Harig Crankshafts Ltd Management Discussions.

HARIG CRANKSHAFTS LIMITED ANNUAL REPORT 2008-2009 MANAGEMENT DISCUSSION AND ANALYSIS OPERATING PERFORMANCE: (Rs. In Lacs) 2008-09 2007-08 Total Income 2011.84 4247.85 Operating Profit 208.68 661.30 Less: Interest 297.36 248.10 Cash Accruals -88.68 413.20 Less: Depreciation 308.09 307.66 Profit/Loss before Tax -396.77 105.54 Provision for Taxation (including FBT) 3.32 13.84 Profit/Loss after Tax -400.09 91.70 During the year under review, the auto industry witnessed turbulent times, which affected the performance of automobile majors, and cheaper import of crankshafts from China. Your Company also suffered on account of decline in demand due to these factors. The Government of India also imposed dumping duty on cheap crankshafts import. The Government of India announced stimulus packages for revival of the industry and the demand for vehicles and auto components is reviving. FUTURE OUTLOOK AND PROSPECTS With the announcement of stimulus packages by the Government of India the automobile industry is showing signs of revival and outlook for the next couple of years remains positive. The new crankshafts machining line is likely to commence commercial production by January 2010, and shall improve the profitability of the Company. However, the availability and price of steel are the major cause of concern for the industry.