MIRA INFORM REPORT

Report Date :

22.12.2014

IDENTIFICATION DETAILS

Name :	BAJAJ AUTO LIMITED (w.e.f. 05.03.2008)
Formerly Known As :	BAJAJ HOLDINGS AND INVESTMENTS LIMITED
Registered Office :	Bajaj Auto Limited Complex, Mumbai – Pune Road, Akurdi, Pune – 411 035, Maharashtra
Country :	India
Financials (as on) :	31.03.2014
Date of Incorporation :	30.04.2007
Com. Reg. No.:	25-130076
Capital Investment / Paid-up Capital :	Rs. 2893.700 Millions
CIN No.: [Company Identification No.]	L65993PN2007PLC130076
IEC No.:	Not Available
TAN No.: [Tax Deduction & Collection Account No.]	PNEB05807E
PAN No.: [Permanent Account No.]	AADCB2923M
Legal Form :	Public Limited Liability Company. The company’s shares are listed on the stock exchanges.
Line of Business :	Manufacturers and Exporter of Two and Three Wheelers.
No. of Employees :	9119 [Approximately]

RATING & COMMENTS

MIRA’s Rating :

Aa (82)

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 384320000
Status :	Excellent
Payment Behaviour :	Regular
Litigation :	Exist
Comments :	Subject is second-largest player in the motorcycle industry in India. It is a well – established and reputed company having excellent track record. The rating reflects bajaj auto’s leading market position in India’s motorcycle and three-wheeler passenger-carrier segments, and its robust financial risk profile, marked by a adequate capital structure and strong liquidity position. Trade relations are reported as fair. Business is active. Payment are reported to be regular and as per commitment. The company can be considered good 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 – September 30, 2014

Country Name	Previous Rating (30.06.2014)	Current Rating (30.09.2014)
India	A1	A1

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

EXTERNAL AGENCY RATING

Rating Agency Name	CRISIL
Rating	Long Term Rating=AAA
Rating Explanation	Highest credit quality and lowest credit risk.
Date	27.12.2013

Rating Agency Name	CRISIL
Rating	Short Term Rating=A1+
Rating Explanation	Very strong degree of safety and lowest credit risk.
Date	27.12.2013

RBI DEFAULTER’ LIST STATUS

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

EPF (Employee Provident Fund) DEFAULTER’ LIST STATUS

Subject’s name is not enlisted as a defaulter in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of 31-03-2014.

INFORMATION DENIED

Management Non Co-Operative (91-22-27472851)

LOCATIONS

Registered/ Head Office/ Factory 1 :	Bajaj Auto Limited Complex, Mumbai-Pune Road, Akurdi, Pune – 411 035, Maharashtra, India
Tel. No.:	91-20-27472851/ 27406603 / 27406063 / 27406281/ 27406137
Fax No.:	91-20-27407380 / 27407392
E-Mail :	vpbhand@bajajauto.co.in investors@bajajauto.co.in jsridhar@bajajauto.co.in
Website :	http://www.bajajauto.com
Factory 2 :	Bajaj Nagar, Waluj, Aurangabad – 431 136, Maharashtra, India
Factory 3 :	MIDC, Plot No. A1, Mahalunge Village, Chakan Industrial Area, Chakan, Pune – 410 501, Maharashtra, India
Factory 4 :	Plot No. 2, Sector -10, IIE Pant Nagar, Udham Singh Nagar – 263 531, Uttarkhand, India

DIRECTORS

As on: 31.03.2014

Name :	Mr. Rahul Bajaj
Designation :	Chairman
Name :	Mr. Madhur Bajaj
Designation :	Vice Chairman
Name :	Mr. Rajiv Bajaj
Designation :	Managing Director
Name :	Mr. Sanjiv Bajaj
Designation :	Executive Director
Name :	Mr. Kantikumar R. Podar
Designation :	Director
Name :	Mr. Shekhar Bajaj
Designation :	Director
Name :	Mr. D.J. Balaji Rao
Designation :	Director
Name :	Mr. D.S. Mehta
Designation :	Director
Name :	Mr. J.N. Godrej
Designation :	Director
Name :	Mr. S.H. Khan
Designation :	Director
Name :	Ms. Suman Kriloskar
Designation :	Director
Name :	Mr. Naresh Chandra
Designation :	Director
Name :	Mr. Nanoo Pamnani
Designation :	Director
Name :	Mr. Manish Kejriwal
Designation :	Director
Name :	Mr. P. Murari
Designation :	Director
Name :	Mr. Niraj Bajaj
Designation :	Director

KEY EXECUTIVES

Name :	Mr. J Sridhar
Designation :	Company Secretary
Management
Name :	Mr. Rahul Bajaj
Designation :	Chairman
Name :	Mr. Madhur Bajaj
Designation :	Vice Chairman
Name :	Mr. Rajiv Bajaj
Designation :	Managing Director
Name :	Mr. Pradeep Shrivastava
Designation :	Chief Operating Officer
Name :	Mr. Abraham Joseph
Designation :	Chief Technology Officer
Name :	Mr. R C Maheshwari
Designation :	President (Commercial Vehicle Business)
Name :	Mr. Rakesh Sharma
Designation :	President (International Business)
Name :	Eric Vas
Designation :	President (New Projects)
Name :	Mr. Kevin P D’sa
Designation :	President (Finance)
Name :	Mr. S Ravikumar
Designation :	Senior Vice President (Business Development and Assurance)
Name :	Mr. Amrut Rath
Designation :	Vice President (Human Resources)
Name :	Mr. C P Tripathi
Designation :	Vice President (CSR)

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

AS ON 31.03.2014

Category of Shareholders	No. of Shares	Percentage of Holding
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Individuals / Hindu Undivided Family	12613090	4.36
Bodies Corporate	132120042	45.67
Sub Total	144733132	50.03
(2) Foreign
Total shareholding of Promoter and Promoter Group (A)	144733132	50.03
(B) Public Shareholding
(1) Institutions
Mutual Funds / UTI	2547367	0.88
Financial Institutions / Banks	715818	0.25
Insurance Companies	19750225	6.83
Foreign Institutional Investors	51184244	17.69
Sub Total	74197654	25.65
(2) Non-Institutions
Bodies Corporate	24620517	8.51
Individuals
Individual shareholders holding nominal share capital up to Rs. 0.100 Million	13738043	4.75
Individual shareholders holding nominal share capital in excess of Rs.0.100 Million	30258337	10.46
Any Others (Specify)	1759293	0.61
Non Resident Indians	902370	0.31
Overseas Corporate Bodies	1425	0.00
Foreign Bodies - D R	8470	0.00
Trusts	770076	0.27
Clearing Members	75319	75319
Foreign Nationals	1633	0.00
Sub Total	70376190	24.33
Total Public shareholding (B)	144573844	49.97
Total (A)+(B)	289306976	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	60044	0.00
Sub Total	60044	0.00
Total (A)+(B)+(C)	289367020	0.00

BUSINESS DETAILS

Line of Business :

Manufacturers and Exporter of Two and Three Wheelers.

