Triton Valves Ltd

Your Directors have pleasure in presenting the Thirtyfifth Annual Report together withthe Audited Accounts for the year ended 31st March 2011.

3. Dividend

Your Directors are pleased to recommend a dividend of Rs. 107- per Equity Share (100%)for the financial year ended 31st March 2011.

4. Performance

The Company's sales turnover net of excise duty and discount increased to Rs. 124.70crore as against Rs. 91.33 crore in the previous year, an increase of 36.5%. The Companywasable to broaden its customer base by adding several new key customer accounts. TheCompany's market share also grew significantly in all segments. Profit before taxincreased from Rs.709.19 lakhs to Rs.889.83 lakhs.

5. Prospects for the Financial Year 2011-2012

The Company expects strong growth during the Financial Year 2011-2012. This expectationarises from the forecasts of the automobile and tyre industries. The tyre industry inparticular is seeing additional capacities going on stream during the year in allsegments. The Company is confident of taking advantage of this market expansion and offurther strengthening its position in the domestic market.

6. Capacity Expansion

The capacity expansion which commenced at the start of the year has progressed well.The Company has already invested approximately Rs. 20 crore during the year and thetargetted capacities have been achieved in most product segments. More than 85% of the newequipment hasbeen received. The capacity expansion is expected to be completed in allrespects by during this fiscal. This would increase the manufacturing capacity of valvesto 150 million and valve cores to approximately 190 million per annum.

7. Directors

Mr. M.R.Hosangady and Dr. B.R. Pai retire by rotation at the Annual General Meeting andbeing eligible have offered themselves for re-appointment.

The Board deeply regrets the passing away of Mr. N.S.S. Murthy, Chairman on 27thOctober 2010 and places on record its appreciation of the valuable services rendered byhim during his tenure as a Founder Director and Chairman.

8. Auditors

The Statutory Auditors of the Company, M/s Brahmayya & Co., Bangalore, retire atthe conclusion of this Annual General Meeting and are eligible for re-appointment.

9. Employee Relations

Employee Relations continued to be cordial during the year.

10. Particulars of Employees under Section 217(2A)

Information as per Section 217(2A) of the Companies Act, 1956, read with Companies(Particulars of employees) Rules, 1975, is forming part of the Annexure to this report.

11. Conservation of Energy, Technology Absorption, Exports and Foreign Earnings &Outgo

Information required to be furnished pursuant to Section 217(1)(e) of the Companies Act1956 read with Companies (Disclosure of Particulars in the Report of Directors) Rules1988is set out in the Annexure to this report.

12. Listing with Stock Exchanges

As per the requirement of Clause 49 of the Listing Agreement with Stock Exchanges, theCompany hereby declares that the listing of its shares continued throughout the year withthe Stock Exchange Mumbai, Phiroze Jeejeebhoy Towers, Dalai Street, Mumbai-400001 and thatthe Company has paid the listing fees up to date.

13. Directors' Responsibility Statement as required under Section 217(2AA) of theCompanies'Act 1956

Your Directors, on the basis of information made available to them by the Managementand the Auditors wish to place on record:

(i) That in the preparation of the Annual Accounts, the applicable Accounting Standardshave been followed along with proper explanation relating to material departures.

(ii) That the Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the Profit or Loss of the Company for that period.

(iii) That the Directors have taken proper andsufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities.

(iv) That the Annual Accounts have been prepared on a going concern basis

14. Secretarial Compliance Certificate

The Compliance Certificate obtained from a Company Secretary in whole time practice inaccordance with Section 383(A) of the Companies Act 1956 and the rules made thereunder isannexed to this report.

15. Acknowledgements

Your Directors thank the customers and vendors for their continued support to yourCompany's growth. Your Directors place on record their appreciation of the support givenby HDFC Bank, Standard Chartered Bank, Citibank and Kotak Mahindra Bank for meeting thelong term and working capital needs of the Company.

Your Directors are grateful to the State Government for their continued support to theCompany's activities.

Your Directors are thankful to the esteemed shareholders for their support andencouragement. They also wish to place on record their appreciation of the contributionmade by employees at all levels.

ANNEXURE TO DIRECTORS' REPORT

Particulars pursuant to Companies (Disclosure of particulars in the report of Board ofDirectors) Rules 1988

1. A. CONSERVATION OF ENERGY

I . Power factor of power supplied from Karnataka Power Transmission CorporationLimited (KPTCL) is monitored and maintained at 0.95.

II. Automatic switches were introduced on some machines to avoid idle running.

III. A.C. variable drives were introduced on one machine during the year to saveenergy.

B. TECHNOLOGY ABSORPTION

I More productive machines were introduced in specific areas.

II. New products were developed to meet customer specific requirements.

BENEFITS

I . The Company's Product range has been widened

I I Productivity has improved

FUTURE PLAN OF ACTION

I . To introduce automation in more areas

II. To develop more materials efficient processes

III. Introduction of A.C. variable drives in more areas.

Expenditure on Research & Development

C. Foreign Exchange Earnings and Outgo

Statement of Particulars of Employees pursuant to the provisions of Section 217(2A) ofthe Companies Act, 1956. Employed for full year: