2005-06 ANNUAL REPORTTitle: 2005-06 ANNUAL REPORT.pdf Created Date: 5/8/2006 8:12:56 AM

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16 TH ANNUAL REPORT 2005-06

Company Information

Visit us at www.autostampings.com

Board of DirectorsD.S. Gupta (Chairman)R.A. SavoorS. RamakrishnanAtul BansalSatish PradhanRajiv DubeRaman NandaB. Venkataramani

SecretaryShailendra Dindore

BankersHDFC BankState Bank of IndiaSociete Generale

Registered OfficeG-71/2, MIDC Industrial Area,Pune 411 026, Maharashtra

AuditorsM/s Price WaterhouseChartered Accountants

WorksG-71/2, MIDC Industrial Area,Bhosari, Pune 411 026,Maharashtra

Gat No. 427, Medankarwadi, ChakanMaharashtraTaluka Khed, Pune 410 501, Maharashtra

Survey No. 173, Village-Khakharia,Taluka Savli, Near GIDC,Halol 389 350,Gujarat

Share Transfer AgentMCS Limited1st Floor, 116-118, Akshay Complex,Off Dhole Patil Road, Near Ganesh Mandir,PUNE – 411 001.Tel: (020) 30906685Fax : (020) 26129597

Contents

Financial Highlights 2

Notice 3

Directors' Report 10

Report on Corporate Governance 15

Auditors’ Report 26

Balance Sheet 30

Profit and Loss Account 31

Schedules 32

Cash Flow Statement 47

Balance Sheet Abstract 49

Proxy Form 51

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(Rs. in '000)

2001-02 2002-03 2003-04 2004-05 2005-06

Sales & Other Income 982,260 1,481,684 1,804,657 2,505,190 2,786,185

Profit before Interest, Depreciation,Tax and Extraordinary Income 108,002 111,099 191,026 170,229 188,694

Extraordinary Income - 182,620 35,050 - -

Profit After Tax (25,933) 121,585 73,208 40,175 46,447

Share Capital 101,985 221,985 221,985 221,985 221,985

Reserves and Surplus 194,859 194,859 215,871 225,672 241,745

Shareholders’ Funds 296,844 416,844 437,856 447,657 463,730

Loan Funds 681,872 262,842 164,871 374,376 365,121

Total Capital Employed 978,716 679,686 602,727 822,033 828,851

Gross Block 798,742 824,612 850,412 996,147 1,033,199

Depreciation 214,679 283,590 358,006 448,512 544,489

Net Block 584,063 541,022 492,406 547,635 488,710

Net Current Assets 48,836 84,948 98,976 218,752 238,915

Preference Dividend - - 21,738 14,400 14,400

Equity Dividend - - - 12,238 12,238

Rate of Dividend - - - 12% 12%

No.of Shareholders 1,907 1,857 2,651 3,654 2,971

Earnings Per Share (2.54) 11.11 5.59 2.33 2.94

Financial Highlights

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NOTICE is hereby given that the Sixteenth Annual General Meeting of the members of AutomotiveStampings and Assemblies Limited will be held on Tuesday, the 30th day of May, 2006 at 2:30 P.M. at“Nehru Memorial Hall”, Atur Foundation House, 4, Dr. Ambedkar Road, Pune 411 001, to transact thefollowing business:

ORDINARY BUSINESS:

1. To receive, consider and adopt the Audited Balance Sheet as at 31st March, 2006 and the Profitand Loss Account for the year ended on that date and the Report of the Directors and Auditorsthereon.

2. To declare dividend on 12% Cumulative Redeemable Preference Shares.

3. To declare dividend on Equity Shares.

4. To appoint a Director in place of Mr. D. S. Gupta who retires by rotation and being eligible, offershimself for re-appointment.

5. To appoint a Director in place of Mr. Satish Pradhan who retires by rotation and being eligible,offers himself for re-appointment.

6. To appoint Auditors and to fix their remuneration.

SPECIAL BUSINESS:

7. To consider and if thought fit, to pass, with or without modifications, the following resolution as anOrdinary Resolution:

“RESOLVED THAT Mr. R. A. Savoor, be and is hereby appointed as Director of the Company andshall be liable to retire by rotation.”


“RESOLVED THAT Mr. S. Ramakrishnan, be and is hereby appointed as Director of the Companyand shall be liable to retire by rotation.”


“RESOLVED THAT Mr. B. Venkataramani, be and is hereby appointed as Director of the Companyand shall be liable to retire by rotation.”


“RESOLVED THAT pursuant to the provisions of Section 198, 269, 309 and other applicableprovisions of the Companies Act, 1956, read with and in accordance with the conditions specifiedin Schedule XIII to the said Act and subject to the approval of the Central Government, if necessary,the Company hereby approves of the appointment and terms of remuneration of Mr. Rajesh Sahayas “Manager” u/s 269 of the Companies Act, 1956 from 19th April, 2006 to 31st March 2007, uponthe terms and conditions as set out below and in the Agreement entered into in this behalf, withliberty to the Board of Directors and/or Remuneration Committee, to alter and vary the terms andcondition of the said appointment and/or Agreement in such manner as may be agreed to betweenthe Directors and Mr. Rajesh Sahay (“the appointee”):-

NOTICE

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i. Remuneration:

a. Salary: In the scale of Rs.43,000/- to Rs.50,000/- per month with authority to the Boardand/or Remuneration Committee to fix his salary within the above scale from time totime. Present salary being Rs.43,000/- per month. The increments may be decided bythe Board and /or Remuneration Committee from time to time subject however to anamount not exceeding Rs. 50,000/- per month.

b. Incentive Remuneration: Upto 100 % of salary to be paid at the discretion of theBoard and/or Remuneration Committee and is based on certain performance criteria.

c. Perquisites and allowances: The appointee will be entitled to the perquisites andallowances as per the Company rules in addition to the salary and incentiveremuneration. Such perquisites and allowances will be subject to a maximum of 175%of his annual salary.

� In arriving at the value of the perquisites insofar as there exists a provision forvaluation of perquisites under the Income Tax Rules, the value shall be determinedon the basis of Income Tax Rules in force from time to time.

� Provision for use of Company’s car for official duties and telephone at residenceshall not be included in the computation of perquisites and allowances for thepurpose of calculating the said ceiling.

� Company’s contribution to Provident Fund and Superannuation Fund or AnnuityFund, to the extent these either singly or together are not taxable under theIncome-tax Act, Gratuity payable as per the rules of the Company and encashmentof leave at the end of the tenure shall not be included in the computation of limitsfor the remuneration or perquisites aforesaid.

ii. Minimum Remuneration:

Notwithstanding anything to the contrary herein contained, where in the financial year duringthe currency of the tenure of Mr. Sahay, the Company has no profit or its profits are inadequate,the Company may pay remuneration by way of salary, incentive remuneration, perquisitesand allowances as specified above.

BY ORDER OF THE BOARDfor Automotive Stampings and Assemblies Limited

Shailendra DindorePune, April 19, 2006 Secretary

Registered Office:G-71/2, M.I.D.C. Industrial Area,Bhosari, Pune 411026

NOTICE

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NOTES

1. Explanatory Statements under section 173(2) of the Companies Act, 1956 relating to SpecialBusiness to be transacted at the meeting are annexed hereto and form part of the notice.

2. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT APROXY TO ATTEND AND ON A POLL ONLY TO VOTE INSTEAD OF HIM/HER. SUCH PROXYNEED NOT BE A MEMBER OF THE COMPANY. PROXIES IN ORDER TO BE EFFECTIVE MUSTBE RECEIVED BY THE COMPANY NOT LESS THAN 48 HOURS BEFORE THE MEETING.

3. Members are requested to bring their personal copy of the Annual Report to the meeting.

4. Queries on accounts and operations of the Company, if any, may please be sent to the Companyseven days in advance of the Meeting so that the answers may be made available at the Meeting.

5. The Register of Members and Share Transfer Books of the Company shall remain closed from24th May, 2006 to 30th May, 2006 (both days inclusive) for the purpose of payment of dividend tothose Members whose names stand on the Register of Members as on 30th May, 2006. Thedividend in respect of Equity Shares held in electronic form will be payable to the beneficial ownersof the Equity Shares as at the end of business hours on 23rd May, 2006 as per the details furnishedby the depositories for this purpose.

6. The dividend on Equity Shares as recommended by the Directors for the year ended31st March, 2006 will be payable on or after 30th May, 2006 in accordance with the resolution to bepassed by the Members of the Company.

7. To avoid loss of dividend warrants in transit and undue delay in respect of receipt of dividendwarrants, the Company has provided a facility to the Members for remittance of dividend throughElectronic Clearing System (ECS). The ECS facility is available at locations identified by ReserveBank of India from time to time and covers most of the cities and towns. Members holding sharesin physical form and desirous of availing this facility are requested to contact the Company’sRegistrars and Transfer Agent.

8. Members holding shares in dematerialised mode are requested to intimate all changes pertainingto their bank details, ECS mandates, power of attorney, change of address/name, etc. to theirdepository participant only and not to the Company’s Registrar and Transfer Agent. Changesintimated to the depository participant will help the Company and its Registrars and Transfer Agentto provide efficient and better services to the Members.

9. Under section 205A of the Companies Act, 1956, the amount of dividend remaining unpaid orunclaimed for a period of seven years from the date of payment is required to be transferred to theInvestor Education and Protection Fund (IEPF) set up by the Central Government. Accordingly,the Company has transferred the unclaimed dividend of 1997-98 to the IEPF during the year.

The shareholders who have not encashed the dividend for 2004-05 so far are requested to maketheir claim to the Registrar and Transfer Agent.

10. The Company has paid the annual listing fee to the respective stock exchanges for the financialyear 2006-07.

11. As per the scheme of arrangement (demerger) between the Company and JBM Auto Limited(formerly known as JBM Auto Components Limited), the shareholders of the Company were requiredto surrender the original share certificates of the Company for exchange of new shares of both theCompanies. Those who have not yet surrendered the share certificates of the Company forexchange are requested to handover / send the same to the Company’s Registrar & Share TransferAgent.

NOTICE

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Explanatory Statements

The following Explanatory Statements pursuant to Section 173 of the Companies Act, 1956, set out allmaterial facts relating to the business mentioned at Item Nos. 7 to 10 in the accompanying Notice dated19th April, 2006.

ITEM NO. 7

The Board of Directors appointed Mr. R. A. Savoor as Additional Director of the Company w.e.f.29th December, 2005. The term of office of Mr. Savoor expires at the forthcoming Annual General Meeting.

Notice has been received from a shareholder of the Company under Section 257 of the CompaniesAct, 1956 alongwith the requisite deposit, proposing the candidature of Mr. Savoor for the office of Director.

