company's Equity shares of ` 100 each were sub-divided into Equity shares of ` 10 each with effect from July 16, 2004. 5. 652,560 (2010 : 652,560) Equity shares of ` 10 each were bought back in the year 2008 and 2009 under Section 77A of the Companies Act, 1956 and Securities Exchange Board of India (Buy Back of Securities) Regulations, 1998.

[` in Thousands (TINR)]

SCHEDULE 2: RESERVES AND SURPLUS

2011

2010

Capital Reserve (Refer Note 1 below) Opening Balance Addition Closing Balance Share Premium Account Capital Redemption Reserve

42,615

41,992

-

623

42,615

42,615

8,069

8,069

66,526

66,526

33,880,386

30,130,386

5,000,000

3,750,000

38,880,386

33,880,386

General Reserve Opening Balance Addition Closing Balance Profit and Loss Account

7,972,765

6,668,829

46,970,361

40,666,425

Note: 1. Capital Reserve comprises of: -

Profit on sale of Business to Bosch Rexroth (India) Limited TINR 2,600 (2010 : TINR 2,600) GTZ Aid received TINR 4,001 (2010 : TINR 4,001) Profit on sale of Business to Bosch Chassis Systems India Ltd TINR 2,500 (2010 : TINR 2,500) Profit on sale of Business to ED Electronic Devices Wholesale Trading Pvt Ltd TINR 29,577 (2010: TINR 29,577) Profit on sale of Business to Bosch Electrical Drives India Pvt Ltd TINR 3,918 (2010: TINR 3,918) Others TINR 19 (2010 :TINR 19)

70 | Financial Statements | Annual Report 2011

Schedules to Balance Sheet

[` in Thousands (TINR)]

SCHEDULE 3: SECURED LOANS

2011 Cash credit from Banks (Secured by hypothecation of present and future stocks of raw materials, finished goods, work-in-progress and book debts)

2010

181,095

30,435

181,095

30,435

[` in Thousands (TINR)]

SCHEDULE 4: UNSECURED LOANS

2011 Interest free Sales Tax Deferral Loan from Government of Maharashtra and Rajasthan [Amount repayable within one year : TINR 617,184 (2010: TINR 15,166)]

2010

2,890,325

2,733,454

2,890,325

2,733,454

SCHEDULE 5: FIXED ASSETS

[` in Thousands (TINR)] GROSS BLOCK

PARTICULARS 2010 Land - Freehold

DEPRECIATION

Additions Deductions/ Adjustments

2011

For the year

2010

NET BLOCK

Deductions/ Adjustments

2011

2011

2010

67,181

-

-

67,181

-

-

-

-

67,181

67,181

- Leasehold (Refer Note 1 below)

173,061

718,790

-

891,851

12,999

901

-

13,900

877,951

160,062

Buildings (Refer Note 2 below)

2,342,009

11,774

-

2,353,783

1,396,473

90,558

-

1,487,031

866,752

945,536

111,240

1,826

-

113,066

111,240

1,826

-

113,066

-

-

27,311,036 21,539,881 2,003,126

329,083

Buildings - R & D*

24,450,404

3,175,832

315,200

Plant and Machinery - R & D*

Plant and Machinery

1,587,998

331,912

18

1,919,892

1,587,998

331,912

18

1,919,892

-

-

Furniture and Equipment

1,062,865

115,046

26,868

1,151,043

882,030

83,584

10,449

955,165

195,878

180,835

Furniture and Equipment R & D* Motor Vehicles Motor Vehicles - R & D*

Previous year

23,213,924 4,097,112 2,910,523

81,851

2,441

719

83,573

81,851

2,441

719

83,573

-

-

342,829

59,986

14,805

388,010

247,082

58,906

14,018

291,970

96,040

95,747

18,521

5,150

1,697

21,974

18,521

5,150

1,697

21,974

-

-

30,237,959

4,422,757

359,307

34,301,409 25,878,075 2,578,404

355,984

28,100,495 6,200,914 4,359,884

28,711,892

1,775,769

249,702

30,237,959 23,579,229 2,539,651

240,805

25,878,075

Capital work-in-progress (Refer Note 3 below)

4,406,644 2,242,165 10,607,558 6,602,049

Notes: 1) Registration formalities is pending completion in respect of additions during the year. 2) Includes TINR 1 (2010: TINR 1) being the value of shares in co-operative housing societies. 3) Includes capital advances TINR 1,199,681 (2010: TINR 271,183) and machinery in transit TINR 1,282,048 (2010: TINR 205,665) * Relating to DSIR approved R & D facilities, proposed to be considered for certain Income Tax benefit.

Annual Report 2011 | Financial Statements | 71

Schedules to Balance Sheet

SCHEDULE 6: INVESTMENTS Investments (Long term, unquoted, unless otherwise stated)

[` in Thousands (TINR)] Amount

Number 2011

2010

2011

100,000

100,000

2010

A NON - TRADE INVESTMENTS IN SUBSIDIARY COMPANY AT COST: SHARES MICO Trading Private Ltd. Equity Shares of ` 10/- each fully paid TOTAL - A

1,000

1,000

1,000

1,000

175,000

175,000

175,000

175,000

B TRADE INVESTMENTS AT COST: SHARES MHB Filter India Private Ltd., Equity Shares of ` 10/- each fully paid

17,500,000

17,500,000

TOTAL - B C NON-TRADE INVESTMENTS AT COST: SHARES, DEBENTURES AND BONDS ICICI Bank Ltd. Equity Shares of ` 10/- each fully paid (Quoted)

437,110

437,110

16,487

16,487

3,404,800

3,404,800

13,619

13,619

188,500

37,700

364

364

Rural Electrification Corporation Ltd. 6.25% Capital Gains Secured Redeemable Bonds of ` 10,000/- each

500

500

5,000

5,000

6% Capital Gains Secured Redeemable Bonds of ` 10,000/- each

500

500

5,000

5,000

38,000

38,000

3,832,131

3,847,706

1,500

1,500

150,000

150,000

4,022,601

4,038,176

Housing Development Finance Corporation Ltd. Equity Shares of ` 2/- each fully paid (Quoted) HDFC Bank Ltd. Equity Shares of ` 2/- each (2010: ` 10/- each) fully paid (Quoted) (During the year Equity shares are sub divided at 1:5)

India Infrastructure Finance Corporation Limited 6.85% Tax Free Unsecured Bonds of ` 100,000/- each (Quoted) Indian Railway Finance Corporation 6% Tax Free Secured Bonds of ` 100,000/- each (Quoted) TOTAL - C D NON-TRADE INVESTMENTS AT COST: UNITS OF MUTUAL FUNDS Birla Sunlife Mutual Fund Birla Sunlife Fixed Term Plan - Series CF - 367 Days Growth Option of ` 10/- each (15,000,000 Units matured during the year)

-

15,000,000

-

150,000

Birla Sunlife Fixed Term Plan - Series CG - 367 Days Growth Option Units of ` 10/- each (15,000,000 Units matured during the year)

-

15,000,000

-

150,000

Birla Sunlife Fixed Term Plan - Series DX - Growth Option Units of ` 10/- each (15,000,000 Units purchased during the year)

15,000,000

-

150,000

-

Birla Sunlife Fixed Term Plan - Series DY - Growth Option Units of ` 10/- each (20,000,000 Units purchased during the year)

20,000,000

-

200,000

-

72 | Financial Statements | Annual Report 2011

Schedules to Balance Sheet

SCHEDULE 6: INVESTMENTS (Contd.) Investments (Long term, unquoted, unless otherwise stated)

[` in Thousands (TINR)] Amount

Number 2011

2010

2011

2010

Deutsche Mutual Fund Deutsche Fixed Term Plan - Series 71 - Growth Option Units of ` 10/- each (25,000,000 units matured during the year)

-

25,000,000

-

250,000

Deutsche Fixed Term Plan - Series 72 - Growth option Units of ` 10/- each (15,000,000 units matured during the year)

-

15,000,000

-

150,000

Deutsche Fixed Term Plan - Series 73 - Growth option of ` 10/- each (35,000,000 units matured during the year)

-

35,000,000

-

350,000

Deutsche Fixed Term Plan - Series 75 - Growth option of ` 10/- each (10,000,000 units matured during the year)

-

10,000,000

-

100,000

Deutsche Fixed Term Plan - Series 77 - Growth option of ` 10/- each (30,000,000 units matured during the year)

-

30,000,000

-

300,000

DWS Ultra Short Term - Institutional Fund - Growth option Units of ` 10/- each of Liquid Fund

23,219,095

23,219,095

250,000

250,000

DWS Fixed Term Fund Series 81 - Growth option Units of ` 10/- each (20,000,000 units purchased during the year)

20,000,000

-

200,000

-

DWS Fixed Term Fund Series 80 - Growth option Units of ` 10/- each (30,000,000 units purchased during the year)

30,000,000

-

300,000

-

DWS Fixed Term Fund - Series 88 - Growth option Units of ` 10/- each (25,000,000 units purchased during the year)

25,000,000

-

250,000

-

DWS Fixed Term Fund - Series 92 - Growth option Units of ` 10/- each (20,000,000 units purchased during the year)

20,000,000

-

200,000

-

DWS Fixed Term Fund - Series 95 - Growth option Units of ` 10/- each (20,000,000 units purchased during the year)

20,000,000

-

200,000

-

-

25,000,000

-

250,000

Fidelity Fixed Maturity Plan Series 5 - Plan E - Growth Option Units of ` 10/- each (20,000,000 units purchased during the year)

20,000,000

-

200,000

-

Fidelity Fixed Maturity Plan Series 6 - Plan C - Growth option Units of ` 10/- each (20,000,000 units purchased during the year)

20,000,000

-

200,000

-

-

262,141,598

-

2,700,000

231,236,268

215,635,240

2,315,045

2,158,854

21,220,970

21,220,970

250,000

250,000

Fidelity Mutual Fund Fidelity Fixed Maturity Plan Series 3 - Plan F - Growth option Units of ` 10/- each (25,000,000 units matured during the year)

Franklin Templeton Fund Templeton India Income Oppurtunities Fund Fixed Term Plan Growth option Units ` 10/- each (262,141,598 units matured during the year) Templeton India Ultra Short Bond Fund Super Institutional Plan Daily Dividend Units of ` 10/- each of Liquid Fund (15,601,028 units re-invested during the year) Templeton India Ultra short bond fund Super Institutional Plan Growth Unit of ` 10/- each of Liquid Fund

Annual Report 2011 | Financial Statements | 73

Schedules to Balance Sheet

SCHEDULE 6: INVESTMENTS (Contd.) Investments (Long term, unquoted, unless otherwise stated)

[` in Thousands (TINR)] Amount

Number 2011

2010

2011

2010

HDFC Mutual Fund HDFC Fixed Maturity Plan 13 M March 10 - Series XII - Growth option Units of ` 10/- each (25,000,000 units matured during the year)

-

25,000,000

-

250,000

HDFC Fixed Maturity Plan 13 M March 10(2) - Series XII - Growth option Units of ` 10/- each (25,000,000 units matured during the year)

-

25,000,000

-

250,000

HDFC Fixed Maturity Plan 370 D June 2010 (1) Series - XV - Growth option Units of ` 10/- each (37,500,000 units matured during the year)

-

37,500,000

-

375,000

HDFC Fixed Maturity Plan 370 D August 2010 (1) Series - XV - Growth option Units of ` 10/- each (35,000,000 units matured during the year)

-

35,000,000

-

350,000

HDFC Cash Management - Treasury Advantage Plan - Wholesale Growth option Units of ` 10/- each of Liquid Fund

12,452,990

12,452,990

250,000

250,000

HDFC Fixed Maturity Plan 370 D May 2011 (1) Series - XVIII - Growth option Units of ` 10/- each (50,000,000 units purchased during the year)

50,000,000

-

500,000

-

HDFC Fixed Maturity Plan 375 D July 2011 (2) Series - XVIII - Growth option Units of ` 10/- each (20,000,000 units purchased during the year)

20,000,000

-

200,000

-

HDFC Fixed Maturity Plan 370 D October 2011 (1) Series - XIX - Growth option Units of ` 10/- each (75,000,000 units purchased during the year)

75,000,000

-

750,000

-

HDFC Fixed Maturity Plan 370 D December 2011 (2) Series - XIX - Growth option Units of `. 10/- each (15,000,000 units purchased during the year)

15,000,000

-

150,000

-

ICICI Prudential Fixed Maturity Plan Series 51- 14 Months Plan D Institutional Growth option Units of ` 10/- each (25,000,000 units matured during the year)

-

25,000,000

-

250,000

ICICI Prudential Fixed Maturity Plan Series 51- 13 Months Plan C Institutional Growth option Units of ` 10/- each (30,000,000 units matured during the year)

-

30,000,000

-

300,000

ICICI Prudential Fixed Maturity Plan Series 51- 1 Year Plan B - 371 Days Institutional Growth option Units of ` 10/- each (25,000,000 units matured during the year)

-

25,000,000

-

250,000

ICICI Prudential Annual Interval Fixed Maturity Plan 1 Institutional Growth option Units of `. 10/- each (52,463,276 units matured during the year)

-

52,463,276

-

525,000

ICICI Prudential Fixed Maturity Plan Series 53 - 1 Year Plan A Cumulative Growth option Units of ` 10/- each (15,000,000 units matured during the year)

-

15,000,000

-

150,000

ICICI Prudential Annual Interval Fixed Maturity Plan - III - Institutional Growth option Units of ` 10/- each (29,994,601 units matured during the year)

-

29,994,601

-

300,000

ICICI Prudential Fixed Maturity Plan - Series 53 - 1 Year Plan D Cumulative Growth option Units of ` 10/- each (40,000,000 units matured during the year)