Products :

ITC Code	Products Description
8711	Scooters, Auto-rickshaw, Motorcycles and Mopeds

Brand Names :

Not Divulged

Agencies Held :

Not Divulged

Exports :

Products :

Not Divulged

Countries :

Not Divulged

Imports :

Products :

Not Divulged

Countries :

Not Divulged

Terms :

Selling :

Not Divulged

Purchasing :

Not Divulged

GENERAL INFORMATION

Suppliers :

Reference :	Not Divulged
Name of the Person :	Not Divulged
Contact No.:	Not Divulged
Since How Long Known :	Not Divulged
Experience :	Not Divulged
Maximum Limit Dealt :	Not Divulged

Customers :

Wholesalers, Retailers, End Users, OEM’s and Others

Reference :	Not Divulged
Name of the Person :	Not Divulged
Contact No.:	Not Divulged
Since How Long Known :	Not Divulged
Experience :	Not Divulged
Maximum Limit Dealt :	Not Divulged

No. of Employees :

9119 [Approximately]

Bankers :

· Central Bank of India

· State Bank of India

· Citibank N.A.

· Standard Chartered Bank

· Bank of America

· ICICI Ban

· HDFC Bank

Facilities :

Not Divulged

Auditors :
Name :	Dalal and Shah Chartered Accountants
Cost Auditors :	A.P. Raman Cost Accountants
Holding company, subsidiaries and fellow subsidiary :	· PT. Bajaj Auto Indonesia (98.94% shares held by Bajaj Auto Limited) · Bajaj Auto International Holdings B V (Fully owned subsidiary)
Associates, joint ventures and investing parties :	· Bajaj Holdings and Investment Limited (Investing party - holds 31.49% shares of Bajaj Auto Limited)
Enterprises over which anyone exercises significant influence :	· Bajaj Finserv Limited · Bajaj Finance Limited · Bajaj Allianz General Insurance Company Limited. · Bajaj Allianz Life Insurance Company Limited · Bajaj Finance Solutions Limited · Bajaj Electricals Limited · Hind Musafir Agency Limited · Hindustan Housing Company Limited · KTM Sportsmotorcycle AG · KTM Sportsmotorcycle India Private Limited

CAPITAL STRUCTURE

As on: 31.03.2014

Authorised Capital :

No. of Shares	Type	Value	Amount
300000000	Equity Shares	Rs. 10/- each	Rs.3000.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
289367020	Equity Shares	Rs. 10/- each	Rs.2893.670 Millions

a) Further, of the above:-

I. 144,683,510 equity shares were allotted as fully paid bonus shares by capitalisation of General reserve by the Company on 13 September 2010.

II. 101,183,510 equity shares were allotted as fully paid up pursuant to the scheme of arrangement for demerger of erstwhile Bajaj Auto Limited (now Bajaj Holdings and Investment Limited.) by the Company on 3 April 2008.

III. 1,805,071 equity shares thereof (excluding 1,805,071 equity shares allotted as bonus shares thereon) are deemed to be issued by way of Euro Equity Issue represented by Global Depository Receipts (GDR) evidencing Global Depository Shares outstanding on the record date. Outstanding GDRs at the close of the year were 60,044 (66,196)

b) Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of H 10 per share. Each holder of equity shares is entitled to one vote per share. The dividend proposed by the Board of Directors and approved by the shareholders in the annual general meeting is paid in Indian rupees. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders

c) Details of shareholders holding more than 5% shares in the Company

	31.03.2014
Name of Shareholder	Number of Shares	% holding
Bajaj Holdings and Investment Limited	91119000	31.49%
Jamnalal Sons Private Limited	25844400	8.93%

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS	31.03.2014	31.03.2013	31.03.2012
I. EQUITY AND LIABILITIES
(1)Shareholders' Funds
(a) Share Capital	2893.700	2893.700	2893.700
(b) Reserves & Surplus	93186.500	76125.800	57517.000
(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)	96080.200	79019.500	60410.700
(3) Non-Current Liabilities
(a) long-term borrowings	577.400	712.700	974.800
(b) Deferred tax liabilities (Net)	1431.800	1151.000	484.400
(c) Other long term liabilities	874.300	1220.600	1570.700
(d) long-term provisions	1209.900	1346.100	1118.500
Total Non-current Liabilities (3)	4093.400	4430.400	4148.400
(4) Current Liabilities
(a) Short term borrowings	0.000	0.000	0.000
(b) Trade payables	21114.000	19796.100	19577.900
(c) Other current liabilities	7661.400	5461.600	6043.300
(d) Short-term provisions	18527.000	16078.600	20660.500
Total Current Liabilities (4)	47302.400	41336.300	46281.700
TOTAL	147476.000	124786.200	110840.800
II. ASSETS
(1) Non-current assets
(a) Fixed Assets
(i) Tangible assets	20060.400	18044.300	14795.900
(ii) Intangible Assets	0.000	0.000	21.400
(iii) Capital work-in-progress	325.500	2232.900	117.700
(iv) Intangible assets under development	1115.100	702.600	298.800
(b) Non-current Investments	62599.300	37191.500	37862.100
(c) Deferred tax assets (net)	0.000	0.000	0.000
(d) Long-term Loan and Advances	7199.200	4623.900	6008.700
(e) Other Non-current assets	10.200	10.200	14.300
Total Non-Current Assets	91309.700	62805.400	59118.900
(2) Current assets
(a) Current investments	22897.000	27113.300	10966.000
(b) Inventories	6397.200	6362.800	6785.300
(c) Trade receivables	7962.100	7675.800	4227.900
(d) Cash and cash equivalents	4954.800	5588.500	16538.300
(e) Short-term loans and advances	9784.500	13117.200	10248.500
(f) Other current assets	4170.700	2123.200	2955.900
Total Current Assets	56166.300	61980.800	51721.900
TOTAL	147476.000	124786.200	110840.800

