20th Annual Report 2013-14

BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION The Compass

Whether traversing land or sea, for centuries the compass professional is aligned in harmony. Neither the severity of has helped explorers arrive safely at their destinations. the terrain nor the victories and failures along the journey will sway our vision, shake our determination. Archaeology dates the first compass back to 150 B.C. Long before it was used to indicate due north, the compass was Because like ancient explorers, we know that with regarded as a force of nature with the power to illuminate compass in hand, our goal is not only attainable, a path to enlightenment. Much like modern-day achieving it is our destiny. explorers, ancient people believed each step in life's journey, no matter how small, could bring one closer to his destiny or dangerously veer him off course.

Our One To Win goal is ambitious: generate $1 billion in revenue and lead the industry in engineering and design services for the manufacturing sector. With the needle of our compass fixed exclusively on this goal, each of our territories, divisions, and every Tata Technologies

VISION We are determined to be the world’s number one partner to the manufacturing industry.

MISSION Better products benefit people - that is our business.

VALUES Better & Better Customer Delight One Team Honest & Straightforward Commitment to Community Contents

Letter to Shareholders II Letter from the Global COO VII Senior Management IX Highlights & Milestones of 20 Years XI Navigating Toward a Better Future Today XIII Corporate Sustainability XXII Board of Directors XXIX Notice 1 Directors’ Report 7 Management Discussion & Analysis (MD&A) 16 Corporate Governance Report 50 Auditors’ Report 64 Balance Sheet 67 Profit and Loss Account 68 Cash Flow Statement 69 Notes forming part of financial statements 70 Consolidated Accounts Auditors’ Report 97 Balance Sheet 98 Profit & Loss Account 99 Cash Flow Statement 100 Notes forming part of financial statements 101 Statements on Subsidiary Companies 130 Frequently Asked Questions 132 Attendance Slip / Proxy

This report and financial statements contained herein have been prepared in compliance with the requirements of the Companies Act, 1956 and Indian Generally Accepted Accounting Principles (GAAP). The preparation of financial statements requires management to make estimates and assumptions which affect the reported amounts of income and expenses of the period, assets and liabilities, as of the date of the financial statements. The estimates and judgements relating to the financial statements have been made on a prudent and reasonable basis, so that the financial statements reflect in a true and fair manner, the form and substance of transactions. Historical Performance

Revenue Profit After Tax

2,500 2,395 350 2,250 2,045 301 2,000 300 273 1,750 1,667 250 1,500 208 1,268 200 1,250 1,098 150 139 1000 Revenue (INR Crore) Revenue 750 100 91 500 Profit After Tax (INR Crore) Tax After Profit 50 250 0 0 2009-102010-11 2011-12 2012-13 2013-14 2009-102010-11 2011-12 2012-13 2013-14

Offshore Revenue FreeDiluted Cashflow Earnings Per Share

450 414 400 80.00 69.88 350 70.00 321 63.48 300 60.00 257 250 50.00 49.20

200 40.00 37.15 155

150 EPS (INR) 30.00 24.33 103 100 20.00

Offshore Revenue (INR Crore) Revenue Offshore 50 10.00

0 0 2009-102010-11 2011-12 2012-13 2013-14 2009-102010-11 2011-12 2012-13 2013-14

** Revenue generated by Offshore Delivery Centers

Cash & Cash Equivalents Free Cash Flow

450 20% 416 400 18% 18% 16% 1,000 968 350 16% 319 14% 800 775 300 12% 11% 12% 609 250 600 9% 10% 200 195 8% 400 150 142 6% 284 98 Free Cash Flow (INR Crore) Cash Flow Free 100 200 193 4% 50 2%

Cash & Cash Equivalents (INR Crore) Equivalents & Cash Cash 0 0 0% 2009-102010-11 2011-12 2012-13 2013-14 2009-102010-11 2011-12 2012-13 2013-14

**Cash and Cash equivalent includes investments in MFs, NCDs,CCPS,Bills of Exchange, ICDs placed and Free Cash Flow Free Cash Flow as % of Revenue Deposit with FIs,

Margin of Safety Dividend Per Share

100% 40% 90% 34 33 35 82 35 80% 78 81 30% 30 70% 26 30 61 26 25 60% 56 25 50% 20% 20 16 40% 15 12 30% 10% 10 20% 7 5 10% Dividend Per share (INR) share Dividend Per 0% 0% 0 2009-102010-11 2011-12 2012-13 2013-14 2009-102010-11 2011-12 2012-13 2013-14

Cash as % of Net worth ROE ** Numbers are in percentage

I Letter to Shareholders

“Your Company posted record revenue and free cash flow while reengineering its sales process.”

Dear Fellow Investors,

I am pleased to report to you that your Company posted record revenue, offshore revenue and free cash flow during the year 2013-14. Our consolidated revenue grew by 17% to Rs. 2395 crores, and offshore revenue by 29% to 414 crores. We registered a record cash balance of Rs. 968 crores, a growth of 25%.

CONSOLIDATED REVENUE 17% Rs. 2395 GROWTH CRORES

RECORD CASH BALANCE 25% Rs. 968 GROWTH CRORES

20th ANNUAL REPORT 2013 -14 II In my letter last year, I wrote given that we have increasing the overall dividend pay-out to a record 300%, demonstrated an ability to scale delivery, our strategy is i.e., 250% + 50%, a dividend of Rs. 30 per share (Rs. 12 to accelerate revenue growth. This is an 18-24 month interim + Rs. 18 final). journey involving external consultants and everyone in your Company. During this period we may need to accept some reduction in profits. Ultimately, we will accelerate Increasing the revenue growth while keeping our hard-earned overall dividend th pay-out to a record profitability and cash creation. AGM the board proposes We have defined, articulated and started 300% executing our strategy. As such, we increased our investment in SG&A from 12.1% of sales to In this letter, I will cover: some key achievements and 13.6% of sales, an increase of Rs. 78 crores. offerings in the marketplace, Cambric one year on, our entry into China, our commitment to institutionalizing We also spent over Rs. 11 crores on external innovation, the launch of Tata Technologies Motor consultants. This investment is starting to bear Sports, corporate sustainability and challenges for 2014- fruit. 15. In my earlier letters I wrote, to the degree I was allowed by client confidentiality, about the wonderful work your Company does. In 2011, I wrote about the creation of Our sales pipeline grew from $177 mn at the beginning of the Vehicle Programs & Development (VPD) group. In the year to $424 mn at the close. In the last quarter of 2012, I wrote about a prototype vehicle we designed FY14, we recorded the highest ever quarterly revenue of and built called the eMO for Electric MObility that Rs. 668 crores, leading to sequential quarterly growth of debuted at the Detroit North American International 10% and year-on-year growth of 22%. Automotive Show. In the 2013 report, we highlighted our work on a version for commercial use called eMO-c. Given our investment to accelerate revenue growth, your What I have not been able to tell you is that since 2011, Company posted a reduction in consolidated EBITDA your Company has been engineering a new premium and PAT by 9% to Rs. 393 crores and Rs. 273 crores, vehicle and this significant project is coming close to respectively. In spite of that, your Company grew its free the finish line. I can’t disclose the client or the details cashflow by 31% to Rs. 416 crores. Our free cashflow to until the vehicle is unveiled later in 2014, but I think you gross capital employed margin stood at a very healthy will find it represents a crowning achievement of our 20%. Our return on equity is a decent 26%. All of this entire value proposition. I saw the vehicle earlier in the resulted in a consolidated diluted earnings per share of year. It is one I think you would love to own, drive and Rs. 63 vs Rs. 70 a year ago. On a standalone basis, PAT and experience. earnings per share increased slightly over last year. I wrote last year about our Global Engineering Center (GEC) that distributes responsibility for engineering and product innovation across global teams without the FREE CASHFLOW segregation of low to high complexity work regionally. I’m pleased to share that your Company has proved this strategy to be successful and matured the GEC during the 31% to Rs. 416 three year development of the soon to be launched GROWTH CRORES vehicle. To date, and to the best of our knowledge, no other engineering services company in the world has achieved this. free cashflow to gross capital return I believe you will continue to see the success of our GEC employed margin on equity model going forward. Your Company is well established in emerging markets as well as developed markets in 20% 26% North America and Europe. We deliver quality services appropriate to the various market demands, from luxury western brands to frugally engineered cars in India. A Given our performance during this transition year, the McKinsey report suggests that by 2015, 85% of ER&D will board increased quarterly dividends to a total of Rs. 12 be done at sites outside of the home country. One can for Q1 through Q3, from Rs. 9 the previous year. In debate the numbers, but it is clearly a trend we are seeing. celebration of our 20th AGM, the board proposes This is not driven by cost alone. Factors such as proximity

III to market, close to production and access to local talent In the year under review we increased offshore revenues are becoming important drivers. This is exactly where our by 29%. We grew in Blue Ridge Special Economic Zone GEC value proposition fits. It also provides three (SEZ) to 989 engineers and IT professionals based there important advantages for our customers: lower capital from 826 last year. Our center in Bangkok continues outlay, flexible talent management and control over to grow. Over the last eight years it developed and outcomes. Our skills, proprietary tools and engineering matured capabilities that are now being recognized by expertise across multiple domains and verticals, enable our customers as adding value globally. Our centers in our GECs to help our customers create better products. Bangalore continue to grow. We plan to consolidate and move to a larger facility there in 2015. Our Customers also tell me about the increased value they get when your Company engages with them across engineering, product lifecycle management, and manufacturing IT. Our new BETTER SOLUTIONS offerings help them make major savings in cost and improved Blue Ridge SEZ quality & speed. Product Lifecycle Management (PLM) engineers & IT professionals Scan and PLM Analytics shows our customers where there are opportunities to realize significant cost savings throughout the entire product development process, and how potential savings can drive better and tangible business outcomes.

In the words of one of our large French customers, 826 989 2012-13 2013-14 “The experience that we had with Tata Technologies was magnificent. The PLM team One thing is sure, we are growing and we provide jobs. In has done a fantastic job, not only in solving the 2012, I shared the milestone that the Tata Technologies family crossed 5000 professionals. Last year we grew to problem that we had, but also in getting the over 6000 professionals. And this year I am pleased to senior management of our company to share another milestone. Our family has grown to over understand what was at stake and help them 7000 professionals operating in 25 countries. decide on which types of decisions they should make.” engineers & IT professionals

Our Asset Optimization offering shows product developers how to get more from existing software and hardware assets and what is often overlooked – what they no longer need. Our ERP (SAP) scan is helping manufacturers unlock value from their investment in SAP. In addition, we unveiled and started to deploy 6000 7000 Business Analytics for manufacturers that will give them 2012-13 2013-14 deep insight into sales, supply chain, costs and inefficiencies, helping them increase sales, reduce costs and optimize operations. Our solutions are providing operates in countries manufacturers with real-time analytics and dynamic 25 dashboards that enable an information-driven business culture that aligns the right resources with critical decisions. We enhanced our position in automotive, industrial equipment and aerospace sectors, growing key accounts We continue to be the largest independent supplier of and adding new ones. You may enjoy reading more about PLM tools giving our customers important insight into some of these achievements in this Annual Report under the selection and use of these essential elements in their the Marketing section header “Building Business product development process. Momentum”.

20th ANNUAL REPORT 2013 -14 IV Cambric one year on Innovation

In my letter last year, I wrote about your Company From the very formation of Tata Technologies we’ve acquiring Cambric Corporation, a premier engineering known that innovation would form its core. We’ve services organization, to achieve greater domain received innovation awards from our customers and from expertise and presence in the Industrial Equipment the Tata group. We are also building a portfolio of patents. sector. Over the past year, the global heavy equipment industry was soft, impacting Cambric and its largest customer. During this time our sales teams joined forces. To accelerate progress, in June of last year we We introduced Cambric to Asia where your Company has strength and Cambric introduced Tata Technologies’ launched the Innovation Hub, and in March offerings to its customers. The value proposition of the 2014 we opened our first innovation center in combined organization resonated well with customers Hinjawadi. The center, named Srujan, will and positioned us to pursue and win broader and more provide workshops in “design thinking” for strategic engagements. Our customers are beginning to appreciate the unique capabilities and reputation of some 400 of our people in 2014-15 and serve Cambric’s Romanian engineering center. Its near-shore as a catalyst for the creation of more centers European location is also generating interest with our globally. customers in Europe.

I am happy to report that Cambric is getting good traction in Asia. Quarter four saw a revival in the global heavy equipment industry. And Cambric’s customers are Launch of utilizing our expertise in automotive to do things they had not done before. Our engineering teams across the Tata Technologies Motor Sports globe are working together on important customer programs and have seamlessly combined the broad Our engineers have a passion for all things with wheels. capabilities of the organization to provide more complete solutions, while also making it easier for In March 2014, we launched Tata Technologies customers to engage with us. Motor Sports and took third place in India’s first ever truck racing championship. Thus, leveraging Cambric’s expertise with our global footprint, we are adding value to existing customers and winning opportunities Twelve 8-ton Prima Trucks raced against each other at – previously unattainable – to transform new Buddh International Circuit, home of the F1 Indian Grand customers. Prix. If you were there, I’m sure you would have felt the passion we have for the sport and the work we do to create these massive trucks.

I do not believe that either company could have You can be proud of the work your Company’s engineers independently procured the quality and amount of new did to create the Prima family of trucks. Our work includes business that we acquired during Q4. digital mock-ups of the Prima family’s models which assisted Tata Motors in physical prototype building, CAE analysis, manufacturing planning, and simulation and China validation. We also continue to support the entire product development, engineering & manufacturing, IT On 10 March 2014, to meet the increased opportunities and product lifecycle management at Tata Motors. and projects in China, we officially opened a subsidiary Furthermore we are extending the Tata Technologies in Shanghai, 凯比科制造技术咨询（上海） Motor Sports brand to the UK where we are a team 有限公司, Cambric Manufacturing Technologies sponsor for one of our very own engineers, Mr. Steve (Shanghai) Co. Ltd. I look forward to there being much Brown. Steve is racing in the British Racing Sport Car Club more to report next year. Toyo Tyres Porsche Championship.

V Corporate Sustainability

To benchmark ourselves against the world’s best new reality. The board reviewed in detail, including inputs companies on parameters related to sustainability, i.e. from external consultants, and reached a unanimous society, environment, and economy, we participated for decision to appoint Warren Harris to lead the Company. I the first time in the Dow Jones Sustainability Index (DJSI). fully endorse their selection. He is passionately The index is a global benchmark based on in-depth committed to our vision, unique position in the market, analysis of nearly every facet of a corporation, including our customers and our people. He is committed to corporate governance, privacy & security, risk & crisis improving himself, completing the Harvard Advanced management, corporate citizenship & philanthropy, Management Program (AMP) in 2011. He is committed to innovation & knowledge management, customer the Tata Group, heading the Tata Network Forum in the relationship management, talent attraction & retention, United States. He is committed to quality and to our supply chain management, brand management, codes communities. And most importantly, he is committed to of conduct, and operational eco-efficiency. I am pleased growth. I look forward to supporting Warren and your to report that after a nine-month assessment our score is Company from my position on the board. 49, above the industry average of 40. The highest score in the sector is 80. I am not surprised we are above average as we have sustainability in our core DNA. We still have a In Summary lot to do and we have started actions to improve. Your Company posted record revenue and free cash flow Our commitment to those less fortunate is an aspect of while reengineering every aspect of its sales process. We your Company for which you can be proud. It’s not continue to deliver enhanced value in the spaces we that you find it outlined in our corporate charter or operate. Our acquisition of Cambric is successful, emblazoned on our hearts. It is shown by what those in demonstrating synergies beyond what each company the Tata Technologies family and our new members could do alone, adding value to each of our customers. from Cambric do for others. You may like to read our Our experts in USA and Europe, combined with highly Corporate Social Responsibility section of this Annual skilled, cost effective engineering centers in both Asia Report to learn about the thousands of volunteer-hours Pacific and Eastern Europe, resonate value. We continue our professionals freely gave and the many financial to be good corporate citizens and friends of the planet. contributions we made throughout the world. Please join me in thanking the 7020 dedicated men and women who make up the Tata Technologies family. They are the ones responsible for our achievements and I am Challenges for 2014-15 sure you will join me in appreciating their efforts.

We will stick to our strategy to accelerate revenue growth I thank you for your continuing trust and support and while keeping our hard-earned profits and cash flow. I look forward to seeing you at the AGM, interacting with With any journey of 18 to 24 months it is easy to doubt, to you and hearing any valuable suggestions you may say it is not working or that we should rethink. We will have to help your Company become better and more stay on course as we know this is the way. This is what our profitable. customers want, what our Board of Directors want, what you should want and all of us at Tata Technologies want. We will also continue to look for accretive acquisitions having domain, technology, territory or customers that enhance our overall value proposition. Succession Patrick McGoldrick Chief Executive Officer and Managing Director As I am to retire on my 65th birthday in September 2014, the Board of Directors started a process to select a th successor who will take your Company forward in its next 15 May 2014 stage of growth. In my 20 years with Tata Technologies, I focused on starting your Company, putting the fundamentals in place and giving it global scale. The board is keenly aware that a successor will face a very different set of challenges and needs to have the wherewithal to significantly grow your Company in this

20th ANNUAL REPORT 2013 -14 VI Letter from the Global COO

Dear Shareholders, By many measures, it was a successful year for Tata Technologies. We grew our revenue by 17 percent in rupee terms and 5 percent in US dollars. This marked 4 straight years of revenue growth. We also invested $32.5 million to acquire industrial machinery engineering services provider Cambric, which added 406 people to our global ranks and expanded our portfolio of delivery centers into a strategic new geography. Fiscal year 2014 was a pivotal year of transformation in our global sales organization with necessary change and new alignment. These strategic decisions and actions were a deliberate effort to position our value proposition higher in our customers value chain. With the year of investment and transition behind us, we can now capitalize on new opportunities and strategic client engagements even though our pre-tax operating income was down 9% as reported. So, as we continue to remix to higher value, we must also address those parts of our business that are holding us back. We have two specific challenges, and we have taken steps to address both.

CONTINUOUS 17% GROWTH REVENUE in last GROWTH

$ YEARS4

VII The first requires a commitment to invest strategically and Tata Technologies remains unmatched in our ongoing across Tata Technologies to further enhance our capabilities and commitment to developing skills and differentiation and competitiveness. A key focus of this technologies in these areas. commitment is the investment that we have made in enhancing our value proposition and specifically our Looking ahead to fiscal year 2015, we will continue to “BETTER SOLUTIONS” packaged service offerings. Our pursue growth, cost reduction, expanded market early investments in these areas have paid off—today, all coverage, delivery excellence, investments in our people of these service lines have achieved scale and are and innovation with our clients—all to achieve our goal of growing at rates substantially higher than the rest of the becoming a leader in product development services and business. The investment in Cambric has significantly solutions. improved Tata Technologies’ capability in the Industrial Machinery vertical, while also providing near-shore But we will have to move fast. The competition is not delivery capabilities for our European clients through standing still, and success will undoubtedly go to those over 325 engineers based in multiple Romanian delivery who innovate, those who are nimble and flexible and to centers. those bold enough to leave legacy models behind.

We also made great strides in improving competiveness through ongoing investments in our sales and business development teams. During fiscal 2014, we changed the entire sales leadership team in North America and replaced more than 50 percent of our European sales organization. These decisions are never easy, but we now have an extraordinary team of sales professionals that are properly equipped and eminently qualified to represent our evolving portfolio of capabilities. In closing, while much work remains to complete the STRATEGIC INVESTMENT transformation of Tata Technologies, I have never been more confident in the company’s future. We closed fiscal year 2014 with an unprecedented flurry of high-dollar, BETTER ACHIEVED SOLUTIONS BUSINESS SCALE VALUE non-related signings, signaling yields on our people and process investments and a building head of steam as we start fiscal year 2015 (see page no. XX “Building Business Momentum”). But more importantly, the engineering The second challenge involves pivoting the PLM and product development services industry remains a software products business to address new realities and people business, and between the skills, commitment and greater opportunities. To this end, we are accelerating the passion of over 7,000 Tata Technologies professionals move from transactional software sales to value-based around the world and a richly diverse network of solutions. In September, we moved forward with the sale customers and partners, we are uniquely positioned to of our transactional PLM software products business in innovate and lead the way forward. Germany. This divestiture is consistent with our continuing strategy of exiting lower-margin businesses, such as stand-alone software and related hardware solutions. But let me be clear—we are not exiting the PLM value- added-reseller business.

Tata Technologies will remain a leader in high- end PLM solutions, particularly solutions that Warren Harris attract service engagements. Manufacturers President & Global COO increasingly require service providers with a 15th May 2014 convergence of knowledge in engineering, enterprise IT and PLM technologies.

20th ANNUAL REPORT 2013 -14 VIII nt

From left to right

Richard Welford Sujit Dixit Patrick McGoldrick Stephen Bruford Warren Harris M Officer President Sales - Europe Head of Global Delivery CEO & Managing Director Vehicle Programs President & Global COO Ve Operations & Processes & Development NA- VP &

Archit Gupta Shreekanth Moorthy Alisa Harewood Ramesh Chandra Samir Yajnik S. Americas Head Office of Strategic PLM Global Delivery Head Head of Office for President ESG Global Delivery Head President, Sales and E& Management and Global COO COO Asia Pacific

Navigating Toward a Better Future Today

Tata Technologies, a global provider of engineering manufacturing industry in the near term is optimistic. services, serves customers across the globe. Unmatched Our growth strategy over this fiscal year centered on in our ability to help manufacturers develop and build investments that provide the most cost –to-benefit ratio better products through our deep domain experience by building on customer loyalty, expanding our global and service offerings, it makes us not only the obvious, footprint and contributing to expansion across all of our but the smartest choice for our clients. Our outlook for the territories.

Improved Solutions & Measurable Results

With insight from one of the world’s most respected customers, and clearly taking our value proposition to management consulting firms, Tata Technologies the market. Within six months of program launch we are retooled our go-to-market strategy. McKinsey & reaping the benefits: our pipeline has rocketed 235 Company - considered one of the “Big Three” consulting percent. firms – boasts the highest global market share in all of the consulting industry. Through their astute analysis and By aligning our marketing, sales and delivery teams, our with collaboration from Tata Technologies’ colleagues, “Sales War Room” analyzes sales efforts and assesses we clearly mapped all of our complex capabilities and customer opportunities. Constant measurement of the implemented a standardized, measurable, industry- selling cycle provides an in-depth and statistical proven sales strategy. understanding of what drives customer wins and losses. Our sales team can now replicate what works, and weed During FY2013 Tata Technologies launched this new out what doesn’t. selling methodology, widely used in the industry to drive sustained revenue acceleration, which we termed The restructuring of our internal processes and SPEED1. This year, we deployed the second part of the procedures is both responsible and sustainable. For strategy, the evolution of SPEED1 from methodology into example, by overhauling our Customer Relationship strategy: SPEED2. Ensuring superb execution of the sales Management system we have increased visibility across process across all three major territories, SPEED2 provides opportunities and aligned necessary delivery resources. the framework, systems and analytics that support rapid And by revamping our Global Account Management, we revenue generation. The methodology emphasizes sales created a collaborative and cooperative environment training, performance monitoring, listening to our between sales for multinational clients.

in six months SPEED 1 SPEED 2 new selling new selling 235% methodology strategy increase in sales pipeline FY 2013 FY 2014

XIII BETTER SOLUTIONS

With a laser focus to maximize our client’s product development investments we have retooled and repackaged many of our service offerings this fiscal year. The rationalization of our core competencies with an improved focus on providing even better value is requisite to building Knowledge Manufacturing better products for our clients and for achieving further Solutions Engineering growth. Through the branding of our core competencies, those that we have refined over the last two decades, our go-to-market strategy is proactive, not reactive. The complexities plaguing individual manufacturers vary, yet, we know commonalities exist. Thus our BETTER SOLUTIONS Business Product services and solutions are based on industry-wide pain Analytics Analytics points. The packaged BETTER SOLUTIONS offerings eliminate the need for drafting one-off contracts by providing straightforward, standardized solutions. As intended, BETTER SOLUTIONS provides an avenue to deepen SAP Scan Global established accounts and garner quick, new-customer wins. Engineering Through an extensive virtual campaign and training Center sessions, the value of BETTER SOLUTIONS and how best to sell them is being propagated throughout our company. Arming our sales professionals with strategic offerings, architected around the most visible and problem-causing PLM issues for manufacturers, has yielded a more clearly defined Analytics identity in the marketplace. As a result, a quarter of the current pipeline can be attributed to BETTER SOLUTIONS offerings.

20th ANNUAL REPORT 2013 -14 XIV With our go-to-market strategy polished and our Customer loyalty is absolutely essential to earning new competencies clearly packaged, over the next fiscal year business, growing established accounts, and ultimately Tata Technologies will host an engineering industry achieving our One To Win goal. Cultivating customer conference for C-level executives in each our three major loyalty begins with listening to our clients – hearing territories: North America, Europe and Asia. These the Voice of the Customer. During FY2014, our Company invitation-only CxO conferences are not about making set out to improve our customers’ experience by the hard sell. Rather, they are opportunities to forge guaranteeing the professionals – of any level – within strong relationships across multiple industries. Aiming to our clients are heard. understand what keeps executives in the industries we serve awake at night – and providing our own Thought Leaders a stage to address these concerns – will build bridges and more clearly demonstrate our value This year Tata Technologies will implement Net proposition. In the ordinary sales cycles it is incumbent on Promoter Score – a full-featured, self-service, the sales professional to artfully present our value cloud-based customer experience program. It proposition so that it is communicated up through the is a scientific method by which we can measure value chain within a prospective client. Through the top- and then score how well we are serving our down approach of CxO conferences, our message will filter down through organizations; a far more efficient clients. approach to convey our value proposition. The first CxO conference is scheduled for the fall of 2014 in Chicago Illinois, USA. Through this industry-leading methodology, slated to launch in FY2015, Tata Technologies will be able to quickly disseminate customer surveys and then assess those surveys in real-time, permitting us to make immediate tweaks to the customer experience. Immediate intervention when a customer has a the first negative experience, no matter how minor, is essential to furthering customer loyalty. Introduced a decade ago CxO in the Harvard Business Review, conference the Net Promoter Methodology has been shown to increase customer loyalty, reduce attrition and improve the likelihood of earning a referral from a customer.

More importantly, and the driving factor for Tata fall of 2014 Technologies to install the application, research has also proven that the length of a relationship with a in CHICAGO customer and consequently, a higher score, are directly proportional to the revenue that a given customer generates.

XV Taking Internal Innovations to Market

Fostering an atmosphere where internal innovations are appreciated and recognized ensures we continue “A full suite of best-practices methods and working at an optimal efficiency level. In addition, internal enabling technologies that focus on the innovations can also become revenue-generating complete product lifecycle to solve specific services and products. From design and simulation know business problems.” how to expertise in multiple design software applications Tata Technologies professionals are constantly working to create improved products for our clients. These proven software virtual world capabilities combined with keen PLM involves every aspect of a manufacturing firm. And insight in impacts of speed to market, cost efficiencies because every aspect of a manufacturer’s business and and product quality translate to proven solutions for the processes affect its product development, PLM solutions real world. While we work in the IT services space, we offer should, if properly configured and widely adopted, help our clients much more than IT know-how. The core of our manufacturers get their products to market and help expertise – the core of our business - is in manufacturing refresh existing products, faster than their competitors. and engineering. This enables us to better exploit manufacturing efficiencies through optimized IT systems Three quarters of companies using PLM report that their compared to purely IT firms. Mired in day-to-day solution adds little or no value at all. Recognizing this operations, many manufacturers are not aware that IT need, Tata Technologies is currently developing a three- systems can impact their final product. staged PLM application to help manufacturers assess their current PLM architecture and pinpoint deficiencies. The global PLM market grew close to 12 percent in 2012, In minutes, the first stage of the new PLM application will despite lackluster improvements in overall economic gauge the overall maturity of a firm's PLM environment conditions. A leading PLM research association, CIMdata, and provide real-time feedback. Bringing this application forecasts the PLM market to achieve impressive growth to market via the Internet allows our Company to through 2017, from the $33 billion industry it is today to establish instant credibility with prospective customers $50 billion. As defined by CIMdata, PLM is: across the globe.

Our PLM application is backed by 25 years and 18 million man hours of experience helping manufacturers build elite products by optimizing PLM architecture. For manufacturers facing rising costs and global competition, operating efficiently is as vital as producing quality products.

Impact Analysis 25 Maturity years of Matrix experience

PLM Analytics Results 18 million Data Statistics man-hours

ROI

20th ANNUAL REPORT 2013 -14 XVI Vehicle Development that Drives Results

Not all of our services can be so easily packaged, explained or branded. Engineering any product is a lengthy and complex process. Launched in 2010, the Over the past several years your company has Vehicle Development Program group has become one been a key supplier creating increasing value to a of our Company’s most visible divisions. With high- premium automotive manufacturer in Europe. caliber engineers and creative off-shore solutions, our Our ability to retain highly competent engineers Company provides premium automotive engineering andto earntrust have been enablers to inherently services. And this year Tata Technologies will stand with understanding the key drivers of their business one of the world’s premium automakers in the launch of including process adherence and quality an all-new premium vehicle. Our unique partnership, unmatched in scope and complexity of the project standards. Working hand-in-hand our project deliverables, marks the first time this automaker teams integrate seamlessly outsourced the body engineering of a full vehicle into their organizational structure. The global reveal program – from concept through launch. 2014PARIS of the vehicle will take MONDIAL DE Our engineers, tasked with delivering the true intent place at the prestigious L’AUTOMOBILE of the automaker’s original design, was split between 2014 Paris International 4-19 OCTOBRE our Coventry technology center and our Offshore Auto Show. Dedicated Engineering Center (ODEC) in Pune. Our talent in India proved that our Global Engagement Model is an effective methodology for even the most complex engineering projects.

Tata Technologies - SEZ, Blue Ridge

XVII Strengthening In-Demand Competencies

The complexity of software used in automotive To achieve greater domain expertise and presence in the applications is growing faster than that of traditional IT Industrial Equipment sector, Tata Technologies in April systems, allowing for greater innovations in the vehicle 2013 acquired US-based Cambric Corporation. Our itself. Embedded systems, a key driver of innovation, clients had expressed a need for capabilities in this space integrate the mechanical with the electrical, and help and Cambric’s customers expressed interest in the Asian power nearly every manufactured product. Engineering market. Cambric, a 25-year-old company, boasts some a vehicle is no longer purely mechanical. To ensure we of the world’s marquee clients in heavy machinery, continue delivering the full spectrum of engineering and agricultural, off-highway and automotive industry. The product design, during FY2014 Tata Technologies investment made sense. Not yet a full calendar year since invested in capital equipment as well as human capital to the Cambric acquisition, our Company is profiting. strengthen our expertise in embedded systems.

Tata Technologies is one of a few elite Through the Cambric acquisition, Tata Technologies engineering outsource partners with the has expanded where we serve our clients and added engineering capabilities in powertrain and industrial ability to serve our clients wherever they are machinery. During Q4, Cambric was instrumental in through our Global Delivery Network, making securing business with an American automaker and us well-positioned to respond to the evolving long-time Tata Technologies client for high-end power needs of the global manufacturing industry. As train engineering. And long-time Cambric customers are now able to leverage Tata Technologies expert Global the industry expands to support emerging Delivery Network. economies and new technologies, so too must our own collaborative infrastructure.

20th ANNUAL REPORT 2013 -14 XVIII Approximately 325 engineers staff Cambric's three Romanian delivery centers, all of which are poised for Tata Motors is the largest manufacturer of rapid growth. For our European clients, tapping into our commercial vehicles in India, which is one of Romanian delivery centers offers more than cost-savings. the world’s largest trucking markets. And the No visa requirements and just a short, three-hour flight company’s Prima, considered by many to be from most European hubs, Romania is a convenient near- shore outsourcing option. the best truck range in India, set a new standard for trucks in the country.

NEAR SHORE DELIVERY Tata Motors organized the T1 Prima Truck Racing Championship to raise the profile of trucking careers in India while also bolstering brand recognition. The race 325 attracted more than 30,000 spectators – many of them ENGINEERS Tata vendors, suppliers and partners – along with local and international media. Truck racing first gained Romania popularity in the eastern U.S. in the 1970s before spreading to South America and Europe, where the As noted in the CEO and Managing Director's Letter to majority of professional truck racing takes place. Our Shareholders, for Tata Technologies Motor Sports - the championship racing team was led by accomplished official racing brand of Tata Technologies - earning a place UK driver Dave Jenkins. The 2011 British Truck Racing on the winner's podium was as important as showcasing Association champion placed second in the sprint race the wide-ranging and exceptional work we do for our and third in the main race, good for the combined overall clients. third place finish.

Tata Technologies Motor Sports

XIX Building Business Momentum

Our enduring Mission to create better products because In Q4 of FY14, Tata Technologies signed more new, non- they benefit people underpins our commitment to our related business than in any other period in our 25-year valued customers and serves as our catalyst for history. These new engagements span all of our lines of continued business momentum. By deepening our skills service, have been won in all three territories, in each of and streamlining our business, it is our clients who reap the primary domains we serve: automotive, aerospace the greatest benefits of our business transformation. and industrial machinery. Competitively priced solutions Our FY14 strategy included only those investments likely make us contenders in any market. However, it is our to yield long term growth. Such initiatives rarely expert engineering capabilities that take us across the generate immediate returns. Yet, at the close of this fiscal finish line. year, we are seated at the cusp of true transformation.

Revenue generation from Non-related business

1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014

This year, our Company began realizing the client. In the UK, our Company replaced an incumbent synergy with Cambric. In the coming months, competitor to win an engineering services engagement we begin repackaging a diesel engine to for a European automaker. Our seminal work on a premium vehicle has made us the preferred ESO for future accommodate compressed natural gas engineering engagements for a European OEM. (Read for an American automotive OEM. Further more about this in the Managing Director’s Letter to capitalizing on Cambric’s strengths, our Shareholders). Our APAC team is expanding our reach in company engineered and built prototypes the aerospace sector, with new client engagements. Work is set to begin digitizing aero structure components for a for a new natural gas power generation unit European aerospace OEM. for a leading industrial machinery OEM through the leverage of our offshore delivery The evolving marketplace requires flexibility and agility. Meet our partners where need us to be ensures relevance capabilities. and a market stronghold. There in March 2014, Tata Technologies established

legal entity status in Shanghai China China. And we are laying the

Across the globe, we celebrate significant achievements. operational foundation to ESTABLISHED LEGAL Our VPD group will engineer and design interior and improve our reach with key ENTITY STATUS Shangai exterior class A surfacing of a new vehicle for a luxury clients in other demanding European automotive OEM, which was once a PLM and fast growing markets; partner and has expanded to an engineering services Brazil and Japan.

20th ANNUAL REPORT 2013 -14 XX Giving Back

Our ultimate purpose as a member of the Tata corporate committed to the communities in which we operate and family is far greater than our services and solutions take pride in our Corporate Social Responsibility policy. combined. Our long-term stakeholder value creation lies In every one of our territories, Tata Technologies in the pursuit of global excellence, holding fast to our professionals are changing the world for the better – one tenets, traditions and values. Showing compassion for small act at a time. Please visit the Corporate Social our fellow man and respect for our planet are the Responsibility section of this report to learn about our cornerstones of these convictions. Tata Technologies is many endeavors over the past year.

Moving With Purpose Toward One To Win

The route spanning from the base of a mountain to its received long-awaited recognition; our Romanian and UK peak is rugged, oftentimes contains false summits, is delivery centers are on pace for substantial growth in the deceptive in distance, and is teeming with physical and coming years. mental obstacles. Transforming a business is very similar. Throughout our journey, while we have encountered To cap off the year, our global account management team impediments, our Company has also celebrated many returned record new, non-captive sales in the fourth hard-won milestones, several of which were achieved quarter. A strong finish to a watershed year; a hearty during FY14. Commemorating these achievements fuels jump-start for the next leg of our journey. With compass the passion we need to continue the climb. in hand and fixed on purpose, the adventure continues.

This year, our Senior Leadership Team scrutinized our products and services including the way in which we deliver them to market. This triggered internal change that was, at times, quite difficult. From replacing staff to rolling out newly packaged services, we confronted unchartered territory knowing quality work and intelligent decisions yield long-term rewards.

As our three-year journey to produce a premium vehicle comes to a close at the Paris Auto Show next fall, our collaboration with this iconic, global automaker is just beginning. Tata Technologies is well positioned to be the engineering service provider of choice for subsequent model-year changes and platform modifications. During FY14, the engineering capability of our Indian ODEC team

XXI Corporate Sustainability

Better for the planet. Better for people. Better for business. Better now. And better for the future.

Our ultimate purpose is long-term stakeholder value creation. In our pursuit of global excellence, HNO TEC LOG we must stay true to our tenets, our traditions and our heritage. We need to be conscious of the TA IE TA S effects our entrepreneurial activities have on the environment and go beyond regulatory safeguards, doing what is right to protect our planet. And we must have compassion for fellow human beings and help those less fortunate. We will continue to build on the strong community foundations we have created and leverage our managerial capabilities to ensure we bring innovation to our Corporate Social Responsibility (CSR) program, optimize its effectiveness, and create measurable impact for our Company.

“In doing so, we will have to carry along all our key stakeholders — employees, shareholders, suppliers, lenders, partners, communities we are present in, Governments — and do so in the sustainable Tata way.”

- Cyrus Mistry, Chairman, Tata Group

Corporate Sustainability Philosophy

Our vision is to make things better for the planet, better for people, better for business, better now and better for the future.

The mission of Tata Technologies’ Corporate Sustainability program is to positively impact the communities in which our company operates, and enhance the quality of life through commitment towards environmental stewardship, innovation in business and social development.

Our corporate sustainability framework consists of the overarching Tata Code of Conduct and the company’s corporate sustainability model (based on the Five Capitals approach for sustainable development and triple bottom- line principles of People, Planet, Profit) and the focus areas for Corporate Sustainability Programs. The Five Capitals model for sustainable development was developed by Forum for the Future. The model shows the relationship between resources and sustainable society & economy.

20th ANNUAL REPORT 2013 -14 XXII Corporate Sustainability Objectives

To make effective contributions to society and company stakeholders, the company has defined the following core focus areas of its CSR Program. • Fostering Innovation: Sustainable consumption and production patterns are critical today. The global financial crisis changed how businesses operate. Innovation has gained greater importance. The aim is to innovate, to achieve efficiency, and optimize resources and processes all while enhancing the environment and quality of experiences with and for our stakeholders. This will help to deliver solutions that are better for business today and in the future and appeal to a global audience. • Social Development: A quality education is essential for people to lead healthy and progressive lives. Therefore, human capital and community development are key focus areas. By adopting local initiatives, promoting education, and helping people develop vocational skills, we can enhance the quality of life for people within our organization and for those in less developed communities. • Enhancing the Environment: The threat of climate change demands action from all – government, people and industry. This means we must adopt the philosophy of reducing-reusing-recycling-replenishing-restoring-renewing natural capital to help our planet. This may be extended throughout our supply and delivery chain and neighboring communities to help create a positive footprint and ensure long-term sustainability. With consideration for Tata Technologies’ business and the CSR initiatives covered by Tata Group, Tata Technologies has shortlisted the following areas for its CSR initiatives under the triple bottom line (TBL):

PEOPLE Education (primary and secondary) Sustainable rural development projects

PLANET Ensuring environment sustainability for the community (Reduce, reuse, recycle, replenish, restore, renew)

PROGRESS Livelihood generation Vocational skills (for engineering curriculum) Technology incubation

The company will be streamlining all the activities conducted across all global operations to formulate a company- wide CS culture and integration in the coming financial year.

XXIII Regulations and Best Practices:

On February 27, 2014, the government of India took a step towards encouraging synergies between corporations and society for a better tomorrow by notifying the CSR Rules under section 135 of the Companies Act 2013. As per the CSR Rules which went into effect on April 1, 2014, every company, private limited or public limited, which either has a net worth of Rs. 500 crore or turnover of Rs. 1,000 crore or net profit of Rs. 5 crore, must spend at least 2 percent of its average net profit for the preceding three financial years on corporate social responsibility activities.

Tata Technologies Limited is an eligible company under this law for its Indian operations, and will therefore be amending its CSR policy to include the requirements of the said section. The community based activities that Tata Technologies is currently supporting are eligible activities as per the Schedule VII of the Companies Act 2013. Therefore, any of these activities implemented in India will be realized through the 2 percent allocated budget. Additionally, other global locations in South Asia, the U.S., Canada and Europe will continue to implement CSR initiatives through a separate local budget, which will be in addition to the 2 percent budget applicable to India. Tata Technologies has undertaken various initiatives under the triple bottom line for social and environmental benefit. Volunteering is also an integral part of being an employee of Tata Technologies.

Further to the community-focused initiatives, Tata Technologies is committed to sustainable business practices and has adopted international sustainability frameworks and best practices such as Dow Jones Sustainability Index (DJSI). In the first year, FY14, of DJSI application, the Company achieved a score of 49; the industry best score was 80. The Company is dedicated to implementing sustainable practices and guidelines to achieve social, environmental and economic efficiencies for a sustainable tomorrow.

Impact for FY 2013-14

20th ANNUAL REPORT 2013 -14 XXIV People

Tata Volunteering Week March 2014

On the day of Jamsetji Tata’s 175th Birthday all Tata Group companies participated in the Tata Volunteering Week to celebrate the Tata’s legacy of compassion and conduct all to uplift society. From across the globe, more that 1,800 volunteers from Tata Technologies registered on the Tata Engage website. Some of the activities included:

• Teaching students about various engineering concepts • Visiting a medical camp with students • Attending a national Robocon exhibition • Donating food • Planting trees • International Women’s Week celebrations • Reading to school children

UK Corporate Social Responsibility Programs

Throughout the year, employees in Coventry, UK, voluntarily participated in nine service-related and donation-based projects to help improve their surrounding communities. From slimming down to raise money for charity to raffling iPads for a children’s hospital, employees in the UK raised £3,463. Financial contributions and in-kind donations were made to various organizations such as Anesis Homeless Ministry, Macmillan Cancer Support, Acorn Children’s Hospital, and Cancer Research UK.

Asia-Pacific Blood Drive

Through this signature program, the Asia-Pacific Blood Drive,Tata Technologies professionals from Pune, Lucknow, Jamshedpur, Bangalore, India and Bangkok donated 862 units of blood.

Asia Donation Programs

Tata Technologies strives to fulfil basic and more pressing needs of disadvantaged and impoverished people. Throughout the year, Tata Technologies offices across the globe organize drives to collect items such as food, books, toys and clothes. In FY14, the total amount of non-perishable food donated was equal to Rs. 2,39,611 from Lucknow, Jamshedpur in India and Bangkok, Thailand. Donations of clothes and school kits in Sanand and Pune, equalled Rs. 2100, and 183 kilograms respectively. Additionally, 500 books were donated at Sanand, Bangalore and Pune.

XXV Flood Relief

In June 2013, flooding and landslides killed more than 5,000 people when a cloudburst devastated Uttarakhand in Northern India, affecting more than 4,000 villages. Through the generosity of individual employees and with a Company gift, Tata Technologies donated Rs. 32.90 lakhs to the recovery effort. Initiated by the Tata Group, the money will help fund construction of new infrastructure for water and other utilities as well as community programs in 10 villages.

Grace Centers of Hope

Tata Technologies continues its support of Grace Centers of Hope, the largest not-for-profit faith-based outreach center for the homeless and disadvantaged in Southeast Michigan, home of our North American headquarters. Tata Technologies organized the fourth annual “Running for Hope” team fund raiser. Tata Technologies employees voluntarily ran distances of 3 to 13 miles in the “Brooksie Way,” an annual fun-run in the Metro Detroit area. The fundraiser run and luncheon helped to raise nearly $1,400 for Grace Centers of Hope.

First Book

Armed with big smiles and open hearts, over the course of one week, 27 Tata Technologies employees read to students at Garfield Elementary School in Livonia, Michigan, a short distance from our Company’s North American headquarters. Tata Technologies partnered with First Book, a Washington D.C.-based organization that has distributed more than 100 million books and educational resources to low-income students. In addition to volunteering, the Tata Group donated $300 for the purchase of several different age- appropriate books for all the students who participated.

Bridge of Love in Romania

Cambric has been a financial support partner to Bridge of Love in Romania for over five years assisting that organization through out reach efforts, summer camps, and through provisions for medical/dental/vision supplies to Romania’s most vulnerable citizens; abandoned children and foster children.

CHOICE Humanitarian

CHOICE Humanitarian connects motivated villages in five different countries to resources and tools that allow villagers to transform their own lives. By building skills, capacities and leadership of the villagers, entire communities can break the cycle of poverty. Cambric employees has been intimately engaged with Choice through the supported building of a clean water systems in Guatemala and a self sustaining eco-school in Bolivia.

20th ANNUAL REPORT 2013 -14 XXVI Profit

Ready Engineer

Engineering technical education and talent development is a core agenda taken up by Tata Technologies. The Ready Engineer initiative aims to bridge the industry talent gap by helping to educate and mentor aspiring, young engineers. Meritorious third year engineering students in respective engineering streams who are chosen for the program complete 40 hours of classroom training by expert engineers supported by Tata Technologies’ online learning platform, iGETiT. During FY14, the Ready Engineer program partners with the following colleges where more than 400 students enrolled for the program. - SDM College of Technology in Dharwad, India - National Institute of Technology in Jamshedpur, India - College of Engineering, VIT, MIT and PVG at Pune, India - Coventry University in UK - ITT Technical Institute in the U.S. - National Polytechnic Institute (ESIME) in Mexico

In FY14, the program launched in Mexico and the U.S. In Mexico, 8th and 9th semester students participated in a 500-hour “Integral Project” or “Industrial Stay.” Student’s from Escuela Superior de IngenieriaMecanica y Electrica (ESIME) who participate in the program take part in either 400 to 600 hours of instruction or a full semester using the iGETiT online learning platform. In the U.S., five students were accepted into the inaugural Ready Engineer Co-Op Internship Program, which launched August 2013. Through real- world work experience and mentorship, the students learn engineering principles, deepen their educational experience and prepare for a career in engineering.

Square One

Tata Technologies partners with Square One Education Network, a nonprofit organization that aims to get high school students interested in careers in science, technology, engineering and math or STEM. Through active sponsorship and mentoring, Tata Technologies North America is exposing young people to creative and hands-on STEM projects. For the second year in a row, engineers and professionals are mentoring high school students from Detroit’s Frank Cody High School in an electric-vehicle build-off competition. Through several in-person guidance sessions with the students, Tata Technologies employees are helping their team race across the finish line at the May 2014 competition, which will be held at an official NASCAR raceway, Michigan International Speedway. Tata Technologies donated $5,000 to Square One’s efforts this year.

XXVII Environmental Stewardship

Tree Planting, Asia

Every year, Tata Technologies, takes a step to advance green initiatives by promoting the planting of trees for a healthier environment. With tree planting programs in Sanand, Lucknow, Jamshedpur and Pune, 79 employee volunteers planted approximately 110 trees.

The Heart of England Forest Project

Tata Technologies in the UK partners with the Heart of England Forest Project, a registered charity that plants, restores and protects trees. In addition to protecting and expanding the woodlands of England, the group supports environmental education for young people in the community. Over the last year, Tata Technologies sponsored a new woodland area and raised money enough to plant 2,115 trees.

E-waste Recycling

Under the environment stewardship, Tata Technologies promotes recycling of electronic items through collection and distribution to recyclers. In FY14, Pune and Bangalore alone recycled a total 374 kilograms of e-waste.

Water Conservation, Waste Management and Energy Efficiency

At Tata Technologies Pune, we are continuously conserving water through the sewage treatment plant, drip irrigation system and laundry practices. Through water conservation and recycling programs, approximately 28 percent of the water consumed or 75,000 litres of water per day were conserved. The organic waste compost treatment plant at the campus reprocesses 75 kilograms of solid waste per day into manure used to fertilize the gardens throughout the Pune campus.

Tata Technologies also continually monitors energy usage and promotes green infrastructure by optimizing natural light, using LED lights, and conducting employee seminars to develop greater environmental awareness.

20th ANNUAL REPORT 2013 -14 XXVIII ORS

shnan S Ramadorai R Gopalakrishnan Patrick McGoldrick P P Kad Chairman Director CEO & Managing Director Directo

Adi R i d Offi Ri &TfA THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK. Notice

NOTICE IS HEREBY GIVEN THAT THE TWENTIETH ANNUAL GENERAL MEETING OF THE MEMBERS OF TATA TECHNOLOGIES LIMITED will be held on Saturday, June 28, 2014 at 11:30 a.m. at the Registered Office of the Company situated at Plot No. 25, Rajiv Gandhi Infotech Park, Hinjawadi, Pune – 411057 to transact the following business:-

Ordinary Business

1. To receive, consider and adopt the Audited Financial Statements for the year ended March 31, 2014 together with Report of the Directors and Auditors thereon.

2. To declare final dividend and special dividend on Equity Shares.

3. To appoint a Director in place of Mr R Gopalakrishnan (DIN 00027858) who retires by rotation and is eligible for reappointment.

4. To appoint a Director in place of Mr C Ramakrishanan (DIN 00020076) who retires by rotation and is eligible for reappointment.

5. To appoint Auditors of the Company to hold office from the conclusion of this Meeting until the conclusion of the next Annual General Meeting of the Company and to authorize the Board of Directors to fix their remuneration. M/s Deloitte Haskins & Sells LLP, Chartered Accountants (ICAI Firm Registration No. 117366W) (LLP Registration No. W-100018), the retiring Auditors are eligible for reappointment.

Special Business

6. Appointment of Mr Warren Harris as a Director of the Company

To consider and, if thought fit, to pass with or without modification, the following resolution as an Ordinary Resolution:-

“RESOLVED THAT Mr Warren Harris (DIN 02098548) in respect of whom the Company has received a notice in writing under Section 160 of the Companies Act, 2013 from a member proposing his candidature for the office of director, be and is hereby oppointed as a Director of the Company, liable to retire by rotation."

7. Borrowings

To consider and, if thought fit, to pass with or without modification, the following resolution as a Special Resolution:

“RESOLVED THAT pursuant to Section 180(1)(c) and any other applicable provisions of the Companies Act, 2013 and the rules made thereunder (including any statutory modification(s) or re-enactment thereof for the time being in force), the consent of the Company be and is hereby accorded to the Board of Directors of the Company (hereinafter referred to as the "Board", which term shall include and Committee thereof) for borrowing from time to time, any sum or sums of money for the purpose of the Company upon such terms and conditions and with or without security as the Board may at its discretion think fit so, in excess of the aggregate of the paid-up share capital and free reserves of the Company, provided that the total amount of such borrowing and outstanding at any point of time, apart from temporary loans obtained/to be obtained from the Company's Bankers in the ordinary course of business shall not exceed ` 75 crore (Rupees Seventy five crore only) over and above the aggregate of the paid-up capital and free reserves of the Company.”

8. Grant of Loan to Tata Technologies Limited Employees Stock Option Trust

To consider and, if thought fit, to pass with or without modification, the following resolution as a Special Resolution:

“RESOLVED THAT pursuant to the provisions of Section 67 of the Companies Act, 2013 read with Rule 16(1) of the Companies (Share Capital and Debentures) Rules, 2014, and any other applicable law for the time being in force consent and approval of the Company be and is hereby granted to the Board of Directors of the Company (hereinafter referred to as ”the Board” which term shall be deemed to include any Committee including the Nomination & Remuneration Committee) for grant of loan not exceeding ` 36 crore (Rupees Thirty Six crore only) at any time to Tata Technologies Limited Employees Stock Option Trust for the purpose of purchase of shares.”

20th ANNUAL REPORT 2013 - 14 1 “RESOLVED FURTHER THAT for the purpose of giving effect to the above, the Board and/or the Nomination & Remuneration Committee of the Board be and are hereby authorized on behalf of the Company to do all such acts, deeds, matters and things as it may, deem fit, necessary, desirable, expedient or proper for such purpose.”

Notes:

1. The Statement pursuant to Section 102 (1) of the Companies Act, 2013 with respect to the special business set out in the Notice is annexed.

2. A MEMBER ENTITLED TO ATTEND AND VOTE IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE INSTEAD OF HIMSELF AND THE PROXY NEED NOT BE A MEMBER.

3. The Proxy form as per the format enclosed in the Annual Report should be duly filled, stamped, signed and received by the Company at its Registered Office not less than 48 hours before the time for holding the meeting.

4. Members/proxies should bring duly-filled Attendance Slip sent enclosed herewith to attend the meeting.

5. The Register of Directors' and Key Managerial Personnel Shareholding maintained under Section 170 of the Companies Act, 2013, will be available for inspection by the members at the AGM.

6. The Register of Contracts, maintained under Section 189 of the Companies Act, 2013, will be available for inspection by the members at the AGM.

7. The Register of Members and the Transfer Books of the Company will be closed from Friday, June 13, 2014 to Friday, June 20, 2014, both days inclusive.

8. Subject to the provisions of the Companies Act, 2013, dividend as recommended by the Board of Directors, if declared at the meeting, will be paid within a period of 30 days from the date of declaration, to those members whose names appear on the Register of Members as on June 12, 2014.