A brief profile of Mr. Savoor is as under: -

Age 62

Qualifications B. Sc. (Chemistry) ,B.Sc. (Tech.)

Expertise in specific functional areas Mr. Savoor is the former Managing Director of CastrolIndia Limited. He has over 34 years of experience in thefield of Sales, Marketing, R&D, Production, Projects,Supply Chain & Human Resource.

Chairman / Director of other Foseco India LimitedCompanies E.I.D. Parry Limited

Fidelity Fund Management Private LimitedDivgi Warner Private LimitedApara Enterprise Solutions Private Limited

Chairman / Member of Committees Auditof the Boards of Companies of Foseco India Limitedwhich he is a Director E.I.D. Parry Limited

Divgi Warner Private LimitedApara Enterprise Solutions Private Limited

Shareholders’ Grievance CommitteeFoseco India Limited

The Company will benefit immensely from his extensive experience.

The Directors commend the resolution for approval.

None of the Directors except Mr. Savoor is concerned or interested in the above resolution.

ITEM NO. 8

The Board of Directors appointed Mr. S. Ramakrishnan as Additional Director of the Company w.e.f.29th December, 2005. The term of office of Mr. Ramakrishnan expires at the forthcoming Annual GeneralMeeting.

Notice has been received from a shareholder of the Company under Section 257 of the CompaniesAct, 1956 alongwith the requisite deposit, proposing the candidature of Mr. Ramakrishnan for the officeof Director.

NOTICE

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NOTICEA brief profile of Mr. Ramakrishnan is as under: -

Age 57

Qualifications B.Tech. (Mechanical), P.G. D.M. (IIM - Ahmedabad)

Expertise in specific functional areas Mr. Ramakrishnan is the Executive Director – Financeof The Tata Power Company Limited. He was theManaging Director of Tata Teleservices Limited. He wasalso the Deputy Managing Director of Indian HotelsCompany Limited. He has over 30 years of experiencein the field of management and operations.

Chairman / Director of other Companies THDC LimitedTata Projects Limited.Avaya Global Connect LimitedThe Tata Power Company LimitedPowerlinks Transmission LimitedTata Power Trading Co. LimitedNelco LimitedAf-Taab Investment Co. LimitedMaithon Power Limited

Chairman / Member of Committees Auditof the Boards of Companies of which Powerlinks Transmission Limited - Chairmanhe is a Director Tata Power Trading Co. Limited - Chairman

THDC LimitedTata Projects LimitedAvaya Global Connect Limited

Shareholders’ Grievance CommitteeThe Tata Power Company Limited



None of the Directors except Mr. Ramakrishnan is concerned or interested in the above resolution.

ITEM NO. 9The Board of Directors appointed Mr. B. Venkataramani as Additional Director of the Company w.e.f.21st October, 2005. The term of office of Mr. Venkataramani expires at the forthcoming Annual GeneralMeeting.

Notice has been received from a shareholder of the Company under Section 257 of the CompaniesAct, 1956 alongwith the requisite deposit, proposing the candidature of Mr. Venkataramani for the officeof Director.

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A brief profile of Mr. Venkataramani is as under: -

Age 54

Qualifications B. Sc., B. E., P. G. D. M.

Expertise in specific functional areas Mr. Venkataramani is the Chief Executive Officer ofTechnical Stampings Automotive Limited. He has over29 years of experience in the field of marketing andoperations.

Chairman / Director of otherCompanies -

Chairman / Member of Committeesof the Boards of Companies ofwhich he is a Director -



None of the Directors except Mr. Venkataramani is concerned or interested in the above resolution.

ITEM NO. 10

The Board of Directors appointed Mr. Rajesh Sahay as “Manager” of the Company for a period from19th April 2006 to 31st March 2007.

Mr. Sahay, 49, has been working with the Company as a Chief Operating Officer with effect from2nd December, 2005. He is a Mechanical Engineer. He has also completed Advance Training in AutomobileCab Assembly and Factory Management at Toyota Motors, Japan. He has over 25 years of Industrial andBusiness management experience. Prior to joining the Company, he was working with Jay Bharat MarutiLimited. He started his career with Tata Motors, Jamshedpur. He also handled various assignments atDCM Toyota.

The Remuneration Committee of the Board has approved the remuneration payable to him.

The appointment and the remuneration payable to him are subject to the approval of the members.

The resolution containing the details of the remuneration and seeking approval of the Members is givenunder Item No. 10 of the Notice convening the Meeting.

Besides the terms and conditions for payment of managerial remuneration as contained in the proposedresolution, the other main terms and conditions, contained in the agreement entered into in this behalfwith the appointee are as given below:

(1) The terms and conditions of the said agreement and/or appointment may be revised,enhanced, altered and varied from time to time by the Board of Directors of the Companyand/or Remuneration Committee in such manner as may be agreed to between the Boardand the appointee within the maximum amounts payable to managerial person in accordancewith the provisions of the Companies Act, 1956 or any amendments or re-enactments thereofmade hereafter in this regard.

(2) The appointee is subject to the supervision and control of the Board of Directors, entrustedwith substantial powers of management and shall also perform such other duties as mayfrom time to time be entrusted to him.

(3) The appointee shall not, either before or after the termination of this Agreement, disclose toany person whatsoever, any information relating to the Company or its customers or anytrade secret of which he may come to know while acting as the Manager.

NOTICE

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(4) The appointee shall not be entitled to supplement his earnings under the Agreement withany buying or selling commission. He shall not also become interested or otherwise concerneddirectly or through his wife and/or minor children in any selling agency of the Company,without the prior approval of the Central Government.

(5) If at any time, the appointee ceases to be in the employment of the Company for any causewhatsoever, he shall cease to be the Manager of the Company and this agreement willforthwith terminate.

(6) In case the appointee dies in the course of his employment, the Company shall pay to hislegal personal representative the salary and current emoluments for the then current month.

(7) The appointee shall not have the following powers -

i) the power to make calls on shareholders in respect of money unpaid on their shares inthe Company.

ii) the power to issue debentures.

iii) the power to invest the funds of the Company in shares, stocks and securities.

(8) The agreement may be terminated by either party by giving three months’ notice of suchtermination or paying three months’ salary in lieu thereof.

In compliance with the provisions of Section 269, 309 and other applicable provisions of the Act,the appointment upon the terms and conditions specified above is now being placed before theMembers in general meeting for their approval.

The Agreement between the Company and the appointee is available for inspection by the Membersof the Company at its Registered Office between 11.00 a.m. to 1.00 p.m. on any working day of theCompany.

This may be treated as an abstract of the draft Agreement between the Company and the appointeepursuant to Section 302 of the Act.

The Board commends the Resolution for acceptance by the Members.

None of the Directors of the Company is interested in this resolution.

BY ORDER OF THE BOARDfor Automotive Stampings and Assemblies Limited

Shailendra DindorePune, April 19, 2006 Secretary

Registered Office:G-71/2, M.I.D.C. Industrial Area,Bhosari, Pune 411026

NOTICE

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DIRECTORS' REPORTDear Members,

Your Directors have pleasure in submitting their Sixteenth Annual Report on the business and operationsof the Company together with the Audited Statement of Accounts for the year ended 31st March 2006.

FINANCIAL AND OPERATIONAL PERFORMANCE

The summarised financial results of the Company for the period under review are:

(Rs. in million)

Financial Year

2005-06 2004-05

Sales 2,767.96 2,498.84

Other Income 18.22 6.35

Profit before Depreciation, Financial Charges and Tax 188.69 170.23

Less: Depreciation 98.27 91.11

Financial Charges 19.57 13.93

Profit before Tax 70.85 65.19

Less: Provision for Taxation

a. Current Tax 28.10 5.20

b. Deferred Tax Expense / (Credit) (4.30) 19.81

c. Fringe Benefit Tax 1.25 -

d. Excess provision for taxation in respect ofearlier years written back (0.65) -

Profit After Tax 46.45 40.18

Balance from last year 22.81 17.01

Profit available for appropriation 69.26 57.19

Appropriations:

- Transfer to General Reserve 4.50 4.00

- Proposed Dividend on Preference Shares 14.40 14.40

- Proposed Dividend on Equity Shares 12.24 12.24

- Tax on Dividend 3.74 3.74

Balance Carried Forward 34.38 22.81

The growth in sales was essentially due to increased volumes of the customer programmes beinghandled by the Company.

The increase in other income is mainly due to higher gain on mutual fund investments and write back ofprovision no longer required.

The impact of increase in steel prices has resulted in increase in input costs during the year. The effortsof the Company to reduce process cost and improve efficiencies have started giving positive results.

Depreciation has increased mainly due to the additions to the fixed assets. Increase in financial chargesis due to drawal of term loans for ongoing expansion.

After making a provision of Rs. 24 million towards taxation, the Company’s Profit after tax wasRs.46 million as against Rs. 40 million in 2004-05.

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DIRECTORS' REPORTDIVIDEND

The Directors recommend payment of dividend on the 12% Cumulative Redeemable Preference Sharesfor the year 2005-06 as per the terms of issue. It would lead to an outflow of Rs.16 million, inclusive ofdividend tax.

The Directors also recommend an equity dividend at 12% (Rs. 1.20 per share) for the year 2005-06. Itwould lead to an outflow of Rs. 14 million, inclusive of dividend tax.

EXPANSION

The second phase of Chakan Expansion is delayed due to delay in receipt of the machinery from thesupplier. It is expected to be completed by end of June, 2006.

INDUSTRY STRUCTURE AND DEVELOPMENTS

The global attention has now steadily been shifted towards India. The Indian auto component industryhas made a number of acquisitions in US, EU, etc. The Indian industry is gaining global credibility as animportant partner that can infuse a new lease of life to the languishing firms in the high-cost countries.

OPPORTUNITIES

Rising incomes in India have generated an increasing number of buyers for the cars. With India beingthe fourth largest market in Asia, it is offering excellent opportunities for the car segment.

Indian Auto Industry is the largest market in the World for the Two Wheelers, Three Wheelers, PassengerVehicles and the Commercial Vehicles.

Issues of scale, logistics, delivery schedules are the operational challenges before the industry.

SEGMENT-WISE PERFORMANCE

The Company operates only in the Automobile Component Segment and hence segment-wise reportingis not applicable to the Company.

FUTURE OUTLOOK

The Indian auto industry showed a 12.8% increase with nearly 89 lakh vehicles sold in 2005-06. All thefour major segments – passenger, commercial, three wheelers and two wheeler showed a good growth.The commercial vehicle segment registered a 10.1% growth. In passenger vehicles segment with 7.7%growth, the car sales were up by 7.5% and utility vehicles were up by 10.3%.

