MIRA INFORM REPORT

Report Date :

30.08.2013

IDENTIFICATION DETAILS

Name :	HERO MOTOCORP LIMITED (JULY, 2011)
Formerly Known As :	HERO HONDA MOTORS LIMITED
Registered Office :	34, Community Centre, Basant Lok, Vasant Vihar, New Delhi - 110057
Country :	India
Financials (as on) :	31.03.2013
Date of Incorporation :	19.01.1984
Com. Reg. No.:	55-017354
Capital Investment / Paid-up Capital :	Rs.399.400 Millions
CIN No.: [Company Identification No.]	L35911DL1984PLC017354
TAN No.: [Tax Deduction & Collection Account No.]	DELH00028A
PAN No.: [Permanent Account No.]	A AACH0812J
Legal Form :	A Public Limited Liability company. The company’s Shares are Listed on the Stock Exchange.
Line of Business :	The Company is engaged in the manufacturing and selling of motorised two-wheelers spares parts and related services.
No. of Employees :	5257 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

Aa (76)

RATING		STATUS	PROPOSED CREDIT LINE
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large

Maximum Credit Limit :	USD 200240000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a part of hero group. It is well established company having good track record. Financially company is performing good. It is reputed company created it brand all over. Trade relations are reported to be fair. Business is active. Payments are reported to be regular and as per commitment. The company can be considered for normal business dealings at usual trade terms and conditions.

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

ECGC Country Risk Classification List – March 31^st, 2013

Country Name	Previous Rating (31.12.2012)	Current Rating (31.03.2013)
India	A1	A1

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

INDIAN ECONOMIC OVERVIEW

We are living in a world where volatility and uncertainty have become the New Normal. We saw a change of government in countries like Tunisia, Egypt, Libya and Vietnam. Once powerful countries in Europe are now fighting for bankruptcy. We have taken growth in the developing part of the world for granted but economic growth in China and India has begun to slow. Companies that were synonymous with their product categories just a few years ago are now no longer in existence. Kodak, the inventor of the digital camera had to wind up its operations, HMV, the British entertainment retailing company and Borders, once the second largest bookstore have shut down due to their inability to evolve their business models with the changing time. Readers’ Digest, Thomson Register are no more !

There is another megatrend happening. The World order is changing as economic power shifts from West to East. According to McKinsey study, it took Britain more than 100 years to double its economic output per person during its industrial revolution and the US later took more than 50 years to do the same. More than a century later, China and India have doubled their GDP per capital in 12 and 18 years respectively. By 2020, emerging Asia will become the world’s largest consuming block, overtaking North America.

The years after the outbreak of the global financial crisis, the world economy continues to remain fragile. The Indian economy demonstrated remarkable resilience in the initial years of the contagion but finally lost ground last year. GDP growth slowed down. Currency has been weakening. There is a marked deceleration in agriculture, industry and services. Dampening sentiment led to a cut-back in investment as well as private consumption expenditure.  Inflation remained at high levels fuelled by the pressure from the food and fuel sectors. The large fiscal and current account deficit s continued to cause grave concern. It is imperative that India regains its growth trajectory of 8-9 % sooner than later. This is crucially important given the need to create gainful livelihood opportunities for the millions living in poverty as also the large contingent of young people joining the job market every year.

EXTERNAL AGENCY RATING

Rating Agency Name	CRISIL
Rating	Long term rating AAA
Rating Explanation	Having a highest degree of safety regarding timely servicing of financial obligation. It carry lowest credit risk.
Date	March 2013

RBI DEFAULTERS’ LIST STATUS

Subject’s name is not enlisted as a defaulter in the publicly available RBI Defaulters’ list.

EPF (Employee Provident Fund) DEFAULTERS’ LIST STATUS

Subject’s name is not enlisted as a defaulter in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of 31-03-2012.