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2014	31.03.2013	31.03.2012
	SALES
		Income	201495.100	199972.500	195289.800
		Other Income	7064.100	7954.900	6080.400
		TOTAL (A)	208559.200	207927.400	201370.200
Less	EXPENSES
		Cost of raw material and components consumed	129364.700	135237.400	134455.400
		Purchases of traded goods	9591.000	8588.300	7511.500
		(Increase)/decrease in inventories of finished goods, work-in-progress and traded goods	(189.000)	240.000	(941.500)
		Employee benefits expense	7265.800	6394.800	5401.100
		Other expenses	15054.200	13788.000	12157.700
		Expenses, included in above items, capitalized	(649.000)	(628.500)	(494.300)
		Exceptional items	0.000	0.000	1340.000
		TOTAL (B)	160437.700	163620.000	159429.900
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		48121.500	44307.400	41940.300
Less	FINANCIAL EXPENSES (D)		4.900	5.400	222.400
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		48116.600	44302.000	41717.900
Less	DEPRECIATION/ AMORTISATION (F)		1796.100	1639.700	1456.200
	PROFIT BEFORE TAX (E-F) (G)		46320.500	42662.300	40261.700
Less	TAX (H)		13887.300	12226.600	10221.200
	PROFIT AFTER TAX (G-H) (I)		32433.200	30435.700	30040.500
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		49202.600	37051.400	25154.800
Less	APPROPRIATIONS
		Transfer to General Reserve	3250.000	3050.000	3010.000
		Proposed Dividend	14468.400	15234.500	15133.900
	BALANCE CARRIED TO THE B/S		93186.500	49202.600	307051.400
	EARNINGS IN FOREIGN CURRENCY
		F.O.B. Value of exports	79314.600	65082.700	64491.800
		Exchange gain/(Loss) on Derivative hedging instruments, debtors	115.300	399.100	1547.900
		Forwarding charges exports recovered	95.700	86.700	129.800
		Interest	5.100	26.600	19.500
		Royalty	26.100	26.600	8.000
		Technical Know how	5.200	8.300	3.000
		Asset Disposal	0.000	0.000	0.700
		Other Earnings	76.600	23.400	58.900
	TOTAL EARNINGS		79638.600	65653.400	66259.600
	IMPORTS
		Raw Materials	372.400	381.700	1157.000
		Components	5021.600	5478.500	5216.800
		Vehicles and spare parts	154.900	117.800	96.000
		Machinery spares	94.000	68.900	92.000
		Capital goods	519.300	3783.700	217.000
		Tools, stores, etc.	89.000	64.600	68.300
	TOTAL IMPORTS		6251.200	9895.200	6847.100
	Earnings Per Share (Rs.)		112.1	105.20	103.80

KEY RATIOS

PARTICULARS		31.03.2014	31.03.2013	31.03.2012
PAT / Total Income	(%)	15.55	14.64	14.92
Net Profit Margin (PBT/Sales)	(%)	22.99	21.33	20.62
Return on Total Assets (PBT/Total Assets}	(%)	54.42	50.39	55.49
Return on Investment (ROI) (PBT/Networth)		0.48	0.54	0.67
Debt Equity Ratio (Total Debt /Networth)		0.01	0.01	0.02
Current Ratio (Current Asset/Current Liability)		1.19	1.50	1.12

FINANCIAL ANALYSIS

[all figures are in Rupees Millions]

DEBT EQUITY RATIO

Particular	31.03.2012	31.03.2013	31.03.2014
	(Rs. In Millions)	(Rs. In Millions)	(Rs. In Millions)
Share Capital	2893.700	2893.700	2893.700
Reserves & Surplus	57517.000	76125.800	93186.500
Net worth	60410.700	79019.500	96080.200
long-term borrowings	974.800	712.700	577.400
Short term borrowings	0.000	0.000	0.000
Total borrowings	974.800	712.700	577.400
Debt/Equity ratio	0.016	0.009	0.006

YEAR-ON-YEAR GROWTH

Year on Year Growth	31.03.2012	31.03.2013	31.03.2014
	(Rs. In Millions)	(Rs. In Millions)	(Rs. In Millions)
Sales	195289.800	199972.500	201495.100
		2.398	0.761

NET PROFIT MARGIN

Net Profit Margin	31.03.2012	31.03.2013	31.03.2014
	(Rs. In Millions)	(Rs. In Millions)	(Rs. In Millions)
Sales	195289.800	199972.500	201495.100
Profit	30040.500	30435.700	32433.200
	15.38%	15.22%	16.10%

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	Yes
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	Yes
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

LITIGATION DETAILS
Bench:- Bombay
Presentation Date:- 13/06/2013
Stamp No:-	WPST/16056/2013	Failing Date:-	13.06.2013	Reg. No.:-	WP/5375/2013	Reg. Date:-	24.06.2013
Lodging No:-	Main Matter
Petitioner:-	VISHWAKALYAN KAMGAR SANGHATANA		Respondent:-	BAJAJ AUTO LIMITED AND ANR-
Petn.Adv:-	MIHIR DESAI (838)		Resp. Adv:-	M. S. BODHANWALLA AND CO. (0)
District:-	PUNE
Bench:-	SINGLE
Status:-	Admitted (Unready)
Date:-	23/07/2013		Stage:-	PETITIONS FOR ADMISSION – FRESH [CIVIL SIDE MATTERS]
Coram:-	HON’BLE SHRI JUSTICE K.K.TATED
Act:-	Trade Unions Act, 1926

UNSECURED LOAN:

Particulars	As on 31.03.2014 Rs. in Millions	As on 31.03.2013 Rs. in Millions
Unsecured Loans
Sales tax deferral liability/loan, an incentive under Package Scheme of Incentives 1983, 1988 and 1993 - interest free, partially prepaid	577.400	712.700
Total	577.400	712.700

MANAGEMENT DISCUSSION AND ANALYSIS:

Research and Development and technology absorption

PRODUCTS:

Pulsar 200 NS

After the successful launch of Pulsar 200 NS in May 2012, this model has been well received in markets like Colombia. During the year under review, it was launched in Indonesia under the joint brand of Kawasaki Bajaj. The bike has been well received. New colour and graphics have been introduced on the 200 NS to make it even more exciting.

