WABCO India Ltd Management Discussions.

The Company is a leading supplier of technologies and services that improve safety, efficiency and connectivity of commercial vehicles in India. Powered by its vision for accident-free driving and greener transportation solutions, the company excels in pioneering breakthrough innovations that bring industry-leading solutions to the commercial vehicle industry in India and worldwide.

The commercial vehicle industry is undergoing fast paced changes paving way for technologically advanced smart vehicles. Anticipating this, the Companys focus has been on three key domains of innovation namely Autonomous Connected & Electric (ACE) technologies for commercial vehicles.

India is recognized as the fastest growing economy in the world. Driven by the underlying economic growth, increasing consumption demand, mass urbanization, focus on strengthening infrastructure, investment in renewable energy alternatives etc., India is poised to become the third largest consumer economy by 2025.

I. Industry Structure and Development:

i. GDP growth and Indian economic outlook:

The Reserve Bank of India (RBI) in their Bi-monthly monetary policy has projected a GDP growth of 7.2% in 2019-20 compared to 6.8% in 2018-19.

2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 e
GDP Growth in % 7.2 7.6 7.1 6.6 6.8 7.2

India is recognized as the fastest growing economy in the world, despite the strong headwinds during the last fiscal caused by a liquidity crisis because of an NBFC failure.

The continuing effects of the headwinds of second half of 2018-19 may result in a subdued Q1 for FY 2019-20, with an anticipated pick up during the second quarter. This acceleration is expected to come from low oil prices and easing up of infrastructure roadblocks. The possible down sides to 2019-20 may result from uncertain oil prices, and drop in global economic activity which may affect Indias exports. Indias focus in the coming year is expected to be largely on strengthening infrastructure, investment in renewable energy alternatives and capitalizing on the fact that India is poised to become the third largest consumer economy by 2025.

INFLATION: Consumer price index (CPI) inflation for 2019-20 is projected to be at 4%

INTEREST RATES: The Monetary Policy Committee (MPC) has decided to fix the repo rates at 6%

ii. Indian Commercial Vehicle Industry:

The commercial vehicle (CV) industry is always considered to be the barometer of the Indian economic activity. The overall CV industry recorded a 17.6% year on year growth during 2018-19. Medium & Heavy Commercial Vehicles (M & HCVs) grew by 14.4% and Light Commercial Vehicles (LCVs) grew by 19.4% during the year 2018-19 when compared to the same period last year. The first half of 2018-19 witnessed good growth driven by the increased demand from the construction, mining & e-commerce industry. However during the second half the liquidity crisis and the increased axle load regulation had a negative impact on demand thereby effecting sales of commercial vehicles.

The first half of 2019-20 is expected to be sluggish with a recovery during the second half of the year. Investments into the proposed infrastructure projects, revival of construction and mining sectors, growth in tourism industry are likely to push the demand for commercial vehicles. The CV industry is expected to grow by about 10-12% during the year 2019-20 and is projected to grow at a CAGR of about 14%, in value terms, over the course of the next five years.

Expected pre-buying during 2019-20 on account the BS-VI mandate (1st April 2020) may play a major role in creating demand during 2019-20. Considering the upgrade costs, OEMs are expected to begin phasing out older models, essentially leading to a technological shift in the market.

(Figures in units)
Category 2017-18 2018-19 Growth
M & HC V Production 3,71,633 4,74,385 27.6%
M & HC V Sales 3,67,822 4,20,923 14.4%

II. Opportunities & Threats

During the year gone by, the company took focused efforts to increase the revenues through structured introduction of new products leading to an increase in the vehicle content, increased technology penetration and foraying into new advanced domains of commercial vehicle technology.

As a full system supplier, the company can uniquely connect truck, trailer, cargo, drivers, business partners and fleet operators real time so as to empower the fleets to significantly enhance safety and operational efficiency.The Company has leapfrogged in the space of telematics and has been successful in becoming one of the leading suppliers of fleet management solutions to two major global OEMs in India. The company launched the Automotive Indian Standard (AIS) 140 complaint Fleet Management Solution (FMS) device so as to help the commercial vehicle industry to meet the specification of the GoI for Public transport vehicles. To better support the OEMs when the regulation for increased axle load was effected, the company introduced larger sized compressors. During the course of the year, the application of the Automated Manual Transmission technology (AMT) of the company saw a steady growth as many OEMs in India extended its application to their various other vehicle platforms. The Company was also the strategic technology development partner for one of the leading agricultural tractor OEMs in India and was successful in demonstrating the concept of an automated tractor by integrating AMT, brake control, and steering technologies.

In line with its vision of "Saving lives; protecting the environment", the company introduced the Diesel Exhaust Fluid (DEF) which helps in the reduction of NOx gases in the vehicle exhaust. The Anti-Lock Brake Systems (ABS) legislation for M3 and N3 vehicles got implemented from the third quarter of 2015-16 that resulted in increased business. Other advanced active safety features will become mandatory in the near future and there are numerous discussions ongoing in terms of promulgating legislation to this effect during the course of next few years. The Company looks forward to the following strategic opportunities in the coming years.

• Partner with Trailer customers for implementing 100% TABS and penetrating Intelligent Trailer Program products

• Technical / Homologation support for advanced technology products

• Leverage / expand its manufacturing footprint to ensure increase customer centricity

• Penetration road map for newer technologies like Electronic Stability Control (ESC), Advanced Driver Assistance Systems (ADAS) and active steering

• Doors with door control system, air suspension systems,

• Increase the share of market for Diesel Exhaust Fluid (DEF) post BS-VI implementation Anticipating evolutionary changes in the traditional aftermarket business models, the company is striving to introduce new revenue models like technical service stations at OEM dealer points and major fleets across the country, leveraging the wave of digitalization by better utilizing the e-commerce models and other initiatives to be ahead of the curve.

Distributors are continuing to increase their presence in B & C towns resulting in increased availability of genuine spare parts in far flung locations. The authorized service center network is expanding and currently the company has around 280 service centers with pan India presence to cater to the customer requirements. To improve the customer reach, mobile smart catalogue application has been launched and so far approximately 14,500 customers have been connected. These initiatives would result in improved service practices, availability of genuine parts and generate additional revenue for the company.

Given the growth opportunities that are available in the commercial vehicle industry we expect the activity levels of the competitors to be on the rise.

III. Risks and Concerns

The cyclical nature of the Indian commercial vehicle industry presents its own risk to the business. The operating expenses are likely to rise with the expected increase in prices of key raw materials.

STEEL

Steel demand in India is expected to grow above 7% in the current as well as next year, according to the World Steel Association. The global steel demand may reach 1,735 MT in 2019, a rise of 1.3% over 2018. In 2020, the demand is projected to grow by 1% to 1,752 MT. In developed economies, steel demand grew by 1.8% in 2018 following a resilient 3.1% growth in 2017. The demand is further expected to decelerate to 0.3% in 2019 and 0.7% per cent in 2020, reflecting a deteriorating trade environment.

Steel demand in emerging economies, excluding China, is expected to grow by 2.9% and 4.6% in 2019 and 2020, respectively. In India, wide range of continuing infrastructure projects is likely to support growth in steel demand. In developing economies in Asia, excluding China, the demand is expected to grow by 6.5% and 6.4% in 2019 and 2020 respectively, making it the fastest-growing region in the global steel industry.

The knock-on effect of the trade wars has been keeping pressures on steel prices across the globe. Global trade volumes have slumped for the first time in nine years. As a result, exports are slowing down leading to a rise in domestic inventory buildup. Domestic steel demand has also softened in recent months, which is expected to improve.

