DIRECTOR
TO THE MEMBERS OF TATA MOTORS LIMITED
The Directors present their Sixty-Sixth Annual Report and the Audited Statement of
Accounts for the year ended March 31, 2011.
FINANCIAL PERFORMANCE SUMMARY
(in crores)
|
Company (Standalone) |
Tata Motors Group (Consolidated) |
|
2010-11 |
2009-10 |
2010-11 |
2009-10 |
| A FINANCIAL RESULTS |
|
|
|
|
| (i) Gross Revenue |
52,135.97 |
38,364.10 |
1,27,419.62 |
95,567.42 |
| (ii) Net Revenue (excluding excise duty) |
48,040.46 |
35,593.05 |
1,23,133.30 |
92,519.25 |
| (iii) Total Expenditure |
43,269.15 |
31,414.77 |
1,05,353.33 |
83,905.09 |
| (iv) Operating Profit |
4,771.31 |
4,178.28 |
17,779.97 |
8,614.16 |
| (v) Other Income |
183.26 |
1,853.45 |
89.61 |
1,793.12 |
| (vi) Profit before Interest, Depreciation, Amortization, Exceptional item & Tax |
4,954.57 |
6,031.73 |
17,869.58 |
10,407.28 |
| (vii) Interest and Discounting Charges (net) |
1,143.99 |
1,103.84 |
2,045.42 |
2,239.71 |
| (viii) Cash Profit |
3,810.58 |
4,927.89 |
15,824.16 |
8,167.57 |
| (ix) Depreciation, Amortization & Product Development Expenses |
1,466.94 |
1,177.90 |
5,618.00 |
4,385.33 |
| (x) Profit for the year before Exceptional items & Tax |
2,343.64 |
3,749.99 |
10,206.16 |
3,782.24 |
| (xi) Exceptional items - Loss/(Gain) |
147.12 |
920.45 |
(231.01) |
259.60 |
| (xii) Profit Before Tax |
2,196.52 |
2,829.54 |
10,437.17 |
3,522.64 |
| (xiii) Tax Expense |
384.70 |
589.46 |
1,216.38 |
1,005.75 |
| (xiv) Profit After Tax |
1,811.82 |
2,240.08 |
9,220.79 |
2,516.89 |
| (xv) Share of Minority Interest and Share of Profit in respect of investments in
associate companies |
- |
- |
52.83 |
54.17 |
| (xvi) Profit for the year |
1,811.82 |
2,240.08 |
9,273.62 |
2,571.06 |
| (xvii) Balance Brought Forward from Previous Year - Profit/(Loss) |
1,934.13 |
1,685.99 |
(1,017.85) |
(1,553.66) |
| (xviii) Amount Available for Appropriations |
3,745.95 |
3,926.07 |
8,255.77 |
1,017.40 |
| B APPROPRIATIONS |
|
|
|
|
| (a) Debenture Redemption Reserve |
- |
500.00 |
- |
500.00 |
| (b) General Reserve |
200.00 |
500.00 |
228.78 |
520.32 |
| (c) Other Reserves |
- |
- |
84.20 |
13.08 |
| (d) Dividend (including tax) |
1,467.03 |
991.94 |
1,481.30 |
1,001.85 |
| (e) Balance carried to Balance Sheet |
2,078.92 |
1,934.13 |
6,461.49 |
(1,017.85) |
DIVIDEND
Considering the Company's financial performance, the Directors have recommended a
dividend of 20/- per share on the increased capital of 53,83,22,483 Ordinary Shares of
10/- each (previous year: 15/- per share) and 20.50 per share on 9,63,86,471 'A' Ordinary
Shares of 10/- each (previous year: 15.50 per share) fully paid-up and any further
Ordinary Shares and/or 'A' Ordinary Shares that may be allotted by the Company prior to
July 21, 2011 (being the book closure date for the purpose of the said dividend
entitlement) for 2010-11 and will be paid on or after August 16, 2011. The said dividend,
if approved by the Members, would involve a cash outflow of 1,467.03 crores (previous
year: 991.94 crores) resulting in a payout of 81% (previous year: 44%) of the standalone
profits of the Company.
OPERATING RESULTS AND PROFITS
After a good year 2009-10 during which economies across the world showed signs of
recovery, the economic conditions globally continued to be strong and positive in 2010-11,
resulting in a strong growth for the automotive sector. The Indian economy continued to do
well, driven by a good performance from the agricultural and the industrial sector with a
GDP growth of 8.6%. The automotive sector recorded a growth of over 26% in India on the
back of a robust economy.
Supported by its strong distinct product offerings in both the commercial vehicle and
passenger vehicle ranges, the Company recorded a turnover of 52,136 crores, a growth of
35.9% over the previous year. While the Company maintained a strong focus on cost control
and market pricing, the increase in raw -material cost and fixed marketing expenses
resulted in a lower EBITDA margin of 9.9% as compared to 11.7% in the previous year. The
Profit Before Tax and Profit After Tax for 2010-11 was 2,197 crores and 1,812 crores
respectively, as compared to 2,830 crores and 2,240 crores in the previous year. It may be
noted that the previous year profit included a net positive impact of 958 crores, mainly
on account of profit on certain divestments which was partly set off by a loss on
redemption of preference shares in a subsidiary company.
Jaguar Land Rover results for 2010-11 showed a significant improvement with increase,
both in volumes and revenue, better product mix, favourable exchange rates and higher
margins. The introduction of the new Jaguar XJ, growing momentum of the Range Rover and
Range Rover Sport and, in particular, the strengthening of the Jaguar Land Rover business
in China, where it opened a National Sales Company (NSC) in mid 2010, were the main
drivers. In addition, Jaguar Land Rover continued to benefit from cost efficiencies and
effective cash management initiatives adopted in response to the challenging operating
conditions in 2008 and 2009.