Discover 125 M

The Discover 125 M is the quintessential 125. Built on the compact M platform, it is a great blend of performance and affordability. This engine develops class leading performance of 11.5 Ps power and 1.12 Kg-m of torque, for a powerful drive, while maintaining the high fuel efficiency for which Discover brand is known for. The vehicle has a four-speed gear box suitably mated to the power characteristics of the engine. The agile handling chassis and

suspension make this an ideal city bike.

Discover 100 M

The Discover 100 M is the new entry level Discover. It exemplifies the core values of high performance blended with great fuel economy. This product has been designed to complement the styling aspects of the ST and T series, which have created good appeal for the customers. The vehicle is powered by a high performance four-valve air cooled 100 cc DTSi engine, delivering 9.5 Ps and Torque of 0.92 Kg-m, with a four-speed gear box suitably mated to the power characteristics of the engine. It has the best in class fuel efficiency. The careful engineering of the product has resulted in very attractive price to the customer.

KTM Duke 390 with ABS

This joint venture between KTM and Bajaj saw yet another successful launch in the form of Duke 390. With the trademark Orange frame and alloy wheels typical to KTM, the bike lives upto the 'Ready to Race' tag of KTM brand exceptionally well.

RE

All variants of the RE range of three-wheeler products comprising small, medium and large platforms and covering gasoline, gaseous and diesel engines have been put through a complete upgrade. These products have been updated with much better driver comfort through revised ergonomics, smart looks, improved engine performance and revised gear ratios leading to excellent drivability and upto 15% improvement in fuel economy. DTSi technology has also been employed in the spark ignited engine versions, while five-speed gear box has been deployed in the diesel engine versions.

PROCESS:

R&D has been working on improving its operations in a number of areas as listed below.

· Manpower: R&D has been expanding its team size in areas of design, analysis and validation in order to keep up with the rapidly expanding aspirations of the Company. In the year under review, we have expanded our manpower by about 6%.

· Facilities: R&D continued to enhance its design, computing, prototype manufacturing and validation facilities. Such enhancement efforts have enabled R&D to develop durable and

· refined products. A number of new test facilities were put in to validate the durability and performance of the forthcoming two and four wheelers. The prototyping facilities were also augmented to enable building of the prototypes of these vehicles.

Technology:

1. Anti Lock Braking system was introduced on KTM Duke 390. Through this model, the domestic and export markets got the chance to experience the confidence and safety of ABS, while applying the brakes on this high performance bike. Customers and media alike were impressed by this feature and its performance.

2. Technologies like Fuel Injection, five speed gear box, Multi valves, DTSi and light weighting have been employed on the RE60 to achieve excellent fuel economy, while at the same time provide great drivability and comfort to the driver and passengers. The product meets among other things the 400 kg weight limit prescribed in the European regulations for such category.

Outgo:

The expenditure on research and development during 2013-14 and in the previous year was

:

Particulars	FY2014	FY2013
Capital (including technical know-how)	871.100	1091.900
Recurring	1896.800	1294.000
Total	2767.900	2385.900
Total research and development expenditure as a percentage of sales, net of excise duty	1.40%	1.22%

INDUSTRIAL RELATIONS:

Industrial relations with staff and workmen at the plants at Akurdi, Waluj and Pantnagar continued to be cordial. This includes the relations with staff at the plant at Chakan.

At Chakan, the workmen represented by the recognized union Vishwa Kalyan Kamgar Sanghatana, went on strike from 25 June 2013 to 13 August 2013 for the reason that Management refused to accede to their demand of allotment of 500 shares to each workman at a discounted rate of H 1 per share. The union withdrew the strike unconditionally on realising Management’s firm decision and workers resumed work with effect from 14 August 2013.

At Chakan, wage review was due effective from 1 April 2013. Management offered H 10,000 per month in a phased manner, depending upon the year of service etc., for three years. However, this issue is under litigation.

At Akurdi, as per the provisions of the wage settlement dated 20 August 2010, wage review was due and accordingly Memorandum of Understanding (MOU) was signed on 10 February 2014 giving wage rise of H 10,000 per month per workman in a phased manner.

At Waluj, Bajaj Auto Ltd. Employees’ Union, representing majority of the workmen, has submitted a Charter of Demands for the forthcoming wage settlement, which is due from 1 August 2014.

CONTINGENT LIABILITY:

(Rs. In Millions)

Particulars	31.03.2014	31.03.2013
Claims against the Company not acknowledged as debts	4464.100	4188.800
Guarantees given by the Company to banks, on behalf of its subsidiary, PT Bajaj Auto Indonesia	0.000	271.400
Guarantees given by the Company to Housing Development Finance Corporation Limited - for loans to Employees	0.200	0.400
Excise and Customs demand - matters under dispute and Claims for refund of Excise Duty, if any, against Excise Duty Refund received in the earlier year	3920.800	2933.100
Income tax matters - Appeal by company	985.600	541.300
Value Added Tax (VAT)/Sales Tax matters under dispute	1161.100	3774.800
Claims made by temporary workmen Pending before various judicial/appellate authorities in respect of similar matters adjudicated by the Supreme Court. The matter is contingent on the facts and evidence presented before the courts/adjudicating authorities and not necessarily likely to be influenced by the Supreme Court’s order	Liability unascertained	Liability unascertained
Total	10563.0314	11741.0313