The reduction in excise duty on small cars will boost demand for cars and therefore, auto components.This rate cut would go a long way towards making India a hub for manufacture of small and fuel efficientcars.

The future drivers for growth are increasing road development, increasing disposable income with theservice sector, replacement of aging four wheelers, graduating from two wheelers to four wheelers,increasing dispensable income of rural agriculture sector, etc.

The Company has been planning to increasingly move up the value chain with modules and aggregates.The Company is also planning to develop technical competencies and strengthen the project managementcapabilities. Initiatives for yield improvement are underway.

RISKS AND CONCERNS

The continued rise in the cost of steel, the major input has an adverse impact on the profitability of theCompany. The penalties for poor quality, assembly line stoppage, product recalls are the risks ahead ofincreasing presence in global trade.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has a system of internal controls in place to ensure that all the transactions are properlyrecorded and authorised. The internal control system is supplemented by documentary policies andprocedures. The same is further supplemented by a programme of audits by the Internal Auditors whoperiodically present their observations to the audit committee. During the year, the Company hasimplemented SAP across all its manufacturing plants.

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DIRECTORS' REPORTHUMAN RESOURCES

The Company has strength of 578 employees as on 31st March, 2006.

Harmonious industrial relations continued to prevail at all the units of the Company. The Company hassigned long-term productivity linked wage agreements with the trade unions at Bhosari and Chakanplants.

QUALITY INITIATIVES

All the plants of the Company are certified under TS 16949. The Company has already adopted the TataBusiness Excellence Model for its journey to business excellence. The Company is in the process ofobtaining ISO 14000 accreditation.

DIRECTORS

Appointments

Mr. B. Venkataramani was appointed as Additional Director with effect from 21st October, 2005. Mr. R. A.Savoor and Mr. S. Ramakrishnan were also appointed as the Additional Directors with effect from29th December, 2005.

They hold office up to the date of the ensuing Annual General Meeting of the Company. Notices havebeen received from members of the Company proposing their candidature for the office of the Director.The Directors recommend their appointments.

Resignations

Mr. Rajiv Bakshi resigned as Director of the Company with effect from 21st October, 2005.

Further, Mr. Shantanu Rudra, Mr. Gajendra Chandel and Mr. Sandip Choudhuri were appointed as theAdditional Directors with effect from 21st October, 2005. Mr. Chandel and Mr. Choudhuri resigned asDirectors with effect from 29th December, 2005. Mr. Rudra resigned as Director with effect from22nd February, 2006.

The Board of Directors places on record its appreciation for the valuable services rendered by themduring their tenure of directorship.

Retirement by Rotation

Mr. D. S. Gupta and Mr. Satish Pradhan will retire by rotation at the conclusion of the forthcoming AnnualGeneral Meeting and are eligible for re-appointment.

MANAGER

Mr. Rajesh Sahay was appointed as Manager under the Companies Act, 1956 effective 19 April, 2006.The necessary resolution for obtaining the approval of the shareholders for the appointment of Mr. Sahayas the Manager of the Company has been included in the notice of the ensuing Annual General Meeting.

CORPORATE GOVERNANCE

As a listed Company, necessary measures are taken to comply with the requirements of the ListingAgreement with the stock exchanges. A report on Corporate Governance, along with a certificate ofcompliance from the Auditors, forms a part of this Report.

THE DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors confirm that -

1. In the preparation of the annual accounts, the applicable accounting standards have been followedand that there are no material departures;

2. They have, in the selection of the accounting policies, consulted the auditors and have applied themconsistently and made judgements and estimates that are reasonable and prudent so as to give atrue and fair view of the state of affairs of the Company at the end of the financial year and of theprofit of the Company for that period;

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DIRECTORS' REPORT3. They have taken proper and sufficient care, to the best of their knowledge and ability, for the

maintenance of adequate accounting records in accordance with the provisions of the CompaniesAct, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;

4. They have prepared the annual accounts on a going concern basis.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGSAND OUTGO

Information on conservation of energy, technology absorption, foreign exchange earnings and outgorequired in terms of Section 217(1)(e) of the Companies Act, 1956, read with Companies (Disclosure ofParticulars in the Report of Board of Directors) Rules, 1988 is given in the enclosed Annexure.

PARTICULARS OF EMPLOYEES

The details of employee of the Company who received remuneration in excess of the limits prescribedunder section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees)Rules, 1975 are submitted herein below:

Mr. Vilas Divadkar (Age 53), Chief Executive Officer, Date of employment: 4th April, 2005,Experience: 31 years, Remuneration received Rs.34,90,805/-, Qualification: B.E. (Mech.) and Diplomain Business Management, Last employment held: Electrolux Kelvinator Limited (Executive Vice President).

(The remuneration includes salary, allowances, medical benefits, leave travel assistance, Company’s contributionto Provident fund and Superannuation fund and the monetary value of the perquisites. Mr. Divadkar is not related toany of the directors.)

AUDITORS

M/s. Price Waterhouse, Chartered Accountants, who retire at the conclusion of the forthcoming AnnualGeneral Meeting and being eligible, offer themselves for re-appointment.

FORWARD LOOKING STATEMENTS

Certain Statements describing the Future outlook, Industry structure and developments may be“forward – looking statements” within the meaning of applicable securities laws and regulations. Actualresults could differ materially from those expressed or implied. Important factors that could make adifference to the Company’s operations include economic conditions affecting demand / supply, priceconditions in domestic and overseas market in which the Company operates, changes in Governmentregulations, tax laws and other statutes.

ACKNOWLEDGEMENTS

The Directors wish to place on record their sincere thanks and appreciation for the guidance, support,continued co-operation extended by bankers, Central and State Governments, customers, suppliersand shareholders.

The Directors also take this opportunity to acknowledge the dedicated efforts of the employees.

For and on behalf of theBoard of Directors

D. S. GuptaMumbai, April 21, 2006 Chairman

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DIRECTORS' REPORTANNEXURE TO DIRECTORS’ REPORT

Information in accordance with the Companies (Disclosure of Particulars in the Report of Board ofDirectors) Rules, 1988:

A. CONSERVATION OF ENERGY

The Company has always been giving due consideration for the consumption of energy.

During the year under review:

a. Soft Starters have been put in the presses to reduce the energy consumption during no-loadcondition of the operation cycle.

b. Pneumatic hand tools have been replaced with electrical tools for reducing the load oncompressors required for generating compressed air.

An Energy audit by CII will be taken up in forthcoming year to stop all further energy wastages.

These measures are aimed at effective management and utilization of energy resources andresultant cost saving for the Company.

B. RESEARCH AND DEVELOPMENT & TECHNOLOGY ABSORPTION

For bringing in more reliability in the processes and equipment, the conventional controls arebeing changed to Programmable Logic Control. Weld Analyzer has been used extensively toestablish the most optimal working parameters to achieve quality at a reasonable cost.

As there is no separate R & D Department, the amount incurred on R & D is difficult to estimate.

C. FOREIGN EXCHANGE EARNINGS AND OUTGO

Earnings in foreign exchange 25.86

Expenditure in foreign currency 62.08

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1. Company’s Philosophy on Code of Governance

The Company’s philosophy of Corporate Governance is founded upon the adoption of the TataBusiness Excellence Model, the Tata Code of Conduct and the requirements of CorporateGovernance under clause 49 of the Listing Agreement with the Stock Exchanges. The governanceof the Company is guided by a strong emphasis on transparency, accountability and integrity.

The Company’s business objective is to manufacture its product in such a way as to createvalue that can be sustained over the long term for its customers, shareholders and employees.The Company is conscious of the fact that its success is a reflection of the professionalism,conduct and ethical values of its management and employees.

2. Board of Directors

Composition of the Board:

The present strength of Directors on the Board is eight. It comprises the Chairman, who is anon-executive director and other seven non-executive Directors, of whom three are independent.

None of the Directors on the Board is a member of more than 10 committees or Chairman ofmore than 5 committees across all companies in which he is a Director. The necessarydisclosures regarding committee positions have been made by all the Directors.

Code of Conduct for Directors and Senior Management:

The Board of Directors has approved adoption of the "Tata Code of Conduct" for the ExecutiveDirectors & the Senior Management of the Company and a “Code of Conduct for Non-ExecutiveDirectors” with effect from 1st January, 2006. The Code is available at www.autostampings.com.

All the Board Members and the Senior Management Personnel have confirmed the Compliancewith the Code for the year 2005-06.

Number of Board Meetings:

During the year 2005-06, five Board Meetings were held and the gap between two meetings didnot exceed four months. The dates on which the meetings were held are as follows: 28th April,25th July, 21st October in 2005, 24th January and 21st March in 2006.

Information placed before the Board:

Agenda papers along with detailed notes are being circulated in advance of each meeting of theBoard. Information required pursuant to Corporate Governance practices, as required underAnnexure I to clause 49 have been made available to the Board.

The Company periodically places the Compliance Reports of all applicable laws before the Boardof Directors for its review.

Directors with materially pecuniary or business relationship with the Company:

The Company did not have any pecuniary relationship or transactions with its Non-executiveand/or Independent Directors during 2005-06.

REPORT ON CORPORATE GOVERNANCE(Pursuant to Clause 49 of the Listing Agreement)

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Attendance at the Board Meetings & the last Annual General Meeting, Directorship inother companies and other Board Committee Memberships:

The names and category of Directors on the Board, their attendance at the Board Meetings heldduring the year and also at the last Annual General Meeting, the number of Directorships andCommittee Memberships held by them in other companies are given hereunder:

Name of Director Category of No. of Attendance Directorship No. of otherDirectorship Board at the last in other Committee

Meetings AGM held Companies** Memberships***Attended* on

06-06-2005Chairman Member

Mr. D.S. Gupta Chairman 5 Present 15 - -Non-Executive,

Not Independent

Mr. R.A. Savoor Non-Executive, 2 Not 5 - 5

(w.e.f. 29/12/05) Independent Applicable

Mr. S. Ramakrishnan Non-Executive, 1 Not 9 2 4

(w.e.f. 29/12/05) Independent Applicable

Mr. Atul Bansal Non-Executive, 1 Not Present - - -

Independent

Mr. Satish Pradhan Non-Executive, 3 Present 3 - 1Not Independent

Mr. Rajiv Dube Non-Executive, 1 Present 4 1 2

Not Independent

Mr. Raman Nanda Non-Executive, 5 Not Present 3 - 2

Not Independent

Mr. B. Venkataramani Non-Executive, 1 Not - - -

(w.e.f. 21/10/05) Not Independent Applicable

Mr. Rajiv Bakshi Non-Executive, 1 Present Not Applicable

(upto 21/10/05) Not Independent

Mr. Shantanu Rudra Non-Executive, 2 Not Not Applicable

(From 21/10/2005 to Not Independent Applicable

22/02/2006)

* No. of Board Meetings held during 2005-06: Five

** This includes Directorships held in private limited companies and excludes Directorshipsin foreign companies.

*** This covers membership / chairmanship of Audit Committee and Shareholder / InvestorGrievance Committee.

Notes:-

a. As per the provisions of Clause 49 of the Listing agreement, Mr. Satish Pradhan andMr. Rajiv Dube were Independent Directors upto 28th December, 2005.

b. Mr. Gajendra Chandel and Mr. Sandip Choudhuri were appointed as Additional Directors on21st October, 2005. They resigned as Directors with effect from 29th December, 2005. Theyattended the Board meeting held on 21st October, 2005.