LOCATIONS

Registered Office / Corporate Office :	34, Community Centre, Basant Lok, Vasant Vihar, New Delhi – 110057, India
Tel. No.:	91-11-26142451 / 26144121 / 46044100
Fax No.:	91-11-26143321 / 26143198
E-Mail :	ilam.kamboj@heromotocorp.com dinesh.gupta@heromotocorp.com rakesh.maharaj@heromotocorp.com
Website :	http://www.heromotocorp.com
Plant 1 :	Dharuhera Plant 69 K.M. Stone, Delhi-Jaipur Highway, Dharuhera, District Rewari - 122 100 Haryana, India
Tel. No.:	91-1274-264 000
Fax No.:	91-1274-267 018
Plant 2 :	Gurgaon Plant 37 K.M. Stone, Delhi-Jaipur Highway, Sector 33, Gurgaon – 122 001 Haryana, India
Tel. No.:	91-124-2894200/2372123
Fax No.:	91-124 2373 141/42
Plant 3 :	Haridwar Plant Plot No. 3, Sector 10, I.I.E., SIDCUL, Roshanabad, Haridwar – 249 403, Uttarakhand, India
Tel. No.:	91-1334-238500/239514-16
Fax No.:	91-1334-239512-13

DIRECTORS

As on: 31.03.2013

Name :	Mr. Brijmohan Lall Munjal
Designation :	Chairman
Name :	Mr. Pawan Munjal
Designation :	Managing Director and Chief Executive Officer
Name :	Mr. Sunil Kant Munjal
Designation :	Joint Managing Director
Name :	Mr. Suman Kant Munjal
Designation :	Non-Executive Director
Name :	Mr. Paul Edgerley
Designation :	Non-Executive Director
Name :	Mr. Pradeep Dinodia
Designation :	Non-Executive and Independent Director
Name :	Gen. (Retd.) V. P. Malik
Designation :	Non-Executive and Independent Director
Name :	Mr. Analjit Singh
Designation :	Non-Executive and Independent Director
Name :	Dr. Pritam Singh
Designation :	Non-Executive and Independent Director
Name :	Mr. M. Damodaran
Designation :	Non-Executive and Independent Director
Name :	Mr. Ravi Nath
Designation :	Non-Executive and Independent Director
Name :	Dr. Anand C. Burman
Designation :	Non-Executive and Independent Director

KEY EXECUTIVES

Audit Committee
Name :	Mr. Pradeep Dinodia
Designation :	Chairman
Name :	Gen. (Retd.) V. P. Malik
Designation :	Member
Name :	Dr. Pritam Singh
Designation :	Member
Name :	Mr. M. Damodaran
Designation :	Member
Shareholders’ Grievance Committee
Name :	Dr. Pritam Singh
Designation :	Chairman
Name :	Mr. Pradeep Dinodia
Designation :	Member
Name :	Mr. M. Damodaran
Designation :	Member
Remuneration Committee
Name :	Gen. (Retd.) V. P. Malik
Designation :	Chairman
Name :	Mr. Pradeep Dinodia
Designation :	Member
Name :	Mr. Ravi Nath
Designation :	Member
Senior Management Team
Name :	Mr. Ravi Sud
Designation :	Sr. Vice President and Chief Financial Officer
Name :	Mr. Anil Dua
Designation :	Sr. Vice President-Sales and Marketing
Name :	Mr. Vikram Kasbekar
Designation :	Head-Operations and Supply Chain
Name :	Mr. Neeraj Mathur
Designation :	Vice President-Strategic Sourcing and Supply Chain
Name :	Dr. Anadi S. Pande
Designation :	Vice President-HRM, Corporate Planning and Strategy
Name :	Mr. Vijay Sethi
Designation :	Vice President-Information Systems
Compliance Officer
Name :	Mr. Ilam C. Kamboj
Designation :	Sr. General Manager - Legal and Company Secretary