Demand from one of the largest consumers of flat steel, the automobile sector, is likely to be curtailed going forward. Auto sales have been contracting which is leading to an inventory build-up in the auto sector. Weak automotive demand, coupled with rising threat from imports and unattractive export markets have put flat steel producers at higher risk compared to long producers. In 2019, global auto production will continue to decelerate to 1% growth with stabilization expected only in 2020. The weight and engine power of vehicles has been on the rise, prompting a greater demand for stronger components across body frame, brake and suspension. In this context, the auto industry is seeing an increasing application of advanced materials for light weighting materials such as high-strength steel (HSS), aluminum, magnesium and carbon fiber. Light weighting gains particular importance in the case of Electric Vehicles as it directly reduces the power demand on the battery, increases battery range, reduces the charging cycles and enhances battery life. This is pushing up demand for aluminum and high speed steel (HSS). By 2030, the share of HSS in the material costs of a vehicle is expected to double.

Rising trade tensions and volatile currency movements are increasing the uncertainties in the global steel industry. Existing anti-dumping and countervailing duties have been rendered ineffective by the volatility in steel prices.

ALUMINIUM

Globally, aluminum is the second most consumed metal after steel and has a variety of industrial applications. China accounts for nearly 60 percent of global aluminum output. The global average per-capita consumption of aluminum is 80 kg and 25-30 kg in India, thus providing huge opportunities for aluminum demand to pick-up.

As an ominous forerunner of the risks ahead in 2019, LME aluminum prices suffered massive downward pressure in 2018, falling by 17.4% in a persistent downtrend throughout most of the year except during a brief period in April. Macroeconomic uncertainties led to corrections in global prices of aluminum in the last one year. It is further said that the production growth of the said material was even lower than the rise in demand.

The global consumption growth of aluminum during the first quarter of 2019 was muted at 1.4 percent as against 4 percent in 2018. Despite muted consumption levels, markets of the said metal continued to remain in deficit in this period, with shortages in fact expanding on a Y-o-Y basis, as production growth was even lower than the growth in demand.

We expect aluminum prices to take support and trade higher in the near term as Chinas Aluminum producers are expected to cut at least another 8,00,000 MT per year of smelting capacity in the coming months.

Risk Management:

The Company has laid down procedures for risk assessment and mitigation actions. The Board has constituted a Risk Management Committee to look into the aspects of risk management and periodically review it, to ensure that executive management, controls risk through means of a properly defined framework. Risks identified and mitigation measures are periodically checked by the internal audit team and are communicated to the Board of Directors.

IV. Internal control system and their adequacy

The Company has proper and adequate systems of internal control to ensure that all assets are safeguarded and protected against loss from unauthorized use or disposition thereof. All transactions are authorized, recorded and reported correctly. The internal controls are checked by internal auditors. Observations made by them, management actions and time frames are reviewed by the audit committee of the Board of Directors. Concerns if any are reported to the Board.

Since the ultimate parent company is listed at the NASDAQ, SoX compliances are also part of the companys annual compliance mechanism which adds an additional layer of testing and checking of adequate internal controls and process controls.

V. Operations review

A. Manufacturing

During 2018-19 following the companys operating system framework, and as a response to the prevailing volatile, uncertain, complex and ambiguous environment, the integrated supply chain took concentrated efforts to augment manufacturing capacity through plant expansions at the Mahindra World City and Jamshedpur. Additionally a memorandum of understanding has been inked with the Government of Tamil Nadu for expansion and industrial land has been allocated to the company at the Special Economic Zone in Ranipet. Executing the integrated supply chain strategy to improve service levels and responsiveness to customers, certain manufacturing lines were transferred to plants which are in proximity to the customers. Focused efforts were made to enhance productivity and quality through lean tools and facility upgradation programs.

The Companys manufacturing facilities, build on its strong fundamentals of Total Quality Management (TQM), Total Productive Maintenance (TPM) and Lean Manufacturing has best-in-class practices for safety, work environment, water and energy conservation deployed companywide to achieve significant improvement in productivity and reduction in manufacturing cost. During the year, Jamshedpur and Mahindra World City plants received TPM Excellence and TPM Consistency award respectively from Japans Institute of Plant Maintenance (JIPM).

The Company has an internal digital taskforce which comprises Gen Y & Gen Z talents who work under the guidance of the leadership team to implement smart manufacturing concepts of industry 4.0 thereby making the plants future ready. Low Cost Automation, Robotic Process Automation, Industrial Internet of Things, Traceability Systems, Machine / Computer Vision etc., have been also extended to the entire value chain.