9. As per the provisions of the Companies Act, 2013, facility for making nominations is available for Members in respect of shares held by them. Nomination Forms can be obtained from the Company's Registrar and Transfer Agent.

10. Members may please note the contact details of the Company's Registrar and Transfer Agent, M/s TSR Darashaw Private Limited, as follows:

TSR Darashaw Private Limited 6-10 Haji Moosa Patrawala Industrial Estate, 20, Dr.E.Moses Road, Mahalaxmi, Mumbai-400011 Tel:+91 22 66568484 Fax:+91 22 66568494 Email:[email protected] Website:www.tsrdarashaw.com

11. Members holding shares in dematerialized form are requested to intimate all changes pertaining to their bank details, mandates, nominations, change of address, change of name, change in email id etc., to their Depository Participants. Changes intimated to the Depository Participants will be then automatically reflected in the Company's records which will help the Company's Registrar and Transfer Agent to provide efficient and better services. Members holding shares in physical form are requested to intimate such changes to the Company's Registrar and Transfer Agent.

12. The Company has received a unique user code from Reserve Bank of India to credit the dividend directly to the bank accounts of the Investors. Members, who intend to opt the ECS facility, are requested to fill in the ECS Request Form attached at the end of this Report and send to the Company's Registrar and Transfer Agent. Members holding the shares in electronic form are requested to contact their Depository Participants and give suitable instructions to record their bank account details in their demat account.

13. Members attention is particularly drawn to the 'Transfer of Unclaimed/Unpaid dividends to Investor Education and Protection Fund' section under 'General Shareholder Information' in the Corporate Governance Report.

14. The Company has dematerialized its Equity Shares to CDSL & NSDL and Company's ISIN number is INE142M01017. Members, who hold shares in physical form, are requested to dematerialize their shares. A detailed FAQ on Dematerialization is provided elsewhere in the Annual Report.

15. In accordance with sub-section (1) of Section 101, of the Companies Act, 2013, a company may give notice

2 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION through electronic mode. The Company is concerned about the environment and utilizes natural resources in a sustainable way. Members are requested to register their email address, through written application, with Company's Registrar and Transfer Agents to enable the Company to send notices, annual reports and other communication via email.

16. Voting through electronic means

I. According to Section 108 of Companies Act, 2013, read with Rule 20 of Companies (Management and Administration) Rules, 2014 e-voting is mandatory for all listed Companies or Companies having Shareholders not less than one thousand.

II. In compliance with provisions of Section 108 of the Companies Act, 2013 and Rule 20 of the Companies (Management and Administration) Rules, 2014, the Company is pleased to provide members facility to exercise their right to vote at the Annual General Meeting (AGM) by electronic means and the business may be transacted through e-Voting Services provided by National Securities Depository Limited (NSDL).

III. A member may exercise his vote at any general meeting by electronic means and company may pass any resolution by electronic voting system in accordance with the Rule 20 of the Companies (Management and Administration) Rules, 2014.

IV. During the e-voting period, members of the Company, holding shares either in physical form or dematerialized form, as on a fixed date, may cast their vote electronically.

V. In case a Member receives an email from NSDL [for members whose email IDs are registered with the Company/Depository Participants(s)]:

(i) Open email and open PDF file. The said PDF file contains your user ID and password/PIN for e-voting. Please note that the password is an initial password.

(ii) Launch internet browser by typing the following URL: https://www.evoting.nsdl.com/

(iii) Click on Shareholder – Login

(iv) Put user ID and password as initial password/PIN noted in step (i) above. Click Login.

(v) Password change menu appears. Change the password/PIN with new password of your choice with minimum 8 digits/characters or combination thereof. Note new password. It is strongly recommended not to share your password with any other person and take utmost care to keep your password confidential.

(vi) Home page of e-voting opens. Click on e-Voting: Active Voting Cycles.

(vii) Select “EVEN” of Tata Technologies Limited.

(viii) Now you are ready for e-voting as Cast Vote page opens.

(ix) Cast your vote by selecting appropriate option and click on “Submit” and also “Confirm” when prompted.

(x) Upon confirmation, the message “Vote cast successfully” will be displayed.

(xi) Once you have voted on the resolution, you will not be allowed to modify your vote.

(xii) Institutional shareholders (i.e. other than individuals, HUF, NRI etc.) are required to send scanned copy (PDF/JPG Format) of the relevant Board Resolution/ Authority letter etc. together with attested specimen signature of the duly authorized signatory(ies) who are authorized to vote, to the Scrutinizer through e-mail [email protected] with a copy marked to [email protected].

(xiii) In case of any queries, you may refer the Frequently Asked Questions (FAQs) for Shareholders and e-Voting user manual for Shareholders available at the Downloads section of www.evoting.nsdl.com.

(xiv) If you are already registered with NSDL for e-voting then you can use your existing user-Id and password for casting your vote.

VI. The e-voting period commences on June 22, 2014 (10:00 am) and ends on June 24, 2014 (5:00 pm). During this period shareholders' of the Company, holding shares either in physical form or in dematerialized form, as on the cut-off date of i.e. Friday, June 13, 2014, may cast their vote electronically. The e-Voting module

20th ANNUAL REPORT 2013 - 14 3 shall also be disabled by NSDL for voting thereafter. Once the vote on a resolution is casted by the shareholder, the shareholder will not be allowed to change it subsequently.

VII. The voting rights of Shareholders shall be in proportion to their shares of the paid up equity share capital of the Company as on Friday, June 13, 2014.

VIII. Since the Company is required to provide facility to the members to exercise their right to vote by electronic means, shareholders of the Company, holding shares either in physical form or in dematerialized form, as on Friday, June 13, 2014 and not casting their vote electronically, may cast their vote at the Annual General Meeting.

IX. Mr Umesh Maskeri, has been appointed as the Scrutinizer to scrutinize the e-voting process in a fair and transparent manner.

X. The Scrutinizer shall within a period not exceeding three(3) working days from the conclusion of the e-voting period unblock the votes in the presence of at least two(2) witnesses not in the employment of the Company and make a Scrutinizer's Report of the votes cast in favour or against, if any, forthwith to the Chairman of the Company.

XI. The Results shall be declared on or after the AGM of the Company. The Results declared alongwith the Scrutinizer's Report shall be placed on the Company's website www.tatatechnologies.com and on the website of NSDL within two(2) days of passing of the resolutions at the AGM of the Company.

Date: May 15, 2014 Place: Mumbai By Order of the Board of Directors

Registered Office: Anubhav Kapoor 25, Rajiv Gandhi Infotech Park, General Counsel and Company Secretary Hinjawadi, Pune – 411 057

4 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION EXPLANATORY STATEMENT PURSUANT TO SECTION 102(1) OF THE COMPANIES ACT, 2013

The following Explanatory Statement pursuant to Section 102(1) of the Companies Act, 2013 (the Act), sets out all material facts relating to the Special Business mentioned in the accompanying Notice and should be taken as forming part of the Notice.

Item No 6

Mr Warren Harris, 51, holds a Bachelor of Engineering Degree (Honors), earned in 1986 from the University of Wales Institute of Science and Technology. He is a member of the Institute of Mechanical Engineers and is a Chartered Engineer. In October 2011, Mr Harris graduated from the Harvard Business School Advanced Management Program. Mr Harris has been with the current Tata Technologies organization for more than 22 years and is currently the President & Global Chief Operating Officer of the Company. His roles have evolved from engineer to a number of technical management positions worldwide.

Mr Harris also Chairs the Tata Network Forum in North America and is on the Board of Directors of Tata HAL Technologies Limited , a joint venture of Hindustan Aeronautics Limited and Tata Technologies Limited.

Mr Warren Harris (DIN 02098548) was appointed as an Additional Director pursuant to Section 161 of the Companies Act, 2013, on the Board of the Company w.e.f. May 15, 2014. Pursuant to the provisions of the said Section, he holds office upto the date of ensuing Annual General Meeting of the Company.

The Company has received a notice under Section 160 of the Companies Act, 2013 proposing the candidature of Mr. Warren Harris for the office of the Director along with ` 1 lac, under the provisions of Section 160 of the Companies Act, 2013.

None of the Directors of the Company or Key Managerial Personnel or their relatives, are in any way concerned or interested, financially or otherwise in this resolution except to the extent of their share holding in the Company.

The Board of Directors recommends the resolution set out in Item no. 6 of the accompanying Notice for approval of the Members.

Item No 7

Under Section 180(1)(c) of the Companies Act, 2013, the Board of Directors of a Company cannot except with the consent of the Company in the Annual General Meeting, borrow monies, apart from temporary loans obtained from the Company's bankers in the ordinary course of business, in excess of the aggregate of the paid-up share capital and free reserves of the Company.

Section 180(1)(c) is the corresponding section to Section 293(1)(d) of the Companies Act, 1956.

Members in the Annual General Meeting held on September 30, 1997 had approved borrowings up to a limit not exceeding ` 50 crore (Rupees fifty crore) under Section 293(1)(d) of the Companies Act, 1956 and subsequently in the Annual General Meeting on July 10, 2003 increased the same by ` 25 crore (Rupees twenty crore), totaling it to ` 75 crore (Rupees seventy five crore) over and above the aggregate of the paid up capital and free reserves.

The Ministry of Corporate Affairs vide a General Circular No 04/2014 dated March 25, 2014, has clarified that the applicability of Section 180 of the Companies Act, 2013. As per the circular, resolution passed by the shareholders under Section 293(1)(d) of the Companies Act, 1956, will be valid till one year from the notification of Section 180 of the Companies Act, 2013.

The Ministry has already notified the Section 180 of the Companies Act, 2013.

Considering the requirements of the funds in future, the Board of Directors deem fit it necessary to borrow funds from banks, financial institutions or any other lending institutions or persons on such terms and conditions as may be considered suitable by the Board of Directors, a limit not exceeding in the aggregate of ` 75 crore (Rupees seventy five crore) over and above the aggregate of the paid up capital and free reserves.

None of the Directors of the Company or Key Managerial Personnel or their relatives, are in any way concerned or interested, financially or otherwise in this resolution except to the extent of their share holding in the Company.

The Board of Directors recommends the resolution set out in Item no. 8 of the accompanying Notice for approval of the Members.

Item No 8

To manage and implement various stock based incentive programs for employees of the Company, the Company has

20th ANNUAL REPORT 2013 - 14 5 formed a Tata Technologies Limited Employees Stock Option Trust (TTESOP Trust) for employees of the Company.

To purchase shares of the Company, the Board of Directors in its meeting held on January 23, 2008, had approved an unsecured loan not exceeding ` 14.55 (Rupees Fourteen crore fifty five lacs) to the TTESOP Trust. TTESOP Trust has availed a loan of ` 50,744,966.19 from the Company till March 31, 2014.

In accordance of the provision of Rule 16(1) of the Companies (Share Capital and Debentures) Rules, 2014 the company shall not make a provision of money for the purchase of, or subscription for, shares in the company or its holding company, if the purchase of, or the subscription for, the shares by trustees is for the shares to be held by or for the benefit of the employees of the company, unless it complies with the following conditions, namely:-

(a) the scheme of provision of money for purchase of or subscription for the shares as aforesaid is approved by the members by passing special resolution in a general meeting;

(b) where shares of a company are not listed on a recognized stock exchange, the valuation at which shares are to be purchased shall be made by a registered valuer;

(c) the value of shares to be purchased or subscribed in the aggregate together with the money provided by the company shall not exceed five per cent of the aggregate of paid up capital and free reserves of the company;

None of the Directors of the Company or Key Managerial Personnel or their relatives, are in any way concerned or interested, financially or otherwise in this resolution except to the extent of their share holding in the Company.

The Board of Directors therefore recommends the resolution set out in Item no.8 of the accompanying Notice for approval of the Members.

6 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Directors’ Report

TO THE MEMBERS OF TATA TECHNOLOGIES LIMITED

The Directors are pleased to present their Twentieth Annual Report on the Business and Operations of your Company and the Audited Statement of Accounts for the year ended March 31, 2014.

1. FINANCIAL RESULTS

The summary of financial results of the Company for the year ended March 31, 2014 is as follows:

(Amount in ` Crore)

Particulars 2013-14 2012 -13

Income from Operations 886.18 774.70 Other Income 43.16 43.33 Total Income 929.34 818.03 Operating Expenditure 632.46 527.35 Profit before Depreciation, Interest and Taxes 296.88 290.68 Interest 1.43 1.62 Depreciation 36.15 27.02 Profit/(Loss) before Taxes 259.30 262.04 Provision for taxes 56.58 60.82 Profit/(Loss) after Taxes 202.72 201.22 Balance brought forward from previous year 221.98 166.73 Amount available for appropriations 424.70 367.95 APPROPRIATIONS Interim Divided 51.64 38.69 Proposed Final Dividend 77.44 68.84 Tax on Interim/Proposed Dividend 22.46 17.45 General Reserve 21.00 21.00 Balance carried to Balance Sheet 252.16 221.98

2. REVIEW OF BUSINESS OPERATIONS

The Company recorded an overall revenue growth of approximately 13.61% with an increase of approximately 14.39% in revenue from sale of products and services, from ` 774.70 crore in 2012-13 to ` 886.18 crore in 2013-14. Due to efficient cost management, increased focus on operating efficiencies and offshoring, the operating profit registered an increase of approximately 2.13% over the last year, while profit before taxes (PBT), reduced at a rate of approximately 1.05% on a year-on year basis. Profit after taxes (PAT) grew by approximately 0.75% during the same period. During the period, services revenue increased by 13.60% and product sale increased by 19.42% over last year to reach figures of ` 762.89 crore and ` 122.12 crore respectively. Services revenue comprises:

1. Engineering Automation Group [EAG]: EAG addresses the engineering and design needs of manufacturers through services for all stages of the product development and manufacturing process.

2. Enterprise Solutions Group [ESG]: ESG addresses the Information Technology needs of manufacturers including business solutions, strategic consulting, ERP implementation, systems integration, IT networking and infrastructure solutions and program management.

3. Product Lifecycle Management [PLM]: PLM addresses the product development technology solution requirements of manufacturers including end-to-end implementation of PLM technology, best practices and PLM consulting. PLM also includes the Company's proprietary applications iGETIT® and iCHECKIT®.

20th ANNUAL REPORT 2013 - 14 7 3. DIVIDEND

The Board declared an interim dividend of ` 3/- per share in the first two quarters and ` 6/- per share in the third quarter of the financial year 2013-14 totaling to ` 12/- per share. Considering the financial performance, the Board recommends a further dividend of ` 13/- per share and a special dividend of ` 5/- per share.

If the shareholders approve the proposed final dividend and a special dividend at the ensuing Annual General Meeting, the total dividend for the financial year 2013-14 will be ` 30/- per share. The total dividend for the financial year 2012-13 was ` 25/- per share.

4. BUSINESS OUTLOOK

Your Company is highly focused on delivery of value to its customers, marketing and sales and as such, it is seeing improved order bookings. The Company expects improved growth in revenue, EBITDA and profit after tax in the coming years. Please refer the section on Management Discussion and Analysis for more information.

5. CHANGES IN SHARE CAPITAL

During the year, the following changes have occurred in the authorized and the paid-up equity share capital of the Company:

a) The authorized share capital of the Company remained unchanged at ` 60.70 crore divided into 6,00,00,000 equity shares of ` 10/- each and 7,00,000 0.01% cumulative non-participative compulsorily convertible preference shares of ` 10/- each.

b) 600 equity shares were allotted on exercise of the employees stock options during the year. Hence, the paid up capital of the Company increased from ` 43,02,35,380 to ` 43,02,41,380.

The Company is committed to employee participation in the stocks of the Company and has promoted and implemented various stock based incentive and ownership schemes from time to time. The details for the last year are provided in Annexure I to this report.

6. HUMAN RESOURCE DEVELOPMENT

The Company employs 7020 permanent and contractual professionals, as on March 31, 2014. The corresponding total employee strength as on March 31, 2013 was 6291. This registered an increase in employee strength by 11% during the financial year 2013-14. Our employees serve clients across the globe in Automotive, Aerospace, Construction and Heavy Engineering domains spread over in 25 countries. The Company's strategy is to deploy a judicious mix of specialists from our key bases in India, North America and UK and local talent from the countries the Company is operating in. This ensures seamless engagement with our customers, through clear understanding of local cultures for the provision of specialized solutions.

The section on Human Capital under the Management & Discussion Analysis Report provides details on our approach and initiatives on human resources.

7. CORPORATE SUSTAINABILITY

The Company is committed to make positive contributions to society, the economy and the environment through its products, employment practices, community involvement and responsible resource use. Globally, many associates of Tata Technologies volunteer in support of various programs organized to make a positive impact on society.

With the introduction of the new Companies Act, 2013 in India, the Company is eligible to fulfill the requirements of the CSR Rules under Section 135 of the Act, w.e.f. April 01, 2014. The CSR activities in India will be reported as per the guidelines specified by Section 135 of the Companies Act, 2013 from FY14 -15 onwards. Furthermore, the Company will continue to work on sustainability initiatives globally and report all CS activities in addition to the regulatory requirement.

The shareholders are advised to refer the separate section on the Corporate Sustainability in this report for more details.

8. QUALITY INITIATIVES

One of the primary requisites for many of the Company's customers to engage with the Company is that the Company is certified to globally recognized Quality standards such as ISO 9001:2008, AS 9100 C and

8 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION ISO 27001:2005 by Dekra (The Netherlands and USA). As the Company's Quality Management System (QMS) and Information Security Management System (ISMS) meet stringent requirements laid out by these quality standards, customers are assured of consistent quality of service and predictable outcome while ensuring security of information.

All the major delivery centers are certified to relevant quality standards. While the delivery centers in Hinjewadi (Pune), Bangalore, Thailand and Blue Ridge (Hinjewadi, Pune) were already certified, projects managed by the Company in Tata Motors was included in the last year.

The core operational processes of delivery are established in Global Engagement Model (GEM) which is the methodology for project management in the Company. It has been IT enabled through a project management tool. The result is GEM-iT Key quality metrics are tracked through this system and provides management a view of different Lines of Business (LoBs), Verticals and Projects within. New “project management kits” have been established for the verticals to which the QMS was extended last year.

Process groups made up of domain experts with eight to fifteen years' experience work closely with the Global Quality team to continuously improve the QMS processes and related IT tools.

A team of over two hundred trained and certified internal quality auditors ensure a high level of compliance to the organization's processes. They also contribute towards process improvement resulting from findings of internal audits.

The Company has taken up Knowledge Management initiative to strengthen Project Deliveries. The Company has developed dedicated knowledge management application which will help centralized repository of delivery wide knowledge of domain, tools & skills. The Company is actively promoting knowledge sharing culture by holding workshops, knowledge sharing sessions & trainings, technical seminars. The employees are rewarded on regular basis for their contribution to build knowledge building & sharing culture.

9. INFORMATION TECHNOLOGY (IT) INITIATIVES

The Company continues to leverage IT to enable its strategic journey. The focus of the IT initiatives was directed to enable efficiencies and scalability across its customers, employees and suppliers while further integrating its operations across the major territories. The Company adopts the IT Infrastructure Library (ITIL) as its Service Delivery Framework. An IT Steering Committee helps govern and prioritize requirements across all parts of its business while ensuring return of its IT investments.

Tata Technologies IT investments and operations were focused across its key areas of (a) Infrastructure & Operations (b) Enterprise Applications (c) Engineering Systems & Customer Collaboration and (d) Information Security Management System (ISMS). Key highlights of each of these areas are listed below. The Company initiated IT integration of its recent acquisition- Cambric Corporation – to both leverage synergies while incorporating key best practices to help the integrated organization.

In keeping with its “Practice What We Preach” philosophy, the Company continues to internally leverage technologies it deploys to its manufacturing customers such as SAP, NetApp, Riverbed, Siemens, Dassault and Qlikview. Each of these technologies have been enhanced with internally developed IP/ implementation best practices and the resulting solutions leveraged across its manufacturing customers globally. Examples of these include WAN Optimization, Engineering Resource Optimization, Infrastructure Management, Dashboarding/Analytics & Human Capital Management. IT leaders participated in events & awards in the industry across the IT and Security domain areas.

The Company continued to focus on the Governance & Risk Management to help scale the business, deploying a GRMC framework to track and manage compliance checks & risks. The Company leveraged its Internal Audit process to periodically assess its IT systems, processes and governance and improve associated areas of improvement.

Infrastructure & Operations:

Select focus for this category are listed below:

a) Reducing operating costs through IT consolidation using Virtualization / HPC technologies b) Improving End User performance leveraging APM & Uptime solutions c) Reducing risks by implementing BCP across select delivery locations d) Increasing customer confidence through ISO 27001 recertification @ Global Delivery Centers e) Reducing operating costs leveraging VOIP, Telco Cost Analysis implementations f) Improving employee productivity by improving IT Service Desk SLAs

20th ANNUAL REPORT 2013 - 14 9 The Company upgraded its communication infrastructure with its key customers Jaguar Land Rover, Chrysler and Tata Motors to help efficient service delivery. IT team worked closely with the Company's sales, to win businesses in the area of infrastructure management services from its manufacturing customers and thus anchored in winning ESG and PLM businesses. The Company helped its joint venture company Tata HAL to setup state of the art IT infrastructure and security systems at their Bengaluru facility.

Enterprise Applications:

Select focus areas this category are listed below:

a) Continuous improvement of employee productivity through HCM (SAP ESS) improvements b) Helping customer acquisition through CRM improvements with Sales War Room analytics c) Support large services opportunities through CRM Services Engagement tracking capabilities d) Improving pipeline by Integrating Demand Generation & Optimizing Marketing Effectiveness e) Integrating cross-channel, content and social marketing with Marketing Automation f) Strengthening controls for improved analysis of Customer Time Booking/ Billing processes g) Improving new employee experience & productivity by streamlining Onboarding activities h) Ongoing performance management with Analytics across Travel / Procurement costs i) Streamlining planning, budgeting & forecasting processes using SAP BPC Framework

The Company continued to mature its enterprises processes & application deployments across major process areas (Hire 2 Retire, Deal 2 Delivery, Opportunity 2 Order, Billing & Finance and Dashboarding & Analytics). Across the Hire 2 Retire process areas: SAP Employee Self Services & Performance Appraisal / Competency Enhancement based processes (e.g. Travel, Employee Movement, Claims, Separation, PACE) were enhanced with an increasing focus on Process Analytics and improvements. For the Deal 2 Delivery process areas: Delivery Project Execution & Control, Project Customer Satisfaction Processes were enhanced leveraging the Global Engagement Model (GEM) platform. Skills Management systems and Time Booking systems were also enhanced to help meet the increased requirements. Across the Opportunity 2 Order process areas: The Sales War Room Analytics, CRM enhancements for Services Approvals and Monthly Flash Reports were launched as part of the SPEED PMO Sales transformation initiative. In the area of Billing & Finance: An SAP based solution is being developed to streamline the Planning, Budgeting & Forecasting activities globally. Each of the above process areas were further supported by leveraging analytics to both improve process efficiency while also improving the underlying data integrity across all enterprise systems.

Engineering Systems & Customer Collaboration:

Select focus areas for this category are listed below:

a) Partnering with Anchor Customers to deploy PLM/ Supplier Collaboration environments b) Improve performance of Customer ODC's Design environments across TTL Delivery Centers c) Implementing standard data transfer solutions across each of TTL Delivery Centers d) Streamline Ramp-up for new Customer ODCs (Eng Procurement, Licenses and Hardware) e) Improve Design & Data collaboration capabilities with customers leveraging next-gen tools

The Company assessed and improved design (CAD/CAE) collaboration efficiencies for one of its Anchor Automotive customers with its UK & India delivery centers to prepare for its next generation product development programs. The Company also expanded its Engineering Resource Optimization value proposition – leveraging it across key customers and enhancing it through ongoing assessments from external agencies. Each of these initiatives are aimed at quickly ramping up / down customer Offshore Delivery Centers across the globe while continuing to improve the design productivity yearly.

Information Security Management System (ISMS) Operations:

The Company completed many external and internal security assessments as part of its new customer acquisition/existing projects governance process. Security controls such as web filtering, antivirus protection, visitor management systems and CCTV monitoring were enhanced as part of ongoing updates. The Company recertified its ISO 27001 Security Certification across its key delivery centers as part of an ongoing commitment towards data security and compliance.

10 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION 10. SUBSIDIARY COMPANIES AND JOINT VENTURE

The Company had 17 subsidiary companies as on March 31, 2014.

Asia Pacific

North America Tata Technologies Ltd (India) Europe 100% Tata Technologies Pte Ltd. (Singapore) 100% 100% 99.24% 100% Cambric Tata Manufactruring INCAT international Plc Technologies Technlogies Tata Technologies Inc (UK) (Thailand) Ltd (Shanghai)Co., Ltd (US) (Thailand) (China)

100% Tata Technologies Europe Ltd 100% 100% 100% (UK) Tata Technologies Cambric Holding Inc Tata Technologies 100% de Mexico, S.A. de C.V. (US) (Canada)Inc, INCAT GmbH (Mexico) Canada (Germany) 100% CambricCorporation (US)

99.96% 100% 100% 100% 100% Cambric LImited Cambric UK Cambric Managed Cambric GmbH Midwest Managed (Bahamas) Limited (UK) Services Inc (US) (Germany) Services (US) 100% Cambric Consulting SRC (Romania)

Consolidated Results: In accordance with the Statement of Accounting Standard on Consolidated Financial Statements (AS 21) issued by the Institute of Chartered Accountants of India (ICAI), subsidiaries of the Company and 50% share in Joint Venture Company have been considered in the Consolidated Financial Statements of the Company, attached in separate section of this report. As may be seen from the consolidated statements, the consolidated revenue was ` 2,394.73 crore, an increase of 17.08% against ` 2,045.42 crore in the previous year. The profit before tax was ` 337.57 crore as against ` 392.43 crore in the previous year, recording a reduction of 13.98%. The profit after tax stood at ` 273.22 crore as against ` 300.73 crore recording a reduction of 9.15%.

The Services/Products business mix was a 77/23 split respectively (` 1,799.21 crore for services and ` 542.35 crore for products) compared to FY 2013 when the Company recorded ` 1,511.64 crore for services and ` 476.39 crore for product or a 76/24 mix. The Americas produced ` 743.69 crore with Asia Pacific recording ` 972.88 crore and Europe generating ` 960.38 crore. The three territories combined produced ` 2,394.73 crore top line after reducing inter-company billing, in FY 2014 compared to ` 2,045.42 crore for FY 2013.

Joint Venture: Tata HAL Technologies Limited is a 50:50 joint venture between Tata Technologies Limited and Hindustan Aeronautics Limited (HAL), with its corporate office situated at Bangalore, Karnataka. Tata HAL Technologies Limited is in the business of providing engineering and design solutions and services in the domain of aerostructures for the aerospace industry. The company reported revenue of ` 9.32 crore for the FY 2013-2014 as against the revenue of ` 5.64 crore in FY 2012-13 an increase of 65.20% over the last year. The loss for the year was ` 1.56 crore as against profit of ` 0.24 crore in FY 2012-13. Considering the tax losses of the Company, no provision for tax has been made in the books of account.

During the year, the Board of Directors reviewed the affairs of the subsidiary companies. As per Section 212 of the Companies Act, 1956, the Company is required to attach the Balance Sheet, Statement of Profit and Loss and other documents of its subsidiaries. The Ministry of Corporate Affairs, Government of India vide its Circular No. 2/2011 dated February 8, 2011, exempted companies from complying with Section 212, provided such companies publish the audited consolidated financial statements in the Annual Report. The Company has published the audited consolidated financial statements for the fiscal year 2014 and the same forms part of this Annual Report. Accordingly, this Annual Report does not contain the financial statements of its subsidiaries. The Statement pursuant to Section 212 of the Companies Act, 1956, highlighting the summary of the financial performance of our subsidiaries is annexed to this report.

The audited financial statements and related information of subsidiaries are available on the Company's website, www.tatatechnologies.com. These documents will also be available for inspection during business hours at our registered office in Pune, India

20th ANNUAL REPORT 2013 - 14 11 11. DIRECTORS

In accordance with the requirements of the Companies Act, 2013 and the Articles of Association, Mr R Gopalakrishnan (DIN 00027858) and Mr C Ramakrishnan (DIN 00020076) are liable to retire by rotation and eligible to offer themselves for reappointment.

Mr Warren Harris (DIN 02098548) was appointed on the Board as an Additional Director of the Company w. e. f. May 15, 2014.

On CEO succession planning, t he Shareholders are advised to refer to the 'Letter to share holders' in this report.

12. STATUTORY AUDITORS

M/s Deloitte Haskins & Sells LLP, Chartered Accountants (ICAI Firm Registration No. 117366W) (LLP Registration No: W-100018), the Company's Statutory Auditors, hold office until the conclusion of the ensuing Annual General Meeting. It is proposed to reappoint them to examine and audit the accounts of the Company for the financial year 2014-15. M/s Deloitte Haskins & Sells LLP, have pursuant to Section 139(1) of the Companies Act, 2013, furnished the relevant letter confirming their eligibility and willingness for reappointment as the Statutory Auditors, should they be so appointed.

The members are requested to appoint Auditors for the current year and authorize the Board of Directors to fix their remuneration.

13. INTERNAL AUDITORS

The Company has appointed M/s Ernst & Young LLP, as Internal Auditors of the Company, to conduct the Internal Audit of the Company and its subsidiaries.

14. COMPLIANCE AUDITORS

To strengthen the compliance process of the Company, the Company has implemented system based compliance tool known as “iComply” in India, Europe, Thailand and Singapore. The Company has appointed M/s Ernst & Young LLP, as Compliance Auditors of the Company, to conduct the Compliance Audit at all locations where the iComply tool has been implemented.

15. PUBLIC DEPOSITS

The Company has not accepted any deposits from the public in terms of Section 58A and/or Section 58AA of the Companies Act, 1956 during the year under review. And hence, no amount is outstanding under the head Public Deposits as on March 31, 2014.

16. PARTICULARS OF EMPLOYEES

A statement containing the name and other particulars of employees of the Company as required under Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1957 is given as Annexure II to this Report.

17. MANAGEMENT DISCUSSION AND ANALYSIS

The shareholders are advised to refer the separate section on the Management Discussion and Analysis in this report.

18. CORPORATE GOVERNANCE REPORT

The shareholders are advised to refer the separate section on Corporate Governance in this Report.

19. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Conservation of Energy: The operations carried out by the Company in all of its locations are such that they are not deemed as energy intensive. However, the Company constantly makes efforts to avoid excessive consumption of energy. Measures were taken to increase awareness about the need to conserve power and water. At the Hinjawadi delivery center, solar water heaters are installed in the Guest House and the Wellness Centre. The schedule of switching on/off lights and AHU's was monitored continuously keeping in mind factors of climate, availability of power and working hours. LED lights are being considered as a replacement for CFL wherever possible in all new facilities. The Company remains committed to deploying more efficient energy saving measures. New technologies/options are regularly monitored and efforts will continue to conserve energy.

12 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Technology Absorption: The Company has been investing in strategic technologies aligned with its business goals and customer needs, resulting in prudent investment in state-of-the-art software and hardware technology while delivering solution and service to all internal and external stakeholders.

Private Cloud - Bringing HPC technology to Business Applications: The Company has implemented a highly available, virtualized and scalable cluster of high performance new generation servers. It has multiple applications serving internal business needs, catering to all employees and related processes, as well as requirements for hosting applications for its existing and potential customers. The Private Cloud is built on the latest hardware platform, containing elements of proven High Performance Computing Technology, with the virtualization layer supported by high performance ZFS storage. This virtualized layer caters to various applications used by employees, like mail servers, Document Management System, Intranet applications, etc., thereby reducing total cost of ownership and providing better user experience.

Mobility: The Company has also initiated deployment and use of iOS based devices for senior management. As part of the initiative, the Company has implemented the delivery and deployment environment for Enterprise Mobile Applications. It also released few applications for its employees through its own managed app-store.

Foreign Exchange Earnings and Outgo: Information pertaining to the foreign exchange earnings and outgo during the year under review, in terms of the Notification 1029 of 31-12-1988 issued by the Department of Company Affairs is as follows:

(Amount in ` Crore)

Particulars 2013- 14 2012 - 13

Earnings in foreign currency 256.44 225.98 Expenditure in foreign currency 45.64 40.20

20. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 217(2AA) of the Companies Act 1956, the Directors, based on the representations received from the Operating Management, confirm that:

i. in the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;

ii. they have, in selection of the accounting policies, consulted the Statutory Auditors and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

iii. 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 Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities;

iv. they have prepared the annual accounts on a going concern basis.

21. ACKNOWLEDGMENTS

Your Directors would like to express their heartfelt gratitude to all the customers, business partners, bankers and auditors for their continued support and association. The Directors also wish to thank the Government and all the statutory authorities for their support and co-operation.

The Directors would also like to place on record their appreciation of the dedicated, individual and collective contribution of all the employees in the overall growth and progress of the Company during the last year.

The Directors, finally, would like to specially thank and place on record their gratitude to all the members of the Company for their faith in the management and continued affiliation with the Company.

On behalf of the Board of Directors

Date: May 15, 2014 S RAMADORAI Place: Mumbai Chairman

20th ANNUAL REPORT 2013 - 14 13 Annexure I – Directors’ Report EMPLOYEE STOCK OWNERSHIPS SCHEMES a) Tata Technologies Limited Employees Stock Option Plan (TTESOP - 2001)

Tata Technologies Limited Employees Stock Option Plan 2001 (TTESOP Plan 2001) was launched by the Company in the year 2001. The status of the options granted and exercised as well as options forfeited during the financial year ended March 31, 2014 as under: ESOPs as on March 31, 2014 Number of Options Granted, Forfeited and Exercised

Options granted as on April 01, 2013 14,651 Further options granted during the financial year 2013-14 Nil Options exercised during the year 600 Cashless options exercised during the year Nil Options lapsed/forfeited during the year Nil Options granted as on March 31, 2014 14,051 Options available for Grant 46,620 b) Stock based incentive schemes by Tata Technologies Limited Employees Stock Option Trust (TTESOP Trust) and Barclays Wealth Trustees (Guernsey) Limited:

To manage and implement various stock based incentive programs for employees of the Company, the Company has formed Tata Technologies Limited Employees Stock Option Trust (TTESOP Trust) and Barclays Wealth Trustees (Guernsey) Limited for employees of the Company and its subsidiaries. Since shares of the Company are not listed on Stock Exchange, Tata Technologies Limited Employees Stock Option Trust (TTESOP Trust) and Barclays Wealth Trustees (Guernsey) Limited purchase the shares from employees and ex-employees of the Company. The shares so purchased by the Trusts are reissued to the employees through various stock based incentive schemes from time to time.

Tata Technologies Limited Employees Stock Option Trust (TTESOP Trust) has implemented the following stock based incentive programs: 1) Tata Technologies Employee Stock Purchase Program 2008 2) Tata Technologies Employee Stock Purchase Program 2009 3) Share Repurchase Program 4) Tata Technologies Employees Stock Purchase Program- Series III (ESPP- Series III) 5) Employees Stock Purchase Program- Series IV (Series – Series IV) 6) Employees Stock Purchase Program- Series V (Series – Series V)

The Schemes implemented by Barclays Wealth Trustees (Guernsey) Limited are: 1) Employee Stock Ownership Program for INCAT Employees 2006 2) Employee Stock Ownership Program for INCAT Key Employees 2007 3) Employee Stock Ownership Program for INCAT General Employees 2007 4) Employee Stock Ownership Program 2009 5) Employee Stock Ownership Program 2010 6) Employee Stock Ownership Program 2012

Status of shares held by both Trusts as on March 31, 2014:

Tata Technologies Limited Employees Stock Option Trust No. of Shares (A) Opening balance as on April 01, 2013 20,869 (B) Shares repurchased during the year 52,875 (C) Balance as on March 31, 2014 [(C)=(A)+(B)] 73,744

Barclays Wealth Trustees (Guernsey) Limited No. of Shares (A) Opening balance as on April 01,2013 295,166 (B) Shares repurchased during the year 262,500* (C) Balances as on March 31, 2014 [(C)=(A)+(B)] 557,666

*Under process of registration

14 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Annexure ll – Directors’ Report rs C- nd s rs er-8 yrs ent - EAG-5 yrs ent - EAG-5 ager - 15 years Manager-6 mths anager-1 yr Manager - 4 yrs ed-Manager-12 yrs Regional Manager IT Last Employment/Designation-Period (International Operations)- 6 yrs Operations)- (International Director- 11 yrs Director- Date of Date of employment Commencement income-tax rules, and Company's contribution to provident fund and provident to contribution and Company's rules, income-tax Total (Years) nd, superannuation fund and the monetary value of non-cash perquisites, of non-cash perquisites, superannuation fund and the monetary value nd, experience ny's rules. ny's On behalf of the Board Directors Chairman S RAMADORAI Qualifications (Finance & Systems) (Finance Technology) (Information ` Net Remunaration ` Gross Remunaration forming part of the Directors' Report for the year ended March 31, 2014 partforming of the Directors' ended March 31, Report the year for Designation/Nature of duties Designation/Nature Age (Years) Name Information as per Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 a Rules, (Particulars of Employees) with the Companies 1956 read as per Section Act, Information 217(2A) of the Companies 1 Pawan Bhageria Kumar 53VP - Manufacturing & IT Practice Senior 8,324,251 5,715,822 BE ( Mech)/MBA 31 18-Sep-12 - General Motors 2 Chandra R 54 Solution - Global Enterprise President Vice 7,939,939 5,541,531 BE (Mech) PGDBM 33 02-Sep-81 M Limited-Sr Motors Tata 3 Sharan Singh Ghanshyam 58 Embedded System General Manager - Automotive 6,306,379 4,342,164 Tech B 36 02-Jul-01 yr E.Vyapar-CEO-1 4 Ghosh S 53 E&D - Global Delivery, President Vice 6,801,607 4,742,649 Tech B 33 01-Jul-81 yrs Limited-Manager-3 Motors Tata 5 Gupta Samrat 41 Officer Chief Financial 13,715,344 9,092,296 MBA, CFA B'Com, 17 18-Apr-07 Manger - Finance-6 mths HCL-General 6 Jain K Manoj 57 Management Relationship Head - Customer 6,776,653 4,719,561 Tech M Tech, B 33 01-Dec-81 - Man Limited Motors Tata 7 Gopinath Jayaraj 41 Global Delivery President 7,379,578 5,174,392 MS 18 07-Jun-02 Manager - 6 yrs Inc- Project Lasons Systems 8 Joshi Ashok G 58 ServicesTechnical & Attributes Head-Vehicle 9,686,389 6,700,819 BE (Mech) 36 01-Jul-78 Limited-Manag Motors Tata 9Wishwas Julka 39 Sales Group Tata Global President- Vice 7,361,753 5,139,624 MBA DEE, B.Tech, 16 09-Feb-05 Max Ltd-Business Comsat 10 K Chandru 55 General Manager-Engines 6,073,599 4,291,648 BE, ME (Mechanical) 32 30-Jul-82 - Manager 18 year Limited Motors Tata 11 A Jack* Keaton 58VPD - President Vice Sr. 7,487,237 5,247,590 MBA 35 7-Sep-13 6 months VP- INC Sr. Limited Technologies Tata 12 Peshave Milind Dnyaneshwar 52 General Manager - Engines 6,171,121 4,316,137 BE, ME (Mechanical) 28 4-Jan-86 - Limited Motors Tata 13 M Rajendra Petkar 47 Engineering Systems Head - Power 8,638,276 6,035,551 Tech BE, M 26 01-Feb-89 y Limited-Manager-2 Motors Tata 14 Avijit Roy 53 Development Manager Digital Product Program 6,935,420 4,903,707 BE, ME (Mechanical) 29 17-May-85 Limit Motors Tata 15 Moorthy Shreekanth 45 - Global PLM President Vice 6,056,019 4,243,772 BE, MS 20 17-Mar-09 Lifecycle Siemens Product Management IN 16 A M Tarnekar 49 General Manager - KBE & DPD Systems 7,102,587 4,999,252 Tech M 25 12-Apr-89 Manager-8 yrs Limited-Dy. Motors Tata 17T N Umamaheswaran 52 OfficerTechnology Chief 11,350,418 7,454,976 M.Tech 29 17-Jul-85 Manager-4 y Limited-Divisional Motors Tata 18 Samir Yajnik 51 Global Services APAC President & COO 15,809,244 10,325,381 M.S., B.Tech 29 01-Apr-07 Presid TTPL, Singapore-Vice Sl no The Gross remuneration shown above is subject to tax and comprises of salary, allowances, monetary value of perquisites as per monetary of perquisites value allowances, is subjecttax and comprises of salary, to above shown Gross remuneration The Date: May 15, 2014 15, May Date: Place: Mumbai Place: superannuation fund. with the Compa in accordance etc., medical benefits, gratuity, entitled to are employees remuneration, the above In addition to The net remuneration is arrived at by deducting from the gross remuneration, income-tax, Company's contribution to provident fu contribution to provident Company's income-tax, deducting from the gross remuneration, at by net remuneration is arrived The wherever applicable. wherever them. the responsibilities assigned to discharge experience to adequate have All the employees The nature of employment in all cases is contractual. of employment nature The None of the employees mentioned above is a relative of any Directorof the Company. of any is a relative mentioned above None of the employees * Indicates that the employee was in service a partthat the employee only for * Indicates of the year.

20th ANNUAL REPORT 2013 - 14 15 Management Discussion & Analysis

A. Company Overview:

Tata Technologies, a company of engineers, led by engineers, helps manufacturers design and build better products. Through the company's comprehensive portfolio of engineering/IT services and solutions, manufacturers can better manage product development throughout the full manufacturing cycle. With over 7,000 employees representing 17 nationalities, the company's delivery model is formulated specifically to offer a unique blend of deep, local expertise for global engineering and product development IT engagements. Tata Technologies currently serves clients in 25 countries. The company's eight global delivery centers are based in Detroit (U.S.), Coventry (U.K.), Pune and Bangalore (India), Brasov, Craiova, and Iasi (Romania), and Bangkok (Thailand). Operating in the aerospace, automotive and industrial machinery verticals, Tata Technologies covers every aspect of the value chain starting from product conceptualization to aftermarket Maintenance Repair and Operations.

B. Manufacturing Offerings:

According to Consumer Reports, the rapidly growing global marketplace is not giving rise to products that are increasingly diverse. Rather, the qualities that differentiate one product from the next is narrowing. Therefore, manufacturers are challenged to outdo their competitors by bringing products to market that are more relevant, more environmentally sustainable all for a lower cost. The global market demands innovation at every turn in the manufacturing process. Tata Technologies' four service groups, capable of functioning in unison, help customers meet the stringent business requirements of product design through manufacturing.

Vehicle Programs and Development - VPD VPD provides complete outsourced program management including concept development, engineering detail and design, validation and manufacturing production services. Complex and large-scale vehicle programs demand VPD's multidimensional engineering approach. Projects of this scale and complexity are achieved through a combination of automotive and industrial machinery experts from the U.S. and Europe, highly skilled automotive engineers from India, and Romania's large pool of industrial machinery engineers.

Outsourced Engineering & Design - E&D E&D services include concept development, VA/VE, CAE, detail engineering, embedded software development, product verification, manufacturing process design, tool design and validation, applied to major product subsystems and components. All of these offerings may incorporate services out of Tata Technologies' engineering centers in the U.S., U.K., India, Romania and Thailand.

Product Lifecycle Management Solutions - PLM Tata Technologies is the world's largest independent reseller of PLM technology. As a PLM consumer, the company draws on insights and best practices developed internally to advance efficiencies within its clients' engineering practices. The collaborative structure of PLM optimizes the product development process. PLM technology is a major contributor to E&D investment efficiency especially for global engineering teams encumbered with extensive supply chains.

Enterprise Solutions Group - ESG ESG provides consultative services and IT solutions to optimize manufacturers' critical enterprise processes. Manufacturers gain improved planning and performance through the application and data analytics of Enterprise Resource Planning (ERP), Manufacturing Execution Systems (MES), Customer Relationship Management (CRM), as well as the intelligent use of the Internet and social media. Tata Technologies has extensive experience rapidly integrating the processes, systems and data of companies acquired by its clients.

C. Overview & Outlook:

1. Manufacturing

The sectors Tata Technologies serves – aerospace, automotive and industrial machinery – have emerged from the global recession; engineering research and development (ER&D) spend has realized consistent growth.

16 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION According to Booz & Company, a global manufacturing and strategy consulting firm, global ER&D spend has seen a sharp recovery with a CAGR of 10 percent and is expected to reach $1.6 trillion by 2020. The National Association of Software and Services Companies (NASSCOM), a leading Indian IT industry body, reported that in FY2013 the country's ER&D segment grew 9.2 percent over the previous year, generating export revenues of $11.2 billion. According to the report, this growth was due in part to the increasing use of electronics as well as increased public demand for greater fuel efficiency. The NASSCOM report noted that the industry in India made significant investments to strengthen both customer outreach, and engineering capacity and capability across new and existing verticals as well as within the full spectrum of the product development value chain. According to the NASSCOM report, “Demand is being driven by an increasingly competitive market and changing demographics in the west where the availability of a skilled engineering workforce is on the decline in many countries.” Tata Technologies is uniquely positioned to help manufacturers tackle the challenges associated with the diminishing engineering talent pool. The Company supplies staff with superior, multi-faceted engineering capability to some of the world's leading automotive OEMs and tier 1 suppliers, aerospace manufacturers and industrial machinery OEMs. The Company's global footprint results in access to seasoned engineers as well as fresh graduates and makes up one of the largest and most experienced pools of engineering talent currently in the industry. Through its staffing service, Tata Technologies clients benefit from a variable rather than fixed cost structure, which allows for scalable resources, both in number and specialty, as the project demands.

Year in Review

Booz & Company reports that although North American industrial companies experienced marginal growth in both revenue and earnings over the past year, there is basis for optimism. Throughout 2013 industrial companies continued to increase cash on hand, which can be quickly leveraged for ER&D investment. With Tata Technologies' Global Engineering Center (GEC) model, companies eliminate fixed costs such as staffing, facilities maintenance, equipment procurement, and software licensing. The variable cost structure of the GEC model allows customers to add, subtract and even shift talent as quickly as the demands of the project fluctuate.

According to Booz & Company, in order to position themselves for growth over the coming year, industrial sector companies must evolve their business models so they can better adapt to changing circumstances in different regions in this increasingly uncertain economic environment. The Tata Technologies suite of offerings is well- suited to provide solutions to these modern-day challenges for our clients.

"What was once a trade-off has become a careful balancing act, but there are tools available that enable success. To boost profits and achieve sustained growth, companies must make the right investment choices to take advantage of coming growth opportunities, develop new ways to better manage their product portfolios, and prepare themselves to benefit as the business world becomes more and more digitized,” the Booz & Company reports states.

Three initiatives manufacturers should consider include:

1. Fine-tune the cost structure to fund growth 2. Manage for agility 3. Leverage digitization

The report continues that a company will have to “rethink its manufacturing footprint, and build competitively differentiated and sustainable capabilities in innovation and product development, lean global digital supply chains, and business development and sales management.”

Along with our GEC model for optimizing the E&D footprint, Tata Technologies is one of the world's leading technology partners to the manufacturing industry. Our proprietary offerings include i GET IT to capture, manage and transfer knowledge assets, i SUPPORT IT for 24/7 help desk assistance and leading industry knowledge collaboration, and i CHECK IT for quality control. These critical tools, coupled with Tata Technologies' customizable training in software, domain education, and overall skills enhancement, boost productivity of engineering and design professionals.

20th ANNUAL REPORT 2013 - 14 17 2. Aerospace

Global air travel is poised to grow significantly over the next few years. As such, the aerospace industry's addressable market is positioned to expand as well. Innovation in business and operating models in aerospace are rapidly evolving. But for industry partners to win the battle against high operating costs, the pace of product innovation needs to gain momentum.

According to Business Week, Boeing has been inundated with orders for new, more fuel-efficient versions of its top-selling 737 jet, the larger 787 Dreamliner, and the 777 long-haul workhorse. At the close of 2013, Boeing had a record-high order backlog: close to 5,100 airplane orders valued at approximately $400 billion. Also according to Business Week, Airbus has an even larger order backlog: 5,559 airplane orders led by its enormously popular A320 family.

A Booz & Company reports states: “As economies around the world become more global and the standard of living improves in developing regions, the demand for air travel will continue to grow. Wide-body and narrow- body aircraft deliveries will drive most of the growth, with regional jet demand lagging.” The report forecasts that the commercial installed base of the industry will double over the next two decades. And Airbus and Boeing contend that the aerospace sector will be worth more than $4 trillion by 2030; 86,000 new aircraft are projected to be delivered over the next 20 years.

Booz & Company states that if the industry can achieve production ramp-up rates, the next several years will likely be profitable for the civil aerospace sector; falling short of optimal production rates could have significant financial implications for the entire sector. “Higher levels of operational agility and more variable production processes, fortitude around cost controls, and a rethinking of cross value chain engagement models and the value distribution will be fundamental for a healthy sector in the future,” that according to Booz & Company.

Significant Backlogs

The backlog of orders for large, commercial, fixed-wing aircraft stands at 10,659 planes and represents more than eight years of assembly work. The demand is driven mainly by the introduction of new aircraft such as the Airbus A320neo and A350, and Boeing's 737 MAX and 787. The depressed market for business jets is starting to recover giving rise to new product development; industry analysts expect the market to grow 5 percent annually over the next few years.

The global commercial helicopter market is projected to grow nearly 2 percent CAGR over the next five years. One of the key factors contributing to this market growth is the increase in demand for military rotorcrafts in the APAC region. And as manufacturers such as Augusta Westland, Bell Helicopter, Eurocopter and Sikorsky face pressure in the military sector, commercial orders out of the energy sector, and search and rescue applications are increasing.

Booz and Company identifies four major challenges confronting the civilian aerospace sector:

1. Increasing production rates 2. Unsustainable development cost and value distribution 3. Growing demand for more efficient aircraft 4. Digitization of the industry

The spurt in production of aircraft has led to slip-ups in the supply chain; few suppliers are geared to meet the increased demand. The existing tooling, infrastructure and capabilities will be pushed to the limit across the upstream supply chain due to increased outsourcing and the rising complexity of sub-systems and assemblies.

Prohibitively high development and production costs for new aircraft has become a significant barrier to entry, even burdening industry leaders such as Boeing and Airbus. And as fuel prices rise, fuel efficiency is becoming one of the most competitive product differentiators. As such, the next generation of aircraft is expected to have lower operating costs, which could prompt many airlines to retire their current fleet and consequently hurt Maintenance, Repair, and Overhaul (MRO) operators.

The aerospace industry cannot escape the race to digitization facing nearly every industry across the globe. Always-on, accurate, and real-time information is becoming paramount and analysts say by 2020 accurate, real- time data will be one of the main drivers to attract customers, and stay relevant. OEMs must adapt to the digitized world to create value and improve customer experience. In the near-term aerospace manufacturers will rely heavily on digitized processes for all aspects of operations including supply chain management.

18 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION New Opportunities

As North American and European aerospace leaders face pressure from manufacturers in emerging markets, such as China and Russia, new market opportunities are opening from design to aftermarket and MRO.

Leveraging a mature and proven Global Engagement Model, in 2013 Tata Technologies' innovation experts, program managers, and skilled engineers provided engineering for Italian aerospace manufacturer Piaggio Aero. The aerospace manufacturer awarded Tata Technologies a multi-year engineering services contract to complete a structural design and analysis solution for a new military aircraft. TATA HAL Technologies Ltd., a joint venture between Tata Technologies and Hindustan Aeronautics Ltd (HAL) will deliver on this prestigious engagement. Whether delivering optimized design processes, solutions and integration techniques, incorporating efficient material selection, improving knowledge capture and dissemination methods, Tata Technologies is poised to impact the aerospace sector.

Areas of Opportunities for Growth in Aerospace:

Offsets: Through defense procurements global aerospace providers have to discharge more than $50 billion in commitments within the next 10 to 15 years. As fixed staffing costs are high, variable staffing costs are practicable. Tata Technologies' Global Engagement Centers, providing skilled engineering talent where our clients need it to be, will be attractive for manufacturers serving the aerospace industry. The Company's operations in Bangalore will be especially appealing to this sector.

Supply Chain Globalization: With increased focus on sustainable cost reduction, more global companies are establishing manufacturing facilities in India. This is providing collaborative opportunities in assisting with greenfield and brownfield projects, as the Company has done with Tata Advanced Systems.

Opportunity in Numbers: The aerospace industry in India is currently valued at $850 to $900 million; it is expected to grow to $5 billion by 2020.

3. Automotive

Rarely has an industry confronted the magnitude of multidimensional change that the automotive industry faces today. The primary finding of IBM's Automotive 2012 Global Study rings true today: “As it races toward 2020, the industry must learn to effectively manage the global services it has put in place, respond to increasing demands for environmental accountability and use the technology at its disposal to transform the way it develops products and goes to market.”

2013 was a banner year for the automotive industry. Global auto sales hit a record-high of nearly 83 million, crashing through the 80 million threshold for the first time. According to IHS Automotive, a global provider of automotive market data, worldwide auto sales in 2013 increased 4.2 percent over 2012. In the U.S., auto sales increased 7.6 percent to 15.6 million. In the world's fastest growing automobile market, China, auto sales topped 21 million. Although Western Europe posted another annual decline in 2013, market analysts expect improved sales in 2014. Projections from analysts across the board are most optimistic about the Indian auto industry, which is soon expected to rival that of China. Booz & Company calls India “the place to be for global (automotive) OEMs.” And IHS Automotive predicts that by 2016 Indian domestic auto sales will catapult the nation from its current post as the seventh largest automotive market to the world's third largest, surpassing Japan, Germany and emerging economy, Brazil.

20th ANNUAL REPORT 2013 - 14 19 The generally positive outlook for the automotive industry does not preclude challenges. The demand for more functionality in motor vehicles will continue growing, according to KPMG's Global Automotive Executive Survey. Consumers will demand full internet connectivity in vehicles that are more environmentally responsible. Greater fuel efficiency and increased safety will be paramount for the next generation of vehicle owners. And as an increasing proportion of the world's population moves into urban areas, automakers will have to package all of these capabilities into smaller vehicles.

The globalization of markets also means automakers must carefully consider where to source and where to sell their products. International suppliers attempting to secure global pricing structure will become new competition for traditional suppliers. Establishing market share in emerging markets is critical to the long-term success of international suppliers and outsource partners.

Revolutionary Changes in Transportation

It is Information technology (IT) that will have the most revolutionary and transformative effects on motor vehicles. But the “Internet of Things” is already transforming automobiles. General Motors' Chevy Volt activates 10 million lines of software code that operates virtually every mechanical and electrical component in this vehicle exemplifying the engineering and development complexities of today's connected and smart vehicles.

More connectivity within vehicles is on the horizon. The head of the automotive practice at the Gartner Group, Thilo Koslowski said, “Similar to the way telephones have evolved into smartphones, over the next 10 years automobiles will rapidly become 'connected vehicles' that access, consume, and create information and share it with drivers, passengers, public infrastructure, and machines including other cars.”

As yet, automakers have focused much of their attention on connecting cars to existing voice and data networks – mimicking smartphone capabilities. But the true value of IT connectivity in vehicles lies in their being networked to the world outside the vehicle. In the near future vehicle-to-vehicle (V2V) wireless communication will enable motor vehicles to communicate with each other, and vehicle-to-infrastructure (V2I) will enable communication with street lights and intersections, for example. Linking cars to each other and to the community will have far-reaching effects creating safer, more efficient, and more orderly traffic on the road.

Chairman of Ford Motor Company Bill Ford described it as, “It will be the closest thing the industry has ever developed to autopilot.” Moreover, he argues, “such ad hoc vehicle networks could be integrated with other transportation networks, from pedestrian cross-walk systems to connected bicycles, making your car a single node in a giant grid of multi-modal transit intelligence.” The vision of an increasing “auto pilot” enabled car appears to be moving quickly from the realm of sci-fi to the real world with potentially profound long-term implications for the consumer, the industry and the economy.

In 2011, the U.S. Department of Transportation awarded the University of Michigan, ranked in 2013 by Times Higher Education as one of the world's best universities, nearly $15 million to conduct a safety pilot of “connected” cars. There are currently 3,000 autonomous vehicles being tested on the roads of Ann Arbor, home to the University and a neighboring city to Tata Technologies' North American headquarters, with plans to add 6,000 more by 2016. After preliminary reviews of the University's research, the U.S. Department of Transportation concluded that V2V technology can, in fact, lower the incidence of crashes. University researchers predict more than $100 million will be spent over the next eight years on autonomous vehicle research in Southeast Michigan alone.

Fuel economy and emissions standards are also revolutionizing the automotive industry. Corporate average fuel economy (CAFE) MPG standards are set to rise more than 80 percent by 2025 and are driving powertrain developments. The industry has responded by increasing levels of hybridization and electrification, exploring alternative fuel and other material to improve fuel economy and vehicle performance. For example, Tesla Motors, manufacturer of electric cars and electric vehicle powertrains, posted profits in the first quarter of 2013 for the first time in the company's 10-year history. And Ford Motor Company, often the industry-leader for its line of trucks, substituted a steel body for aluminum for the 2014 F-150 making the vehicle 700 pounds lighter. More fuel-efficient powertrains combined with lighter weight materials will significantly enable fuel economy.

According to the Booz & Company report, these changes are bringing about a new model for product development. OEMs can no longer afford to operate with such a broad technological agenda so major suppliers are filling the gap. And the industry is seeing new suppliers competing in the market.

Further, a report by McKinsey & Company notes that industry trends are driving OEMs to outsource full vehicle development: “In the face of globalization, further fragmentation/niche models, technological challenges and scarcity of engineering talent, OEMs are increasingly thinking about core competencies and the prospects of outsourcing vehicle development to capable suppliers and engineering sourcing providers.”

20 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Electric Mobility

To capitalize on these industry trends, Tata Technologies formed the Vehicle Programs & Development group (VPD) in 2011. The group has aptly demonstrated its ability to engineer a full vehicle.

In 2012 Tata Technologies' eMO vehicle study was introduced to the industry at the North American International Auto Show in Detroit. The world's first complete vehicle study conducted and developed by an India-based engineering services company, the eMO showcases innovation in automotive packaging and design, manufacturing processes, as well as electric vehicle engineering benchmarks. The eMO was specifically developed to go-to-market at the disruptive price point of $20,000 USD. The following year VPD introduced the eMO-C, a commercial variant, profiled in another part of the eMO report.

In March 2013, Tata Technologies opened an all-new, 10,000-square-foot North American Engineering and Innovation Center in Troy, Michigan, to be home to the VPD group. The facility launched with 60 engineering professionals. The Company expects the engineers working out of the facility to reach 100 in another year.

In the fourth quarter FY2014, Tata Technologies made investments to bolster its embedded systems capabilities by hiring skilled and seasoned embedded systems professionals and by making a capital expenditure for electronic bench testing equipment. With a firm grasp of where the automotive consumer's interests will be over the next five to 10 years, Tata Technologies has begun to explore and research the next variant of the eMO study that will incorporate “beyond the horizon” technologies.

In addition to delivering complete vehicle programs, Tata Technologies continues to provide a wide range of services to many of the world's largest OEMs and suppliers. We have continuously expanded our portfolio to deliver solutions to the automotive industry, to provide solutions for the connected vehicle, and to advance fuel efficiency. Through our extensive global assets, we have determined how best to offer focused, dedicated vehicle engineered solutions to the market.

Leveraging Global Resources

Our Global Engineering Center (GEC) concept – a key part of our One To Win goal of attaining $1 billion in revenue and positioning the Company as the number one partner to manufacturing organizations worldwide – helps our partners dramatically reduce costs. By effectively leveraging global resources, our manufacturing clients working with our GEC, have not only realized reduced costs, they have been able to funnel savings into their engineering research and development efforts.

A GEC model is distinctly different from traditional off-shoring models. Our GEC distributes engineering and product innovation responsibilities across a global team without segregating low- and high-complexity work regionally. Through this model, off-shored work activity is concealed; highly effective team members work on- site for a client, handling significantly more work than an insourced team member.

The GEC model increases the client's global competitiveness through diagnostic-driven process optimization, driving growth and business sustainability. The model also provides ready-access to emerging markets as well as support of operations in mature markets promoting worldwide profitability. Benefits of the GEC model include immediate scalability and enhanced flexibility allowing a client to react quickly to global economic influences.

At the core of the GEC model is a proven and sophisticated Global Engagement Model (GEM) for project management, resource alignment, time tracking, project collaboration, milestone tracking, project metrics, defect management and issue tracking. A core team helps ensure continuity, commitment and knowledge retention while enabling low-learning curves, reduced attrition rates, and quality, on-time delivery.

4. Industrial Machinery

There are five major trends that are evident in the global industrial machinery segment:

1. Agile product development 2. Cost fitness/fine-tuning the cost structure to fund growth 3. Leveraging IT/digitization 4. Developing the BRIC markets and emerging regions 5. Impacting technological trends – connectivity, monitoring and emissions reductions

In a 2013 Industrial Machinery perspective, Booz & Company stated that cost fitness – or fine tuning the cost structure to fund growth – involved analyzing costs separately by activity, diligently determining which business operations are directly responsible for meeting the company's strategic goals, and supporting those operations with adequate budgets.

20th ANNUAL REPORT 2013 - 14 21 Many industrial machinery companies have been working hard to rethink costs and free-up funds to invest in future growth. For many industrial companies, developing the BRIC markets and other emerging regions represent the best opportunities for growth. Construction machinery is expected to rise modestly by two percent in 2014. A more robust rise of six percent is forecast for 2015, aided by gains in mining and forestry. China, India and Brazil – each with a focus on rapid urbanization with thousands of infrastructure projects on the planning board – are looking at economic growth of 7.5 percent, 5.4 percent and 1.7 percent respectively.

With the industrial machinery sector witnessing steady growth worldwide, Tata Technologies is well- positioned to support various OEMs and tier 1 suppliers. Our service offerings cover product design, mechanical, electrical and embedded electronics, and manufacturing engineering. Our aim is to be a full service provider to the industrial machinery industry by leveraging our skills and knowledge in engineering, PLM, and enterprise IT solutions. Tata Technologies' global footprint, diverse line of services and clear understanding of our customers' engineering needs, differentiate us in the marketplace.

Our capabilities in the industrial machinery domain, which was significantly expanded in FY2014 through the acquisition of Cambric, now comprises an additional 325 engineering experts with extensive knowledge in systems, mechanical and electrical engineering, product design, electronics and embedded design and development. Our innovative and frugal engineering approach helps organizations create products – at a faster pace with a lower cost – delivering more value to the end-user.

D. Human Capital

The Company continues to pursue its strategy of growing returns on human capital. We strive to consistently sustain a high performance culture to bring out the best in people in a signature working experience. This supports our customers with highly proactive and motivated teams to ensure delivery on promises of best-of-breed solutions cost effectively. Customer delight leads to Shareholder value.

Talent Acquisition

A focused branding of the Company both with campuses and the industry job market lies at the foundation of our strategy for talent acquisition. The focus on acquiring skills, specific to customer needs takes root with specialized courses designed by us and offered to select institutions. We address the job market with several propositions for quick engagement of exceptional talent. Our PFLE branding (Passionate Fun Loving Engineer), a proactive team of recruiters supported by imaginative IT enabled processes, ensures the highest productivity on talent acquisition. Costs of recruitment benchmark well with industry. Recruitment lead times are continuously on the decline.

Talent Management

People processes are owned by the line functions in the business and facilitated by a highly skilled HR team. Our aim is to nurture and closely track talent and skills for development to address both individual employee aspirations as well as value for our Customers. A variety of learning and development programs, customized for specific levels in the organization are managed throughout the year. These are delivered for both technical and managerial domains of learning, based on assessment of individual employee needs. Classroom programs conducted by expert external and internal faculty and a plethora of eLearning tools are used for learning & development.

A structured process of cascading Corporate Dashboards to Individual Performance Indices is done. These follow through into a robust Performance Assessment framework and culminate with performance based compensation and development plans for the future. An elaborate Reward & Recognition program to recognize excellence is in place. These initiatives help retain and grow engagement of our people with the enterprise and

22 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION the achievement of its goals. The sustained welfare and well-being of employees and their families engages our constant attention for improvement. A flexible medical insurance policy that can be customised to individual needs and secure the best of contemporary hospital treatment has recently been introduced.

Sustaining and growing the engagement of our employees continued as a key thrust area. Several initiatives were undertaken during the year as depicted below.

Our global intiatives and investments

Aligning company activities with sales and ONE TEAM SPEED2 ONE DREAM strategic goals of the ONE GOAL company

Leadership Technical Competency Development Development Program

Standardization of Building employee transactional processes communities

Quick transition to the new environment as Capturing 'Voice of valuable resources Employee'

The results of our efforts have reflected in the reduction in the annual attrition rates from 16% is 2011-12 to 12.6% in 2013-14.

HR processes are increasingly being associated with measureable metrics to track continuous improvement in performance. An elaborate HR MIS has been designed and deployed for monthly reporting to monitor trends on each of these metrics. This also provides a reference point to establish SLAs with customers of HR services. Some examples tracked through the Global MIS are shown below

Return on Human Capital (ROHC) Results

FY 14

ROHC (USD'000) 9.64 Margin Generation (%) 16% Income Generation (USD'000) 58.8 Workforce Efficiency (%) 36% Workforce Cost Control (%) 45% Building Premium Workforce 30.62 Growing the Workforce (%) 13%

20th ANNUAL REPORT 2013 - 14 23 Workforce Demographics

Actual FY14

Headcount Gender Females 12% Males 88% Age 20-25 11% 26-35 55% 36-45 18% 46-55 7% 56-60 2% Rest 6% Average Age (years) 33 Tenure 0 to 1 yr 13% 1 to 3 yrs 34% 3 to 5 yrs 24% 5 to 10 yrs 20% > 10 yrs 10% Average Tenure (years) 4.47

Attrition Analysis (LTM)

Attrition Actual FY14 Global 12.6% APAC 10.8% EU 18.55% NA 26.67% E&D Global 10.31% ESG Global 15.53% PLM Global 19.37%

Training Metrics

Person-days FY 14 Global 5.6 Asia Pacific 6.9 India 6.99 Thailand 2.23 Europe 0.56 North America 1.45 E&D Global 7.21 ESG Global 3.84 PLMS Global 1.68 External Faculty Utilized (% ) 13% Niche Training (person-days) 1.85 HIPOs Covered % (Employees covered) 95% Emp. Training Coverage 86%

E. Risk Management

Risk Philosophy

In current scenario of global volatility a Company's sustainability and growth are based on risk management capabilities. A risk event that affects business is a significant occurrence in the life of any Company, affecting directly on its ability to fulfill its business objectives.

The principal objective of our risk management is to develop a capability and culture of identifying, assessing & mitigating the risk at all levels/functions across the organization. This involves instituting framework, processes,

24 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION policies suitable to our organization and industry. Risk awareness which ultimately insures our sustainability in the business and provide benefits to our stakeholders and customers. The following are the broad objectives of risk management:

1. Reduce unacceptable performance inconsistency Evaluate the likelihood and impact of major events and develop responses to either prevent those events from occurring or manage their impact on the Company if they do occur.

2. Build confidence of stakeholders Increase transparency of risks and risk management capabilities, and improve the maturity in identifying and managing critical risks.

3. Strengthen corporate governance Strengthen Board oversight, explain risk management roles and responsibilities, set risk management authorities and boundaries, and effectively communicates risk responses in support of key business objectives.

4. Successfully respond to a changing environment Assist management with evaluating the assumptions underlying the existing business model, the effectiveness of the strategies around executing that model, and with identifying alternative future scenarios, evaluate the likelihood and severity of those scenarios.

5. Align strategy and corporate culture Help management to create risk awareness and an open, positive culture with respect to risk. Centralize policy setting and creates focus, discipline, and control. Increase accountability for managing risks across the enterprise and facilitate timely identification of changes in an entity's risk profile.

OPERATIONS FINANCIAL COMPLIANCE REPORTING Monitoring Board Information & Communication Activity 2 Audit Commitee Activity 1 Control Activities Unit B Corporate Head Unit A Risk Assessment Segment Head

Control Enrolment Unit Head

Breadth of Responsibilities Each COSO Cell has a responsibility Triangle

Definition

ERM is a process, effected by an entity's Board of Directors, management and other personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may affect the entity, and manage risks to be within its risk appetite, to provide reasonable assurance regarding the achievement of entity objectives.

The Company has established a formal Enterprise Risk Management (ERM). The Company has adopted the recommendations on the Enterprise Risk Management framework provided by “The Committee of Sponsoring Organizations of the Treadway Commission” (COSO). As a services focused Company, it is necessary for the Company to manage risk at the individual transaction level and to consider aggregate risk at the customer, industry and geographic, where appropriate.

ERM Organization and Process

The Executive Management Team of the Company is responsible for implementing the Risk Management Framework under the direction of the Audit Committee of the Company, and the Audit Committee provides periodical updates to the Board of Directors of the Company. The Board monitors the overall performance of the Risk Management function.

20th ANNUAL REPORT 2013 - 14 25 Risk Management Activities

A disciplined approach to risk is important in an organization such as ours, in order to ensure that we are executing according to our strategic objectives and this process is designed to identify potential events that, if they occur, will affect our Company. The management has identified the following top 10 risks, classified into external risk factors and internal risk factors, to help achieve business objectives in a robust manner.

External Risk Factors Internal Risk Factors

1. Revenue Concentration 5. Customer Acquisition

2. Inability to do business with 6. Challenges in Program Management to Tata Motors' competitors deliver large projects

3. Exchange Rate Fluctuations 7. Human Resources Management

4. Statutory Compliance in Respective 8. Bargaining power of suppliers in PLM Jurisdictions Products

9. Leadership Bandwidth & Critical positions

10. Integration and Collaboration

External Risk Factors

1. Revenue Concentration

Out of the Company's total revenue, around 63% to 65% revenue comes from the top 5 customers of the Company. The Company is facing risk of exposure to inherent risks in any single business segment due to high revenue concentration.

Risk Management Activities

The Company is taking steps to diversify its client base. The Company will take targets for each industry vertical and for non-anchor accounts to mitigate risks.

2. Inability to do business with Tata Motors Competitors

Tata Motors Limited (TML), the parent company, is perceived to be a competitor by many global automotive companies. The Company is facing this risk while positioning itself as established player in the domestic and international market.

Risk Management Activities

Company has taken steps to build a valued relationship with its prospective customers and positioning itself as independent entity from the parent company. The Company also in the past diluted its parent Company's ownership through preferential allotment to two Private Equity Funds.

As part of the strategy, the Company has kept its business with TML separate from its business with other automakers, from the beginning. The Company's continues to focus growth with non-TML competitors and with complementary industries.

3. Exchange Rate Fluctuation Risk

The Company continues to be exposed to the impact of changes in foreign currency exchange rates, because considerable revenue comes from outside of India and it may have negative impact of currency fluctuations on operating results.

Risk Management Activities

The Company has natural hedge due to its diversified locations across geographies, the Company incurs the expenses in local currency, which is to be met through receipts in same currency. The Company also

26 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION has taken appropriate foreign exchange cover and spreading its revenues across the various geographies. The Company follows a prudent forex policy.

4. Statutory Compliances in Respective Jurisdictions

Risks arising out of the jurisdiction specific legislative changes where the Company operates.

Risk Management Activities

The Company has implemented the automated compliance system named as “iComply” in India, Singapore, Thailand, UK, France and Germany.

The Company has taken a major initiative to train its support staff based on various locations to comply with all the applicable laws in respective location and has robust system in place to comply with all the applicable provisions. Also, the Company has appointed M/s Ernst & Young as the Compliance Auditors of the Company to conduct the Compliance Audit in the territories where the iComply tool has been implemented.

Internal Risk Factors

5. Customer Acquisition Risk

In today's competitive business environment, the Company may not be able to predict acquisition of customers and its growth.

Risk Management Activities

The Company has deployed Strategic Go-to-Market plan and is taking constant efforts to improve customer acquisition processes and discipline. The Company has also nominated the Executive sponsors for its key accounts. Further, the Customer Relationship Management (CRM) system matured across all territories/countries with process and technology improvements across areas such as Quoting, Pre-Sales, Sales-Delivery Integration, and Visibility to Customer Billing & Payables. The management is closely monitoring the health of sales pipeline, conversions ratios etc. periodically.

6. Challenges in Program Management to Deliver Large Projects

The Company is delivering high-quality engineering and software solutions to its clients but it involves uncertainties, which have impact on the budgeted time and cost, and it ultimately affects the profitability of the Company.

Risk Management Activities

The Company has rolled out Global Engagement Model (GEM), which is a consolidation of best practices from the delivery centers around the world. The Company implemented “Delivery” module in over 80 ongoing projects. GEM helps present a consistent, “common face” of the Company to the customer. GEM is a key project management methodology that addresses how the Company engages with its customers for all Engineering Services Outsourcing (ESO) programs. The objectives of this methodology are to:

• Reduce the amount of effort required to respond to client

? Improve the program execution and thus deliver on time

? Respond quicker to client requirements

? Set a foundation for change within the Company

? Standardize practices across global teams

7. Human Resource Management

The professionals working in the Company are the key assets. The nature of business demands that the Company has adequate professionals with required skill sets at any point of time to meet the customer demands. Considering the high level of turnover of professionals in our industry, the Company could face difficulties in attracting and retaining the necessary work force at any given point of time, which may result in loss of business opportunities.

20th ANNUAL REPORT 2013 - 14 27 Risk Management Activities

Leadership stays in touch with employees through skill level meetings and Employee Briefing sessions (held simultaneously across all geographies and locations). These sessions are coupled with 'Open House', a quarterly briefing session used by the Tata Technologies leadership team to disseminate latest information and updates about the Company followed by an open forum for employees.

The Company is also establishing campus-connect initiatives and partnership with leading institutes inside and outside the Country where appropriate. The Company is focused towards identifying competencies required to deliver value and groom professionals along multiple dimensions: technology, domain, leadership and management.

The Company is focusing on maturing its HR processes as per Tata Business Excellence Model (TBEM) and People Capability Maturity Model (PCMM) at all locations and to reinforce role based organization structure to facilitate empowerment, rapid decision making and assignment of responsibilities.

The Company has an effective Talent Acquisition function to ensure that the proper selection and recruitment process is in place to attract qualified professionals. The Company also has a Learning Center function, which periodically provides training to its employees to support the growing and varied business requirements. The Human Resources (HR) function ensures that the appropriate talent in the industry is attracted and retained. Efforts are also taken to increase the level of employee satisfaction. As a part of retention strategy, the Company has implemented the various Employees Stock Options Schemes and Employees Stock Purchase Schemes for its employees.

8. Bargaining power of suppliers in PLM Products

In PLM Products division, the Company has limited bargaining power with various suppliers of the PML Products around the globe.

Risk Management Activities

The Company's risk is not greater than any other channel partner in its competitive landscape. Each of these partners is unique, but shares common attribute in the complexity of their evolving distribution strategies. The nature of their business model generates frequent changes to account coverage, market support, and availability of margins to partners. The Company has a constant focus on mitigating these factors through executive relationships, good partner management practices, and maintaining strong performance in the Company's field operations.

9. Leadership Bandwidth and Critical Positions

There is a risk that the second line of Executive Management (Leadership Team) may not be available at all the times. Permanent / long-duration unavailability of such key executives may result in the adverse impact on the smooth operations of the Company if the relevant succession plan is not in place.

Risk Management Activities:

Succession Plan is in place for the entire Leadership Team (short term in case of an emergency and long term from job rotations and growth perspective). Growth of next line of leaders is ensured through Learning Organization. This is also ensured by getting them to play higher roles in their existing capacity.

10. Integration and Collaboration

The Company is facing a risk of managing the acquisition related various risks associated with assimilation of personnel, alignment of goals and strategies, retention of key leaders, operations and technology.

Risk Management Activities

The Company is in the process of preparing the comprehensive plans and strategies to ensure that the whenever the Company does acquisitions, it can put the value of acquisitions in to a combined company so as to reap the intended ROIs.

28 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION F. Operational Performance

The financial performance of Tata Technologies Ltd “the Company” as per Indian GAAP is discussed hereunder in two parts:

1. Tata Technologies Ltd (Unconsolidated) which excludes the performance of subsidiaries of the Company and its share in Joint Venture Company.

2. Tata Technologies Ltd (Consolidated) which includes performance of subsidiaries of the Company and its share in Joint Venture Company (Group Companies). The Consolidated Financial Statements bring out comprehensively the performance of the Tata Technologies group and are more relevant for understanding the overall performance of the Tata Technologies group. The financial statements are prepared in compliance with the Companies Act, 1956 and generally accepted accounting principles in India. Significant accounting policies used for the preparation of the Financial Statements are disclosed in the accompanying Notes to Financial Statements, refer Note No. 2 of Standalone Financial Statements and Note No. 2 of Consolidated Financial Statements.

3. The consolidated performance of the Company is reflected in the trend graphics for the last five years.

Dupont Analysis

2012 2013 2014 17% 66% 25% 29% 20% Offshore Growth 14% 12% 12% 14% PBIT 29.51% ` 279.1cr SG&A as % of sales

33.75% Revenue ` 400.1cr 30% 32% 29% 24.30% ` 345.2cr Gross Margin PBIT ROCE = = 14.91 16.25 17.93 Capital Fixed Asset T/O 147mn$` 946cr 64days 56days 47days 155mn$` 1185cr Revenue Days Sales O/S ` 1420cr Capital 1.76 31% 23% 17% 1.73 Revenue growth 1.69

20th ANNUAL REPORT 2013 - 14 29 Return on Equity Return on Capital Employed

35.00% 33.75% 29.51% 30.00% 40.00% 26.45% 24.30% 35.00% 34.12% 33.38% 25.00% 20.96% 34.69% 30.00% 26.41% 25.61% 20.00% 25.00%

20.00% 15.00%

Return on Equity % Return 15.00% 10.00% 10.00% Return on Capital Employed % Employed Return on Capital 5.00% 5.00% 0.00% 0.00% 2009-102010-11 2011-12 2012-13 2013-14 2009-10 2010-11 2011-12 2012-13 2013-14

Diluted Earnings Per Share ESOP Share Price Performance

700 80 607 69.88 70 600 63.48

60 ) 500 ` 417

) 49.20 ` 50 400 37.15 270 EPS ( 40 300 223 30 24.33 196 200 20 ESOP Share Price ( ESOP Share Price 100 10

2009-10 2010-11 2011-12 2012-13 2013-14 2009-10 2010-11 2011-12 2012-13 2013-14

Cash & Cash Equivalents Debtor Days

1000 968 90 900 80 74 775 67 800 70 Crore) 64 ` 700 56 609 60 600 50 47 500 40 400 284 30

300 Debtor Days 200 193 20

Cash & Cash Equivalents ( & Cash Cash 100 10 0 2009-102010-11 2011-12 2012-13 2013-14 2009-10 20010-11 2011-12 2012-13 2013-14

Cash & Cash Equivalents Includes Investment in MFs, NCDs, CRPs, Bills of Exchange, ** Debtor Days are computed after considering Provision for Doubtful Debt ICDs placed and Deposits with FIs.

Fixed Asset Turnover Debt Equity Ratio

25.00 1.00

20.00 0.90 0.86 17.93 0.80 16.25 14.71 14.91 0.70 0.65 15.00 14.59 0.60 0.50 Ratio 0.44 10.00 0.40 0.35 0.31

Fixed Asset Turnover Asset Fixed 0.30 5.00 0.20 0.10

2009-10 2010-11 2011-12 2012-13 2013-14 2009-10 2010-11 2011-12 2012-2013 2013-14

30 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Revenue Offshore Revenue 2,600 450 2,400 2,395 414 400 2,200 2,045 2,000 350 321 1,800 1,667 300 1,600

Crore) 257 1,400 1,268 ` 250 Crore) ` 1,200 1,098 200 1,000 155 800 150

Revenue ( Revenue 103 600 100 400

Offshore Revenue ( Offshore Revenue 50 200

2009-10 2010-11 2011-12 2012-13 2013-14 2009-10 2010-11 2011-12 2012-13 2013-14 ** Revenue generated by Offshore Delivery Centers

Revenue by Country ( ` Crore) EBITDA

450 433 400 393 2 350 691691 305 95151 300 India 250

Singapore Crore)

` 206 US 200 153 EU ** 16 150

Thailand ( EBITDA 100

50 735

** EU includes France & German Branch operations 2009-10 2010-11 2011-12 2012-13 2013-14

Profit After Tax Effective Tax Rate

350 301 300 273 35%

250 30% 28% Crore) ` ( 208 23% 23% 23% 200 25% 20% 19% 150 139 15% 100 91 10% Profit after Tax Tax after Profit Percent 50 5% 0% 2009-10 2010-11 2011-2012 2012-13 2013-14 2009-102010-11 2011-2012 2012-13 2013-14

Operating Cash Flows

400 354 364 350

300

Crore) 250 248 ` ( 200 153 150 108 Cash Flows Flows Cash 100

50

2009-10 2010-11 2011-2012 2012-13 2013-14

20th ANNUAL REPORT 2013 - 14 31 4. The discussion should be read in conjunction with the financial statements and notes for the year ended March 31, 2014.

The total income of the Company (Unconsolidated) aggregated ` 929.34 crore in fiscal 2014 as compared to ` 818.03 crore in fiscal 2013, registering a growth of 13.61%.

The Company's earnings before interest, taxes, depreciation, and amortisation (EBITDA) (Unconsolidated) aggregated to ` 296.88 crore in fiscal 2014 as compared to ` 290.68 crore in fiscal 2013, registering a growth of 2.13%.

The profit before tax (PBT) (Unconsolidated) aggregated to ` 259.30 crore in fiscal 2014 as compared to ` 262.04 crore in fiscal 2013, registering a degrowth of 1.05%.

The Company's (Unconsolidated) profit after taxes aggregated ` 202.72 crore as compared to ` 201.22 crore in fiscal 2013, registering a growth of 0.75%.

In fiscal 2014, the total income of the Company (Consolidated) aggregated ` 2,394.73 crore as compared to ` 2,045.42 crore in fiscal 2013, registering a growth of 17.08%. The Company's earnings before interest, taxes, depreciation, and amortisation (EBITDA) (Consolidated) aggregated to ` 393.34 crore in fiscal 2014 as compared to ` 433.14 crore in fiscal 2013, registering a degrowth of 9.19%. The profit before tax (PBT) (Consolidated) aggregated to ` 337.57 crore in fiscal 2014 as compared to ` 392.43 crore in fiscal 2013, registering a degrowth of 13.98% The consolidated profit after taxes aggregated ` 273.22 crore in fiscal 2014 as compared to ` 300.73 crore in fiscal 2013, registering a degrowth of 9.15%. During the year the Company has paid interim dividend of ` 12 per share and a final dividend of ` 18 per equity share has been recommended. Full details of the dividend paid are available in the Director's Report.

RESULTS OF OPERATIONS Tata Technologies Ltd. (UNCONSOLIDATED)

The Management's Discussion and Analysis given below relates to the financial statements of the Company (Unconsolidated). The discussion should be read in conjunction with the financial statements and related notes for the year ended March 31, 2014.

The following table gives an overview of the financial results of the Company (Unconsolidated):

INCOME Income from Operations

2013- 14 2012- 13 Particulars % of Variance ` in crores % of Income ` in crores % of Income

INCOME Income from Services 762.89 82.09% 671.54 82.09% 13.60% Sale of Products 122.12 13.14% 102.26 12.50% 19.42% Commission Income 1.17 0.13% 0.90 0.11% 30.00% Other Income 43.16 4.64% 43.33 5.30% -0.39% Total Income 929.34 100.00% 818.03 100.00% 13.61%

EXPENDITURE Cost of Traded Products 98.23 10.57% 83.02 10.15% 18.32% Consultancy fees, Softwares and others 60.80 6.54% 40.68 4.97% 49.46% Employee Benefit Expenses 399.61 43.00% 345.18 42.20% 15.77% Other Expenses 73.82 7.94% 58.47 7.15% 26.25% Total Expenditure 632.46 68.05% 527.35 64.47% 19.93%

Profit before Finance Charges, Depreciation and Taxes 296.88 31.95% 290.68 35.53% 2.13% Finance Cost 1.43 0.15% 1.62 0.20% -11.73% Depreciation and amortization 36.15 3.89% 27.02 3.30% 33.79%

Profit before Taxes 259.30 27.90% 262.04 32.03% -1.05%

Provision for taxes including deferred tax 56.58 6.09% 60.82 7.43% -6.97%

Net Profit from Operations after taxes 202.72 21.81% 201.22 24.60% 0.75%

32 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION The Company's revenue consists mainly of income from services and sale of products. The Company provides services either on time and material basis or fixed price basis. The Company's revenue from services on time and materials contracts is recognized when services are rendered and related costs are incurred. In case of fixed price contracts, revenue is recognized over the life of the contract based on milestones achieved as specified in the contracts or by proportionate completion method on the basis of the work completed. Foreseeable losses on such contracts are recognized when probable. Revenue from rendering Annual Maintenance Services is recognized proportionately over the period of contract. Revenue from third party software products and hardware sale is recognized upon delivery.

The Company's (unconsolidated) revenues increased to ` 886.18 crore in fiscal 2014, from ` 774.7 crore in fiscal 2013, a growth of 14.39%. Revenues from services increased to ` 762.89 crore in fiscal 2014 from ` 671.54 crore in fiscal 2013, a growth of 13.60%. Revenues from sale of products increased to ` 122.12 crore in fiscal 2014 from ` 102.26 crore in fiscal 2013, an increase in revenue of 19.42%. Commission income on sale of products increased from ` 0.90 crore to ` 1.17 crore, registering a growth of 30%.

Other Income Other Income in fiscal 2014 decreased to ` 43.16 crore from ` 43.33 crore in fiscal 2013, a degrowth of 0.39%. Other Income comprises interest received on inter corporate deposits and deposits with banks, dividends received on investments in units of mutual funds, profit on sale of investments, write-back of provisions no longer required and foreign currency gains(net). Details of major portion of other income are as under:

a) Interest Income on inter corporate deposits, deposits with the banks and interest income from long term deposits with financial institutions in fiscal 2014 was ` 12.50 crore as compared to interest income of ` 8.04 crore in fiscal 2013. b) Dividend of ` 13.85 crore from investments in units of mutual funds in fiscal 2014 as compared to ` 14.34 crore in fiscal 2013. c) Foreign currency gain (net) in fiscal 2014 was ` 2.31 crore as compared to foreign currency gain (net) of ` 1.45 crore in fiscal 2013. d) Other non-operating income in fiscal 2014 was ` 8.12 crore as compared to ` 15.58 crore in fiscal 2013. The decrease is due to the write back of provisions no longer required. In fiscal 2014 it was ` 7.31 crore as compared to ` 13.37 crore in fiscal 2013.

EXPENDITURE

Cost of Traded Products Cost of Traded Products represents cost of products traded during the year under reference. Total cost of traded products in fiscal 2014 was ` 98.23 crore, an increase of 18.32% over the costs of ` 83.02 crore in fiscal 2013. This increase is attributable to overall increase in income from the sale of products. As mentioned earlier, revenues from sale of products increased to ` 122.12 crore in fiscal 2014 from ` 102.26 crore in fiscal 2013, an increase of 19.42%.

Consultancy Fees, Softwares and Others Consultancy fees represents outsourcing charges paid to the third parties towards various jobs outsourced/services received. The cost of softwares represents the purchase cost of softwares for internal use for enhancing the quality of services and also meeting the needs of the customers. Total consultancy fees, softwares and others in fiscal 2014 was ` 60.80 crore, an increase of 49.46% over the total consultancy fees, softwares and other cost of ` 40.68 crore in fiscal 2013. Total consultancy fees, softwares and others as a percentage of total income was 6.54% in fiscal 2014 (4.97% in fiscal 2013). This increase is attributable to increase in volume of outsourcing works during fiscal 2014 as compared to fiscal 2013. Similarly, fees paid towards professional services procured in the current year increased by 66.42 %.

Employee Benefit Expenses Employee Benefit Expenses consist of compensation of employees. It includes salaries which have fixed and variable components, contribution to provident fund, superannuation fund and gratuity fund. It also includes expenses incurred on staff welfare. Total employee benefit expenses in fiscal 2014 was ` 399.61 crore, an increase of 15.77% over the total employee costs of ` 345.18 crore in fiscal 2013. Total employee costs as a percentage of total income was 43% in fiscal 2014 (42.2% in fiscal 2013). This increase is attributable to increase in cost per employee. The number of employees as at March 31, 2014 was 5,148 as against 4,788 during the previous year.

Other Expenses Other Expenses (other than cost of traded products, consultancy fees, softwares and others and employee benefit expenses, already discussed above) incurred to conduct the Company's operations have gone up from ` 58.47 crore in fiscal 2013 to ` 73.82 crore in fiscal 2014. In terms of total income, it has gone up from 7.15% in fiscal 2013 to 7.94% in fiscal 2014. The increase of other expenses is primarily due to increase of Rent, AMC charges, Communication expenses. Rent, AMC charges and Communication expenses increased from ` 20.35 crore in fiscal 2013 to ` 29.53 crore in fiscal 2014.

20th ANNUAL REPORT 2013 - 14 33 Profit before Finance Charges, Depreciation and amortization and Taxes The profit before finance charges, depreciation and amortization and taxes in fiscal 2014 was ` 296.88 crore, an increase of 2.13% from ` 290.68 crore in fiscal 2013. The profit as a percentage of income has gone down from 35.53% in fiscal 2013 to 31.95% in fiscal 2014.

Finance Cost Finance cost decreased marginally from ` 1.62 crore in fiscal 2013 to ` 1.43 crore in fiscal 2014. This was due to reduction in interest and other charges paid on PCFC and PSFC loans (foreign currency loan) taken from banks.

Depreciation and Amortization Depreciation and Amortization charges increased from ` 27.02 crore in fiscal 2013 to ` 36.15 crore in fiscal 2014 an increase of 33.79%. In terms of total income the depreciation and amortization charge was 3.89% of total income in fiscal 2014 (3.30% in fiscal 2013). The said charge has gone up due to purchase of fixed assets for SEZ unit 2, operations of which were commenced in the month of April 2013. There was no corresponding depreciation on account of this during previous fiscal.

Profit before Taxes The Profit before Taxes in fiscal 2014 was ` 259.30 crore, a decrease of 1.05% from ` 262.04 crore in fiscal 2013. In terms of total income, the Profit before Taxes has gone down from 32.03% in fiscal 2013 to 27.90% in fiscal 2014.

Provision for Taxation Income tax expense comprises the current tax and the net change in the deferred tax assets and liabilities in the applicable fiscal period. The Company benefits in India from certain tax incentives under section 10AA of the Income Tax Act, 1961, for the IT services exported from designated 'Special Economic Zone Unit”. The tax expense decreased from ` 60.82 crore in fiscal 2013 to ` 56.58 crore in fiscal 2014. This represented 6.09% of the total income in fiscal 2014 (7.43% of the total income in fiscal 2013). The effective tax rate (total tax expenses including deferred tax/profit before tax*100) in fiscal 2014 decreased to 21.82% from 23.21% in fiscal 2013. The said decrease was primarily due to incentives under section 10AA of the Income tax Act, 1961.

Net Profit from operations after taxes The Company's net profit from operations after taxes registered a growth of 0.75% from ` 201.22 crore in fiscal 2013 to ` 202.72 crore in fiscal 2014.

FINANCIAL POSITION - Tata Technologies Ltd. (UNCONSOLIDATED) Share Capital (Amount in ` Crore)

Particulars As at March 31, 2014 As at March 31, 2013

Authorized : 60,000,000 ordinary shares of Rs. 10/- each 60.00 60.00 (P.Y. 60,000,000 ordinary shares of Rs. 10/- each) 700,000 0.01% Cumulative Non-participative Compulsorily Convertible Preference Shares of Rs. 10/- each. 0.70 0.70 (P.Y. 700,000 0.01% Cumulative Non-participative Compulsorily convertible Preference Shares of Rs. 10/- each) Total 60.70 60.70

Issued, Subscribed and Paid-up : 43.02 43.02 43,024,138 equity shares of Rs. 10/- each (P.Y. 43,023,538 equity shares of Rs. 10/- each) Total 43.02 43.02

During the year, the Company did not increase authorized capital of ordinary shares and Cumulative Non Participative Compulsorily Convertible Preference Shares. The authorized equity share capital as on March 31, 2014 was ` 60 crore, divided into 60 Mn equity shares of ` 10 each (` 60 crore as at March 31, 2013, divided into 60 Mn equity shares of ` 10 each). The issued, subscribed and paid-up share capital as on March 31, 2014 was ` 43.02 crore. During the year, the Company issued equity shares to employees (under ESOP Scheme 2001). Consequently, the issued, subscribed and paid up capital of the Company increased by ` 0.0006 crore in fiscal 2014. Details of options granted, outstanding and vested as at March 31, 2014 are provided in this Annual Report.

34 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Reserves and Surplus A summary of reserves and surplus is as under: (Amount in ` Crore)

Particulars As at March 31, 2014 As at March 31, 2013

Securities Premium 350.50 350.50 Securities Premium Identified for Consolidation adjustments 23.16 23.16 General Reserves 90.65 69.65 Surplus i.e. balance in Statement of Profit and Loss 252.16 221.98 Total 716.47 665.29

Securities Premium Account (Amount in ` Crore)

Particulars As at March 31, 2014 As at March 31, 2013

As at the beginning of the year 350.50 350.02 Additions during the year - 0.48 Total 350.50 350.50

Securities Premium Account as on March 31, 2013 stood at ` 350.50 crore. As on March 31, 2014 the balance in this account stood at ` 350.50 crore. The additions (net) to the Securities Premium Account of ` 0.003 crore during the year is primarily on account of premium received on exercise of options under ESOP Scheme.

During 2010, based on the approval of Shareholders of the Company at the Extra-Ordinary General Meeting held on March 5, 2010 and the Order of the Honourable High Court of Judicature at Mumbai dated April 16, 2010, the Company had utilized balance in the Securities Premium Account to the tune of ` 46.66 Crore towards one time charges/cost (including change in accounting policy for provision for doubtful debts) incurred by the Company and its subsidiary companies. The amounts relating to the Company amounting to ` 17.32 Crore had been adjusted to the Securities Premium Account. An amount of ` 29.34 Crore equivalent to the total amount of adjustments relating to the subsidiaries had been identified and segregated from the balance in the Securities Premium Account for adjustment on consolidation. Of this total adjustment made, ` 1.58 Crore and ` 16.58 Crore related to provision for doubtful debts of the Company and its subsidiary companies respectively on account of change in accounting with regard to provision for doubtful debts.

During the year ended March 31, 2014, the Company and its subsidiary companies have received amounts aggregating to ` Nil (` 0.02 Crore for the year ended March 31, 2013) against the balances adjusted in the Securities Premium Account as above. Consequently, such excess provisions for doubtful debts on account of the said collections have been written back to the Securities Premium Account. Realisation of doubtful debts provided for the adjustments above upto March 31, 2014 amounted to ` 6.18 Crore pertains to the subsidiaries. Accordingly, balance amount of ` 23.16 Crore relating to the subsidiaries is continued to be disclosed separately as Securities Premium Account for adjustment on consolidation.

Shareholders' funds The total shareholder funds increased to ` 759.49 crore as at March 31, 2014 from ` 708.31 crore as of the previous year end. The basic earnings per share increased to ` 47.12 as at March 31, 2014 compared to ` 46.77 as of the previous year end.

Non-Current Liabilities A summary of Non-Current Liabilities is as under: (Amount in ` Crore)

Particulars As at March 31, 2014 As at March 31, 2013

Long-term borrowings 0.05 0.17 Deferred tax liabilities (Net) 3.44 4.56 Trade payables 0.45 0.36 Long-term provisions 16.43 8.55 Total 20.37 13.64

20th ANNUAL REPORT 2013 - 14 35 All liabilities other than the current liabilities are classified as non -current liabilities. Long term borrowings include vehicle loans from banks/others and finance lease obligations in the nature of long term. Long term borrowings decreased to ` 0.05 crore as at March 31, 2014 as compared to ` 0.17 crore as at March 31, 2013.The decrease was primarily due to repayment of vehicle loans taken from banks/others. Vehicle loans were ` Nil as at March 31, 2014 (` 0.04 crore at March, 31 2013).

Deferred Tax Liabilities (Net) Note No. 6 brings out details of component wise deferred tax balances where the net value results into liability. As can be seen from Note No.6, deferred tax liability was created against depreciation. The net deferred tax liability (net) was ` 3.44 crore as at March 31, 2014. (` 4.56 crore deferred tax liability (net) as at March 31, 2013). Deferred tax assets are created against certain items such as employee benefits and provision for doubtful debts. The Company assesses the likelihood of deferred tax getting recovered from the future taxable income.

Trade Payables Trade payables are dues in respect of goods purchased or services received (including from employees, professionals and others under contract) in the normal course of business. Trade Payable shown under non- current liabilities represents amount payable towards retention bonus to certain employees. Trade payables were ` 0.45 crore as at March 31, 2014 (` 0.36 crore as at March 31, 2013)

Long Term Provisions Long term provisions represents provisions made towards certain non-funded employee benefits- such as Bhavishya Kalyan Yojana, medicare, leave encashment etc. Provision for employee benefits has been made based on an independent actuarial valuation as on the balance sheet date. Long term provisions were ` 16.43 crore as at March 31, 2014 (` 8.55 crore as at March 31, 2013).

Current Liabilities A summary of Current Liabilities is as under:

(Amount in ` Crore)

Particulars As at March 31, 2014 As at March 31, 2013

Short-term borrowings from banks (Unsecured) 89.84 54.28 Trade payables 129.47 126.46 Other current liabilities 8.89 10.00 Short-term provisions 92.10 81.14 Income tax liabilities (Net) 0.28 0.28 Total 320.58 272.16

A liability is classified as Current when any of the following is satisfied

a) It is expected to be settled in the Company's normal operating cycle b) It is held primarily for the purpose of being traded c) It is due to be settled within twelve months after the reporting date or d) The Company does not have an un conditional right to defer settlement of the liability for at least twelve months after the reporting date

As reported elsewhere in this discussion, all other liabilities are classified as Non-current Liabilities.

Short Term Borrowings from banks (Unsecured) Short term borrowings represent unsecured post shipment loan taken from a bank. The Company has not provided any security towards the said loans. Short term borrowings were ` 89.84 crore as at March 31, 2014 (` 54.28 crore at March 31, 2013).

Trade Payable Trade payables are dues in respect of goods purchased or services received (including from employees, professionals and others under contract) in the normal course of business. Trade Payables were ` 129.47 crore as at March 31, 2014 (` 126.46 crore as at March 31, 2013). Trade payable has gone up due to amount payable to employees on account of performance pay and payables for services, capital items and traded products.

Other Current Liabilities Other current liabilities as at the end of the fiscal 2014 aggregated ` 8.89 crore (` 10.00 crore as at the end of the fiscal 2013). Major portion of other current liabilities represents dues payable to statutory authorities, income

36 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION received in advance and advance received from the customers. ` 7.72 crore was outstanding at the end of the fiscal 2014 on account of statutory dues, income received in advance and advance received from customers (` 8.69 crore at the end of the fiscal 2013).

Short Term Provisions Short term provisions represents provisions made towards employee benefits (current portion), provision for final dividend and dividend tax on final dividend. Current portion of provision for employee benefits has been made based on an independent actuarial valuation as on the balance sheet date. Short term provisions as at the end of the fiscal 2014 aggregated ` 92.10 crore (` 81.14 crore as at March 31, 2013). Short term provisions have gone up as compared to previous year. This is due to provision for final dividend. Provision for final dividend in fiscal 2014 was ` 77.44 crore (` 68.84 crore in fiscal 2013) due to high rate of dividend proposed.

Income tax liabilities (net) Income tax liabilities (net) represent estimated income tax liabilities. The provision for tax liabilities (net of advance tax) was ` 0.28 crore as at March 31, 2014 (` 0.28 crore as at March 31, 2013)

Fixed Assets Details of fixed assets are as under: (Amount in ` Crore)

Particulars As at March 31, 2014 As at March 31, 2013

Tangible Assets 74.08 59.85 Intangible Assets 39.39 36.12 Capital Work-in-progress 0.49 13.67 Intangible Assets in progress 1.88 3.29 Total 115.84 112.93

A statement of movement in tangible fixed asset is as follows: (Amount in ` Crore)

As at As at Particulars March 31, 2014 March 31, 2013 % of Change

Leasehold Land 4.09 4.09 0.00% Buildings 22.83 22.79 0.18% Plant & Machinery- owned 19.69 17.26 14.08% Plant & Machinery -leased 0.43 0.43 0.00% Office Equipments 3.92 3.20 22.50% Computers 70.77 51.91 36.33% Furniture & Fixtures 9.74 8.15 19.51% Vehicles 2.08 2.82 -26.24% Leasehold improvements 10.32 5.87 75.81% Total 143.87 116.52 23.47% Less: Accumulated Depreciation 69.79 56.67 23.15% Net Block 74.08 59.85 23.78% Add: Capital work in progress 0.49 13.67 -96.42% Net Fixed Assets 74.57 73.52 1.43%

During the year, the Company added ` 30.35 crore to the gross block of tangible assets comprising ` 0.04 crore Buildings, ` 2.60 crore plant & machinery -owned, ` 0.97 crore office equipments, ` 20.01 crore computers, ` 1.59 crore furniture and fixtures, ` 0.69 crore vehicles, ` 4.45 crore leasehold improvements. During the previous year, the Company added ` 9.73 crore to gross block of assets of the Company. The major portions of additions during the year were on account of Computers and lease hold improvements to SEZ unit 2.

During the year, the Company retired ` 3.00 crore from the gross block of assets comprising ` 0.17 crore of plant & machinery -owned, ` 0.25 crore office equipment, ` 1.15 crore computers, ` 1.43 crore vehicles. During the previous year, the Company retired/transferred various assets with gross block of ` 4.79 crore. The Company has

20th ANNUAL REPORT 2013 - 14 37 a capital commitment of ` 11.75 crore as at March 31 2014 as compared to ` 9.49 crore as at March 31, 2013 towards tangible assets.

Intangible assets represents software licenses (other than internally generated).During the year, the Company added ` 23.62 crore to the gross block of intangible assets (software licenses). During the previous year, the Company added ` 19.06 crore to gross block assets of the Company. The Company has a capital commitment of ` 2.51 crore as at March 31, 2014 as compared to ` 8.59 crore as at March 31, 2013 towards intangible assets.

Capital work in progress comprises of the cost of tangible fixed assets that are not ready for their intended use at the reporting date. Capital work in progress at the end of fiscal 2014 aggregated ` 0.49 crore (` 13.67 crore at the end of fiscal 2013).

Intangible assets in progress represent costs incurred towards purchase of SAP licenses and cost incurred towards implementation of the same. Intangible assets in progress at the end of fiscal 2014 aggregated ` 1.88 crore (` 3.29 crore at the end of fiscal 2013).

Other Non-Current Assets A summary of other non-current assets is as under: (Amount in ` Crore)

Particulars As at March 31, 2014 As at March 31, 2013

Non-current Investments 233.98 246.48 Long-term loans and advances 8.19 6.36 Income tax assets (Net) 26.09 13.34 Total 268.26 266.18

Non-Current Investments A summary of the Company's non-current investments is given below: (Amount in ` Crore)

Particulars As at March 31, 2014 As at March 31, 2013

(A) Trade Investments Investments in Equity instruments (Unquoted at cost) i) Subsidiaries (a) Tata Technologies Inc. 15.57 15.57 (b) Tata Technologies Pte Ltd 203.34 203.34 ii) Joint Ventures Tata HAL Technologies Ltd 5.07 5.07 (B) Other Investments (Quoted) i) Investment in Bonds 5.00 5.00 ii) Investments in Mutual Fund - 12.50 (C) Other Investments (Unquoted) i) Investment in Preference Shares 5.00 5.00 Total 233.98 246.48

The trade investment is an investment made by the company in shares of another company to promote the trade or business of the company. Other investments represent other than trade investments. Investments are either classified as current or long term based on the management's intention at the time of purchase. As can be seen from the above table, during the year, the Company did not make any further investment in its subsidiary companies and Joint Venture Company. Investments in bonds, preference shares and mutual funds aggregated ` 10.00 crore as on March 31, 2014 (` 22.5 crore as on March 31, 2013).

38 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Long Term Loans and Advances: A summary of the Company's long term loans and advances is given below:

(Amount in ` Crore)

Particulars As at March 31, 2014 As at March 31, 2013

Security Deposits 0.47 1.12 Loans to employees 1.14 2.13 Loans to Others 5.07 2.10 Capital Advances 0.32 0.06 Prepaid Expenses 0.11 0.27 Deposits with Government and others 1.08 0.68 Total 8.19 6.36

As can be seen from the table, Loans and Advances as on March 31, 2014 were ` 8.19 crore (` 6.36 crore as on March 31, 2013). There are no major variances in long term loans and advances in fiscal 2014 as compared to fiscal 2013.

Income Tax Assets (net) Income Tax Assets (net) were ` 26.09 crore in fiscal 2014 (` 13.34 crore in fiscal 2013). Income tax assets (net) have increased as compared to the previous year due to excess of withholding tax from the customers than the provision for income tax.

Current assets: A summary of the Company's current assets is given below:

(Amount in ` Crore)

Particulars As at March 31, 2014 As at March 31, 2013

Current Investments 492.90 262.46 Trade Receivables 114.92 124.59 Cash and Bank Balances 88.90 19.07 Other Current Assets 8.46 12.04 Short-term loans and advances 11.16 196.84 Total 716.34 615.00

Current Investments During the year, the Company invested in units of mutual funds. These are typically investments in short -term funds to gainfully use the excess cash balance with the Company. Current Investments at the end of the fiscal 2014 aggregated to ` 492.90 crore (` 262.46 crore at the end of the fiscal 2013).

Trade Receivables Trade receivables are dues in respect of goods sold or services rendered in the normal course of business. A trade receivable is treated as current, if it is likely to be realized within twelve months from the date of Balance Sheet or operating cycle of the business. Trade Receivables as on March 31, 2014 aggregated ` 114.92 crore (net of provision for doubtful debts) (` 124.59 crore as on March 31, 2013). Bad debts written off were ` 1.80 crore in fiscal 2014 (Nil in fiscal 2013). The Company provides provision for doubtful debts as a percentage of the outstanding debts based on ageing.

Cash and Bank Balances Cash and bank balances include cash and cash equivalents and other bank balances. The Company's Cash and Bank balance is ` 88.90 crore as on March 31, 2014 (` 19.07 crore as on March 31, 2013). The said amount has gone up due to cheques on hand / remittances in foreign currency in transit amounting to ` 22.62 crore as compared to previous year. The cash and cash equivalents aggregated ` 87.56 crore as on March 31, 2014 (` 18.22 crore as on March 31, 2013). Other bank balances at the end of the fiscal 2014 aggregated to ` 1.34 crore (` 0.85 crore at the end of the fiscal 2013)

20th ANNUAL REPORT 2013 - 14 39 Other Current assets A summary of other current assets of the Company is given below: (Amount in ` Crore)

Particulars As at March 31, 2014 As at March 31, 2013

Interest Accrued on deposits and investments 0.30 0.30 Unbilled Revenue 2.58 1.19 Advances to suppliers and contractors 1.42 4.92 Prepaid expenses 3.74 2.99 Unamortized Premium on forward contract - 0.03 Others (VAT, Service tax, other taxes recoverables, etc.) 0.42 2.61 Total 8.46 12.04

As can be seen from the above information, other current assets as on March 31, 2014 were ` 8.46 crore (` 12.04 crore as on March 31, 2013). The said amount has come down as compared to the previous year as the advances to suppliers and contractors have come down by ` 3.50 crore as compared to previous year.

Short term loans and advances A summary of short term loans and advances of the Company is given below:

(Amount in ` Crore)

Particulars As at March 31, 2014 As at March 31, 2013

Inter Corporate Deposits - 183.90 Loans and advances to related parties 9.74 12.23 Security Deposits 1.00 0.34 Loans and Advances employees 0.41 0.33 Less : Allowances for doubtful loans and advances (0.04) (0.04) Deposits with Government and others 0.05 0.08 Total 11.16 196.84

As can be seen from the above information, short term loans and advances as on March 31, 2014 were ` 11.16 crore (` 196.84 crore as on March 31, 2013). Short term loans and advances have gone down primarily due to inter corporate deposits. Inter corporate deposits as at March 31, 2014 were ` Nil (` 183.90 crore as at March 31, 2013)

40 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Cash Flow - TTL (Unconsolidated)

Cash Flow from Operating Activities (Amount in ` Crore)

Particulars 2013-14 2012-13 Change

Net Profit after Taxation 202.72 201.22 1.50 Depreciation and amortization 36.14 27.02 9.12 Disallowance of TDS Abroad 0.28 0.30 (0.02) Provision for Wealth Taxes 0.01 0.01 - Provision for Income Tax 57.70 60.01 (2.31) Provision for Deferred Tax (1.12) 0.81 (1.93) Dividend Income on Investments (13.85) (14.34) 0.49 (Profit)/Loss on sale of Investment (4.74) (3.92) (0.82) (Profit)/Loss on Sale of Tangible and Intangible Fixed Assets 0.22 - 0.22 Interest Income (12.50) (8.04) (4.46) Finance Costs 1.43 1.62 (0.19) Unrealised exchange Loss / (Gain) (1.29) (0.19) (1.10) Effect of exchange differences on translation of foreign currency cash & cash equivalent 0.55 0.51 0.04 Allowances for doubtful debts (1.64 ) 0.79 (2.43) Operating profit before Working Capital Changes 263.91 265.80 (1.89) Effects of working capital changes 32.21 23.46 8.75 Income Taxes paid (net) (70.74) (57.58) (13.16) Net cash flow (used in)/generated from operating activities 225.38 231.68 (6.30)

As can be seen from the above table, in fiscal 2014, the Company generated net cash of ` 225.38 crore (` 231.68 crore generated in fiscal 2013) from operating activities. Apart from profit after taxes of ` 202.72 crore in fiscal 2014 (` 201.22 crore in fiscal 2013), the net cash generated includes adjustments for non-cash items like depreciation of ` 36.14 crore in fiscal 2014 (` 27.02 crore in fiscal 2013), provision for income tax ` 57.70 crore in fiscal 2014 (` 60.01 crore in fiscal 2013) and provision for deferred tax ` (1.12) crore in fiscal 2014 (` 0.81 crore in fiscal 2013).

Cash Flow from Investing Activities (Amount in ` Crore)

Particulars 2013-14 2012-13 Change

Dividend Received 1.48 2.83 (1.35) Income from sale of Investment 4.74 3.92 0.82 Interest Received Bank Deposit and others 0.03 2.84 (2.81) Investment in Preference Shares - (5.00) 5.00 Investment in Joint Ventures - (0.75) 0.75 Inter Corporate Deposits Placed (926.60) (817.65) (108.95) Inter Corporate Deposits Refunded 1,110.50 663.75 446.75 Loans to others (2.97) 0.12 (3.09) Deposits with Financial Companies - 10.00 (10.00) Interest received from Intercorporate Deposits / Bonds 12.47 6.62 5.85 Purchase of Mutual Funds (1,758.02) (1,974.71) 216.69 Sale of Mutual funds 1,552.43 1,896.34 (343.91) Fixed Deposit with banks (net) having maturity over three months (0.26) 0.34 (0.60) Proceeds from sale of Tangible and Intangible Fixed Assets 0.11 0.07 0.04 Payment for Purchase of Tangible and Intangible Fixed Assets (43.23) (34.93) (8.30) Net cash flow (used in)/generated from investing activities (49.32) (246.21) 196.89

As can be seen from the above information, in fiscal 2014, the Company used in ` 49.32 crore on investment activities (` 246.21 crore used in fiscal 2013).

20th ANNUAL REPORT 2013 - 14 41 Cash Flow from Financing Activities (Amount in ` Crore)

Particulars 2013-14 2012-13 Change

Proceeds from issue of shares including Premium - 0.54 (0.54) Interest Paid (1.46) (1.58) 0.12 Dividends Paid (including Dividend Tax) (140.70) (79.19) (61.51) Proceeds from Short Term borrowings 217.75 112.90 104.85 Repayment of Short Term borrowings (181.05) (112.67) (68.38) Repayment of Long Term borrowings (0.47) (0.50) 0.03 Net cash flow (used in)/generated from financing activities (105.93) (80.50) (25.43)

As can be seen from the above information, in fiscal 2014, the Company used in ` 105.93 crore on financing activities (` 80.50 crore used in fiscal 2013).

Cash Position

Cash and cash equivalents as on March 31, 2014 amounted to ` 591.80 crore (` 487.93 crore as at March 31, 2013). Cash and cash equivalents include investments in preferences shares, bonds, mutual funds, inter corporate deposits, deposits with financial institutions and bills of exchanges.

Tata Technologies Ltd. (CONSOLIDATED)

The Management Discussion and Analysis below relates to the consolidated financial statements of the Company (includes the results of its subsidiaries and the Company's share in Joint Venture Company). The Discussion should be read in conjunction with the consolidated financial statements and related Notes to the Consolidated Accounts of the Company for the year ended March 31, 2014.

2013 - 14 2012 - 13 Particulars % of Variance ` in crore % of Income ` in crore % of Income

INCOME Income from Services 1,799.21 75.13% 1,511.64 73.90% 19.02% Sale of Products 542.35 22.65% 476.39 23.29% 13.85% Commssion Income 2.89 0.12% 6.97 0.34% -58.54% Revenue from Operations 2,344.45 97.90% 1,995.00 97.53% 17.52% Other Income 50.28 2.10% 50.42 2.47% -0.28% Total Income 2,394.73 100.00% 2,045.42 100.00% 17.08%

EXPENDITURE Cost of Traded Products 402.23 16.80% 349.40 17.08% 15.12% Consultancy fees, Softwares and others 367.47 15.34% 281.25 13.76% 30.66% Employee Benefit Expenses 1,055.21 44.06% 847.90 41.45% 24.45% Other Expenses 176.48 7.37% 133.73 6.54% 31.97% Total Expenditure 2,001.39 83.57% 1,612.28 78.82% 24.13%

Profit before Finance Charges, Depreciation and Taxes 393.34 16.43% 433.14 21.17% -9.19% Finance Cost 7.66 0.32% 7.62 0.37% 0.52% Depreciation and amortization 48.11 2.01% 33.09 1.62% 45.39% Profit before Taxes 337.57 14.10% 392.43 19.19% -13.98% Provision for taxes including deferred tax 64.35 2.69% 91.70 4.48% -29.83% Net Profit from Operations after taxes 273.22 11.42% 300.73 14.70% -9.15%

INCOME

Income from Operations The Company's revenue increased in fiscal 2014 to ` 2,344.45 crore from ` 1,995 crore in fiscal 2013, registering a growth of 17.52%. Services revenue was 75.13% of total income (73.90% in fiscal 2013) and increased by 19.02% from ` 1,511.64 crore in fiscal 2013 to ` 1,799.21 crore in fiscal 2014. Consolidated revenues from sale of products increased by 13.85% from ` 476.39 crore in fiscal 2013 to ` 542.35 crore in fiscal 2014. Commission income on sale of products reduced to ` 2.89 crore in fiscal 2014 from ` 6.97 crore in fiscal 2013.

42 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Revenue by Segments: (Amount in ` Crore)

% of % of Geography 2013-14 2012-13 Revenue Revenue

India 823.39 35.12% 680.46 34.11% USA 629.90 26.87% 557.63 27.95% UK 663.97 28.32% 576.55 28.90% Rest of Europe 173.86 7.42% 146.33 7.33% Rest of the World 53.33 2.26% 34.03 1.71% Total 2,344.45 100.00% 1,995.00 100.00%

Other Income Consolidated 'Other Income' in fiscal 2014 decreased to ` 50.28 crore from ` 50.42 crore in fiscal 2013. In terms of total income, 'other Income' has gone down from 2.47% in fiscal 2013 to 2.10% in fiscal 2014. Other income has gone down due to decrease in write back of provisions no longer required of ` 7.31 crore in fiscal 2014 as compared to ` 13.37 crore in fiscal 2013.

EXPENDITURE

Employee Benefit Expenses The consolidated total employee benefit expenses for fiscal 2014 was ` 1,055.21 crore, an increase of 24.45% over ` 847.90 crore in fiscal 2013. Employee costs as a percentage of total income was 44.06% in fiscal 2014 (41.45% in fiscal 2013). This increase is attributable to yearly increments & exchange rate impact on foreign salaries. The number of employees as at March 31, 2014 was 6,614 (6,291 as at March 31, 2013).

Other expenses Other Expenses increased from ` 133.73 crore in fiscal 2013 to ` 176.48 crore in fiscal 2014. The increase is primarily due to increase of Rent from ` 16.19 crore in fiscal 2013 to ` 28.88 crore in fiscal 2014, AMC charges from ` 9.94 crore in fiscal 2013 to ` 16.98 crore in fiscal 2014 and Bad Debts written off from ` 1.46 crore in fiscal 2013 to ` 11.94 crore in fiscal 2014. In terms of total income, other expenses increased from 6.54% in fiscal 2013 to 7.37% in fiscal 2014.

Profit before Finance cost, Depreciation and amortization and Taxes The profit before finance cost, depreciation and amortization, taxes (PBIDT) in fiscal 2014 was ` 393.34 crore, a decrease of 9.19% from ` 433.14 crore in fiscal 2013. The profit as a percentage of total income was 16.43% in fiscal 2014 (21.17% in fiscal 2013). The decrease in the PBIDT as a percentage of total income in fiscal 2014 is attributable to increase in operating cost, particularly employee costs and other expenses.

Finance Cost Finance cost marginally increased from ` 7.62 crore in fiscal 2013 to ` 7.66 crore in fiscal 2014. In terms of percentage of total income, finance cost has come down from 0.37% in fiscal 2013 to 0.32% in fiscal 2014.

Depreciation and amortization Depreciation and amortization charge increased from ` 33.09 crore in fiscal 2013 to ` 48.11 crore in fiscal 2014, an increase of 45.39%. The increase is attributable to commencement of business operations of SEZ unit 2 which became operational in April 2013. In terms of total income the depreciation and amortization charge was 2.01% in fiscal 2014 and 1.62% in fiscal 2013.

Profit before Taxes The Profit before Taxes in fiscal 2014 was ` 337.57crore, a decrease of 13.98% from ` 392.43 crore in fiscal 2013. In terms of total income the profit went down from 19.19% in fiscal 2013 to 14.10% in fiscal 2014.

Provision for Taxation Income tax expense comprises tax on income from operations in India and foreign tax jurisdictions. Income tax payable in India is determined in accordance with the provisions of the Income Tax Act, 1961. Tax expenses relating to overseas operations are determined in accordance with tax laws applicable in countries where such operations are carried out. The Company's consolidated tax expense in fiscal 2014 decreased to ` 64.35 crore from ` 91.70 crore in fiscal 2013. This represented 2.69% of the total income in fiscal 2014 (4.48 % in fiscal 2013). The effective tax rate (total tax expenses including deferred tax/profit before tax*100) in fiscal 2014 decreased to 19.06% from 23.37% in fiscal 2013.

20th ANNUAL REPORT 2013 - 14 43 Net Profit after taxes from operations The Company's net profit after taxes from operations (Consolidated) registered a degrowth of 9.15% from ` 300.73 crore in fiscal 2013 to ` 273.22 crore in fiscal 2014. Net profit margin on the total income went down from 14.70% in fiscal 2013 to 11.42 % in fiscal 2014, a decrease in net profit margin of 3.28%.

FINANCIAL POSITION - Tata Technologies Ltd. (CONSOLIDATED)

Share Capital (Amount in ` Crore)

Particulars As at March 31, 2014 As at March 31, 2013

Authorized : 60,000,000 ordinary shares of ` 10/- each 60.00 60.00 (P.Y. 60,000,000 ordinary shares of ` 10/- each) 700,000 0.01% Cumulative Non-participative Compulsorily convertible Preference Shares of Rs. 10/- each. 0.70 0.70 (P.Y. 700,000 0.01% Cumulative Non-participative Compulsorily convertible Preference Shares of Rs. 10/- each) Total 60.70 60.70

Issued, Subscribed and Paid-up : 43.02 43.02 43,024,138 equity shares of Rs. 10/- each (P.Y. 43,023,538 equity shares of Rs. 10/- each) Total 43.02 43.02

During the year, the Company did not increase authorized capital of ordinary shares and Cumulative Non Participative Compulsorily Convertible Preference Shares. The authorized equity share capital as on March 31, 2014 was ` 60 crore, divided into 60 Mn equity shares of ` 10 each (` 60 crore as at March 31, 2013, divided into 60 Mn equity shares of ` 10 each). The issued, subscribed and paid-up share capital as on March 31, 2014 was ` 43.02 crore. During the year, the Company issued equity shares to employees (under ESOP Scheme 2001). Consequently, the issued, subscribed and paid up capital of the Company increased by ` 0.0006 crore in fiscal 2014. Details of options granted, outstanding and vested as at March 31, 2014 are provided in this Annual Report.

Reserves and Surplus A summary of Reserves and Surplus is given below: (Amount in ` Crore)

Particulars As at March 31, 2014 As at March 31, 2013

Securities Premium 350.50 350.50 Capital Reserve 0.63 0.63 Translation Reserves 127.90 22.04 General Reserves 90.83 69.83 Legal Reserves 0.33 - Surplus i.e. balance in Profit and loss account 567.43 466.85 Total 1,137.62 909.85

Securities Premium Account as on March 31, 2013 stood at ` 350.50 crore. As on March 31, 2014 the balance in this account stood at ` 350.50 crore. The additions (net) to the Securities Premium Account of ` 0.003 crore during the year is primarily on account of premium received on exercise of options under ESOP Scheme.

During 2010, based on the approval of Shareholders of the Company at the Extra-Ordinary General Meeting held on March 5, 2010 and the Order of the Honourable High Court of Judicature at Mumbai dated April 16, 2010, the Company had utilized balance in the securities premium account to the tune of ` 46.66 Crore towards one time charges/cost (including change in accounting policy for provision for doubtful debts) incurred by the Company and its subsidiary companies. The amounts relating to the Company amounting to ` 17.32 Crore had been adjusted to the Securities Premium Account. An amount of ` 29.34 Crore equivalent to the total amount of adjustments relating to the subsidiaries had been identified and segregated from the balance in the Securities Premium Account for adjustment on consolidation.

Of this total adjustment made, ` 1.58 Crore and ` 16.58 Crore related to provision for doubtful debts of the Company and its subsidiary companies respectively on account of change in accounting with regard to provision for doubtful debts.

44 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION During the year ended March 31, 2014, the Company and its subsidiary companies have received amounts aggregating to ` Nil (` 0.02 Crore for the year ended March 31, 2013) against the balances adjusted in the securities premium account as above. Consequently, such excess provisions for doubtful debts on account of the said collections have been written back to the securities premium account.

Capital Reserve Account as on March 31, 2014 and as at March 31, 2013 stood at ` 0.63 crore. There is no change in the said balance as compared to previous year.

Out of the profits in fiscal 2014, an amount of ` 21 crore (` 21 crore in fiscal 2013) was transferred to General Reserves resulting in a closing balance of ` 90.83 crore as on March 31, 2014 (` 69.83 crore as on March 31, 2013).

The balance in the Profit and Loss Account as on March 31, 2014 stood at ` 567.43 crore (` 466.85 crore as on March 31, 2013), after providing interim and final dividend of ` 129.08 crore and dividend tax of ` 22.46 crore thereon. The total amount of profits appropriated to dividends including dividend tax was ` 151.54 crore as compared to ` 124.98 crore in the previous year.

For the purpose of consolidation, the financial statements of foreign subsidiaries have been translated into its immediate parent company's currency and the same has been on the following basis:

All income and expenses items are converted at the average rate of exchange applicable for the year. All assets and liabilities are translated at the closing rate as on the balance sheet date. The resulting exchange differences on account of translation at the year-end are transferred to translation reserve. As a result, Translation Reserve Account as on March 31, 2014 stood at ` 127.90 crore. As on March 31, 2013 the balance in this account stood at ` 22.04 crore. This has increased as compared to previous year due to exchange rate fluctuations.

Non-Current Liabilities A summary of Non-Current Liabilities is given below:

(Amount in ` Crore)

Particulars As at March 31, 2014 As at March 31, 2013

Long-term Borrowings 199.68 144.92 Deferred Tax Liabilities (Net) 3.44 4.56 Trade Payables 0.45 0.37 Long-term Provisions 17.61 9.48 Total 221.18 159.33

As mentioned elsewhere in this discussion, all liabilities other than current liabilities have been classified as non-current liabilities. Long term borrowings as at the end of fiscal 2014 aggregated ` 199.68 crore (` 144.92 crore at the end of fiscal 2013).

Deferred Tax Liabilities (Net) As stated in Note No. 6, deferred tax assets and liabilities are offset, tax jurisdiction wise. Note No. 6 brings out details of component wise deferred tax balances where the net value results into liability or asset, jurisdiction wise. The deferred tax liability (net) was ` 3.44 crore as at March 31, 2014 (` 4.56 crore as at March 31, 2013).

Trade Payables Trade payables are dues in respect of goods purchased or services received (including from employees, professionals and others under contract) in the normal course of business. Trade Payable shown under noncurrent liabilities represents amount payable towards retention bonus to certain employees. Trade payables were ` 0.45 crore as at March 31, 2014 (` 0.37 crore as at March 31, 2013).

Long Term Provisions Long term provisions primarily represent provisions made towards certain employee benefits (non- funded) such as bhavishya kalyan yojana, medicare, leave encashment etc. Long term provisions as at March 31, 2014 were ` 17.61 crore (` 9.48 crore as at March 31, 2013). The said amount has been accounted based on an independent actuarial valuation as at the end of the year.

20th ANNUAL REPORT 2013 - 14 45 Current liabilities A summary of Current Liabilities is given below: (Amount in ` Crore)

Particulars As at March 31, 2014 As at March 31, 2013

Short-term Borrowings from Banks 131.01 79.17 Trade Payables 385.16 294.53 Other Current Liabilities 192.14 157.00 Short-term Provisions 97.23 83.39 Income Tax Liabilities (Net) 15.73 34.09 Total 821.27 648.18

Short Term Borrowings from banks Short term borrowings from banks represent secured and unsecured loans taken from banks by way of post shipment loans and cash credit borrowings. Short term borrowings from banks were ` 131.01 crore as at March 31, 2014 (` 79.17 crore at March 31, 2013)

Trade Payable Trade payables are dues in respect of goods purchased or services received (including from employees, professionals and others under contract) in the normal course of business. Trade Payable at the end of fiscal 2014 aggregated ` 385.16 crore (` 294.53 crore at the end of fiscal 2013).

Other Current Liabilities Major portion of other current liabilities represents current maturities of long term debts, dues payable to statutory authorities and advance received from the customers. Other current liabilities at the end of fiscal 2014 aggregated ` 192.14 crore (` 157.00 crore at the end of fiscal 2013). The said amount has gone up primarily due to increase in statutory dues. Current maturities of long term debts as at March 2014 was ` 79.88 crore (` 72.75 crore in fiscal 2013).

Short Term Provisions Short term provisions represent provisions made towards employee benefits (current portion), provision for final dividend and dividend tax on final dividend. Short term provisions as at March 31, 2014 were ` 97.23 crore (` 83.39 crore as at March 31, 2013). The said amount has been accounted based on an independent actuarial valuation as at the end of the year.

Income Tax Liability (Net) Income Tax liabilities (net) as on March 31, 2014, was ` 15.73 crore (` 34.09 crore as on March 31, 2013). Income tax provisions/liabilities have been made based on the applicable tax laws. Income tax liability has gone down as compared to the previous year due to decrease in taxable profits.

Fixed Assets Addition to the Gross Block of tangible assets excluding capital work-in progress and exchange fluctuations in fiscal 2014 amounted to ` 34.91 crore (` 14.56 crore in fiscal 2013). Details of additions in fiscal 2014 were as under:

(a) Buildings ` 0.04 crore (` Nil in fiscal 2013), (b) Plant and machinery-owned ` 2.60 crore (` 0.94 crore in fiscal 2013) (c) Computers ` 23.45 crore (` 9.27 crore in fiscal 2013) (d) Furniture and fixtures ` 3.41 crore (` 2.56 crore in fiscal 2013), (e) Vehicles ` 0.90 crore (` 0.17 crore in fiscal 2013) and (f) Lease hold improvements ` 4.51 crore (` 1.62 crore in fiscal 2013).

The amount in capital work-in-progress was ` 0.57 crore as on March 31, 2014 (` 13.67 crore as on March 31, 2013). The Company has a capital commitment towards tangible assets of ` 11.75 crore as at March 31, 2014 as compared to ` 9.49 crore as at March 31, 2013.

Intangible assets primarily represent cost of software licenses (other than internally generated). During the year, the Company added ` 24.31 crore to the gross block of intangible assets (software licenses). During the previous year, the Company added ` 20.20 crore to gross block assets of the Company. The Company has a capital commitment of ` 2.51 crore as at March 31, 2014 as compared to ` 8.59 crore as at March 31, 2013 towards intangible assets.

46 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Goodwill on Consolidation Goodwill on consolidation as at March 31, 2014 was ` 645.35 crore (` 404.60 crore as at March 31, 2013). This amount is appearing in the books of Tata Technologies Pte Ltd on account of INCAT acquisition. For the purpose of consolidation, the said amount has been translated. Consequently, on account of translation impact there is a movement in this account in fiscal 2014 as compared to fiscal 2013. Goodwill is tested for impairment. The management does not foresee any risk of impairment on the carrying value of goodwill as at March 31, 2014. Details of the movement have been provided in the notes to accounts of consolidated financial statements. During the year, the Company acquired Cambric Holdings Inc through Tata Technologies Inc, an indirect subsidiary. Consideration paid in excess of net assets and liabilities acquired have been treated as goodwill. The net excess paid amounts to ` 155.37 crore including translation impact of ` 15.77 crore.

Non-Current Investments During the year, the Company withdrew the investments in bonds and units of mutual funds. These are typically investments in long -term funds/bonds to gainfully use the excess cash balance with the Company. Investments in bonds, preference shares and mutual funds aggregated ` 10.00 crore as on March 31, 2014 (` 22.50 crore as on March 31, 2013).

Deferred Tax Asset (Net) Deferred tax asset (net) as at March 31, 2014 was ` 14.34 crore (` 6.83 crore as at March 31, 2013). Details of deferred tax asset have been given in Note 6 of the financial statements of the Company.

Long Term Loans and Advances Long Term Loans and Advances as at March 31, 2014 was ` 40.42 crore (As at March 31, 2013 was ` 24.36 crore). The said amount has gone up due to increase of loan to others from ` 16.11 crore as at March 31, 2013 to ` 33.28 crore as at March 31, 2014.

Income Tax Assets (net) Income tax assets (net) were ` 26.36 crore as at March 31, 2014 (` 13.34 crore as at March, 31 2013). Income tax assets (net) have increased as compared to the previous year due to excess of withholding tax from the customers than the provision for income tax.

Current assets A summary of Current assets is given below: (Amount in ` Crore)

Particulars As at March 31, 2014 As at March 31, 2013

Current Investments 492.90 262.46 Inventories - 0.06 Trade Receivables 307.01 315.71 Cash and Bank Balances 465.45 306.15 Other Current Assets 73.90 80.28 Short-term loans and advances 6.94 189.58 Current Income Tax Assets 6.86 8.59 Total 1,353.06 1,162.83

Current Investments As reported elsewhere in this report, during the year, the Company invested in units of mutual funds. These are typically investments in short -term funds to gainfully use the excess cash balance with the Company. Current Investments as at March 31, 2014 was ` 492.90 crore (` 262.46 crore as at March 31, 2013).

Inventories The Company had inventories of ` Nil as at March 31, 2014 (` 0.06 crore as at March 31, 2013).The inventory constitutes of hardware and software products.

Trade Receivables Trade receivables as at March 31, 2014 aggregated ` 307.01 crore (net of provision for doubtful debts) (` 315.71 crore as at March 31, 2013). As a percentage of total income, sundry debtors were at 12.82% as at March 31, 2014 as compared to 15.43% as at March 31, 2013. The Company provides provision for doubtful debts as a percentage of the outstanding debts based on ageing. The cumulative provision towards bad and doubtful debts as on March 31, 2014 stood at ` 10.68 crore (` 15.97 crore as at March 31, 2013).

Cash and Bank Balances Cash and bank balances include cash and cash equivalents and other bank balances. The Company's Cash and Bank balance of ` 465.45 crore as on March 31, 2014 (` 306.15 crore as on March 31, 2013). The cash and cash equivalents aggregated ` 460.44 crore as on March 31, 2014 (` 297.52 crore as on March 31, 2013). Other bank balances at the end of fiscal 2014 aggregated ` 5.01 crore (` 8.63 crore at the end of fiscal 2013)

20th ANNUAL REPORT 2013 - 14 47 Other Current assets Other current assets as on March 31, 2014 were ` 73.90 crore (` 80.28 crore as at March 31, 2013). Significant items of other current assets were, Unbilled revenue ` 24.94 crore as at March 31, 2014 (` 33.70 crore as at March 31, 2013), prepaid expenses ` 24.72 crore as at March 31, 2014 (` 26.64 crore as at March 31, 2013) and Advances to suppliers & contractors ` 22.80 crore as at March 31, 2014 (` 16.39 crore as at March 31, 2013).

Short term Loans and advances Short term loans and advances as on March 31, 2014 were ` 6.94 crore (` 189.58 crore as at March 31, 2013). The decrease is mainly on account of withdrawal of inter corporate deposits.

Current Income Tax Assets Current Income Tax as on March 31, 2014 were ` 6.86 crore (` 8.59 crore as at March 31, 2013).

Cash Flow - Tata Technologies Ltd. (Consolidated)

Cash Flow from Operating Activities (Consolidated)

(Amount in `Crore)

Particulars 2013-14 2012-13 Change

Net Profit after Taxation and Extraordinary Items 273.22 300.73 (27.51) Depreciation and amortization 48.11 33.09 15.02 Disallowance of TDS Abroad 0.28 0.30 (0.02) Provision for Wealth Taxes 0.01 0.01 - Provision for Income Tax 72.15 90.51 (18.36) Provision for Deferred Tax (7.80) 1.19 (8.99) Dividend Income on Investments (13.85) (14.34) 0.49 (Profit)/Loss on sale of Investment (4.74) (3.92) (0.82) (Profit)/Loss on Sale of Tangible and Intangible Fixed Assets 0.22 - 0.22 Finance Costs 7.66 7.62 0.04 Interest Income (14.40) (11.38) (3.02) Unrealised exchange Loss / (Gain) (2.15) (0.52) (1.63) Effect of exchange differences on translation of foreign currency cash & cash equivalent (0.23) (0.40) 0.17 Allowances for doubtful debts (6.99) (1.19) (5.80) Operating profit before Working Capital Changes 351.49 401.70 (50.21) Effects of working capital changes 111.48 25.69 85.79 Income Taxes paid (net) (98.77) (73.49) (25.28) Net cash flow (used in)/generated from operating activities 364.20 353.90 10.30

As can be seen from the above table, in fiscal 2014, the Company generated net cash of ` 364.20 crore (` 353.90 crore in fiscal 2013) from operating activities.

48 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Cash Flow from Investing Activities (Consolidated) (Amount in ` Crore)

Particulars 2013-14 2012-13 Change

Proceeds from sale of Tangible and Intangible Fixed Assets 0.30 0.07 0.23 Dividend Received 1.48 2.83 (1.35) Income from sale of Investment 4.74 3.92 0.82 Interest Received 1.93 6.17 (4.24) Payment for Purchase of Tangible and Intangible Fixed Assets (48.58) (40.91) (7.67) Investment in Preference Shares - (5.00) 5.00 Inter Corporate Deposits Placed (926.60) (817.65) (108.95) Inter Corporate Deposits Refunded 1,110.50 663.75 446.75 Loans to others (2.97) 0.12 (3.09) Interest received from Intercorporate Deposit 12.47 6.62 5.85 Deposits With Financial Companies - 10.00 (10.00) Purchase of Mutual Funds (1,758.02) (1,974.71) 216.69 Sale of Mutual funds 1,552.43 1,896.34 (343.91) Addition to Fixed Deposit with banks (net) having maturity over three months (2.93) (8.88) 5.95 Repayment of Fixed Deposit with banks (net) having maturity over three months 6.84 51.31 (44.47) Acquisition of Cambric Holding Inc. (184.56) - (184.56) Net cash flow (used in)/generated from investing activities (232.97) (206.02) (26.95)

In fiscal 2014 the Company used in ` 232.97 crore on investment activities (` 206.02 crore used in fiscal 2013).

Consolidated Cash Flow from financing activities

(Amount in ` Crore)

Particulars 2013-14 2012-13 Change

Proceeds from issue of shares including Premium - 0.51 (0.51) Interest Paid (7.87) (7.72) (0.15) Dividends Paid (including Dividend Tax) (140.70) (79.19) (61.51) Proceeds from Short Term borrowngs 302.90 143.22 159.68 Repayment of Short Term borrowings (252.45) (145.24) (107.21) Proceeds from Long Term borrowing 119.78 217.12 (97.34) Repayment of Long Term borrowings (80.32) (275.07) 194.75 Net cash flow (used in)/generated from financing activities (58.66) (146.37) 87.71

In fiscal 2014, the Company used in ` 58.66 crore on financing activities (` 146.37 crore used in fiscal 2013). As can be seen from the above, the significant item of cash used in financing activities was on account of lesser repayment of long term borrowings of ` 80.32 crore (` 275.07 crore in fiscal 2013).

Cash Position

Cash and cash equivalents as on March 31, 2014 amounted to ` 968.35 crore (` 775.01 crore as at March 31, 2013). Cash and cash equivalents include investments in preference shares, bonds, mutual funds; inter corporate deposits, deposits with financial institutions and bills of exchanges.

20th ANNUAL REPORT 2013 - 14 49 Corporate Governance Report

1. PHILOSOPHY “The most significant of the challenges is to ensure high standards of ethical conduct and good corporate governance that stakeholders expect from corporate sector.”

CYRUS P MISTRY Chairman Tata Group

The Company has set itself the objective of expanding its capacities and becoming globally competitive in its business. As a part of its growth strategy, the Company believes in adopting the 'best practices' that are followed in the area of Corporate Governance across various geographies. The Company emphasizes the need for full transparency and accountability in all its transactions, in order to protect the interests of its stakeholders. The Board considers itself as a Trustee of its Shareholders and acknowledges its responsibilities towards them for creation and safeguarding their wealth.

Though the Company is not listed and the statutory guidelines on Corporate Governance are not applicable, the Company has voluntarily opted for adoption of various Corporate Governance measures. There have been continuous efforts made to improve and increase the Corporate Governance measures in the recent years, which include among others improved Board reporting, building a strong ethics culture with increased focus on implementation of the Tata Code of Conduct, adoption of Anti-Bribery Policy, Gift Policy, Legal Compliances and Audits and commitment to Corporate Sustainability.

The importance of the corporate governance in not only to the listed companies but in unlisted companies as well is emphasized by the Companies Act, 2013, which is a landmark piece of legislation. The New Act is a progressive and forward looking which promises improved corporate governance norms, enhanced disclosures and transparency, facilitation of responsible entrepreneurship, increased accountability of company managements and auditors, protection of interest of investors particularly small and minority investors, better shareholder democracy, facilitation of corporate social responsibility (CSR) and stricter enforcement processes.

The leadership team of the Company is committed to managing the Company in accordance with the organization's Vision, Mission and Values.

2. BOARD OF DIRECTORS

As a guard of the Company's Corporate Governance practices, the Board of Directors of the Company protects the long-term interests of stakeholders of the Company. The Board is the representative of the shareholder to achieve the overall purpose of the organization.

The Board is primarily responsible to provide and evaluate the strategic direction of the Company's management policies and their effectiveness. The Board's responsibilities further include overseeing the functioning of the Company's top management, monitoring legal compliance and management of the risks related to the Company's operations.

At present the Board consists of five Directors. The Company has an optimum mix of Executive and Non-Executive Directors with eighty percent of the Directors being Non-Executive. The Non-Executive Directors represent various fields with expertise in their respective areas and their positive contribution helps Company to define effective strategies for future growth. The Managing Director along with Executive Management Team in turn implements and monitors the operational strategies, plans, systems and processes to enable the Company to achieve the goals set by the Board.

The calendar of the Board Meetings for the whole year is finalized in advance at the start of the year in consultation with all the Board members. The relevant background materials and information on the agenda items are distributed to the Board members in advance of meetings. All the Committees of the Board report to the Board. The minutes of their meetings are placed before the Board regularly. The Committees also bring to the Board all those matters considered by them to be of special significance. The Board meets the members of the senior management of the Company from time to time. A summary of the Board Decisions made in the last two years is being placed before every quarterly Board Meeting as a good governance practice.

50 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION The Board met Eleven times during the financial year 2013-14 on April 03, 2013, April 30, 2013, May 15, 2013, June 20, 2013, July 16, 2013, August 20, 2013, September 12, 2013, October 09, 2013, October 22, 2013, January 20, 2014 and February 18, 2014. The time gap between any two meetings was less than four months. The quorum of the meetings is either two members or one-third of the members of the Board, whichever is higher. The attendance of the Directors of the Board meetings held during the year is as follows:

No. of Board Meetings Name Designation Held Attended

S Ramadorai Non-Executive Chairman 11 10#

R Gopalakrishnan Non-Executive Director 11 10#

P P Kadle Non-Executive Director 11 10

C Ramakrishnan Non-Executive Director 11 11

P R McGoldrick Managing Director 11 11#

# Includes participation through Video conferencing

Mr R Gopalakrishnan and Mr C Ramakrishnan are liable to retire at the ensuing Annual General Meeting and offer themselves for reappointment. Attention of the Members is invited to the relevant item in the Notice of the Annual General Meeting seeking their approval on their reappointment.

None of the Non-Executive Directors have any material pecuniary relationship or transactions with the Company.

None of the Directors on the Board is a Member of more than 10 Committees or Chairman of more than 5 Committees across all companies in which one is a Director. Chairmanship/Membership of Board Committees for this includes only Audit and Shareholders' Grievance Committees. Necessary disclosures regarding Committee positions in other public companies as at March 31, 2014 have been made by the Directors.

INFORMATION REGARDING DIRECTORS:

Mr S Ramadorai, 69, has served as Chairman of the Company since 2001. He is currently serving as the Vice Chairman-Non Executive of Tata Consultancy Services Limited (TCS). He has been associated with the company, for the past 41 years. He took over as CEO in 1996 when the company's revenues were at $ 155 million and has since then led the company through some of its most exciting phases, including its going public in 2004. In October 2009, he stepped down as CEO, leaving a $ 6 billion global IT services company to his successor, while he took over the mantle of Vice Chairmanship of the company. Today, the company's revenues stand at US $ 13.04 billion for year ended March 31 , 2014, with an employee base of over 300,000 of the world's best trained IT consultants in 46 countries.

Mr Ramadorai is also the Chairman of other Tata Companies - Tata Elxsi Limited and CMC Limited. He is on the Boards of a number of non-Tata Companies and educational institutions - Hindustan Unilever Limited, BSE Limited and the MIT Sloan School of Management (EMSAB).

Mr Ramadorai has been in public service since February 2011. In February 2011, the Government had appointed him as the Adviser to the Prime Minister in the National Council on Skill Development, in the rank of a Cabinet Minister, however in June 2013 the Council was subsumed into the NSDA. Currently, he is the Chairman of National Skill Development Agency (NSDA) in the rank of a Cabinet Minister. He is also the Chairman of the National Skill Development Corporation (NSDC), a Public Private Partnership arm of the Government of India for creating large, for-profit vocational institutions.

Mr Ramadorai was awarded the Padma Bhushan in January 2006 in recognition of his commitment and dedication to the IT industry. In April 2009, he was awarded the CBE (Commander of the Order of the British Empire) by Her Majesty Queen Elizabeth II for his contribution to the Indo-British economic relations.

His academic credentials include a Bachelor's degree in Physics from Delhi University (India), a Bachelor of Engineering degree in Electronics and Telecommunications from the Indian Institute of Science, Bangalore (India) and a Master's degree in Computer Science from the University of California–UCLA (USA). In 1993, he attended the Sloan School of Management's highly acclaimed Senior Executive Development Program.

Mr Ramadorai who is a well-recognized global leader and technocrat has participated in the Indian IT journey from a mere idea in 1960's to a mature industry today. Mr Ramadorai has captured this exciting journey in a book

20th ANNUAL REPORT 2013 - 14 51 titled as 'The TCS Story…and beyond' which was published in 2011 and remained on top of the charts for several months.

Public Companies: Tata Industries Limited, Tata Consultancy Services Limited, Tata Elxsi Limited, CMC Limited, Hindustan Unilever Limited, Piramal Enterprises Limited, Tata Teleservices (Maharashtra) Limited, Tata Communications Limited, Tata Advanced Systems Limited, Asian Paints Limited, Bombay Stock Exchange Limited, Tata Aerospace Systems Limited and Tata Lockheed Martin Aerostructures Limited

Private Companies: Air Asia (India) Private Limited

Foreign Companies: Tata Communications International Pte Limited (Singapore), Tata America International Corporation, US, Computational Research Laboraties Inc.

Non-Profit making Companies: National Skill Development Agency, Breach Candy Hospital Trust, Teach to lead, Tata Institute of Social Sciences and Sir Dorabji Tata Trust nominee on the Council of National Institute of Advanced Studies (NIAS) Bengaluru, National Skill Development Corporation.

Memberships and Chairmanships of Audit Committee in other Public Companies: Tata Elxsi Limited, Hindustan Unilever Limited, Tata Teleservices (Maharashtra) Limited, Tata Advanced Systems Limited and Bombay Stock Exchange Limited.

Memberships and Chairmanships of Investor Grievances Committee in other Public Companies: Tata Consultancy Services Limited and Bombay Stock Exchange Limited.

Mr Ramadorai held 132,000 equity shares of the Company as on March 31, 2014 constituting 0.31% of the paid-up capital of the Company. No new stock options were granted to him and no stock options were exercised by him during the year ended March 31, 2014.

Mr P R McGoldrick, 64, has over 43 years of experience in information technology and is responsible for Tata Technologies as its Chief Executive Officer and Managing Director. He holds a Master's degree in Computer Science from Stanford University, USA and completed the Harvard Business School Advanced Management Program (AMP 109).

Before joining the Tata Group in 1981, he had spent 11 years at Lawrence Livermore National Laboratory in the United States where he had technical responsibility for several complex information systems projects. He also provided consulting to computer companies throughout the United States on project management, advanced products, multiprocessor computer systems, man-machine interfaces and improved software productivity.

Other Directorships:

Public Companies: Tata Elxsi Limited

Foreign Companies: Tata Technologies Pte Limited, Singapore, INCAT International Plc, UK, Tata Technologies Inc, US, Tata Technologies (Thailand) Limited, Thailand, RNT Associates International Pte Limited, Singapore, Tata Technologies Europe Limited, UK and Tata Technologies de Mexico S.A. de C.V., Mexico, Cambric Holdings Inc. USA, and Cambric Corporation Inc USA

Mr McGoldrick held 5,60,000 equity shares of the Company directly, constituting 1.30% of the paid-up capital of the Company and 40,000 equity shares constituting 0.09% via Barclays Wealth Corporate Services (Guernsey) Limited as on March 31, 2014. No new stock options were granted to him and no stock options were exercised by him during the year ended March 31, 2014.

Mr R Gopalakrishnan, 68, is a Director of Tata Sons Limited. Mr R Gopalakrishnan has been a professional manager from 1967 onwards and has served 31 years in Unilever and 15 years in Tata group.

Besides being on the Board of various Tata & non-Tata Companies, he is also the Chairman of Tata AutoComp Systems and Rallis India Limited and a Vice-Chairman of Tata Chemicals Limited.

Prior to joining the Tata Group he was the Chairman of Unilever Arabia, in Bangalore as the Managing Director of Brooke Bond Lipton India and Vice-Chairman of Hindustan Unilever Limited.

Mr Gopalakrishnan has been a regular speaker at the guest lectures in India as well as abroad. He has taught a course entitled LWNT-Learning What's Not Taught at B-Schools.

He has written about 200,000 words through papers, articles in newspapers and journals. He has authored best selling books, some of which have been translated into Chinese, Hindi and Tamil.

52 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION His books include “The case of the bonsai manager: Lessons for managers on intuition”; “When the penny drops: Learning what is not taught”; “What the CEO really wants from you: The 4 As for managerial success”; and “A comma in a sentence: The extra-ordinary story of an ordinary family over six generations”.

Mr Gopalakrishnan holds a Bachelor's degree in Science and a B. Tech (Electronics) degree from the Indian Institute of Technology (IIT), Kharagpur. He has also attended the Advanced Management Program at Harvard Business School. He is a Past President of All India Management Association.

Other Directorships:

Public Companies: Tata Sons Limited, Tata Chemicals Limited, Tata Power Co. Limited, Rallis India Limited, Tata Autocomp Systems Limited, Castrol India Limited, Akzo Nobel India Limited, Advinus Therapeutics Limited and Metahelix Life Sciences Limited

Private Companies: ABP Private Limited

Foreign Companies: Hemas Holdings PLC, IMACID S.A. and Trust Energy Resources Pte Limited, Singapore

Non-Profit Making Organizations: Cathedral & John cannon School, Indian Institute of Technology, Bhubaneshwar, Goa Institute of Management, Goa

Memberships of Audit Committee in other Public and Private Companies: Castrol India Limited

Mr Gopalakrishnan held 64,200 equity shares of the Company as on March 31, 2014, constituting 0.14% of the paid-up capital of the Company. No stock options were exercised by him and no new stock options were granted to him during the year ended March 31, 2014.

Mr Praveen P Kadle, 57, is the Managing Director & CEO of Tata Capital Limited, a subsidiary of Tata Sons Limited. Tata Capital is Tata's foray into the financial services space covering products and services ranging from retail and commercial lending, distribution and broking, wealth management, investment banking and private equity.

Mr Kadle is a Hons Graduate in Commerce & Accountancy from the Bombay University and has qualified as a Chartered Accountant, Cost & Works Accountant and Company Secretary.

Mr Kadle has been working for the Tata's for the last 22 years. For the first 5 years, he was the Chief Financial Officer of Tata's Joint Venture with IBM in India. Thereafter, in 1996 he was transferred to Tata Motors Limited as the Vice President (Finance) and in the year 2001 he was promoted to the Board of Tata Motors Limited as Executive Director – Finance and Corporate Affairs.

Mr Kadle has played a major role in the turnaround and growth of Tata Motors. He was also instrumental in the turnaround and financial restructuring of the erstwhile Tata Finance Limited. While working in Tata Motors, he was also instrumental in setting up and guiding operations of Tata Technologies and TELCON (a Tata Motors – Hitachi JV) which have become market leaders in the engineering design space and in the construction equipment business in India.

During his tenure at Tata Motors, Mr Kadle was a part of the senior leadership team that managed the cross-border acquisitions like Daewoo Truck Company of South Korea, INCAT Technologies of UK and Jaguar-Land Rover of UK. He also led the Fund raising programme of US$ 5 billion during this period.

Prior to his joining the Tata's, Mr Kadle worked as the CEO and member of the Board of Garware-Wall Ropes Limited, which is a synthetic yarn, industrial fabric & synthetic cordage company having global operations with a consistent profit track record.

Mr Kadle is a Board member on various Tata and non-Tata companies. He contributes to many industry and economic bodies both domestic and international. These include the position on the Advisory Board of Japan's Institute for Indian Economic Studies (IIES) and as a member of the Advisory Board of Centre for Strategic Leadership - NUS Business School, Singapore. Additionally, he is also actively involved with various Public Charitable institutions notably as the Board Member and Honorary Treasurer of Child Rights and You (CRY).

Mr Kadle has received a number of awards in recognition of his outstanding contribution to Tata Motors Limited, which are: CNBC-TV18, the Country's best performing CFO in the Auto & Auto Ancillaries sector for 2006; 'The Best CFO of the year 2005' in India by Business Today; the 'CFO of the year 2004' by IMA (formerly known as Economist Intelligence Unit) and has been recently inducted as Founding member to the CFO Hall of Fame in India.

20th ANNUAL REPORT 2013 - 14 53 Other Directorships:

Public Companies: Tata Capital Limited, Tata Securities Limited, e-Nxt Financials Limited, TC Travel & Services Limited, Tata Capital Housing Finance Limited, Tata Autocomp Systems Limited, Tata Toyo Radiator Limited, Tata Capital Forex Limited, Tata Capital Financial Services Limited, International Paper APPM Limited and Tata Cleantech Capital Limited.

Private Companies: International Asset Reconstruction Company Private Limited.

Foreign Companies: INCAT International Plc, UK, Tata Technologies Inc USA, Tata Technologies Pte Limited, Singapore, Tata Capital Pte Limited, Singapore, Tata Capital Markets Pte Limited, Singapore, Tata Capital Advisors Pte Limited, Singapore, Tata Technologies Europe Limited, UK and Tata Capital Plc, UK.

Memberships and Chairmanships of Audit Committee in other Public Companies: TC Travel and Services Limited, Tata AutoComp Systems Limited, International Paper APPM Limited, Tata Cleantech Capital Limited and Tata Capital Forex Limited.

Memberships and Chairmanships of Investor Grievances Committee in other Public Companies: Tata Capital Limited and Tata Capital Financial Services Limited.

Mr Kadle held 139,200 equity shares of the Company as on March 31, 2014, constituting 0.32% of the paid-up capital of the Company. No stock options were exercised by him and no new stock options were granted to him during the year ended March 31, 2014.

Mr C Ramakrishnan, 58, was appointed as the Chief Financial Officer of Tata Motors Limited in September 2007, having joined the company in 1980 as the Junior Accounts Officer. He handled corporate treasury and accounting functions with management accounting/MIS. Following a two year company-wide IT project responsibility covering R&D, Manufacturing, Sourcing and Sales and Services, he had worked in the Tata Group Chairman's Office for more than 7 years before being appointed as the Chief Financial Officer of Tata Motors Limited. As the Chief Financial Officer of Tata Motors Limited, he is responsible for Finance, Accounts, Taxation, Business Planning, Investor Relations, Treasury, CRM & DMS and IT.

Mr Ramakrishnan holds a Bachelor's degree in Commerce and is a Chartered Accountant and Cost Accountant.

He was awarded the Indian Industries Best CFO Award in CNBC TV18 CFO awards held in October 2010 and was also conferred with the CFO of the year for India award, by Asset Triple A Transaction Banking Awards 2011.

The Institute of Chartered Accountants of India (ICAI) has conferred Mr C Ramakrishnan with the prestigious Business Achiever Award 2011, in the industry category. This award is the highest honour from the Institute to Chartered Accountants for contributions and achievements beyond Finance in business strategy and growth.

In April 2012, he was conferred with the Business Today – Yes Bank India's Best CFO of the year 2011-12 and was also presented with the Best Transformation Agent Award in the large companies category.

On September 06, 2013, he was appointed on the Academic Advisory Committee of Birla Institute of Management Technology.

Other Directorships:

Public Companies: Tata Cummins Limited, Sheba Properties Limited, Tata Motors Finance Limited, Fiat India Automobiles Limited and Jaguar Land Rover India Limited

Foreign Companies: Tata Hispano Motors Carrocera SA Spain, TML Holdings Pte Limited, Singapore, Tata Motors (Thailand) Limited, Thailand, Tata Daewoo Commercial Vehicle Company Limited, South Korea, Tata Motors (SA) (Proprietary) Limited, South Africa and Jaguar Land Rover Automotive PLC, U.K.

Memberships and Chairmanships of Audit Committee in other Public Companies: Tata Cummins Limited, Sheba Properties Limited, Fiat India Automobiles Limited, Tata Motors Finance Limited and Jaguar Land Rover India Limited and Alternate to Mr Nasser Munjee on the Audit Committee of Jaguar Land Rover Automotive Plc, UK.

Mr. Ramakrishnan held 44,200 equity shares of the Company as on March 31, 2014, constituting 0.10% of the paid-up capital of the Company. No stock options were exercised by him and no new stock options were granted to him during the year ended March 31, 2014.

54 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION 3. AUDIT COMMITTEE

The Audit Committee comprises three Non-Executive Directors, all of whom are financially literate. The Audit Committee met Eight (8) times during the year 2013-14, on May 08, 2013, May 15, 2013, July 09, 2013, July 16, 2013, October 22, 2013, November 21, 2013, January 20, 2014 and March 13, 2014. Members of the Audit Committee and the number of meetings attended by each Director for the financial year 2013-14 are as follows:

No. of Meetings Name Designation Held Attended P P Kadle Non-Executive Chairman 8 6 S Ramadorai Non-Executive Director 8 7# C Ramakrishnan Non-Executive Director 8 7

# Includes participation through Video conferencing

The Internal Auditors, M/s Ernst & Young LLP, attended six meetings, the representatives of the Statutory Auditors of the Company, M/s Deloitte Haskins & Sells LLP, Chartered Accountants, attended all meetings and the Chief Financial Officer attended all the meetings. The Chief Internal Auditor of Tata Motors Ltd attended six meetings personally or through representative.

The Company Secretary acts as the Secretary to the Committee Meetings. The quorum of the meetings is either two members or one third of the members of the Committee, whichever is higher.

An Audit Committee Charter has formally been adopted for the Audit Committee outlining its responsibilities in detail. The role of the Audit Committee includes in brief the following:

• To review reports of the Internal Auditor and recommend to the Board.

• To decide on the scope of the Internal Auditors work including the examination of major items of expenditure.

• To meet Statutory and Internal Auditors periodically and discuss their findings, suggestions and other related matters.

• To review the weaknesses in internal controls, if any, reported by the Internal and Statutory Auditors and report to the Board the recommendations relating thereto.

• To act as a link between the Statutory and Internal Auditors and the Board of Directors.

• To recommend a change in the Auditors if in the opinion of the Committee the Auditors have failed to discharge their duties adequately.

• To establish and review accounting policies.

• To ensure resources are conserved and tendencies for extravagance are avoided.

• To review financial statements before submission to the Board.

NON-EXECUTIVE DIRECTORS’ REMUNERATION:

To acknowledge the contribution of the Non-Executive Directors towards the growth of the organization, the Company paid sitting fees of Rs 15,000/- per meeting to all Non-Executive Directors for attending the meetings of the Board, Audit Committee and Compensation & Remuneration Committee. The details of the sitting fees paid to the Directors is as under:

Name Amount in ` S Ramadorai 330,000 R Gopalakrishnan 150,000 P P Kadle 315,000 C Ramakrishnan 345,000 Total 11,40,000

Only sitting fees have been paid to the Non-Executive Directors during the year. No commission has been paid to any Non-Executive Director of the Company.