-

40,000,000

-

400,000

ICICI Prudential Fixed Maturity Plan Series 54 - 1 year Plan C Cumulative Growth option Units of ` 10/- each (20,000,000 units purchased during the year)

20,000,000

-

200,000

-

ICICI Prudential Fixed Maturity Plan Series 54 - 1 year Plan C Cumulative - Growth option Units of ` 10/- each (20,000,000 units purchased during the year)

20,000,000

-

200,000

-

ICICI Prudential Fixed Maturity Plan Series 54 - 1 year Plan C Cumulative Growth option Units of ` 10/- each (20,000,000 units purchased during the year)

20,000,000

-

200,000

-

ICICI Prudential Fixed Maturity Plan Series 56 - 1 year Plan E Cumulative Growth option Units of ` 10/- each (25,000,000 units purchased during the year)

25,000,000

-

250,000

-

ICICI Prudential Fixed Maturity Plan Series 55 - 1 year Plan G Cumulative Growth option Units of ` 10/- each (20,000,000 units purchased during the year)

20,000,000

-

200,000

-

ICICI Prudential Fixed Maturity Plan Series 57 - 1 year Plan A Cumulative Growth option Units of ` 10/- each (30,000,000 units purchased during the year)

30,000,000

-

300,000

-

ICICI Prudential Fixed Maturity Plan Series 59 - 1 year Plan B Cumulative Growth option Units of ` 10/- each (20,000,000 units purchased during the year)

20,000,000

-

200,000

-

ICICI Prudential Fixed Maturity Plan Series 59 - 1 year Plan F Cumulative Growth option Units of ` 10/- each (15,000,000 units purchased during the year)

15,000,000

-

150,000

-

1,467,910

1,467,910

250,000

250,000

ICICI Prudential Mutual Fund

ICICI Flexible Income Plan Premium - Growth option Units of ` 100/- each of Liquid Fund

74 | Financial Statements | Annual Report 2011

Schedules to Balance Sheet

SCHEDULE 6: INVESTMENTS (Contd.) Investments (Long term, unquoted, unless otherwise stated)

[` in Thousands (TINR)] Amount

Number 2011

2010

2011

2010

IDFC Mutual Fund IDFC Fixed Maturity Plan Yearly Series 33- Growth option

-

35,000,000

-

350,000

-

10,000,000

-

100,000

Units of ` 10/- each (35,000,000 units matured during the year) IDFC Fixed Maturity Plan Yearly Series 34- Growth option Units of ` 10/- each (10,000,000 units matured during the year) IDFC Fixed Maturity Plan - Yearly Series 46 - Growth option

25,000,000

-

250,000

-

45,000,000

-

450,000

-

25,000,000

-

250,000

-

20,000,000

-

200,000

-

-

45,000,000

-

450,000

45,000,000

-

450,000

-

10,000,000

-

100,000

-

40,000,000

-

400,000

-

25,000,000

-

250,000

-

40,000,000

-

400,000

-

20,000,000

-

200,000

-

20,000,000

-

200,000

-

20,000,000

-

200,000

-

TOTAL - D

11,865,045

11,858,854

Total - (A+B+C+D)

16,063,646

16,073,030

Cost

4,012,601

4,028,176

Market Value

6,602,617

7,158,995

12,051,045

12,044,854

Units of ` 10/- each (25,000,000 units purchased during the year) IDFC Fixed Maturity Plan - Yearly Series 52 - Growth option Units of ` 10/- each (45,000,000 units purchased during the year) IDFC Fixed Maturity Plan - Yearly Series 53 - Growth option Units of ` 10/- each (25,000,000 units purchased during the year) IDFC Fixed Maturity Plan - Yearly Series 59 Growth option Units of ` 10/- each (20,000,000 units purchased during the year) Tata Mutual Fund Tata Fixed Horizon Fund - Fixed Maturity Plan Series 27 Scheme A - Growth option Units of ` 10/- each (45,000,000 Units matured during the year) Tata Fixed Maturity Plan Series 34 Scheme B - Growth option Units of ` 10/- each (45,000,000 Units purchased during the year) Tata Fixed Maturity Plan Series 34 Scheme C- Growth option Units of ` 10/- each (10,000,000 units purchased during the year) Tata Fixed Maturity Plan Series 36 Scheme C- Growth option Units of ` 10/- each (40,000,000 units purchased during the year) Tata Fixed Maturity Plan Series 37 Scheme C- Growth option Units of ` 10/- each (25,000,000 units purchased during the year) State Bank Mutual Fund SBI Debt Fund Series 6 - 367 Days - Growth option Units of ` 10/- each (40,000,000 units purchased during the year) SBI Debt Fund Series 7 - 367 Days - Growth option Units of ` 10/- each (20,000,000 units purchased during the year) SBI Debt Fund Series 9 - 367 Days - Growth option Units of ` 10/- each (20,000,000 units purchased during the year) SBI Debt Fund Series 11 - 367 Days - Growth option Units of ` 10/- each (20,000,000 units purchased during the year)

Notes: 1. Aggregate of quoted Investments

2. Aggregate of unquoted Investments Cost

Annual Report 2011 | Financial Statements | 75

Schedules to Balance Sheet

[` in Thousands (TINR)]

SCHEDULE 7: INVENTORIES 2011 Raw materials and components

2010

3,285,593

2,062,028

Work-in-progress

1,513,383

988,643

Finished goods

2,641,233

1,627,892

Trade goods

3,707,905

3,147,387

Stores and spares

322,614

115,289

Loose tools

359,846

151,573

11,830,574

8,092,812

Inventory includes Goods in Transit TINR 2,086,126 (2010: TINR 1,790,664)

[` in Thousands (TINR)]

SCHEDULE 8: SUNDRY DEBTORS 2011

2010

Unsecured, considered good Debts outstanding for a period exceeding six months Other debts

261,295 9,230,817

325,245 6,884,414 9,492,112

Unsecured, considered doubtful Debts outstanding for a period exceeding six months Other debts

Less: Provision for doubtful debts

266,024 -

290,652 266,024

290,652

9,758,136

7,500,311

(266,024)

(290,652)

9,492,112

7,209,659

[` in Thousands (TINR)]

SCHEDULE 9: CASH AND BANK BALANCES 2011 Cash on hand [including Cheques on hand and remittance in transit TINR 374,923 (2010:TINR 280,270)]

7,209,659

2010 375,424

281,113

In current accounts

92,286

97,780

In dividend accounts

19,724

9,781

9,027,104

12,870,000

9,514,538

13,258,674

Balances with Scheduled Banks

In deposit accounts

76 | Financial Statements | Annual Report 2011

Schedules to Balance Sheet

SCHEDULE 10: OTHER CURRENT ASSETS (Unsecured considered good)

[` in Thousands (TINR)] 2011

2010

Interest accrued on Investments

243,553

242,068

Interest accrued on Deposits

259,541

347,146

503,094

589,214

SCHEDULE 11: LOANS AND ADVANCES [Refer Note 10 of Schedule 19] (Unsecured considered good, unless otherwise stated)

[` in Thousands (TINR)] 2011

2010

Advances recoverable in cash or in kind or for value to be received Secured Unsecured*

159,617

150,920

2,899,689

2,217,436

*[Includes due from subsidiary, MICO Trading Private Ltd TINR 132 (2010: TINR 132)] Inter corporate deposit Other deposits Inter corporate loan Advance Tax [Net of Provision TINR 12,700,824 (2010: TINR 10,712,105)] Balances with Customs, Port Trust and Excise Authorities etc.

3,059,306

2,368,356

3,600,000 278,769 3,140,000

3,280,000 252,337 1,630,000

350,864 593,338

276,097 563,716

11,022,277

8,370,506

[` in Thousands (TINR)]

SCHEDULE 12: CURRENT LIABILITIES 2011 Sundry creditors Dues of - Micro Enterprises and Small Enterprises [Refer Note 26 of Schedule 19] - Others

106,525 11,666,367

Advance from customers Unclaimed dividend # Other liabilities

2010

72,192 9,858,937 11,772,892 508,152 19,724 2,970,554

9,931,129 381,515 9,781 3,048,093

15,271,322

13,370,518

# There is no amount due to be credited to Investor Education and Protection Fund.

[` in Thousands (TINR)]

SCHEDULE 13: PROVISIONS 2011

2010

Proposed Final dividend (including dividend distribution tax)

1,824,629

1,464,555

Employee Benefits

1,887,648

1,703,771

Trade demand and Others Warranty

901,126

1,067,243

1,069,304

1,027,554

5,682,707

5,263,123

Annual Report 2011 | Financial Statements | 77

Schedules to Profit and Loss Account

SCHEDULE 14: INTEREST

[` in Thousands (TINR)] 2011

Interest income : Non trade Investments (Gross) [ Tax deducted at source Nil; (2010 : Nil)] Banks and other accounts (Gross) [ Tax deducted at source TINR 135,268 (2010:TINR 103,211)]

2010

270,052

204,826

1,576,679

978,792 1,846,731

Less : Interest expense : Banks and other accounts

4,271

39,339 4,271

39,339

1,842,460

1,144,279

SCHEDULE 15: OTHER INCOME

[` in Thousands (TINR)] 2011

Sale of scrap Dividend from non-trade investments - Current - Long term

2010 207,438

193,576 193,576

403,653

793,276 342,266 293,102 834,553 286,564 17,886 9,223

312,388 89,234 1,569,193 242,547 95,121 6,815

2,977,884

2,892,518

[` in Thousands (TINR)]

SCHEDULE 16: COST OF GOODS SOLD 2011

Less : Closing stock

173,567 230,793 172,860

Profit on sale/redemption of investments (Net) - Long term Rent Custom duty rebate Provisions/Liabilities no longer required written back Miscellaneous income Exchange Gain(Net) Profit on sale of fixed assets (Net)

Raw materials and components Opening stock Purchases

1,183,618

2,062,028 28,652,271 30,714,299 3,285,593

2010 1,530,799 22,183,091 23,713,890 2,062,028

27,428,706 Trade goods Opening stock Purchases Less : Closing stock

3,147,387 19,105,514 22,252,901 3,707,905

21,651,862 1,786,476 16,280,016 18,066,492 3,147,387

18,544,996 Change in the value of work-in-progress and finished goods Opening stock Work-in-progress Finished goods Closing stock Work-in-progress Finished goods

14,919,105

988,643 1,627,892 2,616,535

832,124 1,197,597 2,029,721

1,513,383 2,641,233 4,154,616

988,643 1,627,892 2,616,535 (1,538,081) 44,435,621

(586,814) 35,984,153

78 | Financial Statements | Annual Report 2011

Schedules to Profit and Loss Account

[` in Thousands (TINR)]

SCHEDULE 17: OPERATING EXPENSES 2011

2010

Personnel costs Salaries, wages, bonus, separation costs etc.

7,480,228

6,312,895

Contributions to provident and other funds

644,434

678,753

Welfare

836,702

1,033,071

Tools consumed

8,961,364

8,024,719

1,357,766

1,193,655

Stores consumed Power

743,933

637,543

1,009,847

865,410

Repairs and maintenance Machinery

821,481

855,236

Buildings

511,540

509,737

Others

226,825

Royalty and technical service fee

255,831 1,559,846

1,620,804

1,290,648

1,214,212

Rent

224,127

185,947

Rates, taxes and licences

177,536

232,053

Commission on sales

41,199

37,838

Insurance

58,969

44,640 1,356,926

Packing, freight and forwarding

1,636,714

Warranty and service expenses

330,497

824,615

Travelling and conveyance

797,056

649,802

Legal and other professional expenses

1,103,451

775,628

934,262

996,588

Advertisement and Sales Promotion expenses Miscellaneous expenses (Refer Note 15 of Schedule 19)

2,520,248

1,983,829

22,747,463

20,644,209

[` in Thousands (TINR)]

SCHEDULE 18: R & D EXPENSES/(INCOME)* 2011

2010

R & D Expenses: Materials Consumed Employee Cost Other Expenses

54,935

17,568

446,679

350,598

302,847

277,905

804,461

646,071

(659,323)

(376,808)

(248)

(75)

(659,571)

(376,883)

R & D Income: Income from services Other Income

* Relating to DSIR approved R & D facilities, proposed to be considered for certain Income Tax benefit.

Annual Report 2011 | Financial Statements | 79

Notes on accounts

SCHEDULE 19 : NOTES FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED DECEMBER 31, 2011. 1. Significant accounting policies : (a) Accounting basis and convention: The financial statements are prepared under historical cost convention in accordance with Generally Accepted Accounting Principle in India and comply in all material respects with the applicable accounting standards notified under section 211(3C) of the Companies Act, 1956 and the relevant provisions of the Companies Act,1956. (b) Revenue Recognition: Sale of goods is recognised on despatch of goods to customers and is recorded net of trade discounts, claims, etc., as considered appropriate. Interest on investments and deposits is recognised on a time proportion basis. Dividend income is accounted for when it is declared. Income from services is recognised on rendering of services based on agreements/ arrangements with the concerned parties. (c) Fixed assets: Fixed assets are stated at cost of acquisition or construction less accumulated depreciation. (d) Investments: Current Investments are stated at lower of cost and fair value. Long term Investments are stated at cost. A provision for diminution, if any, is made to recognise a decline, other than temporary, in the value of long term investments. Premium paid on acquisition of government bonds is amortised over the residual period of such bonds. (e) Depreciation: (i) Depreciation on fixed assets is provided using the written down value method based on the useful life as estimated by the management. The estimated useful life for various fixed assets is given below : Useful life (in years) Buildings : Residential

:

59

Factory/Office

:

29

Plant and Machinery : General

:

6

Data Processing Equipment

:

3

Furniture and Equipment

:

8

Motor Vehicles

:

5

In respect of specific assets including second hand machinery which are estimated to have a lower residual life than envisaged above, depreciation has been provided based on the estimated lower residual life, where required. (ii) In respect of assets which are not directly connected with the production activity such as Research and Development assets, pollution control and energy saving devices and low value assets not exceeding ` 15,000/per unit, depreciation is provided at 100% in the quarter of addition. (iii) Cost of application software is expensed off on purchase. (iv) In respect of additions, depreciation is provided on pro-rata basis from the quarter of addition and in respect of disposals, the same is provided upto the quarter prior to disposal. (v) The aggregate depreciation so provided in the accounts is not less than the depreciation which would have been provided had the rates specified in Schedule XIV of the Companies Act, 1956, been adopted. (vi) Cost of leasehold land is amortized over the lease term.