During the year, focus was also on strengthening the overall inventory process from ingress to egress including stepping up the control environment around inventory counting through dedicated management focus in addressing root causes of identified issues, training and transforming mindset, better deployment of personnel and improving the overall accountability environment.

"WIN 2.0" was a transformation initiative intended towards changing the mindset of employees at all levels, all functions across locations to achieve global standards of performance.

This initiative, now widely and deeply imbibed in employees has already started yielding visible results in all areas of operations. This transformation has been acknowledged by key customers with awards. During the year company received "Supply Chain and Logistics Excellence" award under category "Best Technology Adoption" from CII and Institute of Logistics for its focused effort on improving logistics efficiency with use of technology. This is the third time in a row that the company has been presented with this accolade.

B. Quality

The quality systems in the company aim at achieving total customer delight through its focus on improving product quality confirming to world class standards. This is achieved through inculcation of quality mindset and transformation among employees. The Company is at 15 PPM for the year 2018-19. Customers continue to expect the industry bench mark of Zero PPM. To meet the ever evolving customer requirements it is necessary to standardize the process, operate with right competency / skills of the workforce to consistently supply right quality of products.

Six sigma tools are used and projects are rolled out for each customer to meet their requirements and to standardize all critical production lines. Deploying "VDA6.3" and "VDA6.5" process and product requirements, product safety standards and IATF 16949 helped the company to eliminate the defects significantly.

Project quality along with product engineering quality achieved 100% customer PPAP "First Time Right". Significant efforts were put in to improve product quality which ensured that there was no recall of products or service campaign during the year.

Total Quality Management is a way of life at the Company. As part of this, 100% participation in total employee involvement has been successful for the past two decades. Employees across all plants were involved and have completed 250 quality control circle projects, 111 supervisory improvement team projects and cross functional team projects by applying statistical tools, including Six Sigma (DMAIC and DMADV) and Quick Response Six Sigma (QR6S) methodology during the year. Over 105,978 suggestions have been implemented by all employees throughout all the plants, including trainees. Employee suggestion scheme is in force at all plants and employees implement suggestions under productivity, quality, cost, delivery, safety and morale categories. In order to foster employee engagement across all plants, interplant quality circle and six sigma competitions were conducted and best teams were recognized.

Quality control circle, cross functional teams of employees participated in external competitions conducted by industry bodies, Automotive Component Manufacturers Association

(ACMA), Confederation of Indian Industry (CII), National Institution for Quality and Reliability (NIQR), Indian Machine Tool Manufacturers Association (IMTMA), Quality Circle Forum of India (QCFI), Indian National Suggestions Schemes Association (INSSAN) and have won various prizes demonstrating their passion and innovation in various areas of excellence in quality & manufacturing which are given below.

Notably, a QCC team from Ambattur plant had won the gold award in an international QCC competition conducted by Singapore Productivity Association in Singapore. The team qualified for the international QCC competition by winning the regional and national level QCC competitions.

a. 1st, 2nd & 3rd prizes in ACMA Quiz competition Ambattur & Mahindra World City teams

b. QCC Gold award in Raipur RUDRA QCC & RAINBOW QCC teams

c. First Prize in HR best practice award from ACMA southern region

d. CII Scale award for logistics excellence

e. First Prize in Quality category in ACMA southern region KAIZEN award

f. Par excellence award in QCFIS SIT/CFT Competition by Ambattur team

g. 1st Prize in CII eastern regional QCC competition by Jamshedpur team

h. Platinum award in QCFIS 5s competition by Ambattur team

i. Platinum award in ABK AOTS DOSAKAI QCC competition by Ambattur & Mahindra World city teams

j. Silver award in CII Digitalization, Robotics & Automation competition by Ambattur team

k. Silver award in QCFIS SHE Competition by Mahindra world city SHE team

C. Cost management

The company continues its focus on upgrading the robustness of cost control mechanisms and capabilities in all activities, especially procurement, operational expenses and manufacturing. The Company realizes that better cost management is the key differentiating factor in this competitive environment, the prime strategies are value creation through design improvement, localisation of inputs and products and conversion cost productivity.