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on: 30.06.2013

Category of Shareholder	Total No. of Shares	Total Shareholding as a % of Total No. of Shares
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Individuals / Hindu Undivided Family	420650	0.21
Bodies Corporate	103838840	52.00
Sub Total	104259490	52.21
(2) Foreign
Total shareholding of Promoter and Promoter Group (A)	104259490	52.21
(B) Public Shareholding
(1) Institutions
Mutual Funds / UTI	1702850	0.85
Financial Institutions / Banks	3434756	1.72
Insurance Companies	13348719	6.68
Foreign Institutional Investors	59601538	29.85
Sub Total	78087863	39.11
(2) Non-Institutions
Bodies Corporate	2820049	1.41
Individuals
Individual shareholders holding nominal share capital up to Rs. 0.100 million	12292585	6.16
Individual shareholders holding nominal share capital in excess of Rs. 0.100 million	687251	0.34
Any Others (Specify)	1540262	0.77
Non Resident Indians	249281	0.12
Clearing Members	405094	0.20
Trusts	885887	0.44
Sub Total	17340147	8.68
Total Public shareholding (B)	95428010	47.79
Total (A)+(B)	199687500	100.00
(C) Shares held by Custodians and against which Depository Receipts have been issued	0	0.00
(1) Promoter and Promoter Group	0	0.00
(2) Public	0	0.00
Sub Total	0	0.00
Total (A)+(B)+(C)	199687500	0.00

BUSINESS DETAILS

Line of Business :

The Company is engaged in the manufacturing and selling of motorised two-wheelers spares parts and related services.

Products :

Product Description	Item Code No.
Motorised two wheelers upto 350cc engine capacity	87112003

GENERAL INFORMATION

No. of Employees :	5257 (Approximately)
Bankers :	The Royal Bank of Scotland NV Bank of America NA Citibank N.A. HDFC Bank Limited Hong Kong and Shanghai Banking ICICI Bank Limited Punjab National Bank Standard Chartered Bank The Bank of Tokyo-Mitsubishi UFJ Limited Kotak Mahindra Bank Limited Yes Bank Limited

Banking Relations :	--
Statutory Auditors :
Name :	Deloitte Haskins and Sells Chartered Accountant
Address :	7th Floor, Building No. 10, Tower B, DLF Cyber City Complex, DLF City Phase- II, Gurgaon – 122 002, Haryana, India
Tel. No.:	91- 124-679 2000
Fax No.:	91- 124-679 2012
E-Mail Id :	www.deloittee.com/in
Cost Auditors :
Name :	Ramanath Iyer and Company Chartered Accountants
Address :	BL - 4, (Paschmi), Shalimar Bagh, Delhi - 110088, India
Tel. No.:	91-11-2748 1904, 4702 8048
Fax No.:	91-11-2748 1904
E-Mail Id :	arrricon@rediffmail.com arrricon@gmail.com
Parties in respect of which the Company is an associate :	Ø Hero Investment Private Limited
Associate :	Ø Hero FinCorp Limited (formally called Hero Honda Finlease limited)
Enterprises over which key management personnel and their relatives are able to exercise significant influence :	Ø Brijmohan Lall and Associates Ø A.G. Industries Private Limited Ø Highway Industries Limited Ø Rockman Industries Limited Ø Cosmic Kitchen Private Limited Ø Hero Management Services Limited Ø Hero Cycles Limited Ø Hero Corporate Services Limited Ø Hero Mindmine Institute Limited Ø Easy Bill Limited and Raman Kant Munjal Foundation

CAPITAL STRUCTURE

As on: 31.03.2013

Authorised Capital :

No. of Shares	Type	Value	Amount
250000000	Equity Shares	Rs.2/- each	Rs.500.000 Millions
400000	Cumulative Convertible Preference Shares	Rs.100/- each	Rs.40.000 Millions
400000	Cumulative Redeemable Preference Shares	Rs.100/- each	Rs.40.000 Millions
	Total		Rs.580.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
199687500	Equity Shares	Rs.2/- each	Rs.399.400 Millions

FINANCIAL DATA

[all figures are in Rupees Millions]

.