REPORT ON CORPORATE GOVERNANCE

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3. Audit Committee

The Company has an Audit Committee comprising five members, three of them including theChairman are Independent Directors. All the members have relevant finance and audit exposure.The Chairman of the Committee is Mr. R. A. Savoor. Mr. S. Ramakrishnan, Mr. Atul Bansal,Mr. Satish Pradhan and Mr. Rajiv Dube are the other members of the Committee.

The Audit Committee meetings are attended by the Chief Executive Officer and the Chief FinancialOfficer. The representatives of Statutory Auditors and Internal Auditors are the permanent inviteesto the Audit Committee meetings. The Secretary of the Company acts as the Secretary of theAudit Committee.

The Chairman of the Audit Committee was present at the Annual General Meeting held on6th June, 2005.

�� Terms of Reference:

The Company has framed an Audit Committee Charter which covers all the audit committeerelated requirements of the Revised Corporate Governance Clause as well as therequirements of Section 292A of the Companies Act, 1956. The role of the Committee includesoverseeing the Company’s financial reporting process and disclosure of financial informationto ensure that the financial statement is correct, sufficient and credible; reviewing annualand quarterly financial statements with management before submission to the Board;reviewing the adequacy of internal control systems with management, external and internalauditors, reviewing the significant related party transactions and reviewing the Company’sfinancial risk and management policies.

�� Meetings and the attendance during the year:

Six Audit Committee Meetings were held during 2005-06. The dates on which the meetingswere held are as follows: 28th April, 25th July, 21st October in 2005, 23rd January, 28th Februaryand 28th March in 2006. One circular resolution was also passed during 2005-06.

The attendance of each member of the Audit Committee is given below:

Name of Director Category No. ofmeetingsattended*

Mr. R. A. Savoor, Chairman Non-Executive,(w.e.f. 29th December, 2005) Independent 3

Mr. S. Ramakrishnan Non-Executive,(w.e.f. 29th December, 2005) Independent 1

Mr. Atul Bansal Non-Executive,Independent 2

Mr. Satish Pradhan Non-Executive,Not Independent 4

Mr. Rajiv Dube Non-Executive,Not Independent 2

Mr. Raman Nanda Non-Executive,(upto 28th December, 2005) Not Independent 3

* No. of meetings held during 2005-06: Six


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Notes:-

a. Mr. Satish Pradhan was the Chairman of the Audit Committee upto 28th December,2005.

b. The meetings convened on 25th July, 2005, 21st October, 2005 and 23rd January, 2006were held as per the provisions of the Companies Act, 1956.

4. Remuneration Policy and Remuneration Committee

�� Sitting Fees to Directors:

The Board of Directors approved payment of Sitting Fee @ Rs. 10,000/- per meeting forattending the meeting of the Board and @ Rs. 5,000/- per meeting for attending the meetingof the Committees of the Board with effect from 1st January, 2006.

The details of Sitting Fee to the Non-Executive Directors for the year 2005-06 are as under:-

Sl. No. Name of the Director Sitting Fees (Rs.)

1. Mr. D. S. Gupta 20,000

2. Mr. R. A. Savoor 35,000

3. Mr. S. Ramakrishnan 15,000

4. Mr. Atul Bansal 5,000

5. Mr. Satish Pradhan 15,000

6. Mr. Rajiv Dube 5,000

7. Mr. Raman Nanda 20,000

8. Mr. B. Venkataramani 10,000

9. Mr. Shantanu Rudra 10,000

Total: 1,35,000

None of the Directors of the Company is in receipt of any kind of remuneration other than theSitting Fees. None of the Directors holds any equity shares or convertible instruments of theCompany in their capacity as an individual beneficiary.

�� Managerial Remuneration:

The Company has constituted Remuneration Committee to comply with the amendedprovisions of Schedule XIII to the Companies Act, 1956. The remuneration of a “Manager”appointed under section 269 of the Companies Act, 1956 needs to be approved by theRemuneration Committee.

The Remuneration Committee comprises six members, of whom three are independent.Mr. R. A. Savoor, Mr. S. Ramakrishnan, Mr. Satish Pradhan, Mr. Rajiv Dube, Mr. Atul Bansaland Mr. Raman Nanda are the members of the Committee.

The Terms of Reference of this Committee include determination of compensation payableto the Managerial Person including revision thereof, appraisal of his performance and thedetermination of his incentive remuneration.

Two circular resolutions were passed during 2005-06.


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Details of remuneration of the “Manager” for the year 2005-06 are given below:

Name Salary Payment of / Perquisites ContributionsProvision for and to FundsIncentive AllowancesRemuneration

Mr. Vilas Divadkar Rs.893 Rs.1,785 Rs.1,911 Rs.241(w. e. f. 4th April, 2005) thousand thousand thousand thousand

5. Shareholders / Investors Grievance Committee

The Shareholders / Investors Grievance Committee comprises of two non-executive Directors.The Chairman of the Committee is Mr. R. A. Savoor and Mr. Raman Nanda is the other member ofthe Committee. Mr. Rajiv Bakshi who was a member resigned from the Committee with effectfrom 21st October, 2005.

� Brief Terms of Reference

The functioning and terms of reference of the Committee are as prescribed and in duecompliance with the Listing Agreement with the Stock Exchanges and include reviewingexisting Investor Redressal System, redressing of shareholder complaints like delay intransfer of shares, non-receipt of balance sheet, non-receipt of declared dividend, etc. andsuggesting improvements in investor relations.

� Meetings and the attendance during the year

One meeting of the Shareholders / Investors Grievance Committee was held during the yearon 27th September, 2005 and was attended by Mr. Nanda and Mr. Bakshi.

Mr. Shailendra Dindore, Secretary is the Compliance Officer. The Company has not received anycomplaint from the shareholders during the year.

The Company’s shares are traded in the dematerialised form. To expedite transfers in physicalform, a Committee of Executives of the Company has been authorised to look into various matterslike share transfers/transmissions, issue of new certificates in split/consolidation, etc. TheCommittee comprises of the following executives:

Chief Executive Officer;Chief Financial Officer; andSecretary

Share transfers approved by the Committee are placed at the Board meeting from time to time.The Company attends to the investor correspondence promptly. There are no pending sharetransfers as on 31st March 2006.


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REPORT ON CORPORATE GOVERNANCE6. General Body Meetings

Details of the location of the last three Annual General Meetings (AGM), including the ExtraordinaryGeneral Meeting (EGM), and the details of the resolutions passed or to be passed by Postal Ballot

AGM for the Date & Time of AGM Venuefinancial year ended

2005 6th June, 2005 “Nehru Memorial Hall”,At 2.30 p.m. Atur Foundation House,

4, Dr. Ambedkar Road,Pune 411 001.

2004 23rd June, 2004 “Nehru Memorial Hall”,at 3.00 p.m. Atur Foundation House,


2003 30th June, 2003 “Nehru Memorial Hall”,at 3.00 p.m. Atur Foundation House,


The Shareholders passed all the resolutions including the special resolutions set out in the respectiveNotices. No Postal ballots were used for voting at these meetings. At the forthcoming AGM, thereis no item on the agenda that needs approval by postal ballot.

7. Disclosures

� Risk Management Framework

During 2005-06, the Board of Directors has adopted the Risk Assessment Procedure. Theprocedure provides an approach by the top Management to identify potential events thatmay affect the Company, to manage the risk within its risk appetite and to provide reasonableassurance regarding the achievement of objectives of the Company. The Senior Managementprioritises the risks and finalises the action plan for mitigation of the key risks. The actionplan is presented to the Board of Directors periodically.

� Related Party Transactions

During the year 2005 – 06, the Company has related party transactions as is envisagedunder the Corporate Governance Code which have been mentioned in Note 6 under Schedule16 of the Accounts. The basis of related party transactions is placed before the AuditCommittee.

� Management Disclosures

The Senior Management Personnel have been making disclosures to the Board relating toall material, financial and commercial transactions, where they have personal interest thatmay have a potential conflict with the interest of the Company at large. Based on thedisclosures received, none of the Senior Management Personnel has entered into any suchtransactions during the year.

� Statutory Compliance, Penalties and Strictures

There has not been any non compliance, penalties or strictures imposed on the Companyby the Stock Exchanges, SEBI or any other statutory authority, on any matter related tocapital markets, during the last year.

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8. Means of Communication

Quarterly & Half yearly Results, Newspaper in which published, Website, etc.

� The Quarterly, Half-Yearly and Annual Results are published in Financial Express and Loksattaas required under the Listing Agreement with the Stock Exchanges.

� The financial results are also put on the Company’s website www.autostampings.com andNational Informatics Centre’s (NIC) website www.sebiedifar.nic.in.

� Management Discussion and Analysis Report has been covered in the Directors’ Report.

9. General Shareholder Information

� AGM: Date, Time and Venue: 30th May, 2006 at 2.30 p.m. at “Nehru MemorialHall”, Atur Foundation House, 4, Dr. AmbedkarRoad, Pune 411 001.

� Profile of Directors being appointed and re-appointed:

The additional information required under Clause 49 (VI) (A) of the listing agreement in respectof Directors eligible for re-appointment is as under:

Profile of Directors being re-appointed:

Particulars

Age

Date of Appointment

Qualifications

Expertise in specificfunctional areas

Chairman / Director ofother Companies

Chairman / Member ofCommittees of theBoards of Companies ofwhich he is a Director

Mr. D. S. Gupta

56

7th July, 1997

B. E. (Mech. Eng.), P.G.D.B.A. (IIM - Ahmedabad)

Mr. Gupta is the Managing Director of TataAutoComp Systems Limited.

He has over 32 years of rich experience in theindustry.