STATEMENT OF STANDALONE UNAUDITED FINANCIAL RESULTS FOR THE QUARTER AND HALF YEAR ENDED 30 SEPTEMBER 2014

Sr. No	Particulars		Standalone
			Quarter Ended		Half year ended Ended
			30.09.2014	30.06.2014	30.09.2014
			Unaudited	Unaudited	Unaudited
1	Income From Operations
	a) Gross sales		60543.200	53347.100	113890.300
	Less : Excise Duty		2274.700	2013.400	4288.100
	a. Net Sales/ Income from Operations (Net of Excise Duty)		58268.500	51333.700	109602.000
	b. Other Operating Income		1362.400	1190.400	2552.800
	Total Income from Operations (Net)		59630.900	52524.100	112155.000
2	Expenditure
	a. Cost of material Consumed		38379.000	33631.100	72010.100
	b. Purchase of Stock-in trade		2903.300	2448.200	5351.500
	c. Changes in inventory of finished Goods, work- in-progress and Stock-in-trade		(181.800)	722.900	54.110
	d. Employees Benefit Expenses		2102.400	2145.700	4248.100
	e. Depreciation and Amortisation Expenses		686.200	692.000	1378.200
	f. Other expenses		5319.900	4451.100	9771.000
	g.Expenses capitalized		(159.700)	(126.200)	(285.900)
	Total Expenses		49049.300	43964.800	93014.100
3	Profit from Operations before Other Income, Interest and Exceptional Items		10581.600	8559.300	19140.900
4	Other Income		1136.100	2192.700	3328.800
5	Profit from ordinary activities before finance cost & exceptional items		11717.700	10752.000	22469.700
6	Finance Costs		0.5	01.100	01.600
7	Profit from ordinary activities after finance costs & exceptional items		11717.200	10750.900	22468.100
8	Exceptional items		3402.900	0.000	3402.900
9	Profit from ordinary activities before tax		8314.300	10750.900	19065.200
10	Tax Expense		2405.300	3351.100	5756.400
11	Net Profit from ordinary activity after tax		5909.000	7399.800	13308.800
12	Extraordinary Items		0.000	0.000	0.000
13	Net Profit After Tax		5909.000	7399.800	13308.800
14	Paid-up equity share capital (face value of Rs.10 per share)		2893.700	2893.700	2893.700
15	Reserves excluding Revaluation Reserve as per balance sheet of previous accounting Year
16	Basic and Diluted Earnings per share (Rs.) (not annualized)
	before and after extraordinary itemps		20.4	25.6	46.0
A		PARTICULARS OF SHAREHOLDING
17		Public Shareholding
		- No. of shares	144633888	144633888	144633888
		- Percentage of shareholding	49.98%	49.98%	49.98%
18		Promoter & Promoter Group Shareholding
		a) Pledged/Encumbered
		- No. of shares	79.855	79.855	79.855
		- Percentage of shareholding (as a % of the total shareholding of promoter and promoter group)	0.06%	0.06%	0.06%
		- Percentage of shareholding (as a % of the total share capital of the company)	0.03%	0.03%	0.03%
		b) Non-encumbered
		- No. of shares	144653277	144653277	144653277
		- Percentage of shareholding (as a % of the total shareholding of promoter and promoter group)	99.94%	99.94%	99.94%
		- Percentage of shareholding (as a % of the total share capital of the company)	49.99%	49.99%	49.99%

	Particular	Quarter Ended
B	Investor Complaints	30.09.2014
	Pending at the beginning of the quarter	Nil
	Received during the quarter	5
	Disposed of during the quarter	5
	Remaining unresolved at the end of the quarter	Nil

UNAUDITED SEGMENT WIE REVENUE, RESULTS AND CAPITAL EMPLOYED

(Rs. In Millions)

Particulars	Quarter Ended		Half year ended Ended
	30.06.2014	30.09.2014	30.06.2014
1. Segment Revenue
Automotive	59932.600	52985.400	112918.000
Investments	834.400	1731.400	2565.800
Unallocable	0.000	0.000	0.000
Total	60767.000	54716.800	115483.800
2. Segment Profit/ (Loss) before tax and finance costs
Automotive	7483.200	9023.200	16506.400
Investments	831.600	1728.800	2560.400
Unallocable	0.000	0.000	0.000
Total	8314.800	10752.000	19066.800
Less : Finance Costs	0.500	1.100	1.600
Total profit before tax	8314.300	10750.900	19065.200
3. Capital Employed
Automotive	15927.600	18158.300	15927.600
Investments	94839.500	104434.400	94839.500
Unallocable	1038.100	(16623.000)	1038.100
Total	111805.200	105969.700	111805.200

1. Disclosure of assets and liabilities as per clause 41 (I) (ea) of the listing agreement for the half year ended 30 September 2014

SOURCES OF FUNDS	30.09.2014
I. EQUITY AND LIABILITIES
(1)Shareholders' Funds
(a) Share Capital	2893.700
(b) Reserves & Surplus	106874.900
Total Shareholders’ Funds (1) + (2)	109768.600
(3) Non-Current Liabilities
(a) long-term borrowings	928.400
(b) Deferred tax liabilities (Net)	1108.200
(c) Other long term liabilities	722.900
(d) long-term provisions	1434.900
Total Non-current Liabilities (3)	4194.400
(4) Current Liabilities
(a) Short term borrowings	161.000
(b) Trade payables	24154.600
(c) Other current liabilities	11295.900
(d) Short-term provisions	2472.400
Total Current Liabilities (4)	38083.900
TOTAL	152046.900
II. ASSETS
(1) Non-current assets
(a) Fixed Assets	20743.800
(b) Non-current Investments	23133.900
(d) Long-term Loan and Advances	8038.200
(e) Other Non-current assets	10.400
Total Non-Current Assets	51926.300
(2) Current assets
(a) Current investments	71048.800
(b) Inventories	6016.700
(c) Trade receivables	9721.700
(d) Cash and cash equivalents	1954.900
(e) Short-term loans and advances	8771.600
(f) Other current assets	2606.900
Total Current Assets	100120.600
TOTAL	152046.900

1. Consequent to the enactment of the Companies Act, 2013 (the Act) and its applicability for accounting periods commencing after 1 April 2014, the company has re – worked depreciation with reference to the estimated economic lives of fixed assets prescribed by Schedule II to the Act or actual useful life of assets, whichever is lower. In case of any assets whose life has completed as above, the carrying value, net of residual value, as at 1april 2014 has been adjusted to the General Reserve and in other cases the carrying value has been depreciated over the remaining of the revised life of the assets and recognized in the Statement of Profit and Loss.

2. The marked-to- market gain/loss representing time value of foreign exchange to hedge future exports, which reverse out over the period of contract, net of such reversals are recognized either as ‘ Other Income” or ‘ Other expenses’ as the case may be. The above results include these impact as follows.

Sr. No	Particulars	Standalone
		Quarter Ended		Half year ended Ended
		30.09.2014	30.06.2014	30.09.2014
		Unaudited	Unaudited	Unaudited
1	Net gain as Other Income	0.000	0.000	0.000
	Net loss as Other expenses	674.100	672.300	1346.400

3. Other income includes following –

Sr. No	Particulars	Standalone
		Quarter Ended		Half year ended Ended
		30.09.2014	30.06.2014	30.09.2014
		Unaudited	Unaudited	Unaudited
1	Investment Income	834.400	1731.400	2565.800
	Others	301.700	461.300	763.000

4. Other expenses include contributions of Rs. 216.800 Million made by the Company towards Corporate Social Responsibility (CSR).