80 | Financial Statements | Annual Report 2011

Notes on accounts

(f) Inventories: Inventories are valued at lower of cost and net realisable value. Cost is generally ascertained on weighted average basis. In case of work-in-progress and finished goods, appropriate overheads are included. Obsolete / slow moving inventories are adequately provided for. Excise duty on finished goods lying in factories and customs duty on raw materials in bonded warehouses are considered for valuation of inventories, as applicable. Purchased goods in transit are accounted at cost. (g) Employee Benefits: (i) Short term employee benefits: All employee benefits falling due wholly within twelve months of rendering the services are classified as short term employee benefits, which include benefits like salaries, wages, short term compensated absences and performance incentives and are recognised as expenses in the period in which the employee renders the related service. (ii) Post-employment benefits: Contributions towards Superannuation Fund, Pension Fund and government administered Provident Fund are treated as defined contribution schemes. Such contributions are recognised as expenses in the period in which the employee renders related service. In respect of certain employees, Provident Fund contributions are made to Trusts administered by the Company, which is in nature of defined benefit plan. The interest rate payable to the members of these Trusts shall not be lower than the statutory rate of interest declared by the Central Government under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 and shortfall, if any, shall be made good by the Company. In respect of contributions made to government administered Provident Fund, the Company has no further obligations beyond its monthly contributions. The Company also provides for post employment defined benefit in the form of gratuity. The cost of providing benefit is determined using the projected unit credit method, with actuarial valuation being carried out at each balance sheet date. Actuarial gains and losses in respect of the same are charged to the Profit and Loss Account. (iii) Other Long Term Employee Benefits: All employee benefits (other than post-employment benefits and termination benefits) which do not fall due wholly within twelve months after the end of the period in which the employees render the related service, mainly including long term compensated absences, service awards, death relief benefits are determined based on actuarial valuation carried out at each balance sheet date. Estimated liability on account of long term benefits and defined benefit plans is discounted to the present value, using the yield on government bonds as the discounting rate, as on the date of the balance sheet. Actuarial gains and losses in respect of the same are charged to the Profit and Loss Account. (h) Foreign currency transactions: Foreign currency transactions are recorded at the rate of exchange prevailing on the date of the transactions. At the year end, all the monetary assets and liabilities denominated in foreign currency are restated at the closing exchange rates. Exchange differences resulting from the settlement of such transactions and from the translation of such monetary assets and liabilities are recognised in the Profit and Loss Account. Forward exchange contracts outstanding as at the year end on account of firm commitment/ highly probable forecast transactions are marked to market and the resultant loss, if any, is recognised in the Profit and Loss Account. (I) Leases: Assets acquired under finance leases are capitalised at the lower of the fair value of the leased assets at the inception of the lease term and the present value of minimum lease payments. Lease payments are apportioned between the finance charge and the reduction of the outstanding liability. The finance charge is allocated to periods during the lease term at a constant periodic rate of interest on the remaining balance of the liability. Operating lease expense/ income is recognised in the Profit and Loss Account on a straight line basis over the lease term. (j) Income Tax : (i) Current Taxation: Provision is made for income tax annually based on the tax liability computed after considering tax allowances and exemptions.

Annual Report 2011 | Financial Statements | 81

Notes on accounts

(ii) Deferred Taxation: Deferred income tax is provided, on all timing differences at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Deferred tax assets and liabilities are measured at the tax rates that have been enacted or substantively enacted as on the balance sheet date. (k) Impairment of Assets: At each balance sheet date, the Company assesses whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the recoverable amount. If the carrying amount of the asset exceeds its recoverable amount an impairment loss is recognised in the Profit and Loss Account to the extent the carrying amount exceeds recoverable amount. (l) Provisions: Provisions are recognised when the Company has a present obligation as a result of past events, for which it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate of the amount can be made. (m) Research and Development: Capital expenditure on Research & Development is capitalized as fixed assets and depreciated in accordance with depreciation policy of the Company. Revenue expenditure incurred in research phase is expensed as incurred. Development expenditure is capitalized as an internally generated intangible asset only if it meets the recognition criteria under Accounting Standard 26 on Intangible Assets, which inter-alia includes demonstration of technical feasibility, generation of future economic benefits etc. Expenditure that cannot be distinguished between research phase and development phase is expensed as incurred. 2.

Disclosure on Retirement Benefits as required in Accounting Standard (AS) 15 on "Employee Benefits" are given below: (a) Post Retirement Benefit- Defined Contribution Plans The Company has recognised an amount of TINR 222,990 (2010:TINR 213,526) as expense under the defined contribution plans in the Profit and Loss Account. (b) Post Retirement Benefit- Defined Benefit Plans The Company makes annual contributions to the Mico Employees' Gratuity Fund and makes monthly contributions to Mico Workmen (Bangalore Works & Sales Houses) Provident Fund Trust, a funded defined benefit plan for qualifying employees. The Gratuity Scheme provides for lumpsum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to 15 days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs only upon completion of five years of service, except in case of death or permanent disability. The Provident Fund Scheme provides for lumpsum payment/transfer to the member employees at retirement, death while in employment or on termination of employment of an amount equivalent to the credit standing in his account maintained by the trusts. The present value of the defined benefit obligation and the related current service cost are measured using the projected unit credit method with actuarial valuation being carried out at each balance sheet date. [` in Thousands (TINR)] Provident Fund 2011 2010

Gratuity 2011

2010

(i) Reconciliation of Opening and Closing balances of the present value of the defined benefit obligation: 4,061,953

3,450,277

2,290,943

1,990,261

Service Cost

Obligations at the beginning of the year

193,677

227,743

215,604

247,803

Contributions from Plan Participants

516,592

502,522

-

-

Interest Cost

348,304

264,053

200,779

156,893

(383,817)

(380,735)

(120,142)

(106,629)

46,152

(1,907)

(4,353)

(191)

-

-

-

2,806

4,782,861

4,061,953

2,582,831

2,290,943

Benefits Settled Actuarial (gain)/loss Past Service Cost Obligations at the end of the year

82 | Financial Statements | Annual Report 2011

Notes on accounts

[` in Thousands (TINR)] Provident Fund 2011 2010

Gratuity 2011

2010

(ii) Change in Plan Assets: Plan assets at fair value at the beginning of the year Expected return on plan assets Actuarial gain/(loss) Asset distributed on settlements Contributions

4,270,586

3,645,928

2,014,099

373,242

317,700

185,548

1,825,054 150,264

318

(1,666)

17,814

(21,343)

-

-

-

-

729,368

689,359

215,340

166,753

Benefit Settled

(383,817)

(380,735)

(120,142)

(106,629)

Plan assets at fair value at the end of the year

4,989,697

4,270,586

2,312,659

2,014,099

(iii) Reconciliation of present value of the obligation and the fair value of the plan assets: Present value of obligation at the end of the year

4,782,861

4,061,953

2,582,831

2,290,943

Fair value of plan asset at the end of the year

4,989,697

4,270,586

2,312,659

2,014,099

(Surplus)/ Deficit recognised in the Balance Sheet (*)

(206,836)

(208,633)

270,172

276,844

(*) Surplus relating to Provident Fund is not recognised in the Balance Sheet as the plan assets belong to the Trusts.

(iv) Expenses recognised in the Profit and Loss Account: Service Cost

193,677

227,743

215,604

247,803

Interest Cost

348,304

264,053

200,779

156,893

(373,242)

(317,700)

(185,548)

(150,264)

45,834

(241)

(22,167)

21,152

-

-

-

2,806

214,573

173,855

208,668

278,390

Expected return on plan assets Actuarial (gain)/ loss Past Service Cost Net Cost

Provident Fund 2011 2010 (v) Investment Details:

% Invested

% Invested

Gratuity 2011 % Invested

2010

% Invested

Government of India Securities

29.69

32.56

17.79

21.99

State Government Securities

20.17

20.70

34.66

29.78

Public Sector Securities

39.36

41.17

34.82

32.88

3.40

3.95

-

0.62

-

-

0.42

0.71

Private Sector Securities Treasury Bills Special Deposit Scheme Total

(vi) Actual Return on Plan Assets

7.38

1.62

12.31

14.02

100.00

100.00

100.00

100.00

9.17%

8.36%

9.86%

6.95%

Annual Report 2011 | Financial Statements | 83

Notes on accounts

[` in Thousands (TINR)] Provident Fund 2011 2010

Gratuity 2011

2010

(vii)Assumptions: Discount factor (Note 1 below)

9.0%

8.1%

9.0%

8.1%

Estimated Rate of return on plan assets (Note 2 below)

8.4%

8.4%

9.0%

8.1%

Attrition rate

2.0%

2.0%

2.0%

2.0%

Rate of escalation in salary per annum (Note 3 below)

9.3%

9.3%

9.3%

9.3%

60

58 / 60

60

58 / 60

Retirement Age

(viii) As per the best estimate of the management, contribution expected to be paid to the Mico Employees Gratuity Fund is TINR 228,378 (2010:TINR 199,112) and to the Provident Fund Trusts is TINR 236,030 (2010: TINR 186,836) plans during the year ending December 31, 2012. (ix) Net Asset/ (Liability) recognised in Balance Sheet in respect on Gratuity (including experience adjustment impact): 2011

2010

2009

2008

2007

Present value of defined benefit obligation

2,582,831

2,290,943

1,990,261

1,787,694

1,622,800

Fair value of plan assets

2,312,659

2,014,099

1,825,054

1,671,163

1,611,100

270,172

276,844

165,207

116,531

11,700

Experience adjustment of Plan Assets [Gain/ (Loss)]

17,814

(21,343)

(4,420)

26,300

5,400

Experience adjustment of Plan Obligation [(Gain)/ Loss]

(4,353)

(191)

17,056

51,676

(96,719)

(Surplus)/ Deficit recognised in the Balance Sheet

(x) Net Asset/ (Liability) recognised in Balance Sheet in respect on Provident Fund (including experience adjustment impact): 2011

2010

Present value of defined benefit obligation

4,782,861

4,061,953

Fair value of plan assets

4,989,697

4,270,586

(Surplus)/ Deficit recognised in the Balance Sheet

(206,836)

(208,633)

Experience adjustment of Plan Assets [Gain/ (Loss)] Experience adjustment of Plan Obligation [(Gain)/ Loss]

318

(1,666)

46,152

(1,907)

2011

2010

9.0%

8.1%

(c) Long term compensated absences - Principal Actuarial Assumptions:

Discount factor (Note 1 below) Attrition rate

2.0%

2.0%

Rate of escalation in salary per annum (Note 3 below)

9.3%

9.3%

60

58 / 60

Retirement Age Notes:

1) The discount rate is based on the prevailing market yield on Government Bonds as at the balance sheet date for the estimated term of obligations. 2) The expected return on plan assets is determined considering several applicable factors mainly the composition of the plan assets held, assessed risks of asset management, historical results of the return on plan assets and the Company's policy for plan asset management. 3) The estimate of future salary increases considered in actuarial valuation takes into account inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

84 | Financial Statements | Annual Report 2011

Notes on accounts

3. Segment Information : The Company's operations predominantly relate to manufacturing and trading of automotive products. The Company is also manufacturing industrial equipments and consumer goods which are non-automotive products. The risks and rewards associated with these two businesses are significantly different. Therefore, the primary segment consists of "Automotive Products" and "Others" which are essentially non-automotive products. Secondary segment information is organised in two geographical segments, namely "India" and "Outside India". The Accounting principles and policies adopted in the preparation of the financial statements are also consistently applied to record income/ expenditure and assets/ liabilities in individual segments. These are as set out in the note on significant accounting policies. The inter-segment sales are recorded at cost. a) Details of Primary Segment Business Segment

[` in Thousands (TINR)]

Automotive Products 2011

Others

2010

Eliminations

2011

2010

2011

Consolidated Total

2010

2011

2010

Revenue External Sales Inter-Segment Sales Total Revenue

71,566,292

60,083,011

7,728,412

6,222,023

-

-

79,294,704

-

-

709,158

341,645

(709,158)

(341,645)

-

66,305,034 -

71,566,292

60,083,011

8,437,570

6,563,668

(709,158)

(341,645)

79,294,704

66,305,034

12,775,240

10,706,432

789,340

369,612

-

-

13,564,580

11,076,044

Result Segment Result Unallocated Corporate income/(expenses) - Net Operating Profit Add: Interest Income Less:Interest Expenses Less: Income Taxes (Net) Net Profit

332,814

(192,411)

13,897,394

10,883,633

1,846,731

1,183,618

4,271

39,339

4,514,270

3,438,862

11,225,584

8,589,050

33,675,978

23,816,184

Other Information Segment Assets

29,938,489

21,093,968

3,737,489

2,722,216

-

-

37,633,821

38,561,760

-

-

71,309,799

62,377,944

-

-

19,117,666

16,692,361

4,907,783

4,705,169

-

-

24,025,449

21,397,530

Unallocated Corporate Assets Total Assets Segment Liabilities

16,446,305

14,689,634

2,671,361

2,002,727

Unallocated Corporate Liabilities Total Liabilities Capital Expenditure

5,717,864

2,185,022

259,395

157,457

Depreciation

2,405,891

2,397,021

45,392

36,405

-

-

-

-

Non Cash Expenses other than Depreciation

(b) Details of Secondary Segment Revenue from geographical segment is based on location of its customers. Total carrying amount of assets and the total cost incurred during the period to acquire fixed assets is based on geographical locations of the assets. [` in Thousands (TINR)] Geographical Segment