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS	31.03.2013	31.03.2012	31.03.2011
I. EQUITY AND LIABILITIES
(1)Shareholders' Funds
(a) Share Capital	399.400	399.400	399.400
(b) Reserves & Surplus	49663.000	42498.900	29161.200
(c) Money received against share warrants	0.000	0.000	0.000
(2) Share Application money pending allotment	0.000	0.000	0.000
Total Shareholders’ Funds (1) + (2)	50062.400	42898.300	29560.600
(3) Non-Current Liabilities
(a) long-term borrowings	0.000	0.000	0.000
(b) Deferred tax liabilities (Net)	1324.100	2082.600	2467.700
(c) Other long term liabilities	3021.600	10113.900	14710.400
(d) long-term provisions	301.600	380.000	356.800
Total Non-current Liabilities (3)	4647.300	12576.500	17534.900
(4) Current Liabilities
(a) Short term borrowings	0.000	0.000	0.000
(b) Trade payables	18733.400	22931.700	20733.000
(c) Other current liabilities	8876.400	9962.000	28980.200
(d) Short-term provisions	14097.000	10520.700	10453.900
Total Current Liabilities (4)	41706.800	43414.400	60167.100
TOTAL	96416.500	98889.200	107262.600
II. ASSETS
(1) Non-current assets
(a) Fixed Assets
(i) Tangible assets	18917.600	17431.400	16125.300
(ii) Intangible Assets	11792.200	20423.700	24677.500
(iii) Capital work-in-progress	620.900	388.400	499.600
(iv) Intangible assets under development	0.000	0.000	0.000
(b) Non-current Investments	6144.700	6739.600	4654.600
(c) Deferred tax assets (net)	0.000	0.000	0.000
(d) Long-term Loan and Advances	7800.600	5336.400	3422.900
(e) Other Non-current assets	364.400	260.100	164.300
Total Non-Current Assets	45640.400	50579.600	49544.200
(2) Current assets
(a) Current investments	30093.600	32903.000	46632.900
(b) Inventories	6367.600	6755.700	5249.300
(c) Trade receivables	6650.000	2723.100	1305.900
(d) Cash and cash equivalents	1810.400	768.200	715.200
(e) Short-term loans and advances	5535.500	4756.000	3447.200
(f) Other current assets	319.000	403.600	367.900
Total Current Assets	50776.100	48309.600	57718.400
TOTAL	96416.500	98889.200	107262.600

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2013	31.03.2012	31.03.2011
	SALES
		Income	237681.100	235790.300	193979.300
		Other Income	3983.800	3645.700	2896.200
		TOTAL	241664.900	239436.000	196875.500
Less	EXPENSES
		Cost of materials consumed	173648.600	173654.100	141351.700
		Changes in inventories of finished goods and work-in-progress	328.000	(838.400)	(240.600)
		Employee benefits expenses	8209.200	7355.200	6189.500
		Other expenses	22650.500	19431.600	20553.400
		TOTAL	204836.300	199602.500	167854.000
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION		36828.600	39833.500	29021.500
Less	FINANCIAL EXPENSES		119.100	213.000	151.700
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION		36709.500	39620.500	28869.800
Less/ Add	DEPRECIATION/ AMORTISATION		11417.500	10973.400	4023.800
	PROFIT BEFORE EXCEPTIONAL ITEMS AND TAX		25292.000	28647.100	24846.000
	EXCEPTIONAL ITEMS		0.000	0.000	798.400
	PROFIT BEFORE TAX		25292.000	28647.100	24047.600
Less	TAX		4110.400	4865.800	4769.600
	PROFIT AFTER TAX		21181.600	23781.300	19279.000
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		25385.700	14448.000	21465.500
Less	APPROPRIATIONS
		Dividend - Interim - Proposed Final	-- 11981.300	-- 8985.900	13978.100 6989.100
		Corporate Tax on Dividend	2036.200	1457.700	3401.400
		Transfer to General Reserve	2150.000	2400.000	1927.900
	BALANCE CARRIED TO THE B/S		30399.800	25385.700	14448.000
	EARNINGS IN FOREIGN CURRENCY
		FOB value of exports	6202.400	5986.400	4442.300
		Freight and Insurance	42.200	9.100	3.900
	TOTAL EARNINGS		6244.600	5995.500	4446.200
	IMPORTS
		Raw Materials*	367.000	145.600	214.200
		Components, spare parts and others *	10111.600	9237.300	7523.800
		Capital Goods	1060.900	840.300	633.200
	TOTAL IMPORTS		11539.500	10223.200	8371.200
	Earnings Per Share (Rs.)		106.07	119.09	96.54

* Includes items sold to ancillaries on cost to cost basis for assembling of components.