Cross functional teams are formed with members from various functions like product engineering, manufacturing & sourcing to focus on identified cost reduction projects. The Company continues to find best cost supplier across continents leveraging the global platform in an endeavor to become best cost supplier to our customers. Key focus area is process improvement through technical collaboration with leading suppliers to continuously keep the costs at optimal levels.

D. Information Technology

A digital transformation drive was initiated during the last year under 3 major areas - enterprise transformation, digital transformation and enterprise security. As a part of this numerous analytics & robotic process automation projects have been initiated and are in various stages of implementation and maturity for various departments viz., product sales, fleet management, quality, Manufacturing & Logistics. The analytics projects and robotics process automation tools are focused to help improve sales and reduce operation costs. Pilot projects have been rolled out in the shop floor with focus towards Industry 4.0 and transformation into smart factory encompassing energy management / optimization, integrated production management system, predictive maintenance etc.

IT security awareness campaigns have been carried out for all employees for protection against ransom ware, phishing and data security. To ensure IT security at all locations, various cyber & data security initiates have been carried out during the year as per the WABCO group security road map and directions including

• Assessment and Certification of the IT department and the Big Data Analytics Center at Ambattur plant as per ISO/IEC 27001:2013 standard for Information Security Management.

• Security restriction applied across the organization for new USB ports to avoid data theft.

• Enabling data leak protection for all users.

• Enabling security hardening and windows re-imaging for all industrial computers at the shop floor.

VI. Human Resource Development

The company focuses on attracting and retaining best talent and enjoys a good brand image across leading educational institutions and talent pool. As part of adding new and young talent pipeline to the existing talent pool, the company had undertaken a Graduate Engineer Trainees campus drive program during the year and had selected 50 fresh Graduate Engineer Trainees from top colleges in India viz., NIT, BITS etc. This program is expected to enrich and deliver one of the Companys value pillar namely "Passion for Innovation" by bringing in millennial to the existing talent pool. This program is fully orchestrated by the HR function with technical panel interview support from internal stakeholders and has turned to be a grand success.

During the year the company has inducted 184 new talents focused mainly for Product Engineering. The current average recruitment lead time of the lateral talent is around 50 days. The Company successfully blends mid-career recruitments with internally grown talent through a robust globally managed talent management process. Rewards and recognition system is in place to retain and provide fast track growth for high potential employees. Internal talent mobility rate which is at 59% is one of the key engagement driver ensuring employees to move and grow within WABCO group across functions, businesses, and countries. The Companys voluntary turnover rate is at 6.95%, while similar industry attrition rates are at an average of 9.9%.

Induction program to orient new joiners continues to be one of the focus areas and was revamped during the year. A kit containing branded merchandise has been introduced for new joiners containing policy manuals, code of conduct etc., which has helped provide a wow feel to the new joiners. Familiarization of the Code of conduct program is also a part of the induction program so that they can better understand the importance of complying with the code and policies of the company.

To strengthen the existing talent hiring strategy and to stay at par with the market and other geographies in the group regarding practices on probation period, the probation policy was amended to include 6 months as the probation period for the employee grades up to E7/6B and no probation for the grade M1/7A and above.

The companys culture is a pillar of differentiation. Known as "The PACEmakers the culture has its own unique identity to help inspire and align the rapidly growing team. The PACEmakers guide personnel to nurture specific behaviors that are critical to help power continued success; behaviors that encourage unleashing passion, use diverse talents to the greatest effect and work together in a rich environment of creativity and collaboration. These behaviors include 1) Be Authentic, 2) Foster Engagement, 3) Leverage Difference, 4) Cultivate Collaboration & 5) Be Accountable. Workshops were conducted for employees across functions to understand the pacemaker behaviors and live them to the best of their abilities.