20th ANNUAL REPORT 2013 - 14 55 4. COMPENSATION AND REMUNERATION COMMITTEE

The Compensation and Remuneration Committee met Five (5) times during the year 2013-14, on April 16, 2013, May 15, 2013, June 21, 2013, July 16, 2013 and October 09, 2013. Members of the Compensation Committee and number of meetings attended by each Director for the financial year 2013-14 are as follows:

No. of Meetings Name Designation Held Attended

S Ramadorai Non-Executive Chairman 5 5#

P P Kadle Non-Executive Director 5 5

C Ramakrishnan Non-Executive Director 5 5

# Includes participation through Video conferencing

Powers of the Compensation and Remuneration Committee:

(i) Deciding upon the remuneration of the Managing Director of the Company;

(ii) Supervising and administrating the Employee Stock Option Plan and ensuring that suitable policies and systems are in place to comply with the guidelines issued by the Securities and Exchange Board of India or any other appropriate authority in connection with the said Scheme.

The quorum of the meetings is either two members or one third of the members of the Committee, whichever is higher.

Terms of appointment and payment of remuneration to the Managing Director, Mr Patrick McGoldrick in Tata Technologies Limited is as under:

Period of Appointment September 01, 2010 to September 08, 2014

Salary Up to a maximum of ` 400,000/- per month

Incentive Remuneration Up to 200% of salary, to be paid at the discretion of the Board

Perquisites and Allowances Provision of hotel accommodation and chauffeur driven car during his stay in India. All expenses in connection with the Company's official business are paid by the Company

Minimum Remuneration Salary, incentive remuneration as specified above

Notice period on either side Agreement can be terminated by either party by giving three months' notice or the Company paying three months' salary in lieu of notice.

5. OTHER KEY BOARD AND MANAGEMENT COMMITTEES

Apart from the Audit Committee and the Compensation & Remuneration Committee, the Company has the following committees:

a. Committee of Directors: Mr P P Kadle, Director, Mr C Ramakrishnan, Director and Mr P R McGoldrick, Managing Director are the members of the Committee. The Committee was constituted by the Board in its meeting on March 09, 2001 for carrying out certain functions pertaining to the day-to-day operations of the Company. The powers of the Committee include evaluation/negotiation of facility agreements for availing working capital facilities within the specified limits, opening and closing of bank accounts, authorization for creating charges on the current assets of the Company, authorization for providing comfort letters or corporate guarantees to banks or financial institutions for funding of Company's subsidiaries, transfer of amounts to and from the Company's Provident Fund, appointment of additional/substitute attorneys, entering into agreement(s) with business partner(s) etc.

b. Stock Allotment Committee: The Board had constituted the Stock Allotment Committee to carry out certain functions in connection with the offer of Company's shares to employees of Company's subsidiaries on private placement basis. Mr P P Kadle, Director, Mr P R McGoldrick, Managing Director and

56 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Mr Warren Harris, President and COO, are the three members of the Committee. The role of the Committee primarily is to finalize/approve letter of offer for private placement of shares to employees of Company's subsidiaries, to determine the employees who will be eligible to participate, allotment of shares, to obtain annual valuation of shares, etc. The Committee is also responsible to provide supervision, approval, direction, recommendation with respect to the Employee Stock Purchase Program (ESPP) as implemented by the Tata Technologies Limited Employees Stock Option Trust and to approve the implementation/transaction documents related to the ESPP and also to remove any difficulty or question that may arise in the implementation of the ESPP scheme.

c. Executive Committee: To provide more effective decision making, the Boards of Tata Technologies Ltd and Tata Technologies Pte Ltd have formed a management committee consisting of Mr P P Kadle, Director, Mr P R McGoldrick, Managing Director and Mr Warren Harris, President and COO.

6. MANAGEMENT OF BUSINESS ETHICS

Tata Technologies has adopted the Tata Code of Conduct (TCOC). The Code of Conduct upholds the highest standards of corporate and personal conduct and is the guiding force on the ethical conduct behind every Tata Company, no matter what business they are in. It establishes the code of ethics that governs all Tata ventures, new and old. The Code of Conduct is communicated to the organization's partners/suppliers through interaction with them. The Company established procedures to deploy TCOC across the organization which promotes and ensures ethical behavior in all stakeholder interactions. The TCOC is disseminated through presentations, circulation of “Code” through various processes such as at the time of employee induction (joining), highlighting the same in posters at strategic locations “Employee Handbook” and a dedicated section as “Management of Business Ethics” on the intranet portal of the Company. To obtain a uniform measurable deployment of the TCOC across all employees and contractors of Tata Technologies, wherever they might exist globally, the Company created a specifically tailored training program on TCOC using 'iGETIT®'. This training program had been added to each employee's 'Learning Path'. The tool not only effectively tracks the number of employees who had undergone the training program but also monitors time taken on the program and each individual's score.

The Company has a committee on Prevention of Sexual Harassment (POSH) and a Whistle Blower Policy in place. The Whistle Blower Policy was adopted in February 2007 in extension of the Tata Code of Conduct (TCOC). Any actual or potential violation of the Code of Conduct, howsoever insignificant or as such, would be a matter of serious concern for the Company. Whistle Blower Policy has been established to provide a mechanism for employees of the Company to approach the Ethics Counselor/Chairman of the Audit Committee of the Company to report any concerns. The Policy has been communicated to all the employees of the Company. Possibility of breach of ethical behavior can be reported by various means to the Ethics Counsel such as by post, mail or phone calls. A dedicated email account [email protected] is available both at the intranet and internet sites for the stakeholders to report any ethical breach. These are then managed by a well laid process. The required actions are implemented through the support functions such as HR, Finance and Legal. Results are reported to the Chief Ethics Counselor on a quarterly basis and are reviewed by the Audit Committee. Apart from encouraging people to report ethical violations, the Company is also trying to establish a culture to report examples of good ethical behavior of employees to bring in ethical positivity at the work place.

The Company has also adopted and implemented the Anti-Bribery and Gift, in line with the Tata Code of Conduct and applicable laws, if any.

The organization structure for the Management of Business Ethics (MBE) in the Company comprises:

a. Ethics Committee b. Chief Ethics Counselor c. Ethics Counselor and d. Chairperson–Prevention of Sexual Harassment (POSH)

The Company received eleven complaints during the year. Two of them were under POSH and all the complaints received were closed. The Ethics Committee has conducted various activities during the year including Ethics Day & Pledge, MBE Awareness Workshops, Customer feedback on Ethical behavior of Company's employees etc.

7. RISK MANAGEMENT

The Company is committed to having a reliable risk management system. The Management is accountable for integration of the risk management practices into day to day activities of Company. Different types of business risks are identified by the top management team and along with risk scores and mitigation measures are reported to the Audit Committee. The Audit Committee periodically reviews the policies on risk assessment and risk management, guidelines to govern the process and the major financial risk exposures and the steps undertaken to control them. Readers are requested to refer the Management Discussion and Analysis Report for more details.

20th ANNUAL REPORT 2013 - 14 57 8. SUBSIDIARY COMPANIES

The Company as on March 31, 2014 had 17 subsidiaries. The details are mentioned elsewhere in the Annual Report. The minutes and resolutions of all the subsidiaries are periodically placed before the Board of Directors of the Company. The attention of the Board is drawn to all significant transactions and arrangements entered into by the subsidiary companies. The following Board meetings/Shareholders meeting of subsidiary companies were held during the year:

Tata Tata Technologies Name of the Tata Technologies Tata Technologies Tata Technologies INCAT INCAT Tata Technologies Technologies de Mexico SA Subsidiary Pte Ltd, (Thailand) Ltd, Europe Ltd, International Plc., GmbH, (Canada) Inc., Inc., de CV, Company Singapore Thailand UK UK Germany Canada USA Mexico Dates of Board May 08, 2013, May 10, 2013, Meetings held Nov. 06, 2013 Nov. 06, 2013 Not held Nov. 06, 2013 Oct. 07, 2013 Not held Mar. 17, 2014 March 31, 2014 during the year Dates of Shareholder June 17, 2013 June 24, 2013 Not Held Sept. 25, 2013 June 17, 2013 Aug. 08, 2013 Not held Not held Meetings/ Resolutions

Name of the Subsidiary Cambric Holdings Cambric Cambric U.K., Company Inc. Corporation Limited

Dates of Board May 29,2013 June 21, 2013 Meetings held July 30, 2013 July 30, 2013 Not held during the year Nov. 21, 2013 Nov. 21, 2013 Dates of Shareholder Not held Not held Sept. 25, 2013 Meetings/ Resolutions

The updates of major decisions of the subsidiary companies are regularly presented before the Board. Following are the key points of subsidiaries which are regularly taken up in the Board meetings:

• Nomination of Directors on Board of each subsidiary; • Minutes of all the meeting of subsidiaries held between two Board meetings; • Major dealings of subsidiaries' investment, fixed assets, loans etc.; • Compliance by subsidiaries with applicable laws of the country and • Business plan of each subsidiary and its periodic update to the Company's Board

9. GENERAL BODY MEETINGS

The details of the General Meetings held in the last three years are as follows:

Financial year AGM/EGM Venue Time Date

2012-13 19th AGM25 , Rajiv Gandhi Infotech Park, 3.30 p.m. June 21, 2013 Hinjawadi, Pune -411057

2011-12 18th AGM25 , Rajiv Gandhi Infotech Park, 3:30 p.m. June 22, 2012 Hinjawadi, Pune -411057

2010-11 17th AGM25 , Rajiv Gandhi Infotech Park, 3:30 p.m. July 27, 2011 Hinjawadi, Pune -411057

2010-11 EGM 25 , Rajiv Gandhi Infotech Park, 4.00 p.m. April 30, 2011 Hinjawadi, Pune -411057

58 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION The details of Special Resolutions passed in the General Meetings in the last three years are as follows:

AGM/EGM Date Special Resolutions

AGM June 22, 2012 i. Alteration of the Articles of Association of the Company

EGM April 30, 2011 i. Issue of equity shares to Alpha TC Holdings Pte Ltd and Tata Trustee Company Ltd., acting in its capacity as Trustee to Tata Capital Growth Fund- I ii. Amendment to the Articles of Association of the Company

Special resolution was passed in the 18th Annual General Meetings of the Company. The resolutions were passed by show of hands and none of the resolutions were passed by way of poll.

Attendance of the Directors at the last AGM held on June 21, 2013:

Name of the Director Attendance at the last AGM

S Ramadorai Yes

R Gopalakrishnan Yes

P P Kadle Yes

C Ramakrishnan Yes

P R McGoldrick Yes

10. DISCLOSURES

10.1 Disclosures on materially significant related party transactions i.e. transactions of the Company of material nature, with its promoters, the Directors or Management or their relatives, etc. that may have potential conflict with the interests of the Company at large:

The particulars of transactions between the Company and the 'Related Parties' are mentioned at Note 25(vi) Related Party Disclosures for the year ended March 31, 2014 of Notes to Accounts mentioned elsewhere in the Annual Report. None of these transactions are likely to have any conflict with the Company's interest.

10.2 Details of the non-compliance by the Company, penalties or strictures imposed on the Company by any statutory authority on any matter related to the capital markets during the past three years – NIL.

10.3 The Certification by the Managing Director (CEO) and Chief Financial Officer (CFO), to the Board, on the true and fair view of the Financial Statements for the year ended March 31, 2014 is annexed hereto.

11. GENERAL SHAREHOLDER INFORMATION

11.1 Registrar and Share Transfer Agents: Investors are requested to take note of the contact details of the Registrars and Share Transfer Agents of the Company, M/s TSR Darashaw Private Ltd:

TSR Darashaw Private Limited 6-10 Haji Moosa Patrawala Industrial Estate, 20, Dr. E. Moses Road, Mahalaxmi, Mumbai- 400011 Tel: +91 22 66568484 Fax: +91 22 66568494 Email: [email protected] Website: www.tsrdarashaw.com

11.2 Share Transfer System: The share transfers received for transferring physical share certificates are processed by the Registrar and Transfer Agents of the Company. The Board ratifies such transfers on a periodical basis.

20th ANNUAL REPORT 2013 - 14 59 11.3 Dematerialization of Shares: The Company has dematerialized its Equity Shares with CDSL and NSDL and the Company's ISIN is INE142M01017. The share transfers of dematerialized shares can be made through your Depository Participant.

11.4 Investor Complaints: A total of 652 investor complaints/queries were received during the year 2013-14. 1 correspondence was outstanding on March 31, 2014 and was attended to and resolved in first week of April, 2014.

11.5 Transfer of unclaimed / unpaid dividends to Investor Education and Protection Fund: Pursuant to the provisions of Section 205A and 205C of the Companies Act, 1956, the dividend which remains unclaimed/unpaid for a period of seven years from the date of transfer to the unpaid dividend account is required to be transferred to the Investor Education and Protection Fund (IEPF) established by the Central Government.

The status of dividend remaining unclaimed is given hereunder:

Unclaimed Dividend Status Whether it Can be claimed from can be claimed

Up to financial Transferred to the No Not Applicable Year 2005-06 IEPF of the Central Government

For the Financial Lying in respective Yes The Company's R&T Agent Years 2006-07 Unpaid and thereafter TSR Darashaw Private Dividend Accounts Limited, address of which is provided above.

The due dates for transfer to IEPF of the dividend remaining unclaimed since 2006-07 are provided hereunder:

Last date for claiming payment from Date of dividend declaration TSR Darashaw Pvt Ltd

27/06/07 01/08/14 31/03/08 06/05/15 21/07/08 26/08/15 17/03/09 22/04/16 20/07/09 25/08/16 21/07/10 05/09/17 21/01/11 21/02/18 27/07/11 27/08/18 17/08/11 22/09/18 31/10/11 06/11/18 23/01/12 23/02/19 22/06/12 28/06/19 18/07/12 24/08/19 26/10/12 04/11/19 05/02/13 07/03/20 25/06/13 31/07/20 22/07/13 28/08/20 28/10/13 04/12/20 27/01/14 05/03/21

60 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION 11.6 Shareholding Pattern as on March 31, 2014

No. of % of the Category No. of Shares Shareholders Paid-up Capital

Tata Motors Limited 1 30,300,600 70.43

Other Tata Entities 5 7,469,748 17.36

Directors 5 939,600 2.18

Employees/Associates/Others 1,886 4,314,190 10.03

Total 1,897 43,024,138 100.00

11.7 Distribution of Shareholding as on March 31, 2014:

Shareholders Share Range of Shares Number % Number %

1 - 100 284 14.97 19,215 0.04

101 - 500 772 40.70 210,332 0.49

501 - 1000 460 24.25 348,068 0.81

1001 - 5000 288 15.18 695,318 1.62

5001 - 10000 47 2.48 324,171 0.75

Above 10000 46 2.42 41,427,034 96.29

Total 1,897 100.00 43,024,138 100.00

11.8 Dematerialization of Shares as on March 31, 2014: The Company's shares are dematerialized through both the Depositories in India viz. National Securities Depository Ltd (NSDL) and Central Depository Services (India) Ltd (CDSL).

Shares of ` 10/- each Shareholders Particulars of shares Number % to total Number % to total Dematerialized form

NSDL 31,728,829 73.75 370 19.50

CDSL 5,979,469 13.90 158 8.33

Sub-total (A) 37,708,298 87.65 528 27.83

Physical Form (B) 5,315,840 12.35 1,369 72.17

Total (A+B) 43,024,138 100.00 1,897 100.00

20th ANNUAL REPORT 2013 - 14 61 11.9 How to manage your shares effectively: The Company's foremost objective is to mitigate / avoid risks relating to shares and related matters, the following are the Company's recommendations to its Members:

i. Dematerialize your Shares: Members are requested to convert their physical holdings into electronic holdings. Holding shares in electronic form helps to achieve immediate transfer of shares. No stamp duty is payable on transfer of shares held in electronic form and risks associated with physical certificates such as forged transfers, fake certificates and bad deliveries are avoided.

ii. Consolidate your Multiple Folios: Members are requested to consolidate their shareholding held under multiple folios. This facilitates one-stop tracking of all corporate benefits on the shares and would reduce time and efforts required to monitor multiple folios.

iii. Confidentiality of Security Details: Folio Nos/DP ID/Client ID should not be disclosed to any unknown persons. Signed blank transfer deeds, delivery instruction slips should not be given to any unknown persons.

iv. Update your Address and bank details: To receive all communication and corporate actions promptly, please update your address, bank details, email id etc., with the Company or Share Transfer Agent or DP, as the case may be.

v. Quote you Folio Number/s: Always quote your folio number/s for any communication in regard to your shares with the Company or Share Transfer Agents, this will ensure speedy and effective processing.

vi. Prevention of Frauds: There is a possibility of fraudulent transactions relating to folios which lie dormant, where the Member is either deceased or has gone abroad. Hence, we urge you to exercise diligence and notify the Company of any change in address, stay abroad or demise of any Member, as and when required.

vii. Monitor holdings regularly: Do not leave your demat account unchecked for long. Periodic statement of holdings should be obtained from the concerned DPs and holdings should be verified.

11.10 Frequently asked Questions: Members are requested to refer the detailed FAQ on general shareholder queries and Dematerialization given elsewhere in this Report.

ADDRESS FOR CORRESPONDENCE: The correspondence to be addressed to the Corporate Registered Office at:

Tata Technologies Ltd Plot No 25, Rajiv Gandhi Infotech Park Hinjawadi, Pune – 411 057, India. Tel: +91 20 6652 9090 Fax: + 91 20 6652 9035 Email: [email protected] Website: www.tatatechnologies.com

COMPANY SECRETARY Anubhav Kapoor General Counsel and Company Secretary Tata Technologies Ltd. Plot No 25, Rajiv Gandhi Infotech Park Hinjawadi, Pune - 411 057, India Tel: + 91 20 6652 9090 Fax: + 91 20 6652 9035 Email: [email protected]

62 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION ANNUAL DECLARATION BY THE CEO ON ADHERENCE TO THE TATA CODE OF CONDUCT & THE ANTI-BRIBERY POLICY AND GIFT POLICY I confirm that Tata Technologies Limited has adopted the Tata Code of Conduct and the same is available on the Company's website www.tatatechnologies.com.

I also confirm that, all the Directors and the Senior Management Personnel of Tata Technologies Limited have affirmed compliance to the Tata Code of Conduct, as applicable to them for the Financial Year ended March 31, 2014.

Sd/- Patrick McGoldrick CEO & Managing Director

Date: May 15, 2014 Place: Pune

CEO AND CFO CERTIFICATE

We, Patrick McGoldrick, Chief Executive Officer (CEO) and Samrat Gupta, Chief Financial Officer (CFO) hereby certify that the financial statements of the Company and its subsidiaries/Joint ventures for the year ended on March 31, 2014 do not contain any false or misleading statement or figures and do not omit any material fact which may make the statements or figures contained therein misleading to the best of our knowledge and belief.

Sd/- Sd/- Patrick McGoldrick Samrat Gupta CEO & Managing Director Chief Financial Officer

Date: May 15, 2014 Place: Mumbai

20th ANNUAL REPORT 2013 - 14 63 INDEPENDENT AUDITORS' REPORT

TO THE MEMBERS OF TATA TECHNOLOGIES LIMITED

Report on the Financial Statements We have audited the accompanying financial statements of TATA TECHNOLOGIES LIMITED (“the Company”), which comprise the Balance Sheet as at 31st March, 2014, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements The Company's Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards notified under the Companies Act, 1956 (“the Act”) (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs) and in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors' Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with the ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal controls relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India: (a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2014; (b) in the case of the Statement of Profit and Loss, of the profit of the Company for the year ended on that date; and (c) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

Report on Other Legal and Regulatory Requirements 1. As required by the Companies (Auditor's Report) Order, 2003 (“the Order”) issued by the Central Government in terms of Section 227(4A) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

2 As required by Section 227(3) of the Act, we report that: (a) We have obtained all the information and explanations which to the best of our knowledge and 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 Company so far as it appears from our examination of those books. (c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account. (d) In our opinion, the Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with the Accounting Standards notified under the Act (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs). (e) On the basis of the written representations received from the directors as on 31st March, 2014 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2014 from being appointed as a director in terms of Section 274(1)(g) of the Act. Sunil S Kothari For Deloitte Haskins & Sells LLP Partner Chartered Accountants (Membership No. 208238) (Firm Registration No. 117366W/W-100018)

Date: May 15, 2014 Place: Pune

64 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION ANNEXURE TO THE INDEPENDENT AUDITORS' REPORT (Referred to in paragraph 1 under 'Report on Other Legal and Regulatory Requirements' section of our report of even date)

(i) Having regard to the nature of the Company's business / activities clauses (iii) (b) to (d), (f) and (g), (v), (vi), (viii), (x), (xii), (xiii), (xiv), (xix) and (xx) of CARO are not applicable.

(ii In respect of its fixed assets:

(a) The Company has maintained proper records showing full particulars, including quantitative details and situation of the fixed assets.

(b) The Company has a program of verification of fixed assets to cover all the items in a phased manner over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, certain fixed assets were physically verified by the Management during the year. According to the information and explanations given to us no material discrepancies were noticed on such verification.

(c) The fixed assets disposed off during the year, in our opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

(iii) In respect of its inventories, in our opinion and according to the information and explanations given to us, the company has maintained proper records of its inventories. Having regard to the explanation that the inventories dealt with by the company are software licenses in demat form where physical verification is not possible, we are unable to comment on matters relating to physical verification of inventories.

(iv) The Company has neither granted nor taken any loans, secured or unsecured, to / from companies, firms or other parties listed in the Register maintained under Section 301 of the Companies Act, 1956.

(v) In our opinion and according to the information and explanations given to us, and having regard to the explanations that some of the items purchased are of a special nature and suitable alternative sources are not readily available for obtaining comparable quotations, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory and fixed assets and the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weakness in such internal control systems.

(vi) In our opinion, the internal audit functions carried out during the year by an external agency appointed by the Management was commensurate with the size of the Company and the nature of its business.

(vii) According to the information and explanations given to us, in respect of statutory dues:

(a) The Company has been regular in depositing undisputed statutory dues, including Provident Fund, Investor Education and Protection Fund, Income-tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues applicable to it with the appropriate authorities. As explained to us, the provisions of Employees State Insurance Act, 1948 is not applicable to the Company for the year ended 31st March, 2014.

(b) There were no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Income-tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory dues in arrears as at 31st March, 2014 for a period of more than six months from the date they became payable.

(c) Details of dues of Income-tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty Excise Duty and Cess which have not been deposited as on 31st March, 2014 on account of disputes are given below:

20th ANNUAL REPORT 2013 - 14 65 Forum where Period to Amount Nature of which the Statute Dispute involved Dues amount is pending (` in crore) relates

Income Tax Act, 1961 Income Tax Commissioner of Income 2006-07 0.03 Tax (Appeals)

Income Tax Apellate 2008-09 0.11 Tribunal

Central Sales Sales Tax Deputy Commissioner 1997-98 0.03 Tax, 1956 of Sales Tax (Appeals)

Deputy Commissioner of 1998-99 0.45 Sales Tax (Appeals)

Deputy Commissioner of 2003-04 0.003 Sales Tax (Appeals)

Joint Commissioner of 2004-05 21.03 Sales Tax (Appeals)

Deputy Commissioner of 2006-07 0.02 Sales Tax (Appeals)

Finance Act, 1994 Service Tax Commissioner (Appeals) 2003-06 0.83 (Service Tax Provisions) Commissioner (Appeals) 2004-06 0.34

Commissioner (Appeals) 2006-08 4.50

Commissioner (Appeals) 2008-09 3.00

(viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to financial institutions and banks. The Company has not issued any debentures.

(ix) In our opinion and according to the information and explanations given to us, the terms and conditions of the guarantees given by the Company for loans taken by others from banks and financial institutions are not prima facie prejudicial to the interests of the Company.

(x) In our opinion and according to the information and explanations given to us, the term loans have been applied by the Company during the year for the purposes for which they were obtained.

(xi) In our opinion and according to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that funds raised on short-term basis have, prima facie, not been used during the year for long- term investment.

(xii) According to the information and explanations given to us, the Company has not made preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Companies Act, 1956.

(xiii) To the best of our knowledge and according to the information and explanations given to us, no material fraud by the Company and no material fraud on the Company has been noticed or reported during the year.

Sunil S Kothari For Deloitte Haskins & Sells LLP Partner Chartered Accountants (Membership No. 208238) (Firm Registration No. 117366W/W-100018)

Date: May 15, 2014 Place: Pune

66 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Balance Sheet as at March 31, 2014

(Amount in ` Crore) Particulars Note No. March 31, 2014 March 31, 2013

I. EQUITY AND LIABILITIES (1) Shareholders' Funds (a) Share capital 3 43.02 43.02 (b) Reserves and surplus 4 716.47 665.29 759.49 708.31 (2) Non-current Liabilities (a) Long-term borrowings 5 0.05 0.17 (b) Deferred tax liabilities (Net) 6 3.44 4.56 (c) Trade payables 0.45 0.36 (d) Long-term provisions 7 16.43 8.55 20.37 13.64 (3) Current Liabilities (a) Short-term borrowings from banks (Unsecured) 89.84 54.28 (b) Trade payables (Refer Note 25 (iv)) 129.47 126.46 (c) Other current liabilities 8 8.89 10.00 (d) Short-term provisions 9 92.10 81.14 (e) Income tax liabilities (Net) 0.28 0.28 320.58 272.16

1100.44 994.11 II. ASSETS (1) Non-current Assets (a) Fixed assets (i) Tangible assets 10 74.08 59.85 (ii) Intangible assets 11 39.39 36.12 (iii) Capital work-in-progress 0.49 13.67 (iv) Intangible assets under development 1.88 3.29 115.84 112.93 (b) Non-current investments 12 233.98 246.48 (c) Long-term loans and advances 13 8.19 6.36 (d) Income tax assets (Net) 26.09 13.34 384.10 379.11 (2) Current Assets (a) Current investments 14 492.90 262.46 (b) Trade receivables 15 114.92 124.59 (c) Cash and bank balances 16 88.90 19.07 (d) Other current assets 17 8.46 12.04 (e) Short-term loans and advances 18 11.16 196.84 716.34 615.00

1100.44 994.11 Significant Accounting Policies 2 Accompanying Notes to the Financial Statements 25

For and on behalf of the Board

In terms of our report attached S Ramadorai P R McGoldrick For Deloitte Haskins & Sells LLP Chairman Managing Director Chartered Accountants R Gopalakrishnan Samrat Gupta Director Chief Financial Officer Sunil S Kothari P P Kadle Anubhav Kapoor Partner Director Company Secretary Date: May 15, 2014 C Ramakrishnan Place: Pune Director Date: May 15, 2014 Place: Mumbai

20th ANNUAL REPORT 2013 - 14 67 Statement of Profit and Loss for the year ended March 31, 2014

(Amount in ` Crore) Year ended Year ended Particulars Note No. March 31, 2014 March 31, 2013

I. Revenue from operations 19 886.18 774.70 II. Other income 20 43.16 43.33 III. Total revenue (I + II) 929.34 818.03 IV. Expenses : (a) Cost of traded products 98.23 83.02 (b) Consultancy fees, softwares and others 21 60.80 40.68 (c) Employee benefit expense 22 399.61 345.18 (d) Finance cost 23 1.43 1.62 (e) Depreciation and amortisation expense 10 & 11 36.15 27.02 (f) Other expenses 24 73.82 58.47 Total expenses 670.04 555.99

V. Profit before tax (III - IV) 259.30 262.04

VI. Tax expense : (a) Current tax 57.70 60.01 (b) Deferred tax (1.12) 0.81 56.58 60.82

VII. Profit after tax (V- VI) 202.72 201.22

VIII. Earnings Per Equity Share : [Refer Note 25(i)] (a) Basic 47.12 46.77 (b) Diluted 47.10 46.76

Significant Accounting Policies 2 Accompanying Notes to the Financial Statements 25

For and on behalf of the Board

In terms of our report attached S Ramadorai P R McGoldrick For Deloitte Haskins & Sells LLP Chairman Managing Director Chartered Accountants R Gopalakrishnan Samrat Gupta Director Chief Financial Officer Sunil S Kothari P P Kadle Anubhav Kapoor Partner Director Company Secretary Date: May 15, 2014 C Ramakrishnan Place: Pune Director Date: May 15, 2014 Place: Mumbai

68 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Cash Flow Statement

(Amount in ` Crore) Year ended Year ended Cash Flow Statement for the March 31, 2014 March 31, 2013 CASH FLOW FROM OPERATING ACTIVITIES Net profit after taxation 202.72 201.22 Depreciation and amortization 36.14 27.02 Disallowance of TDS abroad 0.28 0.30 Provision for wealth taxes 0.01 0.01 Provision for income tax 57.70 60.01 Provision for deferred tax (1.12) 0.81 Dividend income on investments (13.85) (14.34) (Profit)/Loss on sale of investment (4.74) (3.92) (Profit)/Loss on sale of tangible and intangible fixed assets 0.22 - Interest income (12.50) (8.04) Finance costs 1.43 1.62 Unrealised exchange loss / (gain) (1.29) (0.19) Effect of exchange differences on translation of foreign currency cash & cash equivalent 0.55 0.51 Allowances for doubtful debts (1.64) 0.79 Operating profit before working capital changes 263.91 265.80 Adjustments: Trade receivables 11.44 (35.92) Other current assets 3.58 35.32 Short term loans and advances 1.78 (4.84) Long term loans and advances 1.41 (0.15) Trade payables 6.73 28.99 Other current liabilities (0.44) (2.39) Income received in advance (0.53) 1.17 Short term provision 0.37 (0.19) Long term provision 7.87 1.47 CASH GENERATED FROM OPERATIONS 296.12 289.26

Income taxes paid (net) (70.74) (57.58)

NET CASH FLOW (USED IN) / GENERATED FROM OPERATING ACTIVITIES 225.38 231.68 CASH FLOW FROM INVESTING ACTIVITIES Dividend received 1.48 2.83 Income from sale of investment 4.74 3.92 Interest received on bank deposit and others 0.03 2.84 Investment in preference shares - (5.00) Investment in joint ventures - (0.75) Inter corporate deposits placed (926.60) (817.65) Inter corporate deposits refunded 1110.50 663.75 Loans to others (2.97) 0.12 Deposits with financial companies - 10.00 Interest received from intercorporate deposit / bonds 12.47 6.62 Purchase of mutual fund (1758.02) (1,974.71) Sale of mutual funds 1552.43 1,896.34 Fixed deposit with banks (net) having maturity over three months (0.26) 0.34 Proceeds from sale of tangible and intangible fixed assets 0.11 0.07 Payment for purchase of tangible and intangible fixed assets (43.23) (34.93) NET CASH FLOW (USED IN)/GENERATED FROM INVESTING ACTIVITIES (49.32) (246.21) CASH FLOW FROM FINANCING ACTIVITIES Proceeds from issue of shares including premium - 0.54 Interest paid (1.46) (1.58) Dividends paid (including dividend tax) (140.70) (79.19) Proceeds from short term borrowings 217.75 112.90 Repayment of short term borrowings (181.05) (112.67) Repayment of long term borrowings (0.47) (0.50) NET CASH FLOW (USED IN)/GENERATED FROM FINANCING ACTIVITIES (105.93) (80.50)

NET INCREASE / (DECREASE) IN CASH & CASH EQUIVALENTS 70.13 (95.03)

Cash & bank balances at the close of the year (Refer Note 16) # 88.90 19.07 Less: bank deposits with original maturity over three months for the year 0.30 0.05 Cash & bank balances at the beginning of the year (Refer Note 16) 19.07 114.95 Less: bank deposits with original maturity over three months for the previous year 0.05 0.39 Effect of exchange rate changes on cash and cash equivalents 0.55 0.51 70.13 (95.03) # Cash & Bank Balances Comprises : a) Cash and cash equivalents Cash on hand 0.02 0.02 Cheques, drafts on hand 35.15 1.44 Current account with banks 50.14 16.74 Pledged/lien with banks - 0.02 Bank deposits less than 3 months maturity 2.25 - b) Other bank balances (with more than 3 months but less than 12 months maturity) Earmarked balance with banks 1.04 0.80 Pledged/lien with banks 0.27 0.04 c) Other bank balances (with more than 12 months maturity) Pledged/lien with banks 0.03 0.01 88.90 19.07

For and on behalf of the Board In terms of our report attached S Ramadorai P R McGoldrick For Deloitte Haskins & Sells LLP Chairman Managing Director Chartered Accountants R Gopalakrishnan Samrat Gupta Director Chief Financial Officer Sunil S Kothari P P Kadle Anubhav Kapoor Partner Director Company Secretary Date: May 15, 2014 C Ramakrishnan Place: Pune Director Date: May 15, 2014 Place: Mumbai 20th ANNUAL REPORT 2013 - 14 69 Notes forming part of Financial Statements

Note 1

Company Overview

TATA Technologies Limited ("TTL or the Company") was incorporated on August 22, 1994 as a Private Limited company in the name of Core Software Systems Private Limited. The name of the Company was subsequently changed to Tata Technologies (India) Limited. On February 8, 2001, the Company changed its name from Tata Technologies (India) Limited to Tata Technologies Limited. The Company's range of services includes IT Consultancy, SAP implementation and maintenance, providing networking solutions, CAD/CAM engineering & design consultancy. The Company is headquartered in Pune, India. The Company has five branches located at Mumbai, Lucknow, Jamshedpur, Bangalore and Chennai that enables it to provide high quality, cost-effective services to clients in India.

Note 2

Significant Accounting Policies

a. Basis of Preparation of Financial Statements

The financial statements are prepared under the historical cost convention, in accordance with Indian Generally Accepted Accounting Principles (GAAP). GAAP comprises the mandatory accounting standards notified under the Companies (Accounting Standards) Rules, 2006. Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.

b. Use of Estimates

The preparation of the financial statements in conformity with GAAP requires the management of the Company (Management) to make estimates and assumptions that affect the reported amounts of revenue and expenses during the period / year and balances of assets and liabilities and disclosures relating to contingent liabilities as at the date of financial statements. Provisions are made for all known losses and liabilities, future unforeseeable factors that may affect the profit on fixed price service contracts and also towards likely expenses for providing post-sales client support on such contracts.

c. Revenue Recognition

Revenue from services on time and materials contracts is recognized when services are rendered and related costs are incurred i.e. based on certification of time sheets and billed to clients as per the terms of specific contracts. In case of fixed price contracts, revenue is recognized over the life of the contract based on milestones achieved as specified in the contracts or by proportionate completion method on the basis of the work completed. Foreseeable losses on such contracts are recognized when probable.

Revenue from rendering Annual Maintenance Services (SAP-ERP) is recognized proportionately over the period of contract. Revenue from third party software products and hardware sale is recognized upon delivery. Cost and earnings in excess of billings are classified as unbilled revenue while billings in excess of cost and earnings is classified as unearned revenue.

Income from interest and rent is recognized on time proportion basis. Dividend from investments is recognized when the right to receive the payment is established and when no significant uncertainty as to measurability or collectability exists. Commission Income on sale of PLM products is recognized upon delivery of products by the vendor to the end user.

d. Fixed Assets

Tangible assets are stated at cost, less accumulated depreciation. Costs include all expenses incurred to bring the assets to its present location and condition. Direct costs are capitalized till the assets are ready for use and include financing costs relating to any borrowing attributable to the acquisition of qualifying fixed assets. Capital work in progress and Intangible assets in progress comprises the cost of fixed assets that are not yet ready for their intended use at the reporting date. Intangible assets are recorded at the consideration paid for acquisition of such assets and are carried at cost less accumulated amortization and impairment.

Software not exceeding ` 25,000 is charged off to the Statement of Profit and Loss.

70 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION e. Depreciation/Amortisation

Depreciation on Fixed Assets is provided on Straight Line Method (SLM) at the rates specified in the schedule XIV to the Companies Act, 1956, except as follows:

Type of Asset Depreciation Percentage

Leasehold Land Lease Period Leasehold Improvements Lease Period Buildings 4% to 6.67% Plant and Machinery 4.75% to 20% Computer Equipments 25% to 50% Vehicles 9.5% to 33.33% Software Licenses License Period 25% to 50%

Depreciation/Amortisation on additions to Fixed Assets is provided from the month of acquisition of the Asset. Depreciation/Amortisation on Assets sold / scraped during the period is provided for prior to the month of sale / scrap as the case may be.

The Company charges 100% depreciation/amortisation on assets individually costing less than ` 5000 in the year of purchase. f. Leases

Assets leased by the Company in its capacity as lessee, where the Company has substantially all the risks and rewards of ownership are classified as finance lease. Such lease are capitalised at the inception of the lease at lower of the fair value or the present value of the minimum lease payments and a liability is created for an equivalent amount. Each lease rental paid is allocated between the liability and the interest cost so as to obtain a constant periodic rate of interest on the outstanding liability for each year.

Lease arrangements where the risks and rewards incidental to ownership of an asset substantially vest with the lessor, are recognized as operating lease. Lease payments under operating leases are recognized in the Statement of Profit & Loss on a straight line basis. g. Foreign Currency transactions

Income and expenses in foreign currencies are recorded at the exchange rates prevailing on the date of the transaction.

Monetary current assets and current liabilities are reinstated at year-end exchange rates and the profit / loss so determined and also the realized exchange gains / losses are recognized in the Statement of Profit & Loss.

Premium or discount on forward contracts is amortized over the life of such contract and is recognized as income or expense in the Statement of Profit & Loss. h. Investments

Trade investments are the investments made to enhance the Group's business interests.

Investments are classified into current investments & long term investments.

Current investments are carried at lower of cost and market value. Any reduction in carrying amount and reversals of such reductions are charged or credited to the Statement of Profit & Loss.

Long term investments are stated at cost less provision for diminution in the value of such investments. Diminution in value is provided for where the management is of the opinion that the diminution is other than temporary in nature.

Cost of overseas investments comprises the Indian rupee value of the consideration paid for the investment translated at the exchange rate prevalent at the date of investment. i. Impairment of Assets

At each balance sheet date, the Company reviews using internal resources the carrying amounts of its

20th ANNUAL REPORT 2013 - 14 71 fixed assets to determine whether there is any indication that the assets suffered an impairment loss. If any such condition exists, the recoverable amount of the asset is estimated in order to determine the extent of impairment loss. Recoverable amount is the higher of an asset's net selling price and value in use. In assessing value in use, the estimated future cash flows expected from continuing use of the asset and from its disposal are discounted to their present value using a pre tax rate that reflects the current market assessments of time value of money and the risks specific to the asset.

Reversal of impairment loss is recognized immediately as income in the Statement of Profit & Loss.

j. Inventories

Inventories comprising of traded software products are valued at lower of cost or net realizable value.

k. Employee Benefits i. Gratuity The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees. The plan provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to 15 to 30 days salary payable for each completed year of service. Vesting occurs upon completion of five years of service. The Company makes annual contributions to gratuity fund established as trust. The Company accounts for the liability for gratuity benefits payable in future based on an independent actuarial valuation as on the Balance Sheet date.

ii. Superannuation The Company has two superannuation plans, a defined benefit plan and a defined contribution plan. An eligible employee on April 1, 1996 could elect to be member of either plan.

Employees who are the members of the defined benefit superannuation plan are entitled to benefits depending on the years of service and salary drawn. The monthly pension benefits after retirement range from 0.75% to 2% of the annual basic salary for each year of service. The Company account for superannuation benefits payable in future under the plan based on an independent actuarial valuation as on the Balance Sheet date.

With effect from April 1, 2003, this plan was amended and benefits earned by covered employees have been protected as at March 31, 2003. Employees covered by this plan are prospectively entitled to benefits computed on a basis that ensures that the annual cost of providing the pension benefits would not exceed 15% of salary.

The Company maintains separate irrevocable trusts for employees covered and entitled to benefits. The Company contributes up to 15% of the eligible employees' salary to the trust every year. Such contributions are recognized as an expense when incurred. The Company has no further obligation beyond this contribution.

iii. Bhavishya Kalyan Yojana (BKY) Bhavishya Kalyan Yojana is an unfunded defined benefit plan. The benefits of the plan accrue to an eligible employee at the time of death or permanent disablement, while in service, either as a result of an injury or as certified by the appropriate authority. The monthly payment to dependents of the deceased /disabled employee under the plan equals 50% of the salary drawn at the time of death or accident or a specified amount, whichever is higher. The Company accounts for the liability for BKY benefits payable in future based on an independent actuarial valuation as on the Balance Sheet date.

iv. Post-retirement Medicare Scheme Under this Scheme employees get medical benefits subject to certain limits of amount, periods after retirement and types of benefits, depending on their grade and location at the time of retirement. The Company account for the liability for post-retirement medical scheme based on an independent actuarial valuation as on the Balance Sheet date.

v. Provident Fund The eligible employees of the Company are entitled to receive benefits under the provident fund, a defined contribution plan, in which both employees and the company make monthly contributions at a specified percentage of the covered employees' salary (currently 12% of employees' salary). The provident fund contributions, as specified under the law, are paid to the provident fund set up as irrevocable trust by the Company and pension amount is paid to Regional Provident Fund Commissioner and the Central Provident Fund under the State Pension Scheme. The contributions paid during the year are charged to Statement of Profit and Loss.

72 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION vi. Compensated absences The Company provides for the encashment of leave or leave with pay subject to certain rules. The employees are entitled to accumulate leave subject to certain limits, for future encashment. The liability is provided based on number of days of unutilized leave at each balance sheet date based on an independent actuarial valuation as on the Balance Sheet date. l. Taxation

Current income tax expense comprises taxes on income from operations in India. Current Income tax payable in India is determined in accordance with the provisions of Income Tax Act, 1961.

Deferred tax expense or benefit is recognized on timing differences being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets and liabilities are measured using the tax rates and the tax laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax assets in respect of unabsorbed depreciation and carry forward of losses are recognized only to the extent that there is virtual certainty that taxable income will be available to realize these assets. All other deferred tax assets are recognized only to the extent that there is reasonable certainty that future taxable income will be available to realize such assets. m. Employee Stock Options

In accordance with the Employee Stock Option Scheme and Employee Stock Purchase Scheme Guidelines, 1999 issued by Securities and Exchange Board of India (SEBI), the Company introduced Employee Stock Option Plan 2001 (TTESOP 2001) in 2000-01. As per the Plan, the options were granted at fair value as determined by an independent valuer as on the date of the grant and hence no compensation cost has been recognized. n. Cash flow statement

Cash flows are reported using indirect method, whereby net profits after tax is adjusted for the effects of transactions of a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the Company are segregated. o. Cash and Cash Equivalent

The Company considers all highly liquid financial instruments, which are readily convertible into cash and have original maturities of three months or less from the date of purchase, to be cash equivalents. p. Earnings per share

The earnings considered in ascertaining the Company's earnings per share comprise the net profit after tax and include the post-tax effect of any extra-ordinary items. The number of shares used in computing basic earnings per share, is the weighted average number of shares outstanding during the period. The number of shares used in computing diluted earnings per share comprises the shares considered for deriving basic earnings per share and also number of equity shares that could have been issued on the conversion of all dilutive potential equity shares. q. Borrowing costs

Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalized as part of the cost of that asset. Borrowing costs are capitalized as part of the cost of a qualifying asset when it is probable that they will result in future economic benefits to the enterprise and the costs can be measured reliably. Other borrowing costs are recognized as an expense in the period in which they are incurred. r. Provisions, contingent liabilities and contingent assets

A provision is recognized when the Company has a present obligation as a result of past event and its probable that an outflow of resources will be required to settle the obligation, in respect of which reliable estimate can be made. The provisions (excluding retirement benefits) are not discounted to its present value and are determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect current best estimates. Contingent liabilities are not recognized in the financial statements. A contingent asset is neither

20th ANNUAL REPORT 2013 - 14 73 recognized nor disclosed in the financial statements.

s. Change in segment reporting

During the year, considering the evolution of the operations over the period based on offshore/onshore model, the management of the Company has changed the primary segment from 'geographic' segment until last year to 'business' segment in the current year. The change reflects the way management reviews and plans its business operations and allocates the resources. The segments have been identified taking into account the organization structure, as well as risk and returns associated.

Note 3 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

SHARE CAPITAL

Authorised :

60,000,000 equity shares of ` 10/- each 60.00 60.00 (P.Y. 60,000,000 equity shares of ` 10/- each)

700,000 0.01% Cumulative Non-participative Compulsorily convertible Preference Shares of ` 10/- each 0.70 0.70 (P.Y. 700,000 0.01% Cumulative Non-participative Compulsorily convertible Preference Shares of ` 10/- each) 60.70 60.70 Issued, subscribed and fully paid :

43,024,138 equity shares of ` 10/- each (P.Y. 43,023,538 equity shares of ` 10/- each) 43.02 43.02

43.02 43.02

Note 3(i) Reconciliation of number of shares and amount outstanding at the beginning and at the end of the reporting periods : As at March 31, 2014 As at March 31, 2013 Particulars Amount in Amount in No. of Shares No. of Shares ` crore ` crore Equity shares

Number of shares as at April 1, 2013 43,023,538 43.02 42,970,138 42.97 Add: Shares issued under ESOP scheme 600 0.00 53,400 0.05

Number of shares as at March 31, 2014 43,024,138 43.02 43,023,538 43.02

Note 3(ii) Shares in the Company held by each shareholder holding more than 5 percent shares

As at March 31, 2014 As at March 31, 2013 Particulars % % No. of SharesHolding No. of Shares Holding Equity Shares

(a) Tata Motors Limited (Parent Company) 30,300,600 70.43 30,300,600 70.43 (b) Alpha TC Holdings Pte Ltd. 3,746,505 8.71 3,746,505 8.71 34,047,105 79.14 34,047,105 79.14

74 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Notes forming part of Financial Statements

Note 3(iii) Equity shares of ` 10/- each allocated towards employee stock options granted/available for grant as at March 31, 2014 - 60,671 shares (61,271 shares as at March 31, 2013).

Note 3(iv)

As at As at Number of options granted, exercised and forfeited March 31, 2014 March 31, 2013

Options granted, beginning of the year 14,651 68,951 Exercised during the year (600) (53,400) Forfeited during the year - (900) Option granted, end of the year 14,051 14,651

Note 4

RESERVES AND SURPLUS (Amount in ` Crore)

As at As at Particulars March 31, Additions Deductions March 31, 2013 2014

(a) Securities Premium Account

i) Securities Premium Account (Note 4 (i) & (iii)) 350.50 - - 350.50

ii) Securities Premium identified seperately for consolidation adjustment (Note 4 (i) & (iii)) 23.16 - - 23.16

(b) General Reserve 69.65 21.00 - 90.65

(c) Surplus i.e. balance in statement of Profit and Loss (Note 4 (iii)) 221.98 202.72 172.54 252.16

665.29 223.72 172.54 716.47

Note 4(i) Changes in Securities Premium Account (Amount in ` Crore)

2013-14 2012-13 Particulars Additions Deductions Additions Deductions

(a) Additions during the year - - 0.46 - (b) Capital Reduction adjustments during the year (Refer Note 4 (iii)) - - 0.02 -

--0.48 -

20th ANNUAL REPORT 2013 - 14 75 Notes forming part of Financial Statements

Note 4(ii) Changes in Statement of Profit and Loss : (Amount in ` Crore)

2013-14 2012-13 Particulars Additions Deductions Additions Deductions

(a) Profit for the year 202.72 - 201.22 - (b) Final dividend - 77.44 - 68.84 (c) Interim dividend - 51.64 - 38.69 (d) Tax on final dividend - 13.69 - 11.17 (e) Tax on Interim dividend - 8.77 - 6.28 (f) General reserve - 21.00 - 21.00 202.72 172.54 201.22 145.98

Note 4(iii)

During 2010, based on the approval of Shareholders of the Company at the Extra-Ordinary General Meeting held on March 5, 2010 and the Order of the Honourable High Court of Judicature at Mumbai dated April 16, 2010, the Company had utilized balance in the Securities Premium Account to the tune of ` 46.66 Crore towards one time charges/cost (including change in accounting policy for provision for doubtful debts) incurred by the Company and its subsidiary companies. The amounts relating to the Company amounting to ` 17.32 Crore had been adjusted to the Securities Premium Account. An amount of ` 29.34 Crore equivalent to the total amount of adjustments relating to the subsidiaries had been identified and segregated from the balance in the Securities Premium Account for adjustment on consolidation. Of this total adjustment made, ` 1.58 Crore and ` 16.58 Crore related to provision for doubtful debts of the Company and its subsidiary companies respectively on account of change in accounting with regard to provision for doubtful debts.

During the year ended March 31, 2014, the Company and its subsidiary companies have received amounts aggregating to ` Nil (` 0.02 Crore for the year ended March 31, 2013) against the balances adjusted in the Securities Premium Account as above. Consequently, such excess provisions for doubtful debts on account of the said collections have been written back to the Securities Premium Account.

Since realisation of doubtful debts provided for the adjustments above upto March 31, 2014 amounted to ` 6.18 Crore (` 6.18 Crore as on March 31, 2013) relating to the subsidiaries, accordingly, balance amount of ` 23.16 Crore relating to the subsidiaries is continued to be disclosed seperately as Securities Premium Account for adjustment on consolidation.

76 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Notes forming part of Financial Statements

Note 5 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013 LONG TERM BORROWINGS

Secured a) Banks Vehicle loans [Secured by hypothecation of vehicles] ## - 0.04

b) Others Long term maturity of finance lease obligations # (Refer Note 5 (i)) 0.05 0.13 (Secured against fixed assets obtained under finance lease arrangements)

0.05 0.17

Notes: # Terms of repayment - Equated Quarterly Installment ## Terms of repayment - Equated Monthly Installment

Note 5(i) Long term maturity of finance lease obligations

(Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

Total of Minimum lease payments Not later than one year 0.10 0.10 Later than one year and not later than five years 0.05 0.14 0.15 0.24

Less: Interest 0.01 0.03 0.14 0.21

Present Value of Minimum lease payments Not later than one year 0.09 0.08 Later than one year and not later than five years 0.05 0.13 0.14 0.21 The company has entered into finance lease arrangements for servers.

