WABCO-TVS (INDIA) LIMITED
ANNUAL REPORT 2010-2011
Speech delivered by the Chairman of the meeting at the Seventh Annual
General Meeting of WABCO-TVS (INDIA) Limited held on 27th July 2011
Ladies and Gentlemen
I have great pleasure in welcoming you all to this seventh annual general
meeting of your Company.
The Directors' report and the audited results of the Company for the year
ended 31st March 2011 are with you. I take this opportunity to brief you on
the progress made by the Company during the year under review.
ECONOMIC AND INDUSTRY REVIEW
India's GDP for the full year 2010-11 stood at 8.5% as against previous
estimate of 8.6%. This was mainly due to lower economic growth during the
last quarter. The growth was at 7.8% as against earlier estimate of 8.5%.
This drop was primarily due to a poor show by the manufacturing and mining
sectors. According to the estimates, the GDP growth in the current fiscal
year would suffer if the inflation continues to remain high.
The base year for computation of Index of Industrial Production (IIP) was
changed to 2004-05 as against 1993-94 followed earlier. Under this changed
base year, the IIP for April 2011 shows a growth of 6.3% Year on Year (4.4%
under the old index). Further manufacturing weight in the new IIP was
reduced by about 4% while the weight for mining sector was raised by a
The commercial vehicle industry registered a significant growth in 2010-11.
The sales volume in the Medium and Heavy Commercial Vehicle (MHCV) clocked
a growth of 33% over 2009-10. This was a result of heightened industrial
activity, government focus on infrastructure development, rapid
urbanization, robust freight demand and improved transporter profitability.
During the year under review, the Company achieved a turnover of Rs 899
crores as against Rs 609 crores in 2009-10, registering an impressive
increase of 48%. The growth in the turnover was due to improved economic
activity which resulted in growth in commercial vehicle industry. The
company was also benefited by higher sales from spares and exports. In the
spares segment, sales increased from Rs 109 crores to Rs 139 crores and in
the export segment sales grew from Rs 55 crores to Rs 118 crores.
The Profit after tax stood at Rs 127 crores in 2010-11 as against Rs 78
crores in 2009-10 registering a very significant increase of 62%. The
earnings per share on a face value of Rs 5/- per share improved from Rs
41.22 in 2009-10 to Rs 67.18 in 2010-11.
During the year WABCO continued to make a very significant contribution to
technology and business operations. WABCO is the global technology
leader in the commercial
vehicle industry. For over 140 years, WABCO has pioneered breakthrough
electronic, mechanical and mechatronic technologies for braking, stability
and transmission automation systems supplied to the world's leading
commercial truck, trailer and bus manufacturers. Across the globe, WABCO,
leverages innovation, new technologies and a powerful network of talents
and operations to best serve vehicle manufacturers and operators. In 2010,
WABCO increased global sales by 47 percent to $2.2 billion in local
currencies. WABCO seeks to lead the world in the creation and supply of
products and systems that enhance the safety and efficiency of commercial
The board of directors have recommended a dividend of Rs 5 per share (100%)
for the year ended 31 st March 2011 as against Rs 2.50 per share (50%) for
the year ended 31 st March 2010.
NEW PRODUCT DEVELOPMENT
The Company has introduced many new products to Indian OEMs during the year
2010-11. The Company has commenced supplies of the following new products/
* Localized Clutch servos for medium and heavy commercial vehicles
* Higher capacity Compressors and new variants of compressors for domestic
* New brake system aggregates for various vehicle models of Ashok Leyland,
like the Future Vehicle Development Program (FVDP)
The Company has also been awarded contracts for design, development and
supply of many new products for domestic and export market which includes:-
* Anti-Lock Braking (ABS) System to Bharat Earth Movers Limited (BEML)
* Automated Manual Transmission (AMT) for Ashok Leyland and TATA Motors
* Brake Actuators and Valves for VOLVO's Asia Truck Program
* Exhaust Brake System for Daimler
The Company is also in the process of implementing in series production of
many customized new products and systems for domestic market as well as for
WABCO Worldwide. We are continuing to develop our Product Development
capability to global standards.
TEI & TPM
The Company continued to achieve 100% participation in Total Employee
Involvement (TEI) activities for the 12th year in succession at our
Ambattur plant. During the year 2010-11 these TEI practices were extended
to the company's other manufacturing locations viz. Jamshedpur and Mahindra
Similarly Total Productive Maintenance (TPM) implementation has been
extended to the aforementioned plants.
With Total Quality Management (TQM) as the foundation, the Company
continues its thrust on Total Productive Maintenance (TPM) and Lean
manufacturing for enhancing customer satisfaction and improved business
During the year under review, the Company has won the following awards
* 'India Manufacturing Excellence Super Platinum award' and 'Consistency
award' from Frost & Sullivan
* 'INNOVENDOR Award' from TATA Motors
* 'Overall Quality Excellence Award' from VOLVO Eicher
* 'Certificate of Appreciation for Performance in Supply Linearity' from
* 'First prize in Quality Circle Convention' for Supervisors and Managers
* 'Gold Award' from Quality Circle Federation of India at their
* 'Excellence in Technology and Innovation' from TATA Motors at their
National Vendors' Meet 2011
* 'Excellence in Quality' Award from TATA Motors at their National Vendor's
* National Award for 'Excellence in Cost Management' from The Institute of
Cost and Works Accountants of India. We won the award in the category of
Manufacturing, Medium Organization.
OUTLOOK FOR THE CURRENT YEAR
The production of commercial vehicles with air brakes registered an
increase by 9% during the last quarter of 2010-11. With the increased
infrastructure development projects coupled with the growth in agricultural
output has resulted in improved freight availability. The air brake vehicle
industry is likely to register a positive growth of 9% during the current
year 2011-12. There are some initial concerns with increasing interest
rates and diesel prices, but demand will continue to be robust with
increased industrial activity.
COMPANY NAME CHANGE
In line with the agreement entered with Sundaram-Clayton Limited, after the
acquisition of the equity shares by Clayton Dewandre Holdings Ltd from TVS
group, the name of the Company is proposed to be changed to WABCO INDIA
LIMITED from WABCO-TVS (INDIA) Limited. This is subject to approval of
shareholders at this meeting and also of Central Government as per the
applicable provisions of the Companies Act, 1956.
The board of directors thank the shareholders for the trust and confidence
reposed in the Company. I would like to thank the promoter Messrs. Clayton
Dewandre Holdings Limited an indirect subsidiary of WABCO Holdings Inc. for
their continued support to the business. I would also like to thank our
customers, suppliers and State Bank of India, banker to the Company, for
their continued co-operation and support.
All the employees of the Company deserve special appreciation for their
continued commitment to the Company in achieving an outstanding performance
during the year.
I would like to thank the Governments of Tamil Nadu and Jharkhand for all
the support in our operations.