Sales

Carrying cost of assets

Capital expenditure

2011

2010

2011

2010

2011

2010

India

68,950,560

57,844,316

69,436,769

61,187,017

6,587,236

3,021,270

Outside India

10,344,144

8,460,718

1,873,030

1,190,927

-

-

Total

79,294,704

66,305,034

71,309,799

62,377,944

6,587,236

3,021,270

Annual Report 2011 | Financial Statements | 85

Notes on accounts

4. Related Party Transactions: Holding Company : Robert Bosch GmbH, Germany Other related parties where transactions have taken place during the year : Fellow Subsidiary Companies: Beissbarth GmbH, Germany

Moehwald GmbH, Germany

Bosch (China) Investment Ltd., China

Moeller & Devicon A/S, Denmark

Bosch Automotive Diagnostics Equipment (Beijing) Ltd., China

Ohta Iron Works Co., Ltd., Japan

Bosch Automotive Diesel Systems Co., Ltd., China

P.T. Robert Bosch, Indonesia

Bosch Automotive Electronics India Private Ltd., India

Precision Seals Manufacturing Ltd., India

Bosch Automotive Products (Changsha) Co., Ltd., China

Robert Bosch (Australia) Pty. Ltd., Australia

Bosch Automotive Products (Nanjing) Co., Ltd., China

Robert Bosch (France) S.A.S., France

Bosch Automotive Products (Suzhou) Co., Ltd., China

Robert Bosch (Malaysia) SDN. BHD., Malaysia

Bosch Automotive Thailand Co. Ltd., Thailand

Robert Bosch (Pty.) Ltd., South Africa

Bosch Car Multimedia Portugal, S.A., Portugal

Robert Bosch (South East Asia) Pte. Ltd., Singapore

Bosch Chassis Systems India Ltd., India

Robert Bosch AG, Austria

Bosch Corporation, Japan

Robert Bosch Argentina Industrial S.A., Argentina

Bosch Diesel s.r.o., Czech Republic

Robert Bosch Car Multimedia GmbH, Germany

Bosch Electrical Drives Co., Ltd., Korea

Robert Bosch Company Ltd., China

Bosch Electrical Drives India Private Ltd., India

Robert Bosch Elektronika Gyártó Kft., Hungary

Bosch Engineering GmbH, Germany

Robert Bosch Elektrowerkzeuge GmbH, Germany

Bosch Lawn and Garden Ltd., Great Britain

Robert Bosch Energy and Body Systems Kft., Hungary

Bosch Management Support GmbH, Germany

Robert Bosch Engineering and Business Solutions Ltd., India

Bosch Packaging Services AG, Switzerland

Robert Bosch España Fábrica Madrid S.A., Spain

Bosch Packaging Technology (Hangzhou) Co., Ltd., China

Robert Bosch España Fábrica Treto S.A., Spain

Bosch Packaging Technology B.V., Netherlands

Robert Bosch España Gasoline Systems S.A., Spain

Bosch Packaging Technology SA, Switzerland

Robert Bosch España, S.L.U., Spain

Bosch Packaging Technology, Inc., United States

Robert Bosch Fahrzeugelektrik Eisenach GmbH, Germany

Bosch Power Tools (China) Ltd., China

Robert Bosch Fuel Systems LLC, United States

Bosch Rexroth (India) Ltd., India

Robert Bosch Inc., Philippines

Bosch Rexroth AG, Germany

Robert Bosch Korea Diesel Ltd., Korea

Bosch Rexroth Corporation, United States

Robert Bosch Korea Ltd., Korea

Bosch Rexroth Electric Drives and Controls GmbH, Germany

Robert Bosch LLC, United States

Bosch Rexroth Ltda., Brazil

Robert Bosch Ltd., Great Britain

Bosch Rexroth Mechatronics GmbH, Germany

Robert Bosch Ltd., Thailand

Bosch Rexroth Otomasyon Sanayi ve Ticaret A.S., Turkey

Robert Bosch Ltda., Brazil

Bosch Sanayi ve Ticaret A.S., Turkey

Robert Bosch Middle East FZE, United Arab Emirates

Bosch Security Systems B.V., Netherlands

Robert Bosch Packaging Technology B.V., Netherlands

Bosch Security Systems Inc., United States

Robert Bosch Packaging Technology Inc., United States

Bosch Security Systems Pty. Ltd., Australia

Robert Bosch Power Tools SDN. BHD., Malaysia

Bosch Sicherheitssysteme Engineering GmbH, Germany

Robert Bosch S.p.A., Italy

Bosch Sicherheitssysteme GmbH, Germany

Robert Bosch Sdn. Bhd., Malaysia

Bosch Solar Thin Film GmbH, Germany

Robert Bosch Tool Corporation, United States

Bosch Termotechnologia, S.A., Portugal

Robert Bosch Vietnam Co., Ltd., Vietnam

Bosch Trading (Shanghai) Co., Ltd., China

Robert Bosch, S. de R.L. de C.V., Mexico

BSH Home Appliances Private Limited, India

Robert Bosch, spol. s.r.o., Czech Republic

BT Magnet-Technologie GmbH, Germany

Scintilla AG, Switzerland

Centro Studi Componenti per Veicoli S.p.A., Italy

sia Abrasives Industries AG, Switzerland

erphi electronic GmbH, Germany

SICAM S.r.l., Italy

ETAS Automotive India Private Ltd., India

Tecnologie Diesel e Sistemi Frenanti S.p.A., Italy

ETAS Entwicklungs- und Applikationswerkzeuge für elektronische Systeme GmbH, Germany

United Automotive Electronic Systems Co., Ltd., China

MIVIN Engineering Technologies Private Ltd., India

Weifu High Technology Co., Ltd., China

Subsidiary Company : MICO Trading Private Limited, India Joint Venture : MHB Filters India Private Limited, India Other entity under the control of the company : BOSCH India Foundation, India Key Management Personnel: Mr. V.K.Viswanathan, Dr. Manfred Duernholz and Mr. Soumitra Bhattacharya (from July 1, 2011) Note : The information disclosed is based on the names of the parties as identified by the management, which has been relied upon by the auditors.

86 | Financial Statements | Annual Report 2011

Notes on accounts

[` in Thousands (TINR)] Particulars

Sales

Holding Company

Fellow Subsidiaries

5,738,453 (4,576,499)

3,655,949 (3,207,212)

12,002 (7,929)

9,406,404 (7,791,640)

314,410 (311,134)

347,151 (166,902)

8,258 (3,285)

669,819 (481,321)

Services rendered (including reimbursements)

Subsidiary

Joint Venture

Key Management Personnel

Other entity under the control of the Company

Total

Rent Income

342,253 (312,376)

342,253 (312,376)

Interest Income

271,579 (129,475)

271,579 (129,475)

1,702,748 (274,946)

93,041 (81,509)

1,795,789 (356,455)

11,030,500 (8,982,244)

6,552,243 (5,890,921)

1,258,681 (1,200,395)

31,967 (13,817)

1,290,648 (1,214,212)

Professional, consultancy and others

1,103,964 (866,200)

740,657 (590,310)

1,844,621 (1,456,510)

Dividend paid (Cash basis)

2,793,678 (670,483)

Purchases of : Fixed Assets Goods Services received: Royalty and Technical Service fee

660,645 (601,715)

18,243,388 (15,474,880)

2,793,678 (670,483)

Donation expenses

20,000 (21,473)

Inter Corporate Loan given during the year

1,510,000 (830,000)

Investments in Equity shares

(14,250)

(15,150)

3,140,000 (1,630,000)

Sundry Debtors

717,708 (353,009)

3,140,000 (1,630,000)

1,144,490 (856,221)

Other Advances Receivable Sundry Creditors

1,510,000 (830,000) (900)

Inter Corporate Loan Receivable

20,000 (21,473)

4,847 (3,190)

1,867,045 (1,212,420)

132 (132) 4,295,839 (2,642,150)

Advance to suppliers

2,045,038 (1,620,886)

132 (132) 33,802 (53,886)

20,178 (21,578)

(432,052)

Managerial Remuneration: Mr. V.K. Viswanathan Dr. Manfred Duernholz Mr. Soumitra Bhattacharya (from July 1, 2011) Rent expense Mr. V.K. Viswanathan Unpaid Bonus/ Commission as at year end Loan and Advances transactions : Loan/Advances given during the year (*) Recovery during the year Amount outstanding at the year end

6,394,857 (4,338,500) (432,052)

35,150 (32,026)

35,150 (32,026)

34,049 (33,707)

34,049 (33,707)

5,954 (-)

5,954 (-)

363 (363)

363 (363)

34,565 (32,140)

34,565 (32,140)

4,458 (-)

4,458 (-)

629 (480)

629 (480)

7,571 (3,742)

7,571 (3,742)

(*) includes TINR 3,120 (2010: Nil) relating to loan outstanding at the time of becoming Key Management Personnel. Note: Figures in bracket relate to previous year.

Names of fellow subsidiaries having transaction value in excess of 10% in line transactions

[` in Thousands (TINR)]

Particulars

Name of the fellow Subsidiary

Sales

Robert Bosch Korea Diesel Ltd., Korea

Services rendered (including reimbursements

Robert Bosch Engineering and Business Solutions Ltd., India

113,208

Rent Income

Robert Bosch Engineering and Business Solutions Ltd., India

293,457

Bosch Automotive Electronics India Pvt Ltd., India Interest Income Services received: Professional, consultancy and others Inter Corporate Loan given during the year

Bosch Rexroth (India) Ltd., India

2011 1,190,728

48,796 232,203

Robert Bosch Engineering and Business Solutions Ltd., India

392,668

Bosch Rexroth India Ltd., India

1,250,000

Bosch Automotive Electronics India Pvt Ltd., India

240,000

Annual Report 2011 | Financial Statements | 87

Notes on accounts

5. Information on leases as per Accounting Standard 19 on “Accounting for Leases”: (a) Finance Lease : The company does not have any item covered under finance lease which needs disclosure as per Accounting Standard 19 - "Accounting for Leases". (b) Operating Lease Expenses : The Company has various operating leases for equipments, office facilities, guest houses and residential premises for employees that are renewable on a periodic basis. Rental expenses for operating leases recognised in the Profit and Loss Account for the year amounts to TINR 224,127 (2010 : TINR 185,947). Disclosure in respect of Non-Cancellable Lease is as given below:

[` in Thousands (TINR)]

Future minimum lease payments

2011

2010

- Not later than 1 year

26,762

16,178

- Later than 1 year and not later than 5 years

34,075

16,544

-

-

- Later than 5 years (c) Operating Lease Income :

Rental income received during the year in respect of operating lease is TINR 342,266 (2010 : TINR 312,388). Details of assets given on operating lease as of December 31, 2011 are as below: [` in Thousands (TINR)] Gross Block

Buildings Plant and Machinery Furniture and Equipment Total

Accumulated Depreciation

Written down value

Depreciation for the year

2011

2010

2011

2010

2011

2010

2011

2010

715,425 380,124 83,278

706,827 358,838 83,278

434,107 359,586 80,226

395,968 323,468 78,700

281,318 20,538 3,052

310,859 35,370 4,578

31,258 14,832 1,526

34,540 25,549 1,860

1,178,827

1,148,943

873,919

798,136

304,908

350,807

47,616

61,949

6. Earnings Per Share :

[` in Thousands (TINR)] 2011

2010

Profit attributable to equity shareholders

11,225,584

8,589,050

Weighted average number of Equity Shares outstanding during the year

31,398,900

31,398,900

Nominal value of Equity Shares (`) Basic and Diluted Earnings per Share (`)

10

10

358

274

7. Deferred tax asset (net) is in respect of :

[` in Thousands (TINR)] 2011

2010

(a) Difference between books and Income tax written down value of depreciable fixed asset.

1,661,329

1,597,086

(b) Expenses debited to the Profit and Loss Account in a year but allowable as deductible expenses for tax purposes in the subsequent years as reduced by the claims allowable in the current year in respect of such expenses on a payment basis.

614,671

584,914

2,276,000

2,182,000

88 | Financial Statements | Annual Report 2011

Notes on accounts

8. Details of Company’s share in the joint venture Assets, Liabilities, Income and Expenses as required by Accounting Standard 27 “Financial Reporting of Interests in Joint Ventures” is indicated below: Name of the Joint Venture

:

MHB Filter India Private Limited.

Country of Incorporation

:

India

Percentage of ownership interest

:

25% [` in Thousands (TINR)] 2011

2010

63,575

74,145

Assets Fixed Assets Capital Work in Progress

-

1,039

3

8,186

7,663

29,991

Inventories

23,800

22,901

Sundry Debtors

24,097

14,311

Investments Deferred Tax Assets Current Assets, Loans and Advances

Cash and Bank Balances

5,418

6,477

Loans and Advances

6,787

8,092

44,639

39,243

699

611

184,702

141,859

2,949

2,332

Cost of Goods Sold

130,208

112,541

Operating Expenses

66,115

52,619

8,287

8,599

Liabilities Current Liabilities and Provisions Current Liabilities Provisions Income Sales Other Income Expenditure

Depreciation Other Matters Contingent Liabilities Capital Commitment

-

-

2,280

5,107

9. Disclosures under Accounting Standard 29 on “Provisions, Contingent Liabilities and Contingent Assets” [` in Thousands (TINR)] Description

As at 31.12.2010

Additions during the year

Utilised/Reversed during the year

As at 31.12.2011

Trade Demand and Others (Note 1 below) 1,067,243 (892,474)

434,439 (780,472)

600,556 (605,703)

901,126 (1,067,243)

Warranty (Note 2 below)

330,497 (824,615)

288,747 (959,301)

1,069,304 (1,027,554)

1,027,554 (1,162,240)

Notes: 1. Nature of the provision has not been given on the grounds that it can be expected to prejudice the interests of the company. Due to the very nature of such costs, it is not possible to estimate the timing / uncertainties relating to their outflows. 2. Warranty estimates are established using historical information on the nature, frequency and average cost of warranty claims and also management estimates regarding possible future outflow on servicing the customers for any corrective action in respect of product failure which is generally expected to be settled within a period of 2 to 3 years. 3. Figures in bracket relate to previous year.