As the global markets recovered coupled with a strong focus on product and market
initiatives, particularly at Jaguar and Land Rover, the Tata Motors Group turnover in
2010-11 grew by 33.1% to 1,23,133 crores. Tata Motors Group recorded its highest ever
Consolidated Profit Before Tax of 10,437 crores (3,523 crores in 2009-10) and the
Consolidated Profit for the Year of 9,274 crores 2,571 crores in 2009-10).
VEHICLE SALES AND MARKET SHARES
The overall Tata Motors Group sales at 10,80,994 vehicles crossed the 1 million mark in
2010-11, higher by 24.2% compared to the previous year. Global sales of all commercial
vehicles were at 5,12,731 units, while global sales of all passenger vehicles were at
5,68,263 units.
The Company recorded sale of 7,78,540 vehicles in 2010-11, a growth of 22.8% over the
previous year in the Indian domestic market representing a 24.3% market share in the
Indian industry. It exported 58,089 vehicles from India, a growth of 70.3% over the
previous year.
The Company increased its commercial vehicle sales in the Indian market to an all time
high of 4,58,828 vehicles in 2010-11, representing a market share of 61.8%. A strong
product portfolio, improved reach and penetration in the market and focus on customer
oriented initiatives including finance enablement, ensured a 22.7% growth in commercial
vehicle sales. Some of the key highlights were:
- The Company crossed the 4 million cumulative vehicle sales mark for its commercial
vehicles.
- Sale of M&HCVs grew by 26.7% to 1,96,651 vehicles representing a market share of
60.1%. The Company continued to focus on customer centric initiatives, improved the sales
of the Prima, and launched product variants to strengthen its product offerings. The
Company introduced its CNG Hybrid city bus range and showcased it at the Commonwealth
Games in Delhi.
- Sale of LCVs grew by 19.9% to 2,62,177 vehicles representing a market share of 63.2%.
The new products launched such as the Ace EX, Super Ace and 407 Pickup helped increase the
sales. With competition entering the small commercial vehicles' segment, the market share
in the segment was lower as against last year.
The Company's sales of passenger vehicles in the Indian market (inclusive of Tata, Fiat
and Jaguar Land Rover brands) were at its highest ever at 3,19,712 vehicles, representing
a market share of 13.0% in 2010-11. The competition in the passenger car market continued
to increase with more international Automobile manufacturers entering the market with a
variety of product offerings. Some of the key highlights were:
- The Company crossed the 2 million cumulative vehicle sales mark for its passenger
vehicles.
- In June 2010, the Sanand plant for the production of the Nano was inaugurated. The
Company completed delivery on the bookings of the Nano and opened sales in various States
in a phased manner. Nano sales increased to 70,431 vehicles, a growth of 129% from 30,763
vehicles in the previous year. The Company focused on increasing the reach and penetration
for the Nano and also financing enablement for potential customer segments. The Nano
bagged the gold prize in the Best New Product segment under the transportation category at
the 2010 Edison Award, symbolizing persistence and excellence personified as also the
world's oldest and coveted international award for 'Good Design' in 2010 conferred by the
Chicago Athenaeum: Museum of Architecture and Design together with the European Centre for
Architecture Art Design and Urban Studies in the category of transportation.
- The sales in the Small Car segment (comprising the Nano, the Indica and the Vista)
increased to 1,80,091 vehicles, a growth of 13.9% representing a market share of 11.7%.
- The Indigo and the Indigo Manza sales were 87,919 vehicles. The Indigo eCS and the
Indigo Manza Elan variants launched in the year were well received in the market and
improved the Company's market share in the mid-size segment to 25.8% (after taking
Jaguar).
- In the Multi Utility Vehicles (MUV) segment, the Company sold 42,741 (including Land
Rovers) vehicles, a growth of 27.0% mainly boosted by sales of the Safari. The Aria - a
premium crossover and the Venture - a multi-purpose vehicle in this segment launched
during the year facilitated improvement in market share which stood at 13.2%.
- The Fiat sales were 20,342 vehicles representing a market share of 0.8% - with sales
of the 8,536 Lineas and 11,806 Grande Puntos.
- The Company sold 889 vehicles from the Jaguar Land Rover range in India and widened
its dealership network. It also began working on the local assembly for the Jaguar Land
Rover range in Pune which has since been operational from May 2011.
- Assisted by a recovery from the economic crisis in its key markets and a renewed
focus on exports, the Company's International Business grew by 70.3%. The Company exported
50,244 commercial vehicles, a growth of 80.2% and 7,845 passenger vehicles, a growth of
25.9% as compared to the previous year. The Company continues to keenly focus on
international markets and expects to launch its new product range in many of these
markets. An assembly plant in South Africa is being set up and is expected to start
production next year.
Jaguar Land Rover sold 2,43,621 vehicles in 2010-11 registering a growth of 25.6% with
sales of 52,993 Jaguars - a growth of 11.8% and 1,90,628 Land Rovers - a growth of 30.06%
over the previous year. Jaguar Land Rover's major international markets (U.S., U.K., China
and Germany) continued to do well and boosted sales of the Jaguar Land Rover range. The
new Jaguar XJ, deliveries of which started in the year, contributed significantly to the
growth of the Jaguar brand. Jaguar Land Rover also displayed the Jaguar C-X75 at the Paris
Motor Show and launched the all new XKR-S Jaguar at the Geneva Motor Show which received
rave reviews. The Range Rover - Evoque displayed at various auto shows and planned for
launch early next year, received rave accolades and is expected to translate the brand
identity of Range Rover so as to include small and very relevant products without
diminishing its brand value. Jaguar and Land Rover received more than 80 international
awards for its vehicles during 2010, which were shared equally between the two iconic
brands.