20th ANNUAL REPORT 2013 - 14 77 Notes forming part of Financial Statements

Note 6 (Amount in `Crore)

As at As at Particulars March 31, 2014 March 31, 2013

DEFERRED TAX LIABILITIES (NET)

Tax effect of items constituting deferred tax liabilities : On difference between book balance and tax balance of fixed assets 8.99 9.64 Sub-total 8.99 9.64 Deferred tax assets: Provision for expenses disallowed under section 43B of The Income Tax Act,1961 4.37 3.52 Provision for doubtful debts 0.76 0.71 Others 0.42 0.85 Sub-total 5.55 5.08 Deferred tax liabilities (net) 3.44 4.56

Note 7 (Amount in `Crore) As at As at Particulars March 31, 2014 March 31, 2013

LONG - TERM PROVISIONS

Provision for employee benefits (Refer Note 7(i) & 7(ii)) 16.43 8.55 16.43 8.55

78 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Notes forming part of Financial Statements 0.06 Crore) ` (Amount in BKY .31 0.24 0.16 0.09 0.10 0.12 0.14 0.12 0.09 0.06 0.12 0.14 0.12 0.09 0.06 0.06 .08 0.04 0.06 0.06 0.07 0.06 0.06 0.09 0.04 0.06 0.06 0.07 0.07 0.05 ------8 0.19 0.17 0.31 0.24 0.16 0.09 0.10 8 0.05 0.66 0.47 0.28 0.46 0.43 0.08 A N/A N/A N/A N/A N/A N/A N/A 0.17) (0.31) 0.37 0.02 (0.08) 0.21 0.28 (0.08) ------0.11 0.09 0.04 0.06 0.06 0.07 0.07 0.05 ------7) (0.12) (0.08) (0.04) (0.06) (0.06) (0.07) (0.06) (0.06) 7) (0.11) (0.09) (0.04) (0.06) (0.06) (0.07) (0.07) (0.05) 67 (0.17) (0.31) 0.37 0.02 (0.08) 0.21 0.28 (0.08) N/A N/A N/A N/A N/A N/A N/A N/A N/A ------One percentage point increase in Medical rate inflation One percentage point decrease in Medical rate inflation N/A 0.02 0.08 0.21 0.17 N/A (0.01) 0.07 0.18 0.16 N/A 0.03 0.16 0.18 0.13 N/A (0.03) 0.16 0.16 0.11 0.34 0.44 2.02 0.30 2.17 (0.30) (0.36) 1.93 0.28 1.93 2014 2013 2011 2010 2012 2014 2013 2010 2012 2011 0.82 4.21 3.60 2.74 1.97 2.01 2.04 2.13 1.72 1.50 1.11 0.74 1 4.93 2.74 1.97 2.01 2.04 1.42 1.72 1.50 1.11 0.74 0.72 4.14 4.21 3.61 2.74 1.97 2.01 2.04 2.13 1.72 1.50 1.11 0.74 (0.99) 0.13 0.19 (0.28) 0.17 (0.27) 0.26 0.06 0.01 (0.22) (0.30) 0.07 (4.92) (4.14) (4.21) (3.61) (2.74) (1.97) (2.01) (2.04) (2.13) (1.72) (1.50) (1.11) (0.74) 1.20 0.88 0.60 0.64 Compensated absencesCompensated Medicare scheme Post-retirement nd on the independent actuarial valuation at the year end. the year at nd on the independent actuarial valuation Gratuity Superannuation

20142012 2011 2013 2010 2014 2010 2013 2011 2010 2012 2011 2012 2013 2012 2010 2013 2014 2013 2011 2014 2010 2014 2012 2011 sheet Employer ServiceEmployer cost 2.71 2.30 2.25 1.34 1.16 0.25 0.25 0.24 0.20 0.26 1.52 0.69 0.11 0.08 0.19 0.17 0 Interest costInterest 1.77 1.52 1.16 0.92 0.89 0.39 0.37 0.35 0.33 0.33 0.36 0.35 0.29 0.28 0.35 0.22 0.16 0.17 0.17 Expected return on plan assetsExpected return (1.75) (1.66) (1.25) (0.88) (0.94) (0.49) (0.41) (0.41) (0.41) (0.39) ------Actuarial Losses/(Gains) 3.42 0.34 2.84 1.71 (0.02) 0.07 ( 0.78) 0.51 0.35 (0.16) 0.93 0.36 1.05 0.94 (0.17) 0.10 0.67 ( Total expense / (income) recognised in the expense Total Statement of Profit & Loss 6.15 2.50 5.00 3.09 1.09 0.22 (0.57) 0.69 0.47 0.04 2.81 1.91 2.22 1.82 1.01 0.94 0.0 Actual benefit payments 1.35 1.16 1.39 2.52 1.13 0.14 0.19 - 0.82 0.01 1.84 1.60 1.42 1.89 1.54 0.15 0.17 0.12 0 Actual Contributions (1.05) 1.77 9.91 - - 0.24 0.25 0.24 0.20 0.28 1.84 1.60 1.42 1.87 1.55 0.15 0.17 0.11 Present Value of Defined Benefit ObligationValue Present 27.94 21.89 18.44 14.37 12.12 6.40 5.85 5.61 5.17 5.32 6.19 5.22 4.92 Fair value of plan assets value Fair 21.94 23.11 20.38 11.40 12.24 6.67 6.11 5.05 5.06 5.47 ------Net asset/(liability) recognised in balance sheetNet asset/(liability) recognised (6.00) 1.22 1.94 (2.97) 0.12 0.27 0.26 (0.56) (0.11) 0.15 (6.19) (5.22) Experience adjustment on plan liabilities 1.58 (1.02) (2.54) (2.79) (2.44) 0.05 0.07 0.15 (0.15) 0.12 (0.80) (0.36) (1.12) Experience adjustment on plan assets 0.51 0.46 (0.78) 0.80 0.16 0.03 0.59 (0.67) (1.05) 0.04 ------Present Value of DBO at beginning of year of DBO at Value Present 21.89 18.44 14.37 12.12 11.06 5.85 5.61 5.17 5.31 4.87 5.23 4.92 4.14 4.2 Employer ServiceEmployer cost 2.71 2.30 2.25 1.34 1.16 0.25 0.25 0.24 0.20 0.26 1.52 1.20 0.88 0.60 0.64 0.69 0.11 0.0 Interest cost Interest 1.77 1.52 1.16 0.92 0.89 0.39 0.37 0.35 0.33 0.33 0.36 0.35 0.29 0.28 0.35 0.22 0.16 0.17 0.17 Actuarial (gains)/ losses 2.92 0.79 2.05 2.51 0.14 0.05 (0.19) (0.15) 0.15 (0.12) 0.93 0.36 1.03 0.94 (0.17) 0.10 0. Benefits paid (1.35) (1.16) (1.39) (2.52) (1.13) (0.14) (0.19) - (0.82) (0.01) (1.84) (1.60) (1.42) (1.89) (1.54) (0.15) (0.1 Present Value of DBO at the end of year of DBO at Value Present 27.94 21.89 18.44 14.37 12.12 6.40 5.85 5.61 5.17 5.32 6.20 5.23 4.92 4.14 Plan assets at beginning of yearPlan assets at 23.11 20.39 11.39 12.24 12.27 6.11 5.05 5.06 5.47 4.77 N/A N/A N/A N/A N/A N/A Actual return on plan assetsActual return 1.23 2.11 0.47 1.68 1.10 0.46 1.00 (0.25) 0.21 0.43 N/A N/A N/A N/A N/A N/A N/A N/ Actual Company contributionsActual Company (1.05) 1.77 9.91 - - 0.24 0.25 0.24 0.20 0.28 1.84 1.60 1.42 1.87 1.55 0.15 0.17 Benefits paid (1.35) (1.16) (1.39) (2.52) (1.13) (0.14) (0.19) - (0.82) (0.01) (1.84) (1.60) (1.42) (1.87) (1.55) (0.15) (0.1 Plan assets at the end of yearPlan assets at 21.94 23.11 20.38 11.40 12.24 6.67 6.11 5.05 5.06 5.47 ------Discount Rate 9.20% 8% 9% 9% 9% 6.75% 7% 7% 7% 7% 9.20% 8% 9% 9% 9% 9.20% 8% 9% 9% 9% 9.20% 8% 9% 9% 9% Expected Return on plan assets 8% 8% 8% 8% 8% 8% 8% 8% 8% 8% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Salary escalation 5-6.2% 4% 5% 2-5% 2-5% N/A N/A N/A N/A N/A 5-6.2% 4% 5% 2-5% 2-5% N/A N/A N/A N/A N/A 5-6.2% 4% 5% 2-5% 2-5% Medical cost inflation N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 6% 5% 4% 4% 4% N/A N/A N/A N/A N/A percentage of total plan assets Debt securities 98% 99% 74% 100% 100% 100% 100% 100% 100% 99% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Balances with banks 2% 1% 26% 0% 0% 0% 0% 0% 0% 1% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A assumed Medical rate inflation DBO as at 31 March DBO as at Service cost for the year Interest cost for the year Interest Note 7(i) : as on March 31, 2014 absences – as per actuarial valuations Defined benefits plans / long term compensated i expense Components of employer ii Actual Contribution and Benefit Payments iii Net asset/(liability) recognised in balance iv Change in Defined Benefit Obligations (DBO) v of Assets Value Change in Fair vi Actuarial Assumptions vii The major categories of plan assets as viii Effect of one percentage point change in The Company accounts for the liability for employee benefits payable in future based on an estimated basis for the period end a based on an estimated in future benefits payable for employee accounts for the liability Company The

20th ANNUAL REPORT 2013 - 14 79 Notes forming part of Financial Statements

Note 7 (ii) : Defined Contribution Plans- The Company's contribution to defined contribution plan aggregated Rs. 17.07 crores (2012-13 ` 15.15 crores) for the year ended March 31, 2014 has been recognised in the statement of Profit and Loss. (a) The expected rate of return on plan assets is based on market expectation, at the beginning of the year, for returns over the entire life of the related obligation. (b) The assumption of future salary increases, considered in actuarial valuation, takes into account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market. (c) Also refer note 2(k) for brief description of employee benefit schemes.

Note 8 (Amount in ` Crore)

As at As at Particulars March 31, 2014 March 31, 2013

OTHER CURRENT LIABILITIES

(a) Interest accrued but not due on borrowings 0.04 0.07 (b) Current maturities of long-term debt (Refer Note 5) 0.02 0.37 (c) Current maturities of finance lease obligations (Refer Note 5(i)) 0.08 0.08 (d) Income received in advance 0.63 1.17 (e) Unclaimed / unpaid dividends 1.03 0.79 (f) Statutory remittances (withholding taxes, VAT, etc.) 5.82 5.90 (g) Advance and progress payments 1.27 1.62 8.89 10.00

Note 9 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013 SHORT-TERM PROVISIONS

(a) Provision for employee benefits (Refer Note 7(i) & 7(ii)) 1.50 1.13 (b) Provision for final dividend 77.44 68.84 (c) Provision for tax on dividend 13.16 11.17 92.10 81.14

80 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Notes forming part of financial statements Note 10

(Amount in ` Crore)

Accumulated Depreciation Accumulated Net Book Net Book Cost as at Cost as at depreciation for the year depreciation Value Value FIXED ASSETS Additions Deductions Deductions Apr 1, 2013 March 31, 2014 up to ended up to as at as at Apr 1, 2013 March 31, 2014 March 31, 2014 March 31, 2014 March 31, 2013

[A] TANGIBLE ASSETS

(a) Leasehold land 4.09 - - 4.09 0.53 0.04 - 0.57 3.52 3.56 (4.09) (-) (-) (4.09) (0.49) (0.04) (-) (0.53) (3.56) (3.60) (b) Buildings 22.79 0.04 - 22.83 7.56 0.95 - 8.51 14.32 15.23 (22.79) (-) (-) (22.79) (6.61) (0.95) (-) (7.56) (15.23) (16.18) (c) Plant & machinery and equipments - Owned 17.26 2.60 0.17 19.69 5.89 1.32 0.10 7.11 12.58 11.37 (16.37) (0.94) (0.05) (17.26) (4.89) (1.03) (0.03) (5.89) (11.37) (11.48) (d) Plant & machinery and equipments - Leased 0.43 - - 0.43 0.25 0.11 - 0.36 0.07 0.18 (0.43) (-) (-) (0.43) (0.14) (0.11) (-) (0.25) (0.18) (0.29) (e) Office equipments 3.20 0.97 0.25 3.92 0.88 0.21 0.11 0.98 2.94 2.32 (2.80) (0.45) (0.05) (3.20) (0.76) (0.15) (0.03) (0.88) (2.32) (2.04) (f) Computers 51.91 20.01 1.15 70.77 35.65 10.62 1.15 45.12 25.65 16.26 (50.27) (6.02) (4.38) (51.91) (33.44) (6.58) (4.37) (35.65) (16.26) (16.83) (g) Furniture and fixtures 8.15 1.59 - 9.74 3.20 0.61 - 3.81 5.93 4.95 (7.48) (0.83) (0.16) (8.15) (2.86) (0.48) (0.14) (3.20) (4.95) (4.62) (h) Vehicles (Refer Note 10 (i)) 2.82 0.69 1.43 2.08 1.67 0.77 1.32 1.12 0.96 1.15 (2.80) (0.17) (0.15) (2.82) (1.04) (0.78) (0.15) (1.67) (1.15) (1.76) 20th ANNUAL REPORT 2013- 14 (i) Leasehold Improvements 5.87 4.45 - 10.32 1.04 1.17 - 2.21 8.11 4.83 (4.55) (1.32) (-) (5.87) (0.34) (0.70) (-) (1.04) (4.83) (4.21)

Total 116.52 30.35 3.00 143.87 56.67 15.80 2.68 69.79 74.08 59.85

(111.58) (9.73) (4.79) (116.52) (50.57) (10.82) (4.72) (56.67) (59.85)

Notes : (i) Vehicles includes gross block as at March 31, 2014 ` 0.37 Crore (W.D.V. ` 0.03 Crore) acquired on loan, hypothecated with Tata Capital Ltd, Tata Finance Ltd, Tata Motors Finance Limited and ICICI Bank Ltd (as at March 31, 2013 ` 1.64 Crore) (W.D.V ` 0.47 Crore)) (ii) Capital Commitment : The estimated amount of contracts remaining to be executed on capital account, and not provided for is ` 11.75 Crore as at March 31, 2014 (as at March 31, 2013 : ` 9.49 Crore). 81 (iii) Previous year's figures are shown in the brackets 82 Notes forming part of Financial Statements BUSINESS TRANSFORMATION NAVIGATION THROUGH BETTER Note 11 (Amount in ` Crore)

Accumulated Amortisation Accumulated Net Book Net Book Cost as at Cost as at amortisation for the year amortisation Value Value FIXED ASSETS Additions Deductions Deductions Apr 1, 2013 March 31, 2014 up to ended up to as at as at Apr 1, 2013 March 31, 2014 March 31, 2014 March 31, 2014 March 31, 2013

[B] INTANGIBLE ASSETS (Other than internally generated)

(a) Software Licenses 84.80 23.62 2.33 106.09 48.68 20.35 2.33 66.70 39.39 36.12 (65.74) (19.06) (-) (84.80) (32.48) (16.20) (-) (48.68) (36.12) (33.26)

Total 84.80 23.62 2.33 106.09 48.68 20.35 2.33 66.70 39.39 36.12 (65.74) (19.06) (-) (84.80) (32.48) (16.20) (-) (48.68) (36.12)

Notes : (i) Capital Commitment : The estimated amount of contracts remaining to be executed on capital account, and not provided for is ` 2.51 Crore as at March 31, 2014 (as at March 31, 2013 : ` 8.59 Crore). (ii) Previous year's figures are shown in the brackets. Notes forming part of Financial Statements

Note 12 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013 NON-CURRENT INVESTMENTS Trade Investments Investments in Equity instruments (Unquoted at cost) i) Subsidiaries (a) Tata Technologies Inc. 15.57 15.57 (150,000 (P.Y. 150,000) shares of non-voting Class 'A' common stock with no Par value)

(b) Tata Technologies Pte Ltd, Singapore, a 100% subsidiary company 203.34 203.34 (86,463,759 (P.Y. 86,463,759) ordinary shares with no par value)

ii) Joint Ventures Tata HAL Technologies Ltd (formerly known as INCAT HAL Aerostructures Ltd) 5,070,000 (P.Y. 5,070,000) equity shares of ` 10 each fully paid (50% JV with HAL) 5.07 5.07

Other Investments (Quoted)* i) Investment in Debentures Tata Motors Finance Limited 5.00 5.00 100 (P.Y. 100) 11% Non Convertible Debentures of ` 0.05 Crore each fully paid

ii) Investments in Mutual Funds Tata FMP - Series 42 Scheme H - Direct - Growth - 2.00 BNP Paribas Fixed Term Fund Series - 24A - Direct - Growth - 3.00 DWS Fixed Maturity Plan - Series 26 - Direct - Growth - 2.50 JP Morgan Fixed Maturity Plan Sr. 16 - Direct Growth - 5.00 * (Note: Market value of quoted investments ` 5.18 Crore ( P.Y. ` 17.52 Crore)

Other Investments (Unquoted) i) Investment in Preference Shares Tata Capital Limited 33,333 (P.Y. 33,333) Cumulative redeemable non participating preference shares of ` 1,500 each fully paid 5.00 5.00 233.98 246.48

Note 13 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013 LONG - TERM LOANS AND ADVANCES Unsecured (Considered good) (a) Security deposits 0.47 1.12 (b) Loans to employees 1.14 2.13 (c) Loans to others 5.07 2.10 (d) Capital advances 0.32 0.06 (e) Prepaid expenses 0.11 0.27 (f) Deposits with government and others 1.08 0.68 8.19 6.36

20th ANNUAL REPORT 2013 - 14 83 Notes forming part of Financial Statements

Note 14 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

CURRENT INVESTMENTS - OTHERS a) Investments in Mutual Funds (Unquoted) Baroda Pioneer Dynamic Bond Fund - Dividend Plan Payout - 20.00 Religare Invesco Short Term Plan - Plan A Weekly Dividend - Reinvestment - 26.20 Taurus Short Term Income Fund - Monthly Dividend Reinvestment - 5.15 Religare Invesco Bank Debt Fund - 10.13 Axis Banking Debt Fund - Direct - Daily Dividend Reinvestment - 10.10 HDFC Floating Rate Income Fund - Short Term - Weekly Payout - Direct - Daily Dividend Reinvestment - 5.02 Morgan Stanley Short Term Bond Fund - Direct - Weekly Dividend Reinvestment - 20.45 SBI Magnum Insta Cash - Liquid Floater - Direct - Daily Dividend Reinvestment - 7.53 BNP Paribas Short Term Income Fund - Direct - Monthly Dividend Payout - 15.05 DWS Treasury Fund - Investment - Direct - Growth - 5.76 Morgan Stanley Liquid Fund - Direct - Growth - 20.05 Religare Invesco Credit Opportunities Fund - Direct - Growth - 28.02 Baroda Pioneer Liquid Fund - Plan B - Direct - Growth - 21.00 Sundaram Ultra Short Term Fund - Direct - Growth - 30.00 Birla Sun Life Cash Plus - Direct - Growth 25.00 - SBI Premier Liquid Fund - Direct - Daily Dividend Reinvestment 5.93 - IDFC Cash Fund - Direct - Daily Dividend Reinvestment 7.62 - Reliance Liquid Fund Treasury Plan- Direct - Daily Dividend Reinvestment 25.13 - ICICI Prudential Liquid Direct Plan Daily Dividend Reinvestment 18.29 - Birla Sun Life Cash Plus Direct Daily Dividend Reinvestment 25.91 - Tata Liquid Fund-Direct- Daily Dividend Reinvestment 10.72 - HDFC Liquid Fund Direct Daily Dividend Reinvestment 18.22 - Kotak Liquid Plan A - Direct - Daily Dividend Reinvestment 8.61 - L & T Liquid Fund - Direct - Daily Dividend Reinvestment 13.76 - UTI Liquid Fund - Cash Plan - Direct - Daily Dividend Reinvestment 13.66 - HDFC Cash Mgmt Savings Plan - Direct - Growth 15.00 - Reliance Liquidity Fund - Direct - Growth 20.00 - Tata Liquid Fund - Direct - Growth 36.75 - Birla Sun Life Folating Rate Fund - Short Term Plan - Direct - Growth 50.00 - HDFC Liquid Fund - Direct - Growth 10.00 - ICICI Prudential Liquid - Direct - Growth 30.00 - IDFC Cash Fund - Direct - Growth 7.80 - L & T Liquid Fund - Direct - Growth 16.00 - SBI Premier Liquid Fund - Direct - Growth 10.00 - DSP BlackRock Liquidity Fund - Direct Plan - Growth 7.00 - Kotak Liquid Scheme Plan A - Direct - Growth 15.00 - Reliance Liquid Fund Treasury Plan Direct Growth 25.00 - 415.40 224.46 b) Investments in Mutual Funds (Quoted)* Birla Sun Life Fixed Term Plan Series DU - Growth - 2.00 JP Morgan India Fixed Maturity Plan Series 6 - Growth - 4.00 ICICI Prudential Fixed Maturity Plan Series-62-396D-Plan F-Growth - 2.50 Birla Fixed Term Fund- Series ES-Growth - 2.00 HDFC Fixed Maturity Plan 400D February 2012 (1) -Growth - 2.50 Axis Fixed Term Plan - Series 21 - Growth - 2.50 Tata Fixed Maturity Plan Series 39 -Scheme G - Growth - 2.50 ICICI Prudential Fixed Maturity Plan - Series 63 - Plan A - Growth - 5.00 BSL Fixed Term Plan - Series EV - Growth - 5.00 Kotak Fixed Maturity Plan - Series 80 - Growth - 5.00 Reliance Fixed Horizon Fund - Series XXI - Series 18 - Growth - 5.00 Reliance Yearly Interval Fund - Series 1 - Direct - Growth 5.00 - Tata Fixed Maturity Plan - Series 42 Scheme H - Direct Plan - Growth 2.00 - BNP Paribas Fixed Term Fund Series - 24A - Direct - Growth 3.00 - DWS Fixed Maturity Plan - Series 26 - Direct - Growth 2.50 - JP Morgan Fixed Maturity Plan Series 16 - Direct Growth 5.00 - Birla Sun Life Fixed Term Plan - Series JY (367 Days) Direct - Growth 5.00 - Birla Sun Life Fixed Term Plan - Series JZ (368 Days) Direct - Growth 3.00 - DSP BlackRock Fixed Maturity Plan - Series 144 -12M - Direct - Growth 5.00 - Reliance Fixed Horizon Fund-XXV- Series 18- Direct - Growth 3.00 - Tata Fixed Maturity Plan Series 46 L - Direct - Growth 5.00 - ICICI Prudential Fixed Maturity Plan Series 72 - 366 Days - Plan K - Direct - Growth 5.00 - Birla Sun Life Fixed Term Plan - Series KC (368 Days) Direct - Growth 2.00 - HDFC Fixed Maturity Plan 370D February 2014 (1) - Series 29 - Direct - Growth 4.00 - ICICI Prudential Fixed Maturity Plan Series 72 - 366 Days - Plan M - Direct - Growth 4.00 - JP Morgan Fixed Maturity Plan Series 31 - Direct - Growth 7.00 - Kotak Fixed Maturity Plan Series 137 - Direct - Growth 2.00 - IDFC Fixed Maturity Plan Series 76 (366 Days) - Direct - Growth 2.00 - Kotak Fixed Maturity Plan Series 143 - Direct - Growth 3.00 - L & T Fixed Maturity Plan Series 10 - Plan N - Direct - Growth 5.00 - DSP BlackRock Fixed Maturity Plan - Series 151 - 12 M - Direct - Growth 5.00 - * (Note: Market value of quoted investments ` 79.72 Crore ( P.Y. ` 42.19 Crore)) 77.50 38.00 492.90 262.46

84 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Notes forming part of Financial Statements

Note 15 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

TRADE RECEIVABLES (Unsecured, considered good unless otherwise stated) (a) Trade receivables due for a period exceeding six months Considered good 1.10 0.53 Considered doubtful 1.77 3.42 2.87 3.95 Less : Allowances for doubtful debts 1.77 3.42 1.10 0.53 (b) Other trade receivables Considered good 113.82 124.06 Considered doubtful - - 113.82 124.06 Less : Allowances for doubtful debts - - 113.82 124.06

114.92 124.59

Note 16 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

CASH AND BANK BALANCES (A) Cash and cash equivalents (a) Cash on hand 0.02 0.02 (b) Cheques, drafts on hand / funds in transit (Refer note 16 (ii)) 35.15 1.44 (c) Current account with banks (Refer note 16 (i)) 50.14 16.74 (d) Pledged/lien with banks - 0.02 (e) Bank deposits less than 3 months maturity 2.25 - 87.56 18.22

(B) Other bank balances (with more than 3 months but less than 12 months maturity) (a) Earmarked balance with banks 1.04 0.80 (b) Pledged/lien with banks 0.27 0.04 1.31 0.84 (C) Other bank balances (with more than 12 months maturity) (a) Pledged/lien with banks 0.03 0.01 0.03 0.01

88.90 19.07 Notes : (i) In foreign currencies 45.23 14.93 (ii) Remittances in transit 22.62 -

20th ANNUAL REPORT 2013 - 14 85 Notes forming part of financial statements

Note 17 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

OTHER CURRENT ASSETS

(a) Interest accrued on deposits and investments 0.30 0.30 (b) Unbilled revenue 2.58 1.19 (c) Advances to suppliers and contractors 1.42 4.92 (d) Prepaid expenses 3.74 2.99 (e) Unamortized premium on forward contract - 0.03 (f) Others (VAT, Service tax, other taxes recoverables, etc.) 0.42 2.61 8.46 12.04

Note 18 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

SHORT TERM LOANS AND ADVANCES Unsecured (considered good, unless otherwise stated) (a) Inter corporate deposits (Refer Note 25 (vi) (b)) - 183.90 (b) Loans and advances to related parties 9.74 12.23 (c) Security deposits 1.00 0.34 (d) Loans and advances employees 0.41 0.33 Less : Allowances for doubtful loans and advances (0.04) (0.04) (e) Deposits with government and others 0.05 0.08 11.16 196.84

Note 19 (Amount in ` Crore)

Particulars Year ended Year ended March 31, 2014 March 31, 2013

REVENUE FROM OPERATIONS (a) Sale of products 122.12 102.26 (b) Sale of services 762.89 671.54 (c) Commission income 1.17 0.90 886.18 774.70

86 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Notes forming part of financial statements

Note 20 (Amount in ` Crore)

Particulars Year ended Year ended March 31, 2014 March 31, 2013

OTHER INCOME (a) Interest income-others 11.95 7.46 (b) Interest income-Long term investments 0.55 0.58 (c) Dividend income - Other current investments 13.67 14.34 (d) Dividend income - Non current investments 0.18 - (e) Foreign currency gain (net) 2.31 1.45 (f) Doubtful debts written back 1.64 - (g) Profit on sale of investments (net) 4.74 3.92 (h) Other non-operating income * 8.12 15.58 43.16 43.33

* Other non-operating income includes provisions no longer required, written back 7.31 13.37

Note 21 (Amount in ` Crore)

Particulars Year ended Year ended March 31, 2014 March 31, 2013

CONSULTANCY FEES, SOFTWARES AND OTHERS (a) Outsourcing charges 26.80 18.58 (b) Software-internal use 0.50 1.97 (c) Professional fees 33.50 20.13 60.80 40.68

Note 22 (Amount in ` Crore)

Particulars Year ended Year ended March 31, 2014 March 31, 2013

EMPLOYEE BENEFIT EXPENSE (a) Salaries and wages 361.88 317.38 (b) Contribution to provident fund 12.59 11.23 (c) Contribution to superannuation scheme 4.46 3.10 (d) Contribution to gratuity fund 6.15 2.50 (e) Staff welfare expenses 14.53 10.97 399.61 345.18

Note 23 (Amount in ` Crore)

Particulars Year ended Year ended March 31, 2014 March 31, 2013

FINANCE COSTS Interest Expense Interest on short term borrowings 1.39 1.53 Interest on long term borrowings 0.04 0.09 1.43 1.62

20th ANNUAL REPORT 2013 - 14 87 Notes forming part of financial statements

Note 24 (Amount in ` Crore)

Particulars Year ended Year ended March 31, 2014 March 31, 2013

OTHER EXPENSES (a) Repairs & maintenance - Buildings 0.41 0.43 - Plant & machinery 0.39 0.72 - Others 3.92 3.22 (b) Rent* 7.14 5.54 (c) Rates and taxes 0.39 0.43 (d) Provision for wealth tax 0.01 0.01 (e) Insurance 0.38 0.40 (f) Advertisement and publicity - 0.01 (g) Business promotion expenses 2.76 1.02 (h) Office expenses 4.52 3.89 (i) Travelling & conveyance 15.32 13.21 (j) Power & fuel 3.68 3.25 (k) Water charges 0.48 0.28 (l) Auditors remuneration** 0.46 0.56 (m) Staff training and seminar expenses 1.84 2.24 (n) Staff recruitment expenses 1.08 1.71 (o) Commision to others 5.24 5.07 (p) AMC charges 16.33 9.49 (q) Communication expenses 6.06 5.32 (r) Allowances for doubtful debts - 0.81 (s) Bad debts written off 1.80 - (t) Miscellaneous Expenses 1.61 0.86 73.82 58.47

*Obligations under operating lease (Amount in ` Crore) Year ended Year ended Particulars March 31, 2014 March 31, 2013

Lease Obligations Dues not later than one year 2.81 4.01 Due later than one year but not later than five years 1.01 3.75 3.82 7.76 Lease payments recognised in the statement of profit and loss for the year 7.14 5.54

The Company has entered into operating lease arrangements for office premises.

**Auditors' Remuneration (Excluding Service tax) (Amount in ` Crore)

Particulars Year ended Year ended March 31, 2014 March 31, 2013

i) For services as auditors, including quarterly audits 0.35 0.30 ii) For Tax audit/Transfer pricing audit 0.04 0.24 iii) For other attest services 0.05 0.01 iv) Reimbursement of out-of-pocket expenses 0.02 0.01 0.46 0.56

88 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Additional information to the Financial Statements

Note 25 (i): Earning per Share

Particulars March 31, 2014 March 31, 2013

(a) Profit after tax` Crore 202.72 201.22 (b) The weighted average number of Ordinary Shares for Basic EPS Nos. 43,024,138 43,023,538 (c) The nominal value per Ordinary Share ` 10.00 10.00 (d) Earnings Per Share (Basic) ` 47.12 46.77 (e) Profit after tax for Diluted EPS` Crore 202.72 201.22 (f) The weighted average number of Ordinary Shares for Basic EPS Nos. 43,024,138 43,023,538 (g) Add: Adjustment for Employee Stock Options Nos. 14,051 14,651 (h) The weighted average number of Ordinary Shares for Diluted EPS Nos. 43,038,189 43,038,189 (i) Earnings Per Shares (Diluted) ` 47.10 46.76

Note 25 (ii): Contingent Liabilities (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

(a) Bills discounted 113.61 66.69 (b) Income Tax demands disputed in appeals 2.11 2.00 (c) Sales Tax demands disputed in appeals 21.83 21.81 (d) Service Tax demands disputed in appeals 8.67 7.72 (e) Corporate Guarantees issued to Bank in respect of loan taken by subsidiary companies 159.71 217.12

Note 25 (iii): Derivative transactions The Company uses forward exchange contracts to hedge its exposure in foreign currency. The information on derivative instruments is as follows:

1 . Derivative instruments outstanding as at March 31, 2014:

Amount in Amount in Particulars As At Bought/sold Foreign currency ` crore in crore Forward March 31, 2014 Sold GBP/INR GBP 0.17 16.92 Exchange contracts March 31, 2013 Sold GBP/USD GBP 0.40 32.84

20th ANNUAL REPORT 2013 - 14 89 Additional information to the Financial Statements

2. Foreign exchange currency exposures not covered by derivative instruments (Amount in ` Crore) As At March 31, 2014 As At March 31, 2013 Amount in Equivalent Amount in Equivalent Particulars Currency Foreign Currency Amount in ` Foreign Currency Amount in ` Trade Receivables EUR 0.13 11.01 0.06 4.17 CAD 0.00 0.22 - - GBP 0.03 3.27 0.09 7.29 THB - - 0.02 0.05 USD 0.40 23.96 0.34 18.30 ZAR 0.02 0.09 0.01 0.07

Loans & Advances EUR 0.00 0.37 0.01 0.42 GBP 0.01 1.02 0.08 6.43 THB 0.04 0.08 0.15 0.28 USD 0.13 7.56 0.07 3.66 ZAR - - 0.01 0.04

Trade Payables EUR 0.01 0.56 0.01 0.89 GBP 0.00 0.01 0.00 0.07 JPY - - 0.01 0.00 SGD 0.00 0.03 0.00 0.00 THB 0.75 1.38 0.91 1.69 USD 0.06 3.49 0.16 8.47

Unsecured Loan USD 1.50 89.84 1.00 54.28

Current account USD 0.30 18.22 0.20 11.04 with Bank EUR 0.00 0.28 0.04 3.10 GBP 0.27 26.73 0.01 0.79

Note 25 (iv) Dues to micro, small and medium scale enterprises Based on the information available with the Company, none of the vendors fall under the definition of micro, small and medium scale enterprises. This information is not verifiable by the auditors.

90 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Additional information to the Financial Statements

Note 25 (v) Segment Reporting

Primary Segment - Business The Company's operations entail providing 'Information Technology Products and Services' which constitute a single segment for primary segment reporting. Accordingly, the figures given in these financial statements relate to the Company's single business segment.

Secondary Segment - Geographic Secondary segmental reporting is prepared on the basis of geographical location of the customers.

(Amount in ` Crore) Rest of Particulars India UK USA Rest of the Total Europe World Revenues 629.05 160.35 59.55 17.75 19.48 886.18 548.31 133.71 65.44 15.88 11.36 774.70 Identifiable operating expenses 428.25 72.76 43.88 12.83 11.39 569.11 346.07 63.94 44.14 11.43 8.08 473.66 Allocated expenses 21.27 8.64 3.18 0.96 0.75 34.79 13.06 6.21 3.02 0.74 0.53 23.56 Segmental operating income 179.53 78.95 12.49 3.97 7.34 282.28 189.18 63.56 18.28 3.71 2.75 277.48 Unallocable expenses 64.71 57.16 Other Income 41.73 41.72 Net profit before taxes 259.30 262.04 Income taxes 56.58 60.82 Net profit after taxes 202.72 201.22

Fixed assets used in the Company's business or liabilities contracted have not been identified to any of the reported segments, as fixed assets and services are used interchangeably between reported segments.

Figures for comparative period have been presented in accordance with the reporting in the current period. There has been no financial impact due to change in segment reporting in the current year.

Previous year figures are shown in italic.

20th ANNUAL REPORT 2013 - 14 91 Additional information to the Financial Statements

Note 25 (vi) Related Party Disclosures for the year ended March 31, 2014. a) Related party and their relationship

1 Parent Company Tata Motors Limited

2 Subsidiary Tata Technologies Pte.Limited, Singapore

3 Indirect Subsidiaries 1 Tata Technologies (Thailand) Limited 2 INCAT International Plc. 3 Tata Technologies Europe Limited 4 INCAT GmbH 5 Tata Technologies Inc 6 Tata Technologies de Mexico, S.A. de C.V. 7 Tata Technologies (Canada) Inc. 8 Cambric Holdings Inc. 9 Cambric Corporation, Delaware 10 Cambric Limited, Bahama 11 Cambric UK Ltd. 12 Cambric Managed Services Inc, Utah 13 Cambric GmbH 14 Midwest Managed Services, Utah 15 Cambric Consulting SRL, Romania 16 Cambric Manufacturing Technologies (Shanghai) Co. Ltd. (incorporated w.e.f. March 10, 2014)

4 Fellow subsidiaries 1 TAL Manufacturing Solutions Ltd. 2 TML Driveline Ltd. 3 Sheba Properties Ltd. 4 Concorde Motors (India) Ltd. 5 Tata Daewoo Commercial Vehicle Co.Ltd. 6 Tata Motors Insurance Broking & Advisory Services Ltd. 7 Tata Motors European Technical Centre Plc. 8 Tata Motors Finance Limited 9 Tata Marcopolo Motors Ltd. 10 Tata Motors (Thailand) Ltd. 11 TML Holdings Pte Ltd. 12 TML Distribution Company Limited 13 Tata Hispano Motors Carrocera S.A. 14 PT Tata Motors Indonesia 15 Tata Motors (SA) (Proprietary) Limited 16 Jaguar Land Rover Automotive PLC (Erstwhile Jaguar Land Rover PLC name changed w.e.f. 28.12.2012 and the name changed from Jaguar Land Rover Limited on 06.04.11) 17 Jaguar Land Rover Limited (JLR Ltd. acquired business and assets of Jaguar Land Rover Exports Ltd. on 1.4.2013 (other than its nominee shareholdings in Jaguar Land Rover Portugal, Jaguar Land Rover Brasil, Land Rover Belux S.A./N.V., Jaguar Belux N.V and membership in British Motor Industry Heritage Trust)) 18 Jaguar Land Rover Austria GmbH 19 Jaguar Land Rover Japan Ltd. 20 JLR Nominee Company Limited (Business of Land Rover Exports Limited transferred w.e.f. 1.4.2012 to Jaguar Land Rover Exports Ltd. And name changed from Jaguar Land Rover Exports Ltd w.e.f. 1.7.2013) 21 Jaguar Cars South Africa (pty) Ltd 22 The Daimler Motor Company Ltd 23 The Jaguar Collection Ltd 24 Daimler Transport Vehicles Ltd

92 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Additional information to the Financial Statements

25 S.S. Cars Ltd 26 The Lanchester Motor Company Ltd 27 Jaguar Land Rover Deutschland GmbH 28 Land Rover Group Ltd 29 Jaguar Land Rover North America LLC 30 Jaguar Land Rover Belux (Land Rover Belux S.A./N.V merged with Jaguar Belux N.V. w.e.f. October 1, 2013 and name changed from Jaguar Belux to Jaguar Land Rover Belux w.e.f. November 12, 2013) 31 Land Rover Ireland Ltd 32 Jaguar Land Rover Nederland BV 33 Jaguar Land Rover Portugal - Veiculos e Pecas LDA 34 Jaguar Land Rover Australia Pty Ltd. 35 Jaguar Land Rover Italia SpA 36 Jaguar Land Rover Espana SL (Jaguar Hispania SL was absorbed into Land Rover Eispana SL w.e.f. January 1, 2013 and the name was changed to Jaguar Land Rover Espana SL) 37 Jaguar Land Rover Korea Company Ltd 38 Jaguar Land Rover Automotive Trading (Shanghai) Company Ltd. 39 Jaguar Land Rover Canada ULC 40 Jaguar Land Rover France, SAS 41 Jaguar Land Rover (South Africa) (Pty) Ltd. 42 Jaguar e Land Rover Brasil Importacao e Comercia de Veiculos Ltda 43 Limited Liability Company "Jaguar Land Rover" (Russia) 44 Land Rover Parts Limited 45 Jaguar Land Rover (South Africa) Holdings Ltd. 46 Land Rover Exports Limited (Business transferred to Jaguar Land Rover Exports Limited on 1.4.2012) 47 Jaguar Land Rover India Limited (incorporated w.e.f October 25, 2012) 48 Jaguar Cars Limited 49 Tata Hispano Motors Carrocera S.A. 50 Tata Hispano Motors Carrocerries Maghreb S.A. 51 Tata Daewoo Commercial Vehicle Sales and Distribution Co. Ltd. 52 Tata Precision Industries Pte. Ltd. 53 Trilix S.r.l. 54 PT Tata Motors Distribusi Indonesia (Incorporated w.e.f February 11, 2013) 55 Jaguar Land Rover Holdings Ltd. ( all business and assets of Land Rover were acquired by Jaguar Land Rover Ltd. Except Jaguar Land Rover Automotive Trading (Shangai) Company Ltd. On January 1, 2013 and name changed from Land Rover w.e.f. October 4, 2013)

5 Joint Venture TATA HAL Technologies Limited

6 Associates and Joint 1 Tata Cummins Ltd Venture of Parent Company 2 Tata Precision Industries (India) Ltd. 3 Fiat India Automobiles Ltd. 4 Spark44 (JV) Ltd. 5 Jaguar Cars Finance Ltd. 6 Automobile Corporation of Goa Ltd 7 Nita Co Ltd 8 Cherry Jaguar Land Rover Automotive Co. Limited 9 Tata Hitachi Construction Machinery Company Limited (Erstwhile Telco Construction Equipment Co.Ltd. name changed w.e.f November 23, 2012) 10 Tata AutoComp Systems Ltd 11 Suzhou Chery Jaguar Land Rover Trading Co. Ltd (Interim JV)

7 Key Management Personnel Mr. P. R. McGoldrick

20th ANNUAL REPORT 2013 - 14 93 Additional information to the Financial Statements

Note 25 (vi) Related Party Disclosures for the year ended March 31, 2014. b) Transactions with related parties (Amount in ` Crore) Associates & Key Parent Fellow Joint Joint Venture Subsidaries Management Total Particulars Company subsidiaries Venture of Parent company Personnel

Purchase of products - - 0.16 - - - 0.16 (-) (-) (0.77) (-) (-) (-) (0.77)

Sale of products 39.56 2.29 0.73 3.28 1.82 - 47.68 (35.03) (1.90) (1.21) (0.97) (0.04) (-) (39.15)

Services received - - 28.41 1.13 - - 29.54 (-) (0.36) (12.00) (0.28) (-) (-) (12.64)

Services rendered 439.35 19.28 238.58 - 2.44 - 699.65 (387.39) (15.57) (210.64) (-) (2.25) (-) (615.85)

Finance placed (including 926.60 - - - - - 926.60 loans, equity & ICD) (817.65) (-) (-) (0.75) (-) (-) (818.40)

Finance received back 1,110.50 0.00 - - - - 1,110.50 (including loans, equity & ICD) (635.75) (20.01) (-) (-) (-) (-) (655.76)

Dividend paid 84.84 - - - - - 84.84 (48.48) (-) (-) (-) (-) (-) (48.48)

Interest paid / (received)(net) (11.62) (0.55) - - - - (12.17) (-5.24) (-0.60) (-) (-) (-) (-) (-5.84)

Remuneration - - - - - 0.30 0.30 (-) (-) (-) (-) (-) (0.30) (0.30)

Amount receivable 31.47 5.89 57.78 0.32 0.60 - 96.06 (28.38) (4.21) (69.76) (0.12) (1.16) (-) (103.63)

Amount payable 2.10 - 4.18 1.13 - 0.20 7.61 (0.62) (-) (5.93) (-) (-) (0.20) (6.75)

Amount receivable (in respect - 5.29 - - - - 5.29 of loans, Equity, ICD, Bonds) (183.90) (5.29) (-) (-) (-) (-) (189.19)

Amount payable (in respect ------of loans, Equity, ICD, Bonds) (-) (0.02) (-) (-) (-) (-) (0.02)

* Previous year's figures are shown in the brackets

Disclosure of material transactions: Purchase of goods: Tata Technologies Inc. ` 0.16 crore (March 31, 2013 ` 0.77 crore) Services received: Tata Technologies Europe Limited ` 4.07 crore (March 31, 2013 ` Nil) Tata Technologies Thailand Limited ` 7.46 crore (March 31, 2013 ` 4.64 crore) Tata Technologies Pte. Limited ` 5.09 crore (March 31, 2013 ` 4.65 crore) Tata Technologies Inc. ` 11.78 crore (March 31, 2013 ` 2.46 crore) Services rendered: Tata Technologies Europe Limited ` 170.55 crore (March 31, 2013 ` 140.09 crore)

94 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Additional information to the Financial Statements

Note 25 (vii)

The Company has a joint venture with Hindustan Aeronautics Ltd., TATA HAL Technologies Ltd (THTL) for providing engineering and design solutions and services in the domain of aerostructures for aerospace industry. The Company has an investment of ` 5.07 crores as at March 31, 2014, representing 50% shareholding in THTL. The proportionate share of assets and liabilities as on March 31, 2014 and income and expenditure for the year ended March 31,2014 of THTL are given below. (Amount in ` Crore) As on As on Year Ended Year Ended Particulars March 31, March 31, Particulars March 31, March 31, 2014 2013 2014 2013 RESERVES AND SURPLUS INCOME Profit & Loss (3.62) (2.83) Service Income 4.09 2.62 (3.62) (2.83) Other income 0.57 0.20 Sub Total 4.66 2.82 NON-CURRENT LIABILITIES 0.09 0.09

CURRENT LIABILITIES 1.39 0.92 (2.14) (1.82)

NON-CURRENT ASSETS Net Block (including CWIP) 0.37 0.54 EXPENDITURE Long Term Loans and Advances 0.35 0.48 Cost of Traded Items & Services 1.34 - Sub Total 0.72 1.02 Salary & other general expenses 3.78 2.44 CURRENT ASSETS Depreciation 0.32 0.26 Trade Receivables 1.83 0.91 Sub Total 5.44 2.70 Projects work in progress 0.10 0.19 Cash and Cash Equivalents 0.13 0.43 Short Term loans and advances 0.10 0.12 Other Current Assets 0.04 0.58 Sub Total 2.20 2.23

Total 2.92 3.25

Note 25 (viii)Information as required as per Revised Schedule VI to the Companies Act. (Amount in ` Crore)

Particulars 2013-14 2012-13

Earnings in foreign currency Services & Products 256.17 225.79 Commission 0.27 0.19 Sub Total 256.44 225.98 CIF Value of imports Capital Goods 7.64 8.48 Revenue Items 2.24 2.42 Sub Total 9.88 10.90 Expenditure in foreign currency: Travel / Training Expenses 3.73 2.79 Software services 25.61 19.95 Interest 0.79 1.10 Commission 5.24 4.73 Other expenses 0.39 0.73 Sub Total 35.76 29.30

20th ANNUAL REPORT 2013 - 14 95 Additional information to the Financial Statements

Note 25 (ix) Remittances in Foreign Currency for Dividend The particulars of dividends remitted in foreign currencies to non-resident shareholders are as under:

Particulars 2013 - 14 2012 - 13

Number of non-resident shareholders FY 2011-12 - Final dividend No. - 15 FY 2012-13 - Interim dividend No. - 19 FY 2012-13 - Final dividend No. 18 - FY 2013-14 - Interim dividend No. 18 -

Number of shares held by them FY 2011-12 - Final dividend No. - 7,222,402 FY 2012-13 - Interim dividend No. - 7,251,902 FY 2012-13 - Final dividend No. 7,251,902 - FY 2013-14 - Interim dividend No. 7,251,902 -

Gross amount of dividend FY 2011-12 - Final dividend` Crore - 4.73 FY 2012-13 - Interim dividend` Crore - 6.52 FY 2012-13 - Final dividend` Crore 11.60 - FY 2013-14 - Interim dividend` Crore 8.68 -

Note 25 (x)

Previous year figures have been regrouped/reclassified wherever necessary to correspond with the current year classifications / disclosures.

96 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Independent Auditors' Report

TO THE BOARD OF DIRECTORS OF TATA TECHNOLOGIES LIMITED

Report on the Consolidated Financial Statements We have audited the accompanying consolidated financial statements of TATA TECHNOLOGIES LIMITED ( the “Company”), its subsidiaries and jointly controlled entity (the Company, its subsidiaries and jointly controlled entity constitute “the Group”), which comprise the Consolidated Balance Sheet as at 31st March, 2014, the Consolidated Statement of Profit and Loss and the Consolidated Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management's Responsibility for the Consolidated Financial Statements The Company's Management is responsible for the preparation of these consolidated financial statements that give a true and fair view of the consolidated financial position, consolidated financial performance and consolidated cash flows of the Group in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the consolidated financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors' Responsibility Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the consolidated financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company's preparation and presentation of the consolidated financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion In our opinion and to the best of our information and according to the explanations given to us, the aforesaid consolidated financial statements give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) in the case of the Consolidated Balance Sheet, of the state of affairs of the Group as at 31st March, 2014; (b) in the case of the Consolidated Statement of Profit and Loss, of the profit of the Group for the year ended on that date and (c) in the case of the Consolidated Cash Flow Statement, of the cash flows of the Group for the year ended on that date.

Other Matter We did not audit the financial statements of 4 subsidiaries, whose financial statements reflect total assets (net) of `` 411.71 Cr as at 31st March, 2014, total revenues of 969.58 Cr and net cash outflows amounting to ` 3.22 Cr for the year ended on that date, as considered in the consolidated financial statements. These financial statements have been audited by other auditors whose reports have been furnished to us by the Management and our opinion, in so far as it relates to the amounts and disclosures included in respect of these subsidiaries, is based solely on the reports of the other auditors.

Our report is not qualified in respect of this matter.

Sunil S Kothari For Deloitte Haskins & Sells LLP Partner Chartered Accountants (Membership No. 208238) (Firm Registration No. 117366W/W-100018)

Date: May 15, 2014 Place: Pune

20th ANNUAL REPORT 2013 - 14 97 Consolidated Balance Sheet as at March 31, 2014

(Amount in ` Crore) Particulars Note No. March 31, 2014 March 31, 2013

I. EQUITY AND LIABILITIES (1) Shareholders' Funds (a) Share capital 3 43.02 43.02 (b) Reserves and surplus 4 1,137.62 909.85 1,180.64 952.87 (2) Non-current Liabilities (a) Long-term borrowings 5 199.68 144.92 (b) Deferred tax liabilities (Net) 6 3.44 4.56 (c) Trade payables 0.45 0.37 (d) Long-term provisions 7 17.61 9.48 221.18 159.33 (3) Current Liabilities (a) Short-term borrowings from banks 8 131.01 79.17 (b) Trade payables 385.16 294.53 (c) Other current liabilities 9 192.14 157.00 (d) Short-term provisions 10 97.23 83.39 (e) Income tax liabilities (Net) 15.73 34.09 821.27 648.18

2,223.09 1,760.38 II. ASSETS (1) Non-current Assets (a) Fixed assets (i) Tangible assets 11 85.40 69.72 (ii) Intangible assets 12 45.71 39.24 (iii) Capital work-in-progress 0.57 13.67 (iv) Intangible assets under development 1.88 3.29 133.56 125.92

(b) Goodwill (i) Goodwill on consolidation (Refer Note 27 (iii) (a)) 489.98 404.60 (ii) Goodwill on acquisition (Refer Note 27 (iii) (b)) 155.37 - 645.35 404.60

(c) Non-current investments 13 10.00 22.50 (d) Deferred tax assets (Net) 6 14.34 6.83 (e) Long-term loans and advances 14 40.42 24.36 (f) Income tax assets (Net) 26.36 13.34 870.03 597.55 (2) Current Assets (a) Current investments 15 492.90 262.46 (b) Inventories - 0.06 (c) Trade receivables 16 307.01 315.71 (d) Cash and bank balances 17 465.45 306.15 (e) Other current assets 18 73.90 80.28 (f) Short-term loans and advances 19 6.94 189.58 (g) Current income tax assets 6.86 8.59 1,353.06 1,162.83

2,223.09 1,760.38 Significant Accounting Policies 2 Accompanying Notes to the Financial Statements 27

In terms of our report attached For and on behalf of the Board For Deloitte Haskins & Sells LLP Chartered Accountants S Ramadorai P R McGoldrick Chairman Managing Director R Gopalakrishnan Samrat Gupta Sunil S Kothari Director Chief Financial Officer Partner P P Kadle Anubhav Kapoor Date: May 15, 2014 Director Company Secretary Place: Pune C Ramakrishnan Director Date: May 15, 2014 Place: Mumbai 98 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Statement of Consolidated Profit and Loss for the year ended March 31, 2014

(Amount in ` Crore) Year ended Year ended Particulars Note No March 31, 2014 March 31, 2013

I. Revenue from operations 20 2,344.45 1,995.00 II. Other income 21 50.28 50.42 III. Total Revenue (I + II) 2,394.73 2,045.42 IV. Expenses : (a) Cost of traded products 22 402.23 349.40 (b) Consultancy fees, softwares and others 23 367.47 281.25 (c) Employee benefits expense 24 1,055.21 847.90 (d) Finance costs 25 7.66 7.62 (e) Depreciation and amortisation expense 11 & 12 48.11 33.09 (f) Other expenses 26 176.48 133.73 Total Expenses 2,057.16 1,652.99

V. Profit before tax (III - IV) 337.57 392.43

VI. Tax Expense : (a) Current tax 72.15 90.51 (b) Deferred tax (7.80) 1.19 64.35 91.70 VII. Profit after tax (V - VI) 273.22 300.73

VIII. Earnings Per Equity Share : (Refer Note 27(i)) (i) Basic 63.51 69.90 (ii) Diluted 63.48 69.88

Significant Accounting Policies 2 Accompanying Notes to the Financial Statements 27

In terms of our report attached For and on behalf of the Board For Deloitte Haskins & Sells LLP S Ramadorai P R McGoldrick Chartered Accountants Chairman Managing Director R Gopalakrishnan Samrat Gupta Sunil S Kothari Director Chief Financial Officer Partner P P Kadle Anubhav Kapoor Date: May 15, 2014 Director Company Secretary Place: Pune C Ramakrishnan Director Date: May 15, 2014 Place: Mumbai

20th ANNUAL REPORT 2013 - 14 99 Consolidated Cash Flow Statement (Amount in ` Crore) Year ended Year ended Consolidated Cash Flow Statement for the March 31, 2014 March 31, 2013

CASH FLOW FROM OPERATING ACTIVITIES Net profit after taxation and extraordinary items 273.22 300.73 Depreciation and amortization 48.11 33.09 Disallowance of TDS abroad 0.28 0.30 Provision for wealth taxes 0.01 0.01 Provision for income tax 72.15 90.51 Provision for deferred tax (7.80) 1.19 Dividend income on investments (13.85) (14.34) (Profit)/Loss on sale of investment (4.74) (3.92) (Profit) / Loss on sale of tangible and intangible fixed assets 0.22 - Finance cost 7.66 7.62 Interest income (14.40) (11.38) Unrealised exchange loss / (gain) (2.15) (0.52) Effect of exchange differences on translation of foreign currency cash & cash equivalent (0.23) (0.40) Allowances for doubtful debts (6.99) (1.19) Operating profit before working capital changes 351.49 401.70 Adjustments for : Inventories 0.07 (0.01) Trade receivables 84.56 (13.56) Other current assets 12.41 (0.40) Short term loans and advances 6.03 0.55 Long term loans and advances (7.77) (3.46) Trade payables (7.96) 45.49 Other current liabilities 13.29 (4.46) Short term provision 3.24 (0.14) Long term provision 7.60 1.68 CASH GENERATED FROM OPERATIONS 462.96 427.39

Income taxes paid (net) (98.77) (73.49)

NET CASH FLOW (USED IN)/GENERATED FROM OPERATING ACTIVITIES 364.19 353.90

CASH FLOW FROM INVESTING ACTIVITIES Proceeds from sale of tangible and intangible fixed assets 0.30 0.07 Dividend received 1.48 2.83 Income from sale of investment 4.74 3.92 Interest received on bank deposit and others 1.93 6.17 Payment for purchase of tangible and intangible fixed assets (48.58) (40.91) Investment in preference shares - (5.00) Inter corporate deposits placed (926.60) (817.65) Inter corporate deposits refunded 1,110.50 663.75 Loans to others (2.97) 0.12 Interest received from intercorporate deposit 12.47 6.62 Deposits with financial companies - 10.00 Purchase of mutual funds (1,758.02) (1,974.71) Sale of mutual funds 1,552.43 1,896.34 Addition to fixed deposit with banks (net) having maturity over three months (2.93) (8.88) Repayment of fixed deposit with banks (net) having maturity over three months 6.84 51.31 Acquisition of Cambric Holding Inc. (184.56) - NET CASH FLOW (USED IN)/GENERATED FROM INVESTING ACTIVITIES (232.97) (206.02)

CASH FLOW FROM FINANCING ACTIVITIES Proceeds from issue of shares including premium - 0.51 Interest paid (7.87) (7.72) Dividends paid (including dividend tax) (140.70) (79.19) Proceeds from short term borrowngs 302.90 143.22 Repayment of short term borrowings (252.45) (145.24) Proceeds from long term borrowing 119.78 217.12 Repayment of long term borrowings (80.32) (275.07) NET CASH FLOW (USED IN)/GENERATED FROM FINANCING ACTIVITIES (58.66) (146.37)

NET INCREASE / (DECREASE) IN CASH & CASH EQUIVALENTS 72.56 1.51

Cash & Bank balances at the close of the year (Refer Note 17) # 465.45 306.15 Less: Bank deposits with original maturity over three months for the year 3.93 7.83 Cash & Bank balances at the beginning of the year (Refer Note 17) 306.16 342.83 Less: Bank deposits with original maturity over three months for the previous year 7.83 50.27 Cash & cash equivalents of Cambric Holding Inc. as on the date of acquistion 40.51 - Less: Effect of exchange rate changes on cash and cash equivalents (0.23) (0.41) Add: Translation adjustment on cash & bank balances of foreign subsidiaries 50.21 6.67 Add: Translation adjustment on reserves of foreign subsidiaries (0.32) (2.83) 72.56 1.51 # Cash & Bank balances comprises : a) Cash and Cash Equivalents Cash on hand 0.04 0.03 Cheques, drafts on hand / funds in transit 36.74 23.14 Current account with banks 414.31 209.39 Pledged/lien with banks - 0.02 Bank deposits less than 3 months maturity 9.35 64.94 b) Other bank balances (with more than 3 months but less than 12 months maturity) Earmarked balance with banks 1.04 0.80 Bank deposits 3.63 7.78 Pledged/lien with banks 0.27 0.04 c) Other bank balances (with more than 12 months maturity) Pledged/lien with banks 0.03 0.01 Bank deposits 0.04 - 465.45306.15

For and on behalf of the Board In terms of our report attached S Ramadorai P R McGoldrick For Deloitte Haskins & Sells LLP Chairman Managing Director Chartered Accountants R Gopalakrishnan Samrat Gupta Director Chief Financial Officer Sunil S Kothari P P Kadle Anubhav Kapoor Partner Director Company Secretary Date: May 15, 2014 C Ramakrishnan Place: Pune Director Date: May 15, 2014 Place: Mumbai 100 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Notes forming part of Consolidated Financial Statements

Note 1

Company Overview

TATA Technologies Limited ("TTL" or "the Company") was incorporated on August 22, 1994 as a Private Limited Company in the name of Core Software Systems Private Limited. The name of the Company was subsequently changed to Tata Technologies (India) Limited. On February 8, 2001, the Company changed its name from Tata Technologies (India) Limited to Tata Technologies Limited. The Company's range of services include IT Consultancy, SAP implementation and maintenance, providing networking solutions, CAD/CAM engineering & design consultancy. The Company is headquartered in Pune, India. The Company has five branches located at Mumbai, Lucknow, Jamshedpur, Bangalore, and Chennai that enables it to provide high quality, cost-effective services to clients.