Annual Report 2011 | Financial Statements | 89

Notes on accounts

10. Disclosure under Clause 32 of Listing Agreement : Loans and Advances (Schedule 11) includes :

[` in Thousands (TINR)] Outstanding

Inter Corporate Loan - Bosch Rexroth (India) Ltd., - MIVIN Engg. Technologies Private Ltd., - Bosch Automotive Electronics India Pvt. Ltd. Non/Low interest bearing loans to employees/directors

Maximum amount outstanding

2011

2010

2011

2010

2,750,000 150,000 240,000

1,500,000 130,000 -

2,750,000 150,000 240,000

1,500,000 130,000 -

669,753

594,901

713,583

594,901

[` in Thousands (TINR)] 2011 11.

2010

Contingent liabilities : (a) Claims against the Company not acknowledged as debts: (i) Excise / Customs

Net of tax Gross

235 352

235 352

(ii) Trade Demands

Net of tax Gross

-

155,603 233,000

(b) Guarantees given by Banks on behalf of the Company

215,692

256,380

(c) Bills Discounted not matured

650,363

845,620

(d) Certain industrial disputes are pending before various judicial authorities - amounts not ascertainable. 12.

Estimated amount of contracts remaining to be executed on capital accounts and not provided for (net of advances)

2,521,192

1,115,504

13.

(a) Advances include dues from directors and an officer of the Company

8,881

5,232

(b) Maximum amount due from directors and an officer of the Company at any time during the year

10,404

6,471

90 | Financial Statements | Annual Report 2011

Notes on accounts

[` in Thousands (TINR)] 2011 14.

2010

(a) Managerial remuneration : (i) Remuneration to wholetime directors : Salary

32,790

27,640

Bonus/Commission

34,565

32,140

4,846

3,925

Contribution to provident and other funds * Other perquisites

(ii) Directors’ sitting fee (iii) Commission to non-wholetime directors

*

2,952

2,028

75,153

65,733

250

180

2,595

2,425

77,998

68,338

Provision for / contribution to group gratuity which is based on actuarial valuation on an overall company basis is excluded.

[` in Thousands (TINR)] 2011

2010

(b) Computation of Net Profit in accordance with Section 349 of the Companies Act, 1956. Profit before taxation Add :

15,739,854

Managerial remuneration Depreciation charged in the accounts Net profit/ (loss) on fixed assets sold or discarded under Section 350

Less:

Depreciation as per Section 350 Profit on sale of fixed assets (Net) Profit/ (loss) on sale of investments (Net)

Net profit Bonus/ Commission to Wholetime directors Percentage of Net profit Commission to Non-wholetime directors Percentage of Net profit [Commission to Non-Wholetime directors restricted to 1% of Net profit or TINR 6,000 (2010 : TINR 6,000) whichever is lower]

12,027,912

77,998

68,338

2,578,404

2,539,651

(34,293)

(33,511)

18,361,963

14,602,390

2,247,866

2,058,788

9,223

6,815

793,276

3,050,365

2,065,603

15,311,598

12,536,787

34,565

32,140

0.23

0.26

2,595

2,425

0.02

0.02

Annual Report 2011 | Financial Statements | 91

Notes on accounts

15. Miscellaneous expenses include :

[` in Thousands (TINR)] 2011

.

2010

(a) Remuneration to auditors : (Excluding Service tax) Statutory Audit fee

4,800

4,230

Taxation matters and Tax audit fees

1,350

1,372

Other services

2,900

1,620

Reimbursement of expenses (b) Donations (c)

Bad debts written off

550

550

20,527

22,316

109,552

49,067

(d) Provision for doubtful debts

159,495

149,439

(e)

Cash discount to customers

280,433

261,241

(f)

Premium paid on investment amortised

15,573

10,097

16. Particulars of Gross Sales :

[` in Thousands (TINR)] 2011

Products

2010

Unit

Quantity

Value

Quantity

Value

Fuel Injection Equipment

Pcs.('000)

4,377

28,553,583

3,695

22,640,085

Injectors, Nozzles and Nozzle holders

Pcs.('000)

23,032

19,839,259

21,496

16,332,919

Auto Electricals

Pcs.('000)

2,043

5,209,040

1,451

3,492,008

Portable Electric Power tools

Pcs.('000)

684

3,118,593

561

2,275,051

Filter and Filter Inserts

Pcs.('000)

42,929

3,255,545

38,535

2,909,010

Spark Plugs

Pcs.('000)

31,715

1,084,488

26,032

847,583

Security Systems

Pcs.('000)

432

1,183,589

365

999,911

Kilo litres

15,022

1,588,470

12,917

1,123,929

Lubricating oil Spares and Components : - Fuel Injection Equipment - Portable Electric Power Tools

15,629,553

14,879,086

2,541,490

2,279,648

- Auto Electricals

1,522,019

1,432,485

Others

1,806,011

1,509,984

85,331,640

70,721,699

Notes: 1) The quantitative information of sale of spares and components and others have not been given as these comprise of numerous items. 2) The above quantity is after adjusting for free issues etc.

92 | Financial Statements | Annual Report 2011

Notes on accounts

17. Purchase of Trade goods :

[` in Thousands (TINR)]

Products

Unit

2011 Quantity

2010 Value

Quantity

Value

Fuel Injection Equipment

Pcs ('000)

146

1,815,124

92

1,216,559

Portable Electric Power Tools

Pcs ('000)

304

1,648,045

214

1,540,638

Filter and Filter Inserts

Pcs ('000)

43,377

2,242,833

39,059

2,142,129

Security Systems

Pcs ('000)

471

873,652

380

874,398

Kilo litres

14,521

1,187,923

13,194

886,712

Lubricating oil Spares and Components - Fuel Injection Equipment

8,403,186

6,956,862

- Portable Electric Power Tools

1,765,826

1,489,258

Others

1,168,925

1,173,460

19,105,514

16,280,016

Note: 1. The quantitative information of stock of spares and components and others have not been given as these comprise of numerous items.

18. Installed Capacity and Production : Installed Capacity Products

Unit

2011

Production

2010

2011

2010

Fuel Injection Equipment

Pcs. (`000)

6,114

4,290

4,325

3,651

Injectors, Nozzles and Nozzle Holders

Pcs. (`000)

25,750

21,780

23,770

21,452

Auto Electricals

Pcs. (`000)

3,436

3,187

2,078

1,489

Portable Electric Power Tools

Pcs. (`000)

594

593

427

362

Spark Plugs

Pcs. (`000)

32,900

27,300

32,836

25,879

Special Purpose Machines

Nos.

146

76

118*

38*

Packaging Machines

Nos.

260

143

260

143

Pcs. (`000)

31,903

27,170

26,109

24,156

Spares and Components

Notes: 1. 2.

Installed capacity is as certified by the management and relied upon by the auditors as this is a technical matter. A part of installed capacity of spares and components is used as OE fitment in Fuel injection equipments. * Includes use for captive consumption.

Annual Report 2011 | Financial Statements | 93

Notes on accounts

19. Opening and Closing Stocks of Manufactured and Trade goods :

[` in Thousands (TINR)] 2011

Products

2011

Closing Stock

Opening Stock

Unit

Quantity

Value

Quantity

Value

Fuel Injection Equipment

Pcs ('000)

209 (115)

1,174,871 (603,150)

115 (67)

603,150 (316,583)

Injectors, Nozzles and Nozzle holders

Pcs ('000)

1,596 (858)

796,519 (331,088)

858 (902)

331,088 (284,143)

Auto Electricals

Pcs ('000)

133 (98)

243,798 (192,574)

98 (60)

192,574 (97,061)

Portable Electric Power Tools

Pcs ('000)

157 (110)

399,847 (321,699)

110 (95)

321,699 (360,616)

Filter and Filter Inserts

Pcs ('000)

3,128 (2,680)

196,339 (170,860)

2,680 (2,156)

170,860 (108,561)

Spark Plugs

Pcs ('000)

2,144 (1,023)

55,728 (27,262)

1,023 (1,176)

27,262 (27,276)

Security Systems

Pcs ('000)

86 (47)

449,479 (360,714)

47 (32)

360,714 (31,671)

Kilo litres

1,071 (1,572)

92,127 (108,820)

1,572 (1,295)

108,820 (70,267)

Lubricating oil

Spares and Components - Fuel Injection Equipment

Others

Goods in transit

Excise Duty on above

771,896 (601,874)

601,874 (461,438)

675,894 (776,563)

776,563 (263,725)

1,029,672 (1,008,794)

1,008,794 (775,121)

462,968 (271,881)

271,881 (187,611)

6,349,138 (4,775,279)

4,775,279 (2,984,073)

Notes: 1. The quantitative information of stock of spares and components and others have not been given as these comprise of numerous items. 2. Net of shortage/excess/adjustment etc. 3. Figures in brackets relate to the previous year.

94 | Financial Statements | Annual Report 2011

Notes on accounts

20. Consumption of raw materials and components :

[` in Thousands (TINR)] 2011 Unit

Quantity

Tonnes

3,688

Components Steel

2010 Value

Quantity

24,599,691

Others

206,608

Value 19,754,059

1,821

129,068

2,622,407

1,768,735

27,428,706

21,651,862

Notes: 1. The quantitative information on consumption of components and others have not been given as these comprise of numerous items. 2. Net of shortage/excess/adjustment etc. 21. Value of imported and indigenous Raw Materials, Spares and Components consumed:

[` in Thousands (TINR)]

2011 %

2010 Value

%

Value

Imported (including customs duty)

45

12,654,544

42

9,570,785

Indigenous

55

15,662,335

58

13,017,020

100

28,316,879

100

22,587,805

[` in Thousands (TINR)] 2011 22.

C.I.F. Value of imports : Raw materials Components, spare parts, etc., Capital goods Trade goods

2010

12,325,544 1,022,018 2,432,841 12,171,720

9,225,116 884,309 905,925 10,230,350

27,952,123

21,245,700

[` in Thousands (TINR)]

23.

Expenditure in foreign currencies : Royalty and Technical service fee (net of tax) Professional fees, travelling, trainees’ expenses, etc.

2011

2010

1,161,583 1,879,315

1,092,791 1,141,516

3,040,898

2,234,307

[` in Thousands (TINR)] 24.

Earnings in foreign exchange : F.O.B. value of exports Others including professional fees etc.

2011

2010

10,344,144 457,192

8,460,718 388,630

10,801,336

8,849,348

Annual Report 2011 | Financial Statements | 95

Notes on accounts

25. Remittances in foreign currency on account of dividends to non-resident shareholders :

[` in Thousands (TINR)] 2011

No. of shareholders 1

No. of Shares

Face Value (Rs.)

Particulars

22,349,420 22,349,420 22,349,420

10 10 10

Final 2009 Final 2010 Interim 2011

2010

893,977 1,899,701

670,483 -

2,793,678

670,483

[` in Thousands (TINR)]

26. Disclosure under Micro, Small and Medium Enterprises Development Act, 2006.

2011

2010

(a) The amount due and remaining unpaid as at the balance sheet date - Principal - Interest thereon

98,313 8,212

65,163 7,029

(b) The amount of Principal and Interest paid beyond due date during the year - Principal - Interest thereon

48,002 -

206,094 -

(c) Interest due on Principal amounts paid beyond the due date during the year but without interest

-

-

(d) Interest accrued and remaining unpaid as at balance sheet date

1,183

3,629

(e) Total interest due but not paid for the earlier years

7,029

3,400

Note: The above information has been furnished to the extent such parties have been identified by the management, which has been relied upon by the auditors. 27. Previous year’s figures have been regrouped/recast, wherever necessary, to conform to current year’s classifications.

Signature to Schedule 1 to 19

For and on behalf of the Board

For Price Waterhouse & Co. Firm Registration Number: 007567S Chartered Accountants

Dr. A. Hieronimus B. Muthuraman Renu S Karnad Prasad Chandran Soumitra Bhattacharya

Radhakrishnan B Partner Membership Number: F25516 Place : Bangalore Date : February 28, 2012

A. Vijay Shankar Company Secretary

Directors

V.K. Viswanathan Dr. Manfred Duernholz

96 | Financial Statements | Annual Report 2011

Balance Sheet Abstract BALANCE SHEET ABSTRACT AND COMPANY’S GENERAL BUSINESS PROFILE AS PER SCHEDULE VI, PART (IV) OF THE COMPANIES ACT, 1956 I.

Registration Details Registration No.