5. The honorable high court of Uttarakhand has passed an order dated 9 October 2014 ruling that the levy of “National Calamity Contingent Duty” (NCCD) is out of the purview of the exemptions granted to the company under the scheme of incentives for industries in certain identified growth areas in Uttrakhand.

Consequently the Company is now liable to pay the disputed duty for the period from 1 April 2007

to 30 September 2014, together with interest and penalty aggregating Rs. 3402.900 Million crore,

which has been provided for in the above results and disclosed as an exceptional item of

expenditure.

6. Figures for previous year/ period have been regrouped wherever necessary.

7. Rs. 1 crore is equal to Rs.10.000 Million

8. The above results have been reviewed by the Audit Committee, approved by the Board of Directors in the meeting held on 14 October 2014 and subjected to a limited review by the statutory auditors.

INDEX OF CHARGES

S.No.	Charge ID	Date of Charge Creation/Modification	Charge amount secured	Charge Holder	Address	Service Request Number (SRN)
1	10122149	26/07/2008	4,300,000,000.00	Central Bank of India	Corporate Finance Branch, 1st Floor, MMO Building,  Fort, Mumbai, Maharashtra - 400023, INDIA	A45544905

* Date of charge modification

FIXED ASSETS

· Land Leasehold

· Land Freehold

· Buildings

· Water pump

· Reservoirs and Mains

· Plant and Machinery

· Dies and Jigs

· Electric Installations

· Factory Equipments

· Furniture Fixtures

· Electric Fittings

· Vehicles and Aircraft

· Office Equipments

PRESS REALISE

INDIA TO BE KTM PRODUCTION HUB

KOLKATA: India is on the cusp of emerging as the lead production hub of Austrian motorcycle brand KTM with the four motorcycles manufactured at the Chakan plant poised to outsell super-sports and off-road bikes rolling out of the Mattighofen facility in Austria.

"For KTM, this will be a record year with sales projected to touch an all-time high of 150,000. Of this, 80,000-85,000 bikes will be made in India and sold in the domestic market as well as exported to Europe, US, Latin America and all of Asia, including Japan," KTM India head and Bajaj Auto senior vice-president Amit Nandi told TOI. Bajaj Auto has 48% stake in KTM.

The biggest export markets for the made-in-India KTM bikes are Western and southern Europe comprising Germany, France, Spain and Italy. With EU countries consicous about fuel conservation and its positive impact on the environment, these relatively frugal bikes are becoming extremely popular. 

The four bikes manufactured in Chakan — Duke 200 and Duke 390 in the naked bike category and RC 200 and RC 390 in super-sports bikes — are co-developed by KTM and Bajaj for the global market. "Prior to these bikes, KTM made street motorcycles upwards of 690 cc and 50-500 cc off-roaders," Nandi pointed out. 

While Bajaj Auto sold 11,000 KTM bikes in India last fiscal, it may sell twice as many bikes this year, having already clocked sales of 10,000 bikes till August. "We have registered 120% growth in the first five months of this fiscal," the official said.

"What has led to the phenomaenal growth is that we have broadened our portfolio to introduce bikes that are relevant to the market and priced just perfect and also improved the network to 150 showrooms. Now that we four products, we are also marketing them aggressively through events like Orange Days and Track Days where we are hiring a venue where riders can turn on the throttle and enjoy the thrill of riding a KTM," said Nandi. 

The market for bikes priced above Rs 0.080 Million is around 500,000 units per annum in India. Of this, Bajaj Pulsar corners nearly 60% sales, leaving others to fight over the remaining pie. Nandi though expects the segment to grow at twice the pace of the remaining two – wheeler industry.

That should propel it past the 100,000 milestone in four- five years.

BAJAJ AUTO SALES DOWN 3% IN OCTOBER

NEW DELHI : Bajaj Auto on Monday reported 3.27 per cent decline in motorcycle sales at 3,36,923 units in October 2014.

The company had sold 3,48,323 units in the corresponding month of previous year, Bajaj Auto Ltd (BAL) said in a statement.

BAL said exports were up 14.87 % during the month at 1,58,547 units as compared to 1,38,022 units in October 2013.

In the commercial vehicles category, its sales stood at 49,094 units, up 32.68 per cent, against 37,000 units in the same month of the previous year.

The total vehicle sales of the company during last month stood at 3,86,017 units, marginally up by 0.18 per cent, against 3,85,323 units in the same month a year-ago, the statement added.

BAJAJ AUTO MOTORCYCLE SALES DOWN 6% IN NOVEMBER

Bajaj Auto today reported six percent decline in motorcycle sales at 2,61,94 units in November 2014.

The company had sold 2,78,703 units in the corresponding month of previous year, Bajaj Auto Ltd (BAL) said in a statement.

BAL said exports were up 23.93 per cent during the month at 1,65,733 units as compared to 1,33,731 units in November 2013.

In the commercial vehicles category, its sales stood at 47,311 units, up 48.36 per cent, against 31,888 units in the same month of the previous year.

The total vehicle sales of the company during last month stood at 3,09,259 units, marginally down by 0.42 per cent, against 3,10,591 units in the same month a year ago, the statement added.

BAJAJ MULLS PRICE HIKE FOR DISCOVER, PLATINA MODELS FROM JAN

New Delhi: Bajaj Auto is looking to raise prices of its two models - Platina and Discover - from next month in order to partially offset increase in input costs.

The Pune-based company had earlier raised prices of its Pulsar model range by Rs 1,000 at the end of festival season this year.

"We plan to hike prices of Discover and Platina models in January. We have not hiked the prices of these models so far," Bajaj Auto Ltd President (Motorcycle) Eric Vas told PTI. The company has, however, not yet decided on the quantum of the price hike, he added.

"We haven’t decided on the quantum of the hike so far but it will definitely depend on two things. One, we will have to look at the sales performance and secondly also have to consider excise duty structure going ahead," Vas said.

When asked about the reasons for the proposed hike in prices of the two models, Vas said: "Our vendors have taken a hit because of the minimum wages of workers that have gone up considerably and secondly power cost has also gone up considerably, affecting all of us."

He added that even the company's rivals in the domestic market have gone for price hikes across their product portfolios this year.

The company, which saw its motorcycle sales decline by 6 percent at 2, 61,948 units in November 2014, expects the industry to stay subdued in December as well.

"December is not going to be different from November in terms of sales. We expect December sales to witness a decline as compared to same period of last year," Vas said. Besides, Platina and Discover, the company also sells models like Pulsar, Avenger and Ninja.