KEY RATIOS

PARTICULARS		31.03.2013	31.03.2012	31.03.2011
PAT / Total Income	(%)	8.76	9.93	9.79
Net Profit Margin (PBT/Sales)	(%)	10.64	12.15	12.40
Return on Total Assets (PBT/Total Assets}	(%)	31.04	33.25	24.41
Return on Investment (ROI) (PBT/Networth)		0.51	0.67	0.80
Debt Equity Ratio (Total Debt /Networth)		0.00	0.00	0.00
Current Ratio (Current Asset/Current Liability)		1.22	1.11	1.95

LOCAL AGENCY FURTHER INFORMATION

Sr. No.	Check List by Info Agents	Available in Report (Yes / No)
1]	Year of Establishment	Yes
2]	Locality of the firm	Yes
3]	Constitutions of the firm	Yes
4]	Premises details	No
5]	Type of Business	Yes
6]	Line of Business	Yes
7]	Promoter's background	No
8]	No. of employees	Yes
9]	Name of person contacted	No
10]	Designation of contact person	No
11]	Turnover of firm for last three years	Yes
12]	Profitability for last three years	Yes
13]	Reasons for variation <> 20%	----------------------
14]	Estimation for coming financial year	No
15]	Capital in the business	Yes
16]	Details of sister concerns	Yes
17]	Major suppliers	No
18]	Major customers	No
19]	Payments terms	No
20]	Export / Import details (if applicable)	No
21]	Market information	----------------------
22]	Litigations that the firm / promoter involved in	----------------------
23]	Banking Details	Yes
24]	Banking facility details	Yes
25]	Conduct of the banking account	----------------------
26]	Buyer visit details	----------------------
27]	Financials, if provided	Yes
28]	Incorporation details, if applicable	Yes
29]	Last accounts filed at ROC	Yes
30]	Major Shareholders, if available	Yes
31]	Date of Birth of Proprietor/Partner/Director, if available	No
32]	PAN of Proprietor/Partner/Director, if available	No
33]	Voter ID No of Proprietor/Partner/Director, if available	No
34]	External Agency Rating, if available	Yes

INDEX OF CHARGES:

S.No.	Charge ID	Date of Charge Creation/Modification	Charge amount secured	Charge Holder	Address	Service Request Number (SRN)
1	80065350	11/08/2005	400,000,000.00	HDFC BANK LIMITED	KAILASH BUILDING , 26, K.G. MARG, NEW DELHI - 110001, INDIA	-
2	80065345	28/10/1998 *	628,000,000.00	PUNJAB NATIONAL BANK	ECE HOUSE, KASTURBA GANDHI MARG, NEW DELHI, - 110001, INDIA	-
3	90335393	06/01/1996 *	28,000,000.00	PUNJAB NATIONAL BANK	K.G. MARG, NEW DELHI, Delhi, INDIA	-
4	80065346	02/06/1989	80,000,000.00	PUNJAB NATIONAL BANK	ECE HOUSE, KASTURBA GANDHI MARG, NEW DELHI - 110001, INDIA	-
5	80065347	28/06/1996 *	80,000,000.00	PUNJAB NATIONAL BANK	ECE HOUSE, KASTURBA GANDHI MARG, NEW DELHI - 110001, INDIA	-

* Date of charge modification

CORPORATE INFORMATION

Subject is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956 on January 19, 1984. The name of the Company has been changed from Hero Honda Motors Limited to Subjection July 29, 2011. The shares of the Company are listed on two stock exchanges in India i.e. National Stock Exchange (NSE) and Bombay Stock Exchange (BSE). The Company is engaged in the manufacturing and selling of motorized two-wheelers spares parts and related services. The Company is a leading two wheeler manufacturer and has a dominant presence in domestic market.