Jaguar Land Rover retail volumes in the U.K. totalled 58,134, a 1.9% increase over the
previous year whilst the retail volumes in the North America totalled 50,280 with Jaguar
and Land Rover volumes growing by 14.8% and 22.9% respectively over the previous year.
Retail volumes in key growth markets grew significantly with China at 28,893 and Russia at
11,689, higher by 69.9% and 32.4% respectively, over the previous year. There was moderate
growth in Europe of 6.2% resulting in retail volumes of 53,711 and across all other
markets of 38,198 representing a 15.7% growth over the previous year. Market Share of
Jaguar Land Rover in U.K., U.S., Europe, Russia and China were also either maintained or
marginally improved.
Tata Daewoo Commercial Vehicle (TDCV) sales were stagnant at 8,748 vehicles as compared
to 8,769 vehicles in the previous year. The financial instability of its sole distributor
in its domestic market in the previous year brought new challenges and opportunities. TDCV
started its own sales company to distribute its products in the Korean market and also
launched the Euro V compliant range of products.
Tata Hispano Motors Carrocera, S.A. sold 505 vehicles as compared to 248 units in the
previous year, increasing its market share to 13% from 8% in the previous year. It won a
prestigious order for supplying around 500 buses in the next 3 years to the Avanza Group,
one of the largest private passenger transportation groups in Spain.
Tata Motors Thailand (TMTL) continued to do well with sales of 6,031 vehicles against
2,536 vehicles in the previous year. The growth was driven by a good response to the Xenon
CNG model. TMTL also launched the Super Ace in the Thailand market.
CUSTOMER FINANCING INITIATIVES
The vehicle financing activity in India under the brand "Tata MotorFinance"
(TMF) of Tata Motors Finance Limited - a wholly owned subsidiary company, has shown
improvements in disbursements as well as net interest margins, driven mainly by the
overall economic recovery coupled with a strong focus by TMF on controlling costs,
improving quality of fresh acquisitions and micro-management of collections. TMF financed
1,60,781 vehicles during the year as compared to 1,44,806 vehicles in the previous year.
Total disbursements at 7,908 crores grew by 18% as against 6,697 crores in the previous
year. The disbursals for commercial vehicles were 6,041 crores (94,446 units) as compared
to 5,123 crores (96,593 units) and for passenger cars were 1,867 crores (66,335 units) as
compared to 1,454 crores (48,213 units) in the previous year. The market share in terms of
the Tata vehicles financed by TMF declined from 26% in Commercial vehicles to 21% and
increased from 21% to 22% in passenger cars. TMF's strategy on managing non-performing
assets (NPA), improving collection efficiencies, improvements in the "Risk Scored
Pricing Model" approach and thrust on customer relations through a branch based
re-organised field structure, has in the last 2 years turned around and improved its
operations and profitability, setting a robust platform to enable future growth.
Jaguar Land Rover have entered into arrangements with financial service providers to
make vehicle financing available to customers in 12 countries worldwide covering the
largest markets by volume, including Chase Auto Finance in the U.S. and FGA Capital (a
joint venture between Fiat Auto and Credit Agricole) in the UK and the rest of Europe.
HUMAN RESOURCES
The overall employee relations were peaceful and harmonious throughout the year. The
Company continued to create a productive, learning and caring environment by implementing
robust and comprehensive HR processes. 2010-11 saw the Company attracting substantial
talent to fill some key Senior Leadership positions. The permanent manpower headcount also
increased by 7% to 26,214. This increase in headcount supported the production and sales
of over 8 lakh vehicles. The productivity, in terms of the turnover per employee' has gone
up by 19.3% to ?96 lakhs / employee. The Commercial Vehicles Business Unit showed
consistent improvement over the years and is better than its competitors on all of the 8
HR Management parameters as rated by A C Nielsen.
The long term wage settlements were signed between the management and its unions at
locations where the settlements were due for negotiations. The bonus settlements at all
our plant locations were signed/announced in the month of September/October. The Tata
Motors Employees Union elections at Pune CVBU and PCBU were conducted peacefully on March
9, 2011, with new representatives being elected.
Jaguar Land Rover have generally enjoyed cordial relations with employees at their
factories and offices and have not had any strikes in the last eight years. More than 96%
of manufacturing shop floor workers and approximately 45% of salaried staff in the U.K.
are members of a labour union. Jaguar Land Rover signed a landmark settlement deal with
the Unions which would lead to the creation of new jobs in the next decade, including
1,500 jobs at its Halewood facility, Liverpool in 2011. Jaguar Land Rover is recognised as
a preferred employer in the U.K. and has won recognition in The Times "Top 100
Graduate Employers" for 2011; has won entry into The Times "Top 50 Employers for
Women" and "one to note" as a first time entry in The Times "Best
Companies" survey.
SAFETY & HEALTH - PERFORMANCE AND INITIATIVES
All of the Company's operating plants in India have been certified to OHSAS - 18001 and
ISO - 14001 standards and all the CVBU units have been conferred with the 'Golden Peacock
Award' on Safety & Health. Jamshedpur plant was adjudged first and was awarded by CII
(Confederation of Indian Industry) Eastern Region in Safety, Health & Environment
Practices. The Company took steps towards ensuring that every single individual working
within its plant premises is protected from any harmful impact of his/her working and the
inherent risks. Towards this end, the Company recently completed a diagnostic of the
existing safety systems through DuPont and is taking steps to raise the safety standards
to world class levels. ZAP (Zero Accident Plan) meetings are held all across plants and
the defined bay owners in these plants champion these meetings. Tata Marcopolo Motors
Limited would be implementing IMS - 18001/14001/9001 in both their plants in 2011-12 and
other initiatives to increase focus on safety, including conducting of periodical audits
to measure and ensure safety. A host of initiatives on health and wellness were taken
across all plants in India. Specifically, a Health Index was initiated in the Pune plant
and Ergonomics study carried out to improve workplace environment.