4 NEW LAUNCHES TO BOOST MKT SHARE TO 22%: BAJAJ AUTO

After having reported a six percent decline in motorcycle sales at 2,61,94 units in November 2014, Rajiv Bajaj, managing director,  Bajaj Auto  says the company is poised to reach a market share of 20-22 percent on the back of four new launches the company has lined-up between January to April 2015.

Speaking to CNBC-TV18, Bajaj says the company’s inventory level currently stands at 4-5 weeks and it will meet its 4 lakh unit sales target by the fiscal-end.

On the sales- front Bajaj says the industry’s retail sales are down 20 percent year-on-year as are the company’s. he says the industry has overbilled significantly in November while the company under billed slightly as December is the company’s weakest month of the year.

The total vehicle sales of the company during last month stood at 3,09,259 units, marginally down by 0.42 percent, against 3,10,591 units in the same month a year ago, the statement added.

Below is the verbatim transcript of Rajiv Bajaj’s interview with CNBC-TV18's Menaka Doshi, Sonia Shenoy and Senthil Chengalvarayan.

Menaka: What would you diagnose as the reason for why your domestic sales have been poor, your market share has been slipping?

A: We have to look at the numbers a little carefully to understand what they are saying. Let me start with the industry and then I will come to Bajaj. If you go back two or three years there is an year when you had both Dussehra and Diwali in the same month of October and when you go on to the next month in November sales fall by about 40 percent at the retail level when you go from a big October into the subsequent November.

This year also we had Dussehra and Diwali in the month of October and the industry retail for the month of October was about Rs. 1.380 Million motorcycle. If we were to apply the same factor of about 40 percent this retail should have been close to Rs. 0.800 Million units in November, however, actual retail is about 7 lakh. So that is the first situation that at the retail level in November motorcycle sales are only about 7 lakh units. Of that Bajaj Auto’s retail is about 130,000 which forms the sale of 18.5 percent market share that we recorded at the retail level in the month of October. So, that is the first point I would like to make that there is an industry situation and this performance of Bajaj Auto is no different.

The second issue is which is relying more on the recent data which is a month to month change. If you were to look at industry billing now for the month of October it was at about 890,000 units or so whereas in this month it is about 850,000 units.

November last year with November this year. November last year had Diwali, November this year did not have a Diwali because that was over on 23rd October. It sounds absurd to me that an industry that does about 890,000 motorcycles in November last year does as much as 850,000 in November this year. it makes no sense in the absence of Diwali. The industry cannot be down only three percent November to November.

Menaka: What is this then, inventory building is it?

The industry is actually down 20 percent November to November. Menaka: What is this then, inventory building is it? A: This is huge inventory build up. In other words now, let’s talk about the short story. The story is while industry has built 852,000 motorcycles to be precise in November 2014 the actual retail is only 700,000 which means the industry has built up a stock of 152,000 motorcycles.

Now in our case the retail has actually been a shade better than billing. That is why at a retail level although we hold our 18.6-18.7 percent market share at a billing level it will look closer to 15 percent and that is what perhaps makes you say that Bajaj’s sales are slumpy and Bajaj is doing worse than the industry.

Menaka: What you are saying is that everybody else is in fact misrepresenting their sales numbers?

A: There is no misrepresentation at all. Billing is a very real number of primary sales from the manufacturer to the dealers. If you were to look at for example Bajaj’s\\' market share on a billing basis in the month of October it was 20.5 percent but at a retail level it was still 18.5 percent. This is bound to happen that if we try to track two things too closely from month to month you will find this kind of variation because your market share depends not just on yourself but what your competition is also billing or not billing.

Menaka: If I have understood you correctly, in a sense you are saying that your retail sales are higher than your billing. So, why is that for other manufacturer’s dealers are keen on inventory stocking a little bit more than they are keen on inventory stocking your brand?

A: I don’t know what the psyche of competitor dealers is but as a company we would not like stock up dealers at the end of November knowing well that December is the weakest month of the year and we don’t want dealers lumped with stocks of products made this year which have to be sold next year. What the compulsions are for the competition to stock up dealerships and whether they are planning to liquidate that in December through a promotion or a scheme that would be all very speculative on my part to comment on.

BAJAJ AUTO SELLS 309259 UNITS IN NOVEMBER 2014

Bajaj Auto Ltd has submitted to BSE a copy of the press release being issued by the Company in respect of sales for the month of November 2014.

EXPECT 2% NEGATIVE IMPACT ON BAJAJ AUTO'S FY16 EPS: QUANT

Raghunandhan NL, auto analyst, Quant Broking says Bajaj Auto  ’s FY16 earning per share (EPS) forecast is likely to be cut by 2 percent on the back of Nigeria devaluing its currency–Naira.

Nearly 35 percent of Bajaj Auto's export revenues come from Nigeria. This development is an incremental negative as 12 percent of the company’s total revenue and 14 percent of the EBITDA comes from the Nigerian market.

Below is the transcript of Raghunandhan NL's interview with Ekta Batra & Anuj Singhal on CNBC-TV18.

Anuj: Your take on this news. Do you think Bajaj investor should get worried?

A: The impact is on two counts one is on the demand side. With the price hikes happening in the Nigerian market to the tune of 4-5 percent and interest rate going up from 12-13 percent there could be an impact on the demand side. Secondly, on the realisations for the company so the company might have to pass on some amount of the price hike which has to be absorbed by the company to an extent.

So, on the overall realisations and margins there might be a slight impact but the combination of both these things on the demand side and on the realisations and margin side the combination of both these things would not be significantly material on our FY16 estimates.

So, our estimates say that even if I take a 5,000 monthly reduction in volume and if I take a hit on realisation to the extent of 0.2 percent the overall impact on FY16 earnings per share (EPS) would be above 2 percent. So, as of now I don’t see a major impact on the EPS.

Ekta: There was a report which I was reading which was pertinent and talking about the depreciation in the Nigerian as well as the Columbian currency which has resulted in the FY16 estimated EPS been cut by 3 percent according to them and their earnings before interest, taxes, depreciation, and amortization (EBITDA) assumption by 150 basis points. So, you don’t stand by that, you don’t see any sort of material impact on the EBITDA as well as the EPS for FY16. If so where would it stand your assumptions?