During October 2005, the Company incorporated a wholly owned subsidiary in Thailand to cater the need of automotive companies in Thailand and South East Asian countries. Also during October 2005 the Company acquired, through its subsidiary, 100% equity of INCAT International Plc., UK which had various subsidiaries in US, Europe, Japan and Singapore. A reorganization of various entities under INCAT was undertaken, to have a single representative legal entity in each country in which the Company operates, to improve operational efficiency. The Company now has a global presence, through its subsidiaries, in US, UK, Germany, Mexico, Canada, Singapore, South Korea, Netherlands and Thailand.

In December 2005, the Company acquired 100% stake in Tata Technologies Pte Ltd. a Singapore based Company.

In October 2006, the Company sold its 100% equity stake in Tata Technologies (Thailand) Ltd. to its wholly owned subsidiary viz. Tata Technologies Pte Ltd., Singapore at a value determined by an independent valuer.

In May 2013, the Company acquired 100% stake in Cambric Holdings Inc, through its indirect subsidiary viz. Tata Technologies Inc.

The Company provides Engineering and Design services (E&D) and Product Lifecycle Management (PLM) products and services, primarily to manufacturers and their suppliers in the international automotive, aerospace and engineering markets. The offshore capabilities of the Company in the field of engineering automation services combined with the high-end onshore strengths of subsidiaries are expected to offer a strong and seamless onshore/offshore delivery capability to the international customers in the automotive, aerospace and engineering industries.

Note 2

Significant Accounting Policies

a. Basis of consolidation

The consolidated financial statements relate to the Company, its subsidiary companies and joint venture. The Company, its subsidiaries and joint venture constitute the Group.

b. Basis of accounting

The financial statements are prepared under the historical cost convention, in accordance with Indian Generally Accepted Accounting Principles (GAAP). GAAP comprises the mandatory accounting standards notified under the Companies (Accounting Standards) Rules, 2006. Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use. The financial statements of the subsidiary companies and joint venture used in the consolidation are drawn up to the same reporting date as of the Company.

c. Principles of consolidation

The consolidated financial statements have been prepared on the following basis-

a) The consolidated financial statements are prepared in accordance with the principles and procedures required for the preparation and presentation of consolidated financial statements as laid down under the Accounting Standard on Consolidated Financial Statements issued under Companies (Accounting Standards) Rules, 2006.

20th ANNUAL REPORT 2013 - 14 101 b) The financial statements of the Company and its subsidiary companies have been combined on a line by line basis by adding together like items of assets, liabilities, income and expenses. The intra-group balances and intra-group transactions and unrealized profits or losses have been fully eliminated. The consolidated financial statements are prepared by applying uniform accounting policies in use at the Group. c) The excess of cost to the Company of its investments in the subsidiary companies over its share of equity of the subsidiary companies, at the dates on which the investments in the subsidiary companies are made, is recognized as 'Goodwill' being an asset in the consolidated financial statements. Alternatively, where the share of equity in the subsidiary companies as on the date of investment is in excess of cost of investment of the Company, it is recognized as 'Capital Reserve' and shown under the head 'Reserves and Surplus'; in the consolidated financial statements.

d) Minority interest in the net assets of consolidated subsidiaries consists of the amount of equity attributable to the minority shareholders at the dates on which investments are made by the Company in the subsidiary companies and further movements in their share in the equity, subsequent to the dates of investments as stated above.

e) For the purpose of consolidation, the financial statements of foreign subsidiaries have been translated into its immediate parent companies currency and the same has been on the following basis: - All income and expenses items are converted at the average rate of exchange applicable for the year. All assets and liabilities are translated at the closing rate as on the balance sheet date. The resulting exchange differences on account of translation at the year end are transferred to translation reserve.

f) The financial statements of the joint venture company has been combined by using proportionate consolidation method and accordingly, venturer's share of each of the assets, liabilities, income and expenses of jointly controlled entity is reported as separate line item in the consolidated financial statements.

d. Subsidiary Companies considered in the consolidated financial statements: The following subsidiary companies are considered in the consolidated financial statements

% of holding either directly or through subsidiary as at March 31, March 31, Sr. No Name of the Subsidiary Company Country of Incorporation 2014 2013

Direct Subsidiary 1 TATA Technologies Pte. Ltd. Singapore 100 100 Indirect Subsidiaries 2 Tata Technologies (Thailand) Limited Thailand 100 100 3 Cambric Manufacturing Technologies China 100 - (Shanghai) Co. Ltd. © 4 INCAT International Plc. UK 100 100 5 Tata Technologies Europe Limited UK 100 100 6 INCAT GmbH Germany 100 100 7 Tata Technologies Inc. ** USA 99.24 99.24 8 Tata Technologies (Canada) Inc. ** Canada 99.24 99.24 9 Tata Technologies de Mexico, S.A. de C.V ** Mexico 99.24 99.24 10 Cambric Holdings Inc. Delaware, USA 100 - 11 Cambric Corporation, Delaware # Delaware, USA 100 - 12 Cambric Limited, Bahama # Bahama, USA 100 - 13 Cambric UK Ltd. # UK 100 - 14 Cambric Managed Services, Utah # Utah, USA 100 - 15 Cambric GmbH # Germany 100 - 16 Midwest Managed Services, Utah # Utah, USA 100 - 17 Cambric Consulting SRL, Romania # Romania 100 -

** For these subsidiaries though the holding is 99.24 %, the indirect voting power is 100%. # Due to acquisition of Cambric Holdings Inc., these subsidiaries have become indirect subsidiaries of the Company w.e.f. May 01, 2013. © Incorporated w.e.f. March 10, 2014, and there have been no transactions/operations during the year ended March 31, 2014.

102 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION e. The following joint venture company is considered in the consolidated financial statements:

% of holding either directly or through subsidiary as at March 31, March 31, Sr. no Name of the Joint Venture Company Country of Incorporation 2014 2013

1 TATA HAL Technologies Limited India 50 50

f. Conversion into Indian Rupees

For the purpose of consolidation, the financial statements of foreign subsidiaries have been translated into its immediate parent companies currency and the same has been on the following basis:

All income and expenses items are converted at the average rate of exchange applicable for the period. All assets and liabilities are translated at the closing rate as on the balance sheet date. The resulting exchange differences on account of translation at the period end are transferred to translation reserve.

g. Use of Estimates

The preparation of the financial statements in conformity with GAAP requires the management of the Company (Management) to make estimates and assumptions that affect the reported amounts of revenue and expenses during the year and balances of assets and liabilities and disclosures relating to contingent liabilities as at the date of financial statements.

Provisions are made for all known losses and liabilities, future unforeseeable factors that may affect the profit on fixed price service contracts and also towards likely expenses for providing post-sales client support on such contracts.

h. Revenue recognition

Revenue from services on time and materials contracts is recognized when services are rendered and related costs are incurred i.e. based on certification of time sheets and billed to clients as per the terms of specific contracts.In case of fixed price contracts, revenue is recognized over the life of the contract based on milestones achieved as specified in the contracts or by proportionate completion method on the basis of the work completed. Foreseeable losses on such contracts are recognized when probable.

Revenue from rendering Annual Maintenance Services (SAP-ERP) is recognized proportionately over the period in which services are rendered.

Revenue from third party software products and hardware sale is recognized upon delivery.

Income from interest and rent is recognized on time proportion basis.

Dividend from investments is recognized when the right to receive the payment is established and when no significant uncertainty as to measurability or collectability exists.

Commission Income on sale of PLM products is recognized upon delivery of products by the vendor to the end user.

i. Fixed assets

Tangible assets are stated at cost, less accumulated depreciation. Costs include all expenses incurred to bring the assets to its present location and condition. Direct costs are capitalized till the assets are ready for use and include financing costs relating to any borrowing attributable to the acquisition of qualifying fixed assets. Capital work in progress and Intangible assets in progress comprises the cost of fixed assets that are not yet ready for their intended use at the reporting date. Intangible assets are recorded at the consideration paid for acquisition of such assets and are carried at cost less accumulated amortization and impairment.

Software not exceeding ` 25,000 is charged off to the Statement of Profit & Loss.

20th ANNUAL REPORT 2013 - 14 103 j. Depreciation/amortisation

Depreciation/amortisation is provided on Straight Line Method (SLM) over the estimated useful lives of the assets. Estimated useful lives of assets are as follows:

Type of Asset Depreciation Percentage

Leasehold Land Lease Period Leasehold Improvements Lease Period Buildings 4% to 6.67% Plant and Machinery 4.75% to 20% Computer Equipments 25% to 50% Vehicles 9.5% to 33.33% Software Licenses License Period 25% to 50%

Depreciation/amortisation on additions to Fixed Assets is provided from the month of acquisition of the Asset. Depreciation/amortisation on Assets sold / scraped during the period is provided for prior to the month of sale / scrap as the case may be.

The Company charges 100% Depreciation/amortisation on assets individually costing less than ` 5,000 in the year of purchase.

k. Leases

Assets leased by the Company in its capacity as lessee, where the Company has substantially all the risks and rewards of ownership are classified as finance lease. Such lease are capitalised at the inception of the lease at lower of the fair value or the present value of the minimum lease payments and a liability is created for an equivalent amount. Each lease rental paid is allocated between the liability and the interest cost so as to obtain a constant periodic rate of interest on the outstanding liability for each year.

Lease arrangements where the risks and rewards incident to ownership of an asset substantially vest with the lessor, are recognized as operating lease. Lease payments under operating leases are recognized in the Statement of Profit & Loss on a straight line basis.

l. Foreign Currency transactions and translations of foreign operations

Income and expenses in foreign currencies are recorded at the exchange rates prevailing on the date of the transaction.

Monetary current assets and current liabilities that are denominated in foreign currency translated at the exchange rates prevalent as at the Balance Sheet date and the profit / loss so determined and also the realized exchange gains / losses are recognized in the Statement of Profit & Loss.

All foreign operations have been identified as non-integral to the operations of the Company. The translations of functional currency into reporting currency is performed for balance sheet accounts using the exchange rates in effect at the balance sheet date and for the revenue and expense accounts using appropriate average exchange rates for the respective periods. The gains or losses resulting from such translations are accumulated in a foreign currency translation reserve.

Premium or discount on forward contracts is amortised over the life of such contract and is recognized as income or expense in the Statement of Profit & Loss.

m. Investments

Investments are classified into current investments and long term investments.

Current investments are carried at lower of cost and market value. Any reduction in carrying amount and reversals of such reductions are charged or credited to the Statement of Profit and Loss.

Long term investments are stated at cost less provision for diminution in the value of such investments. Diminution in value is provided for where the management is of the opinion that the diminution is other than temporary in nature.

104 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION n. Impairment of Assets

At each balance sheet date, the Company reviews using internal resources the carrying amounts of its fixed assets to determine whether there is any indication that the assets suffered an impairment loss. If any such condition exists, the recoverable amount of the asset is estimated in order to determine the extent of impairment loss. Recoverable amount is the higher of an asset's net selling price and value in use. In assessing value in use, the estimated future cash flows expected from continuing use of the asset and from its disposal are discounted to their present value using a pre tax rate that reflects the current market assessments of time value of money and the risks specific to the asset.

Reversal of impairment loss is recognized immediately as income in the Statement of Profit & Loss. o. Inventories

Inventories are valued at lower of cost or net realizable value. Cost is ascertained on a moving weighted average basis. p. Employee Benefits

(i) Gratuity

The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees. The plan provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to 15 to 30 days salary payable for each completed year of service. Vesting occurs upon completion of five years of service. The Company makes annual contributions to gratuity fund established as trust. The Company accounts for the liability for gratuity benefits payable in future based on an independent actuarial valuationas on the Balance Sheet date.

(ii) Superannuation

The Company has two superannuation plans, a defined benefit plan and a defined contribution plan. An eligible employee on April 1, 1996 could elect to be member of either plan.

Employees who are the members of the defined benefit superannuation plan are entitled to benefits depending on the years of service and salary drawn. The monthly pension benefits after retirement range from 0.75% to 2% of the annual basic salary for each year of service. The Company and the said subsidiaries account for superannuation benefits payable in future under the plan based on an independent actuarial valuation as on the Balance Sheet date.

With effect from April 1, 2003, this plan was amended and benefits earned by covered employees have been protected as at March 31, 2003. Employees covered by this plan are prospectively entitled to benefits computed on a basis that ensures that the annual cost of providing the pension benefits would not exceed 15% of salary.

The Company maintains separate irrevocable trusts for employees covered and entitled to benefits. The Company contributes up to 15% of the eligible employees' salary to the trust every year. Such contributions are recognized as an expense when incurred. The Company has no further obligation beyond this contribution.

(iii) Bhavishya Kalyan Yojana (BKY)

Bhavishya Kalyan Yojana is an unfunded defined benefit plan. The benefits of the plan accrue to an eligible employee at the time of death or permanent disablement, while in service, either as a result of an injury or as certified by the appropriate authority. The monthly payment to dependents of the deceased /disabled employee under the plan equals 50% of the salary drawn at the time of death or accident or a specified amount, whichever is higher. The Company accounts for the liability for BKY benefits payable in future based on an independent actuarial valuation as on the Balance Sheet date

(iv) Post-retirement Medicare Scheme

Under this Scheme employees get medical benefits subject to certain limits of amount, periods after retirement and types of benefits, depending on their grade and location at the time of retirement. The Company account for the liability for post-retirement medical scheme based on an independent actuarial valuationas on the Balance Sheet date.

20th ANNUAL REPORT 2013 - 14 105 (v) Provident Fund

The eligible employees of the Company are entitled to receive benefits under the provident fund, a defined contribution plan, in which both employees and the company make monthly contributions at a specified percentage of the covered employees' salary (currently 12% of employees' salary). The provident fund contributions, as specified under the law, are paid to the provident fund set up as irrevocable trust by the Company and pension amount is paid to Regional Provident Fund Commissioner and the Central Provident Fund under the State Pension Scheme. The contributions paid during the year are charged to Statement of Profit & Loss.

(vi) Compensated absences

The Company provides for the encashment of leave or leave with pay subject to certain rules. The employees are entitled to accumulate leave subject to certain limits, for future encashment. The liability is provided based on number of days of unutilized leave at each balance sheet date based on an independent actuarial valuation as on the Balance Sheet date.

The subsidiaries of the company have no defined benefit schemes and the information mentioned above is with respect to Tata Technologies Limited on a standalone basis only.

q. Taxation

Current income tax expense comprises taxes on income from operations in India and foreign tax jurisdictions. Income tax payable in India is determined in accordance with the provisions of Income Tax Act, 1961. Tax expense relating to overseas operations is determined in accordance with tax laws applicable in countries where such operations are domiciled.

Deferred tax expense or benefit is recognized on timing differences being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets and liabilities are measured using the tax rates and the tax laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax assets in respect of unabsorbed depreciation and carry forward of losses are recognized to the extent that there is virtual certainty that taxable income will be available to realize these assets. All other deferred tax assets are recognized to the extent that there is reasonable certainty that future taxable income will be available to realize these assets.

r. Employee Stock Options

In accordance with the Employee Stock Option Scheme and Employee Stock Purchase Scheme Guidelines, 1999 issued by Securities and Exchange Board of India (SEBI), the Company introduced Employee Stock Option Plan 2001(TTESOP 2001) in 2000-01. As per the Plan, the options were granted at fair value as determined by an independent valuer as on the date of the grant and hence no compensation cost has been recognized.

s. Earnings per share

The earnings considered in ascertaining the Company's earnings per share comprise the net profit after tax and include the post-tax effect of any extra-ordinary items. The number of shares used in computing basic earnings per share, is the weighted average number of shares outstanding during the year. The number of shares used in computing diluted earnings per share comprises the shares considered for deriving basic earnings per share and also number of equity shares that could have been issued on the conversion of all dilutive potential equity shares.

t. Borrowing costs

Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalized as part of the cost of that asset. Borrowing costs are capitalized as part of the cost of a qualifying asset when it is probable that they will result in future economic benefits to the enterprise and the costs can be measured reliably. Other borrowing costs are recognized as an expense in the year in which they are incurred.

106 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION u. Provisions, contingent liabilities and contingent assets

A provision is recognized when the Company has present obligation as a result of past event and its probable that an outflow of resources will be required to settle the obligation, in respect of which reliable estimate can be made. The provisions (excluding retirement benefits) are not discounted to its present value and are determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect current best estimates. Contingent liabilities are not recognized in the financial statements. A contingent asset is neither recognized nor disclosed in the financial statements. v. Change in segment reporting

During the year, considering the evolution of the operations over the period based on offshore/onshore model, the management of the Company has changed the primary segment from 'geographic' segment until last year to 'business' segment in the current year. The change reflects the way management reviews and plans its business operations and allocates the resources. The segments have been identified taking into account the organization structure, as well as risk and returns associated.

20th ANNUAL REPORT 2013 - 14 107 Notes forming part of Consolidated Financial Statements

NOTE -3 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

SHARE CAPITAL

Authorised :

60,000,000 equity shares of ` 10/- each 60.00 60.00 (P.Y. 60,000,000 equity shares of ` 10/- each)

700,000 0.01% Cumulative Non-participative Compulsorily convertible Preference Shares of ` 10/- each 0.70 0.70 (P.Y. 700,000 0.01% Cumulative Non-participative Compulsorily convertible Preference Shares of ` 10/- each)

60.70 60.70

Issued, subscribed and fully paid :

43,024,138 equity shares of ` 10/- each (P.Y. 43,023,538 equity shares of ` 10/- each) 43.02 43.02

43.02 43.02

Note 3(i) Reconciliation of number of shares and amount outstanding at the beginning and at the end of the reporting periods : As at March 31, 2014 As at March 31, 2013 Particulars Amount in Amount in No. of Shares No. of Shares ` crore ` crore Equity shares

Number of shares as at April 1, 2013 43,023,538 43.02 42,970,138 42.97 Add: Shares issued under ESOP scheme 600 0.00 53,400 0.05

Number of shares as at March 31, 2014 43,024,138 43.02 43,023,538 43.02

Note 3(ii) Shares in the Company held by each shareholder holding more than 5 percent shares

As at March 31, 2014 As at March 31, 2013 Particulars % % No. of SharesHolding No. of Shares Holding Equity Shares

(a) Tata Motors Limited (Parent Company) 30,300,600 70.43 30,300,600 70.43 (b) Alpha TC Holdings Pte Ltd. 3,746,505 8.71 3,746,505 8.71 34,047,105 79.14 34,047,105 79.14

108 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Notes forming part of Consolidated Financial Statements

Note 3(iii) Equity shares of ` 10/- each allocated towards employee stock options granted/available for grant as at March 31, 2014 - 60,671 shares (61,271 shares as at March 31, 2013).

Note 3(iv)

Number of options granted, exercised and forfeited As at As at March 31, 2014 March 31, 2013

Options granted, beginning of the year 14,651 68,951 Exercised during the year (600) (53,400) Forfeited during the year - (900) Option granted, end of the year 14,051 14,651

Note 4

RESERVES AND SURPLUS (Amount in ` Crore)

As at As at Particulars March 31, Additions Deductions March 31, 2013 2014

(a) Securities Premium Account (Note 4 (i) & (v)) 350.50 - - 350.50 (b) Capital Reserve 0.63 - - 0.63 (c) Translation Reserves 22.04 105.86 - 127.90 (d) General Reserve (Note 4 (ii)) 69.83 21.00 - 90.83 (e) Legal Reserve (Note 4 (iii)) - 0.33 - 0.33 (f) Surplus i.e. balance in statement of Profit and Loss (Note 4 (iv)) 466.85 273.22 172.64 567.43 909.85 400.41 172.64 1,137.62

Note 4(i) Changes in Securities Premium Account (Amount in ` Crore)

2013-14 2012-13 Particulars Additions Deductions Additions Deductions

(a) Additions during the year - - 0.46 - (b) Capital Reduction adjustments during the year (Refer Note 4 (v)) - - 0.02 -

--0.48 -

Note 4(ii) Changes in General Reserve : (Amount in ` Crore)

2013-14 2012-13 Particulars Additions Deductions Additions Deductions

(a) Transferred from Statement of Profit and Loss 21.00 - 21.00 -

21.00 - 21.00 -

20th ANNUAL REPORT 2013 - 14 109 Notes forming part of Consolidated Financial Statements

Note 4(iii) Changes in Legal Reserve : (Amount in ` Crore)

2013-14 2012-13 Particulars Additions Deductions Additions Deductions

(a) Legal reserve on acquisition of Cambric Holdings Inc. 0.23 - - - (b) Transferred from current year retained earnings 0.10 - - - 0.33 - - -

Note 4(iv) Changes in Statement of Profit and Loss : (Amount in ` Crore)

2013-14 2012-13 Particulars Additions Deductions Additions Deductions

(a) Profit for the year 273.22 - 300.73 - (b) Final dividend - 77.44 - 68.84 (c) Interim dividend - 51.64 - 38.69 (d) Tax on final dividend - 13.69 - 11.17 (e) Tax on interim dividend - 8.77 - 6.28 (f) General reserve - 21.00 - 21.00 (g) Transferred to legal reserve - 0.10 - - 273.22 172.64 300.73 145.98

Note 4(v) During 2010, based on the approval of Shareholders of the Company at the Extra-Ordinary General Meeting held on March 5, 2010 and the Order of the Honourable High Court of Judicature at Mumbai dated April 16, 2010, the Company had utilized balance in the securities premium account to the tune of ` 46.66 Crore towards one time charges/cost (including change in accounting policy for provision for doubtful debts) incurred by the Company and its subsidiary companies. The amounts relating to the Company amounting to ` 17.32 Crore had been adjusted to the Securities Premium Account. An amount of ` 29.34 Crore equivalent to the total amount of adjustments relating to the subsidiaries had been identified and segregated from the balance in the Securities Premium Account for adjustment on consolidation. Of this total adjustment made, ` 1.58 Crore and ` 16.58 Crore related to provision for doubtful debts of the Company and its subsidiary companies respectively on account of change in accounting with regard to provision for doubtful debts.

During the year ended March 31, 2014, the Company and its subsidiary companies have received amounts aggregating to ` Nil (` 0.02 Crore for the year ended March 31, 2013) against the balances adjusted in the Securities Premium Account as above. Consequently, such excess provisions for doubtful debts on account of the said collections have been written back to the Securities Premium Account.

Since realisation of doubtful debts provided for the adjustments above upto March 31, 2014 amounted to ` 6.18 Crore relating to the subsidiaries, accordingly, balance amount of ` 23.16 Crore relating to the subsidiaries is continued to be disclosed seperately as Securities Premium Account for adjustment on consolidation.

110 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Notes forming part of Consolidated Financial Statements

Note 5 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013 LONG TERM BORROWINGS (A) Secured a) Banks (i) Vehicle loans [Secured by hypothecation of vehicles] ## - 0.04 (ii) Other Loans # - From Banks - Citi Bank 79.85 144.75 [Secured by hypothecation of Open ended debt Liquid, Liquid Plus, Short Term mutual funds (marketable and de-materialised form), including any dividend, redemption, deriving or accruing from any of the units and Trade Receivables]

b) Others Long term maturity of finance lease obligations (Refer Note 5 (i)) # 0.05 0.13 (Secured against fixed assets obtained under finance arrangements) (A) 79.90 144.92 Notes: # Terms of repayment - Equated Quarterly Installment ## Terms of repayment - Equated Monthly Installment

(B) Unsecured a) Banks (i) Term Loans - From Banks - Bank of America 119.78 - [Terms of repayment - 50% on April 30, 2015 and 50% on April 30, 2016] (B) 119.78 - 199.68 144.92

Note 5(i) Long term maturity of finance lease obligations

(Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

Total of Minimum lease payments Not later than one year 0.10 0.10 Later than one year and not later than five years 0.05 0.14 0.15 0.24

Less: Interest 0.01 0.03 0.14 0.21

Present Value of Minimum lease payments Not later than one year 0.09 0.08 Later than one year and not later than five years 0.05 0.13 0.14 0.21 The company has entered into finance lease arrangements for servers.

20th ANNUAL REPORT 2013 - 14 111 Notes forming part of Consolidated Financial Statements

Note 6 (Amount in `Crore)

As at As at Particulars March 31, 2014 March 31, 2013

DEFERRED TAX ASSETS / (LIABILITIES) (NET)

Tax effect of items constituting deferred tax liabilities : On difference between book balance and tax balance of fixed assets 8.99 9.64 Others 0.43 0.84 Sub-total 9.42 10.48 Deferred tax assets: Depreciation in excess of capital allowances 2.10 2.74 Provision for expenses disallowed under section 43B of The Income Tax Act, 1961 4.36 3.52 Others 13.86 6.49 Sub-total 20.32 12.75

Deferred Tax Asset (Net) 10.90 2.27

The Components of deferred tax assets (DTA) / deferred tax liabilities (DTL) referred above have been aggregated based on the nature of items across various tax jurisdictions. For the purpose of Balance Sheet disclosure such aggregation has not been made. The break up of the same is as follows:

Deferred tax liabilities (3.44) (4.56) Deferred tax assets 14.34 6.83 Deferred Tax Asset (Net) 10.90 2.27

Note 7 (Amount in `Crore) As at As at Particulars March 31, 2014 March 31, 2013

LONG - TERM PROVISIONS

Provision for employee benefits (Refer Note 7(i) & 7(ii)) 17.61 9.48 17.61 9.48

112 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Notes forming part of Consolidated Financial Statements 0.06 Crore) ` (Amount in BKY .31 0.24 0.16 0.09 0.10 0.12 0.14 0.12 0.09 0.06 0.12 0.14 0.12 0.09 0.06 0.06 .08 0.04 0.06 0.06 0.07 0.06 0.06 0.09 0.04 0.06 0.06 0.07 0.07 0.05 ------8 0.19 0.17 0.31 0.24 0.16 0.09 0.10 8 0.05 0.66 0.47 0.28 0.46 0.43 0.08 A N/A N/A N/A N/A N/A N/A N/A 0.17) (0.31) 0.37 0.02 (0.08) 0.21 0.28 (0.08) ------0.11 0.09 0.04 0.06 0.06 0.07 0.07 0.05 ------7) (0.12) (0.08) (0.04) (0.06) (0.06) (0.07) (0.06) (0.06) 7) (0.11) (0.09) (0.04) (0.06) (0.06) (0.07) (0.07) (0.05) 67 (0.17) (0.31) 0.37 0.02 (0.08) 0.21 0.28 (0.08) N/A N/A N/A N/A N/A N/A N/A N/A N/A ------One percentage point increase in One percentage point decrease Medical inflation rate Medical rate inflation in Medical rate inflation N/A 0.02 0.08 0.21 0.17 N/A (0.01) 0.07 0.18 0.16 N/A 0.03 0.16 0.18 0.13 N/A (0.03) 0.16 0.16 0.11 0.34 0.44 2.02 0.30 2.17 (0.30) (0.36) 1.93 0.28 1.93 2014 2013 2011 2010 2012 2014 2013 2010 2012 2011 0.82 4.21 3.60 2.74 1.97 2.01 2.04 2.13 1.72 1.50 1.11 0.74 1 4.93 2.74 1.97 2.01 2.04 1.42 1.72 1.50 1.11 0.74 0.72 4.14 4.21 3.61 2.74 1.97 2.01 2.04 2.13 1.72 1.50 1.11 0.74 (0.99) 0.13 0.19 (0.28) 0.17 (0.27) 0.26 0.06 0.01 (0.22) (0.30) 0.07 (4.92) (4.14) (4.21) (3.61) (2.74) (1.97) (2.01) (2.04) (2.13) (1.72) (1.50) (1.11) (0.74) 014 1.20 0.88 0.60 0.64 Compensated absencesCompensated Medicare scheme Post-retirement Gratuity Superannuation

20142012 2011 2013 2010 2014 2010 2013 2011 2010 2012 2011 2012 2013 2012 2010 2013 2014 2013 2011 2014 2010 2014 2012 2011 sheet Employer ServiceEmployer cost 2.71 2.30 2.25 1.34 1.16 0.25 0.25 0.24 0.20 0.26 1.52 0.69 0.11 0.08 0.19 0.17 0 Interest costInterest 1.77 1.52 1.16 0.92 0.89 0.39 0.37 0.35 0.33 0.33 0.36 0.35 0.29 0.28 0.35 0.22 0.16 0.17 0.17 Expected return on plan assetsExpected return (1.75) (1.66) (1.25) (0.88) (0.94) (0.49) (0.41) (0.41) (0.41) (0.39) ------Actuarial Losses/(Gains) 3.42 0.34 2.84 1.71 (0.02) 0.07 ( 0.78) 0.51 0.35 (0.16) 0.93 0.36 1.05 0.94 (0.17) 0.10 0.67 ( Total expense / (income) recognised in the expense Total Statement of Profit & Loss 6.15 2.50 5.00 3.09 1.09 0.22 (0.57) 0.69 0.47 0.04 2.81 1.91 2.22 1.82 1.01 0.94 0.0 Actual benefit payments 1.35 1.16 1.39 2.52 1.13 0.14 0.19 - 0.82 0.01 1.84 1.60 1.42 1.89 1.54 0.15 0.17 0.12 0 Actual Contributions (1.05) 1.77 9.91 - - 0.24 0.25 0.24 0.20 0.28 1.84 1.60 1.42 1.87 1.55 0.15 0.17 0.11 Present Value of Defined Benefit ObligationValue Present 27.94 21.89 18.44 14.37 12.12 6.40 5.85 5.61 5.17 5.32 6.19 5.22 4.92 Fair value of plan assets value Fair 21.94 23.11 20.38 11.40 12.24 6.67 6.11 5.05 5.06 5.47 ------Net asset/(liability) recognised in balance sheetNet asset/(liability) recognised (6.00) 1.22 1.94 (2.97) 0.12 0.27 0.26 (0.56) (0.11) 0.15 (6.19) (5.22) Experience adjustment on plan liabilities 1.58 (1.02) (2.54) (2.79) (2.44) 0.05 0.07 0.15 (0.15) 0.12 (0.80) (0.36) (1.12) Experience adjustment on plan assets 0.51 0.46 (0.78) 0.80 0.16 0.03 0.59 (0.67) (1.05) 0.04 ------Present Value of DBO at beginning of year of DBO at Value Present 21.89 18.44 14.37 12.12 11.06 5.85 5.61 5.17 5.31 4.87 5.23 4.92 4.14 4.2 Employer ServiceEmployer cost 2.71 2.30 2.25 1.34 1.16 0.25 0.25 0.24 0.20 0.26 1.52 1.20 0.88 0.60 0.64 0.69 0.11 0.0 Interest cost Interest 1.77 1.52 1.16 0.92 0.89 0.39 0.37 0.35 0.33 0.33 0.36 0.35 0.29 0.28 0.35 0.22 0.16 0.17 0.17 Actuarial (gains)/ losses 2.92 0.79 2.05 2.51 0.14 0.05 (0.19) (0.15) 0.15 (0.12) 0.93 0.36 1.03 0.94 (0.17) 0.10 0. Benefits paid (1.35) (1.16) (1.39) (2.52) (1.13) (0.14) (0.19) - (0.82) (0.01) (1.84) (1.60) (1.42) (1.89) (1.54) (0.15) (0.1 Present Value of DBO at the end of year of DBO at Value Present 27.94 21.89 18.44 14.37 12.12 6.40 5.85 5.61 5.17 5.32 6.20 5.23 4.92 4.14 Plan assets at beginning of yearPlan assets at 23.11 20.39 11.39 12.24 12.27 6.11 5.05 5.06 5.47 4.77 N/A N/A N/A N/A N/A N/A Actual return on plan assetsActual return 1.23 2.11 0.47 1.68 1.10 0.46 1.00 (0.25) 0.21 0.43 N/A N/A N/A N/A N/A N/A N/A N/ Actual Company contributionsActual Company (1.05) 1.77 9.91 - - 0.24 0.25 0.24 0.20 0.28 1.84 1.60 1.42 1.87 1.55 0.15 0.17 Benefits paid (1.35) (1.16) (1.39) (2.52) (1.13) (0.14) (0.19) - (0.82) (0.01) (1.84) (1.60) (1.42) (1.87) (1.55) (0.15) (0.1 Plan assets at the end of yearPlan assets at 21.94 23.11 20.38 11.40 12.24 6.67 6.11 5.05 5.06 5.47 ------Discount Rate 9.20% 8% 9% 9% 9% 6.75% 7% 7% 7% 7% 9.20% 8% 9% 9% 9% 9.20% 8% 9% 9% 9% 9.20% 8% 9% 9% 9% Expected Return on plan assets 8% 8% 8% 8% 8% 8% 8% 8% 8% 8% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Salary escalation 5-6.2% 4% 5% 2-5% 2-5% N/A N/A N/A N/A N/A 5-6.2% 4% 5% 2-5% 2-5% N/A N/A N/A N/A N/A 5-6.2% 4% 5% 2-5% 2-5% Medical cost inflation N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 6% 5% 4% 4% 4% N/A N/A N/A N/A N/A percentage of total plan assets Debt securities 98% 99% 74% 100% 100% 100% 100% 100% 100% 99% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Balances with banks 2% 1% 26% 0% 0% 0% 0% 0% 0% 1% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A assumed Medical rate inflation DBO as at 31 March DBO as at Service cost for the year Interest cost for the year Interest Note 7(i): as on March 31, 2 – as per actuarial to the company valuations absences relating Defined benefits plans / long term compensated i expense Components of employer ii Actual Contribution and Benefit Payments iii Net asset/(liability) recognised in balance iv Change in Defined Benefit Obligations (DBO) v of Assets Value Change in Fair vi Actuarial Assumptions vii The major categories of plan assets as viii Effect of one percentage point change in

20th ANNUAL REPORT 2013 - 14 113 Notes forming part of Consolidated Financial Statements

Note 7(ii) : Defined Contribution Plans- The Company's contribution to defined contribution plan for the year ended March 31, 2014 aggregated ` 23.15 crores (for the year ended March 31, 2013 ` 19.36 crores) has been recognised in the statement of Profit and Loss. Other benefits relating to the subsidiaries / JVs: Compensated Absences and Gratuity - Charged to Statement of Profit & Loss for the year ended March 31, 2014 ` 1.17 Crore (for the year ended March 31, 2013 ` 0.38 Crore) Lliabilities outstanding as at March 31, 2014 ` 6.31 Crore (as at March 31, 2013 ` 3.17 crore) Notes : (a) The expected rate of return on plan assets is based on market expectation, at the beginning of the year, for returns over the entire life of the related obligation. (b) The assumption of future salary increases, considered in actuarial valuation, takes into account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market. (c) Also refer note 2(k) for brief description of employee benefit schemes. Note 8 SHORT TERM BORROWINGS FROM BANKS (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

(A) Secured Loans repayable on demand (Refer Note (i)) 33.69 24.89 33.69 24.89 Note (i) (a) The loan of USD 5,500,000/- (P.Y. USD 4,500,000) taken from Chase Commercial Bank. 32.94 24.42 The same is repayable on call basis.The loan carries interest rate at Libor+1.75%. [Secured by hypothecation of book debts/accounts receivable and movable fixed assets (excluding certain vehicle)] (b) Overdraft Facility provided by YES Bank (P.Y. HDFC Bank). The same is repayable on call 0.75 0.47 basis. The loan carries interest rate at 12.50%. [Secured by hypothecation of stocks and book debts]

(B) Unsecured Loans repayable on demand 97.32 54.28 131.01 79.17

Note 9 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

OTHER CURRENT LIABILITIES

(a) Interest accrued but not due on borrowings 0.18 0.39 (b) Current maturities of long term debt (Refer Note 5) 79.88 72.75 (c) Current maturities of finance lease obligations (Refer Note 5(i)) 0.08 0.08 (d) Unpaid dividends 1.03 0.79 (e) Income received in advance 50.56 54.96 (f) Statutory dues 57.33 23.74 (g) Advance and progress payments 3.08 4.29 192.14 157.00 Note 10 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013 SHORT-TERM PROVISIONS

(a) Provision for Employee benefits (Refer Note 7(i) & 7(ii)) 6.63 3.38 (b) Provision for Final Dividend 77.44 68.84 (c) Provision for Tax on Dividend 13.16 11.17 97.23 83.39

114 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Notes forming part of Consolidated Financial Statements Note 11

(Amount in ` Crore) Accumulated Additions Accumulated depreciation Depreciation Accumulated Net Book Net Book on account Cost as at Cost as at depreciation on for the year depreciation Value Value FIXED ASSETS of acquisition Additions Deductions Translation Deductions Translation Apr 1, 2013 Mar 31, 2014 up to acquisition ended up to as at as at of Cambric Adjustments Adjustments April 1, 2013 of Cambric Mar 31, 2014 Mar 31, 2014 Mar 31, 2014 Mar 31, 2013 Holding Inc. Holding Inc.

[A] TANGIBLE ASSETS (a) Leasehold Land 4.09 - - - - 4.09 0.53 - 0.04 - - 0.57 3.52 3.56 (4.09) (-) (-) (-) (-) (4.09) (0.49) (-) (0.04) (-) (-) (0.53) (3.56) (3.60)

(b) Buildings 22.79 - 0.04 - - 22.83 7.56 - 0.95 - - 8.51 14.32 15.23 (22.79) (-) (-) (-) (-) (22.79) (6.61) (-) (0.95) (-) (-) (7.56) (15.23) (16.18)

(c) Plant & Machinery and Equipments - Owned 17.26 - 2.60 0.17 - 19.69 5.89 - 1.32 0.10 - 7.11 12.58 11.37 (16.37) (-) (0.94) (0.05) (-) (17.26) (4.89) (-) (1.03) (0.03) (-) (5.89) (11.37) (11.48)

(d) Plant & Machinery and Equipments - Leased 0.50 - - - 0.02 0.52 0.32 - 0.11 - 0.02 0.45 0.07 0.18 (0.60) (-) (-) (0.10) (-) (0.50) (0.31) (-) (0.11) (0.10) (-) (0.32) (0.18) (0.29)

(e) Computers 75.40 8.66 23.45 7.28 3.73 103.96 54.08 6.74 15.28 7.22 2.98 71.86 32.10 21.32 (81.26) (-) (9.27) (16.29) (1.16) (75.40) (60.10) (-) (9.31) (16.28) (0.95) (54.08) (21.32) (21.16)

(f) Furniture and fixtures 18.05 2.45 3.41 1.43 1.21 23.69 9.17 2.16 1.88 1.28 0.97 12.90 10.79 8.88 (19.06) (-) (2.56) (3.78) (0.21) (18.05) (11.42) (-) (1.32) (3.74) (0.17) (9.17) (8.88) (7.64)

(g) Vehicles (Refer Note 11 (i)) 4.31 0.08 0.90 2.00 0.18 3.47 2.18 0.03 0.99 1.76 0.06 1.50 1.97 2.13 (4.24) (-) (0.17) (0.15) (0.05) (4.31) (1.36) (-) (0.96) (0.15) (0.01) (2.18) (2.13) (2.88)

20th ANNUAL REPORT 2013- 14 (h) Leasehold Improvements 12.30 1.47 4.51 - 0.74 19.02 5.25 0.79 2.43 - 0.50 8.97 10.05 7.05 (11.85) (-) (1.62) (1.38) (0.21) (12.30) (4.93) (-) (1.63) (1.38) (0.07) (5.25) (7.05) (6.92)

Total 154.70 12.66 34.91 10.88 5.88 197.27 84.98 9.72 23.00 10.36 4.53 111.87 85.40 69.72

(160.26) (-) (14.56) (21.75) (1.63) (154.70) (90.11) (-) (15.35) (21.68) (1.20) (84.98) (69.72)

Notes : i) Vehicles includes gross block as at March 31, 2014 `` 0.37 Crore (W.D.V. 0.03 Crore) acquired on loan, hypothecated with Tata Capital Ltd, Tata Finance Ltd, Tata Motors Finance Limited and ICICI Bank Ltd (as at March 31, 2013 ` 1.64 Crore) (W.D.V ` 0.47 Crore)) ii) Capital Commitment : The estimated amount of contracts remaining to be executed on capital account, and not provided for is ` 11.75 Crore as at March 31, ` 115 2014 (as at March 31, 2013 9.49 Crore). iii) Previous year's figures are shown in the brackets 116 Notes forming part of Consolidated Financial Statements

BUSINESS TRANSFORMATION NAVIGATION THROUGH BETTER Note 12 (Amount in ` Crore)

Accumulated Additions Accumulated amortization Amortization Accumulated Net Book Net Book on account Cost as at Cost as at amortization on for the year amortization Value Value FIXED ASSETS of acquisition Additions Deductions Translation Deductions Translation Apr 1, 2013 Mar 31, 2014 up to acquisition ended up to as at as at of Cambric Adjustments Adjustments April 1, 2013 of Cambric Mar 31, 2014 Mar 31, 2014 Mar 31, 2014 Mar 31, 2013 Holding Inc. Holding Inc.

[B] INTANGIBLE ASSETS (Other than internally generated)

(a) Copyrights 0.54 - 0.22 - 0.05 0.81 0.05 - 0.06 - - 0.11 0.70 0.49 (0.21) (-) (0.32) (-) (0.01) (0.54) (0.03) (-) (0.02) (-) (-) (0.05) (0.49) (0.18)

(b) Software Licenses 101.05 20.91 24.09 8.37 2.43 140.11 62.30 14.02 25.05 8.37 2.10 95.10 45.01 38.75 (89.04) (-) (19.88) (8.84) (0.97) (101.05) (52.61) (-) (17.72) (8.84) (0.81) (62.30) (38.75) (36.43)

Total 101.59 20.91 24.31 8.37 2.48 140.92 62.35 14.02 25.11 8.37 2.10 95.21 45.71 39.24

(89.25) (-) (20.20) (8.84) (0.98) (101.59) (52.64) (-) (17.74) (8.84) (0.81) (62.35) (39.24)

Notes : (i) Capital Commitment : The estimated amount of contracts remaining to be executed on capital account, and not provided for is ` 2.51 Crore as at March 31, 2014 (as at March 31, 2013 : ` 8.59 Crore). (ii) Previous year's figures are shown in the brackets Notes forming part of Consolidated Financial Statements

Note 13 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013 NON-CURRENT INVESTMENTS (NON TRADE) Other Investments (Quoted) * i) Investment in Debentures Tata Motors Finance Limited 5.00 5.00 100 (P.Y. 100) 11% Non Convertible Debentures of ` 0.05 Crore each fully paid

ii) Investments in Mutual Funds Tata FMP - Series 42 Scheme H - Direct - Growth - 2.00 BNP Paribas Fixed Term Fund Series - 24A - Direct - Growth - 3.00 DWS Fixed Maturity Plan - Series 26 - Direct - Growth - 2.50 JP Morgan Fixed Maturity Plan Sr. 16 - Direct Growth - 5.00 * (Note: Market value of quoted investments ` 5.18 Crore ( P.Y. ` 17.52 Crore)

Other Investments (Unquoted) i) Investment in Preference Shares Tata Capital Limited - 33,333 (P.Y. 33,333) Cumulative redeemable non participating Preference shares of ` 1,500 each fully paid 5.00 5.00

10.00 22.50

Note 14 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013 LONG - TERM LOANS AND ADVANCES Unsecured (Considered good) (a) Security deposits 1.32 3.07 (b) Loans to employees # 3.32 2.30 (c) Loans to others 33.28 16.11 (d) Capital advances 0.32 0.05 (e) Prepaid expenses 0.54 1.66 (f) Deposits with government and others 1.64 1.17 40.42 24.36

# Note : Includes amount given to Director and other officers ` 0.77 Crore (P.Y. ` 0.77 Crore)

20th ANNUAL REPORT 2013 - 14 117 Notes forming part of Consolidated Financial Statements

Note 15 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

CURRENT INVESTMENTS - OTHERS a) Investments in Mutual Funds (Unquoted) Baroda Pioneer Dynamic Bond Fund - Dividend Plan Payout - 20.00 Religare Invesco Short Term Plan - Plan A Weekly Dividend - Reinvestment - 26.20 Taurus Short Term Income Fund - Monthly Dividend Reinvestment - 5.15 Religare Invesco Bank Debt Fund - 10.13 Axis Banking Debt Fund - Direct - Daily Dividend Reinvestment - 10.10 HDFC Floating Rate Income Fund - Short Term - Weekly Payout - Direct - Daily Dividend Reinvestment - 5.02 Morgan Stanley Short Term Bond Fund - Direct - Weekly Dividend Reinvestment - 20.45 SBI Magnum Insta Cash - Liquid Floater - Direct - Daily Dividend Reinvestment - 7.53 BNP Paribas Short Term Income Fund - Direct - Monthly Dividend Payout - 15.05 DWS Treasury Fund - Investment - Direct - Growth - 5.76 Morgan Stanley Liquid Fund - Direct - Growth - 20.05 Religare Invesco Credit Opportunities Fund - Direct - Growth - 28.02 Baroda Pioneer Liquid Fund - Plan B - Direct - Growth - 21.00 Sundaram Ultra Short Term Fund - Direct - Growth - 30.00 Birla Sun Life Cash Plus - Direct - Growth 25.00 - SBI Premier Liquid Fund - Direct - Daily Dividend Reinvestment 5.93 - IDFC Cash Fund - Direct - Daily Dividend Reinvestment 7.62 - Reliance Liquid Fund Treasury Plan- Direct - Daily Dividend Reinvestment 25.13 - ICICI Prudential Liquid Direct Plan Daily Dividend Reinvestment 18.29 - Birla Sun Life Cash Plus Direct Daily Dividend Reinvestment 25.91 - Tata Liquid Fund-Direct- Daily Dividend Reinvestment 10.72 - HDFC Liquid Fund Direct Daily Dividend Reinvestment 18.22 - Kotak Liquid Plan A - Direct - Daily Dividend Reinvestment 8.61 - L & T Liquid Fund - Direct - Daily Dividend Reinvestment 13.76 - UTI Liquid Fund - Cash Plan - Direct - Daily Dividend Reinvestment 13.66 - HDFC Cash Mgmt Savings Plan - Direct - Growth 15.00 - Reliance Liquidity Fund - Direct - Growth 20.00 - Tata Liquid Fund - Direct - Growth 36.75 - Birla Sun Life Folating Rate Fund - Short Term Plan - Direct - Growth 50.00 - HDFC Liquid Fund - Direct - Growth 10.00 - ICICI Prudential Liquid - Direct - Growth 30.00 - IDFC Cash Fund - Direct - Growth 7.80 - L & T Liquid Fund - Direct - Growth 16.00 - SBI Premier Liquid Fund - Direct - Growth 10.00 - DSP BlackRock Liquidity Fund - Direct Plan - Growth 7.00 - Kotak Liquid Scheme Plan A - Direct - Growth 15.00 - Reliance Liquid Fund Treasury Plan Direct Growth 25.00 - 415.40 224.46 b) Investments in Mutual Funds (Quoted) * Birla Sun Life Fixed Term Plan Series DU - Growth - 2.00 JP Morgan India Fixed Maturity Plan Series 6 - Growth - 4.00 ICICI Prudential Fixed Maturity Plan Series-62-396D-Plan F-Growth - 2.50 Birla Fixed Term Fund- Series ES-Growth - 2.00 HDFC Fixed Maturity Plan 400D February 2012 (1) -Growth - 2.50 Axis Fixed Term Plan - Series 21 - Growth - 2.50 Tata Fixed Maturity Plan Series 39 -Scheme G - Growth - 2.50 ICICI Prudential Fixed Maturity Plan - Series 63 - Plan A - Growth - 5.00 BSL Fixed Term Plan - Series EV - Growth - 5.00 Kotak Fixed Maturity Plan - Series 80 - Growth - 5.00 Reliance Fixed Horizon Fund - Series XXI - Series 18 - Growth - 5.00 Reliance Yearly Interval Fund - Series 1 - Direct - Growth 5.00 - Tata Fixed Maturity Plan - Series 42 Scheme H - Direct Plan - Growth 2.00 - BNP Paribas Fixed Term Fund Series - 24A - Direct - Growth 3.00 - DWS Fixed Maturity Plan - Series 26 - Direct - Growth 2.50 - JP Morgan Fixed Maturity Plan Series 16 - Direct Growth 5.00 - Birla Sun Life Fixed Term Plan - Series JY (367 Days) Direct - Growth 5.00 - Birla Sun Life Fixed Term Plan - Series JZ (368 Days) Direct - Growth 3.00 - DSP BlackRock Fixed Maturity Plan - Series 144 -12M - Direct - Growth 5.00 - Reliance Fixed Horizon Fund-XXV- Series 18- Direct - Growth 3.00 - Tata Fixed Maturity Plan Series 46 L - Direct - Growth 5.00 - ICICI Prudential Fixed Maturity Plan Series 72 - 366 Days - Plan K - Direct - Growth 5.00 - Birla Sun Life Fixed Term Plan - Series KC (368 Days) Direct - Growth 2.00 - HDFC Fixed Maturity Plan 370D February 2014 (1) - Series 29 - Direct - Growth 4.00 - ICICI Prudential Fixed Maturity Plan Series 72 - 366 Days - Plan M - Direct - Growth 4.00 - JP Morgan Fixed Maturity Plan Series 31 - Direct - Growth 7.00 - Kotak Fixed Maturity Plan Series 137 - Direct - Growth 2.00 - IDFC Fixed Maturity Plan Series 76 (366 Days) - Direct - Growth 2.00 - Kotak Fixed Maturity Plan Series 143 - Direct - Growth 3.00 - L & T Fixed Maturity Plan Series 10 - Plan N - Direct - Growth 5.00 - DSP BlackRock Fixed Maturity Plan - Series 151 - 12 M - Direct - Growth 5.00 - * (Note: Market value of quoted investments ` 79.72 Crore ( P.Y. ` 42.19 Crore)) 77.50 38.00 492.90 262.46

118 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Notes forming part of Consolidated Financial Statements

Note 16 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

TRADE RECEIVABLES (Unsecured, considered good unless otherwise stated) (a) Trade receivables due for a period exceeding six months Considered good 1.72 1.57 Considered doubtful 10.05 15.79 11.77 17.36 Less : Allowances for doubtful debts 10.05 15.79 1.72 1.57 (b) Other trade receivables Considered good 305.29 314.14 Considered doubtful 0.63 0.18 305.92 314.32 Less : Allowances for doubtful debts 0.63 0.18 305.29 314.14

307.01 315.71

Note 17 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

CASH AND BANK BALANCES (A) Cash and cash equivalents (a) Cash on hand 0.04 0.03 (b) Cheques, drafts on hand / funds in transit (Refer Note 17 (ii)) 36.74 23.14 (c) Current account with banks (Refer Note 17 (i)) 414.31 209.39 (d) Pledged/lien with banks - 0.02 (e) Bank deposits less than 3 months maturity 9.35 64.94 460.44 297.52 (B) Other bank balances (with more than 3 months but less than 12 months maturity)

(a) Earmarked balance with banks 1.04 0.80 (b) Bank deposits 3.63 7.78 (c) Pledged/lien with banks 0.27 0.04 4.94 8.62 (C) Other bank balances (with more than 12 months maturity) (a) Pledged/lien with banks 0.03 0.01 (b) Bank deposits 0.04 - 0.07 0.01

465.45 306.15 Notes: (i) In foreign currencies 409.38 207.58 (ii) Remittances in transit 22.62 -

20th ANNUAL REPORT 2013 - 14 119 Notes forming part of Consolidated Financial Statements

Note 18 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

OTHER CURRENT ASSETS (a) Interest accrued on deposits and investments 0.30 0.30 (b) Unbilled revenue 24.94 33.70 (c) Advances to suppliers and contractors 22.80 16.39 (d) Prepaid expenses 24.72 26.64 (e) Unamortized premium on forward contract - 0.03 (f) Others (VAT, Service tax, other taxes recoverables etc.) 1.14 3.22 73.90 80.28

Note 19 (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

SHORT TERM LOANS AND ADVANCES Unsecured (considered good, unless otherwise stated) (a) Inter corporate deposits (Refer Note 27(iv) (b)) - 183.90 (b) Loans and advances to related parties (Refer Note 27 (iv) (b)) 1.50 1.22 (c) Security deposits 2.69 0.51 (d) Loans and advances employees 2.60 3.92 (Includes amount given to managing director ` Nil (P.Y. ` 0.62 Crore)) Less : Allowances for doubtful loans and advances (0.04) (0.04) (e) Deposits with government and others 0.19 0.07 6.94 189.58

Note 20 (Amount in ` Crore)

Particulars Year ended Year ended March 31, 2014 March 31, 2013

REVENUE FROM OPERATIONS (a) Sale of products 542.35 476.39 (b) Sale of services 1,799.21 1,511.64 (c) Commission income 2.89 6.97 2,344.45 1,995.00

Note 21 (Amount in ` Crore)

Particulars Year ended Year ended March 31, 2014 March 31, 2013

OTHER INCOME (a) Interest income-others 13.85 10.80 (b) Interest income-Long term investments 0.55 0.58 (c) Dividend income - Other current investments 13.67 14.33 (d) Dividend income - Non current investments 0.18 - (e) Foreign currency gain (Net) 1.08 3.26 (f) Doubtful debts written back 6.99 1.19 (g) Profit on sale of investments (Net) 4.74 3.92 (h) Other non-operating income* 9.22 16.34 50.28 50.42 * Other non-operating income includes provisions no longer required, written back 7.31 13.37

120 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Notes forming part of Consolidated Financial Statements

Note 22 (Amount in ` Crore)

Particulars Year ended Year ended March 31, 2014 March 31, 2013

COST OF TRADED PRODUCTS (a) Purchase of products 402.17 349.41 (b) (Increase)/Decrease in stock in trade 0.06 (0.01) 402.23 349.40

Note 23 (Amount in ` Crore)

Particulars Year ended Year ended March 31, 2014 March 31, 2013

CONSULTANCY FEES, SOFTWARES AND OTHERS (a) Outsourcing charges 306.29 242.15 (b) Software-internal use 8.32 5.35 (c) Professional fees 52.44 33.50 (d) Training costs 0.42 0.25 367.47 281.25

Note 24 (Amount in ` Crore)

Particulars Year ended Year ended March 31, 2014 March 31, 2013

EMPLOYEE BENEFIT EXPENSE (a) Salaries and wages 1,004.44 812.97 (b) Contribution to provident fund 12.67 11.29 (c) Contribution to superannuation scheme 4.60 3.20 (d) Contribution to gratuity fund 6.17 2.52 (e) Social security and other benefit plans for overseas employees 6.01 4.17 (f) Staff welfare expenses 21.32 13.75 1,055.21 847.90

Note 25 (Amount in ` Crore)

Particulars Year ended Year ended March 31, 2014 March 31, 2013

FINANCE COSTS Interest Expense (a) Interest on short term borrowings 7.62 7.53 (b) Interest on long term borrowings 0.04 0.09 7.66 7.62

20th ANNUAL REPORT 2013 - 14 121 Notes forming part of Consolidated Financial Statements

Note 26 (Amount in ` Crore)

Particulars Year ended Year ended March 31, 2014 March 31, 2013

OTHER EXPENSES (a) Repairs & maintenance -Buildings 4.60 3.80 - Plant & machinery 0.70 1.24 - Others 3.99 3.33 (b) Rent* 28.88 16.19 (c) Rates and taxes 2.58 2.10 (d) Provision for wealth tax 0.01 0.01 (e) Insurance 4.53 2.92 (f) Overseas marketing expenses 1.73 1.78 (g) Advertisement and publicity 0.42 0.29 (h) Business promotion expenses 2.78 1.07 (i) Office expenses 10.25 9.53 (j) Travelling & conveyance 47.49 42.74 (k) Power & fuel 4.77 4.17 (l) Water charges 2.05 0.81 (m) Auditors remuneration** 2.09 1.87 (n) Staff training and seminar expenses 4.07 4.53 (o) Staff recruitment expenses 4.26 4.85 (p) Commision to others - 0.47 (q) AMC charges 16.98 9.94 (r) Communication expenses 16.47 15.01 (s) Bad debts written off 11.94 1.46 (t) Miscellaneous expenses 5.89 5.62 176.48 133.73

*Obligations under operating lease (Amount in ` Crore) Year ended Year ended Particulars March 31, 2014 March 31, 2013

Lease Obligations Dues not later than one year 22.10 18.66 Due later than one year but not later than five years 19.04 24.61 Later than five years 1.13 - 42.27 43.27 Lease payments recognised in the statement of profit and loss for the year 28.88 16.19

The Company has entered into operating lease arrangements for office premises.