In overseas locations:
Jaguar Land Rover has robust health and safety management systems based on the U.K.
Health and Safety Executive's HSG 65 Standard for Successful Health and Safety Management.
Jaguar Land Rover are working to achieve the international health and safety certification
standard OHSAS 18001, on all sites, with the first stage of the certification process
completed during 2010. All Jaguar Land Rover employees receive health and safety training
as part of their induction and are kept up-to-date by weekly health and safety briefings,
quarterly occupational health and safety information bulletin, specific safety brief in
response to any significant incidents that occur, health and safety information on
dedicated safety notice boards at each site and campaigns to raise awareness of specific
risks or safety processes. Jaguar Land Rover also participates in awareness campaigns led
by the U. K. Health and Safety Executive and the European Agency for Safety and Health at
Work.
TDCV Korea achieved an accident rate of 0.30% (lower than the national average as well
as competitors) and is certified to OHSAS-18001 & ISO - 14001 Standards. Tata Hispano,
Spain achieved ISO - 14001 certification. Tata Motors (Thailand) Ltd. (TMTL) had Zero
accidents and also conducted specific training from equipment suppliers like wheel
alignment, overhead cranes, two/four post lifters, etc. to ensure safe and proper
operations by the workmen.
The above initiatives are in line with the Tata Motors Group's medium term goal to
emerge as a leader in safety in the Indian automobile industry and globally in the longer
horizon.
FINANCE
The borrowings of the Company as on March 31, 2011 stood at ?15,899 crores (previous
year 16,595 crores). Cash and Bank balances and Current investments in Liquid / Liquid
Plus schemes of Mutual funds stood at 2,514 crores (previous year 2,273 crores).
Tata Motors Group's borrowings as on March 31, 2011 stood at 32,791 crores (previous
year 35,108 crores). Cash and Bank balances and current investments in Liquid / Liquid
Plus schemes of Mutual funds stood at 12,071 crores (previous year 9,808 crores). The key
highlights were:- The Company issued rated, listed, secured/unsecured non-convertible
debentures of 900 crores with maturities of 10 - 15 years as a step to raise long term
resources and optimize the loan maturity profile.
- In October 2010, the Company raised funds aggregating 3,351 crores (US$ 750 million)
by an issue of 3,21,65,000 'A' Ordinary Shares at a price of 764/- per share and 83,20,300
Ordinary Shares at a price of 1,074/- per share to Qualified Institutional Buyers
('QIBs'), under a qualified institutional placement. The said issue was well received by
the investors and the Company availed of the opportunity to price it at the mid-upper
band. This milestone in the financing strategy enabled it to come closer to its objective
of balance sheet de-leveraging.
- Consequent upon the holders of Foreign Currency Convertible Notes (FCCNs) of
US$327.07 million and JP 30 million exercising their option to convert their FCCNs to
ordinary shares, the company alloted 23570426 ordinary shares
- The Company redeemed the 0% JP 720 million Convertible Notes as per the terms of
the issue which were remaining outstanding out of the 0% JP 11,760 million Convertible
Notes issued in 2006, the balance 93.9% of the said Notes being previously converted/
repurchased.
- Tranche 1 of the secured, rated, credit enhanced, listed 2% coupon non convertible
debentures aggregating ?800 crores was redeemed as per the terms of issue out of the 4
tranches of debentures aggregating ?4,200 crores issued in 2009-10.
- With a turnaround in the business and continuing strong profitability in 2010-11, the
net debt at Jaguar Land Rover reduced to GB 233 million. During the year, Jaguar Land
Rover took steps to establish hedging lines in order to reduce risks to the business from
foreign exchange fluctuations and establishing long term funding facilities in order to
strengthen the capital structure.
- Tata Motors Finance Ltd have raised ?361 crores by an issue of unsecured,
non-convertible, subordinated perpetual debentures towards Tier 1 and 2 Capital to meet
its growth strategy and improve its Capital Adequacy ratio.
Tata Motors Group's gross Debt/Equity ratio as at March 31, 2011 at 1.17 was
significantly lower as compared to 4.28 as on March 31, 2010.
The Company has undertaken and will continue to implement suitable steps for raising
long term resources to match the Company's fund requirement and to optimize its loan
maturity profile. The Company's rating for foreign currency borrowings was revised upwards
by Standard & Poor by 2 notches to BB- and by Moodys by 3 notches to Ba3. For
borrowings in local currency, the rating was revised upwards by 1 notch by Crisil at AA-,
by ICRA at LAA- and reaffirmed by CARE at AA-.
INFORMATION TECHNOLOGY INITIATIVES
Tata Motors Group continues to lead in the use of Information Technology as an integral
part of its strategy and goes beyond the organisation's boundaries to cover suppliers,
dealers and customers. The Company won an Architecture Excellence Award in the IT Service
Management category at the ICMG World Conclave. The Company's competitive advantage
includes a world class Customer Relations' Management solutions (CRM) with integrated
Dealer Management System (DMS) used by more than 2,500 channel partners. For receiving
customer requests and feedback, the Company has an enterprise SMS no. 5616161 and a
customer toll free no. 1800 209 7979. CRM capabilities are now being replicated in its
international operations. Major highlights of the year are:-
• Enhancement of the Call Center operation's capabilities to get benchmark
customer interaction performance, addition of Key Accounts Portal and deployment of Used
Vehicle and Customer Loyalty solution.