L 8 5 1 1 0 K A 1 9 5 1 P L C 0 0 0 7 6 1

Balance Sheet Date

3 1 1 2 2 0 1 1 Date Month Year

State Code 0 8

II. Capital raised during the year (Amount in ` Thousands) Public Issue

Rights Issue

N I L

N I L

Bonus Issue

Private Placement

N I L

N I L

III. Position of Mobilisation and Deployment of Funds (Amount in ` Thousands) Total Liabilities

Total Assets

7 1 3 0 9 7 9 9

7 1 3 0 9 7 9 9

Source of Funds Paid-up Capital

Reserves & Surplus

3 1 3 9 8 9

4 6 9 7 0 3 6 1

Secured Loans

Unsecured Loans

1 8 1 0 9 5

2 8 9 0 3 2 5

Application of Funds Net Fixed Assets

Investments

1 0 6 0 7 5 5 8

1 6 0 6 3 6 4 6

Net Current Assets

Misc. Expenditure

2 1 4 0 8 5 6 6

N I L

Accumulated Losses N I L

Deferred Tax Asset 2 2 7 6 0 0 0

IV. Performance of Company (Amount in ` Thousands) Turnover (including other income)

Total Expenditure

8 4 7 9 2 1 8 4

6 9 0 5 2 3 3 0

Profit before tax

Profit before appropriation

1 5 7 39 8 5 4

1 1 2 2 5 5 8 4

Earnings per Share in `

Dividend rate %

3 5 8

5 0 0

V. Generic Names of Principal Products / Services of Company (as per monetary terms) Item Code No. (ITC Code) Product Description

8 4 . 0 8 F U E L &

&

8 4 . 0 9

I N J E C T I ON

EQU I PME N T

C OMP ON E N T S

Item Code No. (ITC Code)

8 5 . 1 1

Product Description

AU T O

Item Code No. (ITC Code)

8 5 . 0 8

Product Description

POR T A B L E

E L EC T R I C A L

I T EMS

E L E C T R I C

P OW E R

T OOL S

For and on behalf of the Board Dr. A. Hieronimus B. Muthuraman Renu S Karnad Prasad Chandran Soumitra Bhattacharya Place : Bangalore Date : February 28, 2012

A. Vijay Shankar Company Secretary

Directors

V.K. Viswanathan Dr. Manfred Duernholz

Annual Report 2011 | Subsidiary Company | 97

Subsidiary Company

STATEMENT REGARDING SUBSIDIARY COMPANIES PURSUANT TO SECTION 212(1) AND (3) OF THE COMPANIES ACT, 1956. MICO Trading Private Limited (a)

[` in Thousands (TINR)]

Holding Company’s interest: 100,000 Equity shares of ` 10 each fully paid up (i.e., 100% of the paid up Equity Capital)

(b)

Net aggregate amount of the Subsidiary’s profits/(losses) not dealt with in the Holding Company’s accounts: (i) For the Subsidiary’s financial year ended 31st December 2011 (ii) For its previous financial years

(c)

40 (18)

Net aggregate amount of the subsidiary’s profits/(losses) dealt with in the Holding Company’s accounts: (i) For the Subsidiary’s financial year ended 31st December 2011

Nil

(ii) For its previous financial years

Nil

For and on behalf of the Board Dr. A. Hieronimus B. Muthuraman Renu S Karnad Prasad Chandran Soumitra Bhattacharya Place : Bangalore Date : February 28, 2012

A. Vijay Shankar Company Secretary

Directors

V.K. Viswanathan Dr. Manfred Duernholz

98 | Subsidiary Company | Annual Report 2011

MICO Trading Private Limited

entries duly updated therein, as required under the provisions of the Act and the Rules made thereunder.

Directors V.K. Viswanathan Manfred Duernholz Auditors Price Waterhouse & Co.

3.

The Company has duly filed requisite Forms, Returns and Documents with the Registrar of Companies and such other authorities, as may be applicable under the said act within the time limits stipulated under the Act and the Rules made thereunder.

4.

The Board of Directors duly met four times during the year, on 28.02.11, 01.06.11, 30.08.11 and 06.12.11. In respect of these meetings, proper notices were given and the proceedings were duly recorded and signed in the Minutes Book maintained for the purpose.

5.

The Company was not required to close its Register of Members during the financial year.

6.

The Annual General Meeting for the financial year ended 31st December 2010 was held on 28.02.11 after giving requisite notice to members and the resolutions passed thereat were duly recorded in the Minutes Book maintained for the purpose.

Bankers Canara Bank Registrerd Office Hosur Road Adugodi, Bangalore - 560 030 Report of the Directors The Directors present their NINETEENTH Annual Report together with the Audited Statements of Accounts for the year ended 31st December 2011. The Company has not commenced business.

7.

No Extra-Ordinary general meeting was held during the financial year.

Directors Pursuant to Article 92 of the Articles of Association of the Company Dr. Manfred Duernholz retires by rotation at the Nineteenth Annual General Meeting. He is eligible for re-election.

8.

Being a Private Company, Section 295 of the Act relating to Loans to directors, etc., is not applicable.

9.

There were no contracts requiring the sanction of the Board under Section 297 of the Act and as such, no entries were made in the register maintained under Section 301 of the Act.

Energy, Technology, Foreign Exchange etc., As the Company has not commenced operations, the Directors have nothing to report in respect of the above. Auditors M/s. Price Waterhouse & Co., Chartered Accountants, the retiring auditors are eligible for re-appointment. Directors’ Responsibility Statement Pursuant to Section 217(2AA) of The Companies Act, 1956, we report that: -

In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any.

-

Accounting policies have been selected and applied consistently and the judgements and estimates made 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 or loss of the Company for that period.

-

Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of The Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

-

The annual accounts have been prepared on a going concern basis.

Certificate of Compliance under section 383A of the Companies Act, 1956 A Secretarial Compliance Certificate issued by Mr. K. V. Venkata Rangan, the Company Secretary in Whole-time practice, is annexed to the report. For and on behalf of the Board of Directors

Bangalore February 28, 2012

V.K. Viswanathan Manfred Duernholz Directors

10. None of the directors of the Company held any office or place of profit attracting the provisions of Section 314 of the Act. 11. The Company has not issued any duplicate share certificate/s during the year financial year. 12. There was no allotment of shares during the financial year. Also there were no transfers of shares during the year. 13. The Company has not declared any dividend during the financial year. 14. The provisions of Section 217(2AA) of the Act relating to ‘Directors’ Responsibility Statement’ have been complied with. A Copy of the Compliance Certificate was attached to the Report of the Board of Directors for the financial year ended 31.12.2011 as required under proviso to Section 383A of the Act. The Company has duly complied with the other requirements of Section 217 of the Act. 15. The Board of Directors of the Company is duly constituted and there were no appointment of additional directors, alternate directors and directors to fill casual vacancies during the financial year. 16. The Company being a private company, provision to section 269 of the Act with regard to appointment of Managing Director or Wholetime Director is not applicable. 17. The Company has not appointed any sole selling agents attracting the provisions of Section 294 and 294A of the Act during the financial year. 18. The Company was not required to obtain any approvals under the various provisions of the Act from the Central Government, Company Law Board, Regional Director, Registrar and/or such other authorities during the financial year. 19. The Company has no Preference Shares/Debentures. 20. The Company has not bought back any shares during the financial year. 21. During the financial year, the Company has not invited/accepted any deposits including any unsecured loans falling within the purview of Section 58A of the Act. 22. The Company has not made any borrowings during the financial year.

Secretarial Compliance Certificate [Under proviso to Sec.383A of the Companies Act, 1956 read with theCompanies (Compliance Certificate) Rules 2011] To The Members of MICO Trading Pvt. Ltd. I have examined the registers, records, books and papers of the Company as required to be maintained under the Companies Act, 1956, (the Act) and the rules made thereunder and also the provisions contained in the Memorandum and Articles of Association of the Company for the financial year ended on 31st December 2011. In my opinion and to the best of my information and based on my examinations as well as records made available and explanations furnished to me by the Company, its Officers and agents, I certify that in respect of the aforesaid financial year: 1.

2.

The paid-up capital of the Company is ` 10,00,000 and thus, it has the minimum paid-up Capital prescribed under the Act for private companies. Its maximum number of members during the financial year was three (3). There are no employee shareholders. The Company during the year under scrutiny: i) has not invited public to subscribe for its shares and ii) has not invited or accepted any deposits from public or its members, directors or their relatives. The Company has kept and maintained statutory registers with

23. The Company has not made any loans or advances or given guarantees or provided securities to other bodies corporate and consequently no entries have been made in the register kept for the purpose. 24. The Directors have disclosed their interest in other firms/companies to the Board of Directors pursuant to the provisions of the Act and the rules made thereunder. 25. The Company has not altered any of the provisions of its Memorandum of Association during the financial year. 26. As per records made available and information given, there were no prosecution proceedings initiated against or show cause notices received by the Company and no fines or penalties or any other punishment was imposed on the Company during the financial year, nor were any prosecution proceedings pending against the Company for offences under the Act. 27. Since there are no employees in the Company the question of setting up provident fund trust under section 418 of the Act or receiving any money as security from them does not arise.

Bangalore 28.02.2012

(K.V. Venkata Rangan) Practicing Company Secretary FCS:934; CP: 404

Annual Report 2011 | Subsidiary Company | 99

Auditors’ Report

clauses (f) and (g) of clause (iii) of Paragraph 4 of the Order are not applicable.

To The Members of MICO Trading Private Limited 1.

We have audited the attached Balance Sheet of MICO Trading Private Limited (the “Company”) as at December 31, 2011, and the related Profit and Loss Account and Cash Flow Statement for the year ended on that date annexed thereto, which we have signed under reference to this report. These financial statements are the responsibility of the Company’s Management. Our responsibility is to express an opinion on these financial statements based on our audit.

2.

We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by Management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3.

As required by the Companies (Auditor’s Report) Order, 2003, as amended by the Companies (Auditor’s Report) (Amendment) Order, 2004 (together the “Order”), issued by the Central Government of India in terms of sub-section (4A) of Section 227 of ‘The Companies Act, 1956’ of India (the ‘Act’) and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

4.

Further to our comments in the Annexure referred to in paragraph 3 above, we report that: (a) We have obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the purposes of our audit;

2.

According to the information and explanations given to us, there have been no contracts or arrangements referred to in Section 301 of the Act during the year to be entered in the register required to be maintained under that Section. Accordingly, the question of commenting on transactions made in pursuance of such contracts or arrangements does not arise.

3.

The Company has not accepted any deposits from the public within the meaning of Sections 58A and 58AA of the Act and the rules framed there under.

4.

As the Company is not listed on any stock exchange or the paid-up capital and reserves as at the commencement of the financial year did not exceed Rupees Fifty Lakhs or the average annual turnover for a period of three consecutive financial years immediately preceding the financial year did not exceed Rupees Five Crores, clause (vii) of paragraph 4 of the Companies (Auditor’s Report) Order, 2003 is not applicable for the year.

5. (a)

According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing the undisputed statutory dues including provident fund, investor education and protection fund, employees’ state insurance, income-tax, sales-tax, wealth tax, service tax, customs duty, excise duty, cess and other material statutory dues as applicable with the appropriate authorities.

(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of income-tax, sales-tax, wealth-tax, service-tax, customs duty, excise duty and cess which have not been deposited on account of any dispute. 6.

(c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account;

As at the balance sheet date the accumulated losses of the Company do not exceed fifty percent of its net-worth. The Company has not incurred any cash losses in the financial year ended December 31, 2011 but has incurred cash losses in the preceding financial year.

7.

(d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Act;

According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of dues to any financial institution or bank or debenture holders as at the balance sheet date.

8.

The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

9.

The provisions of any special statute applicable to chit fund/ nidhi/ mutual benefit fund/ societies are not applicable to the Company.

10.

In our opinion, the Company is not a dealer or trader in shares, securities, debentures and other investments.

11.

In our opinion and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions during the year.

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

(e) On the basis of written representations received from the directors, as on December 31, 2011 and taken on record by the Board of Directors, none of the directors is disqualified as on December 31, 2011 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Act; (f) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements together with the notes thereon and attached thereto give, in the prescribed manner, the information required by the Act, and give a true and fair view in conformity with the accounting principles generally accepted in India: (i)

in the case of the Balance Sheet, of the state of affairs of the company as at December 31, 2011;

12.

The Company has not obtained any term loans.

13.

On the basis of an overall examination of the balance sheet of the Company, in our opinion and according to the information and explanations given to us, there are no funds raised on a short-term basis which have been used for long-term investment.

14.

The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Act during the year.

15.

During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the Management.

16.

The other clauses, (i), (ii), (iv), (viii), (xix) and (xx) of paragraph 4 of the Companies (Auditor’s Report) Order 2003, as amended by the Companies (Auditor’s Report) (Amendment) Order, 2004, are not applicable in the case of the Company for the year, since in our opinion there is no matter which arises to be reported in the aforesaid Order.

(ii) in the case of the Profit and Loss Account, of the profit for the year ended on that date; and (iii) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date. For Price Waterhouse & Co. Firm Registration Number: 007567S Chartered Accountants Place Date

: Bangalore : February 28, 2012

Radhakrishnan B Partner Membership Number: F25516

ANNEXURE TO AUDITORS’ REPORT Referred to in paragraph 3 of the Auditors’ Report of even date to the members of MICO Trading Private Limited on the financial statements for the year ended December 31, 2011. 1.