GLOBAL ECONOMY

During FY 2012-13, the global economy had few reasons to cheer as Europe lurched from one crisis to another and emerging economies grappled with unpredictable roadblocks to their hitherto smooth economic growth. BRICS economies also ran into turbulent weather, with each member nation, including China making a desperate attempt to arrest sliding growth. China registered 7.7% growth in the first quarter of 2013, as against 7.9% in the corresponding quarter of 2012.

Although China remained the fastest growing major economy in the world, India finished the year a close second with 5% GDP growth and Russia (3.4%), South Africa (2.5%) and Brazil (0.9%) trailing behind. However, the over 15 trillion dollar US economy continued to perform better on all macro-economic fundamentals, keeping alive moderate optimism for a growth-hungry developed world. With debt default concern looming over the Eurozone, the confidence of investors in the US economy and dollar is rising considerably.

Easy growth is not on the horizon for economies and businesses around the world. Therefore, global corporations are increasingly investing in technology and innovations to improve their competitiveness and foray into pristine markets. New markets are emerging in South Asia, Africa and Latin and Central America, with enhanced focus by governments on improving infrastructure, educational standards, healthcare and the overall quality of life.

INDIAN ECONOMY

The Indian economy went through upheavals owing to global distress and persistent domestic turbulence; challenges comprised firm inflation, high fiscal deficit, lack of liquidity in the economy, policy uncertainty and currency volatility, leading to a bleak investment scenario. India’s Gross Domestic Product (GDP) growth rate moderated in 2012-13, owing to the underperformance by almost all sectors of the economy. In addition, the Rupee’s historic plunge against the US dollar has made the markets jittery and the government worried.

RECOVERY INITIATIVES

The Reserve Bank of India injected liquidity into the market during the year under review by lowering interest rates in phases in order to spur investment and catalyse economic growth. The government’s fiscal consolidation measures seem to have yielded some results. Fiscal deficit declined to 4.89% in 2012-13, as compared to 5.76% in 2011-12, while wholesale monthly inflation also came down to 4.7% in May, 2013 from 8% in 2012-13. India’s current account deficit moderated to 3.6% of GDP in January-March 2013 from a record high of 6.7% in October-

December 2012.

OUTLOOK

Going forward, the Reserve Bank of India may continue to ease interest rates in a phased manner to support growth, provided the depreciating rupee doesn’t put undue pressure on inflation. The IMF expects India’s growth rates to pick up pace slowly but steadily, starting from 6.5 % in 2013-14 to 6.7% in 2014-15.

TWO-WHEELER INDUSTRY

During 2012-13, the two-wheeler industry lost the growth momentum it created over the last few years. Sales grew marginally by 2.3%, with 15.8 million units of sales in 2012 - 13, compared to 15.4 million units in 2011-12. Motorcycle volumes—which make up the bulk of the industry — grew by just 0.1% from 11.91 million units in 2011-12 to 11.95 million units in 2012 -13. Similarly, sales of mopeds grew by 0.8%, from 0.78 million units in 2011-12 to 0.79 million units in 2012-13. The scooter category was the industry’s only bright spot, with 12.4% growth in sales, from 2.73 million units in 2011-12 to 3.07 million units in 2012-13.

EXPORTS

For the two-wheeler industry as a whole, export sales declined by 0.3% to 1.8 million units—an indication of the difficult economic conditions around the world.

OPERATIONAL PERFORMANCE

In 2012-13, Hero MotoCorp sold 6.07 million units compared to 6.23 million units in the previous year. This was on account of poor rains, firm interest rates, high fuel prices and heightened caution on the part of customers across the two-wheeler industry.

In the dominant motorcycle segment, Hero MotoCorp with sales of 5.5 million units, continued to lead the domestic market with 46% market share. This, however, was marginally lower than the 48.4% market share in 2011-12.

Sales in the domestic motorcycle market remained flat at 10.08 million units, compared to 10.07 million units in the previous year. In the Indian market, Hero MotoCorp captured 53.2% market share, with sales of 5.3 million units. Despite the slowdown, the Company sold more than the second, third and fourth placed motorcycle manufacturers in India taken together during the year.

EXPORTS

Hero MotoCorp, with sales of over 1,36,000 units, accounted for 7.3% of motorcycle exports from India.