• Strengthening of IT support through distributed warehouse management and spares'
planning systems for its after market operations.
• Implementation of ERP for large and complex maintenance operations for the Delhi
Transport Corporation.
• Supplier self service with design collaboration solution extended to additional
550 vendors with more than 2,500 vendors.
• Use of manufacturing automation systems to run lean production operations with
advanced systems in plants for Nano and Ace.
• Expanded analytics and planning solutions to all key business functions with
plans to embrace advanced analytical capabilities.
• Jaguar Land Rover completed IT transition from Ford and launched multiple
strategic ERP programs.
• Jaguar Land Rover has commenced IT enhancements with the implementation of SAP
ERP software in the UK and SAP "all in one" in the National Sales Companies.
Jaguar Land Rover is also transforming its product development capabilities with new
toolsets, including Product Life Cycle Management (PLM).
• TDCV, Korea started its own sales and marketing operations, which went through
the ERP implementation to support retail sales and initiated centralized IT procurement to
leverage common contracts and terms.
The Tata Motors Group companies are collaborating on various fronts in the use of
Information Technology including deployment of state-of-the-art video conferencing system.
The Tata Technologies Group continues to be a strategic partner in strengthening the Tata
Motors Group IT capabilities.
NEW PRODUCT, TECHNOLOGY AND ENVIRONMENT FRIENDLY INITIATIVES Product Development
The Company strives to be at the forefront of innovation and works to launch products
aimed at the emerging needs of its customers. It continues to develop and build on its
in-house capabilities and works with the right partners to ensure that it has competitive
product offerings. Some of the Company's key products and initiatives for the year
include:
- Showcased the Tata Pixel - a concept for a future city car at the Geneva Motor Show.
- Launched the Aria - a premium crossover with high-end features such as 4x4, Torque on
Demand, ESP, six airbags.
- Launched the BS IV compliant variants of the Indica and the Indigo CS, the Indica eV2
and Indigo eCS with segment leading fuel efficiencies. These vehicles are powered by the
Company's 1.4L CRAIL engine.
- Launched Elan - a high end variant of the Indigo Manza sedan.
- Ace Zip and Magic Iris were test marketed in various parts of the country and are
expected to be formally launched across the country in May this year. This completes the
Ace family offerings now spanning from the Ace Zip and Magic Iris at the lower end and the
Super Ace and Venture on the higher end.
- Launched the Venture - a Multi Purpose Vehicle (MPV) on the Ace platform.
- The Prima range launched in the previous year was expanded with the introduction of
the Prima Construck range of tippers in the market. Some Prima trucks were also launched
in Korea and some of the tippers are soon expected to be launched in the international
markets.
- Jaguar Land Rover launched the all new Jaguar XJ, the new 4.4 V8 diesel Range Rover
and the new 2.2 diesel Land Rover -Freelander.
- Jaguar's Advanced Design Team and the Jaguar Land Rover Technical Innovation Team
created a concept car for the Paris Motor Show to celebrate 75 years of Jaguar Design and
Innovation. The resultant - a stunning Jaguar C-X75, is a radical combination of
hyper-car, eco-friendliness and 21st century technology, which won 'Car of the
Show' capturing the imagination of millions. Jaguar Land Rover recently announced their
partnership with Williams F1 to bring a version of this concept to the market in 2013.
- Tata Hispano Motors Carrocera, S.A., Spain introduced 4 new brand models of its
buses, viz. Area - an urban bus, 2 hybrid urban buses and Naya - a new deluxe coach. This
alongwith the Xerus and Intea models launched last year would expand its product range in
high-end buses/coaches.
Development of Environment Friendly Technologies
As a responsible automotive manufacturer, the Tata Motors Group continues to develop
vehicles and technologies to reduce its carbon footprint. Some of the significant
initiatives/achievements are:
- Showcased its CNG parallel Hybrid low-floor city buses in the Commonwealth Games in
Delhi.
- Tata Indica Vista EVX developed by engineers at our European subsidiary - Tata Motors
European Technical Centre, Plc, bagged 'the Most Economic Small Passenger EV' and 'the
Most Economical and Environment Friendly Small Passenger EV' under the Small Passenger EV
category at the inaugural Royal Automobile Club, Brighton to London Future Car Challenge.
- Migrated to meeting the BS IV emission norms by developing BS IV compliant range of
vehicles, in particular, Indica eV2 and Indigo eCS with 1.4L CRAIL engines with segment
leading fuel efficiencies.
- Jaguar and Land Rover continue to invest heavily in environmental innovation to
support delivery of the 2012 European Union requirement for reduction in CO2.
The 2010-11 new model launches including the all new Jaguar XJ, the new 4.4 V8 Diesel
Range Rover and the new 2.2 Diesel Land Rover - Freelander realised improvements in CO2
performance in excess of 10 %. The Jaguar XF and Range Rover Evoque to be launched in the
second quarter of 2011, would continue this trend. The Jaguar XF 2.2 Diesel 8 speed
automatic transmission variant with Stop/Start technology reduces the entry model CO2
output whilst the Evoque features a number of lightweight, vehicle efficiency and
Powertrain technologies that make this the most fuel efficient Range Rover ever.
- Jaguar Land Rover is working on introducing a new Premium Lightweight Architecture
for its products. This has seen a host of environment friendly technologies including new
aluminium alloys, down-sized powertrains, Eco HMI, sustainable materials, best-CO2
navigation routes, electronic power steering, aerodynamic features and many more
technologies. These technologies enable the delivery of class leading 'Luxury' and
'Performance' combined with low CO2 and lay the foundation for efficient
hybridization of the platform. Jaguar Land Rover's initial Full-Hybrid programme is also
in advanced stages.