"Talk 2Me", "Womens Forum" and "Blue Collar Contact Program" initiatives have helped to build strong bottom up communication and ensures healthy industrial relations climate across all locations resulting in zero man hour loss. New joiners get together program addressed by the Managing Director serves as a platform to communicate the companys and groups vision and also understand the expectations from the new joiners. Development of Entry level Agile Leaders (DEAL) is another tailor made program introduced for developing leaders from entry level to add to the talent pipeline of the Company.

As of 31st March 2019, the Company had 1778 employees on its rolls.

VII. Environment & Safety

The January to March quarter was taken as safety months and used to enhance safety systems and create safety awareness among the employees. During the year, based on the theme "Target 3 Zeros"i.e Zero Hazard, Zero Fatigue & Zero Discharge more than 100 Kaizens were implemented at the shop floor. These were followed up with competitions across plat locations. All plants and test track have completed the recertification audit of ISO 14001 & OHSAS 18001 during the year. The plants at Ambattur, Mahindra World City, Lucknow and Jamshedpur have been certified for ISO 50001 standards for implementing energy management systems and achieving continuous improvement in energy performance.

The Company has taken many initiatives on improving ergonomics in the shop floor. Medium fatigue stations were identified and the ergonomics was improved with achievement of low risk job stations of 98%, thereby improving productivity and operator morale. As part of horizontal deployment, Jamshedpur and Pant Nagar plants initiated the Ergo Stretch program for shop floor employees which helps operators refresh themselves and reduce fatigue.

As part of environmental protection, the installed sewage treatment plant treats and reuses water which is used for gardening thereby reducing the water consumption by 15%.

During the year Ambattur plant won "4 star" award for the best SHE practices from the Confederation of Indian Industries and "Best Safety kaizen" award from ACMA southern region for implementing safety kaizen in Ambattur plant.

Brand refresh:

During the year, WABCO Brand was reenergised by introducing the tag line "Mobilizing Vehicle Intelligence". Mobilizing Vehicle Intelligence is a new, compelling tagline that was introduced under the WABCO brand. This is the first time that the group has adapted the corporate brand in this way to help describe how it wants to be seen and understood.

Mobilizing Vehicle Intelligence was launched to concisely and powerfully communicate the shared mission, industry expertise and the focus of global teams passion to all WABCO stakeholders. It frames what we believe will sustain WABCOs differentiation in the rapidly converging and digitalizing commercial vehicle industry.

A future where transportation ecosystems become operated by fully-autonomous, connected and electric commercial vehicles is still quite a number of years away. Yet, the Company seeks to sustain its strong reputation as an innovator and pioneer of critical vehicle control systems, new energy technologies and digital solutions as the industry migrates towards this goal. The company believes that "Mobilizing Vehicle Intelligence" represents a powerful declaration of the essential role WABCO will play in delivering key vehicle control technologies and operating functions necessary to achieve this vision.

Autonomous Connected & Electric (ACE) are the three key domains of innovation focus for the company to drive growth. These innovations will help to advance vehicle autonomy, enhance road safety, empower the fleets and pave the way for greener transportation. To further the advent into the ACE domain, the Company is undertaking several key strategic initiatives:

• To launch advanced technologies for electric vehicles

• To drive the vision of connected vehicles in India by steadily increasing offerings in the fleet management solutions portfolio.

• To further autonomous driving in India partnering with leading OEMs of Both CV and OH industry.

VIII. Community development and social responsibility

As a responsible corporate citizen, the company engages in social responsibility and community development activities. This year the activities were conducted through internal engagement of employees and resources, primarily focused on activities which would help the needy sections of the society as specified in Schedule VII of the Companies Act, 2013 and the Companys CSR policy with specific focus towards areas surrounding the companys plant locations.

The Company is also in the process of identifying suitable projects and scaling up the existing projects and hence could not spend 2% of the average net profits of the last three years. The Company has established a trust in the name of WABCO Foundation for carrying out CSR programs, which identifies appropriate CSR projects in line with the Companys CSR policy and implements them. The CSR Activities of the Company for the FY 2018-19 are mentioned in the Annexure - 2 to the directors report.

The company has identified four primary areas to focus its CSR activities.