(a) The Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under Section 301 of the Act, accordingly sub clauses (b), (c) and (d) of clause (iii) of Paragraph 4 of the Order are not applicable. (b) The Company has not taken any loans, secured or unsecured, from companies, firms or other parties covered in the register maintained under Section 301 of the Act, accordingly sub

Place : Bangalore Date : February 28, 2012

For Price Waterhouse & Co. Firm Registration Number: 007567S Chartered Accountants Radhakrishnan B Partner Membership Number: F25516

100 | Subsidiary Company | Annual Report 2011

Balance Sheet as at December 31, 2011 [` in Thousands (TINR)] Schedule

2011

2010

SOURCES OF FUNDS Shareholders’ Funds Share Capital Total APPLICATION OF FUNDS Current Assets, Loans and Advances Cash and Bank Balances Loans and Advances Less : Current Liabilities and Provisions Current Liabilities Provisions

1

2 3

4 5

1,000

1,000

1,000

1,000

1,066 8

1,017 12

1,074

1,029

146 4

145 -

150 Net Current Assets Profit and Loss Account Total Notes on Accounts

145 924 76 1,000

884 116 1,000

6

The schedules referred to above and the notes thereon form an integral part of the Balance Sheet This is the Balance Sheet referred to in our report of even date For Price Waterhouse & Co. Firm Registration Number: 007567S Chartered Accountants Radhakrishnan B Partner

For and on behalf of the Board

Membership Number: F25516

V.K.Viswanathan Dr. Manfred Duernholz Directors

Place : Bangalore Date : February 28, 2012

Profit & Loss Account for the year ended December 31, 2011 [` in Thousands (TINR)] Schedule

2011

2010

INCOME Interest Income [Tax deducted at source : TINR 9 (2010: TINR 2)]

85

9

EXPENDITURE Professional Fees

28

PROFIT/ (LOSS) BEFORE TAXATION

27 28

27

57

(18)

Provision for Taxation - Current

17

-

-

-

- Deferred PROFIT/ (LOSS) AFTER TAXATION Balance brought forward Balance carried forward to Balance Sheet Basic/Diluted Earnings per share (`) Face value ` 10 each (Refer Note 5 of Schedule 6) Notes on Accounts

40

(18)

(116)

(98)

(76)

(116)

0.4

(1.1)

6

The schedules referred to above and notes thereon form an integral part of the Profit and Loss Account This is the Profit and Loss Account referred to in our report of even date For Price Waterhouse & Co. Firm Registration Number: 007567S Chartered Accountants Radhakrishnan B Partner

For and on behalf of the Board

Membership Number: F25516

Place : Bangalore Date : February 28, 2012

V.K.Viswanathan Dr. Manfred Duernholz Directors

Annual Report 2011 | Subsidiary Company | 101

Cash flow Statement for the year ended December 31, 2011 [` in Thousands (TINR)] 2011

2010

A. Cash flow from operating activities Profit/(loss) before tax

57

(18)

Adjustments for : Interest Received Operating profit/(loss) before working capital changes

(85)

(9)

(28)

(27)

Adjusted for Increase / (decrease) in current liabilities Cash generated from operations Direct Taxes (paid)/refund received Net cash from operating activities

1

-

(27)

(27)

(9)

(2)

(36)

(29)

B. Cash flow from investing activities Interest received

85

2

Net cash from/ (used in) investing activities

85

2

C. Cash flow from financing activities Equity capital raised during the year

-

900

Net cash from/ (used in) financing activities

-

900

49

873

Net cash flows during the year (A+B+C) Cash and Cash equivalents (Opening balance)

1,017

144

Cash and Cash equivalents (Closing balance)

1,066

1,017

Note : Above Cash Flow Statement has been prepared under indirect method in accordance with the Accounting Standard 3 as notified under section 211(3C) of the Companies Act, 1956.

This is the Cash Flow Statement referred to in our report of even date

For Price Waterhouse & Co. Firm Registration Number: 007567S Chartered Accountants Radhakrishnan B Partner

For and on behalf of the Board

Membership Number: F25516

Place : Bangalore Date : February 28, 2012

V.K.Viswanathan Dr. Manfred Duernholz Directors

102 | Subsidiary Company | Annual Report 2011

Schedules to Balance Sheet [` in Thousands (TINR)]

SCHEDULE 1: SHARE CAPITAL 2011

2010

Authorised 100,000 (2010 : 100,000) Equity shares of ` 10 each

1,000

1,000

1,000

1,000

1,000

1,000

Issued, Subscribed and fully Paid up 100,000 (2010 : 100,000) Equity shares of ` 10 each Note : The above shares are held by Bosch Ltd., India the holding company

[` in Thousands (TINR)]

SCHEDULE 2: CASH AND BANK BALANCES 2011 Cash on hand

2010 -

-

45

18

Balances with Scheduled Banks - In current account - In deposit accounts

1,021

999

1,066

1,017

[` in Thousands (TINR)]

SCHEDULE 3: LOANS AND ADVANCES 2011

2010

(Unsecured and considered good) Advances recoverable in cash or in kind or for value to be received

8

Advance Tax

9

-

3

8

12

[` in Thousands (TINR)]

SCHEDULE 4: CURRENT LIABILITIES 2011

2010

Sundry Creditors Dues to Micro Enterprises and Small Enterprises (Refer Note 8 of Schedule 6) Dues of Others*

-

-

146

145

146

145

* Includes TINR 132 (2010: TINR 132) payable to Bosch Ltd., India, the holding company

[` in Thousands (TINR)]

SCHEDULE 5: PROVISIONS 2011 Taxation [Net of Advance Tax TINR 13 (2010: Nil)]

2010 4

-

4

-

Annual Report 2011 | Subsidiary Company | 103

Notes on accounts SCHEDULE 6: NOTES FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED DECEMBER 31, 2011

1.

Significant Accounting Policies: (a) The financial statements are prepared under historical cost convention in accordance with Generally Accepted Accounting Principle in India and comply in all material respects with the applicable accounting standards notified under section 211(3C) of the Companies Act, 1956 and the relevant provisions of the Companies Act, 1956. (b) Interest on bank deposits is recognised on a time proportion basis. (c) Taxes On Income Provision is made for income tax annually based on the tax liability computed after considering tax allowances and exemptions. Deferred tax is recognised on timing differences between the accounting income and the taxable income for the year and quantified using the tax rates and laws enacted or substantively enacted as on the Balance Sheet date. Deferred tax assets are recognised and carried forward to the extent that there is a virtual certainty that sufficient future taxable income will be available against which such deferred tax asset can be realised.

[` in Thousands (TINR)] 2011

2010

2.

Contingent Liabilities

-

-

3.

Estimated amount of contracts remaining to be executed on capital accounts and not provided for (net of advances)

-

-

4.

Remuneration to auditors: (excluding service tax)

5.

Audit Fees

13

12

Taxation matters

12

12

Earnings per Share Net Profit/(Loss) after taxation Weighted Average number of Equity Shares of ` 10 each Basic and Diluted Earnings Per Share (`)

6.

40

(18)

100,000

16,164

0.4

(1.1)

Segmental Reporting : The Company has not commenced business. Segment information for reportable segments as envisaged under AS 17 on segment reporting as notified under section 211 (3C) of the Companies Act, 1956, have not been disclosed as there has been no operations during the year.

7.

Related Party Disclosure : Holding Company: Bosch Limited, India Amount payable : TINR 132 (2010 : TINR 132)

8.

The Company does not have any transactions or dues in relation to any supplier registered under Micro, Small and Medium Enterprises Development Act, 2006.

9.

Previous year's figures have been regrouped/recast, wherever necessary, to conform to current year's classifications.

Signatures to Schedules 1 to 6. For Price Waterhouse & Co. Firm Registration Number: 007567S Chartered Accountants Radhakrishnan B Partner

For and on behalf of the Board

Membership Number: F25516

Place : Bangalore Date : February 28, 2012

V.K.Viswanathan Dr. Manfred Duernholz Directors

104 | Subsidiary Company | Annual Report 2011

Balance Sheet Abstract BALANCE SHEET ABSTRACT AND COMPANY’S GENERAL BUSINESS PROFILE AS PER SCHEDULE VI, PART (IV) OF THE COMPANIES ACT, 1956 I.

Registration Details Registration No.

U 5 1 1 0 9 K A 1 9 9 2 P T C 0 1 3 7 3 6

Balance Sheet Date

3 1 1 2 2 0 1 1 Date Month Year

State Code 0 8

II. Capital raised during the year (Amount in ` Thousands) Public Issue

Right Issue

N I L

N I L

Bonus Issue

Private Placement

N I L

N I L

III. Position of Mobilisation and Deployment of Funds (Amount in ` Thousands) Total Liabilities

Total Assets

1 1 5 0

1 1 5 0

Source of Funds Paid-up Capital

Reserve & Surplus

1 0 0 0 Secured Loans

N I L Unsecured Loans

N I L

N I L

Application of Funds Net Fixed Assets

Investments

N I L

N I L

Net Current Assets

Misc. Expenditure

9 2 4

N I L

Accumulated Losses 7 6 IV. Performance of Company (Amount in ` Thousands) Turnover (including other income)

Total Expenditure

8 5 Profit before tax

2 8 Profit before appropriation

5 7 Earnings per Share in ` 0.4

4 0 Dividend rate % - -

V. Generic Names of Principal Products / Services of Company (as per monetary terms) - NOT APPLICABLE For and on behalf of the Board

Place : Bangalore Date : February 28, 2012

V.K.Viswanathan Dr. Manfred Duernholz Directors

Annual Report 2011 | Shareholder Information | 105

Shareholder Information

Board Meetings Board Meetings are usually held in February/March, June, September and December. Particulars of Board Meetings held in 2011 are given below. Monday, February 28 Wednesday, May 18 Wednesday, June 1 Tuesday, August 30 Friday, December 9 Annual General Meeting (AGM) The Annual General Meeting of the Company is usually held in June each year. Particulars of the AGM held during the last three years are given below. 2009

-

10.30 a.m. Thursday, May 28; Taj Residency, Bangalore

2010

-

10.30 a.m. Thursday, June 03; Taj Residency, Bangalore

2011

-

10.30 a.m. Wednesday, June 01; Vivanta by Taj, Bangalore

Particulars of Special Resolutions passed in the last three AGMs are given below. 28.05.09 - Nil. 03.06.10 - Payment of commission to Non Wholetime Directors not exceeding in aggregate 1% per annum of the net profits of the Company computed in the manner laid down in Sections 198, 349 and 350 of the Companies Act, 1956, for each of the 5 financial years of the Company commencing from 01.01.2010 to 31.12.2014. 01.06.11 - Commencement of business pursuant to clause 149(2A) of the Companies Act, 1956, relating to carrying on the business of import, export, purchase, sale, trade and manufacture of products, systems and accessories including execution of projects, servicing and maintenance with relation to Solar Energy and Thermo Technology. During the last financial year, no resolution was passed through postal ballot in accordance with section 192A of the Companies Act, 1956. Financial Year The financial year of the Company is from January to December. The financial results for the quarter / half-year / year are published as under.

Quarter/half-year/year st

quarter ending 31 March

In the month of April/May

quarter/half-year ending 30th June July/August quarter ending 30th September

October/November

Year ending 31st December

February/March

Book Closure The Register of Members and Share Transfer books are usually closed in May each year for about 13 days for ascertaining the names of the shareholders entitled to receive dividend. Dematerialization of Shares 71.18% of the paid-up capital is held by Robert Bosch GmbH. Of the balance 28.82% held by public, shares representing 27.80% of the paid-up capital have been dematerialized. The Company entered into agreement with the following Depositories whereby the equity shares of the Company were admitted as 'eligible security' in the depository system: 1. National Securities Depository Limited (NSDL): January 05, 1999. 2. Central Depository Services (India) Limited (CDS): August 04, 2000. Members still holding share certificates in physical form are requested to dematerialize their shares by approaching any of the Depository Participants registered with the Securities and Exchange Board of India (SEBI). From June 26, 2000 the shares of the Company are mandated by SEBI for trading in dematerialized form. Listing of Shares The Company's equity shares are listed at the following stock exchanges in order to impart liquidity and convenience for trading: Name and address of the Stock Exchange

Stock Code

Bombay Stock Exchange Ltd., Phiroze Jeejeebhoy Towers, Dalal Street, Fort, Mumbai 400 023

500530

National Stock Exchange of India Limited, Exchange Plaza, 5th Floor, Bandra - Kurla Complex, Bandra, Mumbai 400 051

BOSCHLTD

The International Securities Identification Number (ISIN) for the Company’s Shares in dematerialized form is INE 323 A01026. Listing fee for the year 2011-2012 has been paid to these exchanges.

106 | Shareholder Information | Annual Report 2011

From 30th November 2007, the National Stock Exchange of India Limited (NSE) included equity shares of the Company in the Futures and Options (F&O) segment. Custodial Fee Pursuant to the Securities and Exchange Board of India (SEBI) Circular No.MRD/DoP/SE/DEP/CIR4/2005 dated 28th January, 2005, Issuer Companies are required to pay custodial fees to the depositories with effect from 1st April, 2005. Accordingly, the Company has paid the annual custodial fee for the year 2011-12 to NSDL and CDS on the basis of the number of beneficial accounts maintained by them as on 31st March 2011. Procedure for claiming unpaid dividend In terms of Section 205A(5) of The Companies Act, 1956, monies transferred to the Unpaid Dividend Account of the Company, which remain unpaid or unclaimed for a period of seven years from the date of such transfer, shall be transferred by the Company to the Investor Education and Protection Fund established by the Central Government. Brief particulars of dividend amount remaining unpaid are given below. Year to which the dividend pertains

Declared at the AGM/ (Board) Meeting held on

Date of transfer to Unpaid Dividend Account

Balance in the Unpaid Dividend Account (31.12.2011) (`)

Due date for transfer to the Fund*

2004

15.06.05

18.07.05

724,260

17.07.12

2005

01.06.06

05.07.06

868,164

04.07.13

2006 (Interim) 2006 (Final)

(12.03.07)

11.04.07

836,292

11.04.14

07.06.07

11.07.07

294,456

10.07.14

2007

05.06.08

10.07.08

1,827,900

10.07.15

2008

28.05.09

02.07.09

1,918,625

01.07.16

2009

03.06.10

08.07.10

2,498,280

07.07.17

2010 2011 (special)

01.06.11

06.07.11

3,436,080

05.07.18

(01.06.11)

06.07.11

7,319,945

05.07.18

* [as per sub-section 5 of Section 205A of The Companies Act, 1956, as amended by the Companies (Amendment) Act, 1999]

Members can claim the unpaid dividend from the Company before transfer to the Investor Education and Protection Fund. It may be noted that after the unpaid dividend is transferred to the said Fund, the same cannot be claimed. Bank particulars for Dividend Warrants With a view to preventing fraudulent encashment of dividend warrants, members holding shares in physical form are advised to furnish to the Company particulars of their bank account with a request to incorporate the same in the dividend warrant.