HERO MOTOCORP’S INTERNATIONAL FOCUS

During 2012-13, the Company exported 1,61,043 units as compared to 1,65,925 units the previous year resulting in a decline of 2.94%. Moreover, the Company exported spare parts worth Rs.38.38 millions depicting a growth of 16% over the previous year. The growth came as a result of distributor realignments in existing markets, launches across Sri Lanka and Nepal, increased promotional activities in Bangladesh and a stronger focus on the Columbian market.

In 2012-13, the Company prepared the template for an ambitious international foray covering the countries of Africa, Latin America and Central America. At the time of writing the Report, Hero MotoCorp’s first consignments to new international markets across these geographies had been well received.

STANDALONE UNAUDITED FINANCIAL RESULTS FOR THE QUARTER ENDED JUNE 30, 2013

(Rs. In Millions)

Particulars	Quarter ended June 30, 2013
PART I	Unaudited
No. of Two wheelers sold	155928.200
Income from Operations
(a) Net sales/ Income from Operations ( Net of excise duty)	61268.400
(b)Other Operating Income	3,26.800
Total Income from operations (net)	61595.200
Expenses
[a] Cost of materials consumed	44702.900
[b] Change in inventories of finished goods and work-in-progress	(146.800)
[c] Employees benefits expenses	2215.000
[d] Depreciation and amortisation expenses	2743.800
[e] Other expenses	5671.900
Total Expenses	55186.800
Profit from Operations before Other Income, Finance cost (1 -2)	6408.400
Other Income	1122.600
Profit before finance costs (3+4)	7531.000
Finance costs	29.500
Profit before tax (5-6)	7501.500
Tax expense	2015.700
Net Profit for the period (7-8)	5485.800
Paid-up Equity Share Capital	399.400
Face value of the share (Rs.)	2.00
Reserves excluding Revaluation Reserve
Basic and diluted earnings per share face value Rs. 2/- each (In Rupees)	27.47

SELECT INFORMATION FOR THE QUARTER ENDED JUNE 30, 2013

Particulars	Quarter ended 30th June, 2013
	(Unaudited)
PART II
Particulars of shareholding
Public Shareholding	(Rs. 2.00 per share)
- Number of Shares	95428010
- Percentage of Shareholding	47.79%
Promoters and Promoter Group Shareholding
a) Pledged / Encumbered
- Number of Shares	Nil
- Percentage of shares (as a % of the total shareholding of promoter and promoter group)	--
- Percentage of shares (as a % of the total share capital of the company)	--
b) Non-encumbered
- Number of Shares	104259490
- Percentage of shares (as a % of the total shareholding of promoter and promoter group)	100.00%
- Percentage of shares (as a % of the total share capital of the company)	52.21%

INVESTOR COMPLAINTS	3 months ended June 30, 2013
Pending at the beginning of quarter	5
Received during the quarter	74
Disposed off during the quarter	69
Remaining unresolved at the end of the quarter	10

NOTE:

1. The above results for the first quarter ended June 30, 2013 have been reviewed and recommended by the Audit Committee and approved by the Board of Directors ("Board") in their respective meetings held on Thursday, July 24, 2013.

2. As the Company's business activity falls within a single primary business segment viz 'Two-wheelers, its parts and ancillary services' and is a single geographical segment, the disclosure requirements of Accounting Standard (AS-17) "Segment Reporting", specified in the Companies (Accounting Standard) Rules, 2006 are not applicable.

3. During the quarter, the Scheme of Arrangement (the Scheme) for amalgamation of Hero Investments Private Limited (HIPL) with the Company, approved by the Hon’ble High Court of Delhi which became effective from May 16, 2013, upon filing of the copy of the High Court Order with the Registrar of Companies, NCT of Delhi & Haryana all the assets, debts and liabilities including contingent liabilities have been transferred to and vested with the Company w.e.f. January 1, 2013 (Appointed Date). Consequent thereto, the operations during the period January 1, 2013 to March 31, 2013, which have been run and managed by HIPL in trust for the Company, have been adjusted from the opening reserves and after April 1, 2013 the results of operations have been included in the above results. Further, the Company has filed an application for advance ruling regarding applicability of stamp duty on transfer of shares pursuant to the aforesaid Scheme. Pending disposal of the application, the shares held by HIPL are pending allotment to its individual shareholders. On such allotment Promoters shareholding will be 7,97,12,482 nos. and 39.92% of total holding and correspondingly Public shareholding will be11,99,75,018 nos. and 60.08% of total holding. As per the Scheme, HIPL working in trust for the Company, has declared dividend of Rs 385 per share amounting to Rs. 11.615 millions to erstwhile shareholders of HIPL before the Scheme was made effective.