Promoting road safety across India - The Government of India is taking consistent efforts to reduce accidents through safety education, safety engineering, creating safe environment and enforcement. In an effort to support this initiative the WABCO foundation has been conducting safety awareness training programs for commercial vehicle drivers, and vehicle maintenance technicians combined with health checkups. More than 5500 drivers & technicians across Tamilnadu, Kerala and Andhra Pradesh have been trained on road safety by creating awareness on vehicle safety & safe driving practices, advanced braking systems, etc. These projects were carried out in association with the Regional Transport Offices and State Transport Undertakings. The safety awareness camps are complemented with medical and eye check-up camps for the participants. Considering the tremendous acceptance, response and impact of such programs the foundation plans to extend this pan India. This has resulted in transforming the lives of drivers and mechanics which will, in turn, translate into safer roads.

As part of this important road safety objective, the Company has also collaborated with Praxair India, one of the worlds largest Industrial Gas companies and State Transport authorities, to provide advanced driver training for drivers of hazardous cargo carriers, fuel carriers, etc. These programs are conducted by subject experts from the industry along with practical sessions for drivers. Over 500 drivers have been trained since inception in various modules through classroom and practical sessions including safe driving practices, - rollover stability, the advantage of using ABS & EBS and other safety technologies. These programs have been well received and have helped the attendees to maintain zero accident levels. The drivers receive a certification on successful completion of this course.

Employability & skill enhancement through partnerships with educational Institutions - The Company being a pioneer in technologies and services that improve safety, efficiency, and connectivity for commercial vehicles is uniquely poised to share its best practices, knowledge on safety & efficiency with budding professionals thus enhancing their employability, skills and also contributing to road safety. This has been done in partnership with universities / colleges in Tamilnadu where Centers of Excellence for skill development have been set up.

Environment sustainability - Nurturing environment through tree plantations, rainwater harvesting, etc., in and around our plant locations were carried out wherein more than 1000 tree saplings across locations were planted and are being maintained.

Community services - Various community services were undertaken like Blood Donation camps by employees, personal hygiene awareness & health checks to drivers, primary school children, upgrading road safety infrastructure in and around the plant locations etc.

IX. Financial statement

Particulars Year ended 31st March 2019 Year ended 31st March 2018
in lakhs % द in lakhs %
Revenue from contracts with customers 2,85,413.56 97.52 2,61,384.81 98.25
Other Operating Income 7,247.53 2.48 4,652.78 1.75
Total Income 2,92,661.09 100 2,66,037.59 100
Raw Materials Consumed 1,83,454.22 62.68 1,55,143.27 58.32
Changes in inventories of Finished goods & WIP (1237.27) (0.42) 5046.57 1.90
Staff cost 25,364.41 8.67 22,909.87 8.61
Stores & tools consumed 5,953.97 2.03 6,281.26 2.36
Power & fuel 2,183.63 0.75 2,073.33 0.78
Repairs & maintenance 1,402.91 0.48 1,356.72 0.51
Other expenses 27,304.12 9.33 24,661.14 9.27
Finance costs 161.74 0.06
Excise duty on sale of goods 4,051.58 1.52
Depreciation 7,143.69 2.44 6,173.69 2.32
Total Expenditure 2,51,569.68 85.96 2,27,859.17 85.65
Profit Before Tax 41,091.41 14.04 38,178.42 14.35
Provision for taxation 12,874.48 4.40 10,895.79 4.10
Profit after Tax 28,216.93 9.64 27,282.63 10.26
Other Comprehensive Income / (Loss) for the year net of tax (197.96) (0.07) (73.52) (0.03)
Total Comprehensive Income / (Loss) for the year net of Tax 28,018.97 9.57 27,209.11 10.23

X. Cautionary statement

Statements in the management discussion and analysis report describing the Companys objectives, projections, estimates and expectations may be "forward looking statements" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companys operations include, among others, economic conditions affecting demand / supply and price conditions in the domestic and overseas markets in which the Company operates, changes in the Government regulations, tax laws and other statutes and incidental factors.