Tata AutoComp Systems LimitedTata Johnson Controls Automotive LimitedTata Toyo Radiator LimitedTata Ficosa Automotive Systems LimitedTata Yazaki Autocomp LimitedTC Springs LimitedTata Nifco Fasteners LimitedTechnical Stampings Automotive LimitedAutomotive Composite Systems (International)LimitedTata Yutaka Autocomp LimitedTACO FAURECIA Design Center Private LimitedTACO MobiApps Telematics LimitedTACO Visteon Engineering Private LimitedTata Visteon Automotive Private LimitedTata AutoComp GY Batteries Private Limited

-

Mr. Satish Pradhan

51

8th May, 2002

M. A.

Mr. Pradhan is the Executive VicePresident - Group HumanResources of Tata Sons Limited.

He has over 27 years ofexperience in the field of HRactivities.

TAL Manufacturing SolutionsLimitedTata AutoComp Systems LimitedTata Services Limited

AuditTAL Manufacturing SolutionsLimited

As required under Clause 49 (VI) (A), particulars of Additional Directors seeking appointment aregiven in the Explanatory Statement to the Notice of the Annual General Meeting to be held on30th May, 2006.


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REPORT ON CORPORATE GOVERNANCE� Financial Calendar i) April to March

ii) First Quarter Results – third weekof July

iii) Half yearly Results – third weekof October

iv) Third Quarter Results – thirdweek of January

v) Results for the year ending31st March, 2007 - third week ofApril 2007

� Date of Book Closure 24th May, 2006 to 30th May, 2006 (Bothdays inclusive)

� Listing on Stock Exchanges Bombay Stock Exchange LimitedNational Stock Exchange of India Limited

The Company has paid listing fees for theperiod 1st April 2006 to 31st March, 2007.

� Stock Code - Physical 520119 on Bombay Stock Exchange Ltd.ASAL on The National Stock Exchange ofIndia Limited

Demat ISIN Number for NSDL & CDSL - INE900C01027

� High/Low of market price of the Company’s shares traded on The Bombay Stock Exchange,Mumbai during the year 2005 – 06 is furnished below:

Period High Low Period High Low(Rupees) (Rupees) (Rupees) (Rupees)

April 2005 89.90 70.70 October 2005 124.00 101.00May 2005 99.60 66.50 November 2005 126.25 111.00June 2005 115.00 85.00 December 2005 138.90 113.50July 2005 132.30 108.00 January 2006 146.80 117.25August 2005 117.85 105.00 February 2006 136.00 115.10September 2005 137.35 105.00 March 2006 139.00 102.00

� Stock Performance of the Company in comparison to BSE Sensex

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� Registrar and Transfer Agent The Company has appointedM/s MCS Limited as the Registrar and TransferAgent having their office at: First Floor, 116-118,Akshay Complex, Off Dhole Patil Road, NearGanesh Mandir, Pune 411 001Tel.No. (020) 30906685Fax No. (020) 26129597Email ID:[email protected]

� Share Transfer System All the transfers received are processed by theRegistrar and Transfer Agent and are approved bythe Committee of Executives of the Companyconstituted in this behalf. The Committee attendsto share transfer formalities once in a fortnight.Share transfers are registered and returned withinmaximum of 25 – 30 days from the date oflodgement, if documents are complete in allrespects.

� Distribution of Shareholding and shareholding pattern as on 31.03.2006.The distribution of shareholding as on 31.03.2006 is as follows:

Number of % to Share Holding of No. of Amount % toShareholders Total Nominal Value of Shares in Rs. Total

Rs.2,555 86.00 Upto 5,000 3,68,223 36,82,230 3.61

225 7.57 5,001 to 10,000 1,84,864 18,48,640 1.8180 2.69 10,001 to 20,000 1,24,285 12,42,850 1.2233 1.11 20,001 to 30,000 87,425 8,74,250 0.8618 0.61 30,001 to 40,000 66,781 6,67,810 0.6519 0.64 40,001 to 50,000 92,167 9,21,670 0.9017 0.57 50,001 to 1,00,000 1,31,257 13,12,570 1.2924 0.81 1,00,001 & above 91,43,539 9,14,35,390 89.66

2,971 100.00 Total 1,01,98,541 10,19,85,410 100.00

� Shareholding pattern as on 31.03.2006

Category No. of Shares Percentage ofshareholding

Promoters 82,96,280 81.35Mutual Funds 300 -Banks, Financial Institutions,Insurance Companies,Central/State Govt. Institutions, etc. 300 -Foreign Institutional Investors /Foreign Mutual Funds 5,59,769 5.49Private Corporate Bodies 3,37,844 3.32Indian Public 9,94,715 9.75Non Resident Indians 9,333 0.09

GRAND TOTAL 1,01,98,541 100.00

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REPORT ON CORPORATE GOVERNANCE� Dematerialisation of shares 99.05% equity shares of the Company have been

and liquidity dematerialised as on 31st March, 2006.

� Plant Locations The Company’s plants are located at Pune (Bhosari andChakan) in Maharashtra and Halol at Vadodara in Gujarat.

� Address for correspondence Shareholders correspondence should be addressed toour Registrars and Share Transfer Agents at the addressmentioned above.

Shareholders may also contact the Secretary of theCompany at the Registered Office of the Company forany assistance.

Tel. - (020) 27121677 / 27110870 / 27121500Fax – (020) 27123147Email ID: [email protected]

Shareholders holding shares in electronic mode shouldaddress all their correspondence to their respectiveDepository Participant.

10. Non-mandatory Requirements

� Half-yearly results for the half-year ended 30th September, 2005 were mailed to theshareholders in October, 2005.

� The Board of Directors has in its meeting held on 24th January, 2006 adopted the WhistleBlower Policy. The Policy encourages whistle blowing against unethical or improper activityby providing early and confidential access with further protection and without risk of reprisal.

11. Auditors’ Certificate on Corporate Governance

As required under clause 49 of the Listing Agreement, the Auditors’ Certificate on compliance ofthe Corporate Governance norms is attached.

12. Insider Trading Regulations

In terms of the SEBI (Prohibition of Insider Trading) Regulations, 1992, the Company has adoptedthe Tata Code of Conduct for Prevention of Insider Trading and Code of Corporate DisclosurePractices for its Directors, Officers and Specified Employees. The Chief Financial Officer of theCompany, Mr. P.G. Date is the Compliance Officer for these regulations. The Company also hasan Ethics and Compliance Committee primarily to set forth the policies relating to and overseeingthe implementation of the code. Mr. S. Ramakrishnan and Mr. Raman Nanda are the members ofthe said Committee.

DECLARATION

The Board of Directors of the Company has adopted the “Tata Code of Conduct” for the SeniorManagement of the Company and the “Code of Conduct for Non-Executive Directors” with effectfrom 1st January, 2006.All the Board Members and the Senior Management Personnel have affirmed their Compliancewith the respective Codes.

(Vilas Divadkar)Pune, April 13, 2006 Chief Executive Officer

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Auditors’ Certificate regarding compliance of conditions of Corporate Governance

To the Members of Automotive Stampings and Assemblies Limited

We have examined the compliance of conditions of Corporate Governance by Automotive Stampingsand Assemblies Limited, for the year ended March 31, 2006, as stipulated in Clause 49 of the ListingAgreements of the said Company with stock exchanges in India.

The compliance of conditions of Corporate Governance is the responsibility of the Company’sManagement. Our examination was carried out in accordance with the Guidance Note on Certification ofCorporate Governance (as stipulated in Clause 49 of the Listing Agreement), issued by the Institute ofChartered Accountants of India and was limited to procedures and implementation thereof, adopted bythe Company for ensuring the compliance of the conditions of Corporate Governance. It is neither anaudit nor an expression of opinion on the financial statements of the Company.

In our opinion and to the best of our information and according to the explanations given to us, we certifythat the Company has complied with the conditions of Corporate Governance as stipulated in the abovementioned Listing Agreements.

We state that such compliance is neither an assurance as to the future viability of the Company nor theefficiency or effectiveness with which the Management has conducted the affairs of the Company.

Partha GhoshPartner

Membership No. F 55913For and on behalf of

Place: Mumbai Price WaterhouseDate: April 19, 2006 Chartered Accountants

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AUDITORS' REPORTTo the Members of Automotive Stampings and Assemblies Limited

1. We have audited the attached Balance Sheet of Automotive Stampings and Assemblies Limited,as at March 31, 2006, and the related Profit and Loss Account and Cash Flow Statement for theyear ended on that date annexed thereto, which we have signed under reference to this report.These financial statements are the responsibility of the Company’s Management. Our responsibilityis to express an opinion on these financial statements based on our audit.

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

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

4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:

(a) We have obtained all the information and explanations, which to the best of our knowledgeand belief were necessary for the purposes of our audit;

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

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

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

(e) On the basis of written representations received from the directors, as on March 31, 2006and taken on record by the Board of Directors, none of the directors is disqualified as onMarch 31, 2006 from being appointed as a director in terms of clause (g) of sub-section (1)of Section 274 of the Act;

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

(i) in the case of the Balance Sheet, of the state of affairs of the Company as atMarch 31, 2006;

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

(iii) in the case of the Cash Flow Statement, of the cash flows for the year ended on thatdate.

Partha GhoshPartner



27

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AUDITORS' REPORTANNEXURE TO AUDITORS’ REPORT[Referred to in paragraph 3 of the Auditors’ Report of even date to the members of Automotive Stampingsand Assemblies Limited on the financial statements for the year ended March 31, 2006]

(i) (a) The Company is maintaining proper records showing full particulars includingquantitative details and situation of fixed assets.

(b) The fixed assets are physically verified by the Management according to a phasedprogramme designed to cover all the items over a period of three years, which inour opinion, is reasonable having regard to the size of the Company and thenature of its assets. Pursuant to the programme, a portion of the fixed assetshas been physically verified by the Management during the year and no materialdiscrepancies between the book records and the physical inventory have beennoticed.

(c) In our opinion, and according to the information and explanations given to us, asubstantial part of fixed assets has not been disposed of by the Company duringthe year.

(ii) (a) The inventory has been physically verified by the Management during the year. Inour opinion the frequency of verification is reasonable.

(b) In our opinion, the procedures of physical verification of inventory followed by theManagement are reasonable and adequate in relation to the size of the Companyand the nature of its business.

(c) On the basis of our examination of the inventory records, in our opinion, theCompany is maintaining proper records of inventory. The discrepancies noticedon physical verification of inventory as compared to book records were notmaterial.

(iii) (a) The Company has not granted any loans, secured or unsecured, to companies,firms or other parties covered in the register maintained under Section 301 ofthe Act.

(b) The Company has not taken any loans, secured or unsecured, from companies,firms or other parties covered in the register maintained under Section 301 ofthe Act.