- In 2010-11, some of the Plug-In Hybrid projects of Jaguar Land Rover were completed
and have provided the technical foundation for a production development programme for
Parallel Plug-in Hybrids. In addition, Jaguar Land Rover has made significant progress on
a number of ongoing collaborative Research and Development programmes investigating a wide
range of CO2 reduction technologies. These include radical combustion engine
downsizing/pressure charging, alternative power sources for Series Hybrids, Flywheel KERS
and waste energy recovery systems.
- Tata Hispano Motors Carrocera SA, Spain, won a prestigious order for supplying 10 CNG
Series Hybrid low-floor city buses, to be built on the Company's chassis, to EMT Madrid, a
Madrid city public transportation company.
CONSOLIDATED FINANCIAL STATEMENTS
The Tata Motor's Group reported consolidated revenues (net of excise) for 2010-11 of
123,133 crores, posting a growth of 33.1% over 92,519 crores in the previous year, with
strong volume growth globally in all major markets. The Consolidated Profit before Tax
(PBT) for the year was 10,437 crores, compared to a PBT of 3,523 crores for the previous
year. The Consolidated Profit for the period (After Tax and post minority interest and
profit in respect of Associate companies) for the year was 9,274 crores, a significant
increase from a profit of 2,571 crores in the previous year. As required under the Listing
agreement with the Stock Exchanges, Consolidated Financial Statements of the Tata Motors
Group (the Company and all its subsidiary companies) are attached.
Pursuant to the provisions of Section 212(8) of the Companies Act, 1956 (Act), the
Ministry of Corporate Affairs vide its General Circular No 2/2011 dated February 8, 2011
has granted a general exemption subject to certain conditions to holding companies from
complying with the provisions of Section 212 of the Act which requires the attaching of
the Balance Sheet, Profit & Loss Account and other documents of its subsidiary
companies to its Balance Sheet. Accordingly, the said documents are not being included in
this Annual Report. The main financial summaries of the subsidiary companies are provided
under the section 'Subsidiary Companies: Financial Highlights 2010-11' in the Annual
Report. The Company will make available the said annual accounts and related detailed
information of the subsidiary companies upon request by any member of the Company or its
subsidiary companies and the same will also be kept open for inspection by any member at
the Head Office of the Company and the subsidiary companies.
SUBSIDIARY AND ASSOCIATE COMPANIES Subsidiary Companies
The Company has 67 (direct and indirect) subsidiaries (10 in India and 57 abroad) as on
March 31, 2011 as disclosed in the accounts. During the year, the following changes have
taken place in subsidiary companies:
Subsidiary companies formed/acquired, etc.
• The Company acquired 80% stake in Trilix Srl., Turin (Italy), a design and
engineering company in September, 2010.
• Tata Precision Industries Pte. Ltd became a subsidiary after the Company
increased its shareholding from 49.99% to 78.39% by subscribing to an additional 28.4%
share of Tata Precision Industries Pte Ltd, Singapore on February 15, 2011. Tata Precision
Industries Pte Ltd holds 100% shares of Tata Engineering Services Pte Ltd, hence Tata
Engineering Services Pte Ltd also became a subsidiary.
• Tata Daewoo Commercial Vehicle Company Limited formed a wholly owned subsidiary,
Tata Daewoo Commercial Vehicle Sales and Distribution Company Limited.
• HV Axles Limited and HV Transmissions Limited, two of the Company's
subsidiaries, have announced an amalgamation to harness synergies and graduate to become a
total driveline solutions provider.
Companies ceasing to be subsidiary companies
• INCAT SAS, a subsidiary of Tata Technologies Limited was liquidated.
• Jaguar Land Rover Mexico SA de CV was sold to an importer.
Name changes
Carroseries Hispano Maghreb to Tata Hispano Motors Carroseries Maghreb.
Other than the above there has been no material change in the nature of the business of
the subsidiary companies.
Associate companies
As on March 31, 2011, the Company had 7 associate companies as disclosed in the
accounts:
FIXED DEPOSITS
The Company discontinued the acceptance and renewal of fixed deposits from the public
and shareholders with effect from May 28, 2010. During the year, it changed the Registrars
to the Fixed Deposit scheme to M/s. TSR Darashaw Limited (TSRDL) from M/s. Link Intime
India Private Limited. TSRDL are also the Registrars and Transfer Agents for shares and
debentures issued by the Company since past few decades and would thus be a focal point of
contact for all investor services. The Company has no overdue deposits other than
unclaimed deposits.
ENERGY, TECHNOLOGY & FOREIGN EXCHANGE
Details of energy conservation and research and development activities undertaken by
the Company along with the information in accordance with the provisions of Section
217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars
in the Report of Board of Directors) Rules, 1988, are given as an Annexure to the
Directors' Report.
DIRECTORS
Dr Ralf Speth was appointed as an Additional Director on November 10, 2010 in
accordance with Section 260 of the Companies Act, 1956 (the Act) and Article 132 of the
Company's Articles of Association and will cease to hold office at the forthcoming Annual
General Meeting and is eligible for appointment. In accordance with the provisions of the
Act and the Article of Association of the Company, M/s Ravi Kant, N N Wadia and S M Palia
are liable to retire by rotation and are eligible for re-appointment. Attention of the
Members is invited to the relevant items in the Notice of the Annual General Meeting and
the Explanatory Statement thereto.
Dr J J Irani, a Director nominated by Tata Steel Limited (Steel Director) and who is a
non-rotational Director as per Article 127 of the Company's Articles of Association, has
conveyed his decision to step down from the Company's Board from June 2, 2011 on attaining
75 years as per the Retirement policy of the Tata Group. Dr Irani was also a member of the
Company's Executive Committee of the Board. The Board of Directors in its meeting held on
May 26, 2011 expressed appreciation of the enormous contributions made by Dr Irani over
the years to the development and growth of the Company as also his good counsel in
charting its future direction.