A: The impact of this Nigeria thing would be marginal. I would not take a significant cut on the margins but on the positive side the rupee depreciation against the US dollar that is positively helping the company and we expect them to sustain above 20 percent EBITDA margin for FY16.

Anuj: What is your call on the stock now and what is your price target? What would be your pecking order in the two-wheeler pack?

A: Based on our last report we had a target of Rs 2,601 on Bajaj Auto and we had an accumulate rating on the stock. Currently the price is hovering around that price itself. In reference to our pecking order in two-wheeler pack we like Hero Motocorp and within the Auto manufacturers part we like Maruti Suzuki, Tata Motors, Eicher Motors that would be our top picks and with reference to smaller names among the manufacturers we like SML Isuzu.

Ekta: What are your volume assumptions for FY16 in the export as well as the domestic market totally and what sort of valuations is Bajaj Auto trading at according to you currently and would it be fairly valued as opposed to the others?

A: In FY14 they did a monthly runrate of 3,20,000. If I have to split it exports were 1,30,000 domestic was the remaining. For the current year we are taking monthly run rate at 3,50,000 and exports being at 1,60,000 per month that is for FY15 and for FY16 we are assuming 3,80,000-3,90,000 kind of volumes and slightly below 50 percent of that coming from exports.

On the valuations side on FY17 estimates the stock is trading closed to 16 times. So, that is why I was saying the stock looks fairly valued at the current prices and we prefer Hero Motocorp versus Bajaj from the current point.

Ekta: I didn’t catch your target price in Bajaj Auto?

A: Rs 2,601 as per our last report.

SEE A SURGE IN DEMAND FROM NIGERIA: BAJAJ AUTO'S MD RAJIV

Bajaj Auto Managing Director Rajiv Bajaj said his company will partly pass on the forex impact in Nigeria to customers there, and the rest will be absorbed between the company and its distributors.

Nigeria has devalued its currency, Naira, by 10 percent and raised interest rates to record levels as it struggles to make up for falling revenues due to weak crude oil prices.

In an interview to CNBC-TV18’s Latha Venkatesh and Sonia Shenoy, he said Bajaj products in Nigeria would now be priced based on a level of 175 Naira/USD instead of 160 Naira/USD earlier.

Nigeria is the biggest export market for Bajaj Auto, accounting for 35 percent export revenues. Bajaj Auto sold 5 lakh motorcycles in Nigeria last fiscal and had a 44 percent market share in FY14, compared to 34 percent the year before.

He said demand from Nigeria has been strong so far, and he expected the trend to sustain despite the recent upheaval over falling crude prices.

Bajaj said his company operated at a conversion value of Rs 60.31 to the dollar during the first half of the year. He said hedging between Rs 60-64 would help cushion any forex impact.

Below is the transcript of Rajiv Bajaj's interview with Latha Venkatesh and Sonia Shenoy on CNBC-TV18.

Latha: What is the total amount of money you make out of the Nigerian market and how much will this 8 percent more expensive two wheelers impact your earnings?

A: There is no doubt that Nigeria is our biggest export market. In recent months we have actually been doing close to 50000 motorcycles a month and 5000 three-wheelers. Obviously this is an important issue for us and as you can imagine we have been tracking it. So far from what we understand the situation is pretty much under control.

I will break it into two parts, one is as far as volumes are concerned, volumes are very robust right now mainly for one reason that a couple of years back if I may say so somewhat arbitrarily, certain bans were imposed particularly on the motorcycle being flied in places like Lagos. Now over time that has got somewhat diluted because people have realised that for last mile transportation these vehicles are very important. Therefore we are seeing a surge in demand which explains why volumes in recent months are as robust as they are.

Let me tell you that concerned as we are with the forex, we were holding our breath as we were to receive orders for next month and next month orders are very robust with 50000 motorcycles and over 5000 three-wheelers. So on that front all is well so far.

As far as the forex and pricing itself is concerned a simple number would be like this that typically our products when they are priced in Nigeria, we work around 160 Naira/USD whereas now we have come to believe that we must come to terms with something like Naira 175/USD. Now this may or may not match exactly with the bank rate because the bank rate at the end is only a bank rate, one has to also look at the availability of the money especially for somebody like us who is such a large exporter and for our distributor to get adequate funds, we are looking more at 175/USD. So 160-175/USD is about 10 percent change and I think this will be addressed in three parts as it always is. One part is to pass some of the price increase to customers and I think all major players have already done that to a large degree. In the past week we have already passed on up to 4-5 percent in terms of retail price change. So at least a third if not half of this will be accounted for in this manner.

The balance will be shared between the distributor and ourselves. The distributors have grown strongly year-on-year with over 20 percent growth so clearly there is a possibility for them to absorb part of this.

On our own part for the first half of this year we operated at about Rs 60.3/USD. Now that has drifted closer to 61.5-62/USD and infact going forward I can let you know that for the next financial year for example, a very large portion of our anticipated exports is hedged at a minimum of Rs 64/USD. So from 60 to 64 itself provides a cushion of about 7 percent or so. So if some of that has to be sacrificed to keep the business going in terms of numbers and the topline, so be it. So I don’t feel that the situation is out of control as of now.

Sonia: What are you building in in terms of export growth by the end of FY15 to the Nigerian market and post this news flow would you scale down your estimates?

A: As of now I would not make any change because we have passed on a price increase and the rest we are able to absorb and we are still seeing very strong volumes. Infact the two-wheelers in particular is growing very smartly and I would expect that for the rest of this fiscal we should continue to see more or less the same growth year-on-year as we have witnessed so far.

Now whether that will be exactly 50000 motorcycles and 5000 three-wheelers a month going forward remains to be seen because this is a somewhat softer period anyway in Nigeria. But year on year if you have to compare last December to this, I think we will continue to see a strong double digit growth.

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.63.07
UK Pound	1	Rs.98.73
Euro	1	Rs.77.46

INFORMATION DETAILS

Information Gathered by :	PRT
Analysis Done by :	SUB
Report Prepared by :	SPR

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	10
PAID-UP CAPITAL	1~10	9
OPERATING SCALE	1~10	9
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	9
--PROFITABILIRY	1~10	9
--LIQUIDITY	1~10	9
--LEVERAGE	1~10	9
--RESERVES	1~10	9
--CREDIT LINES	1~10	9
--MARGINS	-5~5	--
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	YES
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	YES
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
DEFAULTER
RBI	YES/NO	NO
EPF	YES/NO	NO
TOTAL		82

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
--	NB	New Business	--

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.