(iv) In our opinion and according to the information and explanations given to us, havingregard to the explanation that certain items purchased are of special nature for whichsuitable alternative sources do not exist for obtaining comparative quotations, there isan adequate internal control system commensurate with the size of the Company andthe nature of its business for the purchase of inventory, fixed assets and for the sale ofgoods and services. Further, on the basis of our examination of the books and recordsof the Company, and according to the information and explanations given to us, wehave neither come across nor have been informed of any continuing failure to correctmajor weaknesses in the aforesaid internal control system.

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

(vi) The Company has not accepted any deposits from the public within the meaning ofSections 58A and 58AA of the Act and the rules framed thereunder.

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AUDITORS' REPORT(vii) In our opinion, the Company has an internal audit system commensurate with its size

and nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company in respectof products where, pursuant to the Rules made by the Central Government of India,the maintenance of cost records has been prescribed under clause (d) of sub-section(1) of Section 209 of the Act and are of the opinion that prima facie, the prescribedaccounts and records have been made and maintained. We have not, however, madea detailed examination of the records with a view to determine whether they are accurateor complete.

(ix) (a) According to the information and explanations given to us and the records of theCompany examined by us, in our opinion, the Company is generally regular indepositing the undisputed statutory dues including provident fund, investoreducation and protection fund, employees’ state insurance, income-tax,sales-tax, wealth tax, service tax, customs duty, excise duty, cess and othermaterial statutory dues as applicable with the appropriate authorities.

(b) According to the information and explanations given to us and the records of theCompany examined by us, the particulars of dues of excise duty (penalty) as atMarch 31, 2006, which have not been deposited on account of a dispute, are asfollows:-

Name of the Nature of the Amount Period to Forum wherestatute dues (Rs.) which the dispute

the amount is pendingrelates

Central Excise Penalty 15,000* 1998 to 2001 Customs, ExciseAct, 1944 and Service Tax

Appellate Tribunal

*Stay Application for dispensing with pre-deposition of penalty has been grantedby the Appellate Authorities.

(x) The Company has no accumulated losses as at March 31, 2006 and it has not incurredany cash losses in the financial year ended on that date or in the immediately precedingfinancial year.

(xi) According to the records of the Company examined by us and the information andexplanations given to us, the Company has not defaulted in repayment of dues to anyfinancial institution or bank or debenture holders as at the balance sheet date.

(xii) The Company has not granted any loans and advances on the basis of security byway of pledge of shares, debentures and other securities.

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

(xiv) In our opinion, the Company is not a dealer or trader in shares, securities, debenturesand other investments.

(xv) In our opinion, and according to the information and explanations given to us, theCompany has not given any guarantee for loans taken by others from banks or financialinstitutions during the year.

(xvi) In our opinion, and according to the information and explanations given to us, on anoverall basis, the term loans have been applied for the purposes for which they wereobtained.

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AUDITORS' REPORT(xvii) On the basis of an overall examination of the balance sheet of the Company, in our

opinion, and according to the information and explanations given to us, there are nofunds raised on a short-term basis which have been used for long-term investment.

(xviii) The Company has not made any preferential allotment of shares to parties andcompanies covered in the register maintained under Section 301 of the Act during theyear.

(xix) During the course of our examination of the books and records of the Company, carriedout in accordance with the generally accepted auditing practices in India, and accordingto the information and explanations given to us, we have neither come across anyinstance of fraud on or by the Company, noticed or reported during the year, nor havewe been informed of such case by the Management.

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

Partha GhoshPartner



30

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Schedule As at As at No. March 31, 2006 March 31, 2005

SOURCES OF FUNDSShareholders' fundsShare Capital 1

Equity Share Capital 101,985 101,985Preference Share Capital 120,000 120,000

Reserves and Surplus 2 241,745 225,672463,730 447,657

Loan FundsSecured Loans 3 185,000 200,000Unsecured Loans 4 180,121 174,376

365,121 374,376

Deferred Tax Liability (Net) 48,429 52,729(Refer Schedule 16, Note 8)

Total 877,280 874,762

APPLICATION OF FUNDSFixed Assets 5Gross Block 1,033,199 996,147Less: Depreciation 544,489 448,512Net Block 488,710 547,635Capital work-in-progress 149,655 108,375

638,365 656,010

Current Assets, Loans and AdvancesInventories 6 316,702 344,853Sundry Debtors 7 184,549 145,661Cash and Bank Balances 8 102,713 11,479Loans and Advances 9 85,520 98,980

689,484 600,973Less: Current Liabilities and Provisions 10

Current Liabilities 406,702 337,733Provisions 43,867 44,488

450,569 382,221

Net Current Assets 238,915 218,752

Total 877,280 874,762

Significant Accounting Policies 15Notes to Accounts 16

Schedules referred to above form an integral part of the Balance Sheet.This is the Balance Sheet referred to in our report of even date.

For and on behalf of the BoardPartha GhoshPartner R.A. SavoorMembership No. F 55913 Raman NandaFor and on behalf of B. VenkataramaniPRICE WATERHOUSE Shailendra Dindore DirectorsChartered Accountants SecretaryPlace : Mumbai Place : PuneDate : April 19, 2006 Date : April 19, 2006

BALANCE SHEET AS AT MARCH 31, 2006 (Rs. in '000)BALANCE SHEET

31

ASAL


Schedule For the year ended For the year endedNo. March 31, 2006 March 31, 2005

INCOMESales (Gross) 11 3,257,326 2,918,231Less : Excise Duty 489,359 419,388Sales (Net) 2,767,967 2,498,843Other Income 12 18,218 6,347

2,786,185 2,505,190EXPENDITURE

Manufacturing and Other Expenses 13 2,597,491 2,334,961

Profit before Interest, Depreciation andTaxation 188,694 170,229

Less :Interest and Finance Charges 14 19,570 13,927Depreciation 5 98,277 91,114

117,847 105,041

Profit Before Taxation 70,847 65,188

Provision for TaxationCurrent Tax (including wealth tax) 28,100 5,199Deferred Tax Expense / (Credit) (4,300) 19,814Fringe Benefit Tax 1,250 -Excess Provision for Taxation in respect ofearlier years written back (650) -

Profit After Taxation 46,447 40,175

Balance brought forward from previous year 22,813 17,012

Balance available for appropriation 69,260 57,187

APPROPRIATIONSGeneral Reserve 4,500 4,000Proposed Dividend :

On Preference Shares 14,400 14,400On Equity Shares 12,238 12,238

Tax on Dividend 3,736 3,736Balance carried forward to the Balance Sheet 34,386 22,813

69,260 57,187

Basic / Diluted Earnings per share 2.94 2.33(Refer Schedule 16, Note 7)

Significant Accounting Policies 15Notes to Accounts 16

Schedules referred to above form an integral part of the Profit and Loss Account.This is the Profit and Loss Account referred to in our report of even date.


PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31, 2006 (Rs. in '000)PROFIT AND LOSS ACCOUNT

32

ASAL


Schedules forming part of the Accounts for the year ended March 31, 2006 (Rs. in '000)

As at As atMarch 31, 2006 March 31, 2005

1 SHARE CAPITAL

Authorised :10,800,000 Equity Shares of Rs.10 each 108,000 108,000

16,000,000 Preference Shares of Rs. 10 each 160,000 160,000268,000 268,000

Issued, Subscribed and Paid-up :

10,198,541 Equity Shares of Rs. 10 each fully paid-up 101,985 101,985(Refer Note 1 below)

12,000,000 12% Cumulative Redeemable Preference 120,000 120,000Shares of Rs. 10 each fully paid up (Refer Note 2 below)(Redeemable at the expiry of 5 years from thedate of allotment [i.e. 27th September 2002], with an optionto the Company to redeem before maturity.)

221,985 221,985Notes :

1 8,296,180 equity shares are held by Tata AutoCompSystems Limited, the Holding Company.

2 All the Preference shares are held by the Holding Company.

2 RESERVES AND SURPLUS

Share PremiumAs per last Balance Sheet 194,859 194,859

General ReserveAs per last Balance Sheet 8,000 4,000Add: Additions during the year 4,500 4,000

12,500 8,000

Profit and Loss Account 34,386 22,813241,745 225,672

3 SECURED LOANS

Term Loan from Banks (Refer Note 1 below) 185,000 175,000(Payable within one year Rs. 100,000 thousand,Previous year Rs. 40,000 thousand)

Working Capital Loans from Banks - 25,000(Refer Note 2 below)

185,000 200,000

Notes :1. Term loan is secured by way of first charge on the

fixed assets of Chakan Plant of the Company.

2. Working capital loans are secured by hypothecationof current assets and second charge on the fixedassets of Chakan Plant of the Company.

4 UNSECURED LOANSInterest Free Sales Tax Loan 180,121 174,376(Payable within one year Rs. 3,614 thousand,Previous year Rs. Nil) 180,121 174,376

SCHEDULES

33

ASAL


SCHEDULES

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34

ASAL


Schedules forming part of the Accounts for the year ended March 31, 2006 ... (Contd.) (Rs. in '000)


6 INVENTORIES(Refer Schedule 15, Note 4)

Stores and Spares 11,209 5,863

Raw Material and Components 234,384 202,943

Work-in-Process 33,570 111,982

Finished Goods 30,904 5,757(including goods-in-transit at cost)

Scrap 6,635 18,308

316,702 344,8537 SUNDRY DEBTORS

Unsecured

Over six months :Considered good 2,693 3,616Considered doubtful 10,740 7,833

Others :Considered good 181,856 142,045Considered doubtful 710 944

195,999 154,438

Less : Provision for doubtful debts 11,450 8,777

184,549 145,661

8 CASH AND BANK BALANCES

Cash on Hand 77 126

Balances with Scheduled Banks :On Current Accounts 47,791 9,413On Dividend Accounts 42 29On Deposit Accounts* 54,803 1,911

102,713 11,479* includes Deposit of Rs. 803 thousand,(Previous year Rs. 1,911 thousand) under Bank's lien.

9 LOANS AND ADVANCES(Unsecured - considered good)

Advances recoverable in cash orin kind or for value to be received 59,727 65,413

Bills of Exchange 1,318 13,738

Balance with Excise Authorities 19,241 16,052

Advance Tax including Tax deducted at source(Net of provision for tax Rs. 28,096 thousand, 5,234 3,777[Previous year Rs. 5,112 thousand])

85,520 98,980

SCHEDULES

35

ASAL


Schedules forming part of the Accounts for the year ended March 31, 2006 ... (Contd.) (Rs. in '000)


10 CURRENT LIABILITIES AND PROVISIONS

CURRENT LIABILITIESSundry Creditors

Due to Small Scale Industrial Undertakings(Refer Schedule 16, Note 3) 1,351 23,530Due to creditors other than Small Scale IndustrialUndertakings 221,558 249,996

Advances from customers 7,304 2,526

Unclaimed Dividend* 42 29

Other Liabilities 175,665 61,624

Interest accrued but not due 782 28

406,702 337,733* There are no amounts due and outstanding to be

credited to Investor Education and Protection Fund.