CORPORATE GOVERNANCE
A separate section on Corporate Governance forming part of the Directors' Report and
the certificate from the Practicing Company Secretary confirming compliance of Corporate
Governance norms as stipulated in Clause 49 of the Listing Agreement with the Indian Stock
Exchanges is included in the Annual Report.
PARTICULARS OF EMPLOYEES
The Company has 99 employees who were in receipt of remuneration of not less than ?60
lakhs during the year or ?5 lakhs per month during any part of the said year. The
Information required under Section 217(2A) of the Companies Act, 1956 and the Rules made
thereunder is provided in the Annexure forming part of the Report. In terms of Section
219(1)(b)(iv) of the Act, the Report and Accounts are being sent to the shareholders
excluding the aforesaid Annexure. Any Shareholder interested in obtaining a copy of the
same may write to the Company Secretary.
CSR INITIATIVES
A separate section on initiatives taken by the Company to fulfill its Corporate Social
Responsibilities is included in the Annual Report.
AUDIT
M/s Deloitte Haskins & Sells (DHS), Registration No. 117366W, who are the Statutory
Auditors of the Company hold office until the conclusion of the ensuing Annual General
Meeting. It is proposed to re-appoint them to examine and audit the accounts of the
Company for the Financial Year 2011-12. DHS have, under Section 224(1) of the Act,
furnished a certificate of their eligibility for re-appointment.
Cost Audit
As per the requirement of the Central Government and pursuant to Section 233B of the
Act, the audit of the cost accounts relating to motor vehicles is carried out every year.
Pursuant to the approval of Ministry of Corporate Affairs (MCA) vide Sr. No.
52/413/CAB/1989 dated September 1, 2009, M/s Mani & Co. having registration No. 00004
were appointed as the Cost Auditors for auditing the Company's cost accounts relating to
motor vehicles for the financial year ended March 31, 2010. Consequent upon the audit
undertaken and submission of the Cost Audit Report dated August 10, 2010 and based on the
recommendation of the Audit Committee, the Board approved of the said Audit Report on
August 10, 2010 which was filed with the MCA on September 8, 2010.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 217 (2AA) of the Act, the Directors, based on the representation
received from the Operating Management, confirm that:- in the preparation of the annual
accounts, the applicable accounting standards have been followed and that there are no
material departures;
- they have, in the selection of the accounting policies, consulted the Statutory
Auditors and have applied them consistently and made judgments and estimates that are
reasonable and prudent so as to give a true and fair view of the state of affairs of the
Company at the end of the financial year and of the profit of the Company for that period;
- they have taken proper and sufficient care, to the best of their knowledge and
ability, for the maintenance of adequate accounting records in accordance with the
provisions of the Act, for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities;
- they have prepared the annual accounts on a going concern basis.
ACKNOWLEDGEMENTS
The Directors wish to convey their appreciation to all of the Company's employees for
their enormous personal efforts as well as their collective contribution to the Company's
performance. The Directors would also like to thank the employee unions, shareholders,
fixed deposit holders, customers, dealers, suppliers, bankers, Government and all the
other business associates for the continuous support given by them to the company their
confidence in its management
|
On behalf of the Board of Directors |
|
RATAN N TATA |
| Mumbai, May 26, 2011 |
Chairman |
ANNEXURE TO DIRECTOR'S REPORT
(Additional information given in terms of Notification 1029 of 31-12-1998 issued by the
Department of Company Affairs) A. Conservation of Energy
The Company has always been conscious of the need for conservation of energy and has
been steadily making progress towards this end. Energy conservation measures have been
implemented at all its plants and offices and special efforts are being put on undertaking
specific energy conservation projects such as:
• Installation of Variable Frequency Drives (VFD) for: electrical heating system
of Continuous Carburizing Hardening Furnace (CCHF) , cooling tower cold water pump motor,
clean room Air Supply Unit motor, etc;
• Switchover from electrical heating to LPG based heating system in washing
machines and aluminium melting furnace;
• Installation of CFL, LED bus bar indicators, 24Wx4 T5 lamps for street lights,
Electronic ballast and LED street lights;
• Switching off unwanted lights;
• Installation of Light pipes and Transparent Polycarbonate sheets;
• Installation of efficient Weishaupt Burners in plant and waste heat recovery
from furnace flue gases to heat water for process;
• Modification in PLC logic Top coat-2 oven cooling zone, optimization of
phosphate bath temperature, optimization of AC plant operations, installation of active
grill for data center AC system, to reduce electricity consumption;
• Installation of Energy Efficient Motors (Eff-1), Wind Ventilators, Super
magnetic dust separator; Downsizing of motors, Trimming of impeller of oversized water
recirculation pump, etc.
These changes have resulted in electrical energy saving of 1.93 crore units, reduction
in consumption of LDO fuel by 79KL and Propane by 194MT, leading to savings in cost of
around 10.43 crores and annual CO2 reduction of 17,401 tCO2 for the
Company.
In addition, the Company's endeavour of tapping wind energy has also made significant
contributions in:
• Generation of 527.1 lakh units from Wind Power resulting in savings of
electricity charges of 17.85 crores and reduction of CO2 by 48,620 tCO2.
• For the Company's 20.85MW Wind power project, United Nations Framework
Convention for Climate Change (UNFCCC) have issued 27,554 CERs on January 20, 2011 for the
period 2008-09.
Awards / Recognitions received during the year are as follows:
• The Company's CVBU Pune won the "GOLD" rating of Green Factory
Building Award from Indian Green Building Council (IGBC), which is first of its kind in
India and for the Tata Group. All the existing buildings are rated as GOLD rating factory
buildings in Pimpri. The Company is the first to receive this award for the existing
factory buildings.