Electronic Clearing Service The Company makes payment of dividend through Electronic Clearing Service (ECS)/National Electronic Clearing Service (NECS) to members at select centers. Under this system of payment of dividend, the shareholders get the credit of dividend directly in their designated bank account. This ensures direct and immediate credit with no chance of loss of warrant in transit or its fraudulent encashment. However, the Company may pay the dividend by issue of warrants where no ECS/NECS particulars made available to the Company. Members holding Shares in physical form, who wish to avail of the ECS/NECS facility, are requested to give the ECS/NECS mandate in the prescribed form. The form can be obtained from the Company’s website www.boschindia.com under the Section ‘Shareholder Information’. Payment of Dividend Dividend warrants are posted to Members at their registered address usually within two days of the declaration of dividend at the Annual General Meeting. Dividend warrants in respect of shares held in electronic/dematerialized form are posted to the beneficial owners to their address as per the information furnished by NSDL and CDS as on the record date. Warrants for high value amounts are sent through Registered Post. Particulars of dividend declared in the previous years (from the year 2000) are given below. Year

Dividend per share (`)

Year

2000

31.00

2006

2001

31.00

2006

2002

3.00 (interim)

2007

Dividend per share (`.) 12.00 (interim) 4.00 (final) 25.00

2002

40.00 (final)

2008

25.00

2003

65.00

2009

30.00

2004

10.00

2010

40.00

2005

12.00

2011

85.00 (special)

(Note: upto 2003: on shares of face value ` 100; from 2004: on shares of face value ` 10)

Shares held in physical/dematerialised form M/s. Integrated Enterprises (India) limited, No. 30, Ramana Residency, 4th Cross, Sampige Road, Malleswaram, Bangalore - 560 003, is the Company’s Registrar and Transfer Agent (R&T) both in respect of shares held in physical form and dematerialized form. Inquiries may be addressed either to the Registrar and Transfer Agent or to the Secretarial Department of the Company.

Annual Report 2011 | Shareholder Information | 107

benefits like rights, bonus shares etc., when declared / announced.

Requirement of PAN for certain transactions The Securities and Exchange Board of India (SEBI) vide circular ref. no. MRD/DoP/Cir-05/2009 dated May 20, 2009, clarified that for securities market transactions and off-market/private transactions involving transfer of shares in physical form of listed companies, it is mandatory for the transferee(s) to furnish copy of PAN card to the Company / RTAs for registration of such transfer of shares. Further, SEBI vide circular ref.no. MRD/DoP/SE/ RTA/ Cir-03/2010 dated January 07, 2010, clarified that for deletion of name of the deceased shareholder(s), transmission of shares to the legal heir(s) and for transposition of shares, it shall be mandatory to furnish a copy of PAN card to the Company/RTAs. Nomination Pursuant to the provisions of Section 109A of The Companies Act, 1956, members may file Nomination in respect of their shareholdings. Members holding shares in physical form willing to avail this facility may submit to the Company the prescribed Form 2B (in duplicate), if not already filed. Form 2B can be downloaded from the Company’s website www.boschindia.com under the section ‘Shareholder Information’. Members holding shares in electronic form are requested to give the nomination to their respective Depository Participants directly. Rights of members The following are some of the important rights of the members: 1.

Receive notices of General Meetings, Annual Report, Balance sheet, Profit and Loss Account and Auditors Report.

2.

Attend and vote at the General Meetings and appoint proxy in their stead.

3.

Demand for a poll along with other members who collectively hold not less than 1/10th of the voting power or who collectively hold 5000 shares (i.e., shares on which aggregate sum of not less than ` 50,000 has been paid up).

4.

5.

Request an Extraordinary General Meeting along with other members who collectively hold not less than 1/10th of the total paid up capital of the Company. Receive dividends and other corporate

6.

Transfer the shares.

7.

Receive the share certificates upon transfer within one month from the date of lodgement.

8.

Inspect minutes book of General Meetings.

9.

Inspect various registers such as Register of Members, Register of Directors, Register of Directors’ Shareholding etc.

10. Nominate a person to whom his/her shares shall vest in the event of death. 11. Appoint or remove director(s) and auditor. 12. Seek relief in case of oppression and mismanagement. Audited Annual Financial Results The statement of Audited Financial Results and the statement of segment-wise revenue, results and capital employed for the year ended 31st December, 2011 prepared pursuant to Clause 41 of the listing agreements entered into with the Stock Exchanges are available in the Company’s website www.boschindia.com. The statement was approved by the Board of Directors at their Meeting held on 28.02.2012. Shareholding Pattern (as on 31.01.2012) Category

No. of Members

No. of Shares held

% to the Capital

Robert Bosch GmbH

1

2,23,49,420

71.18

Public Financial Institutions

9

30,90,280

9.84

Foreign Institutional Investors

85

18,07,511

5.76

Mutual Funds

60

9,96,382

3.17

9

8,690

0.03

Bodies Corporate

707

7,29,696

2.32

Foreign Nationals/ NRIs/OCBs

534

89,992

0.29

Nationalized Banks

Public

22,673

23,26,929

7.41

Total

24,078

3,13,98,900

100.00

Distribution of Shareholding (as on 31.01.2012) No. of Shares held 1-500

Members

Shares

No.

%

No.

%

23,156

96.17

11,06,996

3.53

501-1000

445

1.85

3,18,370

1.02

1001-2000

240

1.00

3,29,227

1.02

2001-3000

64

0.27

1,58,389

0.52

3001-4000

29

0.12

99,895

0.30

4001-5000

20

0.08

89,754

0.32

5001-10000

37

0.15

2,52,882

0.87

>10000 Total

87

0.36

2,90,43,387

92.42

24,078

100.00

3,13,98,900

100.00

108 | Shareholder Information | Annual Report 2011

Price and Volume of Shares Traded Month/ Year

Bombay Stock Exchange Ltd. High `

Low `

Volume Nos.

Website

National Stock Exchange of India Ltd. High `

Low `

Volume Nos.

Feb 2011

6150

5855

9464

6158

5901

156071

Mar 2011

6835

5900

42562

6897

5801

197777

Apr 2011

7038

6268

42436

7020

6251

133005

May 2011

7145

6550

74924

7139

6545

173980

Jun 2011

7250

6748

29880

7240

6750

91277

Jul 2011

7480

6855

23568

7580

6861

88731 112036

Aug 2011

7460

6500

25077

7475

6780

Sep 2011

7480

6850

25105

7464

6878

64689

Oct 2011

7167

6899

9394

7170

6884

102066

Nov 2011

7244

6810

17617

7255

6801

118490

Dec 2011

7170

6425

28794

7175

6448

108927

Jan 2012

7400

6702

37786

7350

6662

116023

(Source: BSE, NSE)

Share Price (BSE) and Index

The Company’s website www.boschindia.com contains comprehensive information about the Company, Products, Services and Solutions, Press Releases and Shareholder Information. The ‘Shareholder Information’ section serves to inform the Shareholders by providing key information like Board of Directors and the Committees of the Board, Corporate Governance, Financial Results, Shareholding Pattern, Distribution of Shareholding, Dividend etc. Registrar and Transfer Agent (For shares held in physical & dematerialised form) Integrated Enterprises (India) Limited No. 30, Ramana Residency 4th Cross, Sampige Road Malleswaram Bangalore 560 003 Tel: (080) 23460815 to 818; Fax: (080) 23460819 Investor Service Centre Secretarial Department (BCS) Bosch Limited Hosur Road, Adugodi Bangalore – 560 030 Tel: (080) 2299 2393 (Extn. 2314); Fax: (080) 2299 2181

Shareholders holding more than 1% of the share capital of the Company (as on 31.01.2012) Sl. No.

Name of the Shareholder

No. of shares held 2,23,49,420

% to paid- up capital

1.

Robert Bosch GmbH

2.

General Insurance Corpn. of India

10,11,359

71.18 3.22

3.

The New India Assurance Co. Ltd.

9,28,572

2.96

4.

Aberdeen Asset Managers Ltd.

9,40,000

2.99

5.

United India Insurance Co. Ltd.

3,94,843

1.26

Monday to Friday: 9.00 a.m. to 12.00 noon except holidays. Designated e-mail ID for redressel of investor complaints [email protected] Compliance Officer Mr. A. Vijay Shankar, Company Secretary Inquiries, if any, may be addressed to the Compliance Officer.

Annual Report 2011 | National Network | 109

National Network

Manufacturing Facilities Factories Bangalore Post Box No. 3000 Hosur Road, Adugodi Bangalore - 560 030 Phone: (080) 2299 2393 Fax: (080) 2227 2728

Naganathapura Post Box No. 6887 Electronic City P.O. Bangalore - 560 100 Phone: (080) 2852 1221 Fax: (080) 2852 1239

Nashik Post Box No. 64 75, MIDC Estate Satpur, Trimbak Road Nashik - 422 007 Phone: (0253) 235 0342 - 45 Fax: (0253) 235 3143

Jaipur SP-663 RIICO Industrial Area Sitapura Jaipur - 302 022 Phone: (0141) 277 1700 Fax: (0141) 277 1787

Ernakulam MCM Building, IN. SY. No. 145/12A, 38/232 N.H. By-Pass Road Padivattom Ernakulam Cochin - 682 024

Kolkata 91-A, Park Street Kolkata - 700 019

Raipur 2nd Floor Pithalia Complex Opp. Telephone Exchange Near Fafadih Chowk Raipur - 492 001

Verna (Goa) Packaging Technology Division N4, Phase IV, Verna Industrial Estate Verna, Salcate, Goa - 403 722 Phone: (0832) 6692 018 Fax: (0832) 6692 028

Sales Offices Ahmedabad 31/32, JMC House, Level 3 Opp. to Parimal Garden Ellis Bridge Ahmedabad - 380 006 Bangalore 21/1, Mission Road Bangalore - 560 027 Chandigarh, Mohali & Panchkula SCO 301 Sector - 09 Panchkula - 134 109 Chennai ‘Blossom Centre’ New No: 30 (Old No: 27) North Boag Road T. Nagar Chennai - 600 017 Delhi & Gaziabad ‘Rishyamook’ 85-A, Panchkuian Road New Delhi - 110 001

Guwahati 3rd Floor Mayur Garden Building Opp. Rajiv Bhavan G S Road Guwahati - 781 005

Lucknow 2nd Floor, Madan Plaza 14, Station Road Lucknow - 226 001 Mumbai 79, Dr. Annie Besant Road Worli Mumbai - 400 018

Indore 2nd Floor, MAN House 15th PU-3, Scheme No. 54 AB Road Indore - 452 008

Patna Plot No. 21/A-2, Opp. UNICEF Office Pataliputra Colony Patna - 800 013

Jaipur T 304 Sangam Towers Church Road Off MI Road Jaipur - 302 001

Jharkhand Bhagirathi Complex Opp. Adivasi Hospital Karam Toli Road Ranchi - 834 008

Secunderabad ‘Sweksha’, Plot No. 117 Srinagar Colony Trimulgherry Secunderabad - 500 015 Bhubaneshwar Plot No. N-6/454 IRC Village Jayadev Vihar Nayapalli Bhubaneshwar - 751 015

Annual Report 2011 | Attendance Slip and Proxy | 111

Bosch Limited Regd. Office: Hosur Road, Adugodi, Bangalore - 560 030.

ATTENDANCE SLIP (to be surrendered at the time of entry)

60TH ANNUAL GENERAL MEETING Date: 4th June 2012. Time: 10.30 a.m. Place: Trinity Hall, Vivanta By Taj, 41/3, Mahatma Gandhi Road, Bangalore - 560 001.

* Signature of the members present: ........................................................................................................................ * Signature of the proxy present: .............................................................................................................................. Folio/Client ID No: ................................................................................................................................................... Name of the member: ............................................................................................................................................... Address: .................................................................................................................................................................. ................................................................................................................................................................................. Note: 1. Only members or their proxies will be allowed to attend the meeting. 2. Bodies Corporate, whether a company or not, who are members, may attend through their authorised representatives appointed under Section 187 of the Companies Act, 1956. A copy of authorisation should be deposited with the Company. 3. Please bring with you copy of AGM Notice to the meeting hall together with this Attendance Slip duly filled in. 4. In case of shares held in demat/electronic form, the signature of the Beneficial Owner is liable for verification with the record furnished to the Company by NSDL/CDS. Beneficial Owners are advised to bring relevent identity card issued by the Depository Participant. * Stike off whichever is not applicable.

Bosch Limited Regd. Office: Hosur Road, Adugodi, Bangalore - 560 030.

PROXY I/We........................................................................................................................................................................ ................................................................................................................................................................................. ................................................................................................................................................................................. of ............................................................................................................................................................................. being a member/members of Bosch Limited, hereby appoint ............................................................................. .......................................................of .......................................................................................................or failing him/her.................................................................of................................................................................................ as my/our proxy to vote for me/us on my/our behalf at the 60th Annual General Meeting of the Company to be held on Monday, 4th June 2012 at Trinity Hall, Vivanta By Taj, 41/3, Mahatma Gandhi Road, Bangalore - 560 001, at 10.30 a.m. and at any adjournment thereof. Signed this ......................................day of...............................2012

Affix Re. 1 Revenue Stamp

Note: 1. The Proxy and Power of Attorney (if any) under which it is signed or a notarised copy of that power must be deposited at the Registered Office of the Company not less than 48 hours before the time for holding the Meeting. 2. In the case of joint shareholders, all must sign the proxy form.

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bosch ar 2001 rgb - Bosch India

Contents 4 About Bosch Group 5 About Bosch Limited 6 Board of Directors, Committees, etc. 8 People at Bosch - Key for Success 17 Report of ...

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