PROVISIONSProvision for Gratuity 4,344 8,564

Provision for Leave Encashment 9,149 5,550

Proposed Dividend on Preference Shares 14,400 14,400

Proposed Dividend on Equity Shares 12,238 12,238

Provision for Tax on Dividend 3,736 3,736

43,867 44,488450,569 382,221

SCHEDULES

36

ASAL


Schedules forming part of the Accounts for the year ended March 31, 2006 ... (Contd.)(Rs. in '000)

For the year ended For the year endedMarch 31, 2006 March 31, 2005

11 SALES

Turnover of goods and job work 2,762,757 2,457,800(Refer Schedule 15, Note 5)

Sale of scrap 494,569 460,431

3,257,326 2,918,231

12 OTHER INCOME

Interest received on Bank Deposits and Other 1,213 159Deposits (Tax Deducted at sourceRs. 131 thousand, [Previous year Rs. 17 thousand])Profit on Sale of Investments (non-trade) 2,496 1,892

Dividend on Non-trade Investments 884 -

Cash Discount 554 368

Gain on Exchange Fluctuations (net) 65 -

Miscellaneous Receipts 4,999 3,928Provision no longer required written back 8,007 -

18,218 6,34713 MANUFACTURING AND OTHER EXPENSES

(i) Raw Material Consumed 1,967,838 1,844,586(ii) Decrease / (Increase) in Stocks

Opening StockWork in process 111,982 60,535Finished goods 5,757 1,382Scrap 18,308 20,667

136,047 82,584Less : Closing StockWork in process 33,570 111,982Finished goods 30,904 5,757Scrap 6,635 18,308

71,109 136,047Decrease / (Increase) in Stock 64,938 (53,463)

(iii) Consumables and Stores 51,599 47,882(iv) Processing Charges 100,297 115,401(v) Power and Fuel 53,634 46,529(vi) Repairs and Maintenance

- Plant and Machinery 36,185 35,137- Building 1,933 7,794- Others 3,352 7,627

41,470 50,558(vii) Payments to and Provisions for Employees

Salaries and Wages 145,503 128,072Contribution to Providentand other funds 10,383 6,674Staff Welfare 9,496 8,447

Carried forward 2,445,158 2,194,686

SCHEDULES

37

ASAL


SCHEDULESSchedules forming part of the Accounts for the year ended March 31, 2006 ... (Contd.)

(Rs. in '000)For the year ended For the year ended

March 31, 2006 March 31, 2005

13 MANUFACTURING AND OTHER EXPENSES (Contd.)Brought forward 2,445,158 2,194,686

(viii) Expenses for Administration and SellingTravelling and Conveyance 7,117 7,130Communication Expenses 3,162 3,432Rates and Taxes 4,646 1,296Insurance 4,051 2,793Auditors' Remuneration- Audit fee 550 550- Tax Audit fee 130 130- Others 275 275- Out of pocket expenses 36 30

991 985Administrative Service Charges 69,881 67,741Loss on Exchange Fluctuations (net) - 466Advertisement and Publicity 98 372Provision for Doubtful Debts 2,673 1,660Loss on sale/write off of Assets (net) 189 319Packing Material 6,792 12,509Warranty Expenses 603 530Freight Outward 32,305 30,712Miscellaneous Expenses 19,825 10,330

2,597,491 2,334,961

14 INTEREST AND FINANCE CHARGES

Interest- On Term Loans 14,562 6,497- Others 2,662 3,560

Bank charges 2,346 3,870

19,570 13,927

38

ASAL


SCHEDULESSchedules forming part of the Accounts for the year ended March 31, 2006... (Contd.)

15 SIGNIFICANT ACCOUNTING POLICIES1. BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The Financial Statements are prepared under the historical cost convention on accrual basisin accordance with the generally accepted accounting principles and Accounting Standardsreferred to in Section 211 (3C) of the Companies Act, 1956, of India.

2. FIXED ASSETS AND DEPRECIATION

Fixed assets are stated at cost of acquisition or construction less accumulated depreciation.All costs relating to the acquisition and installation of fixed assets are capitalized and includeborrowing costs directly attributable to construction or acquisition of fixed assets, upto thedate the asset is put to use.

Depreciation on fixed assets has been provided as under:

a) Depreciation on fixed assets is provided on straight line method at the rates and inthe manner prescribed in Schedule XIV to the Companies Act, 1956, of India exceptin case of the following assets for which depreciation has been provided at higherrates based on the useful life as determined by the Management:

Furniture & Fixtures and Office Equipment (including white goods) 20%Computers 25%Tools, Jigs & Fixtures 20%Vehicles 20%Pallets 12.5%

b) Leasehold land is amortized over the period of lease.

c) Except for items for which 100% depreciation rates are applicable, depreciation onassets added / disposed of during the year has been provided on pro rata basiswith reference to the month of addition / disposal.

d) Depreciation on incremental cost arising on account of translation of foreigncurrency liabilities for acquisition of fixed assets has been provided as aforesaidover the residual life of the respective assets.

e) Intangible assets are stated at cost less accumulated amortization. Intangible assetsare amortized on a straight line basis over their estimated useful life ranging between3 to 5 years.

f) The Management periodically assesses using external and internal sources whetherthere is an indication that an asset may be impaired. If an asset is impaired, theCompany recognizes an impairment loss as the excess of the carrying amount ofthe asset over the recoverable amount.

3. INVESTMENTS

Current Investments are stated at Cost or Market value whichever is lower.

39

ASAL


Schedules forming part of the Accounts for the year ended March 31, 2006... (Contd.)

15 SIGNIFICANT ACCOUNTING POLICIES4. INVENTORIES

(a) Raw materials, components, stores and spares are valued at cost or net realizablevalue, whichever is lower. Cost is determined using the weighted average basis.

(b) Finished goods and work-in-process are valued at cost or net realizable value,whichever is lower. Finished goods and work-in-process includes cost of conversionincurred in bringing the inventories to its present location and condition.

(c) Scrap is valued at net realizable value.

5. REVENUE RECOGNITION

Sales are recognized on supply of goods to customers and are recorded gross of exciseduty and net of sales tax and discounts.

6. FOREIGN CURRENCY TRANSACTIONS

Transactions in foreign currencies are recorded at the exchange rate prevailing on thedate of the transaction. Foreign currency Assets and Liabilities are stated at the exchangerates prevailing at the date of the Balance Sheet and at forward contract rates whereverso covered. Exchange differences relating to liabilities incurred towards purchase ofFixed Assets are adjusted to the cost of Fixed Assets. Any other exchange difference isdealt with, in the Profit and Loss Account.

7. BORROWING COSTS

Borrowing costs that are attributable to the acquisition or construction of qualifying assetsare capitalized as part of the cost of such assets upto the date the asset is put to use. Aqualifying asset is one that necessarily takes substantial period of time to get ready forintended use. All other borrowing costs are charged to Profit and Loss Account in theyear in which they are incurred.

8. RETIREMENT BENEFITS

(a) Liability for gratuity and leave encashment is provided on the basis of actuarialvaluation done at the end of the year.

(b) Contributions to Provident Fund and Superannuation Scheme are accounted foron accrual basis.

9. TAXATION

(i) Provision for current tax is made in accordance with and at the rates specified underthe Income-tax Act, 1961, as amended.

(ii) In accordance with Accounting Standard 22 – ‘Accounting for taxes on Income’, issuedby the Institute of Chartered Accountants of India, the deferred tax for timing differencesbetween the book and tax profits for the year is accounted for using the tax rates andlaws that have been enacted or substantively enacted as of the balance sheet date.

Deferred tax assets arising from the timing differences are recognized to the extentthere is virtual certainty that the assets can be realized in future.

10. WARRANTY EXPENSES

Product warranty expenses are determined based on past experience and estimates andare accrued in the year of sale.

SCHEDULES

40

ASAL


1. Contingent liabilities:(Rs. in '000)

Sr.No. Particulars As at 31.03.2006 As at 31.03.2005

1. Bills discounted 671,911 546,289

2. Claims against the Company notacknowledged as Debts 2,385 1,533

3. Letters of Credit Outstanding 21,666 37,804

4. Bank Guarantees given in favour ofGovernment Authorities/ third parties 701 4,220

2. Estimated amount of contracts remaining to be executed on capital account and not providedfor (net of advances) Rs. 53,420 thousand (Previous year Rs. 78,080 thousand).

3. Information regarding Small Scale Industrial Undertakings has been determined to the extentsuch parties have been identified on the basis of the information available with the Company.This has been relied upon by the auditors.

The names of Small Scale Industrial Undertakings to whom the Company owes a sum,which is outstanding for more than 30 days as at March 31, 2006, are:

Bhushan Engineers Prashant EngineeringBright Metals and Foods R.P. EngineeringGrace Engineering Company Suraj Auto PartsGenuine Engineering M/s Swapnil IndustriesHarshal Pressing Pvt. Ltd. S.V. IndustriesHarshad Engineers Suchi EnterprisesNew Swan Enterprises Sunil Enterprises

Savera Auto Components Pvt. Ltd.

4. Manager’s Remuneration:(Rs. in '000)

Year ended March Year ended March31, 2006 31, 2005

Salary 893 624Perquisites and allowances 1,911 863Contribution to provident and other funds 241 183Payment of / Provision for incentiveremuneration 1,785 1,248Other retirement benefits - 61

Total: 4,830 2,979

Notes:a) This remuneration does not include gratuity provided on the basis of actuarial valuation

in the accounts.b) Approval of the Central Government has been obtained for the remuneration of the

Manager for the year 2005-06.