• CVBU Pune was declared winner of 'Vasundhara Awards 2010' organised by the
Maharashtra Pollution Control Board (MPCB), winner of first prize in Technical Paper
Contest at INSSAN Regional Convention 2010 of INSSAN (Indian National Suggestion Schemes'
Association) - Eastern India Chapter. It also received the Excellent Energy Efficient Unit
award in the CII 11th National Awards for Excellence in Energy Management - 2010.
• The Company won the Srishti G-Cube Awards for Good Green Governance in
Manufacturing - Engineering category, CVBU Pune was the winner, Jamshedpur Plant was
declared ''runner up'', and Pantnagar Plant received a ''certificate of commendation''.
• CVBU Lucknow was adjudged the Excellent Energy Efficient Unit for the second
time in a row at the 11th National Awards for Excellence in Energy Management 2010,
conducted by CII - Godrej Green Business Centre at Chennai. It also received the Silver
Award in the automobile sector at the 11th Global Green Tech Excellence Awards 2010 and
awarded the first prize in the National Energy Conservation Award (NECA) 2010, in the
Automobile Sector, at New Delhi.
• Pantnagar Plant received the first prize in the Uttarakhand State Energy
Conservation Award 2010, under the Large and Medium scale industry category. It was also
awarded the second prize at the National Energy Conservation Awards (NECA) 2010, under the
Automobile Manufacturing Sector. This is the consecutive second year that the Plant has
received this National Award.
B. Technology Absorption
The Company has continued its endeavor to absorb the best of technologies for its
product range to meet the requirements of a globally competitive market. All of its
vehicles and engines are compliant with the prevalent regulatory norms in India and also
in the countries to which they are exported. It has also undertaken programs for
development of vehicles which would run on alternate fuels like LPG, CNG, Bio-diesel,
Electric traction etc.
Major Technology absorption projects undertaken during last year include:
| Technology For |
Status |
| Development of Navigation system on Aria |
|
| Vehicle vibration reduction during shut-down of engine for Aria and Magic Iris by
using high damping SBR engine-mounts |
Implemented in production |
| For In-cab noise reduction of Xenon, Super-Ace and Venture, tuning of a Torsional
Vibration Damper [TVD] |
|
| Inflatable curtains for side impact protection |
Implemented |
| Parallel Hybrid Technology for Buses |
Under Implementation |
| Technology for indigenized high temperature cables developed for use on vehicles |
|
| EE - Architecture Development methodology for vehicles |
Development in progress |
| Symptom Driven Diagnostics development for vehicles |
|
During the year, the Company filed 141 Patent Applications and 41 Design applications.
In respect of applications filed in earlier years, 11 Patents were granted and 36 Designs
were registered.
To reinforce the need for technology up-gradation to attain international levels of
competitiveness and to be able to offer contemporary products, the Company invested in
facilities for vehicle level performance development, various optimisation and emission
measurements, for validating safety requirements, and meeting various evolving regulatory
requirements in domestic and international markets, such as:
• Heavy duty chassis dynamometers for vehicle level performance development and
various calibrations for Utility Vehicles and Passenger Cars.
• Heavy duty chassis dynamometers for performance development and various
calibrations for Medium and Heavy commercial vehicles and 440 kW Dynamic transient
dynamometer and allied auxiliary equipment.
• Robotic driver mileage accumulation for light, medium and heavy commercial
vehicles.
• Enhancement of Chassis Dynamometer Emission Lab for passenger cars and small
commercial vehicles for Euro V emission norms onward. This lab is upgraded with new
48" chassis dynamometer as per regulatory requirements and advanced emissions
measurement systems.
• Facilities and equipment to meet safety regulations such as mobile crash test
barrier for side impact testing (as per US regulations), Rear impact testing (as per
Korean regulation). Introduction of xenon -ve arc, flicker free lighting system for high
speed digital photography during crash events.
• Hardware in Loop (H.I.L.) set up for body cluster module development.
• Rapid prototyping equipment with selective laser sintering (SLS) technology for
'ready to test' plastic prototype parts.
• Eight poster road load simulator for vehicle structural durability of Medium and
Heavy commercial vehicles.
Investments are also made to upgrade the existing facilities through addition of
various data acquisition systems and analysis software for Road Load Data collection, NVH
testing, engines related testing and calibration and enhancement of automation of test
beds.
Major Technology imports include:
| Technology for |
Year of Import |
Status |
| Development and application of a two cylinder common rail diesel engine for small
passenger car and small commercial vehicles. |
2007- 08 |
Completed |
|
2008- 09 |
|
|
2009- 10 |
|
| Gas Injection technology for LCV, MCV and HCV engines |
2009-10 |
Under Development |
| Stop-Start feature for various vehicle platforms |
2009-10 |
In progress |
| Engine Management for Series Hybrid Technology for Buses |
2009-10 |
Under Development |
| Design and Development of New Generation engine platforms for LCVs and UVs |
2006-07 |
Completed |
| Design and Development of Infinitely variable transmission based on full toriodal
traction-drive variators for various vehicle platforms. |
2007-08 |
Under implementation |
| Design and Development of Electric Hatchback in windows vehicle - Indica Vista EV |
2008-09 |
Under implementation |
During the year the Company spent ?1,187.21 crores on Research and Development
activities including expenditure on capital assets purchased for Research and Development
which was 2.47% of the net turnover.
C. Foreign Exchange Earnings and Outgoing
(ln crores)
| Earning in foreign currency |
3,358.64 |
| Expenditure in foreign currency (including dividend remittance) |
3,180.17 |
|