4. During the quarter, the Company has set up a wholly owned subsidiary HMCL (NA) Inc. and has invested Rs. 914.300 millions as part of capital contribution in the subsidiary. The subsidiary would act towards furtherance of business interest of the Company.

5. In line with Notification No. G.S.R. 378 (E) dated May 11, 2011 issued by The Ministry of Corporate Affairs, Government of India, the exchange differences arising after April 1, 2007 on reporting of long term foreign currency monetary items at rates different from those at which they were initially recorded during the period, or reported in previous financial statements, in so far as they relate to the acquisition of a depreciable capital asset, have been added to or deducted from the cost of the asset and shall be depreciated over the balance useful life of the asset.

6. Previous quarter/year figures have been regrouped/ reclassified wherever necessary, to make them comparable

7. The above results of the Company are available on the Company's website www.heromotocorp.com and also on www.bseindia.com and www.nseindia.com

FIXED ASSETS

Ø Land

Ø Buildings

Ø Plant and machinery

Ø Furniture, fixtures and office equipment

Ø Vehicles

Ø Computer and data processing

Ø Machines

CMT REPORT (Corruption, Money Laundering & Terrorism]

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

1] INFORMATION ON DESIGNATED PARTY

No exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.

2] Court Declaration :

No exist to suggest that subject is or was the subject of any formal or informal allegations, prosecutions or other official proceeding for making any prohibited payments or other improper payments to government officials for engaging in prohibited transactions or with designated parties.

3] Asset Declaration :

No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.

4] Record on Financial Crime :

Charges or conviction registered against subject: None

5] Records on Violation of Anti-Corruption Laws :

Charges or investigation registered against subject: None

6] Records on Int’l Anti-Money Laundering Laws/Standards :

Charges or investigation registered against subject: None

7] Criminal Records

No available information exist that suggest that subject or any of its principals have been formally charged or convicted by a competent governmental authority for any financial crime or under any formal investigation by a competent government authority for any violation of anti-corruption laws or international anti-money laundering laws or standard.

8] Affiliation with Government :

No record exists to suggest that any director or indirect owners, controlling shareholders, director, officer or employee of the company is a government official or a family member or close business associate of a Government official.

9] Compensation Package :

Our market survey revealed that the amount of compensation sought by the subject is fair and reasonable and comparable to compensation paid to others for similar services.

10] Press Report :

No press reports / filings exists on the subject.

CORPORATE GOVERNANCE

MIRA INFORM as part of its Due Diligence do provide comments on Corporate Governance to identify management and governance. These factors often have been predictive and in some cases have created vulnerabilities to credit deterioration.

Our Governance Assessment focuses principally on the interactions between a company’s management, its Board of Directors, Shareholders and other financial stakeholders.

CONTRAVENTION

Subject is not known to have contravened any existing local laws, regulations or policies that prohibit, restrict or otherwise affect the terms and conditions that could be included in the agreement with the subject.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.67.71
UK Pound	1	Rs.105.14
Euro	1	Rs.90.03

INFORMATION DETAILS

Report Prepared by :

ANK

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	8
PAID-UP CAPITAL	1~10	8
OPERATING SCALE	1~10	8
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	9
--PROFITABILIRY	1~10	9
--LIQUIDITY	1~10	9
--LEVERAGE	1~10	9
--RESERVES	1~10	8
--CREDIT LINES	1~10	8
--MARGINS	-5~5	--
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	NO
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
DEFAULTER
--RBI	YES/NO	NO
--EPF	YES/NO	NO
TOTAL		76

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.