122 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Additional information to the Consolidated Financial Statements

**Auditors' Remuneration (Excluding Service tax) (Amount in ` Crore)

Particulars Year ended Year ended March 31, 2014 March 31, 2013

For Holding Company i) For services as auditors, including quarterly audits 0.35 0.30 ii) For Tax audit/Transfer pricing audit 0.04 0.24 iii) For other attest services 0.05 0.01 iv) Reimbursement of out-of-pocket expenses 0.02 0.01 Sub-Total 0.46 0.56 For Subsidiaries & Joint venture i) For services as auditors, including quarterly audits 1.43 1.18 ii) For Tax audit/Transfer pricing audit 0.07 0.11 iii) For other attest services 0.13 0.01 iv) Reimbursement of out-of-pocket expenses 0.00 0.01 Sub-Total 1.63 1.31

Total 2.09 1.87

Note 27 (i): Earnings per Share (Amount in ` Crore) Year ended Year ended Particulars March 31, 2014 March 31, 2013

(a) Profit after tax` Crore 273.22 300.73 (b) The weighted average number of Ordinary Shares for Basic EPS Nos. 43,024,138 43,023,538 (c) The nominal value per Ordinary Share ` 10.00 10.00 (d) Earnings Per Share (Basic) ` 63.51 69.90 (e) Profit after tax for Diluted EPS` Crore 273.22 300.73 (f) The weighted average number of Ordinary Shares for Basic EPS Nos. 43,024,138 43,023,538 (g) Add: Adjustment for Employee Stock Options (Refer Note 3 (iii)) Nos. 14,051 14,651 (h) The weighted average number of Ordinary Shares for Diluted EPS Nos. 43,038,189 43,038,189 (i) Earnings Per Shares (Diluted) ` 63.48 69.88

Note 27 (ii): Contingent Liabilities (Amount in ` Crore)

As at As at Particulars March 31, 2014 March 31, 2013

(a) Bills discounted 113.61 66.69 (b) Income Tax demands disputed in appeals 2.11 2.00 (c) Sales Tax demands disputed in appeals 21.83 21.81 (d) Service Tax demands disputed in appeals 8.67 7.72

20th ANNUAL REPORT 2013 - 14 123 Additional information to the Consolidated Financial Statements

Note 27 (iii): Movement in Goodwill

(a) Goodwill on consolidation (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

As at the beginning of the year 404.60 397.90 Translation difference 85.38 6.70 As at the end of the year 489.98 404.60

(b) Goodwill on acquisition (Refer Note 27 (vi)) (Amount in ` Crore) As at As at Particulars March 31, 2014 March 31, 2013

As at the beginning of the year - - Additions on acquisition of Cambric Holding Inc. 139.60 - Translation difference 15.77 - As at the end of the year 155.37 -

Note 27 (iv) Segment Reporting

Primary Segment - Business The Company's operations entail providing 'Information Technology Products and Services' which constitute a single segment for primary segment reporting. Accordingly, the figures given in these financial statements relate to the Company's single business segment.

Secondary Segment - Geographic Secondary segmental reporting is prepared on the basis of geographical location of the customers. (Amount in ` Crore) Rest of Particulars India UK USA Rest of the Total Europe World Revenues 823.39 663.97 629.90 173.86 53.33 2,344.45 680.46 576.55 557.63 146.33 34.03 1,995.00 Identifiable operating expenses 584.37 607.67 425.61 145.90 34.82 1,798.37 464.91 497.46 346.54 116.30 18.51 1,443.72 Allocated expenses 66.28 6.96 24.92 26.23 7.59 131.98 47.58 6.25 19.35 27.38 5.49 106.05 Segmental operating income 172.74 49.35 179.37 1.73 10.91 414.10 167.97 72.84 191.74 2.65 10.03 445.23 Unallocable expenses 117.35 95.62 Other Income 40.82 42.82 Net profit before taxes 337.57 392.43 Income taxes 64.35 91.70 Net profit after taxes 273.22 300.73

Fixed assets used in the Company's business or liabilities contracted have not been identified to any of the reported segments, as fixed assets and services are used interchangeably between reported segments.

Figures for comparative period have been presented in accordance with the reporting in the current period. There has been no financial impact due to change in segment reporting in the current year.

Previous year figures are shown in italic.

124 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Additional information to the Consolidated Financial Statements

Note 27 (v) Related Party Disclosures for the year ended March 31, 2014 a) Related party and their relationship

1 Parent Company Tata Motors Limited

2 Fellow subsidiaries 1 TAL Manufacturing Solutions Ltd. 2 TML Driveline Ltd. 3 Sheba Properties Ltd. 4 Concorde Motors (India) Ltd. 5 Tata Daewoo Commercial Vehicle Co.Ltd. 6 Tata Motors Insurance Broking & Advisory Services Ltd. 7 Tata Motors European Technical Centre Plc. 8 Tata Motors Finance Limited 9 Tata Marcopolo Motors Ltd. 10 Tata Motors (Thailand) Ltd. 11 TML Holdings Pte Ltd. 12 TML Distribution Company Limited 13 Tata Hispano Motors Carrocera S.A. 14 PT Tata Motors Indonesia 15 Tata Motors (SA) (Proprietary) Limited 16 Jaguar Land Rover Automotive PLC (Erstwhile Jaguar Land Rover PLC name changed w.e.f. 28.12.2012 and the name changed from Jaguar Land Rover Limited on 06.04.11) 17 Jaguar Land Rover Limited (JLR Ltd. acquired business and assets of Jaguar Land Rover Exports Ltd. on 1.4.2013 (other than its nominee shareholdings in Jaguar Land Rover Portugal, Jaguar Land Rover Brasil, Land Rover Belux S.A./N.V., Jaguar Belux N.V and membership in British Motor Industry Heritage Trust)) 18 Jaguar Land Rover Austria GmbH 19 Jaguar Land Rover Japan Ltd. 20 JLR Nominee Company Limited (Business of Land Rover Exports Limited transferred w.e.f. 1.4.2012 to Jaguar Land Rover Exports Ltd. And name changed from Jaguar Land Rover Exports Ltd w.e.f. 1.7.2013) 21 Jaguar Cars South Africa (pty) Ltd 22 The Daimler Motor Company Ltd 23 The Jaguar Collection Ltd 24 Daimler Transport Vehicles Ltd 25 S.S. Cars Ltd 26 The Lanchester Motor Company Ltd 27 Jaguar Land Rover Deutschland GmbH 28 Land Rover Group Ltd 29 Jaguar Land Rover North America LLC 30 Jaguar Land Rover Belux (Land Rover Belux S.A./N.V merged with Jaguar Belux N.V. w.e.f. October 1, 2013 and name changed from Jaguar Belux to Jaguar Land Rover Belux w.e.f. November 12, 2013) 31 Land Rover Ireland Ltd 32 Jaguar Land Rover Nederland BV 33 Jaguar Land Rover Portugal - Veiculos e Pecas LDA 34 Jaguar Land Rover Australia Pty Ltd. 35 Jaguar Land Rover Italia SpA 36 Jaguar Land Rover Espana SL (Jaguar Hispania SL was absorbed into Land Rover Eispana SL w.e.f. January 1, 2013 and the name was changed to Jaguar Land Rover Espana SL)

20th ANNUAL REPORT 2013 - 14 125 Additional information to the Consolidated Financial Statements

37 Jaguar Land Rover Korea Company Ltd 38 Jaguar Land Rover Automotive Trading (Shanghai) Company Ltd. 39 Jaguar Land Rover Canada ULC 40 Jaguar Land Rover France, SAS 41 Jaguar Land Rover (South Africa) (Pty) Ltd. 42 Jaguar e Land Rover Brasil Importacao e Comercia de Veiculos Ltda 43 Limited Liability Company "Jaguar Land Rover" (Russia) 44 Land Rover Parts Limited 45 Jaguar Land Rover (South Africa) Holdings Ltd. 46 Land Rover Exports Limited (Business transferred to Jaguar Land Rover Exports Limited on 1.4.2012) 47 Jaguar Land Rover India Limited (incorporated w.e.f October 25, 2012) 48 Jaguar Cars Limited 49 Tata Hispano Motors Carrocera S.A. 50 Tata Hispano Motors Carrocerries Maghreb S.A. 51 Tata Daewoo Commercial Vehicle Sales and Distribution Co. Ltd. 52 Tata Precision Industries Pte. Ltd. 53 Trilix S.r.l. 54 PT Tata Motors Distribusi Indonesia (Incorporated w.e.f February 11, 2013) 55 Jaguar Land Rover Holdings Ltd. ( all business and assets of Land Rover were acquired by Jaguar Land Rover Ltd. Except Jaguar Land Rover Automotive Trading (Shangai) Company Ltd. On January 1, 2013 and name changed from Land Rover w.e.f. October 4, 2013)

3 Joint Venture TATA HAL Technologies Limited

4 Associates and Joint Venture 1 Tata Cummins Ltd of Parent Company 2 Tata Precision Industries (India) Ltd. 3 Fiat India Automobiles Ltd. 4 Spark44 (JV) Ltd. 5 Jaguar Cars Finance Ltd. 6 Automobile Corporation of Goa Ltd 7 Nita Co Ltd 8 Cherry Jaguar Land Rover Automotive Co. Limited 9 Tata Hitachi Construction Machinery Company Limited (Erstwhile Telco Construction Equipment Co.Ltd. name changed w.e.f November 23, 2012) 10 Tata AutoComp Systems Ltd 11 Suzhou Chery Jaguar Land Rover Trading Co. Ltd (Interim JV)

5 Key Management Personnel Mr. P. R. McGoldrick

6 Key Management Personnel 1 Mr. Warren K Harris in subsidiary companies & 2 Mr. Fernando Oviedo Joint Venture 3 Mr. Nick Sale 4 Mr. Ramesh Indhewat 5 Mr. Lokesh Shrivastava 6 Mr. Timothy Hayes

126 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Additional information to the Consolidated Financial Statements

Note 27 (v) Related Party Disclosures for the year ended March 31, 2014. b) Transactions with related parties (Amount in ` Crore) Key Parent Fellow Joint Particulars Management Total Company subsidiaries Venture Personnel** Sale of products 39.56 2.29 1.64 - 43.49 (44.71) (3.26) (0.49) (-) (48.46)

Services received - 8.22 0.56 - 8.78 (-) (6.85) (0.02) (-) (6.87)

Services rendered 439.35 736.40 - - 1,175.75 (387.39) (614.76) (-) (-) (1,002.15)

Finance placed (including loans, equity & ICD) 926.60 - - - 926.60 (817.65) (-) (0.38) (-) (818.03)

Finance received back (including loans,equity & ICD) 1,110.50 - - - 1,110.50 (635.75) (20.01) (-) (-) (655.76)

Dividend paid 84.84 - - - 84.84 (48.48) (-) (-) (-) (48.48)

Interest paid / (received)(net) (11.62) (0.55) - - (12.17) (-5.37) (-0.60) (-) (-) (-5.97)

Remuneration - - - 12.67 12.67 (-) (-) (-) (10.15) (10.15)

Amount receivable 31.47 144.27 0.16 - 175.90 (38.04) (114.37) (0.06) (-) (152.47)

Amount payable 2.10 8.51 0.56 1.43 12.60 (0.62) (3.32) (-) (0.20) (4.14)

Amount receivable (in respect of loans, Equity & ICD) - 5.29 - - 5.29 (183.90) (5.29) (-) (-) (189.19)

Amount payable (in respect of loans, Equity & ICD) - - - - - (-) (0.02) (-) (-) (0.02)

* Previous year's figures are shown in the brackets ** Includes transactions with the key management personnel in subsidiary companies and joint venture.

Disclosure of material transactions: Services received: Tata Motors European Technical Centre ` 8.22 crore (March 31, 2013 ` 6.49 crore) Services rendered: Jaguar and Land Rover ` 677.09 crore (March 31, 2013 ` 581.14 crore)

20th ANNUAL REPORT 2013 - 14 127 Additional information to the Consolidated Financial Statements

Note 27 (vi)

The Company has a joint venture with Hindustan Aeronautics Ltd., TATA HAL Technologies Ltd (THTL) for providing engineering and design solutions and services in the domain of aerostructures for aerospace industry. The Company has an investment of ` 5.07 crores as at March 31, 2014, representing 50% shareholding in THTL. The proportionate share of assets and liabilities as on March 31, 2014 and income and expenditure for the year ended March 31,2014 of THTL are given below. (Amount in ` Crore) As on As on As on As on Particulars March 31, March 31, Particulars March 31, March 31, 2014 2013 2014 2013 RESERVES AND SURPLUS INCOME

Profit & loss (3.62) (2.83) Service income 4.09 2.62 (3.62) (2.83) Other income 0.57 0.20 Sub Total 4.66 2.82 NON-CURRENT LIABILITIES 0.09 0.09

CURRENT LIABILITIES 1.39 0.92 (2.14) (1.82) NON-CURRENT ASSETS Net block (including CWIP) 0.37 0.54 EXPENDITURE Long term loans and advances 0.35 0.48 Cost of traded items & services 1.34 - Sub Total 0.72 1.02 Salary & other general expenses 3.78 2.44 CURRENT ASSETS Depreciation 0.32 0.26 Trade receivables 1.83 0.91 Sub Total 5.44 2.70 Projects work in progress 0.10 0.19 Cash and cash equivalents 0.13 0.43 Short term loans and advances 0.10 0.12 Other current assets 0.04 0.58 Sub Total 2.20 2.23

Total 2.92 3.25

Note 27 (vii) Tata Technologies Inc., (TTUS) (indirect subsidiary of Tata Technologies Limited) signed definitive agreements on April 25, 2013 for the acquisition of US-based engineering services company Cambric Holdings Inc., for a total consideration payable to the stockholders of Cambric Holdings, as below: i) US $ 30 million (` 161.43 Crore) in cash on entering into the agreements ii) US $ 2.5 million (` 13.45 Crore) in cash upon meeting the requirements of earnout conditions

However, since Cambric Holdings could not meet the earnout conditions, the consideration of US $ 2.5 million subjected to earnout conditions did not accrue and accordingly the total consideration for the acquisition is US $ 30 million.

Cambric Holdings is a US-based company with a significant footprint in Eastern Europe. The company has three development centers in Romania and its customers include some of the world's marquee heavy machinery, agricultural, off-highway and automotive companies.

The acquisition was consummated on May 1, 2013 through a wholly owned subsidiary of TTUS set up for the specific purpose of this acquisition which as part of the transaction was merged into Cambric Holdings as on the said date, pursuant to which Cambric Holdings Inc., has become wholly owned subsidiary of Tata Technologies Inc., and has been consolidated with Tata Technologies Limited.

128 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Additional information to the Consolidated Financial Statements

Goodwill on Acquisition :

Amount in Amount in Particulars US $ ` Crore *

Assets and Liabilities acquired on acquisition : - Legal reserves (43,401) (0.26) - Fixed assets 1,641,751 9.83 - Current assets 10,971,378 65.71 - Current liabilities (7,696,357) (46.09) Total net assets as on May 1, 2013 4,873,371 29.19 Total purchase consideration including direct expenses 30,816,741 184.56 Goodwill on acquisition 25,943,370 155.37

*At exchange rates prevailing at the balance sheet date.

Note 27 (viii) Previous years figures have been regrouped/reclassified wherever necessary to correspond with the current years classifications / disclosures.

20th ANNUAL REPORT 2013 - 14 129 130 Statement pursuant to Section 212 of the Companies Act, 1956, relating to subsidiary companies

Sr. Name of the subsidiary Financial year of Shares of the subsidiary held by the Net aggregate amount of profits / (losses) Net aggregate amount of profits / (losses) BUSINESS TRANSFORMATION NAVIGATION THROUGH BETTER No. the subsidiary Company directly or through subsidiary of the subsidiary for the financial year of for previous financial years of the subsidiary, ended on company on March 31, 2014 the subsidiary so far as they concern since it became a subsidiary so far as they members of the Company concern members of the Company

Number and face value % of dealt with in the not dealt with in dealt with in the not dealt with in share accounts of the the accounts of the accounts of the accounts of the holding Company for the Company for the Company for the Company for the year ended year ended year ended year ended March 31, 2014 March 31, 2014 March 31, 2014 March 31, 2014

` crore``` crore crore crore

1 Tata Technologies Pte Limited * March 31, 2014 86,463,759 Ordinary shares no par value 100.00 Nil 4.96 N/A 72.04 2 Tata Technologies (Thailand) Limited * March 31, 2014 705,341 ordinary shares at 50 Baht each 100.00 Nil 2.79 N/A 1.42 3 INCAT International Plc. * March 31, 2014 24,275,000 Ordinary shares of Penny 100.00 Nil (1.15) N/A 2.05 1 each fully paid 4 Tata Technologies Europe Limited * March 31, 2014 10,000 Ordinary shares of GBP 1 each 100.00 Nil 61.02 N/A 136.26 fully paid 5 INCAT GmbH * March 31, 2014 1,640 ordinary shares of EURO 100 each 100.00 Nil (0.82) N/A (4.99) 6 Tata Technologies Inc * March 31, 2014 1,50,000 common stock - class A and 99.24 Nil (7.56) N/A 78.57 8,85,520 common stock-class B, with no par value 7 Tata Technologies Canada Inc. March 31, 2014 1 share of no par value 99.24 Nil 0.48 N/A 4.60 8 Tata Technologies de Mexico, March 31, 2014 Fixed Capital of 50,000 share of no par 99.24 Nil 0.07 N/A 0.30 S.A. de C.V. value. Variable Capital of 1713465 share of no par value 9 Cambric Holdings Inc. March 31, 2014 4000 ordinary shares of no par value 99.24 Nil (0.91) N/A - 10 Cambric Corporation, Delaware ** March 31, 2014 10 ordinary shares of USD 0.001 per share 99.24 Nil 53.28 N/A - 11 Cambric Limited, Bahama ** March 31, 2014 5000 ordinary shares of USD 1 per share 99.24 Nil (4.17) N/A - 12 Cambric UK Ltd. ** March 31, 2014 1 ordinary share of GBP 1 per share 99.24 Nil (5.03) N/A - 13 Cambric Managed Services Inc, Utah ** March 31, 2014 1 ordinary share of no par value 99.24 Nil (0.01) N/A - 14 Cambric GmbH ** March 31, 2014 EURO 25000 @ 99.24 Nil 1.87 N/A - 15 Midwest Managed Services, Utah ** March 31, 2014 10 ordinary shares of USD 10 per share 99.24 Nil (0.01) N/A - 16 Cambric Consulting SRL, Romania ** March 31, 2014 307,382 Equity interests of 10 RON per 99.24 Nil (36.59) N/A - Equity interest 17 Cambric Manufacturing #* March 31, 2014 # 100.00 Nil - N/A - Technologies (Shanghai) Co. Ltd.

*By virtue of Section (4) (1) ( C) of the Companies Act, 1956, These are subsidiaries of the Company. # Incorporated w.e.f. March 10, 2014, No investment made as on the Balance Sheet date. ** Due to acquisition of Cambric Holdings Inc., these subsidiaries have become indirect subsidiaries of the Company w.e.f. May 01, 2013. For and on behalf of the Board @As per official Handel Register of Germany & Articles of Association, No Actual certificate issued as on Balance Sheet date. S Ramadorai P R McGoldrick Chairman Managing Director R Gopalakrishnan Samrat Gupta Director Chief Financial Officer P P Kadle Anubhav Kapoor Director Company Secretary C Ramakrishnan Director Date: May 15, 2014 Place: Mumbai Statement pursuant to exemption received under section 212(8) of the Companies Act, 1956 relating to subsidiary companies

(Amount in ` Crore)

Investments Other than Profit Provision Profit Sr. Reporting Exchange Total Total Proposed Name of Subsidiary Company Country Capital Reserves Investment Turnover Before for After No. Currency Rate Assets Liabilities Dividend in Taxation Taxation Taxation Subsidiaries

1 INCAT International Plc. U.K. GBP 99.54 2.42 45.18 49.51 1.91 - - (1.15) - (1.15) -

2 Tata Technologies Inc. USA USD 59.89 262.75 (484.47) 167.41 389.13 - 498.23 (6.61) 0.95 (7.56) -

3 Tata Technologies (Canada) Inc. USA USD 59.89 0.01 4.71 23.73 19.02 - 8.38 1.89 1.40 0.48 -

4 Tata Technologies de Mexico, S.A. de C.V. USA USD 59.89 0.93 3.17 9.45 5.35 - 18.48 0.11 0.03 0.07 -

5 Cambric Holdings Inc. USA USD 59.89 38.60 5.31 176.01 132.11 - 6.44 (9.22) (8.32) (0.91) -

6 Cambric Corporation, Delaware * USA USD 59.89 0.00 1.01 11.74 10.73 - 101.65 53.29 0.01 53.28 -

7 Cambric Limited, Bahama * USA USD 59.89 16.17 (0.22) 15.95 - - 3.95 (4.17) - (4.17) -

8 Cambric UK Ltd. * U.K. USD 59.89 0.00 1.06 6.01 4.95 - 49.29 (4.79) 0.24 (5.03) -

9 Cambric Managed Services Inc, Utah * USA USD 59.89 0.00 (0.01) 0.00 0.01 - - (0.01) - (0.01) -

10 Cambric GmbH * Germany USD 59.89 0.18 0.21 0.70 0.30 - 4.53 1.92 0.06 1.87 -

11 Midwest Managed Services, Utah * USA USD 59.89 0.00 (0.01) 0.01 0.02 - - (0.01) - (0.01) -

12 Cambric Consulting SRL, Romania * Romania USD 59.89 9.83 1.45 15.38 4.10 - 43.45 (36.29) 0.30 (36.59) -

13 Cambric Manufacturing Technologies (Shanghai) Co. Ltd. # China USD 59.89 ------

20th ANNUAL REPORT 2013- 14 14 Tata Technologies Europe Limited UK GBP 99.54 0.10 239.74 435.94 196.09 - 992.01 73.24 12.22 61.02 -

15 INCAT GmbH Germany EURO 82.30 1.35 15.43 18.08 1.30 - 0.43 (0.08) 0.74 (0.82) -

16 Tata Technologies (Thailand) Limited Thailand BAHT 1.84 6.50 2.96 10.58 1.12 - 12.19 2.79 - 2.79 -

17 TATA Technologies Pte Ltd. Singapore USD 59.89 323.41 364.09 692.88 5.39 - 27.96 5.15 0.19 4.96 -

Notes: 1 The Ministry of Corporate Affairs vide its circular dated February 08, 2011 has granted a blanket approval for exemption from attaching the accounts of subsidiary companies to the accounts of the holding company, subject to fulfillment of certain conditions. Accordingly, the said documents are not being attached with the Balance Sheet of the Company. # Incorporated w.e.f. March 10, 2014 * Due to acquisition of Cambric Holdings Inc., these subsidiaries have become indirect subsidiaries of the Company w.e.f. May 01, 2013. 131 Frequently Asked Questions by Investors:

1. Procedure for notifying the change in address

The investor must send a request letter to TSR Darashaw Pvt. Ltd (TSRDPL), mentioning the new address and the pin code along with all the folio numbers, duly signed by the first shareholder, as per the specimen signature registered with TSRDPL. TSRDPL will then advise about the documents to be submitted for registering the address change.

A computerized acknowledgement will be sent to the Investor's new address confirming the updation of the change in the records.

In case of dematerialized holdings, the Investor must write to his/her Depository Participant immediately and ensure that he or she receives a confirmation of them having noted the Investors' new address.

2. Procedure for notifying change of name

Investors notifying the change of name should follow the following procedure:

A. Individuals

Please submit the following to TSRDPL:

1. Consequent to marriage/divorce/attaining majority, please send an attested copy of the marriage certificate/divorce decree/birth certificate or school leaving certificate as the case may be, duly attested by a Notary Public/Bank Manager under his official seal stating full name, address & registration no. (in case of Notary Public) and full name, designation & name and address of bank (in case of Bank Manager).

2. Prescribed form, available at the office of TSRDPL (can also be downloaded from TSRDPL website), duly completed and signed by the holder(s). The signature of the Investor whose name is to be changed should be attested by his/her Bank Manager under his/her official seal stating his/her full name, designation and name and address of Bank. The other holders, if any, should sign as per the specimen signature(s) registered with TSRDPL.

3. Self-attested copy of the PAN card of the holder(s).

4. Share Certificates in original for necessary endorsements thereon.

B. Corporate

For securities held in physical form, please write to TSRDPL enclosing an original or certified copy of the Certificate of Incorporation on Change of Name along with the Share Certificates in original for the necessary endorsements thereon.

3. What should one do in case he/she does not receive the dividend?

The investor should write to TSRDPL on plain paper, mentioning his/her Folio number (all Folio Numbers in case more than one folio), duly signed by the Investor (by all shareholders in case of joint shareholding), as per the specimen signatures recorded with TSRPDL. TSRDPL will then verify the status of the dividend. In case the Dividend Warrant has been returned to TSRDPL or the dividend warrant has not been duly sent, the warrant will be sent to the Investors address as recorded with TSRDPL provided the amount has not been transferred to the Investor Education and Protection Fund. In case there is a change in address to be registered, please refer to instructions under the “Procedure for change of address”.

4. Procedure for renewing a time barred dividend warrant/cheque/dividend

The investor should send the outdated instrument to TSRDPL to enable issue of a fresh instrument. The fresh instrument will be mailed to the address as recorded with TSRDPL, if the amount reflects an outstanding status in the records of TSRDPL, provided the amount has not been transferred to the Investor Education and Protection Fund. In case there is a change in address to be registered, please refer to instruction under “Procedure for change of address”.

132 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION 5. Procedure for transfer of Shares

Transferee(s) need to send the Share Certificate(s) along with the share transfer deed in the prescribed Form 7B, duly filled in, executed and affixed with share transfer stamps, to TSRDPL. For Shares, stamp duty @ 0.25% of the consideration of the transfer should be affixed on the transfer deed at the specified place on the back of the form. In case the number of stamps to be affixed exceeds the space provided in the form, extra sheets may be attached to the form on which the stamps can be affixed. Share transfer stamps are available at the offices of the Government Treasury. The transfer deed can also be franked instead of affixing the share transfer stamps. The prescribed Form 7B can be obtained from any Stock Exchange at Re 1/- per form. For securities held in electronic form, the Investor must contact his/her Depository Participant.

6. Procedure for transmission of Shares

For transmission of securities in case of legal heir/executor in respect of the sole shareholder who is deceased, please submit the following to TSRDPL:

1. An attested copy of the death certificate of the deceased holder along with attested copy of Succession Certificate or Probate of Will or Letter of Administration obtained in respect of the sole holding. Attestation on the above documents should be done by a Notary Public under his official seal stating full name, address & registration no.

2. Relevant certificates for the securities to be transmitted.

3. Prescribed transmission form available with TSRDPL duly completed and signed by the legal heir(s)/ executor(s) whose signature(s) should be verified by his/her/their Bank Manager under his/her official seal stating his full name, designation with name & address of bank.

4. Self certified copy of the PAN Card of the legal heir(s)/executor(s). In case the Investor does not have any such form of Legal Representation, he/she are requested to write to TSRDPL for further advice. For securities held in electronic form, the Investor must contact his/her Depository Participant.

7. Procedure for obtaining duplicate Share Certificate(s) in case of loss/misplacement of original Share Certificate(s)

The shareholder must immediately inform TSRDPL by sending a letter regarding loss of certificates, giving details of folio number and distinctive numbers, duly signed by the first holder as per the pecimen signature registered with TSRDPL. It is advisable to lodge a complaint with the local Police Station. The Investor must send to TSRDPL, an acknowledged copy of the Complaint/FIR for advice on the further course of action.

The investor should state:

● Name of the Company in which he/she holds securities. ● The full name and address, as recorded with TSRDPL. ● The distinctive number(s) of the certificate(s) that is/are missing.

8. Procedure for notifying change in bank account details

The investor must send a request letter to TSR Darashaw Private Limited, mentioning the New Account number which is to be notified, duly signed by the shareholder (by all shareholders in case of joint shareholding), as per the specimen signatures recorded with TSRDPL. The shareholder must also attach a copy of the passbook with the changed bank account details, duly attested by the Bank Manager.

9. Procedure for splitting or consolidation of Share Certificates

The shareholder must send a request letter to TSR Darashaw Private Limited along with the Share Certificates (*provided they are under the same folio in case of consolidation), duly signed by the shareholder (by all shareholders in case of joint shareholding), as per the specimen signature recorded with TSRDPL. The Share Certificates, after splitting or consolidation, will be sent by TSRDPL to the shareholders at their registered address.

*In case of consolidation of Share Certificates having different Folios, please follow the procedure for consolidation of folios to facilitate consolidation of Share Certificate.

20th ANNUAL REPORT 2013 - 14 133 10. Procedure for amalgamation/consolidation of Folios

In case the shareholder has more than one folio registered with same address and identical names which are in same order, the shareholder must send a request letter to TSR Darashaw Private Limited along with the certificates pertaining to the folio having the smaller holdings duly signed by the shareholder (by all shareholders in case of joint shareholding), as per the specimen signature recorded with TSRDPL. Do not send the certificates pertaining to the larger holdings, in which account the multiple folios are being amalgamated. The prescribed form for amalgamation can be obtained from TSRDPL or downloaded from their website. For securities held in electronic form, the Investor must contact his/her Depository Participant.

11. Procedure for “Nomination” for shares

Shareholders who hold the shares singly in physical form and wish to make or change the nomination in respect of the shares held by them as permitted under section 109A of the Act, may submit an application to TSR Darashaw Private Limited (TSRDPL) in the prescribed Form 2B. The said form can be obtained from TSRDPL or downloaded from their website.

For securities held in electronic form, the Investor must contact his/her Depository Participant.

12. Procedure for transposition/change in order of name for holdings

The request for change in the order of names of registered holders should be made in the prescribed Transposition form available at the offices of TSRDPL (can also be downloaded from TSRDPL website). The form is to be signed by all the joint holders as per the specimen signature recorded with TSRDPL, and submitted along with the certificates and self-certified copies of the PAN Cards of all the holders.

Note: Investors can transpose full or part of the holdings.

For securities held in electronic form, the Investor must contact his/her Depository Participant.

13. Receipt of Annual Report through email

Shareholders can receive Annual Reports through email. Shareholders are requested to update their email ids with TSRDPL or their respective Depository Participants. Shareholders are also requested to dematerialize their shares and update their email ids with their Depository Participants.

14. In case of non-receipt of Annual Report

The shareholder can contact the Secretarial Department of the Company to enquire on the status of dispatch of the Annual Reports. The investor can also find the latest Annual Report of the Company on the website of the Company under the “Investors Relations” section.

15. Sale of shares by employees to the Tata Technologies Employee Stock Option Trust

Any employee who wants to sell his/her shares can sell to the shares to the Tata Technologies Limited Employee Stock Option Trust by writing to the Trust at "[email protected]" stating the reason for the sale of the shares. The Trust will then purchase the shares from the employee subject to the approval of the Stock Allotment Committee. After approval of the Committee, the Trust will then inform the employee about the further documents to be submitted and steps to be taken for the sale of shares.

Frequently Asked Questions on Dematerialization:

1. What is Demat and what are its benefits?

Dematerialization ('Demat' in short form) signifies conversion of a share certificate from its present physical form to electronic form for the same number of holding.

It offers scope for paperless trading through state-of-the-art technology, whereby share transactions and transfers are processed electronically without involving any share certificate or transfer deed after the share certificates have been converted from physical form to electronic form.

Demat attempts to avoid the time consuming and complex process of getting shares transferred in the name of buyers as well its inherent problems of bad deliveries, delay in processing/fraudulent interception in postal transit, etc.

Dematerialization of shares is optional and an Investor can still hold shares in physical form. The Depositories

134 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Act, 1996 has been enacted to regulate the matters related and incidental to the operation of Depositories and demat operations. Two Depositories are in operation - National Securities Depository Limited (NSDL) and Central Depository Services Limited (CDSL).

Following are the benefits of demat:

1. Elimination of bad deliveries

2. Elimination of all risk associated with physical certificates

3. No stamp duty on transfers

4. Immediate transfer/trading of securities

5. Faster settlement cycle

6. Faster disbursement of non-cash corporate benefits like rights, bonus etc.

7. SMS alert facility

8. Periodic status reports and information available on internet

9. Ease related to change of address of investor

10. Elimination of problems related to transmission of demat shares

11. Ease in portfolio monitoring

12. Ease in pledging the shares

2. How does the Depository System operate?

The operations in the Depository System involve the participation of a Depository, Depository Participants, Company/Registrars and Investors. The Company is also called the Issuer. A Depository (NSDL and CDSL) is an organization like a Central Bank, i.e. Reserve Bank where the securities belonging to the Investor are held in electronic form, through Depository participants. A Depository Participant is the agent of the Depository and is the medium through which the shares are held in the electronic form. They are also the representatives of the Investor, providing the link between the Investor and the Company through the Depository. To draw analogy, the Depository system functions very much like the banking system. A bank holds funds in accounts whereas; a Depository holds securities in accounts for its clients. A bank transfers funds between accounts whereas; a Depository transfers securities between accounts. In both systems, the transfer of funds or securities happens without the actual handling of funds or securities. Both the banks and the Depository are accountable for safe keeping of funds and securities respectively.

3. How to demat ones shares?

First, the Investor will have to open an account with a Depository Participant (DP) and get a unique Client ID number. Thereafter, he/she will have to fill up a Dematerialization Request Form (DRF) provided by the DP and surrender the physical shares, which is to be dematerialized to the DP.

The DP upon receipt of the shares and the DRF will send an electronic request to the Company's Registrar and Share Transfer Agent through the Depository for confirmation of demat. Each request will bear a unique transaction number.

The DP will simultaneously surrender the DRF and the shares to the Company's Registrar and Share Transfer Agent with a covering letter requesting the Registrar and Share Transfer Agent of the Company to confirm demat. The Company's Registrar and Share Transfer Agent after necessary verification of the documents received from the DP will confirm demat to the Depository.

This confirmation will be passed on from the Depository to the DP, which holds the Investors' account.

After receiving this confirmation from the Depository, the DP will credit the account with the shares so dematerialized. The DP will hold the shares in the dematerialized form thereafter on the Investor's behalf and the Investor will become the beneficial owner of these dematerialized shares.

20th ANNUAL REPORT 2013 - 14 135 4. Can the dematerialized shares be converted back into physical form?

If the Investor is holding shares in electronic form, he/she will still have the option to convert their holding to physical form by submitting a Rematerialization Request Form (RRF) through their DP in the same manner as Dematerialization. Upon receipt of such request from the DP, the Company will issue share certificates for the number of shares so rematerialized.

5. What are the charges to be paid to demat one's physical shares? Will the Company pay for it or does the Investor have to pay for it?

The charges differ from DP to DP and therefore the Investor will have to contact his/her DP for the same. The charges for demat have to be borne by the Investor.

6. Can the share purchased in physical form be directly given to the DP for dematerialization?

Prior to dematerialization of the shares, they have to be registered in favor of the Investor. Hence, the Investor has to necessarily lodge the share certificates with a duly executed transfer deed with the Company's Registrar and Share Transfer Agent.

7. How will the Investor get dividends on dematerialized shares? Will the shareholder get the Annual Report after dematerialization of the shares and would the Investor be able to attend the AGM?

The Depository Participants will give the list of demat account holders and the number of shares held by them in electronic form on the Record date to the Company (Beneficiary Persons, known as Benpos in short). On the basis of Benpos, the Company will issue dividend warrants in favor of the demat account holders.

The rights of the shareholders holding shares in demat form are at par with the holders in physical form. Hence the Investor will be eligible to get the Annual Report and will have the right to attend the AGM as a shareholder.

8. What are the chances of any fraud/disputes in using a demat account? Whom should the Investor approach in such cases?

Common risk factors applicable to trading in physical shares like mismatch in signatures, loss in postal transit etc., are absent since the dematerialized shares are traded script less.

However, in the unlikely event of any other dispute, the concerned Depository Custodian viz. NSDL/CSDL or SEBI would have to be approached for resolving such issues.

9. Can the Investor pledge his/her shares in demat form for the purpose of availing any funding/loan arrangement with the bankers?

Yes. The Investor will have to contact his/her DP for this.

Frequently Asked Questions on e-voting:

1. I know about voting by 'Postal ballot'. What is e-Voting?

e-Voting is voting through an electronic system where shareholders can vote on resolutions of companies requiring voting through Postal Ballot as per extant rules and regulations without having the necessity of sending their votes through post. Ministry of Corporate Affairs has authorised NSDL for setting up an electronic platform to facilitate shareholders to cast vote in electronic form. Accordingly, NSDL has set-up an electronic infrastructure to facilitate shareholders to cast votes in electronic form through internet.

2. How will I benefit from the e-Voting system?

i. Ease of operation. With User ID and password, you can login to e-Voting system (https://www.evoting.nsdl.com) of NSDL through internet and cast your vote from your residence, office etc.

ii. Sufficient time to vote till the end of voting cycle.

iii. Elimination of postal ballots getting lost in-transit.

iv. Paperless mode of casting vote.

136 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION 3. Does the e-Voting system of NSDL facilitate e-Voting for only demat account holders of NSDL?

The e-Voting system of NSDL facilitates voting from all shareholders i.e., shareholders holding shares in physical and demat mode.

4. How do I register for e-Voting facility?

There is no pre-registration related activity required at your end. The registration details viz., User ID and password will be sent by the Issuer / R&T Agent /NSDL in the following mode:

I. In case email address of the Sole / First Holder is available with the Issuer/R&T Agent :

i. NSDL will generate User ID & password and send the same at the email address provided by issuer/R & T Agent.

ii. Using the User ID and password, you will login to the e-Voting system (https://www.evoting.nsdl.com) of NSDL.

II. Others (where email address of the Sole / First Holder is not available with the Issuer/R&T Agent)

i. NSDL will generate User ID and password and provide it to the Issuer/R&T Agent.

ii. The Issuer/R&T Agent will dispatch the User ID and password in a PIN mailer at the address of the Sole/First Holder.

iii. Using the User ID and password, you will login to e-Voting system (https://www.evoting.nsdl.com) of NSDL.

5. If there are demat accounts / shares certificates held by joint holders. In such a case who will cast the vote in e-Voting system?

As, only one of the several joint holders is entitled to exercise voting power, in case of e-voting only first holder is recognized for the purpose of sending user ID & password for e-voting. Accordingly, the vote casted using the User ID and password sent to first holder is recognized on behalf of all the joint holders, as the shareholder who casts the vote through the e-Voting services of NSDL is doing so on behalf of all joint holders.

6. Is there any charge for using e-Voting system of NSDL?

No. Currently, NSDL does not levy any charge on the shareholders for using the e-Voting system.

7. Is there any User manual to understand the login and voting process?

Yes. You can download the User manual from (https://www.evoting.nsdl.com).

8. Will proxy be able to cast vote in e-Voting system?

e-Voting system brings flexibility, convenience and ease of operation for the shareholder to cast vote through internet. Thus, eliminating the need to appoint a proxy.

9. Once I cast my vote on e-Voting System, can I modify my vote before the closing of e-Voting cycle?

No. Vote once casted will be considered final and cannot be modified.

10. Voting on selective resolutions is permitted in Postal Ballot. Is the same available in the e-Voting system as well?

Yes. Since a shareholder can decide to vote only on some of the resolutions put to vote, the same can also be done in e-Voting system as well.

11. Can I reuse the password received for the first time by me for e-Voting?

No. The e-Voting system will force the user to change the password during the first login.

12. How will the results be made available at the end of the voting period?

The Scrutinizer will collate the votes downloaded from e-Voting system and votes received through other means to declare the final results for the resolutions placed for voting by the Issuer.

20th ANNUAL REPORT 2013 - 14 137 13. How will I know if e-Voting website is secured?

If you are visiting the website with a secure connection, you will be able to identify the website through the site's certificate. A secure or encrypted website address will begin with HTTPS rather than HTTP, and you will see a lock icon in the Address bar. Secure connections use certificates to identify the website and to encrypt your connection so that it will be more difficult for a hacker to view. You can also click the lock icon in the Address bar to see more information about the secured website.

14. What is the Procedure for e-voting?

In case a Member receives an email from NSDL [for members whose email IDs are registered with the Company/Depository Participants(s)]:

i. Open email and open PDF file. The said PDF file contains your user ID and password/PIN for e-voting. Please note that the password is an initial password.

ii. Launch internet browser by typing the following URL: https://www.evoting.nsdl.com/

iii. Click on Shareholder – Login

iv. Put user ID and password as initial password/PIN noted in step (i) above. Click Login.

v. Password change menu appears. Change the password/PIN with new password of your choice with minimum 8 digits/characters or combination thereof. Note new password. It is strongly recommended not to share your password with any other person and take utmost care to keep your password confidential.

vi. Home page of e-voting opens. Click on e-Voting: Active Voting Cycles.

vii. Select “EVEN” of Tata Technologies Limited.

viii. Now you are ready for e-voting as Cast Vote page opens.

ix. Cast your vote by selecting appropriate option and click on “Submit” and also “Confirm” when prompted.

x. Upon confirmation, the message “Vote cast successfully” will be displayed.

xi. Once you have voted on the resolution, you will not be allowed to modify your vote.

xii. Institutional shareholders (i.e. other than individuals, HUF, NRI etc.) are required to send scanned copy (PDF/JPG Format) of the relevant Board Resolution/ Authority letter etc. together with attested specimen signature of the duly authorized signatory(ies) who are authorized to vote, to the Scrutinizer through e- mail [email protected] with a copy marked to [email protected].

xiii. If you are already registered with NSDL for e-voting then you can use your existing user-Id and password for casting your vote.

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138 BUSINESS TRANSFORMATION THROUGH BETTER NAVIGATION Tata Technologies Limited Registered Office : 25 Rajiv Gandhi Infotech Park Hinjawadi Pune 411 057

Folio No

Dear Sir,

Re: Recording Bank details for payment of dividend

I, the first/sole holder, have read your letter refer to the letter dated ……………, received from Tata Technologies regarding the captioned subject.

The details of my bank account are given in the form appended below, to which you may electronically credit the payment due to me.

I hereby declare that the particulars given below are correct & complete and also undertake to inform any subsequent changes therein.

I am also enclosing a photocopy of blank cancelled cheque of my bank account.

------

(Signature of the first named holder)

1. Ref. Folio No. :

2. Name :

3. Particulars of the Bank :

a. Name of the Bank

b. Branch Address

c. 9 digit MICR Code No :

d. IFSC code :

d. Account Type : Saving Current Cash Credit (please tick)

e. CBS A/c No. :

f. Email Address : ...... Telephone No. : ......

( please attach a photocopy of your blank cancelled cheque) THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK. Tata Technologies Limited Registered Office : 25 Rajiv Gandhi Infotech Park Hinjawadi Pune 411 057

Attendance Slip

Name:

Address:

Folio No:

I hereby record my presence at the TWENTIETH ANNUAL GENERAL MEETING of the Company at 25, Rajiv Gandhi Infotech Park, Hinjawadi, Pune 411 057, at 11.30 a.m. on Saturday, June 28, 2014.

SIGNATURE

NOTES: 1. Member/Proxyholder wishing to attend the meeting must bring the Attendance Slip to the meeting and hand over the same duly signed, at the entrance. 2. Member/Proxyholder desiring to attend the meeting should bring his/her copy of the Annual Report for reference at the meeting. THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK. Tata Technologies Limited Registered Office : 25 Rajiv Gandhi Infotech Park Hinjawadi Pune 411 057

Form No. MGT-11 Proxy Form [Pursuant to section 105(6) of the Companies Act, 2013 and rule 19(3) of the Companies (Management and Administration) Rules, 2014]

CIN : U72200PN1994PLC013313 Name of the Company : Tata Technologies Limited Registered office : 25 Rajiv Gandhi Infotech Park, Hinjawadi, Pune 411057

Name of the member (s):

Registered address:

E-mail Id:

Folio No/ Client Id:

DP ID:

I/We, being member(s) of shares of the above named Company, hereby appoint 1. Name Address

E-mail Id Signature or failing him

2. Name Address

E-mail Id Signature or failing him

3. Name Address

E-mail Id Signature Tata Technologies Limited

as my/our proxy to attend and vote (on a poll) for me/us and on my/our behalf at the Twentieth Annual General Meeting of the Company, to be held on Saturday, June 28, 2014 at 11.30 a.m. at 25 Rajiv Gandhi Infotech Park, Hinjawadi, Pune 411057 and at any adjournment thereof in respect of such resolutions as are indicated below: Resolution No. 1. *in favour / *against 2. *in favour / *against 3. *in favour / *against 4. *in favour / *against 5. *in favour / *against

*Strike out whichever is not applicable

Signed this day of 2014.

Signature of shareholder Affix 1 Rupee Revenue Stamp Signature of Proxy holder(s)

NOTE: This form of proxy in order to be effective should be duly completed and deposited at the Registered Office of the Company, not less than 48 hours before the commencement of the Meeting. Global Presence

Global Delivery Center Brasov, Craiova & Iasi, Romania Global Delivery Center Coventry, UK

Global Delivery Cen Global Delivery Center Pune & Bangalore, In Detroit, USA

Global Delivery Cen Bangkok, Thailand

International Headquarters

Global Delivery Center / Center of Excellence (CoE)

JV or Legal Entity

Offices

Global Engagement Footprint

APAC EUROPE AMERICAS North America Headquarters Asia Pacific Headquarters Bangladesh ˜ France ˜ ˜ ˜ Brazil ˜ 41050 West Eleven Mile Road 25 Rajiv Gandhi Infotech Park Novi MI 48375-1302 Hinjawadi Pune 411057 China ˜ ˜ Germany ˜ ˜ ˜ Canada ˜ ˜ ˜ USA India India ˜ ˜ ˜ ˜ Ireland ˜ Mexico ˜ ˜ ˜ Tel +1 248 426 1482 Tel +91 20 6652 9090 Japan ˜ ˜ Italy ˜ United States ˜ ˜ ˜ ˜ Saudi Arabia ˜ Netherlands ˜ Europe Headquarters International Headquarters The Enterprise Centre Tata Technologies Pte. Ltd ˜ ˜ ˜ ˜ Singapore ˜ Portugal ˜ Coventry University Technology Park 8 Shenton Way Korea ˜ ˜ Romania ˜ ˜ ˜ ˜ Puma Way Coventry #19-05 AXA Tower West Midlands CV1 2TT Singapore 068811 South Africa ˜ Spain ˜ United Kingdom Tel +65 6779 4733 Sri Lanka ˜ Sweden ˜ Tel +44 (0) 8443 759685 Thailand ˜ ˜ ˜ ˜ Switzerland ˜ UK ˜ ˜ ˜ ˜ Vinay Rawat, Maureen LaForge & Patrick Pepper & Patrick Maureen LaForge Rawat, Vinay his Annual Report. ies Marketing & Communications individuals who contributed to t ies Marketing & Communications Special thanks and appreciation to the following Tata Technolog Tata to the following Special thanks and appreciation

Tata Technologies Limited 25 Rajiv Gandhi Infotech Park Hinjawadi Pune 411 057 India Email: [email protected] www.tatatechnologies.com www.lokusdesign.com