16 NOTES TO ACCOUNTS

SCHEDULES

41

ASAL


5. Details of Investments Purchased and Sold during the year (face value per unit Rs.10):

(Rs. in'000)Investment Year ended Year ended

March 31,2006 March 31,2005

Units Purchase Sales Units Purchase SalesCost Value Cost Value

GrindlaysFloating RateFund (Growth) - - - 20,858,163 221,583 221,840

Grindlays FloatingRate Fund -InstitutionalPlan B (Growth) 3,238,344 35,500 35,569 72,304,002 771,668 772,833

DSP Merrill LynchFloating RateFund (Growth) 37,790,907 421,000 422,384 18,796,210 203,118 203,588

DSP Merrill LynchFloating Rate -Institutional Plan(Growth) 374,360 377,081 378,085 - - -

DSP Merrill LynchLiquidity Fund -Institutional Plan(Growth) 53,849 54,419 54,451 - - -

DSP Merrill LynchFloating Rate Fund -Institutional Plan(Daily Dividend) 67,372 67,378 67,385 - - -

DSP Merill LynchLiquidity Fund -Institutional Plan(Daily Dividend) 104,906 104,927 104,927 - - -

Standard CharteredLiquidity Manager(Daily Dividend) 5,869,622 33,196 33,196 - - -



SCHEDULES

42

ASAL


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43

ASAL




7. Earnings Per Share (EPS)

Year ended Year endedParticulars March 31, 2006 March 31, 2005

a) Profit after taxation as perProfit and Loss Account (Rs. in '000) 46,447 40,175

Less :Preference Dividend for the yearincluding tax thereon (Rs. in '000) 16,420 16,420

Net Profit after tax available to Equity 30,027 23,755Shareholders (Rs. in '000)

b) Weighted average number of Equity Sharesoutstanding during the year 10,198,541 10,198,541

c) Nominal value of Equity Shares (Rs.) 10 10

d) Basic Earnings per Share (Rs.) (a/b) 2.94 2.33

8. The Company estimates the deferred tax charge/(credit) using the applicable rate of taxationbased on the impact of timing differences between financial statements and estimated taxableincome for the current year. Details of Deferred Tax Assets/(Liabilities) are as follows:

(Rs. in '000)

Particulars As at March 31, As at March 31,2006 2005

AssetsUnabsorbed Depreciation - 7,746Receivables 3,854 2,955Retirement Benefits 7,146 4,730Others 2,154 4,737

Total 13,154 20,168

Liability Depreciation 61,583 72,897

Total 61,583 72,897

Net Deferred Tax Assets/(Liabilities) (48,429) (52,729)

Deferred tax assets are recognized for tax loss carried forward to the extent that the realizationof the related tax benefit through the future taxable profits is probable, based on managementestimates.

SCHEDULES

44

ASAL




9. Estimated warranty costs are accrued at the time of sale of components to which the warrantyprovisions are applicable. The details of warranty provision are as follows:

Particulars As at March 31, As at March 31,2006 2005

Beginning Balance 364 350Provision made during the year 603 530Payments made during the year 603 516Amount reversed during the year - -Ending Balance 364 364

It is expected that the majority of the warranty provision outstanding as on 31st March 2006 is likely to result incash outflow within 3 years of the Balance Sheet date.

10. Additional information pursuant to the provisions of para 3 and 4 of Part II of Schedule VI of the CompaniesAct, 1956 is as under:

A. INSTALLED CAPACITY AND PRODUCTION:*

Product Installed Production Stock of goods producedCapacity @ (Nos.)

Opening Stock Closing Stock

Qty. Value Qty. Value(Rs. in '000) (Rs. in '000)

Components,Assemblies and 47,200 MT 16,117,669 65,633 5,757 172,051 30,904Sub-assemblies

Previous year (47,200 MT) (13,845,126) (47,420) (1,382) (65,633) (5,757)

Tools, Dies andMoulds N.A. 254 - - - -

Previous year (N.A.) (37) (-) (-) (-) (-)

* As certified by the Management and accepted by the auditors, this being a technical matter.@ Information on Licensed capacity has not been given since Licensing has been abolished.

B. SALES

Product For the year ended For the year endedMarch 31, 2006 March 31, 2005


Components, Assembliesand Sub-assemblies 16,011,251 2,672,720 13,826,913 2,421,402

Job work 77,271 - 29,629

Tools, Dies and Moulds 254 12,766 37 6,769

Others 494,569 - 460,431

Total 3,257,326 2,918,231

SCHEDULES

(Rs. in '000)

45

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Schedules forming part of the Accounts for the year ended March 31, 2006 ... (Contd.)


C. CONSUMPTION OF RAW MATERIALS

Particulars For the year ended For the year endedMarch 31, 2006 March 31, 2005


1 Component (Nos.) 39,458,049 199,247 37,368,959 323,641

2 MS Sheets (MT) 53,009 1,746,629 44,253 1,474,418

3 Others - 21,962 - 46,527

Total 1,967,838 1,844,586

D. CIF VALUE OF IMPORTS(Rs. in '000)


Raw Material 61,645 58,354Spares 157 -

Total 61,802 58,354

E. VALUE OF IMPORTED AND INDIGENOUS RAW MATERIAL,COMPONENTS AND SPARES CONSUMED


Value (Rs. in '000) % Value (Rs. in '000) %a) Raw Material and

Componentsi) Imported 73,898 3.75 54,227 2.94

ii) Indigenous 1,893,940 96.25 1,790,359 97.06

1,967,838 100.00 1,844,586 100.00

b) Consumables and Storesi) Imported - - - -ii) Indigenous 51,599 100.00 47,882 100.00

51,599 100.00 47,882 100.00

F. EXPENDITURE INCURRED IN FOREIGN CURRENCY(Rs. in '000)


Travelling 280 1,019

Interest - 1,156

Total 280 2,175

G. EARNINGS IN FOREIGN CURRENCY(Rs. in '000)


F.O.B. value of Export of Goods 25,859 36,541

SCHEDULES

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Schedules forming part of the Accounts for the year ended March 31, 2006 ... (Contd.)

11. Additional information pursuant to Part IV of Schedule VI of the Companies Act, 1956, is set out in theAnnexure.

12. Previous year's figures have been regrouped / rearranged, wherever necessary.

Signatures to Schedules 1 to 16 forming part of the Accounts.As per our Report of even date.


SCHEDULES

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Cash Flow Statement:

(Rs. in '000)


A. CASH FLOW FROM OPERATING ACTIVITIES :

Net profit before taxation 70,847 65,188

Adjusted for :

Depreciation 98,277 91,114

Interest and financial charges 19,570 13,927

Interest income (1,213) (159)

Profit on sale of investments (2,496) (1,892)

Dividend on Non-trade Investments (884) -

Loss on sale / write off of assets 189 113,443 319 103,309Operating Profit before WorkingCapital Changes 184,290 168,497

Adjustment for :

Trade and other receivables (25,429) (101,454)

Inventories 28,151 (135,243)

Trade payables and other liabilities 67,595 70,317 116,842 (119,855)

Cash Generated From Operations 254,607 48,642

Direct taxes paid (28,700) (5,199)

NET CASH FROM OPERATING ACTIVITIES (A) 225,907 43,443

B. CASH FLOW FROM INVESTING ACTIVITIES:

Purchase of fixed assets (81,691) (211,336)

Proceeds from sale of fixed assets 870 558

Dividend on Non-trade Investments 884 -

Profit on sale of Investments 2,496 1,892

Interest received 1,213 159

NET CASH USED IN INVESTING ACTIVITIES (B) (76,228) (208,727)

CASH FLOW STATEMENT

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Cash Flow Statement (Contd.)

(Rs. in '000)


C. CASH FLOW FROM FINANCING ACTIVITIES:

Interest paid (18,816) (13,919)

Long Term loans availed / (paid) (Net) 10,000 175,000

Sales tax deferral availed / (paid) (Net) 5,745 89,026

Other borrowings (25,000) (54,521)

Equity and Preference Dividend paid (30,374) (24,523)(including tax thereon)

NET CASH FLOW FROM FINANCING ACTIVITIES (C) (58,445) 171,063

Net increase / (decrease)in Cash and Cash equivalents (A) + (B) + (C) 91,234 (5,779)

Cash and cash equivalents (Opening Balance) 11,479 5,700

Cash and cash equivalents (Closing Balance) 102,713 11,479

Notes :

1 The above Cash Flow Statement has been prepared under the “ Indirect Method “set out in AccountingStandard (AS) - 3 on Cash Flow Statement issued by the Institute of Chartered Accountants of India.

2 Cash and cash equivalents consist of cash in hand and balance with banks.

3 Trade and other receivables include loans and advances.

4 Previous year comparitives have been reclassified to conform with current year’s presentation, where applicable.

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


CASH FLOW STATEMENT

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AUTOMOTIVE STAMPINGS AND ASSEMBLIES LIMITEDRegistered Office : G-71/2, MIDC Industrial Area

Bhosari, Pune 411 026, Maharashtra

PROXY FORMDPIP / CLID* : No. of Shares :Regd. Folio :

I/We ..……………………………………………..................……........………………..........................……...…...of

…………………………………………………………………………….……….....…………………....................................

……………………………………………………………...........................…............. being member / members of

AUTOMOTIVE STAMPINGS AND ASSEMBLIES LIMITED, hereby appoint..........………................................of

...................................................................................................................................................................

.............................................................................................. or failing him .........................................…of

……….....………………………...…………......................................................................................................

as my / our proxy to attend and vote for me / us on my / our behalf at the 16th Annual General Meeting of theCompany to be held on Tuesday, the 30th day of May, 2006 at "Nehru Memorial Hall", Atur Foundation House, 4,

Dr. Ambedkar Road, Pune 411 001 at 2.30 P.M. and at any adjournment thereof.

Signed this ……………………………..........… day of …………………………….............…………………. 2006.

*Applicable for Members holding shares in Dematerialised form.

_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _

AUTOMOTIVE STAMPINGS AND ASSEMBLIES LIMITEDRegistered Office : G-71/2, MIDC Industrial Area

Bhosari, Pune 411 026, Maharashtra

ATTENDANCE SLIP

NAME OF MEMBER/PROXY* DPID/CLID** FOLIO NO. NO OFSHARESHELD

I hereby record my presence at the 16 th Annual General Meeting of the Company held on Tuesday, the 30th day of

May, 2006, at "Nehru Memorial Hall", Atur Foundation House, 4, Dr. Ambedkar Road, Pune 411 001 at 2.30 P.M.

Signature of the Member / Proxy*...........................………………………………………..........................

*Strike out whichever is not applicable.

**Applicable for Members holding shares in Dematerialised form.

Note :1. Members/Proxies are requested to bring the duly filled in Attendance Slip to the Annual General Meeting, to

be handed over at the meeting.

2. If you intend to appoint a proxy, please deposit duly filled Proxy Form at Company's Registered Office atleast 48 hours before the meeting i.e. upto 2.30 P.M. on 28th May, 2006.�

RevenueStamp of

Re. 1/-Signature

(Write full address)



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2005-06 ANNUAL REPORTTitle: 2005-06 ANNUAL REPORT.pdf Created Date: 5/8/2006 8:12:56 AM

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Transcript of 2005-06 ANNUAL REPORTTitle: 2005-06 ANNUAL REPORT.pdf Created Date: 5/8/2006 8:12:56 AM